HSBC launches its first Islamic principal protected fund

HSBC Amanah Finance has launched the first in a series of investment funds in compliance with Shariah (Islamic law). The HSBC Amanah Principal Protected Funds (APPF) have been developed in consultation with, and approved by, the HSBC Shariah Supervisory Board.

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By  Massoud Derhally Published  January 6, 2002

HSBC Amanah Finance has launched the first in a series of investment funds in compliance with Shariah (Islamic law). The HSBC Amanah Principal Protected Funds (APPF) have been developed in consultation with, and approved by, the HSBC Shariah Supervisory Board.

The first fund in the APPF series is the Amanah European Basket Protected Fund, which opened for subscription on 15 November 2001, coinciding with the beginning of Ramadan. Subscriptions will close on 15 January 2002. The minimum investment is US$5,000.

The HSBC Amanah European Basket Protected Fund is designed to achieve medium-term capital growth through a diversified portfolio strategy as well as offering a 100 per cent principal protection at maturity regardless of the performance of the equity markets. Capital growth will derive from exposure to a basket of leading European companies that have been approved by the HSBC Shariah Supervisory Board. The Fund is available from HSBC branches in selected GCC markets.

Iqbal Ahmad Khan, chief executive, HSBC Amanah Finance, said: “The Amanah Principal Protected Funds provide investors wishing to follow Islamic principles in their investments with an opportunity to protect their capital in these uncertain times while capturing upswings in the equity markets.

“Earlier this year HSBC launched of a full range of Islamic funds, comprising regional equity funds, a managed currency fund - a truly Shariah compatible alternative investment. Now, with the APPF, our customers have access to defensive as well as aggressive strategies for investment.”

“APPF are designed as fixed term investments, but are flexible to allow early redemption if target performance is achieved prior to their term. Thus, a medium- term investment can be transformed into a short-term investment with enhanced yield, subject to market performance,” he added.

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