Listed on the Saudi Exchange on the 17th July 2024, closed-end Shariah compliant Alkhabeer Diversified Income Traded Fund 2030 aims to generate periodic income for investors.
Maturing six years from the listing date, the fund’s assets shall be sold upon termination and net asset value shall be distributed to unitholders – who are restricted to Saudi Arabian nationals and qualified GCC residents, including foreigners and corporate entities.
Managed by Alkhabeer Capital, the fund invests in various income generating asset types such as Sukuk, trade finance, senior secured loans, structured income notes, income funds and Murabahah transactions.
Table 1: Investment portfolio for Alkhabeer Diversified Income Traded Fund 2030
| Instrument | Investment focus |
| Sukuk | Sovereign, quasi-sovereign or corporate Sukuk issued locally and internationally as a public offering or private placement, whether listed or unlisted. Fund manager may also invest in any sub-investment grade or non-rated Sukuk, up to a maximum of 30% of total Sukuk. |
| Trade finance transactions | Short-term and asset-backed and/or insurance-backed trade finance transactions entered into with a counterparty regulated by the Saudi Central Bank or by a regulatory agency abroad comparable to the Saudi Central Bank. |
| Leasing transactions | Fund manager may invest in leasing transactions with a counterparty, who may be unrated or who does not have a credit rating, in sectors that include transportation, public utilities, maritime transport, cleaning and maintenance, chemicals production, food packaging and healthcare. |
| Structured income notes | Credit securities issued by governments and/or companies, or private finance transactions executed in global markets, including in sub-investment grade or unrated instruments up to a maximum of 30% of the total portfolio. |
| Senior secured loans | Publicly or privately-offered structured financing tranches of different investment grades and preferences in the accrual of returns, which can include corporate loans to diverse companies in terms of activities and sectors. Fund manager may invest in sub-investment grade, up to a maximum limit of 30% of the total portfolio. |
| Income funds | Funds that invest in various income-generating asset types, including but not limited to finance, leasing transactions, Sukuk and Murabahah funds. Covers public funds as well as funds offered through private placement, capped at 25% of the fund’s net asset value. |
| Murabahah transactions | Counterparty deals directly with local, regional or international banks with investment grade credit and regulated by the Saudi Central Bank or a comparable regulatory authority. |
| Illiquid assets | Over 10% of assets may be invested in illiquid assets, provided that not more than 25% of the fund’s net asset value is invested in a single illiquid asset. |
Classified as high risk, this fund tracks a composite index comprised of the Dow Jones Sukuk investment grade total return (70%) and the remainder 30% in the Secured Overnight Financing Rate for three months (SOFR 3M Shariah compliant index). It will not invest in financial derivatives.
Having a maximum SAR1 billion (US$266.44 million) size, with initial entries from SAR1,000 (US$266.45), distributions will be conducted twice yearly in February and August.
*Disclaimer: The opinions and viewpoints expressed in the Fund Profile do not constitute as a recommendation for any funds highlighted. The information presented is not investment advice and should not be treated as such.
| Alkhabeer Diversified Income Traded Fund 2030 | |
| Fund manager | Alkhabeer Capital |
| Launch date | 28th April 2024 |
| Asset class | Mixed assets |
| Base currency | Saudi riyal (SAR) |
| Composite benchmark | Dow Jones Sukuk investment grade total return (70%); and Secured Overnight Financing Rate for three months (SOFR 3M Shariah compliant index) |
| Investment objective | To generate periodic income by investing in income-generating assets compatible with Shariah guidelines |
| Distribution | Semi-annual |
| Listings | Saudi Market (Tadawul) on the 17th July 2024 |
