First Fund, a short term investment scheme, closed the 2011 financial year with an annualised yield of 20.26 per cent despite general decline in yields of Government’s treasury bills and other money market securities.
The Fund, which is run by First Fund Limited (FFL) of the FirstBanc Financial Services (FFS), an investment banking firm, closed the year with its Asset Under Management (AUM) surging from GH¢778,628.67 to GH¢3,728,136.48, a performance which represents an increase of 379 per cent over the 2010 period.
Professor Cletus Dordunoo, Board Chairman of the FFL who announced this at the company’s Second Annual General Meeting (AGM) held in Accra on Wednesday, attributed the surge in AUM to “impressive return and increased investment on the fund.”
“I am once again happy to announce that we have made more progress in increasing our AUM to more than GH¢4.5 million as at the close of the first quarter of this year,” he added.
Mr Samuel Annie Asiedu, Chief Investment Officer of FFL said the company’s investment strategy in 2012 would be to lock up funds in mid-term securities such as the 182 day certificates of deposits within the first half of the year.
“We believe that the Government will be demanding funds from treasury market to fund projects ahead of elections hence our strategy to lock up funds in short to mid-term securities to enable us take advantage of increasing rates,” he said.
Mr Asiedu added “this strategy may continue into the third quarter, in the event that current economic conditions remain unchanged.”
The day’s event witnessed the maiden AGM being organized by Heritage Fund Limited (HFL), an investment banking firm of the FFS to declare the company’s performance to its shareholders.
Professor John Bright Aheto, Board Chairman of HFL, said the company’s equity mutual fund dubbed “FirstBanc Heritage Fund,” posted a year to date return of negative 10.02 per cent for full year 2011 after recording a four-month return of 3.29 per cent.
He said the Fund’s poor performance was caused by declines, particularly, in stocks on the Ghana Stock Exchange (GSE) that it was exposed to, stressing that “the Ghana stock market had a rough ride in 2011, reaching its lowest point in two years by December 30.”
“The GSE-(Composite Index) CI fell to 969.03 points from 10001 at the beginning of the year. Despite the doubling in market capitalization following the listing of Tullow Oil Plc, volume of equity traded decreased to 288,708.855 shares, a drop of 13 per cent over prior year,” he said.
Prof Aheto said the company’s strategy for 2012 would be to consolidate the HFL’s holdings in stocks with good fundamentals and review its positions in those stocks that had significant negative impact on the overall performance.
He said plans were far advanced to increase HFL’s fund size to enable the company enroll in global stock markets.
Prof Aheto added that plans were in place to beef up the marketing team of HFL to enable the company increase the size of her funds.