Lagos — As the performances of the Nigerian Stocked Exchange continues to dip, experts are advising investors to also look at mutual funds as viable investment options.
The Fund Manager, UBA Asset Management Limited, Mr. Bayo Oritsejafor, said this during the UBA Asset Management Limited annual general meeting in Lagos.
He said: "Mutual funds are preferable to the ordinary share holders because mutual funds are managed by professionals. The professionals have the skills and techniques to make the right choices on behalf of their unit holders. The fund managers are also in position to give better advice to the unit holders."
He noted that since the beginning of the year, the rate for fixed income instruments - treasury bills, bonds and other instruments - have been going up.
"So, it is advisable at this point in time for investors to concentrate their investment option in the fixed income instruments like the money market fund, bond fund, because they will get better returns," he said.
Oritsejafor said: "At the beginning of the year, we predicted that the all share index will appreciate by 13 per cent this year. As I speak to you, all share index is 11.51 per cent. But we are optimistic that this development will be sustained till the end of the year."
Speaking on the performance of UBA Mutual funds - UBA equity Funds; UBA Money Market Funds; UBA Bond Funds anD UBA Balance Funds - performance well in the last year except for the UBA Equity funds which suffered loses to due to impact of the losses in the capital market.
"Our strategy paid off in the sense that three of our four funds were able to pay dividends to our fund holders. The only fund that was not able to pay dividend was our equity fund. Equity fund is mainly exposed to equity instruments in the stock exchange and the result was commendable because many fund managers were not able to pay dividend in this year. The balanced fund paid N5kobo and the bond fund paid 10 kobo, while the money market fund paid 8kobo," he said.
"The performance of the UBA equity fund mirrors the performance of the Nigerian stock exchange. We all know that the bearish fund in the exchange has affected the underlined instrument of the UBA equity fund is in equities. We all know that in the year 2011, the NSE all share index depreciated by 16.51 per cent and that also impacted on the equity fund," he said.