Quantitative Analysis and Risk Management

A dedicated quantitative analysis and risk management team is critical to our investment process by aligning portfolio exposures with our clients’ objectives.

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Our Risk Management Mission

  • We build market-leading risk management tools and provide novel and insightful advice to the portfolio management team.
  • We collaborate with the portfolio management team and the client advisory group to promote portfolio construction consistent with our clients' return expectations and risk preferences.
  • We educate our investment team, clients, and prospective investors regarding our risk management framework.

Distinctive Risk Management Framework

Our quantitative analysis and risk management team comprises approximately 20% of fixed income's total investment professionals.

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The Quantitative Analysis and Risk Management Team, along with the Portfolio Analysis Group, are located on the trading floor and work closely with the portfolio management teams.

We believe risk management is a core investment management function and should not be outsourced.

Elements of Our Risk Management System

INTEGRATED PERFORMANCE ATTRIBUTION SYSTEM

Reports Identify Where We Are Generating Alpha

  • Links specific alpha drivers to performance.

Permits Comprehensive Re-Evaluation of Risk Budget

  • Are we taking risk in the most effective areas?
  • Are we taking the right amounts of risk in each area?

No risk management technique can guarantee the mitigation or elimination of risk in any market environment.

Source: PGIM as of December 31, 2025.

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