Description

WRITE UP	Investment in Fixed Income Fund
INTERMEDIARY	Attique Africa
PROVIDER	ICEA Lion Assets Management Company
TYPE	A Mid-Term Investment Option
PURPOSE	An investment option that generates a steady income with lower risk compared to equity.

Fixed Income Fund is a Collective Investment Scheme (CIS) that pools money from investors to invest in debt securities like treasury bills, treasury bonds, commercial paper, and corporate bonds, offering stable and predictable returns. It is structured as a unit trust and is regulated by the Capital Markets Authority (CMA) ensuring transparency, investor protection, and adherence to prescribed guidelines.

The primary investment objective is to seek long term capital growth and income generation consistent with moderate investment risk from a wide range of interest-bearing securities.

Key Features of the Fixed Income Fund Investment:

• Investment Objective: FID generates steady income with lower risk compared to equity investments.

• Asset Allocation: FID must invest a minimum of 80% of their assets in fixed income securities at all times.

• Liquidity: FID Typically offer higher liquidity than individual bond investments, allowing investors to redeem units as needed.

• Regulatory Oversight:  FID is regulated by the Capital Markets Authority (CMA) under the Collective Investment Schemes Regulations, 2023. Funds must adhere to strict guidelines on asset allocation, valuation, and reporting.
• Currencies: KSHS. & USD

Fixed Income Funds Q & A

Is Capital guaranteed in the Fixed Income Fund?

No, capital is not guaranteed but is preserved through low-risk investments. The investments done by the fund are in government or hi

ghly rated instruments which are generally considered to be low risk investments.

What fees are involved?

• Management Fee (Maximum of 2.0%)
• No entry or exit fees
• The Unit Price reported is Net of all Expenses

How do I track my investment?

The fund issues monthly statements that indicate the number of units held in the fund and the market value of each unit. In addition, there is a monthly fact sheet that details the performance of the fund

How do I withdraw from the Fixed Income Fund?

Investors can redeem their units / withdraw from the fund at any time. Withdrawals are typically paid within 1–3 working days. Investors (also called Unit holders) can withdrawal partially or fully and you will be paid the return earned over the period you have been invested in the fund.

What risks should I be aware of when investing in the Fixed Income Fund?

For unit holders (investors) in the Fixed income fund the following are the key risks faced by the investments

• Interest Rate Risk: Risk that Bond values will decline when interest rates rise resulting in a lower unit value. Mitigation: Duration management (e.g., investing in shorter-duration securities), Active portfolio rebalancing by the fund manager.
• Credit Risk / Default Risk: Risk that an issuer may fail to repay interest or principal.  Mitigation: The fund has strict credit assessment and investment-grade filters.

• Liquidity Risk: The risk that unit holders may be unable to liquidate their investments in the fund in a timely manner without loss of value.

Provider: ICEA Lion ASSETS Management Co. Ltd