KUALA LUMPUR: MCIS Insurance Bhd anticipates a positive recovery in 2024, especially for the local market, supported by improved corporate earnings and a resilient domestic economy.
Chief investment officer Wan Mohd Fakruddin Razi said the company’s investment strategy is planned to account for economic factors influencing performance, with a strong focus on achieving long-term growth and stability.
“MCIS investment’s portfolio is designed to accommodate market volatility, ensuring consistently good value for our clients.
“Given our consistent record of outperforming benchmarks in recent years, we maintain a positive outlook on the market.
“We are confident that the performance of MCIS investment will remain favourable. Our investment focus will target sectors poised to benefit from the economic recovery, aiming to secure positive capital appreciation for our investments,“ he said.
He said sustainable investing, focusing on environmental, social and governance (ESG) factors, remains a key priority.
“In line with our commitment to sustainability, investments in non-ESG compliant assets will not exceed 10% of our total investments,“ Mohd Fakruddin said.
For its financial year, which ended December 31, 2023, MCIS Life Dividend Fund gained 0.44% and outperformed the benchmark by 317 bps, whereas the FBMKLCI Index posted a negative return of 2.73%.
MCIS Life Equity Fund lost 0.35% in 2023. However, the fund outperformed the benchmark on a yearly basis by 238 bps.
Meanwhile, MCIS Life Jati Fund posted a negative return of 0.16% for 2023, underperforming the benchmark FBM EMAS Shariah Index by 62 bps, which posted a gain of 0.46% for the same period.
These three local-based asset funds are managed to outperform the benchmark for the three-year and five-year periods. The outperformance was mainly due to low exposure to underperforming stocks.
MCIS Insurance’s local fixed-income funds, MCIS Life Income Fund and MCIS Life Balanced Fund, overperformed their required benchmark by 147 bps and 87 bps annually, respectively.
Both funds also outperformed the benchmarks for the three-year and five-year periods.
Moving on, the MCIS Life AsiaPac Fund, which invests in the Principal S&P Ethical Asia Pacific Dividend ETF listed in Singapore, recorded a healthy return of 9.95%, outperforming the benchmark return, which recorded a gain of 4.11%.
The outperformance was due to better performance of the portfolio’s underlying asset and cash holdings.
The fund also managed to outperform the benchmark index for three-year and five-year periods by 750 bps and 537 bps, respectively.
Meanwhile, the MCIS Life Global Yakin Fund, a feeder fund that invests in Aberdeen Islamic World Equity Fund, returned 20.96% in double digits, outperforming the benchmark MSCI AC World Islamic Index by 131 bps.
The fund also outperformed the benchmark index for three years by 32 bps.
MCIS Life Titan Fund, which invests in MyETF Dow Jones US Titans 50, registered double-digit growth of 33.31% year-on-year (YoY) as of December 31, 2023.
The fund, however, underperformed the benchmark index, the Dow Jones Islamic Market US Titans 50 Index, which registered a higher positive return of 39.92% in the same period.
For three years, the fund outperformed the benchmark by 177 bps.
In the global economic review, market sentiment should improve with the tail-end of international monetary policy tightening and the presidential election, which historically translates into a positive year for the US market, with an anticipated positive spillover effect on other regional markets.
“For fixed income, Bank Negara Malaysia (BNM) is anticipated to keep its monetary policy unchanged in the first half (1H) of 2024, aiming to balance the economic growth and inflationary pressure in the country.
“External risk factors continue to weigh on the local market, mainly due to the ongoing Russia-Ukraine and the Middle East conflicts. As such, if the opportunity arises, we will keep looking to buy on dips of corporate bonds,“ Mohd Fakruddin said.
Meanwhile, MCIS Life also actively incorporates ESG principles across all its operations.
This commitment is reflected in the company’s proactive stance on sustainability, which shapes its decision-making processes, influences new product development, and steers its overall corporate strategies.
“MCIS Life actively engages in various impactful ESG initiatives, such as reducing our carbon footprint, fostering greener workplaces, supporting community programmes and ensuring transparent governance,“ Mohd Fakruddin said.
“These initiatives aim to create long-term value for the business, the MCIS Life ecosystem, our customers, and the wider community.
“Moving forward, we are continuously adapting our ESG commitments to meet emerging challenges and changing landscapes, reinforcing the synergy between protection and sustainability as core strategy components,“ he said.
