ETF Digest

) -- You could hardly say that Singapore has a great deal of natural resources, unless you count its human capital. The tiny city state located at the crossroads of Asia depends on its neighbors for just about all things material, but has taken advantage of key niches in the information technology, financial services and pharmaceutical industries to become one of the richest Asian nations. In GDP per capita terms, Singapore ranks either third or fourth wealthiest in the world (depending on whom you ask) behind Qatar and Luxembourg.

It has registered steady -- if not explosive -- growth over the last decade, rising steadily from a GDP of $91 billion in 2001 to 2010's impressive $208 billion, although it did reach an almost unprecedented 14.4% growth rate from 2009 to 2010. Because of its lack of natural resources, further growth in Singapore will hinge on how quickly the global economy recovers. Growth projections for 2012 range from 1% to 3% and will rely heavily on how the eurozone performs.

There are two ETFs focused on Singapore: the popular

iShares MSCI Singapore Index Fund

(EWS) - Get Report

, with $1.55 billion in net assets and an average daily volume of 1.8 million; and the newer, less-popular small-cap variation, the

iShares MSCI Singapore Small-Cap Index Fund


, which has net assets of just $2.96 million and a measly average daily volume of 1475 shares per day. This article will focus on EWS.

According to iShares, EWS "seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the Singaporean equity market, as measured by the MSCI Singapore Index."

As previously mentioned, Singapore is something a of a regional banking and finance hub, so it should come as little surprise that the fund is very heavily concentrated in Financials with a 45.27% allocation, followed by Industrials (25.87%) and Telecommunications (11.38%).

EWS is also heavily concentrated with regard to individual companies, with its ten highest holdings accounting for 64% of the fund. Its top three holdings are DBS Group Holdings LTD (10.77%), Singapore Telecom LTD (10.66%), and United Overseas Bank (9.56%). It should also be noted the country also has a large and busy harbor which serves as a central transit point for shipping traffic for the region's exporting internationally.

At $12.70, EWS is down nearly $2 from its 52-week high of $14.61, but year-to-date has made some strong gains.

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