Specialist emerging markets asset manager Ashmore Group updated the market on its assets under management for its third quarter ended 31 March on Tuesday, reporting that assets under management increased $7bn during the period, with net inflows of $6.4bn and positive investment performance of $0.6bn.
The FTSE 250 company said continued investor demand for emerging markets assets delivered net inflows in each of the fixed income and equities investment themes during the quarter, resulting in the strongest quarter for gross and net flows since June 2013.
It said the flows continued to be broad-based by investor type, including significant top-ups from a range of clients.
Net flows were said to have been strongest in the local currency, blended debt and corporate debt themes, and also positive in equities, external debt and overlay/liquidity.
Ashmore said its active investment processes delivered positive investment performance, despite more volatile market conditions, particularly in February.
Local currency and blended debt portfolios delivered strong levels of absolute and relative performance, while the US dollar-denominated external debt and corporate debt themes performed in line with slightly lower market levels.
Performance in the equities theme was marginally negative overall, but with continued outperformance in the specialist products such as frontier markets.
“This quarter has seen particularly strong net inflows across the range of the group's products,” said Ashmore CEO Mark Coombs.
“Over the medium to longer term, positive investor sentiment towards emerging markets will continue to be supported by attractive valuations, the need for institutional investors to address underweight allocations, better earnings and credit fundamentals, and relative currency strength arising from further US dollar weakness.”
Coombs said that significantly, the increased market volatility experienced over the past three months had little effect on the fundamental drivers of returns in emerging markets and, as expected, both emerging markets fixed income and equity markets outperformed.
“Volatility that originates in the developed world typically leads to emerging markets assets being mispriced, presenting attractive investment opportunities for Ashmore with its specialist, active management approach and a focus on value.”