Prudential Long Dated Corporate Bond S3

Essentials Portfolio Analysis Background Data Prudential Risk Performance View PDF Factsheet
Portfolio data accurate as at:

Performance

Discrete performance - to latest available quarter end

30/09/15
to
30/09/16
30/09/16
to
30/09/17
30/09/17
to
30/09/18
30/09/18
to
30/09/19
30/09/19
to
30/09/20
Fund 27.6% -1.1% -1.3% 20.0% 8.9%
Benchmark 25.8% -2.7% -0.7% 19.3% 6.2%

Performance - to latest available quarter end

Quarter Annualised
3
2020
3 Years to
30/09/20
5 Years to
30/09/20
10 Years to
30/09/20
Fund 0.3% 8.9% 10.2% 9.0%
Benchmark 0.5% 7.9% 9.0% 8.1%

Top 10 Holdings

Stock % Weight
3¼% Treasury Gilt 2044 4.90
1½% Treasury Gilt 2047 3.93
ELECTRICITE DE FRANCE SA MTN RegS 3.07
THFC FUNDING NO 3 PLC MTN RegS 1.72
THAMES WATER UTIL FIN MTN RegS 1.49
GENERAL ELECTRIC CO MTN RegS 1.48
ENEL FINANCE INTERNATIONAL SA MTN RegS 1.32
PFIZER INC RegS 1.26
GDF SUEZ MTN RegS 1.26
RESEAU FERRE DE FRANCE MTN RegS 1.25
Total 21.68

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 manager of the underlying fund for 19 years and 10 months

Photo of Jamie Hamilton 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.

Mark Ellis manager of the underlying fund for 6 years and 9 months

Photo of Mark Ellis n/a

Fund Overview

Daily price (27/11/2020) 394.50
Fund size (30/09/2020) £151.90m
Underlying Fund size £1181.55m
Number of holdings 191
Annual Management Charge (AMC) Please refer to the "Fund Guide"
for your specific pension plan
Launch date 01/07/2003

Asset Allocation

pie chart
  UK Corporate Bonds 49.87%
  International Bonds 39.52%
  UK Gilts 9.93%
  Cash and Equivalents 0.67%

Performance comment

Performance as at Q2 2020 - The scale of the economic slump felt across the world has been substantial however. In the US, the unemployment rate leapt from below 4% in March, to more than 14% in April, as more than 20 million Americans lost their jobs. UK economic activity collapsed in April, the first full month of the country-wide lockdown, as GDP declined by 24.5% in that single month. That collapse followed a decline of 5.7% the previous month. While backward-looking data remains largely negative, reflecting the worst of the initial reactions to the pandemic’s spread, many forward-looking indicators, such as purchasing managers indices have recovered recently.

Government bonds have had two distinct influences on them. The economic disruption has created deflationary pressure which has suppressed yields, while the fiscal spending packages have led to ballooning public sector borrowing requirements, which ordinarily would be expected to drive yields higher. Overall, major market government yields ended the quarter largely unchanged.

Investors’ demand for corporate credit has expanded significantly following the dramatic setback in the latter part of the first quarter. The appetite for holding credit was propelled both by official support for markets, including those of sub-investment grade quality, and the appearance of attractive value opportunities as spreads widened to levels which appeared well beyond the worst case scenario for potential defaults. Consequently, credit spread premium levels have declined through the course of the second quarter, although not yet fully to pre-COVID levels. Some sectors most adversely affected by events, such as leisure, transportation, airlines and hotels for example, have yet to recover as strongly as others.

The pandemic has now become centred in the Americas, with the US experiencing a renewed upsurge of cases. After such a strong recovery in risk assets during the second quarter, the fund manager has become cautious about how much further credit spreads will be able to tighten. The fund manager believes that the unpredictability of how and where the effects of COVID-19 will be felt most means even areas typically perceived to be defensive during an economic slowdown, may not be invulnerable. Accordingly the fund manager retains their value-driven approach to markets, seeking to identify those opportunities that offer the most attractive value for the risks they carry.

Overall, having an overweight position in credit risk relative to the benchmark contributed positively to performance as spreads tightened during the quarter. Regarding sector selection, an overweight position relative to the benchmark in the Industrial and Financial sectors contributed positively to performance. The underweight position relative to the benchmark in the Quasi and Foreign Governments and Utility sectors were negative contributors to performance.

From a stock selection perspective, overweight positions relative to the benchmark in EDF and General Electric were positive selections. The detractors to performance included an underweight position relative to the benchmark in Northumbrian Water and National Grid.

Source: M&G

Important Information

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 investment can go down as well as up so you might get back less than you put in.

This factsheet is intended for the trustees, sponsors, advisers and members 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. If you are not familiar with any of the investment terminology included, then please contact an adviser. Investors should refer to their 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 information or make any warranties regarding results from its usage.

Portfolio data accurate as at:

Asset Allocation

pie chart
  UK Corporate Bonds 49.87%
  International Bonds 39.52%
  UK Gilts 9.93%
  Cash and Equivalents 0.67%

Bond Sector Breakdown

Expand allCollapse all
Industry Supersector Sector Subsector
 
Bonds 99.33% - - -
 
Cash and Equivalents 0.67% - - -
 
Non-Classified 0.00% - - -

Regional Allocation

pie chart
  UK 59.80%
  North America 16.57%
  Developed Europe - Excl UK 15.91%
  Non-Classified 4.24%
  South & Central America 1.80%
  Cash and Equivalents 0.67%
  Other Regions 1.01%

Fixed Interest Currencies

pie chart
  Pound Sterling 93.73%
  US Dollar 5.11%
  Cash 0.67%
  Euro 0.49%

Regional Breakdown

Expand allCollapse all
Region Country
 
UK 59.80% -
 
United Kingdom - 59.80%
 
North America 16.57% -
 
United States - 16.57%
 
Developed Europe - Excl UK 15.91% -
 
France - 7.56%
 
Netherlands - 4.17%
 
Luxembourg - 1.32%
 
Sweden - 0.87%
 
Ireland - 0.74%
 
Italy - 0.64%
 
Belgium - 0.62%
 
Non-Classified 4.24% -
 
South & Central America 1.80% -
 
Mexico - 1.80%
 
Cash and Equivalents 0.67% -
 
Australia & New Zealand 0.67% -
 
Australia - 0.67%
 
Japan 0.34% -
 
Japan - 0.34%

Fixed Interest Maturity Profile

< 5Yr Maturity
 
 
0.72%
5Yr - 10Yr Maturity
 
 
1.08%
10Yr - 15Yr Maturity
 
 
3.32%
> 15Yr Maturity
 
 
94.21%
Cash And Equivalents
 
 
0.67%

Fixed Interest Quality Profile

AAA
 
 
1.76%
AA
 
 
18.52%
A
 
 
33.30%
BBB
 
 
35.65%
Sub-Investment Grade
 
 
0.91%
Unknown Quality
 
 
9.18%
Cash and Equivalents
 
 
0.67%

Top 10 Holdings

Stock % Weight Sector Country
1 3¼% Treasury Gilt 2044 4.90% Bonds United Kingdom
2 1½% Treasury Gilt 2047 3.93% Bonds United Kingdom
3 ELECTRICITE DE FRANCE SA MTN RegS 3.07% Bonds France
4 THFC FUNDING NO 3 PLC MTN RegS 1.72% Bonds United Kingdom
5 THAMES WATER UTIL FIN MTN RegS 1.49% Bonds United Kingdom
6 GENERAL ELECTRIC CO MTN RegS 1.48% Bonds United States
7 ENEL FINANCE INTERNATIONAL SA MTN RegS 1.32% Bonds Luxembourg
8 PFIZER INC RegS 1.26% Bonds United States
9 GDF SUEZ MTN RegS 1.26% Bonds France
10 RESEAU FERRE DE FRANCE MTN RegS 1.25% Bonds France

Important Information

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

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).

Charges and further costs may vary in the future and may be higher than they are now.

This factsheet is for information purposes only. If there is information or terminology included that you would like to discuss, then please contact an adviser. Investors should refer to their policy documentation and supporting brochures for fund availability, investment strategy, any product 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 information 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.

You should also consider discussing your decision and the appropriateness of a fund's risk rating with an adviser.

  • Higher Risk
  • Medium to Higher Risk
  • Medium Risk
  • Lower to Medium Risk
  • Lower Risk
  • Minimal Risk

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

This factsheet is intended for the trustees, sponsors, advisers and members 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. If you are not familiar with any of the investment terminology included, then please contact an adviser. Investors should refer to their 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 information or make any warranties regarding results from its usage.

Important Information

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 investment can go down as well as up so you might get back less than you put in.

This factsheet is intended for the trustees, sponsors, advisers and members 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. If you are not familiar with any of the investment terminology included, then please contact an adviser. Investors should refer to their 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 information 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.