Mashreq Capital adopts Bloomberg’s Global Aggregate USD Sukuk Index for fixed-income funds

§ 01 Executive Snapshot

• What: Mashreq Capital adopts Bloomberg's Global Aggregate USD Sukuk Index for its fixed-income funds.
• Who: Mashreq Capital (DIFC) Limited and Bloomberg Index Services Limited.
• Why it matters: This move enhances Mashreq Capital's investment capabilities and aligns with global benchmarks, improving transparency and performance measurement in fixed-income investing.

§ 02 Key Developments

• Mashreq Capital will use Bloomberg Fixed Income Indices as benchmarks for the Mashreq MENA Fixed Income Fund, Mashreq Al Islami Income Fund (Sukuk), and Mashreq Global Emerging Markets Bond Fund.
• The decision reflects Mashreq Capital's commitment to robust benchmarking standards and enhances portfolio management through data-driven insights.
• Bloomberg's Global Aggregate USD Sukuk Index tracks investment-grade, fixed-rate USD-denominated Sukuk bonds across various sectors, ensuring high-quality inclusion through Islamic finance screening criteria.

§ 03 Strategic Context

• The adoption of Bloomberg indices is part of a broader trend in the financial industry towards using transparent and objective benchmarks to improve investment strategies and performance measurement.
• This collaboration signifies a shift towards integrating sophisticated indexing solutions that cater to the unique demands of MENA and emerging markets.

§ 04 Strategic Implications

• The immediate consequence is an enhanced ability for Mashreq Capital to construct and manage portfolios effectively, potentially leading to improved fund performance.
• Long-term, this partnership may position Mashreq Capital as a leader in the fixed-income market within the region by leveraging advanced data analytics and robust benchmarks.

§ 05 Risks & Constraints

• Potential risks include market volatility that could impact fixed-income securities and the reliance on third-party indices for performance measurement.
• There may also be challenges related to the liquidity and accessibility of Sukuk bonds in specific market conditions.

§ 06 Watchlist / Forward Signals

• Future developments to watch include any changes in the performance of the funds benchmarked against the Bloomberg Global Aggregate USD Sukuk Index and the potential expansion of Mashreq Capital's product offerings.
• The success of this initiative may be indicated by increased investor interest and inflows into the funds utilizing these indices.