Kenanga Investors has launched the Kenanga Sustainability Series: Emergency Waqf Musa’adah Fund. The fund, which was formerly known as the Kenanga Islamic Balanced Wholesale Fund – Series 1, will assign a portion of returns to those affected by climate-related disasters.
The new fund is the fourth product launched under the Kenanga Sustainability Series and its second Waqf-featured fund following the Waqf Al-Ihsan fund launched in April 2021. The fund is the first Shariah compliant fund in the Kenanga Sustainability Series. It aims to generate sustainable returns and allows investors to allocate 70% of the fund’s returns toward socially impactful projects contributing to climate-related disaster control and pandemic control.
The Shariah compliant mixed asset fund was originally launched on the 20th November 2015 under the ‘Kenanga Islamic Balanced Wholesale Fund – Series 1’ name. Subsequently, the fund, under its old name, was approved by the Securities Commission Malaysia as an SRI fund on the 24th February 2022. It was rebranded and launched as the Kenanga Sustainability Series: Emergency Waqf Musa’adah Fund on the 6th October 2022.
“For us to integrate the concept of sustainable and responsible investment and Waqf-featured funds, which is in line with the Securities Commission Malaysia guidelines, we rebranded our dormant balanced wholesale fund, Kenanga Islamic Balanced Wholesale Fund – Series 1, to the ‘Kenanga Sustainability Series: Emergency Waqf Musa’adah Fund’ as the fund aims to primarily provide income distribution as well as achieve capital growth by investing in local and global diversified portfolios of Shariah compliant equities, Shariah compliant equity-related securities, Sukuk, Islamic money market instruments or Islamic deposits that integrate both Shariah principles as well as principles of sustainable investing,” Zulkifli Ishak, CEO of Kenanga Islamic Investors, told ISFI.
The fund is a result of Kenanga Investors’s collaborative efforts with Yayasan Waqaf Malaysia (YWM) and Match Foundation (MATCH). It signed an MoU with YWM and MATCH in November 2021, which appointed it as the fund manager of funds received from institutional investors as well as an initial seed funding of RM3 million (US$637,554) allocated in Budget 2022 as part of the government’s efforts to create a national Waqf fund specifically to assist those affected by climate change-related disasters or future pandemics.
The launch of the fund also follows the research conducted by the Foreign Commonwealth and Development Office and PwC Malaysia as a consultant for the Islamic social finance space.
A total of 28 potential stakeholders including representation from government agencies, Islamic asset management companies, state religious Islamic councils, academia and non-governmental organizations were engaged to share their insights in managing similar programs as a precursor to establishing the fund.
The fund has a minimum initial investment amount of RM10,000 (US$2,125). Benchmarked against an income distribution of 4%, the fund is suitable for sophisticated investors with a medium- to long-term investment horizon.