Zawya has launched a new ranking methodology to assess the performance of Middle East funds that not only takes into consideration the usual fund returns and volatility, but also the actual level of transparency and disclosure among its peers.

"There is a fundamental need to track regional funds’ performance, volatility, loads and level of disclosure, and compliance.  As a complimentary addition to its Funds Monitor service, Zawya now ranks the top Middle East funds based on a unique, simple, and straightforward methodology," said a statement.

Pamela Chikhani, VP Funds Investment at Zawya, said: “The regional funds industry got hammered due to the financial crisis. Some funds had tremendous losses and redemptions, and had to be closed. Even some money market funds, which are considered amongst the safest asset types, defaulted. Six month into the crisis, a lot of new funds are starting up, and the Middle East funds business seems to be on its way to recovery. To what extent this holds up is still something that needs to be determined.

"Regional funds are now under more scrutiny to become more transparent. On one hand, with investors hit harder than ever, they may have lost their trust in fund managers, and have become a lot more demanding. To attract back investors and rebuild their confidence, transparency must be their paramount objective. On the other hand, central banks across the region are closely monitoring the situation, and will no longer allow ambiguous funds to exist in the market place," said Chikhani.

"That is why we decided to launch Zawya Funds Ranking. The new ranking system will benefit both investment professionals and fund managers. The former will be able to better screen Middle East funds and identify funds investment opportunities, whilst the latter are rewarded for their hard work and achievements by attracting more investors, international ones in particular, to their investment vehicles. Even those with a lower rank benefit as they can identify their weaknesses and work on improving them, thus benefiting the Middle East funds industry as a whole,” said Chikhani.

Zawya’s Funds Ranking system is independent, hence not sponsored by any party. Its emphasis on compliance and disclosure is the unique component that is very much required for the region, as the Middle East funds industry is in dire need of reform when it comes to fund laws and regulations; transparency is the crucial step towards international standardization, the statement said.-TradeArabia News Service