Reasons why: Emerging market debt

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1 For professional investors and financial advisers only not for use by retail investors Reasons why: Emerging market debt February Attractive yields in emerging market (EM) debt Yield (%) EM HC Sovereign EM LC Sovereign DM Sovereign Emerging market debt offers an attractive solution in a yield starved world Brett Diment Head of Global Emerging Market Debt Sovereign: JPM EMBI Global Diversified Index; EM LC Sovereign: JPM GBI-EM Global Diversified Index; DM Sovereign: JPM GBI Global Index. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. Individuals cannot invest directly in an index. Past performance is not a guide to future results. Source: JP Morgan, 31 December For illustrative purposes only. 2Commodity Consumption (%) China is of far greater importance for commodities than the US Copper Coal Aluminium Nickel Iron ore Zinc China US Rest of world China is the world s largest consumer for many commodities, and its consumption dwarves that of the USA Source: BP Statistical Review, World Steel Association, China Customs, Bloomberg, Jan 17 Reasons why series Page 1 of 5

2 3There has been a dramatic improvement in EM currency valuations Average real effective exchange rate in EM (ex-china, 2010=100) Nov 96 Nov 98 Nov 00 Nov 02 Nov 04 Nov 06 Nov 08 Nov 10 Nov 12 Nov 14 Nov 16 The correction in EM currencies over the past five years is similar to the correction seen during the Asia crisis when EM currencies generally changed from fixed to floating exchange rates At the start of 2016 EM currencies approached the bottom of their 20-year range Source: Aberdeen, BIS (Bank for International Settlements), 30 November GDP (Gross Domestic Product) weighted index of 14 emerging market countries. 4Diversification Percentage GDP growth, constant prices Our investment process We focus on the entire EM debt universe to maximise the return potential and minimise risk. We conduct comprehensive country research, set in the context of global economic developments, which forms the foundation of our investment process. We look at factors such as: Key macroeconomic variables The political environment Fiscal and monetary policy developments and major risk. This is coupled with analysis of technical market indicators such as: The nature of instruments Relative value Liquidity Demand and supply imbalances Forecast Euro area Major advanced economies (G7) Emerging market and developing economies The EM debt universe offers many attractive opportunities across hard currency sovereigns, quasi-sovereigns and corporates, as well as in local currency sovereigns and foreign exchange. We build diverse portfolios from the bottom up, investing in nearly 50 countries. Source: International Monetary Fund, World Economic Outlook, October For illustrative purposes only. Diversification does not ensure a profit or protect against a loss in a declining market. Figures may appear not to add due to rounding. For illustrative purposes only. 5 Emerging market resources Combined emerging market debt and equity expertise Local presence, with over 80 EM investment professionals worldwide $90bn in EM assets, with over $11bn in EM debt London Budapest Hong Kong Bangkok Over 80 countries and 1,000 companies researched Source: Aberdeen Asset Management, 30 September Sao Paulo Singapore Jakarta Kuala Lumpur Sydney Exceptional depth and breadth Reasons why series Page 2 of 5

3 Our strategies $11bn in assets under management Source: Aberdeen Asset Management. 30 September 2016 EMD Plus invests in hard currency sovereign, quasi sovereign and corporate bonds, local currency sovereigns and currencies Pooled fund: AG Select Emerging Markets Bond Fund ($1,626m) Benchmark: AG Select Emerging Markets Investment Grade Bond Fund ($101m) Aberdeen Emerging Markets Bond Fund ($118m) JP Morgan EMBI Global Diversified $4,265m EMD Local Currency invests primarily in local currency sovereign bonds and currencies Pooled fund: AG Emerging Markets Local Currency Bond Fund ($184m) Benchmark: JP Morgan GBI-EM Global Diversified $1,586m EMD Corporate invests primarily in hard currency corporate bonds Pooled fund: AG Emerging Markets Corporate Bond Fund ($244m) Benchmark: JP Morgan CEMBI Broad Diversified $759m A EMD Core invests primarily in hard currency sovereign and quasi sovereign bonds No pool fund Benchmark: JP Morgan EMBI Global Diversified $ 1,587m EMD Total Return invests in hard and local currency sovereigns and quasi sovereign bonds (more than 50% government owned) and currencies from emerging market and develop market countries Pooled fund: AG II Emerging Markets Total Return Bond Fund ($59m) Benchmark: Citigroup WGBI US $68m Asian Local Currency invests primarily in Asian local currency denominated bonds Pooled fund: AG Asian Local Currency Short Duration Bond Fund ($206m) Benchmark: iboxx Asia ex Japan Sovereign 1-3y $962 B Asian Credit invests primarily in hard currency bonds issued by Asian corporates Pooled fund: AG Asian Credit Bond Fund ($30m) Benchmark: JPMorgan Asia Credit Index $886m C Asian Diversified invests in hard and local currency sovereigns, quasi-sovereigns and corporate bonds and currencies from Asian countries Pooled fund: AG II Asian Bond Fund ($80m) Vehicle domiciled in US ($30m) Benchmark: Markit iboxx ALBI $217m Single Country invest primarily in local currency sovereign, quasi-sovereign and corporate bonds Pooled fund: AG Brazil Bond Fund ($38m) AG Indian Bond Fund ($80m) Vehicles domiciled in Thailand ($224m), Indonesia ($48m) $391m EMD Frontier invests in hard and local currency sovereigns, quasi-sovereigns and corporate bonds and currencies from frontier markets Pooled fund: AG Frontier Markets Bond Fund ($78m) Benchmark: JP Morgan NEXGEM $78m A $1,157m including off benchmark allocations to EM corporates within our EMD Plus strategy B $1,423m including allocations to Asian local currency strategy within the Asian Diversified Strategy and single country Thai and Indonesian funds C $994m including allocations to Asian credit within the Asian diversified strategy Source: Aberdeen Asset Management. 30 September 16 Notes: EMD (Emerging Market Debt); EMBI (Emerging Market Bond Index); CEMBI (Corporate Emerging Market Bond Index); NEXGEM (Next Generation Markets Index); WGBI (World Government Bond Index); ALBI (Asian Local Bond Index) Reasons why series Page 3 of 5

4 The investment team Brett Diment (25) (L) Head of Global EMD EMD Sovereign Edwin Gutierrez (21) (L) Head of EMD Sovereign Asian Fixed Income Adam McCabe (16) (S) Head of Asian Fixed Income EMD Corporate Siddharth Dahiya (11) (L) Head of EMD Corporate Sovereign Corporate Kevin Daly (28) (L) Viktor Szabó (16) (L) Andrew Stanners (16) (L) Anthony Simond (8) (L) Patty Cao (5) (L) Imre Tajti (14) (B) Kenneth Akintewe (16) (S) Leong Lin Jing (7) (S) Lee Jin Yang (5) (S) Edmund Goh (7) (KL) Pongtharin Sapayanon (14) (BK) Suhardi Tanujaya (22) (J) Thomas Drissner (14) (S) Gareth Nicholson (13) (S) Jeremy Teng (10) (S) Carol Yuan (10) (SY) Henry Loh (3) (S) Mohammad Hasif (6) (KL) Tai Li-Yian (3) (K) Max Wolman (17) (L) Paul Lukaszewski (16) (L) Kathy Collins (9) (L) Samuel Bevan (5) (L) Henrique Morato (3) (L) Wendy Tjandra (18) (J) Specialised Resources Portfolio Analysts Neil Clayton (12) (L) May Hoang (8) (L) Quant Echo Yang (9) (S) Dealers Andrew Ng (10) (S) Abel Koh (5) (S) Russell Beer (15) (L) Restructuring & Insolvency Cecely Hugh (10) (L) Product Specialists Karen Bater (32) (P) Helen Winter (20) (L) Experienced, stable team with a broad range of specialist skills Global interaction: Team-based, formal weekly portfolio review and six-weekly strategy meetings Regular meetings with EM equity, global macro and US fixed income teams (-) denotes years industry experience. L= London, B = Budapest, S = Singapore, KL = Kuala Lumpur, BK = Bangkok, J = Jakarta, SY = Sydney Source: Aberdeen Asset Management, 30 September 2016 Reasons why series Page 4 of 5

5 The value of investments and the income from them can go down as well as up and your clients may get back less than the amount invested Contact details Should you require any further information, please visit aberdeen-asset.com for details of your local Aberdeen representative. Important Information For professional investors and financial advisers only - not for use by retail investors The above marketing document is strictly for information purposes only and should not be considered as an offer, investment recommendation or solicitation, to deal in any of the investments or funds mentioned herein and does not constitute investment research as defined under EU Directive 2003/125/EC. Aberdeen Asset Managers Limited (Aberdeen) does not warrant the accuracy, adequacy or completeness of the information and materials contained in this document and expressly disclaims liability for errors or omissions in such information and materials. Any research or analysis used in the preparation of this document has been procured by Aberdeen for its own use and may have been acted on for its own purpose. The results thus obtained are made available only coincidentally and the information is not guaranteed as to its accuracy. Some of the information in this document may contain projections or other forward looking statements regarding future events or future financial performance of countries, markets or companies. These statements are only predictions and actual events or results may differ materially. The reader must make their own assessment of the relevance, accuracy and adequacy of the information contained in this document and make such independent investigations, as they may consider necessary or appropriate for the purpose of such assessment. Any opinion or estimate contained in this document is made on a general basis and is not to be relied on by the reader as advice. Neither Aberdeen nor any of its employees, associated group companies or agents have given any consideration to nor have they or any of them made any investigation of the investment objectives, financial situation or particular need of the reader, any specific person or group of persons. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of the reader, any person or group of persons acting on any information, opinion or estimate contained in this document. Aberdeen reserves the right to make changes and corrections to any information in this document at any time, without notice. The funds referenced are Luxembourg-domiciled UCITS funds, incorporated as a Société Anonyme and organised as a Société d¹investissement à Capital Variable (a SICAV). The information contained in this marketing document should not be considered as an offer, or solicitation, to deal in the shares of any securities or financial instruments. It is not intended for distribution or use by any person or entity who is a citizen or resident of or located in any jurisdiction where such distribution, publication or use would be prohibited. The Funds are not registered under the United States Securities Act of 1933, nor the United States Investment Company Act of 1940 and therefore may not directly or indirectly be offered or sold in the United States of America or any of its states, territories, possessions or other areas subject to its jurisdiction or to or for the benefit of a United States Person. No information, opinions or data in this document constitute investment, legal, tax or other advice and are not to be relied upon in making an investment or other decision. Subscriptions for shares in the Funds may only be made on the basis of the latest prospectus, relevant Key Investor Information Document (KIID) and Supplementary Information Document (SID). These can be obtained free of charge from Aberdeen Asset Managers Limited, 10 Queens Terrace, Aberdeen, AB10 1YG, Scotland and are also available on aberdeen-asset.com. Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future. You should obtain specific professional advice before making any investment decision. Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Reasons why series Page 5 of 5 DH: GB /17