ALFALAH GHP ISLAMIC FUND
Profile
The Alfalah Islamic Fund is the first
Shariah Compliant fund launched by AGIM. AGIF is an open-ended fund that offers
its investors an opportunity to invest in a diversified portfolio of Shariah
Compliant investments with the objective of maximizing medium to long term
returns for a given level of risk.
The Fund seeks to achieve its investment
objective by investing funds in Shariah Compliant securities listed on the Stock
Exchanges in Pakistan and abroad, Islamic Funds overseas and other Fixed Income
Islamic instruments like Morabaha / Musharika Certificates & Sukuk Bonds.
The key benefits of investing in AGIF are
as follows:
-
Avoidance
of interest and other un-Islamic income/investment;
-
It is
an asset allocation fund. The strategy of the Fund would be to actively
manage the allocations to provide consistent returns to the investors;
-
Alfalah
GHP already has a track record of successfully managing an asset allocation
fund;
-
Tax free
investment under Government regulations.
Investment Objectives
Alfalah GHP Islamic Fund is an open end asset allocation
scheme with the primary objective of seeking long term capital appreciation
and income from a diversified portfolio developed in consistence with the principles
of Shariah. The investments in the Fund will be diversified both in terms of
securities within an asset class as well as across asset classes. The Fund can
invest upto a maximum of 80% in either Shariah complaint equity securities or
alternatively the Fund can invest upto a maximum of 80% in Shariah compliant
Income / money market instruments. The Fund will seek to actively switch between
these asset classes so as to optimize investor returns over a period of time.
The Fund is designed to provide investment alternatives
that are consistent with Islamic principles. All activities of the Fund shall
be undertaken in accordance with the Islamic Shariah as per the guidelines given
by Shariah Advisory Board of the Fund. The Fund shall not invest in any instrument
or investment that is not compliant with Shariah rules and principles.
Investment Policy
The Investment would comprise of diversified Portfolio of Shariah-Compliant
securities including Shariah-Compliant securities available outside Pakistan.
The allocation between various investment classes will depend on prevailing
market conditions and opportunities and will primarily comprise the following
asset classes:
Shariah Advisory Board
The Shariah Board of the Fund consists of eminent Islamic economic and financial
scholars. The Shariah Advisors have considerable experience in the field of
Islamic Studies. The first Shariah Board of the Fund will be comprised of:
a) Mr. Khalil Ahmed Aazami ; and
b)
Dr. Ejaz Ahmed Samadani.
The appointment of Shariah Advisors has been approved by the SECP vide its
letter No. NBFC-II/AD/AGIML/157/2007, dated February 23, 2007.
Profile of Shariah Advisory Board
Mr. Khalil Ahmed Aazami
Mr. Khalil Ahmed Aazami is an Islamic Scholar having considerable
experience in advising financial institutions on Shariah related affairs.
Currently, Mr. Khalil Ahmed Aazami is a Shariah Advisor of Bank Alfalah –
Islamic Banking and a member of Shariah Board Takaful Pakistan Limited. In
addition to this, he is teaching at Dar-ul-Uloom Karachi and Centre of Islamic
Economics.
Mr. Aazami has strong academic background in Islamic Studies and
Islamic Economics. He has completed Takhassus Fil Ifta and Shahadah Alimiyyah
from Dar-ul-Uloom Karachi, a renowned Islamic Institute of Pakistan. He is a
faculty member of Centre of Islamic Economics, Karachi & Professional Institute
of Excellence.
Dr. Ejaz Ahmed Samdani
Dr. Ejaz
Ahmed Samdani is an eminent Islamic economic scholar, and has considerable
experience in relevant field. He has completed his Ph.D/M. Phil from Karachi
University (Department of Quran & Sunnah, Faculty of Islamic Studies) in the
year 2005. Dr. Samdani has delivered many lectures about Islamic Banking and
Takaful in Bahria University, Centre for Islamic Economics (CIE), Professional
Institute of Excellence (PIE), Skill Development Council and other places. He
has worked as Audit member of Center for Islamic Economics for different Islamic
Banking Branches according to Shariah perspective. Dr. Samdani has issued about
two thousand fatawas on different Islamic topics especially in Islamic Finance
and Meeras.
Dr. Samdani was associated with Habib Bank Ltd. (Islamic Banking
Division) as a Shariah Advisor from December 2004 to November 2006.
Dr. Samdani has strong academic background in Islamic Studies and
Islamic Economics. He has completed “Al-T’khassus fi al Iftaa” from Jamia Darul
Uloom, “Shahdat ul Alimiyah fi al-Uloom al Islamiyah wa al-Arabia” 8 years
Alimiyah course and M. A in Islamic Studies from Bahauddin Zakariya University,
Multan. He has written many books on different Shariah matters and his several
research topics were published in various well renowned newspapers and
magazines.
Shariah Investment Guidelines
All
activities of the Fund shall be undertaken in accordance with the Islamic
Shariah as per the guidelines given by Shariah Advisory Board of the Fund. The
Fund shall not invest in any instrument or investment that is not compliant with
Shariah rules and principles.
Alfalah GHP Islamic Fund plans to use the following criteria to
ensure that their stock selection adheres to Shariah investment guidelines:
-
Business of the Investee company (Sector Restriction)
The basic business of the investee company
should be Halal. Accordingly, investment in shares of conventional banks,
insurance companies, leasing companies, companies dealing in alcohol,
tobacco, pornography, etc. are not permissible.
-
Financial Ratios (Financial Restriction)
Total Debt to Total Assets
The total debt of the Investee Company should
not exceed 45% of the total assets
lliquid to Total Assets
The total illiquid assets of the Investee
Company as a percentage of the total assets should be at least 10%.
Investment in Shariah non-compliant activities
and income from Shariah non-compliant investments.
The following two conditions will be observed
for screening purposes:
.i. The total investment of the Investee Company in Shariah non- compliant
business should not exceed 33% of its total assets.
.ii. The income from Shariah non-compliant investment should not exceed
5% of the gross revenue of the Investee Company. (Gross revenue means net
sales plus other income).
Net liquid Assets vs. Share Price
The net liquid assets (Total assets –
(Tangible Fixed Assets + Inventory) - current liabilities) per share be
less than the market price per share.
Characteristics of Units
|
Minimum Investment |
PKR 5,000 |
|
Subsequent |
PKR 1,000 |
|
Front-end Load |
2. 50% |
|
Back-end Load |
0.00% |
|
Management fee |
The current level of management fees
is 2.25% (two hundred and twenty five basis points) per annum of the
average daily Net Assets Value of AGIF |
Payment for Purchase of Units
Payment for the Fund Units can be made in the form of:
-
Cheque
(marked “Account Payee Only” in favor of “CDC-Trustee Alfalah GHP Islamic Fund”);
-
Demand
draft or Pay-order in favor of “CDC-Trustee Alfalah GHP
Islamic Fund”;
-
Online
transfer of money.
Payment for Redemption of Units
Payment of the redemption proceeds will be made by a cross cheque,
in favor of Unit Holder’s registered name, and will be sent to registered
address of the Unit Holder within six (6) Business Days of the receipt of a
properly documented request for redemption of Units
Distribution
Policy
The net amount
available for distribution at the end of the financial year (or such interim
period as may be decided by the Management Company), shall comprise of the
revenues earned by the Fund including the net impact of the revenue collected
and paid out in the NAV calculation through Purchase (Offer) and Redemption
(Repurchase) of Units, less all expenses incurred or accrued attributable to the
Fund.
The Fund may
distribute 90% of the amount available for distribution or any other payout
ratio as bonus Units or cash dividends in order to avail tax exemption or any
other benefits in the interest of the Unit Holder
Disclaimer
Prices of Units
of the Fund and income from them may go up or down.
Under exceptional
(extraordinary) circumstances, the Management Company may declare suspension of
redemptions, invoke a queue system or announce winding-up. In such events the
investor will probably have to wait for payment beyond the normal period and the
redemption amount so determined may be lower than the price at the time the
redemption request is lodged. Investors are advised to read the relevant clauses
of the Fund’s Trust Deed for more detailed information regarding this clause.
The Units of the
Trust are not bank deposits and are neither issued by, insured by, obligations
of, nor otherwise supported by the SECP, any Government agency, the Trustee
(except to the extent specifically stated in this document and the Trust Deed)
or any of the shareholders of the Management Company or any of the Core
Investors or any other bank or financial institution.
