New fixed income ETFs build on success of $7B PGIM Ultra
Short Bond ETF (PULS) and PGIM’s existing retail municipal bond
strategies1
PGIM,2 the $1.34 trillion global investment management business
of Prudential Financial, Inc. (NYSE: PRU), has launched two new
actively managed exchange-traded funds (ETFs) — the PGIM Ultra
Short Municipal Bond ETF (PUSH) and the PGIM Municipal
Income Opportunities ETF (PMIO) — on the NYSE Arca.
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Stuart Parker, President and CEO, PGIM
Investments (Photo: Business Wire)
Both ETFs seek total return through a combination of current
income and capital appreciation by investing at least 80% of their
respective portfolios in municipal (“muni”) obligations whose
income is exempt from federal income taxes. The ETFs are subadvised
by PGIM Fixed Income, a top-10 U.S. active fixed income manager
with $821 billion in assets under management.3
“In addition to their diversification benefits, muni bond ETFs
offer an attractive opportunity for investors, particularly
high-net-worth investors, who may be looking to maximize tax
efficiency within their portfolios,” said Stuart Parker, president
and CEO of PGIM Investments. “We are thrilled to further expand
PGIM Fixed Income’s actively managed muni bond offerings in the
retail market.”
Jason Appleson, PGIM Fixed Income head of Municipal Bonds and
co-portfolio manager of the new ETFs, comments, “These new products
allow ETF investors to tap into PGIM Fixed Income’s muni expertise.
The PGIM Ultra Short Municipal Bond ETF (PUSH) is ideal for
investors looking to deploy cash into a more conservative strategy
while benefiting from tax efficiencies provided by the municipal
markets. The PGIM Municipal Income Opportunities ETF (PMIO) is
designed to have more credit and duration risk flexibility,
allowing us to select opportunities within the muni market.”
PGIM Ultra Short Municipal Bond ETF (PUSH)
PUSH is PGIM’s second ultra short ETF strategy, following
the success of the $7 billion PGIM Ultra Short Bond ETF
(PULS), and offering an additional alternative to
traditional cash management strategies. The ETF seeks to primarily
invest in investment-grade muni bonds and up to 10% in high yield
muni debt obligations. PUSH seeks to maintain a weighted average
portfolio duration of two years or less.
With a 0.15% net expense ratio, PUSH is the lowest-cost
active ETF in the Morningstar Short Muni category.4
PGIM Municipal Income Opportunities ETF (PMIO)
PMIO is a dynamic income opportunities strategy,
investing at least 70% of its portfolio in investment-grade muni
debt obligations and up to 30% in high yield muni debt obligations.
The ETF seeks to maintain a weighted average portfolio duration of
two to eight years. PGIM’s flexible approach allows the ETF to
allocate across credit qualities, maturities, sectors and states
based on where the portfolio management team sees what it believes
to be the most attractive opportunities. PMIO has a net expense
ratio of 0.25%.
Learn more about PGIM’s suite of 42 ETFs which spans fixed
income, equity, and multi-asset class solutions.
ABOUT PGIM INVESTMENTS PGIM Investments LLC and its
affiliates offer more than 100 funds globally across a broad
spectrum of asset classes and investment styles. All products draw
on PGIM’s globally diversified investment platform that encompasses
the expertise of managers across fixed income, equities,
alternatives, and real estate.
ABOUT PGIM FIXED INCOME PGIM Fixed Income, with $821
billion in assets under management as of March 31, 2024, is a
global asset manager offering active solutions across all fixed
income markets. The company has offices in Newark, N.J., London,
Amsterdam, Zurich, Munich, Singapore, Hong Kong, and Tokyo. For
more information, visit pgimfixedincome.com.
ABOUT PGIM PGIM is the global asset management business
of Prudential Financial, Inc. (PFI). PFI has a history that dates
back over 145 years and through more than 30 market cycles. With 41
offices in 19 different countries (as of March 31, 2024), our more
than 1,450 investment professionals are located in key financial
centers around the world.
Our firm comprises multi-managers that collaborate with each
other and specialize in a particular asset class with a focused
investment approach. This gives our clients diversified solutions
with global depth and scale across public and private asset
classes, including fixed income, equities, real estate, private
credit, and other alternatives. As a leading global asset manager
with $1.34 trillion in assets under management (as of March 31,
2024), PGIM is built on a foundation of strength, stability, and
disciplined risk management.
For more information, visit pgim.com.
Prudential Financial, Inc. (PFI) of the United States is not
affiliated in any manner with Prudential plc, incorporated in the
United Kingdom, or with Prudential Assurance Company, a subsidiary
of M&G plc, incorporated in the United Kingdom. For more
information, please visit news.prudential.com.
1 Source: PGIM Investments, AUM as of June 21, 2024.
2 The term PGIM as used in this announcement includes PGIM
Investments LLC, an indirect, wholly owned subsidiary of Prudential
Financial, Inc.
3 Morningstar Direct, as of April 30, 2024. Includes all active
taxable and tax-exempt U.S. Open-End Funds and ETFs.
4 Source: Morningstar as of June 24, 2024.
PGIM Ultra Short Municipal Bond ETF Fund Risk
Risks of investing in the fund include but are not limited to
the following: ETFs may trade at a premium or discount to net asset
value or lack an active trading market, may be less liquid and may
be subject to brokerage commission or other charges. The Fund may
be subject to authorized participant concentration risk, since the
Fund has a limited number of intermediaries that act as authorized
participants and none of these authorized participants are or will
be obligated to engage in creation or redemption transactions. To
the extent that these intermediaries exit the business or are
unable to or choose not to proceed with creation and/or redemption
orders with respect to the Fund and no other authorized participant
creates or redeems, shares of the Fund may trade at a discount to
NAV and possibly face trading halts and/or delisting. The Fund is
subject to debt obligations risk: debt obligations are subject to
credit risk, market risk and interest rate risk and may also be
subject to call and redemption risk, which is the risk that the
issue may call a bond held by the Fund before maturity and the Fund
may not be able to reinvest at the same rate; and municipal bonds
and notes risk, where the Fund's holdings, share price, yield and
total return may fluctuate in response to bond market movements and
municipal bond market movements. The Fund may purchase municipal
bonds that are insured to attempt to reduce credit risk, but does
not provide protection against market fluctuations. Municipal lease
obligations are typically not subject to the same voter approval
and debt limits as other municipal securities, may be less secure
as they are not obligations of the issuers, and may not have an
active market. High yield ("junk") bonds are subject to greater
credit and market risks. Variable and floating rate bonds are
subject to credit, market and interest rate risks, may have a
limited market, and may be subject to extended settlement periods.
Zero coupon bonds may experience greater volatility due to changes
in interest rates. The Fund is subject to new/small fund risk given
the fund’s recently commenced operations and limited operating
history. Derivatives may carry market, credit and liquidity risks.
Unlike other ETFs, the fund is subject to cash transaction risk as
it may effect creation and redemptions in cash or partially cash so
that the Fund may be less tax-efficient than an investment in an
ETF that distributes portfolio securities in-kind. All or a portion
of the Fund's dividends may be taken in account in determining the
federal alternative minimum tax for individuals and may have other
tax consequences. There is no guarantee the Fund's objective will
be achieved. Risks are more fully explained in the fund's
prospectus.
PGIM Municipal Income Opportunities ETF Fund Risk
Risks of investing in the fund include but are not limited to
the following: ETFs may trade at a premium or discount to
net asset value or lack an active trading market, may be less
liquid and may be subject to brokerage commission or other charges.
The Fund may be subject to authorized participant concentration
risk, since the Fund has a limited number of intermediaries that
act as authorized participants and none of these authorized
participants are or will be obligated to engage in creation or
redemption transactions. To the extent that these intermediaries
exit the business or are unable to or choose not to proceed with
creation and/or redemption orders with respect to the Fund and no
other authorized participant creates or redeems, shares of the Fund
may trade at a discount to NAV and possibly face trading halts
and/or delisting. The Fund is subject to debt obligations
risk: debt obligations are subject to credit risk, market
risk and interest rate risk and may also be subject to call
and redemption risk, which is the risk that the issue may call
a bond held by the Fund before maturity and the Fund may not be
able to reinvest at the same rate; and municipal bonds and notes
risk, where the Fund's holdings, share price, yield and total
return may fluctuate in response to bond market movements and
municipal bond market movements. The Fund may purchase municipal
bonds that are insured to attempt to reduce credit risk, but
does not provide protection against market fluctuations.
Municipal lease obligations are typically not subject to the
same voter approval and debt limits as other municipal securities,
may be less secure as they are not obligations of the issuers, and
may not have an active market. Fixed Income investments are subject
to credit, market, prepayment and interest rate risks, and
their value will decline as interest rates rise. High yield
("junk") bonds are subject to greater credit and market risks.
Variable and floating rate bonds are subject to credit,
market and interest rate risks, may have a limited market, and may
be subject to extended settlement periods. Zero coupon bonds
may experience greater volatility due to changes in interest rates.
The Fund is subject to new/small fund risk given the fund’s
recently commenced operations and limited operating history.
Derivatives may carry market, credit and liquidity risks.
Unlike other ETFs, the fund is subject to cash transaction risk as
it may effect creation and redemptions in cash or partially cash so
that the Fund may be less tax-efficient than an investment in an
ETF that distributes portfolio securities in-kind. All or a portion
of the Fund's dividends may be taken in account in determining the
federal alternative minimum tax for individuals and may have other
tax consequences. There is no guarantee the Fund's objective will
be achieved. Risks are more fully explained in the fund's
prospectus.
Consider a fund’s investment objectives, risks, charges and
expenses carefully before investing. The prospectus and summary
prospectus contain this and other information about the fund.
Contact your financial professional for a prospectus and summary
prospectus. Read them carefully before investing.
Investing in exchange traded funds (ETFs) involves risks. Some
ETFs have more risk than others. The investment return and
principal value will fluctuate, and shares when sold may be worth
more or less than the original cost, and it is possible to lose
money.
The Funds are actively managed ETFs and thus do not seek to
replicate the performance of a specified index. ETF shares are not
individually redeemable from the Funds. Shares may only be redeemed
directly from the Fund by Authorized Participants in Creation
Units.
Fixed income investments are subject to credit, market, and
interest rate risks (including duration risk and prepayment risk),
and their value will decline as interest rates rise; call and
redemption risk, where the issuer may call a bond held by the Funds
for redemption before it matures and the Funds may lose income;
liquidity risk, which exists when particular investments are
difficult to sell; and emerging markets risk, which exposes the
Funds to greater volatility and price declines.
Investment products are distributed by Prudential Investment
Management Services LLC, member FINRA and SIPC. PGIM Investments is
a registered investment advisor and investment manager. PGIM Fixed
Income is an affiliate of PGIM and Prudential Financial company. ©
2024 Prudential Financial, Inc. and its related entities. PGIM,
PGIM Investments, PGIM Fixed Income and the PGIM logo are service
marks of Prudential Financial, Inc. and its related entities,
registered in many jurisdictions worldwide.
Investment products are not insured by the FDIC or any
federal government agency, may lose value, and are not a deposit of
or guaranteed by any bank or any bank affiliate.
1081173-00001-00
CONNECT WITH US: Visit pgim.com
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version on businesswire.com: https://www.businesswire.com/news/home/20240628741017/en/
MEDIA CONTACT Kylie Scott +1 973 902 2503
kylie.scott@pgim.com
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