Prudential Long Dated Corporate Bond S3
Performance
Discrete performance - to latest available quarter end
| 30/09/19 to 30/09/20 |
30/09/20 to 30/09/21 |
30/09/21 to 30/09/22 |
30/09/22 to 30/09/23 |
30/09/23 to 30/09/24 |
|
|---|---|---|---|---|---|
| Fund | 8.9% | -3.3% | -35.0% | 1.3% | 13.6% |
| Benchmark | 6.2% | -2.7% | -37.1% | 2.8% | 12.4% |
Performance - to latest available quarter end
| Quarter | Annualised | |||
|---|---|---|---|---|
| 3 2024 |
3 Years to 30/09/24 |
5 Years to 30/09/24 |
10 Years to 30/09/24 |
|
| Fund | 2.1% | -9.2% | -4.7% | 2.2% |
| Benchmark | 1.7% | -10.1% | -5.6% | 1.3% |
Top 10 Holdings
| Stock | % Weight |
|---|---|
| 1½% Treasury Gilt 2047 | 5.02 |
| 1¾% Treasury Gilt 2049 | 4.52 |
| ELECTRICITE DE FRANCE SA MTN RegS | 3.70 |
| 3¼% Treasury Gilt 2044 | 2.59 |
| 1¼ % Treasury Gilt 2041 | 2.51 |
| THFC FUNDING NO 3 PLC MTN RegS | 1.71 |
| SW (FINANCE) I PLC MTN RegS | 1.49 |
| HSBC HOLDINGS PLC MTN RegS | 1.36 |
| GDF SUEZ MTN RegS | 1.23 |
| MOTABILITY OPERATIONS GROUP PLC RegS | 1.20 |
| Total | 25.33 |
Fund Aims
Objective: The investment strategy of the fund is to purchase units in the M&G PP Long-Dated Corporate Bond Fund - the underlying fund.
Underlying Fund Objective: The fund invests mainly in high quality sterling corporate bonds with over 15 years to maturity. The fund is actively managed against its benchmark, the iBoxx sterling Over 15 Years Non-Gilts Index. The fund may also hold UK government gilts and limited amounts of high yield and hedged non-sterling corporate bonds. Derivative instruments may be used for efficient portfolio fund management.
Performance Objective: To outperform the benchmark by 0.80% a year (before charges) on a rolling three year basis.
Fund Manager
Jamie Hamilton joined Prudential Group in 2001 as a fund manager in the fixed income team managing a range of institutional corporate bond funds. Prior to joining M&G, Jamie worked for Dresdner RCM Global Investors as a fixed income fund manager, managing corporate bond funds. Jamie graduated from Newcastle University with a degree in economics and is a chartered financial analyst (CFA) charterholder.
n/a
Fund Overview
| Daily price (19/12/2024) | 265.20 |
| Fund size (31/10/2024) | £107.79m |
| Underlying Fund size | £945.97m |
| Number of holdings | 202 |
| Annual Management Charge (AMC) | Please refer to the "Fund Guide" for your specific pension plan |
| Launch date | 01/07/2003 |
Asset Allocation
| UK Corporate Bonds | 44.49% | |
| International Bonds | 33.66% | |
| UK Gilts | 16.45% | |
| Cash and Equivalents | 2.92% | |
| Alternative Trading Strategies | 0.00% | |
| Other Assets | 2.47% |
Commentary
Performance as at Q3 2024 - Within the span of 30 hours towards the end of July, three of the world's largest central banks – the Bank of Japan, US Federal Reserve (Fed), and the Bank of England (BoE) – all announced their eagerly-awaited interest rate decisions. In the UK, the BoE began its easing cycle with a 'hawkish' 25bps cut at the start of August and kept rates steady at 5% at the 19 September meeting. Markets are currently pricing in a further 140bps of cuts over the following 12 months as at the end of September 2024. In Japan, officials lifted rates to 0.25%, whereas in the US, Chair Powell signalled that a cut was possible as soon as September, but only if current cooling trends continued. In the weeks that followed, markets were dominated by the US '25 or 50' basis point rate cut debate which was finally settled in September with the first US rate cut of 50bps after 14 months of keeping rates on hold. With US Cpnsumer Prices Index (CPI) printing at 3.0% in July, its lowest level in over three years, weak jobs report data and unemployment rising from its low of 3.4% in April 2023 to 4.2% in August 2024, Fed officials made it clear they weren't prepared to tolerate further economic weakening, and were keen to move rates back to less restrictive levels. In Europe, the European Central Bank (ECB) held rates at their mid-July meeting however the remainder of the month saw weak Purchasing Manager Index (PMI) and inflation was a key theme throughout August with Germany’s CPI falling to +2.0% (the lowest since March 2021). This resulted in the ECB cutting rates by 25bps at their September meeting and fuelled investor confidence that they will keep cutting rates over the next few months at every meeting, rather than every other meeting. Looking ahead, despite hawkish communication from the Fed following the September cut (stressing this should not be seen as "the new pace" of easing), markets continue to price in a 35% chance of another 50bps reduction in November. The belief is that the Fed will be more aggressive, with c.70bps in cuts priced in by year-end and another 120bps priced in by the end of 2025. The '25 or 50' debate may not be over yet. Overall, the shift in investors' expectations for interest rates saw government bonds perform strongly over the quarter, with UK Gilts, US Treasuries, German Bunds and returning +2.5%, +4.8% and +3.2% respectively. Q3 24 also saw Sterling, US and European IG spreads marginally tighten by 1-4bps, with credit markets performing well as inflation softened and interest rates moved lower. Credit spreads tightened across most sectors, though the auto sector underperformed following various profit warnings which raised concerns over slowing growth. Sterling, US, European IG corporate spreads ended the quarter at 115bps, 92bps and 116bps respectively. Overall, Global IG returned 4.8%, with Sterling corporates with a more modest 2.6% total return, US corporates delivering 5.7%, European credit returning 3.3%. High Yield bonds were also supported by rate cuts and lower government bond yields, with Q3 seeing strong performance across High Yield markets. The Global HY index returned 4.9% over the quarter. Spreads tightened further, reaching historically low levels (US HY: 303bps, EU HY: 342bps), while CCC-rated distressed bonds posted solid gains. Gross issuance surged, particularly in the US, with $36.5bn raised. Market technicals remain supportive, driven by supply-demand imbalances and high carry. Year to date, Global HY has returned 8.42%, despite a year that began with concerns about recession risks.
Source: M&G
Important Information
Because of changes in exchange rates the value of your investment, as well as any money you take from it, can go down as well as up.
Some funds may invest in ‘underlying’ funds or other investment vehicles. The performance of our fund, compared to what it’s invested in won’t be exactly the same. That can be due to additional charges, cash management (needed to help people to enter and leave our fund when they want), tax and the timing of investments (this is known as a fund’s dealing cycle, it varies between managers and can be several days).
Source of portfolio data: Broadridge. Source of performance data: FE fundinfo. We can’t predict the future. Past performance isn’t a guide to future performance. The figures shown are intended only to demonstrate performance history of the fund, after allowing for the impact of fund charges and further costs, but take no account of any Annual Management Charge paid for by the deduction of units. Charges and further costs may vary in the future and may be higher than they are now. Fund performance is based upon the movement of the daily price and is shown as total return in GBP with gross income reinvested. The value of your client’s investment can go down as well as up and the amount your client gets back may be less than they put in.
This factsheet is intended for the advisers of occupational pension schemes using Prudential group pension contracts and Prudential grouped personal pensions and Stakeholder pension contracts. its purpose is to provide an insight into how investment markets and funds have performed over the period and is provided for information only. You should refer to your client's scheme documentation (e.g. Fund Guide) for fund availability, investment strategy, any scheme information and charges. Every care has been taken in populating this output, however it must be appreciated that neither Broadridge, Prudential nor their sources guarantee the accuracy, adequacy or completeness of this infomation or make any warranties regarding results from its usage.
Asset Allocation
| UK Corporate Bonds | 44.49% | |
| International Bonds | 33.66% | |
| UK Gilts | 16.45% | |
| Cash and Equivalents | 2.92% | |
| Alternative Trading Strategies | 0.00% | |
| Other Assets | 2.47% |
Bond Sector Breakdown
| Industry | Supersector | Sector | Subsector | ||
|---|---|---|---|---|---|
| Bonds | 94.60% | - | - | - | |
| Cash and Equivalents | 2.92% | - | - | - | |
| Non-Classified | 2.47% | - | - | - | |
| Alternative Trading Strategies | 0.00% | - | - | - | |
| Alternative Trading Strategies | - | 0.00% | - | - | |
| Alternative Trading Strategies | - | - | 0.00% | - | |
| Alternative Trading Strategies | - | - | - | 0.00% | |
Regional Allocation
| UK | 60.94% | |
| Developed Europe - Excl UK | 14.84% | |
| Non-Classified | 10.82% | |
| North America | 7.71% | |
| Cash and Equivalents | 2.92% | |
| South & Central America | 1.52% | |
| Australia & New Zealand | 0.97% | |
| Japan | 0.28% |
Fixed Interest Currencies
| Pound Sterling | 90.93% | |
| Cash | 2.92% | |
| US Dollar | 2.65% | |
| Non-Fixed Interest Assets | 2.47% | |
| Euro | 1.02% |
Regional Breakdown
| Region | Country | ||
|---|---|---|---|
| UK | 60.94% | - | |
United Kingdom
|
- | 60.94% | |
| Developed Europe - Excl UK | 14.84% | - | |
France
|
- | 9.13% | |
Netherlands
|
- | 1.50% | |
Luxembourg
|
- | 1.43% | |
Denmark
|
- | 1.29% | |
Sweden
|
- | 0.94% | |
Germany
|
- | 0.41% | |
Norway
|
- | 0.13% | |
| Non-Classified | 10.82% | - | |
| North America | 7.71% | - | |
United States
|
- | 7.71% | |
| Cash and Equivalents | 2.92% | - | |
| South & Central America | 1.52% | - | |
Mexico
|
- | 1.52% | |
| Australia & New Zealand | 0.97% | - | |
Australia
|
- | 0.97% | |
| Japan | 0.28% | - | |
Japan
|
- | 0.28% | |
Fixed Interest Maturity Profile
| < 5Yr Maturity |
|
0.72% |
| 5Yr - 10Yr Maturity |
|
0.29% |
| 10Yr - 15Yr Maturity |
|
5.26% |
| > 15Yr Maturity |
|
88.33% |
| Cash And Equivalents |
|
2.92% |
| Unknown Maturity |
|
2.47% |
Fixed Interest Quality Profile
| AAA |
|
1.12% |
| AA |
|
24.11% |
| A |
|
27.10% |
| BBB |
|
31.64% |
| Sub-Investment Grade |
|
1.06% |
| Unknown Quality |
|
9.58% |
| Cash and Equivalents |
|
2.92% |
| Other Asset Types |
|
2.47% |
Top 10 Holdings
| Stock | % Weight | Sector | Country | |
|---|---|---|---|---|
| 1 | 1½% Treasury Gilt 2047 | 5.02% | Bonds | United Kingdom |
| 2 | 1¾% Treasury Gilt 2049 | 4.52% | Bonds | United Kingdom |
| 3 | ELECTRICITE DE FRANCE SA MTN RegS | 3.70% | Bonds | France |
| 4 | 3¼% Treasury Gilt 2044 | 2.59% | Bonds | United Kingdom |
| 5 | 1¼ % Treasury Gilt 2041 | 2.51% | Bonds | United Kingdom |
| 6 | THFC FUNDING NO 3 PLC MTN RegS | 1.71% | Bonds | United Kingdom |
| 7 | SW (FINANCE) I PLC MTN RegS | 1.49% | Non-Classified | Non-Classified |
| 8 | HSBC HOLDINGS PLC MTN RegS | 1.36% | Bonds | United Kingdom |
| 9 | GDF SUEZ MTN RegS | 1.23% | Bonds | France |
| 10 | MOTABILITY OPERATIONS GROUP PLC RegS | 1.20% | Bonds | United Kingdom |
Important Information
Because of changes in exchange rates the value of your investment, as well as any money you take from it, can go down as well as up.
Some funds may invest in ‘underlying’ funds or other investment vehicles. The performance of our fund, compared to what it’s invested in won’t be exactly the same. That can be due to additional charges, cash management (needed to help people to enter and leave our fund when they want), tax and the timing of investments (this is known as a fund’s dealing cycle, it varies between managers and can be several days).
Identification Codes
| Sedol Code | 3373204 |
| Mex Code | PUMLDC |
| Isin Code | GB0033732040 |
| Citi Code | P551 |
Fund Charges
| Annual Management Charge (AMC) | Please refer to the "Fund Guide" for your specific pension plan |
Aims and Benchmark
| Aims | Objective: The investment strategy of the fund is to purchase units in the M&G PP Long-Dated Corporate Bond Fund - the underlying fund. Underlying Fund Objective: The fund invests mainly in high quality sterling corporate bonds with over 15 years to maturity. The fund is actively managed against its benchmark, the iBoxx sterling Over 15 Years Non-Gilts Index. The fund may also hold UK government gilts and limited amounts of high yield and hedged non-sterling corporate bonds. Derivative instruments may be used for efficient portfolio fund management. Performance Objective: To outperform the benchmark by 0.80% a year (before charges) on a rolling three year basis. |
| Benchmark | iBoxx Sterling Over 15 Years Non-Gilts Index |
| ABI Sector | Sterling Long Bond |
Important Information
Because of changes in exchange rates the value of your investment, as well as any money you take from it, can go down as well as up.
Some funds may invest in ‘underlying’ funds or other investment vehicles. The performance of our fund, compared to what it’s invested in won’t be exactly the same. That can be due to additional charges, cash management (needed to help people to enter and leave our fund when they want), tax and the timing of investments (this is known as a fund’s dealing cycle, it varies between managers and can be several days).
Risk Analysis
| Ratio | Value |
|---|---|
| Alpha | 3.29 |
| Beta | 1.00 |
| Sharpe | -0.02 |
| Standard Deviation | 16.20 |
| Info Ratio | 0.87 |
Risk Factors
| Risk Factor | Yes / No |
|---|---|
| Charges to Capital | Yes |
| Emerging Markets | No |
| Concentrated Portfolio | No |
| Smaller Companies | No |
| High Yield Bonds | Yes |
| Sector Specific | No |
| Geared Investments | No |
| Value of Investments | Yes |
| Investments Long Term | Yes |
| Property | No |
| Exchange Rate | No |
| Higher Risk | No |
| Performance Charges | No |
| Derivative Exposure | Yes |
| Offshore | No |
| Income Eroding Capital Growth | No |
| Umbrella Liabilities | No |
| New Fund | No |
| Solvency of Depository | Yes |
| Solvency of Bond Issuers | Yes |
| Ethical Restrictions | No |
| Liquidity | No |
| Returns Are Not Guaranteed | Yes |
| Inflation | Yes |
| Taxation and Tax Relief | Yes |
Fund Specific Risks
Charges to Capital
Part, or all of the periodic annual management fee(s) and expenses may be charged to capital which could increase the potential for the capital value of your investment to be eroded. Your capital could also decrease if income withdrawals exceed the growth rate of the fund(s).
High Yield Bonds
The fund invests in high yield bonds. High yield bonds carry a greater risk of default than investment grade bonds, and economic conditions and interest rate movements will have a greater effect on their price. Income levels may not be achieved and the income provided may vary.
Value of Investments
The value of investments, and any income can fall, as well as rise, so you could get back less than you invested. Neither capital nor income is guaranteed.
Investments Long Term
Investments should be regarded as long term and are not suitable for money which may be needed in the short term, you should always have a sufficient cash reserve.
Derivative Exposure
The fund invests in derivatives as part of its investment strategy, over and above their use for Efficient Portfolio Management (EPM). Investors should be aware that the use of these instruments can, under certain circumstances, increase the volatility and risk profile of the Fund beyond that expected of a fund that only invests in equities. The fund may also be exposed to the risk that the company issuing the derivative may not honour their obligations which in turn could lead to losses arising.
Solvency of Depository
The value of a cash or currency fund may be affected if any of the institutions with which cash is deposited becomes insolvent or experiences other financial difficulties.
Solvency of Bond Issuers
If the fund you choose invests in bonds there is a risk that the issuer may default, resulting in a loss to the portfolio.
Returns Are Not Guaranteed
What you receive when you sell your investment is not guaranteed; it depends on how your investments perform.
Inflation
Inflation will reduce the real value of your investments in future.
Taxation and Tax Relief
Levels of taxation and tax relief are subject to change.
Important Information
Because of changes in exchange rates the value of your investment, as well as any money you take from it, can go down as well as up.
Some funds may invest in ‘underlying’ funds or other investment vehicles. The performance of our fund, compared to what it’s invested in won’t be exactly the same. That can be due to additional charges, cash management (needed to help people to enter and leave our fund when they want), tax and the timing of investments (this is known as a fund’s dealing cycle, it varies between managers and can be several days).
The risk factor definitions are provided by Broadridge. These definitions may differ from those of Prudential or any underlying fund manager. The data itself is provided by Prudential or the underlying fund manager.
This factsheet is intended for the advisers of occupational pension schemes using Prudential group pension contracts and Prudential grouped personal pensions and Stakeholder pension contracts. its purpose is to provide an insight into how investment markets and funds have performed over the period and is provided for information only. You should refer to your client's scheme documentation (e.g. Fund Guide) for fund availability, investment strategy, any scheme information and charges. Every care has been taken in populating this output, however it must be appreciated that neither Broadridge, Prudential nor their sources guarantee the accuracy, adequacy or completeness of this infomation or make any warranties regarding results from its usage.
These risk ratings have been developed by Prudential to help provide an indication of a fund’s potential level of risk and reward based on the type of assets which may be held by the fund. Other companies may use different descriptions and as such these risk ratings should not be considered as generic across the fund management industry.
We regularly review our fund risk ratings, so they may change in the future. If, in our view, there is a material change in the fund's level of risk, for example due to a significant change to the assets held by the fund or in the way the fund is managed, we will provide information on the new risk rating. We recommend that you make sure you understand the risk rating of any fund before you invest.
Medium Risk
These funds may invest in multi-asset strategies with a higher weighting in equities (or with significant derivative use), while funds investing mainly in property, high yield or government bonds (such as UK Gilts) are also in this category.
Help
Important Information
Because of changes in exchange rates the value of your investment, as well as any money you take from it, can go down as well as up.
Some funds may invest in ‘underlying’ funds or other investment vehicles. The performance of our fund, compared to what it’s invested in won’t be exactly the same. That can be due to additional charges, cash management (needed to help people to enter and leave our fund when they want), tax and the timing of investments (this is known as a fund’s dealing cycle, it varies between managers and can be several days).
Source of performance data: FE fundinfo. We can’t predict the future. Past performance isn’t a guide to future performance. The figures shown are intended only to demonstrate performance history of the fund, after allowing for the impact of fund charges and further costs, but take no account of any Annual Management Charge paid for by the deduction of units. Charges and further costs may vary in the future and may be higher than they are now. Fund performance is based upon the movement of the daily price and is shown as total return in GBP with gross income reinvested. The value of your client’s investment can go down as well as up and the amount your client gets back may be less than they put in.
This factsheet is intended for the advisers of occupational pension schemes using Prudential group pension contracts and Prudential grouped personal pensions and Stakeholder pension contracts. Its purpose is to provide an insight into how investment markets and funds have performed over the period and is provided for information only. You should refer to your client's scheme documentation (e.g. Fund Guide) for fund availability, investment strategy, any scheme information and charges. Every care has been taken in populating this output, however it must be appreciated that neither Broadridge, Prudential nor their sources guarantee the accuracy, adequacy or completeness of this infomation or make any warranties regarding results from its usage.
Prudential is a trading name of Prudential Pensions Limited. Prudential Pensions Limited is registered in England and Wales. Registered office at 10 Fenchurch Avenue, London EC3M 5AG. Registered number 992726. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.