The bank launched HSBC Saudi Equity Index as a way to benchmark the returns generated by the Saudi equity market. And it has kicked off a tailored sector index, based on Saudi Petrochemical stocks, called the HSBC Saudi Petrochemical Equity Index. Both indices will be reviewed quarterly.
The Saudi Index is comprised of 36 liquid stocks representative of the market capitalisation of the broad range of economic sectors in Saudi. The composite companies reflect the breadth and diversity found in the Saudi stock market, from banks to bookstores, from petrochemicals to publishing.
Created to provide clients with a potentially high-growth sector benchmark, the Petrochemical Index offers exposure via a portfolio of 11 shares with weightings representative of their market capitalisation in this sector.
Complementing these indices, HSBC Saudi Arabia has also launched two new open-ended funds: the HSBC Saudi Equity Index Fund and the HSBC Saudi Petrochemical Equity Opportunities Fund. Both passively managed funds are aimed at institutional investors and third-party distributors and represent one practical way for offshore investors to gain exposure to the Saudi equity market, which is currently closed to direct investment by non-domiciled investors.
ôThis is an extremely exciting development for us and adds significantly to our existing offering of Saudi funds, which have seen strong growth and increasing interest in the last three months,ö says Osama M Shaker, head of asset management in Saudi.
Additionally, HSBC CIBM is offering market access through participatory notes and swaps over these funds as another way to gain exposure to the Saudi market, particularly for those institutional investors who want to achieve exposure without the inconvenience and time delay which can be experienced in setting up locally or who are looking for gearing, leverage and funding.
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