Learn about key benefits of Alkhabeer Diversified Income Traded Fund

Advantages of Alkhabeer Diversified Income Traded Fund 

Advantage 

Details 

Diversified sources of income 

The fund's unit holders get the opportunity to benefit from various sources of returns by investing in a number of income-generating assets, such as sukuk, trade finance deals, Ijarah deals, income funds, and Murabaha. 

Periodic profit distribution 

The fund's unit holders benefit from the recurring income represented by the periodic returns distributed by the fund manager, which are expected to exceed the interest rates (LIBOR) for a period of 12 months +300 basis points. 

Profit distribution policy 

It is targeted to distribute semi-annual cash dividends twice a year -- in August and February every fiscal year. 

Liquidity  

The closed-end traded funds are characterized by high liquidity, as units can be bought and sold in the Saudi Stock Exchange (Tadawul) throughout the trading periods. 

High governance and transparency 

High governance and transparency systems apply to closed-end investment funds, where important developments of the fund are announced periodically, financial statements are made available to the public and other matters of interest to the investor and unit holder to take the appropriate investment decision. 

Competence of investment brokers and fund managers 

Investments in different asset classes depend on the in-depth studies that are conducted by the fund manager, as the fund manager has contacted about 94 asset managers around the world to provide the most appropriate executing brokers to achieve the fund’s objectives in terms of investment in the areas of trade finance and leasing. 

First of its kind 

The fund is the first of its kind in the region, as it represents a new investment solution for unit holders to take advantage of multiple investment tools and opportunities to provide periodic returns, potential capital growth and provide liquidity. The fund's structure also helps the fund manager to exit from credit securities at the end of their term without the need to sell them at prices below their fair value to provide liquidity. 

Investing in sukuk issued by sovereign, quasi-sovereign entities or large companies around the world 

Fund unit holders get an opportunity to benefit from investment returns in sukuk, which are issued by sovereign or quasi-sovereign entities or large companies around the world, and are invested in mostly by institutional investors. Accordingly, unit holders benefit from the returns and diversification of these sukuk. 

Investing in trade finance 

The fund’s unit holders get an opportunity to benefit from the returns on investment in trade finance, which are deals that are made for the purpose of taking advantage of short-term financing for borrowers from sovereign bodies or international companies who aim to benefit from the financing to facilitate cash flows to support their business. Therefore, the unit holders benefit from these deals which are not available to the public. 

Investing in Ijarah 

Fund unit holders get an opportunity to benefit from the returns on investment in Ijarah. Large companies benefit from Ijarah (leasing) deals, as they relieve financial burdens on the company's budget by owning assets, providing liquidity, and enabling them to acquire the necessary tools to facilitate the production process and/or provide services to their clients. Accordingly, the unit holders benefit from the returns and diversification of leasing operations, as the fund becomes one of the beneficiaries of leasing and selling such equipment. 

Investing in income funds 

The fund provides the opportunity for unit holders to benefit from the fund's investments in global income-generating funds managed by investment managers with a reliable financial reputation in global markets. Accordingly, this investment adds more diversification in securities, markets, experiences, and returns.