Pru Life UK, the pioneer of insuravest or investment-linked life insurance in the Philippines, has launched PRULink Cash Flow Fund – PhP hedged share class (Peso CFF), which aims to provide payouts of up to 1% of fund value per quarter or 4% per annum by investing in a diversified portfolio of US dollar-denominated high-yield bonds and hedging against foreign-exchange fluctuations.
The Peso CFF primarily invests in the Eastspring Investments’ Asian Bond Fund and US High Yield Bond Fund. The Peso CFF may also invest up to 20% of its assets in high dividend-yielding global equity funds offering diversification and helping to mitigate against market volatility.
Antonio De Rosas, Pru Life UK President and Chief Executive Officer, said, “We are pleased to introduce the Peso CFF, designed for investors with moderate risk appetites and with a desire to have a reliable stream of income. With its prudent fund management and hedging strategy, combined with comprehensive insurance coverage offered by our insuravest solutions to policyowners until the age of 99, the Peso CFF provides customers with the opportunity to expand their wealth and meet their financial goals.”
The Peso CFF builds on the successful track record of the PRULink USD cash flow fund, the US dollar-denominated counterpart launched by Pru Life UK in 2014 and primarily invests in the same assets as the PRULink USD cash flow fund – therefore allowing Peso CFF policyowners to enjoy the same potential payouts but in Philippine peso.
Additionally, the foreign exchange risks of the policyowners’ invested peso are minimized because of the Peso CFF’s hedging mechanism, an investment strategy that aims to reduce risks caused by volatile price movement of an asset such as currencies.
Moreover, the Peso CFF’s diversified investments in high-yield bonds and dividend-yielding equities make the fund less volatile, allowing policyowners to receive payout as an additional steady source of income.
The Peso CFF will be available in new peso-denominated PRUmillionaire and PRULink investor account plus (PIA), Pru Life UK’s single-pay insuravest solutions. Existing Pru Life UK policyowners of the Peso PIA plus and PRUmillionaire policies may request for a fund switch to the Peso CFF. The new fund will be sold at PhP 1.00 per unit starting September 17, 2018.
Pru Life UK’s fund portfolio is managed by Eastspring Investments (Singapore) Limited, a subsidiary of the Asian asset management business of Prudential plc, Eastspring Investments. Eastspring Singapore has been managing the underlying funds of Pru Life UK’s insuravest solutions since these products were pioneered in the Philippines in 2002.
Eastspring Investments was named Asia’s Fund House of the Year at the AsianInvestor Awards for the third time in four years (2018, 2017 and 2015) – recognizing its continued strong growth, unrivalled footprint in Asia, profitable results and consistent Investment performance.