Background to the Unit Trust Industry
The Unit Trusts commenced operations in Sri Lanka during the year 1991 and in the following year, three more management companies were licensed to operate, and each of them launched Balanced Funds, to provide income and growth by investing in equity and fixed income securities. As a result, during the lean years of the Stock Market from 1994 to 2001, the performance of Unit Trusts suffered along with the decline in the overall share market. During the period 1996-1997, six new funds were formed to offer diversity of investment schemes. This enabled formation of growth funds and investment into Government securities and the debt market thereby introducing Gilt Edged Funds and Income Funds.
Currently, the Securities and Exchange Commission of Sri Lanka has licensed five management companies to operate thirteen open ended Funds. They comprise of four Balanced Funds, three Growth Funds, three Income Funds, one Gilt Edged Fund, one Money Market Fund and one Index Fund. Fund Investors comprise both Institutional and retail investors. However, the Institutional investors hold a majority of the units issued whilst among the unitholders majority of them are individual unit holders.
The Unit Trust Association of Srilanka (UTA) is an apex body of licensed unit trust management companies in Srilanka. The UTA was formed in 1992 to facilitate and promote investor awareness and express unit trust industry perspectives in related matters. It also functions as self governing body and contributes development of good practices and represents on any grievances of the industry to create an equitable platform for all member companies.
Related websites
Unit Trust Association of Sri Lanka : www.unittrust.lk
http://www.sec.gov.lk/UT_Companies.html
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