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Alliance S&P Shariah Index Fund: A meaningful vehicle of investment, says Maroof Matin

Wali-ul-Maroof Matin

Wali-ul-Maroof Matin

Alliance S&P Shariah Index Fund, the first of its kind in Bangladesh aims to bring diversification in the stock market.

“The unique features of this fund are that it is an index fund. Secondly, this is a Shariah-compliant open end fund. Furthermore, our investors will notice that this index, that the fund will follow, is provided by Standard and Poor’s. Filtered for shariah by their one and only world shariah board. This is how we have tried to bring in diversification in our market,” Wali-ul-Maroof Matin, Chairman and Managing Director of Alliance Capital Asset Management Limited, an asset management company told The FE in an interview.

He said during the last 3 years, the S&P Shariah index for Bangladesh hovered above the DSE index by 16 per cent on average.

Mentioning the objective of the fund, Mr Wali-ul said the prime objective remains the same, making profit, but in a transparent way.

Bangladesh Securities and Exchange Commission in a Commission meeting on 9 July 2013 approved the prospectus of Alliance S&P Shariah Index Fund.

Replying to a question on his optimism on the prospect of the new product, he said the fund is designed for investors but not for the traders who aspires to make “profit” in 3 days.

“Investors who want to manage their risk will find it as a meaningful vehicle of investment. We don’t give guarantee of profit. But we give the guarantee that no manipulation is possible with this fund. Therefore, real and genuine investors will come to invest here,” Mr Wali-ul said.

The initial subscription period of the fund ends on 23 October.

“During this period you are buying at the face value. Then you have to buy it at a price linked to net asset value (NAV).”

Regarding the response from the investors about the Fund, he said there remains good response from institutions, who take careful investment decisions and involve decision making procedure.

Replying to a question whether it will be a tool to be used to capitalise the cheap religious sentiment of majority Muslim investors in Bangladesh, he said : Religions are the source of old wisdom. There is no religion that does not ban interest and unethical business. The name Islamic sharia is used as it is easily understood. I wish I could name it after Hindu or Christian or Buddhist fund.

“Profit is our motive as we have followed this index .We are capitalizing on a fact that gives comfort to the investors.”

“Our first subscriber is a non-Muslim. It gave me immense pleasure. This gentleman is a connoisseur of investment. He understands the value of old wisdom and believes in the ethos that good governance can assure profit.”

Alliance Capital Asset Management Limited is both the sponsor and the asset manager of the fund while Bangladesh General Insurance Company is the trustee and BRAC Bank is the custodian.

Alliance S&P Shariah Index Fund is an open-end fund and will not be listed on the stock exchanges. The units of the fund will be sold and repurchased by the asset manager and through sales agents across the country. These sales centres will make it easy for the investors to buy, sell or transfer their units without any hassle.


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