Prudential High Yield Fund Highlights - PGIM Investments

0 downloads 249 Views 71KB Size Report
S&P 500 Index is a market-weighted index of 500 of the largest U.S. stocks in a ... Class Z overall rating out of 59
PGIM INVESTMENTS | Bringing you the investment managers of Prudential Financial, Inc.

FOCUSED ON SOLVING THREE INVESTOR CHALLENGES PRUDENTIAL HIGH YIELD FUND

The Prudential High Yield Fund provides a highly diversified exposure to high yield bonds, which can potentially provide higher income than many yield-oriented investments, help protect against rising interest rates, and could deliver competitive total returns with less risk than stocks.

EQUITY-LIKE RETURNS WITH LESS RISK High yield has provided 83% of the returns of the stock market with 56% of the risk, as measured by standard deviation.

LESS VOLATILE PART OF THE HIGH YIELD MARKET

DISTINCTIVE INVESTMENT PROCESS

The Fund’s current focus is on higherrated issuers (BB, B) with shorter durations. This part of the high yield market potentially offers attractive relative returns while limiting downside risk.

PGIM Fixed Income’s unique investment process, in which risk management, portfolio management, and credit research work together as equals, has helped deliver competitive returns while managing volatility.

MORNINGSTAR OVERALL RATINGTM

+++++

Class Z overall rating out of 601 High Yield Bond funds as of 9/30/2017. Morningstar measures riskadjusted returns. The overall rating is based on the Fund’s 3-, 5-, and 10-year star rating.

HIGH YIELD BONDS HAVE HISTORICALLY PROVIDED SIMILAR RETURNS TO STOCKS WITH LESS RISK RETURNS 9.04% Bloomberg Barclays U.S. Corporate High Yield Index 10.91% S&P 500 Index

RISK 8.31% Bloomberg Barclays U.S. Corporate High Yield Index 14.73% S&P 500 Index

Source: Calculated by PGIM, Imc. using data from Morningstar. All rights reserved. Used with permission. Time period is since the inception of the Bloomberg Barclays U.S. Corporate High Yield Index: 7/1/83–9/30/2017. Past performance does not guarantee future results. Standard deviation is the statistical measurement of dispersion that measures how widely a stock’s or portfolio’s returns varied over a certain period of time. S&P 500 Index is a market-weighted index of 500 of the largest U.S. stocks in a variety of industry sectors, providing a broad indication of price movement. Bloomberg Barclays U.S. Corporate High Yield Index measures the market of U.S.-dollar-denominated, non-investment-grade, fixed rate, taxable corporate bonds. Please note that the indexes used in these illustrations are unmanaged. Investors cannot invest directly in an index or average. ©2017 Morningstar, Inc. All rights reserved. The information contained herein (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

PRUDENTIAL HIGH YIELD FUND

A. PBHAX C: PRHCX Q: PHYQX R: JDYRX Z: PHYZX

All data as of 9/30/2017 unless noted otherwise.

8.8% Health Care & Pharmaceuticals 7.7% Technology 7.3% Telecom 6.6% Other Energy 6.5% Cable 6.1% Electric 5.6% Building Mateials & Construction 5.1% Capital Goods 4.6% Metals 4.4% Foods

1.0

0.4

1.8

-1.0 -3.4 -0.7

0.1

3.7% AAA 3.0% BBB 32.2% BB 45.1% B 11.9% CCC 1.6% Not Rated 2.5% Cash/Equiv

-0.1

0.7

Robert Cignarella, CFA 22 years of experience

Terence Wheat, CFA 24 years of experience

Robert Spano, CFA 20 years of experience

Ryan Kelly, CFA 21 years of experience

Brian Clapp, CFA 27 years of experience

Daniel Thorogood, CFA 21 years of experience

30-DAY SEC YIELD (%, CLASS Z) Subsidized Unsubsidized

LARGEST INDUSTRIES VS BENCHMARK 3.4

PORTFOLIO MANAGEMENT

CREDIT QUALITY (% OF ASSETS)

LARGEST INDUSTRIES (% OF ASSETS)

5.20 5.20

Yields change monthly. For additional yields and dividends, visit our website at pgiminvestments.com.

AVERAGE ANNUAL TOTAL RETURNS (%) Since Inception Inception Date

YTD

1-year

3-year

5-year

10-year

SEC Standardized Returns (Class Z)

7.30

8.83

6.23

6.48

7.66

6.69

3/01/1996

Bloomberg Barclays U.S. Corporate High Yield 1% Issuer Capped Index

6.94

8.83

5.81

6.35

7.85

7.32

2/29/1996

Past performance does not guarantee future results, and current performance may be lower or higher than the past performance GDWDTXRWHG7KHLQYHVWPHQWUHWXUQDQGSULQFLSDOYDOXHZLOOÞXFWXDWHDQGVKDUHVZKHQVROGPD\EHZRUWKPRUHRUOHVVWKDQ the original cost. For the most recent month-end performance, visit our website at pgiminvestments.com. Gross operating expenses: Class Z, 0.57%. Source: All data from PGIM, Inc. This is not a recommendation to buy or sell any securities listed. Allocations may vary, all data is unaudited and subject to change. Totals may not sum due to rounding. SEC standardized return describes the return to the investor after net operating expenses. All returns assume share price changes as well as the compounding effect of reinvested dividends and capital gains. Returns may reflect fee waivers and/or expense reimbursements. Without such, returns would be lower. All returns 1-year or less are cumulative. Credit quality is calculated using the highest rating assigned by a nationally recognized statistical rating organization (NRSRO) such as Moody’s, S&P, or Fitch. The Not Rated category consists of securities that have not been rated by an NRSRO. Class Z shares do not have sales charges and may be available to group retirement plans and institutional investors through certain retirement, mutual fund wrap and asset allocation programs and to institutions at an investment minimum of $5,000,000. Bloomberg Barclays U.S. Corporate High Yield 1% Issuers Capped Index is an unmanaged, issuer-constrained version of the Barclays U.S. Corporate High Yield Index that covers the U.S. dollar dominated, non-investment grade, fixed-rate, taxable corporate bond market. It follows the same construction rules as the uncapped index, but limits issuer exposure to a maximum 1% and redistributes the excess market value index-wide on a pro-rata basis. An investment cannot be made directly into an index. Source: Morningstar. The Fund’s Overall, 3-, 5-, and 10-year Star Ratings/Funds in Category are as follows: Class Z - 5/601, 5/601, 4/485 and 5/319, respectively. The Morningstar Rating for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

RISK INFORMATION—High yield (“junk”) bonds have greater credit and market risks; short sales have costs and potentially unlimited losses; leveraging may magnify losses; and derivatives have market, credit, and liquidity risks. Fixed income investments are subject to interest rate risk, and their value will decline as interest rates rise. These risks may result in greater share price volatility. There is no guarantee the Fund’s objective will be achieved. For more information, contact your financial professional or visit our website at pgiminvestments.com. Consider a fund’s investment objectives, risks, charges, and expenses carefully before investing. The prospectus and summary prospectus contain this and other LQIRUPDWLRQDERXWWKHIXQG&RQWDFW\RXUÝQDQFLDOSURIHVVLRQDOIRUDSURVSHFWXVDQGVXPPDU\SURVSHFWXV5HDGWKHPFDUHIXOO\EHIRUHLQYHVWLQJ Mutual funds are distributed by Prudential Investment Management Services LLC (PIMS) and member SIPC. PGIM Fixed Income is a unit of PGIM, a registered investment advisor. PIMS and PGIM are Prudential Financial companies. © 2017 Prudential Financial, Inc. and its related entities. PGIM and the PGIM logo are servicemarks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. This material is being provided for informational or educational purposes only and does not take into account the investment objectives or financial situation of any client or prospective clients. The information is not intended as investment advice and is not a recommendation about managing or investing your retirement savings. Clients seeking information regarding their particular investment needs should contact a financial professional. Mutual Funds | Are not insured by the FDIC or any federal government agency | May lose value | Are not a deposit of or guaranteed by any bank or any bank affiliate 0235546-00021-00 PI3556 Expiration: 1/31/2018