Stanbic IBTC Dollar Fund: A Hedge against Naira Depreciation

Stanbic IBTC Dollar Fund: A Hedge against Naira Depreciation

With Stanbic IBTC dollar fund, you can easily hedge against depreciating Naira asset, simple, convenient and it provides some flexibility. This is an open-ended unit trust scheme that invests in US dollar denominated securities.

The minimum investment amount is $1,000 while investors could make additional investment of $500 to increase initial investment outlay.

The benefit of this financial products is that you invest in dollar, and redeem in the same currency which is expected to come with principal plus return.

The opportunity available is available to individual, not corporate organisation, especially those that feel their exposures to Naira asset is impacting their net worth negatively.

By design, Stanbic IBTC dollar fund aims to provide currency diversification, income generation, and stable growth in United States dollar or the greenback.

Stanbic IBTC Managers invests a minimum of 70% of the portfolio in high-quality Eurobonds, a maximum of 25% in short term USD deposits, and a maximum of 10% in USD equities approved and registered by the Securities and Exchange Commission of Nigeria.

This professional service helps close the access gap as sometimes, even with your buckets of Naira deposits, you may not be able to investment in dollar instruments individually.

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Stanbic IBTC Asset Management explained that the financial product is quite convenient because investors can transact from anywhere with Stanbic online platforms (Mobile App and Web Portal).

It offers diversification advantage as mutual funds mitigate investment risks by investing across a diverse range of assets thus avoiding concentration risk.

This appears flexible for investors as the firm’s array of investment products are designed to suit investors various needs.

Stanbic IBTC Dollar Fund (SIDF) was launched in January 2017.

The Fund invests a minimum of 70% of its portfolio in high quality Eurobonds, maximum of 25% in short term USD deposits and a maximum of 10% in USD equities and for 180 days minimum holding period.

Meanwhile, the penalty for redeeming within the minimum holding period is 20% on the accrued income while the minimum investment amount is $1,000, and additional investment is $500.

The fund risk profile is “moderately conservative and the expense ratio is 1.5% – That is how much of the fund is used for administrative expenses. This fund can be used to secure a loan with Stanbic IBTC Bank.

How to Register

Require document include a duly executed subscription form, passport photograph for each applicant, government issued identity card and a proof of address showing your name/surname.

How to Redeem

To redeem a part or all your investments at any time, you will need to login to your mutual fund account via the web or mobile app and initiate a redemption.

The proceeds of your redemption will be transferred to your nominated bank account within three (3) working days, the daily limit for online redemption is $5,000.00.

Stanbic IBTC Dollar Fund: A Hedge against Naira Depreciation