UBL Fund Managers announced the launch of its new investment scheme "UBL Principal Protected Fund - I". The scheme will be open for public subscription from December 2 till December 27, 2011. UBL Principal Protected Fund-I is an open-end Fund of Funds investment scheme that will provide investors with an opportunity to gain up to 100 percent exposure in the stock market while getting 100 percent principal protection.
The scheme is based on a world renowned dynamic asset allocation methodology called the "Constant Proportion Portfolio Insurance" or CPPI for short. According to this methodology, the scheme will dynamically allocate amounts between Equity and Money-Market Mutual Funds on a daily basis. Allocation to Equity Mutual Funds will increase as the stock market rises, while allocation to Money Market Mutual Funds will increase if the stock market declines.
Chief Executive of UBL Fund Managers, Mir Muhammad Ali, CFA spoke about the rationale of launching such an investment scheme, saying that "World over, the stock market is considered to be a time tested means of building wealth in the long term. In Pakistan as well, the stock market has outperformed other forms of investments such as gold and national savings schemes over the past 10 years. However, despite this, the participation of the common man in the stock market remains low. This is largely due to their lack of understanding and knowledge about how the stock market works. Added to this is the fear of losing their money. This new scheme gives the common man an easy and smart way of investing in the stock market. It not only allows them to gain from the expertise and experience of professionals managing their portfolio for them, but also guarantees their peace of mind that their principal will be protected."
UBL Principal Protected Fund - I is a fixed duration scheme having a time period of two years. The scheme will be open for subscription for a limited time period during the IPO after which it will be closed for any further subscriptions. UBL Fund Managers is currently managing investments of over Rs 38 billion on behalf of its investors. The company enjoys a "High Management Quality" Rating of "AM2" assigned by JCR-VIS Credit Rating Company.