Jennison Associates Celebrates 25 Years of Small Cap Core Equity Strategy
Jennison Associates proudly celebrates the 25th year of its active Small Cap Core Equity Strategy, which seeks to outperform the Russell 2000® Index by uncovering companies with attractive valuations based on strong projected earnings growth.
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“The global change in market conditions coupled with improved M&A activity nearing pre-pandemic levels suggests there may be meaningful opportunity for a small-cap run.” - Jason M. Swiatek, CFA, Managing Director, Jennison Associates (Photo: Business Wire)
With $2.5 billion in assets under management as of March 31, 2023, the small-cap strategy is rooted in a fundamental bottom-up, research-intensive approach that focuses on rigorous business evaluation across a diversified composition of small-cap companies built to weather different market conditions. Holdings span across various industries and sectors and are expertly selected based on their competitive positioning, balance sheet flexibility, and strong, stable growth profiles.
Since its inception in April 1998, the strategy has returned 805.9% versus 410.0% for the Russell 2000® Index (“benchmark”) on a cumulative net-of-fee basis. The strategy’s annualized net-of-fee returns for the 1-, 5- and 10-year periods ending April 30, 2023, are ‑3.3%, 7.7% and 10.0% compared to the benchmark’s -3.7%, 4.2% and 7.9% returns, respectively.
The small-cap team is led by Jason M. Swiatek, CFA, managing director at Jennison Associates, and includes nine dedicated investment professionals who each have, on average, over 19 years of industry experience. Portfolio managers including Swiatek, Eric Sartorius, CFA, and Jonathan Shapiro have worked together on the team for 10 years.
“The global change in market conditions coupled with improved M&A activity nearing pre‑pandemic levels suggests there may be meaningful opportunity for a small-cap run,” said Swiatek.1 “A core strategy tends to offer investors greater flexibility to capitalize on various economic backdrops, as well as broader diversification to help offset concentration risk.”
The strategy is available to investors via Institutional Separate Accounts and Collective Investment Trusts.
ABOUT JENNISON ASSOCIATES LLC
Founded in 1969, Jennison Associates offers a range of equity and fixed income investment strategies. Its equity expertise spans styles, geographies and market capitalizations. Its fixed income capability includes investment-grade active and structured strategies of various durations. Original fundamental research, specialized investment teams, strong client focus, and highly experienced investment professionals are among the firm’s competitive distinctions. As of March 31, 2023, Jennison managed $175 billion in client assets. Jennison is an affiliate manager of PGIM, the global asset management business of Prudential Financial, Inc. (NYSE: PRU). For more information, please visit jennison.com.
Jennison Associates LLC has not been licensed or registered to provide investment services in any jurisdiction outside the United States. Certain investment vehicles are distributed or offered through Prudential Investment Management Services LLC (also a Prudential Financial company) or other affiliated entities. Additionally, vehicles may not be registered or available for investment in all jurisdictions.
ABOUT PGIM
PGIM is the global asset management business of Prudential Financial, Inc. (NYSE: PRU), a leading global investment manager with more than $1.2 trillion in assets under management as of March 31, 2023. With offices in 18 countries, PGIM’s businesses offer a range of investment solutions for retail and institutional investors around the world across a broad range of asset classes, including public fixed income, private fixed income, fundamental equity, quantitative equity, real estate and alternatives. For more information visit pgim.com.
Prudential Financial, Inc. (PFI) of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom, or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom. For more information please visit news.prudential.com.
1 November 2022. Source: McKinsey & Company: Strategic M&A in U.S. banking: Creating value in uncertain times.
Source: Jennison and FTSE Russell. Inception of Small Cap Core Equity Composite: 4/30/98. Periods greater than 1 year are annualized unless otherwise noted. See Disclosures below and visit jennison.com/gips-small-cap-core-equity-composite for the latest Small Cap Core Equity Composite presentation for additional performance and fee information, criteria for composite performance creation, and term definitions. Past performance does not guarantee future results. Performance results are calculated in U.S. dollars and reflect reinvestment of dividends and other earnings. The net of fee performance is presented net of Jennison’s actual advisory fees and transaction costs. Gross of fee performance is presented before custodial and Jennison’s actual advisory fees but after transaction costs.
There is no guarantee our objectives will be met. All investments contain risk, including possible loss of principal. The strategy may vary significantly from the benchmark in several ways including, but not limited to, sector and issuer weightings, portfolio characteristics, and security types. Asset allocation and diversification strategies do not assure a profit or protect against loss in declining markets.
Characteristics are intended to provide a general illustration of the investment strategy and considerations used by Jennison in managing that strategy during normal market conditions and may change over time. Characteristics do not represent actual portfolio guidelines, which are negotiated with clients.
As of 6/5/2023. The views expressed herein are those of Jennison investment professionals at the time the comments were made and may not be reflective of their current opinions and are subject to change without notice and should not be considered investment advice.
Certain third-party information in this document has been obtained from sources that Jennison believes to be reliable as of the date presented; however, Jennison cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. Jennison has no obligation to update any or all such third-party information. There is no assurance that any forecasts, targets, or estimates will be attained.
For informational purposes only and not for redistribution. This information is not intended as investment advice and is not a recommendation about managing or investing assets. Jennison makes no representations regarding the suitability of any securities, financial instruments or strategies described herein. In providing this information, Jennison is not acting as your fiduciary. This information does not purport to provide any legal, tax or accounting advice.
When comparing the performance of a manager to its benchmark(s), please note that the manager’s holdings and portfolio characteristics may differ from those of the benchmark(s). Additional factors affecting the performance displayed herein may include portfolio rebalancing, the timing of cash flows, and differences in volatility, none of which impact the performance of the financial indexes. Financial indexes are unmanaged and assume reinvestment of dividends but do not reflect the impact of fees, applicable taxes, or trading costs which may also reduce the returns shown.
The financial indexes referenced herein are provided for informational purposes only. All indexes referenced in this commentary are registered trade names or trademark/service marks of third parties. References to such trade names or trademark/service marks and data are proprietary and confidential and cannot be redistributed without Jennison’s prior consent. Investors cannot directly invest in an index.
The Russell 2000® Index measures the performance of the small-cap segment of the U.S. equity universe.
2023-29635
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