Top Portfolio Products: American Century Rolls Out Real-Estate Fund, Allianz Launches New Fixed Index Annuity

Real-estate returns were up slightly in July, experts note, while the S&P was down

portfolio products logoAmerican Century Investments introduced the Global Real Estate Fund last Monday, citing growing investor demand for exposure to domestic and international real estate securities.

Global Real Estate seeks to outperform the MSCI AC World IMI Real Estate Index with lower volatility over a full market cycle, according to the fund firm, which is based in Kansas City, Mo. At least 75% of the portfolio's weight will be invested in developed market real estate-related securities and up to 25% in emerging markets.

American Century’s new fund is being led by veteran Senior Portfolio Manager Steven Brown, while the fund’s investment analysts are Steven Rodriguez and Vishal Govil.

"In the last five years, we have seen a shift in preference to global investing as clients seek higher returns and ways to possibly reduce the impact of inflation," said Brown, in a press release. "The fund has the added benefit of potentially increasing investors' portfolio diversification."

On Friday, NAREIT Senior Vice President of Research and Industry Information Brad Case said July 2011 was another strong month for REITs, as equity REITs gained more than 1% for the month. The broader REIT industry was up 0.4% in July vs. a 2% decline for the broader stock market.

REITs have gained more than 10% for the first seven months of 2011, compared to less than 4% for the broader market, according to Case.

American Century’s new fund is being led by veteran Senior Portfolio Manager Steven Brown, while the fund’s investment analysts are Steven Rodriguez and Vishal Govil. The company says the fund is classified as non-diversified and thus may hold large positions in a small number of securities.

American Century Investments is privately controlled and gives some 40% of its profits to support research that aims to find cures for genetically-based diseases including cancer, diabetes and dementia.

Allianz Life Insurance Company of North America said Aug. 1 that it had introduced Allianz 360, a fixed index annuity (FIA) exclusive to field marketing organizations and agents associated with the recently launched Allianz Preferred distribution model. Now available in 36 states, the newest FIA offers investors unique increasing income benefits for both accumulation and income, the Minneapolis-based company says.

“It’s clear that many boomers are worried about how factors like inflation and longevity will affect the stability of their retirement income,” said Allianz Life Senior Vice President of Sales Eric Thomes, in a press release. “Allianz 360 ensures they are protected with guaranteed lifetime income that has the opportunity to increase when they are in retirement.”

While accumulating, the lifetime payout percentage increases every year the client holds the contract prior to income beginning, starting at age 40. It also has a 50% interest bonus of any interest credited every year prior to taking income withdrawals.

The interest and bonus are credited to the accumulation value, which means it’s available for lump sum (surrender charges may apply), income withdrawals or death benefit.  Traditional annuity payments are also available. These benefits are available via a mandatory rider which carries a charge of 0.95% of the accumulation value.

“The longer you hold Allianz 360 before taking lifetime income withdrawals, the greater the percentage of income available for lifetime withdrawals will be,” said Thomes. “If a customer purchased the contract at age 55 and held it for 10 years, their withdrawal percentage would increase from 3.50% to 7% or 4.50% to 8% depending on the income option they chose. No other annuity offers this benefit.”

Read last week’s Portfolio Products Roundup at AdvisorOne.com

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