Alinma Investment opens subscription to Alinma Emerging Markets Fund

Alinma Investment Co. opened, on July 2, subscription to units of Alinma Emerging Markets Fund, a Shariah-compliant open public investment fund, for 60 days until August 31.

Alinma Emerging Markets Fund aims to achieve long-term capital growth by investing in global emerging market shares, approved by the fund's Shariah Supervisory Committee.

The offering targets collecting SAR 187.5 million in subscriptions. The fund will start operations on Sept. 14, or earlier if the minimum capital requirement of SAR 37.5 million is met.

In April, the Capital Market Authority (CMA) approved the request received from Alinma Investment to float units of Alinma Emerging Markets Fund in a public offering, Argaam earlier reported.

The fund's investment policy is mainly based on Shariah-compliant emerging global stock markets approved by the fund’s Shariah Supervisory Committee. This is through passive investment in the fund's benchmark components so that the fund's performance is almost on par with that of the benchmark before fees and expenses.

Alinma Emerging Markets Fund will invest at least 90% of its assets in all or part of the stocks that make up the benchmark index, with the same weight, which may take some time based on the liquidity and trading conditions in emerging markets, and not necessarily to be achieved within a few days. In all cases, the fund manager will seek to reach this percentage as soon as possible.

The fund is not obligated to invest in all the components of the benchmark. However, the fund manager will invest in all or part of the components of the benchmark so that the performance of the uninvested stocks does not lead to a significant deviation in the fund and benchmark’s performance.

The fund invests in Saudi riyal and other foreign currencies. The investments are evaluated based on the prevailing exchange rates.

Alinma Emerging Markets Fund reserves the right to invest in investment products and funds that invest in monetary markets managed by the fund manager or any of its affiliates. This is alongside investing in securities issued by the fund manager or any of its affiliates.

In order to manage liquidity, the fund manager will invest the available cash in Shariah-compliant monetary market instruments. This includes Murabaha and money market funds, for example but not limited to, investment funds that invest in money markets and products managed by the fund manager.

Investment with counterparties and classified securities will take place as the fund manager deems appropriate, considering the classification of the country to which the entity or the security belongs, and the financial solvency.

Securities eyed by Alinma Emerging Markets Fund are of two types. The first includes the shares of companies listed in the emerging global stock markets, and the second represents cash and monetary market instruments, including investment funds that invest in money markets.

The fund invests in securities issued or registered in Saudi Arabia, and shares of emerging global markets that are subject to a supervisory authority outside the Kingdom that is at least similar to CMA or approved thereby.

The above ratios represent the strategic ratios that the fund manager aims to achieve. 

However, due to the nature of the markets in which the fund invests, it may be temporarily unable to meet these ratios, amid inadequate liquidity for one or more shares, or due to suspended trading in a particular market for a holiday and the like, or for any other reasons. 

Consequently, the fund manager has the right to bypass these ratios to be able to achieve the target ratios. 

For More IPOs