Invest AD, the Abu Dhabi Government-owned investment company, is joining with a Hong Kong financial company to offer east Asian investors access to Middle East stocks. Invest AD will pick regional stocks for the clients of Quam who are based in Taiwan and Hong Kong. "Middle East markets are outperforming global markets this year, but they still have much further to go to catch up with the rebound that most emerging markets experienced last year," said Mohammed al Hashemi, the head of asset management at Invest AD.
Quam said the partnership would help its clients diversify their portfolios with Middle East stocks. It is planning to launch a fund comprising Middle Eastern companies from various sectors within weeks, it said. "Investors in Asia are looking for diversification, especially now, when key western and Asian markets have had a good run and look fully valued. There are many opportunities materialising in the Middle East across different sectors," said Bernard Pouliot, the chairman of Quam.
In the first four months of this year, Middle East markets have outperformed most of the world. The MSCI Arabian Markets Index has risen 15.1 per cent from the end of last year compared with a 3.6 per cent increase in the MSCI Emerging Markets Index and a gain of 3.3 per cent for the MSCI World Index. But within the Middle East, the Gulf markets have lagged. The Dubai Financial Market General Index has lost about 13 per cent from a year earlier, while the major stock benchmarks in Abu Dhabi, Saudi Arabia, Kuwait and Qatar have each shed between 3 per cent and 6 per cent of their value this year.
Invest AD manages four of its own equities funds invested in the Middle East and Africa. And like this new deal with Quam, it also advises the German private bank BHF Bank on selecting stocks. Invest AD handles stock and private-equity investments for third parties and also acts as a proprietary investor for the government. Earlier this year, Invest AD disbanded its 18-month foray into investment banking and cancelled plans to offer a new property fund to outside investors. This followed earlier reports that the company had shut down an infrastructure fund set up as a joint venture with UBS's asset management division in 2008. That fund was to raise US$600 million (Dh2.2 billion) to invest in infrastructure projects in the MENA region.
Many financial companies have been forced to adjust to waning investor appetite, reduced bank financing and declining stock and property prices. In addition to managing funds, Quam also offers services ranging from wealth management to investor relations. It also has offices in China and a network of affiliated partners in locations ranging from Japan to Africa and the US. uharnischfeger@thenational.ae