Daiwa AM will launch Singapore’s first Shariah-compliant Exchange Traded Fund (ETF) on SGX on 27 May 2008.
The Daiwa FTSE Shariah Japan 100 (DaiwaETF) will offer Islamic investors instant access to the top 100 Shariah-compliant companies in Japan by market capitalisation.
Shariah is the divine Islamic law that governs the practical aspects of a Muslim’s daily life. The DaiwaETF seeks to track the performance of the FTSE Shariah Japan 100 Index, which is designed to represent the return of the largest and most liquid listed companies in Japan that comply with Islamic legal principles.
“The DaiwaETF is the first Shariah-compliant ETF in Singapore and also our first ETF in Singapore. This ETF serves as an excellent proxy to the growth prospects of some of the best listed companies in Japan. Islamic investors can be assured that this ETF is in full compliance with the Shariah investment principles at all times as Yasaar Limited will be undertaking the Shariah screening at the fund level.
“We believe that the DaiwaETF will be well-received as it provides Islamic investors with a time-efficient, cost-effective and low risk investment avenue, based on the use of an indexing investment approach for a basket of reputable Japan companies,” says Michihito Higuchi, president and CEO, Daiwa Asset Management Co. Ltd, the parent company of Daiwa AM.
“As Singapore’s first Shariah-compliant ETF, the DaiwaETF offers investors easy and affordable access to the largest and most liquid Japanese listed companies that comply with Islamic legal principles. This product launch is timely as demand for Shariah-compliant funds in Asia has been rising strongly on the back of increasing interest from Islamic investors from the Middle East. It brings the total number of SGX-listed ETFs to 19 and expands on our current suite of comprehensive Asian products offering investors convenient access to Asian markets,” says Chew Sutat, executive vice president and head of Development, SGX.
“The launch of the DaiwaETF is a positive direction in so many ways, being the first Islamic ETF to be launched by Daiwa and also the first one to be listed on SGX. We are very enthusiastic about our continued involvement with SGX and its pioneering offerings to cater to the requirements of the Shariah-compliant market. The cost-effective, broad-based access to the market through the means of the ETF for investors, giving exposure to the Shariah compliant Japanese stocks, is a major step forward,” adds Majid Dawood, CEO of Yasaar Limited.
While the DaiwaETF was created to cater to the expanding needs of Islamic investors for greater investment alternatives, Daiwa AM expects it will also appeal to non-Islamic investors internationally. Besides offering exposure to top-tier companies in Japan, the ETF’s excellent sector diversification is an attractive proposition for professional and retail investors seeking to participate in Japan’s stock market.
Daiwa Asset Management Co. Ltd. of Japan has been appointed as the Investment Adviser for the DaiwaETF and will leverage on its proven track record in managing ETFs to provide assistance and advice to Daiwa AM with respect to the management of the investments and operational processes of the DaiwaETF.
Daiwa AM has also appointed DBS Trustee Limited as the Trustee, Custodian and Registrar for the DaiwaETF.