Britam Special Wealth Management Fund

Britam Asset Managers is the market leader in the provision of low risk, fixed income investment solutions.
We invest client funds in the below fixed income assets;

•  Listed Treasury Bills
• Listed Treasury Bonds
• Bank Deposits
  

FIXED INCOME SPECIAL WEALTH MANAGEMENT FUND

The fund provides an alternative to the fixed deposit accounts offered by commercial banks and treasury bills with better improved returns.

 Suitable for investors whose liquidity needs are predictable
 Offers competitive and higher rates compared to bank deposits and treasury bills
 Investment periods: 3, 6,12 months
 Current average daily rate is 9% p.a. The rate fluctuates daily depending on market performance.
 The daily published rates are net of management fees and gross of withholding tax.
 Early withdrawals allowed subject to a penalty of 25% of the interest earned
 Monthly interest payment option available on request at no charges.
 Withdrawals are paid within 48 hours of request
 Available in KES and USD
 Minimum initial investment of Kes. 1,000,000 and top ups of Kes. 500,000

Our effective daily yields as at 31st October 2022 are as below; Currency Effective Daily Yield (p.a) Kenya Shillings
3 months 9.18%
6 months 9.38%
12 months 9.55%

Features of the Britam Special Wealth Management Fund

 

Feature	Description
Product Name	Britam Special Wealth Management Fund
Underlying Legal Vehicle	A limited liability partnership (LLP). Britam Asset Managers (Kenya) shall be the Principal Partner.
Investment Objective	Investment objective & policy of the Fund is to provide investors with a high income yield.
Fund Manager	Britam Asset Managers (Kenya) Ltd
Regulator	The Capital Markets Authority (CMA)
Custodian	Standard Chartered Bank
Trustees	A Corporate Trustee shall be appointed to perform oversight over the fund assets
Currency	KES
Investment Tenors	3, 6 or 12 months
Minimum Initial Investment	KES 1,000,000
Minimum Top Up Amount	KES 500,000

Initial Fee	0%
Annual Fund Management Fees	Management fees differ for each investment tenor as below:   3 Months Tenor: 2.0%   6 Months Tenor: 1.5%   12 Months Tenor: 1.0%
Tax on Interest	Maximum 15% WHT   The fund being a CIS should fall under the tax exempt status. Application to KRA for tax exemption is under way once the fund has been approved by CMA.   In the mean time, the existing tax treatment to continue i.e.   For individual accounts, the income shall be distributed net of withholding tax. Refunds shall be done for clients who are tax exempt.   For corporate accounts, the income shall be distributed gross of withholding tax. The corporate clients shall proceed to remit the withholding tax from the received income.
Early Redemption Charge	25% of interest earned

Switch Charge	A switch charge shall not be applicable. However, switch of units before maturity of the relevant investment tenor will be subjected to the early redemption charge of 25% of income earned.
Underlying Investments	Treasury Bonds and Bills, Bank fixed and call deposits, Corporate Bonds
Publication of Yields	Yields to be published daily in newspapers with a national circulation and shared via email just like MMF – Net of fees but Gross of WHT
Interest Compounding	Upon roll over of the funds as has been the case
Treatment of funds at maturity	At maturity, clients shall have access to the following options:   Roll over for the same original or different investment tenor   Withdraw fully   Withdraw part of their matured funds and roll over the balance to the same original or a different investment tenor.

Automatic Maturity Rollover/Payment Rules

Applies in cases where we do not get further information/instructions from clients as to how to treat their maturity  Clients shall specify in the application form the treatment of their funds at maturity. The following options are available: 1  Roll over the funds into the original investment tenor 2  Roll over the funds into a different investment tenor 3  Payment of the matured funds into their bank account   In the event that at maturity the client has not provided further instructions, the maturity proceeds shall automatically roll over to the current/different investment tenor as indicated on the application form or the full maturity value shall be deposited to the client’s bank account if this was specified in the application form.   In the event the rolled over amount is withdrawn before maturity, an early redemption charge of 25% of interest earned shall be applicable. The interest being penalized shall be the current AUM as at the date of withdrawal less the AUM as at the point of auto-roll over.   There shall be a 14 days’ grace period after maturity within which clients can withdraw their auto-rolled over funds without suffering the early withdrawal charge.

ABOUT US

• Incorporated in 2004 to offer quality Fund Management and Investment Advisory Services .
• Licensed by Capital Market Authority (CMA) and Retirement Benefits Authority (RBA)
• Kes 235 Billion Investors Assets Under Management

For More information on how to sign up, Contact

Gallin Wekesa-Financial Advisor @Britam

0712-870-447

gwwekesa@britam.com/ gallywexa@gmail.com

Asset Management FAQs

What is a unit trust?

A unit trust is a collective investment scheme in which investors’ contributions are pooled together to purchase a portfolio of financial securities, such as equities (shares), bonds, cash, bank deposits etc. The portfolio is managed by professional fund managers. Each unit trust fund or portfolio has a specific investment objective – income, growth or a combination of the two. The investment objective of a particular unit trust will determine the proportion of the fund invested in a particular security such as company shares. As the name suggests, a unit trust has a trust framework, with the investments held by an independent trustee. Unit trusts are regulated by the Capital Markets Authority to ensure that they are safe and that only registered professionals are involved with the affairs of the unit trusts. Unit trusts and other collective investment schemes such as mutual funds have been around the world since the 1930s and have become very popular as the ideal alternative in providing cost effective access to stock markets and fixed income investments, and diversifying one’s portfolio of investments.

What is a unit?

Your contributions to a unit trust are used to purchase units. Each unit represents an equal fraction of the total value of the pool of invested money. Units in the British-American Unit Trusts are brought from the fund manager, British-American Asset Managers Limited, and sold back to them in the event unit holders need to redeem their units. When you invest in a British-American Unit Trusts, the number of units you are allocated is calculated by dividing the amount you invest by the offer price at the time. As an example, if the offer price for each unit is Kshs 100, an investment of Kshs 250,000 will buy 2,500 units. The value of units moves in accordance with the performance of the unit trust’s assets.

What should I consider before I invest in a unit trust?

Before considering investing into a unit trust, the following should be ascertained:

1. Your risk profile
2. Your time horizon for the investment

3. Whether you require regular income from the investment or purely looking for capital growth.

Unit trusts are considered appropriate investment vehicles for individual investors wanting to gain long-term exposure to financial markets. However, the value of a unit trust depends on the value of the underlying assets within the portfolio. Therefore, the value of the unit trust will fluctuate as the values of the underlying assets fluctuate.

When is the best time to invest in unit trusts?

You can invest at any time. However, it is very difficult for an investor to predict market conditions i.e. to buy units at the lowest price and sell them at the highest price. Our knowledge and insight into the workings of the financial markets enables us to provide the investor with expertise which takes into account market fluctuations and applies an effective investment strategy. One of the most common mistakes made by investors is to switch in and out of unit trusts based on short-term performance figures. Periodic switching between funds can lead to increase in the cost of transactions, which can reduce the return on your investment. It is important to note that portfolio managers do not manage funds on a short- term basis. Most portfolios, particularly equity funds, are managed to generate consistently good returns over a period of five years and above. A good strategy is to buy unit trusts on a regular basis – termed shilling cost averaging. This method allows you to avoid the risk of poor timing, which may result in buying when the market is high and selling when the market is low.

What are the benefits of investing in a unit trust?

You gain several benefits from pooling your money in a trust with other investors.

Potentially superior returns: Unit trusts provide potentially superior returns to fixed deposits over the longer term, providing investors with the opportunity to build real wealth.
Easy and affordable investment: Unit trusts are a convenient and low-cost way of investing in financial markets. They enable investors to invest in a wide variety of diversified portfolios of shares, bonds and other financial instruments they would not necessarily be able to afford as individuals. Investor can share in the rewards of the stock exchange without the risks of direct investment. Unit trusts offer investors the choice of switching their portfolios when their needs and risk profile changes and the choice of increasing, stopping or decreasing stop orders without penalties.

Diversification of risks: With a relatively small investment, a collective investment provides access to a broad spread of different shares and investments. This diversification helps to reduce your risks because it makes you less dependent on the performance of one company.

Expertise in Professional Management: British-American Unit Trusts are managed by highly qualified investment managers and investment specialists whose full-time job is to make investment decisions. Few people have the time, skills or experience to actively manage their investments and research the best way of making money. By investing in the British-American unit trusts, experts experienced in investments are managing your money on a daily basis and ensuring your peace of mind.

Value for money: British-American nit trusts are designed to give investors good value for money. The pooling of money increases the buying power by enabling the payment of lower dealing and administration costs than if the investor had invested directly in a selection of investments. The pooling of investments also enables the fund manager to buy shares, money market instruments such as treasury bills, bonds and other investments which would be beyond the reach of the average investors.

Flexible investment options: British-American unit trusts provide investors with the following investment options:

Lump sum investments: A lump sum investment can be made at any time during the life of the investment,
resulting in the entire investment benefiting from the growth and income potential of the chosen unit trust. Following the opening of your account, you are able to invest any additional amounts to top up your account.

Monthly Investment Plan: A regular monthly investment can be made into your account resulting in an easier way of building capital. A monthly investment has the benefit of shilling cost averaging, where additional investments can be made during times of market weakness. A Monthly Investment Plan would also allow you to invest in a long term savings plan to meet your desired financial goals.

Switching: Investors are able to switch their investments between different portfolios.

Cash Withdrawal Facility: The Cash Withdrawal Facility allows you to take regular withdrawals from your British-American unit trusts. The facility is useful if you are investing for a specific event in the near future where you will require a regular flow of cash to pay for school fees, fund your children’s further education or to supplement a regular income. The Cash Withdrawal Facility is flexible, simple and tax-efficient way of taking withdrawals from your investments.

Liquidity: British-American unit trusts are flexible and easily accessible. You can sell all or part of your investment at any time. However, we recommend that investments in the Balanced Fund and the Equity Fund should be viewed as medium to longer term of 3 to 5 years or more in order to benefit from market cycles.

Tax efficient: Unit trusts are highly tax efficient investment. A unit trust fund does not pay tax on its income, either from dividends or interest. In addition, unit trusts do not pay tax on capital gains.

Safe and Transparent: Unit trusts are strictly controlled the Capital Markets Authority under the Capital Markets (Collective Investment Schemes) Regulations, 2001. The regulations impose duties and responsibilities on the key functionaries of the fund including fund manager, custodian and trustee. The fees and charges are transparent and are published in the Information Memorandum. Information on the investment performance is provided in a report audited by external auditors. Each unit trust has a Trust Deed, the legal document
establishing the trust, and an Information Memorandum, of which a copy are available by email. What returns can I expect from my investment?

Investment returns on a unit trust fund depend on the following:

1. Returns from the financial markets

2. The type of assets within the unit trust portfolio

3. The management skills of the portfolio managers.

The value of shares, bonds and other asset classes are determined by financial markets and can rise or fall over time. In general, equity-based unit trusts provide the highest potential return, followed by bond or income funds and finally money market funds. In addition, the level of investment return is generally related to the level of risk incurred i.e. the higher the potential risk, the greater the potential return.

What are the tips to successful investing? Before investing, it is useful to follow the following steps to ensure success
1. Identify your goal for investing This could be meeting future education expenses, retirement, payment of a deposit for a house or a savings plans

2. Establish a time-frame for your investment Be realistic about the time commitment for your investment. It is recommended that investments in unit trusts be medium to long-term investments.

3. Identify the level of risk It is important to understand the level of risk associated with different types of investments

4. Select a unit trust fund which best meets your requirements above.

Gallin Wekesa-Financial Advisor @Britam

0712-870-447

gwwekesa@britam.com/ gallywexa@gmail.com