Top 5 Money Market Funds In Kenya By Yield

By Soko Directory Team / Published February 22, 2021 | 11:10 am

KEY POINTS

Money Market Funds are suitable for risk-averse investors as they provide stable fixed-income returns with minimal risk while providing easy access to cash.

The following Money Market Funds had the highest average effective annual yield declared, with the Cytonn Money Market Fund having the highest effective annual yield at 10.6 percent against the industrial average of 8.8 percent.

Cytonn Money Market Fund – 10.6%
GenCapHela Imara Money Market Fund – 10.2%
Zimele Money Market Fund – 9.9%
Alphafrica Kaisha Money Market Fund – 9.7%
Nabo Africa Money Market Fund – 9.5%

Money Market Funds (MMFs) in the recent past have gained popularity in Kenya, with one of the main reasons is the higher returns from money market funds compared to the returns on bank deposits.

According to the Central Bank of Kenya data, the average deposit rate during the quarter declined to 6.4 percent, post the removal of the deposit rate cap floor in August 2018, from an average of 7.8 percent when the legislation was in place.

As per regulations, funds in MMFs should be invested in liquid interest-bearing securities that have a weighted average maturity of fewer than 13 months.

These securities include bank deposits, securities listed on NSE, and securities issued by the Government of Kenya. The Fund is best suited for investors who require a low-risk investment that offers capital stability, liquidity and requires a high-income yield.

The Fund is also a good safe haven for investors who wish to switch from a higher-risk portfolio to a low-risk portfolio, especially during times of uncertainty.

Money Market Fund – This fund invests in short-term debt securities with high credit quality such as fixed deposits, treasury bills, and commercial papers.
Money Market Funds are suitable for risk-averse investors as they provide stable fixed-income returns with minimal risk while providing easy access to cash.

READ: Cytonn Money Market Fund Grew To Ksh 1.01 Billion In 2020

About Soko Directory Team

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