Inflation-fighting Remains a Priority for Swazi investors

Top priority for most Swazi savers, investors and retirement fund members is still the 'inflation-proofing' of their financial products. This is confirmed by STANLIB Swaziland, the unit trust innovator that has been represented in Mbabane since 1999. It is linked to the Johannesburg-based STANLIB, the region's largest unit trust company with billions under management.

STANLIB Swaziland Business Development Manager Mandla Ndlovu comments: "We constantly feed market intelligence back to the group as we have expertise in a wide variety of markets, including equities, bonds, the money market and property. We also offer Africa 's widest range of unit trusts.

"We can therefore design a product to meet very precise local needs. This means we never stop assessing the priorities of our clients and time after time their prime objective is medium-to long-term investment returns that have good prospects of keeping pace with prevailing inflation."

He says in recent years, the inflation rate has been nowhere near double digits, but real or absolute returns versus CPI remain key to all savings and investment strategies. Ndlovu adds: "Retirement fund trustees tell us the same thing - their members want a nest-egg that will not be massively reduced by inflation."
Consumer feedback such as this explains the marketing strategy at STANLIB Swaziland.

Among the first products made available to individual and institutional investors was its Swaziland Money Market Fund. By pooling money in the fund, extremely large capital sums are built up which can then be invested in the money market at wholesale rates. These rates are much higher than a 'retail' or individual rate that would be earned on the small sums that a thrifty family might put away.

Interest mounts up day by day and is constantly compounded. As a result, those institutions and individuals who commit to the Swaziland Money Market Fund achieve enhanced returns every month. Bigger returns are not secured at the price of a big risk of capital loss. The fund invests in liquid assets and money market instruments offered by the major banking groups - greatly reducing the investment risk. Ndlovu notes: "This option achieves returns significantly higher than traditional savings accounts, giving the unit trust-holder a better chance of keeping pace with inflation; especially when the investor commits to medium-term exposure to the money market. "This product has been a firm favourite from the moment of its introduction. In view of the Swazi savers inflation-fighting priorities, we expect this situation to continue."

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