Made in Kenya

-Mobius Kenya plus what is money market fund

 Welcome to TechKona!!

Hello to the 9 new subscribers who have joined our community since the last edition.

Happy Monday! A great week awaits.

In todays email:

  1. Learn of Kenyan car manufacturer Mobius motors.

  2. What is Money Market Funds.

Mobius Kenya.

Have you heard about Mobius, a Kenyan company crafting locally-made luxury cars that rival the likes of Land Rover? Stay with us to discover more about this remarkable Kenyan enterprise.

Mobius Motors is a Kenyan start-up that designs, manufactures and sells vehicles built for Africa. The company’s headquarters and showroom are located at Sameer Business Park off Mombasa Road in Nairobi. Their mission is to create a new class of vehicles that are affordable, durable and versatile for the African market.

Founded in 2011 by Joel Jackson, a British entrepreneur who moved to Kenya to work for a non-governmental organization. Jackson realized that there was a huge gap in the market for vehicles that could handle the rough roads and harsh conditions of Africa, while also being accessible to the growing middle class. He decided to create Mobius Motors, a company that would leverage local talent, resources and innovation to produce vehicles that are tailored to the needs and aspirations of African consumers.

Mobius Motors has two famous models of vehicles: the Mobius 2 and the Mobius 3. The Mobius 2 is a utility vehicle that was launched in Kenya in 2015. It has a robust space-frame, rugged suspension and proven engine that enable it to handle rough roads reliably. It also has a simplified and modern design, with an optional infotainment system that connects to Wi-Fi and smartphones.

The Mobius 3 is the latest model of Mobius Motors, launched in 2022. It is an upgrade of the Mobius 2, with improved performance, comfort and safety features. It also has a more spacious interior, a larger boot capacity and a higher ground clearance.

Both models of Mobius Motors are designed, manufactured and sold in Kenya, creating jobs and opportunities for local people. Mobius Motors also provides aftercare support and customer care for its customers, ensuring that they have a smooth and enjoyable driving experience.

You can also book a test drive or join their ambassador program to spread the word about their amazing vehicles.

Money Market Funds.

Have you heard of Money Market Funds (MMFs)? My friend and business partner, Benjamin, introduced me to them. Intrigued, I began researching MMFs and decided to include them in today's newsletter. Let's explore what MMFs are all about together.

In Kenya, MMFs have gained significant popularity as investment vehicles. This is primarily because they allocate their investments into highly liquid assets such as cash equivalents, government securities, and top-rated debt-based securities, ensuring a notable level of safety for investors. Additionally, they tend to provide more attractive returns compared to conventional savings accounts.

This article covers the following topics:

  • Structure of Money Market Funds

  • Money Market Funds Ecosystem

  • Performance of Money Market Funds

  • Reasons for Investing in Money Market Funds

  • Selecting a Reliable Fund Manager

    1. Structure of Money Market Funds

A Money Market Fund (MMF) is like a collective investment pool managed by an experienced Fund Managers. This experts takes the money you invest in the fund and spreads it across various local assets, commonly known as Money Market Instruments. These assets include:

  • Commercial Paper: This is issued by businesses to cover their short-term cash flow needs.

  • Treasury Bills (T-bills) and Treasury Bonds: These arise when the government borrows money from the public for various purposes.

  • Fixed Deposits: These are funds you deposit in commercial banks for a fixed period.

Imagine a Money Market Fund as a large pie. When you purchase units of the MMF, you're essentially getting a slice of this pie, which consists of commercial paper, treasury bills, and fixed deposits. This ownership qualifies you as a unit holder, giving you a share in the MMF's returns and assets.

2.Money Market Funds Ecosystem

  • Professional Fund Manager: A registered and regulated company responsible for managing investments according to the fund's objectives.

  • Custodian: The bank entrusted with investors' funds, ensuring adherence to the fund's policies.

  • Trustees: Individuals or institutions safeguarding investor interests and holding the Fund Manager and Custodian accountable.

  • Auditor: Responsible for auditing financial statements, crucial for investor evaluation.

These entities collectively ensure the safety and reliability of MMFs. When selecting an MMF, consider the credentials of these key players.

3.Performance of Money Market Funds

Money Market Funds are attractive investments due to their safety and solid returns, surpassing traditional banks. These funds prioritize safety while offering liquidity as they invest in easily convertible short-term securities.

Most Money Market Funds yield returns from 7.0% to 10.6%, outpacing the 6.5% inflation rate and exceeding bank deposit returns (average 8.9% vs. 6.4%).

4.Reasons for Investing in Money Market Funds

  • Diverse Investment Options: Fund managers have a range of investment options, diversifying portfolios and ensuring equitable returns.

  • Competitive Returns: MMFs typically offer attractive returns, averaging 8.9%, surpassing both inflation rates (6.5%) and current account interest rates.

  • Liquidity: MMFs invest in short-term securities, offering investors quick access to cash, enabling easy entry and exit.

  • Regulatory Oversight: CMA regulations ensure compliance, with separated roles of Fund Manager, Custodian, Trustee, and Auditor enhancing security.

  • Professional Management: MMFs benefit from professional management, with decisions based on thorough research and continuous portfolio monitoring.

  • Low Minimum Investments: Most MMFs accept low minimum investments, starting as low as Kshs 1,000, making them accessible to a wide range of investors.

  • Cost-Efficiency: The pooled nature of MMFs reduces costs per investor, achieving economies of scale in research, transactions, and investments.

  • Diversification: MMFs provide access to a broader range of securities, reducing individual investor risk.

  • Savings Culture: Regular contributions to MMFs can cultivate a savings habit, promoting financial stability when needed.

    5 Selecting a Reliable Fund Manager
    Here are some of the things that you should consider before putting your money in a MMF.

  • Fund Management: Assess the fund manager's expertise and track record.

  • Minimum Investment: Ensure the initial investment aligns with your budget.

  • Liquidity: Consider how quickly you can access your funds when needed.

  • Customer Service: Evaluate the quality of customer support for inquiries and assistance.

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