Alternatives - Aberdeen Asset Management UK
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How we invest

  • Operating globally with offices in Europe, US and Asia, we provide clients with specialist access to a range of alternative and pan-alternative investment solutions
  • Adhering to a consistent philosophy and investment process first-hand research is at the centre of our approach
  • Investing in alternatives can offer a range of benefits including the potential for enhanced returns, reduced volatility and additional tail protection, in some cases

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Private equity

We think the private equity market continues to be attractive for investors and over the longer term, though not guaranteed, we believe it is likely to maintain its outperformance over more traditional asset classes. We maintain the view that there is significant opportunity for private equity to enhance value through effective operational and financial change, benefiting both portfolio companies and investors in the asset class. The team’s investment expertise spans multiple geographies, industry sectors, stages (including buyout, growth, private debt, distressed and venture) and strategies (including Primaries, Secondaries and Co-investments).

The combined team of over 40 investment professionals was formed through the merging of Aberdeen’s original private equity team, the Scottish Widows Investment Partnership Limited private equity team, Aberdeen SVG and FLAG Capital Management, LLC (“FLAG”). You can access the legacy Aberdeen SVG website here.

Our approach

As a premier global private equity investment provider, the team offers a range of investment solutions for a variety of portfolio objectives including:

  • Fund-of-Funds Vehicles
  • Customised Separately Managed Accounts
  • Listed Private Equity
  • Portfolio Monitoring
  • Investor Communication and Reporting Services

Hedge funds

Hedge funds represent a wide range of different strategies that invest in traditional asset classes, but in a non-traditional way. 

The types of risk/return profile available from hedge funds vary greatly.

To get the most out of a hedge fund allocation, investors need a deep understanding of the characteristics that a particular strategy will bring to an overall portfolio. This could be increasing or reducing overall risk, through styles that either act as substitutes for existing risk exposures, or diversifiers away from them.

Our approach

We have a long and successful track record of building multi-manager hedge fund portfolios.

 We do this through:

  • In-depth and propriety strategy research & manager selection
  • Dedicated operational due diligence and risk assessment
  • Specialist portfolio construction teams and systems

Infrastructure

Infrastructure investment offers the potential for attractive risk-adjusted returns; reliable inflation-linked returns; stable long-term yields and capital growth.

There are also the added benefits of defensive characteristics emanating from the provision of essential services and potential value enhancement through active asset management.

The current uncertainty in the economic environment highlights the benefits that such investment can bring to an investor’s portfolio.

Our approach

In addition to being able to provide clients with exposure to third party infrastructure investments via our private markets multi-manager capabilities, we have a specialist direct infrastructure group focused on greenfield infrastructure projects that are underpinned by long-term government contracts.

The direct infrastructure team has a long, established track record and operates out of our offices in London, Edinburgh, Paris, Madrid and Sydney.

Pan alternatives

  • Combines the experience of our strategy specialist teams to meet the bespoke needs of individual clients (e.g. real returns)
  • Includes allocations to liquid and illiquid markets
  • Provides flexibility

Quantitative investments

In some situations, a sophisticated efficient capture of market returns is the most important objective for an investor.

Our Quantitative Investment team manages a range of products to satisfy a variety of requirements:

Traditional indexation:

  • Passive strategies that target the return of a traditional market capitalisation benchmark, such as the FTSE All Share Index
  • Our pragmatic replication approach manages the costs of replication as well as the matching of benchmark return in an optimal, scalable, repeatable and risk-controlled process

 Fundamental indexation:

  • Strategies that seek to provide consistent exposure to a fundamental index, rather than a market capitalisation index
  • In particular we manage a range of strategies linked to the FTSE RAFI™ family of indices, providing exposure to the UK, Global and Emerging Markets respectively

 Enhanced index:

  • Aim to exploit market inefficiencies to generate small excess returns relative to the benchmark, for a similar level of risk.
  • Taking an index as the starting point, our investment process models equity strategies such as value, prudent management, financial strength, trend and others, to identify a strong investment rationale or theme that in back testing, has demonstrated outperformance over a business cycle
  • It then combines these proprietary strategies to tilt the portfolio according to the identified theme targeting a consistent risk-adjusted relative return

We also manage a range of bespoke derivative and structured products.

Multi-manager property

Property provides the potential for a range of benefits from income, growth, value add through active management and development, with a real asset underpin.

However, it requires large investment amounts and resource-intensive management to access directly; trying to invest directly on a global basis can also introduce legal and tax complexity.

As a result, many investors prefer to invest via funds and funds of funds, to best capture the breadth of opportunities available.

A multi-manager approach, in particular, can provide investors with access to high quality property funds and managers, offering exposure to any or all of debt and equity, prime and secondary locations, domestic, regional and global investments, and operating assets or developments.

Our approach

Underpinned by three pillars:

  • Running a quality investment process that is simple, robust and focused on risk management and transparency
  • Providing quality investment solutions for our clients, including a range of commingled funds
  • Seeking quality, best-in-class managers to drive long-term returns

Latest alternatives insights

Risk warning:

Risk warning

The value of investments and the income from them can go down as well as up and investors may get back less than the amount invested.

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