Eastspring launches Islamic small-cap fund

KUALA LUMPUR: Eastspring Investments Bhd has introduced its Islamic small capital (small-cap) fund, which will concentrate on syariah-compliant domestic stocks with potential returns in the medium to long term.

Eastspring chief executive officer Raymond Tang Chee Kin said that to date syariah funds under management in the local market recorded an 8% growth to RM96.7 billion. In comparison, the returns of FTSE Bursa Malaysia small-cap syariah index was 73.83% while that of FTSE Bursa Malaysia KLCI was 39.56%.  

"Even though the returns of syariah index is slightly lower than the conventional stocks returns at 82.16%, we can see the gains from syariah counters improving," he told reporters after launching the Islamic Small-Cap Fund in Kuala Lumpur on Thursday.

Tang said a minimum 70% of the net asset value (NAV) would go to syariah-compliant equities and equity-related securities and a minimum 1% of asset allocation would be channeled to Islamic deposits or Islamic liquid assets.  

"The small-cap segment is under-researched and under-servingly traded beyond its intrinsic value, so Eastspring will use this opportunity to unearth these small-cap companies and exploit the pricing inefficiencies," he added.

The initial issue price for the fund is 50 sen per unit for 21 days of the initial offer period beginning Thursday.

The minimum initial investment is RM1,000 and the minimum additional investment is RM100. As at March this year, the funds managed by the company stood at RM40 billion. - Bernama