Managing over US$500 billion in world markets demands a robust investment philosophy. Prudential Portfolio Managers has built its reputation of prudent value investing on a comprehensive understanding of markets and the many influences affecting the price of an asset.

At Prudential, we consider a sound and consistent investment philosophy vital to our success in investment management. Our investment philosophy, characterised as Prudent Value Investing, involves taking a proactive view on markets, with the aim of outperforming both the indices, our competitors and inflation over the longer term.

‘Value’ is the essence of our philosophy and drives our investment process.
Assets are often mis-priced. We believe that prices in investment markets often do not reflect their fundamental, or real, value. Either investors become over-enthusiastic about prospects for particular investments and chase prices too high, or they neglect an underrated pool of assets. We look to invest in those areas that are undervalued by the market. In the longer-term, prices of most undervalued assets will rise to reflect their true value as they find renewed favour with investors.

It is easy to recognise value with the benefit of hindsight; finding it in advance is where true skill lies.
Value investing often involves taking the contrarian view and buying out of favour stocks. This requires a high level of confidence when making decisions that the ‘crowd’, in the short-term, considers foolish. Our analysis enables us to discriminate between stocks that are cheap because the companies concerned have poor prospects, from those that are simply neglected by the market.

Challenging the consensus viewpoint requires a medium to longer-term view. As value managers, we need a pragmatic strength in our convictions, confident that we will be right over time. At Prudential, our fund management team use a research-intensive process to find value. We apply a rigorous investment framework in managing your money to provide superior performance in all markets, despite their prospects.