• It provides attractive, sustainable returns while maintaining a commitment to ethical investing principles
• It presents growth opportunities offered by a diversified portfolio of developed market equities
• The risk management approach balances potential returns with carefully managed risk
• It invests in accordance with Shari'ah law and the principles articulated for Islamic Finance

Shari’ah-compliant funds have performed well in recent years, with many beating their non-Shari’ah counterparts. The Old Mutual Global Islamic Equity Portfolio, led by an award-winning portfolio manager, has done just that, delivering above-benchmark returns for over three- and one-year periods. This outperformance is obtained by structuring the portfolio with various constraints – emphasising portfolio resilience, while actively managing the portfolio’s volatility.

We focus on identifying and investing in high-quality companies with attractive valuations and promising long-term growth prospects. We believe that superior investment performance comes from a combination of stock selection and portfolio construction. The equity universe encompasses both local and international markets and adheres to our Managed Volatility Strategy while incorporating Shari'ah, as well as ESG, investing principles to arrive at the final portfolio.

Our portfolio construction approach prioritises allocating the maximum amount of capital to the highest-conviction stocks. In essence, if a high-quality, attractively valued company carries a higher conviction than another buy-rated company, it will receive a greater portfolio weight. In addition, we employ various constraints to maintain adequate diversification. These constraints include confidence-adjusted scores, share, sector, country, active share, and portfolio volatility. Portfolio volatility is allowed to fluctuate within a range of 0% to 20% (1 to 0.8), representing a 20% reduction in volatility compared to the benchmark, subject to the availability of forecast alpha opportunities within the universe. Sophisticated models, both proprietary and commercially available, are utilised throughout this analysis.