| Frequently Asked Questions |
| A. General Questions |
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What is an exchange traded fund (ETF)? |
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What is the DBS Singapore STI ETF? |
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What is the Straits Times Index (STI)? |
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What is so different about the DBS Singapore STI ETF? |
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Will the DBS Singapore STI ETF pay any distributors? |
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What is the Net Asset Value (NAV) of DBS Singapore STI ETF? |
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Where can I obtain more information on DBS Singapore STI ETF? |
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| B. Risks |
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What risks do I face by investing in the DBS Singapore STI ETF? |
| C. Management of DBS Singapore STI ETF |
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Who is the manager of DBS Singapore STI ETF? |
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Who is the trustee of DBS Singapore STI ETF? |
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What are the manager's and trustee's annual fees in managing DBS Singapore STI ETF? |
| D. Trading |
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Where is the DBS Singapore STI ETF listed? |
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When is the Initial Offer Period and the First Trading Date for the Fund? |
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How do I subscribe to the DBS Singapore STI ETF during the Initial Offer Period? |
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How do I know what is the issue price of the DBS Singapore STI ETF during the Initial Offer Period? |
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How do I transact in the DBS Singapore STI ETF after the Initial Offer Period? |
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What are the costs associated with transacting in the DBS Singapore STI ETF? |
A. General Questions
What are ETFs?
Exchange-traded funds (ETF) are open-ended investment funds or unit trusts that are listed and traded on a stock exchange. They are typically designed with the objective to track the performance of a specific benchmark, such as a stock index. You can buy or sell units in ETFs at market prices any time during the trading hours on an exchange, just like how you transact in stocks of listed companies on the exchange.
What is the DBS Singapore STI ETF?
The DBS Singapore STI ETF is an exchange traded fund that tracks, as closely as possible, the performance of the Straits Times Index (STI), by substantially investing its assets in the constituent stocks of the STI in the same weightings as reflected in the STI..
What is the Straits Times Index (STI)?
The STI is a market value weighted index comprising the top 30 main-board listed companies based on their market capitalisation on the Singapore Stock Exchange (SGX).
What is so different about the DBS Singapore STI ETF?
The DBS Singapore STI ETF can be traded in a lot size of 100 units. The smaller lot size means that investors can better customise the investment amount according to their own investment requirements.
Will the DBS Singapore STI ETF pay any distributions?
The Fund aims to pay distributions on Units from dividends received from the underlying shares. However the ability of the Fund to pay distributions on the Units is dependent on the dividends declared and paid by the companies whose shares are held by the Fund and the level of fees and expenses payable by the Fund.
What is the Net Asset Value (NAV) of DBS Singapore STI ETF?
The Net Asset Value (NAV) reflects the value of DBS Singapore STI ETF’s assets. It is calculated on a per Unit basis by dividing the total Net Asset Value of DBS Singapore STI ETF by the number of Units outstanding.
The NAV of DBS Singapore STI ETF will be calculated after the close of trading on SGX-ST at the end of each dealing day. The NAV price will be published on the 2nd business day after the relevant dealing day.
Please refer to the Prospectus for more information.
Where can I obtain more information on DBS Singapore STI ETF?
You can obtain more information on DBS Singapore STI ETF through participating dealers or download the prospectus of DBS Singapore STI ETF from this website www.dbsam.com.
You may also call our Customer Service Hotlines at 1800 535 8025 (DBS Asset Management) or 6533 9688 (DBS Vickers Securities)
B. Risks
What risks do I face by investing in the DBS STI ETF?
The Fund carries significant risks as it is a narrowly focused fund that invests solely in equities listed on the STI. Please refer to the Prospectus for the risk factors, including, without limitation:
Market Risk – As the DBS Singapore STI ETF tracks the performance of the STI, investors in the Fund will be exposed to the price fluctuations of the Units due to a number of factors, including, without limitation, the price fluctuations of the constituent stocks within the STI.
Liquidity Risk - Although Units in the Fund are listed on the SGX-ST, investors should be aware that there can be no assurance that active trading markets for Units will develop, nor is there a certain basis for predicting the actual price levels at, or volumes in, which Units may trade.
Tracking Error Risk - Changes in the NAV of the Fund are unlikely to replicate exactly changes in the STI due to factors such as fees and expenses of the Fund, liquidity of the market and changes to the Index.
C. Management of DBS Singapore STI ETF
Who is the manager of DBS Singapore STI ETF?
DBS Asset Management Ltd (DBSAM).
Who is the trustee of DBS Singapore STI ETF?
HSBC Institutional Trust Services (Singapore) Limited
What are the manager's and trustee's annual fees in managing DBS Singapore STI ETF?
Currently, the manager’s management fee is 0.20% per annum of the Fund’s NAV. Based on the prospectus, the management fee may be varied up to 0.5% per annum of the Fund's NAV.
The current trustee fee is 0.08% per annum of the Fund’s NAV subject to a minimum fee of S$24,000 for the first financial year and a minimum fee of S$48,000 per annum thereafter. Based on the prospectus, the trustee fee may be varied up to 0.15% per annum of the Fund's NAV
D. Trading
Where is DBS Singapore STI ETF listed?
DBS Singapore STI ETF is listed on SGX-ST.
When is the Initial Offer Period and the First Trading Date for the Fund?
The Initial Offer Period is from 12 February to 18 February 2009, 12 noon.
The First Trading Date (Listing Date) of the Fund on the Singapore Stock Exchange is 25 February 2009.
How do I subscribe to the DBS Singapore STI ETF during the Initial Offer Period?
You can do so at any DBS or POSB ATM, via cash subscription, or through DBS Vickers Securities; the participating dealer.
How do I know what is the issue price of the DBS Singapore STI ETF during the IPO period?
DBSAM will determine the actual issue price of the Units and the number of Units to be allotted to each investor 3 Business Days after the close of the Initial Offering Period. Any excess monies paid by an investor will be refunded to the investor's DBS or POSB bank account (as the case may be) by no later than 5.00pm on the fifth Business Day after the close of the Initial Offering Period.
How do I transact in the DBS Singapore STI ETF after the Initial Offer Period?
You may wish to contact your respective stockbrokers to buy or sell Units in the DBS Singapore STI ETF.
You can purchase and sell the Units in STI ETF Fund in the same way as you can purchase and sell shares on SGX-ST during trading hours through your stockbroker or their online stock trading facility.
What are the costs associated with transacting in the DBS Singapore STI ETF?
For the purchase and sale of Units in the Fund on the SGX-ST, there is no sales charge. Investors will however have to bear brokerage fees charged by their stockbrokers as in the case of acquiring or selling shares listed on the SGX-ST. Currently, clearing fee for trading of units in the Fund on the SGX-ST is at the rate of 0.04% of the transaction value, subject to a maximum of S$600.00 per transaction and subject to the prevailing goods and services tax (currently 7%).
Please refer to the Prospectus for more information.
E. Central Provident Fund (CPF) Usage
Can I use my CPF to purchase DBS Singapore STI ETF?
As the Fund is currently not approved under the CPF Investment Scheme (CPFIS), you will not be able to use your CPF funds to purchase Units in the Fund.