In addition to joining the STI in 2018, both Venture and Dairy Farm have seen surges in trading turnover in 2018. For the 12 months ending 30 Nov, Venture's average daily trading turnover tripled to S$10.4M, compared to S$3.5M for the previous 12 months.
While Dairy Farm's share price gained 12% in the 12 months ending Nov, its trading turnover soared 76% compared to the previous 12 months. Genting saw the next highest turnover growth for the period at 59%, while UOB, DBS & UOL saw trading turnover up more than a third.
3 of the 5 STI Reserve Stocks also saw turnover surge, with Mapletree Log Trust trading turnover up by 85% compared to the preceding 12 months, Mapletree Ind Trust's trading turnover up 51% and Suntec REIT's trading turnover up more than a third.
In the 2018 year-to-date the Straits Times Index (STI) has generated a 5.8% decline in total return, which is below its 10 year average annualised total return of 9.5%. The STI's 10 year average total annualised return was largely in line with Asia's other financial centres with the Nikkei 225 Index at 9.0% and the Hang Seng Index at 8.8%.
The Singapore stock market also lists hundreds of stocks that report revenue or base assets to Malaysia or China. Over the past 10 years, the KLCI and CSI 300 generated annualised total returns of 6.1% and 7.9% respectively.
Increased volatility in Asia's equity markets this year has seen a significant divide in performances across the region, spanning from a 0.9% decline for the Nikkei 225 Index to a 20.8% decline for China's CSI 300 Index. This has seen more opportunities in short-termer active investing compared to the greater opportunities for passive investing across the region in 2017.
For instance, Yangzijiang Shipbuilding Holdings was the best performing STI stock of 2017 with an 86.3% total return while this year the stock has generated a 12.8% decline in total return. This year, the large China shipbuilder generated the biggest average daily trading ranges in terms of basis points. The stock averaged daily trading ranges from high to low of more than 3.0% for the first 11 months of 2018. Throughout the 2018 year the stock has moved from a high of S$1.66 in January to a low of S$0.840 in July and is currently back at S$1.22.
STI Stocks with Strong Trading Turnover Growth in 2018
The increase in intraday volatility observed for the majority of STI stocks throughout the 2018 year to date has also seen increased trading turnover for more than half of the STI stocks. Trading turnover represents the trading value of a transaction and is simply a multiplication of price and volume for each trade. When trading turnover of a stock significantly outpaces price changes, it can indicate more investor interest in the stock in addition to more active management of investments.
On an average daily basis, the 3 STI stocks that saw the greatest year-on-year increase in trading turnover for the 12 months ending 30 November were Venture Corporation, Dairy Farm International and Genting Singapore.
While these three stocks account for just 5% of the STI weightage, their combined trading turnover more than doubled from S$10.8 million a day for the 12 months ending 30 November 2017, to S$22.2 million a day for the 12 months ending 30 November 2018. Over the 12 month period, the three stocks averaged a 13.1% price decline.
The two STI stocks that saw the greatest growth in trading turnover both joined the STI in 2018. Venture Corporation which saw trading turnover triple, joined on the STI 5 January, whilst Dairy Farm International joined the STI on 24 September.
The 10 STI constituents that recorded the strongest year-on-year growth in average daily turnover for the 12 months ending 30 November 2018 are tabled below. Note the majority of these 10 stocks saw declines in their share prices whilst their trading turnover surged higher.
STI Reserve Stocks with Strong Trading Turnover Growth in 2018
Three of the five STI Reserve Stocks also saw turnover surge, with Mapletree Logistics Trust trading turnover up by 85% compared to the preceding 12 months. Mapletree Industrial Trust trading turnover was up 51% and Suntec REIT's trading turnover was up 35%.
