Beltone has opened Fadda, Egypt’s first silver investment fund, to subscription starting today, expanding its precious metals offering as volatility sweeps global markets. We sat down with Khalil El Bawab, CEO for local and regional markets at Beltone Holding, to unpack how the fund works, why now, and how it fits into Beltone’s broader push to build a full-spectrum asset management platform.

Key Takeaways:

  • Beltone is positioning its silver fund as a medium- to long-term allocation tool, urging investors to enter gradually rather than trade short-term volatility.
  • The fund invests directly in physical silver held in custody and is co-sponsored by Evolve, Beltone’s partner in a gold fund launched two years ago that now has EGP 3.6 bn worth of AUM;
  • Beltone has at least five other funds in the pipeline set to launch between 2Q and 3Q this year;
  • The firm is preparing to launch a digital wealth management platform in 2H that will handle onboarding, risk profiling, and portfolio allocation end-to-end;
  • A REIT could be on the menu for the second half of this year.

EnterpriseAM: Precious metals have been on a rollercoaster in recent months. Why silver and why now?

Khalil El Bawab: In extraordinary times, anybody who would tell you a direction wouldn’t be solid… It is quite volatile. That’s why I’m urging clients to incrementally invest in the fund. This is a medium to long-term investment — not a fund for trading. The fund offers physical delivery, so there is a cost that you're already incurring. This would be covered by staying invested for a longer period.

We’ve been studying this product for nearly two years, since the launch of the gold fund. Previously, high bid-offer spreads, placement fees, and custody costs — driven by silver’s lower value relative to gold — made the product less viable. Over the past two years, we worked with service providers to address these challenges, enabling the launch we are announcing today.

EnterpriseAM: What’s your pitch to investors?

KB: It’s part of a diversification plan of your investment portfolio, even if silver is a little bit more volatile. Normally, with silver, you need to transact in cash. For a fund, you don’t need to transact in cash. It is regulated. It is secure. Custody is offered. You also have insurance on the movement of silver, and we ensure everything is up to international standards. You’re not taking on that risk, and you get it at minimal cost. Investors holding silver equivalent to at least 10 kg can request delivery.

This is not an ETF, as the market still lacks sufficient depth. The fund maintains a minimum exposure of 80% and a maximum of 95% to silver, allowing flexibility in portfolio management.

EnterpriseAM: How is it regulated?

KB: Oversight includes an independent supervisory committee, Financial Regulatory Authority regulation, service providers supplying the metals, a fund administrator handling IC pricing and operations, and professional asset managers.

EnterpriseAM: There is a historical perception that gold and silver move together. Why should I, as an investor, diversify between gold and silver?

KB: It is still true … that correlation is going to prevail in my humble opinion. But still silver is still lagging. Because in that perspective, it has more commercial uses than gold. Gold is usually more of a safe haven, inflation protection. Silver is a precious metal but has other commercial usage, so it adds another flavor.

EnterpriseAM: How does the silver fund fit in your wider asset management strategy?

KB: Our long-term strategy is to build a full suite of products across money market funds, fixed income, equities, both passive and active, as well as sector-specific and thematic funds. Our focus has been on filling product gaps. We now offer a full spectrum across low-, medium-, and high-risk products, both conventional and Sharia-compliant.

We’ve issued 14 funds over the past two and a half years. Alongside Beltone-branded funds, we also manage third-party funds for banks and insurance companies. Building our mutual funds platform has been a core part of a strategy we launched nearly three years ago.

EnterpriseAM: What’s next?

KB: The wealth management platform we plan to launch in the second half of this year will be built on these funds.

The process will be fully digital: onboarding clients, conducting risk assessments, defining investment objectives, and generating suggested asset allocations. Clients can then invest through lump sums or periodic contributions, monthly, quarterly, semi-annually, or annually, depending on their goals. These plans could be tailored for education, marriage, travel, or retirement.

We have at least five more funds in the pipeline set to launch between 2Q and 3Q this year, completing our product suite. We’re the asset manager offering index trackers for every index in the market, and we are also the only issuer of an ETF on the EGX30, providing full market exposure.

We are also exploring launching a real estate investment trust (REIT) in the second half of this year.

EnterpriseAM: Could we see the launch of funds for other metals in the Egyptian market, such as copper?

KB: Well, I wouldn’t be surprised. Two years ago, I didn’t see a viable silver fund … the bid-offer spread and the cost was around 15%. This was crazy as a spread. When we saw it going down … it dropped to 4.25%. I wouldn’t rule out another precious metal, but there’s a learning curve. There is growth in the market. The market is evolving.

We’re trying to push the market to the limit… I wouldn’t be surprised that at a certain point in time we would be seeing gold receipts being traded on the stock exchange — gold or silver or other metals.

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