PGIM Investments on Thursday rolled out the PGIM Active High Yield Bond ETF (PHYL), an actively managed product run by the same fixed-income team that oversees the $7.6 billion PGIM High Yield Fund, an open-end mutual fund.
One immediate advantage to owning the new ETF is its expense ratio of 0.53 percent is a healthy cost savings to the “A” and “C” share classes of the high-yield mutual fund, which come with loads and charge expense ratios of 0.81 percent and 1.50 percent, respectively. The mutual fund’s institutional “Z” share class charges 0.53 percent (and requires a $5 million investment minimum). The SEC yields for the various share classes are all north of 5 percent.
PHYL is the second actively managed fixed-income ETF from PGIM Investments, which debuted the PGIM Ultra Short Bond ETF (PULS) in April. That fund has nearly $64 million in assets and offers an annual yield of 2.48 percent, according to XTF.com.
PGIM Investments is the worldwide distributor of retail products for PGIM, the global investment management business of Newark, N.J.-based Prudential Financial Inc.
The company is late to the ETF game with just two products on the market, and appears to be taking a deliberative approach to introducing new ETFs that leverage its active investment management bent.
“We see a lot of opportunity for an experienced active manager with a core capability in high-yield bond investing,” said Stuart Parker, president and CEO of PGIM Investments, in a press release.
According to PGIM Investments, its fixed-income division has $716 billion under management through this year’s first half.