Demand for Sharia-compliant investment alternatives remains strong, according to Hejaz Financial Services.
Hejaz Financial Services has reported a boost to the funds under management (FUM) of its Hejaz Income Fund by 58 per cent year-on-year.
The actively managed fund, which was recently awarded a ‘superior’ 4-star investment rating from independent research house SQM Research, is designed to help generate a steady income stream while maintaining the highest Sharia investment standards.
A disciplined review process and ethical screens are used to identify and assess the most appropriate opportunities and all proposed investments undergo a strict Sharia-compliant testing to ensure eligibility.
Hejaz explained that Sharia-compliant investing refers to ethical investment in products, companies and industries that align with Islamic beliefs.
“Our aim is to educate the market and show Muslims that their faith does not have to be a barrier to investing, wealth creation and long-term financial security,” commented Hejaz Financial Services COO Muzzammil Dhedhy.
“The performance of our Hejaz Income Fund and SQM’s high investment grade rating is proof that when you invest with the values and beliefs of your customers at the core, together you can deliver great results.”
The fund invests in compliant secured private financing, asset-backed investments, property and corporate financing.
Rules set by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) prevent investment in conventional banking and insurance, alcohol, pork and all non-Halal food items, gambling, tobacco, adult entertainment, conventional derivatives and weapons as well as all other impermissible actions as decided by the Sharia Supervisory Board.
In its rating decision, SQM Research pointed to the “high calibre” management of the fund and its meaningful historical performance.
Additionally, the firm said that the Hejaz Income Fund has an appreciable potential to outperform over the medium-to-long term and is of a “high investment grade” suitable for APL inclusion.
Since its inception in 2018, the fund has delivered an annualised net return of 5.36 per cent against a targeted net return of 5 to 7 per cent after fees and before taxes.
Hejaz announced an expansion to its senior leadership team late last year as the firm moves towards its goal of becoming the first licensed Islamic bank in Australia.
The approximately 1.2 million Muslims in Australia represent an estimated market of $192 billion, according to Hejaz founder and CEO Hakan Ozyon.
“These people want to save, invest and buy houses just like other Aussies and our ambition is to be able to provide a full range of services to help them achieve their financial ambitions in a way that doesn’t compromise their beliefs,” Mr Ozyon said in December.
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.
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