CSOP iEdge S-REIT Leaders Index ETF (SGX:SRT/SRU) Review

CSOP iEdge S-REIT Leaders Index ETF (SGX:SRT/SRU) is one of the 5 REIT ETFs listed on SGX. If you’re looking to invest in Singapore REITs or S-REITs but unsure of which one to invest in, REIT ETFs might be a good option for you to consider.

Overview

CSOP iEdge S-REIT Leaders Index ETF trades on SGX under 2 tickers – SGD counter stock code: SRT, and USD counter stock code: SRU. For ease of reference, I’ll refer to this ETF as SRT henceforth.

CSOP asset management is actually founded in Hong Kong, and is the first offshore entity set up by a regulated Chinese asset manager. SRT tracks the iEdge S-REIT Leaders Index, created and maintained by SGX.

Index & Holdings

The iEdge S-REIT Leaders Index is made up of the 26 largest and most liquid REITs listed on Singapore’s SGX. The biggest holdings are Ascendas REIT, CICT and the Mapletree group REITs MLT, MIT and MCT. The latest 12 month dividend yield is 4.76% (as of 29 July 2022).

You can find more info on the index and the factsheet here.

Performance

According to the latest performance data from CSOP, SRT is down -16.5% YTD. Since the ETF is <1 year old (incepted on 18 Nov 2021), there’s no 1-year performance data yet.

You can find performance figures for longer period for the underlying index on SGX website, but it’s pretty dated (as of 29 July 2022). The 5Y annualised total return (including reinvested dividends) was 6.50%. IMO, not particularly impressive but then again investing in REITs is not so much about the capital gains but more for the dividends and price stability.

Dividends

The latest 12-month dividend yield stands at 4.76% as of 29 July 2022. Since then however, S-REIT prices have declined quite a bit starting Sep 2022, so the dividend yields would be higher.

According to CSOP website, the NAV for SRT on 25 Nov 2022 was $0.8376. Last dividend/distribution was $0.021062 for 1H2022. Annualising that distribution vs NAV would give us 5.03% yield for 2022.

Fees

CSOP currently charges total expense ratio (TER) of 0.6%, including 0.5% in management fee (max 0.8%).

My Thoughts

SRT might be a great way for investors to gain fuss-free and diversified S-REIT exposure. No need to stress about picking individual REITs and running the risk of picking poor quality REITs.

I decided to take another look at SRT although I’ve been mainly investing in Syfe REIT+ (both track the same index). Recently, I’ve been refining our portfolio allocations, and have a lump sum to invest in REITs.

Typically, I use Syfe REIT+ for regular automated monthly investments but since I have a lump sum I was thinking to just use SC Online Trading where most of our holdings are. Recently, I’ve withdrawn quite a bit of funds from SC to invest in SSBs and trade through other brokers like Tiger, FSMOne, and Webull.

The main advantage of keeping funds in SC is to maintain our Priority Banking status which offers waiver on minimum commissions so trading on their platform is pretty cheap. The flipside of DIY is that SRT does not reinvest dividends automatically, which Syfe REIT+ does (making the whole process virtually automated).

Investing in SRT would be added complexity since my REIT exposure would be split with Syfe REIT+, but I think it won’t be too much trouble since I track these positions on a Google Sheet anyway. Going forward, I might adopt this approach of RSP through Syfe REIT+ and lump sum through SRT.

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Disclaimer: This is not financial advice. I am not professional financial advisor nor do I work in the finance industry. Anything I write here is purely my personal opinion. Please do your own research and due diligence before investing into anything. All investments come with associated risks. Best to consult a financial advisor if you’re still unsure.

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