Stanbic IBTC drives awareness for investment in mutual funds
Stanbic IBTC Asset Management Limited, a subsidiary of Stanbic IBTC Holdings Plc, has unveiled an initiative to educate and empower Nigerians by launching a multi-media nationwide Investor Education Campaign to improve penetration and awareness of mutual funds. The company said the initiative is specifically aimed at publicizing the unique benefits of mutual funds, while demystifying the erroneous impression that investment of this nature is reserved only for the wealthy.
The Chief Executive Officer of Stanbic IBTC Asset Management Limited, Mr. Olumide Oyetan stated that there are numerous benefits associated with investing in mutual funds one of which is the professional management of investors’ money. He specified that Stanbic IBTC’s experience and expertise are based on in-depth research that identifies unique opportunities designed to deliver on reasonable and consistent superior returns without taking undue risk.
The concept of buying mutual funds allows investors to sit back, relax and outsource the management of their money to professionals portfolio managers. The portfolio managers or fund managers then channel the money into investments in the appropriate assets class selected by the investor based on their investment objective, time horizon and tolerance of risk. Some of the traditional asset classes that mutual funds invest in include Money Market, Bonds, Public and Private Equity e.t.c. Put simply, a mutual fund is a pool of money provided by individual investors, companies and other organizations. A fund manager is hired to invest the cash the investors have contributed. Instead of buying individual shares, investors are buying shares of mutual funds. The fund manager invests the pooled money in certain specified types of assets such as common stocks and bonds, among others. The funds issued to investors entitle them to a certain percentage of the income generated by these assets.
Similar to the way a Co-operative scheme or the local Thrift club, Esusu, Adashe or Ajo system is operated a mutual fund is like an arrangement that brings together money from many people and invests it in purely or a combination of money market, equities, bonds or other assets.
The campaign by Stanbic IBTC Asset Management will feature educative and informative articles on mutual funds across different media channels, depicting varied features that the asset class offers, its major aim being to encourage much more Nigerians invest in mutual funds.
Stanbic IBTC Asset Management offers a selection of 8 mutual funds with assets under management in excess of N50 billion. Stanbic IBTC Money Market Fund (SIMM) for instance, is ideal for individuals wishing to invest for short term purposes in other to maximize return. The product also caters for investors with low risk appetite i.e. risk that the value of your money may diminish in the short term due to the performance of the financial markets. SIMM caters for investors with low risk appetite who want little or no exposure to the capital market but require the liquidity and competitive returns available in fixed income markets. SIMM invests 100% of its asset in quality money market instruments including Treasury Bills, Commercial Papers, Bankers’ Acceptances and Fixed Deposits with banks that are rated by independent SEC registered organizations.
SIMM has an ‘Aa(f)’ fund risk rating by Agusto & Co; a rating it has retained for the third year in a row. This is the highest rate to be conferred on a fund managed in Nigeria by the reputable rating agency. Funds rated ‘Aa(f)’ are deemed to have minimal to low exposure to downside risk (financial risk associated with losses) in the medium term. This means that SIMM is safe and suitable for investors who are concerned about market risk.
SIMM was put together to cater for individuals and corporate organizations who desire a pro-active cash management solution that provides access to the most competitive interest rate available in the money market at any given time while permitting unrestricted access after investing for 30 days or more.
With an initial minimum investment amount of N50,000, you derive the benefit of pooling other investors money to attract the most competitive interest rates available on sums in excess of N100 million that was hereto only available to big investors or institutions like if it was N500 million therefore achieve higher returns ordinarily available only to “institutional” investors.
As industry leaders, Olumide stated that Stanbic IBTC Asset Management has a responsibility to help enhance awareness about mutual funds so as to enable Nigerians benefit from the opportunities derivable from investing in such instruments. “Stanbic IBTC’s expertise and experience in Asset and Wealth Management as well as Corporate and Investment Banking garnered over many years, in addition to Standard Bank’s rich heritage are pivotal in guiding investment decisions thereby ensuring that investors derive value from their investments” he added.
Other mutual funds currently managed by Stanbic IBTC Asset Management include Stanbic IBTC Nigerian Equity Fund; our flagship fund, Stanbic IBTC Ethical Fund; Nigeria’s first socially responsible quoted mutual fund which allows subscribers to make profitable long-term investments without compromising their religious beliefs and/or principles, Stanbic IBTC Guaranteed Investment Fund; a mutual fund that guarantees principal of investments after holding the instrument for a minimum of three months, Stanbic IBTC Balanced Fund; which allows investors benefit from a balanced combination of equities and fixed income assets, Stanbic IBTC Bond Fund; which provides easy unrestricted access to Nigeria’s rapidly developing bond market, Stanbic IBTC Umbrella which consists of several distinct sub funds namely the Aggressive Fund, the Conservative Fund and the Absolute Return Fund which are traded as individual investment funds. The umbrella fund structure enables investors to invest in any one or a combination of the various sub-funds towards achieving their investment objectives and most recently the Stanbic IBTC Imaan Fund which is an investment where funds are invested only in businesses with high moral values. It’s for people with high ethical standard that conforms to their religious belief in some instance though open to the general public to invest in. The funds are invested in sharia compliant equity and non-interest bearing fixed income securities. It is very convenient and offers capital appreciation with long term returns but avoids investment in banks, insurance companies and companies with high debt ratio.
Stanbic IBTC Asset Management Limited is a wholly-owned subsidiary of Stanbic IBTC Holdings Plc, while Stanbic IBTC Holdings Plc is part of the Standard Bank Group, Africa’s largest bank by assets. Standard Bank Group has been in operation for 151 years and has direct, on-the-ground representation in 20 African countries. Stanbic IBTC Holdings Plc provides the full spectrum of financial services with a clear focus on three main business pillars – Corporate and Investment Banking, Personal and Business Banking and Wealth Management.
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