Amana-Candor Shariah Fund pays attractive tax free dividend to unit holders
Thursday, 13 March 2014 00:00
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The Amana-Candor Shariah Fund has paid a tax-free dividend of Rs. 0.75 per unit to its unit holders after the completion of its first year in operation. The Amana-Candor Shariah Fund has appreciated by 10.99% for the year ended 31 December 2013.
The Fund, which is a Shariah-compliant, balanced unit trust can invest in white-listed shares and in Shariah income securities. The Fund is an open-ended one, enabling unit holders to enter and exit the Fund at any time.
“As a new fund, our challenge was to make sure there was steady growth in the fund’s assets during a year in which the share market was volatile. Despite the volatility in the share market in 2013, we invested in quality shares with long term growth potential at attractive valuations,” said Amana-Candor Shariah Fund, Fund Manager Ravi Amarasinghe. Amarasinghe is no stranger to managing Shariah Funds, being the Manager of the first Shariah fund launched in Sri Lanka which was adjudged the best performing Shariah fund in mid 2010, beating 299 Shariah funds tracked by Bloomberg.
The dividends paid out are tax-free in the hands of the unit holders and they have the option to reinvest their dividends back into the fund for more units or receive the dividend to their hand.
This fund is an attractive investment for Shariah-conscious investors who are seeking to diversify their investments beyond income generating instruments such as Mudaraba savings and Mudaraba term deposits, since the Amana-Candor Shariah Fund also invests in white listed shares; this diversification in to Shariah compliant shares will benefit investors considering the present low income generating environment. As a balanced fund (a fund that can invest in Shariah compliant shares as well as fixed income securities) this fund will generate returns from both forms of asset classes, i.e. equity and income.
“The Fund will continue to be managed to provide unit holders with attractive annual dividends whilst investing in shares that have underlying value in them; this will enable the unit holder to be part of a portfolio that has true value in it and which would grow over time,” Amarasinghe stated.
The fund management company, Candor Asset Management Ltd., although a relatively new unit trust company in the country, has employed senior executives with many years of experience in asset management, fund valuation and risk and compliance. The company is part of the Candor Group based in Sri Lanka which is owned by Eagle Proprietary Investments Ltd. (EPIL). EPIL is a Dubai based globally diversified, private investment company. EPIL is committed to its businesses in Sri Lanka and to provide value to Sri Lanka’s financial sector.
The technical partner of the Amana-Candor Shariah Fund is Amana Capital Ltd., who provides the White List of shares and also a list of investible entities for fixed income securities. Moreover, the Fund has a trustee, Deutsche Bank, who monitors the investments of the Fund to ensure that the fund management company, Candor Asset Management, invests in a manner which is consistent with the mandate of the Fund. The SEC is the regulator of the Fund.
