Aberdeen fund cuts Japan for Brazil, India holdings

The Aberdeen Diversified Growth Fund has initiated investments in Brazil and India for the first time via the Aberdeen Global – Brazil Equity Fund (3%) and the Aberdeen Global – India Equity Fund (3%).

The 3% allocation to each Fund is a result of the management team taking profits and exiting their 6% position in Japanese equities.

The £41m Aberdeen Diversified Growth Fund (launched 1 Nov 2011) is managed by a nine-strong team based in Edinburgh. It aims to achieve a cash + 4.5% p.a. return over the medium term.

The Brazil and India funds are run by Aberdeen global emerging markets and Asia Pacific equity teams respectively. The teams employ Aberdeen’s group-wide equity investment process which focuses on fundamental, bottom-up company research.

Mike Turner (pictured), head of Global Strategy & Asset Allocation at Aberdeen, said the fund’s Japanese equity exposure has performed well. “We remain optimistic about the prospects of selective Japanese companies. However, the existing problems of an aging population and an unsustainably high debt burden in the context of an increasing reliance on external funding represent a huge challenge for policy makers. Against this background, a longer-term negative view on Japanese assets arguably remains justified.”

“Whilst mindful of the headwinds for the global economy, in particular the eurozone crisis, equity valuations are reasonable. Furthermore, our Asia Pacific and emerging market equity teams’ bias towards financially strong, well run, domestic growth oriented companies offers us comfort should economic conditions worsen. The fund also remains well diversified across equities, fixed income, property and alternative investments.”

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