Investors in 2021 will find themselves faced with new set of challenges when searching for value. The old paradigm of looking where relative value backed is up by strong fundamentals is still sound and probably more valid now than ever. Its during times of stress that vulnerabilities are exposed the most and the value of strong economic fundamentals come apparent. One of the after effect of COVID pandemic will be a greater polarization amongst nations and markets; there will be clearer differentiations between those who stand out and those who will falter, between the winners and the losers. Investors are now paying a closer attention to the debt sustainability and dynamics as a key performance indicator for market performance. This is understandable as debt levels were elevated even before the pandemic and continued to rise in 2020. The Institute of International Finance (IIF) estimates approximately USD 700 billion of emerging market debt in foreign currency will mature in 2021 and we are already seeing examples of countries struggling with debt repayments as austerity measures are difficult in current circumstances.
Though picking is becoming more challenging there is always value to be had and the flip side of the coin is that well performing markets will provide significant opportunities for investors seeking higher returns. Qatar’s economy is well poised to become one of the frontrunners when we enter into 2021.
When asking if the Qatar market passes the test of good relative value and strong fundamentals the evidence is strong. There is no doubt that Qatar is blessed with strong fundamentals such as vast hydrocarbon reserves and exceptionally high per capita income not the mention the government’s strong balance sheet which, as mentioned earlier is becoming a key metric for investors in 2021. The IMF has just released its latest assessment of the country and states that growing natural gas production and a rebound in domestic demand will help Qatar return to economic growth next year. Notably, IMF recognizes the implementation of strong fiscal policy as the country has proactively reprioritized some of the spending and postponed some of the non-core investment project resulting in a projected fiscal deficit of only 6% of GDP.
One of the best ways for investors to seek an exposure to Qatar economy is via Qatar Exchange Traded Funds (QETF). The QETF replicates the investment outcome of the Qatar Stock Exchange price index, through investing in the underlying companies based on their individual index weights and is therefore an easy and efficient way for investors to participate in the robust market. The QETF is open to retail and institutional investors both locally and abroad which benefit from any capital gains as well as the cumulative dividends from the underlying investment portfolio. A dedicated market maker ensures adequate secondary market liquidity.
In terms of relative value, the past performance of the QETF is second to none. Since the inception of the fund in 2018 it has provided a cumulative return of 36.5% as the Qatar stock exchange has been in the top 15 best performing markets out of the close to hundred markets worldwide and the best performer in the MENA region.
A new year marks a new beginning. While no one can predict the future, we believe the QEFT is perfectly placed to act as a gateway for investors to the prosperous economy of Qatar.
Though picking is becoming more challenging there is always value to be had and the flip side of the coin is that well performing markets will provide significant opportunities for investors seeking higher returns. Qatar’s economy is well poised to become one of the frontrunners when we enter into 2021.
When asking if the Qatar market passes the test of good relative value and strong fundamentals the evidence is strong. There is no doubt that Qatar is blessed with strong fundamentals such as vast hydrocarbon reserves and exceptionally high per capita income not the mention the government’s strong balance sheet which, as mentioned earlier is becoming a key metric for investors in 2021. The IMF has just released its latest assessment of the country and states that growing natural gas production and a rebound in domestic demand will help Qatar return to economic growth next year. Notably, IMF recognizes the implementation of strong fiscal policy as the country has proactively reprioritized some of the spending and postponed some of the non-core investment project resulting in a projected fiscal deficit of only 6% of GDP.
One of the best ways for investors to seek an exposure to Qatar economy is via Qatar Exchange Traded Funds (QETF). The QETF replicates the investment outcome of the Qatar Stock Exchange price index, through investing in the underlying companies based on their individual index weights and is therefore an easy and efficient way for investors to participate in the robust market. The QETF is open to retail and institutional investors both locally and abroad which benefit from any capital gains as well as the cumulative dividends from the underlying investment portfolio. A dedicated market maker ensures adequate secondary market liquidity.
In terms of relative value, the past performance of the QETF is second to none. Since the inception of the fund in 2018 it has provided a cumulative return of 36.5% as the Qatar stock exchange has been in the top 15 best performing markets out of the close to hundred markets worldwide and the best performer in the MENA region.
A new year marks a new beginning. While no one can predict the future, we believe the QEFT is perfectly placed to act as a gateway for investors to the prosperous economy of Qatar.