McTrust Fund gains in bumpy 2016

McTrust Fund gains in bumpy 2016

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By Ernest KISSIEDU & Ohemaa A. AMOAKO

Despite the difficult challenges the economy faced during the 2016 fiscal year, the McOttley Unit Trust (McTrust) Fund recorded significant growth in its investment market shares.

This was disclosed at McTrust’s second Annual General Meeting (AGM) in Accra last Friday.

The McTrust is an open-ended balanced fund that pools funds together for investment in a wide range of financial instruments such as equities and fixed income securities.

It is managed by McOttley Capital Limited.

Presenting the report, Manager of McTrust, Hilary Lomotey, indicated the Fund’s assets grew by 450.82% from GHC0.233m to GHC1.114m at the end of the 2016 financial year. The growth stemmed from continued patronage and good investment returns earned on the fund’s underlying assets.

In addition, the number of unit holders grew from 451 to 659 in 2016, representing a growth of 38.14% over that of 2015.

For him, this was in line with the fundamental investment policy of the Trust being equity bias when the stock market is performing well and a fixed income bias, when the stock market is on the downturn.

“The percentage of money market investments was 76.89%, equity 4.77% and cash 18.34%. The percentage of cash at the end of the year was due to a huge inflow of funds right at the end of the year, which was invested during the first week of January 2017,” the McTrust manager stressed.

Furthermore, Hilary Lomotey noted that the cedi was relatively stable in 2016 against all the major trading currencies depreciating by about 4.3 percent to the dollar even on the back of speculative activities.

“The Central bank increased its Gross Foreign Assets (GFA) from the US$750 million Eurobond, the $1.8 billion cocoa syndicated loan, US$116.2 million from IMF programme and the proceeds from the oversubscribed government of Ghana USD denominated bond among others,” he said.

Hilary Lomotey cited figures from the Ghana Statistical Service (GSS) indicates that consumer price inflation for January increased to 19%, from 17.7% recorded by the end of December 2015.

Inflation trended downwards to 18.9% in May, 2016 and further downwards to 16.7% in July and increased to 16.9% in August and further upwards to 17.2% by the end of September 2016.

It ended the year at 15.4 percent driven largely by the non-food inflation sector of 18.2% year-on-year.

Chairman of the Board of Directors of McTrust, Ambassador Kabral Blay-Amihere, added that the fund was among the top ten ranking of balance funds being managed in the industry.

“McTrust ended the year 2016 at a price of GHC0.1454.”

Ambassador Blay-Amihere opined that Ghana’s economic performance during 2016 was mixed, referencing World Bank reports.

“The target to narrow fiscal deficit further to 5.3% of GDP in 2016, from 10.2% of GDP in 2014 to 6.3% in 2015 was missed by a wide margin with the deficit widening to 9% of GDP.

“Nevertheless, GDP growth at 3.9% was slightly higher than the forecast of 3.3%, and inflation, after remaining stubbornly above 17.2%, fell a little to 15.4% in December,” Ambassador Blay-Amihere emphasized.

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