CFH Asset Management maps four fund launches

Egypt’s CFH Asset Management is preparing to roll out four new investment funds in 2026, broadening its product suite with a metals-focused vehicle and a Sharia-compliant equity fund as it seeks to capture shifting investor appetite in a volatile domestic market.

Chief executive Amr Zeidan said the Cairo-based firm aims to introduce the funds over the course of the year, subject to regulatory approvals, adding to its existing portfolio of mutual funds and discretionary mandates. The planned launches come as asset managers in Egypt navigate high inflation, currency adjustments and fluctuating interest rates, prompting demand for diversified and inflation-hedged products.

CFH Asset Management, which operates under the supervision of the Financial Regulatory Authority, has traditionally concentrated on conventional equity and fixed-income strategies. The proposed metals fund is designed to give retail and institutional investors exposure to precious and industrial metals, a segment that has drawn interest globally amid geopolitical tensions and expectations of looser monetary policy in major economies.

Gold prices have traded near record levels over the past year, driven by central bank buying and investor demand for safe-haven assets. In Egypt, local gold prices have also been influenced by exchange rate movements and import dynamics, reinforcing the appeal of metal-linked investments as a hedge against currency volatility. Analysts say that a domestically structured metals fund could attract investors who prefer regulated collective vehicles over direct bullion purchases.

The planned Sharia-compliant equity fund reflects sustained growth in Islamic finance across the Middle East and North Africa. Egypt’s Islamic banking sector has expanded steadily, with Sharia-compliant assets accounting for a rising share of total banking assets. Asset managers have responded by developing funds aligned with Islamic principles, screening companies for compliance and avoiding interest-based instruments.

Zeidan indicated that the new Islamic equity vehicle would target companies listed on the Egyptian Exchange that meet Sharia standards, offering an alternative for investors seeking faith-based products without sacrificing exposure to local growth sectors. Market participants note that demand for such funds has been supported by both retail savers and institutions seeking diversification within regulatory and ethical frameworks.

Two additional funds are also in development, though details on their specific strategies have yet to be disclosed. Industry observers expect that they may focus on fixed income or mixed-asset allocations, given the current interest rate cycle and the government’s ongoing issuance of treasury bills and bonds. Egypt’s central bank has adjusted policy rates multiple times over the past two years in response to inflationary pressures and external financing conditions, shaping returns across asset classes.

Egypt’s asset management industry has undergone structural change since the currency devaluations of 2022 and 2023 and the subsequent agreement with the International Monetary Fund. The macroeconomic reform programme, which includes fiscal consolidation and structural measures, has been accompanied by renewed foreign interest in local debt and equity markets. Equity turnover on the Egyptian Exchange has increased compared with earlier periods of subdued trading, although valuations remain sensitive to global risk sentiment.

Fund managers say that investors are increasingly looking for products that can navigate both domestic and international volatility. Metals exposure, Sharia-compliant equities and diversified strategies are viewed as ways to balance risk in portfolios affected by inflation and exchange rate adjustments.

CFH’s expansion plans also reflect intensifying competition within Egypt’s investment management space. Major banks and independent asset managers have introduced new funds over the past two years, targeting segments ranging from money market products to thematic equity strategies. Regulatory reforms have sought to enhance transparency and investor protection, with the Financial Regulatory Authority tightening disclosure requirements and governance standards.

Industry data show that total assets under management in Egypt have grown in nominal terms, supported partly by valuation effects and higher interest rates on money market instruments. However, real returns have been challenged by elevated inflation, prompting investors to reassess asset allocation.

Zeidan said the firm’s strategy is centred on broadening access to alternative exposures while maintaining disciplined risk management. He noted that metals and Sharia-compliant equities represent segments where investor demand has outpaced available supply in the domestic fund universe. By structuring the funds locally, CFH aims to provide regulated vehicles that align with domestic market dynamics and investor preferences.

Economists caution that while metals can offer protection during periods of uncertainty, they are also subject to price swings tied to global growth expectations and currency movements. Similarly, Sharia-compliant funds may face sector concentration risks, depending on the composition of the local equity market. Effective portfolio construction and transparency will therefore be critical to sustaining investor confidence.

The Egyptian market is also influenced by external factors, including energy prices, remittance flows and tourism revenues. Changes in these variables can affect liquidity conditions and investor sentiment, shaping demand for different asset classes. Asset managers expanding their product range must therefore remain attentive to both local fundamentals and international trends.