GCC Equity Funds Sluggish GCC Markets Play Spoilsport

Transcription

1 Kuwait Financial Centre Markaz GCC Equity s Sluggish GCC Markets Play Spoilsport GCC Equity funds, as a whole, performed poorly in March 2008, following the gains seen in February. This poor performance was driven by the increased allocation to Saudi Arabia (26%), which was the worst performing GCC market for the month. Equity fund performance also suffered due to weak regional market sentiment following largely negative global market cues, as illustrated in the 9.9% drop in the MSCI GCC index for the month. The funds attempted to temper this effect by lowering their respective exposures to volatile markets (through an increase in cash held) or by increasing allocation to better performing sectors within their respective country focus. Markaz Research is available on Bloomberg Type MRKZ <Go> Thomson Financial Reuters Knowledge Zawya Investor Noozz M.R. Raghu CFA, FRM Head of Research rmandagolathur@markaz.com Layla Jasem Al-Ammar Research Analyst ext LAmmar@markaz.com Kuwait Financial Centre Markaz P.O. Box 23444, Safat 13095, Kuwait Tel: Fax: markaz.com Table 1: GCC Asset Management Industry Equity funds (March 2008) Country Conventional s No. of s AUM ($Bn) Islamic s No. of s Total AUM No. of ($Bn) s AUM ($Bn) Share of Total Market Cap ($Bn) Share of Total AUM/ M.cap Saudi Arabia % % 2.0% Kuwait % % 3.1% UAE % % 0.8% Qatar NA % % 0.04% Bahrain NA % % 0.1% Oman NA % % 0.4% GCC/MENA % Total , % Table 2: Top Five Asset Managers Equity s (March 2008) Manager AUM ($ Mn) Manager Focus Market Share HSBC Saudi Arabia 3,176 Saudi Arabia 14.8% Riyad Capital 2,519 Saudi Arabia 11.8% Samba Financial Group 1,713 Saudi Arabia 8.0% Kuwait Financial Centre 1,679 Kuwait 7.8% National Bank of Abu Dhabi 1,376 UAE 6.4% Table 3: Top Five Equity s (March 2008) Geographical Focus Monthly Return 2007 Return Name YTD Kuwait Finance and Investment Al Wasm Kuwait Company 4.7% 17.6% 1.9% Dubai Growth Ltd UAE 3i Capital Group 0.9% 1.9% 5.0% Delmon Bahrain Global Investment House 0.5% 8.5% 23.0% Vision Emerging Oman Oman Vision Investment Services Co. 0.0% 14.3% 32.3% Oman Gateway Oman SHUAA Capital -0.2% 14.9% 51.8%

2 Key Highlights GCC Equity fund performance was dampened by high allocation to Saudi Arabia The downside in the GCC markets was reflected in the poor performance of GCC Equity s; no equity fund with a geographical focus on the GCC region posted positive returns in March s marginally reduced their exposure to riskier equities to 93%. As such, free cash held increased by 1 percentage point in March. performance was negatively affected as allocation to Saudi Arabia, the worst GCC market this month, increased marginally to 26%. Managers diversified their allocations in other MENA markets to reduce risk by increasing their allocation to 10%. Among Conventional funds, Gulf Equity (SICO) topped the charts with a loss of 1.8% for the month. Among Sharia-compliant funds, Riyad Gulf (Riyad Capital) topped the league, registering a MoM loss of 4.3% in March. Figure 1: Top Five Conventional s by Monthly Returns -1.8% -2.7% -3.4% -3.8% -3.9% No GCC-focused Equity fund posted a positive return in March -9.9% MSCI GCC Index SICO Gulf Equity NBD Aafaq Investment Khaleej Equity Al Ahli Gulf Figure 2: Top Five Islamic s by Monthly Returns Gulf Premier -4.3% -5.0% -5.7% -6.0% -6.0% -7.4% MSCI GCC Islamic Net Total Return Index Riyad Bank Gulf AlRajhi GCC Equity SABB Arab Islamic Amanah GCC Gateway Equity AlBasha'er GCC Equity Kuwait Financial Centre Markaz 2

3 On an asset weighted basis, GCC Equity s posted a loss of 5.2% in March 2008 Major Trends GCC Equity funds prolonged their roller-coaster trend in After starting the year on a weak note, all GCC markets performed well in February. However, several regional equity markets reversed February s gains in March in line with bleak global cues. This was reflected in the 9.9% fall in the MSCI GCC index during the month (Figure 3). Figure 3: Performance of GCC MSCI Stock Indices 0.7% -3.8% -8.3% -9.1% -9.9% -10.3% -11.6% MSCI Bahrain MSCI Oman MSCI UAE MSCI Kuwait MSCI GCC MSCI Qatar MSCI Saudi Arabia MSCI Bahrain outperformed other While country-specific Kuwait posted MSCI MoM indices returns in March of 2.0%, 2008 Saudi posted a loss of 11.2% in March Negative sentiment and a volatile global market pulled down all countryspecific MSCI indices except the MSCI Bahrain Index, which increased 0.7%. Saudi Arabia was the worst performer, as the MSCI Saudi Arabia Index plummeted 11.6% due to low investor confidence and higher inflation. Oman was the second-best performer after Bahrain the MSCI Oman Index slipped 3.8% as investors adopted a wait-and-watch strategy. On an asset weighted average, GCC equity funds lost 5.2% in March 2008 (Figure - 4). Figure 4: Performance Trend of GCC s 3% GCC Equity s Asset Size Weighted Returns 10% 10% 9% 7% 4% 1% 1% 2% -1% -3% -5% Mar-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Trends in allocation to the Saudi market reversed in March While the allocation has been declining since December 2007 (from 35% in December 2007 to 25% in February 2008), it increased by 1 percentage point to 26% (Figure - 5). Allocation to Kuwait decreased substantially from 23% in February to 15% in March. This has been adjusted with the higher allocation to Other MENA markets that increased from 4% in February to 10% in March. While allocation to Oman and Qatar Kuwait Financial Centre Markaz 3

4 While allocation to Saudi Arabia increased to 26%, allocation to other MENA regions increased to 10% decreased by 2 percentage points and 1 percentage point respectively, asset allocation to the UAE increased by 3 percentage points. Allocation to Bahrain remained unchanged at 4%. Figure 5: Allocation Trends by Geography GCC Equity s (until March 2008) 100% 90% 80% Oman Bahrain Qatar Other MENA 70% 60% UAE 50% 40% Kuwait 30% 20% 10% Saudi Arabia 0% Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Managers decreased their exposure to equities in March; the level of cash held increased by 1 percentage point With an aim to minimize susceptibility to increased volatility and poor performance of the GCC markets, mutual funds marginally reduced their exposure to equities in March (Figure 6). Free cash held by funds increased from 5% in February to 6% in March. However, the exposure to bonds remained unchanged at 1%. Figure 6: Asset Allocation Trends GCC Equity s (until March 2008) 100% 90% Bonds Cash 80% 70% 60% 50% 40% 30% 20% 10% Equities 0% Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Kuwait Financial Centre Markaz 4

5 Conventional GCC s SICO s Gulf Equity topped the charts for March, posting a loss of 1.8% Among Conventional funds, Gulf Equity (SICO) posted a loss of 1.8% and it was still the best performing fund for the month. The fund had returned a strong 6.8% in February 2008 that enabled it to post YTD returns of 8.2% in March. Gulf Equity (SICO) capitalized on the slump in share prices in UAE and strengthened its exposure in that country from 31% in February to 35% in March. Gulf Balanced /Aafaq Investment funds (National Bank of Dubai) followed in the best performer s list, registering a MoM loss of 2.7% after decreasing its exposure to volatile equities by 4 percentage points. Mirroring the market trend, Al-Ahli Gulf (Al Ahli Bank of Kuwait) lost 3.8% for the month. However, on a YTD basis, the fund returned 4.7% (Table - 4). Table 4: Top Five Conventional s (March 2008) Mar-08 Performance (%) Name Manager Inception AUM ($ Mn) Mar-08 YTD 2007 SICO Gulf Equity SICO Mar % 8.17% 37.30% Aafaq Investment s National Bank of Dubai Oct % 0.48% 41.57% Khaleej Equity SICO Mar % 6.05% 44.13% AlAhli Gulf AlAhli Bank of Kuwait Nov % 4.74% 29.57% Gulf Premier Gulf Investment Corporation Apr % 1.35% 43.24% Aafaq Investments s recorded highest annualized returns of 16.6% over past 3 years Over the three year horizon, Aafaq Investments s (National Bank of Dubai) recorded highest annualized returns of 16.6% among the GCC funds with comparatively lower risk of 13.1% due to lesser exposure to volatile markets (Figure 7). Figure 7: Risk Return profile of Conventional mutual funds % Return April March Conventional s Performance (April March 2008) NBD Aafaq Invesment s SICO Khaleej Equity BankMuscat Oryx Global GCC Large Cap Shuaa Arab Gateway TAIB GCC Bluechip GIC Gulf Premier SIB GCC Equity % Risk April March 2008 Kuwait Financial Centre Markaz 5

6 Islamic GCC s Riyad Gulf recorded a MoM loss of 4.33% in March, but returned 2.8% YTD In March 2008, Riyad Gulf (Riyad Capital) posted a MTD loss of 4.3%. Benefits derived from the fund s decreased exposure in the slack UAE markets (by 6 percentage points) were partially offset by the 1 percentage point higher allocations in the Qatar market. Meanwhile, it also increased exposure to Bahrain (by 3 percentage points) and Oman (by 1 percentage point) (Table - 5). Al Rajhi GCC Equity (Al Rajhi Bank) posted a loss of 5.0% after returning a strong 8.1% in February. Amanah GCC Equity (Saudi British Bank), the top performer in February, slipped to third position with a loss of 5.7% for March. Arab Islamic Gateway (SHUAA Capital) and Al Basha er GCC Equity (KFIC), which have significant exposure to Saudi, lost 5.9% each for the month. Table 5: Top Five Sharia-compliant s (March 2008) Mar-08 Performance (%) Name Manager Inception AUM ($ Mn) Mar-08 YTD 2007 Riyad Gulf Riyad Capital Feb % 2.80% 44.88% AlRajhi GCC Equity Al-Rajhi Bank Oct % -2.70% 64.37% Amanah GCC Equity Saudi British Bank Apr % -4.65% 29.24% Arab Islamic Gateway SHUAA Capital Sep % -3.39% 47.65% AlBasha'er GCC Equity KFIC Jan % -2.83% 53.07% Note: Returns and Risk rounded off AlRajhi GCC Equity topped the charts with highest annualized returns of 49.2% Over the last one year, AlRajhi GCC Equity (Al Rajhi Bank) registered the highest annualized returns 49.2% with comparatively lower risk of 19.3% (Figure 8). Figure 8: Risk Return profile of Islamic mutual funds 60 Islamic s Performance (April March 2008) % Return April March AlRajhi GCC Equity Riyad Bank Gulf AlBasha'er GCC Equity Gulf Industrial Companies Al-Tawfeek Gulf Equity Arab Islamic Gateway BSF AlDana GCC Equity AlAhli GCC Trading Equity SABB Amanah GCC Equity % Risk April March 2008 Kuwait Financial Centre Markaz 6

7 Saudi Arabia Equity s performance was weak across board Key Highlights Inflationary concerns and weak market sentiment caused the Saudi exchange to plummet The Saudi stock market ended at 9,315 points in March, down 11.2% over the previous month, on the back of concerns over rising inflation and the worsening crisis in the U.S. financial markets. MSCI GCC Index fell by 9.9% due to Saudi Arabia, which has the highest weight in the index. Saudi funds on average lost 6.8% in March 2008 due to weak market performance. Saudi equity funds had 89.8% exposure to equities and cash held accounted for 10.2% of total assets. Al Musahem (Samba Financial Group) was the best performer among Conventional funds as it posted a loss of 4.8% for the month compared to loss of 11.6% for the benchmark. Among Sharia-compliant funds, AlAhli Saudi Dynamic Trading Equity (NCB Capital) registered a month-on-month (MoM) loss of 1.9% in March Figure 9: Top Five Conventional s by Monthly Returns All Saudi Equity s posted losses in March -4.8% -4.9% -5.4% -5.7% -5.9% -11.6% MSCI Saudi Arabia Al Musahem Saudi Gateway ANB Saudi Companies SAIB Saudi Equity ANB Saudi Equity Figure 10: Top Five Islamic s by Monthly Returns -1.9% -3.4% -4.8% -5.1% -5.3% -8.1% MSCI Saudi Arabia Islamic Index AlAhli Saudi Dynamic Trading Equity Amanah Growth Portfolio SAIB Saudi Companies SAMBA Al Raed SHB: Saudi Equity Trading Kuwait Financial Centre Markaz 7

8 All Saudi equity funds registered losses in March The benchmark MSCI Saudi Index and MSCI Saudi Islamic Index reported MoM losses of 11.6% and 8.1%, respectively. Table 6: Top Five s (in terms of AUM in March 2008) AUM ($Mn) Focus Market Share HSBC Saudi Arabia 3,176 Saudi Arabia 43.4% Riyad Capital 2,387 Saudi Arabia 32.6% NCB Capital 783 Saudi Arabia 10.7% Bank Al Bilad 309 Saudi Arabia 4.2% SHUAA Capital 190 Saudi Arabia 2.6% Conventional Saudi s Al Musahem topped the charts in March, posting a loss of 4.9% Al Musahem (Samba Financial Group) registered a loss of 4.8% in March (Table 7). However, it was the best performing fund among Conventional Saudi funds. The fund fact sheet is unavailable for a more detailed analysis. The Saudi Gateway (SHUAA Capital) posted a monthly loss of 4.9%. Saudi Basic Industries Co. (SABIC), Saudi Fertilizers, and Saudi Cables, the top three holdings of Saudi Gateway, account for 14.1%, 9.1% and 7.8%, respectively, of its total assets. While SABIC was down 10.3% in March, Saudi Fertilizers was up 12.3%. Table 7: Top Five Conventional s (March 2008) Mar-08 Performance (%) Name Al Musahem Saudi Gateway ANB Saudi Companies SAIB Saudi Equity Manager Inception AUM ($ Mn) Mar-08 YTD 2007 Samba Financial Group May % % 47.92% SHUAA Capital Jul % -9.35% 35.76% Arab National Bank May % -8.93% 30.32% SAIB Asset Management Company Jul % -9.28% 46.54% Arab National Bank Apr % % -6.17% ANB Saudi Equity Note: Returns and Risk rounded off Among all Saudi Arabian Conventional funds, SABB Saudi Equity (HSBC Saudi Arabia) is ahead of its peers with highest annualized returns of 4.5% with comparatively lower risk of 38.5% (Figure 11). This was mainly due to the strong returns of 46.6% and a low risk of 29.2% in the last one year. Kuwait Financial Centre Markaz 8

9 Figure 11: Risk Return profile of Conventional mutual funds Over the last three years, SABB Saudi Equity registered the highest annualized returns of 4.5% % Return April March SAIB Saudi Eq. ANB Saudi Co. ANB Saudi Equity Conventional s Performance (April March 2008) SABB Saudi Equity Riyad Eq. 3 Al Musahem SABB Saudi Eq. Tr. Riyad Eq. 1 Financial Institutions Al Fareed Saudi Istithmar % Risk April March 2008 Islamic Saudi s In March 2008, AlAhli Saudi Dynamic Trading Equity (NCB Capital) posted a month-to-date loss of 1.9% and was the top performer among Islamic funds (Table 8). The fund considerably reduced its exposure to equities as it held 88.6% of its assets in cash. AlAhli Saudi Dynamic Trading Equity s top three holdings are SABIC (4.6%), Al Rajhi Bank (1.6%), and Saudi Telecom Co (1.6%). Amanah Growth Portfolio (HSBC Saudi Arabia) lost 3.4% during the month compared to the 7.3% gain in February. Good performance in February helped the fund curb its YTD loss to 6.5%. AlAhli Saudi Dynamic Trading Equity was the top performer, losing 1.9% MoM in March Table 8: Top Five Sharia-compliant s (March 2008) Mar-08 Performance (%) Name Inception AUM ($ Mn) Mar-08 YTD 2007 AlAhli Saudi Dynamic Trading Equity NCB Capital Apr % -8.32% 11.33% Amanah Growth HSBC Saudi Arabia Portfolio Jan % -6.51% 33.76% SAIB Saudi Companies SAMBA Saudi Equity (Al Raed ) SHB: Saudi Equity Trading Note: Returns and Risk rounded off SAIB Asset Management Company Apr % % 50.72% Samba Financial Group Dec-02 1, % % 50.59% Saudi Holandi Capital Company Jul % -4.55% 50.24% Amanah Growth Portfolio (HSBC Saudi Arabia) outperformed all Islamic funds over the last three years. The yielded maximum annualized returns of 9.1% with the lowest risk of 18.2% (Figure 12). Riyad Equity 2 had a three year annualized return of -5.2% as it recorded a loss of 58.5% in Kuwait Financial Centre Markaz 9

10 Figure 12: Risk Return profile of Islamic mutual funds Amanah Growth Portfolio fund yielded maximum returns of 9.1% with a risk profile of 18.2% % Return April March Islamic s Performance (April March 2008) Amanah Growth Portfolio Al Taiyebat Saudi Equity Al Safwa Investment AlAhli Saudi Trading Equity SHB: Saudi Equity Trading Al Rajhi Local Shares SAMBA Saudi Equity (Al Raed ) Riyad Equity % Risk April March 2008 On a weighted average basis (excluding AlAhli Saudi Dynamic Trading Equity that has a huge cash position of 88.6%), in March 2008, equities accounted for 89.8% of the total assets held by Saudi equity funds, while cash and cash equivalents accounted for the remaining 10.2% (Figure - 13). Figure 13: Asset Allocation Trends Saudi Equity s (March 2008) Bonds, 0% Cash, 10.2% Equities, 89.8% Note: Returns and Risk rounded off Kuwait Financial Centre Markaz 10

11 Key Highlights Kuwait Equity s Volatility impacted March returns In March, Kuwait Equity s posted losses for the first time in 2008 March proved to be the worst month so far in 2008, with all Kuwait-focused funds yielding negative returns for the first time this year, led by a volatile economic and political scenario Investor sentiment was affected by the unexpected resignation of the ruling government and by regulatory changes in the banking system On average, funds lost 3.3% in March 2008, but outperformed the broader market, MSCI Kuwait Index, which was down 9.1% Al Rou yah (Kuwait and Middle East Financial Investment Company) topped the Conventional funds performance list with a month-on-month loss of 2.3% In March 2008, Al Wasm (Kuwait Finance and Investment Company) was the best performing Sharia fund with a gain of 4.7%. The fund significantly outperformed the benchmark MSCI Kuwait Islamic Index, which declined 11.6%. Figure 14: Top Five Conventional s by Monthly Returns -2.3% -3.3% -3.7% -3.9% -4.0% -9.1% MSCI Kuwait Index Al Rou'yah Burgan Equity KAMCO Investment Global Local Al Ahli Kuwaiti Al Wasm was the only Kuwait Equity to post positive returns Figure 15: Top Five Islamic s by Monthly Returns 4.7% -1.0% -1.0% -2.1% -3.7% -11.6% MSCI Kuwait Islamic Index Al Wasm Al-Durra Al-Seef Islamic Al Dar Securities Al Safwa Investment Kuwait Financial Centre Markaz 11

12 During the month, Kuwait s Sharia and Conventional funds reported losses as the ongoing political turmoil and uncertainty in the financial market weighed heavily on investor sentiment. Table 9: Top Five s (in terms of AUM in March 2008) Kuwait Financial Center (Markaz) leads the market share with 26% AUM ($Mn) Focus Market Share Kuwait Financial Centre 1,643 Kuwait 25.7% National Investments Company 1,357 Kuwait 21.3% Kuwait Investment Company 870 Kuwait 13.6% Commercial Bank of Kuwait 471 Kuwait 7.4% Burgan Bank 402 Kuwait 6.3% Conventional Kuwait s Among the top five Conventional funds, Al Rou yah (Kuwait and Middle East Financial Investment Company) was the best performer with a month-on-month loss of 2.3% followed by Burgan Equity (Burgan Bank) with -3.3% returns, KAMCO Investment -3.7% (Kipco Asset Management Co.) and Global Investment House's Local -3.9% (Table - 10). In terms of YTD, Burgan Equity (Burgan Bank) led the pack with returns of 11.4%. The fund had invested 37.5% of its assets under management in the banking sector followed by investments and services, while limiting its exposure to the industrial sector to 9.4%. KAMCO Investment (Kipco Asset Management Co.) had invested 27.2% in the industrial sector. The prevailing negative sentiment dragged down Kuwait s Industrial index by 0.4% MoM. In addition, banking stocks took a beating following the Central Bank of Kuwait s decision to introduce changes in consumer lending regulations. Table 10: Top Five Conventional s (March 2008) Mar-08 Performance (%) Name Inception AUM ($ Mn) Mar-08 YTD 2007 Kuwait and Middle Al Rou'yah East Financial Investment Co. Jun-02 NA -2.27% 8.46% 33.11% Burgan Equity Burgan Bank Dec % 11.35% 27.27% KAMCO Investment Global Local Al Ahli Kuwaiti Note: Returns and Risk rounded off Kipco Asset Management Company Apr % 9.23% 44.23% Global Investment House Jan % 8.37% 12.65% Al Ahli Bank of Kuwait Feb % 9.76% 38.73% On a three year annualized horizon, Al Wataniya Investment (National Investments Company) outperformed other Conventional equity funds. The yielded maximum annualized returns of 20.5% with a comparatively lower risk of 20.5% during the same period (Figure - 16). Due to lack of relevant data we are unable to analyze any further. Kuwait Financial Centre Markaz 12

13 Figure 16: Risk Return profile of Conventional mutual funds % Return April March Al Rou'yah Conventional s Performance (April March 2008) Coast Investment Al-Raed KAMCO Investment Markaz Investment and Development Burgan Equity Markaz Forsa Al Wataniya Investment Markaz Mumtaz Investment Tijari Investment Al Ahli Kuwaiti Al-Shorooq Investment 4 Global Local Islamic Kuwait s % Risk April March 2008 In March 2008, Al Wasm (Kuwait Finance and Investment Company) was the only Islamic fund to post a positive return. The fund reported a monthly gain of 4.7%, and registered YTD returns of 17.6%. Al-Durra Islamic (Global Investment House) was second with a loss of 0.95% followed by Al Seef (Bank Al Bilad) with a loss of 1.0% (Table - 11). The average loss of the top five Islamic funds was around 0.6%, significantly narrower than the 11.6% loss of the benchmark index. In line with Conventional peers, the top 5 Islamic funds also had major investments in the banking and investments sector. As for the Services sector, the Services index yielded MoM returns of 5.5%. Al- Durra Islamic (Global Investment House) had invested 5.0% in this sector while Al Dar Securities (Al Dar Asset Management) had no exposure. The overall loss in March 2008 was largely the result of regulatory changes in the banking system. Table 11: Top Five Sharia compliant s (March 2008) Mar-08 Performance (%) Al Wasm posted MoM returns of 4.7% and YTD returns of 17.6% in March 2008 Name Manager Inception AUM ($ Mn) Mar-08 YTD 2007 Al Wasm KFIC Jun % 17.63% 1.94% Al-Durra Islamic Global Investment House May-04 NA -0.95% 17.71% 32.75% Al Seef Bank Al Bilad Jan % 17.61% 32.26% Al Dar Securities Al Dar Asset Management Oct % 14.66% 20.11% Al Safwa Investment National Investments Company May % 11.72% 26.45% Note: Returns and Risk rounded off Kuwait Financial Centre Markaz 13

14 On an average, all six Sharia funds returned 15.7% with an average risk of 18.5%. Over the last 3 years, Al-Durra Islamic (Global Investment House) resulted in the maximum annualized returns of 25.9% with an annualized risk of 19.2% (Figure - 17). Figure 17: Risk Return profile of Islamic mutual funds % Return April March Al Safwa Investment Islamic s Performance (April March 2008) Al Darij Invest ment Al Dar Securities Al-Durra Islamic Markaz Islamic Al Huda Islamic % Risk April March 2008 managers were more conservative in March 2008 s reduced their exposure to equities in March 2008 as a cushion against volatility in the market. The exposure to equities was 91% as compared to 96% in February (Figure - 18). As such, funds (on a weighted-average basis) held more cash in March 2008 relative to the previous month. Figure 18: Asset Allocation Trends Kuwait Equity s (March 2008) 100% 96% 91% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0% 0% 4% 9% Bonds Cash Equities Feb-08 Mar-08 Kuwait Financial Centre Markaz 14

15 Key Highlights Qatar Equity s March - the worst month in 2008 The Qatar market performed poorly in March, dragged down by the Industrial sector which plummeted 14.7% MoM The MSCI Qatar Index and MSCI Qatar Islamic Index were down 10.3% and 12.2%, respectively, mainly due to the poor performance of large companies such as Masraf Al Rayan and Qatar Islamic Insurance The Industrial sector was the worst performer in Qatar, with its index plummeting 14.7% month-on-month Adopting a conservative approach, fund managers reduced exposure to equities in March 2008, and preferred to hold higher cash In Conventional funds, Makaseb Qatar Equity topped the charts, despite a loss of 6.3% in March 2008 Al-Beit Al-Mali Sharia Compliant, the only Qatari Shariacompliant fund, posted a loss of 10.7% during the month Figure 19: Top Five Conventional s by Monthly Returns -6.3% -6.9% -7.0% -7.3% -7.5% -10.3% Qatar Equity s experienced losses in March MSCI Qatar Index Makaseb Qatar Equity Qatar Gate (N) NBK Qatar Equity Qatar Gate (Q) AL Watani 2 Figure 20: Islamic by Monthly Returns -10.6% -12.2% MSCI Qatar Islamic Index Al-Beit Al-Mali Shariah Compliant Kuwait Financial Centre Markaz 15

16 Understandably, weakness in the Qatar market had a negative effect on all funds in the country resulting in both Sharia-compliant and Conventional funds posting losses in March Conventional Qatar s Makaseb Qatar Equity topped the charts in March 2008, as it posted the lowest loss of 6.2% Among Conventional s, Makaseb Qatar Equity (Mashreq Bank) was the best performer in March 2008, despite recording a nearly 6.3% decline in NAV (Table - 12). The negative impact of greater exposure in Qatar s Industrial sector was partially offset by high holdings in Qatar National Bank, which performed well during the month. The fund factsheet states that, as most companies in the market had reached their maximum foreign holding levels, Makaseb, a UAE-based fund, was unable to buy stock at the prevalent attractive levels. The fund yielded YTD returns of 2.2%, a tad lower than the second-best performer, Qatar Gate (N) (Amwal), which posted YTD returns of 2.6% and a monthly loss of 6.9%. Qatar Gate s (N) investment in the relatively better performing Banking sector marginally offset losses in the Industrial sector. Table 12: Top Five Conventional s (March 2008) Mar-08 Performance (%) Name Manager Inception AUM ($ Mn) Mar-08 YTD 2007 Makaseb Qatar Equity Mashreq Bank May % 2.24% 50.45% Qatar Gate (N) Amwal Sep-05 NA -6.88% 2.61% 36.09% NBK Qatar Equity National Bank of Kuwait May-06 NA -7.04% 0.00% 51.72% Qatar Gate (Q) Amwal Sep-05 NA -7.25% 2.61% 38.81% Al Watani 2 Qatar National Bank Oct-05 NA -7.47% -3.93% 32.51% Note: Returns and Risk rounded off Islamic Qatar s The only Sharia-compliant fund in Qatar reported a loss of 10.7% in March 2008 Al-Beit Al-Mali Sharia Compliant (Qatar National Bank), the only Sharia-compliant fund in Qatar, reported a loss of nearly 10.7% in March 2008 (Table - 13). The fund s weak performance can be attributed to its higher exposure to the Industrial sector. Nevertheless, the factsheet stated that the fund is re-structuring its operations and expects to generate better returns, going forward. Table 13: Sharia-compliant (March 2008) Mar-08 Performance (%) Name Inception Al-Beit Al-Mali Shariah Compliant Qatar National Bank Sep-06 NA Note: Returns and Risk rounded off AUM ($ Mn) Mar-08 YTD % -2.95% 21.41% Kuwait Financial Centre Markaz 16

17 UAE Equity s Weak markets dent returns Key Highlights managers exercised caution by increasing cash held Most UAE funds performed poorly in March due to weak global markets and the caution being exercised by investors. managers reduced their exposure to equities by being conservative and sitting on cash. Among Conventional funds, TNI Dana Women (The National Investor) topped the list, losing 4.7% for the month. The Sharia-compliant Dubai Growth (3i Capital Group) was the only fund to report positive returns in March 2008 it returned 0.9%. Figure 21: Top Five Conventional s by Monthly Returns -4.7% -6.0% -6.1% -7.3% -8.3% MSCI UAE Index TNI Dana Women Daman Second Emirates TNI UAE Blue Chip Emirates Gateway -8.4% Makaseb Emirates Opportunities Figure 22: Islamic s by Monthly Returns 0.9% Dubai Growth was the only UAE Equity to generate positive returns in March -8.3% -4.8% -6.8% MSCI UAE Islamic Dubai Growth Index Ltd Daman Islamic NBAD UAE Islamic Kuwait Financial Centre Markaz 17

18 The poor performance was reflected in the losses posted by Conventional funds and all but one Sharia fund in March. Both the MSCI UAE and MSCI UAE Islamic Indices lost approximately 8.3% during the month due to the prevailing weakness in global markets. Table 14: Top Five s (in terms of AUM in March 2008) AUM ($ Mn) Focus Market Share National Bank of Abu Dhabi 1,287 UAE 70.2% Abu Dhabi Commercial Bank 296 UAE 16.1% SHUAA Capital 96 UAE 5.2% Al Mal Capital 63 UAE 3.4% The National Investors 53 UAE 2.9% Conventional UAE s Among Conventional funds, TNI Dana Women (The National Investor) was the best performing fund for the month with a loss of 4.7% (Table - 15). The fund returned 3.1% in February, but lost 4.7% YTD (March 2008). Daman Second Emirates (Daman Investments), which lost 6.0% MoM, was the second best performer. The fund s fact sheet stated that it kept away from volatile markets through restricted buying and opportunistic selling. Consequently, it ended the month with relatively higher levels of cash compared to February. TNI UAE Blue Chip (The National Investor), which registered a monthly loss of 6.1%, was the best performing Conventional fund in terms of YTD returns (- 2.9%). Emirates Gateway (SHUAA Capital) occupied fourth position in terms of monthly returns and is the worst performer on a YTD basis. Higher exposure to heavyweight stocks such as Emaar (15% of total holdings) dented returns for this fund in March TNI Dana Women was the best among its peers with a loss of 4.7% Al Nokhita led with annualized returns of 1.2% over the last 3 years Table 15: Top Five Conventional s (March 2008) Mar-08 Performance (%) Name Inception TNI Dana Women Daman Second Emirates TNI UAE Blue Chip AUM ($ Mn) Mar-08 YTD 2007 The National Investors Jul % -4.66% 21.23% Daman Investments Feb-07 NA -6.04% -4.37% 23.27% The National Investors Apr % -2.95% 54.85% Emirates Gateway SHUAA Capital Mar % -6.24% 54.14% Makaseb Emirates Opportunities Mashreq Bank May % -3.21% 57.15% Note: Returns and Risk rounded off Al Nokhita (Abu Dhabi Commercial Bank) topped the chart with a maximum 3 year annualized return of 1.2% and a corresponding risk of 37.0% (Figure - 23). Kuwait Financial Centre Markaz 18

19 Figure 23: Risk Return profile of Conventional mutual funds % Return April March Conventional s Performance (April March 2008) Emirates Gateway Al Nokhitha NBAD UAE Trading Makaseb Emirates Equity NBAD UAE Growth Islamic UAE s % Risk April March 2008 Dubai Growth (3i Capital Group) was the only fund to post positive returns in March it returned 0.9%. The fund returned 1.9% YTD (Table - 16). The fund factsheet is unavailable for a detailed analysis. Daman Islamic (Daman Investments) reported a MoM loss of 4.76% in March. However, the positive 3.3% returns for February enabled the fund to restrict YTD losses to 3.8% in March. The fund exercised caution by sitting on cash, which constituted roughly 50% of its assets thus enabling it to retain value in a weak market. UAE Islamic (National Bank of Abu Dhabi), however, bore the brunt of the fragile conditions it lost 6.8% MoM and 7.8% YTD in March Losses stemmed mainly from the fund s large exposure to heavyweight stocks, such as Etisalat and Emaar Properties, which were down 5% and 12%, respectively, in March Dubai Growth posted a positive MoM return of 0.9% and YTD return of 1.9% in March Table 16: Sharia compliant s (March 2008) Mar-08 Performance (%) Name Inception AUM ($ Mn) Mar-08 YTD 2007 Dubai Growth Ltd 3i Capital Group Mar-07 NA 0.94% 1.90% 5.00% Daman Islamic Daman Investments May-07 NA -4.76% -3.78% 13.24% NBAD UAE Islamic National Bank of Abu Dhabi Jan % -7.78% 40.43% Note: Returns and Risk rounded off Kuwait Financial Centre Markaz 19

20 Oman Equity s Negative sentiment hurts returns Figure 24: Oman Equity s by Monthly Returns 0.0% -0.2% -0.6% -3.8% MSCI Oman Index Vision Emerging Oman Oman Gateway Muscat None of the three Omani funds (all Conventional) reported positive returns in March 2008 due to cautious trading by investors. Vision Emerging Oman was the best performer; it did not report any losses in March 2008 Vision Emerging Oman s (Vision Investment Services Company) returns were flat during March 2008; however, the fund has returned a healthy 14.3% YTD. Oman Gateway (SHUAA Capital) took second position with a monthly loss of 0.2%. Muscat (BankMuscat) followed with a 0.6% loss (Table - 17). Vision Emerging Oman allocated roughly 50% of its total corpus to the banking sector and 31% to the services sector. The fund performed better in March 2008 due to sharp appreciation in the share price of its top holding, National Bank of Oman SAOG, following a stock split and declaration of dividends. During the month, Vision Emerging Oman increased exposure to Al Anwar Ceramic and Omantel. Oman Gateway allocated 30% of its total assets to the banking sector and 32% to the manufacturing sector. Muscat lost 0.6% MoM and 8.3% YTD. Positive returns from the banking sector were offset by losses in the services sector. Table 17: Omani Conventional s (March 2008) Mar-08 Performance (%) AUM ($ Mn) Mar-08 YTD 2007 Vision Investment Services Company Aug % 14.32% 32.27% Name Inception Vision Emerging Oman Oman Gateway SHUAA Capital Jul % 14.88% 51.77% Muscat BankMuscat Dec % -8.31% 64.43% Note: Returns and Risk rounded off Kuwait Financial Centre Markaz 20

21 Over a three year horizon, Muscat (BankMuscat) proved to be the maximum returns provider (in terms of annualized returns) with 31.2% having an annualized risk of 19.4% while Oman Gateway (SHUAA Capital) returned 26.6% with a risk of 18.7% (Figure - 25). Figure 25: Risk Return profile of Omani Mutual s Muscat was the highest returns provider over a three year period % Return April March Conventional s Performance (April March 2008) Oman Gateway % Risk April March 2008 Muscat Kuwait Financial Centre Markaz 21

22 Bahrain Equity s Weak cues diminish returns Figure 26: Bahrain Equity s by Monthly Returns 0.7% 0.5% -4.3% MSCI Bahrain Index Delmon SICO Selected Securities The impact of the slowdown in global and GCC markets was reflected in the benchmark, MSCI Bahrain Index. The index gained a mere 0.7% on a MoM basis. This slowdown also impacted the performance of Selected Securities (SICO), which registered a loss of 4.3% in March Delmon posted positive returns despite unfavorable market dynamics Delmon (Global Investment House) outperformed the Bahrain Stock Exchange by returning 0.5% in March 2008 (Table - 18). The fund had returned 4.1% in February and a remarkable 8.5% YTD. Due to lack of adequate data we are unable to analyze the fund s performance in detail. However, the poor performance of the Bahrain Stock Exchange had a bearing on Selected Securities (SICO), which had large equity investments. Table 18: Bahrain equity s (March 2008) Mar-08 Performance (%) Name Inception AUM ($ Mn) Mar-08 YTD 2007 Delmon Global Investment House Oct % 8.52% 23.00% SICO Selected Securities Securities & Investment Company May % 7.05% 29.27% Note: Returns and Risk rounded off Kuwait Financial Centre Markaz 22

23 Of the two Conventional funds, though Delmon (Global Investment House) was the riskier of the two, it also provided higher returns over an annualized three year horizon (Figure 27). Delmon registered a three year annualized return of 10.8% as against the return of 9.2% of SICO Selected Securities (SICO). Figure 27: Risk Return profile of Bahrain Equity s. Delmon yielded highest returns over three year period % Return April March Conventional s Performance (April March 2008) SICO Selected Securities Delmon % Risk April March 2008 Kuwait Financial Centre Markaz 23

24 Appendix 1: GCC Equity s Statistics Sharia compliant s Asset Allocation Geographic Allocation ^^ Performance (%) Name Inception Size ($Mn) Cash Equities Bonds Total Saudi Arabia Kuwait UAE Other Qatar Oman Bahrain Mena Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 AlAhli GCC Trading Equity The National Commercial 1 Bank Oct % 93% 0% 100% 49% 22% 16% 9% 2% 4% 0% 100% -8.93% -7.89% 58.86% % 2 AlBasha'er GCC Equity KFICO Jan % 93% 0% 100% 21% 24% 27% 24% 0% 3% 0% 100% -5.99% -2.83% 53.07% % 3 AlRajhi GCC Equity Al-Rajhi Bank Oct % 100% 0% 100% 33% 45% 7% 10% 5% 0% NA 100% -5.04% -2.70% 64.37% % 4 Riyad Gulf Riyad Bank Feb % 97% 0% 100% 0% 29% 37% 20% 4% 10% 0% 100% -4.33% 2.80% 44.88% % 5 Amanah GCC Equity Saudi British Bank Apr % 99% 0% 100% 32% 20% 31% 9% 6% 2% NA 100% -5.69% -4.65% 29.24% % 6 Arab Islamic Gateway SHUAA Capital Sep % 92% 0% 100% 35% 0% 38% 10% 5% 3% 9% 100% -5.97% -3.39% 47.65% % 7 Jadwa GCC Equity Jadwa Investment Jun % 0% 0% 0% NA NA NA NA NA NA NA NA -8.29% % 35.90% % 8 Jadwa Arab Jadwa Investment Jun % 0% 0% 0% NA NA NA NA NA NA NA NA -7.79% % 36.24% % 9 AlDana GCC Equity Banque Saudi Fransi Apr N.A N.A N.A N.A NA NA NA NA NA NA NA NA -8.12% -5.01% 60.99% % 10 Al-Tawfeek Gulf Equity Al Tawfeek Company for Investment s Aug % 99% 0% 100% 30% 8% 34% 10% 10% 0% 6% 97% -7.05% -3.12% 48.41% % Gulf Industrial Companies 11 Saudi Investment Bank Apr % 90% 0% 100% 82% 7% 3% 7% 1% 0% 0% 100% -6.00% -5.14% 63.14% % Total 924 1% 10% 0% 10% 2% 2% 3% 2% 0% 0% 0% 10% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Conventional s Asset Allocation Geographic Allocation ^^ Performance (%) Name Inception Size ($Mn) Cash Equities Bonds Total Saudi Arabia Kuwait UAE Other Qatar Oman Bahrain Mena Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 1 Arab Gateway Shuaa Capital Dec % 94% 0% 100% 35% 2% 35% 9% 6% 2% 11% 100% -5.31% -2.54% 49.28% % 2 Alpha Mena Algebra Capital Oct % 97% 0% 100% 29% NA 33% 12% 3% 4% 18% 100% -4.97% -5.25% 14.56% % Gulf Investment 3 Gulf Premier Corporation Apr % 91% 0% 100% 29% 33% 17% 13% 7% 2% 0% 100% -3.94% 1.35% 43.24% % 4 AlAhli Gulf AlAhli Bank of Kuwait Nov % 90% 0% 100% 10% 61% 12% 5% 1% 11% 0% 100% -3.83% 4.74% 29.57% % 5 NBD Mena National Bank of Dubai Nov % 96% 0% 100% 8% 7% 33% 5% 2% 8% 35% 100% -5.39% -4.02% 41.65% % 6 GCC Equity Saudi Investment Bank Jul % 75% 0% 100% 57% 15% 12% 9% 2% 4% 1% 100% -4.59% -7.91% 43.33% % 7 Khaleej Equity SICO Mar % 95% 0% 100% 19% 26% 27% 16% 2% 9% 0% 100% -3.40% 6.05% 44.13% % 8 NBAD GCC Opportunities National Bank of Abu Dhabi Feb % 0% 0% 0% NA NA NA NA NA NA NA NA -7.90% -7.90% 0.00% NA 9 Global GCC Large Cap Global Investment House Feb % 95% 0% 100% 36% 28% 24% 11% 0% 1% 0% 100% -7.49% -7.93% 48.92% % 10 Aafaq Invesment s National Bank of Dubai Oct % 59% 30% 100% 8% 10% 53% 10% 3% 15% 0% 100% -2.67% 0.48% 41.57% % 11 SICO Gulf Equity SICO Mar % 95% 0% 100% 0% 32% 35% 21% 3% 9% 0% 100% -1.80% 8.17% 37.30% % 12 Vision Emerging GCC Vision Investment Services Co May % 95% 0% 100% 15% 18% 15% 17% 26% 7% 3% 100% -4.70% 1.17% 56.49% % 13 Oryx BankMuscat Jul % 0% 0% 0% NA NA NA NA NA NA NA NA -5.66% 0.50% 40.14% % 14 Arab Bank Mena Al Arabi Investment Group Sep % 87% 2% 100% 36% 17% 15% 8% 3% 1% 22% 102% -4.44% -2.34% 28.88% % 15 Meridio ArabWorld Meridio AG Mar % 93% 0% 100% 7% 28% 31% 11% 3% 0% 21% 100% -8.23% -4.34% 20.80% % 16 Markaz GCC Kuwait Financial Center Jan % 77% 0% 100% 23% 30% 19% 14% 9% 4% 0% 100% -5.00% -1.47% 48.40% % 17 Tijari GCC Equity Commercial Bank of Kuwait Jan % 98% 0% 100% 31% 40% 6% 23% 0% 0% 0% 100% % % 21.97% % 18 Arabian Opportunities Audi Saudi Arabia Sep % 95% 0% 100% 5% 95% 0% 4% NA NA 12% NA -4.82% -4.51% 24.77% % 19 Makaseb arab Tigers Makaseb Nov % 91% 0% 100% 30% 5% 16% 0% 17% 1% 32% 102% -5.00% -3.86% 40.10% % 20 TAIB GCC Bluechip TAIB Securities Jun % 74% 0% 100% 42% 15% 13% 13% 5% 12% 0% 100% -6.00% -4.90% 43.99% % Kuwait and Middle East 21 Gulf Gate * Financial Investment Co. Aug-06 NA 19% 81% 0% 100% 21% 56% 13% 8% 2% 0% 0% 100% -6.15% -1.52% 24.00% % 22 NBK Gulf Equity * National Bank of Kuwait Jun-05 NA 3% 97% 0% 100% 40% 21% 17% 9% 5% 3% 4% 100% -6.51% -5.09% 42.26% % Arabian Programmed Trading 23 * Daman Securities Feb-05 NA 42% 58% 0% 100% 27% 21% 44% 8% 0% 0% 0% 100% -4.90% -2.49% 30.77% % Total 2,266 6% 81% 1% 88% 23% 13% 25% 10% 4% 4% 9% 88% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Source: Markaz Analysis, Zawya, Lipperweb, Stock Exchange websites Kuwait Financial Centre Markaz 24

25 Appendix 2: Saudi Equity s Statistics Sharia compliant s Asset Allocation Performance (%) Name Country Focus Inception Size ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (% ) 2 LTM Risk 3 1 Amanah Saudi Equity HSBC Saudi Arabia Saudi Arabia May-04 1,830 1% 99% 0% 100% -7.27% % 51.40% % 2 SAMBA Saudi Equity (Al Raed ) Samba Financial Group Saudi Arabia Dec-02 1,194 NA NA NA 0% -5.09% % 50.59% % 3 Riyad Equity 2 Riyad Capital Saudi Arabia Nov NA NA NA 0% -5.60% % 57.46% % 4 AlAhli Saudi Trading Equity NCB Capital Saudi Arabia Jun % 100% 0% 100% -8.53% % 43.69% % 5 Asayel Bank Al Bilad Saudi Arabia Jan % 90% 0% 100% -9.00% % 34.15% % 6 Al Rajhi Local Shares Al Rajhi Bank Saudi Arabia Jul NA NA NA 0% -7.74% % 69.40% % 7 Amanah Saudi Industrial HSBC Saudi Arabia Saudi Arabia Apr % 100% 0% 100% -6.33% -9.00% 93.43% % 8 Al-Saffa Saudi Equity Trading CAAM Saudi Farnsi Saudi Arabia Jul NA NA NA 0% -6.74% % 57.89% % 9 SHB: Saudi Equity Trading Saudi Holandi Capital Company Saudi Arabia Jul NA NA NA 0% -5.27% -4.55% 50.24% % 10 Al Mubarak Pure Saudi Equity Arab National Bank Saudi Arabia Nov NA NA NA 0% % % 23.56% % 11 Falcom Saudi Equity FALCOM Financial Services Saudi Arabia Apr NA NA NA 0% -5.84% -6.10% 40.38% % 12 AlAhli Saudi Dynamic Trading Equity NCB Capital Saudi Arabia Apr % 11% 0% 100% -1.88% -8.32% 11.33% % 13 Al Taiyebat Saudi Equity Bank Al Jazira Saudi Arabia Dec NA NA NA 0% -7.47% % 22.80% % 14 Jadwa Saudi Equity Jadwa Investment Saudi Arabia Jun % 94% 0% 100% -8.58% % 61.39% % 15 SAIB Saudi Companies SAIB Asset Management Company Saudi Arabia Apr % 76% 0% 100% -4.83% % 50.72% % 16 Amanah Growth Portfolio HSBC Saudi Arabia Saudi Arabia Jan NA NA NA 0% -3.40% -6.51% 33.76% % 17 Bakheet Saudi Trading Equity Bakheet Investment Group Saudi Arabia May-07 6 NA NA NA 0% -7.48% % 71.06% % Total 6,162 2% 65% 0% 67% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months Conventional s Asset Allocation Performance (%) Name Country Focus Inception Size ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (% ) 2 LTM Risk 3 1 Riyad Equity 3 Riyad Capital Saudi Arabia Dec-00 1,202 NA NA NA 0% -6.80% % 53.44% % 2 SABB Saudi Equity HSBC Saudi Arabia Saudi Arabia Oct % 99% 0% 100% -6.75% % 62.21% % 3 Al Musahem Samba Financial Group Saudi Arabia May NA NA 0% 0% -4.88% % 47.92% % 4 SABB Saudi Equity Trading HSBC Saudi Arabia Saudi Arabia Nov NA NA NA 0% -6.70% -7.71% 66.48% % 5 Saudi Gateway SHUAA Capital Saudi Arabia Jul % 99% 0% 100% -4.93% -9.35% 35.76% % 6 Riyad Equity 1 Riyad Capital Saudi Arabia Dec NA NA NA 0% -6.52% % 58.56% % 7 Financial Institutions HSBC Saudi Arabia Saudi Arabia Aug % 96% 0% 100% % % 35.91% % 8 Saudi Istithmar CAAM Saudi Farnsi Saudi Arabia Apr NA NA NA 0% -7.51% % 56.65% % 9 ANB Saudi Companies Arab National Bank Saudi Arabia May % 62% 0% 100% -5.39% -8.93% 30.32% % 10 ANB Saudi Equity Arab National Bank Saudi Arabia Apr % 94% 0% 100% -5.86% % -6.17% % 11 SAIB Saudi Equity SAIB Asset Management Company Saudi Arabia Jul NA NA NA 0% -5.73% -9.28% 46.54% % 12 Bakheet IPO Bakheet Investment Group Saudi Arabia Mar NA NA NA 0% NA NA 0.00% NA NA 13 Al Fareed Samba Financial Group Saudi Arabia Dec NA NA 0% 0% % % 71.66% % 14 SHB Saudi Companies Equity Saudi Holandi Capital Company Saudi Arabia Nov NA NA 0% 0% -7.11% -8.07% 55.64% % Total 3,656 1% 24% 0% 25% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Source: Markaz Analysis, Zawya, Lipperweb, Stock exchange websites Kuwait Financial Centre Markaz 25

26 Appendix 3: Kuwait Equity s Statistics Sharia compliant s Asset Allocation Performance (%) Name Country Focus Inception Size ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 1 Markaz Islamic Kuwait Financial Centre Kuwait Oct % 91% 0% 100% -5.30% 8.40% 34.93% 30.56% 19.09% 2 Al Safwa Investment National Investments Company Kuwait May NA NA NA 0% -3.74% 11.72% 26.45% 25.74% 17.07% 3 Al Darij Investment National Investments Company Kuwait Jun NA NA NA 0% -4.33% 5.80% 27.68% 30.63% 16.50% 4 Al Dar Securities Al Dar Asset Management Kuwait Oct % 91% 0% 100% -2.09% 14.66% 20.11% 29.05% 15.58% 5 Al Seef Bank Al Bilad Kuwait Jan NA NA NA 0% -1.00% 17.61% 32.26% 15.33% 20.76% 6 Tijari Islamic Commercial Bank of Kuwait Kuwait Jul % 88% 0% 100% -5.76% 11.31% 26.23% 24.20% 20.42% 7 Al Nokhba Al Dar Asset Management Kuwait Oct % 89% 0% 100% -4.99% 5.05% 1.61% 14.15% 15.16% 8 Al Wasm Kuwait Finance and Investment Company Kuwait Jun NA NA NA 0% 4.67% 17.63% 1.94% 8.90% 27.11% 9 Tharwa Islamic Tharwa Investment Company Kuwait Jun % 90% 0% 100% -4.35% 9.25% 0.46% 12.75% 15.39% 10 Al Huda Islamic Gulfinvest International Kuwait Jun NA NA NA 0% % 1.40% 9.62% 18.68% 20.99% 11 Al-Durra Islamic * Global Investment House Kuwait May-04 NA 2% 98% 0% 100% -0.95% 17.71% 32.75% 0.00% 0.00% Total 918 1% 10% 0% 11% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Conventional s Asset Allocation Performance (%) Name Country Focus Inception Size ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 1 Al Wataniya Investment National Investments Company Kuwait Jul NA NA NA 0% -6.55% 3.95% 43.37% 31.2% 19.94% 2 Al-Raed Kuwait Investment Company Kuwait Oct NA NA NA 0% -4.30% 6.26% 21.42% 30.2% 15.73% 3 Markaz Investment and Development F Kuwait Financial Centre Kuwait Jul % 96% 0% 100% -6.50% 6.92% 25.60% 29.8% 18.78% 4 Tijari Investment Commercial Bank of Kuwait Kuwait May % 97% 0% 100% -8.73% 4.41% 37.96% 21.2% 21.20% 5 Burgan Equity Burgan Bank Kuwait Dec % 77% 0% 100% -3.34% 11.35% 27.27% 18.2% 15.30% 6 Coast Investment Coast Investment and Development Company Kuwait Mar % 95% 0% 100% -5.51% 4.58% 37.32% 10.5% 18.18% 7 Markaz Forsa Kuwait Financial Centre Kuwait Jun % 94% 0% 100% -5.50% 6.03% 20.36% 20.9% 15.64% 8 KAMCO Investment Kipco Asset Management Company Kuwait Apr % 68% 1% 100% -3.74% 9.23% 44.23% 20.4% 16.65% 9 Al Ahli Kuwaiti Al Ahli Bank of Kuwait Kuwait Feb % 84% 0% 100% -4.00% 9.76% 38.73% 29.6% 19.61% 10 Markaz Mumtaz Investment Kuwait Financial Centre Kuwait Dec % 97% 0% 100% -4.40% 10.92% 44.43% 36.2% 21.38% 11 Al-Shorooq Investment Gulfinvest International Kuwait Jul NA NA NA 0% % % 18.83% 20.0% 29.32% 12 Global Local Global Investment House Kuwait Jan % 97% 0% 100% -3.87% 8.37% 12.65% 27.2% 16.39% 13 Tharwa Investment Tharwa Investment Company Kuwait May % NA 0% 0% -6.35% 9.66% 7.62% 21.2% 19.85% 14 Kuwait Gateway SHUAA Capital Kuwait Nov % 87% 0% 100% -4.61% 10.71% 40.27% 17.4% 17.48% 15 Al Rou'yah * Kuwait and Middle East Financial Investment CompKuwait Jun-02 NA 17% 83% 0% 100% -2.27% 8.46% 33.11% 26.9% 0.00% 16 NBK Kuwait Equity * National Bank of Kuwait Kuwait Jun-07 NA 1% 99% 0% 100% -5.94% 8.46% -3.00% 7.7% 0.00% Total 5,356 9% 80% 0% 89% 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Source: Markaz Analysis, Zawya, Lipperweb Kuwait Financial Centre Markaz 26

27 Appendix 4: Qatar Equity s Statistics Sharia compliant s Asset Allocation Performance (%) Country Size Name Focus Inception ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 1 Al-Beit Al-Mali Shariah Compliant * Qatar National Bank Qatar Sep-06 NA 5% 95% 0% 100% % -2.95% 21.41% % 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Conventional s Asset Allocation Performance (%) Name Country Focus Inception Size ($Mn) Cash Equities Bonds Total Mar-08 YTD CAGR (%) 2 LTM Risk 3 1 Makaseb Qatar Equity Mashreq Qatar May % 98% 0% 100% -6.25% 2.24% 50.45% % 2 NBK Qatar Equity * National Bank of Kuwait Qatar May-06 NA 2% 98% 0% 100% -7.04% 0.00% 51.72% % 3 Qatar Gate (N)* Amwal Qatar Sep-05 NA 2% 98% 0% 100% -6.88% 2.61% 36.09% % 4 Qatar Gate (Q)* Amwal Qatar Sep-05 NA 0% 100% 0% 100% -7.25% 2.61% 38.81% % 5 Al Watani * Qatar National Bank Qatar Oct-05 NA 5% 95% 0% 100% -7.79% 0.00% 51.72% % 6 Al Watani 2* Qatar National Bank Qatar Oct-05 NA 10% 90% 0% 100% -7.47% -3.93% 32.51% % 1 YTD - Year to Date, 2 - CAGR: Compounded Annual Growth Rate,, 3 - LTM Risk: Standard Deviation of returns for the last 12 Months * size is not available Source: Markaz Analysis, Zawya, Lipperweb Kuwait Financial Centre Markaz 27