Daman UAE Fund posts 42pc pay-out ratio

DUBAI - Daman UAE Value Fund, a closed-ended, offshore mutual fund, yesterday reported a total dividend payment of Dh15.5 per share representing a yield of 7.3 per cent in its first 21 months of operation.



By A Staff Reporter

Published: Wed 16 Apr 2003, 12:26 PM

Last updated: Wed 1 Apr 2015, 7:41 PM

Outlining the performance of the fund that was launched on July 1, 2001 with shares valued at a par value of Dh100, Shehab M. Gargash, director, said it has distributed 42 per cent of gains so far achieved as dividends. "The total dividend payment over that period is Dh15.50 per share, which represents a yield of 7.3 per cent based on the current NAV price of Dh121.39 per share. The UAE market average yield is 3.57 per cent as of April 13, 2003," he said.

"The fund's generous distribution policy reflects our firm belief that investors should receive the profits from their investment in hand through dividend payments," Gargash said. "We feel that dividend payments are important for both our fund and for UAE publicly listed companies in general, in order to create more dynamic capital markets where money flows more freely."

During the first quarter this year, the fund grew by 1.39 per cent, compared to growth of 0.56 per cent in the benchmark National Bank of Abu Dhabi (NBAD) Index. During March 2003, it grew 0.81 per cent.

"The fund's ability to grow during months when the UAE market loses ground has been one of the most important contributors to its consistent positive track record since its launch," Gargash said. "

In 21 months of activity, the fund has posted only one monthly decline, while the NBAD Index has posted seven monthly declines during the same period. The fund was the only UAE-focused mutual fund to post a gain in March. The NBAD Index declined 0.58 per cent during the month, he pointed out.

Gargash also announced that the fund ended its 2002-2003 financial year on March 31, posting growth of 6.54 per cent during the financial year. Since inception, its annualised performance is 21.08 per cent, which exceeds the goal of 10-15 per cent annual returns over its life. The fund's Annual General Meeting is expected to be held next month.

Mustafa Farid, senior investment manager, said despite great uncertainty in the market due to the war on Iraq and other factors, his forecast that the market would reach the 3,550 level was accurate. The NBAD Index stood at 3,562.81 as of April 13.

Farid expects the market to continue trading at 3,500-3,600 through the 2nd and 3rd quarters. He said that investors should be extremely selective, as the market is overheated and speculative trading by large investors will pose a risk for smaller investors. By the 4th quarter, Farid expects the market to rally, approaching the 3,800 level.


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