KARACHI: UBL Fund Managers will be launching the second Shariah Compliant fund under its “Constant Proportion Portfolio Insurance” CPPI based series by the name of UBL Islamic Principal Preservation Fund II UIPPF II this month.
This fund has three successful predecessors, one Islamic and two conventional in nature; namely, UBL Islamic Principal Preservation Fund I and UBL Principal Protected Fund I & II respectively, all of which received exceptional investor interest.
Mir Mohammad Ali, CEO UBL Funds during the launch said “Our Shariah Advisors, Mufti Mohammad Hassaan Kaleem and Mufti Muhammad Najeeb Khan have approved of this fund as per the guidelines of Shariah, ensuring that our investors reap Riba-Free returns while preserving their principal investments.”
UBL Islamic Principal Preservation Fund II, like its counterparts; boasts unique profit locking feature whereby the profits can be realized if any at various intervals during the two year life of the fund. Along with preservation of the principal investment, the Constant Proportion Portfolio Insurance CPPI methodology also aims to provide up to 100% exposure to the equity market as it gets dynamically allocated between Shariah Compliant Equity and Income / Money Market Mutual Funds.
Based on this methodology, the allocation of funds to equities will largely increase in case of a rise in the stock market. While exposure to Income/Money Market will increase in case of fall in the stock market; hence preserving the principal investment.
The Fund primarily will be investing in UBL Shariah Stock Fund USSF to take exposure in Equities, while UBL Islamic Sovereign Fund and UBL Islamic Cash Fund will be used to take exposure in Income or Money Market Instruments. The dynamic allocation of the funds provides opportunity for higher returns through participation in equities while aiming to safeguard the capital from downside risk of through participation in Income or Money Market Funds.
The Karachi Stock Exchange index KSE100 index has given an average annual return of 19.48% in the last ten years June 2003 – June 2013; outperforming other publically available investment avenues. Funds like UIPPF II are an opportunity for investors seeking attractive returns along with principal preservation in case of market volatility.
UIPPF II has a minimum subscription amount of PKR 10,000/ and the fund is currently open for receiving Pre IPO investments. UBL Fund Managers has always been the trendsetter for introducing need based products for each target profile of the audience. As an AMC offering the largest portfolio of funds and plans, UBL Funds has also been the pioneer in offering first of its kind mutual funds and methodologies, which has become the emblem of success in the asset management industry.
Established in 2001 and regulated by the Securities and Exchange Commission of Pakistan, UBL Fund Managers has been one of the leading asset management companies of Pakistan for over a decade, and now has presence in the Middle East as well. It has also been given the prestigious High Management Quality Rating of AM2 by JCRVIS Credit Rating Company