Professional Documents
Culture Documents
60 Years of
Experience
Performance through smart risk
taking
March 2017
Agenda
1 tradition 6 Capabilities
2 Capabilities 7
Our Asian Fixed Income Target Maturity Funds
3 Capabilities 8
Our European Fixed Income Swing Pricing
4 Capabilities
9
Our Emerging Market Debt
5 Capabilities
2
1
A Deep-rooted Fixed Income
Tradition
3
An Identity Shaped by
our Allianz Culture
1 Insurer financial strength rating from S&P: AA, from Allianz Fact Sheet, 16/02/2017
2 Source : Allianz Fact Sheet. Data as of 16/02/2017
3 Source: Allianz Global Investors, as at 31/12/2016. Fixed income numbers including money market 4
Regional Focus and Global Reach:
Our Key to Success
Franck Dixmier - Global Head of Fixed Income, CIO Fixed Income Europe
5
Allianz Global Investors Fixed Income Capabilities
Long Tradition and Selective Innovation
1957 1971 1979 1990 1992 1999 2008 2010 2012 2013 2015
Treaty of Rome End of Bretton Oil Crisis German Black Creation of Global Financial EU-IMF bailout ECB plegdes to do US Fed Greek Crisis
Establishing the European Woods standard reunification Wednesday the Euro Crisis and package for 'whatever it takes' Tapering
Economic Community attack on British Quantitative Greece to save euro
(EEC) Pound Easing
AllianzGI has successfully expanded its fixed income capabilities over multiple market cycles
Allianz Global Investors (AllianzGI) refers to the predecessor companies at that time. The corporate names differ. Source: Allianz Global Investors. 6
Allianz Global Investors Fixed Income Capabilities
Long Tradition and Selective Innovation
Allianz Global Investors (AllianzGI) refers to the predecessor companies at that time. The corporate names differ. Source: Allianz Global Investors. 7
Selected Funds
Allianz Advanced Fixed Income Short Duration Short duration Euro bond fund with broad investment universe
Allianz Enhanced Short Term Euro Fund for ultra short-term EUR bonds enhanced by fixed-income and FX investments
Asia
Allianz Flexi Asia Bond Fund for Asian bonds denominated in local currencies or international reserve currencies
Allianz Renminbi Fixed Income Fund for deposits and bonds denominated in Renminbi
8
Selected Funds
Europe
Allianz Flexible Bond Strategy Bond fund focusing on Europe with highly flexible duration policy
Allianz Euro Bond Fund EUR bond fund with medium duration and expanded investment range
Allianz Euro Investment Grade Bond Strategy Fund for investment-grade bonds from the Eurozone
Allianz Emerging Markets Bond Fund Fund for emerging market bonds (largely EUR-hedged)
Allianz Emerging Markets Bond Extra 2018 Fixed maturity fund focusing on emerging markets bonds
Allianz Emerging Markets Short Duration Defensive Bond Fund for emerging markets bonds with short duration
9
Selected Funds
Allianz Income and Growth1 Fund for high-yield bonds, convertible bonds and equities from the U.S. (with supplemental
option strategy)
Allianz US High Yield Fund for high-yield corporate bonds from the U.S.
1 Allianz Income and Growth combines high yield, convertibles and equities and is managed by the US Fixed Income team 10
The Role of Performance & Portfolio Risk
Our stewardship role enables us to promote strong, sustainable
investment performance.
We UNDERSTAND We ACT
the risk-return payoff structure of our 1. Share our analytics and meet with PMs on
an ongoing basis, challenging them to stay
investment strategies
active and outperform consistently.
through our proprietary analytics and 2. Generate actionable insights for CIOs
comprehensive portfolio reviews through our quarterly performance reviews.
from the vantage point of being 3. Enhance our tools and analytics continuously
globally embedded into the investment in order to support new investment ideas or
platform strategies.
11
Quarterly Performance Reviews
A well-established portfolio review framework, feeding back into the
investment process
Performance & Portfolio Risk lead the Reviews, in
Quarterly Performance partnership with the CIOs, and in the interim provide
Reviews ongoing advice to PMs
*These steps represent a generic investment process, which may differ by investment strategy. 12
Portfolio Analytics
Integrated and client-centric approach to analyzing active returns
and risks*
Return Risk-
Return
Risk 4. Client-Centric: Can we enhance clients risk-
Payoff return payoff through a broader opportunity set?
*Quarterly, Monthly and Weekly analytics reports are produced independently by IDS GmbH (separate subsidiary of Allianz SE), using a selection of computational models, e.g. APT, Wilshire. 13
2
Our Advanced Fixed Income
Capabilities
14
Regional Focus and Global Reach:
Our Advanced Fixed Income Capabilities
Franck Dixmier
Global Head of Fixed Income
CIO Fixed Income Europe
Taking Advantage of Global Fixed Income Market Inefficiencies While Keeping Risks Under Control
16
Advanced Fixed Income
Investment Process
1 2 3 4
Portfolio construction according to
Research Market analysis Trading
individual investor requirements
Risk
AllianzGI Active Positioning Process Active Management
Management
Advanced
Monetary Covered/Sec 1. Universe analysis
Analytics policy uritized
State of the art
methods for
Risk decomposition
scientific market Yield curve Bank bonds
Liquidity analysis Implementation
analysis
Duration
Corporate Contribution to the
bonds 2. Fund positioning TE/VaR
selection of
Allocation: DVaR/CVaR1,2
Market High yield - Safe Spreads Risk individual securities
Volatility
bonds - Tactical Allocation Optimisation
Insight
Exchange Inflation
Currencies Selection:
GPC/E&S/Regional linked bonds
FI Units - Security selection
Emerging - Primary markets
Swaps
countries
Risk Controlling
A performance of the strategy is not guaranteed and losses remain possible.
1 DVaR stands for Dynamic Value at Risk; CVaR stands for Conditional Value at Risk
2 Benchmark & Risk constraints are determined by the ALM Manager 17
The Advanced Fixed Income investment process
Global coverage for tailored optimized risk-adjusted portfolios
Investors
Investors specific
Advanced Analytics Active
optimized guidelines and
Positioning
portfolio risk/return profile*
Trading
Desk
Structured research through Unconstrained positioning Takes into account all investors
proprietary tools guidelines
Taking into account all risk
Blend of Top-Down/Bottom-up dimensions Order execution via Trading Desk
Global coverage Monthly and ad-hoc review Optimized risk-adjusted returns
AFI Global Allocation Team AFI Global Selection Team AFI Global SCF* Team
All members of the Advanced Fixed Income Team have a risk management and or multi asset background.
As of 01.06.2016.
* SCF: Securitized, Covered & Financials. 19
Advanced Fixed Income
Global reach for individualised solutions
Aggregate
Sovereign
Universe
Covered /
Securitized
IG
Corporates
Emerging
Markets
This map represents the countries covered under the sovereign risk analysis.
AFI offers a truly global coverage across all asset classes and market segments.
A performance of the strategy is not guaranteed and losses remain possible. Source: AllianzGI Advanced Fixed Income Team, as of 01.08.2016. 20
Advanced Fixed Income
Global Sovereign Issuers
Example: Romania
Debt Sustainability RE-Rating Sovereign Strength Indicator
We perform a variety of analysis of the In 2013 our RE-Rating analy-sis Within the SSI we analyse the
dynamics of sovereing debt. showed that the previous downgrade is fundamental, governance and political
not justified by fundamentals, rather we strength.
For example, one analysis shows that
ex-pected the country rating to be lifted
despite its current budget balance of - Romania ranks amongst its European
to IG (e.g. BBB-).
2.3%, Romania could go as far as - peers in as far as our fundamental
10.4% and still meet the Maastricht On May 16th 2014 S&P announced its strength indicator is concerned.
criteria within three years time. first IG rating to Romania since almost
The total SSI score even outpaces
six years.
most peripheral countries.
By combining the results of the analysis above, the Advanced Fixed Income was able to invest with confidence into
Romanian government bonds.
Source: Allianz Global Investors, as at 15 May 2014. This is no recommendation or solicitation to buy or sell any particular security. A security mentioned as example above will not necessarily
be comprised in the portfolio by the time this document is disclosed or at any other subsequent date. This is for guidance only and not indicative of future allocation. 21
3
Our Asian Fixed Income Capabilities
22
Regional Focus and Global Reach:
Our Asia Pacific Fixed Income Capabilities
Franck Dixmier
Global Head of Fixed Income
CIO Fixed Income Europe
We offer a range of products to meet individual clients risk and return objectives
24
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
Track record
4 Proven track record of delivering consistent outperformance in this
asset class with a relatively low level of volatility.
25
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
Investment Team
David Tan
CIO, Fixed Income, Asia Pacific
24 years experience
Regional Asia-Pacific Bonds (SG) China/ Hong Kong Bonds (HK) Taiwan Bonds (Taipei) Product Specialist (SG)
Mark Tay Yoke Sei Tan Helen Lam Grace Lin Dianna Enlund
Head of Fixed Head of Credit Head of Hong Kong Head of Taiwan Fixed Senior Product
Income, Singapore Research, Asia Fixed Income Income Specialist
21 yrs experience Pacific 22 yrs experience 19 yrs experience
19 yrs experience
26 yrs experience
Client requirements
Active strategies
and risk using
Duration independently
Conviction generated
Macroeconomics Yield curve reports from IDS
Portfolio
Market Views
Risk Management
Source: Allianz Global Investors. The information provided above is used to demonstrate our investment approach. It is not a recommendation or advice to buy or sell.
There is no guarantee that these investment strategies and processes will be effective under all market conditions and investors should evaluate their ability to invest for a long-term based on their 27
individual risk profile especially during periods of downturn in the market.
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
David Tan
Chief Investment Officer, Fixed Income Asia Pacific
Active portfolio management: utilizes a dynamic allocation approach to capture opportunities during different market cycles rather than
being constrained by benchmark weights
Disciplined investment process with a systematic approach to top-down strategies
Fundamental credit analysis to identify attractively-valued bonds. Focus on issuers that exhibit stable or improving balance sheets,
sound business models, access to funding and good liquidity levels.
Dynamic, broad, unrestricted diversification across countries and sectors
Risk and performance analysis is actively incorporated in the investment process to validate views and strategies, ensuring portfolio
positions add value
Flexible, dynamic allocation approach to capitalize on Asian fixed income opportunities during different
market cycles rather than being constrained by benchmark weights.
Strong growth and Slow growth and low Recession and Recovery and low
high inflation inflation deflation inflation
Economic Growth
Time Horizon
Instrument type
Mark Tay
Head of Fixed Income, Singapore
The strategy seeks to provide income and long-term capital appreciation by investing primarily in Asian high yield credits with dynamic
hedging to reduce downside risks
Active approach focused on fundamentally-driven, bottom-up security selection
Flexibility to diversify into non-benchmark, unrated or CNH-denominated issues for additional sources of value-add
Top-down active management of portfolio downside risks
Ex-post risk measurement and performance analysis serve as validation of ex-ante risk measurements and investment strategies
Capture yield pick-up offered by Asian high yield bonds whilst actively managing downside risks.
Source: Allianz Global Investors. The above is for illustrative purposes only and is not a recommendation or advice to buy or sell.
There is no guarantee that these investment strategies and processes will be effective under all market conditions and investors should evaluate their ability to invest for a long-term based on their 31
individual risk profile, especially during periods of downturn in the market.
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
1 Past performance is not a reliable indicator of future results. 2 This is not a recommendation or solicitation to buy or sell the above-mentioned security. 3 The bond mentioned as an example
above may not necessarily be held in our portfolios.
Source: Bloomberg Finance L.P., Allianz Global Investors, as at 30 December 2016. 32
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
Garreth Ong
Portfolio Manager
The strategy aims to generate yield pick-up whilst managing drawdown risks to achieve consistency and stability of income
Fundamental bottom-up driven credit selection approach to identify attractively-valued bonds
Invest only in investment grade credits to ensure high quality portfolio
Tactical top-down macro strategies may be implemented to minimize drawdowns relating to interest rate and credit risk
Risk and performance analysis is actively incorporated in the investment process to validate views and strategies, ensuring portfolio
positions add value
Offers yield-up from an investment grade only portfolio that actively manages portfolio drawdown risks
90 Filter Criteria
2016-7-28 2016-8-05 2016-8-16 2016-9-16 2016-10-14 2016-11-30
Expected Return: 4.00% coupon as a stable carry play
Key data as at: 30 December 2016 Enable investors to benefit from the economic growth story of India and
stay within a defensive sector
ISIN: XS1391575161
Risks
Yield / Price: 4.73% / 94.48
Exposure to financially weak state-owned electricity distribution
Currency: USD companies
Bond rating: Moodys: Baa3, S&P: BBB-, Fitchs: BBB- Short operating track record
Aggressive expansion plans may increase capital expenditure
1 Past performance is not a reliable indicator of future results. 2 This is not a recommendation or solicitation to buy or sell the above-mentioned security. 3 The bond mentioned as an example
above may not necessarily be held in our portfolios.
Source: Bloomberg Finance L.P., Allianz Global Investors, as at 30 December 2016. 34
Flexi Asia Bond Dynamic Asian High Dynamic Investment China Strategic Bond Offshore RMB Fixed
Yield Bond Grade Bond Income
Renminbi Strategies
Two products providing access to opportunities in China bond market
Renminbi Strategies
Investment Process
1 3 4
Top-down analysis Portfolio Construction Risk Management
Helen Lam
Head of Hong Kong Fixed Income
The funds objective is to provide investors a combination of long-term capital growth and income with yield enhancement opportunities
Flexibility to invest across various types of China fixed income opportunities including, USD bonds, CNH (offshore RMB) bonds and
CNY (onshore RMB) bonds
Decision to invest in CNH and/or CNY denominated bonds will be from a total return perspective
Combination of China USD and RMB bonds provides optimal return and diversification with manageable volatility and favorable risk
return profile
Credit selection focuses on quality and strategically-important China credits
Provides access to the broad range of China fixed income opportunities including offshore and onshore bonds
Currency
Exposures Flexibility to invest in USD- or RMB-
denominated bonds
Interest
Rate
Exposures Target duration profile to benefit most
on risk-adjusted basis based on the
current economic cycle
Credit
Exposures
Integrate credit fundamental with
valuation in security selection
Helen Lam
Head of Hong Kong Fixed Income
Fundamental credit analysis to identify attractively-valued bonds. Focus on issuers that exhibit stable or improving balance sheets,
sound business models, access to funding and good liquidity levels
Focuses on a high quality portfolio to minimize credit risks
Active portfolio management with a strong emphasis on diversification and minimizing volatility
Strong focus on liquidity risks and management
Prudent risk control with regular portfolio stress testing analysis
Focuses on a high quality portfolio to generate consistent outperformance while minimizing risk
Franck Dixmier
Global Head of Fixed Income
CIO Fixed Income Europe
In-depth Analysis
1 Market risk
Liquidity risk
Issuer risk
Counterparty risk
Downside risk: avoid heavy downgrades and default
Portfolio Management
2 Continuous Plausibility Checks
Full transparency of risk metrics
Thorough Due Diligence
1 IDS = IDS GmbH, analysis and reporting services, 100% subsidiary of Allianz SE; PRC = Portfolio Risk Controlling 42
Conviction Fixed Income Corporate Credit
Executive Council
European framework/guidance
for Fixed Income Strategies
based on fundamental inputs
Judgmental approach making full use of a large opportunity set to best exploit key macro trends
44
Conviction Fixed Income Corporate Credit
1 2 3
Key Macro Trend Analysis Active Management Portfolio construction
Country allocation
Covered bonds
Staying ahead of the curve: focus on our expectations vs. market consensus
45 45
Conviction Fixed Income Corporate Credit
Monica Zani (23/23) Franck Mugat (17/17) Yassine Oussana (14/13) Ali Ozenici (13/11)
Dedicated
Massimiliano Maxia (19/15) Jan Simon King (11/2)
Product Specialists
Numbers in brackets reflect years of industry experience/years at Allianz Global Investors and associated companies. Data as of December 2016. 46
1 Liability-Driven Investment
Conviction Fixed Income Corporate Credit
LDI1
Global Unhedged
Global Hedged
Absolute Return
Money Markets
Duration band
- 4Y 0 10Y+
1LDI : Liability-Driven Investment.
A performance of the strategy is not guaranteed and losses remain possible. Source: Allianz Global Investors; data as of December 2016. 47
Conviction Fixed Income Corporate Credit
Yield curve
strategies are an
important source of
alpha
Corporate Credit
Characteristics
Corporate Credit
Investment Process
We focus on bond picking through bottom-up approach and adjust the credit exposure tactically
50
Conviction Fixed Income Corporate Credit
Portfolio managers
A. Caminade, CFA1 (24/12)
CIO Credit Europe
A. Caminade, CFA1
V. Marioni (18/2) G. Docq, CFA1 (9/1) L. Talavera (15/8)2 F. Piechowski (10/2)2 H. Dejonghe (16/5)2
(24/12)
High Yield Xover Investment Grade Investment Grade Investment Grade SRI
High Yield
J. Bras, CFA1 (12/11)2 T. Gruet, CFA1 (19/11)2 D. Guichard (16/3)
SRI Convertibles Private Debt
Dedicated analysts
D. Manoux (26/5)
Head of Credit Research
D. Manoux (26/5)
A-X. Fougerat (17/5) S. Iem, CFA1 (9/5) L. Desbrosses, CFA1 (8/3) E. Daull (10/3) M. Pacquelet (1/1)
Head of High Yield
Corporates Corporates Corporates Private Debt Private Debt
Research
C. Brugre (24/1)
A. Tixier (1/1) S. Outin, CFA1 (8/3) B. de la Roncire (17/4) H. Guergouri (13/9) J. Gasser (2/2)
Head of Investment
Private debt Financials Corporates Financials Convertibles
Grade Research
Source : Allianz Global Investors as of September 2016. Numbers in brackets reflect years of industry experience/years at Allianz Global Investors and affiliates.
1 Chartered Financial Analyst
2 Portfolio Managers contributing to Investment Grade Credit Research 51
Conviction Fixed Income Corporate Credit
Corporate Credit
Strategies
Investment Grade High Yield
Euro Investment Grade
Green Bond
Euro High Yield
Defensive1
Private Debt
Credit opportunities
Credit rating
Corporate Credit
Investment Example: Snam SpA
FY2014 results
Sales up 1% and Ebitda down 1%, net debt went up 330M after a
dividend payment of 500M. FCF before dividends back to positive in the
absence of equity investments.
Forecast
Most of SNAM activity is regulated and has a very limited exposure to
volume variation. Ebitda margin should stay stable in the next few years Investment analysis
at a high level (75%). This is enough to cover the Capex but not enough
for the generous payment of dividends. This means credit ratios won't Bond issued as per January 15th, 2014 / coupon 3,25% / maturity
improve materially but should remain at current levels. The rating of 10 years (01/22/2024)
SNAM is capped by the Sovereign (stable outlook at Moodys and S&P's) Rated Baa1 by Moodys / BBB+ by S&P
and cannot be more than one notch above Italys rating. We are closely PM bought on Primary market the day it was issued at a price of
monitoring the acquisitive strategy of SNAM for which we have a stable 99,02
fundamental credit opinion. Evolution of the price (Cf. graph): from 99 up to 117 today
Evolution of the spread: from 122bp down to 72 today
Performance: +21%
We still hold the bond today
Source: Allianz Global Investors, as at March 2015. This is no recommendation or solicitation to buy or sell any particular security. A security mentioned as example above will not necessarily
be comprised in the portfolio by the time this document is disclosed or at any other subsequent date. This is for guidance only and not indicative of future allocation. 53
5
Our Emerging Market Debt
Capabilities
54
Regional Focus and Global Reach:
Our Emerging Market Debt Capabilities
Franck Dixmier
Global Head of Fixed Income
CIO Fixed Income Europe
Active Conviction Portfolio Based on a Matrix Approach and a Decentralized Specialized Team
Dynamic management of investment opportunities, unique scanning of all segments to unlock value
Proactive risk budgeting and risk management
Transparency and liquidity : Provide clients with thorough understanding of portfolio composition (point in time and forward looking)
The senior managers in the team combine over 50 years of collective experience in EMD, High Yield and Global Credit
International team with local presence, performing fund management around the clock
Maximizing Emerging Market returns from inefficient and often mispriced investments in Sovereigns,
Corporates, local rates and FX
Source: Allianz Global Investors; data as at 31/05/2015.
56
Emerging Market Debt
Investment Process
Higher Lower
Market Market
Sovereign/ Risk Risk
Top down Quasi-
Sovereign
Global Factors Sovereign
Portfolio
Sovereign view Corporate Credit Optimisation
Arbitrage Momentum
Corporate
Bottom up
Local Currency Credit
EM Macro
57
Emerging Market Debt
Portfolio Management Team
Numbers in brackets reflect years of industry experience/years at AllianzGI and affiliates. Data as of March 2015. Source: Allianz Global Investors. 58
Emerging Market Debt
One Process, three Approaches
Allianz Emerging Markets Allianz Emerging Markets Short Allianz Emerging Markets
Fund
Bond Fund Duration Defensive Bond Bond Extra 2018
Source: JPMorgan, Allianz Global Investors, as at March 2015. This is no recommendation or solicitation to buy or sell any particular security. A security mentioned as example above will not
necessarily be comprised in the portfolio by the time this document is disclosed or at any other subsequent date. This is for guidance only and not indicative of future allocation. 60
6
Our US Income and Growth
Capabilities
61
US Income and Growth Capabilities
Douglas G. Forsyth
CIO Income and
Growth Strategies
62
US Income and Growth Strategies
Portfolio Management Team
William (Brit) L. Stickney (17/28) Justin M. Kass, CFA1 (16/20) Michael E. Yee (22/24)
Portfolio Management / Portfolio Management / Portfolio Management /
Research / Trading Research / Trading Research / Trading
David J. Oberto (9/15) David A. Foster, CFA1 (9/21) Joanna H. Willars (11/17)
Ethan Turner, CFA1 (4/11) Nicole Larrabee Rodrigues Matthew John (10/14)
(16/21)
Dedicated Research/Trading Research / Trading Research / Trading
Analysts and
Christopher L. Jackson (3/3) Michael W. Memory, CIPM2 Karen Chen, CFA (1/20)
product specialists
Research/Trading (17/17)
Senior Product Specialist Senior Product Specialist
Corey J. Kilcourse, CIMA3 (11/11) Jayme M. DiRienzo (4/8)
Product Specialist Product Specialist Associate
1 Chartered Financial Analyst , 2 Certificate in Investment Performance Measurement, 3 Certified Investment Management Analyst
Doug Forsyth and Michael Yee are the portfolio managers of the Allianz Income and Growth. Numbers in parentheses reflect years of tenure at Allianz Global Investors and affiliates/years of
industry experience. 63
Source: Allianz Global Investors; as at December 2016.
Our US Income and Growth Expertise
64
US Income and Growth Strategies
Investment Process
1 2 3 4 5
Idea Company Upgrade Alert Relative Value and Monitor and Risk
Generation Summary Sheet Model Trading Management
65
7
Selected Funds Highlights
66
Short duration Euro bond fund with broad investment universe
Duration 2 Months
3 Months
0.11
0.39
Jlichmanns, Ralf 6 Months -0.01
Experience since 1996 1 Year 0.78
Manages the fund Since inception 6.90
since 01/2013 Since inception p.a. 1.62
2015 0.62
The investment policy is geared towards generating 2016 0.84
an above-average long-term return compared to the
Fund Benchmark
European market for short duration bonds
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
Fund for convertible bonds focusing on Europe
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 0.00 %) reduce the capital employed and the performance stated. All performance data in respect of Allianz Convertible Bond - IT - EUR prior to the launch date,
31/01/2012, are based on another investment fund, namely ALLIANZ EUROPE CONVERTIBLE, a French benchmark fund, which is not licensed for distribution in Germany. Allianz Convertible Bond is managed by the same team
using the same strategy. This does not imply that Allianz Convertible Bond will enjoy similar performance in the future. The fund unit price may be subject to increased volatility 2 TER (Total Expense Ratio): Total cost (except
transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
Fixed maturity fund focusing on emerging markets bonds
2020 2 Months
3 Months
1.87
2.67
Saichin, Greg 6 Months 1.89
Experience since 1984
1 Year 10.28
Manages the fund Since inception 12.68
since 01/2015 Since inception p.a. 5.88
2015 -
The fund concentrates on bonds of public and private 2016 9.14
issuers from emerging market countries or companies that
generate the predominant share of their revenues in the Fund
emerging markets. The investment objective is to attain a
return in-line with yields of corporate and government
bonds with comparable maturity from the Emerging Portfolio characteristics Facts and figures
Markets.
Emerging market ISIN LU1113941998 A (EUR)
Min. 80 %
exposure Bloomberg-Ticker AEMB20A LX
Key features Non investment grade Max. 40% (at time of Reuters-Ticker ALLIANZGI01
Balanced combination of corporate bonds bonds acquisition) Benchmark No Benchmark
The fund invests both in emerging market investment grade Exclusion of certain kind Launch Date 27/01/2015
No MBS, no ABS
corporate bonds (up to 60%) and in emerging market high of bonds
Net Assets 173.23 million EUR
yield corporate bonds (max. 40%). This combination aims to Max. 10% of the sub-
Distribution payout on
provide above-average yield while maintaining a manageable FX exposure fund's assets from a 4.25 EUR
15/12/2016
level of risk. Euro perspective
TER (%) 2 1.04
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. The fund unit price may be subject to increased volatility 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
Fund for emerging markets bonds with short duration
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
Fund for ultra short-term EUR bonds enhanced by fixed-income and FX investments
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. Front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. You should not make any assumptions on the future on the basis of performance information in this document. The value of an investment and the income from it can fall as well as rise as a result of market
and currency fluctuations and you may not get back the amount originally invested. Any front-end loads reduce the capital employed and the performance stated. 2 TER (Total Expense Ratio): Total cost (except transaction costs)
charged to the fund during the last fiscal year (abridged fiscal year). 3 Perf.-related Fee:: Distribution verse au 15/12/2016
EUR bond fund with medium duration and expanded investment range
Key features
Invests primarily in Euro-denominated investment-grade Portfolio characteristics Facts and figures
bonds
High, but not specific ISIN LU0165915991 I (EUR)
Target tracking error
number Bloomberg-Ticker ALEUBIX LX
Total return approach Reuters-Ticker ALLIANZGI01
Diversification : out-of-benchmark strategies: Target performance
vs. Benchmark Bloomberg Barclays
- Foreign government bonds (non-European) Management style Active Benchmark 2 Capital Euro-Aggregate
Bond Index
Duration +/- 2 Jahre
- High Yield Launch Date 23/04/2003
Active sector exposure: Net Assets 676.66 million EUR
Max. 10 %
- Currencies High yield
Max. 20 % Distribution payout on
Emerging markets 0.198 EUR
- Emerging Markets Max. 20 % 15/12/2016
FX exposures
Max. 49 % TER (%) 3 0.72
Cash
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 2.00 %) reduce the capital employed and the performance. 2 Benchmark history: until 09/03/2009 Merrill Lynch Euro High Yield Constrained Unhedged EUR 3 TER
(Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
Fund for investment-grade bonds from the eurozone
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 2.50 %) reduce the capital employed and the performance. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last
fiscal year (abridged fiscal year).
Fund for Asian bonds denominated in local currencies or international reserve currencies
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 0.00 %) reduce the capital employed and the performance. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last
fiscal year (abridged fiscal year).
Bond fund focusing on Europe with highly flexible duration policy
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 0.00 %) reduce the capital employed and the performance. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last
fiscal year (abridged fiscal year).
Euro bond fund with medium duration
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 2.50 %) reduce the capital employed and the performance. 2 TER (Total Expense Ratio): Total cost (except transaction costs) charged to the fund during the last
fiscal year (abridged fiscal year).
Fund for high-yield corporate bonds from the U.S.
Key features
Disciplined, fundamental bottom-up research process
Portfolio characteristics Facts and figures
The process facilitates the early identification of High Yield
Target tracking error 2-4 % ISIN LU0516398475 IT (USD)
issuers demonstrating their ability to improve their fundamental
characteristics. The companies/issues selected for the 2 % over full market Bloomberg-Ticker AUSHYIT LX
Target outperformance
portfolio exceed minimum credit statistics and exhibit the cycle Reuters-Ticker ALLIANZGI01
highest visibility of future expected operating performance. Target number of Merrill Lynch US High
100-140
Maximization of information flow securities Benchmark Yield Master II Index
Allocation is the result of USD
Strategy is predicted on maximizing information flow to identify
Active industry the bottom-up process; Launch Date 02/08/2010
and minimize credit risk, avoid defaults and target upgrades.
exposure monitor industry / sector Net Assets 4,333.01 million EUR
Attractive investment weights relative to index
Accumulation on
The portfolio is designed to provide income, Active stock exposure 95-100 % 84.743 USD
30/09/2016
diversification benefits and total return potential. Alpha sources Security selection TER (%) 2 0.74
Stable team and strong leadership since inception
Senior members working together for more than 12 years.
Data as at 28/02/2017. 1 Calculated at the net asset value, excl. front-end load, distributions reinvested. Calculation according to method as defined by BVI, the German Fund Companies Association. Past performance is not a reliable
indicator of future results. Any front-end loads (for this fund currently 0.00 %) reduce the capital employed and the performance. The fund unit price may be subject to increased volatility 2 TER (Total Expense Ratio): Total cost (except
transaction costs) charged to the fund during the last fiscal year (abridged fiscal year).
8
Target Maturity Funds
80
Target Maturity Funds
An Attractive Combination of Predictability and Diversification
The funds aim to provide an highly attractive risk-return profile within the framework of a target maturity concept
1 The target yield can not be guaranteed and is influenced by several factors . Especially factors such as currency developments, FX hedging costs or returns, interest rate levels over the
term of the fund and at fund maturity, reinvestment opportunities of matured or called securities or coupon earnings, cap stock activity of the fund, securities defaults, changes in credit
spreads (yield premiums compared with top-rated debtors), etc., can influence the redemption amount on the maturity date and/or the return of the fund. 81
Striking Arguments for the Target Maturity Funds of Allianz Global
Investors:
01 02 03 04
Careful security Clearly defined Annual Reliability
selection offers maturity date distribution thanks to
chance of more The target maturity All target maturity funds professional risk
attractive funds will mature in the will make their management
4th quarter distributions in July
returns
82
The Target Maturity Funds of Allianz Global Investors
Advantages of a large
Advantages of a bond + universe + Advantages of a fund
Allianz
Rendite Plus 2017
1 TER (Total Expense Ratio): total expenses (excluding transaction costs) charged to the fund during the past financial year. 0.81%; as of 30/06/2016. A performance of the strategy is not
guaranteed and losses remain possible. Please note the additional information about the fund on www. allianzglobalinvestors.com 84
A Broad Range of Target Maturity Funds which Offer Solutions for
Every Need
The current range makes sure that a suitable solution is always available depending on preferences, the
focus may be on traditional or thematic aspects
Distributions
Minimum Redemption price on Performance1
2013, 2014 , 2015, 2016, Performance1 since
Fund name distribution, in 30/09/2016, since launch, p.a.,
in EUR in EUR in Eur in Eur launch, in %
EUR in EUR in %
Allianz Laufzeitfonds Extra 2017 2.50 New 2.50 2.50 2.50 103.29 10.89 2.70
3.25
Allianz High Yield Bond Extra 2017 3.70 New (abridged 3.70 1.72 94.70 5.40 1.46
FY)
0.96
Allianz Rendite Plus 2017
2.20 New (abridged 2.20 2.20 97.80 4.28 1.32
(launch 22.10.2013)
FY)
Current
Allianz Laufzeitfonds Extra 2019 New in
indication: 0 2.20 2.20 98.51 4.03 1.76
(launch 23.09.2014) 2014
2.20
1An annual fee for custodian services may weigh on the performance. Past performance is no reliable indicator of future results. The value of the fund units may be subject to highly elevated
volatility. As of 31/12/2016 2 The distributions are no indication of the actual returns of the fund. Source: Allianz Global Investors. 86
Deinvestment fee
87
Spotlight:
Callable Bonds (1/2)
Although callable bonds have a fixed term, they can be redeemed by the issuer before the maturity date.
Redemption is attractive for the issuer when market interest rates drop and/or when its credit rating improves. In
this situation, the issuer can obtain refinancing at a lower cost by paying off the bond and issuing another bond at a
lower interest rate.
1 Notes: Returns paid at maturity are referred to as yield to maturity. Returns paid upon the earliest possible call date are referred to as yield to call. The lower of the two is the yield to
worst. 88
Spotlight:
Callable Bonds (2/2)
Example
89
9
Swing Pricing
90
Swing Pricing
Swing pricing means that the fund unit price is adjusted for large net subscriptions or redemptions.
Thanks to this procedure, transaction costs are only borne by those who cause them.
Swing pricing protects the other investors from capital dilution.
Emerging European
Euro High
Markets Convertible
Yield
Debt Bonds
91
Implementation of Swing Pricing within Allianz Global Investors
Swing Pricing
A simple and transparent method :
The swing pricing factor
The NAV of the fund is adapted according to the volume and Add Swing Pricing Substract Swing
type of transactions on a given day. Transaction costs are Factor Pricing Factor
charged only to investors who subscribed or redeemed capital on
that day. The adaptation (swing pricing factor) is based on NAV
normal transaction costs for the underlying securities. (Always only one NAV)
92
Swing Pricing Threshold Mechanism in Practice
Subscriptions of EUR 5 m
1 Redemptions of EUR 5.5 m No swing pricing applied No swing pricing applied
= Net redemptions of EUR 0.5 m
< 1.5% net fund volume
Subscriptions of EUR 15 m
Redemptions of EUR 13 m
2 No swing pricing applied Swing pricing applied
= Net subscriptions of EUR 2 m
> 1.5% net fund volume and < 3% net fund volume
Subscriptions of EUR 20 m
3 Redemptions of EUR 10 m
Swing pricing applied Swing pricing applied
= Net subscriptions of EUR 10 m
> 3% net fund volume
93
Advantages for Clients
94
Disclaimer
Investing involves risk. The value of an investment and the income from it may fall as well as rise and investors might not get back the full amount invested.
Investing in fixed income instruments may expose investors to various risks, including but not limited to creditworthiness, interest rate, liquidity and restricted
flexibility risks. Changes to the economic environment and market conditions may affect these risks, resulting in an adverse effect to the value of the
investment. During periods of rising nominal interest rates, the values of fixed income instruments (including short positions with respect to fixed income
instruments) are generally expected to decline. Conversely, during periods of declining interest rates, the values of these instruments are generally expected
to rise. Liquidity risk may possibly delay or prevent account withdrawals or redemptions
The volatility of fund unit prices may be increased or even strongly increased. Past performance is not a reliable indicator of future results. If the currency in
which the past performance is displayed differs from the currency of the country in which the investor resides, then the investor should be aware that due to
the exchange rate fluctuations the performance shown may be higher or lower if converted into the investors local currency. This is for information only and
not to be construed as a solicitation or an invitation to make an offer, to conclude a contract, or to buy or sell any securities. The products or securities
described herein may not be available for sale in all jurisdictions or to certain categories of investors. This is for distribution only as permitted by applicable
law and in particular not available to residents and/or nationals of the USA. The investment opportunities described herein do not take into account the
specific investment objectives, financial situation, knowledge, experience or specific needs of any particular person and are not guaranteed. The views and
opinions expressed herein, which are subject to change without notice, are those of the issuer companies at the time of publication. The data used is
derived from various sources, and assumed to be correct and reliable, but it has not been independently verified; its accuracy or completeness is not
guaranteed and no liability is assumed for any direct or consequential losses arising from its use, unless caused by gross negligence or wilful misconduct.
The conditions of any underlying offer or contract that may have been, or will be, made or concluded, shall prevail. For a free copy of the sales prospectus,
incorporation documents, daily fund prices, key investor information, latest annual and semi-annual financial reports, contact the management company at
the address indicated below or www.allianzgi-regulatory.eu. Please read these documents, which are solely binding, carefully before investing. This is a
marketing communication issued by Allianz Global Investors GmbH, www.allianzgi.com, an investment company with limited liability, incorporated in
Germany, with its registered office at Bockenheimer Landstrasse 42-44, 60323 Frankfurt/M, registered with the local court Frankfurt/M under HRB 9340,
authorised by Bundesanstalt fr Finanzdienstleistungsaufsicht (www.bafin.de). The duplication, publication, or transmission of the contents, irrespective of
the form, is not permitted.