Aberdeen Asset Management says its efforts to control runaway inflows into its global emerging markets funds have succeeded in reducing new money flows to a manageable level.
The company said in February it would close its US-domiciled global emerging markets (GEM) pooled funds to new investors and introduce a 2% upfront charge on new investments into those same funds domiciled in Luxembourg and the UK.
“In the short period since implementation of these measures, we have seen a considerable reduction in inflows to our GEM strategy and we believe that net inflows in future periods will be at more sustainable levels,” says the company in a trading update.
Having too much new investor money may seem a cause for celebration, not concern, but Aberdeen says it is challenging to absorb large sums without compromising the funds’ performance.
Across all its funds, the company registered net inflows of £3.5 billion (€4.1 billion) in the first two months of the year – the result of strong investor demand for equity products offset by small outflows in Aberdeen’s fixed income, money market and Aberdeen solutions funds.
Market growth and supportive exchange rate movements powered an increase in assets under management of nearly £20 billion in two months, leaving the company with £212 billion under management at the end of February.
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