Khaleej Equity Fund
SICO’s flagship equity fund gives investors exposure to the burgeoning GCC and wider Middle East region through a mandate to invest in six GCC markets. It seeks long-term capital growth by investing in both regional equities and equity-related, hybrid and debt instruments in the GCC.
SICO’s flagship product, the Khaleej Equity Fund (KEF), provides investors with a unique opportunity to gain exposure to the fast-growing Gulf Cooperation Council (GCC) region and other Middle Eastern markets selectively.
The primary objective of the Fund is to seek long-term capital appreciation by investing principally in equities listed in the GCC region and other selected Middle Eastern markets.
However, from time to time, the Fund may invest in equity-related, hybrid and debt instruments originating from the GCC.
Since its inception in March 2004, KEF has been one of the top performing funds in the region. Key to the Fund’s performance has been its investment philosophy.
KEF adopts a bottom-up investment approach which is backed by a research-intensive investment process. The Fund invests in companies that the Investment Team believes are fundamentally undervalued, and have a sufficient margin of safety in order to limit the downside risk of the investment.
The investment process is underpinned by fundamental research which is spearheaded by an in-house team of analysts. As bottom-up stock pickers, the Investment Team primarily focuses its efforts on understanding the fundamentals of the business, assessing the quality of management, and evaluating the downside risk to investment.
A dedicated risk management team closely monitors the performance of the Fund to ensure adherence to internal and external guidelines.
The Fund is also regularly reviewed by the Asset Management Committee which comprises senior management of SICO BSC(c). The Committee meets regularly to confirm that the Investment Manager adheres to the risk return parameters of the Fund.
KEF is annually audited by external auditors and is regulated by the Central Bank of Bahrain.
Subscription to units of the Fund is carried out on a weekly basis. A completed Subscription Agreement needs to be submitted at least two business days prior to the subscription date. Units are offered at each Subscription Day at the Net Asset Value (NAV) per unit, plus a subscription fee of up to 2% as calculated on the relevant Valuation Day. The minimum investment to the Khaleej Equity Fund is USD 100,000.
Units of KEF can be redeemed on a weekly basis provided that the Redemption Request Form is received at least two business days prior to the relevant Redemption Day.
It is the intention of the Fund Company to declare and distribute dividends to Unit holders on an annual basis. The decision to declare dividends is at the sole discretion of the Directors of the Fund, and is subject to obtaining the necessary regulatory approvals.
Fees and Expenses
The Fund’s Units are subject to the following fees and expenses:
- Subscription Fee: A subscription fee of up to 2% is charged to investors upon subscribing to Units of the Fund.
- Management Fee: The Investment Manager receives a fixed management fee of 1.5% per annum.
- Performance Fee: The Investment Manager is entitled to a performance fee of 10% of returns over and above the hurdle total rate of return of 10%, subject to high watermark.
- Administration Fee: The Administrator is entitled to a maximum fee of 0.25% per annum, subject to a minimum.
- Custody Fee: The Custodian is entitled to a maximum fee of 0.30% per annum, subject to a minimum.
The Investment Manager publishes a monthly report detailing the Net Asset Value, asset allocation, key statistics, sectoral breakdown and top holdings of the Fund. In addition, the audited financial statements are available on an annual basis upon request.
Potential Risk Factors
Investment in the Fund carries significant risk and should be regarded as long term in nature, and only suitable for investors who understand the risks involved, and who are able to withstand the loss of all or part of their invested capital.
The value of an investment in the Fund may decrease as well as increase, and there is no assurance that the Fund will be profitable or that investors in the Fund will recover any of their invested amounts. Please refer to the section “Risk Factors” in the Information Memorandum for more details.
For further information, please contact:
Telephone: +973 1751 5000
Fax: +973 1751 4000
PO Box 1331
Manama, Kingdom of Bahrain