SICO Top-20, the equally-weighted diversified GCC equities portfolio of Bahrain-based SICO, has generated a cumulative return of 152 per cent since its launch in November 2017.
The regional asset manager, broker, market maker and investment bank said the portfolio has consistently outperformed its benchmark, the S&P GCC Index, which on a comparative basis delivered cumulative returns of 85pc over the past five years.
A product of SICO’s sell-side research division, the ‘top-20’ portfolio encompasses a diversified range of stocks across GCC, which have been managed by the research team, backed by fundamental research and timely calls.
SICO head of research Nishit Lakhotia commented, “We are very pleased with our top-20’s performance, which provides our clients with superior and consistent returns, without excessive churn.
Our portfolio is carefully selected after extensive analysis by our research team to ensure a perfect blend of names based on market fundamentals and stock valuations. Reviewed at the beginning of each month, the portfolio is continuously monitored against major events both at macro and company specific level.”
SICO research covers more than 80 companies across 12 key regional sectors to date.
With a long-standing direct presence for over two decades in the Gulf region, the division provides coverage of equities across the six GCC countries, in addition to discussing critical macro themes affecting the region.
“Making informed decisions becomes increasingly challenging during times of uncertainty, as we continue to experience rising rates, geopolitical tensions, supply chain disruptions, and volatility regarding commodities, including oil.
Our goal is to navigate these market distortions to build a portfolio that can generate reasonably strong returns for our clients over the long-term. More than 50pc of the total 67pc alpha generated by our top-20 portfolio was achieved post the initial onset of the Covid-19 pandemic, thereby demonstrating its ability to outperform during volatile times,” Mr Lakhotia added.
Investing in equities within GCC markets remains an attractive proposition, as they remain broadly more resilient than global peers, despite volatility in oil prices and aggressive Fed tightening.
Fiscal surplus, relatively lower inflationary pressure, and expected government stimulus to push spending continue to support multiple investment themes despite volatilities in commodities and global geopolitical issues.
Furthermore, robust IPO markets imply more diversity and investment innovation within the GCC equities space.
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