The appeal of STI remains low but with good reason
If we did a review of STI from the last day of 2019 to 2020, the 11.8% drop is largely due to the ongoing impacts from the pandemic. However, the global market performance has led us to think that there is a severe lack of appeal for STI. There can be many reasons but a big reason is that funds are flowing out of the index and into other markets and asset classes. As such, will this lack of appeal persist in 2021 or will funds hurry back into STI some time soon? Personally, I feel that the STI has earned its reputation of being stable hence we will continue to see slight adjustments to the index over time but I will not be expecting a huge difference in 2021 for all STI constituents across the board.