Why more Kenyans are choosing Unit Trusts over Stocks
While stocks have the potential to generate significantly higher returns compared to unit trusts, unit trusts are affordable, easily accessible, provide stability and diversification and have steady and predictable returns.
Unit trusts have become an increasingly popular investment option in Kenya.
While stocks have the potential to generate significantly higher returns compared to unit trusts, unit trusts are affordable and easily accessible, provide stability and diversification, and have steady and predictable returns.
A unit trust or fund allows investors to combine their money and invest it in various assets and financial markets.
The fund is run by investment managers who use their expertise to increase its value over time. They invest in equities, bonds, listed property, and cash. Institutions like banks, such as NCBA, participate in the money market, where their collective investment schemes are regulated by the Capital Markets Authority.
However, choosing unit trusts over stocks depends on investors’ financial knowledge, risk appetite and investment goals.