Best Balanced Funds In Kenya

What is a Balanced Fund?

 A balanced fund is a type of mutual fund that owns both stocks and bonds. Balanced funds own stocks to benefit from appreciation, and generate income from bonds.

Typically, stocks comprise from half to 70% of a balanced mutual fund’s portfolio, with bonds accounting for the rest.

Best Balanced Funds In Kenya

  • Zimele Balanced Fund.
  • CIC Insurance Equity Fund.
  • CIC Fixed Income Fund.
  • CIC Balanced Fund.
  • GenCap Hela Fund (Money Market)
  • GenCap Iman Fund (Shariah Compliant)
  • GenCap Hisa Fund (Equity)
  • GenCap Eneza Fund (Diversified/ Balanced) Cytonn Investment unit trusts Kenya.

The Money Market Fund

If you are looking for a short-term venture with low risk, then the Money Market Fund is ideal. Here, fund managers may invest in bank deposits, treasury bills, commercial paper, debt securities, and government bonds maturing in less than a year (12 months).

Also, you accrue interest on a daily basis with the money market. However, the yield per day can change. Most importantly, you can easily access your money.

Bond Funds

Another low-risk investment is the bond funds which mostly invest in government and corporate bonds. The primary advantage of bond funds is that you get a stable revenue stream and you can preserve your capital.

Equity Funds

For the risk-takers attracted to high returns, Equity Funds are the best investment vehicle. Also, this is an opportunity for all who would love to invest in the stock market but do not know where to start.

However, to realize good yields, you will have to be ready to invest your money for a period of 3 to 5 years. As such, it is not advisable to commit money you want to use in a short while or your savings to this fund.

Balanced Funds

Balanced Funds provide a mix of high and low-risk investments. Fund managers will spread your investments to equities, offshore/local investments, and other interest-bearing ventures. For good returns, you will have to wait for about 3 to 5 years.

There are other investment options provided by the different asset management companies in Kenya. For example, Old Mutual Kenya offers the East African Fund which is a collection of interest-bearing investments in Kenya.

Are balanced funds good for long-term?

A balanced fund—sometimes also called a blended fund—provides investors with a balanced portfolio of stocks and bonds in a single mutual fund.

By balancing a large allocation to stocks with a lesser allocation to bonds, a balanced fund provides investors with long-term growth potential plus a source of income.

What is the risk of a balanced fund?

A balanced fund is attractive to investors with low-risk tolerance because the fund’s growth outpaces inflation and provides steady returns.

While balanced funds are a comparatively conservative investment strategy, they are still not 100% risk-free because bonds will fluctuate if interest rates change.