Allianz GI’s alternatives business doubles during ‘financial repression’

Allianz Global Investors has established a new division to manage its rapidly growing alternatives business.

The environment of “financial repression” has made alternative strategies more important than ever to investors, the company says.

The Allianz alternative group had €5.4bn (£ bn) in October, compared with just €2.1bn two years earlier.

With the creation of the new alternatives “pillar”, former alternatives strategy executive Spencer Rhodes will become global business manager for the division.

Rhodes joined Allianz in July last year from hedge fund firm Tradewinds Investment Management where he was business development manager and chief operating officer.

Rhodes says: “We have a great mix of alternative strategies. Some are long-running, peer-group leaders. Others are newer, highly-differentiated strategies with significant potential. I’m excited to be working with such a talented group of investors to deliver absolute return strategies for clients in today’s challenging market environment.”

Andreas Utermann, Allianz Global Investors co-head and global chief investment officer says the firm has been expanding its alternatives capability as investor demand grows.

Alternatives are now a “core part” of its active management proposition, he adds.

“These capabilities now cover a broad range of strategies, including: equity long/short, merger arbitrage, options trading, commodities, volatility, global macro, absolute return bonds, private debt, infrastructure debt, and infrastructure equity.

“In an environment of financial repression, characterised by much lower future expected returns from the beta element of all asset classes, these strategies can help investors capture alpha.”