Karachi: The Meezan Gold Fund (MGF), managed by Al Meezan Investment Management Limited, has demonstrated solid financial performance in the fiscal year 2024, with a notable increase in its net assets and a competitive return on investment driven by global gold market dynamics and the depreciation of the Pakistani Rupee.

According to information available from the Pakistan Stock Exchange (PSX), the fund, which adheres strictly to Shariah principles by investing primarily in deliverable gold-based contracts on the Pakistan Mercantile Exchange (PMEX), saw its net assets grow by 28% to Rs. 1.72 billion at the end of June 2024, up from Rs. 1.35 billion the previous year. This growth comes despite the fund's total income for FY24 standing at Rs. 125 million, a decrease from Rs. 380 million reported last year, primarily due to unrealized gains on investments in gold and earnings from Islamic bank savings accounts.

MGF's asset allocation remained heavily weighted towards gold, which accounted for 87.78% of the fund's portfolio as of June 30, 2024, reflecting the fund’s strategy to leverage gold price movements for investor returns. The fund’s performance also benefited from its remaining assets being invested in cash and near cash instruments compliant with Islamic banking principles.

Over the course of FY24, the fund delivered a return of 5.38% to its investors, aligning closely with the 5.38% average annual return reported over the past three years. This performance is attributable to the rise in international gold prices coupled with the depreciation of the Pakistani Rupee, which collectively bolstered the fund's valuation and returns.

In compliance with Shariah guidelines, Meezan Gold Fund's activities and investment strategies have been regularly reviewed and certified by its Shariah advisor, ensuring that all operations remain within the bounds of Islamic finance principles. Moreover, earnings realized from prohibited sources were duly transferred to charity, maintaining the fund’s commitment to ethical investing.

The fund's distribution for the fiscal year was Rs. 2.00 per unit, totaling Rs. 20 million in payouts to its investors, highlighting its strategy to provide consistent returns amidst fluctuating market conditions.