The Al-Khabeer Income Fund, known as a closed-end traded fund, is one of the prominent investment funds listed on the Saudi financial market (Tadawul). This fund features a balanced investment strategy aimed at achieving regular income for investors through a diversified portfolio of assets, including sukuk and stocks with regular cash distributions. Managed by Al-Khabeer Financial, the fund aims to meet the needs of investors seeking stability and regular income in a volatile investment environment. In this comprehensive article, we highlight the concept of Al-Khabeer Income Fund, review its regulatory details, discuss its latest financial data, and compare it with other investment alternatives in the Saudi market. We will also cover the distribution policy, unit trading methods, key risks, and the latest regulatory and operational developments. Additionally, we will answer frequently asked questions about the fund and provide a table of its key financial indicators. All of this is presented in a neutral educational language, emphasizing the importance of consulting a licensed financial advisor before making any investment decision.
Definition of Al-Khabeer Income Fund in the Saudi Context
Al-Khabeer Income Fund is a closed-end traded fund launched by Al-Khabeer Financial Asset Management, listed on the Saudi financial market (Tadawul) under the symbol 4700. According to the recent regulations of the Capital Market Authority, this type of fund allows investors to trade its units in the market like stocks, while the fund's capital remains fixed after the initial offering, providing better flexibility and liquidity compared to traditional closed-end funds. The Al-Khabeer Income Fund aims to build a diversified portfolio targeting steady capital growth with regular income distribution by investing in multiple asset classes, primarily Islamic sukuk and shares of companies with stable returns. The fund differs from Real Estate Investment Trusts (REITs) in terms of asset diversity, as it combines fixed-income instruments and stocks, while REITs often focus solely on real estate. All operations of the fund are subject to direct oversight by the Saudi Capital Market Authority, with Al-Khabeer Financial committed to providing periodic and transparent reports on portfolio performance and distribution policy.
Fund Structure and Investment Strategy
The Al-Khabeer Income Fund operates on a closed structure, meaning that the capital has been fixed since the offering, and units can only be increased or decreased by specific regulatory decision. The fund's strategy focuses on achieving stable and sustainable returns by distributing investments among low to medium-risk asset classes. The main components of the portfolio are:
- Islamic sukuk and corporate bonds: Representing a significant portion of the assets, providing regular cash flow from periodic returns.
- Shares of listed Saudi companies with stable dividends: Such as cement, telecommunications, or petrochemical companies, known for their annual or semi-annual distribution policies.
- Cash instruments and short-term deposits: To provide necessary liquidity and support distribution stability.
The fund enjoys a high degree of diversification, reducing risks associated with a single asset class. The strategy of distributing between sukuk and stocks allows for a balance between return and stability, as stock profits can offset any potential decline in sukuk returns and vice versa.
Regulatory Framework, Oversight, and Transparency
All operations of the Al-Khabeer Income Fund are subject to oversight by the Saudi Capital Market Authority, and Al-Khabeer Financial must publish audited semi-annual and annual financial reports. The fund is also required to disclose any changes in terms and conditions or investment strategy through official announcements in the financial market (Tadawul). In November 2023, some regulatory terms of the fund were updated to enhance transparency and regulate the relationship between the company and the authority, without any fundamental change in its strategy. The fund management is committed to conducting periodic reviews of portfolio performance and providing informative summaries to investors, giving them a clear view of the fund's performance, risk levels, and liquidity. This strict regulatory environment helps protect investor interests and enhance confidence in investment products traded in the Saudi market.
Financial Performance Analysis and Distributions (2024–2025)
The Al-Khabeer Income Fund experienced stability in distributions during 2024 and 2025, with distributions reaching 2.8% of the net asset value for the first half of 2024, 2.3% for the second half of the same year, and 2% for the first half of 2025. Total distributions amounted to approximately 7.1% over two years (2024–2025). The last trading price of the fund unit was around 5.37 Saudi Riyals, placing the approximate market value at 300 million Riyals (according to paid-in capital).
Since the fund does not announce net profits like companies, the price-to-earnings (P/E) ratio does not apply. Instead, its valuation relies on the distribution yield and the distribution-to-price or net asset value ratio. The semi-annual and annual financial data show sustainability in assets and cash flows, with the portfolio's ability to generate stable income supporting the regular distribution policy for investors.
Details of Trading Fund Units in the Saudi Financial Market
Units of the Al-Khabeer Income Fund are traded on the Saudi Tadawul market under the symbol 4700, following the usual supply and demand mechanism in the stock market. Any investor with a trading account can easily buy or sell units of the fund. Since the fund is closed, the number of units available for trading is limited, and new units are only issued in exceptional cases with the authority's approval. This type of fund enhances liquidity for investors compared to traditional non-traded closed-end funds, allowing entry and exit from the investment at any time during trading sessions. The unit price often stabilizes around the net asset value (NAV), with some differences reflecting supply and demand in the market. Trading liquidity is moderate, with demand concentrated among investors seeking stable periodic income.
Comparing Al-Khabeer Income Fund with Alternative Investment Products
The Al-Khabeer Income Fund offers a unique investment model in the Saudi market, combining the advantages of fixed-income funds (such as sukuk and bonds) with high-dividend equity funds. The main competing or alternative products include:
- Real Estate Investment Trusts (REITs): Focus on investing in real estate and distributing income from rents.
- Government or corporate bonds and sukuk: Provide fixed income, but are often difficult for individual investors to access directly.
- High-yield equity funds: Focus solely on stocks, increasing sector-specific risks.
- High-yield bank deposits: Offer high security with often lower returns than income funds.
The Al-Khabeer Income Fund is characterized by portfolio diversification between stocks and sukuk, reducing risks compared to investing in a single asset and enhancing return stability against market fluctuations.
Risks of Investing in Al-Khabeer Income Fund
Although the fund is designed to be low to medium risk, it carries several risks that investors should be aware of:
- Market risk: The unit value may be affected by fluctuations in stock or sukuk prices within the portfolio.
- Yield risk: Periodic distributions are not guaranteed and may change based on asset performance and market conditions.
- Liquidity risk: Liquidity is moderate compared to large company stocks, and investors may face difficulty in immediate selling during low demand.
- Regulatory risk: Any changes in regulations or terms may affect investment or distribution policies.
The fund is less risky than investing in a single stock or business project, but it is not entirely free of risks and should be evaluated within a comprehensive investment plan.
Details on the Dividend Distribution Policy and History
The management of the Al-Khabeer Income Fund adheres to a policy of approximately semi-annual dividend distribution, announcing distributions twice a year, typically in February and August. Distributions for the first half of 2024 reached about 2.8% of the net asset value, 2.3% in the second half of 2024, and 2% in the first half of 2025. The fund aims to provide regular income to investors while ensuring capital preservation and sustainability of distributions. Distributions are calculated based on net asset value and are distributed to all registered unit holders on the entitlement date. Details of each distribution are announced on the Tadawul website and Al-Khabeer Financial's site, specifying entitlement dates and payment of profits accurately.
Role of Al-Khabeer Financial in Fund Management
Al-Khabeer Financial is responsible for managing and operating the Al-Khabeer Income Fund, a licensed Saudi company by the Capital Market Authority specializing in asset and investment management. The company determines the investment strategy, selects assets, and monitors the financial performance of the portfolio. It also oversees the periodic disclosure of the fund's results and updates terms and conditions according to the authority's requirements. The fund management team includes experts in financial analysis, risk management, and evaluating investment opportunities in the Saudi market. The company is committed to the highest standards of transparency and governance, reflecting on the fund's performance stability and investor confidence.
Regulatory and Operational Developments in 2024–2025
The Al-Khabeer Income Fund witnessed several important developments during 2024 and 2025:
- Updating terms and conditions in November 2023 to enhance transparency and regulate the relationship with the Capital Market Authority.
- Announcing annual and audited financial statements for the periods ending December 2023 and December 2024, enhancing disclosure and transparency.
- Continuing the semi-annual distribution policy, maintaining levels close to 2–3% for each half-year.
- The fund's interaction with changes in local interest rates and increased demand for fixed-income instruments amid local and global economic conditions.
These developments reflect the fund management's commitment to providing a renewed investment product compliant with Saudi market standards.
Analysis of the Investment Fund Sector and Al-Khabeer Income Fund's Role
The Al-Khabeer Income Fund is classified within the financial investments and funds sector, a rapidly evolving sector in the Saudi market due to continuous updates in regulations and systems. The fund represents an advanced model of traded closed-end funds, providing an important alternative for investors seeking periodic returns without bearing high risks. The fund allows investors to benefit from fixed income advantages with a higher degree of diversification than real estate or bond-only funds. Amid the scarcity of similar products in the local market, Al-Khabeer Income Fund stands out as a leading option targeting individual and institutional investors seeking sustainable and balanced income solutions.
The Relationship Between Al-Khabeer Income Fund and Saudi Companies with Dividends
The Al-Khabeer Income Fund invests in shares of Saudi companies known for their regular dividend distributions, such as cement companies (e.g., Qassim Cement or Hail Cement with symbol 3001), telecommunications companies, and some industrial firms. This investment enhances the fund's ability to achieve periodic income and helps diversify sources of return, reducing reliance on a single asset class. It also allows investors to benefit from the stability of these companies' profits without needing to purchase the stocks directly and bear their fluctuations entirely. This is one of the key strengths that distinguish the fund from real estate funds or growth-oriented equity funds.
How to Monitor Fund Performance and Obtain Official Information
Fund performance can be monitored through several official and reliable sources:
- The Saudi Tadawul website: Publishes all fund announcements regarding distributions, financial statements, and updates on terms.
- Argaam Financial website: Displays periodic data on unit price, distribution yield, and fund news.
- The official website of Al-Khabeer Financial: Provides periodic newsletters, financial reports, and updates on the fund's strategy.
- Local economic newspapers: Such as "Maal" and "Al-Eqtisadiah" that cover distribution news and regulatory changes.
It is always advisable to refer to these sources and verify updates before making any investment decisions.
Conclusion
The Al-Khabeer Income Fund offers an advanced investment model in the Saudi market, combining the advantages of periodic income, diversification, and lower relative risks. Through a strategy based on sukuk and stocks with regular distributions and a transparent profit distribution policy, the fund provides an attractive option for a wide range of investors seeking sustainable income and capital stability. However, many factors should still be considered, such as market liquidity, asset price volatility, and regulatory changes. For this reason, the SIGMIX platform emphasizes the necessity of consulting a licensed financial advisor before making any investment decision or purchasing units in the fund, to ensure alignment with each investor's financial goals and investment capacity.
Frequently Asked Questions
The Al-Khabeer Income Fund is a closed-end traded investment fund in the Saudi financial market, managed by Al-Khabeer Financial. The fund aims to achieve stable periodic income for investors through a diversified portfolio of Islamic sukuk and shares of Saudi companies with regular cash distributions. Its units are traded on the stock exchange like shares and are subject to regulatory oversight by the Capital Market Authority.
Units of the Al-Khabeer Income Fund can be bought and sold through the Saudi Tadawul platform in the same way as stocks. The fund carries the symbol 4700, and investors can execute buy and sell orders during official trading hours through their bank accounts or brokerage firms. As a closed fund, the number of units is limited, and the price depends on supply and demand in the market.
The fund relies on a balanced investment strategy that combines Islamic sukuk (and sometimes corporate bonds) providing fixed income, and shares of listed companies with stable dividends. This diversification aims to reduce risks and achieve sustainable returns, allowing one asset class to offset any potential decline in another, focusing on stability and periodic income.
During 2024 and 2025, the fund distributed profits at rates of 2.8% (first half of 2024), 2.3% (second half of 2024), and 2% (first half of 2025) of the net asset value. Total distributions amounted to approximately 7.1% during that period. Distributions are made semi-annually and depend on portfolio performance and returns generated from investment assets.
There is no minimum investment requirement for purchasing units of the Al-Khabeer Income Fund from the secondary market (Tadawul). Any investor with a trading account in the Saudi financial market can buy any number of units as desired, subject to the announced terms and conditions of the fund. It is always recommended to review the updated terms before purchasing.
The main risks include: fluctuations in asset prices within the portfolio (stocks or sukuk), the possibility of reduced distributions if economic conditions change, liquidity risks due to the limited number of units, and regulatory risks in case of changes in regulations. While the fund is less risky than investing in a single asset, it is not free from financial risks.
The fund's performance can be monitored through the Saudi Tadawul website, which publishes all official announcements, or through the Argaam Financial website, in addition to the official website of Al-Khabeer Financial, which provides periodic reports and updates on performance and distributions. Local economic newspapers also cover the fund's news periodically.
The Al-Khabeer Income Fund differs from Real Estate Investment Trusts (REITs) in that the latter focuses solely on real estate investment and distributing income from rents, while the Al-Khabeer Fund distributes capital between sukuk and stocks with periodic returns, providing greater diversification and reducing reliance on a single sector.
All operations of the Al-Khabeer Income Fund are subject to direct oversight by the Saudi Capital Market Authority, and Al-Khabeer Financial is committed to periodic disclosure of financial performance, distributions, and any changes in terms through the Tadawul website. Annual and semi-annual financial statements are audited by independent entities.
Consulting a licensed financial advisor is crucial before making any investment decision, even in relatively low-risk products like income funds. The advisor helps assess the fund's suitability for your financial goals and investment capacity, providing specialized insights on portfolio diversification and risk management within your overall plan.
Rising interest rates typically increase the attractiveness of fixed-income instruments such as sukuk, which may support the fund's performance. Conversely, lower interest rates may reduce the returns of these instruments. Additionally, the stock profits within the portfolio are affected by general economic conditions, and the fund's diversification works to balance these effects to minimize overall return volatility.