September 2013

The Month in Review

ECONOMIC OUTLOOK
After a spell of higher CPI readings over the last two months, Pakistans headline Inflation clocked in at 7.39%, much below the previous months number of 8.55%. On a monthly basis, inflation declined by 0.29% as compared to an increase of 1.16% in August. Benign inflation for September has brought down 1QFY14 CPI average to 8.06% YoY, connoting a positive real return of 1.44% and hinting towards a laxer increase in policy rate than originally anticipated. As per the latest statistics released by the State Bank of Pakistan, the current account deficit for the month of August stands at USD 575mn as opposed to a minor deficit of USD 57mn (revised) registered during July 2013. Moreover, Inward Remittances, which have been providing respite to the faltering current account, declined by 12% MoM to close at USD 1,258mn adding further pressure to the current account deficit. Current account numbers weighed heavily on foreign exchange reserves over September; however, the Central Banks bid to shore up foreign exchange reserves under IMF guidelines helped prop up reserves to USD 10.2bn as of September 20, 2013 up 2.1% since August 2013. The increase in reserves was also attributable to first installment of USD 544mn from IMF under the Extended Financing Facility. Despite rise in reserves, massive repayments of USD 1.15bn scheduled till December 2013 will continue to pressurize the state treasury. Continuous pressure on reserves coupled with uncertainty on the external front and dwindling economic indicators have caused the Pak Rupee to shed 1.52% against the greenback, with expectation of further depreciation in the coming months. Going forward, economic direction is anticipated to be in line with IMF guidelines provided to the government. With the new EFF program being front-loaded with contingencies, we expect the state administration to be more docile and cooperative this time around. The federal government is likely to implement all strategic reforms that are required to appease the IMF which is essentially also critical for achieving long-term economic wellbeing. August, however, SBP rejected the bids received in three OMOs, accepting seven mop-ups totaling PKR 689.75bn against target of PKR 913bn. The Central Bank also increased the discount rate during the month, raising the benchmark from 9.0% to 9.5% for the next two months. The regulatory authority deemed rising inflation, narrowing real returns and depreciating Pak Rupee as major reasons behind the policy decision. Following the policy hike, the Central Bank tightened the noose around commercial banks, locking their interest spreads by pegging rate on saving deposits to SBP repo rate (i.e. floor rate of SBP interest rate corridor). Shorter tenor treasuries continued to trade at lower yields earlier in the month owing to high liquidity, while longer tenor treasuries and bonds reached staggering levels on account of monetary contraction expectations. The differential between the prevailing discount rate and Pakistan Investment Bonds (PIBs) crossed historical highs continuing with the trend even after the Central Bank increased the policy rate by 50bps. The yield exuberance displayed by longer tenor securities certainly hints towards apprehension in the market concerning substantial monetary contraction in the months to come.

EQUITY MARKET
Although the worlds major indices witnessed a growth on account of US Federal reserve direction, bearish momentum continued to dominate the local bourse during the month of September, with benchmark index down by 1.49% to reach 21,833 points. Increase in the policy rate by 50bps, sharp devaluation of local currency and a 0.5% hike in Minimum Deposit Rate (MDR) for banks resulted in subdued investor sentiments. Positively, on CYTD basis, KSE-100 index managed to stay on top with a return of 18.4% (USD Returns) outclassing regional peers. Market volumes witnessed a surge of 6.7% MoM in September up 46% MoM, whereas value traded weakened by 13.9% MoM to USD 92mn. The drop in value traded was primarily attributable to volumes witnessed in low-tier stocks. Going forward, with currency depreciation expected to dominate headlines, we anticipate Chemical, Telecom, Electricity and Textile sectors to be major beneficiaries. Oil Marketing Companies, on the other hand, are expected to be negatively impacted owing to heavy imports.

MONEY MARKET OUTLOOK

The money market remained liquid for a major part of the month, succumbing to the unyielding mop-ups conducted by the State Bank of Pakistan (SBP) via Open Market Operations (OMOs). The Central Bank conducted a total of 10 OMO mop-ups over September, tallying the frequency of OMOs conducted over the previous month. Unlike
MUFAPs recommended format

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.

Money Market Fund

FUND INFORMATION
Fund Type Category Stability Rating Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets (PKR mn) Leverage Weighted Average Maturity (days) 23.00 Open Ended Money Market Scheme AA+(f) (JCRVIS) Low December 13, 2010 CDC Ernst & Young Ford Rhodes Sidat Hyder 0.80% Nil PKR 5000 50% 3 month T-Bills and 50% Average 3 months deposit rate of AA rated and above banks Backward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 101.53 4,495.46 Nil
T-Bills, 65.97% T-Bills, 69.37%

FUND RETURNS
(Holding Period Annualized % p.a) FY14 to Date Benchmark (YTD) Month on Month Benchmark (MoM) Sep13 7.36 7.96 7.23 8.00 Aug13 7.38 7.87 7.24 7.89

ASSET ALLOCATION (% OF TOTAL ASSETS)

Placements with Banks and DFI, 20.72% Others including receivables, Cash , 0.25% 13.06% Others including receivables, 5.76% Placements with Banks and DFI, 15.18% Cash, 9.69%

Sep13

Aug13

Investment Objective
Faysal Money Market Fund (FMMF) seeks to provide stable and competitive returns in line with the money markets exhibiting low volatility consistent with capital preservation by constructing a liquid portfolio of low risk short term investments yielding competitive returns.

ASSET QUALITY (% OF TOTAL ASSETS)

Government Securities AAA AA+ AA NR (includes receivables against sale of Government Securities) 65.97% 0.07% 9.76% 23.95% 0.25%

8.19% 9.69%

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The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 9,821,016 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 0.222 (0.22%). For details investors are advised to read the latest financial statements for the Quarter and Nine months ended March 31, 2013.

Performance Review
FMMF ended September with its highest ever assets under management of PKR 4,495mn depicting a growth of 56.5% during 1QFY14. Your fund generated a return of 7.23% in September 2013 - clocking in FY14 YTD return at 7.36%. Bearing in mind the uncertainty associated with policy rate, funds were deployed in shorter tenor instruments while residual cash was deployed in other high yielding avenues. With over 75% of investments of your fund positioned in prime quality instruments (i.e. AA+ or higher), FMMF has the highest fund stability rating within the money market category.
MUFAPs recommended format
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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Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Syed Shahid Iqbal Mr. Imran Altaf Mr. Muhammad Asif Tahir Mr. Muhammad Faraz Khan

Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Fund Manager (Fixed Income) Fund Manager (Fixed Income) Head of Compliance & Internal Audit Manager Risk

7.85% 8.28%

8.02% 7.66%

8.00% 6.00% 4.00% 2.00% 0.00%

7.89% 7.24%

8.00% 7.23%

7.65% 7.90%

7.81% 7.71%

7.83% 7.48%

10.00%

8.15% 7.73%

8.16% 8.12%

8.31% 7.89%

8.22% 8.86%

INVESTMENT COMMITTEE

Returns(MoM) Benchmark FMMF

Savings Growth Fund

FUND INFORMATION
Fund Type Category Stability Rating Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets(PKR mn) Leverage Weighted Average Maturity (Years) 0.74 Open Ended Income scheme AA - (f) Low May 12, 2007 CDC Ernst & Young Ford Rhodes Sidat Hyder 1.50% Nil PKR. 5,000 75% 6M KIBOR & 25% 3M PKRV Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 102.21 876.50 Nil
T-Bills, 36.73% PIBs, 10.89%

FUND RETURNS
(Holding Period Annualized % p.a) FY14 to Date Benchmark (YTD) Month on Month Benchmark (MoM) Sep13 7.04 9.10 6.82 9.20 Aug13 7.10 9.05 7.19 9.08

ASSET ALLOCATION (% OF TOTAL ASSETS)

TFC, 7.61% Others including Ijara Sukuk, receivables, 0.88% 5.40% Cash , 23.97% Ijara Sukuk, 10.08% TFC, 11.14% Others including Cash , Receivables, 2.30% 1.11% Placement with Banks and DFIs, 15.06%

Placement with Banks and DFIs, 14.52%

PIBs, 10.22%

T-Bills, 50.09%

Sep13

Aug13

TFCs/SUKUK Holdings (% of Total Assets)

BAFL V BAHL III 5.50% 2.11%

ASSET QUALITY (% OF TOTAL ASSETS)

Investment Objective
To generate competitive returns by investing primarily in debt and fixed income instruments having investment grade credit rating.

Government Securities AAA AA+ AA AANR (includes receivables against sale of Government Securities)

53.02% 0.07% 0.40% 17.66% 27.97% 0.88%

9.49%

9.38%

9.54%

9.56%

9.41% 8.16%

9.37% 8.85%

9.29%

9.35%

INVESTMENT COMMITTEE
Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Syed Shahid Iqbal Mr. Imran Altaf Mr. Muhammad Asif Tahir Mr. Muhammad Faraz Khan Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Fund Manager (Fixed Income) Fund Manager (Fixed Income) Head of Compliance & Internal Audit Manager Risk

11.00% 10.00% 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00%

9.75% 10.23%

Returns(MoM) Benchmark FSGF

9.03% 9.08% 7.19% 9.20%

7.42%

7.26%

7.51%

7.53%

5.01%

6.67%

6.97%

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The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 48,196,701 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 6.085 (5.95%). For details investors are advised to read the latest financial statements for the Quarter and Nine months ended March 31, 2013.

Performance Review
Faysal Savings Growth Fund generated an annualized yield of 6.82% over the month of September, allowing YTD return to consolidate at 7.04%. Exposure in T-Bills was reduced from 50% to 37% during the month, whereby proceeds were mainly placed in longer tenor bonds to capitalize on widening differential between PIB yields and policy rate. Cash in bank was increased from 10% to 24%, to ensure adequate liquidity and to provide a cushion in the current volatile environment. Going forward, the fund shall continue to focus on high credit quality assets to raise fund yields.
MUFAPs recommended format
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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6.82%

Financial Sector Opportunity Fund

FUND INFORMATION
Fund Type Category Stability Rating Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front end Load Back end Load Min Subscription Benchmark Pricing Mechanism Dealing Days Cut-Off Timings AMC Rating NAV per Unit (PKR) Net Assets (PKR mn) Leverage Weighted Average Maturity (days) Open Ended Income Scheme Not Rated* Moderate July 05, 2013 CDC Ernst & Young Ford Rhodes Sidat Hyder 0.50% Upto 1.75% under the investment amount of PKR 10 mn NIL PKR 5,000 70% 6M rolling average of 6M KIBOR and 30% of average deposit rate of 3 Banks rated AA-and above. Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 100.81 458.15 Nil 157.08

FUND RETURNS
(Holding Period Annualized % p.a) FY14 to Date Benchmark (YTD) Month on Month Benchmark (MoM) Sep13 7.34 8.44 7.41 8.51 Aug13 7.25 8.34 7.18 8.35

ASSET ALLOCATION (% OF TOTAL ASSETS)

Others including Receivables, 1.17% TFC, 5.60% Placement with Banks and DFI, 9.26% Others TFC, including 0.04% receivables, 0.80%

Placement with Banks and DFI, 33.60%

Cash , 59.64%

T-Bills, 28.85%

Cash , 61.05%

Sep13

Aug13

ASSET QUALITY (% OF TOTAL ASSETS)

AAA AA AANR (includes receivables against sale of Government Securities) 9.75% 83.48% 5.60% 1.17%

*Not applicable as per rating criteria of rating agency

Investment Objective
Faysal Financial Sector Opportunity Fund (FFSOF) seeks to provide a competitive rate of return to its investors by investing in money market and debt instruments with major exposure in financial sector.

TFCS/SUKUK HOLDINGS (% OF TOTAL ASSETS)

Bank Alfalah Limited V
8.33% 8.35% 8.51%

5.60%
Returns(MoM) Benchmark FFSOF

9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00%

7.30%

INVESTMENT COMMITTEE
Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Syed Shahid Iqbal Mr. Imran Altaf Mr. Muhammad Asif Tahir Mr. Muhammad Faraz Khan Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Fund Manager (Fixed Income) Fund Manager (Fixed Income) Head of Compliance & Internal Audit Manager Risk

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7.18%

NON COMPLIANCE
Name of Investment Company
Habib Bank Limited Pak Iran Joint Investment Company Limited

Rating Existing required Rating

Maximum Existing Exposure as Exposure a % of NAV as a% of NAV

10 10.37

Excess Type of Exposure % Instrument

Clean Placement Clean Placement

Value of Investment before provisioning

Provision (If any)

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Value of Investment after provision

45,000,000

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% of Net Assets

7.41%

% of Total Assets
9.75

N/A

N/A

0.37

45,000,000

10.37

N/A

N/A

10

10.37

0.37

45,000,000

45,000,000

10.37

9.75

The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 195,448 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 0.045 (0.05%).

Performance Review
Faysal Financial Sector Opportunity Fund yielded an annualized return of 7.41% during September 23bps higher on a MoM basis. The performance demonstrated during the month allowed your fund to maintain its rank amongst the top most quartile of the Income Category. On the asset allocation side, funds were redeployed from shorter tenor government instruments to other high yielding avenues to generate higher yields. Going forward, the fund shall continue to focus on high credit quality assets and aim to provide competitive returns.
MUFAPs recommended format
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.

Islamic Savings Growth Fund

FUND INFORMATION
Fund Type Category Stability Rating Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets (PKR mn) Leverage Weighted Average Maturity (years) 0.68 Open Ended Islamic Income Scheme AA - (f) (JCRVIS) Low June 14, 2010 CDC Ernst & Young Ford Rhodes Sidat Hyder 1.50% Nil PKR 5,000 Average 6M deposit rate of 3 Islamic Banks Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 102.01 722.09 Nil
Government Backed/ Guaranteed securities, 50.91% Cash , 47.61%

FUND RETURNS
(Holding Period Annualized % p.a) FY14 to Date Benchmark (YTD) Month on Month Benchmark (MoM) Sep13 6.09 6.90 5.63 6.86 Aug13 6.29 6.92 6.15 6.78

ASSET ALLOCATION (% OF TOTAL ASSETS)

Others including receivables, 1.48%

Others including receivables, 2.20%

Sep13

Government Backed/ Guaranteed securities, 41.53%

Cash, 56.27%

Aug13

ASSET QUALITY (% OF TOTAL ASSETS)

Government Securities AAA AA+ AA A NR (includes receivables against sale of Government Securities) 50.91% 0.07% 0.38% 47.15% 0.01% 1.48%

Investment Objective
Faysal Islamic Savings Growth Fund (FISGF) seeks to provide maximum possible preservation of capital and a reasonable rate of return via investing in Shariah Complaint money market and debt securities having good credit quality rating and liquidity.

12.00%

10.39%

INVESTMENT COMMITTEE
Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Syed Shahid Iqbal Mr. Imran Altaf Mr. Muhammad Asif Tahir Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Fund Manager (Fixed Income) Fund Manager (Fixed Income) Head of Compliance & Internal Audit

Returns(MoM) Benchmark

10.00%

FISGF
7.60% 7.08% 7.15% 7.22% 7.20% 7.05% 7.18% 6.54% 7.20% 6.92% 7.06% 6.39% 7.01% 6.49% 6.86% 7.00% 6.86% 5.63% 6.84% 6.78% 6.15%

5.75%

8.00% 6.00% 4.00% 2.00% 0.00%

4.46%

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Mr. Muhammad Faraz Khan Manager Risk

The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 2,991,003 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 0.423 (0.41%). For details investors are advised to read the latest financial statements for the Quarter and Nine months ended March 31, 2013.

Performance Review
During the month, your fund yielded 5.63%, while YTD return consolidated at 6.09%. Lack of CP-Sukuks and availability of high quality corporate Sukuk kept the fund devoid of high yielding assets. At the end of the month, investment in GOP Ijara Sukuk was raised up to 51%, in a bid to increase returns to a certain extent. That said, FISGF has already subscribed to upcoming CP-Sukuks and high quality corporate Sukuks (scheduled for October) to raise portfolio yield and improve returns.
MUFAPs recommended format
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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Income & Growth Fund

FUND INFORMATION
Fund Type Category Stability Rating Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark Open Ended Aggressive Income Fund A+(f) (JCRVIS) Medium October 10, 2005 CDC Ernst & Young Ford Rhodes Sidat Hyder 1.50% Nil PKR. 5,000 90% 1 Yr KIBOR and 10% average of most recent published 3month deposit rates of top 3 scheduled Commercial Bank by deposit size Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 105.80 501.13 Nil 2.24

FUND RETURNS
(Holding Period Annualized % p.a) FY14 to date Benchmark (YTD) Month-on Month Benchmark (MoM) Sep13 6.19 9.28 7.52 9.43 Aug13 5.51 9.2 5.49 9.25

ASSET ALLOCATION (% OF TOTAL ASSETS)

Others including receivables, Cash , 3.45% 17.29% TFCs, 31.38% T-Bills, 9.65% Others including receivables, Cash, 2.88% 9.80% TFCs, 29.51% T-Bills, 38.40%

Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets (PKR mn) Leverage Weighted Average Maturity (Years)

Placement with Banks and DFIs, 18.60%

PIBs, 19.64%

Sep13

Placement with Banks and DFIs, 19.41%

Aug13

ASSET QUALITY (% OF TOTAL ASSETS)

Government Securities AA+ AA AAA NR (includes receivables against Sale of Government Securities) 29.28% 0.19% 25.84% 31.05% 9.37% 4.26%

Investment Objective
Faysal Income & Growth Fund (FIGF) seeks to provide its investors with optimal yields through a diversified portfolio consisting of both long-term fixed instruments as well as shortterm money market securities.

TFC/SUKUK HOLDINGS (% OF TOTAL ASSETS)

Bank Alfalah Limited V Engro Fertilizer Limited-PRP I Askari TFC 4 Bank Al Habib Kohat Cement Sukuk
14.00%

10.01% 9.37% 7.10% 4.09% 0.81%

Returns(MoM) Benchmark FIGF
9.61% 7.50% 9.57% 8.01% 9.61% 8.62%

9.46%

9.42%

9.44% 8.32%

9.43%

9.36%

5.50%

Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Syed Shahid Iqbal Mr. Imran Altaf Mr. Muhammad Asif Tahir

Acting Head of Research Senior Portfolio Manager Fund Manager (Fixed Income) Fund Manager (Fixed Income) Head of Compliance & Internal Audit

6.00% 4.00% 2.00% 0.00%

5.19%

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Mr. Najm-Ul-Hassan

Chief Financial Officer

8.00%

6.80%

7.06%

Mr. Enamullah Khan

Chief Executive Officer

10.00%

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NON COMPLIANCE
Name of Instrument Bank Alfalah Limited Rating required N/A Existing Rating N/A Maximum Existing Exposure as Exposure as a a % of NAV % of NAV 10 10.33% Excess Exposure 0.33 Type of Instrument TFC's Value of Provision Investment (If any) before provisioning 51,128,872 Value of Investment after provision 51,128,872 % of Net Assets 10.33 % of Total Assets 10.01

The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 6,589,281 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs.1.408 (1.33%). For details investors are advised to read the latest financial statements for the the Quarter and Nine months ended March 31, 2013.

Performance Review
FIGF generated a return of 7.52% over September, allowing YTD return to clock in at 6.19%. Exposure in T-bills was reduced from 38% to 10%, with proceeds placed in longer tenor bonds to capitalize on widening differential between PIB yields and policy rate. Exposure against TFCs with good credit quality was also increased during the month in a bid to achieve higher portfolio returns in the months to come.
MUFAPs recommended format
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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9.43% 7.52%

9.15%

9.25%

INVESTMENT COMMITTEE

12.00%

9.76% 10.44%

12%

Asset Allocation Fund

FUND INFORMATION
Fund Type Category Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark* Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets (mn) Leverage Open Ended Asset Allocation Scheme Moderate to High Risk July 24, 2006 CDC Ernst & Young Ford Rhodes Sidat Hyder 2% Nil PKR. 5,000 KSE100 Index / 6M KIBOR Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 66.22 124.44 Nil

FUND RETURNS
FY14 to Date Benchmark (YTD) Month-on Month Benchmark (MoM) Sep13 (0.51) 3.24 (3.82) (0.44) Aug13 3.44 3.89 1.09 (1.64)

ASSET ALLOCATION (% OF TOTAL ASSETS)

Others, 31.15% Cash in Bank, 30.47% Equities, 24.57% Others, 4.74%

Cash in Bank, 70.69%

Equities, 38.38%

Sep13

Aug13

* weighted average of 6M KIBOR & percentage invested in equities

SECTOR ALLOCATIONS (% OF TOTAL ASSETS)

Chemicals Industrial Transportation Electricity Commercial Banks Others Sep13 21.65% 6.46% 6.34% 3.93% 0.00% Aug13 24.57% 0.00% 0.00% 0.00% 0.00%

Investment Objective
Faysal Asset Allocation Fund (FAAF) endeavors to provide investors with an opportunity to earn long-term capital appreciation optimizing through broad mix of asset classes encompassing equity, fixed income & money market instruments.

EQUITY HOLDINGS (% OF TOTAL ASSETS)

ICI Pakistan Limited Pakistan International Airlines Pakgen Power Limited Habib Bank Limited Japan Power Generation 21.65% 6.46% 5.95% 3.93% 0.39%

INVESTMENT COMMITTEE
Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Muhammad Raheel Mr. Muhammad Asif Tahir Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Acting Fund Manager Head of Compliance & Internal Audit

ASSET QUALITY (% OF TOTAL ASSETS)

AA+ AA AANR (includes equity investments) 0.19% 8.08% 22.20% 69.53%

Mr. Muhammad Faraz Khan Manager Risk

NON COMPLIANCE
Name of Instrument Trust Investment Bank ICI Pakistan Limited Rating Existing Maximum Existing required Rating Exposure as a Exposure as a % of NAV % of NAV BBB N/A D N/A 10% 10% 0.00% 23.61% Excess Exposure 13.61% Type of Instrument TFC Equity Shares Value of Investment before provisioning 13,137,042 29,384,850 Provision (If any) 13,137,042 Value of Investment after provision 29,384,850 % of Net Assets 23.61% % of Total Assets 21.65%

The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 2,249,330 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 1.197 (1.81%). For details investors are advised to read the latest financial statements for the Quarter and Nine months ended March 31, 2013.

Performance Review
Your fund posted a return of -3.82% over the month of September on account of the fall in the broader KSE-100 index. Exposure to equities was increased initially owing to positive development at the start of the month when entry into the IMF program provided much needed stability. However, +50bps hike in discount rate, Pak Rupee depreciation and rise in saving deposit rates subsequently dampened investor sentiments. Going forward, your fund shall continue to proactively regulate exposure between equities and fixed income avenues to stave off systematic and unsystematic risks.

MUFAPs recommended format

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.

Balanced Growth Fund

FUND INFORMATION
Fund Type Category Risk Profile Launch Date Custodian/Trustee Auditor Management Fee Front/Back end Load Min Subscription Benchmark* Pricing Mechanism Dealing Days Cut-Off Timing AMC Rating NAV per Unit (PKR) Net Assets (mn) Leverage Open Ended Balanced Scheme Moderate April 19, 2004 CDC M.Yousuf Adil Saleem & Co. 2% Nil PKR. 5,000 KSE100 Index / 6M KIBOR Forward Monday-Friday 9:00 am - 5:00 pm AM3+ (JCRVIS) 59.51 100.68 Nil

FUND RETURNS
FY14 to Date Benchmark (YTD) Month-on Month Benchmark (MoM) Sep13 (1.44) 2.91 (1.49) 0.15 Aug13 0.05 3.21 -1.69 -1.27

ASSET ALLOCATION (% OF TOTAL ASSETS)

Others, 27.24% Cash , 21.69% Others, 13.19% Cash, 13.10%

Preference Shares, 33.19%

Stocks/ Equities 17.88%

Preference Shares, 44.90%

Stocks/ Equities 28.81%

Sep13

Aug13

* weighted average of 6M KIBOR & percentage invested in Equities

SECTOR ALLOCATIONS (% OF TOTAL ASSETS)

Chemicals Commercial Banks Fixed Line Telecommunication Technology Hardware & Equipment Travel & Leisure Others Sep13 7.73% 4.72% 2.32% 1.55% 1.26% 0.30% Aug13 20.77% 0.00% 0.00% 2.21% 0.00% 5.83%

Investment Objective
Faysal Balanced Growth Fund (FBGF) endeavors to provide investors with an opportunity to earn income and long-term capital appreciation by investing in a large pool of funds representing equity / non equity investments in a broad range of sectors and financial instruments.

EQUITY HOLDINGS (% OF TOTAL ASSETS) INVESTMENT COMMITTEE

Mr. Enamullah Khan Mr. Najm-Ul-Hassan Mr. Ayub Khuhro Mr. Vasseh Ahmed Mr. Muhammad Raheel Mr. Muhammad Asif Tahir Chief Executive Officer Chief Financial Officer Acting Head of Research Senior Portfolio Manager Acting Fund Manager Head of Compliance & Internal Audit ICI Pakistan Limited Habib Bank Limited Pakistan Telecommunication Company Limited TPL Trakker Limited Pakistan International Airlines D.G. Khan Cement 7.73% 4.72% 2.32% 1.55% 1.26% 0.30%

ASSET QUALITY (% OF TOTAL ASSETS)

AA+ AA AANR(includes equity investments) 0.02% 2.17% 19.51% 78.31%

Mr. Muhammad Faraz Khan Manager Risk

NON COMPLIANCE
Name of Instrument Pak Electron Limited* Pak Electron Limited (Sector) Pak Electron Limited (Group) Listed Equity Securities Rating Existing Required Rating AN/A N/A N/A Withdrawn N/A N/A N/A Maximum Existing Excess/Short Type of Exposure as Exposure Exposure Instrument a% of NAV as a% of NAV Preference 10% 37.24% 27.24% Shares Preference 25% 37.24% 12.24% Shares Preference 35% 37.24% 2.24% Shares Equity 30% to 70% 20.06% 9.94% Shares Value of Provision Value of Investment before if any Investment after provisioning provisioning 37,490,000 37,490,000 37,490,000 20,194,860 37,490,000 37,490,000 37,490,000 20,194,860 % of Net Assets 37.24% 37.24% 37.24% 20.06% % of Total Assets 33.19% 33.19% 33.19% 17.88%

*SECP had granted extension to regularize this exposure till December 31, 2013

The Scheme has maintained provisions against Workers' Welfare Fund liability to the tune of Rs. 4,661,795 as at September 30, 2013. If the same were not made the NAV per unit / return of the Scheme would have been higher by Rs. 0.846 (1.42%). For details investors are advised to read the latest financial statements for the Quarter and Nine months ended March 31, 2013.

Performance Review
Owing to fall in the broader KSE-100 index, your fund posted a return of -1.49% over August. Equity exposure was curtailed from 30% to 21% on account of +50bps hike in discount rate, Pak Rupee depreciation, projected rise in inflation and anticipation of further monetary contraction. Going forward, investments shall be regulated in accordance with economic developments and investment sentiments.

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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.