By Benjamin Nathan OTCHERE
With Ghana’s financial markets becoming more stable and Treasury bill rates moving along a downward path, cautious investors must make an important choice: stay with minimal profits or explore smart alternatives that offer security alongside income and opportunities for growth.
Treasury bills currently offer yields ranging from 10% to 13% (as of mid-August 2025), while government bonds provide returns between 15% and 17%. This presents an appropriate moment to review your financial goals and approach. A possible choice is a properly organized collective investment vehicle (CIV), specifically a diversified fund, which may deliver solid gains while efficiently handling risks for investors worried about the sharp decline in GOG bills recently.
The balanced fund advantage
A Professional Investment Fund (PIF), specifically balanced funds, refers to an investment structure overseen by experts that gathers funds from several investors to build varied financial portfolios. In contrast to the limited emphasis seen in Treasury notes or state-issued bonds, balanced funds distribute assets thoughtfully among different categories such as stocks, debt instruments, short-term market tools, and non-traditional investments.
The core attraction of balanced funds stems from their two-fold objective: safeguarding assets via cautious investment choices along with opportunities for appreciation through calculated stock market involvement. This strategy effectively tackles the main worry of cautious investors aiming for gains exceeding inflation without taking excessive risks.
The Importance of Strategic Diversification and Its Advantages
Although Treasury bills provide stable income, they carry substantial risks from inflation and increase the danger of having too much invested in one area. Given that Ghana’s inflation rate stood at 12.1% as of July 2025, those depending only on Treasury bills—offering yields between 10% and 13%—experience minimal actual gains that struggle to match the decline in buying capacity. This situation mainly impacts retirees, middle-income earners, and students whose savings must continue to expand and preserve value over time.
Balanced funds address this issue via smart diversification. They mix government bonds for security with thoughtfully chosen stocks for appreciation, offering gains that outpace inflation while experiencing less fluctuation compared to purely stock-based portfolios. The presence of skilled oversight means portfolio rebalancing happens according to economic trends, relieving individuals of the responsibility of making ongoing investment choices.
Current market performance:
A compelling case study
Current financial trends highlight the substantial opportunity loss associated with holding only low-return government bonds. Firstly, the S&P 500 has generated a 9.3% (in US dollars) gain from January 1, 2025 onward, reflecting the ongoing resilience of international stock markets even amid multiple economic challenges. This offers greater advantages for individuals looking to include US dollar-based investments in their private investment mix.
More pertinent for investors based in Ghana, the GSE Composite Index rose 216.20 points to reach 6,992.29, reflecting approximately a 43.03% return so far this year as of July 2025. Such outstanding growth underscores the significant returns achievable for those who have proper stock market involvement via well-managed investment funds.
Furthermore, non-traditional investments have demonstrated strong endurance. Gold has increased by more than 24% (in U.S. dollars) this year, with certain gold exchange-traded funds such as SPDR Gold Shares achieving a 26.97% (in U.S. dollar terms) total return so far this year, offering advantages in portfolio diversification that standard government bonds do not provide.
When gold performs strongly in U.S. dollar terms, the gold ETF listed on the GSE has performed poorly, recording a decrease of approximately -2.9% as of August 22, 2025, due to the robustness of the Ghanaian cedi. Nevertheless, it may surprise you that this particular ETF has delivered more than 1000% returns since its launch. Therefore, this presents an opportunity where prudent fund managers are purchasing assets in preparation for future growth over the next few years.
YTD Comparative Performance Review (2025)
|
Asset Class |
YTD Returns(%) |
Risk Profile |
| Ghana Treasury Bills | 10-13% | Very Low |
| Government of Ghana Bonds | 15-17% | Low |
| Bank Securities | 15-16% | Low |
| GSE Composite Index | 43.03% | High |
| S&P 500 Index | 9.30% | Moderate-High |
| New Gold ETF (GLD) | -2.94% | High |
| Typical Balanced Fund Range | 18-25% | Moderate |
This comparison highlights how balanced funds, through their varied strategy, may achieve returns much higher than those of government bonds while carrying relatively lower risks compared to direct stock market investments.
Why diversified funds appeal to risk-averse investors
For career-oriented individuals aiming to accumulate savings for their later years, balanced funds provide consistent access to investment opportunities that drive growth, without needing deep understanding of financial markets. The managed aspect guarantees regular adjustments to the portfolio, keeping desired asset distributions intact amid changing economic circumstances.
Retirees gain advantages from the ability of balanced funds to generate income via dividends and interest, while still having access to assets that help maintain buying strength over time. These consistent income payouts can enhance pension benefits, offering greater monetary freedom throughout retirement.
Young students and professionals benefit specifically from balanced funds due to their focus on sustained growth over time. By keeping risk levels low suitable for modest savings, these funds offer access to asset classes that can grow significantly over many years of investing.
The advantage: The distinction in professional administration
In contrast to choosing stocks or bonds individually, balanced funds benefit from experienced portfolio management groups that have specific knowledge of financial markets, strong research resources, and access to investment options typically available only to large institutions. These professionals constantly track economic data, evaluate asset prices, and modify their holdings to achieve the best possible return for the level of risk involved.
This regulatory supervision demonstrates significant usefulness during shifts in the market, like Ghana’s present sharp adjustment phase. Portfolio managers can strategically modify their distributions between governmental bonds and investment-oriented assets according to changing interest rate structures, anticipated inflation levels, and stock market pricing.
Key factors in managing diversified investment portfolios
Investors with a conservative approach who are looking at balanced funds must consider various essential elements. The fee structure of the fund affects overall returns, highlighting the importance of choosing cost-effective options for sustained growth over time. Although past performance does not ensure future success, it offers valuable information about the expertise of the managing team and the fund’s reliability.
Another important factor is the asset allocation method used. Certain balanced funds have fixed distributions, whereas others use flexible tactics that change according to economic circumstances. Grasping these techniques aids in choosing funds that match individual comfort with risk and desired returns.
Final Thoughts: Strategic Placement for Sustained Achievement
The changing conditions affecting Ghana’s agricultural output present both difficulties and possibilities for risk-averse investors. Although government bonds still provide steady income, their low return compared to rising prices raises worries about maintaining value over time.
Balanced funds offer an attractive option that tackles these issues via expert diversification, calculated asset distribution, and strategies focused on growth. The present financial landscape, marked by robust stock gains and varied investing choices, creates a favorable setting for cautious investors aiming to boost their returns without exceeding acceptable levels of risk.
This content is intended for learning and informational use only and must not be considered as guidance regarding finance, taxes, or investments. Review the CIS brochure and consult with a qualified financial advisor prior to making an investment decision.
Benjamin is a | Certified Financial Consultant & Planner
Offered by SyndiGate Media Inc. (
Syndigate.info
).
