Zawya Funds Ranking is the first and only independent ranking system in the region, addressing the rising demand for accurate information, unbiased research and analysis, as well as increased transparency in the MENA funds industry.
In the second quarter of 2011, 18 funds maintained their leading positions at the top of their categories, while Tunisia Fixed Income Conventional, Morocco Money Market Conventional and Egypt Equity Islamic have new funds listed in the number one positions. The 2Q 2011 ranking consists of 16 conventional and six Islamic categories, a total of 22, an increase from the previous quarter’s 21 categories. One new category was added in 2Q 2011, which is the Tunisia Balanced Conventional.
Among the top-ranked funds in 2Q 2011 conventional categories were Markaz Arabian Fund in the MENA Equity conventional category, Gulf Gate Fund in the GCC Equity conventional category, Al Arabi Saudi Equity Fund in the Saudi Arabia Equity conventional category, Al Mal UAE Equity Fund in the UAE Equity conventional category and Arab African International Bank Investment Fund in the Egypt Equity conventional category.
Top-ranked funds in the Islamic categories include: Jadwa GCC Equity Fund in the GCC Equity Islamic category, Falcom Saudi Equity Fund in the Saudi Arabia Equity Islamic category, Sanabel Fund in the Egypt Equity Islamic category and Tharwa Islamic Fund in the Kuwait Equity Islamic category.
“It is encouraging to see 18 funds maintaining their leading positions in this quarter as this is a healthy indicator that demonstrates consistency in good fund management,” Josiane Assaad, Product Manager Mutual Funds at Zawya, said.
Additionally, during 2Q 2011, 12 new funds – eight conventional and four Islamic – were launched in MENA, of which equity funds had the largest share: six conventional and three Islamic. Following turmoil from the Arab Spring, both Egypt and Tunisia launched three funds each in an effort to boost the confidence in their local markets.
The MENA funds industry registered $67.4 billion in assets under management as of 2Q 2011 for funds domiciled in the region, a rebound of approximately $3 billion quarter-on-quarter. With a total of 246 domiciled funds and an unchanged AUM figure between 1Q and 2Q, Saudi Arabia continues to lead the way with $23.7 billion in AUM followed by Morocco with $15.3 billion and Kuwait with $8.8 billion.
In terms of funds flows and despite the challenges witnessed in the Arab region, a substantial inflow was recorded for MENA funds, totaling $518 million as of 1Q 2011 – 2Q 2011. The largest inflow in terms of geographic focus was registered in Morocco ($310 million), followed by Saudi Arabia ($242 million) and Egypt ($144 million). Of the 12 sampled asset types, five posted net inflow, while the rest showed net outflow. Fixed income funds had the largest net inflow with $321 million, while equity funds were the biggest losers with net outflow of $139 million.
The minimum fund size has been set at $5 million with three years of historical data and each category should contain a minimum of five funds. The ranking process is made up of four key components with different weights: returns (35%), volatility (15%), fees (15%) and compliance and consistency (35%).