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The Managing Director of Stanbic IBTC Asset Management, Bunmi Dayo-Olagunju, has urged investors to diversify their portfolios by investing in mutual funds.

Mutual funds are professionally-managed investment vehicles that are funded by various shareholders for the purpose of being invested in diversified securities such as stocks, bonds, money market instruments, and other similar assets.

In a statement released on Tuesday, Dayo-Olagunju said mutual funds help investors hedge against volatilities in the equities and commodities markets.

“Mutual funds offer an opportunity for steady growth in assets while reducing the attendant risk associated with investing in individual securities,” said Dayo-Olagunju.

Nigerian mutual funds had over N450 billion in assets under management as at June 2014. According to the Securities and Exchange Commission, there were 38 mutual funds in Nigeria as at June 2014 and only six fund managers accounted for 75 percent of assets under management in Nigeria.

Prominent mutual funds under management by Stanbic IBTC Asset Management include the Stanbic IBTC Nigerian Equity Fund, Nigeria’s largest equity mutual fund; the Stanbic IBTC Ethical Fund, Nigeria’s first and largest socially responsible mutual fund; Stanbic IBTC Money Market Fund, which offers investors better bargaining power in the money market; and the Stanbic IBTC Imaan Fund, a mutual fund tailored to the needs of those seeking investments compliant with their religious principles and beliefs.

Stanbic IBTC Asset Management Limited is a wholly-owned subsidiary of Stanbic IBTC Holdings Plc, which is part of the Standard Bank Group, Africa’s largest bank by assets and market capitalization. Standard Bank Group, which was founded in 1862, has operations in 20 African countries.