Asset manager Arman Eghtesad Asset Management (Arman AMC) shared with IFN Investor two contrasting strategies offered to its clients – which aim to address underlying concerns of investors about how to preserve asset values amid high annual inflation rates in Iran.
CEO Farnaz Akbarzadeh Etehad said the firm will conduct risk profile interviews with the client before recommending either the ‘risk-free investment’ option or to create an ‘inflation shield’.
For the first option, clients would be advised to invest in the Arman Ekhetaz Fixed Income Fund in combination with the Arman Karad crowdfunding platform – both are managed with the support of Arman AMC’s parent firm, Arman Ekhtaz Trading.
Farnaz said this combination would offer higher returns compared to the steady, fixed income stream from bank deposits or government-backed Islamic securities and Sukuk.
Matching investors with these private credit opportunities – which feeds into both new and established companies seeking capital via the crowdfunding platform – would result in higher profits with minimal risk due to the bank guarantees for both the principal and profit amounts.
“While there are many such opportunities, assessing their ability to repay can be tricky sometimes. By making sure our client investments are done right, we can see profit rates of over 25% going to investors after the applicable fees and costs are deducted.”
Farnaz explained the ‘inflation shield’ is actually a natural hedging mechanism by investing in multiple asset classes – rather than the traditional main focus in equity markets – stating that the latter’s returns in recent years are viewed internally by the firm’s analysts as low, comparable to those from fixed income instruments.
In seeking better returns via the ‘inflation shield’, Arman AMC adopted a business strategy of relying heavily on barter trading in various commodities and assets by partnering on its parent firm’s deals.
Farnaz cited a recent example when the parent firm helped structure a financing deal involving the bulk sale of 150 six-ton sleeper cab trucks – which Arman AMC was able to offer as a private investment deal to its clients and channeling the monies as an additional funding source for its parent firm.
“Clients who have gained from these two strategies would eventually ask to take on other investment opportunities, this is a trend that continues to grow our client base since the Arman group was established in 2013.”
This report was produced by IFN Investor editor Francis Nantha & data analyst Arash Malekfard
