Insurers Embrace U.S. High Dividend Equity Strategies
February 27, 2014
Insurers Embrace U.S. High Dividend Equity Strategies
Insurers Seek Investment Income and Enhanced Portfolio Diversification
HARTFORD, CT – February 27, 2014 – Conning, a leading investment management company for the global insurance industry, is seeing significant interest from large and mid-sized insurers in U.S. high-dividend equity strategies as they seek to diversify their investment portfolios while preserving investment income.
“Insurers are under pressure to maintain adequate levels of investment income, but are concerned about the potential impact of expected increases in bond yields on portfolio values. As a result, they are seeking opportunities to diversify their portfolios by increasing exposure to equities, alternatives and non-traditional assets that can provide attractive levels of current income,” said Michael Haylon, Managing Director and Head of Investment Products at Conning. “Conning’s U.S. high dividend equity strategy focuses on companies with strong balance sheets in sectors that will allow them to maintain their dividend payouts in periods of economic uncertainty and increase dividends as the economy strengthens.”
Conning said its U.S. high dividend equity strategy produced net returns of 37.97% and 19.11% over the past one and three years respectively, with the three-year returns outperforming the S&P 500 by 2.94% on an annualized basis. This strategy has delivered annual growth in dividends of 10% since inception in 2010. According to Conning, the benefits of its high-dividend equity strategy include:
• After-tax dividend yields that are currently attractive relative to yields on fixed-income instruments
• Tax savings for certain insurance companies due to the dividends-received deduction
• Potential for dividend increases and capital appreciation
Conning (www.conning.com) is a leading investment management company for the global insurance industry, with almost $83 billion in assets under management as of December 31, 2013 through Conning, Inc., Conning Asset Management Limited, Cathay Conning Asset Management Limited, and Goodwin Capital Advisers, Inc. The company's unique combination of asset management, risk and capital management solutions and insurance research helps clients achieve their financial goals through customized business and investment strategies. Founded in 1912, Conning is focused on the future, providing clients with innovative solutions, leveraging its global capabilities, investment experience, and proprietary research. The company is headquartered in Hartford, Connecticut, with additional offices in Purchase, London, Cologne, and Hong Kong.
Conning offers a broad spectrum of core and non-core fixed-income strategies to insurers globally. Additionally, the company offers a range of investment strategies in non-traditional and alternative asset classes that can enhance risk-adjusted returns and portfolio diversification while addressing investors’ unique investment and risk management constraints. These strategies include trade finance, master limited partnerships, liquid alternatives, hedge fund replication strategies, among other solutions.
This material is for informational purposes only and should not be interpreted as an offer to sell, or a solicitation or recommendation of an offer to buy any security, product or service, or retain Conning for investment advisory services. This information is not intended to be nor should it be used as investment advice and should not be copied or distributed without the prior consent of Conning.
Conning, Inc. and Goodwin Capital Advisers, Inc. are registered with the Securities Exchange Commission (“SEC”) under the Investment Advisers Act of 1940. Conning, Inc. is also registered with the Ontario Securities Commission. Conning Asset Management Limited is authorized and regulated by the United Kingdom’s Financial Conduct Authority. Cathay Conning Asset Management Limited is regulated by Hong Kong’s Securities and Futures Commission. Conning primarily provides asset management services for third-party assets. Conning predominantly invests client portfolios in fixed income strategies in accordance with guidelines supplied by its institutional clients.
A client’s actual account value will fluctuate and losses can occur. Most portfolios in this strategy reinvest dividends as part of a quarterly re-balancing program.
The net of fee performance provided was calculated using the highest investment fee incurred by the portfolios in the composite to reduce gross of fee performance. Conning's fees are described in Part 2 of our Form ADV.
The benchmark shown is the S&P 500 Index. Due to the specific investment approach of this strategy, no benchmark could be determined to provide an effective comparison for performance purposes; the benchmark is shown as a reference for the equity market.
Past Performance is not indicative of future returns. Any tax-related information is for informational purposes only and should not be considered tax advice. You should consult a tax professional with any questions.
To receive a complete list and description of Conning composites and/or a presentation that adheres to the GIPS standards, contact Odette Morin at 860-299-2340 or email@example.com.