Why Invest Now – Should I Be Thinking Long – Term?

Financial markets may be performing poorly. Why should I invest now? Should I be thinking long-term too? 

The answer is simple: investing during market lows means getting a lower price for your investment. It is like shopping during discount sales on Black Friday. When financial markets start to recover, which they always do, your investments have a greater chance of earning bigger returns. When you start investing, you also should aim to stay invested for the long term. Doing so will earn you more money because of compounding. For example, if you invested GHC 500 monthly for 30 years, instead of for just 20 years, at 15% per annum — you would end up with an extra income of GHC 2,686,932 from the additional 10 years of staying invested.  

The Sentinel Africa Eurobond Trust invests in USD-denominated securities to provide investors with capital appreciation and competitive returns to help them build wealth over the long term. Today, we are excited to announce the addition of the Sentinel Africa Eurobond Trust by Sentinel Asset Management to Achieve! 

About the Sentinel Africa Eurobond Trust 

The Sentinel Africa Eurobond Trust is a moderate-risk unit trust scheme that provides investors with an appetite for USD-denominated securities access to such securities, which would otherwise be beyond of their reach due to the minimum investment amount needed to make such investments. The securities held in the scheme have an average maturity of between 10 to 25 years. The scheme is actively managed by Sentinel Asset Management, an SEC-licensed asset management and investment advisory company. Sentinel is responsible for the day-to-day investment decisions of the fund. These decisions are based on the goal of the scheme – to provide investors with a diversified income stream while ensuring long-term capital appreciation. This makes the fund suitable for investors investing towards their long-term goals and can tolerate the risk that comes from the volatility of the bond market. 

Key facts about the Sentinel Africa Eurobond Trust 

Fund Size	GHC  916,000
Initial Investment Amount	GHC 100
Top-up Fee	The scheme does not charge customers for making top-ups. NB: Payment service provider may charge for customer top-ups)
Withdrawal Fee	The scheme receives fees on early withdrawals:  3% on withdrawn funds during the first year of investment;   2% during the second year and no charge after the second year.   NB: The withdrawal fees highlighted above will be waived on all investor withdrawals in the first six (6) months after signing up.
Withdrawal Processing Time	Up to 5 working days
Management Fee	The total fees to maintain the active management of the scheme is 2.5% per annum (that’s GHC 2.5 for GHC 100 invested for 1 year), and are inclusive of other costs associated with managing the scheme such as custodians, auditors, trustees, and legal advisors. Achieve does not charge customers any fees.
Inception Date	May 2022
Fund Type	Fixed Income Fund
Currency	GHS

 

How do you make money in the Sentinel Africa Eurobond Trust? 

You make money in two ways: 

• Income: When the underlying securities (Eurobonds & Fixed deposits) that the scheme invests in pays interest, the scheme distributes those earnings to its investors. You will earn a portion of that interest if you have funds in the scheme at the time of the distribution. 

• Capital gains: When the scheme sells an underlying security at a price higher than what was initially paid, the scheme makes a profit. When the scheme’s total profits exceed its total losses, it realizes a “net capital gain” and distributes those gains to its investors.  You will earn a portion of the capital gains if you have funds in the scheme at the time of the distribution. 

The above suggests that whenever you withdraw from the scheme, you forfeit any future interest and capital gains that will be paid out to you. To ensure that you make more money from the scheme and benefit from compounding, we recommend staying invested in the scheme for at least 2 years. 

Here’s how to use the Sentinel Africa Eurobond Trust to build wealth: 

1. Link your long-term goals on Achieve to the Sentinel Africa Eurobond Trust. E.g., Retirement savings, building project funds etc. 
2. Automate your top-ups into the Sentinel Africa Eurobond Trust. Schedule your top-ups to be deducted from your bank account one (1) day to three (3) days after you expect to get paid. 
3. Invest only long-term money into the fund. Here’s some easy logic to consider how much long-term savings is right for you: keep enough cash on hand for your monthly expenses and emergencies (around 3 – 6 months’ worth). Invest this short-term money in the Digisave (Plus Income Fund). And invest the excess cash in the Sentinel Africa Eurobond Trust. 

NB: Like other unit trust schemes that hold bonds, the scheme is subject to interest rate risk; increases in interest rates may cause the price of the bonds in the scheme to decrease, reducing the scheme’s value. However, the fund manager aims to hedge against this risk by diversifying the assets held in the scheme.