Islamic Fund Management
109
Figure 4.12: Process Flow of Fund Development in Pakistan
Source: Al Meezan Investment
As at end-2017, there are 11 categories of Islamic funds offered in Pakistan―as approved by
the SECP. Investment in these funds is driven by individual investment objectives and risk
appetites highlights some key investment strategies, authorised asset allocation or
investment avenue, and product suitability that AMCs in Pakistan consider when
recommending a certain type of Shariah-compliant fund.
Table 4.14: Investment Strategies of Different Types of Islamic Funds in Pakistan
Type of
Fund
Investment
Strategy
Asset Allocation/ Authorised Investment Product Suitability
Shariah-
Compliant
Equity Fund
To provide
potential for high
growth and
returns with a
relatively high
level of risk.
Asset allocation Min Max
Shariah-compliant listed
securities
70% 100%
Islamic bank deposits
(excluding term-deposit
receipts (TDRs))
0% 30%
Investors who seek:
 High risks with high
returns on their
investments.
 Long-term wealth
creation.
 A diversified equity
fund that aims for
capital appreciation.
Shariah-
Compliant
Index
Tracker
Fund
To provide
returns that are
in line with the
performance of
benchmark
indices such as
the KMI-30.
Strive to invest 100% according to the stated
index. Otherwise, the fund should invest in:
Asset allocation Max
Shariah-compliant securities
covered by the index
85%
Cash in Islamic banks/Islamic
banking windows (excluding TDRs)
15%
Investors who seek:
 High risk with high
returns on their
investments.
 Cost-efficient way to
invest in specific
benchmark indices.
 A passive investment