Unit Trusts vs Fixed Deposits: What Investors Should Know

When you have money to invest in Ghana, two of the most common options are fixed deposits and unit trusts. Both can help your money grow, but they work very differently. Understanding these differences is essential to choosing the right option for your goals.

What Is a Fixed Deposit?

A fixed deposit is a savings product offered by banks. You agree to leave a specific amount of money with the bank for a fixed period—typically 30 days, 60 days, 91 days, 182 days, or 365 days. In return, the bank pays you a fixed interest rate.

The key feature is certainty. You know exactly how much interest you will earn, and you know exactly when you will get your money back. The rate is locked in from the day you invest.

In Ghana, fixed deposit rates vary significantly by bank and by the amount you deposit. According to Fidelity Bank’s rates for August 2026, a deposit of GH¢20,000 earns 0.25% for 30 days or 0.75% for 182 days. Larger deposits earn higher rates—over GH¢5 million earns 2.15% for 30 days or 2.65% for 182 days .

These are relatively low rates compared to the average deposit interest rate in Ghana, which stood at 10.5% as of March 2026. The difference reflects that the average includes longer-term deposits and different bank offerings.

What Is a Unit Trust?

A unit trust is a pooled investment fund managed by a professional fund manager. You buy “units” in the fund, and your money is invested across a mix of assets—government bonds, corporate bonds, stocks, and money market instruments.

The key feature is potential for higher returns, but with no guarantee. The value of your investment fluctuates based on how the fund’s underlying assets perform.

Unit trusts in Ghana come in different types:

• Money Market Funds – Low risk, invests in short-term instruments like Treasury bills

• Fixed Income Funds – Moderate risk, invests primarily in bonds

• Balanced Funds – Mix of equities and fixed income

• Equity Funds – Higher risk, invests in stocks

The Performance Difference

Recent performance data shows why unit trusts have become increasingly popular in Ghana.

The CAL Benefit Fixed Income Unit Trust delivered a 19.22% annual return in 2025 . The CAL Advantage Balanced Unit Trust returned 32.16% . Meanwhile, the average 364-day Treasury bill rate was 17.20% .

Compare that to the Fidelity fixed deposit rates for August 2026, where even large deposits of over GH¢5 million earned just 2.65% for 182 days .

The EDC Ghana Fixed Income Unit Trust, since its inception in January 2025, has yielded a compounded annual growth rate of 11.23% .

This performance gap explains why more Ghanaians are moving money from fixed deposits into unit trusts.

Key Differences at a Glance

What the Regulator Says

In 2018, the Securities and Exchange Commission (SEC) issued directives to all fund managers to stop offering guaranteed returns and fixed-term investments, requiring them to unwind such products within six months .

This is important because some investors still expect fund managers to offer fixed returns like banks do. Fund managers are not banks. Their job is to invest your money in opportunities that provide attractive returns while managing risk—not to guarantee a specific outcome .

As the SEC’s directive makes clear, if you want guaranteed returns, that is what banks and Treasury bills are for. If you want professional management and potential for higher growth, that is what unit trusts offer.

When Fixed Deposits Make Sense

Fixed deposits are suitable if:

• You want certainty and cannot tolerate any risk to your capital

• You need to park money for a short period with a known return

• You have a large sum that qualifies for higher rates

• You are approaching a goal and cannot afford market fluctuations

The main drawback is that your money is locked in. If you need it before the term ends, you will face penalties.

When Unit Trusts Make Sense

Unit trusts are suitable if:

• You want higher potential returns than fixed deposits offer

• You are willing to accept some risk in exchange for growth

• You want professional management without doing the research yourself

• You are investing for the medium to long term

• You want to start with a small amount (from GH¢20)

The main drawback is that returns are not guaranteed. During market downturns, the value of your investment can fall.

The Current Interest Rate Environment

The Bank of Ghana’s policy rate stood at 14.0% as of July 2026, with Databank Research projecting a cut to 12.5% in September 2026 . Inflation was 5.0% in August 2026, within the central bank’s target band of 8±2% .

When interest rates fall, fixed deposit rates tend to follow. This makes unit trusts relatively more attractive, especially equity-focused funds that can benefit from a lower-rate environment. CAL Asset Management noted that “declining interest rates prompted many investors to move funds into equities for higher returns” .

Quick Facts

Frequently Asked Questions

1. Are unit trusts better than fixed deposits in Ghana?
It depends on your goals. Fixed deposits offer guaranteed returns and capital protection. Unit trusts offer higher potential returns but with more risk. Many investors use both .

2. What is the current fixed deposit rate in Ghana?
Rates vary by bank and amount. Fidelity Bank’s rates for August 2026 range from 0.25% for a 30-day deposit of GH¢20,000 to 2.65% for a 182-day deposit of over GH¢5 million . The average bank deposit rate was 10.5% in March 2026 .

3. How much can I earn from a unit trust in Ghana?
Returns vary by fund. In 2025, CAL’s Fixed Income Unit Trust returned 19.22%, and its Balanced Unit Trust returned 32.16% . The EDC Fixed Income Unit Trust has a CAGR of 11.23% since inception .

4. Can fund managers offer guaranteed returns in Ghana?
No. The SEC issued directives in 2018 requiring fund managers to stop offering guaranteed returns and fixed-term investments. If you want guaranteed returns, you need a bank fixed deposit or Treasury bills.

5. What is the minimum investment for a unit trust in Ghana?
You can start with as little as GH¢20 with some providers .

6. Are unit trust returns tax-free in Ghana?
Yes. Returns from collective investment schemes are exempt from tax.

7. Which is more liquid: fixed deposits or unit trusts?
Unit trusts are more liquid. They are open-ended, so you can redeem your units at any time at the Net Asset Value. Fixed deposits lock your money in for the term, and early withdrawal usually attracts penalties.