AAIF: Finding Attractively Valued Income Opportunities
Edison | Dec 18, 2018 05:47AM ET
Aberdeen Asian Income Fund (LON:AAIF) aims to provide its investors with an attractive income, plus the potential for capital growth, by investing across the Asia Pacific region. The fund’s target c 4.5% yield is fully funded from portfolio income. AAIF’s investment process is bottom-up, with a strong focus on finding quality companies at attractive valuations. The managers meet all the companies they hold at least twice a year, and place great emphasis on understanding each company’s balance sheet and growth drivers to ensure everything in the c 40–70 stock portfolio is worthy of its place. AAIF’s quality and income focus means it has a natural bias to some more defensive areas, which could stand it in good stead in the current bout of market volatility. Its managers note that valuations in Asia are low in relation to Europe, North America and their own historical averages, and some individual stocks are very inexpensive versus history.
Investment strategy: Focus on quality and value
In common with other funds managed by Aberdeen Standard Investments Asia (ASI Asia), AAIF follows a well-defined investment process, focused on finding quality companies trading at attractive valuations. The bottom-up investment process is backed up by extensive fundamental research and the team meets with all its holdings at least twice a year. Environmental, social and governance factors are embedded in the process, as good governance is a key indicator of quality.
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