SEC keeps investors in dark over Fund Managers schedule

High-Networth Individuals (HNIs) who are major clients of Fund Managers in the Collective Investment Scheme (CIS) space of Nigeria’s capital market, have in the past 18 months bet in the dark due to regulatory oversight by the Securities and Exchange Commission (SEC) over Fund Managers monthly investment schedules, BusinessDay can disclose.

Since the risk of playing directly in the stock market became conspicuously high, the apex and self regulatory organisations in Nigeria’s capital market have raised their ante in the call for retail investors to access the market through a Collective Investment Scheme.

Sometimes called “Mutual funds”, a Collective Investment Scheme is a type of investment scheme that involves collecting money from different investors and combining all the money collected to fund the investment.

While the push in favour of Collective Investment Scheme garners momentum, the last time SEC updated investors on their Fund Managers monthly investment schedule was in October 2012, a development which makes it difficult for unit holders of various funds that are being managed by their fund managers to identify the entry and exit periods in the high-risked market.

Fund Managers monthly investment schedule gives unit holders first hand information on activities of their fund managers around equities, fixed income, money market, real estate, and other funds –like balanced based funds, and ethical funds.

It also gives investors an idea of the percentage of cash that is idle –not being invested by the Fund Managers.

As at April 11, 2014, the Net Asset Value (NAV) of these mutual funds was N170.858billion, against N170.801billion as at April 4, 2014. In this huge market, the SEC has only succeeded in disclosing the Net Asset Value of funds, their unit price, earnings after tax, number of units available, their earnings per unit, and their Net Asset Value per unit; while many investors still look out for how the Fund Managers allocate their resources across various funds.

Fund Managers who are playing big in the Collective Investment Scheme are: Stanbic IBTC Asset Management Limited; Asset & Resources Management Company Limited; FSDH Asset Management Limited; Investment One Financial Service Limited; FCMB plc; Sterling Capital Market Limited; Chapel Hill Denham Management Limited; UBA Asset Management Limited; Alternative Capital Partners Limited; Cashcraft Asset Management Limited; Zenith Capital Limited; Afrinvest West Africa Limited; BGL Asset Management Limited; SIM Capital Alliance Limited, and FBN Capital Asset Management Limited.

Others are: Kakawa Asset Management Company Limited; SFS Capital Nigeria Limited; Union Homes Saving & Loans plc; CDL Asset Management Limited; Lotus Capital Limited; DVCF Oil & Gas plc; Vetiva Fund Managers Limited; and New Gold Managers (Proprietary) Limited.

Considering the rob-off effect of non-disclosure of Fund Managers monthly investment schedule since October 2012 on the regulatory push to access the capital market via Mutual Funds, a market analyst who  berated the parties involved ans said, “Just like the global markets, Nigeria is not in isolation.

“Investment is driven by information from operators and regulators. Even investment advisers act on information available to the market,” he said, adding that “In the stock market, you can easily identify the stockbrokers whose clients are major buyers of Nigerian equities. I expect such information flow to drive the CIS market”.

Iheanyi Nwachukwu