Singapore's initiative to offer trading in American stocks during Asian hours through its Singapore Depository Receipts (SDR) program has gotten off to a sluggish start. Launched in July 2023, the program saw only S$2.3 million in SpaceX SDRs traded between July and mid-September, a tiny fraction of the approximately $2 billion in average daily SGX turnover. Total trading for Grab and Sea SDRs during the same period was around S$24 million, compared to $26 billion in the US. This underperformance is attributed to factors like the program being perceived as "too late to the party" by some observers and local investors' unfamiliarity with SDRs.
In a broader effort to boost its equities market, Singapore's Monetary Authority of Singapore (MAS) announced it would allocate S$1.45 billion ($1.1 billion) to five asset managers, the third funding batch under its S$6.5 billion Equity Market Development Programme (EQDP). Additionally, MAS is introducing a $16 million market-making sleeve to increase trading interest in SGX-listed stocks. This market-making sleeve is intended to address the persistent issue of low liquidity, particularly for smaller Singapore-listed companies, which has deterred institutional investors.
Despite these efforts, institutional investors recorded a net outflow of S$336 million from Singapore-listed stocks between August 31 and September 25. The EQDP, launched in February 2025, aims to strengthen local fund management capabilities and channel more money into Singapore-listed stocks, alongside other measures like a S$30 million "Value Unlock" program and a proposed SGX-Nasdaq dual-listing bridge. The impact of these initiatives on liquidity and valuations will depend on how quickly the funds are deployed and whether they attract third-party capital.
The context suggests that the SGX and MAS are actively working to invigorate Singapore's equities market, which has lagged behind the city's overall financial dynamism. The low uptake of SDRs for US stocks highlights the challenge of attracting trading interest against established alternatives and the growing global trend of 24-hour trading being developed by major exchanges like Nasdaq, NYSE Arca, and the London Stock Exchange. Citadel Securities is also seeking to attract Asian sovereign wealth funds and other institutions for its 24-hour US equities trading service.
