Mutual Funds are professionally managed investment schemes controlled by an Asset Management Company (AMC), that gives investors opportunity to invest in bonds, stocks, and securities. They are especially great for passive investors.
According to data from the Security and Exchange Commission (SEC), Nigeria currently has about 110 Mutual Funds, cut across several Fund Types. Here is a breakdown of the Fund Types available for investors according to SEC.
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|MONEY MARKET FUNDS||23|
|FIXED INCOME FUNDS||22|
|EQUITY BASED FUNDS||13|
|EXCHANGE TRADED FUNDS||10|
|REAL ESTATE FUNDS||3|
To determine the best performing funds, we looked at the Fund Prices as of the last business day in July 2020, and compare it to the fund prices as of the last trading day of August 2020. These are the top 5. We also included profiles of the funds, as described in their websites.
These are the best mutual funds in Nigeria to invest in, based on their performances in August.
Valualliance Value Fund
The Valualliance Value Fund (Value Fund), is a closed-end collective investment scheme, registered and regulated by the Securities and Exchange Commission, whose units are listed on the main board of the Nigerian Stock Exchange (NSE). The Value Fund commenced operations on the 30th of June 2011, raising the sum of N3.2bn through an Initial Public Offer. It was formerly known as “SIM Capital Alliance Value Fund”.
Fund Price – N103.2
Fund Price – N115.05
Return – 11.48%
Ranking – First
Commentary: Valualliance value fund, by ValuAlliance Asset Managers, is the best performing fund in the month of August. The mixed fund grew by 11.48%, from N103.2 to N115.1, as at the end of August 2020, while the net value asset stood at N4.73 billion.
Cordros Milestone Fund 2028 & 2023
The Cordros Milestone Fund 2028 and 2023, are target-date mutual funds which start out investing in a mix of securities (asset allocation), that seeks capital growth (e.g. stocks), and gradually shifts to those that seek capital preservation (e.g. money market), as the target dates (2028 & 2023) draws near.
Target date funds, which are also called lifecycle funds, are designed to offer a convenient way to invest through a portfolio of assets. The funds are open-ended funds, constituted under a Trust Deed and the units shall then be continuously offered. Cordros Milestone Fund 2028 and 2023, grew by 9.28% and 7.27% respectively.
July 29th (Cordros Milestone Fund 2028)
Fund Price – N100.21
Fund Price – N109.51
Return – 9.28%
Ranking – Second
July 29th (Cordros Milestone Fund 2023)
Fund Price – N98.35
Fund Price – N105.50
Return – 7.27%
Ranking – Third
Commentary: This is a mixed fund owned by Cordros Asset Management. The minimum initial investment is 35 units, while additional investments thereafter shall be 10 units. The managers only operate four funds, which also includes a money market fund and a dollar fund.
Cordros Dollar Fund
The Cordros Dollar Fund, is a mutual fund that allows you to conveniently invest and earn returns in US Dollars. The fund invests in US Dollar-denominated securities like Sovereign Eurobonds, Corporate Eurobonds, Money Market instruments, and other quoted Corporate Eurobonds. The objective is to offer you competitive returns than is obtainable from an average domiciliary bank account.
Fund Price – N36,498.27
Fund Price – N38,986.04
Return – 6.82%
Ranking – Fourth
Commentary: The Cordros Dollar Fund, is the best performing mutual fund, if you are looking for dollar-denominated fixed-income debt securities, such as Eurobonds. Cordros Dollar fund is the third fund from the managers that made it to the best funds in the month of August.
The Vetiva Consumer ETF ‘VETGOODS ETF’, launched in 2015, is an open-ended Exchange Traded Fund managed by Vetiva Fund Managers Limited. The VETGOODS ETF, is designed to track the performance of the constituent companies of the NSE Consumer Goods Index, and to replicate the price and yield performance of the Index.
The NSE Consumer Goods Index comprises of the top 15 companies in the Food/Beverages and Tobacco sector listed on the Nigerian Stock Exchange (NSE), in terms of market capitalization and liquidity, and is a price index weighted by adjusted market capitalization.
Fund Price – N4.02
Fund Price – N4.27
Return – 6.22%
Ranking – Fifth
Commentary: This is one of Vetiva’s products, and the best Exchange traded fund, growing by 6.22%. Vetiva have a number of ETF funds, three of which recorded positive growth, while the remaining two declined in the month. Hence, if you are interested in an exchange traded fund, this is the best performing in the month of August.
Bubbling Under: The following funds make up the rest of the top 10 on our list, presented in descending order.
- PACAM EquityFund (5.45%)
7. Legacy USD Bond Fund (5.27%)
8. Vantage Equity Income Fund (5.15%)
9. VETBANK ETF (5.02%)
10. Legacy Equity Fund (4.5%)