Today, we are going to look at how to invest in Kenya. There are a variety of ways where one can earn significantly good returns without investing too much time.
Kenya makes up for more than 50% of East and Central Africa’s regional GDP. Our economy is strong and growing each year as a result of the growth of the urban middle class.
On top of all this, the government has made it easy to invest in Kenya by reducing bottlenecks initially aimed at chasing away investors.
Therefore, making an investment in Kenya in 2020 is the wisest choice that one can ever make.
How to invest in Kenya – Top places to invest
Sometimes, you do not have to have a lot of money to think about investing. With as little as KES 10,000, you can start your way to financial freedom. Let’s look at how to invest in Kenya.
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The Money Market
Investing in the money market is trading in short term debt instruments. This is just an investment in cash. Investors will earn interest rate as determined by the company they chose to use.
These days, it is very easy to invest in the money market as investment firms and insurance companies are offering this. What’s more, is that there are even mobile applications that offer this service to customers.
Some of the best firms offering the best interest in money market investment include:
- Cytonn Investments – 11% interest rate Per annum
- Britam money market fund – 8.5% interest rate per annum
- CIC Insurance money market fund – 9.4% interest rate per annum
Read More: Money Market Funds in Kenya 2020
2. Treasury bonds
Another way to invest in Kenya at low risk is by purchasing treasury bonds issued by the government. These financial instruments earn you a fixed interest rate of 10% per annum over the years. Since they are long term, they can be paid for as long as 25 years.
This is the ultimate investment especially if you do not have the time to run a business yourself.
To invest in treasury bonds, you will need to open a CDS account with the central bank. The CDS account acts as an e-wallet whereby all the buying, paying off interest rate and selling takes place.
Read More- Treasury bonds
3. Treasury Bills
Treasury bills are different from treasury bonds in that they are short term. However, they are still government-issued and they earn an interest rate of 10% per annum.
Moreover, just like trading in treasury bonds, you will need to open a CDS account to facilitate transactions. The more treasury bills you purchase the higher your returns.
4. Trading in shares
Trading in shares is riskier as compared to the other investment opportunities listed above. The stock market is highly volatile. Despite having this characteristic, it also earns one high returns.
You could decide to get an agent to trade in the shares on your behalf or you could decide to trade in them by yourself. Some companies offer an online shares trading platform.
However, it is very important to learn more about how the stock market operates before deciding to invest in this area. This is because, if you invest carelessly in the trade market, you might end up losing everything and starting all over again.
Make sure that you buy shares of companies that you love and like what they do.
When you invest in stocks, your investment pays in two ways. One is through the payment of dividends while two is through stock appreciation in value.
Here is a list of the best online stock trading platforms
- NIC Securities
- Dyer and Blair securities
- SBG securities
Here is a beginner’s guide to online stock trading.
5. Capital Partnerships
Over the years of working in a bank, I have seen people earn pretty money from joint ventures. We all know that we were created with different talents and gifts. Maybe you are not gifted enough in Idea generation but you have funds.
You could look for a venture to invest in. Once you have invested in the venture, you should be able to earn dividends or even share profits.
6. Corporate bonds
A company may be looking to expand but may lack the funds it needs. As a strategy of pooling funds for growth, a company may offer to sell a piece of this company to anyone who offers to give them a certain amount of money.
This is what investing in a corporate bond is all about. If you have a stockbroker, they will give you information about the available corporate bonds for your purchase. Just make sure that whichever corporate bond you are dealing with, they have been listed on the Nairobi Stock Exchange.
7. Agribusiness
People will always need food to eat. Even when the times are hard the demand for food will never go down. Investing in agribusiness in Kenya is, therefore, a very smart choice.
All that you need to keep in mind while investing in this business is that:
- Survey the market to make sure that what you decide to plant is needed in the market
- Invest in greenhouses and a borehole. Depending on seasonal rain may mess you up. If you come from the Eastern region, you know how investing in a borehole is a cash cow.
- Add value to what you produce – Are you producing tamarind – then make tamarind sauce or juice instead of just selling the raw tamarinds.
Conclusion on how to invest in Kenya
I hope the ideas shared above will start you out on how to invest in Kenya in 2020. Choose an idea in which you can easily bore the risk.
Happy Investing!
