4 Best Performing ETFs In 2021 [8 Jan 2021] Xtrackers MSCI China UCITS ETF (SGX: LG9/TID); United SSE 50 China ETF (SGX: JK8); SPDR Gold Shares (SGX: O87); Lyxor MSCI Asia Pacific Ex Japan UCIT ETF (SGX: P60)

2021 is behind us. As investors, we leave behind one of the most volatile years in recent stock exchange history.

Compared to its peers, the Straits Times Index, which comprises of the 30 largest and most liquid blue-chip companies listed on the Singapore Exchange, continues to be one of the poorest-performing indexes in Asia. Both Exchange Traded Funds (ETFs) that track the STI performance – the SPDR Straits Times Index ETF and the Nikko AM Singapore STI ETF – saw a decline of 8.1% and eight.4% respectively in 2021.

This may have given some investors the impression that Singapore-listed ETFs did not perform well in 2021. However, this isn't true. Many ETFs on the Singapore Exchange (SGX) provide investors with contact with overseas stocks. And when these overseas companies succeed, the ETFs that track them naturally deliver good returns too.

In this week's edition of four Stocks This Week, we checked out the 4 best performing ETFs on the SGX in 2021.

Xtrackers MSCI China UCITS ETF (SGX: LG9/TID)

Available in both USD (SGX: LG9) and SGD (SGX: TID), the Xtrackers MSCI China UCITS ETF invests in large and mid-cap equities that represent about 85% of the Chinese market. Major components within the ETF include Alibaba Group (20%) and Tencent Holdings (15%). Others that the ETF also has contact with are Meituan, China Construction Bank and Baidu.

Since many of the biggest components in this ETF will also be technology companies that have done well in 2021, it comes down as no surprise that the ETF has delivered a return of about 31.6% for 2021. This will make it the best performing ETF on the SGX in 2021.

United SSE 50 China ETF (SGX: JK8)

Offered by UOB Asset Management, the SSE50 (SGX JK8) is definitely an alternative ETF for Singapore investors looking to gain exposure to China's stock market. The ETF tracks the SSE 50 index, featuring its the 50 largest and many liquid A-shares listed on the Shanghai Stock Exchange. Companies that are part of this ETF include Kweichow Moutai, Ping An Insurance, China Merchant Banks and Jiangsu Hengrui Medicine.

With a return of 26.9% for 2021, the ETF has performed well using the China stock market recovery. The index is traded in SGD so there is no need to worry about forex exchange rate risk.

SPDR Gold Shares (SGX: O87)

The only commodity ETF on the SGX, the SPDR Gold Share ETF (SGX: O87) is a superb ETF to consider if you wish to purchase gold without wanting the irritation of having to buy, store and keep physical gold. The ETF invests in Gold Bullion and it is performance is thus associated with gold prices.

Like many other asset classes, gold performed well in 2021, with prices up about 23.6%, from USD 1,527.10 per oz (2 Jan 2021) to USD 1,887.60 (30 Dec 2021). Similarly, the SPDR Gold Share ETF also showed coming back of 23.6% for 2021. If you wish to invest in gold in 2021, the SPDR Gold Share ETF is worth looking at.

Lyxor MSCI Asia Pacific Ex Japan UCIT ETF (SGX: P60)

Rounding in the top 4 best performing ETFs in Singapore may be the Lyxor MSCI Asia Pacific Ex Japan UCIT ETF (SGX: P60) tracks the benchmark index of MSCI Daily Net AC Asia Pacific Ex Japan USD. Consequently, the index measures the performance from the equity market of 10 Asia market country indices: China, Hong Kong, India, Indonesia, Korea, Malaysia, Philippines, Singapore, Taiwan and Thailand.

The biggest components of the ETF are essentially a few of the biggest companies in Asia. Including the Alibaba Group (6.53%), Tencent Holdings (5.47%), Taiwan Semiconductor Manufacturing (3.77%), Meituan Dianping – Class B (1.76%) and AIA Group (1.74%).

For 2021, the ETF delivered coming back of 20.3% to investors.