PGIM Active Aggregate Bond ETF

PGIM Active Aggregate Bond ETF (PAB) is an actively managed fund from PGIM (Prudential). It holds investment-grade US dollar bonds, mainly Treasurys, mortgage-backed securities and corporate debt. It draws heavily on the Bloomberg US Aggregate Bond Index but does not try to copy it. Its 0.19% expense ratio is more than six times the 0.03% charged by index rivals such as AGG and SCHZ. With about $98 million in assets, it is also far smaller.

• Over the year to Oct 27, 2026, PAB returned -1.1%, 4th of 8 among similar funds.
• Its 5-year annualized return was -0.2%.
• Its worst full calendar year was 2022 (-14.2%); its best was 2025 (+7.5%).
• The deepest fall in its price history was 19.3% (Aug 2, 2021 to Oct 24, 2022), recovered by Feb 13, 2026.

As of Aug 31, 2026, the fund held 413 securities; the ten largest made up 25.19% of assets, and 2.07% sat in cash and money-market holdings.

The bonds mature in 14.1 years on average (weighted by size), with an average coupon of 3.81%.

• Over the three months to Aug 31, 2026, investors added a net $29.1M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.30%, -1.32%, +0.38%.

The fund puts at least 80% of its investable assets in bonds. These can include US Treasury and agency debt, corporate bonds, mortgage-backed securities and asset-backed securities, including collateralized loan obligations (CLOs), which are bundles of business loans. Every bond must be investment grade (rated BBB- or Baa3 or higher) when the fund buys it. Everything is in US dollars, and up to 25% can come from foreign issuers, including emerging markets.

The fund is not an index fund. Its managers start with views on the economy, interest rates and policy. They then research individual issuers and give each one an internal rating, with help from in-house computer models. They may buy a bond for its expected total return rather than its yield. There is no fixed rebalancing schedule. The fund trades often, and portfolio turnover was 175%.

Holders should understand three mechanics. First, the fund uses derivatives to manage duration (how sensitive it is to rate changes), to hedge and to try to add return. As of August 31, 2026, it held 33 derivative positions, including credit default swaps, interest-rate swaps and Treasury futures. Second, about 5.9% sat in other PGIM ETFs, such as PGIM AAA CLO ETF (PAAA) at 4.6%. Third, the fund may process share creations and redemptions in cash. That can force it to realize taxable gains.

• PAB charges 0.19% a year, versus an average of 0.09% for the similar funds below (7th of 8, cheapest first).
• The fee includes a 0.01% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $19 in the first year and $254 over 10 years (assuming a 5% annual return).

Its broad mix of investment-grade Treasurys, mortgage bonds and corporate debt is the type of bond fund that often anchors the bond side of a portfolio.

PAB launched in April 2021, so it has no record in the 2008 crisis or the 2020 COVID crash. In the 2022 bear market, rising interest rates pushed bond prices down. The fund fell 15.7% and took 35 months, until September 2025, to recover. Its worst calendar year was 2022, at -14.1%. Its deepest drop was 19.3%, from August 2021 to October 2022, and recovery took about 40 months, until February 2026. Anyone who sold shares for spending during that stretch would have locked in losses.

The trailing 12-month yield was 4.66% as of October 27, 2026, and the fund pays income monthly. It costs 0.19% a year, about $19 on $10,000 in the SEC's standard example. Several index rivals charge 0.03%. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).