Investors in Kenya stashed their funds in mutual funds in 2020 due to the uncertainty caused by the covid19 pandemic. As a result, assets held in Kenyan Mutual Funds grew by 37% (YoY) to KSh 98 billion in the third quarter of 2020, from KSh 71.4 billion in the same period in 2019 according to a report by the Capital Markets Authority. The assets held by Kenyan fund managers grew by KSh9.9 billion in the three months from 30th June to 30th September 2020.
CIC Unit Trust, Britam Unit Trust, and ICEA Unit Trust remained the top fund managers in terms of assets under management with KSh40.5 billion, KSh11.3 billion, and KSh10.6 billion respectively assets under management at the end of September 2020.
Wanafunzi Investments Fund, the only fund that targets students in Kenya, registered the highest percentage growth of 317% in the third quarter of 2020. The fund grew to KSh672,627 from KSh161,359 the previous quarter, showing increased interest in mutual fund investments by youths in Kenya.
Genghis Unit Trust, African Alliance Unit Trust, and Equity Investment Bank were the only investment schemes that recorded a decrease in assets under management in the third quarter of 2020, out of the 19 fund managers in Kenya.
Fund managers shied away from risky investments like equities and piled their funds in relatively safe assets such as government bonds and fixed deposits. The funds invested 44.03% of their funds in government securities, 39.78% in fixed deposits and only 5.44% in “NSE Listed Securities-Excluding those issued by the govt of Kenya”. 5.15% of the funds were held in cash and demand deposits while 0.52% and 0.44% of the funds were invested in offshore investments and immovable property respectively.