Thursday, 1 June, 2023

Uganda Treasury Bonds

What is the TOLEA Exchange-Traded Fund?

ALTX, in partnership with Tolea Securities Ltd, is offering Ugandans an affordable and hassle-free investment option with the Tolea Exchange Traded Fund.

This security gives you access to bonds of various maturities and assets with a single investment.

What is an Exchange Traded Fund?

A single asset is created out of a collection of existing, known and priced assets such as bonds or stocks. Once formed into a single asset (ETF), it is then divided into shares that can be bought and sold on the exchange.

Why should I invest in the TOLEA ETF?

Low effort

The Tolea ETF is passive investment at its finest.
The Tolea ETF is made up of a variety of bonds to cover a range of maturity periods and returns. The ETF automatically reinvests all interest earned, and replaces all matured securities. In other words, no more decisions about what to invest in, and what to do with your payments.
With one investment, your portfolio is sorted.

Reduced Costs

No transaction fees for reinvesting.
One transaction gives you broad exposure to the market. No need for multiple transactions to balance your portfolio.
‍Additionally the fund has significantly lower annual fees as compared to the Management Fees charged by some unit trusts.
‍The ETF is one of the most affordable investment options available on the market today.

 

 

Diversification

Be smart about risks. Investing comes with some unknowns, but spreading your money between assets means one or two shocks won’t wipe out all your hard earned gains. The ETF is backed by bonds that offer you less risk and volatility in comparison to an ETF made up for riskier assets such as stocks.

Visible Growth

Benefit from the growth in value of your shares over time.
The Tolea ETF Fact Sheet is released daily so you can literally watch your money grow. This is a transparent investment so you know exactly how your money is moving.

Buy and Sell Freely

Buy and sell your holdings at any time.

Tolea ETF shares are freely transferable. Additionally, the ETF is an asset that may also be used as collateral. With our Direct Market Access platforms, you can log in, view the price and invest in minutes. No middlemen, no paperwork, no wait times.

How do I make money from my ETF?

Reinvestment:

The value of your investment grows consistently because the interest payments earned from the bonds in the ETF are reinvested.

 

Selling:

To access the proceeds from your investment, you will need to sell a portion or all of your ETF units.

What are the factors that could affect the returns on my ETF?

Interest rates

Bonds and interest rates move in opposite directions and are sensitive to changes in interest rates which impact their value. Bonds will trade at a discount when interest rates are rising and at a premium when interest rates are falling. For example: If new bonds are issued at higher interest rates than the bonds you already own, the value and demand for your bonds will decrease.

Credit risk

Credit risk refers to how likely it is that an investor will lose money from their investment. While bonds are at lower risk than most investments, none of them is risk-free and ALTX cannot guarantee that the government will honour its debts.

How do I sell my ETF shares?

DMA investors:

Sell your bonds on our self-service channels, uTrade and ALTX Mobi or contact us to for assistance at info@altxafrica.com

Brokered investors:

Contact your broker and request the sale on your behalf.