Why You Should Let Your US Dollars Work For You Through The Jubilee Money Market Fund (USD)

If you have some US dollars with you, the first thought would be to check the exchange rate and then convert them into the local currency. The second thought would be to deposit them into a USD bank account so that they can earn you interest. What if that US dollar earned you money without you lifting a finger?

Jubilee Asset Management Limited recently launched a USD Money Market Fund that caters to risk-averse investors seeking stable and predictable US dollar-denominated returns. The Fund invests in secure USD-denominated short-term fixed and floating rate debt securities issued by sovereigns and corporates in Kenya or offshore. In the month of June 2024, the Jubilee Money Market Fund (USD) generated an average effective annual yield of 8.03% per annum.

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Your USD in the Jubilee Money Market Fund will bring the following benefits your way:

• Competitive Returns: The Fund delivers higher returns than USD bank deposits.
• Diversification: Investors can diversify their investments and reduce exposure to local currencies-denominated assets.
• Liquidity: The Fund is highly liquid and allows investors to retrieve funds with ease.
• Stability and Safety: The Fund is required by Capital Market Regulations to invest in short-maturity, low-risk investments making it less volatile.
• Tax-exempt Fund: The Fund is registered as a tax-exempt fund on income and capital gains. Distributions to investors are subject to a 15% withholding tax.

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Why invest in a Money Market Fund (USD) you ask? There is no doubt that Kenya, like many emerging economies, has had a fair share of economic ups and downs. Inflation rates have soared, the cost of living has escalated, and the Kenyan shilling has been experiencing fluctuations.

Among the myriad investment vehicles available, a Money Market Fund stands out as a stable and straightforward choice for investors looking to generate moderate income on their liquid portfolio. Money Market Funds, often referred to as “cash equivalents,” have long been a trusted staple in the world of asset management. These funds are a compelling choice due to their safety, liquidity, and simplicity.

Kenyans have traditionally relied on fixed deposits and savings accounts, SACCOs and Chamas as our go-to savings vehicles. While these options offer security and are relatively hassle-free, the returns are often affected by the rising cost of living and currency depreciation, effectively eroding the real value of savings. Alternatively, Money Market Funds present a compelling alternative for savvy Kenyan investors seeking to preserve and potentially grow their wealth despite economic headwinds.

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