allianz global artificial intelligence · source: allianz global investors, as at september 2017....

Allianz Global Artificial Intelligence

Q4 2017 Issue

Artificial Intelligence isOur Future

• Access the long-term potential of the rapidly growing artificial intelligence market

• Gain exposure to companies which are exposed or connected to the evolution of artificial intelligence

• Benefit from active management by an experienced investment team

Allianz Q7580_Allianz Global Artificial Intelligence Leaflet_030118 v5.indd 1 1/3/2018 12:24:36 PM


Why invest in Allianz Global Artificial Intelligence (“the Fund”)?• Artificial Intelligence (AI) is likely to be one of the largest drivers of innovation across different industries.

• The Fund aims at long-term capital growth by investing in the global equity markets of companies whose business will benefit from/or is currently related to the evolution of AI.

AI could be the most disruptive technology of the 21st century• AI is set to drive the next significant wave of innovation

and automation. Just as some companies disrupted the retail and media industries, we are seeing advances in AI drive major transformation in areas such as transportation, finance, healthcare, manufacturing, and others.

• The potential benefits from AI have led some people to compare its advancement to the next industrial revolution. AI has the potential to disrupt business models, and change how we work and live.

AI is our future, AI is now?• AI i s part of everyday l i fe now. The technologica l

underpinnings of AI are developing rapidly, with seemingly new breakthroughs everyday. We are now training machines to see, hear, navigate, and interact with the environment around them.

• It is important to understand that much of what today’s AI is achieving is behind the scenes or merely the start of the journey. These technologies are fueling advances such as self-driving cars, improved medical diagnostics, and advances in factory automation to name just a few.

The vast opportunity in today’s fast changing world• The amount of data created in the past two years is greater than

the total amount created in the history of humankind.

• The widespread use of AI-enabled technologies could double the economic growth rates of many advanced countries by 2035*. AI is predicted to drive global Gross Domestic Product (GDP) gains of US$15.7 trillion by 2030#.

The Four stages of the Industrial Revolution

1st Industrial Revolution • Introduction of mecha-

nical production sites based on water and steam power

• First mechanical loom (1784)

2nd Industrial Revolution• Introduction of mass pro-

duction based on division of labour and electricity

• Assembly line, meat-packing sites in Cincinnati (1870)

3rd Industrial Revolution• Further automation

of production throughuse of modern electronics and IT

• First programmable cont-rol, Modicon 084 (1969)

4th Industrial Revolution• Based on cyber-physical

systems• "Deep Leaning"

End of 18th century Beginning of 20th century

Beginning of the 1970s

Today

Com

plex

ity

16

14

12

10

8

6

4

2

02017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Labour Productivity Personalisation Time Saved Quality

US$

trill

ion

Labour productivity improvements are expected

to be over 55% of all GDP gains from AI over the

period 2017-2030.

58% of all GDP gains in 2030 will

come from consumption side

Global GDP Impact by Effect of AI (estimated)#

Source: Allianz Global Investors, as at October 2017.

* Source: Accenture and Frontier Economics, as at May 2017.# Source: PricewaterhouseCoopers, as at June 2017.Past performance, or any prediction, projection or forecast, is not indicative of future performance.

Source: Bitcom, as at October 2016.

8:00Easier and safer transportationSelf-driving cars will take the most optimal route and get you to your destination on time.

22:00 A virtual doctor to keep you healthyAI monitors your sleeping patterns, heart rate etc., and notifies your doctor if needed.

11:00 Manage your smart home while you are awayAI robot cleans your place while you are away and turns on the lights, air-con before you arrive.

7:00Your intelligent personal assistantAI will manage your busy schedule – wake you up, let you know today’s weather.

15:00 Watch your favourite TV shows whenever you wantAI knows your preferences and automatically records your personal entertainment.

17:00 No need to worry about planning dinnerAI will give you food suggestions – knowing what’s in the refrigerator and arrange ordering & delivery

19:00 Conversation with friends from all over the worldAI automatically translates languages in real time for better communication.

AI in our Everyday Life


Source: Allianz Global Investors, as at September 2017.†GrassrootsSM Research is a division of Allianz Global Investors that commissions investigative research for asset-management professionals. Research data used to generate GrassrootsSM Research reports are received from reporters and field force investigators who work as independent, third party research providers, supplying research that is paid for by commissions generated by trades executed on behalf of clients.

Fund Features1. Pioneer in the AI fieldThe Fund is the first AI fund in Europe that seeks to capture the potential benefits of this fast-growing market.

AI is a foundational technology being used by more companies every day, and we believe the impacts will be profound.

The market for AI is at an earlier stage of development, so greater focus is currently on growth companies whose business will benefit from/or is currently related to the evolution of AI.

2. Actively managed, disciplined approachThe Fund is a focused, global equity fund that invests in innovative companies leveraging AI potential across various industries. We believe that bottom-up, fundamental analysis is key to understanding the companies best positioned to benefit from this disruptive technology.

With a consistent and disciplined stock selection process and prudent risk control, the Fund aims to construct a well-diversified portfolio that invests in the global equity market of companies that will benefit from or is currently related to the evolution of AI.

3. Experienced and connected investment teamThe investment team has decades of experience covering the technology sector and deep relationships across Silicon Valley. The team also leverages on over 60 fundamental sector analysts located across the globe to identify innovative companies.

It is also supported by GrassrootsSM Research†, a division which combines 10 in-house employees and a global network of over 300 independent, experienced journalists and field force researchers. This division provides tailored research that allows the investment team to obtain information more quickly and accurately than the market.

Global Sector Fundamental Research

Analysts across Europe, Asia and the Americas

Source: Allianz Global Investors, as at December 2017.There is no guarantee that these investment strategies and processes will be effective under all market conditions and investors should evaluate their ability to invest for the long-term based on their individual risk profiles especially during periods of downturn in the market.

IntelligentAutomation Cognitive Systems Deep Learning

Robotics Social Machine Vision

Advertising Aero- space

Agri- culture

Auto- motive

Education Energy Finance

Legal Media Manu-facturing

Retail Tech-nology

Trans-portation

HealthCare

AI-Enabled Industries

Big Data Cloud

Internet of Things Mobile

AI Applications

AI Infrastructure

Global Equities Universe

> 1,000innovative companies

Screening & Analysis through

Proprietary Research Platform and

by Fund Manager

Sebastian Thomas, CFALead Portfolio Manager

Software & Internet

Catherine McCarthyResearch Analyst

US Media & Telecom

Stephen McDonald, CFAResearch Analyst

IT Services

James Chen, CFACo-Portfolio Manager

Semiconductors

Stephen JueSenior Research Analyst

Hardware & Communications

Based on Fundamental

Research

Risk Control, Monitoring and Review

Based on Risk / Reward

Analysis

Stock Selectionapprox.150-200

Portfolio Construction

approx.40-100 holdings

Investment Team

Source: Competitor Report by Luminam, as at February 2017.


Investment hotline: +65 6438 0828 sg.allianzgi.com

Top 10 Holdings (Country)

Fund Details

Sector Allocation (%)

Country Allocation (%)

Sector %MICRON TECHNOLOGY INC (US) IT 5.9TESLA INC (US) CONS. DISC. 5.1SQUARE INC - A (US) IT 4.7SPLUNK INC (US) IT 4.7SALESFORCE.COM INC (US) IT 4.2BAIDU INC - SPON ADR (CN) IT 3.6YELP INC (US) IT 3.5BROADCOM LTD (US) IT 3.0ON SEMICONDUCTOR CORP (US) IT 2.9NVIDIA CORP (US) IT 2.8Total 40.4


Fund Highlights

Share Class Class AT (USD) Acc. Class AT (EUR) Acc. Class AT (H2-SGD) Acc.# Class A (EUR) Dis.Fund Manager Sebastian ThomasFund Size1 USD 144.36mBase Currency USDInitial Fee Up to 5%All-in-Fee2 2.05% p.a. 2.05% p.a. 2.05% p.a. 2.05% p.a.Total Expense Ratio3 N/A N/A N/A N/AUnit NAV USD 11.95 EUR 108.25 N/A EUR 107.13Inception Date 31/03/2017 02/05/2017 08/12/2017 31/08/2017Dividend Frequency4 N/A N/A N/A AnnuallyISIN Code LU1548497426 LU1548497699 LU1720051017 LU1548497186Bloomberg Ticker ALGAATU LX ALGAAT LX AGATH2S LX ALGAIA LX

Source: All fund data quoted are Allianz Global Investors/IDS GmbH, as at 30 November 2017, unless stated otherwise.Fund performance is calculated in the respective fund currency on a NAV-to-NAV basis with gross dividends re-invested. Investment returns are denominated in the respective base currency. SGD based investors are exposed to non-SGD foreign exchange fluctuations.1 The Fund Size quoted includes all classes of the Fund.2 The All-in-Fee includes the expenses previously called management and administration fees.3 Total Expense Ratio (TER): Total cost (except transaction costs) charged to the Fund during the last financial year expressed as a ratio

of the Fund's average NAV. For share classes that have been incepted for less than one year as at close of the last financial year (please refer to the Inception Date in the Fund Details table), the TER will be annualised. For share classes incepted after the close of the last financial year, the TER will be reflected as N/A.

4 Dividend payments are applicable for Class A Dis (annual distribution) and for reference only. Yields are not guaranted, dividend may be paid out from capital (Class A). This may result in an immediate decrease in the NAV per share and may reduce the capital available for the Fund for future investment and capital growth. Positive distribution yield does not imply positive return.

# This share class is only available for sale with effect from 8 December 2017. Information herein is based on sources we believe to be accurate and reliable as at the date it was made. We reserve the right to

revise any information herein at any time without notice. No offer or solicitation to buy or sell securities and no investment advice or recommendation is made herein. In making investment decisions, investors should not rely solely on this material but should seek independent professional advice. However, if you choose not to seek professional advice, you should consider the suitability of the product for yourself. Past performance of the fund manager(s) and the fund is not indicative of future performance. Prices of units in the Fund and the income from them, if any, may fall as well as rise and cannot be guaranteed. Distribution payments of the Fund, where applicable, may at the sole discretion of the Manager, be made out of either income and/or net capital gains or capital of the Fund. As a result, it may reduce the Fund’s net asset value. The dividend yields and payouts are not guaranteed and might change depending on the market conditions or at the Manager’s discretion. Investment involves risks including the possible loss of principal amount invested and risks associated with investment in emerging and less developed markets. The Fund may invest in financial derivative instruments and/or structured products and be subject to various risks (including counterparty, liquidity, credit and market risks etc.). Past performance, or any prediction, projection or forecast, is not indicative of future performance. Investors should read the Prospectus obtainable from Allianz Global Investors Singapore Limited or any of its appointed distributors for further details including the risk factors, before investing. This material has not been reviewed by the Monetary Authority of Singapore (MAS). MAS authorization/recognition is not a recommendation or endorsement. The issuer of this material is Allianz Global Investors Singapore Limited (12 Marina View, #13-02 Asia Square Tower 2, Singapore 018961, Company Registration No. 199907169Z).

IT 74.2

UNITED STATES 81.7

LIQUIDITY 8.6

CONS. DISC. 10.2

LIQUIDITY 8.6

OTHERS 0.8JAPAN 0.4KOREA 0.9CHINA 3.6

FRANCE 4.0

FINANCIALS 2.0HEALTHCARE 1.8

INDUSTRIALS 1.8REAL ESTATE 0.6OTHERS 0.8


allianz global artificial intelligence · source: allianz global investors, as at september 2017....

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