PGIM head of UK wealth Rob Hall on growing interest in CLOs and ‘quantamental’ strategies and accelerating innovation in the wealth space
Where – and why – are you anticipating demand or fund-flows from UK-based wealth managers and their clients over the next 12 months?
Fixed income remains in high demand among wealth managers, as the asset class can offer robust yields and continues to serve as a crucial counterweight to equities in client portfolios. That said, the powerful cross-currents we have witnessed in recent years – including geopolitical turbulence, trade tensions and differing monetary and fiscal policies – remain in place. Therefore, investors are increasingly seeking exposure to multi-sector strategies that can pivot between segments of the bond market to capitalise on dramatic overreactions and directional corrections.
Elsewhere in fixed income, collateralised loan obligations (CLOs) are also attracting increasing attention from wealth managers. Sometimes confused with CDOs – which were the highly complex instruments made infamous during the 2008 global financial crisis – CLOs are different instruments backed by diversified, transparent corporate credit.
The $1.4tn (£1.05tn) CLO asset class continues to mature and displays strong fundamentals, with AAA and AA tranches never defaulting in history. We expect ongoing demand for this segment of the market, as it continues to offer some of the widest spreads among investment grade assets.
Within equities, we are receiving questions about ‘quantamental’ strategies – the intersection of fundamental and quantitative investing. In recent years, many investors have moved from high-active-share, concentrated portfolios to broader passive exposures or enhanced beta. Quantamental strategies represent a sophisticated evolution of that core building block, blending systematic insights with fundamental analysis.
How are you planning to address and serve that interest?
While access to CLOs has historically been limited to the institutional market, we were able to capitalise on our $77bn CLO platform to launch a UCITS vehicle for a broader investor base this summer. We have been incredibly pleased with early interest in the PGIM Global AAA CLO fund, which our clients are using as a complementary holding alongside traditional fixed income assets to improve a portfolio’s overall efficiency and diversification.
More broadly, with fixed income markets prone to extreme movements amid a cascade of headlines, the ability to flexibly move across bond market segments remains a powerful tool. With economies and policies set to diverge further in 2026 and beyond, the managers of our PGIM Multi-Sector Credit fund understand the importance of positioning in the right parts of the yield curve, in the right sectors and in the right currencies.
Are you seeing a divergence in the demands of UK wealth managers versus, for example, their peers in Europe or on the institutional side in the UK?
Even though institutional investors are still further along in their allocations to private markets, we are now seeing significant momentum in the wealth space. Education, regulatory support and greater access to institutional-quality vehicles are all contributing to this shift. Wealth managers increasingly recognise that private markets can enhance diversification and improve portfolio resilience.
Beyond private markets, we are witnessing accelerating innovation in the wealth space. There is heightened appeal for bespoke mandates, flexible structures – such as QIFs – and portfolio overlays that sit outside the traditional UCITS framework. Consolidation and fee pressure remain universal themes, and wealth firms are continually looking to do more with fewer trusted asset management partners.
As a business, how do you define ‘alternative’ and ‘private’ assets, and to what extent should asset managers be looking to service investor demand here?
Many managers in the market today are coming from a private credit background and expanding into public markets, which is why you see numerous partnerships between private credit managers and traditional public fixed income groups. There are very few managers who have a longstanding history and deep expertise in both.
At PGIM, we have one of the world’s largest multi-sector credit businesses, and that public market expertise is complemented by our extensive history in private alternatives. It allows us to leverage internal expertise to create and manage these portfolios holistically, without splitting capabilities across different businesses. We can also draw lessons from the institutional world, where hybrid public-private approaches are becoming more common.
‘ESG is dead – long live ESG 2.0’ – your thoughts as a distributor, please?
There is no question that the intense focus on sustainability has cooled, as have flows into dedicated ESG-labelled funds. The world still faces an enormous transition challenge over the coming decades, however, and capital will play a vital role in financing it.
Our PGIM Jennison Carbon Solutions Equity fund was launched to tap into a far broader opportunity set than just renewables or electric vehicles. With global energy demand continuing to rise due to ongoing digitalisation and the advent of AI, there is a pressing need for cleaner solutions.
Decarbonisation will take a huge effort from many industries over a long period of time. Our approach leverages renewable energy to achieve decarbonisation while incorporating transitional solutions, such as natural gas and nuclear power, to accelerate progress toward that goal.
What drives your approach to client communication? And is there a case for focusing on attracting the ‘right’ type of client?
Our approach is built entirely on partnership. One person cannot effectively cover the large, sophisticated relationships we manage today. As clients in the wealth space have institutionalised their own approach – a natural outcome of consolidation and centralisation – we have had to adapt to meet them. That means building a distribution team structured for where the market is going, not where it has been.
Outside of work, what is the strangest thing you have ever seen or done?
Having young kids means living in a constant state of delightful weirdness. The strangest thing? Probably the time I had a very serious conversation about why the moon does not fall on our house. It started as a bedtime question and turned into a full-blown physics lesson with Lego models. Life with kids is like living in a surreal comedy show and you just roll with it. Nothing humbles you faster than explaining gravity to a four-year-old who is convinced the moon is stalking them.
May we have two book recommendations, please – ideally, one with an investment connection?
In the finance and business world, Loonshots by Safi Bahcall. It challenges the conventional view that culture alone drives innovation and instead explores how organisations can balance creativity with disciplined execution. It is a thought-provoking read that broadens our understanding of growth and transformation.
As for fiction, I have recently been enjoying a sci-fi book series by Matt Dinniman called Dungeon Crawler Carl. It is set in a dystopian world where aliens turn Earth into a televised dungeon game show. It is bizarre, but oddly fitting for the unpredictable times we live in.
Gazing into your crystal ball, what does the asset management sector look like 10 years from now?
Two major shifts stand out. The first is the intergenerational wealth transfer – both vertically, from parents to children, and horizontally, from men to women. It is already happening, but both wealth and asset management firms will need to do more to be fully prepared for the structural changes.
The second is AI adoption. Right now, tools such as AI are largely used for productivity gains, but in the years ahead, they will be deeply embedded in research, client-servicing and portfolio management. The winners will be the asset managers that can integrate these technologies to improve both process and outcomes – not just efficiency.
“As clients in the wealth space have institutionalised their own approach, we have had to adapt to meet them. That means building a distribution team structured for where the market is going, not where it has been.
