D’Namaz Halal Fixed Income Fund

The D’Namaz Halal Fixed Income Fund, launched on the 21^st May 2025 by D’Namaz Capital, is a Shariah compliant fixed income fund that aims to provide a less risky alternative to equity-based investments.

The Nigeria-domiciled fund is structured for medium- to long-term investors who prioritize capital preservation and seek to earn returns through a varied portfolio comprising government, sub-national and corporate Sukuk as well as Shariah compliant fixed-term deposits, Murabahah contracts and Ijarah leases.

Priced at NGN100 (US$0.06) per unit to appeal to a range of investors including institutions and individuals, the fund’s minimum initial investment is NGN10,000 (US$6.29). Additional investments will be in multiples of NGN5,000 (US$3.14).

D’Namaz Capital Investment Analyst and Research Lead Habib Salis said this open-ended fund was designed in response to investor demand for Shariah compliant options that also focus on income stability.

“Understandably, the current economic environment, marked by persistent inflation and changing interest rates, has heightened the need for capital-preserving strategies.”

The fund employs a multi-layered risk management approach. Diversification is a core component, with investments spread across various fixed income instruments to reduce concentration risk, Habib explained.

“We spread risk of changes in interest rate in a way that no two or more items of the fund’s portfolio are perfectly correlated. The portfolio is regularly stress-tested to gauge its response to shifts in monetary policy or other macroeconomic factors.”

The fund uses duration management strategies to adjust exposure based on interest rate expectations. “Shorter durations are used when rates are expected to rise, and longer durations are implemented when rates are expected to decline. The fund also prioritises credit quality by focusing primarily on investment-grade Sukuk.”

A portion of the portfolio may be allocated to lower-rated instruments with acceptable risk profiles, and some assets are kept in liquid, short-term instruments to ensure redemption needs can be met.

Unlike passive fixed income funds, which often track predefined indices, the D’Namaz Halal Fixed Income Fund follows an actively managed approach. This allows adjustments to be made based on changing market conditions.

The fund’s allocation strategy is flexible. Asset allocation is determined by macroeconomic conditions, investor risk tolerance and liquidity requirements. Under typical circumstances, the fund is expected to allocate 70-100% of its assets to Sukuk.

The remaining portfolio may include Shariah compliant fixed-term investments and income contracts of up to 30%, while cash holdings are generally kept at no more than 5%.

“D’Namaz Capital has initiated outreach efforts to highlight the fund’s features to prospective institutional investors such as pension fund administrators and insurance firms. We hold monthly webinars with invited experts, direct engagement sessions on the fund’s structure, compliance process and strategy,” Habib shared.

Distribution of income will be to unit holders twice per year. Investors may choose to receive distributions in cash or reinvest them in additional units of the fund.

*Disclaimer:  The opinions and viewpoints expressed in this 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.

Source: D’Namaz Capital