5 Best Investments with High Returns in Kenya

Kenya’s investment landscape in 2025 offers compelling opportunities for investors seeking high returns, with various options delivering returns that significantly outpace traditional savings accounts and even government securities. In this article we well go through 5 Best Investments with High Returns in Kenya From special funds returning over 20% annually to dividend-paying stocks offering yields above 15%, for Kenyan investors to have access to diverse investment vehicles that can help build substantial wealth over time.

List Of Top 5 Best Investments with High Returns in Kenya

1. Special Funds – The Highest Return Investment Option

What They Are:

Special Funds, officially known as “Special CIS / Special Funds” in Kenya, represent regulated collective investment schemes that can invest across multiple asset classes both locally and internationally. These funds offer more flexibility than standard funds but typically come with higher minimums, lock-in periods, and performance fees.

Top Special Funds with Latest Returns & Features

Oak Special Fund (KES version)

• Latest Performance: Q2 2025 delivered 4.88% absolute return (approximately 19.52% annualized). For the full year 2024, the fund delivered approximately 29.38% net return
• Key Features: Minimum investment KES 500,000, top-up KES 50,000; 6-month lock-in period
• Target Return: Net 20% per annum
• Investment Strategy: Diversified across global forex trading, precious metals, commodities, global stocks & ETFs, government securities, NSE equities, and commercial papers

Mansa-X Special Fund (SIB, KES and USD)

• Latest Performance: Q2 2025 delivered 6.05% net returns for the KES version, bringing H1 2025 performance to 10.94% (annualized to approximately 21.88%). The fund has consistently delivered an average net return of 17.72% per annum since inception
• Key Features: Minimum KES 250,000, top-up KES 100,000; 6-month lock-in; performance charges above hurdle rates
• USD Version: Q2 2025 returned 3.47% for the USD fund, with half-yearly return of 6.61% (annualized to 13.22%)

Arvocap Multi-Asset Special Fund (USD)

• Latest Performance: Year-to-date 2025 showing impressive 38.31% returns (gross), with net returns after fees approximately 24%
• Key Features: Similar lock-in periods and performance fee structures, focusing on global diversification
• Risk Rating: Category 7 (high risk, high reward)

Advantages of Special Funds:

• Potential for very high returns if market conditions are favorable
• Diversification: Exposure to multiple markets, asset classes, including global investments
• Active management with ability to go long & short, hedge positions
• Tax advantages: Many special funds in Kenya are tax-exempt

Risks and Disadvantages:

• Higher fees (management + performance fees) which can erode gains
• Volatility and downside risk: Exposure to equities, derivatives, foreign markets
• Lock-in periods and liquidity constraints
• Returns not guaranteed: Past strong performance may not persist

2. Stock Market – Dividend & Growth Stocks

The Kenyan stock market offers attractive opportunities through both dividend-paying stocks and growth-oriented companies, with some dividend yields significantly outpacing Treasury bill rates.

High Dividend Stocks in Kenya:

Standard Chartered Bank Kenya (Current Price: ~KES 280)

• 2025 Dividend Yield: 15.85% based on annual dividend of KES 45 per share
• Recent Dividend: Interim dividend of KES 8 paid October 2025, with final dividend of KES 37 paid May 2025
• Why Attractive: Known for stable dividend payments and strong banking fundamentals

British American Tobacco Kenya (Current Price: ~KES 430)

• 2025 Dividend Yield: 12.85%
• Recent Performance: Annual dividend of KES 55 per share
• Considerations: High dividend payer but subject to regulatory risks in tobacco industry

Growth Stocks – Kenya & USA:

Kenyan Growth Opportunities:

• Banks with expanding operations
• Technology and fintech companies
• Industrial and infrastructure companies

US Growth Stocks for Kenyan Investors:

• Technology sector stocks (AI, cloud computing)
• Companies like Nvidia, Amazon for capital appreciation
• Hybrid dividend + growth stocks like Microsoft, Apple

Advantages of Stock Market Investment:

• Dividend income provides regular cash flow
• Capital appreciation potential for significant wealth multiplication
• Liquidity especially in large, listed stocks
• Transparency and ownership stake in companies

Risks and Disadvantages:

• Dividend cuts possible during economic downturns
• High volatility in growth stocks with potential for significant losses
• Exchange rate risk when investing in US stocks from Kenya
• Knowledge requirement and potentially higher transaction costs

3. Money Market Funds (MMFs) in Kenya

Money Market Funds continue to offer attractive returns in the current interest rate environment, though yields have been declining through 2025.

Top 3 MMFs In Kenya & Current Returns (August 2025):

Gulfcap Money Market Fund

• Net Return: 10.96% (August 2025)
• Gross Return: 12.89% before fees and taxes
• Features: High liquidity, conservative investment approach

Cytonn Money Market Fund

• Net Return: 10.58% (August 2025)
• Gross Return: 12.45% before fees and taxes
• Track Record: Consistently among top performers

Nabo Africa MMF

• Net Return: 10.47% (August 2025)
• Gross Return: 12.32% before fees and taxes
• Accessibility: Good minimum investment requirements

Historical Performance Context:

Earlier in 2025 (February), MMFs showed even stronger performance with Gulfcap delivering gross yields around 16.3% and Cytonn at 16.1%, indicating the downward trend in rates through the year.

Advantages of MMFs:

• High liquidity: Quick redemption capabilities
• Lower risk relative to equities and other volatile investments
• Better returns than traditional bank savings accounts
• Capital preservation focus with moderate growth

Disadvantages and Risks:

• Lower returns compared to more aggressive investment options
• Inflation risk: Real returns may be minimal if inflation rises
• Interest rate sensitivity: Returns fluctuate with broader rate environment
• Fees and taxes reduce net yields

4. Fixed Income Funds / Government Bonds

Kenya’s bond market offers attractive yields, particularly for investors seeking predictable income streams.

Current Bond Yields (October 2025):

Government Bond Yields:

• 10-year Government Bond: 13.30% yield (October 2025)
• Infrastructure Bonds (15-25 year): Yields ranging from 13.90% to 14.35% from recent auctions
• Tax Advantage: Infrastructure bonds are withholding tax exempt

Fixed Income Fund Performance:

• Mayfair Fixed Income Fund: 15.17% gross return (July 2025), netting 12.89%
• Gulfcap Fixed Income Fund: 13.12% gross, 11.15% net
• Madison Fixed Income Fund: 11.63% gross, 9.89% net

Investment Access:

• Direct Bond Investment: Through banks or brokers at government auctions
• Fixed Income Funds: Pool with other investors for lower minimum requirements
• Payment Frequency: Semi-annual or annual coupon payments depending on bond terms

Advantages of Fixed Income:

• Predictable cash flow through regular coupon payments
• Lower volatility compared to equities
• Capital preservation if held to maturity (government bonds)
• Tax benefits available on infrastructure bonds

Disadvantages and Risks:

• Interest rate risk: Bond prices fall when rates rise
• Inflation risk: Fixed payments lose purchasing power
• Liquidity constraints: Some bonds not actively traded
• Withholding tax: 15% tax on interest income (except infrastructure bonds)

5. Real Estate Investment Trusts (REITs)

Kenya’s REIT sector shows mixed performance but offers exposure to real estate without direct property ownership challenges.

Kenya REITs Performance (H1 2025):

Strong Performers:

• Acorn D-REIT: Trading at KES 27.4 per unit, representing 37.0% gain from KES 20 inception price
• Acorn I-REIT: Trading at KES 23.2 per unit, showing 16.0% gain from inception
• LAPTRUST Imara I-REIT: Strong H1 2025 performance with 46% increase in rental income, 44% rise in net profit, and dividend yield of approximately 8.2%

Challenged Performers:

• ILAM Fahari I-REIT: Significant underperformance with 45% loss from inception price

Sector Performance Metrics:

• Combined Net Operating Income: 24.9% increase to KES 1.028 billion in H1 2025
• Funds from Operations (FFO): 38.5% increase to KES 1.157 billion
• Net Asset Values: 7.9% increase to KES 26.3 billion across all REITs

US REIT Option:

Vanguard Real Estate ETF (VNQ): Offers exposure to diversified US REIT market, combining dividend income with potential capital appreciation

Advantages of REITs:

• Income plus capital appreciation potential
• Higher liquidity than direct property ownership
• Professional management without direct property responsibilities
• Mandatory dividend distribution (most income must be paid as dividends)
• Tax incentives available in Kenya’s REIT structure

Disadvantages and Risks:

• Real estate sector risks: Vacancies, rent defaults, maintenance costs
• Interest rate sensitivity: Higher rates increase borrowing costs and reduce property valuations
• Limited liquidity: Kenyan REITs trade on over-the-counter platforms rather than main exchanges
• Regulatory and compliance risks
• Performance varies significantly between individual REITs

Investment Strategy Recommendations

For Kenyan investors in 2025, the optimal approach involves diversification across these investment types based on risk tolerance, investment horizon, and liquidity needs:

Conservative Investors: Focus on Money Market Funds (10-11% returns) and government bonds (13-14% yields) for capital preservation with steady income.

Moderate Risk Investors: Combine MMFs with dividend-paying stocks like Standard Chartered Bank (15.85% yield) and select REITs for balanced growth and income.

Aggressive Investors: Allocate significant portions to Special Funds (20%+ potential returns) while maintaining some exposure to growth stocks and international markets.

Diversified Portfolio: Spread investments across multiple categories to optimize risk-adjusted returns while maintaining liquidity for opportunities and emergencies.

The key to successful investing in Kenya’s current environment lies in understanding each investment vehicle’s risk-return profile, fees structure, and alignment with personal financial goals. With proper diversification and long-term perspective, investors can achieve significant wealth building through these high-return investment opportunities.