abrdn is relaunching abrdn SICAV I-Emerging Markets Sustainable Equity Fund under the new name abrdn SICAV I-Emerging Markets Ex China Equity Fund. The fund is introducing a series of changes for investors looking to explore further opportunities in emerging markets, the asset manager said. abrdn revealed that this fund is available in spain and the usa
First, as Abrdn explained, the decision to exclude China is in response to demand from investor groups for active options to manage their exposure to China. abrdn continues to offer a wide range of strategies, including China, while responding to customer demand for diversification of choices.
Across the industry, the number of companies managing emerging market strategies excluding China grew from three in 2017 to nearly 50 by 2024, according to Morningstar. abrdn has been managing the emerging markets strategy excluding China for the US market since March 2022. Emerging markets are also expected to account for nearly 50% of global growth by 2050, according to ABRDN’s Global Macro Research, and this shift, according to ABRDN, is driven by increasing opportunities in emerging markets. The time has come.
It is also noted that the relaunched fund’s manager will be an ex-China emerging markets portfolio construction team based in London and Singapore. Nick Robinson and Devan Carew in London, and Xing Yao NG in Singapore, supported by a broader global emerging markets equities team. It has offices in five locations outside China, from São Paulo to Singapore.
“This is not to negate the Chinese market, as China has some great companies and is poised to overtake the United States and become the world’s largest economy by around 2035. We recognize that families are looking for more flexibility in their approach to China. Ultimately, the choice is one that embraces some of the key megatrends that will drive emerging markets in the future. We see four strong themes impacting the world of former China: consumption, technology, green transition, and migration. Invests in more companies: The non-China universe includes more information technology and financial companies at the index level than a standard emerging market index, which also provides sector diversification. The team believes the strength of the tech sector will continue to extend beyond the U.S. market and occupy a significant active position in companies benefiting from AI investments,” said Nick, Deputy Head of Global Emerging Markets Equities at abrdn.・Robinson stated.
The Fund remains classified under Article 8 of the SFDR and continues to be subject to the NBIM Exclusion List. The benchmark index will switch to the MSCI Emerging Markets (excluding China) 10/40 Index (USD). These changes do not change the Fund’s risk profile. The fund will follow abrdn’s “Ex-China Emerging Markets Equity Investment Approach that Promotes ESG Aspects.”
By applying this approach, the fund commits to holding at least 10% in sustainable investments. This is a reduction from the current 20% commitment to sustainable investing. At the index level, MSCI Emerging Companies includes 1,328 companies, while MSCI Emerging Companies Excluding China only includes 673 companies. The fund continues to use a qualitative identification process and incorporates negative screening based on the United Nations Global Report to avoid investing in companies that lag in ESG performance. Compact, Norges Bank Investment Management (NBIM), controversial weapons, tobacco production, thermal coal. The fund will also maintain explicit ESG objectives, as outlined in its new investment objectives and policies.
