Shari'ah BalancedThis Shari’ah compliant multi-asset class portfolio offers investors access to local and global investments, including equity, liquid assets and non-equity securities, such as sukuks (Islamic bonds). In accordance with Islamic investment principles, the portfolio excludes companies whose core businesses involve dealing in alcohol, gambling, non-halaal foodstuffs or interest-bearing instruments.
The solution aims to provide investors with a valuable source of alternative alpha, along with a low correlation to other multi-asset class strategies. To achieve this, the portfolio managers build well-diversified portfolios containing listed shares (high quality, attractively valued companies with favourable long-term growth prospects), liquid assets and sukuks.
Portfolio volatility is actively managed from aggressive (high) to defensive (low). There are market cycles when, due to the behavioural excesses of investors (such as greed or fear), higher absolute risk is attractively compensated and periods where lower absolute risk is attractively compensated. Dynamically managing the volatility of the portfolio’s absolute risk relative to the benchmark can provide a valuable additional source of outperformance over the long term.
This solution is suitable for investors seeking a diversified and an ethical investment and who can tolerate potential short-term market fluctuations in pursuit of significant real growth relative to inflation over the long term.
The portfolio complies with Regulation 28 of the Pension Funds Act.
Benchmark: 45% Customised SA Shari’ah Equity Index. 10% S&P Developed Markets Large & Mid-Cap Shari’ah Index. 40% STeFI Composite: 0.5% & 5% Three-month US Dollar LIBOR
Objective: The solution aims to outperform the benchmark over rolling three-year periods, while seeking to efficiently manage absolute portfolio volatility.