It is often said that one man’s meat is another man’s poison. While many have been or are being hurt by the falling Naira, it does look like there is one group of investors or an investment class or type that has benefited from the free for all fall in the value of the Naira.
Analysis from Quantitative Financial Analytics is indicating that the falling Naira has propelled Nigerian Euro Bond funds onto the forefront of high performers in the Mutual fund industry.
According to the analysis, the first 7 best performing mutual funds in the second quarter of 2021, (on a year-to-date basis) is made up of 4 Euro Bond Funds. Here is a list of the 7 best performing mutual funds for H1 2021.
7th Best Performing Fund:
Name of Fund: FBN Nigeria Eurobond USD Fund (Retails)
YTD Performance %: 6.95%
YTD Gain per unit: N3429.06
6th Best Performing Fund:
Name of Fund: FBN Nigeria Eurobond USD Fund (Institutional)
YTD Performance %: 6.96%
YTD Gain per unit: N3430.47
5th Best Performing Fund:
Name of Fund: Legacy USD Bond Fund
YTD Performance %: 7.95%
YTD Gain per unit: N30.16
4th Best Performing Fund:
Name of Fund: Zenith Equity Fund
YTD Performance %: 8%
YTD Gain per unit: N0.96
3rd Best Performing Fund:
Name of Fund: Vantage Dollar Fund
YTD Performance %: 9.02%
YTD Gain per unit: N45.37
2nd Best Performing Fund:
Name of Fund: ARM Ethical Fund
YTD Performance %: 10.40%
YTD Gain per unit: N3.69
Best Performing Fund (1st):
Name of Fund: Alpha ETF
YTD Performance %: 18.31%
YTD Gain per unit: N18.31
What this means to you
The implication of this is that Eurobonds and Dollar funds could be good investment outlets for currency hedge. In that case, those who are concerned about the effect of the dwindling value of the Naira on their mutual fund investments can reallocate their resources or assets more to dollars.
This, however, is not investment advice and should not be treated as such.
