A Unit Trust is a vehicle, which pools funds of investors to invest in a diversified portfolio of securities. A Unit Trust provides investors access to professional investment management. Unit Trusts are also tax-free vehicles for Capital Gains and Income Distributions.
Unitholders receive a return on their investment in two ways:
Citizens of Sri Lanka and companies and institutions incorporated in Sri Lanka can invest in all funds. Foreign citizens and companies can invest only in the Ceylon Index Fund, Ceylon Tourism Fund & Ceylon Financial Sector Fund via a Securities Investment Account (SIA). A SIA account enables foreign investors to convert and repatriate capital and profits back into any foreign currency. The SIA account is designed to avoid domestic exchange control restrictions of the Central Bank.
You can begin your Unit Trust investment with as little as Rs 10,000/- (Approx USD 100).
You can turn your units into cash at any time. All you have to do is hand over the signed certificate with redemption instructions to us on or before 4 pm to get the day’s unit price. You will receive a Bank cheque issued in favour your name within 3 working days. The prices are published in the daily Sri Lankan newspapers and our website.
You can turn your units into cash at any time. All you have to do is hand over the signed certificate with redemption instructions to us on or before 4 pm to get the day’s unit price. You will receive a Bank cheque issued in favour of your name within 3 working days. The prices are published in the daily Sri Lankan newspapers and our website.
Both income distributions and capital gains are exempt from tax.
Units are transferable by a request in writing to us. We will then execute the transfer in the unit holders register.
You can purchase units either by yourself or jointly with another person.
Units may be purchased in the name of a minor by the parents or a guardian. Nevertheless, such units may be redeemed only when the minor attains the age of 18.
They are an institution independent from managers who monitor the manager’s conformance with the trust deed and regulatory requirements. They also create and cancel units at the request of managers, have custody of trust assets, and also ensure the registration of unit holders.
The main responsibility of CAM is to manage the funds’ investments according to its objectives. It is also involved in the daily administration and selling units to investors and canceling units when investors divest them.
It is a document which provides investors with important information about the fund. Investors should read it carefully before investing. A prospectus contains descriptions of:
The Net Asset Value (NAV) is the market value of the Funds’ assets net of all costs. It is calculated at the end of each trading day. This total fund value is divided by the number of units issued to calculate the NAV of a unit. The price (value) of a unit is calculated based on the NAV and published daily. Units are bought and sold based on these prices.
As the Fund Manager, CAM is licensed by the Securities and Exchange Commission of Sri Lanka (SEC). The Fund complies with the Unit Trust Code of the SEC. Directives and guidelines issued by the SEC from time to time and the terms outlined in the Unit Trust Deed of each fund. Deutsche Bank acts as Trustee and Custodian of the funds on your behalf.
An “index” is a selection of companies used to measure the performance of a stock market, e.g. ASPI, BSE30, DJIA. An Index Fund is a collective investment pool that aims to track the performance of the portfolio of companies listed on the stock exchange that comprises an Index.
Tracking can be achieved by holding all of the securities in the index, in the same proportions of each company in relation to the total value (Market Capitalization) of the index. An Index Fund earns market returns without the risk of trading and speculation.
Unit prices will rise and fall according to the stock market movements and the fund earns market returns at market risk. However, unlike an active fund manager, the index fund avoids trading risks, speculation, and the risk of the fund manager’s judgement.