Kenyan investors are increasingly moving their money out of traditional money market funds and into special funds, driven by lower returns in the former. The average return on money market funds dropped to 9.3% by October 15, according to recent data. This decline has prompted investors to seek better performance elsewhere.
Special funds, which focus on specific sectors or strategies, have seen a rise in their share of collective investment scheme assets. In June, they held 26.6% of total assets, up from 23.9% in March. This growth reflects a growing preference among investors for diversified or targeted investment options.
The shift highlights a broader trend in Kenya’s financial market, where investors are becoming more selective about where to place their capital. With returns on conventional money market funds declining, many are turning to alternative investment vehicles that offer potentially higher returns. This change could signal a long-term transformation in how Kenyan investors approach their portfolios.
