Standard Life launches EM funds

Standard Life Mutual Funds has launched two emerging market funds.

The first is called the Standard Life Emerging Markets Debt Fund. It offers capital growth and income since it invests in debt securities of issuers that are located or participating in emerging market countries.

“The emerging market U.S. dollar-denominated debt asset class allows investors to gain exposure to a diverse opportunity set of over 60 countries,” says Richard House, head of emerging markets fixed income at Standard Life Investments.

“Due to years of macro policymaking improvements, the credit quality of the asset class has continued to improve,” he adds. “On average, emerging market sovereign debt is now rated as investment grade, [so] adding emerging market debt to Canadian fixed income portfolios provides diversification benefits [and] potentially higher yield.”

Read: Should clients invest in emerging markets?

The second offering is called the Standard Life Emerging Markets Dividend Fund. It also provides capital growth and income, but invests in dividend-paying equity and equity-type securities of companies that are located or participating in emerging markets. The fund is also available in corporate class.

It’s key to “focus on both dividend growth and dividend sustainability…over the long term,” says Mark Vincent, investment director of Global Emerging Markets at Standard Life Investments. “[But] the choice is limited for Canadians wanting to invest in such opportunities.”

Read: Choose emerging over developed markets

Additional lineup changes

Along with opening the two new funds, Standard Life has decided to terminate its Canadian Equity Focus Fund and U.S. Equity Focus Fund, effective on or about July 31, 2014.

As of May 26, 2014, units of the two funds will no longer be available for new investments, including additional purchases by existing unit holders and through regular investment plans.

Existing unit holders of the two funds have the option to redeem or switch their investments to any Standard Life mutual funds before the termination date, and all sales charges and redemption fees (in connection with redemptions of units of the two funds) will be waived.

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