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Market Commentary
Key Features
Fund Manager | CIC Asset Management Ltd |
Launch Date | Jun - 11 |
Risk Profile | Moderate |
Trustee | Kenya Commercial Bank |
Custodian | Co-op Custodial Services |
Auditors | PWC |
Minimum Investment | Ksh 5,000.00 |
Minimum Additional Investment | Ksh 1,000.00 |
Initial Fee | 0% |
Annual Management Fee | 2.00% |
Distribution | Semi-Annual |
Asset Under Management | KES 121 Million |
Fund Objective
Medium to long-term investments
Extra returns at moderate risk.
Reasonable return from a well-diversified portfolio of fixed income securities.
Asset Allocation
Maturity Profile
GDP
Real GDP expanded by 5.0 per cent in 1Q24 compared to 5.3% in 1Q23 (vs 5.5% in 4Q23). The positive growth was primarily notable in the
Agriculture sector +6.1%y/y on increased tea, milk, sugarcane production, though weighed by lower coffee and flower exports. Notable growth was also noted in real estate +6.6%y/y, financial and insurance services +7.0%y/y, ICT +7.8%y/y, accommodation and food services +28.0%y/y.
Inflation
Inflation decelerated, hitting a near 4-year low, due to slower growth in food and fuel prices. June inflation print came in at 4.6% compared to a restated 5.0% in May. 1H24 inflation averaged 5.6% vs 8.5% in 1H23. We anticipate the annual inflation rate to oscillate within the mid-point (5.0%) of CBK’s target range supported by the declining food and fuel inflation.
Interest Rates
Relative price stability combined with fairly decent economic growth prospects prompted the MPC to retain the Central bank rate at 13%. The increase in short-term papers has been somewhat moderate, with the 91, 182 and 365 day papers closing the first half of the 2024 at 15.98%, 16.76% and 16.79% respectively.
Outlook
The fund is poised to continue taking advantage of the elevated interest rate regime to provide investors with returns that beat benchmarks as it has done historically. An improved performance is expected for the fund as new in-flows and maturities come in which will be reinvested at higher yields in the current interest rate environment. The fund provides an opportunity for investors with low liquidity needs to lock in higher returns.
Fund
Performance
Nairobi Security Exchange
yield curve
Statutory Disclaimer: The value of units may go down as well as up and past performance is not necessarily a guide to the future. There are no guarantee on the client’s capital as the performance of units in the fund is determined by change in the value of underlying investments hence value of your unit trust investment
