A Unit Trust fund is a collective investment scheme that pools money together from many investors who share the same financial objective, to be managed by a group of professional managers who invest the pooled money in investments such as shares, bonds and other investments. Collective Investment Schemes are arrangements made or offered by a company under which the contributions or payments made by the investors are pooled and invested to receive profits, income, produce or the property, and the pool is managed on behalf of the investors by a professional manager. The manager uses the money to buy stocks, bonds, or other securities according to specific investment objectives that have been established for the pool.
In other words, a collective investment scheme such as a unit trust is simply a Chama that pays a fee to a professional to
manage the money they contribute and distribute the returns
A money market fund is a type of unit trusts that invests in low-risk investments with an element of guaranteed return such as fixed deposit accounts, treasury bills, and commercial bonds (such as Centum bonds). This type of fund usually invests in money market instruments with a maturity of less than one year.
Money market funds are often regarded as being as safe as
bank deposits yet providing a higher yield. They usually pay out interest on a
monthly basis, rather than annually, as bank savings accounts do. They take the
money they have received over the course of a month, invest it, then calculate
how much return they managed to get over the course of the month. Over the last
12 months, the best-performing money market funds have been able to generate up
to 12% per year in interest, compared with 7% from bank savings.
A money market fund is a great place to put your savings - either emergency savings or while saving for something, such as a car or house.
They are a low-risk, high liquidity method to grow your
money. Low risk means you can’t lose the principal amount you put in and your
money grows every month. The only risk I see is if the fund collapsed with your
money. High liquidity means you can get your money back quickly when you need
it (within three working days).
You earn compound interest, not simple interest. So the interest you earn is added to your principal each month and then that new
principal earns more interest. Simple interest is calculated on the principal
alone, but compound interest is calculated on the principal and interest
earned.
Your money is invested by professionals to ensure maximum return and low risk.
You can top up at any time, unlike with a fixed deposit account at a bank where you can’t top up anytime.
On our Web Platform
Select "Buy and Sell"
Select "Order Type" as Buy/Deposit
Select a Fund. Currently, we have Old Mutual and Sanlam
Money Market Funds available. Other funds will be added soon.
Add the amount you would like to invest in. The minimum for
Sanlam is KES 2,500, for Old Mutual is KES 1,000. You will need to have
deposited the money via the options available to you on the
"Deposits" page under your "Investment Account" tab.
Select how you would like the interest treated. You can have
it deposited into your Abacus account or reinvested in the fund you have
selected.
The interest earned will be updated on your statement
available under your portfolio.
To withdraw, click on "Sell/Withdraw", select your fund, enter the amount and submit.
Please allow up to 48 hours for processing.