Emerging markets are staging a powerful comeback. After years of volatility and global uncertainty, they now benefit from a convergence of macroeconomic tailwinds, including falling interest rates, easing inflation, and a weaker U.S. dollar. These shifts are creating a more supportive environment for emerging market assets, many of which trade at compelling valuations.
In addition to positive cyclical forces, structural reforms, improved policy discipline, and stronger institutional frameworks are enhancing resilience across key regions. As a result, emerging market companies are positioned for faster earnings growth, with many now driving innovation and disruption in their respective industries. For investors seeking long-term diversification and growth, the case for investing in emerging markets has rarely been stronger.
Still, capturing these opportunities requires more than passive exposure. Emerging markets are inherently diverse and complex, with varying political, economic, and currency risks. That’s where a quantitative approach can offer a distinct edge.
The actively managed PGIM Quant Solutions Emerging Markets Equity Fund is designed to navigate this complexity with precision. By leveraging proprietary models and data-driven insights, the Fund systematically identifies mispriced securities across emerging market equities. The process goes beyond screening for value to also uncover patterns, trends, and signals that traditional approaches may overlook. Resulting insights enable PGIM to dynamically adjust exposures across regions and sectors.
Importantly, the quantitative approach also brings consistency and transparency to decision-making. In markets where information asymmetry and volatility can cloud judgment, a rules-based framework helps ensure that investment decisions are grounded in fundamentals and supported by robust data. This is especially critical in emerging markets, where dispersion across countries and issuers can be wide and agility is key to capturing related short-and long-term opportunities.
As investors reassess their global allocations amid shifting macro conditions, emerging markets warrant renewed attention. PGIM’s time-tested, quantitative approach offers a powerful toolkit for accessing growth in emerging markets with confidence, discipline, and adaptability.
The future of emerging markets is unfolding. Now is the time to engage.
References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities. The securities referenced may or may not be held in the portfolio at the time of publication and, if such securities are held, no representation is being made that such securities will continue to be held.
The views expressed herein are those of PGIM investment professionals at the time the comments were made, may not be reflective of their current opinions, and are subject to change without notice. Neither the information contained herein nor any opinion expressed shall be construed to constitute investment advice or an offer to sell or a solicitation to buy any securities mentioned herein. Neither PFI, its affiliates, nor their licensed sales professionals render tax or legal advice. Clients should consult with their attorney, accountant, and/or tax professional for advice concerning their particular situation. Certain information in this commentary has been obtained from sources believed to be reliable as of the date presented; however, we cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. The manager has no obligation to update any or all such information; nor do we make any express or implied warranties or representations as to the completeness or accuracy.
Any projections or forecasts presented herein are subject to change without notice. Actual data will vary and may not be reflected here. Projections and forecasts are subject to high levels of uncertainty. Accordingly, any projections or forecasts should be viewed as merely representative of a broad range of possible outcomes. Projections or forecasts are estimated based on assumptions, subject to significant revision, and may change materially as economic and market conditions change.
Risks
An investment in the Fund involves a high degree of risk, including the risk that the entire amount invested may be lost. The Fund is primarily designed to purchase certain investments, which will introduce significant risk to the Fund, including asset performance, price volatility, administrative and counterparty risk. The return may increase or decrease as a result of currency fluctuations. Also, the use of financial derivative instruments may result in increased gains or losses within the Fund. There is no guarantee that the Fund will achieve its investment objective. Prospective and existing investors should carefully consider the risks involved in an investment in the Fund. In addition to reading this document, prospective and existing investors should read the Company’s Prospectus, Supplement and Key Investor Information Document (the “KIID”) or Key Information Document (the “KID”) (collectively the "Fund Documents") and consult their own legal, tax and financial advisors about the risks of investing in the Fund. Investments are not guaranteed by PGIM, its affiliates, or any governmental agency.
Benchmark Risk: The Fund may be subject to market or other risks inherent in the asset class or securities market represented by a benchmark. The Fund's performance relative to that benchmark may be subject to wide variation depending on market conditions, or could move closely in line with that of the benchmark over certain periods. Even if the Fund achieves an excess return above the benchmark gross of fees, if the applicable fees and expenses exceed that excess return, investors should note that net performance would be less than the benchmark due to those fees and expenses.
Currency Risk: The value of investments in the Fund that are designated in a currency other than the base currency for the Fund may rise and fall due to exchange rate fluctuations.
Custodial Risk: Assets which are traded in markets where custodial and/or settlement systems are not fully developed may be exposed to risk in circumstances where the custodian will have no liability.
Emerging Market Risk: The Fund invests in emerging markets, which may experience political, market, social, regulatory, and/or economic instabilities. These instabilities may reduce the value of the Fund's investments.
Political Risk: The value of the Fund's investments may be affected by uncertainties such as international policy developments, social instability and changes in government policies. This can result in more pronounced risks where conditions have a particular impact on one or more countries or regions.
Quantitative Investing Risk: The use of quantitative investment methods present risks such as the use of flawed or incomplete underlying investment models or the risk of errors in the implementation of these models, which may result in its strategies not performing as expected.
Small Capitalisation Companies Risk: The Fund invests in small capitalization companies in developed and emerging market countries. The securities in smaller growth companies may be subject to more unstable market movements than larger, more established companies, due to greater business risk associated with small size, limited product lines, and financial and managerial resources.
Socially Responsible Investment Risk: The Fund may achieve lower returns than an equivalent fund which does not pursue a socially responsible mandate.
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