Index Funds emerge top performer

Ceylon Financial Sector Fund (CFSF) emerged the best performing Unit Trust in Sri Lanka, growing 10.47% during the first quarter of 2013 outperforming the Bank, Finance and Insurance (BFI) sector growth of 8.36% the All Share Price Index (ASPI) growth of 1.64% and all funds, including ‘Growth funds’ in the country. The CFSF fund has grown 21.85% year to date in 2013.

Meanwhile, the Ceylon Index Fund (CIF) emerged the best performing equity based fund in 2012 outperforming the ASPI return by 15.86%. The CIF has grown 21.83% year to date in 2013.

“We offer low risk and low cost, liquid products without the risk of speculation,” Ceylon Asset Management (CAM) Managing Director Dulindra Fernando said. The companies included in the Colombo Top 10 Index and the Financial Sector Top 10 Index, are selected on the basis of size and liquidity each quarter by an independent index committee. The funds are subject to the single company exposure limits of the SEC code.  

CIF, a country fund with a track record since 1999, tracks the performance of Colombo Top 10 Index, covering 29% of the Colombo Stock Exchange (CSE) total market capitalisation. The companies currently included in the Colombo Top 10 Index are; John Keells Holdings PLC, Commercial Bank of Ceylon PLC, Dialog PLC, Hatton National Bank PLC,  Distilleries Co., of Sri Lanka PLC, Aitken Spence PLC, Cargills (Ceylon) PLC, Lion Breweries Ceylon PLC, Chevron Lubricants Lanka PLC and Aitken Spence Hotel Holdings PLC.

CFSF tracks returns of the Top 10 BFI index companies listed on the CSE covering 64% of the total BFI sector market capitalisation on the CSE. The financial sector Top 10 Index companies are; Commercial Bank of Ceylon PLC, Hatton National Bank PLC, Sampath Bank PLC, DFCC PLC, National Development Bank PLC, Lanka Orix Leasing Company  PLC (LOLC), Peoples Leasing PLC, Central Finance Company PLC, Nations Trust Bank PLC and Seylan Bank PLC.

Both funds are managed by Ceylon Asset Management Co., while Deutsche Bank AG is the Trustee and Custodian of the funds. Ceylon Asset Management has a 14-year track record in index fund management to offer stock market returns without speculative and trading risks.

CAM also manages another sector based index fund, Ceylon Tourism Fund, and two fixed income funds ‘Ceylon Income Fund’, rated A-(lka) and ‘Ceylon Gilt-Edged Fund’ rated AAA by Fitch Ratings. All Funds are licensed by the Securities and Exchange Commission of Sri Lanka and audited by PricewaterhouseCoopers.