HSBC Holdings PLC · LSE:HSBA
HSBC — HSBC Amanah Funds SICAV — Investor Presentation (March 2009)
35 slides from HSBC's investor presentation, March 2009
Slide 1: HSBC Amanah Funds SICAV Product range
HSBC Amanah Funds SICAV Product range ` hsbcamanah.com
Slide 2: HSBC Amanah
HSBC Amanah ` HSBC Amanah is the Islamic financial services division of the HSBC Group ` Headquartered in Dubai with regional representatives in New York, Riyadh, London, Jakarta and Kuala Lumpur ` HSBC Amanah is one of the leading global players in the Islamic finance industry ` HSBC Amanah SICAV i
Slide 3: Shariah compliant investments
Shariah compliant investments The concept ` Shariah (Islamic law) is based on the Quran (the sacred text of Islam) and the example of Prophet Muhammad, Peace Be Upon Him (PBUH) ` The most distinctive element of Islamic finance is the prohibition of interest, whether “nominal” or “excessive,” simple
Slide 4: Compliance with Shariah
Compliance with Shariah Central Shariah Committee ` All Shariah compliant investments must be certified by experts in Shariah ` Three scholars of international repute serve on the HSBC Amanah Shariah Committee: Sheikh Sheikh Dr Dr Mohamed Mohamed Sheikh Sheikh Nizam Nizam Dr. Dr. Muhammad Muhammad I
Slide 5: Compliance with Shariah: screening and purification process
Compliance with Shariah The screening and purification process ` The Central Shariah Committee of HSBC Amanah has determined that Investment funds will not invest in companies whose primary business activity is as shown in Figure 1 (sectoral screens), or in companies which exhibit characteristics as
Slide 6: HSBC Global Asset Management
HSBC Global Asset Management Active Active fundamental fundamental Cash Cash management management Multimanagement Multimanagement specialist specialist Quantitative Quantitative specialist investing specialist investing with with specialist specialist conviction aiming aiming toto select select the
Slide 7: SINOPIA Asset Management
SINOPIA Asset Management Quantitative specialist of HSBC Global Asset Management ` SINOPIA was formed in 1989, as a Assets under management by investment type* subsidiary of HSBC France 21.20% ` SINOPIA is headquartered in Paris, with subsidiaries in Hong-Kong and 36.80% London. The company manages
Slide 8: SINOPIA's Core Beliefs
SINOPIA's Core Beliefs Investment philosophy and beliefs ` Markets exhibit mispricings we can exploit – Markets are rational and efficient on average: – they fully and correctly reflect all relevant information in determining long-term security prices – an asset equilibrium or fair price can be iden
Slide 9: SINOPIA's Process Principles
SINOPIA’s Process Principles Investment process: discipline and transparency 1. 1. Valuation Valuation 2. 2. Optimization Optimization Our quantitative traits Synthesize Synthesize market market & & economic economic data data Expected Expected returns returns plus plus risk risk factors factors ` S
Slide 10: HSBC Amanah Funds SICAV Product offering
HSBC Amanah Funds SICAV Product offering HSBC HSBC Amanah Amanah Global Global Equity Equity HSBC HSBC Amanah Amanah Global Global Equity Equity Index Index (Active (Active Quantitative Quantitative management) management) (Full (Full Replication Replication strategy) strategy) HSBC HSBC Amanah Aman
Slide 11: Equity Index strategy
Equity Index strategy A pragmatic full replication strategy for the HSBC Amanah Global Equity Index fund ` Objective is to replicate the performance of an equity universe which meets Islamic investment principles ` The strategy tracks a given index under the following constraints: – Minimise trackin
Slide 12: Indexed investment process
Indexed investment process A structured and disciplined process… Preliminary Preliminary Index Index Portfolio Portfolio Trading Trading Analysis Analysis Trade Trade Analysis Analysis Construction Construction and Implementation and Implementation Execution Execution Index Index & & portfolio portf
Slide 13: Indexed investment process – Risk control
Indexed investment process – Risk control Central to SINOPIA’s neutral risk approach to indexation ` Daily performance attribution – Fund manager – Daily performance attribution reports ` Daily control of trade implementation – Trading team & fund manager – Internal trade reporting system – Daily ch
Slide 14: Portfolio characteristics
Portfolio characteristics Sector weights 20.94% Regional weights 14.89% 10.63% 20.45% 5.42% 9.05% 6.02% 1.76% 5.04% 5.72% 8.9% 5.57% 63.05% 22.59% Basic Materials (5.04%) Consumer Goods (8.9%) North America (63.05%) Europe ex UK (14.89%) Consumer Services (5.57%) Health Care (22.59%) UK (10.63%) Jap
Slide 15: HSBC Amanah Global Equity Index Fund Performance
HSBC Amanah Global Equity Index Fund Performance 0.00 -5.00 -10.00 -15.00 -20.00 -25.00 -23.91 -23.28 -30.00 -31.80 -31.64 -35.00 -34.76 -34.68 -37.33 -37.27 -40.00 6 Months 12 Months 2 years 3 years Fund Index Performance explained by: Withholding Tax -0.35 Withholding Tax -0.66 Withholding Tax -1.
Slide 16: HSBC Amanah Global Equity Index Fund Fund terms
HSBC Amanah Global Equity Index Fund Fund terms Legal structure Sub-Fund of Luxembourg-based “HSBC Amanah Funds” SICAV Investment company HSBC Investment Funds (Luxembourg) SA Investment advisor SINOPIA Asset Management Liquidity Dealing daily by 9:00am (CET) Domicile Luxembourg A Share (available t
Slide 17: Active Quant Strategies
Active Quant Strategies Active equity management to outperform different Islamic equity universes ` Objective is to deliver outperformance over the long term, using four performance drivers: – Equity exposure management – Country allocation – Sector allocation – Stock selection ` Average tracking-er
Slide 18: Investment process: Overview
Investment process: Overview Four sources of alpha Health Health Oil Oil & & Global Global US US EZ EZ HK HK …/… …/… Tech Tech …/… …/… Islamic Islamic index index care care Gas Gas Investable Investable universe: universe: SINOPIA SINOPIA quantitative quantitative equity equity valuation valuation m
Slide 19: Investment process - Valuation
Investment process - Valuation Valuation model Short Short term term Macro Macro economic economic interest Earnings Earnings growth growth interest rates rates variables variables Current Current Market Market Market Market Market Market data data Inputs Inputs I/B/E/S I/B/E/S data data based based
Slide 20: Investment process: Allocation
Investment process: Allocation Active risk management Equity exposure Optimisation: Country exposure Expected country & returns sector correlation Sector exposure Individual stock exposure Non contractual document 20
Slide 21: Investment process: Implementation
Investment process: Implementation Controlling trading costs is crucial ` Review with trading desk to determine best trading strategy (ex. basket trading) to limit implicit costs and turnover: – Search for lowest brokerage fees per basket – Quantify and anticipate market impact – Rely on proprietary
Slide 22: Risk management and monitoring
Risk management and monitoring An integral part of the investment process ` Performance verification and performance attribution – Daily controls of main exposure to risk and performance factors – Daily performance attributions performed by the assistant fund managers – Weekly review of our valuatio
Slide 23: HSBC Amanah Global Equity Fund
HSBC Amanah Global Equity Fund Country/sector allocation as of end of February 2009 Top 10 countries Sectors Country Portfolio weight DJIM weight Active position Sector Portfolio weight DJIM weight Active position United states 55.81% 54.37% 1.44% Health Care 20.54% 19.20% 1.34% United Kingdom 9.88%
Slide 24: HSBC Amanah Global Equity Fund performance attribution
HSBC Amanah Global Equity Fund Performance attribution from 30 November 2007 (inception date) to 27 February 2009 Return Return in in USD* USD* Fund Fund -49.69% -49.69% DJIM DJIM index index -47.37% -47.37% Alpha Alpha -2.32% -2.32% Exposure Exposure management management 0.86% 0.86% Country/sector
Slide 25: HSBC Amanah Global Equity Fund Fund terms
HSBC Amanah Global Equity Fund Fund terms Legal structure Sub-Fund of Luxembourg-based “HSBC Amanah Funds” SICAV Investment company HSBC Investment Funds (Luxembourg) SA Investment advisor SINOPIA Asset Management Liquidity Daily (orders taken up to 9:00 am CET) Dealing currencies USD, GBP, EUR, CHF
Slide 26: HSBC Amanah Europe Equity Fund
HSBC Amanah Europe Equity Fund Country/sector allocation as of end of February 2009 Top 10 countries Sectors Country Portfolio weight DJIM weight Active position Sector Portfolio weight DJIM weight Active position United Kingdom 33.99% 34.11% -0.12% Health Care 25.29% 24.44% 0.84% France 16.48% 16.3
Slide 27: HSBC Amanah Europe Equity Fund Fund terms
HSBC Amanah Europe Equity Fund Fund terms Legal structure Sub-Fund of Luxembourg-based “HSBC Amanah Funds” SICAV Investment company HSBC Investment Funds (Luxembourg) SA Investment advisor SINOPIA Asset Management Liquidity Daily (orders taken up to 9:00am CET) Dealing currencies USD* A Share (avail
Slide 28: HSBC Amanah Asia Pacific ex Japan Equity Fund
HSBC Amanah Asia Pacific ex Japan Equity Fund Country/sector allocation as of end – February 2009 Top 10 countries Sectors Country Portfolio weight DJIM weight Active position Portfolio Sector DJIM weight Active position weight Australia 21.11% 20.93% 0.18% Information Technology 19.50% 18.76% 0.75%
Slide 29: HSBC Amanah Asia Pacific ex Japan Equity Fund Fund terms
HSBC Amanah Asia Pacific ex Japan Equity Fund Fund terms Legal structure Sub-Fund of Luxembourg-based “HSBC Amanah Funds” SICAV Investment company HSBC Investment Funds (Luxembourg) SA Investment advisor SINOPIA Asset Management (Asia Pacific) Limited Liquidity Daily (orders taken up to 1:00pm CET)
Slide 30: SINOPIA's Equity Management Key strengths
SINOPIA 's Equity Management Key strengths ` SINOPIA has over 15 years experience in managing global equities with USD 10bn AUM as of end December 2008* ` Unique and robust Active Quantitative process: – research-driven (based on fundamental data) – structured, disciplined and replicable – sophistic
Slide 31: Appendix
HSBC & AMANAH Islamic Finance for Appendix
Slide 32: Central Shariah Committee members
Compliance with Shariah Central Shariah Committee members Sheikh Nizam Yaquby He is a Graduate in Economics and Comparative Religion from Mc Gill University and is an internationally acclaimed scholar in the Islamic banking industry. He has been a teacher of Tafsir since 1976. He advises a number of
Slide 33: Purification costs
Purification costs ` The Fund receives company dividends generated as part of a company’s normal business operations. However, any proportion of income received from non-compliant activities are paid to HSBC in the Community foundation and thereby ‘purified’ ` Dividend purification cost ratio. This
Slide 34: SINOPIA's Equity Management Team
SINOPIA 's Equity Management Team Jean-François Schmitt (8/15) Jean-François Schmitt (8/15) Global Global Head Head of of Equity Equity –– SINOPIA SINOPIA Asset Asset Management Management Manager 10 10 portfolio portfolio managers managers Manager of of the HSBC the HSBC Amanah `` Paris Paris Amana
Slide 35: Disclaimer
Disclaimer This document is intended for investment professionals only and should not be distributed to retail clients. HSBC Amanah Funds SICAV is a Luxembourg domiciled SICAV and is regulated by the CSSF. HSBC Amanah Funds SICAV cannot be sold by anyone in any jurisdiction in which such offer or so
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