Aberdeen says clients “more comfortable” with EM

A weaker sterling following the Brexit vote helped Aberdeen Asset Management achieve positive investment performance by offsetting outflows, the company said.

Aberdeen, which has seen some clients exit from emerging markets in recent months and more recently a Brexit-exposed UK property fund, saw its assets under management (AUM) rise to £301.4 billion (€359.7 billion) from just under £293 billion in the previous quarter.

However, in the nine months to June 30, Aberdeen saw £25.6 billion of net ouflows, according to a quarterly trading update today.

Aberdeen, a noted emerging markets investor, said the weakening of sterling against most major currencies contributed to the AuM increase.

“Currency, exposure to a broad mix of assets and good investment performance outweighed the net outflows the business experienced this quarter,” Martin Gilbert, chief executive, said.

Outflows for the quarter were £8.9 billion, but assets appreciated by £17.5 billion.

The company said net outflows from equities showed a “small improvement” on the previous quarter, “partly reflecting investors’ comfort with their current exposure to emerging markets”.

Markets showed a “strong recovery” after the market volatility in the last week of June when investors reacted to the result of the UK referendum on EU membership.

“We expect some continuing volatility in UK and European equity markets as the political negotiations around Brexit proceed. However, broader equity markets have been reasonably resilient, as have other asset classes,” Aberdeen said.

©2016 funds europe