NGIS M-Fund projected to record 16% annual return by close of 2021

New Generation Investment Service projected to record 16% annual return
Prof. Kwaku D. Kessey

The managers of the New Generation Investment Service (NGIS) Money Market Fund anticipates an annualized return of 16% by the end of 2021, after posting a positive net return in the 2020 year under review.

Despite the adverse effect of COVID-19 on almost all sectors of the global economy, the Fund realized an 8.5% appreciation of in Net Asset Value, from approximately GH¢3.4 million recorded in 2019 to a little over GH¢3.66million during the year under review. The development therefore brought the Net Asset Value per Share to GH¢0.6729 in 2020, from the previous year’s figure of GH¢0.5773. This represents an annual yield of 16.56 per cent.

However, the economic recovery from the 3rd quarter of 2020, after easing of COVID-19 restrictions, negatively impacted on the Fund’s investment income. It decreased by 15 percent, from GH¢668,496 realised in 2019 to GH¢566,333 in 2020.

The Chairman of NGIS Money Market Fund, Prof. Kwaku D. Kessey, in a statement to the shareholders, during the second Annual General Meeting (AGM) of the Fund, noted that in spite of the economic turmoil caused by the pandemic, management and operating expenses improved.

The 2nd AGM of the Fund should have come off in 2020 but had to be delayed due to the COVID-19 scare around the time. The pandemic badly affected the local economy which was recorded to be one of the fastest-growing economies during the first quarter of 2020.

Prof. Kessey acknowledged that “signs of recovery during the 3rd quarter were beginning to show after the lifting of restrictions and the introduction of strong policy support.

This is supported by data based on the Ghana Statistical Services’ release in the 3rd quarter which showed that the provisional GDP growth contracted by 1.1% compared to a 3.2 % contraction in the second quarter. The recovery of the economy from the 3rd quarter of 2020 was evidenced in the annual growth of 11.9% of the Composite Index of Economic Activity in November 2020 compared to 3.4 % growth in 2019.

Also, headline inflation eased from 10.1 per cent in October to 9.8 % in November 2020 but rose to 10.4 % in December 2020. In addition, the overall budget deficit of 10.8 per cent was recorded as of November 2020 against a projected figure of 11.4 % of GDP.

Notwithstanding these, the Fund showed positive performance. It is at the back of this that Prof. Kessey entreated shareholders to take advantage of the positive outlook and buy more shares to increase their holdings in the Fund.

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