Industry Updates

New listing: PGIM bridges the gap between active vs passive

George Geddes

a bridge over a river

Many would argue that you can only invest actively or passively. Active being your asset managers carefully selecting which stocks to invest in. Passive being your index funds. A significant factor for deciding between the two methods is costs. ETFs are much cheaper but this is because they require less maintenance.

PGIM is bridging the gap between the two options following its latest launch.

PGIM has announced the launch of the first of four actively managed equity ETFs it plans to issue in 2018. PGIM QMA Strategic Alpha Large-Cap Core ETF (PQLC) is accompanying the two actively managed fixed income ETFs PGIM launched earlier this year.

With an expense ratio of 0.17%, PQLC is half the cost of the average passive ETF, according to the firm. PGIM plan to launch three more Strategic Alpha ETFs by the end of 2018:

  • PGIM QMA Strategic Alpha Small-Cap Growth ETF (PQSG)

  • PGIM QMA Strategic Alpha Small-Cap Value ETF (PQSV)

  • PGIM QMA Strategic Alpha International Equity ETF (PQIN).

Sub-advised by the QMA, investors in this range will exposed to the portfolio's adjustments and rebalancing by the asset managers.

Stuart Parker, CEO of PGIM Investments, said: "Adding equity to our mix of ETF strategies gives investors a cost-effective way to access the equity markets while obtaining the potential benefits of active management. Introducing these funds - managed by one of the industry's pioneering quantitative managers - is a natural evolution in our effort to create new investment vehicles that meet investors' evolving needs."

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