Kicked off on 1st July 2016, the Dry Associates Money Market Fund is now one of Kenya’s leading and fastest-growing money market funds. According to one Cytonn report, Dry Associates Kenya Money Market Fund ranks 5th as of December 2022 in terms of yield rate with an effective annual rate of 9.5%.
Another report ranks Dry Associates Unit Trust at number 8 based on market share, whereby it enjoyed a 2.5% claim during the second quarter of 2022.
What’s more interesting is that Dry Associates’ rate enjoyed a 12.3% Assets under Management (AUM) growth rate that year, which was only bettered by ABSA, Equity Investment Bank, and Sanlam Unit Trust.
But what’s in for you as an investor? Is Dry Associate Kenya the best money market fund for you? We’ll answer that and many more.
Here’s what I’ll cover about Dry Associates Kenya money market fund in this post:
- What’s the Dry Associates Money Market Fund?
- Who should invest in Dry Associates?
- Why should you invest in Dry Associates Kenya?
- How does the Dry Associates Kenya Money Market Fund work?
- What are the downsides of Dry Associates Kenya Money Market Fund?
- How does it perform against others?
Let’s jump in!
In a hurry? Below is the latest Dry Associates Kenya Fund fact sheet
Dry Associates Money Market Fund Kenya Fact Sheet 2023
|Structure Type||Money Market Fund|
|Launch||1st July 2016|
|Fund size||Ksh 2.84 billion|
|No. of holdings||30 (as of 28th February 2023)|
|Regulator||Capital Markets Authority (CMA)|
|Fund manager||Dry Associates Investment Bank|
|Trustee||Cooperative Bank Kenya|
|Minimum investment||Ksh 1 million|
|Minimum top-up||Ksh 250,000|
|Minimum redemption||Ksh 250,000|
|Annualized yield since inception||12.20%|
|Liquidity||3 business days|
|Interest income distribution||Monthly or quarterly|
|Asset Allocation||54.1% Fixed & Demand Deposits, 24.2% Corporate Paper & Bonds, 19.9% Treasury Bills & Bonds, 0.5% Off Shore, and 1.2% Cash|
What’s Dry Associates Kenya Money Market Fund?
The Dry Associates money market fund is a type of unit trust by Dry Associates Investment Bank that invests in low-risk assets like fixed and Demand Deposits, Corporate Paper & Bonds, Treasury Bills, Treasury Bonds, and Cash.
The money market fund was started on 1st July 2016 to focus on Kenya and the wider East Africa region.
Dry Associates’ portfolio focuses on short-term fixed-income securities whose term does not exceed 13 months. The fund size as of March 2023 was Ksh 2.84 billion.
Currently, Dry Associates’ asset allocation is as follows:
- 54.1% Fixed & Demand Deposits
- 24.2% Corporate Paper & Bonds
- 19.9% Treasury Bills & Bonds
- 1.2% Cash
- 0.5% Off Shore
Who Should Invest in Dry Associates Kenya?
As a Unit Trust, Dry Associates Kenya targets specific types of people. First, the money market fund is ideal for individuals looking for regular income, given that the interest income is distributed monthly and quarterly.
Second, Dry Associates also targets individuals looking for liquidity, considering it only takes three business days to get your money.
Third, this money market fund by Dry Associates Investment Bank is a fantastic treasury management option for companies with temporary/short-term excess liquidity, including NGOs and multinationals.
Why Invest in the Dry Associates Kenya?
Dry Associates Kenya is a worthy consideration when looking for a money market fund in Kenya for these reasons:
- High return – The Dry Associates Kenya money market fund enjoys a better yield rate than most funds in Kenya and bank deposits. For example, the annualized yield rate since inception is 12.2%, which is impressive.
- High liquidity – It only takes three working days to have your money once you make a withdrawal request. What’s more, you can withdraw at any time.
- Regular income – Dry Associates distributes interest income to individual investors monthly and quarterly. That means you can have regular income upon investing.
- Low risk – Dry Associates Investment Bank (the fund manager) invests in low-risk fixed-income securities, thus safer. Besides, the Capital Markets Authority regulates the money market fund, and every investment decision the fund manager takes is under the oversight of a CMA-approved trustee (Cooperative Bank).
How Does the Dry Associates Money Market Fund Work?
Like any money market fund, Dry Associates Kenya requires individual investors to pool money that the fund manager (Dry Associates Investment Bank) invests and manages.
Individual investors must make a minimum investment of Ksh 1 million and a minimum top-up of Ksh 250,000. Not only does the fund manager invest and manage the pooled fund, but they also advise investors.
The fund manager, however, does not keep the money. That’s the custodian’s job (Standard Chartered), and to ensure the fund manager is accountable for the investment decisions they make, the trustee (Cooperative Bank) performs an oversight role.
The other key player is the auditor (Deloitte), who reviews the fund’s financial records.
Dry Associates pay interest income monthly and quarterly, but investors can withdraw anytime and have the funds within three business days.
What Are the Downsides of Dry Associates Kenya?
The biggest downside with Dry Associates Kenya is that the money market fund is too expensive to invest and almost non-investible. For one, it takes a minimum stake of Ksh 1 million to join the fund, and you can only top up a minimum of Ksh 250,000.
Obviously, not many Kenyans can afford to spend a million Kenyan shilling on a money market fund. You’ve to be a millionaire to do it!
The other issue is that the yield rate is unpredictable. You can’t tell how much the return rate will be; not even the fund manager can guarantee that. But judging from history, the annual yield has been above the market average, making the gamble worth it.
Dry Associates Fund Performance Compared to Others
The table below shows how Dry Associates compare to other money market fund in Kenya in terms of yield rate as of 9th December 2022
|Rank||Money Market Fund||Effective Annual Rate|
|1||Cytonn Money Market Fund||10.7%|
|2||Zimele Money Market Fund||9.9%|
|3||NCBA Money Market Fund||9.8%|
|4||Apollo Money Market Fund||9.5%|
|5||Dry Associates Market Fund||9.5%|
|6||Sanlam Money Market Fund||9.5%|
|7||Nabo Africa Money Market Fund||9.4%|
|8||GenCap Hela Money Market Fund||9.4%|
Clearly, Dry Associates performs pretty well against traditional giants like Cytonn, Zimele, and Apollo. While the reported effective annual yield rate as of 9th December 2022 was 9.5%, as shared in the above table, the rate at the end of 2017 was 9.3%.
Meanwhile, the annualized yield rate since inception is 12.20%, which is remarkable. It shows that Dry Associates perform better than most money market funds.
Growth Rate and Market Share
Dry Associates Kenya is among the fastest-growing Unit Trusts in Kenya. Though it doesn’t take the largest share – that is, assets under management (AUM), it ranks pretty well, as the table below shows:
|Rank||Unit Trust Provider||Market Share Q2 2022||AUM Q1–Q2 2022|
You can contact Dry Associates to inquire about the fund using any of these routes:
- Dry Associates Headquarters – 188 Loresho Ridge
- Phone – 020 445 0520/020 445 0521/0705 849 429/0738 253 811
People Also Ask
1. Which Are Among the Best Money Market Funds in Kenya?
Based on the effective annual yield rate, the best money market funds in Kenya include Cytonn, Britam, Adam Capital, Madison, ABSA, and Zimele money market funds. Others are Sanlam, Nabo Africa, Apollo, Old Mutual, and Dry Associates money market funds.
2. How Profitable Is a Money Market Fund?
Money market funds promise a better yield rate than traditional savings accounts, and the risk is much lower. While there are no return guarantees, you can make some good returns on investments, making them profitable.
3. How Are Money Market Funds Paid?
Money market funds hold securities that allow investors to earn returns in terms of interest income or capital gains in case of sales.
Shared are the basics of the Dry Associates Money Market Fund. You can therefore use the information to decide if Dry Associates is worth investing in.
From our evaluation, we think the money market fund is worth it if you can raise the investment amount. But if you can’t, there are other money market funds in Kenya that you can consider, and we’ll be happy to help.
Talk to us on social media, and we’ll join the conversation and hopefully help you make the correct investment decision.