AXA Global Investors’ investment process can be broken down into the following principal activities.

1. Investment research
A good understanding of the fundamental drivers of markets is a prerequisite to successful investing. Research shows that private investors do not naturally make good investment decisions. Time and again, investors tend to base their decisions on emotional rather than fundamental factors.

AXA Global Investors analyses the long term behaviour of investment markets in order to develop a set of quantitative inputs that are used at the portfolio design stage of our investment process. AXA Global Investors’ scale provides access to some of the world’s most renowned fund managers, who manage some of the money inside the portfolios.

2. Portfolio design
AXA Global Investors designs portfolios to meet specific investment risk and return requirements. These requirements are expressed with reference to return targets over given time horizons and with measurable probabilities of actual returns varying from target.

3. Portfolio management
Having determined broad investment policy and performance benchmarks at the design stage, AXA Global Investors’ portfolio management activities are then concerned with calibrating and implementing specific strategies aimed at achieving a satisfactory level of risk-adjusted performance relative to performance benchmarks.

To achieve this, AXA Global Investors determines and regularly reviews a set of target portfolio weights for the different asset classes and within each asset class, a set of allocations to individual managers.

This activity has very close linkages with AXA Global Investors’ research process. Understanding the shorter term prospects for different asset classes based on prevailing market prices and how the style and focus of different managers may be more suitable in different market environments are both integral to the AXA Global Investors portfolio management process.

4. Performance monitoring
Monitoring the activities of selected managers and reviewing their performance along with overall portfolio performance is a critical component of the AXA Global Investors investment process. It provides AXA Global Investors with important feedback and insights about the success of their investment strategies and often provides the catalyst for future modifications.