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This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on August 27, 2018 - September 02, 2018.
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The Arabesque Systematic fund (USD) is a balanced global equity fund that uses environmental, social and governance (ESG) principles to screen stocks to invest in. The fund had generated a return of 9.38% per annum (as at June) since its inception in September 2014. It had outperformed its benchmark, the MSCI All Country World Index (ACWI), which rose 6.74% during the period.

The fund had a Sharpe ratio of 0.99 and a maximum drawdown of 12.33%. By comparison, the MSCI ACWI’s Sharpe ratio and maximum drawdown were 0.55 and 19.2% respectively, according to its fund fact sheet.

The top five holdings of the fund  were Lululemon Athletica (1.3%), Shenzhou International Group (1.3%), Green Dot Corporation Class (1.2%), Medifast (1.2%) and Andario Petroleum (1.2%).

Lululemon Athletica is a Canadian sport apparel retailer. Shenzhou International is a Chinese clothing manufacturer. Green Dot Corporation is a US-based financial technology and bank holding company. Medifast is an American nutrition and weight loss company.   Andario Petroleum is an American company involved in petroleum and natural gas exploration and production.

 The Arabesque Q3.17 Systematic Islamic fund (USD) also outperformed the benchmark MSCI ACWI. The fund had generated a return of 10.31% per annum since its inception in September2015. It had a Sharpe ratio and maximum drawdown of 0.99 and  12.38% respectively.

The top five holdings of the fund were Amedisys Inc (1.1%), Medifast Inc (1.1%), Lululemon Athletica Inc (1.1%), Align Technology Inc (1.1%) and Terumo Corp (1%). Amedisys is a US-based provider of home health and hospice services, including practical nursing services and physical and occupational therapy. US-based Align Technology manufactures 3D digital scanners and clear aligners used in orthodontics. Japan-based Terumo Corp produces medical thermometers.  

In Malaysia, BIMB Investment Management Bhd has partnered Arabesque to launch the BIMB-Arabesque i Global Dividend Fund 1 and BIMB-Arabesque Malaysia Shariah ESG Equity Fund.

As at July 27, the BIMB-Arabesque i Global Dividend Fund 1 was ranked the top performing fund in the Equity Global (Islamic) category of the Lipper Fund Table. It had generated a return of 11.19% over the previous 12 months — the highest among its six other peers. Its top five holdings were the same as those of the Arabesque Systematic USA Fund.

The BIMB-Arabesque Malaysia Shariah ESG Equity Fund was ranked No 5 out of the 60 funds in the Equity Malaysia (Islamic) category of the Lipper Fund Table. It had generated a return of 4.97% over the past year.

The top five holdings of the fund were Padini Bhd (2.7%), Gap Inc (2.6%), TJX Companies Inc (2.3%), Petronas Dagangan Bhd (2.3%) and Texas Instruments Inc (2.3%). Padini sells men’s and ladies’ shoes, accessories, garments and ancillary products. Gap and TJX are US-based apparel retailers. Petronas Dagangan is involved in the retail of downstream oil and gas products. Texas Instruments is an American technology company that designs and manufactures semiconductors.

The minimum investment amounts for the BIMB-Arabesque i Global Dividend Fund 1 and BIMB-Arabesque Malaysia Shariah ESG Equity Fund are RM10,000 and RM500 respectively.