Bond investing beyond duration

Maxence-Louis Mormede (CIO Advanced Fixed Income, Allianz Global Investors) outlines how bond investors can improve risk-adjusted outcomes by prioritising the information ratio over pure return-seeking.

• The information ratio measures excess return per unit of tracking error, helping investors target efficiency under tight risk budgets.

• A 0.5 information ratio is considered good, while 1.0+ is exceptional, highlighting consistency over volatility.

• Raising the ratio comes from diversifying independent active positions across sector, country, currency, quality and default risk—not just duration and curve views.

Explore the full note for practical examples and a toolkit to strengthen fixed-income risk budgeting.