Botswana Insurance Fund Management (BIFM) Unit Trusts has urged Batswana to diversify their egg nests by investing in Unit Trusts.
BIFM Unit Trusts Head of Retail, Setshwano Ngope told Voice Money that Unit Trusts are investment vehicles designed to give clients access to the bond and stock markets in a transparent and less risky manner.
She said, “Through unit trusts, individuals are able to invest in different asset classes such as shares, bonds, property and cash. There are different types of funds available, with each fund investing according to its risk profile.”
Unit Trusts have been in the Botswana market since 2002, but BIFM launched four funds on the 30th of April 2013.
According to Ngope, the funds launched are; Money Market Fund, Balanced Prudential Fund, Global Balanced Fund and Global Equity Fund.
“Each fund has its own mandate, which stipulates the kind of investment vehicles that it can invest in,” said the Head of Retail.
Asked how different these Unit Trusts are from other investments vehicles in the market, Ngope said they differ in that clients’ funds are pooled with other clients’ monies and invested in different vehicles.
Ngope revealed, “Because a client’s funds are invested in a range of assets at the same time, the client’s portfolio is well diversified.
With Unit Trusts, the client always knows exactly what their funds are invested in.
They also have a choice in that they can select a fund that suits their personal risk profile and investment horizon.”
Unlike shares where individuals go directly to the stock markets to invest, Ngope said Unit Trusts are safer because clients will invest in a wide variety of shares and other assets all at the same time.
“The assets BIFM invests in, such as Government Bonds and Treasury Bills are secure and will always be safer,” she said
The product pays interest either monthly or semi-annually depending on the fund chosen.
According to BIFM Unit Trusts, clients can invest for as little as P200 per month or a P1000 once off lump sum. The fund managers assured that Unit Trusts regularly outperform inflation, and are a great way to grow capital and earn interest.
BIFM Unit Trusts has urged those who want to save for a house, education or any short, medium or long term goal, to waste no time and invest immediately.
Meanwhile, Unit Trusts are found in Australia, Ireland, the Isle of Man, Jersey, New Zealand, Namibia, South Africa, Singapore, Malaysia and the United Kingdom.
They are open-ended investments; therefore the underlying value of the assets is always directly represented by the total number of units issued multiplied by the unit price less the transaction or management fee charged, and any other associated costs.