by NG MIN SHEN/ graphic by MZUKRI
MAYBANK Asset Management Sdn Bhd’s (Maybank AM) first global Shariah mixed assets fund, targets to have RM200 million worth of assets under management (AUM) by the end of 2019.
The Maybank Global Mixed Assets-I Fund, which was rolled out on June 17 this year, currently has an AUM of RM70 million.
The Shariah-compliant unit trust fund has a targeted return of 6% per annum in US dollar terms over the medium- to long-term.
Amid ongoing global market volatility and dampened domestic investor sentiment, the fund will utilise a flexible asset allocation approach of investing across markets and asset classes worldwide, Maybank AM CEO Ahmad Najib Nazlan said.
“The fund’s flexible approach aims to avoid unfavourable market sectors based on our investment outlook. As the market goes through different cycles, certain asset classes tend to perform better than others, so launching a dynamically balanced mixed asset fund is ideally suited for such an environment,” Ahmad Najib told reporters in Kuala Lumpur yesterday.
Between 30% and 80% of the funds will be allocated for global Shariah equities, 20% to 60% for global sukuk, up to 20% for diversifying assets and up to 20% held as cash and in money market instruments.
While the Shariah-compliant universe may be smaller than its conventional counterpart, it’s by no means less rewarding as Malaysia’s sukuk market has outpaced conventional bonds, the fund’s investment advisor, Schroder Investment Management (Singapore) Ltd noted.
“There is no region or sector that we stick to as we want to
remain flexible, but right now, US equities are promising due to higher quality earnings and valuations that aren’t cheap, but also not expensive historically. We also like emerging markets for their cheaper valuations and higher growth potential,” Schroder multi-asset fund manager Pang Kin Weng said.
Pang said he isn’t forecasting a recession yet either, as companies’ earnings continue o be decent and trade activity remains supportive despite global trade tensions.
“There’s a lot of pent-up demand which could be a driver for growth going forward,” he remarked.
As at end-May, Maybank AM’s parent, Maybank Asset Management Group Bhd (MAMG) had an AUM of RM24.7 billion, compared to RM33.7 billion as at September last year. Ahmad Najib attributed the outflows to the shift from wholesale money market funds to other asset classes such as fixed deposits, as investors became increasingly risk-averse amid the market downturn, coupled with attractive tax incentives.
“But we’re seeing a comeback via our bond funds and other liquidity funds, so we think this is a temporary risk aversion. Most outflows indirectly bene- fitted us to a certain extent as the majority went into our fixed income portfolio. We face a decrease in AUM, but as far as our bottomline is concerned, there’s no issue,” he said.
MAMG is a subsidiary of Malayan Banking Bhd.
“There is a business plan for us to achieve a certain amount of growth to be top five or higher within the near term. We are not ruling out either organic or inorganic growth,” Ahmad Najib said, while declining to reveal further details.