Ghana's premier investment bank, Databank, which is well recognized for achieving so many firsts in the development of Ghana's financial market on Thursday launched the country's first money market mutual fund. The fund christened the Mfund comes several years after Databank started managing its flagship equity mutual fund known as Epack which has yielded an average return of 67% a year since 1996. The Mfund was licensed on January 6th, 2004, by the Securities and Exchange Commission (SEC) to operate as the first money market mutual fund in the history of Ghana. A money market fund is a specialized company that pools money from several investors, to invest in short term high yielding debt instruments thus enabling investors to enhance the interest on their savings. Money market funds tend to yield returns close to those on treasury bills but with an added advantage of being very liquid while at the same time preserves the investor's capital. Because money market funds tend to invest largely in high quality debt instruments, the default risk attached to the portfolio of securities it holds tends to be extremely low.
The manager of the MFUND said at the launch that the objective of the fund is to provide high current income consistent with the maintenance and preservation of capital. MFUND will offer superior returns on savings to Ghanaians and also enable industry to access cheaper sources of credit to meet their short to medium term financial needs.
Other benefits of the fund are; investors can expect a steady and regular flow of income to meet their monthly and quarterly expenditures while enjoying easy access to the expertise of a professional fund manager.
MFUND is also targeted at Ghanaians who traditionally do not save with the banks. The fund is managed professionally by Databank Asset Management Services Limited, Ghana's leading Investment Managers with over ¢300 billion under management.
The price per share of MFUND will be maintained at ¢1000. Investments in MFUND can be done with a minimum monthly contribution of ¢50,000 or a lump sum of a minimum of ¢500,000. Subscription to the MFUND can be made at any of Databank's offices in Accra, Tema and Kumasi.