Own The Brands You Use: Why You Might Want to Invest In The Companies You’re Already Spending On

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The popular investment truism, “Never invest in a business you cannot understand”, would suggest your investment portfolio should include companies and brands that you’re very familiar with. For those of us in Singapore, that could mean our homegrown carrier, Singapore Airlines, where we buy our groceries like Cold Storage and 7-Eleven, or perhaps even where we work, like in Changi Business Park, in one-north, or International Business Park in Jurong East.

But with over 600 companies listed on the Singapore Exchange (SGX), it may be difficult for an investor to decide which brands to add to their portfolio. One place to start is by looking at the Straits Times Index or STI. The STI is made up of the 30 largest SGX-listed companies by market capitalisation, which is the total value of the company’s outstanding shares. As Singapore’s main stock market benchmark, it includes a diverse range of sectors, including banks, retail, telecommunications, and REITs.

This list of companies that make up the STI can change over time and is reviewed quarterly. There was no change in the latest review in December last month, but back in June 2025, Keppel DC REIT replaced Jardine Cycle & Carriage on the STI – adding more technology-linked exposure to the index.

The Brands You Use Are On The STI, Even If You May Not Realise It

Singapore’s three local banks, DBS, OCBC, and UOB, are the most dominant constituents in the STI. Their combined weight is now slightly over 50% of the index.

These brands are no strangers to Singaporeans, most of whom will have savings accounts, credit cards, and home loans from one or more of these financial institutions. However, there are other constituents in the STI that may initially not be familiar to investors, but you’ll definitely know the brands they own.

Source: Amova Asset Management (information correct as of Sep 2025)

If you’re on the CapitaStar mobile app, you’d be very familiar with just how many CapitaLand malls there are in Singapore. The 18 malls include Raffles City and Plaza Singapura in the city centre, all the way to the ends of the island in Tampines Mall, Sengkang Grand Mall, and Westgate.

All these malls are part of the CapitaLand Integrated Commercial Trust, the first and largest real estate investment trust (REIT), listed on the SGX and part of the STI.

Telecommunications group Singtel is listed on the SGX and is part of the STI. We are all familiar with Singtel as a mobile network and broadband provider, but it is also the parent company of NCS, the top IT services provider in Singapore. NCS future-proofed the government’s digital infrastructure, as well as helped to transform the healthcare industry by automating workflows and digitalising data.

Cold Storage, 7-Eleven, and Guardian are all household names, but they also belong to the same parent company, DFI Retail Group. That’s why their house brand Meadows can be found at all of these stores. But as widespread as DFI Retail Group is, they are still a small part of a larger entity known as Jardine Matheson Holdings.

The diversified, Asia-focused investment company has a massive portfolio of businesses, including the Mandarin Oriental hotel group, and Hongkong Land which has the Marina Bay Financial Centre, One Raffles Quay, and One Raffles Link & CityLink Mall in its portfolio.

The STI Has Performed Well, Especially Due To A Stable Singapore Dollar

In a year that has been dominated by concerns and uncertainty over the US tariffs, the STI has proven particularly resilient. Initially crossing 4,000 at the end of March last year, the “Liberation Day” tariff announcements on April 2 caused the STI to crash, along with other global stock markets.

By the end of April, however, the STI had almost bounced back completely. On July 2, it closed at a record high of 4,010. Currently, the new record is 4,849, which it achieved just last week.

This resiliency was backed by a stable Singapore dollar, which has grown in its safe-haven appeal even as other currencies like the US dollar and the Japanese yen have weakened over the year.

This has resulted in more attention to the STI, both from retail and foreign investors, drawn by its strong performance. Singapore is also one of the world’s most progressive economies, becoming one of the top financial hubs, a well-positioned trade hub, and a leading innovation hub.

Source: Amova Asset Management (information correct as of Sep 2025)

Gaining Exposure To The STI Through Amova Singapore STI ETF

Income-seeking investors might want to enjoy the high dividend yield of the STI, which has historically been approximately 3% to 5% each year between 2014 to 2024.*

(*Dividend yield of the Straits Times Index (STI) is not the same as that of the Amova Singapore STI ETF. Past dividend yields are not indicative of future dividend yields.)

However, as the STI is an index, you cannot “buy the STI”. To gain exposure to the STI’s performance, you will need to invest in an Exchange Traded Fund (ETF) that replicates the performance of the STI, such as the Amova Singapore STI ETF.

The Amova Singapore STI ETF adopts a full replication strategy. This means it invests in all of the companies in the STI, in substantially the same weightings as reflected in the STI.

This makes it a suitable investment product for those who want to invest in Singapore’s top blue-chip companies and are looking for a low-cost option. The total expense ratio (TER) of the Amova Singapore STI ETF is capped at 0.25% per annum. Investors who don’t have the time to do the in-depth company research necessary to perform individual stock-picking can also get immediate exposure to a diversified Singapore equity portfolio through the STI ETF.

As with any investment, there are risks associated with ETFs. As an ETF takes on the risks of the assets it invests in, its net asset value fluctuates with the valuation of these underlying assets, and there is always a possibility of loss. However, ETFs are generally considered to be lower risk compared to individual underlying stocks due to their diversified nature.

Please note that while this information provides a general understanding of ETFs, it’s always important to do thorough research, consult with a financial advisor, and read the specific prospectus and documentation of any ETF you consider investing in.

A New Accumulation Share Class

On top of its existing distribution share class which intends to pay dividends** every 6 months, Amova has also launched a new accumulation share class for investors who prefer to re-invest their dividends.

Unlike the existing distribution share class which pays out dividends semi-annually in cash, this accumulation share class automatically reinvests dividend payouts back into the fund and accumulates towards the investors’ holdings. By doing so, it helps investors to compound returns over time without needing to manage the cash payouts on their own. This offers greater convenience and may be particularly attractive for long-term investors who prefer capital accumulation.

(**Distributions are not guaranteed and are at the absolute discretion of the Manager. Any distribution is expected to result in an immediate reduction of the Fund’s NAV. Distributions may be paid out of capital which will result in capital erosion and reduction in the Fund’s NAV, which will be reflected in the redemption price of the Units.)

Investors can also consider complementing their investment in the Amova Singapore STI ETF with another of Amova’s 8 ETFs, including the ABF Singapore Bond Index Fund, the Amova-StraitsTrading Asia ex Japan REIT Index ETF, or the Amova SGD Investment Grade Corporation Fund Index ETF.

Whether you are investing regularly in cash or through your SRS or CPFIS account, the Amova Singapore STI ETF offers a straightforward way to participate in Singapore’s growth story, backed by familiar brands, a strong economy, and prudent governance.

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