Despite the coronavirus pandemic affecting the investment climate and shattering market confidence, InvestCorp Limited showed an impressive performance for 2020, as all four investment portfolios under management recorded impressive growth in Assets under Management (AUM).
Even though the economic climate was challenging, InvestCorp launched three additional mutual funds in 2020; bringing the number of mutual funds under the its management to four. InvestCorp’s mutual fund offerings enable investors to plan toward and finance their evolving life goals and priorities, especially during this period of economic uncertainty.
Managing Director of InvestCorp, Henry Sunkwa-Mills, attributed the performance to a strengthened investment committee, re-orientation of human capital, continued adherence to corporate governance practices, and application/implementation of innovative electronic channels – especially during the COVID-19 pandemic.
He further assured investors at this year’s AGM of InvestCorp’s commitment to work harder to sustain positive returns on their investments, emphasising the firm’s confidence in the economy’s progressive recovery.
InvestCorp Treasury Securities Fund (ITSF)
One of the investment portfolios, the InvestCorp Treasury Securities Fund (ITSF) – which was launched just in May 2020, with Assets under Management (AUM) of GH¢200,047 at an initial price of GH¢1 – grew in size to more than GH¢14.4million, representing a growth ratio of more than 72. The Fund achieved an annualised yield of 19.81 percent against its benchmark of 17 percent.
Commenting on the performance, Fund Manager Solomon Adatsi assured investors of a better performance at the end of 2021.
“This extraordinary feat achieved by the Fund in amid the COVID-19 pandemic came as a result of the opportunity the Fund presented to investors seeking safety in Treasury securities, as the outlook remained uncertain. Our active trading strategy and access to real-time pricing data via a Bloomberg terminal will enable us to make adjustments in our investment strategy when the need arises,” he said.
Board Chairman Anthony Ebow Spio said the ITSF, an open-ended risk-free (sovereign-only exposure) Fund, was designed for investors who seek exposure solely to Treasury bills, notes and bonds or Treasury-backed securities.
He added that the Fund provides a strategic way to get a well-diversified exposure to Government of Ghana securities or Treasury-backed securities to meet investors’ long-term life goals.
The InvestCorp Money Market Fund (IMMF)
Another portfolio, the InvestCorp Money Market Fund, also posted an annualised yield of 15.10 percent for the year ended 2020 against its benchmark of 16.09 percent, but outperformed the 91-day T-bill. The Fund further recorded growth of 18.4 percent in Assets under Management (AUM) to GH¢4.9million in 2020 from the GH¢4.2million of the previous year.
The Fund is modelled to balance the risk associated with earning competitive returns with capital protection, through a rigorous investment approach ensuring that investors benefit from the current growth and opportunities while keeping investment risk to the barest minimum. The Fund’s investment universe consists of short-term Treasury securities, certificates of deposit, cocoa bills, repurchase/reverse agreements and commercial papers.
Commenting on the economic outlook, Ms. Abena Sam-Asmah (Fund Manager) highlighted reinvestment risks to the portfolio considering the current low interest rate environment, although outlook for 2021 remains positive.
“We remain cautious and are closely monitoring new developments from the pandemic’s fallout, and its impact on the economy and capital markets, in order to build a resilient portfolio,” she said.
The InvestCorp Active Equity Fund (IAEF)
The Active Equity Fund portfolio also posted an increase in Assets under Management (AUM) from GH¢81,098 in 2019 to GH¢182,601 in 2020, representing a growth of 125.2 percent. The Fund posted a return of -5.67 percent in 2020, outperforming its benchmark (GSE Composite Index) which stood at -13.98 percent.
The performance, according to Fund Manager Ms. Leticia Opoku, was due to investment in stocks across the financial, petroleum and telecom sectors which posted stronger earnings and valuation multiples. To boost the performance for this year, she added that the fund will maintain its fixed-income holdings for liquidity management and as a hedge against shocks and volatility on the bourse.
The InvestCorp Mid-Tier Fund (IMTF)
This portfolio also ended the year with an annualised yield of 17.80 percent against its benchmark of 17.09 percent (91-day T-bill + 3 percent), indicating an excess return of 71 basis points. The Fund experienced its lowest net Assets under Management (AUM) growth of 5.3 percent, recording GH¢18.1million in 2020 from the GH¢17.2million in 2019.
Commenting on the performance, Fund Manager Solomon Adatsi said the Fund underwent a significant restructuring of its asset allocation mix, as the financial sector clean-up helped it to recover all of its receivables and largely diversified its allocations away from Non-Bank Financial Institutions (NBFIs).
Going forward, Mr. Adatsi said issuance of the Daakye Trust Plc corporate bond will provide another investment option, as the bond has enhanced credit features and is fully backed by the Treasury, which lessens its credit risk.
Management of the company assured investors and clients at this year’s annual general meeting of its commitment to work hard to continue improving on the performance of their investments, hinging its confidence in the economy’s progressive recovery.
Newly launched InvestCorp e-Hub
Management of InvestCorp also used the meeting as an opportunity to notify all shareholders of its recently launched e-Hub.
Key features of the InvestCorp e-Hub include an upgraded website to keep stakeholders abreast with relevant investment and firm information; a new online self-service portal that allows clients to gain remote access to their accounts 24/7; a mobile application to enable smartphone users (android and iOS) gain real-time access to their accounts; mobile money USSD short codes (in partnership with Emergent & Zeepay) that allow clients without Internet service to access their accounts; and Controller and Accountant General’s Department (CAGD) source debits to enable public sector workers invest directly through their payroll accounts with the CAGD.
Through the InvestCorp e-Hub, clients will be able to top-up their investment accounts, set up recurring investment debits, open accounts, access and amend key account information, request redemptions, make requests for official statements, monitor all their investments, and access relevant research material.