Kakande's Investments Podcast Kakande's Investments Podcast

Friends,
I would like to express my heartfelt gratitude to the team at the Bank of Uganda for their exceptional contribution to this discussion and for guiding the conversation as we strive to broaden the understanding of investments, with a particular focus on treasury bonds and treasury bills in Uganda.
To each and everyone of you who tuned in, shared the link in different groups that allowed us to have over 8,000 live audiences, you are my heroes as we push this conversation forward.

For those who were unable to join us live, we have uploaded the two-hour audio recording of the space. I highly recommend listening to it in its entirety. Over the upcoming weeks, I plan to dissect the discussion into more digestible segments and provide written commentary.
This initiative is part of our ongoing effort to teach and continue to highlight the subject of investment and conduct more such informational sessions to raise awareness about these Treasury Bonds
Our aim is to build trust and awareness in this niche investment products and Our Capital Markets.
While we may not have had all the time to respond to every individual question on Twitter/X, rest assured that we will revisit them.
The Bank of Uganda team has committed to publishing a Q&A paper to address many of your queries. On my end, I pledge to continue writing about these especially based on questions raised.

In this particular session, we talked about a variety of subjects, including the what are the difference between treasury bonds and bills, the process of opening a Central Securities Depository (CSD) account, the role of primary banks, the implications of withholding tax on bonds and bills, and the risks and returns associated with these investments.
Packed with valuable information, this is a resource I would strongly suggest to anyone interested in learning about investing in treasury bonds and bills.
Happy Investing Everyone.
Alex Kakande


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com

Alex Kakande, Jean Akol & Allan Nyamutale
In the podcast, Kakande Alex and Jean Akol discuss the concept of the Ugandan dream in a financial and management context.
Alex posits that the Ugandan dream should be contextualized to include owning a decent house, being able to afford one's kids' school fees, and having a comfortable leisure lifestyle that matches one's earnings.
Jean Akol notes that an individual's dreams, lifestyle, and inequality should drive their asset allocation, emphasizing the diversity, particularly within the middle-income bracket. The cost of education, transportation, housing, and entertainment can vary significantly, making it important for each individual to define their goals and budget accordingly.
They calculate and agree that for a middle-income Ugandan family to comfortably afford a decent lifestyle, they should be earning around 5.5 million Ugandan Shillings net income per month. This figure allows for expenses such as rent, school fees, transportation, and even entertainment while leaving room for savings.
However, Jean points out that everyone has unique goals and dreams which should guide their expenditures. Irrespective of the income, it is significant to align one's spending habits with their aspirations and financial constraints.
The podcast concludes on the note that individuals' objectives and goals should drive their financial decisions. Alex and Jean suggest that money is merely an enabler, and people should focus more on achieving their goals rather than accumulating wealth endlessly. They contend that defining one's aspirations and working towards them will ultimately bring about satisfaction, even if it doesn't necessarily translate into boundless wealth.

Alex Kakande


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com

In the podcast, the speakers Alex, Allan, Jean, Yogi and Timothy the host discuss investment options in Uganda, specifically debating between real estate and fixed income securities, such as treasury bonds and unit trusts. The discussion arises out of the question of where an ordinary investor should put their money and what the potential returns would be.
Alex argues for fixed income investments, stating that they are characterized by better yields and less risk. He emphasizes that these investments are suited to both long and short-term financial objectives. Allan, on the other hand, advocates for real estate, arguing that land is a safe investment that is unlikely to suddenly depreciate in value.
Jean and Yogi discuss the idea of a balanced portfolio that includes both real estate and fixed income securities. They express the importance of understanding one's financial goals, risk tolerance, and investment horizon. They debate that a specific investment type's suitability strongly depends on these individual factors, insisting that financial advice should be personalized.
The main example used throughout the podcast is an investor with 10 million Ugandan Shillings. According to Alex, treasury bonds would give them the best chance of growth investment in 10 years, making them a better choice. However, Allan favoring real estate propose purchasing land, dividing it into plots, and selling at a profit as a viable alternative.
Jean introduces the idea that real estate investment requires substantial capital and a long-term investment horizon to realistically make a good return. He suggests that someone with 10 million shillings might be better off investing in Fixed income securities, depending on their long-term goals.
The conversation concludes without consensus, highlighting how complex the decision between real estate and fixed income investments can be as it extremely depends on an individual's financial situation, goals, risk tolerance, investment horizon and even the amount of capital they have to invest. The podcast aims to inform and educate listeners on the pros and cons of different investment options in Uganda rather than providing one-size-fits-all advice.

Alex Kakande


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com

By Jean Akol and Allan Nyamutale
In the podcast episode, we have Jean Akol and Allan Nyamutale as they discuss real estate as an asset class, the risks, return characteristics, and its integration into an individual's investment portfolio.
They reveal that there are over 36 sub-asset classes in real estate for potential investment, each potentially affected by different economic dynamics. They provide an example of how the location and tenant demographics of rental properties can change its categorization as a sub-asset class.
The go in detail and note that real estate differs from other investment assets because of its heterogeneity.
Each property is unique in terms of location, features, and other factors that could influence its value. They also discuss the capital-intensive and long-term nature of real estate investments. This might limit some potential investors due to the significant funds and patience required.
Given its complex nature, the two gentlemen hinted on the need to understand the subclasses and financial perspective in order not to wrongly place a value on a property.
They warned against treating all properties in a complex similarly and emphasized the defining factors like position and accessibility in determining a property's value. The main take-home message of the podcast is the understanding of real estate from an investment perspective, highlighting its diverse nature, associated risks, and potential return on investments.

Alex Kakande


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com

In today’s conversation, we look at the recent but worrying trend that is starving the private sector of critical credit as commercial banks are increasingly preferring to lend to Government of Uganda through buying of Local and lucrative Treasury Bonds.

From the 2022 Bank of Uganda statistics, The Government securities grew by 141% from 2017 to 2022 yet total loans grew by just 53% in the same period even when Deposits (The biggest source of Banks’ funding) grew by 73% in the similar period, majority of it was channeled to Government Securities.
Below are the graphical representation of the Bank’s Risk averseness in the last 6 years under review.


Deposits Growth vs Loans to customers growth.


Statistics from Bank of Uganda


Happy Investing everyone.
Alex Kakande


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com

In this Episode we break down the importance of planning your loan cashflows and the advantages of Early repayment of whole or part of the loan.
“loan repayment schedule. Every lender will provide a detailed document outlining exactly when payments are due, usually on a monthly basis. In the document, three components will dictate your loan management strategy which are very important to understand: the principal loan amount outstanding at any point in time, the interest charged at each interval, and whether these interest charges are determined by a reducing balance method or a fixed rate.”
The Loan Repayment Schedule before any Early repayment.

Loan Repayment Schedule after an early repayment.


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit kakandealex.substack.com