Final (1)

428 views

Published on

Published in: Economy & Finance, Business
  • Be the first to comment

  • Be the first to like this

Final (1)

  1. 1. Investment Embracing Shari’ah Principles JSE – September 2006Please refer to the Legal Disclaimer
  2. 2. Contents 1. What is Islamic Finance? 2. Development of Islamic Fund Management 3. The Oasis Experience in Islamic Fund ManagementPlease refer to the Legal Disclaimer
  3. 3. What is Islamic Finance?Please refer to the Legal Disclaimer
  4. 4. Features of Islamic Finance • Partnership - sharing Risk & Reward • discourage debt & situations of credit default • Real Assets back every transaction • discourage financial hybrids and derivatives • Avoids investing in ‘the sins’ • e.g. pork, alcohol, tobacco, gambling, etc.Please refer to the Legal Disclaimer
  5. 5. A low risk investment alternative • Speculation avoidance • no derivatives etc. • Debt avoidance • reduced interest rate risk • Asset backed investments • endure bear marketsPlease refer to the Legal Disclaimer
  6. 6. Development of Islamic FinancePlease refer to the Legal Disclaimer
  7. 7. Support & growth of Islamic finance • Gordon Brown pledged support for the growth of Islamic finance • Sukuk market had grown to $41 billion* - Expect $9 bil new sukuk’s in next 6 months* • Western Institutions are getting involved - ₤3.3 billion for Dubai Ports project - underwritten by Barclays Capital * source: Financial Times (July 2006)Please refer to the Legal Disclaimer
  8. 8. Growth in Islamic financial institutions • Fastest growing global financial sector 300 250 Institutions 200 + 55% growth 150 100 50 0 1997 2006 • In more than 75 countries (Bahrain & Malaysia the largest hubs) • Total assets exceed $250 billion and are growing at 15% a year Source: Institute for International Research, Institute for Islamic Banking & FinancePlease refer to General Council of Bank and Islamic Financial Institutions, IMF (F&D 2005) the Legal Disclaimer
  9. 9. Reasons for growth in Islamic finance • Strong demand for these products • modern investment products facilitate greater choice • low risk investment alternative avoids:  increased market volatility  high-risk speculative activity  greater potential to erode capital • Growth in wealth & education of investors • particularly in oil rich & industrialized countries • increased wealth facilitates improved educationPlease refer to the Legal Disclaimer
  10. 10. Fostering growth in Islamic finance REGULATION CREDIBLE BENCHMARKS SPECIALISATION Foundation for AND CO- universal OPERATION application Promoting ENHANCED accountability and PRODUCT transparency Increased participation of service providersPlease refer to the Legal Disclaimer
  11. 11. Regulation and transparency The Islamic Finance Framework provides: REGULATION TRANSPARENC Y • Highest global standards • Reporting performance, etc. • Increased credibility • Promotes accountability Foundation for universal application of GLOBAL FUND MANAGEMENT OPERATIONPlease refer to the Legal Disclaimer
  12. 12. Regulatory and institutional standards Saudi 1985 Organisation of the Islamic Conference (Islamic Fiqh Academy) Arabia Accounting and Auditing Organisation of Islamic Financial 1989 Bahrain Institutions (AAOIFI) Saudi 1999 Islamic Corporation for Economic Development Arabia General Council for Islamic Banks and Financial Institutions 2001 Bahrain (GCIBFI) 2002 Islamic Financial Services Board (IFSB) Malaysia 2002 Islamic International Rating Agency (IIRA) Bahrain 2002 International Islamic Financial Market (IIFM) Bahrain 2002 Liquidity Management Centre Bahrain• Collaboration with regional regulatory bodies• Aligning regulatory standards globally• Co-operating with world governing institutions (IMF, IOSCO, WB)Please refer to the Legal Disclaimer
  13. 13. Product Innovations in Islamic Finance • Islamic mutual funds (diversified across asset classes) • Equity investment products • Sukuks (Islamic bonds) • Real estate investment products • Islamic hedge funds • Short term investment instruments • Takaful (Islamic insurance)Please refer to the Legal Disclaimer
  14. 14. Growth in Islamic Mutual Funds • Islamic equity fund assets grew ± 25% between 1997 to 2003 • Total of 330 listed Islamic Investment Funds* • Products include: • Equity funds • Real estate and property funds • Murabaha funds (contract for purchasing asset by bank at cost + profit) • Commodity funds • Leasing funds * source: Eurekahedge.comPlease refer to the Legal Disclaimer
  15. 15. Oasis experience in Islamic Fund ManagementPlease refer to the Legal Disclaimer
  16. 16. At Oasis regulation is KEY… • Highest form of European Regulation - (UCITS) • Regulatory Oversight • Irish Financial Services Regulatory Authority (IFSRA) • South African Financial Services Board (FSB) • Johannesburg Stock Exchange (FTSE/JSE) • South African Reserve Bank (SARB) • Institutes & Affiliations • CFA Institute (Global) • Dublin Funds Industry Association (Ireland) • Institute of Retirement Funds (South Africa) • Association of Collective Investments (South Africa)Please refer to the Legal Disclaimer
  17. 17. … as is its Shari’ah regulation … External regulation • Accounting & Auditing Organization for Islamic Institutions (AAIOFI) • International Association for Islamic Economics (IAIE) • Islamic Financial Services Board (ISFB) • General Council for Islamic Banks & Financial Institutions (GCIBFI) Internal regulation • Independent Shari’ah Advisory BoardPlease refer to the Legal Disclaimer
  18. 18. … and investment skills are KEY KEY KEY! • Tremendous growth in Islamic finance has resulted in a dearth of Shari’ah fund management skills • Oasis has honed its Shari’ah investment skills over the last nine years – evidence of its success may be gauged from its performance • Developed infrastructure to invest in any geographic regionPlease refer to the Legal Disclaimer
  19. 19. The Crescent product range of Oasis • South African Products Equity  Property  Balanced  • Global Products Equity  Property Please refer to the Legal Disclaimer
  20. 20. Oasis Crescent Equity Fund - Performance Aug 98 YTD Since to 1999 2000 2001 2002 2003 2004 2005 2006 Inception Dec 98 July Cum Ann Oasis Crescent Equity 15.5 79.9 12.5 52.6 18.1 20.1 26.9 34.6 15.8 899.1 33.3 Fund* FTSE / JSE All Share (19.9) 70.8 0.4 32.6 (8.3) 16.1 25.5 47.3 17.0 319.1 19.6 Index Ave General Equity (21.7) 50.7 (3.5) 21.5 1.6 22.6 38.6 36.9 12.0 262.8 16.6 Fund * # 1 since inception to July 2006 Source: S&P MicropalPlease refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  21. 21. Oasis Crescent Equity Fund - Performance Sortino Sharpe Info Ratio Rank Ratio Rank Ratio Rank Oasis Crescent 5.2 1 2.6 1 2.0 2 Equity Fund FTSE-JSE All Share Index/ Average 0.9 5 0.6 14 0.4 9 Competitor (Info) Source Data: S&P Micropal & Bloomberg; Since inception to July 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  22. 22. Oasis Crescent Equity Fund - Value Add R100 Investment in the Oasis Cresent Equity Fund (Inception to July 2006) 1,200 1,000 R 999.1 Oasis Crescent Equity Fund 800 FTSE/JSE All Share Average General Equity Fund Rands 600 400 R 419.1 R 362.8 200 - Jul-99 Jul-00 Jul-01 Jul-02 Jul-03 Jul-04 Jul-05 Jul-06 Source: S&P Micropal; August 98 – July 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  23. 23. Oasis Crescent Equity - Performance Oasis 899.1 900 FTSE/JSE All Share Index 700 Overall 96 months Return (%) 500 Bear Bull 41 months 55 months 319.1 300 100 (0.4) 4.6 6.0 (4.0) (100) Source: S&P Micropal; August 98 –July 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  24. 24. Crescent Global Equity Fund – RatingsPlease refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  25. 25. Crescent Global Equity Fund – Ratings Risk/Reward Miscellaneous 3 year 5 year Vs Benchmark 3 Year 5 Year 10 Year Stnd Deviation 9.8 12.5 1 Sharpe Ratio 1.9 1.0 Alpha 5.5 10.5 - Sortino Ratio 4.3 1.7 Beta 1.0 0.8 - R-squared (%) 82.5 81.4 - Tracking Error 4.1 5.9 - Info Ratio 1.6 1.8 - Excess Return 6.6 10.5 6.1 Ratings at of 2006-07-31 Morningstar Overall 3 Year 5 Year 10 Years Rating 4* 4* 4* - Risk - 1.1 1.8 - Return - 15.8 11.2 - Investments Rated 135 135 95 -Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  26. 26. Crescent Global Equity Fund - Performance YTD Since Dec Inception 2001 2002 2003 2004 2005 2006 2000 (Aug) Cum Ann Crescent Global 0.0 (2.0) (0.7) 33.4 21.7 11.5 16.8 105.7 13.4 Equity Fund (21.5 Dow Jones IM Index (0.3) (19.2) 30.2 10.6 10.1 7.6 7.8 1.3 ) (19.5 MSCI World Index 1.6 (16.5) 33.8 15.2 10.0 9.9 27.2 4.3 ) Source: S&P Micropal; Dec 2000 – Aug 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  27. 27. Crescent Global Equity Fund - Performance Sortino Sharpe Information Ratio Ratio Ranking* Ratio Ranking* Ratio Ranking* Crescent Global Equity Fund 1.22 8th 0.98 7th 1.42 10th Dow Jones IM Index / Average (0.15) 269th 0.01 264th 0.46 127th Global Equity Fund (Info ratio) MSCI World Index / Average 0.10 137th 0.22 125th (0.30) 191st Global Equity Fund (Info ratio) Source: S&P Micropal; Dec 2000 – Jul 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  28. 28. Crescent Global Equity Fund - Value added 2.3 Crescent Global Equity Fund $2.0m n 2.0 MSCI World Index Average Global Equity Fund 1.8 $ Millions 1.5 1.3 $1.2m n $1.1m n 1.0 0.8 0.5 Jul-01 Jul-02 Jul-03 Jul-04 Jul-05 Jul-06 Source: S&P Micropal; Dec 2000 – Jul 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  29. 29. Crescent Global Equity Fund – Performance 105 97.7 OASIS Overall 85 MSCI Index 68 months 65 Return (%) 45 Bear Bull 30 months 38 months 23.9 25 3.1 2.8 5 (1.7) (3.6) (15) Source: S&P Micropal; Dec 2000 – Aug 2006Please refer to the Legal DisclaimerPlease refer to the Legal Disclaimer
  30. 30. Listing of first Shari’ah compliant property fund OASIS CRESCENT PROPERTY FUND Listed on Alt-X in November 2005Please refer to the Legal Disclaimer
  31. 31. Social contribution - Crescent Fund Trust A charitable trust uses Non-Permissable Income (NPI) to develop and promote: Dermatology Unit Health Care: Red Cross Children’s HospitalPlease refer to the Legal Disclaimer
  32. 32. Social contribution - Crescent Fund Trust Education: As Salaam • An initiative which aims to help communities accelerate the education and training of the youth through self helpPlease refer to the Legal Disclaimer
  33. 33. The future of Islamic Finance • Young rapidly growing sector • Opportunities are great • The demand is in place • The regulatory framework is in place • Prolific development of product • Products are innovative, highly regulated and transparent • The lower risk proposition is attractive • Attractive proposition for a global audiencePlease refer to the Legal Disclaimer
  34. 34. Legal Disclaimer Past performances are not necessarily an indication of future performances. No guarantees are provided. Any calculations made are approximations, meant as guidelines only, which you must confirm before relying on them and also at the time of finalising any transaction. Oasis will therefore not be held responsible for any inaccuracies in calculations supplied. All the information appearing on the slides is provided without a representation or warranty whatsoever, whether express or implied. Oasis makes no representation or warranties about the correctness or the suitability of any products or service that appear nor the soundness of any general advice offered. Oasis shall not be responsible and disclaims all liability for any loss, liability, damage (whether direct, indirect, special or consequential) or expense of any nature whatsoever, which may be suffered as a result of or which may be attributable, directly or indirectly, to the use of, or reliance upon any information, links or service provided, or any actions and/or liability for consequential or incidental damages. Oasis Asset Management and Oasis Crescent Capital Management are authorised Financial Services Providers.Please refer to the Legal Disclaimer

×