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UOBAM: UOB APAC Green REIT ETF Fund Review (February 2022)

UOB APAC Green REIT ETF Fund Review (February 2022)

UOB Asset Management
UOB Asset Management25 Feb 2022 2494 Views
UOBAM: UOB APAC Green REIT ETF Fund Review (February 2022)

Fund Performance

The investment objective of the UOB APAC Green REIT1 ETF2 (the “Fund”) aims to replicate as closely as possible, before expenses, the performance of the iEdge-UOB APAC Yield Focus Green REIT Index (“Index”).

From its inception on 23 November 2021 to 31 January 2022, the Fund tracked the Index very closely with only a very minor performance deviation that resulted from fees and initial deployment.

The Fund Net Asset Value (NAV) vs Index, 23 November 2021 – 31 January 2022




During the review period (23 November 2021 – 31 January 2022) and year-to-date (YTD), 31 December 2021 - 31 January 2022, the Fund outperformed its non-green APAC REIT peers.

The Fund vs peer ETFs YTD, 31 December 2021 – 31 January 2022




The Fund vs peer ETFs since Inception (23 November 2021) - 23 November 2021 to 31 January 2022



The Index also outperformed its non-green REIT indices YTD, including the S&P Asia Pacific REIT Index and iEdge APAC REIT Index. The Index’s performance slightly underperformed but is still on a par with peer indices since inception.

iEdge-UOB APAC Yield Focus Green REIT Index vs peer indices YTD
31 December 2021 – 31 January 2022




iEdge-UOB APAC Yield Focus Green REIT Index vs peer indices since inception (23 November 2021)
23 November 2021 – 31 January 2022




Market Review

Global equities were choppy in January as market sentiment oscillated between optimism that global economic recovery will weather the Omicron virus variant, and major central banks’ hawkish tilt to fight elevated inflation.

The US Federal Reserve signalled three interest rate rises in 2022, bringing forward the start date of higher interest rates as it winds down quantitative easing. Asia markets performance diverged and extended its downtrend, dragged down by economic risks from a property slowdown in China and the government’s tightening oversight of overseas share sales.

The 10-year US Treasury yield rose 10 basis points (bps) to 1.51 percent month on month (m/m). The S&P APAC REIT index trailed the broader equities market despite gaining 2.7 percent in SGD terms, led by Australia REITs (AREITs).

Outlook and Strategy

The Fund aims to deliver profit by identifying 50 higher-yielding REITs listed across the region that display relatively better environmental performance based on GRESB’s (the global ESG benchmark for financial markets))real estate assessment. The Index’s outperformance relative to its non-green peers YTD is partly derived from its zero exposure to the Goodman Group REIT. This REIT had a lower dividend yield compared to others in the market.

In addition, given its green tilting and risk diversity strategy, the Index is overweight to Australia and underweight Japan. This positive allocation helped to deliver a higher performance. The performance will be further boosted given that this Fund aims for quarterly distributions3 of up to 4 percent per annum which has not been distributed yet.

We remain positive on the outlook of the Asia Pacific Green REIT sector. We believe that the ESG impact on valuations and ownership decisions will increase further. Environmental factors such as carbon and greenhouse emissions, climate and weather risks, and renewable energy are in the spotlight boosted by United Nations Climate Change Conference (COP26) and Intergovernmental Panel on Climate Change (IPCC) reporting signalling 'Code Red for Humanity'.

Given stricter regulations and rising awareness, together with potentially high compliance costs in the future, we believe financial risks of not addressing ESG will increase, and green integration may continue to add value to the REIT index.


1 Real Estate Investment Trust
2 Exchange Traded Fund
3 Distributions are not guaranteed. Distributions may be made out of income, capital gains and/or capital. For further details on the Fund’s distribution policy, please refer to the Prospectus.


Important Notice and Disclaimers
This document is for general information only. It does not constitute an offer or solicitation to deal in units (“Units”) in the UOB APAC Green REIT ETF (the ”Fund”) or investment advice or recommendation and was prepared without regard to the specific objectives, financial situation or needs of any particular person who may receive it.

The information contained in this document, including any data, projections and underlying assumptions, are based upon certain assumptions, management forecasts and analysis of information available and reflects prevailing conditions and the views of UOB Asset Management Ltd (“UOBAM”) as of the date of this document, all of which are subject to change at any time without notice. In preparing this document, UOBAM has relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was otherwise reviewed by UOBAM. While the information provided herein is believed to be reliable, UOBAM makes no representation or warranty whether express or implied, and accepts no responsibility or liability for its completeness or accuracy. Nothing in this document shall, under any circumstances constitute a continuing representation or give rise to any implication that there has not been or there will not be any change affecting the Fund. No representation or promise as to the performance of the Fund or the return on your investment is made. Past performance of the Fund or UOBAM and any past performance or prediction, projection or forecast of the economic trends or securities market are not necessarily indicative of the future or likely performance of the Fund or UOBAM. The value of Units and the income from them, if any, may fall as well as rise, and is likely to have high volatility due to the investment policies and/or portfolio management techniques employed by the Fund. Investments in Units involve risks, including the possible loss of the principal amount invested, and are not obligations of, deposits in, or guaranteed or insured by United Overseas Bank Limited (“UOB”), UOBAM, or any of their subsidiary, associate or affiliate (“UOB Group”) or distributors of the Fund. The Fund may use or invest in financial derivative instruments and you should be aware of the risks associated with investments in financial derivative instruments which are described in the Fund's prospectus. The UOB Group may have interests in the Units and may also perform or seek to perform brokering and other investment or securities-related services for the Fund.

Investors should note that the Fund is not like a conventional unit trust in that an investor cannot redeem his Units directly with UOBAM and can only do so through the participating dealers, either directly or through a stockbroker if his redemption amount satisfies a prescribed minimum that will be comparatively larger than that required for redemptions of units in a conventional unit trust. The list of participating dealers can be found at www.uobam.com.sg. An investor may therefore only be able to realise the value of his Units by selling the Units on the Singapore Exchange Limited (“SGX”). Investors should also note that any listing and quotation of Units on the SGX does not guarantee a liquid market for the Units.

An investment in unit trusts is subject to investment risks and foreign exchange risks, including the possible loss of the principal amount invested. Investors should read the Fund’s prospectus, which is available and may be obtained from UOBAM or any of its appointed agents or distributors, before deciding whether to subscribe for or purchase any Units. You may wish to seek advice from a financial adviser before making a commitment to invest in any Units, and in the event that you choose not to do so, you should consider carefully whether the Fund is suitable for you.

The Fund is not in any way sponsored, endorsed, sold or promoted by and/or its affiliates and SGX and/or its affiliates make no warranty or representation whatsoever, expressly or impliedly, either as to the results to be obtained from the use of the iEdge-UOB APAC Yield Focus Green REIT Index (the “Index”) and/or the figure at which the Index stands at any particular time on any particular day or otherwise, The Index is administered, calculated and published by SGX. SGX shall not be liable (whether in negligence or otherwise) to any person for any error in the Fund and the Index and shall not be under any obligation to advise any person of any error therein.

“SGX” is a trade mark of SGX and is used by the Index under license. All intellectual property rights in the Index vest in SGX.

All materials and contents found in this site are strictly for general circulation and informational purposes only and should not be considered as an offer, or solicitation, to deal in any of the funds or products found/identified in this site. While iFAST Financial Pte Ltd ("IFPL") has tried to provide accurate and timely information, there may be inadvertent delays, omissions, technical or factual inaccuracies and typographical errors. Any opinion or estimate contained in this report is made on a general basis and neither IFPL nor any of its servants or agents have given any consideration to nor have they or any of them made any investigation of the investment objective, financial situation or particular need of any user or reader, any specific person or group of persons. You should consider carefully if the products you are going to purchase are suitable for your investment objective, investment experience, risk tolerance and other personal circumstances. If you are uncertain about the suitability of the investment product, please seek advice from a financial adviser, before making a decision to purchase the investment product. Past performance is not indicative of future performance. The value of the investment products and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. In respect of any matters arising from, or in connection with the said research analyses or research reports, recipients of the report are to contact IFPL at 10 Collyer Quay, #26-01 Ocean Financial Centre Building, Singapore 049315, or by telephone at +65 6557 2853. Where the report contains research analyses or research reports from a foreign research house and if the recipient of such research analyses or research reports is not an accredited investor, expert investor, institutional investor or an ex-accredited investor, IFPL accepts legal responsibility for the contents of such analyses or reports to such persons only to the extent as required by law. Please note that only certain security(ies) herein are available to all investors, while the rest are only available for certain persons to invest in, such as Accredited Investors (as defined in the Securities and Futures Act) or one who invests at least S$200,000 (or its equivalent currency) per transaction. To qualify as an Accredited Investor, one needs to submit a declaration form and certain relevant supporting documents, according to iFAST’s prevailing policies and procedures.

Please read our full disclaimers on the website at ( https://secure.fundsupermart.com/fsmone/policies/328125/investment-account-terms-&-conditions).

iFAST Financial Pte Ltd (IFPL) (registered address: 10 Collyer Quay #26-01 Ocean Financial Centre Singapore 049315, Telephone: 6557 2000) holds the Financial Advisers Licence issued by the Monetary Authority of Singapore ('MAS') to conduct regulated activities of advising on securities, marketing of collective investment schemes and arranging of any contract of insurance in respect of life policies, other than a contract of reinsurance and the Capital Markets Services Licence issued by the MAS to conduct regulated activities of dealing in securities and providing custodial services for securities. While IFPL has made every effort to ensure the independence of the report's contents, IFPL's nature of business is such that IFPL and its connected and associated entities together with their respective directors, officers and staff may be involved in providing dealing or investment-related services in the abovementioned securities, and have taken or may take positions in the securities mentioned in this report, and may also act as the principal for any buy or sell trades.

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