11 June 2024
Unlocking potential: The evolution of Islamic asset management in the face of conventional competition
Christiane El Habre, Regional Managing Director (Middle East)
Traditionally, Islamic Asset Management (“IAM”) has consistently outperformed traditional assets (13% versus 11% over a 5-year period ending in 2021). However, IAM funds remain significantly smaller compared to traditional assets. The limited fund size, narrow range of offerings, and scarcity of providers pose challenges. Additionally, basic marketing strategies fail to appeal to the complex segmentation of the regional market and hinder subscription. Whether targeting retail customers, professional clients, family offices, managed clients, or institutional clients, IAM products struggle to gain traction, despite potential demand or allocation. Consequently, in the heartland of Islam and across the wider Middle East, it's regrettable that IAM products aren’t more widespread. This issue extends to other countries with substantial Muslim populations, such as India, Indonesia, the UK, Germany, and beyond.
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