Gulf Investment Corporation (GIC) announced that its Gulf-wide GIC Composite Index passed the record 10,000 mark during February.
This high was 10,060.61 points which represents an increase of 106.6% on the Index’s 52 week low of 4,869.19 recorded in February 2005.
Commenting on the result, Malek Issa Al- Ajeel, GIC’s Head of Business Development, said today that the GIC Composite Index reflects the remarkable strength of equity markets in the six Gulf Cooperation Council (GCC) States.
“There has been strong and sustained growth in the GCC stock markets in the last two years,” Malek Al-Ajeel said. “This has been driven by high levels of liquidity, rising oil prices and major infrastructure projects which have provided a stimulus to Gulf economies.”
Al-Ajeel said the GIC Composite Index is recognized as the most authoritative and reliable performance benchmark for equity markets in the GCC region.
“The Composite Index is based on GIC’s Country Indices, which apply a consistent, globally accepted calculation methodology across all six markets of the GCC,” Malek Al- Ajeel said. “It contains 158 companies with a total private sector market capitalization of $522.48 billion and an average daily trading of $5.01 billion over the last quarter.
“Securities are carefully selected for inclusion on the basis of genuine trading liquidity and adequate market representation. A company must be active and liquid in the market in two out of three consecutive quarters. This ensures that any rise in the Index is a true reflection of performance and is not attributable to one-off factors. Non-traded and government-held securities are excluded from the Index.
“The GIC Composite Index was the first of its kind in the region to look at all six GCC countries as an integrated market,” Al-Ajeel said.
The Composite Index is used by GIC fund managers as a highly effective road map to determine funds allocation and sector-specific strategies.
“Using the Index, Gulf Premier Fund managers have recorded an absolute net return of more than 297% since inception in April 2003 without a single negative quarter,” Al-Ajeel said. The fund has also recorded a net return of 82.3% in 2005 and a net return of 4.11% for the first two months of 2006.
“When compared to other GCC equities funds, the performance of the Gulf Premier Fund confirms GIC’s success in applying the Composite Index approach to our GCC equities investments.”
GIC is a leading regional financial institution established under the auspices of the Gulf Cooperation Council and is equally owned by the six member states of the Council: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
