United GCC Fund First Mutual Fund for Oman’s United Securities
One of Oman’s largest brokerage and investment firms announced the launch of its first mutual fund investment vehicle, adding itself to the short list of financial companies offering this option to investors. United Securities will be creating the pan-GCC fund, known as United GCC Fund, as an open-ended fund in which both foreigners and Omani nationals can invest. The fund will be opening with a targeted body fund of RO10 million, aimed at the Oman market, beginning as early as next week.
Last year the Oman Arab Bank began its Oman Al Arabi Fund, the very first open-ended mutual fund scheme in Oman which is especially interested in targeting the Omani market. The United GCC Fund of United Securities is the second mutual fund scheme after the Oman Al Arabi Fund.
“Unlike other GCC funds, which invest a significant portion in Oman and a small portion in other Gulf Cooperation Council (GCC) states, our investment decision will depend on the opportunities in each market and will vary from time to time,” Deepak Radhakrishnan, fund manager at United Securities.
This fund is especially designed to attract smaller investors in Oman, with a minimum investment of only RO3000 required. There is no upper limit in the amount that can be invested in the fund.
The unit price of each share of the fund will be set at RO1, and it is expected that this scheme will bring increased stability to the county’s bourse as well as help to develop and strengthen Oman’s mutual fund market.
The opening subscription period for this fund is one month. After that investors will be able to purchase more shares at the latest net asset value. The main goal of the United GCC Fund is to allow small investors to get involved in the equity marketplace.
Now Is the Time
Radhakrishnan addressed himself to the instability now prevalent in the Middle East and the recent fall in share prices due to this uncertainty.
“We believe that it is the right time to invest, as the valuations are more realistic now. Many of the negative factors have already been discounted in the stock market. The panic is over and we do not expect any further panic.”
The government watchdog for the investment and financial marketplace in Oman, the Capital Market Authority, (CMA), has already given its blessing to the new mutual fund scheme.
On the issue of what kind of return on investment can be expected from this fund Radhakrishnan said:
“We are aiming to beat the GCC benchmark. Our aim is to give a better return than the GCC benchmark.”