The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
The soon-to-be-launched Calyx Islamic Strategist Fund is a global vehicle that will implement the firmÆs top-down asset allocation methodology through a basket of globally sourced Islamic funds, representing multiple asset classes, says Douglas Clark Johnson, CEO. ôItÆs the first-of-its-kind program anywhere,ö he claims.
ôOur target investors for this program are commercial banks looking to offer sharia-compliant product, Islamic insurers (takaful), and Islamic banks looking to build out wealth management businesses,ö he says. The target markets are Singapore, Malaysia and Indonesia, as well as banks in the Middle East.
Mustapha Hamat, director and CEO of the Islamic Banking and Finance Institute of Malaysia in Kuala Lumpur, is a member of the fundÆs board.
Johnson says the firm has focused on developing an Islamic investment franchise since 2005, based on initial discussions with clients in Southeast Asia and the Middle East.
But he acknowledges selling sharia-compliant products to conventional institutions remains tough work. Inertia prevents banks from developing the necessary skills for a specialized product; the business risks are harder to gauge; and the asset class remains relatively unknown.
But global consumer banks are expanding their knowledge and product base for Islamic finance, and Johnson believes that there is now enough of a track record and attention in the media to interest commercial and private banks and in sharia-compliant products. Johnson says Calyx hopes to raise up to $250 million for the fund, with an annual management fee of 1.5% plus a performance fee of 10% above a hurdle rate of 7%. HSBCÆs Bahrain branch serves as the administrator.
The Calyx Islamic Strategist Fund targets an annualized return of 8-12% with a standard deviation of 5-8%. There is a global equity component and a balanced component that includes leasing and real estate and murabaha (trade finance).
The firmÆs Islamic strategy board is comprised of independent asset managers, including Angus Blair, director of research at Beltone Financial in Cairo; Mohamed Damshal bin Awang Damit, CEO at Muamalat Avenue in Kuala Lumpur; Paul Meeks, CFO at long/short equity hedge fund NMH Advisors in New York; and Dermot Walsh, executive director at Focus Investments in Dublin.
The fundÆs sharia advisory board includes Sheikh Yusuf DeLorenzo of the United States, Mohd Daud Bakar of Malaysia and Sheikh Nizam Yaquby of Bahrain.
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