A Securities & Exchange Commission of Sri Lanka Approved - - PowerPoint PPT Presentation

A Securities & Exchange Commission of Sri Lanka Approved Investment Manager

1.

Discretionary portfolio management

2.

Unit trust investment

3.

Securitization

4.

First Capital as your fund manager

5.

About First Capital

“Managing client’s fund in the most effective

and secure manner within the investment guidelines specified by the Fund Management Mandate”

CLIENT PORTF RTFOLIO IO

FUND ACTIVE FUND MANAGEMENT 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

• wned by them.”

Investor Investor Investor

Fund

Government Securities Debentures Commercial Papers Trust Certificates

• Governement Securities (TBills/Bonds)
• Corporate Debt (Debenture/CP/SP/Pro-

Notes)

• Fixed Deposits

Fixed Income Funds

• Treasury Bills /Bonds
• Repurchase agreements

Gilt Edged Funds

• Listed Shares
• Fixed Income Securities

Balanced Funds

• Treasury Bills
• Fixed Income Instruments (less than 12

months) Money Market Funds

• Listed Shares

Equity Funds

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.”

Lease 1 Lease 2 Lease n

Leasing ing Compa pany ny Invest stor

Trust Certificate

• 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

• 50

50 100 150 200 2005 2006 2007 2008 2009 2010 2011 2012 2013

Market Liquidity

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 POWER

First Capital group assets under management of LKR 25Bn

ACCESS TO ALL INVESTMENT OPTIONS AVAILABLE

FIRST CAPITAL MARKETS

Margin Lending

FIRST T CAPITAL TAL HOLDI DINGS GS PLC

FIRST CAPITAL LIIMITED

Structuring & Placement, Advisory

FIRST CAPITAL ASSET MANAGEMENT

Fund Management, Unit Trust Management

FIRST CAPITAL TREASURIES

Primary Dealer

FIRST CAPITAL EQUITIES

Stock Broking

THANK YOU