Al Rajhi Mid/Small Cap Fund

Al Rajhi Mid & Small Cap Fund is an open-ended equity fund, actively managed and compliant with Shariah principles. The fund aims to achieve capital growth by investing primarily in shares of mid- and small-cap companies listed on the Saudi Stock Exchange. It does not distribute cash dividends; instead, it reinvests realized profits to enhance the growth of the fund's asset value over the long term.

The fund's investment strategy is based on the belief that mid- and small-cap companies generally offer higher growth potential than large-cap companies, particularly during expansion phases, providing opportunities for attractive long-term capital appreciation. Accordingly, the fund manager focuses on selecting companies with strong competitive advantages and solid financial and operational indicators that demonstrate sustainable growth potential.

The fund allocates between 50% and 100% of its assets to investments in mid- and small-cap companies. It may also invest up to 50% of its assets in exchange-traded funds (ETFs) and real estate investment traded funds (REITs), while retaining up to 40% in money market instruments and cash management investments to manage liquidity when needed. In addition, the fund manager may invest up to 30% of the fund's assets in other listed Saudi companies, up to 10% in similar investment funds, and up to 40% in Gulf and international markets when suitable investment opportunities are available.

The fund is classified as a high-risk investment fund due to its focus on mid- and small-cap companies, which offer higher growth potential but may experience greater price volatility and lower liquidity compared to large-cap companies.