Kuwait Financial Centre “Markaz” announced that Markaz Arabian Fund “MAF” achieved an annual return of 27.9% for the year 2013 beating the S&P Pan Arab Benchmark with an active return of 1.3% net of fees. Markaz attributes gains to better stock selection and conservative sector allocation, which kept the volatility and downside risk range bound within each of the countries invested.
In assessing the 2013 performance, Markaz noted that major performance catalysts in Arabian markets included the positive outlook for Saudi Government initiatives, Dubai’s strong rebound of Real Estate sector combined with its healthy corporate earnings, and MSCI decision to include UAE and Qatar in its Emerging markets index.
Moreover, GCC States’ increased investments in non-oil sectors in addition to Qatar and Oman markets moved sentiments on higher dividend yields has played a key role in boosting the GCC markets’ performance. Other international factors included US equities extended global gains which trickled across the GCC.
Markaz Arabian Fund “MAF” was overweight in UAE and Qatar while staying on the sidelines in Egypt. This allocation served a comfortable risk-reward construction to the investors due to the fund’s positioning with nil to least exposure to politically troubled countries. The MAF’s top performers were heavyweights such as EMAR Properties, FGB, SABIC and Al Rajhi Bank, which were in line with the Fund’s strategy to pick stocks with high liquidity and growth potential.
Markaz expects GCC stock markets to start 2014 on a strong note because of positive trends in overseas markets and expectations for solid global economic growth. The drivers that will keep the regional markets buoyant in 2014 include continued spending by GCC governments, implementation of the MSCI decision to upgrade UAE and Qatar, Dubai World Expo 2020, and the strong fundamentals of GCC economies.
The MAF is poised to take advantage of higher sector allocations in Basic Materials, Banks and Consumer retail and the Fund continues to double down on due diligence and fine-tune the bubble avoidance radar, with an optimistic outlook for the Arabian markets.
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About Kuwait Financial Centre “Markaz”
Kuwait Financial Centre K.P.S.C “Markaz”, with total assets under management of over KD 1.04 billion as of September 30, 201 3 , was established in 1974 has become one of the leading asset management and investment banking institutions in the Arabian Gulf Region. Markaz was listed on the Kuwait Stock Exchange (KSE) in 1997.