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The Old Mutual Guaranteed Fund is the largest investment fund in Malawi offered to retirement funds. The product aims to provide inflation-beating returns over the medium to long-term. The returns are allocated to Guaranteed fund Policyholders.
How does it work?
The Guaranteed Fund offers policyholders full guarantees on contributions and partial guarantees on allocated returns. Contributions by policyholders are fully guaranteed during resignation, retirement, death, disability, and retrenchment payments, which means contributions will be received in full even when there is a significant fall of financial markets.
The net contributions made by policyholders earn returns which are split between guaranteed (vested) and non-guaranteed (non-vested) returns. Guaranteed returns are not impacted negatively by any future financial market underperformance. Extreme financial market conditions may impact the non-guaranteed part of the return. The non-guaranteed returns are transferred to guaranteed returns over time.
What is smoothing and what are its benefits?
Smoothing is the process used to pass investment returns earned on investment portfolios, which are exposed to market fluctuations, on to Policyholders in a way that is more predictable and stable. The returns are determined by the performance of the underlying investments of the portfolio, which is managed by Old Mutual.
The objective of smoothing is to protect investors against market volatility in the short term while ensuring that the returns declared produce a broadly similar return to that of the portfolio’s underlying investments over the long term.
A Policyholder who is saving for retirement may be faced with the risk that markets might be down precisely at the time they need their money. This is known as investment timing risk. In a smoothed returns fund, Policyholders share this investment timing risk; as a result, much of the investment timing risk is removed so that all Policyholders are not affected by market falls at the time of exit.
Why Choose the Old Mutual Guaranteed Fund?
Security
Your contributions and returns are protected.
Stability
Smoothed bonuses cushion market shocks.
Growth
Long-term performance beating inflation.
Want to know more about Guaranteed Fund?
For more information on the Guaranteed Fund and other products available, please use the Call Me Back button at the top of the page or call +265 891 002 010 or visit your nearest Old Mutual Branch.
The Fund offers security through guaranteed contributions, stability with smoothed bonuses, growth that beats inflation over time, and peace of mind during life’s key moments.
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