Unit Trust Funds Performance Report – 2025

In 2025, Kenya’s collective investment schemes exhibited varied performance across different asset classes. Money Market Funds (MMFs) delivered lower yields than in 2024, primarily as a result of declining Treasury bill rates and ongoing monetary easing. In contrast, Fixed Income Funds posted strong returns, capitalizing on capital gains driven by rising bond prices amid a falling interest rate environment. Balanced Funds produced mixed results, benefiting from gains in the bond market while maintaining a moderated exposure to equities. Overall, a macroeconomic environment featuring lower inflation, reduced policy rates, enhanced liquidity, and currency stability was instrumental in shaping investment outcomes across asset classes.

Money Market Funds (MMFs) Performance – 2025

Money Market Funds in Kenya saw lower returns, mainly due to a notable drop in short-term interest rates, especially Treasury bills, which form the core of MMF investments.

Main Performance Drivers:

• Falling Treasury Bill Rates: The 91-day Treasury Bill rate fell from over 15%  from 2024 to around 9% by early 2025, directly impacting MMF yields.
• Monetary Easing: The Central Bank of Kenya kept reducing the CBR rate throughout the year further lowering money market returns.
• Lower Inflation: Stabilizing and declining inflation lessened the need for higher interest rates.
• Increased Liquidity: Improved liquidity in the banking sector supported a low-rate environment, keeping yields contained.

Even with these challenges, MMFs remained competitive. The Cytonn Money Market Fund led the pack, followed by Gulfcap and Etica.

These returns remained competitive relative to traditional bank deposits, especially considering MMFs’ liquidity and flexibility advantages. 

Dollar Money Market Funds

Dollar Money Market Funds in 2025 saw returns moderate as the Federal Reserve cut rates and inflation persisted. Investors shifted toward government funds amid policy uncertainty and concerns over economic weakening. 

Despite lower yields, dollar MMFs remained popular, with Kuza Money Market Fund USD leading performance, followed by Etica and Nabo Africa funds.

Fixed Income Funds Performance – 2025

Fixed income funds pool investments in government and corporate bonds, offering steady income and capital preservation—ideal for conservative investors.

Performance Highlights:

• Assets under management grew by 29.5% in Q3 2025 as investors shifted from money market funds to higher-yielding bond funds.
• Falling interest rates and a lower yield curve boosted bond prices and capital gains.
• Stable Kenyan Shilling and Eurobond buybacks enhanced investor confidence and returns.
• U.S. Fed rate cuts and improved global risk appetite further supported local fixed income markets.

Top Performers: Lofty-Corban Bond Fund (20.76% gross, 17.65% net), Mayfair Fixed Income Fund (16.04% gross, 13.63% net), and Etica Money Market Fund (12.92% gross, 10.98% net) all outperformed traditional MMFs.