Edison issues review on Abrdn Asian Income Fund

RNS Number : 2028B

abrdn Asian Income Fund Limited

30 September 2022

 

London, UK, 30 September 2022

Edison issues review on Abrdn Asian Income Fund (AAIF)

While western economies have been struggling with soaring inflation, rising interest rates and slowing economic growth, the managers of abrdn Asian Income Fund (AAIF) note that Asian markets, while not immune to these pressures, have generally not faced headwinds of the same magnitude. Asian markets have outperformed global equities in 2022, with the Indian, Australian and Hong Kong markets being especially buoyant. The economic issues facing Asia differ from those seen in the west. Arguably, the structural fundamentals for the region as a whole are more supportive in that the demographics underpin better long-term demand, with higher growth and lower levels of personal, corporate and government debt. In addition, Asian equity markets are trading on lower forward valuations compared with other geographic regions. China, which accounted for c 30% of equity markets and 46% of the region's GDP in 2021, remains a source of both optimism and concern. On the one hand, it is in a position to loosen monetary policy (as inflation is not yet a concern) but on the other hand there is political uncertainty due to the presidential elections in Q322, coupled with ongoing zero-COVID-19 lockdowns and continued geopolitical tensions around Taiwan.

Abrdn uses its long-established investment process to manage AAIF. The team is one of the largest in the region, with more than 40 analysts and portfolio managers, and has an in-depth knowledge of and strong presence in the region. AAIF's NAV performance has been solid since its launch in December 2005 as a result of abrdn's pragmatic investment approach that offers a premium and growing income versus the wider Asian market while delivering capital growth for investors. AAIF trades on one of the widest discounts in the sector, which we feel is unwarranted given the fund's strong fundamentals of process and team track record.

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