JOHCM launches new Shariah global equity fund
J O Hambro Capital Management (JOHCM), announces the launch of the J O Hambro Capital Management Global Select Shariah Fund, an Irish domiciled OEIC.
The fund will be managed by Nudgem Richyal as part of the family that includes the successful Global Select and International Select strategies at JOHCM.
JOHCM have been managing an institutional Global Shariah mandate since December 2013, and we have now decided to offer this to external investors through the launch of this fund. The aim of the fund is to achieve long-term total return from investing in a concentrated portfolio of global Shariah compliant securities. The team invest across the global equity universe, however they exclude companies considered uncompliant with Shariah investing such as financial services, gambling or defence. To ensure the product is fully Shariah compliant, we have a data screening provider that provides the list of Shariah compliant stocks. Separately, there is a Shariah Adviser to the fund whose role it is to monitor and review the fund structure and investments, ensure compliance with Shariah principles, and to advise on Shariah related issues.
The fund manager, Nudgem Richyal, will follow the same investment process as the International Select and Global Select strategies that he co-manages. The team uses a disciplined and distinct investment process which considers stock, sector, and country factors and how they change over time to select stocks from a Shariah compliant list. This entails looking at the behaviour of each share price to determine whether the most important driver of each prospective investment is stock specific (idiosyncratic), or whether it is the sector or the country that is the main driver. In addition, the fourth dimension is forward looking and anticipates how these relationships and correlations will change or evolve over time. Portfolio construction and risk control involves equally weighting the stock positions so every name is high conviction, but the team avoids over-confidence in a few stocks. The strongest positions are trimmed back to equal-weight with the weakest positions sold to make room for new, higher conviction stocks. The end product is a portfolio of high conviction stocks in high conviction sectors and countries. The fund will use the MSCI ACWI Islamic Index (net dividends reinvested) as a comparator benchmark.
TJ Voskamp, Head of Distribution - UK, Europe & Asia, commented: “We’re delighted to bring this product to market by adding to our very successful franchise in International and Global Select. We have seen significant interest from clients for a strategy like this and we’re excited about its potential.”
Nudgem Richyal, Portfolio Manager, said: “I am proud and excited to launch the JOHCM Global Select Shariah Fund. This has been a successful institutional mandate that we have run for over eight years and given growing client demand we felt the time was right to bring it to a wider audience. By applying the successful and long-established process within our Global and International Select Funds into a Shariah complaint vehicle we feel we can generate compelling returns for a large number of traditionally underserved clients.”