PGIM Mutual

Prudential Global Investment Management PGIM is an asset management arm especially used by the American life insurance company as Prudential Financial. PGIM traces its history to the founding of its parent company Prudential Financial during in 1975. It is currently one of the largest asset managers throughout the world, with more than 1100 investment professionals working for the company across 31 offices.

PGIM is divided into eight asset management divisions, each of which specializes in a particular asset class like PGIM Fixed Income-focuses on investing in the global fixed income markets through offices in the US, London, Tokyo, and Singapore; Jennison Associates-founded, is a fundamental equity investment arm of PGIM with $168 billion in assets under management; others are respectively QMA Prudential Capital Group PGIM Real Estate

Total Returns

Total return is the amount of value of an investor earns from a security over a specific period, generally one year when all distributions are being reinvested. It is expressed as a percentage of the amount invested. For instance, a total return and the security increased vice-versa of its original value due to price increase distribution of dividends or stock, bond or capital gains. So, the total return is a strong measure of an investment’s overall performance. During measuring the performance, the actual rate of return of an investment or collective investments over a specific evaluation period is called Total Return. It includes respectively the interest, funds gains, dividends and distributions realized over a specified period of time.

There are two categories of total return accounts like income including interest paid by fixed-income investments, distributions or dividends and fund appreciation, representing the change in the market price of an asset.

For example, if an investor buys 100 shares of Stock A at $20 per share for an initial value of $2,000. Stock A pays 5% dividend to the investor for reinvestment, buying five additional shares. After one year, the share price rises to $22. Calculating the investment’s total return, investor divides the total investment gains (105 shares x $22 per share=$2,310, current value-$2000, initial value- $310 total gains) by the initial value of the investment ($2000) and multiplies by 100 to convert the answer to a percentage ($310/$2000 x 100=15.5%). The investor’s total return is 15.5%.

Global Real Estate

Real Estate is a modern term for land, buildings, fences, and things attached to buildings like plumbing, heating along with lighting fixtures. The sale and lease of real estate in the USA are major economic activities which are regulated by the state and federal laws. Commercial and residential are the two major types of real estate endeavors. Commercial involves sale and lease of property for business purposes while residential involves sale and rental of land and houses to individuals and families for their own living purposes. 

Since the 1970s, the business of real estate started in different ways and the buyers have been given additional protection under the law of some countries. The federal government enacted ‘Real Estate Settlement Procedure Act in 1974 (RESPA) to ensure that the buyer of the residential real estate of many costs associated with the sale. RESPA mandates federally insured lending institution giving early notice to the buyers to be paid on the due date during closing the transaction and the costs typically used for property survey, appraisals, title searches, broker’s fee, processing and administrative charges. 

Corporate High Yield

Corporate high-yield is high paying bond with a lower credit rating than investment like grade corporate bonds, treasury bond and also the municipal bonds. Due to high risk of default, these types of bonds pay a higher yield than investment grade bonds. Based on the two main credit rating agencies, high-yield bonds carry a rating below ‘BBB’ and bellow ‘Baa’ from Moody’s. Bonds with ratings at or above, these levels are considered investment grade. Credit ratings can be as low as ‘D’ and most bonds with ‘C’ ratings or lower carry a high risk; to compensate for this risk, yields will normally be very high.

High-yield bonds are issued by companies whose credit-worthiness level prevents their debt securities from being rated as investment grade. Rating of Baa, BBB or higher is considered invest grade, while lower ratings are designated noninvestment grade. Lower credit ratings require the issuer offer a higher yield to balance the risk and grow interested in the investors. Despite the high-risk levels, high yield bonds have the good performance for the investors, overall annual default rates of less than 5%.