PGIM Ladders Nasdaq-100 Buffer 12 ETF (PBQQ)

Overview

PBQQ is an innovative investment vehicle that consists of a curated selection of defined outcome buffer exchange-traded funds (ETFs). The fund comprises four unique equity buffer funds, each designed to provide exposure to the performance of QQQs while enabling capped gains and cushioning against losses of up to 12%. PBQQ employs an investment strategy that allocates resources equally across these underlying ETFs, each differentiated by the expiration timing of their associated options—ranging from three to twelve months. This dynamic structure allows PBQQ to refresh approximately every 90 days, implementing a continuous hedge irrespective of the outcomes of the underlying ETFs. By doing this, PBQQ effectively mitigates timing risks commonly associated with traditional monthly buffer strategies. Investors can conveniently access updated information regarding the fund’s exposure to the underlying ETFs, alongside details on remaining caps and buffers, through the issuer's website on a daily basis.

Products and Services

• Equity Buffer Funds

Each of the four equity buffer funds within PBQQ is structured to provide a defined investment outcome, offering exposure to the performance of the Nasdaq-100 Index, represented by QQQs. They deliver a balance of risk management through capped gains and buffered losses, with a protective layer against downturns in the market.

• Diversified Exposure Strategy

PBQQ invests equally across its four underlying ETFs that utilize different expiration timelines for their options. This approach effectively spreads risk and creates a balanced investment profile, enhancing overall stability even during volatile market conditions. The staggered expiration dates (3, 6, 9, and 12 months) allow for smoother transitions and adjustment to changing market dynamics.

• Dynamic Buffer Refresh Cycle

Unlike traditional buffer funds that reset annually, PBQQ refreshes its position approximately every 90 days. This continuous buffer refresh allows for ongoing management and adaptation based on current market conditions, thereby reducing risks and aligning with the investor's needs for timely investment responses.

• Daily Transparency and Reporting

Investors benefit from daily transparency regarding the fund’s performance. Information related to the exposure of the underlying ETFs, as well as updates on the remaining caps and buffers, are readily accessible through the issuer's website, enabling informed decision-making and investment management.

• Reduced Timing Risk

PBQQ’s strategy significantly reduces the timing risks typically associated with monthly buffer strategies. By providing a consistent and ongoing hedge, it enhances the potential for risk-adjusted returns over time, making it an appealing option for investors looking for stability and predictability in their investment portfolios.