Shariah-compliant equity funds tend to perform better than conventional equity funds during periods of market downturns. Why is that so?

This is mainly because Shariah-compliant funds do not invest in the following stocks which tend to underperform the broader markets during periods of market consolidation:

Public Mutual’s Investment Strategy in Managing Shariah-compliant Funds:

1. Our Shariah-compliant funds have focused their positioning in:

Sectors that are considered to be more resilient, such as:			Sectors with growth potential:
	Healthcare		Technology
	Consumer		E-commerce
			Industrial & Manufacturing

2. Our foreign Shariah-compliant funds generally focus on:

• Companies that are well-positioned to leverage on the growth of the global digital revolution.
• Established corporate leaders with a strong competitive advantage in the industries they operate, dominant market shares as well as a strong global presence.
• Companies with low leverage, healthy balance sheets and relatively lower volatility of earnings.

3. The Shariah screening process removes companies with high levels of debt from the stock universe of Shariah-compliant funds. Companies with reasonable debt levels tend to be more resilient during the economic downturn and this, in turn, helps to reduce the funds’ volatility.

Investors are advised to read and understand the contents of the relevant fund’s Prospectus/Supplemental Prospectus/Information Memorandum and the Product Highlights Sheet (PHS) before investing. Investors should understand the risks of the fund(s), compare and consider the fees, charges and cost involved in investing in the fund(s). A copy of the Prospectus/Supplemental Prospectus/Information Memorandum and PHS can be viewed at our website www.publicmutual.com.my. Investors should make their own assessment of the merits and risks of the investment. If in doubt, investors should seek professional advice. Please refer to www.publicmutual.com.my for our investment disclaimer.