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# Aberdeen Asia-Pacific Income Investment Company Limited
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Daily Data

At close Dec, 18 2014

NAV$5.46
Price$4.53
Premium/Discount-17.06%

NAV and prices are provided by Morningstar. This information is unaudited and neither Aberdeen Asset Management PLC, its wholly owned subsidiaries, the Funds, nor any other person guarantees their accuracy.

 
 

Contact Us

Tel: +(1) 800 992 6341
Fax: +(1) 866 354 4005

investorrelations@aberdeen-asset.com

 

Aberdeen Asia-Pacific Income Investment Company Limited (TSX: FAP)

Investment Objective

The investment objective of the Company is to obtain current income and achieve incidental capital appreciation from investment in long-term debt securities. The Company may invest up to 80% of total assets in securities issued by Asian entities.

 
Adam McCabe

Fund Manager Interview

Adam McCabe, Head of Asian Fixed Income, discusses why we believe Asia’s fundamentals remain robust, with rising incomes and an expanding middle class underpinning domestic demand.

Download now
 
 
 

Manager's Monthly Report

October 2014

  • It was a weak September for Asian bond markets and currencies, as the prospect of tighter U.S. monetary policy quelled appetite for emerging-market assets and buoyed the U.S. dollar. In addition, geopolitical risks in Ukraine and the Middle East as well as economic weakness in China and Europe clouded the still uncertain global recovery.
  • During the month, the policy divergence between Europe and the U.S. turned starker. In a bid to counter the deflation threat and spur lending, the European Central Bank (ECB) cut deposit rates to below zero and offered up to €400 billion (approximately US$508 billion) in cheap short-term loans to banks (although the take-up was disappointing). In contrast, the U.S. Federal Reserve (Fed) is moving in the opposite direction, as data seemed to confirm a more robust recovery. It will end its asset purchases by the end of October. Although Fed Chair Janet Yellen committed to keeping interest rates near zero for a considerable time, she cautioned that this stance could change if the economy continued to exceed expectations.
  • In China, a sluggish property market, slowing credit growth and weak industrial production deepened concerns over the economy, while protests against electoral reforms in Hong Kong depressed sentiment further. Despite the pressure on growth, Chinese premier Li Keqiang ruled out any major stimulus and emphasized targeted measures to buttress weaker sectors instead. Fresh measures this month included the provision of 500 billion yuan (roughly US$81.5 billion) in liquidity to the top five domestic lenders and the loosening of mortgage rules to stimulate genuine demand. Against this backdrop, the onshore bond market was among the best regional performers, led by the longer end of the yield curve, while the yuan was resilient.
  • Indian bonds posted gains but the rupee lost ground as inflation started to ease, the current account deficit narrowed and the government undertook bond buybacks worth almost 130 billion rupees (about US$2.1 billion). Rating agency Standard & Poor’s (S&P) upgraded the country’s credit outlook from negative to stable, which further supported the market (see “Focus - India: more good news” on page 2).
  • Another good performer was the Korean bond market, underpinned by expectations of an interest rate cut of 25 basis points (bps). This followed the finance ministry’s announcement that it would pumpprime1 the economy. The ministry also placed pressure on the central bank to synchronize policies.
  • Conversely, longer-dated bonds in both Hong Kong and Singapore tracked the weakness in 10- year U.S. Treasury yields, which rose by 15 bps to 2.49%. The Indonesian Parliament passed a law scrapping direct local elections, which was perceived as a political setback for President-elect Joko Widodo because it erodes the people’s right to choose leaders and gives more power to the opposition-controlled Parliament. This weighed on the rupiah and domestic bonds. Markets in Malaysia, Thailand and the Philippines saw virtually flat returns for the month.
  • Conversely, longer-dated bonds in both Hong Kong and Singapore tracked the weakness in 10- year U.S. Treasury yields, which rose by 15 bps to 2.49%. The Indonesian Parliament passed a law scrapping direct local elections, which was perceived as a political setback for President-elect Joko Widodo because it erodes the people’s right to choose leaders and gives more power to the opposition-controlled Parliament. This weighed on the rupiah and domestic bonds. Markets in Malaysia, Thailand and the Philippines saw virtually flat returns for the month.

1 The Consumer Price Index is a measure of the change in the weighted average prices of a basket of consumer goods and services, such as transportation, food and medical care.

 

Investment Policies

In order to achieve its investment objective, the Company may invest up to 80% of its total assets in "Asian-Pacific debt securities", and may be denominated in an Asian-Pacific Country currency or in Australian, New Zealand or U.S. dollars. At least 20% of the Company's total assets will be invested in "Australian debt securities".

The information contained above provides only a brief summary description of the Company's investment objective and investment policies. Please contact Investor Relations should you wish to receive more detailed information regarding the Company.

Taxation

Shareholders should consult with their tax advisors regarding the taxation of dividends received on shares of the Company and any disposition of shares of the Company. In general, dividends received by a Canadian resident holder of shares of the Company (including dividends reinvested in shares of the Company) must be included in computing the income of the holder for Canadian tax purposes. The gross-up and dividend tax credit rules applicable to dividends received from taxable Canadian corporations will not be applicable, as the Company is not a Canadian corporation.

Dividends

The Fund pays dividends monthly out of net investment income and realized capital gains, and to the extent necessary, paid in capital.

 
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