Wahed Technologies Sdn Bhd (Wahed Invest Malaysia) today announced the collaboration with Value Partners Asset Management Malaysia Sdn Bhd (Value Partners Malaysia) in making available the recently launched world’s first Islamic ETF investing in China A-shares, VP-DJ Shariah China A-Shares 100 ETF (the China A-Shares ETF) on their platform.
The recently launched China A-Shares ETF is the world’s first Islamic ETF investing in China A-Shares tracks the performance of the Dow Jones Islamic Market China A-Shares 100 Index (“Benchmark Index”). The ETF adopts a full replication strategy by investing in Shariah-compliant A-shares, which are in line with Wahed Invest Malaysia’s value proposition in providing retail investors access to local and global Shariah-compliant investments.
Wahed Invest Malaysia is a licensed Digital Islamic Investment Manager launched in 2019 in Malaysia, and has since gathered more than 200,000 retail investors locally and worldwide.
This collaboration between Wahed Invest Malaysia and Value Partners Malaysia offers investors access to China’s market, specifically in the new economy, which comprises sectors like technology, consumption, healthcare and 5G.
Investors on Wahed’s robo advisor platform will have the ETF as part of the instruments for their portfolio construction. The allocation of the ETF will be determined by each investor’s risk level and the expected return contribution to their portfolio.
Both firms look forward to focus on innovative investment solutions for Shariah focused investors in a digitally efficient and comprehensive manner.
Syakir Hashim, CEO and Country Head of Wahed Invest Malaysia said, “The launch of the China A-Shares ETF presents a unique opportunity for Malaysian investors to participate in the growth of the second-largest economy in the world while adhering to the Shariah. By incorporating the China A-Shares ETF into Wahed’s portfolios, Wahed’s clients will be able to track the performance of the fund and achieve further diversification in maximising long-term returns based on the risk profiles.”
Taking into consideration the importance of allocation to China A-Shares in deriving portfolio returns for investors, Value Partners Malaysia welcomes the initiative of Wahed Invest Malaysia as the first and leading shariah Digital Investment Manager in Malaysia in providing an innovative approach to investment management. The Robo Advisor on the other hand is optimistic with the future of the product being made available on their platform as part of the instruments utilised for the portfolio construction for investors. It will be utilising the China A-Shares ETF as part of its portfolio construction based on the risk classification of investors to the service. By including the China A-Shares ETF, Wahed portfolios will be able to track the growth of China’s economy while still providing clients diversification through exposure in other asset classes.
“Value Partners is known as a well-recognised China investing expert for over 28 years, and has always strived to provide innovative products to our investors. Leveraging on our proven track record in investing in the China market, our new China A-Shares ETF is a unique tool for Malaysian investors to capture China’s opportunities in the new China economy and within the Shariah principles. We are very happy with the collaboration with Wahed Invest Malaysia and look forward to a closer working relationship.” said Durraini Baharuddin, Managing Director of Value Partners Malaysia.
Following the strong demand for shariah mutual funds in South East Asia, recording a compound annual growth rate of 12.4% from 2016 to 2020 (Boston-based Cerulli Associates), it is believed that this is the most opportune time to offer innovative shariah compliant instruments in an efficient way to investors.
The China A-Shares ETF provides investors exposure to Shariah-compliant stocks within the China A-Shares equity universe. Due to the quantitative criteria adopted by the index, the China A-Shares ETF will provide investors with exposure to China’s new economy and allows them to participate in the changing dynamics and positive growth trends of the economic structure, as China moves toward focusing on becoming a consumption & services-led economy. The new economy of China includes sectors like technology, consumption, healthcare and 5G.
With the recent inclusion of China A-shares into global indices, increased foreign participation in the market is expected which may lead to upward asset revaluation.