Post by Lynnette Tania Lee

Singapore's equity market has doubled its monthly trading volume since the start of 2025, after briefly topping $50 billion in March. Inflows into local equity funds have surged too, more than doubling the total held at the start of last year — momentum that's been building since Singapore rolled out reforms to revive its equity market. By the numbers, it looks like a clean success story. Morningstar, however, points to how little this rally can be pinned cleanly on the reforms. In a June webinar hosted by the research firm and a newly published report, analyst Hunter Beaudoin flags a risk he says is getting buried beneath the headline figures: capital is concentrating in stocks that barely trade. SMID-cap exposure among active Singapore funds has climbed sharply within a year, yet even the most liquid name in that basket trades a fraction of what the top blue chips do daily. As Beaudoin puts it, "Liquidity is one of the most overlooked risks that I've seen when reading about these initiatives in the media." Read my story in this week's issue of The Edge Singapore for what this means for fund managers, the EQDP scheme, and why Morningstar's own top-rated Singapore funds are the passive ones. https://lnkd.in/g6TNuXzS #readtheedge