Insights

Europe adopted the Solvency II regulatory framework for insurance companies in 2016. In 2017 Advent authored a whitepaper about the framework which discussed the capital efficiency of the convertible asset for insurance firms regulated by Solvency II. With the passage of time and recent reforms to Solvency II which have come into effect since 2016, Advent recently revisited this topic in Solvency II Revisited which discusses what has changed, what has remained the same, and from the perspective of convertible bonds what are the implications for insurance companies. The paper concludes that Solvency II regulated insurers could increase their return on regulatory capital by allocating to convertibles in place of equity or core-fixed income.

This analysis was originally conducted in 2019 to further inform investors, advisors and consultants of the benefits of including convertibles in their asset allocation models and portfolios. This year, the asset class reached a 50-year track record milestone, and we thought it appropriate to refresh the analysis in commemoration.

Advent explores the connection between inflation and its impact on the convertible market. This whitepaper illustrates how convertibles performed over five inflationary periods dating back to the early 1970s while also discussing the connection between the key drivers of inflation and convertible performance.

Advent executives host a webinar to discuss the advantages of convertible bonds in today’s markets and the different long-only strategies used here at the firm.

Scott Reid, COO and Andrew Rice, Vice President explore why convertibles are an innovative solution for rising funding ratios and elaborate on why they are advantageous.

Read Advent’s Statement on Diversity and Inclusion, written by President and Chief Investment Officer Tracy Maitland.