A Comprehensive Solution
Allianz Global Investors Solutions Core Allocation Fund is a “fund of funds” that can serve as a diversified portfolio solution for investors looking to balance capital appreciation potential with current income as a portion of their investable assets. Taking a moderate stance, the Fund targets a strategic allocation of 65% of total assets to return-generating assets and 35% to defensive assets. However, its managers have some flexibility to diverge from this balance in order to actively take advantage of certain market opportunities.
Emphasis on Diversifying Risk
During periods of severe market stress, asset classes such as U.S. and international stocks tend to be highly correlated (i.e., move closely in tandem), making them less effective diversification tools. The Core Allocation Fund seeks to moderate overall portfolio volatility by diversifying risks rather than asset classes. It does this by dividing assets into two distinct risk categories: 1) return-generating assets that emphasize real (inflation-adjusted) wealth accumulation, and 2) defensive assets designed to preserve principal and provide real income.
Broader Investment Universe
Unlike many traditional allocation funds that invest largely in U.S. stocks and bond funds, the Core Allocation Fund extends its universe to include a range of other assets. These include funds investing in: international and emerging markets investments; real return (inflation-hedging) assets such as Treasury Inflation-Protected Securities (TIPS), commodities and real estate; and alternative assets such as listed private equity and infrastructure. These are drawn largely from the extensive range of Allianz and PIMCO mutual funds, and a portion may be drawn from selective third-party exchange-traded funds (ETFs) and other mutual funds and pooled vehicles.
Pre-eminent Global Asset Management
Allianz Global Investors Solutions, a registered investment advisor, serves as the sub-advisor for the Core Allocation Fund. The underlying mutual funds provide access to the expertise of the Allianz Global Investors investment firms —PIMCO, NFJ Investment Group, RCM, Nicholas-Applegate Capital Management, Oppenheimer Capital and Cadence Capital Management1— which are among the most established and forward-looking in the industry. Each firm maintains its own distinctive investment culture and philosophy, providing investors with convenient access to a breadth of proven strategies, styles and approaches. Allianz Global Investors’ investment firms have more than $1 trillion in assets under management for our clients worldwide.2
1 Cadence Capital Management is an independently-owned investment firm.
2 Allianz Global Investors AG assets under management as of December 31, 2008.
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