THE ABF Malaysia Bond Index Fund (ABFMY1) was the first Malaysian exchange-traded fund (ETF) to be listed on Bursa Malaysia on July 18, 2005 with a total of 537.4 million units at a net asset value (NAV) price of RM1.0434, giving it a total market capitalisation of RM560.7mil.

The ABFMY1 also made history as it was the first bond ETF to be listed on the market, well before any equity-based ETF. It took almost two years before the next ETF was listed - the FBM KLCI ETF with a market capitalisation of RM81.1mil in July 2007. To date, Malaysia has some 10 listed ETFs (inclusive of a Gold ETF and eight other equity index-based ETFs) with a combined market capitalisation of about RM2.04bil.

Out of this amount, RM1.47bil in market capitalisation is related to ABFMY1 while another RM41.3mil is the Gold ETF, which are both not equity-based ETFs.

With a market capitalisation of about RM2bil, the ETFs listed on Bursa Malaysia only represent 0.11% of the overall market capitalisation of about RM1.751 trillion. Clearly, ETFs have not gained the traction that many had hoped for since they were first introduced in 2005.

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