Dec 2020 pdf-icon


The BMA Empress Cash Fund is a professionally managed cash fund, which aims to minimize risk, maximize liquidity and generate a competitive rate of return. This will be achieved by concentrating portfolio allocation in AA rated banks and short duration sovereign rated securities.


Year Returns BM
FY 2016 4.61% 5.82%
FY 2017 4.58% 5.29%
FY 2018 4.45% 5.35%
FY 2019 8.84% 8.71%
FY 2020 11.47% 11.70%

Fund Type Open End
Category Money Market Fund
Inception Date 12-Nov-09
Benchmark 70% 3M PKRV + 30% 3M Bank Rate
Dealing Days Monday-Friday
Cut‐off time 4:00 PM
Pricing Mechanism Forward
Management Fee 0.35%
Front end Load upto 1%
Back End Load Nil
Fund Stability Rating AA+ (F) (JCR)
Risk Profile Low Risk
Listing PSX
Trustee MCBFSL
Auditor EY Ford Rhodes, Chartered Accountants
Transfer Agent Technology Trade
Legal Advisors KMS Law Associates
Management Quality Rating AM4++
Expense Ratio* 1.55%
*This includes 0.27% of SECP Fee & Govt. Levy


In Nov‐20, BECF earned an annualized return of 5.68% as against benchmark of 6.63%, underperformed by 95bps. The fund was mainly invested in T‐Bill equivalent to 84.78%, while 14.90% of the portfolio were invested in bank deposits
during the month.



Easing inflation numbers, enhancement of Current Account surplus, improving industrial activity, and announcement of successful Covid‐19 vaccine trials by Pfizer and BioNTech remained the key events for the month of November 2020.
Macroeconomic indicators recorded improvement during the month of November 2020. Most notably, Current Account for the month of October 2020 posted another surplus of USD 382 Million on the back of strong remittances (↑14.0% YoY to USD 2.28 Billion), and an encouraging sequential improvement of 11.0% in goods & services deficit to USD 1.74 Billion. This was the fourth consecutive month where the Current Account remained in surplus, resulting in accumulative surplus of USD 1.2 Billion during 4MFY21 vis‐à‐vis a deficit of USD 1.4 Billion in the same period last year.
Strong external account position along with improvement in country’s FX reserves (↑USD 842 Million to USD 20.2 Billion during November 2020) kept PKR/USD unchanged by the end of the month. Stable and relatively cheap PKR against major regional currencies is helping Pakistan post a steady revival in export orders, specifically in home textile and value‐added segments.
Other indicators such as the Large‐Scale Manufacturing Index (LSM) also showed an improvement of 4.8% YoY during July to September 2020.
National Consumer Price Inflation (NCPI) for the month of November 2020 showed a lower reading of 8.3% YoY vis‐àvis 8.9% YoY in Oct’20. The sequential outturn also showed a slowdown in recent inflationary trends (0.8% MoM visà‐vis 1.7% MoM in Oct’20) as prices of key food items such as wheat and pulses showed some reversal. Prices of heavyweight commodities in the inflation basket such as wheat, sugar, pulses, milk, etc. have continued to escalate in the past few months and a pull‐back in the same is a welcome sign. From a political perspective, receding inflation readings are a sigh of relief for the incumbent government, as it has faced hefty criticism from the masses over sharp
price increases. From an analytical perspective, easing prices and the high‐base effect from last year will continue to show lower YoY readings until January 2021. Given the inflation trajectory, we estimate NCPI for FY21 to average in the range of 7‐8% YoY, which implies a negative real rate of 0‐1% compared to SBP’s Policy Rate of 7.0%.
The negative output gap persists and Non‐Food‐Non‐Energy (NFNE) readings continue to remain weak, indicating weak domestic demand despite a loose monetary policy. We believe, inflation readings will ease further in the coming months as imported food staples arrive in the country. Achieving growth targets will continue to remain SBP’s prime focus, in our view. Moreover, the second‐wave of Covid‐19 is ongoing in the country with partial/cluster‐based lockdowns being imposed across the country. Present circumstances dictate a lenient monetary policy (negative real rates) as weaker‐than‐expected GDP growth could have serious repercussions for Pakistan’s debt indicators.
Therefore, we continue to believe that Policy Rate is likely to stay unchanged until 1Q of 2021.

Disclaimer: This publication is for informational purposes only and nothing herein should be construed as a solicitation, recommendation or an offer to buy or sell any Fund. All investments in mutual funds are subject to market risks. The NAV based prices of units and any dividends/returns thereon are dependant on forces and factors affecting the capital markets. These may go up or down based on market conditions. Past performance is not necessarily indicative of future results.

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