i-VCAP eyes second ETF on Bursa for 2015

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KUALA LUMPUR: i-VCAP Management Sdn Bhd, a wholly-owned subsidiary of ValueCAP Sdn Bhd, plans to list at least one more exchange-traded fund (ETF) on Bursa Malaysia this year, following the launch of the world’s first Islamic Asean ETF yesterday.

i-VCAP chief executive officer Mahdzir Othman said the company has already obtained approval from the Securities Commission Malaysia for its upcoming ETF, but did not elaborate.

Currently, i-VCAP has assets under management of RM1.1 billion, which it intends to double over the next two years. Its ETF products account for RM350 million of its assets.

i-VCAP yesterday launched MyETF MSCI SEA Islamic dividend (MyETF-MSEAD) — the company’s third ETF and Malaysia’s seventh — which is slated for listing on May 7 this year.

MyETF-MSEAD is an open-ended fund with an approved fund size of 500 million units, and is open for subscription until April 22.

“Like other ETFs, MyETF-MSEAD’s objective is to track the designated benchmark index, and in this case, the MSCI Southeast Asia IMI Islamic High Dividend Yield 10/40 Index,” Mahdzir told reporters after the launch yesterday.

“Essentially, the benchmark index is a customised price-return index published by MSCI. It is free-flow market capitalisation weighted and designed to reflect the performance of the large- and mid-cap segments of regional syariah-compliant securities,” he said.

Currently, the index comprises 22 stocks of companies listed in Malaysia, Singapore, Thailand, the Philippines and Indonesia. The index components could comprise between 16 and 30 stocks from the five countries.

The majority of the stocks on the index are listed in Malaysia, contributing to 35.7% of the index, followed by Singapore (32%), Thailand (17.7%), the Philippines (8.8%) and Indonesia (5.8%).

By sector, stocks in the telecommunications, industrial, financial, and energy segments account for the majority of the index, making up 31.7%, 18.1%, 15.9% and 11.3% respectively.

Mahdzir said MyETF-MSEAD aims to give returns of around 4%, after accounting for management fees.

ValueCAP is jointly owned by Khazanah Nasional Bhd, Kumpulan Wang Persaraan (Diperbadankan) and Permodalan Nasional Bhd.


This article first appeared in The Edge Financial Daily, on April 9, 2015.