The Sri Lanka fund is an open ended Fund denominated in US Dollars which primarily invests in equities and other equity linked securities with exposure to the Sri Lankan market. It is an exempt Company with limited liability incorporated in the Cayman Islands. The Fund is designed to enable non-Sri Lankan institutional and individual investors to invest in Sri Lanka. It is also open to non resident Sri Lankans.It is registered with the Singapore Monitory Authority as a restricted foreign scheme.

 

The Sri Lanka Fund’s investment objective is to achieve capital growth by investing in a diversified portfolio consisting primarily of high growth equities and equity linked securities, including convertible bonds and warrants, listed on the Colombo Stock Exchange (CSE). It can also invest in equity securities issued by listed companies and funds (wherever established) which invest primarily inequity issued by Sri Lankan companies listed on the CSE.

 

Fund Information

 

Name of the fund – The Sri Lanka Fund
Fund Structure – Open Ended Fund
Legal Entity – Limited Liability Company
Domicile – Cayman Island and registered as a restricted foreign scheme with the Monetory Authority of Singapore
Date of Inception – 21st October 1993, change of name – 23rd October 2000
Regulated by – The Cayman Island Monetary Authority
Listing – The Fund is at present not listed

 

Currency :	US Dollars
Management fee :	1.5 % of Net Asset Value per annum
Hurdle rate / High water mark :	Percentage change of the All Share Price Index
Subscription fee :	US$ 50,000 – 100,000 = 1.5% Over 100,000 Negotiable
Redemption fee :	Maximum of 0.5% of the redeemed value and
Any other fee :	Custodial Fees – 0.15% of Net Asset Value subject to a minimum of USD 6000 Administration Fees – USD 10,000
Ordinary expenses	Auditors fee, legal fees etc..

 

Investment process

 

Minimum initial investment:	US$50,000
Minimum subsequent investment:	US$10,000
Subscription frequency (when):	Every Tuesday in Sri Lanka shall be determined as a Valuation Day. The Valuation Day of each month is a Dealing Day. Subscriptions and redemption of Shares are carried out on Dealing Days.
Redemption frequency (when):	Every Tuesday in Sri Lanka shall be determined as a Valuation Day. The Valuation Day of each month is a Dealing Day. Subscriptions and redemption of Shares are carried out on Dealing Days.
Redemption notice period:	5 clear business days prior to next dealing day.
Redemption cash proceeds time period:	Payment of redemption proceeds in US Dollars will be made normally within 14 days following the relevant Dealing Day
Lock-up period	None
Is there any liquidity constraints?	The Manager, on the Directors’ behalf, may limit redemptions to 10 per cent. of the total outstanding Participating Shares in any Dealing Period.

 

Who can invest?

	Foreign mutual funds
	Foreign institutional investors
	Corporates not resident in Sri Lanka
	Foreign individuals not resident in Sri Lanka
	Sri Lankans not resident in Sri Lanka

 

Benefits

	Dollar denominated Subscribe and redeem the investment in dollars but carry the exchange rate risk on the local underlying portfolio.
	Tax free As the fund is registered in Cayman Islands, which is a tax haven, the capital gains nor the dividend income will be taxed.
	Liquidity Can encash with the manager at any time since this is an open ended fund.
	No start-up cost The fund is already established hence the start-up cost has already been recovered.
	Promoter shares risk Since the fund has been seeded by the promoters they carry a risk similar to all clients.

 

Parties Involved

 

Managed by

Guardian Fund Management Limited a registered investment manager with Securities Exchange Commission of Sri Lanka

 

Custodian & Registrar

Deutsche Bank, Colombo

 

Auditors

KPMG, Cayman Islands

 

Administrators

Carsons Management Services (Private Limited)

 

Lawyers

Maples & Calder, Cayman Islands