Old Mutual Zimbabwe launches Exchange Top Ten Exchange Traded Fund

From left Majorie Mayida, Caroline Sandura, Sam Matsekete, Hon Mthuli Ncube, Dr Kennedy Mandevhani

Old Mutual Investment Group Zimbabwe (Private) Limited has officially launched the Old Mutual Zimbabwe Stock Exchange Top Ten Exchange Traded Fund. The Old Mutual Zimbabwe Stock Exchange Top Ten Exchange Traded Fund is the first Exchange Traded Fund in Zimbabwe, heralding a new era on the Zimbabwean capital markets. 

The Minister of Finance and Economic Development, Prof. Mthuli Ncube, who was the guest of honour, said investing lies at the heart of the Zimbabwean economy and any other economy in the world. The government played a key role in ensuring the protection of investments, and that there was a wide choice of investment vehicles that investors can choose from.

The Minister said that as they introduced more new products into the market, so did opportunities to develop and grow the economy in line with the Government’s vision to achieve upper-middle-income society status by the year 2030.

The Minister sent a message out to other capital market players in Zimbabwe for them to take advantage of the growing number of investment vehicles that are now available in the country.  

“Other players should take advantage of the apparent traditional advantages of exchange-traded funds in terms of liquidity, low fees, transparency, and potential tax advantages,” he said.

Speaking at the same occasion, the Old Mutual Zimbabwe Chief Executive Officer, Sam Matsekete, said that they first thought of creating the Exchange Traded Fund in 2018, however, the legislative framework needed to be in place first. 

“We are glad that the Zimbabwe Stock Exchange shared in our vision, and Old Mutual. To them and our partners, and to all those who worked with us towards the establishment of the Old Mutual Zimbabwe Stock Exchange Top Ten Exchange Traded Fund…” he said.

Exchange Traded Funds, or ETFs, are fully funded, open-ended, listed securities which track the performance of a specified security or other assets, such as indices, commodities, currencies or any other acceptable asset. Through one investment in an ETF, investors can get access to, for example, the whole market, a specific sector they are interested in, different asset classes or an investment theme as designed by the sponsoring fund manager. 

The Old Mutual Zimbabwe Stock Exchange Top 10 ETF is an ETF that tracks the Zimbabwe Stock Exchange Top 10 Index, by investing in the Top 10 stocks in their exact weights as in the index.

Mr Matsekete said that the Old Mutual Stock Exchange Top Ten Exchange Traded Fund give a range of benefits to individual investors. With ETFs, investors can choose the investment theme that speaks to them and cater to their interests instead of needing to shop around. Stockbrokers create the ETF the investor is looking for, and it’s easy to understand what you are buying.

“Old Mutual will provide this bespoke feel, offering our customers the best counters on the Zimbabwe Stock Exchange. There is robust regulation in place, with the first level of regulation provided by the Zimbabwe Stock Exchange. There is additional regulation provided by the Collective Investment Scheme under which they license EFTs. There is high transparency with EFTs. And that investors can enjoy diversification,” Matsekete said. 

Farai Mpofu, speaking on behalf of the Securities and Exchange Commission of Zimbabwe CEO, said that they valued their role as an enabler in the market.

“An important part of our mandate as the regulator is to encourage our sector players to come up with initiatives, products and services that ensure growth and choice for the investment community.”

Old Mutual Investment Group Managing Director, Majorie Mayida said they are truthful to the client mandate and are always in the market for opportunities to further enhance product offering and returns to our clients.

“It is against this background that we identified a gap in the market for Exchange Traded Funds, hence the decision to develop this product for our market we at Old Mutual Investment Group Zimbabwe (Private) Limited remain committed to broadening our product offering and we hope to be launching other products in the future. And that we continue to play our role as an anchor and partners in the economic development of Zimbabwe,” she said.

The launch of the Old Mutual Zimbabwe Stock Exchange Top Ten Exchange Traded Fund is one more step in strengthening the foundation for the continued development of the Zimbabwean market.

Old Mutual Zimbabwe continues to innovate into the future, acting according to the needs of a changing market, and providing value for our customers and shareholders. It will thrive to innovate into the future, acting according to the needs of a changing market, and providing value for customers and shareholders.

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