Our Main Strategies

Fixed income investments have traditionally been the stable core of our investment portfolio. In addition to traditional funds, we offer a number of innovative overlay funds that focus on additional return and / or hedging of interest rate risk.

European ABS

• Higher risk-adjusted yield than most other fixed income asset classes
• Risk diversification through exposure to consumer risk
• Transparency allows for effective risk management

Asset Back Securities (ABS) bonds are securities backed by assets and hence secured with specific collateral. Investors can choose what specific collateral to invest in. The largest sectors per underlying asset type are residential mortgages, consumer loans, commercial mortgages and loans to corporations.

We have been investing in European ABS since 2001 and have one of the largest investment teams in Europe. The ABS strategy outperformed the benchmark in each year of the crisis. We analyze all ABS sectors to the last details and actively search for attractive opportunities in a broad range of sectors.

European Credits

• Experienced portfolio management team with strong track record
• Quadrant framework provides structured approach
• Extensive Aegon Global Research Platform

Idea generation is essential for creating optimal credit portfolios. We believe that thoroughly seeking out and analyzing investment ideas enables active portfolio management to add value for our customers. Our disciplined investment process in combination with in-depth credit analysis is key. Portfolio managers work closely with our Global Research Platform analysts, who provide them with an in-depth understanding of global credit markets. This cooperation is an essential element of our bottom-up decision making process.

Aegon Asset Management’s experienced and cohesive portfolio management team has a strong track record and an average of 15 years’ experience.

Emerging Market Debts

• Country selection is largest driver of return
• Track record of strong excess and risk-adjusted returns over the long term
• Experience in navigating business cycles and capitalizing on market dislocations

Emerging market portfolios are managed under a uniform investment philosophy based on three premises.

First, country selection is the largest driver of return. We analyze sovereign countries in the emerging markets universe. The dedicated sovereign research team is organized by region and conducts empirical analysis on, and develops proprietary forecasts of, each country’s economic and policy fundamentals, credit spreads, and monetary policy.

Second, we believe that asset prices deviate from fundamental value. Therefore, we conduct rigorous analysis on the interaction of fundamentals and asset price. Finally, asset prices over- and under-react to new information. We strive to tactically oscillate portfolio risk driven by our assessment of market sentiment. The investment process is built upon our time-tested investment beliefs.

Government Bonds

• Steady performance across cycles
• Flexibility in using different sources of alpha
• Structured decision making process

We believe bond markets are inefficient. They will over or undershoot fair value during both bull and bear phases. That is why we actively manage government bond portfolios, through a disciplined investment process.

The Quadrant framework is applied for all active positions, taking into account macroeconomic, valuation, qualitative and technical elements. This process leads to a portfolio with broad diversification of positions, using all relevant sources of alpha. Our strategy has outperformed the benchmark, the Merrill Lynch Core Eurozone Government Bond Index, for more than two decades.

Government Related Investments

• Invest in government-guaranteed private placements
• Higher return compensates for limited liquidity
• Focus on investments with high credit rating
• Focus on Impact Investments, target of at least 50% of assets

The strategy invests in a well-diversified mix of short-, medium- and long-term government guaranteed loans and bonds issued by supranationals. The large majority of the portfolio consists of private placements guaranteed by European public and semi-public institutions. Borrowing entities typically include social housing associations, hospitals, municipalities and regional authorities. The largest part is invested in Dutch private placements with a government guarantee.

The Government Related Investment strategy offers a significantly higher return than a portfolio of government bonds. This higher return compensates for the limited liquidity. The typical average rating of the portfolio is AAA and the interest rate risk is similar to that of government bond funds.

Global High Yield

• Improves the risk-return profile of a portfolio
• Strong historic track record
• Extensive Global Research Platform including Distressed Debt Specialists

We believe that bond markets are inefficient and deviate from fair value. Active management may take advantage of these inefficiencies during both bull and bear markets to achieve excess return. Key success factors to long-term outperformance are: recognition of asymmetrical risk in fixed income markets; importance of strong risk management; long-term perspective and consistent focus on delivering competitive risk-adjusted returns over economic cycles; and balancing top-down macroeconomic analysis with proprietary bottom-up research.

Aegon Asset Management has been managing high yield portfolios since the late 1980s and as such, we have weathered the portfolio through every phase of the investment cycle.

Dutch Residential Mortgages

• Attractive spread over swaps
• Attractive Return-on-Capital under Solvency II and Basel3, due to the low capital charge for mortgages
• Risk diversifier: exposure to consumer credit
• Strong fit with asset-liability framework of pension funds and insurers

Dutch residential mortgages offer an attractive yield relative to government bonds and corporate debt. Since the crisis, reduced competition in the Dutch mortgage market and increased bank regulation have resulted in high mortgage spread levels. Aegon is one of the leading providers of mortgages in the Netherlands.

New Aegon mortgage production is split between Aegon’s own balance sheet and external clients, via the pooled AeAM Dutch Mortgage Fund. This co-origination structure ensures alignment or interest. Most Dutch residential mortgages have a long fixed-rate term. The modified duration of the AeAM Dutch Mortgage Strategy is approximately 7.5 years. This long duration provides a strong fit with the liabilities of pension plans and life insurance companies. Although mortgages are illiquid, the strategy offers some liquidity via mortgage (p)repayment, and via matching of subscriptions and redemptions.

Global Listed Real Estate

• Invests in shares of listed real estate investment companies worldwide
• Listed real estate has a long-term relationship with GDP growth and inflation
• Strategy is to select stocks that combine quality portfolios, attractive valuation and value added management.

Aegon Asset Management offers tax efficient and diversified access to high quality real estate worldwide. The asset class offers attractive relative returns (vs worldwide equity) and regularly outperformed general equity markets since 1993.

Global listed real estate stocks combine a decent dividend return with growth that is linked to global GDP and inflation. In addition, the liquidity of listed real estate enables an active investment strategy. The fund thereby aims to add value by anticipating trends in the market while selecting quality management teams that are able to outperform in their submarket. We have been dedicated investors in listed real estate since 1990 and have a long track record.

Asset Backed Securities (ABS)

Three reasons why to invest in ABS

1. Enhance risk/return profile
2. Protection against rising interest rates
3. Consumer exposure

Suited for various types of investors

UCITS Fund Range

Find your information on the Aegon Asset Management Europe ICAV and its Irish UCITS fund range.