April 07, 2021: The fast-growing asset management arm of the Softlogic Group, Softlogic Invest is pleased to announce that their Money Market Fund has been assigned a rating of “[SL] A mfs” (Sri Lanka A rated mutual fund scheme) by ICRA Lanka Limited.
The fund that commenced operations in July 2020 has performed well despite the obstacles of the pandemic and as of 25th March, 2021, the Softlogic Money Market Fund has surpassed Rs. 1.5 billion in Assets under Management with over 1,300 unitholders, delivering an annualized current yield of 7.40%. These returns are delivered while maintaining over 80% in category A investments, which include A, A-, AA+ instruments.
“We are delighted that as a brand new entrant to the Unit Trust Mutual Fund business, the Softlogic Money Market Fund received an exceptional rating of ICRA SL A. When managing external funds we felt that showing return against risk is imperative to prospective investors as pure-play yield comparison is simply not informative enough to our investor base. We are keen on educating our investors on the value, transparency and significance of this external rating by ICRA through all our client communications,” stated Softlogic Invest Chief Executive Officer and Director Niloo Jayatilake.
Launched in July 2020, Softlogic Money Market Fund is an open-ended Unit Trust Fund approved by the Securities and Exchange Commission of Sri Lanka (SEC). The fund invests in government treasury bills, bonds and other government securities, investment grade corporate debt securities such as debentures, commercial papers, securitization papers and repurchase agreements with maturities of less than one year which can be readily convertible to cash. The overall objective of the Fund is to earn a return of interest income while preserving investor capital and liquidity.
Commenting on the significance of the rating, Softlogic Invest Portfolio Manager Daham Hettiarachchi opined, “This outstanding rating signifies our attempt to deliver optimum returns given the current low-rate environment and COVID challenges. We adopt a more conservative strategy when allocating funds whilst ensuring that our Unit holders are able to access attractive returns. With this approach, we are currently delivering a return well above traditional non-bank fixed deposit rates and savings rates. Therefore, our investors enjoy optimum yield compared to traditional NBFI fixed deposit rates whilst enjoying the flexibility of withdrawal at any time they want without any charges. We believe that customer convenience and access to funds is paramount to grow Industry volumes.”
ICRA Lanka’s mutual fund rating methodology is based on evaluating the inherent credit quality of the fund’s portfolio. Schemes with this rating are considered to have adequate degree of safety regarding timely receipt of payments from the investments that they have made. The credit risk ratings incorporate ICRA Lanka’s assessment of a debt fund’s published investment objectives and policies, its management characteristics, and the creditworthiness of its investment portfolio. The organisation reviews relevant fund information on an ongoing basis to support its published rating opinions.
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