Al Rajhi Banking & Investment Corporation (Malaysia) Bhd (alrajhi bank Malaysia) announced a strategic partnership with AHAM Asset Management Berhad (AHAM Capital, formerly known as Affin Hwang Asset Management Berhad) to expand its suite of Shariah-compliant wealth offerings to help clients meet their distinct investment needs in a changing landscape.
The partnership will combine alrajhi bank Malaysia’s wide business network as well as AHAM Capital’s investment capabilities to provide greater value to clients in building a globally diversified portfolio that is capable of weathering through fluctuating market cycles.
alrajhi bank Malaysia first onboarded the AHAM Shariah Gold Tracker Fund (“the Fund”), which is an open-ended retail feeder fund that aims to provide investors with investment results that closely track the performance of gold prices. The Fund feeds into an exchange-traded fund (ETF), namely the TradePlus Shariah Gold Tracker, which is managed by AHAM Capital.
alrajhi bank Malaysia Chief Executive Officer Arsalaan (Oz) Ahmed said, “We are pleased to roll out the AHAM Shariah Gold Tracker to the market, as this will enhance the Bank’s overall product offerings and provide a broader suite of solutions for our investors. For investors, the fund will provide them a Shariah-compliant initial access to gain exposure to gold, which is a commodity during financial crises. It will also provide investors with investment results that closely mirror the movement of gold prices.
Chan Ai Mei, Chief Officer, Intermediary Distribution & PRS, AHAM Capital said, “We look forward to forging a close alliance with our new distribution partner alrajhi bank Malaysia and rolling-out a steady pipeline of investment solutions, as well as strategiesto clients. Against a backdrop of market volatility and frequent geopolitical flare-ups, diversification is crucial for investors to manage risk in their portfolio and smoothen returns. As a long-term store of value, gold offers a refuge for investors by providing capital preservation alongside its role as a natural hedge due to its low correlation to other asset classes.”
Established in 2001, AHAM Capital is an independently managed, institutionally owned asset and wealth management company. With total assets under administration (AUA) of RM80 billion as of 30 June 2023, the company has served the needs of corporates, institutions, pension funds, high-net worth individuals, and the mass affluent over the years to build and preserve wealth.
The Fund is suitable for investors who seek exposure into gold through a Shariah-compliant structure and have a moderate risk tolerance level. To achieve its investment objective, the Fund can invest up to 90% of its Net Asset Value (NAV) in the TradePlus Shariah Gold Tracker (Target Fund) and a maximum of 10% of its NAV in Islamic money market instruments and/or Islamic deposits.
In addition, the Fund may invest in Islamic derivatives such as Islamic forward contracts and Islamic swaps to hedge the foreign exchange movements between the Fund and the Target Fund. While the hedging strategy will focus on reducing the potential foreign exchange losses by the Fund, any potential gains from the hedging strategy will be capped as well.