There are 43 Asset Management Companies in India, which offer more than 2, 000 mutual fund schemes and manage assets (AUM) worth of above Rs.25 lakh. Mutual Funds in India have been growing at more than 10% annually. Yet the need of country’s second-largest faith- believers of Islam with a population of 172 million are not being addressed nor are efforts made to include them in the financial system. Thus SenSage combines all asset management solutions with a full range of transactional services from bands, equity, mutual funds, and exchange-traded funds and especially a platform for the Islamic investors where they can invest through Sariah- Compliant Investments.
The company knows what Islamic investors want to invest and where through them. This is the reason they recommend Islamic Mutual Funds, equities, Nifty Sariah EFT, and Gold EFT to reach real-world goals. Now, within the mutual fund industry, investors have the choice of two equity-oriented schemes and one gold scheme. Despite the Covid crisis, the SenSage Shariah Investment performance has grown as the report of June 30, 2020, says. Among all the Shariah Investors Tata Ethical Fund has given a return of 11.77% in the last five years and Taurus Ethical Fund has 12.39% in the last five years. The SenSage i25 has given a return of 16.59% in the last 3 months and Nifty Shariah 25 has given 17.38 % return in the last 3 months and 6.55% return in the last 5 years. The Nifty 50 Shariah has given a return of 7.03% in the last 5 years, and Nifty 50 (Non- Compliant) has given a return of 5.56%. The SenSage i500 has given a return of 17.10% in the last 3 months, Nifty 500 Shariah has given a return of 7.20% in the last 5 years, and Nifty 500 (Non- Compliant) has given 5.45 % return.
Any gold mutual fund scheme should be used as a thumb rule of Shariah-compliant as the money generally is invested in either gold or cash. Intending to restrict the metal import regulation permitted them to lend physical gold to banks and earn interests. Such lending of the metal from the vaults on interest may at times label the scheme as non- compliant. Gold mutual funds and Gold ETF may not give exceptional returns but are important for Shariah-compliant investors as an alternative because they are prohibited from investing in fixed income instruments. It is a good way of protecting the portfolio against exposure to equity only.
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The aggregate AUM under these three schemes is less than Rs.1,000 crore with not more than 20,000 Muslim investors. Fund Managers see this area of specialized business as politically sensitive. They also do not find meat in this segment due to discouraging numbers in the existing schemes. The community needs to rise, engage in the financial industry by impaneling as distributors and Investments Advisors. They should join the mainstream and engage in investor awareness within the potential class of investors.