Nomura Malaysia unveils its first ESG syariah fund


“We believe there will be good growth in these sorts of investments, moving forward,” said Nomura Asset Management Malaysia Sdn Bhd managing director and country head Leslie Yap.

KUALA LUMPUR: The appetite for sustainable investments is strong and Nomura’s assets under management (AUM) in this space is poised to grow further.

Nomura Asset Management said the sustainable or environmental, social and governance (ESG) funds currently constitutes about 10% of its total worldwide AUM.

“We believe there will be good growth in these sorts of investments, moving forward,” said Nomura Asset Management Malaysia Sdn Bhd managing director and country head Leslie Yap.

The local unit yesterday launched its first ESG syariah fund, called the Nomura Global Shariah Sustainable Equity Fund, which targets investors with a medium-risk appetite profile.

Yap said there is demand for such funds even during an overall worldwide equity market correction which could present investment opportunities in good stocks.

“While markets may be in a correction environment, this doesn’t stop us from doing our work and this is the time we can find quality companies which are discounted relative to their valuation,” he said.

The Nomura Global Shariah Sustainable Equity Fund is available for purchase in Malaysia now for a minimum initial investment of RM1,000 and US$1,000 (RM4,400) for the ringgit and US dollar investment class, respectively.

The minimum additional investments would be RM500 and US$500 (RM2,200) respectively.

Yap said the fund is targeting an initial AUM of RM50mil within the first two years of its launch.

According to its prospectus, the fund aims to invest a minimum of 70% of its net asset value (NAV) in syariah-compliant equities and the remaining 30% in Islamic liquid assets such as fixed income or held in cash.

The sales charge will be up to 3% of the NAV per unit and a management fee of up to 1.6% of the NAV per year is applicable, it said.

Nomura Asset Management UK Ltd is the investment adviser and will provide investment research and stock recommendations for the fund.

“We launched this fund given that Malaysia is an Islamic finance hub. Some of our corporate institutional clients have indicated their interest in this product – and this is how this came about,” Yap said.

“This product will be mainly invested in the developed markets such as the United States, Europe and Japan. It also gives investors an alternative to diversify their investments,” he added.

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