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Aberdeen's 1,400% man in Asia on why his heart isn't in passive

Bloomberg Published on Wed, Jun 28, 2017 / 12:35 PM GMT+8

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(June 28): Hugh Young understands the appeal of passive investing -- it’s one of the faster-growing offerings at his firm, Aberdeen Asset Management Plc. But that doesn’t mean he likes it.

“My heart isn’t in it,” says Young, who co-founded Aberdeen’s Asia business in 1992 and has trounced the region’s benchmark index with his flagship equity fund over the past three decades.

The 59-year-old stock picker’s faith in active management shows little sign of wavering despite one of the most challenging periods of his career. Assets in his flagship fund have dropped 67% from their 2013 peak amid a stretch of weak returns, while Aberdeen has suffered about US$85 billion ($117.9 billion) of net outflows in the past two years. The UK-based firm, which still has more than 90% of its assets in active strategies, agreed to merge with Standard Life Plc in March and cut 800 jobs across the group to weather growing competition from low-cost index funds.