www.theislamicglobe.com - Two Shari’ah compliant global equity funds based in Singapore will be withdrawn from the May 9 this year.
Singapore Unit Trusts’ Ethical Growth fund and Ethical Value fund were launched at the end of July 2001. To date the cumulative performance of the two has fallen by 35.8% and 33.7% respectively, according to data from Lipper. The funds invested most heavily in the Technology, Oil & Gas and Basic Materials sectors. (source)
Singapore Unit Trusts’ Ethical Growth fund and Ethical Value fund were launched at the end of July 2001. To date the cumulative performance of the two has fallen by 35.8% and 33.7% respectively, according to data from Lipper. The funds invested most heavily in the Technology, Oil & Gas and Basic Materials sectors. (source)
SUT told The Islamic Globe that the funds are to be with drawn due to their small size, and the increased fixed costs involved in maintaining them. The company declined to re veal the size of each fund. However, Martin Chong of Phillip Securities, one of the firms distributing SUT funds, told us that each fund was le ss
than S$10m ($8m). He also confirmed that while they were performing in line with their Dow Jones Islamic Index benchmark, they were underperforming relative to their peers. He argued that there was a domestic market for Islamic funds in Singapore, but the inhibitor to growth was a lack of promotion for Islamic finance
from the government and the banks. Phillip Sec urities distributes five other Islamic funds including its current top performer the HSBC Amanah Global Equity fund.
Sani Hamid, head of Sin gapore’s Financial Alliance Islamic Wealth Advisory, told The Islamic Globe that SUT’s funds were not attracting enough investors.
He said: “Shari’ah funds [in Singapore] will learn that they have to perform with the average or even outperform conventional funds. They can’t depend on their ‘Shari’ah-ness’ to attract investors.”
SUT is owned by the Malaysian government’s Permodalan Nasional, which has almost RM200bn ($66bn) of assets under management.
The two funds were the only Shari’ah compliant funds offered by SUT in Sing apore and SUT did not sa y if it would introduce more Shari’ah compliant funds in the future.
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