Maybank - Exchange Traded Fund

Why trade in ETFs with Us?

Diversify your investment portfolio and gain access to a wide variety of markets and asset classes including commodities such as gold, in an efficient and convenient manner.

Trade seamlessly from a single account and enjoy access to Exchange Traded Funds ("ETFs") listed on exchanges in Singapore, Hong Kong, Malaysia and the USA. As a Maybank Securities client, you are in control with real-time information made available anytime, anywhere through our online platform or your trading representative. Choose the option that best meets your need at any moment in time.

How it Works

Trade ETFs Like Shares

Similar to trading stocks, you may buy or sell ETFs through your Trading Representative or on our online and mobile platforms. Most ETFs listed on SGX are classified as Specified Investment Products ("SIPs") and you are required to pass the qualifications assessment before trading ETFs.

As of 21 May 2014, SGX has classified 9 ETFs as Excluded Investment Products ("EIPs") such that investors can trade these 9 ETFs without first being pre-qualified. For more information, please refer to SGX website.

To find out more about SIPs, visit the FAQs section on this page.

Make Efficient Use of Funds

ETF units can be purchased at a lower cost compared to purchasing individual stocks, bonds or commodities to build a similar portfolio. The extent of diversification benefits depends on the constituents that make up the fund portfolio.

If you would like to get more information on SGX ETFs, kindly refer to the SGX website.

For US Exchange Traded Funds (ETFs) tools and resources, you can log in to Maybank Trade and access the US ETF Knowledge Centre.

Risks of Trading ETFs

As with all financial market investments, investing in ETFs carries a certain level of risk. Here are some risks to take note of before you start investing in ETFs.

Market Risk

Investors are exposed to market risk or volatility of the specific underlying assets which the ETF tracks. In unfavourable market conditions (e.g. market correction or economic crisis) when the general level of stock, bond or commodity prices decline, the value of ETFs will decline accordingly. Nonetheless, ETF investments will still deliver returns close to the underlying index, bonds or commodities.

Tracking Error

The fund manager of the ETF may not be able to exactly replicate the performance of the underlying asset. This is known as 'tracking error'. Tracking errors may occur because the methods of sampling are not 100% accurate. In addition, factors such as management fees and timing differences may reduce the returns of the ETF relative to the index returns.

Currency Risks

When the ETF is priced in one currency (e.g. US Dollar) and is different from the functional currency of the investor (e.g. Singapore Dollar), the investor is exposed to fluctuations in foreign exchange rates, which may increase or erode investment returns on the ETF.

Interest rate risk

The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between two rates, in the shape of the yield curve or in any other interest rate relationship.

Counterparty risk

Investors are exposed to counterparty risks of the Issuer/Manager of the ETFs. The insolvency or default of such counterparties may have an adverse impact on the investors' investments in the ETF.

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FAQs

What do I need to know before getting started?

What Are ETFs?
An Exchange Traded Fund ("ETF") is an open-ended investment fund listed and traded on stock exchanges (e.g. SGX and NYSE Arca), that generally aims to track the performance of an index.

What is an Index?
An index is formed by a basket of securities and is calculated by aggregating the value of the securities and expressing it against a base value. An index reflects the movement of an entire market. The index constituents are selected by the Index Provider from a list of securities which the index represents.

How Does an ETF Track an Index?
Some ETFs are created by full replication, i.e. they invest directly in the underlying stocks. On the other hand, ETFs can also be created by synthetic replication through the use of some derivatives.

If the index rises by 10%, the price of the ETF is very likely to rise by 10%. For a short period of time, it is possible that the returns of an ETF are higher or lower than the returns of the underlying index. But generally in the long run, the returns of the ETF and the underlying index should be close.

What ETFs can I invest in?
At Maybank Securities, you are able to trade ETFs listed in Singapore, Hong Kong, Malaysia and the USA. To find out which ETFs you can trade in, please consult your Trading Representatives.

What are Specified Investment Products ("SIPs")?

In 2012, the Monetary Authority of Singapore ("MAS") introduced guidelines for broking firms to provide safeguards to retail investors who wish to trade Specified Investment Products ("SIPs"). These products have complex features and risks that can be difficult to understand. Under these guidelines, both existing and new clients are required to be formally assessed by their broking firm for relevant knowledge and experience in trading Exchange Traded Funds (ETFs).

If you wish to qualify for ETF Trading, please visit any of our Customer Service Centres to complete the Client Proficiency Assessment (CPA) Form. Alternatively, you may download the form here and mail it to:

Maybank Securities Pte Ltd
Client Services Department
150 Beach Road
#03-01 Gateway West
Singapore 189720

How do I open an account to start trading in ETFs?

To start trading ETFs, you will need two accounts:

A securities account with The Central Depository Pte Ltd ("CDP")
A trading account with Maybank Securities

Thereafter, you may buy or sell ETFs through your Trading Representative or through your online trading platforms. ETFs are traded during the normal trading hours of the respective markets you wish to trade in.

What do I need to know before trading in ETFs?

Due Diligence
Before you start purchasing ETF units, you should be aware of the following:

The investment objective and strategy of the ETF;
The information about the index/underlying asset that the ETF is tracking;
The ETF's dividend policy;
The fees and charges that will be borne by you as an investor;
The channels through which trading information of the ETF will be disclosed;
The information about the management company; and
The risk associated with the ETF.

Transaction Fees and Charges
ETFs are not subject to sales charges but usual brokerage commissions for securities purchases and sales will apply.

For brokerage/commission rates on online trades, click here.
For brokerage/commission rates on offline trades for foreign markets, please consult your Trading Representative.

Where can I go to learn more about US ETFs?

ETFs on US Knowledge Centre
Maybank Securities clients can access free US Exchange Traded Funds ("ETFs") tools and resources found on the US Knowledge Centre, available on Maybank Trade.

Index Constituent Stocks	SZSE Component Index SZSE Small/Mid Cap Innovation Index
Overview of US ETFs Market	View at a glance the most popular ETFs by traded volume, and best and worst performing funds
US ETFs Screener	Filter US ETFs based on your selected criteria. Criteria include 7 asset classes and more than 60 categories of ETFs
US ETF Sectors	Filter US ETFs based on your selected criteria. Criteria include 7 asset classes and more than 60 categories of ETFs. View the performance of ETFs in popular US market sectors at different time durations
ETFs Education	Learn the basics of ETFs trading. Get to know the different types of ETFs and the advantages and risks involved in trading ETFs

Disclaimer:
The US Knowledge Centre ("the Service") is provided by Orbis Systems, Inc. for general information purposes only. Maybank Investment Bank Berhad and its group of companies and/or Maybank Investment Banking Group Holdings Ltd and its group of companies (collectively, "Maybank Securities") do not control nor manage the Service, and any client or user of the Service should not treat the Service as being endorsed or warranted by Maybank Securities in any way. Clients and users of the Service are wholly and solely responsible for their own trading or investment decisions and cannot rely on the information provided in the Service as being accurate, complete or correct. Maybank Securities cannot be held liable or responsible in any way for the consequences of clients/ users' trading or investment decisions, in using or relying on the Service, or otherwise, and clients/users of the Service may wish to consult professional advisers if they have any doubts or queries. System response and access times may vary due to market conditions, system performance and other factors.

Exchange Traded Fund