5 Hrs
Source:
الاقتصادية
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Saudi funds see 5% cap shift
The article discusses the decision by the Saudi Capital Market Authority to limit the investments of money market funds outside Saudi Arabia to less than 5% of their total assets. The aim is to manage risks and direct liquidity towards the local market. Experts clarified that this decision is unlikely to significantly impact the returns of the funds, given the nature of their short-term and highly liquid instruments, which primarily focus on local debt tools such as Murabahas and interbank loans. The decision also seeks to enhance the protection of investors’ funds, diversify portfolios, and channel liquidity into the local market to support debt instruments and financial markets. Additionally, it aims to reduce the external exposure of funds that have significant foreign investments. The assets of more than 50 Saudi money market funds are estimated to exceed 100 billion riyals. It is expected that the impact of this decision will be limited mainly to a few funds with substantial foreign exposure, as their foreign investments are generally limited.
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