Prudential Investments has unveiled a new short duration muni high income fund to offer investors protection in a rising interest rate environment.
Know as Prudential Short Duration Muni High Income Fund, the new fund seeks higher yield and tax-exempt income by investing in a diversified range of shorter duration municipal bonds.
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Managed by Prudential fixed income’s municipal bond team, the fund will use collaborative fundamental, bottom-up, research-based subsector and security selection. It will maintain a weighted average portfolio duration of 4.5 years or less.
The fund will use a split benchmark of 50% Barclays Municipal Bond Index 1-8 Year and 50% Barclays Municipal High Yield Index 1-8 Year.
The municipal bond team includes Susan Courtney, Robert Tipp, Lee Friedman, and John Dittemer.
Stuart Parker, president of Prudential Investments, said: "This fund will address the growing investor demand for fixed income strategies that may perform well in a rising rate environment. It may also provide an advantage for investors seeking relief from rising taxes."
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