Investing in Kenya's capital markets offers various opportunities. The benchmark for secure investments is government securities, such as Treasury bills and bonds, which are favored for their stability and lower risk.
For investors seeking capital appreciation, offshore stocks and exchange-traded funds (ETFs) are attractive options.
These instruments allow access to international markets, offering growth potential that outpaces local alternatives. Meanwhile, local stocks are primarily valued for their dividends, providing a steady stream of income to investors.
Overall, the Kenyan capital market presents a diverse landscape for investment, balancing the relatively high yields of real estate, the security of government securities, and the growth prospects of both local and international equities.
This blend caters to different risk appetites and financial goals, making it a dynamic environment for both seasoned and new investors.
If you have KES 500,000 to invest in Kenya, here’s how different options could grow your money:
1. An infrastructure bond (IFB) with a 15% coupon rate would earn you KES 75,000 annually.
2. A 365-day T-bill at 14% yields KES 52,500 after taxes.
3. Investing in a high-dividend stock like KenGen, with a 17% dividend yield, gives KES 80,500 in dividends after taxes.
4. A money market fund (MMF) with a 14% annual yield provides about KES 62,000 after taxes.
5. SACCO savings with a 10% interest rate on deposits earn KES 47,500 after taxes.
6. SACCO share capital with a 14% dividend rate generates KES 66,500 after taxes.
7. Rental property with a 7% yield could bring in KES 35,000 annually.
These are primarily low-risk, passive investments. For potentially higher returns, consider higher-risk investments, a business, or investing in personal growth.
