Aberdeen to soft-close £2.7bn emerging markets fund

Aberdeen Asset Management is soft-closing its £2.7bn onshore emerging markets fund and its £6bn offshore emerging markets fund.

The onshore fund, which is managed by Devan Kaloo, is a favourite in the IFA space and is currently top quartile in the IMA global emerging markets sector. It saw returns of 103 per cent over the past three years, compared to a sector average of 78.7 per cent.

The £6bn offshore global emerging markets fund is also a top quartile performer in the sector.

Aberdeen is asking IFAs to remove the two funds from their buylists by April 1, 2012 and is ready to implement other measures, which could include raising fees and closing share classes.

Aberdeen says that were the funds to continue to grow at their current pace they would run into liquidity issues in some of their holdings. Aberdeen has already introduced several measures to stem flows in the past few years. These include closing to new segregated business, capping existing segregated accounts and ending the pro-active marketing of its pooled funds.

Chelsea Financial Services managing director Darius McDermott says: “It is good to see Aberdeen protecting its emerging markets franchise, which runs into billions of pounds. However, it is disappointing as there are few rivals to Aberdeen’s emerging markets offering aside from First State. It will be interesting to see if they have to introduce further measures to stem the flows.”