There is a public service announcement that airs on American Televisions as a way to remind parents to check up on their children. That public service announcement, which comes on shortly before the commencement of the 10 PM news, goes thus: “It is 10 PM, do you know where your children are?”

In a similar fashion, people with mutual funds investments should have an alarm go off in their brains at the end of every month that chimes, “It is the end of the month, do you know how your mutual funds did?”

Mutual funds in Nigeria posted stellar performances in the month of October, with seven of the funds printing double-digit returns in the review month while the net asset value of the industry increased by N11.9 billion to N1.38 trillion. This is according to a recent analysis carried out by Nairalytics, on the data obtained from the Securities and Exchange Commission (SEC).

What does the data say?

According to the data, the net asset value of the entire mutual fund industry grew from N1.368 trillion recorded as of 30th September 2021 to N1.38 trillion as of the end of the month, representing a month-on-month increase of 0.9%.

Similarly, 56.5% of the registered funds on the website of SEC recorded positive returns on investment in the review month in contrast to 15.3%, which recorded negative returns while 28.2% of the listed funds remained flat.

Mutual fund investment is one of the popular forms of investments in Nigeria especially for passive investors; hence it is pertinent to constantly monitor and track the performances of these instruments, in order to inform the decisions of the investing community. To this end, Nairametrics ranks the best performing mutual funds for the month of October 2021.

The rank was computed by comparing the unit prices of each fund between September 30th and October 29th.

Further analysis into the growth of the net asset value shows that the money market funds pushed the industry in the period under review, recording an increase of N14.72 billion to close at N537.1 billion at the end of September 2021

Meanwhile, below were the top-performing mutual funds in October 2021. We also highlighted their performance in terms of changes in net asset value and included profiles of the funds as described on their websites.

VI ETF (Exchange Traded Fund) – Vetiva Fund Managers Limited

The Vetiva Industrial ETF “VETIND ETF” is an open-ended Exchange Traded Fund managed by Vetiva Fund Managers Limited. The VETIND ETF is designed to track the performance of the constituent companies of the NGX Industrial Index and to replicate the price and yield performance of the Index.

The NGX Industrial Index comprises the top 10 companies in the Industrial sector listed on the Nigerian Exchange Limited (“NGX”) in terms of market capitalization and liquidity and is a price index weighted by adjusted market capitalization.

The VI ETF is the third Exchange-traded fund on the elite list of best performing mutual funds in the month, which is attributed to the stellar performance of the industrial sector on the Nigerian Exchange. A cursory look at the NGX Industrial Goods Index shows that the index rose by 4.21% in the month of October.

September 30th, 2021
Fund Price – N19.59
October 29th, 2021
Fund Price – N21.77
Return – 11.13%
Ranking – 5th

In the same vein, the net asset value also increased by 11.13% in the review month to close at N229.16 million as of the end of October 2021.

Cordros Milestone Fund (Mixed Fund) – Cordros Asset Management Limited

The Cordros Milestone Fund is an actively managed unit trust scheme that seeks to strategically allocate investments in assets such as equities, bonds (including government, sovereign, and investment-grade corporate bonds), and high-quality money market securities.

According to information on the website of Cordros Asset Management, the Fund is designed for retail, high net worth individuals, and institutional investors (Firms, societies, religious bodies, employee schemes amongst several others) whose primary goal is to minimize the risk associated with saving via a diversified investment solution across different asset classes.

September 30th, 2021
Fund Price – N120.24
October 29th, 2021
Fund Price – N134.01
Return – 11.45%
Ranking – 4th

However, the net asset value increased marginally by 1.68% in October 2021 from N328.79 million recorded at the end of September 2021 to N334.32 million as of 29th October 2021.

Stanbic IBTC ETF 30 Fund (Exchange Traded Fund) – Stanbic IBTC Asset Mgt. Limited

Stanbic IBTC ETF 30 Fund is an exchange-traded fund, which seeks to replicate the performance of the NSE 30 Index of the Nigerian Exchange.

According to information on the company’s website, the fund aims to replicate as closely as possible, before fees and expenses, the total return of the Nigerian Stock Exchange 30 Index (“NSE 30 Index” or “Index”) in terms of price performance as well as income from the underlying securities of the index.

Similarly, the NSE 30 index recorded a growth of 4.34% in the month of October 2021.

September 30th, 2021
Fund Price – N40.00
October 29th, 2021
Fund Price – N45.81
Return – 14.53%
Ranking – 3rd

It is worth noting that the net asset value increased by 8.26% to close at N529.3 million at the end of the review month.

Meristem Value ETF (Exchange Traded Fund) – Meristem Wealth Management Limited

The Meristem Value ETF, which is an exchange-traded fund tracking value stocks on the NGX grew by 14.82% in the month of October 2021. Also, data from the Nigerian Exchange shows that the NGX Meri Value Index grew by 15.88% in the same period.

The net asset value in a similar fashion grew by 15.68% in the review period to close at N217.51 million.

September 30th, 2021
Fund Price – N18.22
October 29th, 2021
Fund Price – N20.92
Return – 14.82%
Ranking – 2nd

ValuAlliance Value Fund (Mixed Funds) – ValuAlliance Asset Management Limited

Formerly known as “SIM Capital Alliance Value Fund,” this is a balanced unlisted close-ended fund (also known as interval fund) registered and regulated by the Securities and Exchange Commission.

According to the firm, the fund operates with a total return objective and aims to provide investors with capital growth over the long term by investing in listed and unlisted Nigerian equities as well as other securities as approved by the SEC.

The ValueAlliance Value fund is the best performing mutual fund in the review period after surging by 59.3% in the final week of October. On the other hand, its net asset value only increased by 5.6$ to close at N5.29 billion as of the end of the month.

September 30th, 2021
Fund Price – N115.05
October 29th, 2021
Fund Price – N183.28
Return – 59.31%
Ranking – 1st

Bubbling Under

VETBANK ETF (Vetiva Fund Managers Limited):  Return – 10.57%

FBN Nigeria Smart Beta Equity Fund (FBNQuest Asset Management Limited):  Return – 10.18%

Emerging Africa Balanced-Diversity Fund (Emerging Africa Asset Management Limited):  Return – 9.25%

Meristem Equity Market Fund (Meristem Wealth Management Limited):  Return – 6.38%

Stanbic IBTC Nigerian Equity Fund (Stanbic IBTC Asset Mgt. Limited):  Return – 6.35%

What you should know

Mutual funds are entities that pool cash from various investors for the purpose of investing the cash in shares, bonds, treasury bills, etc.
The profit earned from the diversified pool of investments is shared to investors in the funds annually or semi-annually or as stipulated in the fund prospectus.
The Net Asset Value (NAV) represents the net value of an entity. This is the price at which investors buy funds from a fund company or sell it back to the fund house. It is calculated by dividing the total value of all the assets in a portfolio, minus all its liabilities.
The performance of a particular scheme of a mutual fund is denoted by Net Asset Value (NAV). In simple terms, NAV is the market value of the securities held by the scheme.