AL-Rajhi Petrochemical Fund

Al Rajhi Petrochemicals Fund is a specialized sector equity fund that provides investors with direct exposure to the Saudi petrochemical sector. It is an open-ended public equity fund that follows an active management strategy aimed at maximizing capital growth by selecting companies with strong financial fundamentals and promising investment opportunities.

The fund offers flexibility in allocating a portion of its assets to other investment instruments and managing liquidity, while maintaining a minimum allocation of 50% in shares of petrochemical companies listed on the Saudi Stock Exchange (Tadawul). This makes it a suitable choice for investors seeking long-term investment opportunities in one of the most influential sectors of the Saudi economy.

The Al Rajhi Petrochemicals Fund is classified as a high-risk fund and is designed for investors seeking capital appreciation who are willing to accept the higher volatility associated with concentrated investment in a single sector.

The fund follows a flexible asset allocation policy centered primarily on the Saudi petrochemical sector, allocating between 50% and 100% of its net assets to shares of petrochemical companies listed on the Saudi stock market. It may also invest up to 30% of its assets in companies from other sectors, up to 50% in public investment funds (both listed and unlisted), maintain up to 40% in cash, money market transactions, and money market funds for liquidity management, and invest up to 10% in privately offered investment funds with similar objectives and strategies.

Under exceptional circumstances, the fund manager may increase the allocation to cash or money market instruments to more than 40% of the fund's net assets to ensure efficient liquidity management and protect investors' interests.

In addition to its focus on the petrochemical sector, the fund may invest in Gulf, Arab, and international markets that are regulated by comparable supervisory authorities, with a maximum allocation of 40% of its net assets. The fund manager may also lend the fund's assets up to 30% of the net asset value, obtain Sharia-compliant financing of up to 15% of the fund's net assets, and temporarily exceed this limit if necessary to meet redemption requests.

The fund may also use financial derivatives for hedging and efficient portfolio management purposes, with exposure limited to 15% of its net assets. Investments in money market instruments are made with counterparties having a minimum credit rating of BBB-, Baa3, or an equivalent rating. Investments with lower-rated or unrated counterparties are permitted up to 30% of the fund's net assets, subject to the fund manager's internal credit assessment. The fund manager does not intend to pledge any of the fund's assets.