Shuaa Capital, the biggest independent fund manager in the Middle East, based in Dubai with more than $3bn of assets under management, manages the Arab Gateway fund which is available to UK investors.The outlook for the region is still outstanding, with markets such as Kuwait, Oman and Egypt still substantially undervalued. The long-term outlook for oil prices remains fairly steady and a big construction boom is fuelling long-term economic benefits in the Middle East. The outlook for this fund should be excellent. Since Shuaa Capital took over its management in February 2001, the fund has risen by over 270 per cent against a rise in the MSCI Emerging Markets index of 91 per cent. At the moment, 37 per cent of the fund is invested in Kuwaiti shares, 21 per cent in Egypt, 9 per cent in Lebanon, 8 per cent in Qatar and 5 per cent in Oman, with cash and others accounting for the balance. The sectors that Shuaa Capital likes particularly are banking and finance (37 per cent), telecoms (18 per cent), services (around 9 per cent), manufacturing (8 per cent) and construction and real estate (7 per cent). These are very different holdings from the Arab/ GCC index itself. Minimum investment in the fund is currently $100,000 but negotiations are going forward with some of the networks so it may be possible for smaller investors to take advantage of this fund, too. It should certainly be part of big portfolios.