Investment funds are potentially a great way to get more from your money, but the fees associated with investment funding can often leave you unsure about whether they’re right for you. Ideally, you want to find a way to make your money grow and be able to withdraw it when you like, without any fees.
Here’s all you need to know about no fee investment funds in Kenya, including what they are and where to find them.
What Are No Fee Investment Funds?
Investment funds are made up of groups of people. Those people are investors who have put their money together to invest in corporations, stocks and businesses. You band together to invest funds, rather than buying stocks in the stock market as individuals.
All the risks are shared (therefore minimised) between shareholders and you all receive the benefits of the investment too.
Usually there’s a third party involved. They organise everything, bringing you and other investors together to invest your money. This makes finding an investment fund and managing your money much easier, as you’re not dealing with the other investors yourself.
However, many of those third parties don’t offer no fee investment funds in Kenya, or work for free. Often you’ll find that there are multiple fees attached. Some will charge more than others, but that’s not always a guarantee that your investment will be more successful.
No fee investment funds in Kenya are pretty self-explanatory. They are investment funds that have no fees attached, meaning no fees to start investing or withdraw them. Simple enough to understand, but tricky to find.
The Traditional Methods of Investing Funds in Kenya
When it comes to investing money in Kenya, there are 2 other options besides no fee investment funds. Kenya investments can also be bonds and stocks:
A large company, or the government, offers you bonds for your money. Those bonds have a time limit, so the money you give to the government (your investment) will come back to you at the end of that term. In the meantime, you receive regular payments for your investment from the interest agreed on.
These are usually issued for businesses and projects that need funding, rather than individuals.
You can invest in stocks at the stock market. You can choose to invest in one company (direct) or multiple (indirect) to spread the risk. The main stock market in Kenya is the Nairobi Stocks Exchange. Like investment funds, you’ll most likely use a third party to navigate the share dealing platforms and handle the actual investing.
Both bonds and stocks will have risks and benefits, just like costly and no fee investment funds in Kenya. Unlike investment funds however, you’ll be investing on your own rather than in a group of investors.
Can I Invest Funds for Free?
If a broker or third party company is offering an investment fund for free, be wary. There are often fees that the third party has to pay to invest your funds, plus there are usually administration and management fees that cover the costs of the third party handling your money.
If you aren’t paying for those services, ask who is paying for them. If a broker offers no fee services in Kenya and doesn’t sound legitimate, or if you have any concerns at all, it’s best not to invest. It’s not worth losing your money.
The Best Places to Buy Investment Funds in Kenya
The best places are those that are transparent with all their fees upfront.
Usually management fees are around 1% or 2%. You should also ask about administration fees, early withdrawal fees and other fees you may need to pay when the investment fund matures.
Some of the biggest investment brokers in Kenya include: Genghis Capital, Dyer and Blair and CFC Stanbic. Their fees will vary; make sure to do your research before trusting your money with any broker, no matter how big they are.
Mombo App is still gearing up to the launch of our investment services, including investment funds. We strive to be transparent with our fees, making it very clear what you will be charged and when.
Our only fee is a 1% withdrawal fee for those shareholders that decide to withdraw their money before the term is up. You can find out more about the launch of Mombo investments here.