Al Mal Eyes Promising Outlook For UAE Equities To Build On 15-year Outperformance
Leading fund manager marks 15-year track record of outperforming peers and indices in UAE equities
Al Mal Capital (“AMC”) aims to continue the stellar performance in its UAE Equity Fund due to the growing diversity in the domestic economy and with the reforms that are expected to attract more foreign investors.
Following the launch 15 years ago, the fund has created a consistent alpha by outperforming peers and indices alike. Even amid the economic challenges for the UAE in 2020 due to COVID-19 and the collapse in oil prices, the fund is up 3.3% year to date. This is particularly notable given the Dubai index has lost 11% and the Abu Dhabi index is up 3% over the same period.
Commenting on the Fund’s performance, Naser Al Nabulsi, Vice Chairman and CEO of Al Mal Capital said: “The investment landscape in 2020 was challenging across the region and globally. However, our asset management team’s stellar performance proves that active portfolio management with a skillful team, clear strategies, consistent application of investment policy and processes can outperform in challenging times.”
Being selective breeds success
“The real estate and financial sectors have been under pressure this year, the fund – which has exposure of nearly 60% to these industries – has benefited from a combination of its allocation to defensive sectors and by taking an active approach in investing in oversold names”, reveals AMC’s Head of Asset Management, Sherif El Haddad.
The fund has also benefitted from M&A activity in the UAE and continues to be positioned in businesses with good management where the firm sees strong growth potential.
Laying foundations for the future
Other reasons for optimism from a macro perspective, with proactive reforms and initiatives to drive growth going forward, comprise off the Dubai’s government’s AED500 million economic stimulus package to support various business sectors across the economy, with the package targeted to shore up SMEs, through a set of rent reductions and fee exemptions and also the Abu Dhabi government’s roll out of the anticipated FDI license, allowing foreign investors to hold 100% ownership of their businesses within the emirate
“In line with these trends and growth prospects, the fund plans to continue to pay shareholders a dividend of 4.5% of the fund’s NAV.” added El Haddad.
