The Dubai Multi Commodities Centre Authority and Shariah Capital have launched the Dubai Shariah Hedge Fund Index, which they say is the first internationally-recognised index comprised
The Dubai Multi Commodities Centre Authority and Shariah Capital have launched the Dubai Shariah Hedge Fund Index, which they say is the first internationally-recognised index comprised exclusively of Shariah compliant hedge funds.
The Dubai Shariah Hedge Fund Index will be calculated and reported by Thomson Reuters.
The index reflects the performance of the DSAM Kauthar Commodity Fund (DKCF).
DKCF is an equally-weighted fund-of-funds comprised initially of four single-strategy, commodity-focused funds that invest exclusively in Shariah compliant long/short equity hedge funds on the Al Safi Trust platform.
The Al Safi Trust is a Shariah compliant platform designed specifically for hedge funds and launched recently by Barclays Capital and Shariah Capital.
Distributed under the DSAM Kauthar label, the four funds underlying the index have been seeded with USD50m each by Dubai Multi Commodities Centre Authority.
They are: 25 per cent DSAM Kauthar Gold Fund, 25 per cent DSAM Kauthar Energy Fund, 25 per cent DSAM Kauthar Natural Resources Fund, 25 per cent DSAM Kauthar Global Resources & Mining Fund and 100 per cent Dubai Shariah Hedge Fund Index = DSAM Kauthar Commodity Fund.
The Dubai Shariah Hedge Fund Index itself is not an investable vehicle. However, it mirrors the returns of the DSAM Kauthar Commodity Fund which is open to institutional and individual investors on a monthly basis.
The index will be disseminated to over 300,000 traders and investors throughout the world who subscribe to news and market information from Thomson Reuters.
Islamic investors can use the index to compare the performance of their other professionally-managed absolute return investments and to determine strategies that include diversification into commodities such as those covered by the index.
DSAM, or Dubai Shariah Asset Management, is a joint venture between Dubai Commodity Asset Management, a wholly-owned subsidiary of Dubai Multi Commodities Centre Authority, and Shariah Capital, a publicly-traded company that creates and customises Shariah compliant products and platforms.
Ahmed Bin Sulayem, executive chairman of Dubai Multi Commodities Centre Authority says: ‘The purpose of the Dubai Shariah Hedge Fund index is twofold. First, it provides a benchmark for investors in Shariah compliant hedge funds who are looking for absolute investment returns, particularly in commodities, during periods of market volatility. Secondly, it reconfirms Dubai’s leadership role in Islamic finance by its support of innovative solutions for those interested in Shariah compliant investment products, like the DSAM Kauthar funds. The Dubai Shariah Hedge Fund Index represents another significant step for Islamic finance into the mainstream of global investing.’
