This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on March 14 - 20, 2016.

PMB Investment Bhd secured three wins at The Edge-Thomson Reuters Lipper Fund Awards 2016. The PMB Shariah Aggressive fund won in the three- and five-year categories for Equity Malaysia Islamic Funds and in the three-year category for Equity Malaysia Funds.

CEO Ameer Ali Mohamed credited his team and the company’s bottom-up investing strategy for the performance of the fund. Among the challenges faced by the PMB team was volatility in the global equity and commodity markets, which affected Malaysian equities. 

“Our stock universe is made up of the top 300 shariah-compliant companies listed on Bursa Malaysia, and the strategic review of securities selection and allocation is made on a quarterly basis,” he says.

Ameer describes the performance of the financial markets last year as uncertain, volatile and challenging. However, there was no drastic portfolio rebalancing. In 2015, the average equity allocation for the fund at month-end was 85%. The fund’s strategic equity allocation is usually between 80% and 99.5% equities.

“As this fund is targeted at investors with a high risk tolerance and medium- to long-term investment horizon, we adopted a fully invested or nearly fully invested strategy throughout the period. What was important was the quarterly rebalancing exercise,” says Ameer.

Despite the volatile markets and reasonable amount of redemptions by investors, the PMB Shariah Aggressive fund still managed to register 148% growth to RM44.6 million from RM18 million previously. Assets under management rose 8% to RM1.18 billion from RM1.09 billion at end-2014. 

“We hope that the performance of our funds last year (two finished in the top 3 of the three- and  five-year categories while five were in the top 10 of the one-year category), as well as these awards that we received will help increase our assets under management,” says Ameer. 

PMB expects the market uncertainty to continue this year. This means that stock picking and finding medium- to long-term value will be key to navigating the challenging market conditions.

“We manage risk through our securities selection process at least on a quarterly basis and monitor the fund on a daily basis,” says Ameer.

He adds that crude oil prices have oscillated in the last 20 years, so the price drop was to be expected. However, Ameer expects things to turn around soon. This will strengthen the ringgit and improve the performance of equities.

“With the current developments, it is only a matter of time before crude oil prices recover. Any significant change in crude oil prices and the ringgit will definitely have an impact on most of the listed companies. We will restrategise based on the latest variables.”