Kenanga Investors has announced the launch of the Kenanga Islamic Asia Pacific (ex Japan) Total Return Fund.
The Fund is a Shariah-compliant equity fund that invests in a diversified portfolio of Shariah-compliant equities and Shariah-compliant equity related securities of companies in the Asia Pacific (ex Japan) region (APAC Region).
“Kenanga Investors is dedicated to offering our investors regional Shariah-compliant exposure, driven by robust demand from investors for a fund with an Asia Pacific focus viewed through a Shariah-compliant investing lens,” said Executive Director and CEO, Datuk Wira Ismitz Matthew De Alwis.
The Fund offers investors a unique opportunity to tap into the APAC Region’s potential for economic growth, spurred on by the region’s increasing integration into the global economy and rising affluence as its young population is lifted out of poverty into a growing middle class, among other tailwinds.
“We have observed that many countries in the APAC Region are implementing economic reforms and welcoming foreign investments, further integrating and increasing their influence on the global economy. The region is also punching above its weight globally within the fields of renewable energy, battery storage, electric vehicles, semiconductors and various other drivers of the economy of the future. Additionally, with a population of over 4.5 billion that is relatively youthful, the APAC Region is also expected to enjoy a demographic dividend over the next decade further fuelling its growth. Indeed, growth in the APAC Region is expected to outpace global growth for the next few years. Given the convergence of these positives, I believe the Fund will provide significant investment opportunities for investors particularly in areas such as technology, consumer goods and services, industrials and healthcare” added Datuk Wira De Alwis.
He also highlighted the benefit of reducing exposure to any one country or region in today’s investment climate. “Investing at a broad regional level carries the benefit of mitigating risk due of political, regulatory and economic uncertainties and improved overall portfolio performance. By investing in a range of countries in the region, investors can spread their risks of any one country’s developments on their portfolios”, he said.
The Fund utilises an absolute return strategy to provide capital appreciation over the long-term. “The Fund will be managed without benchmark constraints, which provides the flexibility to identify and implement the optimal investment strategy without single sector constraints. This includes bottom-up stock picking to select stocks with the greatest capital appreciation potential and controlled volatility,” explained Chief Investment Officer Lee Sook Yee.
The Fund’s investment process involves seeking out businesses with sustainable returns on Shariah-compliant equity (ROE), which are trading at a significant discount to their intrinsic value. “We believe ROE to be a suitable gauge of the success of a business as it provides common shareholders with a sustainable measure of how effectively their investment capital is being employed over a given period of time”, added Lee.
The Fund is suitable for investors seeking long-term capital growth and are willing to accept Shariah-compliant equity risk to obtain potentially higher returns and wish to have Shariah-compliant investments in the APAC Region with a minimum initial investment amount of RM1,000.
