Revisiting The Three REIT ETFs

A while ago, I had written about the three locally listed REIT ETFs here, so this post is some sort of a follow-up. To recap, the three REIT ETFs are the (my short form in brackets) Philip SGX APAC Dividend Leaders REIT ETF (Philip APAC), the NikkoAM-Straits Trading Asia ex Japan REIT ETF (Nikko-Straits Trading) and the Lion-Philip S-REIT ETF (Lion-Philip).

For this blog post, we shall see what would be the weightage of individual REITs and the sectors if we decide to buy all of the REIT ETFs, in equal share numbers, for our investment portfolio, based on the latest fund information.^1,2,3

REIT	Philip APAC	Nikko-Straits Trading	Lion-Philip	Overall Weightage
CAPITALAND MALL TRUST	3.68	10.20	10.00	7.96
ASCENDAS REIT	4.65	10.00	8.20	7.62
CAPITALAND COMMERCIAL TRUST		8.70	9.90	6.20
MAPLETREE COMMERCIAL TRUST		6.40	9.80	5.40
MAPLETREE LOGISTICS TRUST		6.20	5.90	4.03
MAPLETREE INDUSTRIAL TRUST		5.10	6.90	4.00
MAPLETREE NORTH ASIA COMMERCIAL TRUST		4.90	4.80	3.23

Fig.1 – Weightage of individual REITs (in %). REITs that are common in at least two REIT ETFs and among the top 10 holdings are selected.

Sector	Philip APAC	Nikko-Straits Trading	Lion-Philip	Overall Weightage
RETAIL	37.78	38.00	29.20	35.08
INDUSTRIAL	17.37	21.30	23.90	20.82
DIVERSIFIED	27.64	17.00	8.40	17.67
OFFICE	13.53	17.90	19.30	16.89
HOTEL & RESORT	0.96	2.30	8.10	3.78

Fig. 2 – Weightage of REITs by sector (in %). Only top 5 sectors are shown.

Based on the above two tables, we can see that, if the three REIT ETFs are combined into one, Capitaland Mall Trust is the highest holding at 7.96%, with Ascendas coming in second at 7.62%. The biggest component, which is the retail sector, is slightly above 35%, with industrial coming in second at around 21%. However, this status does not remain stagnant as the weightages do change from time to time, though mostly not by that much. If you know some “Google-Fu”, you can check out the weightages from past fund information documents.

A lot of discussion points can be generated based on the above numbers, ranging from the superficial (e.g. which ETF to go to for an all-rounder sector coverage) to the complex that involves looking deeper at various degrees and from different dimensions (e.g. the high concentration of retail REITs in the ETFs, and how shopping habits and the impact of electronic commerce could erode their returns). I would stop at here for now, and I hope at least the above numbers can spark some analysis of your own.

1 – Philip SGX APAC Dividend Leaders REIT ETF. Product Info Sheet. December 2018. https://www.phillipfunds.com/uploads/funds_file/201812_Phillip_SGX_APAC_Dividend_Leaders_REIT_ETF_Product_Sheet.pdf (accessed 8 Feb 2019)

2 – NikkoAM-Straits Trading Asia ex Japan REIT ETF. Factsheet. 31 December 2018. https://www.nikkoam.com.sg/files/documents/funds/fact_sheet/axj_reit_etf_fs.pdf?v20170630 (accessed 8 Feb 2019)

3 – Lion-Philip S-REIT ETF. Fund Information. December 2018. https://lgi.nextview.com/doc/uploads/documents/index.php?type=FS&fid=LEPF&lang=EN (accessed 8 Feb 2019)