The growth outlook for 2012 relies upon the fate of the Eurozone countries and according to the Ministry of Trade and Industry, the economy can expect growth from a range of 1-3% in 2012. [Malaysia, Singapore ETFs Rise on Rail Link]
As the growth in the developed world, such as Europe and the U.S., slows, Singapore does have an edge as a source of funding for energy traders and commodity suppliers such as grains, sugar and edible oils, points out Eugene Szeto, HSBC Holdings Plc’s head of Southeast Asia loans syndicate, on Bloomberg.
The Singapore ETF has “a heavy exposure to financials and industrial companies, almost all of which have regional Asian operations,” Morningstar says in a profile of the fund.
“A slower-than-expected global economic recovery will weigh on the growth of export-oriented Singapore,” Morningstar added. “Singapore is a very small country with almost no natural resources. Economic growth is very dependent on international trade and financial services. This fund is fairly concentrated, with the top-10 holdings accounting for about 70% of the total portfolio. Financial companies, which include real estate companies, account for almost 50% of the total portfolio.”
iShares MSCI Singapore Index Fund
Tisha Guerrero contributed to this article.