What is Buy and Maintain?
Our Buy and Maintain credit strategy is a customised global credit approach, designed to deliver the income required by institutional investors to match their cash flow needs whilst minimising the risks and inefficiencies of traditional benchmarked strategies. The strategy aims to deliver the yield modelled at the outset of portfolio construction over the lifetime of the strategy, with minimal turnover and hence transaction costs. Active portfolio management is still critical to success however, particularly with regards to avoiding deteriorating credits.
Strategy benefits
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Process and risk management
Our process is a combination of disciplined application of portfolio construction rules, high conviction selection and active risk management approach.
Our team of experts has always adhered to several tenets which suit the Buy and Maintain style:
- Avoidance of defaults and other negative “credit events”
- Emphasis on diversification at sector and issuer level
- Benchmark-aware, not constrained
Our proprietary Credit Watch Model is a key to this process. Since implementation in 1999, the model has helped the team successfully avoid all defaults, downgrades and distress situations in the global investment grade credit market.1
Buy and Maintain is managed within the overall global credit process, rather than in isolation. Where decisions are taken in our traditional active credit portfolios, the same information will be considered in respect of our Buy and Maintain portfolios.
Team
Our Buy and Maintain strategy is managed by our Global Fixed Income team within which credit forms one of the cornerstones. The team is a talented, experienced and well-resourced group of professionals led by Malie Conway, CIO of Global Fixed Income, and is supported by dedicated fixed income research resources.
The team forms part of the Allianz Global Investors global investment platform, within which ideas, comments and data are shared (including proxy voting updates, stewardship updates and discussions on company developments).
What other strategies are available? |
1. Data as at 20/12/2018
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. Past performance is not a reliable indicator of future results. 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.
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 für Finanzdienstleistungsaufsicht (www.bafin.de). Allianz Global Investors GmbH has established a branch in the United Kingdom, Allianz Global Investors GmbH, UK branch, 199 Bishopsgate, London, EC2M 3TY, www.allianzglobalinvestors.co.uk, which is subject to limited regulation by the Financial Conduct Authority (www.fca.org.uk). Details about the extent of our regulation by the Financial Conduct Authority are available from us on request.