HSBC Asset Management (HSBC AM) has launched GBP FX-hedged share classes for its Global Sukuk UCITS ETF, giving UK-based investors an opportunity to access global sukuk markets while reducing the impact of currency fluctuations against sterling.
The new share classes are designed to make the fund more accessible to UK pension clients seeking Shariah-compliant sukuk exposure while managing foreign-exchange risk. According to HSBC AM, demand for sukuk investments among UK pension schemes is increasing, with institutional investors seeking greater exposure to the asset class while limiting the volatility associated with movements between sterling and other currencies.
HSBC Asset Management said the new structure represents the market’s first Shariah-compliant FX-hedged share classes for a passive UCITS sukuk fund. The initiative reflects the growing demand for investment products that combine index-based sukuk exposure with currency-management solutions that remain consistent with Shariah principles.
“Investors are increasingly looking for ways to access index-based Sukuk exposure while managing currency risk in a way that remains aligned to Shariah principles,” said Olga de Tapia, Global Head of ETF & Indexing Sales at HSBC Asset Management.
The launch highlights the continued development of Shariah-compliant investment products within the global asset-management industry. As institutional investors increasingly explore sukuk as part of diversified fixed-income portfolios, products that address practical investment considerations such as currency risk could help broaden participation in the global sukuk market.
The introduction of GBP-hedged share classes also demonstrates the growing convergence between Islamic finance, ETFs and institutional investment solutions, providing investors with additional flexibility to access sukuk while managing their exposure to foreign-exchange movements.