AHL TargetClimate

AHL TargetClimate is an actively managed, multi-asset programme aligned with the global transition to a low-carbon economy.

Unlike typical ESG focused investments, AHL TargetClimate allocates to securities across multiple asset classes, including, equities, corporate bonds (including green bonds), governments and commodities
Benefits from AHL’s data driven security selection, triangulating over multiple environmental measures to build a climate integrated portfolio

Active risk management is applied in the spirit of AHL TargetRisk, using systematic techniques to quickly reduce investment risk in difficult markets, with the aim of reducing drawdowns

AHL TargetClimate (the ‘Programme’) is a risk managed, multi-asset Programme that aims to align with the global transition to a low-carbon economy. The Programme primarily trades a long only portfolio allocating to various asset classes including equities, corporate bonds, green bonds, government bonds, and commodities considered aligned with the green transition. A hedging futures portfolio is enacted from time to time to hedge investment risk in difficult markets.

We believe AHL is in a unique position to design and implement a climate integrated strategy across multiple asset classes. The key value proposition, in our opinion, is

Multi-asset approach. In the industry, it is typical for ESG assets to be focused solely on equities. AHL has been exploring new markets since its inception in 1987 and AHL TargetClimate applies climate principles across equities, credit, governments and commodities, with the potential to add more over time.
Data driven security selection. AHL benefits from Man Group’s highly advanced data science platform and centralised RI team to onboard and analyse ESG data. The goal is to select those securities most aligned with fighting climate change.
Active Risk management. AHL’s proprietary risk management framework aims to cut risk in difficult markets. The aim is to participate on the upside, while protecting on the downside. This approach has been implemented via our TargetRisk programme for many years, targeting an improved Sharpe ratio and reduction in drawdowns, as compared to a traditional equity/bond portfolio, such as the 60/40.

Systematic techniques, which are featured in other AHL products, are used to actively adapt risk exposures as appropriate for the market environment and to preserve capital during market sell-offs.

Style	Multi-strategy systematic
Investment Approach	Balanced allocation
Volatility Target⁺	7-10%

Russell Korgaonkar

CIO, Man AHL

Otto van Hemert, PhD

Director of Core Strategies, Man AHL

Can Systematic Investors Plead the Fifth on RI? October 2021

New tools can address the responsible investment challenges faced by systematic macro managers. Could we be heading for a future where systematic investing doesn’t compromise on ESG?

Harry Moore

ESG Investing March 2021

London Business School Professor Alex Edmans joined Yale Professor Nicholas Barberis, Harvard Professor Neil Shephard and Duke Professor Campbell R. Harvey, along with practitioners from across Man Group, to discuss ESG investing.

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ESG Investing: What Does the Research Say? December 2020

A look at what the research – both from academics and practitioners – says on ESG investing.

Stefano Piu

Man offers a comprehensive suite of investment solutions and formats that can be tailored and optimised to meet specific client needs. Our investment solutions offer optionality including: liquidity, control, investment restrictions, investor customisations and transparency.

UCITS

Alternative investment funds

US 40 ACT

Regional funds

Separate accounts

Advisory mandates

Managed accounts

Access to investment products and mandate solutions are subject applicable laws and regulations including selling restrictions and licensing requirements. Investment solutions listed above may not be compatible for all investment strategies and may be subject to minimum subscription requirements. Regional Funds: In additions to UCITS and AIFs registered across the EEA, a number of investment strategies are available in vehicles registered in Chile, Netherlands, Hong Kong, Japan, Singapore, South Korea and Switzerland.

View our strategies

+ The targets and limits illustrate the Investment Manager’s current intentions, and are subject to change without notice.

One should carefully consider the risks associated with investing, whether the strategy suits your investment requirements and whether you have sufficient resources to bear any losses which may result from an investment:

Investment Objective Risk - There is no guarantee that the Strategy will achieve its investment objective.

Market Risk - The Strategy is subject to normal market fluctuations and the risks associated with investing in international securities markets and therefore the value of your investment and the income from it may rise as well as fall and you may not get back the amount originally invested.

Counterparty Risk - The Strategy will be exposed to credit risk on counterparties with which it trades in relation to on-exchange traded instruments such as futures and options and where applicable, ‘over-the- counter’("OTC","non-exchange") transactions. OTC instruments may also be less liquid and are not afforded the same protections that may apply to participants trading instruments on an organised exchange.

Currency Risk - The value of investments designated in another currency may rise and fall due to exchange rate fluctuations. Adverse movements in currency exchange rates may result in a decrease in return and a loss of capital. It may not be possible or practicable to successfully hedge against the currency risk exposure in all circumstances.

Liquidity Risk - The Strategy may make investments or hold trading positions in markets that are volatile and which may become illiquid. Timely and cost efficient sale of trading positions can be impaired by decreased trading volume and/or increased price volatility..

Financial Derivatives - The Strategy will invest financial derivative instruments ("FDI") (instruments whose prices are dependent on one or more underlying asset) to achieve its investment objective. The use of FDI involves additional risks such as high sensitivity to price movements of the asset on which it is based. The extensive use of FDI may significantly multiply the gains or losses.

Leverage - The Strategy's use of FDI may result in increased leverage which may lead to significant losses.

Emerging Markets - The Strategy may invest a significant proportion of its assets in securities with exposure to emerging markets which involve additional risks relating to matters such as the illiquidity of securities and the potentially volatile nature of markets not typically associated with investing in other more established economies or markets.

Non-Investment Grade Securities - The Strategy may invest a significant proportion of its assets in non-investment grade securities (such as “high yield” securities) are considered higher risk investments that may cause income and principal losses for the Strategy. They are instruments which credit agencies have given a rating which indicates a higher risk of default. The market values for high yield bonds and other instruments tend to be volatile and they are less liquid than investment grade securities.

Total Return - Whilst the Strategy aims to provide capital growth, a positive return is not guaranteed over any time period and capital is in fact at risk.

Model and Data Risk - The Investment Manager relies on quantitative trading models and data supplied by third parties. If models or data prove to be incorrect or incomplete, the Strategy may be exposed to potential losses. Models can be affected by unforeseen market disruptions and/or government or regulatory intervention, leading to potential losses.

Commodity risk - The Strategy may have exposure to commodities, the value of which can be volatile may carry additional risk. Commodity prices can also be influenced by the prevailing political climate and government stability in commodity producing nations.