AQR DynamiQ Allocation Index℠ Seeks Steady, Repeatable Returns
Through Global Diversification and AQR’s Unique, Style-Based
Methodology
AIG Life & Retirement, a division of
American International Group, Inc. (NYSE: AIG) and a leading
provider of annuities, today announced the launch of the new AQR
DynamiQ Allocation Index, available exclusively through the Power
Protector Series of Index Annuities. This multi-style index has
been designed by AQR Indices, LLC, a subsidiary of AQR Capital
Management, LLC, a global systematic investment management firm
recognized for its efficient portfolio construction and world-class
research on investing, economic theory and behavioral finance.
The AQR DynamiQ Allocation Index is the first-ever index to be
developed by AQR for use in an index annuity. It seeks to enhance
returns and reduce risk by dynamically allocating across equity and
fixed income markets from around the world. The index uses AQR’s
unique, style-based (factor) methodology to identify assets that
have the potential to perform well across a variety of market
environments. The AQR DynamiQ Allocation Index is not available for
direct investment, but its returns are used to help determine the
interest earned in the index annuity. In addition, any assets
allocated to the index annuity are protected against market
downturns, so consumers never lose principal or any interest earned
due to market volatility.
“We are excited that AIG Life & Retirement will be the first
to bring AQR’s sophisticated, style-based investment approach to
consumers through an index annuity,” said Bryan Pinsky, Senior Vice
President of Individual Retirement Pricing and Product Development
at AIG. “AQR has built customized portfolios for some of the
world’s largest institutional investors. Now they have taken the
best practices and lessons learned from managing those assets to
develop an index designed to provide stable growth with strong risk
management.”
AQR’s signature index methodology is based on its decades-long
research into styles, or factors that drive an asset’s performance.
The AQR DynamiQ Allocation Index is designed to boost performance
potential while managing downside risk by combining five distinct
styles: Value (cheap assets), Momentum (assets that show positive
long-term performance), Carry (higher-yielding fixed income
assets), Defensive (higher quality, lower risk equities) and Trend
(assets that show positive short-term performance). These styles
are dynamically allocated across asset classes and geographic
regions on a monthly basis based on a systematic, rules-based
process that seeks to take advantage of changing market
conditions.
“AQR is proud to work with AIG Life & Retirement to extend
our expertise in applying analytical research to solve challenging
client problems,” said David Kabiller, co-Founder of AQR. “We are
committed to investment innovation and excited to apply it to index
annuities. By diversifying across multiple styles, asset classes
and geographies, the AQR DynamiQ Allocation Index has the potential
to produce more consistent returns with lower risk than many
indices.”
The AQR DynamiQ Allocation Index is available exclusively in the
Power Protector Series of Index Annuities, which is issued by
American General Life Insurance Company and distributed primarily
through independent marketing organizations. These annuities
combine tax deferral, principal protection against down markets,
growth potential through a diverse range of index interest
accounts, and guaranteed lifetime income options to help consumers
prepare for retirement. Guarantees are backed by the claim-paying
ability of American General Life Insurance Company.
Index annuities are not a direct investment in the stock market.
They are long-term insurance products with guarantees backed by the
claims-paying ability of the issuing insurance company. They
provide the potential for interest to be credited based in part on
the performance of the specified index, without the risk of loss of
premium due to market downturns or fluctuations. Index annuities
may not be appropriate for all individuals.
Withdrawals may be subject to federal and/or state income taxes.
An additional 10 federal tax may apply if you make withdrawals or
surrender your annuity before age 59½. Consult your tax advisor
regarding your specific situation.
Diversification and risk management strategies do not guarantee
positive performance or prevent negative returns. There are no
assurances that any objectives will be achieved. Depending on index
performance and other factors, individuals may earn no interest in
the index annuity.
Interest earned in an index annuity is calculated using index
performance over a specific term, subject to contract provisions,
such as an index rate cap, spread or participation rate, which may
limit or reduce the upside potential. The index rate cap is the
maximum percentage of index performance that can be credited as
interest for an index term. The spread is the minimum threshold or
percentage that index performance must exceed to be credited
interest. The participation rate is the percentage of index
performance that is used to calculate interest in certain
accounts.
AQR and the AQR DynamiQ Allocation Index℠ are trademarks or
service marks of AQR Capital Management, LLC or one of its
affiliates (“AQR”) and have been licensed for use by American
General Life Insurance Company (the “Company”) for use as a
benchmark for an annuity (inclusive of all applicable riders, the
“Product”). The Product is not sponsored, endorsed, sold or
promoted by AQR or its affiliates, and they do not provide any
investment advice to the Company with respect to the Product or to
owners of the Product, nor do they make any representation
regarding the advisability of investing in the Product or obtaining
exposure to the Index. The Index is constructed without regard to
the investment needs or suitability of the Company, the Product, or
any Product owners. AQR and the Index’s calculation agent have no
obligation or liability whatsoever with respect to, and make no
representations regarding, the Product. AQR makes no representation
regarding the ability of the Index to achieve its goals and
disclaims all express or implied warranties, including any warranty
of merchantability and fitness for a particular purpose or use, in
connection with the Index, including, without limitation, any
results to be obtained by tracking the Index. Neither AQR nor the
Index’s Calculation Agent guarantees the accuracy or completeness
of the Index. NONE OF AQR OR ITS AFFILIATES SHALL HAVE ANY
LIABILITY FOR ANY ERRORS, OMISSION OR INTERRUPTIONS OF OR IN
CONNECTION WITH THE INDEX OR ANY DATA INCLUDED THEREIN OR FOR THE
PRODUCT.
The AQR DynamiQ Allocation Index℠ is a long only index providing
exposure to futures on third-party equity indices primarily
comprised of large-cap securities of U.S. and non-U.S. issuers from
developed markets, and exposure to futures on U.S. and non-U.S.
developed government fixed income securities.
The AQR DynamiQ Allocation Index℠ (the “Index”) embeds an annual
index cost in the calculations of the change in index value. This
embedded index cost will reduce any change in index value, and it
funds certain operational and licensing costs for the Index. Since
it will affect the return of the Index, it may also impact the
amount of interest credited to an index annuity; however, it is not
a fee paid by the policy owner or received by the issuing insurance
company.
Index annuities are issued by American General Life Insurance
Company (AGL), 2727-A Allen Parkway, Houston, Texas 77019.
Contract Numbers for the Power Series of Index Annuities: AG-800
(12/12) and AG-801 (12/12). AGL is a member of the American
International Group, Inc. (AIG) family of financial services
companies. The underwriting risks, financial and contractual
obligations and support functions associated with the annuities
issued by AGL are its responsibility. AGL does not issue products
in the state of New York. Annuities and riders may vary by state
and are not available in all states. AIG and its member companies
are not affiliated with AQR.
Not FDIC or NCUA/NCUSIF Insured May Lose Value • No Bank or Credit
Union Guarantee Not a Deposit • Not Insured by any Federal
Government Agency
About AIG Life & Retirement
AIG Life & Retirement brings together a broad portfolio of
protection, retirement savings, investment and lifetime income
solutions to help people achieve financial and retirement security.
The business consists of four operating segments – Individual
Retirement, AIG Retirement Services, Life Insurance and
Institutional Markets – and holds longstanding, leading market
positions in many of the markets it serves.
AIG Life & Retirement includes AIG member insurance
companies American General Life Insurance Company (Houston, TX),
The United States Life Insurance Company in the City of New York,
and The Variable Annuity Life Insurance Company (VALIC), Houston,
TX as well as their affiliates. Securities products are distributed
by AIG Capital Services, Inc., member FINRA. Additional information
about AIG Life & Retirement can be found at
www.linkedin.com/showcase/aig-life-&-retirement.
About AIG
American International Group, Inc. (AIG) is a leading global
insurance organization. AIG member companies provide a wide range
of property casualty insurance, life insurance, retirement
solutions, and other financial services to customers in more than
80 countries and jurisdictions. These diverse offerings include
products and services that help businesses and individuals protect
their assets, manage risks and provide for retirement security. AIG
common stock is listed on the New York Stock Exchange.
Additional information about AIG can be found at www.aig.com |
YouTube: www.youtube.com/aig | Twitter: @AIGinsurance
www.twitter.com/AIGinsurance | LinkedIn:
www.linkedin.com/company/aig. These references with additional
information about AIG have been provided as a convenience, and the
information contained on such websites is not incorporated by
reference into this press release.
AIG is the marketing name for the worldwide property-casualty,
life and retirement, and general insurance operations of American
International Group, Inc. For additional information, please visit
our website at www.aig.com. All products and services are written
or provided by subsidiaries or affiliates of American International
Group, Inc. Products or services may not be available in all
countries and jurisdictions, and coverage is subject to
underwriting requirements and actual policy language. Non-insurance
products and services may be provided by independent third parties.
Certain property-casualty coverages may be provided by a surplus
lines insurer. Surplus lines insurers do not generally participate
in state guaranty funds, and insureds are therefore not protected
by such funds.
About AQR
AQR is a global investment management firm dedicated to
delivering results for its clients. At the nexus of economics,
behavioral finance, data and technology, AQR’s evolution over two
decades has been a continuous exploration of what drives markets
and how it can be applied to client portfolios. The firm is
headquartered in Greenwich, Connecticut, with offices in Bangalore,
Boston, Chicago, Frankfurt, Hong Kong, London, Los Angeles and
Sydney.
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version on businesswire.com: https://www.businesswire.com/news/home/20200610005367/en/
Sabra Purtill (Investors): 212-770-7074; sabra.purtill@aig.com
Matt Burkhard (Media): 212-458-4253; matt.burkhard@aig.com
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