Notification of changes to the underlying funds of various Aberdeen funds
17 January 2020
J96 Aberdeen Standard SICAV I Technology Equity
P33 Aberdeen Standard SICAV I Chinese Equity
P54 Aberdeen Standard SICAV I Indian Equity
P65 Aberdeen Standard SICAV I Asia Pacific Equity
R11 Aberdeen Standard SICAV I Emerging Markets Smaller Companies
We have been notified by Aberdeen Standard Investments (“The Company”) of the upcoming changes to the investment policy of the underlying funds of the above named mirror funds. These changes will come into effect from 17 February 2020 (the “Effective Date”).
Update to the investment policies of the underlying funds of the above named mirror funds concerning use of benchmarks
The investment objective and policy section of the underlying funds of the above named mirror funds within the Company has been updated to include additional information on use of benchmarks.
In particular and from the Effective Date, this section will now state that the underlying funds are actively managed and specify whether or not a benchmark plays a role (even if minimal) in the management of the underlying funds, as well as the degree of freedom that the Investment Manager(s) have in relation to that benchmark. For instance, an underlying fund may aim to outperform a benchmark or may be managed within risk constraints which limit the deviation between investments, their weightings and the expected performance relative to a benchmark.
The updated disclosures address the new requirements laid down by the European Securities Markets Authority in their Q&A on the application of the UCITS Directive dated 29 March 2019.
For the avoidance of doubt, this additional information intends to provide more insight to investors but in no way changes the way in which the underlying funds are managed in practice nor modifies the investment objective and policy nor the risk profile of the underlying funds except as otherwise stated in this letter.
Update to the Risk Management Process Section in relation to the use of the Commitment approach
- This Section currently states that:
"The underlying funds which will either not use financial derivative instruments or limit their use of hedging strategies will be monitored using the commitment approach"
The underlying funds which make use of financial derivative instruments for investment purposes on a limited basis for cash management only and which use the Commitment approach to determine their global exposure.
Therefore, the section has been amended for clarification as follows:
"The underlying funds which will not use financial derivative instruments or limit their use to hedging strategies or make use of financial derivative instruments for investment purposes but only to a limited extent for cash management will be monitored using the commitment approach"
Change to the definition of Emerging Market
Currently, an Emerging Market is defined as “Any country that is included in the MSCI Emerging Markets Index or composite thereof (or any successor index, if revised), or any country classified by the World Bank as a low to upper middle income country”.
The definition has been updated to include additional indices so that both equities and fixed income asset classes are represented, as follows: “Any country that is included in the MSCI Emerging Market series of indices or FTSE Emerging Markets series of indices or JP Morgan Emerging Market series of indices (or composites thereof or any successor series) or any country classified by the World Bank as a low to upper middle income country”.
Should you have any questions regarding these changes, please contact International Funds & Investments.