Ceylon Dollar Bond Fund’s annual return increases to 9% in dollars
View(s):The Ceylon Dollar Bond Fund (CDBF) that invests in Sri Lanka Dollar Sovereign Bonds and Bank Bonds has recorded a 9 per cent p.a. annualised return in US dollar terms up to May 17, 2016. Ceylon Asset Management’s Economic Advisor and Director, Rainer Michael Preiss in Singapore said in a media release, “The CDBF has been able to enjoy capital gains on SL Dollar Bonds from the reducing interest rates following news of the IMF facility extended to Sri Lanka. As I forecasted in April, the high dollar interest rates on Sri Lanka will gradually decline as the economy gains momentum and gains the confidence of international investors. The (US) Fed is unlikely to raise interest rates again in the near future. Therefore, investors can still take advantage of the current interest rate scenario and a strong US dollar”.
The tax exempted Unit Trust is operated out of Colombo and Singapore. The fund is open to investment exclusively for Sri Lankans living or working overseas, BOI companies and all foreign nationals and companies as well as institutional investors who can invest via Singapore or Colombo. The open-ended fund structure enables investors an easy exit whenever they please, without being locked-in for a fixed deposit. The fund has invested in dollar denominated Sovereign Bonds issued by the Government of Sri Lanka, and Dollar Bonds issued by the Bank of Ceylon, National Savings Bank and DFCC Bank, the media release said. The only dollar denominated fund in Sri Lanka is managed by Ceylon Asset Management while Deutsche Bank is Trustee and Custodian of the fund.