Before implementing active interest rate and credit strategies, a set of technical factors is considered. These focus on short-term market dynamics and on improving the timing of decision-making:
Taking market technique into account is not to generate ideas per se, but rather is understood as a final review before implementing active investment strategies based on fundamentals versus valuation.
We are convinced that not only proprietary research, but also portfolio implementation should be linked to portfolio management. This offers clear advantages:
Risk management takes place at various levels. On the one hand, risk management is an integral part of the investment process of the management team. On the other hand, risk management is carried out independently of portfolio management.
The portfolio management team tracks portfolio risks ex ante and ex post using advanced portfolio management systems and models. In addition, our approach to risk management is pragmatic, not dogmatic. Accordingly, we consider stress tests and scenarios as well as common sense and experience to be essential. More concretely, our risk management includes the following aspects:
Thanks to our systems, we are able to monitor and control all important aspects of risk, such as interest rate risk, credit risk and currency risk in real time, both in absolute terms and against a benchmark.
Due to the high granularity of the data available to us, we have a very good overview of the different sources of risk, which enables us to improve our risk management.
Furthermore, our independent risk management department ensures that investment guidelines are adhered to and regularly conducts comprehensive performance and risk reviews and analyses.