Dubai-based hedge fund Gulfmena is launching an open-ended, long-only fund with $10m AUM on 31 March.

The company’s CEO Haissam Arabi told Mena FM that the fund aims to take advantage of the current cheap valuations and distorted pricing due to regional political turmoil. “We believe having the money and being able to gradually build position as prices deteriorate offers a golden opportunity and higher reward in the medium to long-term,” he says.

The fund will offer weekly liquidity and will focus primarily on large caps that offer high beta. “Because of the nature of the top-down investment approach in regional markets, an active management style with a keen eye on strategic asset allocations will enhance alpha and drive benchmark relative outperformance,” said Arabi. “Gulfmena Access Fund is able to provide market bulk beta with incremental alpha through a top-down thematic strategic allocation approach that drives our bottom-up stock selection process. Investors are getting an actively managed strategy that provides bulk beta and incremental alpha which is designed to optimise returns but enjoy ETF-like fees,” he added.

The fund marks a departure from Gulfmena’s existing alternative strategy and reflects ongoing turmoil in the Mena market. “Mena markets remain at large an out-of-index bet, so if investors want to have exposure to this region they are looking primarily for high performance and have the stomach for the risks associated with such frontier markets,” said Arabi. “[These investors] naturally look for a long-only relative value strategy. Today the majority of foreign investors continue to seek such strategies and our new fund is designed specifically to cater to such qualified investors.”