I am planning to start my investment journey with ETFs. How do I determine if i should start investing in SPDR STI ETF (ES3) or NIKKO AM STI ETF (G3B) first? What is the difference between both?

Hey Anon!

In short, the key differences between the two STI ETFs are in their:

• fund size

• expense ratio

• tracking error

• dividend distribution

You may wish to refer to the table below for a comparison:

There are different opinions as to whether one should invest in the STI ETF, so it is really up to your preference. If you would like to start local, the STI ETF is a good place to begin as you get immediate exposure to Singapore's top 30 companies. Seeing company names that you are familiar with and keeping up with the local news may be easier for you as you kickstart your investment journey.

However, many have also said to avoid the STI ETF because of its underperformance in its history. There is also an overweight focus on local banks and financial institutions, where DBS, OCBC and UOB account for 37.9% of the STI.

Seedly has written an article to cover both the SPDR and NikkoAM STI ETF previously. You can check it out here!​​​

The analytical approach is to gather all the important attributes that you look for before investing an ETF, Gather all the historical data, analyse them and compare them side to side. I look at how the price, dividends, fund size have trended since inception. I also calculate the probabilities to make/lose money and the average positive and negative returns in various time horizons. Lastly, I score these attributes in a checklist.

I have done up the charts and checklists for SPDR STI ETF and NIKKO AM STI ETF. You can get them at https://dl.orangedox.com/fund-analysis-pdfs

File Names:

NIKKO AM SINGAPORE STI ETF (DBSSTI SP Equity)_update_120720

SPDR STRAITS TIMES INDEX ETF (STTF SP Equity)_update_120720

Hope it helps.​​​