Regulatory Guide 1.177, Revision 1, "An Approach for Plant - NRC
bank muscat Money Market Fundbankmuscat.com/assetmanagement/pdf/MMF_factsheet.pdf · 81% Less than...
1
Objective Deposit Profile Geographical Allocation Fund Manager’s Commentary 81% Less than 3 months 19% More than 3 months 37% GCC The Fund seeks to generate maximum returns with the preservation of capital and daily liquidity as its main objectives The broad money (M2) in Oman expanded by 15.7% yoy and M1 grew sharply by 23.7% yoy as per the latest CBO’s monthly report in November 2014. This indicates abundant liquidity in Oman. The key drivers for M1 expansion were the increase in demand deposit by 27.1% as well as increase in currency with the public by 14.4%. The Certificate of Deposits issued by CBO to manage liquidity was at 0.130% which is the same level seen in October last year. The interbank rate softened to 0.127% from 0.133% a year ago. As per the CBO report, the weighted average interest rate on RO deposits of all commercial banks in Oman declined to 1.006% from 1.177% a year ago. Similarly, the weighted average lending rate for RO loans decreased from 5.430% to 5.118% during the same period. The fall in oil prices may impact the liquidity and this could result in increase in short term interest rates. *Latest available data 63% Oman Fund Performance Fund 1 month 3 months 6 months Since Inception bm MMF 0.97% 0.94% 0.95% 1.163% Annualized Fund Manager Currency Structure Geographic Focus Minimum Investment Weighted Average Maturity Days Management fees bank muscat SAOG Omani Riyal Open Ended fund registered GCC Region; predominantly in Oman RO250,000 Number of Holdings 15 56 days 0.20% per annum Admin. & Registar Fees Subscription/Redemption Time 0.07% per annum Daily before 10:00 am Fund’s Highlights Currency Profile 63% OMR 37% Others The U.S Federal Reserve decided in its January meeting to leave the interest rates unchanged at a range of zero to a quarter of a percentage point, postponing a return to what it calls normal rates and reiterating that “it can be patient” in deciding when to begin raising rates. The Federal Reserve’s open market committee added that once it begins to raise rates, which most analysts expect will take place around the middle of the year, “economic conditions may, for some time” result in interest rates “below levels the Committee views as normal in the longer run.” Many analysts believe that Europe’s economic weakness and the European Central Bank’s new program of buying assets would complicate the Federal Reserve’s decision about raising rates without undercutting policy efforts across the Atlantic. The ten year treasury rate yield slid to 1.68% by the end of January 2015 after it was hovering around 2.17% in December 2014. The U.S economy, as measured by the gross domestic product, grew at a 2.6% annual rate in the October-December period. That was down from a sizzling 5 percent gain in the previous quarter. In the October-December period, consumer spending — which accounts for roughly 70% of the economy - grew at a 4.3 percent rate, up from 3.2 percent in the third quarter. It was the best gain for consumer spending since the first three months of 2006. Last year, the White House projected unemployment would average 6.9% in 2014. Instead unemployment averaged 6.2%, and ended the year at 5.6%. After months of debate and against a backdrop of worsening deflation, European Central Bank (ECB) policy makers decided to embark on sovereign quantitative easing (QE), including purchases of government bonds. The programme of EUR 60bn/month of purchases over at least 18 months is at the top end of market expectations, though in line with what we have previously said is needed to have a meaningful impact on inflation. Asset purchases will continue until the ECB sees inflation on track to meet its medium-term target of close to but lower than 2%. Euro area annual inflation is expected to be -0.6% in January 2015, down from -0.2% in December 2014, according to a flash estimate from Eurostat, the statistical office of the European Union. The short term interest rates in GCC remained compressed on the back of an abundant liquidity. The bank muscat Money Market Fund has generated an annualized return of 1.163% p.a. since its inception on June 23rd, 2012. The fund has managed to consistently maintain returns of almost 1% p.a. with daily liqudiity in a very low interest rate scenario in which the banks are offering rates of 0.6% p.a. for one year deposit. The Fund managed to acheive this better than average returns due to a consistent approach in placing and a careful maturities management. The Fund acitively seeks opportunities for placing investments and the weighted average maturity of the fund which currently stands at 66 days is modified to as required to generate higher returns at the same time maintaining the liquidity in the fund. The Fund has continued to hold its overweight exposure to Oman which currently accounts for 63% of the net assets.The Fund continued to diversify its exposure and also to enhance the returns. As of January 31st,the Fund has no exposure outside of GCC as a defense strategy against volatility in the current interest rate environment. For further information, please contact: bank muscat Asset Management P.O. Box 134, PC 112, Ruwi, Sultanate of Oman. Tel: +968 24768620/7983 E-mail: [email protected], Website: www.bankmuscat.com/assetmanagement Please refer to the relevant section on risk factors in the Fund's prospectus. Authorised and regulated by the Capital Market Authorised, Sultanate of Oman, this fact sheet is provided for information purposes only. The report is based on information generally available and is deemed reliable but no assurance is given as to its accuracy or completeness. bank muscat (SAOG) is not accountable for any decision based on the contents of this report. Neither the information nor the opinions contained are to be construed as an offer to buy and sell the fund mentioned above. It is important to remember that the NAV of mutual fund and the income from them, can go down as well as up and is not guaranteed, and that you the investor may not get back the amount originally invested. Changes in rates of currency exchange, particularly where overseas securities are held, may also affect the value of your investment. All applications are made on the basis of the current Oryx 2004 Fund Prospectus and most recent annual and semi-annual reports, which can be obtained upon request free of charge from bank muscat Asset Management, Sultanate of Oman. NAV: OMR 1.03028 January 2015 bank muscat Money Market Fund CBO 28 Days CD Rate 1M Libor 1M US T Bills 1M EIBOR (UAE) 1M SAIBOR (Saudi Arabia) 1M QIBOR (Qatar) Overnight Inter Bank Lending Rate in Oman Dec. 2014 0.127%* 0.17125% 0.0100% 0.39429% 0.60125% 0.9000% 0.123%* Jan. 2015 0.127* 0.17125% 0.0125% 0.38143% 0.59750% 0.89666% 0.133%*
Transcript of bank muscat Money Market Fundbankmuscat.com/assetmanagement/pdf/MMF_factsheet.pdf · 81% Less than...
Objective
Deposit Pro�le
Geographical Allocation
Fund Manager’s Commentary
81% Less than 3 months 19% More than 3 months
37% GCC
The Fund seeks to generate maximum returns with the preservation of capital and daily liquidity as its main objectives
The broad money (M2) in Oman expanded by 15.7% yoy and M1 grew sharply by 23.7% yoy as per the latest CBO’s monthly report in November 2014. This indicates abundant liquidity in Oman. The key drivers for M1 expansion were the increase in demand deposit by 27.1% as well as increase in currency with the public by 14.4%.
The Certificate of Deposits issued by CBO to manage liquidity was at 0.130% which is the same level seen in October last year. The interbank rate softened to 0.127% from 0.133% a year ago. As per the CBO report, the weighted average interest rate on RO deposits of all commercial banks in Oman declined to 1.006% from 1.177% a year ago. Similarly, the weighted average lending rate for RO loans decreased from 5.430% to 5.118% during the same period.
The fall in oil prices may impact the liquidity and this could result in increase in short term interest rates.
*Latest available data
63% Oman
Fund Performance
Fund 1 month 3 months 6 months Since Inception bm MMF 0.97% 0.94% 0.95% 1.163%
Annualized
Fund Manager
Currency
Structure
Geographic Focus
Minimum Investment
Weighted Average Maturity Days
Management fees
bank muscat SAOG
Omani Riyal
Open Ended fund registered
GCC Region; predominantly in Oman
RO250,000
Number of Holdings 15
56 days
0.20% per annum
Admin. & Registar Fees
Subscription/Redemption Time
0.07% per annum
Daily before 10:00 am
Fund’s Highlights
Currency Pro�le
63% OMR 37% Others
The U.S Federal Reserve decided in its January meeting to leave the interest rates unchanged at a range of zero to a quarter of a percentage point, postponing a return to what it calls normal rates and reiterating that “it can be patient” in deciding when to begin raising rates. The Federal Reserve’s open market committee added that once it begins to raise rates, which most analysts expect will take place around the middle of the year, “economic conditions may, for some time” result in interest rates “below levels the Committee views as normal in the longer run.” Many analysts believe that Europe’s economic weakness and the European Central Bank’s new program of buying assets would complicate the Federal Reserve’s decision about raising rates without undercutting policy efforts across the Atlantic. The ten year treasury rate yield slid to 1.68% by the end of January 2015 after it was hovering around 2.17% in December 2014.
The U.S economy, as measured by the gross domestic product, grew at a 2.6% annual rate in the October-December period. That was down from a sizzling 5 percent gain in the previous quarter. In the October-December period, consumer spending — which accounts for roughly 70% of the economy - grew at a 4.3 percent rate, up from 3.2 percent in the third quarter. It was the best gain for consumer spending since the first three months of 2006. Last year, the White House projected unemployment would average 6.9% in 2014. Instead unemployment averaged 6.2%, and ended the year at 5.6%.After months of debate and against a backdrop of worsening deflation, European Central Bank (ECB) policy makers decided to embark on sovereign quantitative easing (QE), including purchases of government bonds. The programme of EUR 60bn/month of purchases over at least 18 months is at the top end of market expectations, though in line with what we have previously said is needed to have a meaningful impact on inflation. Asset purchases will continue until the ECB sees inflation on track to meet its medium-term target of close to but lower than 2%. Euro area annual inflation is expected to be -0.6% in January 2015, down from -0.2% in December 2014, according to a flash estimate from Eurostat, the statistical office of the European Union.
The short term interest rates in GCC remained compressed on the back of an abundant liquidity. The bank muscat Money Market Fund has generated an annualized return of 1.163% p.a. since its inception on June 23rd, 2012. The fund has managed to consistently maintain returns of almost 1% p.a. with daily liqudiity in a very low interest rate scenario in which the banks are offering rates of 0.6% p.a. for one year deposit.
The Fund managed to acheive this better than average returns due to a consistent approach in placing and a careful maturities management. The Fund acitively seeks opportunities for placing investments and the weighted average maturity of the fund which currently stands at 66 days is modified to as required to generate higher returns at the same time maintaining the liquidity in the fund.The Fund has continued to hold its overweight exposure to Oman which currently accounts for 63% of the net assets.The Fund continued to diversify its exposure and also to enhance the returns. As of January 31st,the Fund has no exposure outside of GCC as a defense strategy against volatility in the current interest rate environment.
For further information, please contact:bank muscat Asset ManagementP.O. Box 134, PC 112, Ruwi, Sultanate of Oman.Tel: +968 24768620/7983E-mail: [email protected], Website: www.bankmuscat.com/assetmanagementPlease refer to the relevant section on risk factors in the Fund's prospectus. Authorised and regulated by the Capital Market Authorised, Sultanate of Oman, this fact sheet is provided for information purposes only. The report is based on information generally available and is deemed reliable but no assurance is given as to its accuracy or completeness. bank muscat (SAOG) is not accountable for any decision based on the contents of this report. Neither the information nor the opinions contained are to be construed as an offer to buy and sell the fund mentioned above. It is important to remember that the NAV of mutual fund and the income from them, can go down as well as up and is not guaranteed, and that you the investor may not get back the amount originally invested. Changes in rates of currency exchange, particularly where overseas securities are held, may also affect the value of your investment. All applications are made on the basis of the current Oryx 2004 Fund Prospectus and most recent annual and semi-annual reports, which can be obtained upon request free of charge from bank muscat Asset Management, Sultanate of Oman.
NAV: OMR 1.03028 January 2015
bank muscat Money Market Fund
CBO 28 Days CD Rate
1M Libor
1M US T Bills
1M EIBOR (UAE)
1M SAIBOR (Saudi Arabia)
1M QIBOR (Qatar)
Overnight Inter Bank Lending Rate in Oman
Dec. 2014
0.127%*
0.17125%
0.0100%
0.39429%
0.60125%
0.9000%
0.123%*
Jan. 2015 0.127*
0.17125% 0.0125%
0.38143% 0.59750% 0.89666% 0.133%*
