THE Financial Securities Exchange (Finsec) is working on a plan to promote existing unit trusts to graduate into mutual funds as it eyes more listings on the bourse, NewsDay Business understands.
A unit trust is an unincorporated mutual fund structure that holds assets and provides profits to individual unit owners instead of reinvesting into the fund.
Finsec’s interest in growing these trusts comes as it recently listed another unit trust, Smartvest High Income Fund, which seeks to deliver a high level of income and moderate capital growth over time for investors.
Finsec chief executive officer Collen Tapfumaneyi said the bourse also had traditional assets like equities and medium- to long-term debt instruments planned for listing.
“The Smartvest High Income Fund is a fund we recently listed on Finsec, in collaboration with several partners, including those in the microfinance sector. This fund is designed with a clear focus: to provide funding to SMEs [small and medium enterprises], supporting their growth and helping build a stronger economy,” he said.
“In addition, we are working to promote existing unit trusts, helping them graduate into mutual funds, which will allow for secondary trading.”
He said Finsec also had several other funds in the pipeline.
Some of the funds, Tapfumaneyi added, are targeted at the mining and property sectors.
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He said Finsec was also developing a climate fund to support climate change-proof investments.
“Beyond that, we have funds aimed at supporting the agricultural sector, with a focus on financing the entire value chain,” Tapfumaneyi said.
“As we approach the end of the year, we expect to see more activity in the market.”
Finsec provides an electronic platform that formalises marginalised market segments and brings together all alternative trading activities in a central and organised marketplace.
The platform facilitates electronic trading of a wide variety of securities and enhances financial inclusion by enabling all investors access to alternative capital market investment options.
