DWS Concept Kaldemorgen April 2016 Confidential. Marketing Material. For Professional Clients (MiFID Directive 2004/39/EC Annex II) only. Not for retail distribution. As at the date of this document, the Fund described herein has not been notified or registered in accordance with the Undertakings for Collective Investment in Transferable Securities Directive 2009/65/EC for marketing to investors in Ireland However, such notification or registration may be made in the future. Therefore, this document may only be transmitted to an investor in Ireland at such investor’s own initiative.
Transcript
DWS Concept KaldemorgenApril 2016
Confidential. Marketing Material. For Professional Clients (MiFID Directive 2004/39/EC Annex II) only. Not for retail
distribution.
As at the date of this document, the Fund described herein has not been notified or registered in accordance with the Undertakings for Collective Investment in Transferable Securities Directive 2009/65/EC for marketing to investors in Ireland However, such notification or registration may be made in the future. Therefore, this document may only be transmitted to an
investor in Ireland at such investor’s own initiative.
Deutsche Asset Management
Issued and approved by Deutsche Bank AG London Branch, Winchester House, 1 Great Winchester Street, London EC2N 2DB. Deutsche Bank AG is authorised under German Banking Law (competent authority: European Central Bank) and, in the United Kingdom, by the Prudential Regulation Authority. It is subject to supervision by the European Central Bank and by BaFin, Germany’s Federal Financial Supervisory Authority, and is subject to limited regulation in the United Kingdom by the Prudential Regulation Authority and Financial Conduct Authority. Deutsche Bank AG is a joint stock corporation with limited liability incorporated in the Federal Republic of Germany, Local Court of Frankfurt am Main, HRB No. 30 000; Branch Registration in England and Wales BR000005 and Registered Address: Winchester House, 1 Great Winchester Street, London EC2N 2DB.
Deutsche Asset Management is the brand name for the asset and wealth management arm of Deutsche Bank AG.
This document is a “non-retail communication” within the meaning of the FCA's Rules and is directed only at persons satisfying the FCA’s client categorisation criteria for an eligible counterparty or a professional client. This document is not intended for and should not be relied upon by a retail client. This document may not be reproduced or circulated without written consent of the issuer.
This document is intended for discussion purposes only and does not create any legally binding obligations on the part of Deutsche Bank AG and/or its affiliates (“DB”). Without limitation, this document does not constitute an offer, an invitation to offer or a recommendation to enter into any transaction. It does not constitute investment advice or a recommendation or an offer or solicitation and is not the basis for any contract to purchase or sell any security or other instrument, or for DB to enter into or arrange any type of transaction as a consequence of any information contained herein. The information contained in this document is based on material we believe to be reliable; however, we do not represent that it is accurate, current, complete, or error free. Assumptions, estimates and opinions contained in this document constitute our judgment as of the date of the document and are subject to change without notice. Past performance is not a guarantee of future results. Any forecasts provided herein are based upon our opinion of the market as at this date and are subject to change, dependent on future changes in the market. Any prediction, projection or forecast on the economy, stock market, bond market or the economic trends of the markets is not necessarily indicative of the future or likely performance. Investments are subject to risks, including possible loss of principal amount invested.
When making an investment decision, potential investors should rely solely on the final documentation relating to the investment or service and not the information contained herein. The investments or services mentioned herein may not be appropriate for all investors and before entering into any transaction you should take steps to ensure that you fully understand the transaction and have made an independent assessment of the appropriateness of the transaction in the light of your own objectives and circumstances, including the possible risks and benefits of entering into such transaction. You should also consider seeking advice from your own advisers in making this assessment. If you decide to enter into a transaction with us you do so in reliance on your own judgment.
Certain Deutsche Asset & Wealth Management products and services may not be available in every region or country for legal or other reasons, and information about these products or services is not directed to those investors residing or located in any such region or country.
DB SPECIFICALLY DISCLAIMS ALL LIABILITY FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL OR OTHER LOSSES OR DAMAGES INCLUDING LOSS OF PROFITS INCURRED BY YOU OR ANY THIRD PARTY THAT MAY ARISE FROM ANY RELIANCE ON THIS DOCUMENT OR FOR THE RELIABILITY, ACCURACY, COMPLETENESS OR TIMELINESS THEREOF.
Investments are subject to investment risk, including market fluctuations, regulatory change, possible delays in repayment and loss of income and principal invested. The value of investments can fall as well as rise and you might not get back the amount originally invested at any point in time.
Investments in Foreign Countries - Such investments may be in countries that prove to be politically or economically unstable. Furthermore, in the case of investments in foreign securities or other assets, any fluctuations in currency exchange rates will affect the value of the investments and any restrictions imposed to prevent capital flight may make it difficult or impossible to exchange or repatriate foreign currency.
Foreign Exchange/Currency - Such transactions involve multiple risks, including currency risk and settlement risk. Economic or financial instability, lack of timely or reliable financial information or unfavourable political or legal developments may substantially and permanently alter the conditions, terms, marketability or price of a foreign currency. Profits and losses in transactions in foreign exchange will also be affected by fluctuations in currency where there is a need to convert the product's denomination(s) to another currency. Time zone differences may cause several hours to elapse between a payment being made in one currency and an offsetting payment in another currency. Relevant movements in currencies during the settlement period may seriously erode potential profits or significantly increase any losses.
High Yield Fixed Income Securities - Investing in high yield bonds, which tend to be more volatile than investment grade fixed income securities, is speculative. These bonds are affected by interest rate changes and the creditworthiness of the issuers, and investing in high yield bonds poses additional credit risk, as well as greater risk of default.
Hedge Funds - An investment in hedge funds is speculative and involves a high degree of risk, and is suitable only for "Qualified Purchasers" as defined by the US Investment Company Act of 1940 and "Accredited Investors" as defined in Regulation D of the 1933 Securities Act. No assurance can be given that a hedge fund's investment objective will be achieved, or that investors will receive a return of all or part of their investment.
Commodities - The risk of loss in trading commodities can be substantial. The price of commodities (e.g., raw industrial materials such as gold, copper and aluminium) may be subject to substantial fluctuations over short periods of time and may be affected by unpredicted international monetary and political policies. Additionally, valuations of commodities may be susceptible to such adverse global economic, political or regulatory developments. Prospective investors must independently assess the appropriateness of an investment in commodities in light of their own financial condition and objectives. Not all affiliates or subsidiaries of Deutsche Bank Group offer commodities or commodities-related products and services.
Investment in private equity funds is speculative and involves significant risks including illiquidity, heightened potential for loss and lack of transparency. The environment for private equity investments is increasingly volatile and competitive, and an investor should only invest in the fund if the investor can withstand a total loss. In light of the fact that there are restrictions on withdrawals, transfers and redemptions, and the Funds are not registered under the securities laws of any jurisdictions, an investment in the funds will be illiquid. Investors should be prepared to bear the financial risks of their investments for an indefinite period of time.
Investment in real estate may be or become nonperforming after acquisition for a wide variety of reasons.
Nonperforming real estate investment may require substantial workout negotiations and/ or restructuring.
Environmental liabilities may pose a risk such that the owner or operator of real property may become liable for the costs of removal or remediation of certain hazardous substances released on, about, under, or in its property. Additionally, to the extent real estate investments are made in foreign countries, such countries may prove to be politically or economically unstable. Finally, exposure to fluctuations in currency exchange rates may affect the value of a real estate investment.
Risk Warnings
3
Deutsche Asset Management
Structured solutions are not suitable for all investors due to potential illiquidity, optionality, time to redemption, and the payoff profile of the strategy. We or our affiliates or persons associated with us or such affiliates may: maintain a long or short position in securities referred to herein, or in related futures or options, purchase or sell, make a market in, or engage in any other transaction involving such securities, and earn brokerage or other compensation. Calculations of returns on the instruments may be linked to a referenced index or interest rate. In such cases, the investments may not be suitable for persons unfamiliar with such index or interest rates, or unwilling or unable to bear the risks associated with the transaction. Products denominated in a currency, other than the investor’s home currency, will be subject to changes in exchange rates, which may have an adverse effect on the value, price or income return of the products. These products may not be readily realizable investments and are not traded on any regulated market.
Additional risks to consider involve interest rates, currencies, credit, political, liquidity, time value, commodity and market risks. Please consider carefully before investing.
Introduction – A Flexible Approach to Multi Asset Investing
Investment Process – A Focus on Risk-Adjusted Returns
Investment Team
Performance & Positioning
05 Appendix
Deutsche Asset& Wealth Management
DWS Concept Kaldemorgen – Investing in the „risk comfort zone“
6Deutsche AssetManagement
Volatility capped at 10% pa*
Many clients focus on a “risk comfort zone”
Capital preservation
feature(Max DD capped at 10% any calendar
year*)
Flexible & unconstrained combined with rigorous risk
control
Objective: positive total
return Investing across asset classes and
geographiesAO
6* Aspired, not guaranteed ** In a calendar year. Aspired, not guaranteed.No assurance can be given that investment objectives will be achievedAny security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation.
Deutsche Asset& Wealth Management
Market cap / Holdings No restriction / 75 - 150
Single positions <5% of total portfolio (historically)
Currency exposure Active & opportunistic FX overlay
DWS Concept KaldemorgenPerformance since launch (May 2, 2011)
9
Calculation of performance is based on the time-weighted return and excludes front-end fees. Individual costs for funds such as management / performance fee, commissions and other charges have been included in this presentation. Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation. 02.05.2011 = 100As of: March 31, 2016Source: Deutsche Asset Management Investment GmbH, Thomson Reuters Datastream, currency: Euro
DWS Multi Opportunities – The other flagship strategy of the investment team live since 2002
10
Annual Performance & Volatility of DWS Multi Opportunities since inception (May 2002)
Calculation of performance is based on the time-weighted return (FC share class) and excludes front-end fees. Individual costs such as fees, commissions and other charges have not been included in this presentation and would have an adverse impact on returns if they were included. Past performance is not a reliable indicator of future returns.
As of: March 31, 2016Source: Deutsche Asset Management International GmbH
Volatility level in the respective year
Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation.
Deutsche Asset Management
Investment Philosophy High degree of investment flexibility combined with rigorous risk control
11
MaximizeSharpe Ratio
Macro Views /Strategic Allocation (SAA)
TacticalPositioning (TAA)
Asset Selection
Diversification across asset classes /geographies
Downside RiskManagement
Total PortfolioRisk Management
Return RiskRisk-Adjusted Returns at the Core of our DNA
For Professional Clients (MiFID Directive 2004/39/EC Annex II) only.
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation. As of March 2016Source: Deutsche Asset Management Investment GmbH
Volatility Cap Maximum Drawdown („Shortfall“ model)
Target: max 10%
Average 4.53%
Min 2.59%
Max 7.82%
Max * -6.66%
• Risk management is key to optimizing risk-adjusted returns and Sharpe ratio• High degree of flexibility on the investment side is balanced by Risk Managers• Investment team considers risk from 2 different perspectives:
Volatility and Max Drawdown
DWS Concept Kaldemorgen – a Coherent Total Return StrategyRisk Management framework
Past performance is not necessarily indicative of future returns. Gross of fees performance since inception based on monthly returns in EUR.* From May 2011 to February 2016 ** Within a calendar year. No guarantee.Source: Deutsche Asset Management International GmbHAs of: February 29, 2016
Realized Realized
1Y rolling volatility*
Target: max 10%**
Target limit
Max drawdown
Deutsche Asset Management
DWS Concept KaldemorgenRisk management: „Shortfall“-approach at work
18
Warning Levels Alerts / Actions
n<= 40 days Alert, consider target risk reduction to minimum 40d expected shortfall
n<= 20 days Escalation, reduce target risk to minimum 40d expected shortfall
n>= 10 daysImmediate corrective action, positions closure, preserve at least 10d buffer to maintain a risk cushion to shortfall bottom to keep enough distance to the shortfall level
Any information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation.
1. Core – capital preservation assets acting as a buffer to reduce downside risk
2. Stable Income base – dividend stocks and credit providing a steady stream of income over time
3. Tactical / Strategic Overlay – tactical (mainly futures) and strategic (mainly direct securities) positions to take advantage of market opportunities
Capital Preservation
Assets
Content
01
02
03
04
Introduction – A Flexible Approach to Multi Asset Investing
Investment Process – A Focus on Risk-Adjusted Returns
Investment Team
Performance & Positioning
05 Appendix
Dedicated Investment TeamBoutique-style approach combined with resources of a global player
21
Deutsche Asset Management Global Research Networks
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation. Allocations are subject to change without notice.
Deutsche Asset Management
DWS Concept KaldemorgenPortfolio Characteristics
Equity Portfolio Fund Bond Portfolio Fund
24
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer orsolicitation.As of: End of February 2016Source: Deutsche Asset Management Investment GmbH
Price/Earnings Ratio (12M Forward) 14.6 Effective duration (incl. futures) -0.1
Price to Cash Flow Ratio (P/CF) 7.8 Yield to maturity 3.6%
EV/EBITDA (12M Forward) 8.9 Yield until the next possible “call“ point in time
4.1%
Net Debt to Equity 78% Average coupon 3.6%
EPS Growth (12M Forward) 2% Weighted average rating BBB+
Deutsche Asset Management
07/15 08/1580
85
90
95
100
105
DWS Concept Kaldemorgen FCMSCI World in EuroEuro Stoxx 50
DWS Concept Kaldemorgen Performance in recent market corrections
25
Calculation of performance is based on the time-weighted return and excludes front-end fees. Individual costs such as fees, commissions and other charges have not been included in this presentation and would have an adverse impact on returns if they were included. Past performance is not a reliable indicator of future returns.Status: February 29, 2016Source: Deutsche Asset Management International GmbH
04/15 05/15 06/1590
95
100
105
DWS Concept Kaldemorgen FCJPM Global Government Bond Index (EUR)
- 0.7%
- 5.1%
- 3.6%
- 12.4%
Q2 2015: Bond Sell-Off Q3/Q4 2015: China growth concern
- 13.7%
Dec 2015 - Feb 2016: Correction
11/15 12/15 01/1675
80
85
90
95
100
105
DWS Concept Kaldemorgen FCMSCI World in EuroEuro Stoxx 50
- 5.4%
- 11.1%
- 15.8%
Deutsche Asset Management
Effective Drawdown Mitigation vs. Equity MarketsAugust 2015 – February 2016
26
07/15 08/15 10/15 11/15 12/15 01/16 02/1675
80
85
90
95
100
105
EURO STOXX 50 (RI) MSCI AC World Net Return DWS Concept Kaldemorgen FC
+ 22.8%- 10.5%
Performance Volatility p.a.
+ 27.5%- 17.5%
+ 9.8%- 4.9%
Calculation of performance is based on the time-weighted return and excludes front-end fees. Individual costs for funds such as management / performance fee, commissions and other charges have been included in this presentation. Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer or solicitation.31.07.2015 = 100As of: February 29, 2016Source: Deutsche Asset Management Investment GmbH, Thomson Reuters Datastream, currency: Euro, calculation based on daily data
Deutsche Asset Management
DWS Concept KaldemorgenTurning volatility into opportunity
27
DWS Concept Kaldemorgen
Multi Asset Global MAcro
Solid Risk-Adjusted Return
5.8% paVol.: 6.1% pa
Best seller in Germany
Superior Investment
Team
Robust risk Framework
Controlled Max
Drawdown
Unconstrained & High
Conviction Portfolio
Source: Deutsche Asset Management International GmbHAs of: March 31, 2016, *: Inception Date May 2011;
Content
01
02
03
04
Introduction – A Flexible Approach to Multi Asset Investing
Investment Process – A Focus on Risk-Adjusted Returns
Investment Team
Performance & Positioning
05 Appendix
Deutsche Asset Management
Experience: Fund ManagementThe Engineers of Concept Kaldemorgen
29
Gunnar Friede joined the Company in 1997. Portfolio manager for multi asset funds since 2005. Prior to his current role, Gunnar served in various positions for the Deutsche Bank Private and Business Clients division. Global Sector Focus: IT, Telecommunications, Utilities.
Vanessa Muellerjoined the company in 2011. Portfolio Manager and Research Analyst for Global Equities .
Global Sector Focus: Consumer staples, Consumer discretionary
Thomas Graby joined the Company in 2013. Thomas is in charge of Risk Management, Performance Contribution & Attribution and performs Quantitative Analytics across the team´s strategies.
Risk Management
Karl-Alwin Hiller joined the Company in 1984. Prior to his current role, Karl-Alwin worked in Product Management, where he developed an extensive software toolbox for the Board and Sales department, including fund statistics on performance, risk and ratings.
Risk Management
Klaus Kaldemorgen is the Lead Portfolio Manager for the DWS Concept Kaldemorgen fund since its inception. He also heads the investment team.He joined DWS in 1982 as a Portfolio Manager for Global Bonds and became Head of Global equities in 1991. Klaus held various senior positions during his career at DeutscheAM including Global CIO and CEO of DWS, the Global mutual fund arm of Deutsche AM. He serves on the Board of DWS Holding & Service GmbH. He is also currently Senior Strategist Multi Asset.
Klaus Kaldemorgen is one of the most renowned fund managers in Europe.
Henning Potstada serves together with Christoph-Arend as Back-Up Portfolio Manager for DWS Concept Kaldemorgen since 2013. He is also the Lead Portfolio Manager of DWS Multi Opportunities since Jan. 2009 and of Deutsche Invest I Multi Opportunities since inception in 2014. He joined the team, which is in charge of several Global Multi Asset and Total Return strategies, in 2006. Henning holds a Master´s degree in business administration from the University of Bayreuth, Germany.
Christoph-Arend Schmidt joined the company in 2008. Together with Henning, Christoph is the Back-Up Portfolio Manager for DWS Concept Kaldemorgen. He is also the co-Lead Portfolio Manager of the DWS/Deutsche Multi Opportunities fund since January 2009. He holds a Master´s degree in business administration from the University of Bayreuth, Germany and is a CFA charterholder.
The Team
Broader Team
Deutsche Asset Management 30
Experience: Klaus Kaldemorgen and his accolades 3 decades of excellence in asset management
Doyen Klaus Kaldemorgen „Altmeister Klaus Kaldemorgen“ börse – online 12/2014
Germany´s best known fund manager “Deutschlands bekanntester Fondsmanager”Frankfurter Allgemeine Zeitung, 01/2011
The most famous funds manager in Germany “der berühmteste Fondsmanager Deutschlands” Süddeutsche Zeitung , 05/2014
The new old billion Euro man “Der neue alte Milliardenmann“ manager magazin 08/2014
* Fund renamed from Multi Opportunities II in December 2013 Past performance is not indicative of future returns
** Awarded together with Henning Potstada This information is intended for informational purposes only and does not constitute investment advice, a recommendation, an offer or solicitation.
DWS Concept Kaldemorgen Sauren Golden Awards 2015 , best Multi Asset Fund
DWS Concept Kaldemorgen Lipper European Fund Award 2015: Award for Multi Asset Funds 3 years
DWS Concept Kaldemorgen Fund Manager of the Year 2015; FINANZEN €uro am Sonntag: GOLDEN BULL
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer orsolicitation. * Bond IndicesAs of: March 31, 2016Source: Thomson Reuters Datastream, Total return in Euro
Superior Risk/Return despite headwinds Positive return of DWS Concept Kaldemorgen in 17 of the last 24 months
Monthly fund performance vs. other asset classes in %
Deutsche Asset Management
DWS Concept Kaldemorgen10 largest equity and bond positions
10 largest equity positions (in %) Largest bond positions (in %)
32
Nestlé Reg. 2.5 Corporate Bonds Issuer
Vodafone Group 1.5 Anglo American 4.5
Deutsche Telekom 1.5 T-Mobile USA 3.1
Deutsche Wohnen AG 1.4 Petrobras 2.7
Alcoa 1.3 Alcoa 2.4
Taiwan Semiconductor Manufacturing 1.2 Vale SA 2.0
Deutsche Post 1.2 Sovereign Bonds Issuer
Pfizer Inc. 1.1 United States of America 15.8
Sanofi 1.0 Italy 4.5
Fanuc Corp. 0.9 Spain 4.5
Island 0.2
Turkey 0.2
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer orsolicitation. Allocations are subject to change without notice.As of End of March 2016Source: Deutsche Asset Management Investment GmbH
Deutsche Asset Management
DWS Concept KaldemorgenSeizing opportunities in the fixed income market
33
12/12 06/13 12/13 06/14 12/14 06/15 12/153%
4%
5%
6%
7%
8%
9%
0%
5%
10%
15%
20%
25%
30%
Yield(lhs) Weight (rhs)
Yield and weighting of corporate bonds in % of the fund portfolio
As of: February 2016Source: Deutsche Asset Management Investment GmbH
Deutsche Asset Management
Past performance is not a reliable indicator of future returns. Any security information shown herein are strictly for illustrative purposes and not to be construed as an offer orsolicitation.* Calculation of performance contribution based on allocation data, residuum has been allocated proportionately to factors, relative contribution to gross performance (before
fees) As of: End of February 2016Source: Deutsche Asset Management Investment GmbH, BarraOne
DWS Concept Kaldemorgen Sources of performance since inception
34
Performance contribution of all asset classes (in EUR, since inception)DWS Concept Kaldemorgen(Share Class FC: 33.94%, LC: 29.82%)
Contribution*
Equities 49%
Equity Derivatives -4%
Corporate Bonds 25%
Sovereign Bonds 7%
Bond Derivatives -5%
Currencies 23%
Cash 2%
Gold 1%
Deutsche Asset Management
RisksOpportunities
DWS Concept Kaldemorgen
35
Source: Deutsche Asset Management International GmbH
— Market, industry and company-specific price increases on the equity markets.
— Drops in yields or increases in prices in the bond markets and/or reductions in yield spreads for high-yield securities.
— Opportunities for additional income through the use of derivative investment instruments.
— At any time, the price of the shares can fall below the price at which the investor acquired them (up to the risk of total loss).
— Market, industry and company-specific price fluctuations on the equity markets.
— Interest rate, price and currency fluctuations in the bond markets. A creditworthiness risk exists with regard to the issuers of bonds. In general terms, this is the risk of over-indebtedness or insolvency, i.e. the potential temporary or permanent inability to fulfil interest and/or repayment obligations on schedule. This can have a negative impact on the fund's performance.
— Asset-backed securities may be less liquid than corporate debt; in addition, there is the risk of early repayment, which can lead to fluctuations in the unit price.
— The use of derivatives involves counterparty risks, i.e. the creditworthiness risk of the counterparties (see the above risk notice on creditworthiness risk). Derivatives are subject neither to statutory nor voluntary deposit insurance.
— Investments in the commodities sector may be associated with illiquid markets and high volatility.
— The fund has the option of achieving leverage through the use of derivatives.The use of leverage can result in the increase in potential losses.
— The fund can invest in assets with different currencies. This gives rise to exchange rate risks, which may be hedged.
