M&g Plc · LSE:MNG
M&g — Corporate Update (June 2024)
35 slides from M&g's corporate update, Jun 25, 2024
Slide 1: PruFund Monthly Update and T&IO SAA Update
PruFund Monthly Update and T&IO SAA Update 25 June 2024 This is just for UK advisers – it’s not for use with clients
Slide 2: Important information
Important information This presentation is for adviser use only, and is based on our current understanding of taxation, legislation and HMRC practice, all of which are liable to change and subject to an individual’s own circumstances. The rate of growth of funds and any income from them cannot be gu
Slide 3: PruFund – Target market information
PruFund – Target market information The PruFund funds aim to: • grow your client’s money over the medium to long term (5 to 10 years or more) • protect customers from some of the short-term ups and downs of direct stock market investments by using an established smoothing process
Slide 4: Size isn't everything, or is it?
Size isn’t everything, or is it? £129bn £62bn £58bn £6bn Source: For Prudential figures https://www.mandg.com/dam/pru/shared/documents/en/pruf100222103.pdf For IA sector figures, source is FE Analytics as at 25 Jun 2024.
Slide 5: What we will cover
What we will cover • UPAs • Market context • PruFund performance
Slide 6: Unit Price Adjustments (UPAs)
Unit Price Adjustments (UPAs) • UPAs reflect the actual past performance of each PruFund and the smoothing approach followed • They are formulaic and non discretionary • For S2, Series A, Series B and Series D; there is a Daily Smoothing Limit and a Quarterly Smoothing Limit • For Series C, E and F;
Slide 7: UPA position 25 June 2024
UPA position 25 June 2024 Retirement Account – Series E Offshore – Series C PruFund version Last negative UPA PruFund version Last negative UPA UPA UPA Growth 25/10/2023 Growth 25/10/2023 Cautious 25/08/2023 Cautious 25/08/2023 Risk Managed 1 25/08/2023 Risk Managed 1 25/08/2023 Risk Managed 2 25/10
Slide 8: UPA position 25 June 2024
UPA position 25 June 2024 Planet – Series E Planet – Series C PruFund version Last negative UPA PruFund version Last negative UPA UPA UPA Planet 1 25/08/2023 Planet 1 25/08/2023 Planet 2 25/10/2023 Planet 2 25/10/2023 Planet 3 25/08/2023 Planet 3 25/08/2023 Planet 4 25/08/2023 Planet 4 25/08/2023 Pl
Slide 9: UPA position 25 June 2024
UPA position 25 June 2024 Wealth Platform – Series F Wealth Platform - Series F PruFund version Last negative UPA PruFund version Last negative UPA UPA UPA Planet 1 25/08/2023 Growth Planet 2 25/10/2023 Cautious 25/10/2023 Planet 3 25/08/2023 Risk Managed 1 25/10/2023 Planet 4 25/08/2023 Risk Manage
Slide 10: Performance of markets since 28 May 2024
Performance of markets since 28 May 2024 BoA Euro BoA US FTSE Asia IA Mixed IA Mixed IA Mixed UK Gilts All Corporate BoA Sterling Corporate BoA Euro HY BoA Sterling BoA US HY FE UK FTSE Dev FTSE Europe Pacific ex MSCI Emg Investment 0- Investment Investment IA Flexible PruFund BoE Base Rate Stocks H
Slide 11: Performance of PruFund Growth Ser E and Ser F – past 12 months
Performance of PruFund Growth Ser E and Ser F – past 12 months 10 8.63% 8.50% 8 7.73% 6 4 2 2.33% 0 -2 -4 IA Mixed Investment 20-60% Shares TR in GB Pru - PruFund Growth Fund Pn Ser F GTR in GB ABI Mixed Investment 20-60% Shares GTR in GB Pru - PruFund Growth Fund Pn Ser E GTR in GB Figures are for
Slide 12: PruFund performance - accumulation
PruFund performance - accumulation
Slide 13: Performance of PruFund Cautious – 5 yrs
Performance of PruFund Cautious – 5 yrs 25 20 19.17% 15 10 5 5.64% 2.62% 0 -5 -10 -15 24/06/2019 24/07/2019 24/08/2019 24/09/2019 24/10/2019 24/11/2019 24/12/2019 24/01/2020 24/02/2020 24/03/2020 24/04/2020 24/05/2020 24/06/2020 24/07/2020 24/08/2020 24/09/2020 24/10/2020 24/11/2020 24/12/2020 24/01
Slide 14: Performance of PruFund Growth – 5 yrs
Performance of PruFund Growth – 5 yrs 30 27.71% 25 20 15 15.28% 10 10.85% 5 0 -5 -10 -15 -20 24/06/2019 24/07/2019 24/08/2019 24/09/2019 24/10/2019 24/11/2019 24/12/2019 24/01/2020 24/02/2020 24/03/2020 24/04/2020 24/05/2020 24/06/2020 24/07/2020 24/08/2020 24/09/2020 24/10/2020 24/11/2020 24/12/202
Slide 15: Performance of PruFund Risk Managed 5 – 5yrs
Performance of PruFund Risk Managed 5 – 5yrs 50 40 39.26% 30 31.13% 28.59% 20 10 0 -10 -20 -30 24/06/2019 24/07/2019 24/08/2019 24/09/2019 24/10/2019 24/11/2019 24/12/2019 24/01/2020 24/02/2020 24/03/2020 24/04/2020 24/05/2020 24/06/2020 24/07/2020 24/08/2020 24/09/2020 24/10/2020 24/11/2020 24/12/2
Slide 16: PruFund performance - decumulation
PruFund performance - decumulation
Slide 17: Performance of PruFund Cautious with 3% withdrawals – 5 yrs
Performance of PruFund Cautious with 3% withdrawals – 5 yrs 220000 210000 £205,326 200000 190000 180000 £181,361 £175,728 170000 160000 150000 01/05/2019 01/06/2019 01/07/2019 01/08/2019 01/09/2019 01/10/2019 01/11/2019 01/12/2019 01/01/2020 01/02/2020 01/03/2020 01/04/2020 01/05/2020 01/06/2020 01/
Slide 18: Performance of PruFund Growth with 4% withdrawals – 5 yrs
Performance of PruFund Growth with 4% withdrawals – 5 yrs 230000 220000 210000 £209,733 200000 190000 £189,716 180000 £181,671 170000 160000 150000 01/05/2019 01/06/2019 01/07/2019 01/08/2019 01/09/2019 01/10/2019 01/11/2019 01/12/2019 01/01/2020 01/02/2020 01/03/2020 01/04/2020 01/05/2020 01/06/202
Slide 19: Performance of PruFund Risk Managed 5 with 5% withdrawals – 5yrs
Performance of PruFund Risk Managed 5 with 5% withdrawals – 5yrs 240000 230000 220000 £218,836 210000 £210,010 £204,711 200000 190000 180000 170000 160000 150000 01/05/2019 01/06/2019 01/07/2019 01/08/2019 01/09/2019 01/10/2019 01/11/2019 01/12/2019 01/01/2020 01/02/2020 01/03/2020 01/04/2020 01/05/
Slide 20: Economic Outlook
No Economic Outlook
Slide 21: The Great Moderation, pre Covid
The Great Moderation, pre Covid Several tailwinds created a benign structural backdrop 1990’s 2000’s 2010’s 2020’s Inflation targeting Accelerating global trade Financial crisis Pandemic supply WTO expansion Convergence of living Populist pushback on shocks Expanding use of standards globalisation G
Slide 22: Structural changes bring new challenges for policymakers and investors
Structural changes bring new challenges for policymakers and investors Trade fragmentation Peaking demographics Impact New supply constraints Higher economic volatility More constraints for policymakers Geopolitical rivalry Climate concerns More challenging return environment Shifting correlations F
Slide 23: Regime changes pre and post Covid
Regime changes pre and post Covid Aspect 21st century Pre Covid Post Covid Central bank policy Mainly focused on stimulating growth, Central banks need to strike a balance between including low interest rates and use of inflation and growth objectives. quantitative easing (inflation not deemed Highe
Slide 24: Scenarios to watch
Scenarios to watch Consistent with our “one past, many futures” ethos Financial Stability – After Inflation Risk – getting Supply Chains – Fresh the Tide Goes Out more balanced? risks emerging Geopolitics – a shifting El Niño – Turbulent start to China – out of the woods? world order 2024 24 For int
Slide 25: Key themes for 2024 and Beyond
Key themes for 2024 and Beyond Economic Outlook: can a soft New Frontiers: The promise and Tinder pot: Geo-politics as a risk landing be achieved? challenges of AI factor As inflation slows, varying economic AI promises productivity growth, will this Geopolitical instability demands agility cycles b
Slide 26: Strategic Asset Allocation
No Strategic Asset Allocation
Slide 27: Evolution of the With-Profits Life Fund (OBMG)
Evolution of the With-Profits Life Fund (OBMG) Constantly evolving & diversified fund adds value EM Debt UK Equities Private Credit Risk Reduction US Treasuries Asian FI Risk Reduction Risk Increase Material increase Significant move from Key increase, using Based on stage of Added as defensive Mate
Slide 28: Overview and Capital Markets Update
Overview and Capital Markets Update UK policy rate and bond yield ▪ The Q4 2023 SAA review (effective 1st Nov 2023) allowed for the significant tightening seen over the prior 18 months, resulting in a meaningful rebalancing of 6.0 fixed income levels relative to equities 515 bps of tightening 5.0 UK
Slide 29: 2024 With Profits asset share funds SAA – Rebalancing Equities into Fixed Income
2024 With Profits asset share funds SAA – Rebalancing Equities into Fixed Income Fixed Income changes 67th percentile 33rd percentile US IG 67th %ile 33rd %ile UK IG 67th percentile 33rd percentile 700 2000 700 600 US IG spreads UK IG Spreads Global HY spreads 600 500 1500 500 400 OAS OAS 400 1000 3
Slide 30: 2024 With Profits asset share funds SAA – Rebalancing Equities into Fixed Income
2024 With Profits asset share funds SAA – Rebalancing Equities into Fixed Income Equities and Real Assets changes Equities (profit taking and geographical rebalancing) Real Assets (economic environment and implications) • The main factors influencing equity Level 2 include a combination of profit ta
Slide 31: 2024 With Profits asset share funds SAA review
2024 With Profits asset share funds SAA review Rebalancing Equity into Fixed Income PruFund Growth Fund (OBMG) SAA 2024 PruFund Cautious Fund (OBPC) SAA 2024 Source: End of the month allocation as of 01/6/2024 for OBMG (PruFund Growth fund). Source: LTIS Source: End of the month allocation as of 01/
Slide 32: In case question asked on 'Other Strategies'
In case question asked on ‘Other Strategies’
Slide 33: Capital Market Returns
Capital Market Returns Core factors Secondary Factors • Volatility premia Growth (Global) • Time series factors – e.g. cross-asset momentum • Bubbles – episodic opportunities Emerging Market Growth • Small cap • Idiosyncratic • Flexible for other strategies Core Factors Inflation with relative valua
Slide 34: Questions
QUESTIONS
Slide 35: Thanks for your time
Click to add text Thanks for your time Get in touch with your usual contact if you need further help
Prudential PruFund (M&G) — Corporate Update (June 2024) on 6ix