Meet our investment managers: Part three – Columbia Threadneedle Investments

2025-09-09 15:18:05

From right here in New Zealand, investors can connect with global markets and benefit from world-class expertise. It’s common for managed funds like KiwiSaver to invest in a wide range of assets both locally and overseas. The BNZ KiwiSaver Scheme and YouWealth are managed by BNZ Investment Services Limited (BNZISL). BNZISL is responsible for looking after your investments, which includes selecting and monitoring global and domestic investment managers (referred to as underlying managers).

In part three of this series ‘Meet our investment managers’ we’re going to put the spotlight on Threadneedle Asset Management Limited (Columbia Threadneedle Investments), who are responsible for the active component of international fixed interest assets. More specifically, they manage a portfolio of global corporate bonds on BNZISL’s behalf, aiming to strike the right balance between risk and return.

Who is Columbia Threadneedle Investments?

Columbia Threadneedle Investments is a leading global asset manager, entrusted with US$654bn assets under management¹on behalf of individual, institutional and corporate clients around the world. With approximately 2,300 employees including 550 investment professionals based in North America, Europe and Asia², Columbia Threadneedle Investments offers a wide range of strategies across equities, fixed income and alternatives, as well as specialist responsible investment capabilities and a comprehensive suite of solutions. Columbia Threadneedle Investments is the global asset management group of Ameriprise Financial, Inc. (NYSE:AMP), a leading US-based financial services provider. As part of Ameriprise, they are supported by a large and well-capitalised diversified financial services firm.

Specifically within the fixed income space, Columbia Threadneedle Investments offers a full spectrum of solutions, covering traditional asset classes of investment grade credit, high yield credit and government bonds. It also covers more specialist areas including emerging market debt, securitised credit and social impact bonds. At the heart of their fixed income capability is a substantial global research platform, resourced to provide a balance between detailed due diligence of issuers and a clear vision of market and sector trends. Credit selection is key, with research experts conducting exclusive, in-depth company research and sharing insights to achieve better outcomes for their clients.

Diversifying assets and locations

Investing in a range of global markets helps to diversify a portfolio, which can help reduce the overall impact of market volatility. By spreading investments across multiple asset classes, industries, and geographic regions, you can reduce the impact of any single asset's poor performance.

Asset classes are different types of investments, for example shares, bonds, and cash. While the share market often gets a lot of attention, fixed interest assets are a common addition to a diversified investment strategy. Many of the BNZ KiwiSaver Scheme and YouWealth funds have an allocation to fixed interest assets, which is split into the NZ fixed interest and international fixed interest asset classes. The NZ fixed interest asset class is managed locally by Harbour Asset Management Limited – you can find out more inPart One of this series.

More about bonds and debt securities

A bond is a type of fixed-income investment where an investor lends money to a government, corporation, or other organisation (the issuer) for a set period of time in exchange for regular interest payments. When the bond reaches its maturity date, the issuer repays the original amount (the principal) to the investor. For example,if you buy a 5-year government bond for $100,000 with a 4% annual interest rate, the government will pay you $4,000 at the end of each year for five years and then return your $100,000 at the end.

Bonds are generally considered lower-risk investments compared to shares, as they provide predictable income and return of capital, but their value can fluctuate based on interest rates, inflation, and the creditworthiness of the issuer.

What is international fixed interest?

International fixed interest assets are bonds or other debt securities issued by governments, corporations, or organisations outside of New Zealand. Generally, the BNZISL's investment products include fixed interest securities from US, Europe, UK, Japan, and other developed and emerging markets.These assets provide regular interest payments during their term and return the principal at maturity, offering a relatively low-volatility investment option.

Benefits of international fixed interest assets

Including international fixed interest assets alongside local fixed interest assets can help diversify a portfolio by reducing reliance on domestic markets and providing exposure to different economic conditions and interest rate environments. Investors in international fixed interest assets may benefit from opportunities in global markets, but they also face risks such as geopolitical uncertainty and changes in interest rates that can impact returns. Many managed funds and KiwiSaver schemes include international fixed interest investments to enhance diversification and help manage risk, all while aiming for steady, long-term growth.

Partnering with experienced global managers allows BNZISL to tap into world-class expertise, research, and on-the-ground insights from markets around the world. This global perspective helps to build well-diversified investment products that can adapt to shifting economic conditions, interest rate changes, and evolving market trends.