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Lahore, February 19, 2016 (PPI-OT): The Pakistan Credit Rating Agency has assigned capital protection rating of “CP2+”(CP Two Plus) to Pakistan Sarmaya Mehfooz Fund managed by MCB-Arif Habib Investment Management Limited. The rating denotes very strong certainty of capital protection.
The rating recognizes the fund’s conservative investment philosophy pursued by the management company. This is reflected in legal capping of equity investment to 50% with rest of the exposure going to fixed income avenues. At end-Dec15, the fund was ~28% invested in equities. This investment was predominantly covered by top 10 holdings, comprising good quality stocks and reflecting a manageable universe. The fixed income portion comprises cash and bank deposits and government securities.
The cash and placements can be made with banks, rated not lower than “AA-” (Double A Minus). At end-Dec15, the fund had invested (~30%) to government securities while cash and bank deposits were with banks rated from AAA (Triple A) to AA (Double A). The fund’s philosophy of keeping equity invested at maximum of 50% has helped in keeping the multiple relatively on lower side. The rating incorporates that the management company has provided a gap risk coverage of 5%. At the same time, the asset manager rating of the management company lends support.
Pakistan Sarmaya Mehfooz was launched on 19-Dec-14, based on the Constant Proportion Portfolio Insurance model. With a fund size of PKR 683mln, the fund’s NAV stood at 106.8 at end-Dec 15. The fund has made a return of 10.11% since inception. The maturity is on December19, 2016. The rating remains dependent on continued compliance with the predefined parameters. PACRA would monitor the compliance on a monthly basis.
For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com