Aberdeen Standard Asia Focus PLC
Rated Fund 2019-20. A potential turnaround tale, but not for the risk-averse
This trust has gearing of more than 11% of its net assets in volatile Asian markets, so it’s not for the faint-hearted. Performance had not been great, but a recent revamp seems to be paying dividends. Over the past year, it has outperformed the MSCI AC Asia Pacific ex-Japan Small Cap index and is the top performer in the Asian smaller company sector (albeit of only three trusts). We are optimistic about further improvement.
In late 2018 Aberdeen Asian Smaller Companies investment trust was renamed Aberdeen Standard Asia Focus. It retains a focus on smaller companies, but it is becoming more concentrated, with the number of holdings falling from 80 to 60 (69 at present), 30 of which are considered ‘core’. “This is a promising start for the refreshed strategy, which continues to trade on a discount close to 10%,” said Markuz Jaffe, an analyst at Cantor Fitzgerald.
Veteran Asia investor Hugh Young runs the trust from Singapore. He believes small companies in Asia, with their greater exposure to domestic markets, provide investors with a comparatively safe harbour from the problems of trade disputes and currency fluctuations that have been dominating the news from the region.
He likes quality companies that are well-positioned to benefit from emerging technological trends and growing demand for better-quality products and services. His optimism comes amid signs of faster 5G adoption, which is among the structural drivers of Asia’s long-term growth. Other key themes include the shifting spending trends of the Asian middle class and growing infrastructure needs.
Shares in the trust have traded at a discount to net assets ranging from 7% to 19% over the past three years.
Narrative and ratings content all as of January 2020.See all Money Observer rated funds
|momo.com Inc||4.67 %|
|Bank OCBC NISP Tbk||3.70 %|
|AEM Holdings Ltd||3.67 %|
|Asian Terminals Inc||3.31 %|
|John Keells Holdings PLC||3.19 %|
|Cebu Holdings Inc||2.97 %|
|Mega Lifesciences PCL||2.84 %|
|Oriental Holdings Bhd||2.73 %|
|Hana Microelectronics PCL||2.65 %|
|Convenience Retail Asia Ltd||2.54 %|
|Asia - Emerging||63.06 %|
|Asia - Developed||31.88 %|
|Financial Services||17.03 %|
|Consumer Cyclical||16.61 %|
|Real Estate||11.06 %|
|Consumer Defensive||10.59 %|
Flavia Cheong, CFA, is the Head of Asia Pacific Equities on the Asian Equities Team of Aberdeen Standard investments, where, as well as sharing responsibility for company research, she oversees regional portfolio construction. Before joining Legacy Aberdeen in 1996, she was an economist with the Investment Company of the People’s Republic of China, and earlier with the Development Bank of Singapore. Flavia graduated with a BA in Economics and an MA (Hons) in Economics from the University of Auckland. She is a CFA charterholder.
Pruksa Iamthongthong is an Investment Director on the Asian Equities Team at Aberdeen Standard Investments. Pruksa joined Aberdeen Asset Management in 2007. Pruksa graduated with a BA in Business Administration from Chulalongkorn University, Thailand and is a CFA® charterholder.
Gabriel joined ASI in 2008 as part of the London-based Global Emerging Markets Equities team and transferred to Asian Equities in 2018. Gabriel graduated with a MA (Hons) in Land Economy from Selwyn College, Cambridge University and is a CFA Charterholder.
Hugh Young is Managing Director − Asia for Aberdeen Standard Investments. He was formerly a board director and head of Investment for Legacy Aberdeen (before its merger with Standard Life plc). Mr. Young joined Legacy Aberdeen in 1985 to manage Asian equities form its London office, having started his investment career in 1980. He founded Singapore-based Aberdeen asset Management Asia Limited in 1992. Mr. Young is a director of a number of Legacy Aberdeen subsidiary companies and of investment trusts and funds managed by Aberdeen Standard Investments. Mr. Young graduated with a BA (Hons) in Politics from Exeter University.
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