Chimera Capital’s ETF hits Dh100m in AUM

Chimera Capital, an Abu-Dhabi-based asset management firm, has announced that its Chimera S&P UAE Shariah Exchange Traded Fund (ETF) surpassed Dh100 million in assets under management (AUM) in July 2021.

This achievement, which came just before the ETF’s one-year anniversary, demonstrates the growing interest from investors seeking to capitalise on the UAE economy’s strong prospects, said Syed Basar Shueb, chairman of Chimera Capital, which currently manages four out of 10 equity ETFs listed in the Mena region.

“The rapid growth is testament to the increasing investor appetite for innovative investment tools such as ETFs, and it is also a reflection of the product’s robust and highly regulated structure,” Shueb said in a statement.

Sherif Salem, chief investment officer – Public Markets at Chimera Capital, said although the Gulf’s ETF landscape is at a nascent stage, th firm is highly optimistic about its growth potential in the region. “At Chimera Capital we provide retail as well as institutional investors with simple, cost-effective and efficient investment tools and we are confident that the ETF market is poised for further growth.”

The Chimera S&P UAE Shariah ETF, which tracks the S&P UAE Domestic Shariah Liquid 35/20 Capped Index (Bloomberg: SPSHDAAN), had listed on the Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM) back in July 2020 with AUM of Dh2 million. The fund, which recorded strong investor demand from the very start, had surpassed the Dh50 million AUM mark in just six months from its launch, and today stands as the Mena region’s third-largest equity ETF.

Investors have benefited from the ETF’s performance in its first year, with Net Asset Value (NAV) increasing by over 47.3 per cent as of the end of July 2021. This is in line with the index’s return of 49.3 per cent over the same time period (a tracking error of 1.0 per cent plus a total expense ratio 1.0 per cent).

The DFM-listed CHAESHIN distributed a dividend of Dh0.108 per share on June 23, implying a dividend yield of 2.0 per cent based on the pre-dividend price of Dh5.39 recorded on June 22, 2021. The fund intends to pay a dividend twice a year, in June and December, when available.

Today, ETFs globally hold over $9 trillion in AUM from more than 400 providers. On the other hand, there are 10 equity ETFs in the Mena region with approximately $330 million in AUM. Having seen traction and AUM growth, Chimera Capital launched a new sub-fund, the Chimera S&P UAE UCITS ETF, in February 2021.

Listed on both the ADX and DFM, Chimera Capital’s newest ETFs track the S&P UAE BMI Liquid 20/35 Capped Index (Bloomberg: SPUAECAN).

— issacjohn@khaleejtimes.com