IFS Capital’s funds make gains

All the three funds managed by IFS Capital Management Limited has recorded good results for the year 2016.

The funds: ‘My Wealth Unit Trust Fund’, ‘Legacy Unit Trust Fund’ and the ‘Richie Rich Unit Trust Fund’ all recorded growth in the year under review.

The ‘My Wealth Unit Trust’ which is an open-ended balanced fund returned an impressive yield of 25.43 per cent over the 2015 return of 14.69 per cent.

The ‘Legacy Unit Trust’, which is also an open ended income fund also recorded a yield of 22.17 per cent over the 2015 return of 13.73 per cent, while the ‘Richie Rich Unit Trust’ also recorded an annual yield of 26.05 per cent over the 2015 return of 14.78 per cent.

These came to light when the IFS Capital Management Limited held its annual general meeting for the three funds in Accra.

‘My Wealth Unit Trust Fund’

The fund’s assets grew from GH¢ 841,319 in 2015 to GH¢ 1.04 million in 2016, representing a 27.66 per cent growth, while its net income from operations also increased from GH¢153,416 in 2015 to GH¢227,937 as at the end of 2016.

The Chief Executive Officer (CEO) of IFS Capital Management Limited, Mr Kojo Ohene Kyei said its assets were mainly invested in short-term securities and listed equities.

He said the fund was able to achieve the remarkable results despite the unimpressive performance of the Ghana Stock Exchange (GSE) over the period.

The GSE composite index returned a negative year-to-year date of 15.33 per cent.

The CEO said the fund was mainly dominated by money market investments accounting for over 80 per cent of the entire portfolio, followed by equities which was 8.91 per cent.

“Although it is a balanced fund, the exposure to shares was reduced due to the poor performance of shares of the stock market as we took advantage of money market instruments which were providing better returns,” he stated.

Touching on the way forward, he said the market in 2017 was expected to bounce back from its sluggish performance to an overall bullish market.

“The proposed reduction of corporate taxes from 25 per cent to 20 per cent when implemented is also expected to boost companies bottom lines and this will affect investor decisions and interest rates on the financial markets so your fund manager will continue to monitor such factors and rebalance the fund’s position in both equities and money market instruments for the benefit of unit holder,” he noted.

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‘Legacy Unit Trust Fund’

The net assets of the fund increased from GH¢ 531,588 in 2015 to GH¢ 692,848 in 2016, representing an increase of 30.33 per cent. The number of unit holders, however, shrunk marginally to 164 from 167 unit holders.

Mr Ohene Kyei said the fund held positions in shares and the significant drop in the prices of the shares held by CAL Bank, GCB Bank, and Total in 2016 affected the performance of the fund.

Notwithstanding, the fund, however, recorded a yield of 22.17 per cent over the 2015 return of 13.73 per cent.

As an income fund, he said the fund’s structure was mainly dominated by money market investments totaling 78.96 per cent of the entire portfolio, followed by equities  at 15.22 per cent.

He said the relatively small equity holdings was because it further reduced the equity holdings from the 2015 position of 23.37 per cent due to poor performance of equities on the GSE in 2016.

“However, returns from the money market cushioned the fund to increase its return from 13.73 per cent in 2015 to 22.17 per cent in 2016 despite the impact of negative returns on the stock market,” he indicated.

‘Richie Rich Unit Trust’

The fund which seeks to encourage children to start investing at a tender age also recorded a yield of 26.05 per cent, thereby, outperforming both the 91-day and 182-day Treasury bills which were at 16.43 per cent and 17.63 per cent respectively.

Net investment income for the fund grew significantly ending the year at GH¢ 80, 069, representing a 40 per cent growth over 2015’s performance of GH¢47,818.

Its Assets Under Management (AUM) also increased from GH¢303,941 to GH¢480,222, representing 40 per cent growth, while the number of unit holders also increased from 271 to 325, representing a 15 per cent growth in the client base.