Asset management firm, Norrenberger will on Tuesday list by introduction its Islamic Fund (NIF) and the Norrenberger Turbo Fund on the Nigerian Exchange Limited (NGX).
Both funds are collective investment schemes (CIS) registered by the Securities and Exchange Commission (SEC). The NIF is designed for investors with a short—to long-term investment horizon who prioritize adherence to Shariah principles. Norrenberger notes that the fund targets investors seeking returns above conventional Shariah-compliant fixed deposits while maintaining a conservative approach, avoiding the higher risks linked to equity investments.
The NIF was launched in May 2021 and is based on fixed-income assets, with about 75 percent of the fund invested in Sukuk bonds. The fund has a minimum initial investment of 50 units with additional investments of 10 units. As of July 2024, NIF had a fund size of N1.04 billion.
The fund is benchmarked against the 3-year FGN Bond. A review of the fund’s fact sheet shows that 19 percent of the fund is invested in Mudarabah, 4 percent is invested in Ijarah, with 2 percent as cash assets. The remaining assets are allocated to Murabaha.
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Mudarabah is an Islamic finance term that depicts an investing model in which the investor entrusts funds to managers who use their skills to generate returns while adhering to the Islamic principle of non-interest and speculative activities.
Ijarah is an Islamic finance term that basically describes leasing, where the lessor allows the lessee use an asset in exchange for agreed-upon rental payments. Murabaha is another Islamic finance term that describes a model where a buyer and seller agree on the cost and profit margin for the sale of an asset. Essentially, the buyer and the seller are supposed to agree on the markup on the item, in a bid to provide transparency.
The Norrenberger Turbo Fund (NTF) introduced in November 2023, is a mutual fund focused on fixed income assets such as bonds. About 86.3 percent of the fund was invested in fixed income securities, with 13.3 percent invested in money market instruments. The remaining 0.45 percent was held as cash.
As of September 2023, the fund had a size of N1.68 billion with a minimum investment amount of N5000 and N1000 additional investment amounts. Like the NIF, the NTF is benchmarked against the 3-year FGN Bond.
As of September, NTF had a year-to-date yield of 13.66 percent, underperforming its benchmark by 5.35 percent. With the listing of these funds on the NGX, the number of mutual fund securities listed on the NGX will hit 22.
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