ANNPX: Top 3 Allianz Funds for Retirement Diversification
Allianz Global Investors is an investment manager that currently manages assets worth over 345 billion euros on a worldwide basis. The company has over 23 locations and over 500 investment professionals, which allows Allianz the scale it needs to service its sophisticated client base. The group offers many different investment products and services, such as mutual funds, closed-end funds, managed accounts, institutional services and 529 plan educational programs. With Allianz’s global outlook, it is no surprise the firm has amassed over 83 million customers spread across more than 70 countries.
Allianz GI Focused Growth Fund (PGWAX)
One of Allianz’s best-rated funds, its Focused Growth Fund is rated four stars by Morningstar. The fund seeks long-term capital appreciation by investing in companies with a market capitalization of at least $1 billion or more. Led by Scott Migliori, Karen Hiatt and David Jedlicka, the fund uses a disciplined approach to investing. The portfolio managers use a bottom-up approach and examine the fundamental strengths of each company within the fund. The managers use a specific screening process to select stocks with sustainable growth, reasonable valuation levels and superior cash flow. For an expense ratio of 1.11%, fund owners can expect anywhere from 25 to 45 of the managers' highest-conviction stock picks that are forecasted for growth.
From a performance standpoint, the fund excels in every area. On a 10-year average, the fund produced an average return of 8.66%, which is 2.2% higher than the S&P 500's return. In 2015, a year when the S&P 500 had a lackluster 1.38% total return, the fund produced a return of 10.03%. These stellar returns have also been at a similar risk to the benchmark, with the fund having a beta of 0.98 and an alpha of 2.38. Investors seeking a large-cap growth fund should look to the Focused Growth Fund from Allianz.
Allianz GI Best Styles Global Equity Fund (ALLGX)
One of the newer funds in the Allianz lineup, the Best Styles Global Equity fund looks to set itself apart through an actively managed investment process that looks to deliver above-average performance. The fund is run by the team of Klaus Teloeken, Michael Heldmann and Rainer Tafelmayer, all of whom are experienced in domestic and international markets. The team looks to give investors a diversified, risk-conscious, factor-based approach to its investment process. The fund gives investors a great value with a net expense ratio of 0.75%, as it can invest among any asset class on a global basis.
Since the fund was just launched in September 2014, there is not a significant amount of performance data to compare it to its peer group over a long-term basis. In its first full year in 2015, the fund was down -1.88%, which was far better than its benchmark, which was down -5.66%. Currently, management has 56% of the fund invested in North America, 15% in Europe and 8% in Japan. Its top holdings include major names like Apple, Johnson & Johnson and AT&T. With its unique investment philosophy that allows the fund to select the world's best investment opportunities, it should be poised for better than average long-term performance.
Allianz GI Convertible Fund (ANNPX)
Allianz Funds only has three traditional fixed-income funds in its lineup; the highest rated is the Convertible Fund. The fund's main focus is to provide investors with a maximum total return through combined capital appreciation and income. This convertible bond fund does this primarily through investing in U.S. corporate fixed-income securities that are convertible into stocks. The portfolio managers, Douglas Forsyth and Justin Kass, look to have positive long-term growth with a lower volatility similar to the bond markets. For an expense ratio of 0.66%, the fund looks to gain 70 to 80% of the underlying stocks' returns with considerably less downside exposure. This gives investors the potential to gain upside in a bull market yet offer a cushion against bear markets.
The fund is one of Allianz’s best rated, with a five-star rating from Morningstar. On a 10-year basis, the fund outperforms the benchmark by 1.43%, giving investors a total return average of 8.11%. Over the last year, the markets have begun to decline, but the fund maintained its risk-hedging ability by declining only -1.84% instead of the benchmark's -2.99%. Investors looking for a fixed-income fund with equity-like returns should look to the Allianz Convertible Fund.