The Kuwaiti Financial Center Company “Markaz” revealed the launch of the “Gulf Momentum Fund” (GCC Momentum Fund), as the first fund to invest in the Gulf markets according to the momentum methodology, which invests in the best performing Gulf stocks, and tracks all components of the Standard & Poor’s Composite Gulf Momentum Index.
The Gulf Momentum Fund is the first fund in the region to apply the investment mechanism according to specific factors, in which the index provider follows transparent rules in the process of selecting stocks in line with international best practices with the same methodology, taking into account liquidity levels and market depth, reports Al-Rai daily.
The fund provides individual and institutional investors with access to shares of companies with the best risk-adjusted returns, while its launch reflects Markaz’s efforts to provide innovative investment solutions and tools to its clients, with the aim of improving risk-adjusted returns for investors.
The “Gulf Momentum Fund” mechanism was developed by the Middle East and North Africa stock management team, according to research and studies that lasted over two years to verify the validity of this strategy, in cooperation with the Standard & Poor’s index provider.
Commenting on this occasion, Senior Vice President, Equity Investments Department in the Middle East and North Africa at Markaz, Mohammed Al-Ghannam, said: “We are pleased to launch the (Gulf Momentum Fund) as the first passive fund in the Gulf that follows the momentum methodology in the Gulf stock markets.
This methodology was chosen after conducting an in-depth historical and analytical study of several investment methodologies and comparing them with the main market indicators in terms of performance and risk, as this strategy met with great demand by investors in the global markets.
Over the past ten years, the S&P Gulf Momentum Index has outperformed the S&P GCC Composite Index by 1.7 percent annually.
He explained that the fund serves investors who prefer to invest in the Gulf markets with a long-term strategy to achieve good risk-adjusted returns, which enables them to benefit from the effect of compound returns, noting that this fund is a gateway to entering the inactive investment strategies of Markaz.
For his part, Fahd Al-Rasheed, Vice President, Equity Investment Management in the Middle East and North Africa region, said: “The momentum methodology in (Markaz) selects stocks according to factors and foundations that are in line with practices in global markets.
The stocks, which together represent 50 percent of the capital, are selected for the Gulf markets, in order to improve the levels of volatility. The components of the index are re-reviewed every six months, while investors can start the investment process in the fund through easy steps and with a lower management fee rate than other Gulf equity funds.
It is noteworthy that Markaz has created many investment tools and financial services, which is confirmed by the launch of unique investment portals that suit the requirements of investors.
Among these investment products is the launch of the “Markaz Excellent Returns Fund – Mumtaz”, which is the first local mutual fund, the “Markaz Real Estate Fund”, the first open-ended real estate investment fund in Kuwait, and the “Forsa Financial Fund” launched by the “Markaz” fund. The first and only one for options in the Gulf region since 2005.
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