PGIM launches low-cost buffer ETF with protection options

Newark, N.J. – PGIM, the global investment management business of Prudential Financial Corporation. (NYSE: PRU ) has launched two new exchange-traded funds (ETFs) with buffered options designed to provide investors with downside protection. The PGIM US Large-Cap Buffer 12 ETF Series and the PGIM US Large-Cap Buffer 20 ETF Series listed on the Cboe BZX Exchange have a net expense ratio of 0.50%, which PGIM claims is the lowest market target result among buffered one-year ETFs.

ETFs are designed to track the performance of the S&P 500 Index while providing a predetermined range of potential outcomes. Their goal is to replicate the underlying fund’s returns up to preset limits, with the added benefit of buffering against first losses of 12% or 20% over the course of a year, depending on the series.

Stuart Parker, president and CEO of PGIM Investments, emphasized the appeal of buffered ETFs, especially in volatile markets, and said they offer investors a more predictable range of outcomes. Investors want to balance market participation with risk mitigation.

These buffer ETFs are managed by PGIM Quantitative Solutions and are part of an expanding product suite that now includes 16 active ETFs, doubling PGIM Investments’ product lineup over the past year. PGIM Quantitative Solutions, known for its more than 30 years of managing options trading strategies, is leveraging its experience to offer these new investment tools.

As of September 30, 2023, the investment management firm had more than $1.2 trillion in assets under management.

The information in this article is based on PGIM’s press statement.

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