Prudent Allocation Fund

ISIN
GB00BV8BTV53

Price (21.02.2018)
11.01

Objective and investment policy

Objective

The fund aims to provide positive total returns (the combination of income and capital growth) over any three-year period from a flexibly managed portfolio of assets invested around the world. There is no guarantee that the fund will achieve a positive return over any period, and you may not get back the amount you originally invested.

Investment policy and strategy

Core investment: The fund is typically invested in a mix of assets, including bonds, company shares and currencies.

The fund typically invests in assets indirectly via derivatives. It may also invest in assets directly or through other funds. The use of derivatives allows the fund manager to carry out trading strategies that seek to profit from falls in asset prices. It also allows the fund to gain exposure to investments exceeding the value of the fund in order to increase potential returns in both rising and falling markets. In addition, derivatives are used to reduce risk and costs and to manage the impact of changes in currency exchange rates on the fund’s investments.

Other investments: The fund also invests in convertibles and property-related securities. It may also hold cash, warrants and money market instruments (for example, debt due to be repaid within a year).

Strategy in brief: The fund is managed with a highly flexible investment approach. The fund manager has the freedom to allocate capital between different types of assets in response to changes in economic conditions and asset prices. The approach combines in-depth research to work out the ‘fair’ value of assets over the medium to long term, with analysis of the market’s short-term reactions to events, to identify investment opportunities. The fund seeks to manage risk by investing globally across multiple asset classes, sectors, currencies and countries. Where the manager believes opportunities are limited to a few areas, the fund may be very concentrated in certain assets or markets.

Glossary terms

Bonds: Loans to governments and companies that pay interest.

Convertibles: Bonds issued by companies that usually pay a set rate of interest and which can be exchanged for predetermined amounts of company shares.

Derivatives: Financial contracts whose value is derived from other assets.

Warrants: Financial contracts which allow the fund manager to buy stocks for a fixed price until a certain date.

Risks associated with the fund

The value of investments and the income from them will rise and fall. This will cause the fund price, as well as any income paid by the fund, to fall as well as rise. There is no guarantee the fund will achieve its objective, and you may not get back the amount you originally invested.

The fund may use derivatives with the aim of profiting from a rise or a fall in the value of an asset (for example, a company’s bonds). However, if the asset’s value varies in a different manner, the fund may incur a loss.

If the share class is hedged (H share class), it aims to mirror the performance of another share class. We cannot guarantee that the hedging objective will be achieved. The hedging strategy will limit holders of the hedged share class from benefiting if the hedged share class currency falls against the euro.

From time to time the fund may be highly concentrated in one or a few investment strategies, which could result in large price rises and falls.

The fund will invest in emerging markets which are generally smaller, more sensitive to economic and political factors, and where investments are less easily bought and sold. In exceptional circumstances, the fund may encounter difficulties when selling or collecting income from these investments, which could cause the fund to incur a loss. In extreme circumstances, it could lead to the temporary suspension of dealing in shares in the fund.

Where market conditions make it hard to sell the fund’s investments at a fair price to meet customers’ sale requests, we may temporarily suspend dealing in the fund’s shares.

Some transactions the fund makes, such as placing cash on deposit, require the use of other financial institutions (for example, banks). If one of these institutions defaults on their obligations or becomes insolvent, the fund may incur a loss.

Other information

The Fund allows for the extensive use of derivatives.

Performance

The value of investments will fluctuate, which will cause fund prices to fall as well as rise and you may not get back the original amount you invested. The level of any income earned by the fund will fluctuate. Past performance is not a guide to future performance. 

Source: Price: State Street. Performance: Morningstar. Performance figures are on a price to price basis with income reinvested. Performance figures may not reflect all relevant charges.

Please note that the Morningstar Category performance data in this tool where shown, is from the default Morningstar database, which contains all the share classes for each fund available across Europe, Asia and Africa. This can differ from the comparative sector data in M&G factsheets which is from the same database, but showing only the most appropriate share class to represent each fund, and for just those funds available in Europe. Neither Morningstar nor its Information Providers can guarantee the accuracy, completeness, timeliness, or correct sequencing of any of the Information on the Web site, including, but not limited to Information originated by Morningstar, licensed by Morningstar from Information Providers, or gathered by Morningstar from publicly available sources. There may be delays, omissions, or inaccuracies in the Information.

 

News

Fund Team

Craig Moran

Craig Moran - Fund manager

Craig Moran was appointed co-manager of the M&G Prudent Allocation Fund on launch in April 2015. He has also been deputy fund manager on the M&G Managed Growth Fund since 2013 and on the M&G Episode Allocation Fund and the M&G Dynamic Allocation Fund since 2011. Craig joined M&G in 2005 as a performance and risk analyst and was later promoted as a fund managers' assistant to the Multi Asset team. In 2010, he became the team's investment analyst. Craig holds a bachelor of business degree from Queensland University of Technology and a masters in applied finance and investments from the Financial Services Institute of Australasia. He is a CFA charterholder.

 Team member biography
Juan Nevado

Juan Nevado - Fund manager

Juan Nevado joined PPM (now M&G) in 1988 and is a member of the M&G Multi Asset team, with over 20 years of investment experience. In January 2011, Juan was appointed co-manager of the M&G Dynamic Allocation Fund and the M&G Episode Allocation Fund. In April 2015, he was appointed co-manager of the M&G Prudential Allocation Fund upon its launch. Prior to joining M&G, Juan worked as a bond economist at the Bank of Montreal, and before that, as an economist for the Commodities Research Unit, a private business consultancy specialising in macro/micro research on commodities markets. Juan has a BSc in economics from the LSE and an MA in economics from Warwick University.

 Team member biography
Steven Andrew

Steven Andrew - Deputy Manager

Steven Andrew joined M&G in 2005 as a member of the portfolio strategy & risk team, before moving to the Multi Asset team, where he helped to formulate asset allocation strategies for M&G's multi-asset fund range. In November 2010, Steven was appointed manager of the M&G Episode Income Fund. Three years later, he became manager of the M&G Income Allocation Fund upon its launch. Steven began his career at the Bank of England in 1987 and subsequently worked at F&C Asset Management and Merrill Lynch before joining M&G. He holds a BSc (Hons) degree in financial economics from the University of London.

 Team member biography
Susanne Grabinger

Susanne Grabinger - Investment specialist

Susanne Grabinger joined M&G in 2010 and is currently an investment specialist providing support for M&G's multi-asset fund range and the M&G Global Convertibles Fund. Prior to joining M&G, Susanne worked at JPMorgan Asset Management as a client portfolio manager, focusing on institutional equity accounts and balanced mutual funds. She holds a master’s degree in business administration from the University of Bamberg, Germany, and is a CFA charterholder. Susanne is fluent in German and English and is also proficient in French and Spanish.

 Team member biography
Ana Cuddeford

Ana Cuddeford - Investment specialist

Ana Cuddeford is the investment specialist covering M&G’s multi-asset fund range and the M&G Global Convertibles Fund. She initially joined M&G in December 2013 from FTSE Group, where she had helped execute their FTSE4 Good company engagement. Prior to that, Ana spent 16 years in equity sales, the last 11 of which were at financial group Citi. She is fluent in English, Spanish and Italian and has a good command of French. Ana graduated from the University of Wales, College of Cardiff with a BSc (Hons) in European community studies.

 Team member biography
Christophe Machu

Christophe Machu - Investment specialist

Christophe Machu joined the Multi Asset and Convertibles teams as an associate investment specialist providing support for M&G's multi-asset fund range and the M&G Global Convertibles Fund in September 2014. He initially joined M&G in 2012 as a sales support in Paris before moving into the International Marketing team in London. Christophe has an MSc in risk and finance from EDHEC Business School.

 Team member biography

Graziano Creperio - Investment specialist

Graziano Creperio joined the M&G Multi Asset team as an associate investment specialist providing support for the M&G multi-asset funds. He initially joined M&G in 2012 as a fund data analyst and was later promoted to senior data specialist. Prior to joining M&G, Graziano worked as a portfolio data analyst at Morningstar. He holds a MSc in management and a BA in economics from Bocconi University in Milan. He also studied at Babson College in Boston and Jiao Tong University in Shanghai.

 Team member biography

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