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Aberdeen’s Gilbert feeling positive despite Trump slump

Martin Gilbert
Martin Gilbert

The election of President Donald Trump stalled “significant” investments for Aberdeen Asset Management in its most recent quarter.

But the fund manager’s chief executive Martin Gilbert said the firm remained convinced of its strategy of investing in emerging markets where sentiment has been hit as a result of the outcome of the US presidential election.

Revealing a 3% fall in assets under management in the quarter to £302.7billion to its shareholders at a meeting in Aberdeen yesterday, Mr Gilbert said the firm’s asset pickers were “mentally tough” enough to resist critics of the firm’s strategy.

A day after the UK parliament voted overwhelmingly to permit the government to press ahead with starting negotiations to withdraw from Europe, Mr Gilbert added that Brexit was “not a big thing” for Scotland’s estimated £1trillion asset management industry.

Analysts noted the firm reported its 15th consecutive quarter of net outflows for the firm – amounting £104.6billion of funds moved out from Aberdeen’s control.

Nevertheless Mr Gilbert was philosophical about the impact of the Trump presidency and optimistic about sentiment going Aberdeen’s way.

He said: “It is ironic isn’t it? Everyone else was quite happy with him being elected in the fund management world, except people who are invested in emerging markets.
“It has definitely hit confidence in emerging markets, but I think they will return. We are OK.

“It hasn’t been good for us in the last quarter.

“We were doing really well until then in performance terms.

“Sentiment was just coming back to emerging markets.

“One of the things we were seeing was people were just about to put significant amounts in just before the election.

“In our business you have to stick with your philosophy process.

“I have a saying: you mustn’t cut at the point of maximum pain

“You just have to stick with what you believe in.

“Our fund managers are mentally tough guys. They are very good.

“We have a strong balance sheet. We have fee income approaching £1billion.

“I’m very positive on the outlook.”

He added that asset management was a “major industry” in Scotland that was unlikely to be affected by Brexit.

He said: “We all tend to have operations in Luxembourg or Dublin. It is not a big thing for asset managers.”

In its update yesterday, Aberdeen revealed that it was hit by net outflows of £10.5billion which was offset by good investment performance adding £3.3billion. A further £2.2billion reduction in its asset pot was a result of rationalising its US fixed income business by withdrawing from low margin mandates.

The company expects investors to shift at least another £1billion from its management this year.

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