Singapore Exchange

Index Solutions

SGX Index Edge

7 February 2018

Agenda

1. Introduction to Thematic Investing

2. SGX-Factset Thematic Indices Suite of 4 themes – Launched in Oct 2017

2 new upcoming themes – To be launched in 1H 2018

3. Challenges in Building Thematic Portfolios

4. Factset RBICs as a Powerful Data Source

5. Thematic Investing Trends in Asia

2Private & Confidential

Thematic Investing

3Private & Confidential

Thematic Solutions by SGX Index Edge

4Private & Confidential

Broadly speaking, thematic investing seeks to identify and capture the opportunities created by structural social, economic or demographic trends and their long-term secular influences on the world’s markets and economies.

These investments track the second- and third-order effects of structural trends that create hot spots of investment opportunities where significant amounts of capital could be concentrated.

By ignoring geographical boundaries, style biases and traditional sector classifications, it provides investors with a distinct strategic advantage to identify emergent and potentially rewarding investment trends and invest in the companies – from the downstream to upstream value chain – that are well positioned to benefit from it.

Enables investors to capture additional alpha by zeroing in on hot spots of investment opportunities where significant amounts of capital will be deployed.

Provides investors with a flexible way to validate and express their long-term views by applying a forward-looking perspective toward investing.

What is Thematic Investing?

Why Invest in Themes?

SGX-Factset Thematic Indices

5Private & Confidential

SGX-FactSet Thematic Indices

6Private & Confidential

The SGX-FactSet Global Cybersecurity Indexseeks to tap on the increased spending on cybersecurity, as spurred by the growing incidence and sophistication of cybercrime.

CybersecurityThe SGX-FactSet Asia Healthcare Select Equal-Weighted (EW) Index aims to provide exposure to Asian companies primed at targeting Asia’s growing health concerns and demographic trends.

Healthcare

The SGX-FactSet Global Robotics Indexseeks to track the performance of global securities with large revenue exposure to Robotics and Automation.

Robotics and AutomationThe SGX-Factset Asia Technology Advantage Equal-Weighted (EW) Index aims to get exposure to Asian securities with high annual revenues from forward-looking technology-related business segments that are poised for growth.

Technology Advantage

Launched in October 2017, the SGX-Factset Thematic series currently consists of four

thematic indices that provide investors with the ability to track some of the most dynamic

and interesting industries today:

Thematic Solutions by SGX Index EdgeSGX-Factset Global Robotics Index

The SGX-FactSet Global Robotics Index seeks to track the performance of global securities with large revenue exposure to Robotics and Automation, as manufacturing industries globally take to the productivity and sustainability accorded by robots.

Name of Index SGX-Factset Global Robotics Index

No. of Constituents 40

Currency USD

Base Date 26 September 2011

Base Value 1000

Weighting Free Float Capitalisation

Review Dates Semi-annually in Mar and Sep

Bloomberg Ticker SGXFR (Price Return)

Performance (as at 29 Sep 2017)

SGX-FactSet Global Robotics Index (TR) 1Y 3Y* 5Y*

Returns 38.27% 13.88% 20.91%

*Returns are reported on an annualised basis.

Risk Analysis

Company Name Country SEDOL Index Weight

NIDEC CORP JAPAN 6640682 7.09%

ROCKWELL AUTOMATION INC UNITED STATES 2754060 6.98%

FANUC CORP JAPAN 6356934 6.97%

KEYENCE CORP JAPAN 6490995 6.96%

PARKER HANNIFIN CORP UNITED STATES 2671501 6.89%

EMERSON ELECTRIC CO UNITED STATES 2313405 6.88%

METTLER-TOLEDO INTERNATIONAL UNITED STATES 2126249 6.74%

AMETEK INC UNITED STATES 2089212 6.45%

OMRON CORP JAPAN 6659428 4.50%

CDK GLOBAL INC UNITED STATES BQXTWQ5 4.00%

Top 10 Constituents

SGX-FactSet Global Robotics Index (TR) 1Y 3Y* 5Y*

Standard deviation* 7.16% 15.50% 14.87%

Sharpe Ratio 4.62 0.92 1.36

Maximum Drawdown -26.27% -39.28% -61.65%

Data updated as of 29 Sep 2017Private & Confidential7

500

1000

1500

2000

2500

3000

3500

SGX-FactSet Global Robotics (PR) SGX-FactSet Global Robotics (TR)

*Standard deviations are calculated using monthly returns and reported on an annualised basis.

Thematic Solutions by SGX Index EdgeSGX-Factset Global Cybersecurity Index

The SGX-FactSet Global Cybersecurity Index seeks to tap on the increased spending on cybersecurity globally to strengthen fortification, as spurred by the growing incidence and sophistication of cybercrime.

Name of Index SGX-Factset Global Cybersecurity Index

No. of Constituents 30

Currency USD

Base Date 26 September 2011

Base Value 1000

Weighting Free Float Capitalisation

Review Dates Semi-annually in Mar and Sep

Bloomberg Ticker SGXFC (Price Return)

Performance (as at 29 Sep 2017)

SGX-FactSet Global Cybersecurity Index (TR) 1Y 3Y* 5Y*

Returns 28.47% 12.95% 17.63%

*Returns are reported on an annualised basis.

Risk Analysis

Company Name Country SEDOL Index Weight

PALO ALTO NETWORKS INC UNITED STATES B87ZMX0 7.19%

OTSUKA CORP JAPAN 6267058 7.17%

CHECK POINT SOFTWARE TECH UNITED STATES 2181334 7.09%

TREND MICRO INC JAPAN 6125286 6.91%

SYMANTEC CORP UNITED STATES 2861078 6.89%

FIREEYE INC UNITED STATES BD4R405 6.87%

PROOFPOINT INC UNITED STATES B6VDQC3 6.82%

FORTINET INC UNITED STATES B5B2106 6.58%

AMANO CORP JAPAN 6027304 4.57%

OSI SYSTEMS INC UNITED STATES 2111579 4.33%

Top 10 Constituents

SGX-FactSet Global Cybersecurity Index (TR) 1Y 3Y* 5Y*

Standard deviation* 12.93% 17.92% 16.22%

Sharpe Ratio 2.01 0.77 1.09

Maximum Drawdown -21.14% -32.39% -55.61%

Data updated as of 29 Sep 2017Private & Confidential8

*Standard deviations are calculated using monthly returns and reported on an annualised basis.

500

1000

1500

2000

2500

3000

SGX-FactSet Global Cybersecurity (PR) SGX-FactSet Global Cybersecurity (TR)

Thematic Solutions by SGX Index EdgeSGX-Factset Asia Healthcare Select EW Index

The SGX-FactSet Asia Healthcare Select EW Index aims to provide exposure to Asian companies primed at targeting Asia’s growing health concerns and demographic trends. These include the rising incidence of lifestyle diseases, obesity and aging population.

Name of Index SGX-Factset Asia Healthcare Select EW Index

No. of Constituents 40

Currency USD

Base Date 26 September 2011

Base Value 1000

Weighting Equal-weighted

Review Dates Semi-annually in Mar and Sep

Bloomberg Ticker SGXFHS (Price Return)

Performance (as at 29 Sep 2017)

SGX-FactSet Asia Healthcare Select EW Index (TR) 1Y 3Y* 5Y*

Returns 7.29% 9.77% 13.75%

*Returns are reported on an annualised basis.

Risk Analysis

Company Name Country SEDOL Index Weight

VIROMED CO LTD KOREA B0P5XC2 2.65%

ONO PHARMACEUTICAL CO LTD JAPAN 6660107 2.61%

TSUMURA & CO JAPAN 6906919 2.60%

SOSEI GROUP CORP JAPAN B01QMC2 2.60%

SAMSUNG BIOLOGICS CO LTD KOREA BYNJCV6 2.56%

SHIONOGI & CO LTD JAPAN 6804682 2.55%

ASAHI INTECC CO LTD JAPAN B019MQ5 2.55%

LUPIN LTD INDIA 6143761 2.55%

HANMI PHARM CO LTD KOREA B613DJ9 2.55%

NIPPON SHINYAKU CO LTD JAPAN 6640563 2.54%

Top 10 Constituents

SGX-FactSet Asia Healthcare Select EW Index (TR) 1Y 3Y* 5Y*

Standard deviation* 12.59% 13.17% 12.56%

Sharpe Ratio 0.62 0.77 1.09

Maximum Drawdown -13.90% -27.41% -46.46%

Data updated as of 29 Sep 2017Private & Confidential9

*Standard deviations are calculated using monthly returns and reported on an annualised basis.

500

1000

1500

2000

2500

SGX-Factset Asia Healthcare Select EW Index (PR)

SGX-Factset Asia Healthcare Select EW Index (TR)

Thematic Solutions by SGX Index EdgeSGX-Factset Asia Technology Advantage EW Index

The SGX-Factset Asia Technology Advantage EW Index aims to get exposure to Asian securities with high annual revenues from forward-looking technology-related business segments that are poised for growth.

Name of Index SGX-Factset Asia Technology Advantage EW Index

No. of Constituents 50

Currency USD

Base Date 26 September 2011

Base Value 1000

Weighting Equal-weighted

Review Dates Semi-annually in Mar and Sep

Bloomberg Ticker SGXFTA (Price Return)

Performance (as at 29 Sep 2017)

SGX-FactSet Asia Tech Advantage EW Index (TR) 1Y 3Y* 5Y*

Returns 25.43% 10.61% 16.50%

*Returns are reported on an annualised basis.

Risk Analysis

Company Name Country SEDOL Index Weight

NOMURA RESEARCH INSTITUTE LTD JAPAN 6390921 2.11%

ALPS ELECTRIC CO LTD JAPAN 6021500 2.10%

SK HOLDINGS CO LTD KOREA B39Z8L3 2.09%

SAMSONITE INTERNATIONAL SA HONG KONG B4Q1532 2.08%

YAHOO JAPAN CORP JAPAN 6084848 2.07%

NEC CORP JAPAN 6640400 2.04%

QUANTA COMPUTER INC TAIWAN 6141011 2.03%

ADVANCED SEMICONDUCTOR ENGR TAIWAN 6056074 2.03%

PANASONIC CORP JAPAN 6572707 2.02%

NIPPON TELEGRAPH & TELEPHONE JAPAN 6641373 2.02%

Top 10 Constituents

SGX-FactSet Asia Tech Advantage EW Index (TR) 1Y 3Y* 5Y*

Standard deviation* 10.32% 13.04% 12.28%

Sharpe Ratio 2.26 0.84 1.31

Maximum Drawdown -21.77% -34.86% -51.30%

Data updated as of 29 Sep 2017Private & Confidential10

*Standard deviations are calculated using monthly returns and reported on an annualised basis.

500

1000

1500

2000

2500

SGX-FactSet Asia Technology Advantage EW (PR)

SGX-FactSet Asia Technology Advantage EW (TR)

Upcoming Themes to be IntroducedSGX Global Internet-of-Things (IoT) Index

11

Internet Software/Services

• Companies developing and marketing internet software and/or providing internet services including online databases and interactive services, as well as companies deriving a majority of their revenues from online advertising.

Internet Retail & Online Marketplace

• Companies that generate significant revenue from selling their products online.

• Companies that provide a platform for individual retailers to post and sell their products and/or services.

Online Travel & Hospitality Services

• Companies that provide global online platforms for travel and hospitality services.

Electronic Payment Processing

• Companies that provide electronic payment processing, and infrastructure/cloud services that facilitate the setup of e-commerce websites for their customers.

The SGX Global IoT Index is designed to select companies that have business exposure towards the following 4 themes:

Upcoming Themes to be IntroducedSGX Global Electric Vehicles (EV) Revolution Index

12

EV-producing Automobile Manufacturers

Automobile manufacturers producing electric vehicles (EV) or hybrid vehicles.

Lithium Ion-Battery Producers

Manufacturers of Lithium-ion battery equipment and components

Miners

Miners of Lithium and other chemical components/metals required in the construction of Lithium-ion Batteries

The SGX Global Electric Vehicles (EV) Revolution Index is designed to select companies that have exposure toward the Electric Vehicle (EV) production value-chain:

Some Challenges in Building Thematic Baskets

13Private & Confidential

Some Challenges in Building Thematic Portfolios

Misrepresentations relative to stated objectives

14

Name Weight BBG Ticker GICS Sector RBICS L6

Albemarle Corp 16.12% ALB US Equity Materials Other Additive Manufacturing

FMC Corp 15.87% FMC US Equity Materials Pesticide Manufacturing

Sociedad Quimica y Minera de Chile SA

7.07% SQM US Equity Materials Other Inorganic Chemical Makers

LG Chem Ltd 5.63% 051910 KS Equity Materials Petrochemical Manufacturing

EnerSys 5.20% ENS US Equity IndustrialsHeavy-duty and High-end Batteries Manufacturing

Panasonic Corp 5.10% 6752 JP Equity Consumer DiscretionaryAutomotive and Marine Electronics Manufacturing

Samsung SDI Co Ltd 4.93% 006400 KS Equity Information TechnologyHeavy-duty and High-end Batteries Manufacturing

GS Yuasa Corp 4.80% 6674 JP Equity Industrials -

Tesla Inc 4.68% TSLA US Equity Consumer Discretionary Car Manufacturer

BYD Co Ltd 4.67% 1211 HK Equity Consumer Discretionary Car Manufacturer

Top 10 constituents of a leading Lithium Index

RBICS - a Powerful Data Source

15Private & Confidential

16

Factset Revere Business Industry Classification System (RBICS)APPLE - RBICS Taxonomy: Level 1 - 6

Beyond Classification Systems

17Private & Confidential

18

Beyond Classification SystemsNeed to go beyond to arrive at a representative basket

Broad Eligible Universe for Index

Inclusion

Pure basket of e-Commerce/IoT stocks –

“Control” group

Identify stocks that have proven e-Commerce/IoTattributes based on RBICS revenue exposure

Historical Regression and Correlation Analysis

The broad universe was regressed against the “core” e-Commerce/IoT control basket, to systematically:

1- Identify stocks with highly correlated price movements to e-Commerce/IoT

2- Eliminate noise from the universe

FactSet Revere Classification

General Merchandise Retail

Electronics and Entertainment Retail

FactSet Industry Classification

Internet Retail

Internet Software/Services

Example: e-Commerce / Internet-of-Things The Factset RBICS provides an objective revenue-based assessment that can be used to first define a pure e-

Commerce/Internet-of-Things (IoT) “control group”.

With the “control group” identified, a triangulation approach can be employed to identify core “e-Commerce/IoT” companies through a combination of objective revenue-based assessment, industry classifications, and quantitative regression analyses so as to build a truly representative index basket.

Overlap

Thematic Investing Trends in Asia

19Private & Confidential

20

Thematic Investing Trends in Asia

As an engine of global growth, Asia has produced distinct structural investment themes that track transformative economic, social and market trends such as internet, technology and aging, presenting opportunities for investors with a long-term view to capitalize on these secular growth stories.

Traditionally, Asian investors are trading-oriented and prefer investing in single stocks.

By packaging investment themes – that track long-term economic, social and market trends – into ETFs, this innovative yet simple investment vehicle is likely to appeal to the trading mentality of Asian investors, with potential for explosive growth.

Asia8%

U.S. & Europe

92%

Breakdown of Thematic ETFs across the region

* Source: ETFGI and etf.com

Singapore ExchangeBeijing Hong Kong London Mumbai Tokyo

sgx.com

Thank You

Disclaimer

This document has been prepared by Singapore Exchange Limited and/or its affiliates (“SGX”). This document and the information within is the property of SGX. All intellectual property rights, including but not limited to copyright, patent rights, trademarks, design rights, layout-design rights and proprietary information subsisting in this document or the Index, or any part thereof, shall belong exclusively to SGX. Unless expressly permitted by SGX in writing, this document and the information within must not be used, copied, translated, reproduced, published, modified, distributed, disseminated or otherwise commercially exploited, whether in whole or in part.

The information in this document and the Index may not be used to create, offer, trade, market or promote any investment product without the prior written consent of SGX. Certain third parties may, pursuant to license agreements with SGX, create, offer, trade, market or promote investment products based on or calculated with regard to the Index. SGX does not sponsor or endorse any such investment products.

This document is not intended for distribution to, or for use or to be acted on by any person or entity located in, any jurisdiction where such distribution, use or action would be contrary to applicable laws or regulations or would subject SGX to any registration or licensing requirement. This document is not an offer or solicitation to buy or sell, and should not be construed to be financial advice or any recommendation, for any investment product. This document has been published for general circulation only. It does not address the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a financial adviser regarding the suitability of any investment product before investing or adopting any investment strategies.

Investment products are subject to significant investment risks, including the possible loss of the principal amount invested. Past performance of investment products is not indicative of their future performance. Examples provided are for illustrative purposes only. The information in this document is provided on an “as is”, “as available” basis. SGX makes no warranty or representation, express or implied, statutory or otherwise, as to the accuracy, completeness, timeliness, reliability, merchantability, fitness for particular purpose or the results to be obtained by any person in respect of the information in this document.

While SGX has taken reasonable care to ensure the accuracy and completeness of the information provided, SGX will not be liable for any loss or damage of any kind (whether direct, indirect, consequential, economic, special or punitive damages or losses of any kind or otherwise) suffered due to any omission, error, inaccuracy, incompleteness, delay or any reliance on such information. SGX will not be liable for the content of information provided by third parties.

SGX is an exempt financial adviser under the Financial Advisers Act (Chapter 110 of Singapore).

22Private & Confidential