Aberdeen's new high-yield bond fund gives diversified alternatives

By Toni Weeks

San Diego, March 22 - Aberdeen Asset Management Inc. said that the Feb. 28 launch of the Aberdeen U.S. High Yield Bond Fund is a continuation of the company's strategic initiative to deliver its core investment competencies to the U.S. retail and institutional markets.

According to a press release, the fund allows investors the opportunity to diversify their portfolios with access to high-yielding alternatives available in today's investing environment while providing exposure to Asian, developed and emerging markets.

"With few higher-yielding alternatives currently available, it's no surprise that there is such a strong demand for high-yield bonds," Aberdeen's head of U.S. High Yield Keith Bachman said in the release. "Spreads are well above where we would expect them to be, given the muted default outlook over the next few years, creating what we believe is an attractive entry point for investors."

In conjunction with the launch of the fund, Aberdeen has published the whitepaper, "Benefits of Long-term Allocation to U.S. High-yield Securities," which is available on the company's website (www.aberdeen-asset.us/aam.nsf/usretail/mutualfixedUSyield).

As previously reported, the fund seeks to maximize total return consisting of interest income and capital appreciation. It invests at least 80% of its net assets, plus any borrowings for investment purposes, in bonds of U.S. issuers that are rated below investment grade at the time of investment. The fund may invest up to 20% of its net assets in debt securities issued by foreign issuers or denominated in foreign currency, either of which may be from emerging market countries.

The fund is managed by Aberdeen's U.S. High Yield team, with portfolio managers Keith Bachman, Brendan Dillon, Christopher Gagnier, Edward Grant and Neil Moriarty responsible for the fund's day-to-day management.

Class A shares will carry a maximum sales charge of 4.25% of the offering price, while class C, class R, institutional class and institutional service class shares are not subject to a sales charge. Only class C shares will incur a deferred sales charge, which is 1% of the offering or sale price, whichever is less.

Philadelphia-based Aberdeen Asset Management Inc., the fund's investment adviser, has agreed to limit its operating expenses to 0.8% for all classes during the fund's first year. Consequently, the total annual fund operating expenses will be 1.1% for class A shares, 1.8% for class C shares, 1.35% for class R shares, 0.8% for institutional class shares and 0.85% for institutional service class shares.

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