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.
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The information ratio measures excess return per unit of tracking error, helping investors target efficiency under tight risk budgets.
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A 0.5 information ratio is considered good, while 1.0+ is exceptional, highlighting consistency over volatility.
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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.
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