The performance exchange-traded funds in Iran’s capital market shows the value of ETFs has grown at almost the same pace as the Tehran Stock Exchange.
ETFs have posted up to 250% gain since the beginning of the current fiscal year up until July 13 parallel with the TEDPIX’s 252% gain in the same period, the Securities and Exchange News Agency reported.
Among the top-performing ETFs were Ofogh Mellat ETF affiliated to Mellat Investment Bank, the investment wing of Bank Mellat. This ETF holds assets worth about 4 trillion rials ($16.5 million)
Ofogh Mellat offered 248% return during 70 trading sessions since the beginning of the year, making it the top-performing fund.
This was followed by Sepehr Karizma ETF with returns at 246.8% and Kardan ETF with 243%. The two respectively have 10.46 trillion rial ($43.5m) and 5.02 trillion rials ($20.8m) in assets under their management.
Turquoise Partners ETF ranked fourth by gaining close to 240% in a little less than four months up until July 13. Turquoise Partners’ ETF tracks TSE’s top 30 companies and has 3.88 trillion rials ($16 million) under management.
Sarv ETF, Hasti Bakhsh Agah and Arman Atie were also among the top performing ETFs with return on investment of above 200% during the mentioned period.
An ETF is a type of fund that owns various underlying assets (shares, stocks, bonds, oil futures, gold bullion and foreign currency), rather than only one asset. They are listed on exchanges and can be traded in the stock market just like ordinary stocks.
State ETF
During the mentioned period, a government-controlled ETF started operation with shares in three banks and insurance companies.
The ETF, ‘First Financial Intermediary’, has posted 185% gain since its units became tradable in June. ETF units worth 170 trillion rials ($708m) were put on offer in May as part of the government plan to divest its shares in assorted companies.
It holds a 17% stake in Tejarat Bank, 17% in Bank Mellat, 18.32% in Bank Saderat Iran, 17.34% in Alborz Insurance Company and 11.44% in Amin Reinsurance Company.
Considering a 20% discount, the closing price of each ETF unit was 100,000 rials at the subscription stage, which has now soared to 255,000 rials.
Given that the government was not successful in selling all the ETF units in May, it plans to offer the remaining ETFs in the coming days. The government could only make 58.86 trillion rials ($245m) in the initial stage of offer, according to Abbas Memarnejad, a deputy economy minister.
