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Market Commentary
Key Features
Fund Manager | CIC Asset Management Ltd |
Launch Date | May - 18 |
Risk Profile | Low - Moderate |
Trustee | Kenya Commercial Bank |
Custodian | Co-op Custodial Services |
Auditors | Kirenge & Associates |
Fund Objective
The fund provides a solution to organizations that find setting up a Retirement Fund and continuously comply-ing with the complex legal and statutory demands a challenge in both monetary and human resource cost.
SMEs and start-up organizations.
Fund Outlook
Global risks continue negatively affecting our stock market, and coupled with the interest rate hikes in de-veloped economies, foreign exits have sustained. The low prices in the market continue to provide attrac-tive price points into stocks with strong fundamentals and perpetual dividend payout thus locking in good yields.The government continues relying on the domestic debt market to meets is deficit owing to expensive external debt financing. Rates on government securities are hence expected to continue increasing in the near term.The fund will continue being affected by the downturn in the stock market but the bond performance will support stable performance.The fund will continue being affected by the downturn in the stock market but the bond performance will support stable performance.
Asset Allocation
GDP
In Q2 2023, economic activity grew 5.4% with positive effects from a recovery in the agricultural sector and tourism receipts. CBK projections show that Kenya’s annual real GDP growth is expected to come in at 5.5% in 2023.
Inflation
Inflationary pressures have eased on the back of declining food inflation, non-food non-fuel (NFNF) inflation remained stable in Q3, reflecting muted demand pressures in the economy.
Equities
The NSE-20 and NASI declined by 4.2% and 11% respectively led by sell off in blue-chip counters such as KCB Bank, Equity Bank and Safaricom. Overall, investor risk appetite remains muted due to the tough macroeconomic environment and high interest rates in the money markets.
Exchange Rates
Interest Rates
In 3Q23, yield curve inverted with the 2-year bonds increasing by a cumulative 5.93%, the 10-year by 1.89% and the 20-year by 1.99% y/y.
Fund Performance
Statutory Disclaimer: The value of units may go down as well as up and past performance is not necessarily a guide to the future. There are no guarantee on the client’s capital as the performance of units in the fund is determined by change in the value of underlying investments hence value of your unit trust investment
