Aberdeen Asset Management is to impose a 2 per cent initial charge on its emerging markets funds after failing to quell investor interest in the range.
The £3.7bn Emerging Markets fund, the $15.5bn (£9.86bn) Aberdeen Global Emerging Markets Equity fund run by Devan Kaloo and the $2.7bn Aberdeen Global Emerging Markets Smaller Companies fund will all incur the charge.
“Against a backdrop of low interest rates, institutional and retail investor interest in emerging markets remains strong, with further flows expected into the asset class,” the group said.
The company said the drive to limit inflows was to prevent liquidity issues hampering the performance of the emerging market team.
A year ago the company asked advisers to take the then £2.7bn Aberdeen Emerging Markets fund and $9.8bn Aberdeen Global Emerging Markets Equity fund off buy lists and recommended lists.
John Brett, head of distribution at Aberdeen Asset Management, said: “Further inflows, if unchecked, will give rise to liquidity issues which may in time result in the investment team being forced to compromise its investment process, resulting in the introduction of lesser quality companies.”
The 2 per cent charge will be paid into the fund, and will begin on March 11 for the Luxembourg-domiciled funds, and April 15 for the UK-domiciled investment funds. There will be no difference to the annual management charge.
