(part 5 of 6)

Preface:
At the four previous parts, we talked about how investment faces risk beside return, structured investment as another way instead of portfolio in investment, islamic structured investment, and the first example. Now, read the second example.

4.2. PNM EKUITAS SYARIAH

The Product²⁰. PNM²¹ Ekuitas Syariah is an opened Mutual Fund (Reksa Dana) in the form of Collective Investment Contract that is offered by PT. PNM Investment Management as Fund Manager and The Hongkong and Shanghai Banking Corporation Limited (HSBC) as the Custodian Bank. PT. PNM Investment Management publishes general offering of PNM Ekuitas Syariah up to 500.000.000 (five hundred millions) investment units. The investor can buy a minimum investment unit by Rp. 500.000,- and maximum not more than 10.000.000 (ten millions) investment units or 2% of total investment units offered.

Regarding the general offering forum, three companies has paid the 7.000.000 initial investment units with total asset is Rp. 7.000.000.000,- The composition of the three companies as below:

PNM Ekuitas Syariah is launched to obtain optimum investment growth of fund by maintaining capital in a short, medium, or long-term through placement of fund to money market, shari’ah bonds, and equity instruments.

The Structure. Investment portfolio will manage actively by diversification and based on islamic law in securities. All assets will invest to:

• Minimum 80% at shari’ah equity.
• Maximum 20% at shari’ah bonds and/or shari’ah security instruments.
• Minimum 2% in cash.

The capital of investors are allocated in several shari’ah equities that listed at Shari’ah Equities List of BAPEPAM & LK as portfolio mutual fund below:

Figure-6. Portfolio of PNM Ekuitas Syariah²²

For each profit received by PNM Ekuitas Syariah, Fund Manager will not directly give in cash to investors, but it will be reinvested to improve its Net Asset Value (NAV) per investment unit.

Investment decision taken by Fund Manager will controlled by Shari’ah Committee that its members are ‘ulama and economist expert that have enough competence in islamic financial law. They are: Prof. KH. Ali Yafie (head), Dr. H. Muhammad Syafi’i Antonio (member), Dr. KH. Didin Hafiduddin (member), Dr. KH. Anwar Ibrahim (member).

The Features. Some features of PNM Ekuitas Syariah are:

Investor will be comfortable in investment because the portfolio is managed by a professional Fund Manager with experience more than 11 years. Investor can monitor the growth of investment easily through national newspaper, website, toll free, and SMS services.

The scheme of subscription to buy the investment unit of this PNM Ekuitas Syariah, how to redemption, and switching is as illustrated as below:

Figure-7. Subscription Scheme (buy investment unit)²³

Figure-8. Redemption Scheme

Figure-9. Switching Investment Unit Scheme

Notes. PNM Ekuitas Syariah is one of Mutual Fund scheme offered to investors. From its portfolio, it shows that the capital is allocated on company equities that have business in real sector, public services, and far from haram business that is prohibited by islamic law. At least Semen Gresik, Aneka Tambang, Timah, Telekomunikasi Indonesia, International Nickel Indonesia, and Tambang Batubara Bukit Asam are companies that hold main commodities and services in Indonesia. Monitoring the last two years growth of this Mutual Fund with positive trend compared with JII (Jakarta Islamic Index) , it shows that it is a safe and comfortable investment. Look the graphics of this Mutual Fund growth at the last two years in the next page.

However, watching the proportion in its real portfolio, it shows that equity composition is 91,57%. It means that the composition of equity in capital allocation is more than commitment declared at PNM Ekuitas Syariah prospectus document.

Figure-10. PNM Ekuitas Syariah Profile (at the last month)²⁴

It is good choice for investment, as long as the performance is very good in generating profit. But, there is one clausul in the prospectus to clarify. It is about cleansing process. Short-term placement at conventional deposit that is impossible to avoid will generate an interest (riba). Fund Manager will clean it through cleansing process by separating interest result from portfolio to use in a good activities (maslahah) for ummah based on guidance of Shari’ah Committee. It shows that this Mutual Fund is still related to interest (riba), even in a small proportion and there is a mechanism to clean it. It is something that investor better to know.

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²⁰ PT. PNM Investment Management. Prospektus Reksa Dana PNM Ekuitas Syariah. July 26, 2007
²¹ PNM is abbreviation of PT. Permodalan Nasional Madani, a state-owned company of Indonesia that is built for empowering Small, Middle, and Cooperation Business (UKMK)
²² Profile of PNM Ekuitas Syariah is taken from PortalReksadana.com. Accessed: October 23, 2009. Available online at: http://portalreksadana.com/rdproduk/profil/035600493431
²³ PT. PNM Investment Management. Page 38-39
²⁴Profile of PNM Ekuitas Syariah. Op.Cit.