PGIM Investments has entered the exchange-traded fund space with the launch of the PGIM Ultra Short Bond ETF (PULS), a diversified, fixed income, actively managed ETF that aims to deliver current income and capital appreciation with a focus on managing risk.
PGIM Investments is the worldwide distributor of retail products for PGIM, the investment management businesses of Prudential Financial.
“Investors are using a variety of investment vehicles to meet their needs,” says Stuart Parker, president and CEO of PGIM Investments. “The actively managed ETF market, while small, has seen steady growth. Entering this market is a natural next step to expand our product range.”
The first fund on the platform, the PGIM Ultra Short Bond ETF, is priced at 15 bps, making it among the most competitively priced active fixed income ETFs currently available, according to Morningstar data of 28 February 2018. Its risk-managed and short duration approach is designed to help investors hedge against rising rates and enhance or diversify a cash management strategy.
“We are very excited to launch our first active ETF fund and firmly believe that actively managed funds will be an important part of the ETF market going forward,” says Michael Lillard, head of PGIM Fixed Income and chief investment officer.
The fund will invest primarily in a portfolio of investment grade, US dollar-denominated short-term fixed, variable and floating-rate debt instruments.
PGIM Ultra Short Bond ETF is sub-advised by PGIM Fixed Income, one of the largest global fixed income managers in the world, with more than USD700 billion in assets under management as of 31 December, 2017.
The fund’s senior portfolio managers, Joseph D’Angelo and Douglas G Smith, who average 32 years of investment experience and 30 years with PGIM Fixed Income, managed USD45 billion in short-term strategies as of 31 December 2017. The team is supported by the deep resources and capabilities of PGIM Fixed Income, including 127 portfolio managers, 103 fundamental analysts, and 50 quantitative and risk managers.