BusinessMutual Funds Record N1.6tn Asset In 2020

Mutual Funds Record N1.6tn Asset In 2020

BEVERLY HILLS, May 10, (THEWILL) – The Mutual Fund Industry made a progressive impact on the economy in 2020, garnering a total asset of N1.6 trillion, a 50 percent increment from the previous year.

The growth recorded is only 14 per cent of the size of the much larger Pension Fund Industry.

Head, Research, Coronation Asset Management Mutual Funds, Guy Czartoryski, gave the figure on Monday, informing that last year was a good year for mutual funds despite the outbreak of the COVID-19 pandemic.

In his welcome address, Managing Director of Coronation Asset Management Mutual Funds, Aigbovbioise Aig-Imoukhuede, affirmed that there was financial growth in the Mutual Funds Industry.

Declaring that the industry grew by 50 percent, despite COVID-19, Aigbovbioise insisted that Nigeria needed a standard form of reporting.

Speaking at a virtual media Briefing on Coronation Asset Management Mutual Funds Report, titled, “Comparing Mutual Funds: Apples and Oranges; Why Harmonised Reporting Is The Next Step Forward,” Czartoryski said: “Last year, market interest rates fell precipitously, with the yield on a one-year Nigerian Treasury Bill (NTB) falling from 5.40% in January 2020 to 0.15% in early December 2020. It was difficult for investors to get good rates of interest from their bank deposits.”

According to him, initially investors turned to money market funds, which WEre the biggest segment of the Mutual Fund industry.

Later on, Czartoryski noted that they turned to fixed income funds because some of these were reporting good unit price gains during the year as interest rates fell and bond prices rose.

“This attracted a lot of money into the Mutual Fund industry and its total assets under management rose by 50% to N1.6 trillion. In general, there is a long-term move from bank deposits to Mutual Funds because Mutual Funds deliver all their gains, less a small fee, to their investors, and investors are beginning to appreciate that,” Czartoryski.

Explaining further, Czartoryski said that they went through the experience of an ordinary investor looking to buy units in a Fixed Income Fund, adding, “We compared the reported Unit Price (UP) performance of 17 different Fixed Income Funds during 2020,even though past performance is not necessary a guide to future performance.”

About the Author

Homepage | Recent Posts

More like this
Related

Easter: Tinubu Felicitates With Christians, Says Nigeria Will Triumph Over Challenges

March 29, (THEWILL) - President Bola Tinubu has...

Ankle Setback Sidelines Murray From Monte Carlo, Munich Tournaments

March 29, (THEWILL) - British tennis star, Andy...

Third Mainland Bridge To Fully Open In Seven Days – FG

March 29, (THEWILL) - The Federal Government, through...