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Optimising asset allocation over the long term: how the PruFund range of funds is managed in order to remain an industry-leading solution to market volatility

With so much uncertainty prevailing across global markets as the world tries to readjust to living with the Covid virus, the benefits of a smoothed investment option for longer term investors who are keen to minimise the impact of market volatility on their capital are hard to overlook. 

As a leading provider of smoothed investment options, Pru’s PruFund fund range is invested in the Prudential With-Profits Fund, which is the largest and one of the financially strongest with-profits funds in the UK. It was worth approximately £117.9bn as at 31 December 2020.

How is it managed?

Pru believe that a well-diversified fund is more likely to achieve consistent returns for investors and that value can be added through a sound and well-structured investment process. This is why they use Prudential’s expert investment strategists at Treasury and Investment Office (T&IO) to make the strategic investment decisions within the PruFund multi-asset fund range.

Prudential’s investment strategist T&IO’s main objective is to ensure that they optimise the asset allocation of funds. This is core to their investment approach. Importantly, they regularly keep the asset allocation under control. To achieve the right mix of assets at any given time, they have a regular process of monitoring and adjusting the mix for any market or fund changes.

 The T&IO approach to asset allocation

Most financial professionals will agree that asset allocation is one of the most important decisions that investors make. To help inform their asset allocation decisions, T&IO analyses the information available to them on the performance of assets over both the long and the short term. They look backward at historical information and they also look forward to consider how each asset is likely to perform. And at the core of any long-term asset allocation decision is a process that has been in place – and successful – for nearly two decades Access to a global range of funds Investors have access to other high-quality M&G Group investment companies like M&G Investment Management and M&G Real Estate and a number of external fund managers.

Team-based approach

T&IO use a team-based approach to reach a consensus house view. As part of the M&G group, T&IO draws upon the experience of hundreds of investment professionals both in the UK and around the world. And these investment teams are supported by experienced information and risk monitoring teams. Governance framework Governance and controls are particularly important for T&IO, and as such they work within a thorough and effective governance framework, so that each part of the investment process is reviewed and controlled at all times.

Demonstrable success

PruFund Growth’s 17-year track record provides clear evidence of T&IO’s ability to produce investment returns that help meet investor expectations over long periods and through difficult market conditions. The scale and breadth of assets under management means that T&IO is often a preferred counterparty in the marketplace, able to negotiate competitive terms and ensure a premium service is always provided.

Please remember that past performance should not be considered a reliable indicator of future performance.

To find out more about PruFund, please click here

 

 

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