Multi-Sector Intermediate Core

Investment Objective

The investment objective of the Intermediate Core Fixed Income Strategy is to outperform Bloomberg Barclays U.S. Intermediate Aggregate Index (the "Index") or similar index by +50 bps.1,2

1 There is no guarantee that these objectives will be met.
2 On average, over a full market cycle defined as three to five years.

Investment Philosophy

PGIM Fixed Income’s Intermediate Core Fixed Income portfolios are managed based on the philosophy that research-driven security selection is the most consistent strategy for adding value to client portfolios. We complement that base strategy with modest sector rotation, duration management, and disciplined trade execution. Risk budgeting is central to our approach.

The Strategy tends to generate its excess return over benchmark from fairly equal increments of both sector allocation and subsector/security allocation. Duration and yield curve positioning have historically not been primary sources of excess return but will be considered when exceptional market opportunities dictate. The Strategy is predominately investment grade-focused, but, if individual client guidelines permit, will allocate modestly to non-benchmark high yield bond and emerging markets debt sectors.

Sector Allocation:

10-30 bps

 

Subsector and Security Selection:

15-40 bps

 

Duration/Curve:

0-5 bps

Investment Process

PGIM Fixed Income employs a disciplined, three-step investment process to manage Intermediate Core Portfolios:

 

  1. Senior investment team assesses global market environment:

    • Economic research
    • Sector analysis
  2. Senior portfolio managers construct portfolio with sector specialists and analysts

    Risk Budgeting

    • Establish risk targets within client's risk budget

    • Capture thresholds for systematic and idiosyncratic risks
    Arrow Right

    Asset Allocation

    • Determine risk, sector, and term structure positioning

    • Incorporate themes given current market dynamics

    • Ideas from sector specialists are emphasized
    Arrow Right

    Security Selection

    • Sector specialists and research analysts aligned by industry determine individual securities

    • Research-based approach
  3. Senior portfolio managers and risk managers oversee risk positions

Senior Portfolio Managers

 

Michael Collins

CFA, Managing Director and Senior Portfolio Manager

 

Gregory Peters

Managing Director and Senior Portfolio Manager

 

Richard Piccirillo

Managing Director and Senior Portfolio Manager