Investor interest in Nigeria’s dollar-denominated mutual funds surged in the first half of 2025, with the Net Asset Value (NAV) rising by 12.4% to ₦1.92 trillion as of June, according to newly released data from the Securities and Exchange Commission (SEC). This growth highlights the continued demand for safe, foreign currency-linked investment vehicles amid local currency depreciation and global monetary easing.
Dollar mutual funds are pooled investment schemes that primarily invest in Eurobonds and other dollar-denominated fixed income instruments. These funds have become increasingly attractive to both retail and institutional investors, offering a strong hedge against naira depreciation while delivering relatively stable returns in hard currency.
By the end of June 2025, Nigeria’s 34 SEC-registered dollar mutual funds delivered an average year-to-date (YTD) return of 6.73%, a slight dip from the 7.63% average recorded at the close of 2024. This decline is largely linked to softening global fixed income yields, spurred by interest rate cuts from major central banks, including the U.S. Federal Reserve.
Global Market Conditions Impacting Returns
The downward trend in returns is consistent with broader global market movements. Data from the Debt Management Office (DMO) reveals that average Eurobond yields declined from 9.525% in January to 8.534% by the end of June. Since Eurobonds represent a significant portion of the funds’ underlying assets, this drop contributed to the lower yield performance of dollar mutual funds.
Nonetheless, the core appeal of these funds remains intact. They continue to serve as a buffer against exchange rate volatility and inflationary risks. In response to the global yield compression, fund managers are adopting more dynamic strategies—selectively investing in high-quality sovereign and corporate Eurobonds to enhance performance while managing risk.
Top Performing Dollar Mutual Funds (as of July 27, 2025)
Here are the top 10 highest-yielding dollar mutual funds in Nigeria for H1 2025:
10. FSL Eurobond Fund – 8.70%
- Fund Manager: FSL Asset Management Ltd
- NAV: ₦1 billion
- Unit Holders: 8 subscribers
9. United Capital Global Fixed Income Fund – 9.19%
- Fund Manager: FSL Asset Management Ltd
- NAV: ₦183.64 billion
- Unit Holders: 735 subscribers
8. Lead Dollar Fixed Income Fund – 9.23%
- Fund Manager: Lead Asset Management Ltd
- NAV: ₦1.57 billion
- Unit Holders: 53 subscribers
7. Norrenberger Dollar Fund – 9.56%
- Fund Manager: Norrenberger Asset Management Ltd
- NAV: ₦31.12 billion
- Unit Holders: 673 subscribers
6. Meristem Dollar Fund – 9.67%
- Fund Manager: Meristem Wealth Management Ltd
- NAV: ₦5.31 billion
- Unit Holders: 134 subscribers
5. United Capital Nigerian Eurobond Fund – 9.70%
- Fund Manager: United Capital Asset Management Ltd
- NAV: ₦177.53 billion
- Unit Holders: 3,772 subscribers
4. Cowry Eurobond Fund – 11.67%
- Fund Manager: Cowry Treasurers Ltd
- NAV: ₦453.8 million
- Unit Holders: 46 subscribers
3. AVA GAM Fixed Income Dollar Fund – 12.59%
- Fund Manager: AVA Global Asset Managers Ltd
- NAV: ₦1.88 billion
- Unit Holders: 23 subscribers
2. Futureview Dollar Fund – 13.02%
- Fund Manager: Futureview Asset Management Ltd
- NAV: ₦251.8 million
- Unit Holders: 9 subscribers
1. Comercio Partners Dollar Fund – 13.70%
- Fund Manager: Comercio Partners Asset Management Ltd
- NAV: ₦800.57 million
- Unit Holders: 31 subscribers
Outlook: Resilience Amid Shifting Market Conditions
Despite a mild decline in average yields, dollar mutual funds have cemented their role as a strategic asset class for Nigerian investors aiming to protect and grow wealth in uncertain times. Their ability to mitigate currency depreciation, offer dollar exposure, and provide consistent income makes them particularly valuable in a high-inflation, low-growth environment.
Looking ahead, these funds are expected to remain central to diversified portfolios—both for cautious individual investors and for institutions managing long-term assets—especially as Nigeria continues to grapple with foreign exchange instability and broader macroeconomic challenges.
