PRUDENTIAL OPERATION BECOMES AGGRESSIVEGOAL IS $100 MILLION IN MUTUAL FUNDS
Skip to main content
pilogo-NEW
Subscribe
  • Subscribe
  • My Account
  • login
  • NEWS
    • Asset owners and the coronavirus
    • Alternatives
    • Consultants
    • Coronavirus
    • Defined Contribution
    • ESG
    • Frontlines
    • Hedge Funds
    • Investing / Portfolio Strategies
    • Money Management
    • Pension Funds
    • People Moves
    • Private Equity
    • Real Estate
    • Searches & Hires News
    • SECURE Act
    • Special Reports
    • WorldPensionSummit
    • Ron Schmitz
      Pandemic drives faster transition for Virginia to private markets
      Mubadala Investment Co. logo
      Mubadala draws on portfolio in coronavirus fight
      T.J. Carlson
      Texas Muni reduces downside risk during pandemic, finding opportunities now
      Scott Davis
      ‘Triage plan’ at Indiana system helped stem losses
    • BentallGreenOak agrees to acquire Metropolitan Real Estate Equity
      watch video
      0:45
      Private funds weathered 2020 turmoil
      Daniel McHugh
      Aviva Investors promotes from within for real assets CIO
      Marc Rowan
      More alts managers seek expansion to retail market
    • Kieran Mistry
      Hymans Robertson picks head for new non-traditional risk transfer unit
      Troy Saharic
      NEPC brings on director of new business development
      Bill Foley
      Foley-backed SPAC agrees to $7.3 billion deal with Alight
      Jason Schwarz, chief operating officer of Wilshire,
      New owners have big plans for future of Wilshire
    • The Charging Bull statue is covered in snow near the New York Stock Exchange on Feb. 11, 2021
      Bain: Private equity managers finish 2020 strong
      Eastern Colorado VA Receives Shipments Of Covid-19 Vaccines
      Fidelity looks to speed vaccinations to get workers back to offices
      OMERS CEO Blake Hutcheson
      OMERS records worst loss since 2008 on bad COVID-19 bets
      Mitchells & Butlers turns off tap on pension contributions until April
    • Profile of backlit woman against at TV monitor with female symbols on it
      Women outperform men in managing DC plans – Morningstar
      A  Malaysia flag flies in Putrajaya on Sept. 23, 2020
      Malaysia’s EPF ends 2020 up 7.9% at almost $250 billion
      Database’s debut focuses on public-sector DC plans
      DC plan sponsors differ on need for annuities – survey
    • Emissions from a smokestack in Poland
      Asset managers facing more scrutiny on ESG issues – report
      Boris Johnson, U.K. prime minister, hosts the U.N. Security Council's virtual meeting on climate change risks in London on Feb. 23, 2021
      Progress in fighting climate change falls short – U.N.
      Justin Trudeau, Canada's prime minister, smiles during a virtual joint news conference with U.S. President Joe Biden in Ottawa on Feb. 23, 2021
      U.S. joins forces with Canada on climate change
      Signage is displayed at Harvard University Health Services in Cambridge, Mass., on April 20, 2020
      Harvard endowment’s fossil-fuel investments drop to 2% of assets
    • 2 U.K. pension execs take on ESG investing in new podcast
      Donation illustration
      Jefferies will use trading commissions to do good
      Michael Arougheti
      SPACs ride wave as latest investment darling
      Spirit winners
      Prudential honors young people who are helping out
    • Robert 'Rob' Shafir listens during a Senate Permanent Subcommittee on Investigations hearing in Washington on Feb. 26, 2014
      Sculptor hedge fund hits sixth straight year of outflows
      The WallStreetBets forum on the Reddit Inc. website on a laptop computer and the GameStop logo on a smartphone in an arranged photo.
      GameStop frenzy has hedge fund managers rethinking next moves
      Gabe Plotkin, chief investment officer and portfolio manager of Melvin Capital Management, speaks during the Sohn Investment Conference in New York on May 6, 2019
      Citadel, Point72 back Melvin with $2.75 billion after losses
      Shanghai skyline
      Global hedge funds struggle even in a more open China market
    • Luke Ellis, chief executive officer of Man Group
      Man Group reaches record AUM as outflows reverse
      The Charging Bull statue is covered in snow near the New York Stock Exchange on Feb. 11, 2021
      Bain: Private equity managers finish 2020 strong
      Metlife Investment Management selects new head of real estate equity
      Servant-Rainsford combo
      Generali Group picks CEOs for money management businesses
    • Luke Ellis, chief executive officer of Man Group
      Man Group reaches record AUM as outflows reverse
      Metlife Investment Management selects new head of real estate equity
      Eric Lane departs Goldman for Tiger Global
      Eastern Colorado VA Receives Shipments Of Covid-19 Vaccines
      Fidelity looks to speed vaccinations to get workers back to offices
    • A  copy of the Daily Mirror newspaper is removed from the production line at Trinity Mirror's factory in Watford, U.K., on April 13, 2010
      Media group Reach inks buy-in deal for pension fund
      Illinois Teachers preliminary returns falls short of benchmark
      Thomas Spencer
      Oklahoma Teachers chief Tom Spencer to retire
      Swedish flags fly from a tourist souvenir shop in Gamla Stan in Stockholm on March 26, 2020
      Sweden’s AP1 gains 9.7% in 2020
    • Metlife Investment Management selects new head of real estate equity
      Eric Lane departs Goldman for Tiger Global
      Servant-Rainsford combo
      Generali Group picks CEOs for money management businesses
      K. Niles Bryant
      Bowdoin College names new CIO
    • The Charging Bull statue is covered in snow near the New York Stock Exchange on Feb. 11, 2021
      Bain: Private equity managers finish 2020 strong
      Carlyle secures $4.1 billion ESG-related credit facility
      Hamilton Lane raises $3.9 billion for fifth secondary fund
      PSG closes first Europe-focused fund at $1.5 billion
    • AEW chooses head of fund operations and debt finance
      Sebastiano Ferrante and Jocelyn de Verdelon
      PGIM Real Estate turns to staff to fill new roles
      European managers key in on specialist strategies
      Ingrid Jacobs
      Jones Lang LaSalle brings on head of diversity and inclusion
    • Neal and Brady
      Retirement security could be only issue both sides accept
      Retirement cartoon
      Hopes rising for retirement readiness in 2021
      Shawn O'Brien
      Annuities coming to target-date funds, but not right away
      David Ireland
      Sponsors returning to questions about in-plan annuities
    • Charging Bull, sometimes referred to as the Wall Street Bull or the Bowling Green Bull, a bronze sculpture that stands on Broadway just north of Bowling Green in the Financial District of New York City
      Top-performing managers Q4 2020
      P&I 1,000 largest retirement plans: 2021
      Retirement in emerging markets
      Outlook 2021
    • U.S. still a key market for investors
      Collected coverage of P&I's 2020 WorldPensionSummit
      Pedestrians pass a large advertisement on the Arndale Center shopping mall reading 'Act now to avoid a local lockdown' in Manchester, England
      COVID-19 puts new opportunities and risks on the agenda - WPS panelists
      Screens display stock price information over the trading floor of the NYSE Euronext exchange in Paris
      Private assets will continue to grow in portfolios – WPS panelists
  • Data
    • Research Center
    • Searches & Hires Database
    • Searches & Hires News
    • RFPs
    • Charts / Infographics
    • Sponsored Research
    • Trackers
    • Q2 2020 searches and hires overview report
      Q2 2020 money manager M&A activity summary
      Q2 2020 legal overview report
      Q1 2020 searches and hires overview report
    • Los Angeles Fire & Police slates $80 million for real estate, private equity
      Chicago Water scouring for global equity manager
      New York Deferred Comp plan preps international equity search
      Baltimore City Fire & Police commits $15 million to infrastructure fund
    • Los Angeles Fire & Police slates $80 million for real estate, private equity
      Chicago Water scouring for global equity manager
      New York Deferred Comp plan preps international equity search
      Baltimore City Fire & Police commits $15 million to infrastructure fund
    • Actuarial Services
      Emerging Market Equity Manager Services
      Securitized Credit Manager Search
      Private Placements Asset Manager Search
    • Taiwan Semiconductor’s No. 1 in the emerging markets book
      U.S. fixed-income returns post another positive year
      Nasdaq delivers an impressive year
      U.S. dollar's recent decline continues
    • Institutional Investors: Shared Expectations, Divergent Paths
      Global Investor Study 2016
      Workplace Financial Wellness
    • U.S. Endowment Returns Tracker
      Pension Fund Returns Tracker
      Earnings Tracker
      Corporate Pension Contribution Tracker
  • Insights
    • Opinion
    • White Papers
    • Industry Voices
    • Letters to the Editor
    • Partner Content
    • Publisher's Update
    • Tesla cartoon
      Don’t confuse wealth creation with retirement saving
      Top 1000 cartoon
      Top 1,000 retirement plans weather storm just fine
      Infrastructure cartoon
      You must go big on infrastructure, Mr. President
      Retirement cartoon
      Hopes rising for retirement readiness in 2021
    • Investment Trends: Looking Ahead Across Equity Sectors
      Rethinking Market and Reference Data Management
      China is embarking on a new stage of growth
      Gold Outlook 2021
    • Sameer Shalaby
      Commentary: Why should investors care about treasury management?
      David Blitzstein
      Commentary: Without a national retirement policy, Americans face a future of pension crises
      Lawrence Cunningham
      Commentary: Gensler should keep Clayton’s pragmatic proxy adviser rules
      My-Linh Ngo
      Commentary: Pension funds and the role of the debt market in the fight against climate change
    • Writer using a typewriter
      OCIO industry needs to adopt GIPS
      Writer or journalist workplace. stock illustration
      Even as it assails China, Trump administration emulates it
      Skeptical of Main Street support for proxy adviser proposal
      Focus on manager diversity pushes asset owners’ to walk the talk
    • P&I Content Solutions
      How will gold react?
      To people shaking hands
      P&I Content Solutions
      Lessons From 2020: Today’s OCIO Model Passes a Major Test of Governance
      Sponsored Content By MassMutual
      Leveraging Data to Manage Risk
      Sponsored Content By iShares
      ETFs are becoming a cornerstone of insurance equity portfolios
    • Help us help you by supporting quality journalism
      You Must Believe in Spring
      Everything Must Change
      Tomatoes & Investments
  • Multimedia
    • Videos
    • Webinars
    • Polls
    • Slideshows
    • Charts / Infographics
    • watch video
      0:45
      Private funds weathered 2020 turmoil
      watch video
      0:59
      Secure choice and other retirement plans at a state level
      watch video
      3:33
      P&I 1,000 by the numbers 2021
      watch video
      1:33
      A look at hiring activity in 2020
    • Emerging Markets: Expanding Investors’ View
      2021: A Fixed Income Odyssey
      Technology is the New Oil: The Changing Nature of Emerging Markets
      Powering the Change: The power of diversity and inclusion
    • POLL: Working after the pandemic
      POLL: The year ahead for the 1,000 largest U.S. retirement funds
      POLL: The Biden administration’s economic plans
      POLL: Retirement issues in 2021
    • view gallery
      9 photos
      Coronavirus and the markets
      view gallery
      22 photos
      The 1,000 largest retirement funds: 2020
      view gallery
      10 photos
      Outlook 2020
      view gallery
      10 photos
      2019 as seen through the eyes of Roger
    • By the Numbers for February 2021
      Top Performing Managers of Domestic High-Yield Fixed Income, 4th Quarter 2020
      Top Performing Managers of Domestic Long-Duration Fixed Income, 4th Quarter 2020
      Top Performing Managers of Emerging Markets Equity, 4th Quarter 2020
  • Events
    • Conferences
    • Webinars
    • Defined Contribution Spring Virtual Series
      DC Investment Lineup Virtual Series
      ESG Investing Virtual Series
      Private Markets Virtual Series
    • Emerging Markets: Expanding Investors’ View
      2021: A Fixed Income Odyssey
      Technology is the New Oil: The Changing Nature of Emerging Markets
      Powering the Change: The power of diversity and inclusion
  • Careers
  • Research Center
MENU
Breadcrumb
  1. Home
  2. Print
November 14, 1994 12:00 AM

PRUDENTIAL OPERATION BECOMES AGGRESSIVEGOAL IS $100 MILLION IN MUTUAL FUNDS

By Marlene Givant Star
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Prudential Mutual Funds is taking aggressive steps to more than double its assets to $100 billion by the year 2000.

    It is looking at expanding its distribution of offshore funds, possibly through an acquisition or joint venture; it is adding to its international and growth stock fund offerings in the United States; and it continues to opportunistically hire away investment professionals from rival fund companies.

    At the same time, The Prudential Insurance Co. of America, its parent, plans to target the no-load fund market. It recently announced it would acquire the Crabbe Huson family of funds to appeal to customers that prefer the direct marketing approach to load funds sold through financial intermediaries. A new entity, Pru Direct, will spearhead that effort.

    Unlike other insurance giants - such as New York Life Insurance Co. and Metropolitan Life Insurance Co. - that have tapped their money management subsidiaries to subadvise mutual funds, Prudential runs its funds through a distinct entity with its own asset management subsidiary. Prudential Investment Advisors is a firm with 110 investment professionals overseeing $40 billion in 38 open-end funds. Pru Investment Advisors also runs $13 billion in non-mutual fund assets for institutions.

    Surprisingly, few funds are managed by Pru's plethora of asset management subsidiaries.

    One exception is Prudential Diversified Investment Strategies, Short Hills, N.J., which provides asset allocation for the $500 million conservatively managed asset allocation mutual fund.

    At the same time, Pru continues to market other companies' funds through its extensive distribution network. Of the $40 billion in assets it has garnered since its 1987 inception, Prudential Mutual Funds runs $14 billion in money market funds. The rest is split among stock and bond funds, both taxable and tax-exempt. The firm also administers $8 billion in closed-end funds.

    Prudential Investment Advisors runs an additional runs $13 billion in Series funds - variable annuities and variable life insurance products.

    In 1995, the firm plans to focus on international equities, offshore funds and domestic growth stocks. It recently raised $125 million in an open-end European stock fund. Pru Investment Advisors has seven professionals devoted to international, and "will grow as we go forward," said Brendan Boyle, executive vice president and director of marketing.

    Currently, Pru Mutual Funds offers a small-cap global fund, a global natural resources fund, a Pacific growth stock fund and the new Europe fund.

    "International will be one of our major emphases in 1995," said Richard Redeker, president and chief executive officer of Prudential Mutual Funds.

    Both Mr. Redeker and Mr. Boyle are relatively new to Prudential, but not to mutual funds. Mr. Redeker joined Pru in October 1993, and has 27 years in the industry at firms like Wellington Management Co., Boston, and Kemper Financial Services Inc., Chicago. Mr. Boyle has more than 15 years of experience. He joined the firm seven months ago from Smith Barney Shearson Inc., New York.

    Hardwick Simmons, president and chief executive of Prudential Securities Inc., "gave me a broad and very attractive mandate," Mr. Redeker said. "We'd like to have $100 billion under management by the end of the decade."

    To help achieve that goal, Pru is looking into strategic alliances or acquisitions overseas. "We're far ahead of the rest of the world in the asset management business. If distribution opportunities exist elsewhere, we're very interested. We've had a wonderful record in international and domestic equity in the last couple of years," Mr. Redeker said.

    "We think we'd be a very attractive partner," he said, adding that the effort might not necessarily begin in Continental Europe but perhaps in Southeast Asia or Latin America.

    Despite its international focus, the firm recently hired two domestic fixed-income managers from competing firms: Peter Allegrini, former municipal bond manager at Fidelity Investments, and Barbara Kenworthy, a taxable fixed-income manager at Dreyfus Corp.

    Yet the moves do not represent an effort to bolster fixed income, per se.

    "It's like in baseball. When you get an opportunity to get a top talent, you just do it," said Mr. Boyle.

    Ms. Kenworthy will manage a new diversified bond fund in registration with the Securities and Exchange Commission. Mr. Allegrini will manage a municipal high-yield fund.

    The firm does plan to bolster its equity marketing efforts, particularly for growth funds. Pru has been known mainly as a value manager. But growth and value "tend to be complementary styles. They have cycles at different times. Many investors are honing in on owning both. We look constantly at the possibility of new growth stock products," Mr. Boyle said.

    Pru Mutual Funds relies on two channels of distribution for its funds: 5,500 Prudential Securities financial advisers in the United States and 400 overseas and 18,000 Prudential insurance agents.

    The domestic channels of distribution will not be expanded in the foreseeable future, although that's "something any group like this has to look at," said Mr. Redeker. He cited the recent distribution joint venture announced between Dean Witter Reynolds Inc. and NationsBank.

    Indeed, Prudential recently announced it would purchase the Crabbe-Huson funds to give it entry into no-load direct-marketed funds. That effort, Pru Direct, is separate from Prudential mutual funds.

    Pru also has built a sizable business distributing other companies' mutual funds through its financial advisers - 46% of sales in the last year were Pru fund sales, 54% were of external funds.

    For the last several years, mutual funds have represented about 19% of Pru Securities' retail revenues.

    "We want to make mutual funds a more important part of Prudential Securities' revenue base. We allow numerous competing funds," Mr. Redeker said. The firm's financial advisers sell more than 1,000 external funds from 110 fund companies, including such big names as Putnam Investments, Alliance Capital Management, Oppenheimer Capital Corp., Massachusetts Financial Services and Franklin/Templeton Inc.

    "I don't know of another major national brokerage firm with as many selling agreements as we have," Mr. Redeker said. Pru was in the business of selling other companies' funds years before Charles Schwab & Co., San Francisco, and Fidelity entered the fray, he noted.

    To tackle the 401(k) market, Pru has attracted $1 billion for its bundled product, PruWrap, which is based in Edison, N.J., where its transfer agent operation is located. It also makes its mutual funds available to 401(k) clients through Prudential Securities marketers.

    Recommended for You
    Read the print edition of P&I
    Read the print edition of P&I
    Gender diversity is improving on FTSE 350 boards
    Gender diversity is improving on FTSE 350 boards
    FINRA honors Wharton's Olivia Mitchell with Ketchum Prize
    FINRA honors Wharton's Olivia Mitchell with Ketchum Prize
    Lessons From 2020: Today’s OCIO Model Passes a Major Test of Governance
    Sponsored Content: Lessons From 2020: Today’s OCIO Model Passes a Major Test of Governance
    sponsored
    Events
     
     
    Sponsored
    White Papers
    Rethinking Market and Reference Data Management
    Investment Trends: Looking Ahead Across Equity Sectors
    China is embarking on a new stage of growth
    Gold Outlook 2021
    Shifting DC Times - Winter 2021
    GP-LED OPPORTUNITIES AT THE SMALLER END OF THE MARKET
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    pilogo-NEW
    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    150 N. Michigan Ave.
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • NEWS
      • Asset owners and the coronavirus
      • Alternatives
      • Consultants
      • Coronavirus
      • Defined Contribution
      • ESG
      • Frontlines
      • Hedge Funds
      • Investing / Portfolio Strategies
      • Money Management
      • Pension Funds
      • People Moves
      • Private Equity
      • Real Estate
      • Searches & Hires News
      • SECURE Act
      • Special Reports
      • WorldPensionSummit
    • Data
      • Research Center
      • Searches & Hires Database
      • Searches & Hires News
      • RFPs
      • Charts / Infographics
      • Sponsored Research
      • Trackers
    • Insights
      • Opinion
      • White Papers
      • Industry Voices
      • Letters to the Editor
      • Partner Content
      • Publisher's Update
    • Multimedia
      • Videos
      • Webinars
      • Polls
      • Slideshows
      • Charts / Infographics
    • Events
      • Conferences
      • Webinars
    • Careers
    • Research Center