CIMB-PRINCIPAL Asset Management Bhd has launched two syariah-compliant funds that allow investors to benefit from the commodities boom.
The new funds will give them exposure to energy, agriculture products and metals via structured products.
"The commodities story is about supply not being able to keep up with very strong demand globally, particularly from the emerging economies in Asia," chief executive Datuk Noripah Kamso said at the launch in Kuala Lumpur yesterday.
Known as the CIMB Islamic Commodities Structured Fund 1 and 2, they invest in structured products, which are principal protected when held to maturity.
This makes them ideal for investors seeking refuge from market volatility, Noripah said.She said these funds also allow investors to gain from the potential rise in commodities prices.
"The back testing of any commodities investment would show that the returns are high. Scarcity will drive up the prices," CIMB Group chief executive officer Datuk Nazir Razak said.
Chief investment officer Raymond Tang said the funds can potentially return between 10 per cent and 15 per cent per year.
Prices of commodities generally do not move in tandem with those of the stocks and bonds, Noripah said, thus they provide a useful diversification tool to investors.
The first fund is a close-end fund. It will invest at least 95 per cent of assets in a three-year Islamic Dynamic Best of Commodity Structured Product, to be issued by CIMB Investment Bank. The second fund is similar in structure, but has a five-year tenure.
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