Business Daily (Nairobi)
Wanjiru Waithaka
11 November 2007
Nairobi — A women's only investment group has embarked on mentoring sessions with financial experts as it moves towards formalising its operations.
The 26-member Kenya Women's Investment Company (Kwic) will hold a one day investment workshop on Friday under the theme: Investment strategies for future growth.
The session will also be attended by other investment groups, which will share their experiences with Kwic members and financial advisors.
"We know that women put a lot of money into groups but management of these groups can be a challenge," says Margaret Waithaka, the secretary of Kwic's investment committee.
The group attributes it success to a careful enlisting of members with trust and commitment to long term investment .
"We are not into paying dividends or taking money out," says Dr Katherine Getao, a founder member and chair of the investment arm.
The topics set for discussion are the usual menu of international investment summits including the operations of the stock market, the role of brokers and venturing into the real estate sector; a hot pursuit for individual and institutional investors.
"We've seen a tremendous boom in the last three years. In the absence of a real estate index, we want to get an expert to analyse trends for us, " Ms Waithaka added.
The group traces its origins to November 2004 when 14 women turned up to a meeting arranged by Ms Getao and Rose Maina.
The group was officially started in January, 2005 with an aim to learn, socialise and build long term wealth for members who are now aged between 30 and 55 . A cap put at 20 members was extended to 26 to accommodate interest.
"People still ask to join," says Dr Getao, whose group includes people in various professions, for example business, information technology, academia, law and finance.
On the factors to success, Dr Getao says setting a realistic monthly contribution is critical. "If monthly contribution is too high members will strain and eventually drop out. If it's too low the wealth may not grow as fast making people impatient," she says. Kwic's contribution is set at Sh5,000.
KWIC, a limited liability company now boasts an investment portfolio valued at Sh5 million spread across money market funds (40 per cent), listed shares (20 per cent), unit trusts (20 per cent) and pooled funds (20 per cent).
"Our investment strategy was to put 30 per cent of our money in high risk stocks in the first two years as we finalised the administrative structures and bonded as a group," Ms Waithaka says.
This in financial terms, is a low risk (conservative) approach to investment which is set to be maintained as the group is now keen on investing in land. "The plan was to get into real estate after three years and purchase land for capital appreciation," she says.
The group's strategy is to invest in some IPOs for capital appreciation and a quick exit while holding blue chip stocks for dividend income.
"This way we are not at the mercy of the rapid movements in the stock market because we don't panic when a share loses value," says Ms Waithaka.
The group counts decision making and prompt implementation of agreed actions and members juggle between work and Kwic errands. Involving members in decision making, helps overcome this limitation to some extent.
Another challenge is different understanding of investments by members which they hope to address through drawing of a strategic plan acceptable to all members.
But members say that the benefits of pooled funds are worthwhile. "When investing as an individual chances of running out of cash are high," says Sharlynne Mbai, the chairperson of Kwic.
On the other hand monthly contributions and attendant fines mean a group is always liquid to take advantage of investment opportunities as they arise.
"Critical mass is important. Look at the Nyakinyua women who collectively bought large tracts of land in what is now Githurai and Kasarani. Now they are millionaires," says Ms Waithaka.
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