Australian Islamic equity fund makes twofold gains in the third quarter of 2013 - IFN

Australian Islamic equity fund makes twofold gains in the third quarter of 2013

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AUSTRALIA: The Crescent Australian Equity Fund (CAEF), Australia’s first Shariah compliant equity fund which was established by Crescent Wealth (Crescent), has recorded a twofold yield in the third quarter of 2013. The fund logged a 23% return for the said quarter, exceeding the 10.3% gain on the ASX 300 over the same period. CAEF was ranked as the world’s best performing Islamic equities fund according to Bloomberg. It also topped the Australian equities fund on Morningstar for the quarter ended the 30th September. Commenting on the achievement, Talal Yassine, the managing director of Crescent, said: “There is enormous potential for Islamic funds in Australia mirroring the significant expansion we have seen in similar funds overseas.” Issam Eid, the portfolio manager for CAEF, explained that the high returns were attributed to the fund’s exposure to small caps during the quarter and individual stock picking, particularly within the resources, energy and mining services sectors. “We took the view that valuations of large caps and defensive stocks on the Australian exchange looked expensive and we positioned our portfolio accordingly. Our fund is also precluded from investing in banks which proved to be advantageous as those stocks came off somewhat during the period,” said Issam. Crescent’s equities fund capitalizes its investments in gold, iron ore, mining services, residential property and information technology. In the next six to 12 months, Issam expects to see a positive development to the CAEF portfolio and anticipates that the fund will continue to perform well on the back of its exposure to natural resources mining and consumer products. The Islamic fund was kick-started with an initial investment of US$5.5 million from risk manager Aon Hewitt and was intended to focus mainly on resources. Last year, the firm partnered with Bank of London and The Middle East to provide investors of the Crescent Islamic Cash Management Fund with exposure to Sukuk investments through a portfolio managed by the bank. In 2012, Crescent also introduced the Shariah compliant superannuation fund in collaboration with the Association of Independently Owned Financial Professionals of Australia.