The Qatari market slipped into negative territory (approx. 5 %) in September 2016 which made QE the second worst performing index in the region. Analysts had anticipated $300-500 million of new funds coming into the market on QE inclusion in FTSE Emerging Market Indices, but new money apparently dripped slowly into the market in the following few weeks. This was against the investor’s (mainly retail) sentiment. They panicked on anemic demand and started liquidating their positions before the long Eid holiday and climaxed right after it.

The fund, after building a cash cushion during August 2016, had started buying beaten down stocks but investors soon realized their negative sentiments were far-stretched and started indiscriminately bidding up prices. This increased prices from September lows to August highs for some major stocks. The fund took advantage and started reducing again some volatile positions and reallocating to more defensive stocks, on expectation of a dismal earnings season.

During the month, the fund lost 4.3% (net after fees and expenses) which is similar to the return of the benchmark Index. The reason for this being the fund having positions equal to the heavy weights in the benchmark. YTD the fund is up 1.4% while the benchmark is down by -3.6%, which shows the fund has outperformed the Index by 5%.