Citywire A-rated Fiona Gillespie, manager of the £600 million Aberdeen Multi-Asset fund, is considering whether to soften her defensive view and what asset classes would best express greater optimism.
Speaking ahead of the European Central Bank’s (ECB) announcement of a new bond-buying plan, she said although the eurozone threat had not dissipated, she was encouraged by the bank’s change of language.
‘We have not been acting drastically of late. We have kept a reasonably defensive view,’ she said. ‘But we have been questioning that view and looking at whether there are any small changes in the risk appetite. Economic data has not been great but there are some signs of stabilisation there.’
Gillespie said the odds on the eurozone breaking up had probably reduced. ‘People have been too sceptical,’ she said.
Gillespie said there were several intermediate steps she could take to add risk to her portfolio, like adding corporate or high yield credit or gold, before adding equities. She recently took a tentative step back into gold via an exchange traded fund.
‘If you are highly confident your view is correct, you go straight into equity,’ she said.
September would be a tricky month for markets, she predicted. ‘We have elections in Holland, the ECB and Federal Reserve meeting, and the Constitutional Court decision in Germany [over the ECB’s actions], so it’s fraught with political positives and negatives.’
Gillespie recently reduced exposure to hedge funds and hedge fund strategies.
‘[Hedge funds are] a diversifier. We have been reducing our allocation [to them],’ she said.
She has added 2% to her infrastructure holdings. ‘[Infrastructure] can be relatively boring as a sector as it isn’t so volatile, which is good for us, but it also gives a nice yield,’ she said. ‘HICL for example, the old HSBC infrastructure fund, yields 5.6%.’
She buys mostly government-backed infrastructure, which brings a degree of security.
‘People may argue on that one,’ she said. ‘What we have seen recently was the South London Hospital Trust going bust, and that shows you that this type [of infrastructure] is not immune.’
The Aberdeen Multi-Asset fund has returned 288.98% since launch at the end of March 1991, compared with the 459.27% return of the LCI Mixed Asset benchmark over the same period.
Gillespie took over the fund in December 2003, and over the last three years it has outperformed, returning 34.04% compared with the benchmark’s 29.89%.
‘Over one year it’s in the first quartile,’ said Gillespie. ‘Our performance has been quite stellar compared with our peer group in particular.’
While underperforming its benchmark since launch in 1991, the fund has outperformed recently: