Aberdeen Standard Investments (ASI) has successful launched its first Fixed Maturity Product (FMP). During September it raised $167m for the Emerging Markets Bond Fixed Maturity 2023 fund.
The Luxembourg-domiciled Fund aims to achieve income and capital preservation over its term (to October 2023) by investing at least two-thirds of the fund's assets in emerging market government and corporate bonds. A FMP is a portfolio of carefully selected bonds that have matching maturities to the term of the fund. It attracted interest from investors across Asia and Europe.
Campbell Fleming, global head of Distribution at Aberdeen Standard Investments, said: "Record low yields have left investors with the increased risk of eroding their wealth over time. With interest rate at extremely low, investors are looking for sustainable sources of income.
A Fixed Maturity Product could potentially help investors fill this income gap"
"A Fixed Maturity Product could potentially help investors fill this income gap. The long-term aim is for the Emerging Markets Bond Fixed Maturity 2023 Fund to be the first in a series of FMPs - capitalising on the breadth and depth of our fixed income platform - we launch to help meet the needs of investors around the world."
Brett Diment, head of Global Emerging Market Debt at Aberdeen Standard Investments, added: "The size and scale of our Emerging Market Debt team, which includes 51 people across the world, allows us to research a broad set of assets, and select some of the best issuers to create a diversified and robust investment proposition.
"Idiosyncratic risk and avoiding defaults are particularly important in FMPs, and our strong emphasis on undertaking detailed fundamental research, including making over 50 country visits each year and over 700 company visits, is key in managing such risks".
Overall ASI manages over $170bn in fixed income portfolios of which over $15bn is invested emerging market bonds.
This article was first published by Investment Europe, a sister title to International Investment.