SAB Invest Launches Saudi Arabia’s First Quantitative ETF

SAB Invest today announced the launch of the SAB Invest Saudi Quant ETF, Saudi Arabia’s first exchange-traded fund built on a quantitative investment strategy. This milestone introduces a new generation of ETFs designed specifically for the Saudi market, adapted from an HSBC model that has managed over USD 34 billion globally, shifting from traditional index tracking to a systematic, data-driven approach.

The SAB Invest Saudi Quant ETF uses rules-based modelling to identify market inefficiencies and construct a diversified, Sharia-compliant portfolio based on value and momentum factors. The fund targets companies with attractive valuation and strong momentum characteristics, combining advanced data analysis with disciplined portfolio construction.

Over a decade of back-testing supports the approach, indicating potential for enhanced returns, improved diversification, and reduced concentration risk compared to traditional benchmarks.

A Timely Response to Market Demand

Key benefits of the SAB Invest Saudi Quant ETF include:

- Broad Market Exposure: With diversified Sharia-compliant holdings across various industries, the fund provides access to a wide swath of the Saudi economy beyond large-cap benchmarks.
- Alignment with Saudi Vision 2030: The launch of the quant strategies and the ETF is a contribution to the development and innovation within the investment management industry and financial sector.
- Systematic Opportunity Capture: The quantitative methodology identifies companies with favourable characteristics to capture excess returns in the Saudi market.

The launch comes at a time of increasing interest in quantitative strategies globally and a growing demand for efficient, transparent investment vehicles within Saudi Arabia. With robust regulatory frameworks, a strong IPO pipeline, and the macroeconomic stability afforded by sound government policies, the local market offers a compelling environment for such innovation.

SAB Invest Chief Investment Officer Osama Alowedi said: “As the first mover in the quantitative ETF space in the Kingdom, SAB Invest aims to meet the needs of a diverse investor base and attract foreign investment into the Kingdom while advancing innovation and analytical depth in the Saudi financial ecosystem.”

The SAB Invest Saudi Quant ETF is now publicly listed and available through Tadawul.

About SAB Invest
SAB Invest is an independent investment subsidiary fully owned by the Saudi Awwal Bank (SAB). It works to become a leading provider of innovative investment management solutions for both private and institutional clients, delivering top quality products and services throughout the Kingdom of Saudi Arabia.