In the world of investments, balancing risk and return is essential. One fund that has gained significant traction in Kenya is Mansa-X, a Multi-Asset Strategy Fund by Standard Investment Bank (SIB). Investors are drawn to its promise of high returns through portfolio diversification, a sophisticated long/short trading model, and a focus on managing financial market volatility.
But is Mansa-X as lucrative and safe as it appears? .
What Is Mansa-X?
Mansa-X is a regulated investment product under Kenya’s Capital Markets Authority (CMA). Managed by Standard Investment Bank, it is an open-ended fund that uses a diversified portfolio strategy to trade multiple assets globally.
Its name is inspired by Mansa Musa, the 9th Emperor of Mali, renowned for his wealth and financial ingenuity. The fund aspires to embody this legacy by offering modern investors resilience and prosperity through diversified investments in global financial markets.
Mansa-X leverages cutting-edge technology and risk management strategies to execute trades across currencies, commodities, derivatives, fixed income, and equities. It aims to provide competitive returns without compromising liquidity or exposing investors to undue risks.
How Does Mansa-X Work?
Multi-Asset Portfolio Diversification
Mansa-X thrives on portfolio diversification, spreading investments across:
- Global Markets: Includes assets like single stocks, stock indices, commodities (e.g., gold, oil, and wheat), and currencies (e.g., USD).
- Local Markets: Includes Nairobi Securities Exchange (NSE) stocks, fixed income instruments, and derivatives.
This blend of local and international exposure reduces the risk of over-reliance on a single asset class, protecting investors from financial market volatility.
Long/Short Trading Strategy
The fund uses a long/short trading model, allowing it to profit in both rising and falling markets. This approach is particularly beneficial during economic downturns, as the fund can hedge against risks while capitalizing on market opportunities.
Active Risk Management
One of Mansa-X’s standout features is its proactive approach to risk management. By analyzing global economic trends, geopolitical events, and market sentiment, the fund adjusts its holdings to align with prevailing conditions.
For instance, during the 2022 Russia-Ukraine conflict, the fund prioritized commodities such as crude oil and wheat, which were resilient amid global economic turmoil.
Historical Performance of Mansa-X
Mansa-X has consistently delivered impressive returns.
- Growth in Assets Under Management (AUM):
In 2022, Mansa-X’s AUM surged by 87%, reaching KES 12.4 billion, up from KES 6.6 billion in 2021. This growth reflects increased investor confidence and the fund’s ability to navigate challenging markets. - Annual Returns:
- 2022: Net return of 15.59%, driven by strategic allocation to commodities and the US dollar index.
- 4-Year CAGR: The fund boasts a compounded annual growth rate of 17.18%, outperforming many traditional investment vehicles.
These figures demonstrate Mansa-X’s ability to adapt to market changes while delivering steady returns.
Is Mansa-X Safe to Invest In?
1. Regulatory Compliance
Mansa-X is regulated by the Capital Markets Authority of Kenya (CMA). In 2018, Standard Investment Bank became the first institution in Kenya to receive a Money Manager license under the Capital Markets Act.
This license allows SIB to manage investments on behalf of clients and ensures compliance with the Capital Markets (Online Foreign Exchange Trading) Regulations, 2017. The CMA actively monitors Mansa-X to ensure transparency, accountability, and investor protection.
2. Risk Management Strategies
Mansa-X employs robust risk management frameworks to protect investors from significant losses. The fund’s diversified portfolio minimizes exposure to specific market downturns, and its active trading model adjusts to market trends in real time.
3. Lock-In Period and Liquidity
Investors are required to commit a minimum of KES 250,000 with a six-month lock-in period. While this ensures stability for the fund, it may limit liquidity for investors needing immediate access to their funds.
4. Transparent Fee Structure
Mansa-X charges:
- 5% Annual Management Fee: Covers operational costs.
- 10% Performance Fee: Applied to returns exceeding 25%.
Although higher than fees for some traditional funds, these charges are justified by Mansa-X’s active management and superior returns.
5. Market Volatility
While Mansa-X mitigates risks through diversification, it cannot eliminate financial market volatility entirely. Returns may fluctuate based on macroeconomic factors, geopolitical events, and market sentiment.
Benefits of Investing in Mansa-X
- High Returns: Mansa-X’s track record of double-digit annual returns is a major draw for investors.
- Diversification: Exposure to both local and international markets reduces risks associated with single-market dependence.
- Regulatory Assurance: Oversight by the CMA adds a layer of security and credibility.
- Active Management: Professional fund managers adjust portfolios dynamically to capitalize on market opportunities.
Challenges and Risks
- High Minimum Investment: The entry requirement of KES 250,000 may deter small-scale investors.
- Fee Structure: The performance fee may reduce net returns for investors.
- Market Dependency: Despite risk management, the fund is still subject to external market conditions.
- Limited Liquidity: The six-month lock-in period may not suit investors seeking short-term gains.
How to Invest in Mansa-X
To invest in Mansa-X, follow these steps:
- Open an Account with SIB: Visit the Standard Investment Bank website or their offices to create an account.
- Submit KYC Documents: Provide identification documents and proof of address as part of the Know Your Customer (KYC) process.
- Deposit Funds: The minimum investment amount is KES 250,000.
- Monitor Performance: Use the Mansa-X dashboard to track your investment’s performance in real time.
FAQs
1. Is Mansa-X regulated?
Yes, Mansa-X is regulated by the Capital Markets Authority of Kenya (CMA), ensuring compliance with industry standards.
2. What is the minimum investment amount?
The minimum investment is KES 250,000, with a six-month lock-in period.
3. How are returns calculated?
Returns are based on the performance of the fund’s diversified portfolio, including local and global assets.
4. Are there risks involved?
Yes, like any investment, Mansa-X carries risks, particularly related to financial market volatility.
5. Can I withdraw my funds anytime?
No, investors must adhere to the six-month lock-in period before withdrawing funds.
Mansa-X is a promising investment option for those seeking diversification, high returns, and professional management. Its compliance with the Capital Markets Authority, combined with a strong track record of performance, makes it an appealing choice for investors with a medium-to-high risk appetite.
However, as with any financial product, potential investors should conduct thorough research and consult a financial advisor to ensure alignment with their financial goals and risk tolerance.
By understanding the fund’s dynamics, you can make informed decisions that align with your investment objectives.
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