Schroder ISF Emerging Multi-Asset Income

Coast through the investment highway of multi-asset opportunities in emerging markets

Emerging Markets (EM) are one of the world’s most exciting investment opportunities, offering investors potential for both income and growth. Income remains important in the current environment of still low interest rate, while the improving economies globally could also bring more growth opportunities in EM. The fund adopts the flexible multi-asset investment approach to tap into these interesting income and growth opportunities.


Why invest in the Schroder ISF Emerging Multi-Asset Income?

Capture higher growth potential in Emerging Markets

  • EM economies generally own more land, resources and have relatively higher potential GDP compared to developed economies. The International Monetary Fund (IMF) also expects to see an additional one billion middle class consumers in EM economies over the next 15 years.
  • Economic growth in EM is recovering and EM has a growth premium over developed markets.
  • Recovery in trade should benefit EM, particularly Asian manufacturers, and the recovery in commodity prices should benefit Latin America and Russia.
  • Emerging equities continue to offer a valuation discount versus their developed peers which helps to attract global fund inflows and supports the market performance.
  • EM fixed income has higher yields compared with developed markets and also benefits from falling inflation and low interest rates.

Source: Schroders Economics Group, May 2017

A diversified and dynamic approach to tapping into the opportunities

  • The fund harvests income and growth opportunities from a range of different asset classes, including emerging market equities, bonds, frontier markets equities, local currency and US dollar-denominated emerging sovereign debt, corporate debt and currencies.
  • We source opportunities across asset classes, regions and sectors when establishing the asset allocation – in order to take advantage of income and growth opportunities wherever they exist.

Offers an attractive and sustainable monthly payout^

  • The fund derives its income from a wide range of emerging market asset classes, these diverse sources of income aim to provide investors with attractive fixed payout of 5% p.a. for USD A distribution share class^ .

Focus on quality and risk management to mitigate volatility

  • We prioritise the consistency and sustainability of income. We therefore focus on the quality of securities, looking for equity and fixed income investments where the yield is supported by strong fundamentals.
  • We will not compromise on the quality of the securities we hold in order to achieve a higher yield.
  • We operate a robust risk management process, pursuing a diversified approach and monitoring risk at both a portfolio and security level in order to mitigate the volatility of the fund.

Why Schroders?

Managed by specialist investment teams

The fund is managed by the Multi-Asset investment team, which is responsible for overall asset allocation and risk management. Individual security selection is carried out by security specialists: the Multi-Asset Advanced Beta team for equities, and the global Fixed Income team for bonds.

Extensive resources and insights

Our Multi-Asset investment team is well resourced, with over 80 professionals globally. We have Multi-Asset professionals located in key financial locations across the globe including London, New York, Zurich, Hong Kong, Singapore and Sydney, managing over US$ 84 billion (as at 30 June 2017) in multi-asset mandates. Our team is dedicated to working closely with our clients to provide portfolios that are structured in line with their long-term performance objectives.

Schroder International Selection Fund is referred to as Schroder ISF.
^ The monthly distribution is applicable to A class USD and AUD Hedged distribution classes. The manager will make distributions in respect of distribution units. The manager has the sole and absolute discretion to vary the rate and/or frequency of distributions, subject to one month’s prior notice to the relevant unitholders. Distribution yield is not indicative of the return of the fund. Distribution may be paid from capital of the fund. Investors should note that where the payment of distributions are paid out of capital, this represents and amounts to a return or withdrawal of part of the amount you originally invested or capital gains attributable to that and may result in an immediate decrease in the value of units.
Source: Schroders. Investment involves risks. Please refer to the relevant offering documents for fund details including risk factors. This material is issued by Schroder Investment Management (Hong Kong) Limited and has not been revised by the SFC.

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