There has been a recorded increase in the number of Kenyans looking to explore Exchange Traded Funds (ETFs) and Money Market Funds (MMFs) as revenue streams.
This according to a report by Standard Chartered as seen in the Kenyan newspaper, the Star, is a result of a growing rate of financial literacy in the country.
The spike in financial literacy has inadvertently increased interest in this financial alternative as people begin exploring investment options outside of local markets.
Edith Chumba, Standard Chartered’s head of wealth and retail banking for Kenya and East Africa, argues that this development has led the sector to implement wealth management services, particularly for retail clients.
MMFs, which invest in short-term, low-risk financial instruments such as Treasury bills, have proven particularly appealing to investors who are conservative and seeking stability.
“We believe that an informed investor is an empowered investor. Recent surveys indicate that 60 percent of new investors feel inadequately prepared to make investment decisions on global platforms,” she stated
“We are responding by enhancing our educational initiatives and digital offerings to build confidence and competence in the investment sector,” she added.
Subsequently, ETFs are becoming popular among investors looking for exposure in both the domestic and international markets.
ETFs enable individuals to invest in a diverse portfolio of assets, such as stocks or bonds, with the ability to trade them as individual equities.
This renders these types of investment option a popular choice for Kenyans considering low-risk exposure to overseas markets.
