Aberdeen endures first-quarter outflows as Trump spooks EM investors

2nd Feb 2017 08:21

(ShareCast News) - Donald Trump's election win derailed a solid start to Aberdeen Asset Management's financial year, leading to £10.5bn of outflows from its emerging markets-focused funds as investors moved into less volatile assets. Offset somewhat by £3.3bn improvement in market performance and foreign exchange movements, there resulted a 3% shrinkage in assets under management for the first quarter to £302.7bn.Of the net outflows, the largest were the £6.6bn was from equities, £1.1bn from fixed income and £1.4bn from multi-asset, which the company dismissed as "largely low margin and anticipated", including two large equity mandates that it reported at the time of its final results.Furthermore, £2.2bn of the reduction in AuM was due to rationalisation of the US Fixed Income business, which will also see a further reduction of roughly £1bn in the first half of the year.While many investors were exiting, many were also entering, with gross inflows of £10.2bn in the quarter"Investor sentiment had been improving steadily in the early part of the quarter, but stalled following the US presidential election result with investors putting asset allocation decisions on hold," said chief executive Martin Gilbert, noting that despite the market volatility the equity performance produced strong returns last year."While growing interest in a number of our strategies is likely to continue to be masked, in the short-term, by significant withdrawals by a small number of clients, I am encouraged by the progress being made."There was said to be a healthy level of client interest and demand, in particular some growing institutional interest in its multi-asset strategies, as illustrated by a proposed transfer of a closed-end fund mandate to be managed by Aberdeen's Diversified Multi-Asset team.He said the business remains in good shape overall, highlighting the strong balance sheet, global client base and wide investor offer.