A Securities & Exchange Commission of Sri Lanka Approved Investment Manager
Discretionary portfolio management 1. Unit trust investment 2. Securitization 3. First Capital as your fund manager 4. About First Capital 5.
“ Managing client’s fund in the most effective and secure manner within the investment guidelines specified by the Fund Management Mandate” ACTIVE FUND MANAGEMENT FUND CLIENT PORTF RTFOLIO IO SPECIAL POWER OF ATTORNEY
1. Special power of attorney To operate the bank account under client name and make/execute investments 2. Bank account A current account will be opened under the client name. All transactions will go through this account 3. Ownership of Securities Ownership of securities lies with the client 4. Active fund management Investments are made and liquidated actively to maximize the return instead holding till maturity 5. Regulated by SEC Monthly reports to SEC, regular audits, directions, submission of monthly and annual financial statements and regulation over staff
6. Fund management agreement Agreement between investor and First Capital 7. Investment Plan Sets out investment parameters including the fee structure 8. Reporting A fund performance report which consist of investment balance and income earned will be circulated on a monthly basis 9. Portfolio A collection of different types and/or different maturities of investments. Portfolio is maintained ensuring highest return, maximum security and liquidity. Investments can include government securities , debentures, trust certificates, commercial papers as appropriate
1. Clients benefit from the expertise the Fund Manager Expertise include knowledge on different types of investment instruments, risk management, research capabilities and techniques (buy/sell agreements etc) 2. Clients can concentrate on their core business and save time Fund management company will handle all investment decisions and administration on behalf and to the best interest for the client 3. Higher bargaining power to the fund Client fund is leveraged on the fund management company’s bargaining power to attract best interest rates which is otherwise not available if invested individually 4. Access to all investment options available in the market Fund managers regularly interact with market participants (issuers and participants) and thus have knowledge and access to all investment opportunities available in the market 5. Access to knowledge on the entire spectrum of investment environment Fund manager keeps up-to-date with all variables affecting investment environment such as interest rates, inflation rate, foreign exchange, market liquidity and etc.
“ A Unit Trust is a pool of funds collected from a number of investors and invested in various financial assets such as treasury bills, treasury bonds, debentures, commercial papers, shares and other financial securities. The income earned from these investments and the capital appreciation is shared by its unit holders in proportion to the number of units owned by them. ” Government Securities Investor Commercial Papers Fund Investor Trust Certificates Investor Debentures
• Governement Securities (TBills/Bonds) • Corporate Debt (Debenture/CP/SP/Pro- Fixed Income Funds Notes) • Fixed Deposits • Treasury Bills /Bonds Gilt Edged Funds • Repurchase agreements • Listed Shares Balanced Funds • Fixed Income Securities • Treasury Bills Money Market Funds • Fixed Income Instruments (less than 12 months) Equity Funds • Listed Shares
12 Months Ending Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 First Capital Wealth Fund % 13.49 13.54 14.12 13.68 14.01 13.95 14.93 15.10 15.57 15.49 17.40 17.49 17.70 21.34 TBill Annual Rate % 10.80 10.61 10.55 10.57 10.38 9.78 8.87 7.36 7.09 7.06 7.04 7.02 7.00 6.84 Relative Performance 2.69 2.93 3.57 3.11 3.63 4.17 6.06 7.74 8.48 8.43 10.37 10.47 10.70 14.50
*Data based on independent publication by Unit Trust Association
1. Exceptional returns The First Capital Wealth Fund comfortably managed to maintain its position as the best performing fixed income unit trust fund since December 2013. YTD performance for July 2014 exceeded 21%. 2. Tax free return The income earned from unit trust is exempted from income tax. 3. Minimum risk FCWF invest only in fixed income securities and have no exposure to equity. Investments are sufficiently diversified in a bundle of investments including government securities, listed debentures and leased backed trust securities. 4. Liquidate Compared to other long term available investment opportunities, units can be redeemed to the FCWF at any time with a nominal exit fee. Loans can be obtained pledging units as a security. 4. SEC’s role as a regulator SEC plays a vital role in monitoring all aspects of the unit trust including monthly financials , advertisements and even qualifications of fund managers. 5. Trustee Bank of Ceylon acting as the trustee monitors all transactions carried out by the fund on a daily basis.
“ Asset-backed securitization combines mortgages into one large pool and divide the large pool into smaller Trust Certificates and then sell those smaller pieces to investors. The process creates liquidity by enabling smaller investors to purchase shares in a larger asset pool. Investors who may not be able to afford to buy into a large pool of mortgages can thereby purchase portions of a mortgage as a type of bond. ” Trust Invest stor Certificate Lease 1 Leasing ing Lease 2 Compa pany ny Lease n
Higher security to the investment – asset backed and trustees involvement • Higher return • Possibility of earning cap gains • Ability to obtain a loan (reverse repo) • Higher liquidity – negotiable instrument • Ability to invest in relatively small amounts • Ability to customize trust certificates to match investor requirements •
Market Liquidity 200 150 100 50 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 -50
EXPERTISE Over 30 years experience in the financial services • Expertise in government securities, debentures, trust • certificates, commercial papers, stock broking, unit trust management Strong group research unit • Professionally qualified staff with a wealth of hands on • experience in the market Robust corporate governance practices lead by an • eminent panel of board of directors Controls over all investment decisions by the investment • committee BARGAINING First Capital group assets under management of LKR 25Bn POWER ACCESS TO ALL INVESTMENT OPTIONS AVAILABLE
FIRST CAPITAL FIRST CAPITAL LIIMITED MARKETS Structuring & Placement, Margin Lending Advisory FIRST T CAPITAL TAL HOLDI DINGS GS FIRST CAPITAL PLC ASSET FIRST CAPITAL MANAGEMENT EQUITIES Fund Stock Broking Management, Unit Trust Management FIRST CAPITAL TREASURIES Primary Dealer
THANK YOU
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