An individual investor’s profile is determined by the following:

Financial goal and Time Horizon

An investor’s financial goals and time horizon have a bearing on their risk tolerance level. Generally, critical goals and/or short time horizons (e.g. less than five years) may dictate a more conservative approach. On the other hand, a less critical goal and/or longer time horizons may accommodate a more aggressive approach since they have sufficient time to recover from short term drops in the asset values.

Financial Situation

A larger income and asset base may allow you the flexibility to take more risk because you have a greater ability to recover from underperforming investments. However, some investors with large assets may prefer to take a more conservative approach since they do not feel a need to take on extra risk to meet their goals.

Personality

Some people’s personalities often predispose them towards more or less risk-taking than others.

Experience With Investing

Some people have experience investing and therefore have an appreciation of the risk-return characteristics of different asset classes. More experienced investors often have the ability to take on risk since they have a clear understanding whereas inexperienced investors may be better off holding relatively conservative portfolios given their limited understanding of investments.

Understanding the risk profile of clients is central to XENO investment philosophy. XENO profiles you to understand your circumstances and determine your risk tolerance before recommending a customized investment portfolio to meet your objectives.  

Yes! Of course. Once you visit the platform, you will at first identify one goal (e.g. Build Wealth) to set up your investment account. You can then log into your investment account and add another investment goal (e.g. Fund Emergencies or Fund Education). However, each goal has to have a minimum of UGX 10,000.

Uganda:

A unit trust fund is made up of units (think of these as shares) which have a unit (or share) price that fluctuates every day. For example, if you invest UGX 1,000,000 in a unit trust fund whose current unit price is UGX 100, you will be issued 10,000 units (=1,000,000 divided by 100) in return.

Your UGX 1,000,000 investment is then pooled together with funds from other investors and collectively invested by the fund manager. The value (including gains or losses) of the underlying assets is calculated every day and the price of each unit of the fund is updated to reflect the gains or losses.

The price of each unit moves based on the value of the underlying assets driven by interest accruals and/or capital appreciation/depreciation. Continuing with our example above, if the price of each unit increases to UGX 101 the next day, then your investment will be UGX 1,010,000. On the other hand, if the unit price falls to UGX 99 the next, then the value of your investment will fall to UGX 990,000.

Kenya

A unit trust fund is made up of units (think of these as shares) which have a unit (or share) price that fluctuates every day. For example, if you invest KES 10,000 in a unit trust fund whose current unit price is KES 100, you will be issued 100 units (=10,000 divided by 100) in return.

Your KES10,000 investment is then pooled together with funds from other investors and collectively invested by the fund manager. The value (including gains or losses) of the underlying assets is calculated every day and the price of each unit of the fund is updated to reflect the gains or losses.

The price of each unit moves based on the value of the underlying assets driven by interest accruals and/or capital appreciation/depreciation. Continuing with our example above, if the price of each unit increases to KES 101 the next day, then your investment will be KES 10,100. On the other hand, if the unit price falls to KES 99 the next, then the value of your investment will fall to KES 9,900.

XENO unit trust funds have the following stakeholders that provide them with professional services:

• Regulator (Capital Markets Authority - writes the regulations within which to operate and enforces compliance)
• Trustee (KCB bank – provides independent oversight over the affairs of the unit trust fund on behalf of the unitholders)
• Fund manager (XENO – responsible for investment research, analysis, and execution)
• Custodian (Stanbic bank – holds the assets of investors in safe custody)

• Professional managers – a fund gives you access to professional service providers including investment managers, custodians, auditors at no extra fee.
• Diversification – a unit trust fund gives you the ability to own several assets at once without extra effort or cost. For example, a bond fund can hold several bonds (e.g., 5-year, 10-year, 15-year bonds, etc).
• Low costs – operational expenses are shared with other investors which means every individual bears a much smaller cost than if they would have bought the assets individually.
• Liquid – you can easily liquidate some or all your holdings into cash without significant loss in value with just days. This is not possible for asset classes such as real estate or even fixed deposits at banks.
• Tax-efficient – income generated by unit trust funds is currently exempted from taxes at the fund level. If you want to own treasury bills or bonds, it is much more tax efficient to invest in a unit trust fund that invests in treasury bills or bonds than to invest in the individual bills or bonds directly.
• Low minimums – for as little as UGX 10,000, you can gain exposure to a diversified portfolio of assets including money markets, bonds, and equities.

A unit trust is a fund composed of investors' money, which is invested in financial assets according to a particular strategy. When you invest in a unit trust, your money is pooled with that of other investors to form a fund. The money in the fund is invested in various assets to meet the unit trust's objectives which are set by the fund manager.

XENO runs four unit trust funds that broadly cover the four diverse asset classes in its investment universe, namely:

1. XENO Uganda Money Market Fund (invests in treasury bills, fixed deposits, call deposits, etc.)

2. XENO Uganda Bond Fund (invests in bonds issued by governments and companies in East Africa)

3. XENO Uganda Domestic Equity Fund (invests in shares of Ugandan companies listed on Uganda Securities Exchange)

4. XENO Uganda Regional Equity Fund (invests in shares of other listed East African companies)

A withdrawal means we exit some of your investments and liquidate them into cash and then transfer that cash to your bank account. This process is usually completed within three (3) business days. For example, if you initiate a withdraw request at 3 PM on Friday, it will be processed by Wednesday the next week.

Fortunately, no. Your investments are executed using unit trust funds which have the attractive characteristic of being "liquid". That is to say, you can liquidate part or all of your investments by initiating a withdraw request within the XENO platform additional transaction fees or penalties.

However, to honour your withdrawal request, we actually have to sell your investments in the XENO Unit Trust Funds at the bid-price of each fund which may be less than the mid-price of the fund. Regardless, we encourage our clients to have a long-term view for their long-term goals.

Creating an investment account is free and does not oblige you to invest. There are no charges until you transfer money into your XENO investment account for the purpose of investing. You can close your investment account and withdraw your money whenever you want. After closing your account, we will hold your personal information for a limited time as required by law. However, investment is an act of taking risk and it is possible that in some cases you may not get back the entire sum you invested.

Alternatively, if you are going through a rough patch, you can always ask us to temporarily suspend your account until you get back in your feet. You can always ask us to re-activate your account.

If you sign up using web, we ask will be asked for:

1. Biographical details (e.g., Names, Date of birth, nationality)
2. A government-issued ID (e.g., National ID, Passport, or Driving Permit).
3. Passport-size photo (full-faced selfie will do)
4. Physical address (e.g., Road/Street, County, District, Region)
5. Phone number
6. Email
7. Bank details (relevant when you withdraw some or all your investment)

If you sign up via USSD:

1. On MTN, dial *165*4*4#
2. Enter Merchant Code: XENO
3. Follow the rest of the steps
4. No extra information is required once you activate your account via USSD

Fees will be computed and accrued per day. For example, if fees are 2% per annum, each day we will collect 2% divided by 365 (i.e. daily fraction of the annual fees). It is important to keep in mind that just as fees are collected per day, the interest on underlying instruments are also accrued and distributed to the client accounts per day. For example, if interest on the underlying instruments is 14.7% per annum, each day we will accrue and distribute the 14.7% divided by 365 (i.e. the daily fraction of the annual interest). Remember, fees are usually much smaller than the returns on the underlying instruments.

We will charge an annual management fee of less than 2% of assets under management. To illustrate, if you start with UGX 10,000 at the beginning of the year and this investment earns 20% (or UGX 2,000) return that year so that your ending balance is UGX 12,000. We will compute the average balance in the account that year to be 11,000 (= (10,000+12,000)/2). The total management fee will be UGX 220 for that year (i.e. 2% of UGX 11,000). This comes to roughly UGX 18.33 per month. Fees are exclusive of VAT.

XENO does not handle your money at all. Like many investment managers, we believe that the safest way of looking after your investments is to appoint an independent custodian bank licensed by the Bank of Uganda. The custodian bank holds your money and maintains an accurate record of your deposits and the investments we purchase for you. Our appointed custodian is Stanbic Bank, one of the leading providers of custody services on the African continent. Stanbic Bank keeps all your investments in a segregated account for added security and will never mix them with Stanbic Bank’s or XENO’s own assets.

Your investments and any un-invested cash are therefore protected in the unlikely event that either XENO or Stanbic Bank decides to exit the market for any reason. If this were to happen, your segregated account would be re-assigned to another financial institution by the regulator (the Capital Markets Authority) and you would be kept informed.

XENO takes the security of client information seriously. We follow data protection best practices and we do not share your information with anyone. Your personal details and your account data are always encrypted and stored on secure servers. For more information, read our Privacy Policy.