RIYADH: Saudi Arabia’s Public Investment Fund has become an anchor investor in a newly launched exchange-traded fund by State Street Investment Management, one of the world’s largest asset managers.
The newly launched ETF, State Street Saudi Arabia Enhanced Active Equity UCITS ETF, or SAQL, actively invests in equities of companies in the Kingdom using a quantitative multi-factor stock selection model, according to a statement.
The fund is the second State Street IM ETF to receive anchor backing from PIF and marks its fifth ETF investment across nine international markets with leading asset managers.
Saudi-focused products have already been listed in Hong Kong, London, and Shanghai, as well as Shenzhen, Tokyo, and Frankfurt, and Italy and Singapore.
It also represents another move by PIF to deepen and diversify Saudi Arabia’s capital market by attracting global capital and strengthening financial institutions, as well as expanding private sector financing options and introducing new investment products.
“PIF is further strengthening Saudi Arabia’s capital market ecosystem, working with our partners to open gateways for international investors, enable access and drive global capital inflow into the country. Our continued partnership with State Street IM reinforces a shared commitment to enhance and diversify the product range, to present new opportunities for international investors into the Saudi market and unlock capital pools,” Yazeed Al-Humied, deputy governor and head of MENA Investments at PIF, said.
He added: “The launch of this ETF further deepens the Saudi market and builds on a series of PIF-anchored ETF listings across international markets, cementing PIF’s role in driving increased product diversification to enhance liquidity and fulfill market needs.”
Yie-Hsin Hung, CEO of State Street Investment Management, said: “We’re thrilled to continue our partnership with PIF by bringing another innovative Saudi-focused ETF product to market for our European clients.”
Hung added: “Saudi Arabia’s success story in recent years speaks for itself – with the combination of a rapidly expanding domestic market and a supportive regulatory landscape creating a truly compelling prospect for investors around the world. At State Street, as with PIF, innovation is in our DNA and we’re pleased to offer a new product in this same vein, drawing on our decades of experience and commitment to quality to underpin an exciting new offering, anchored by PIF.”
SAQL is primarily listed on Germany’s Xetra exchange and is also cross-listed on the London Stock Exchange, where a bell-ringing ceremony marked its debut. The fund will be accessible to investors in both markets, as well as across other major European markets.
Rankings released from the Sovereign Wealth Fund Institute in January showed that PIF climbed to fifth place among the world’s largest sovereign wealth funds, with assets under management reaching $1.15 trillion. According to the rankings, PIF demonstrated a strong domestic investment orientation, with 80 percent of its assets allocated within the Kingdom and 55 percent of its portfolio invested in alternative assets.
