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Market Neutral Long/Short European Equities

Allianz Discovery Europe Strategy Allianz Discovery Germany Strategy July 2015

Harald Sporleder Spencer Rhodes

For institutions and professional investors only.

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Global AUM of EUR 454 billion

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Environmental, Social and Governance Team 1 Assets under Advice and Assets under Management as at 31 March 2015. 2 Representative list of investment strategies. Not all strategies are currently available in all markets. Not all Allianz entities operate in all markets.

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AllianzGI Liquid Alternative Strategies

Overview Equity Long/Short Market Neutral

Discovery Europe

   Frankfurt Long/Short European Eq Net Market Exposure +/- 15%

Discovery Germany

   Frankfurt Long/Short German Eq Net Market Exposure +/- 15%

Discovery Asia

   Hong Kong Long/Short Asia ex-Japan Eq Net Market Exposure +/- 15%

Structured Alpha Team Options Strategies

Structured Alpha

   New York Listed US Index Options Absolute Return

Systematic Alternative Risk Premia Global Strategies

Merger Arbitrage

   Frankfurt Systematic Hedged Equities Merger Arb Risk Premium

Global Fundamental Strategy

   London, Frankfurt, SF, Munich Global Macro Absolute Return

US Equity Hedged

   New York S&P500 + Buy Puts, Sell Calls Sophisticated Collar Strategy

Volatility Strategy

   Frankfurt Short Variance Swaps Variance Risk Premium

Structured Return

   New York Sell in-the-money covered calls Absolute Return

Dynamic Commodities

   Frankfurt Actively Managed ETCs Diversified Long Commodities

Total Liquid Alts AUM: €3.4 Billion

1 Source: Allianz Global Investors; data as per 31.10.2014.

For institutions and professional investors only.

Allianz Global Investors: a stable home with vast resources • A trusted name in fund management, with €454 billion

across nearly all asset classes • Very stable parent company – the world’s largest insurer

• Global research, global trading platform, stringent risk management processes • Delivering innovative alternative strategies that seek uncorrelated returns The AllianzGI platform helps alternative fund managers generate investment returns and manage risks

External Independent Risk Management (IDS) Internal Risk Management Robust Operations and Governance Macro and Micro Research in Nearly All Asset Classes Global Trading Platform for Best Execution Alignment of Incentives to Retain Talent Top-ranked Client Service 1 Assets under Advice and Assets under Management as at 31 March 2015. 2 "Forbes Global 2000: The World's Biggest Public Companies”, Forbes, March 2015, based on sales and market value.

For institutions and professional investors only.

Allianz Global Investors: The European Equity Experts

AUM European Equity ( €, bn)

Total Members Europe Equity Team

In-house Equity Research Analysts Europe

46 Source: Allianz Global Investors, 20.01.2015. AUM European Equity as at 31.05.2015. 1 Includes equity portfolio managers and analysts.

For institutions and professional investors only.

Allianz Global Investors: The European Equity Experts Large, Experienced, Award-winning Team

Resources Multiple locations Macro-economic & Systematic Research Proprietary Screening tools Sell-side Research Grassroots SM Research 1 European Equity Portfolio Management Team Global Research Platform Key competencies Europe Equity Growth • 48 members • over 15 years’ average experience Euroland Equity Growth German Equity Europe Equity Dividend Europe Small Cap Equity Europe Long/Short Equities

Source: AllianzGI as at March 2015. Allianz Europe Equity Growth was awarded 1st place for 3 and 5 year performance in the Equity Europe sector by Lipper in 2012 and 2013. Allianz Euroland Equity Growth fund was awarded 1st place for 3 and 5 year performance in the Equity Eurozone sector by Lipper in 2012. Thorsten Winkelmann received two gold medals, and Matthias Born received one gold medal, and Frank Hansen received one gold medal in the Sauren Golden Awards 2014. Finanzen Euro Awards 2015: Allianz Europe Equity Growth A EUR (rank 2, 5yr period), Allianz Euroland Equity Growth A EUR (rank 3, 5yr period), Allianz Wachstum Europa A EUR (rank 1, 10yr period), Allianz Wachstum Euroland A EUR (rank 3, 10yr period), and Allianz Nebenwerte Deutschland A EUR (rank 2, 10yr period). Feri EuroRating Awards 2015: Concentra belongs to the top five funds with the sector Equity Germany. Allianz Global Investors was awarded Global Group of the Year in 2012-13 and Allianz Europe Equity Growth AT EUR was awarded Pan Europe Equity Fund of the Year 2012-13 by InvestmentEurope. Allianz Europe Equity Growth was awarded Deutscher Fondspreis 2013 for outstanding /excellence performance in the Europe Equity category over 5 years (Issued by FONDS Professionell in Germany).

1 Grassroots SM Research is a division within the Allianz Global Investors group of companies that commissions investigative research for asset-management professionals. Research data used to generate Grassroots SM Research reports are received from reporters and field force investigators who work as independent, third party research providers, supplying research that is paid for by commissions generated by trades executed on behalf of clients.

Long/Short Capabilities

European AUM (mil Euros) Discovery Europe Discovery Germany Total European L/S Equities 357 m 189 m 546 m European Long/Short Equities

2004 2007 2009 2011 Began paper portfolio for Discovery Europe Launch of Discovery Europe (Cayman) Conversion of Discovery Europe to UCITS fund Launch of Discovery Germany UCITS fund

Asian Long/Short Equities

2008 Initiated 30/30 long / short overlay of RCM Asia 130/30 Fund 2010 Shorting available in Taiwan and Korea – expanded universe of pair trade strategy 2011 2014 Initiated 20/20 long / short overlay of Allianz Tiger Fund Launch of Allianz Discovery Asia Strategy Source: Allianz Global Investors, as at 31 June 2015. Allianz Asia Long / Short Strategy refers to the 30/30 long / short carve-out strategy from RCM Asia 130/30 Funds Segregated Portfolio (sub-fund of Allianz Global Investors Alternative Funds I SPC) via physical shorts (from Mar-08 to May-10) and the 20/20 long / short carve-out strategy from Allianz Tiger Fund (sub-fund of Allianz Global Investors Fund) via equity swaps (from Jun-10 till date). All historical portfolio positioning and characteristics are calculated by rescaling the larger of total long or short exposure to 100%. All portfolio performance information are extrapolated to 100% base, and calculated on gross-of-fee basis. Expenses such as borrowing cost, swap financing cost, and dividend cost are deducted from the returns.

Three Levels of Fundamental Research

Long/Short Team Harald Sporleder

Lead PM since paper portfolio created in 2004 (19 years of experience)

Ralf Walter

Co-Portfolio Manager (17 years of experience)

Steffen Weyl

Co-Portfolio Manager (7 years of experience)

Spencer Rhodes

Senior Product Specialist (14 years of experience)

Top-down Calls AllianzGI Research Country Focus and

Total Members Europe Equity Team

In-house Research Analysts Europe

AUM European Equity ( €, bn)

47 Sector Focus Grassroots SM Research 1 Proprietary investigative research system Resources

   In-house staff of 10 57 reporters 300+ Field Force investigators  50,000+ industry contacts

Results

 35+ company/industry studies per month

Specific Bottom-up Research Projects

AllianzGI Research figures as of 20 January 2015. Grassroots SM Research figures as of March 2015.

¹ Grassroots SM Research is a division of Allianz Global Investors that commissions investigative research for asset-management professionals. Research data used to generate Grassroots SM Research reports are received from Reporters and Field Force Investigators who work as independent, third-party research providers, supplying research that is paid for by commissions generated by trades executed on behalf of clients.

Allianz Discovery Europe Strategy

For institutions and professional investors only.

Allianz Discovery Europe Strategy Market Neutral Long/Short European Equities

What Long and short positions in European Equities which lead to low correlation to movements in the overall equities market (beta target: <0.2) Why Allows Fund Management Team to take advantage of both positive views on companies (longs) and negative views on companies (shorts) to make better use of research Competitive Advantage Non-consensus fundamental stock picks leveraging AllianzGI’s best-in-class European Equities platform Client Need in 2014 1.

Equity Substitute: The Market Neutral approach can benefit in rising or falling markets. After the strong bull market of 2012 and 2013, some clients may want less exposure to long equity beta Bond Substitute: Some clients view the fund as a bond substitute because of the steady historical returns and low volatility

Team Harald Sporleder

Lead PM since paper portfolio created in 2004 (19 years of experience)

Ralf Walter

Co-Portfolio Manager (17 years of experience)

Steffen Weyl

Co-Portfolio Manager (7 years of experience)

Spencer Rhodes

Alternative Investments Global Business Manager (14 years of experience) Past performance is not a guarantee of future results.

For institutions and professional investors only.

Allianz Discovery Europe Strategy

Market Neutral Long/Short European Equities Fundamental Stock Picking Non consensus

Not Focused on Pair Trades Active Sector and Country Views No Derivatives in Underlying Portfolio



Transparent



Easy to understand



Return Target: 5-8%



Volatility Target: 5-9%

1 Non-Consensus signifies an anti-cyclical investment style, which tries to disregard generally held views and opinions and regularly makes investments which run counter to the general trend. 2 Our UCITS-vehicle is implemented via a Total Return Swap with our Prime Broker.

For institutions and professional investors only.

Competitive Advantages Corporate Access Grassroots

Research

1 

Approximately 100 on-site company visits by hedge fund team per year



Short idea validation Regional PM-Structure within hedge fund team



Network and country-specific experience Large Platform Daily External Risk Management Review Efficient and state of the art trading and administration procedures



Idea debate between long-only and hedge fund team

 

Reduction of emotional biases and keeping the fund within parameters Portfolio Manager can focus on idea generation

For institutions and professional investors only.

Grassroots

Research

Mission:

To provide investment professionals with timely, unique and customised business insights

Client

Methodology

 Customised to answer specific questions about key stock drivers identified by portfolio managers and analysts  

Resources

 In-house staff of 10  57 reporters 300+ Field Force investigators 50,000+ industry contacts

Results

 35+ company/industry studies per month Portfolio Managers Sector Analysts Grassroots SM Analysts Experts Regulators Managers Grassroots SM Reporters Field Force Investigators Consumers Suppliers Distributors Physicians Competitors Customers

www.grassrootsresearch.com

Investment decisions – reality checked

Source: AllianzGI, as at March 2015.

1 Grassroots SM Research is a division of AllianzGI. Research data used to generate Grassroots SM Research recommendations is received from reporters and field force investigators who work as independent contractors for broker-dealers. Those broker-dealers supply research to AllianzGI and certain of its affiliates that is paid for by commissions generated by orders executed on behalf of AllianzGI’s clients.

For institutions and professional investors only.

Recent Grassroots

Research study topics with European focus:

Consumer

                 Gerry Weber International’s Taifun Brand at Multibrand Retailers in Germany Danone’s Dumex Infant Formula in China Success of the New Store Concept for Groupe FNAC in France Orkla Foods in Norway Demand for the Porsche Macan in Germany Demand for Hugo Boss Apparel in China LPP in Russia Braun Product Demand in the Small Household-Appliance Segment in Germany Estee Lauder Brand Perception in First-Tier Cities in China Luxury Watch Demand During Golden Week in China and Hong Kong Demand for the BMW i3 in the US Just Eat's Alloresto.fr Service Demand in France Vacation Bookings at Thomas Cook and TUI Travel Agencies in Germany De’Longhi Coffeemaker Demand in Germany Franchisee Satisfaction at DIA in Spain Coca Cola Life in Europe and the US Apparel Product Demand in Russia

Healthcare

       Hospital Capital Equipment Spending Trends in Europe Ferinject in Switzerland, and Europe Injectafer in the US Actelion's Opsumit in the US Lundbeck's Brintellix in the US Essilor’s Crizal Prevencia Lens Demand at Opticians in the US Demand for GSK’s New Anoro and Relvar COPD Drugs in Germany and the UK

Financials

    Resolution's Protection and Annuities Business in the UK Prudential in Malaysia, Indonesia, Hong Kong and Singapore Real Estate Market in Spain Willingness of Real Estate Developers in Italy to Borrow Money from Banks

Technology

     Linx in Brazil NSA Scandal's Impact on Corporate IT Spending in Germany Aveva’s E3D Software in the US SAP's In-Memory Product HANA Among IT Consultants in Germany SAP's In-Memory Product HANA Among Corporates in Germany

Industrials

     Agricultural Equipment Demand in France FirstGroup Bus Service Trends in Bristol, UK Regus ’ Serviced Offices Demand in the US and the UK Dairy Processing Machinery Demand in China Solar Production Machinery Demand in China and Taiwan

Macro

  Consumer Sentiment and Spending Trends in Italy Consumer Sentiment and Spending Trends in Spain Data from AllianzGI, showing selected Grassroots SM Research study topics commissioned by AllianzGI in Q4 2014 and Q1 2015, as of 31.03.2015. This is no recommendation or solicitation to buy or sell any particular security. Grassroots SM Research is a division of Allianz Global Investors that commissions investigative research for asset management professionals. Research data used to generate Grassroots SM Research reports are received from reporters and field force investigators who work as independent, third-party research providers, supplying research that is paid for by commissions generated by trades executed on behalf of clients.

For institutions and professional investors only.

Investment Process – Variety of Trades

Directional Trades

Target Weight:

20% - 65% of the Fund

Investment-Case:

     Corporate News Political and regulatory Changes Structural sectoral changes Historical valuation pattern Technical structure

Time Horizon:

1 day – 3 months

Trade categories Thematic Trades Restructuring Trades

Target Weight:

20% - 60% of the Fund

Investment-Case:

  Identification of structural long term, political, regulatory changes Changes in product demand, industrial structures, client demand or technology

Target Weight:

app. 20% of the Fund

Investment-Case:

 Identification of best-case and worst-case scenerios as well as modelling of maximum earnings parameters / turnaround ideas

Time Horizon:

6 months – 3 years

Time Horizon:

1 month – 3 years Other less important trade types:  Relative Trades (10%-30% weighting) based on relative valuations and historical trading patterns (time horizon 3 to 6 months)  IPOs (max weight 10%) participation in market opportunities (time horizon short/mid term) 1 The strategy is implemented via single stock Swaps (CFD’s- Contract for Difference). Please also refer to the opportunities and risks at the end of this presentation.

For institutions and professional investors only.

Allianz Discovery Europe Strategy Short Sale: More than balancing the portfolio

1 • •

Valuation

Stock trades on premium multiple Share price above our target price • • •

Structural positioning

Weak competitive position Structurally endangered end markets Political risks • • •

Catalyst

Technical factors Management changes Financial reporting

Sweet spot to open short position

• Share price potential is skewed to the downside • Company fundamentals deteriorating • Expected news flow likely to move market awareness towards our perception 1 Please also refer to the opportunities and risks at the end of this presentation. 16

For institutions and professional investors only.

Long Pandora I – structural growth

Investment case

 High growth company at reasonable price. Strong share price movement of recent three years only driven by earnings growth, revaluation yet to come, and growth expected to stay high  Strong balance sheet: no debt, targets net debt / EBITDA at 1x, DKK 13.8bn FCF 2014, all cash back to shareholders via share buy back and dividend, well invested, capital light growth (franchisee model), no cash miss-use for M&A expected  Higher margins vs. Luxury peers, higher ROCE, but cheaper despite higher growth  High growth opportunities from 3 dimensions:    (1) expansion into new regions such as China, Japan (2) increasing penetration in existing markets (U.S. still!) (3) additional product categories – more focus on rings PE Pandora Tiffany Richemont 2014e 18.2

21.3

24.0

2015e 13.9

21.1

19.3

Kering LVMH 19.2

24.2

Source: Bloomberg consensus.

16.3

19.9

2016e 11.5

19.9

17.5

14.7

18.1

Strong share price increase but still cheap.

Driven by earnings growth.

EBITDA Margin 50,0% 40,0% 30,0% 20,0% 10,0% 0,0% Pandora FY13 Tiffany FY14e Richemont FY15e Source: JPMorgan.

Kering FY16e LVMH ROCE 80,0% 70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0% Pandora FY13 Source: JPMorgan.

Tiffany Richemont FY14e FY15e Kering FY16e LVMH FCF-Yield 8,0% 6,0% 4,0% 2,0% 0,0% Pandora Tiffany FY13 Richemont FY14e FY15e Source: JPMorgan.

Kering FY16e LVMH Source: Allianz Global Investors, Bloomberg, JP Morgan; February 2015. This is no recommendation to buy or sell any particular security. Past performance is not a reliable indicator of future results.

For institutions and professional investors only.

Long Pandora II – increased in weakness due to conviction

Stock underperformed in Q4 ‘14 and Q1 ‘15 due to uncertainties about U.S. Christmas sales

 PM team initiating 2 dedicated Grassroots SM Research 1 studies on U.S. Christmas trading  First report already kicked-off before Christmas, carried out between Christmas and New Y ear’s Eve  Second report more specified version reacting on market concerns  Grassroots indicated good Christmas business in the U.S., in contrast to market concerns  Particularly attractive risk/reward situation identified -> we increased our position Opening initial position Source: Allianz Global Investors, Bloomberg; February 2015. This is no recommendation to buy or sell any particular security.

1 Grassroots SM Research is a division within the Allianz Global Investors group of companies that commissions investigative research for asset-management professionals. Research data used to generate Grassroots field force investigators who work as independent, third party research providers, supplying research that is paid for by commissions generated by trades executed on behalf of clients. Past performance is not a reliable indicator of future results.

SM Research reports are received from reporters and 18

For institutions and professional investors only.

Stock Examples – A contrarian view

Nokia - Long Symrise - Long Tesco - Short

Recent Longs Recent Shorts

 Dialog, Nokia, Daimler, KPN, Vodafone, Actelion, Symrise, Kerry Group  Tesco, WM Morrison, DIA, Fortum, RWE ,Verbund, ABB, STM Source: AllianzGI; data as per January 2015. This is no recommendation or solicitation to buy or sell any particular security. If the currency in which the past performance is displayed differs from the currency of the country in which the investor resides, then the investor should be aware that due to the exchange rate fluctuations the performance shown may be higher or lower if converted into the investor’s local currency. This is no recommendation or solicitation to buy or sell any particular security.”1 Purchasing and selling decisions are specific examples of the successful implementation of our purchasing/selling strategy and are not meant as a description of a success model or as a guarantee of a positive performance. There is no guarantee that all purchasing or selling decisions by AllianzGI lead to a profitable result. Past performance is not a reliable indicator of future results. The stocks mentioned as examples will not necessarily form part of the basket/composition of the swap. If any of the mentioned stocks should become part of the basket/ composition of the swap, it does not imply that such stocks will form part of the basket / composition of the swap by the time this document is disclosed or at any other subsequent date.

For institutions and professional investors only.

Theme Example

M&A in Europe:

 Strong players can now benefit from taking out weaker competitors Gain market share Facilitate client access Enhance product knowledge  Once in a lifetime cheap money opportunity: Low interest rates Cheap refinancing  Brussels regulators starting to see Europe as one market 20

For institutions and professional investors only.

Risk Management

 External Risk Manager  Trading and administration separate from portfolio management Value at Risk 1 Portfolio Beta 2 Volatility 3

Expected Parameters

Sector Exposure Country Exposure Maximum Leverage 4 Maximum Single stock weightings Maximum Net Exposure 5 < 10% < 0.2

5-9% + 15 / -15 + 15% /-15% 2 times +3.5%/ -3.5% + 15% / -15% Daily monitoring of the risk parameters through an independent risk management team contributes to the success of the strategy 6 1 The Value at Risk reflects the maximum loss in a given period with a certain confidence level of X %. Under the investment strategy, the Value at Risk of any individual position should not contribute more than 10 % to the total Value at Risk. This is the Value at Risk with a confidence level of 95 % for a 10-day period, which is forecast ex ante on the basis of the Wilshire Atlas covariance factor matrix (equal weights) for a period of 500 days.

2 Beta is the measure of the market risk of an investment (systemic risk) and shows how portfolio movements are in line with the market. A beta of 1 means that the portfolio movement is equivalent to the average (market). The beta of the investment strategy is the forecast beta in comparison to the MSCI Europe T.R. Index (Net), which is forecast ex ante on the basis of the Wilshire Atlas covariance factor matrix (equal weights) for a period of 500 days.

3 Measure for the degree of performance variation of the investment strategy during a given period. This is the expected volatility, which is forecast ex ante on the basis of the Wilshire Atlas covariance factor matrix (equal weights) for a period of 500 days.

4 Leverage is the extent to which the investment strategy creates an exposure to assets which exceeds the fund volume. The leverage is usually financed by loans.

5 The difference between the long and short positions (long positions minus short positions) may not exceed or undershoot +30 %/-30 %. Long positions = purchased equities. Short positions = (short) sold equities.

6 There is no guarantee that the target parameters are reached.

For institutions and professional investors only.

Cumulative Performance Since Inception (net of fees)

Allianz Discovery Europe (Cayman 06/07-10/09) (UCITS III 10/09-current)

60 40 20 0 -20 -40 -60

Annual Data

2015 YTD 2014 2013 2012 2011 2010 2009 2008 2007 (inception year)*

Fund

5.67% 0.06% 4.42% 9.91% 3.46% -1.89% 12.70% 1.62% 6.62%

Volatility

n.a.

3.76% 3.61% 4.30% 4.61% 6.09% 8.62% 7.67% n.a.

 Positive results in the key years: 2007* 2008 2011 Discovery Europe Cumulative Total MSCI Europe Monthly Inception: 05.06.2007. *Partial year. Source: IDS; data as per 31.05.2015. Past performance is not a reliable indicator of future results.

For institutions and professional investors only.

Annualised Performance Since Inception (net of fees)

Allianz Discovery Europe (Cayman 06/07-10/09) (UCITS III 10/09-current)

7 6 1 0 5 4 3 2 5,7 3,8 5,1 5,0 4,1 YTD N/A 1 Year Return 3 Year p.a.

Source: Allianz Global Investors; data as per 31.05.2015. Past performance is not a reliable indicator of future results.

5,3 4,6 5 Years p.a.

Volatility 5,2 6,0 Inception 23

For institutions and professional investors only.

Discovery Europe Strategy European Equity Long/Short Market Neutral

Allianz Discovery Europe (Cayman 06/07-10/09) (UCITS III 10/09-current)

2007 2008 2009 2010 2011 2012 2013 2014 2015 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Year

0.59% 0.77% 4.54% 0.23% 0.96% -0.98% 0.42%

6.62%

1.71% 2.47% -1.15% 0.48% -0.71% 0.23% 1.62% 2.54% -4.46% -3.80% 1.76% 1.22%

1.62%

1.10% -0.86% 7.34% 3.45% 1.36% -0.82% -2.98% 2.39% 1.02% -0.28% -0.34% 1.00%

12.70%

0.65% -0.36% -1.13% -0.28% -3.74% -1.94% 1.05% -1.70% -0.09% 2.15% 0.76% 2.90%

-1.89%

-0.98% 1.58% 0.94% -1.24% 0.92% -1.81% 1.81% -1.27% -0.10% 2.49% 0.10% 1.08%

3.46%

3.57% 0.51% 0.42% 1.63% -1.36% -0.45% 1.86% -0.05% 0.11% 1.80% 1.19% 0.35%

9.91%

0.89% 0.02% -0.79% -1.59% 1.56% -1.30% 1.49% 1.26% 1.19% 0.15% 0.46% 1.05%

4.42%

0.79% 1.18% 1.42% -1.31% -0.22% 1.18% -0.78% 0.12% 0.91% -0.28% -2.24% -0.64%

0.06%

-0.99% 1.90% -0.52% 2.86% 2.37% 1.00% Source: IDS. All Data in EUR as of 30.06.2015, EUR, net-of-fees. Allianz RCM Discovery Europe (Cayman) A EUR from 2007.06 to 2009.10 / Allianz Discovery Europe Strategy I EUR after 2009.10. Past performance is not a reliable indicator of future results.

For institutions and professional investors only.

Market Cap Breakdown Allianz Discovery Europe Strategy

100 80 60 40 20 0 -20 -40 -60 -80 -100 Long - Mega Cap Short - Mega Cap Long - Large Cap Short - Large Cap Long - Mid Cap Short - Mid Cap Investment convictions are built across the full market cap spectrum Long - Small Cap Short - Small Cap Source: IDS, as at 31.03.2015. Portfolio information is based on Allianz Discovery Europe Strategy. The information above is provided for illustrative purposes only to demonstrate the fund’s/portfolio’s investment strategy, it should not be considered a recommendation to purchase or sell any particular security or strategy or investment advice. Past performance is no guarantee of future results. Small cap = mkt cap below USD 2 bn; Mid cap = mkt cap between USD 2 bn and USD 10 bn; Large cap = mkt cap over USD 10 bn.

For institutions and professional investors only.

Gross and Net Market Exposure Allianz Discovery Europe Strategy

180 160 140 120 100 80 60 40 20 0 25 20 15 10 5 0 -5 -10 Gross Exposure (long+short) - LHS Net Exposure (Long-Short - RHS) Our market neutral strategy targets a net market exposure within the limits of +/-15% Source: IDS, as at 29.05.2015. Portfolio information is based on Allianz Discovery Europe Strategy. The information above is provided for illustrative purposes only to demonstrate the fund’s/portfolio’s investment strategy, it should not be considered a recommendation to purchase or sell any particular security or strategy or investment advice. Gross exposure equals the sum of absolute value of total long and short exposure; net exposure equals the difference between the absolute value of long and short exposure.

For institutions and professional investors only.

Allianz Discovery Europe (Recent Portfolio) Sample Daily Internal Risk Reporting

Risk measures - guidelines

Predicted volatility annualized* (5% -- 9%) Predicted Beta vs MSCI Europe Index* ( +/-0.20) Leverage ( < 170%) Equities net exposure ( +/-15%) Predicted volatility annualised*** (< 50% of MSCI Europe Index) Number of stocks (60 -- 130)

5.22% 0.11

157.20% 9.05% 6.7% ( 18.8%) 129

Max net Sector exposure ( +/-12%) Max net Country exposure ( +/-15%) Max long security exposure ( < 3.5%) Max short security exposure ( > -3.5%) Max VaR contribution ( < 10%) Consumer Discretionary France Intesa Sanpaolo S.P.A.

Glaxosmithkline Dialog Semiconductor ( 2.5%) GREEN as long as the measure below 97.5% of the guidline threshold, YELLOW as long as the measure between 97.5% and 100% of the guideline threshold, RED (except for Net Sector Exposure: GREEN below 10%, YELLOW between 10% and 12% and RED else) as long as out of the guideline region

10.66% -9.26% 3.14% -3.00% 9.06% Risk measures

Volatility annualized** Predicted volatility Dow Jones StoXX 50 annualized* VaR 95% in EUR 10 days* VaR 99% in EUR 10 days* 4.23% 13.67% 5,096,740 7,184,858 1.69% of total market value 2.38% of total market value Beta vs MSCI Europe Index** 0.03

*) VaR and volatility is based on Wilshire Atlas equally weighted covariance variance factor matrix with estimation period of 500 days **) based on rolling 60 days of returns in EUR ***) Volatility is based on Wilshire Atlas expnential weighted covariance variance factor matrix with estimation period of 550 days and decay factor 0.94

Stock

Top 6 long contributors to VaR 95%

Dialog Semiconductor

# long stocks:

Mkt Value (in 000 EUR) 7,433

Component VaR 461,918 Component VaR in % 9.06% Intesa Sanpaolo S.P.A.

Mediobanca Di Credito F Koninklijke Kpn Nv Ams Ag Actelion Limited 9,476 7,032 7,408 5,971 8,914 391,253 388,142 354,490 329,051 270,892 7.68% 7.62% 6.96% 6.46% 5.31% Strategy N.A.

N.A.

PAIR N.A.

N.A.

position 2.46% 3.14% 2.33% 2.46% 1.98% 2.96%

Top 6 short contributors to VaR 95%

Stock Glaxosmithkline Danone Nestle Sa L''oreal Verbund (Oest Elektrizi Fresenius Se&Co Kgaa

# short stocks:

Mkt Value (in 000 EUR) -9,047 -3,691 -3,279 -2,337 -1,526 -1,995

Component VaR 6,158 -2,984 -6,715 -7,957 -9,562 -11,526 Component VaR in % 0.12% -0.06% -0.13% -0.16% -0.19% -0.23% Strategy N.A.

N.A.

position -3.00% -1.22% -1.09% -0.77% -0.51% -0.66% Source: IDS, February 2015. This is not a recommendation or solicitation to buy or sell any particular security. This is for guidance only and not indicative of future allocation.

For institutions and professional investors only.

Allianz Discovery Europe (Recent Portfolio) Sample Daily Internal Risk Reporting

Exposures in %

short long Consumer Discretionary Consumer Staples Energy Financials Health Care Industrials Information Technology Materials Telecom Services Utilities -15 -10 -5 0 5 10 15 20 short long -30 Austria Belgium Denmark Finland France Germany Greece Ireland Italy Netherlands Norway Portugal Spain Sweden Switzerland United Kingdom -20 -10 net gross Consumer Discretionary Consumer Staples Energy Financials Health Care Industrials Information Technology Materials Telecom Services Utilities -10 0 10 20 0 10 20 30 short long mega cap (>= 20 bn EUR) large cap (>= 5 bn EUR, < 20 bn EUR) mid cap (>= 1 bn EUR, < 5 bn EUR) small cap (< 1 bn EUR) -60 -40 -20 0 20 40 30 net gross -20 Austria Belgium Denmark Finland France Germany Greece Ireland Italy Netherlands Norway Portugal Spain Sweden Switzerland United Kingdom -10 0 10 20 30 40 50 60 net gross mega cap (>= 20 bn EUR) large cap (>= 5 bn EUR, < 20 bn EUR) mid cap (>= 1 bn EUR, < 5 bn EUR) small cap (< 1 bn EUR) -40 -20 0 20 40 60 80 Source: IDS, February 2015. This is for guidance only and not indicative of future allocation.

For institutions and professional investors only.

Allianz Discovery Europe (Recent Portfolio) Sample Daily Internal Risk Reporting

Performance and Risk* Portfolio descriptives in mill EUR

Portfolio total Equities net exposure Cash Long market value equities Short market value equities 301.62

27.28

274.34

250.71

-223.43

9.05% of total market value 90.95% of total market value 83.12% of total market value -74.08% of total market value

Fund statistics last 20 days

Beta vs: Dow Jones EuroStoXX 0.09

Volatility annualised # days negative returns 4.00% 8 MSCI Europe Index Long beta vs MSCI Europe Index Short beta vs MSCI Europe Index 0.09

0.84

0.88

# days positive returns

Fund statistics since inception (26/10/2009)

Beta vs: Dow Jones EuroStoXX MSCI Europe Index 0.08

0.11

Volatility annualised # days negative returns # days positive returns 12 4.91% 645 748 Source: IDS, February 2015. This is for guidance only and not indicative of future allocation.

For institutions and professional investors only.

Allianz Discovery Europe Strategy – I – EUR

ISIN (I EUR) WKN (I EUR) Benchmark Launch date Currency Financial year-end LU0384030010 A0Q835 EONIA 20 October 2009 (SICAV) EUR 30 September Appropriation of income Distributing Fund price fixing Front-end load in % Daily Currently 0.00 (max. 2.00) Management fee in % p.a.

Currently 1.00 (max. 1.25) Performance fee 20% above EONIA, with high-water mark Share classes available:

Fund Class I € Fund Class A € Fund Class P € Fund Class WT € Fund Class PT CHF Fund Class IT SEK

Total AUM: 356.9 million EUR

Assets under Management as at 30.06.2015.

Allianz Discovery Germany Strategy – I – EUR

ISIN (I EUR) WKN (I EUR) Benchmark Launch date Currency Financial year-end Appropriation of income LU0639174274 A1JB15 EONIA 4 October 2011 EUR 30 September Distributing Fund price fixing Front-end load in % Weekly Currently 0.00 (max. 2.00) Management fee in % p.a.

Currently 1.00 (max. 1.25) Performance fee 20% above EONIA, with high-water mark Share classes available:

Fund Class I € Fund Class P €

Total AUM: 189.1 million EUR

For institutions and professional investors only.

How do the Equity Swaps work?

An exchange of cash flows between two parties that allows each party to diversify its income, while still holding its original assets.

AllianzGI Discovery Fund Management Team

Broker

Initiates equity trades according to Discovery Long / Short Strategy Give up trades

Luxembourg Bank Custody Account

Approx. 95% of client’s money kept separate in a bank custody account held in money market-oriented portfolio Payment to prime broker - swap fees and financing costs Performance of equity trades (long & short) Daily settlement of portfolio’s positive or negative performance

 Approx. 5% cash collateral provided to Swap Counterpart, which is transferred to different third party banks under the UK Client Money Protection regime to diversify counterparty risk.

SWAP Counterparty

 This structure minimises counterparty risk because counterparty risk is limited to the daily gain or loss of the portfolio.

 This structure allows us to run the market neutral strategy within the UCITS framework.

Allianz Discovery Germany Strategy

For institutions and professional investors only.

Allianz Discovery Germany Strategy Cumulative performance since inception (net of fees)

25,00 20,00 15,00 10,00 5,00 0,00 -5,00

Annual Data

2015 YTD 2014 2013 2012 2011 (Inception)

Fund

5.44% 2.43% 7.75% 7.37% -0.16%

Volatility

n.a.

3.15% 1.56% 1.93% n.a.

Source: Allianz Global Investors, IDS GmbH; data as per 31.05.2015. Past performance is not a reliable indicator of future results.

For institutions and professional investors only.

Allianz Discovery Germany Strategy Annualised Performance (net of fees)

03 02 01 00 07 06 05 04 4,2 N/A Year-to-date 5,9 Return 1 Year 3,2 Source: IDS; data as per 31.05.2015. Past performance is not a guide to future results.

6,2 2,5 6,0 2,4 3 Years p.a.

Volatility Inception p.a.

For institutions and professional investors only.

Discovery Germany Strategy Equity Long/Short Market Neutral

2011 2012 2013 2014 2015 Jan

0.74

0.18

1.02

0.7

Feb Mar Apr May Jun Jul

0.96

1.64

1.01

1.22

1.34

0.38

0.28

-0.48

0.23

0.30

-0.71

1.50

-0.15

0.90

-0.81

1.20

-0.22

0.44

0.52

0.47

0.42

-1.24

1.20

Aug Sep

0.42

1.39

0.16

0.56

1.21

-0.03

Oct

1.41

0.12

Nov

-0.43

Dec

0.27

Year -0.16%

1.42

0.43

0.80

-1.02

0.32

7.37%

0.69

7.75%

1.51

2.43%

Source: IDS. All Data in EUR as of 30.06.2015; net of fees. Past performance is not a reliable indicator of future results.

For institutions and professional investors only.

Allianz Discovery Germany Strategy Investment Process: Stock Examples

Recent Positions Longs

 Adidas  Daimler  Drillisch  Patrizia  Sartorius

Shorts

 Siemens  Deutsche Post  ElringKlinger  Deutsche Lufthansa  RWE Source: AllianzGI; data as per 31.05.2015. This is no recommendation or solicitation to buy or sell any particular security.

For institutions and professional investors only.

Market Cap Breakdown Allianz Discovery Germany Strategy

Investment convictions are build across the full market cap spectrum Source: IDS, as at 31.03.2015. Portfolio information is based on Allianz Discovery Germany. The information above is provided for illustrative purposes only to demonstrate the fund’s/portfolio’s investment strategy, it should not be considered a recommendation to purchase or sell any particular security or strategy or investment advice. Past performance is no guarantee of future results. Small cap = mkt cap below USD 2 bn; Mid cap = mkt cap between USD 2 bn and USD 10 bn; Large cap = mkt cap over USD 10 bn.

For institutions and professional investors only.

Gross and Net Market Exposure Allianz Discovery Germany Strategy

180 160 140 120 % 100 80 60 40 20 0 Dec-11 Sep-12 Jun-13 Gross Exposure (long + short) - LHS Mar-14 Net Exposure (Long-short) - RHS Dec-14 Our market neutral strategy targets a net market exposure within the limits of +/-15% 5 0 -5 30 25 20 15 10 % Source: IDS, as at 31.03.2015. Portfolio information is based on Allianz Discovery Germany Strategy. The information above is provided for illustrative purposes only to demonstrate the fund’s/portfolio’s investment strategy, it should not be considered a recommendation to purchase or sell any particular security or strategy or investment advice. Gross exposure equals the sum of absolute value of total long and short exposure; net exposure equals the difference between the absolute value of long and short exposure.

For institutions and professional investors only.

Allianz Discovery Germany Strategy Risk Management

Value at Risk 1 < 12% Portfolio Beta 2 < 0.3

Volatility 3 5-10%

Expected Parameters

Sector Exposure Country Exposure Maximum Leverage 4 Maximum Single stock weightings Maximum Net Exposure 5 + 15 / -15% Non-German Gross Exposure <25% 2 times +5 / -5% + 15 / -15% Daily monitoring of the risk parameters through an independent risk management team contributes to the success of the strategy 6 1 The Value at Risk reflects the maximum loss in a given period with a certain confidence level of X %. Under the investment strategy, the Value at Risk of any individual position should not contribute more than 10 % to the total Value at Risk. This is the Value at Risk with a confidence level of 95 % for a 10-day period, which is forecast ex ante on the basis of the Wilshire Atlas covariance factor matrix (equal weights) for a period of 500 days.

4 Leverage is the extent to which the investment strategy creates an exposure to assets which exceeds the fund volume. The leverage is usually financed by loans.

6 There is no guarantee that the target parameters are reached.

For institutions and professional investors only.

Fund Manager - Curriculum Vitae

Harald Sporleder

Lead Portfolio Manager, Discovery Europe | Co-Portfolio Manager, Discovery Germany

Facts

Year of joining company/group Number of years with company/group Number of years industry experience 1996 19 19

Employment History

10/2007 – today 11/1996 – today

Academic Qualification

1996 Lead Portfolio Manager, European Long/Short Equities Allianz Global Investors Degree, Economics Universität Halle-Wittenberg, Germany

Additional Qualification

2000 Executive Programme of Dresdner Kleinwort Wasserstein INSEAD Fontainebleau Citywire rating as of 30.06.2015. A ranking, a rating or an award provides no indicator of future performance and is not constant over time.

For institutions and professional investors only.

Fund Manager - Curriculum Vitae

Ralf Walter

Lead Portfolio Manager, Discovery Germany | Co-Portfolio Manager, Discovery Europe

Facts

Year of joining company/group Number of years with company/group Number of years industry experience 1998 17 17

Employment History

04/2009 – today 01/2001 – 03/2009 07/1998 – 12/2000 AllianzGI European Equities Portfolio management Cominvest Asset Management Senior Portfolio Manager, European Equities ADIG Investment Research – European Mid/Small Caps

Academic Qualification

1998 Degree, Business Studies University of Hoffenheim

Additional Qualification

2001 2000 CFA, Chartered Financial Analyst DVFA-/CEFA- Financial Analyst 41

For institutions and professional investors only.

Fund Manager - Curriculum Vitae

Steffen Weyl

Co-Portfolio Manager, Discovery Europe & Germany

Facts

Year of joining company/group Number of years with company/group Number of years industry experience 2008 7 7

Employment History

09/2008 – today Previous AllianzGI European Equities Portfolio Management Various Equity Reseach related internships including Bear Stearns, JPM Cazenove, Landesbank Rheinland-Pfalz

Academic Qualification

2008 Masters, Finance Johannes Gutenberg University, Mainz

Additional Qualification

2013 CFA, Chartered Financial Analyst 42

For institutions and professional investors only.

Composite Disclaimer

Composite Description

The Europe Equity Long/Short Market Neutral Composite was set up in January 2009. It contains all accounts run according to the Europe Equity Long/Short Market Neutral Investment Process, holding long and short European Equity positions or employing derivatives reflecting similar return patterns. The investment process is based on a fundamental stock selection process using proprietary (Allianz Global Investor’s Global Research Platform and Grassroots) and other research. The investment process incorporates a risk management process to achieve low volatility, and a limited beta operating with a low net market exposure.

Composite Benchmark: none

The fund incorporates a total return target net of fees.

Calculation Methodology

The composite performance results are time weighted, net of trading commissions and other transaction costs. AllianzGI Group consistently values all portfolios at least monthly. Securities within portfolios, contributing to this composite, are accounted for when confirmed, generally trade date plus one day. The dispersion of annual returns is measured by the standard deviation across asset-weighted portfolio returns represented within the composite for the full year.

Leverage and Hedging

A leverage of <=200% is used for this composite.

Additional Comments

Will be filled if applicable 43

For institutions and professional investors only.

Allianz Discovery Europe Strategy Disclaimer

Investing involves risk. The value of an investment and the income from it may fall as well as rise and investors might not get back the full amount invested.

The volatility of fund unit prices may be increased or even strongly increased. Past performance is not a reliable indicator of future results. If the currency in which the past performance is displayed differs from the currency of the country in which the investor resides, then the investor should be aware that due to the exchange rate fluctuations the performance shown may be higher or lower if converted into the investor’s local currency.

This is for information only and not to be construed as a solicitation or an invitation to make an offer, to conclude a contract, or to buy or sell any securities. The products or securities described herein may not be available for sale in all jurisdictions or to certain categories of investors. This is for distribution only as permitted by applicable law and in particular not available to residents and/or nationals of the USA. The investment opportunities described herein do not take into account the specific investment objectives, financial situation, knowledge, experience or specific needs of any particular person and are not guaranteed. The views and opinions expressed herein, which are subject to change without notice, are those of the issuer companies at the time of publication. The data used is derived from various sources, and assumed to be correct and reliable, but it has not been independently verified; its accuracy or completeness is not guaranteed and no liability is assumed for any direct or consequential losses arising from its use, unless caused by gross negligence or wilful misconduct. The conditions of any underlying offer or contract that may have been, or will be, made or concluded, shall prevail.

For a free copy of the sales prospectus, incorporation documents, daily fund prices, key investor information, latest annual and semi-annual financial reports, contact the management company at the address indicated below or www.allianzgi-regulatory.eu. Please read these documents, which are solely binding, carefully before investing.

This is a marketing communication issued by Allianz Global Investors GmbH, www.allianzgi.com, an investment company with limited liability, incorporated in Germany, with its registered office at Bockenheimer Landstrasse 42-44, 60323 Frankfurt/M, registered with the local court Frankfurt/M under HRB 9340, authorised by Bundesanstalt für Finanzdienstleistungsaufsicht (www.bafin.de).

The duplication, publication, or transmission of the contents, irrespective of the form, is not permitted.