Markaz Gulf Fund Achieves Record ROI, Closed Year 2007 With Gains In Excess of 48%


Markaz announced that Markaz Gulf Fund posted 48.4% YTD outperforming MSCI GCC index which achieved 44.8% as of 31 December 2007. The main objective of Markaz Gulf Fund is to seek long term appreciation by investing principally in equity securities listed on the stock markets of the GCC countries.

The success of the Fund's investment strategy lies in the diversification of its asset allocation. In terms of geographical allocation, a high percentage of the Fund's assets were allocated at the start of 2008, almost equally among the stock markets of UAE, Kuwait, KSA and Qatar, followed by the Omani stock with a lower percentage, the lowest allocation was to the Bahraini Market. With regards to sectoral diversification a higher percentage was allocated to the industry sector, both in Saudi and Qatar, represented by the petrochemical companies mainly SABIC and Qatar Industries, the banking sector in Kuwait represented by the National Bank of Kuwait (NBK) and Kuwait Finance House (KFH), followed by the real estate sector in the UAE represented by EMAAR . The Fund's Management team invests 60 - 65% of the Fund's assets in large cap blue chip companies in the region, and, 35 - 40% to active trading and Initial Public Offerings. Mr. Bader Al-Ghanim, Vice President - Local and GCC Investments of Markaz said “We can proudly say that the performance of Markaz Gulf Fund in 2007 came as one of the best in its class not only in Kuwait but also on the regional level. This represents an addition to Markaz many acclaimed successes in asset management". Al-Ghanim added "Building proactive research driven investment decisions is one of the main factors contributing to this achievement.For instance, until the end of Q3 2007, a major allocation between 35 - 45% was to the Kuwaiti Market which was showing the best performance among all the GCC Markets. In Q4 2007 Kuwait allocation was scaled down to 20%, increasing the allocation to KSA, UAE, and Qatar. We, also increased the allocation in the Omani Market, which showed a robust growth”. From a larger point of view, we find the gulf region enjoying many positive factors. The high crude oil price is a big sentimental factor for the markets which led to rebounding the economy and increasing levels of liquidity. Increased governmental spending on economics projects developments, attractive stocks evaluations, new economic regulations, which contribute in attracting foreign investments, as well as the ambitious growth plans of companies leading to more mergers and acquisitions (M&A). Mr. Alghanim concluded with Markaz's outlook of GCC Markets in 2008 “The stocks evaluations are still attractive in the GCC Markets giving a room for a potential growth this year, and boosting the performance of the markets by 15 - 20%”. The Fund is accessible to all nationalities with a minimum subscription of 1000 units, the Net Asset Value of the unit is USD 3.59 as of 31 December 2007. The subscription and redemption are monthly. Kuwait Financial Centre S.A.K. 'Markaz', with total assets under management of over KD 1.4 billion as of September 30, 2007, was established in 1974 and 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; and has been awarded a BBB+ corporate rating by Capital Intelligence Ltd. -Ends- Photo Caption: Bader Alghanim, Vice President, Local and GCC Investment - Markaz