Noureldin Mohamed to “ABC Borsa”: Target Plans to Launch a USD-Denominated Fixed Income Fund Before Year-End… EGX Needs Stronger Stimuli
Noureldin Mohamed, Chairman of Target Investment Group, revealed that the fixed income fund set to be launched tomorrow will invest its capital in treasury bills and bonds, with an expected average return of around 22% through daily buying and selling of fund certificates. He also stated that the group is planning to launch a USD-denominated fixed income fund before the end of the year.
Commenting on the Egyptian Stock Exchange (EGX) and current geopolitical tensions, he explained that global events, particularly those in the Middle East, have significantly increased risk levels, which in turn has a strong negative impact on the EGX in the short and medium term.
He added that high interest rates in banks have a compounded negative effect on the stock market. These include:
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Higher cost of margin trading, leading clients to avoid it.
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Reduced trading volumes.
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Increased financing costs for companies, affecting their profitability.
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And the opportunity cost, where stock market investors now seek higher returns than those offered by banks or treasury bills—considered the “risk-free rate.”
He emphasized that the stock market needs a stimulus package, targeting both investors and listed companies. He called for the IPO of major state-owned enterprises, such as the Administrative Capital Company, to boost market capitalization and attract a new segment of investors.
He also stressed the importance of pricing new IPOs fairly, to ensure investors find attractive opportunities and are encouraged to subscribe. He warned against limiting IPO allocations to large institutions based on undisclosed criteria.
Regarding global gold prices, Mohamed expects a decline in gold prices to secure profits, with the ounce price falling below $3,000 globally before year-end.