The number of Kenyans investing with Exchange Traded Funds (ETFs) and Money Market Funds (MMFs) has recorded a growth in interest due to improved financial literacy according to findings by Standard Chartered.
This trend is fueled by improved financial literacy and the desire to explore investment options beyond local markets.
Standard Chartered head of wealth and retail banking for Kenya and East Africa Edith Chumba, says this trend has prompted the industry to adopt wealth management solutions particularly for retail clients.
MMFs, which invest in short-term, low-risk financial instruments like treasury bills, have been especially attractive to conservative investors looking for stability.
These funds offer higher returns compared to standard savings accounts, while maintaining liquidity and accessibility.
“We believe that an informed investor is an empowered investor. Recent surveys indicate that 60 per cent of new investors feel inadequately prepared to make investment decisions on global platforms,” said Chumba.
“We are responding by enhancing our educational initiatives and digital offerings to build confidence and competence in the investment sector.”
At the same time, ETFs are gaining traction among investors seeking exposure to both local and global markets.
ETFs allow individuals to invest in a diversified portfolio of assets, such as stocks or bonds, with the flexibility to trade them like individual stocks.
This has made them an appealing option for Kenyans looking for affordable, low-risk exposure to international markets.
This has seen the lender introduce new products this year, including US Corporate Bonds, USD Government Bonds, and the bank's own curated Signature CIO Funds.
These additions complement an already diverse portfolio of investment products, such as Environmental, Social, and Governance (ESG) funds, USD-denominated MMFs, and mutual funds in multiple currencies.
With the growing demand for global investment opportunities, the bank has leveraged its comprehensive digital infrastructure to democratize access to these solutions.
The lender says through its platforms, investors can now buy, track, and sell US Treasuries, Foreign Currency Money Market Funds (FCY/MMFs), and the CIO Signature Funds.
Research shows that foreign currency assets, such as US Treasuries and FCY/MMFs, are becoming increasingly popular among Kenyan investors eager to diversify their portfolios.
“Our investment offerings are built on a structured advisory framework that provides comprehensive research, ensuring that our clients are well-equipped to make sound financial decisions," Chumba added.