Navis Al-Bahhar Fund – Shariah-compliant Fund parallel to Navigator
Navis has managed Shariah-compliant parallel private equity funds since November 2001 and public equity funds since November 2007. Al-Bahhar is managed by the Navigator investment team and employs the same investment approach as Navigator with a filter for compliance with Islamic investment principles. The overlap with Navigator is high, about 90%, as Navigator itself does not invest in prohibited industries and seeks companies with low leverage.
The Al-Bahhar's Fund is based on "a private equity approach to investing in public equity", building on Navis' firm wide beliefs. The investment approach is based on extensive bottom-up fundamental research on sectors, companies and their competitive environment, management depth and trustworthiness. Al-Bahhar has a value orientation-seeking companies whose earnings, growth or dividend characteristics are not fully valued by the market and often not widely covered by analysts. The portfolio is therefore conservative, with beta well below 1X.
The Fund's research process is intensive and hands-on and only invests in businesses where the investment team has met and is comfortable with the management. We leverage the substantial and broad investment experience of the Navis team and Investment Committee deliberation is structured to be comprehensive, frequent and intentionally.
The Fund targets roughly 15 investment positions (including cash) at any one time. Country weightings vary but we seek country, industry and currency diversification at all times.
Shariah Advisor: Guidance Investments
Navis' Islamic parallel funds are advised by Navis' longstanding Shariah business partner, Guidance Investments, and supervised by Guidance Investments' internationally recognized Board of scholars. Fund structures, documentation and portfolio company activities comply with Shariah principles, as interpreted by the Supervisory Board. Guidance Investments is part of Guidance Financial Group – an international financial services company dedicated to addressing unmet needs in the Islamic finance market.
Since inception in 2007 the Al-Bahhar Fund (including its predecessor closed ended fund) has increased by 104%, outperforming the MSCI ex-Japan Islamic index which decreased by 11% over the same period (as of 31 December 2016).
Fund Structure and Terms
The Fund has a Cayman Islands domiciled, Master/Feeder structure. There is a Manager's incentive fee subject to high water mark and a minimum performance trigger. The fund is open ended with monthly net asset valuations and subscriptions. Redemptions are quarterly and subject to 60 days' notice, with some prudential limitations. There are no entry or exit fees.