PGIM INCOME BUILDER FUND | |||||
A: PCGAX | B: PBCFX | C: PCCFX | R: PCLRX | Z: PDCZX | R6: PCGQX |
IMPORTANT INFORMATION |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (www.pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report. |
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an e-mail request to PGIM Investments at shareholderreports@pgim.com. |
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund. |
To enroll in e-delivery, go to pgiminvestments.com/edelivery | |
As with all mutual funds, the Securities and Exchange Commission has not approved or disapproved the Fund's shares, nor has the SEC determined that this prospectus is complete or accurate. It is a criminal offense to state otherwise.Mutual funds are distributed by Prudential Investment Management Services LLC, a Prudential Financial company, member SIPC. Jennison Associates LLC and PGIM, Inc. (PGIM) are registered investment advisers and Prudential Financial companies. QMA is the primary business name of QMA LLC, a wholly owned subsidiary of PGIM. PGIM Fixed Income and PGIM Real Estate are units of PGIM. © 2019 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, the Prudential logo, and the Rock symbol are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. | ![]() |
Shareholder Fees (fees paid directly from your investment) | ||||||
Class A | Class B | Class C | Class R | Class Z | Class R6 | |
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | 4.50% | None | None | None | None | None |
Maximum deferred sales charge (load) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% | 5.00% | 1.00% | None | None | None |
Maximum sales charge (load) imposed on reinvested dividends and other distributions | None | None | None | None | None | None |
Redemption fee | None | None | None | None | None | None |
Exchange fee | None | None | None | None | None | None |
Maximum account fee (accounts under $10,000) | $15 | $15 | $15 | None | None* | None |
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Class A | Class B | Class C | Class R | Class Z | Class R6 | |
Management fees | 0.70% | 0.70% | 0.70% | 0.70% | 0.70% | 0.70% |
Distribution and service (12b-1) fees | 0.30% | 1.00% | 1.00% | 0.75% | None | None |
Other expenses | 0.28% | 1.66% | 0.26% | 1.03% | 0.27% | 0.35% |
Acquired Fund fees and expenses | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% |
Total annual Fund operating expenses | 1.38% | 3.46% | 2.06% | 2.58% | 1.07% | 1.15% |
Fee waiver and/or expense reimbursement | (0.43)% | (1.76)% | (0.36)% | (1.38)% | (0.37)% | (0.45)% |
Total annual Fund operating expenses after fee waiver and/or expense reimbursement(1,2) | 0.95% | 1.70% | 1.70% | 1.20% | 0.70% | 0.70% |
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If Shares Are Redeemed | If Shares Are Not Redeemed | |||||||
Share Class | 1 Year | 3 Years | 5 Years | 10 Years | 1 Year | 3 Years | 5 Years | 10 Years |
Class A | $543 | $827 | $1,132 | $1,997 | $543 | $827 | $1,132 | $1,997 |
Class B | $673 | $1,199 | $1,747 | $2,913 | $173 | $899 | $1,647 | $2,913 |
Class C | $273 | $611 | $1,075 | $2,361 | $173 | $611 | $1,075 | $2,361 |
Class R | $122 | $671 | $1,246 | $2,812 | $122 | $671 | $1,246 | $2,812 |
Class Z | $72 | $304 | $554 | $1,272 | $72 | $304 | $554 | $1,272 |
Class R6 | $72 | $321 | $589 | $1,357 | $72 | $321 | $589 | $1,357 |
4 | PGIM Income Builder Fund |
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6 | PGIM Income Builder Fund |
■ | regulation by various government authorities; |
■ | government regulation of rates charged to customers; |
■ | service interruption due to environmental, operational or other mishaps as well as political and social unrest; |
■ | the imposition of special tariffs and changes in tax laws, regulatory policies and accounting standards; and |
■ | general changes in market sentiment towards the assets of infrastructure companies. |
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8 | PGIM Income Builder Fund |
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Average Annual Total Returns % (including sales charges) (as of 12-31-18) | ||||
Return Before Taxes | One Year | Five Years | Ten Years | Since Inception |
Class A shares | -10.73% | 0.72% | 5.43% | - |
Class B shares | -11.72% | 0.75% | 5.13% | - |
Class C shares | -8.13% | 0.91% | 5.13% | - |
Class R shares | -6.76% | 1.43% | 5.66% | - |
Class R6 shares | -6.35% | N/A | N/A | 0.67%(12-30-16) |
Class Z Shares % (as of 12-31-18) | ||||
Return Before Taxes | -6.24% | 1.94% | 6.20% | - |
Return After Taxes on Distributions | -7.45% | -0.25% | 4.75% | - |
Return After Taxes on Distributions and Sale of Fund Shares | -3.44% | 0.91% | 4.62% | - |
Index % (reflects no deduction for fees, expenses or taxes) (as of 12-31-18) | ||||
S&P 500 Index | -4.38% | 8.49% | 13.11% | - |
Bloomberg Barclays US Aggregate Bond Index | 0.01% | 2.52% | 3.48% | - |
Investment Manager | Subadvisers | Portfolio Managers | Title | Service Date |
PGIM Investments LLC | QMA LLC | Edward L. Campbell, CFA | Managing Director and Portfolio Manager | September 2014 |
Rory Cummings, CFA | Vice President and Portfolio Manager | September 2014 | ||
Peter Vaiciunas, CFA | Vice President and Portfolio Manager | February 2018 | ||
Jennison Associates LLC | Ubong “Bobby” Edemeka | Managing Director | September 2014 | |
Shaun Hong, CFA | Managing Director | September 2014 | ||
Stephen J. Maresca, CFA | Managing Director | July 2016 | ||
PGIM Fixed Income PGIM Limited | David Bessey | Managing Director and Co-Head of PGIM Fixed Income's Emerging Markets Debt Team | September 2014 |
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Investment Manager | Subadvisers | Portfolio Managers | Title | Service Date |
Cathy L. Hepworth, CFA | Managing Director and Co-Head of PGIM Fixed Income's Emerging Markets Debt Team | September 2014 | ||
Mariusz Banasiak, CFA | Principal and Head of PGIM Fixed Income’s Foreign Exchange Team | June 2017 | ||
Robert Cignarella, CFA | Managing Director and Head of PGIM Fixed Income’s Leveraged Finance Team | September 2014 | ||
Brian Clapp, CFA | Principal and a high yield portfolio manager | September 2014 | ||
Robert Spano, CFA, CPA | Principal and a high yield portfolio manager | September 2014 | ||
Daniel Thorogood, CFA | Vice President and a high yield portfolio manager | September 2014 | ||
Ryan Kelly, CFA | Principal and a high yield portfolio manager | September 2014 | ||
PGIM Real Estate | Rick J. Romano, CFA | Managing Director and Head of Global Real Estate Securities | September 2014 | |
Daniel Cooney, CFA | Executive Director and Portfolio Manager: North American Real Estate Securities | June 2018 | ||
Kwok Wing Cheong, CFA | Executive Director and Portfolio Manager: Asian Real Estate Securities | May 2015 | ||
PGIM Limited | Michael Gallagher | Executive Director and Portfolio Manager: European Real Estate Securities | September 2014 |
Class A** | Class C** | Class R** | Class Z** | Class R6 | |
Minimum initial investment* | $1,000 | $1,000 | None | None | None |
Minimum subsequent investment* | $100 | $100 | None | None | None |
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12 | PGIM Income Builder Fund |
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14 | PGIM Income Builder Fund |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Equity | PGIM Jennison MLP Fund(1) | The Fund seeks to provide total return through a combination of current income and capital appreciation. The Fund normally invests at least 80% of its investable assets in MLPs and MLP related investments (together, MLP investments). The Fund’s investments may be of any capitalization size. The Fund’s MLP investments may include, but are not limited to: MLPs structured as LPs or LLCs; MLPs that are taxed as “C” corporations; I-Units issued by MLP affiliates; parent companies of MLPs; shares of companies owning MLP general partnership interests and other securities representing indirect beneficial interest ownership interests in MLP common units, “C” corporations that hold significant interests in MLPs; and other equity and fixed income securities and derivative instruments, including pooled investment vehicles and ETPs, that provide exposure to MLP investments, or have economic characteristics similar to MLP investments. MLPs generally own and operate assets that are used in the energy sector, including assets used in exploring, developing, producing, generating, transporting (including marine), transmitting, terminal operation, storing, gathering, processing, refining, distributing, mining or marketing of natural gas, natural gas liquids, crude oil, refined products, coal or electricity, or that provide energy related equipment or services. Many of the MLPs in which the Fund invests operate oil, gas or petroleum facilities, or other facilities within the energy sector. The Fund intends to concentrate its investments in the energy sector. In deciding which stocks to buy, the investment subadviser relies on proprietary fundamental research, focused on the discovery of quality companies with predictable and sustainable cash flows. In narrowing the investment universe, the investment team compares prospective candidates’ competitive positioning, including strategically located assets; distribution coverage ratios; organic growth opportunities; expected dividend or distribution growth; the quality of the management team; balance sheet strength; and the support of the general partner. Valuation and the investment’s degree of liquidity factor into the portfolio managers’ decision calculus, as well. The team also monitors wider industry dynamics and interacts continually with the investment subadviser’s Natural Resources investment professionals to gain insights into emerging trends, such as the anticipation of an acceleration or reduction in production of particular oil and gas plays or a shift in regulatory or tax policy, which could affect potential or current positions. |
Equity | PGIM Jennison Utility Fund(1) | The Fund seeks total return through a combination of capital appreciation and current income. The Fund seeks investments whose prices will increase as well as pay the Fund dividends and other income. The Fund normally invests at least 80% of the Fund's investable assets in equity and equity-related and investment-grade debt securities of utility companies. This means the Fund concentrates its investments in utility companies, including electric utilities, gas utilities, water utilities, multi-utilities, independent power producers, diversified telecommunication services, wireless telecommunication services and oil & gas storage & transportation. The Fund may invest more than 5% of the Fund's assets in any one issuer. The Fund may invest up to 50% of its investable assets in foreign securities. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Equity | PGIM Jennison Global Infrastructure Fund(1) | The Fund seeks total return. The Fund normally will invest at least 80% of its investable assets in securities of US and foreign (non-US based) infrastructure companies. The Fund will consider a company an infrastructure company if the company is categorized, based on the Global Industry Classification Standard (GICS) industry classifications, as they may be amended from time to time, within the following industries: Aerospace and Defense, Air Freight and Logistics, Airlines, Building Products, Commercial Services and Supplies, Communications Equipment, Construction and Engineering, Construction Equipment, Diversified Telecommunication Services, Electrical Equipment, Electric Utilities, Energy Equipment and Services, Gas Utilities, Health Care Providers and Services, Independent Power Producers and Energy Traders, Industrial Conglomerates, Machinery, Marine, Metals and Mining, Multi-Utilities, Oil, Gas and Consumable Fuels, Rail and Road, Transportation Infrastructure, Water Utilities and Wireless Telecommunication Services, and the following infrastructure-related real estate investment trusts (REITs) identified under the GIC Sub-Industry classifications: Industrial REITs, Health Care REITs, and Specialized REIT. Examples of assets held by infrastructure companies include toll roads, airports, rail track, shipping ports, telecom infrastructure, hospitals, schools, utilities such as electricity, gas distribution networks and water, and oil and gas pipelines. |
Equity | PowerShares Preferred Portfolio(3) | The Fund seeks investment results that generally correspond to the price and yield (before fees and expenses) of The BofA Merrill Lynch Core Plus Fixed Rate Preferred Securities Index (the “Index”). The Fund normally will invest at least 80% of its total assets in fixed rate US dollar-denominated preferred securities that comprise the Index. The Index tracks the performance of fixed rate US dollar-denominated preferred securities issued in the US domestic market. Securities must be rated at least B3, based on an average of three leading ratings agencies: Moody’s, S&P and Fitch, Inc. (Fitch) and must have an investment-grade country risk profile (based on an average of Moody’s, S&P and Fitch foreign currency long-term sovereign debt ratings). The Fund will concentrate its investments (i.e., invest 25% or more of the value of its total assets) in securities of issuers in any one industry or sector only to the extent that the Index reflects a concentration in that industry or sector. |
Equity | iShares U.S. Preferred Stock ETF(4) | The Fund seeks to track the investment results of an index composed of U.S. preferred stocks. The Fund seeks to track the investment results of the S&P U.S. Preferred Stock IndexTM (the “Underlying Index”), which measures the performance of a select group of preferred stocks listed on the New York Stock Exchange (“NYSE”), NYSE Arca, Inc. (“NYSE Arca”), NYSE Amex, NASDAQ Global Select Market, NASDAQ Select Market or NASDAQ Capital Market. The Underlying Index does not seek to directly reflect the performance of the companies issuing the preferred stock. The Underlying Index includes preferred stocks with a market capitalization over $100 million that meet minimum price, liquidity, trading volume, maturity and other requirements determined by S&P Dow Jones Indices LLC (the “Index Provider” or “SPDJI”), a subsidiary of S&P Global, Inc. The Underlying Index excludes certain issues of preferred stock, such as those that are issued by special ventures (e.g., toll roads or dam operators) or structured products and brand name products issued by financial institutions that are packaged securities linked to indices or other stocks. |
Equity | SPDR Wells Fargo Preferred Stock ETF(3) | The SPDR Wells Fargo Preferred Stock ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of an index based upon Preferred Securities. In seeking to track the performance of Wells Fargo Hybrid and Preferred Securities Aggregate Index (the “Index”), the Fund employs a sampling strategy, which means that the Fund is not required to purchase all of the securities represented in the Index. Instead, the Fund may purchase a subset of the securities in the Index in an effort to hold a portfolio of securities with generally the same risk and return characteristics of the Index. The quantity of holdings in the Fund will be based on a number of factors, including asset size of the Fund. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Equity | PGIM QMA Strategic Alpha International Equity ETF(5) | The Fund’s investment objective is to seek long-term growth of capital. The Fund seeks investments that will appreciate over time. The Fund’s goal is to outperform the returns of the MSCI EAFE Index over the long term. Under normal circumstances, the Fund invests at least 80% of its investable assets in equity and equity-related securities of non-US companies. The Fund is an actively managed ETF and, thus, does not seek to replicate the performance of a specified index. The Fund may invest anywhere in the world, but generally not in US companies. The Fund may invest a large portion of its assets in a single country or region. The Fund will primarily invest in developed markets. The Fund may invest in securities of the issuers of any market capitalization size. |
Equity | PGIM QMA Strategic Alpha Large-Cap Core ETF(5) | The Fund’s investment objective is to seek long-term growth of capital. The Fund seeks investments that will appreciate over time. The Fund’s goal is to outperform the returns of the S&P 500 Index over the long term. The Fund normally invests at least 80% of its investable assets in equity and equity-related securities of US large-capitalization companies. The Fund is an actively managed ETF and, thus, does not seek to replicate the performance of a specified index. |
Equity | PGIM QMA Strategic Alpha Small-Cap Growth ETF(5) | The Fund’s investment objective is to seek long-term growth of capital. The Fund seeks investments that will appreciate over time. The Fund’s goal is to outperform the returns of the Russell 2000 Growth Index over the long term. The Fund normally invests at least 80% of its investable assets in equity and equity-related securities of US small-capitalization companies. The Fund is an actively managed ETF and, thus, does not seek to replicate the performance of a specified index. |
Equity | PGIM QMA Strategic Alpha Small-Cap Value ETF(5) | The Fund’s investment objective is to seek long-term growth of capital. The Fund seeks investments that will appreciate over time. The Fund’s goal is to outperform the returns of the Russell 2000 Value Index over the long term. The Fund normally invests at least 80% of its investable assets in equity and equity-related securities of US small-capitalization companies. The Fund is an actively managed ETF and, thus, does not seek to replicate the performance of a specified index. |
Equity | PGIM QMA International Equity Fund(5) | The Fund’s investment objective is to seek long-term growth of capital. The subadviser looks for investments that it thinks will increase in value over time. The subadviser seeks to achieve the Fund’s objective through investment in equity and equity-related securities of foreign (non-US based) companies. Under normal circumstances, the Fund invests at least 80% of its investable assets (net assets plus borrowings made for investment purposes) in common stock and preferred stock of foreign companies. The Fund may invest anywhere in the world, including North America, Western Europe, the United Kingdom and the Pacific Basin, but generally does not invest in the US. The Fund may invest in securities of the issuers of any market capitalization size. The Fund may invest a large portion of its assets in a single country or region. The Fund may invest in emerging markets. |
Equity | PGIM QMA Emerging Markets Equity Fund(5) | The Fund’s investment objective is to seek to provide returns in excess of the Morgan Stanley Capital International Emerging Markets Index over full market cycles. The Fund seeks to achieve its investment objective by investing, under normal conditions, at least 80% of its investable assets (net assets plus any borrowings for investment purposes) in the equity and equity-related securities of companies located in or otherwise economically tied to emerging markets countries. The Fund may invest in securities of issuers of any market capitalization size. The Fund may invest a large portion of its assets in a single country or region. The Fund is not sponsored by or affiliated with Morgan Stanley Capital International (MSCI). The Fund may invest in equity and equity-related securities (which include but are not limited to, common and preferred stock, exchange-traded funds (ETFs), securities convertible into common stock, structured securities including participation notes (P-Notes) and structured notes (S-Notes), depositary receipts, and other instruments whose value is based on common stock, such as rights and warrants) and derivatives. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Fixed Income | PGIM Short-Term Corporate Bond Fund(2) | The Fund seeks high current income consistent with the preservation of principal. The Fund invests, under normal circumstances, at least 80% of its investable assets in bonds of corporations with varying maturities. For purposes of this policy, bonds include all fixed income securities, other than preferred stock, and corporations include all private issuers. The effective duration of the Fund's portfolio will generally be less than three years. The Fund will buy and sell securities to take advantage of investment opportunities based on the subadviser's fundamental credit research as well as analysis of market conditions, interest rates and general economic factors. |
Fixed Income | PGIM Short Duration High Yield Income Fund(2) | The Funds seeks to provide a high level of current income. The Fund will seek to achieve its investment objective by investing primarily in a diversified portfolio of high yield fixed income instruments that are rated below investment grade by a NRSRO or, if unrated, are considered by the investment subadviser to be of comparable quality. Under normal market conditions, the Fund will invest at least 80% of its investable assets in a diversified portfolio of high yield fixed income instruments that are below investment grade (commonly referred to as junk bonds) with varying maturities and other investments (including derivatives) with similar economic characteristics. The term “below investment grade” refers to instruments either rated Ba1 or lower by Moody’s, BB+ or lower by S&P or Fitch, or comparably rated by another NRSRO, or, if unrated, are considered by the investment subadviser to be of comparable quality. Although the Fund may invest in instruments of any duration or maturity, the Fund normally will seek to maintain a weighted average portfolio duration of three years or less and a weighted average maturity of five years or less. |
Fixed Income | PGIM Floating Rate Income Fund(2) | The Fund seeks to maximize current income. In addition the Fund seeks capital appreciation as a secondary investment objective, but only when consistent with the Fund's primary investment objective of seeking to maximize current income. Under normal market conditions, the Fund will invest at least 80% of its investable assets (net assets plus borrowings for investment purposes, if any) in floating rate loans and other floating rate debt securities. Floating rate loans are debt obligations that have interest rates which adjust or “float” periodically (normally on a monthly or quarterly basis) based on a generally recognized base rate such as the London Interbank Offered Rate (LIBOR) or the prime rate offered by one or more major US banks. |
Fixed Income | PGIM Short Duration Multi-Sector Bond Fund(2) | The Fund seeks total return. The Fund seeks to achieve its objective by investing in fixed income instruments, whereby issuers borrow money from investors in return for either a fixed or variable rate of interest and eventual repayment of the amount borrowed. The Fund invests, under normal circumstances, at least 80% of the Fund's investable assets in fixed income instruments with varying maturities. The Fund has the flexibility to allocate its investments across different sectors of the fixed income securities markets. The Fund's investment subadviser allocates assets among different sectors of the fixed income markets, including (but not limited to) US Government securities, mortgage-related and asset-backed securities, corporate debt securities, foreign debt securities and loan participations and assignments. The Fund is not obligated to invest in all of these sectors at a given time and, at times, may invest all of its assets in only one sector. Although the Fund may invest in instruments of any duration or maturity, the Fund normally will seek to maintain a weighted average portfolio duration of three years or less and a weighted average maturity of five years or less. The Fund's weighted average portfolio duration, however, may be longer at any time or from time to time depending on market conditions. |
Fixed Income | PGIM Absolute Return Bond Fund(2) | The Fund seeks positive returns over the long term, regardless of market conditions. The Fund has a flexible investment strategy and will invest in a variety of securities and instruments. The Fund will also use a variety of investment techniques in pursuing its investment objective, which may include managing duration, credit quality, yield curve positioning and currency exposure, as well as sector and security selection. Under normal market conditions, the Fund will invest at least 80% of its investable assets in debt securities and/or investments that provide exposure to bonds. The Fund may invest up to 50% of its total assets in debt securities that are rated below investment grade (which are sometimes referred to as junk bonds) or, if unrated, of comparable quality at the time of purchase as determined by the Fund’s investment subadviser. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Fixed Income | SPDR® Bloomberg Barclays Convertible Securities ETF(6) | The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of an index that tracks US convertible securities markets. Under normal market conditions, the Fund generally invests substantially all, but at least 80%, of its total assets in the securities comprising the Index or in securities that are determined to have economic characteristics that are substantially identical to the economic characteristics of the securities that comprise the Index. In addition, the Fund may invest in debt securities that are not included in the Index, cash and cash equivalents or money market instruments, such as repurchase agreements and money market funds. |
Fixed Income | PGIM Government Income Fund(2) | The investment objective of the Fund is to seek high current return. The Fund invests, under normal circumstances, at least 80% of its investable assets in US Government securities, including US Treasury bills, notes, bonds, strips and other debt securities issued by the US Treasury, and obligations, including mortgage-related securities, issued or guaranteed by US Government agencies or instrumentalities. The Fund may also invest in derivatives, including futures, swaps, and options, for purposes of hedging and/or improving the Fund’s returns. Some (but not all) of the US Government securities and mortgage-related securities in which the Fund will invest are backed by the full faith and credit of the US Government, which means that payment of interest and principal is guaranteed, but yield and market value are not. Most, if not all, of the Fund's debt securities are “investment-grade.” This means major rating services, like S&P or Moody's, have rated the securities within one of their four highest quality grades. Debt obligations in the fourth highest grade are regarded as investment-grade, but have speculative characteristics and are riskier than higher rated securities. |
Fixed Income | PGIM Total Return Bond Fund(2) | The investment objective of the Fund is total return. The Fund will seek to achieve its objective through a mix of current income and capital appreciation as determined by the Fund's investment subadviser. The Fund invests, under normal circumstances, at least 80% of the Fund's investable assets in bonds. For purposes of this policy, bonds include all fixed income securities, other than preferred stock, with a maturity at date of issue of greater than one year. The Fund's investment subadviser allocates assets among different debt securities, including (but not limited to) US Government securities, mortgage-related and asset-backed securities, corporate debt securities and foreign securities. The Fund may invest up to 30% of its investable assets in speculative high risk, below investment-grade securities having a rating of not lower than CCC. These securities are also known as high-yield debt securities or junk bonds. The Fund may invest up to 30% of its investable assets in foreign debt securities. |
Fixed Income | PGIM Global Total Return Fund(2) | The Fund's investment objective is to seek total return, made up of current income and capital appreciation. The Fund seeks investments that will increase in value, as well as pay the Fund interest and other income. The Fund generally invests in global developed market sovereign, corporate, mortgage related, and asset-backed debt securities. The Fund may also invest in the debt securities of emerging market sovereign, quasi-sovereign, and corporate issuers. The Fund may invest in countries anywhere in the world, and normally invests at least 65% of its total assets in income-producing debt securities of US and foreign corporations and governments, supranational organizations, semi-governmental entities or government agencies, authorities or instrumentalities, investment-grade US or foreign mortgages and mortgage-related securities and US or foreign short-term and long-term bank debt securities or bank deposits. The Fund may invest in debt securities that are denominated in US dollars or foreign currencies. The Fund may invest up to 35% of its total assets in speculative lower-rated securities, also known as “junk” bonds, and unrated securities that the investment subadviser determines are of comparable quality to investment grade securities. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Fixed Income | iShares Convertible Bond ETF(4) | The Fund seeks to track the investment results of the Bloomberg Barclays U.S. Convertible Cash Pay Bond > $250MM Index (the “Underlying Index”). The Underlying Index is a subset of the Bloomberg Barclays U.S. Convertibles: Cash Pay Bonds Index, which is one of the four classes of the Bloomberg Barclays U.S. Convertibles Index (the “Parent Index”) (i.e., cash pay, zero coupon, preferred and mandatory convertible bonds) and measures the performance of the US dollar denominated convertibles market. The Underlying Index is market capitalization-weighted and consists of only cash pay convertible bonds. Cash pay convertible bonds allow the holder of the bond the option to convert into a pre-specified number of shares of the issuer’s common stock, but do not require conversion. |
Fixed Income | PGIM Emerging Markets Debt Local Currency Fund(2) | The Fund’s investment objective is to seek total return, through a combination of current income and capital appreciation. The Fund seeks to achieve its investment objective by investing under normal circumstances at least 80% of its investable assets in currencies of, and fixed-income instruments denominated in local currencies of, emerging market countries. The Fund may invest in derivatives, such as forward contracts, options, futures contracts or swap agreements, denominated in any currency. Such investments will be included under the 80% of assets policy noted above so long as the underlying asset of such derivative is a currency or fixed-income instrument denominated in the currency of an emerging market country and such investments are subject to the Fund's limit of investing up to 25% of its net assets in derivatives. The Fund may invest to a lesser extent in lesser-developed emerging market countries that are not included in standard emerging market benchmarks and are not widely followed by investors (commonly referred to as “frontier countries”). The Fund's investments may be highly concentrated in a geographic region or country and under normal circumstances the Fund will invest in at least three different countries, without limit as to the amount of Fund assets that may be invested in any single country. The Fund's fixed-income instruments may include bonds, debt securities and derivatives issued by various US and non-US public or private sector entities. The Fund may invest up to 50% of its net assets in junk bonds. The Fund is non-diversified, which means that it may invest its assets in a smaller number of issuers than a diversified fund. |
Fixed Income | PGIM Corporate Bond Fund(2) | The Fund’s investment objective is high current income consistent with the preservation of principal. The Fund normally invests at least 80% of its investable assets in bonds of corporations with varying maturities. For purposes of this policy, bonds include all fixed-income securities, adjustable rate securities and floating rate securities, other than preferred stock, and corporations include all private issuers. Although the Fund may invest in bonds of any maturity, under normal market conditions the Fund generally will maintain an effective duration approximately equal to the duration of the Fund’s benchmark, the Bloomberg Barclays US Credit Bond Index, plus or minus one year. The Fund may invest in asset-backed securities and mortgage-related securities, dollar-denominated obligations issued in the US by foreign corporations and governments, including those in emerging markets (Yankee obligations), and debt obligations issued by the US Government and government-related entities. The Fund may also invest up to 20% of its investable assets in below investment grade debt obligations (“junk bonds”) rated BB or lower by S&P, Ba or lower by Moody’s, or the equivalent by another NRSRO. The Fund may invest in unrated debt obligations that it determines are of comparable quality to the rated debt obligations that are permissible investments. The Fund engages in active trading in order to take advantage of new investment opportunities or yield differentials. |
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Underlying Funds | ||
Market Segment/ Strategy | Name of Underlying Fund | Investment Objective and Investment Strategies of Underlying Fund |
Fixed Income | PGIM Ultra Short Bond ETF(2) | The Fund’s investment objective is to seek total return through a combination of current income and capital appreciation, consistent with preservation of capital. The Fund seeks to achieve its investment objective by investing primarily in a portfolio of investment grade, U.S. dollar denominated short-term fixed, variable and floating rate debt instruments. Under normal market conditions, the Fund invests at least 80% of its investable assets in bonds with varying maturities. For purposes of this policy, bonds include fixed income instruments issued by the US Government, its agencies and instrumentalities, as well as commercial paper, money market instruments, asset-backed securities, funding agreements, variable rate demand notes, bills, notes and other obligations issued by banks, corporations and other companies (including trust structures), obligations issued by non-U.S. banks, companies or non-US governments, and municipal bonds and notes. The Fund is an actively managed exchange traded fund (ETF) and, thus, does not seek to replicate the performance of a specified index. Although the Fund may invest in instruments of any duration or maturity, the Fund normally will seek to maintain a weighted average portfolio duration of one year or less and a weighted average maturity of three years or less. |
Fixed Income | PGIM Active High Yield Bond ETF(2) | The Fund’s investment objective is to seek total return, through a combination of current income and capital appreciation. The Fund seeks to achieve its investment objective by investing primarily in a portfolio of high yield bonds (commonly referred to as junk bonds) of companies or governments. Under normal market conditions, the Fund invests at least 80% of its investable assets in a diversified portfolio of high yield bonds that are below investment grade and other investments (including derivatives) with similar economic characteristics. The term “bonds” includes fixed income instruments issued by the US Government, its agencies and instrumentalities, commercial paper, asset-backed securities, mortgage-backed securities, variable and floating rate instruments, bills, notes and other obligations issued by banks, corporations and other companies (including trust structures), convertible and non-convertible securities (including preferred stocks), loan participations and assignments, obligations issued by non-U.S. banks, companies or non-U.S. governments, and municipal bonds and notes.The Fund is an actively managed exchange traded fund (ETF) and, thus, does not seek to replicate the performance of a specified index. |
Real Estate | PGIM US Real Estate Fund(7) | The Fund’s investment objective is to seek capital appreciation and income. The Fund seeks to achieve its objective by investing in investments whose price will increase over time and which will pay the Fund dividends and other income, such as capital gains. The Fund normally invests at least 80% of its investable assets (net assets plus any borrowings made for investment purposes) in the equity-related securities of real estate companies operating in the United States, principally real estate investment trusts (REITs) and other real estate securities. The Fund may invest up to 20% of its investable assets in other securities, including equity-related securities of foreign real estate companies. The Fund is non-diversified, meaning that it may invest more than 5% of its total assets in any one issuer. The Fund concentrates its investments (i.e., invests at least 25% of its total assets) in the real estate sector. |
Real Estate | PGIM Global Real Estate Fund(7) | The Fund’s investment objective is to seek capital appreciation and income. The Fund seeks investments whose price will increase over time and which will pay the Fund dividends and other income. The Fund normally invests at least 80% of its investable assets (net assets plus any borrowings made for investment purposes) in the equity-related securities of real estate companies, principally real estate investment trusts (REITs), and other real estate securities. Equity-related securities may also include common stock, convertible securities, nonconvertible preferred stock, American Depositary Receipts (ADRs), warrants and other rights that can be exercised to obtain stock, investments in various types of business ventures and similar securities. The Fund invests globally in real estate investments. Under normal circumstances, the Fund invests in at least three different countries and at least 40% of its total assets in foreign securities, including emerging markets. There is no limit on the amount of Fund assets that may be invested in the securities of foreign real estate companies. The Fund concentrates its investments in real estate securities, including REITs. The Fund is non-diversified, meaning that it may invest more than 5% of its total assets in any one issuer. |
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Principal Strategies: Investment Limits |
■ Equity and Equity-Related Securities: May range between 20% to 80% of total assets■ Fixed Income Instruments: May range between 20% to 80% of total assets |
Certain Non-Principal Strategies: Investment Limits |
■ MLPs: Up to 25% of total assets ■ Derivatives: Up to 25% of total assets ■ Illiquid Securities: Up to 15% of net assets ■ Money Market Instruments: Up to 100% of total assets on a temporary basis ■ Short Sales (excluding Short Sales “against the box”): Up to 25% of net assets■ ETFs: Percentages vary |
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■ | regulation by various government authorities; |
■ | government regulation of rates charged to customers; |
■ | service interruption due to environmental, operational or other mishaps as well as political and social unrest; |
■ | the imposition of special tariffs and changes in tax laws, regulatory policies and accounting standards; and |
■ | general changes in market sentiment towards the assets of infrastructure companies. |
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Expected Distribution Schedule* | |
Dividends | Monthly |
Short-Term Capital Gains | Annually |
Long-Term Capital Gains | Annually |
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Share Class | Eligibility |
Class A** | Retail investors |
Class B* | Retail investors |
Class C** | Retail investors |
Class R** | Certain group retirement plans |
Class Z** | Certain group retirement plans, institutional investors and certain other investors |
Class R6 | Certain group retirement plans, institutional investors and certain other investors |
■ | Class A shares purchased in amounts of less than $1 million require you to pay a sales charge at the time of purchase, but the operating expenses of Class A shares are lower than the operating expenses of Class C shares. |
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Investors who purchase $1 million or more of Class A shares and sell these shares within 12 months of purchase are also subject to a contingent deferred sales charge (CDSC) of 1.00%. The CDSC is waived for certain retirement and/or benefit plans. |
■ | Class C shares do not require you to pay a sales charge at the time of purchase, but do require you to pay a CDSC if you sell your shares within 12 months of purchase. The operating expenses of Class C shares are higher than the operating expenses of Class A shares. |
■ | The amount of your investment and any previous or planned future investments, which may qualify you for reduced sales charges for Class A shares under Rights of Accumulation or a Letter of Intent. |
■ | The length of time you expect to hold the shares and the impact of varying distribution fees. Over time, these fees will increase the cost of your investment and may cost you more than paying other types of sales charges. For this reason, Class C shares are generally appropriate only for investors who plan to hold their shares for no more than 3 years. |
■ | The different sales charges that apply to each share class—Class A's front-end sales charge (and, in certain instances, CDSC) vs. Class C's CDSC. |
■ | Class C shares purchased in single amounts greater than $1 million are generally less advantageous than purchasing Class A shares. Purchase orders for Class C shares above this amount generally will not be accepted. |
■ | If you purchase Class Z shares through a broker acting solely as an agent on behalf of its customers pursuant to an agreement with PIMS, the broker may charge you a commission in an amount determined and separately disclosed to you by the broker. |
■ | Because Class Z and Class R6 shares have lower operating expenses than Class A or Class C shares, as applicable, you should consider whether you are eligible to purchase such share classes. |
Class A** | Class B* | Class C** | Class Z** | Class R** | Class R6 | |
Minimum purchase amount | $1,000 | $2,500 | $1,000 | None | None | None |
Minimum amount for subsequent purchases | $100 | $100 | $100 | None | None | None |
Maximum initial sales charge | 4.50% of the public offering price | None | None | None | None | None |
Contingent Deferred Sales Charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 5.00%(Year 1) 4.00%(Year 2) 3.00%(Year 3) 2.00%(Year 4) 1.00%(Years 5/6) 0.00%(Year 7) | 1.00% on sales made within 12 months of purchase | None | None | None |
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Class A** | Class B* | Class C** | Class Z** | Class R** | Class R6 | |
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% (0.25% currently) | 1.00% | 1.00% | None | 0.75% (0.50% currently) | None |
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Class A | Class C | Class Z | Class R | |
Existing Investors (Group Retirement Plans, IRAs, and all other investors) | No Change | No Change | No Change | No Change |
New Group Retirement Plans | Closed to group retirement plans wishing to add the share classes as new additions to plan menus on June 1, 2018, subject to certain exceptions below | |||
New IRAs | No Change | No Change | No Change | Closed to all new investors on June 1, 2018, subject to certain exceptions below |
All Other New Investors | No Change | No Change | No Change |
■ | Eligible group retirement plans that are exercising their one-time 90-day repurchase privilege in the Fund will be permitted to purchase such share classes. |
■ | Plan participants in a group retirement plan that offers Class A, Class C, Class R or Class Z shares of the Fund, as applicable, as of the Effective Date will be permitted to purchase such share classes of the Fund, even if the plan participant did not own shares of that class of the Fund as of the Effective Date. |
■ | Certain new group retirement plans will be permitted to offer such share classes of the Fund after the Effective Date, provided that the plan or its financial intermediary or other agent has or is actively negotiating a contractual agreement with the Fund’s distributor or service provider to offer such share classes of the Fund prior to or on the Effective Date. |
■ | New group retirement plans that combine with, replace or are otherwise affiliated with a current plan that invests in such share classes prior to or on the Effective Date will be permitted to purchase such share classes. |
■ | The Fund also reserves the right to refuse any purchase order that might disrupt management of the Fund or to otherwise modify the closure policy at any time on a case-by-case basis. |
■ | Shareholders owning Class C shares may continue to hold their Class C shares until the shares automatically convert to Class A shares under the conversion schedule, or until the shareholder redeems their Class C shares. |
Amount of Purchase | Sales Charge as a % of Offering Price* | Sales Charge as a % of Amount Invested* | Dealer Reallowance*** |
Less than $50,000 | 4.50% | 4.71% | 4.00% |
$50,000 to $99,999 | 4.00% | 4.17% | 3.50% |
$100,000 to $249,999 | 3.50% | 3.63% | 3.00% |
$250,000 to $499,999 | 2.50% | 2.56% | 2.00% |
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Amount of Purchase | Sales Charge as a % of Offering Price* | Sales Charge as a % of Amount Invested* | Dealer Reallowance*** |
$500,000 to $999,999 | 2.00% | 2.04% | 1.75% |
$1 million to $4,999,999** | None | None | 1.00% |
$5 million to $9,999,999** | None | None | 0.50% |
$10 million and over** | None | None | 0.25% |
■ | Use your Rights of Accumulation, which allow you or an eligible group of related investors to combine (1) the current value of Class A, Class B and Class C PGIM Fund shares you or the group already own, (2) the value of money market shares (other than Direct Purchase money market shares) you or an eligible group of related investors have received for shares of other PGIM Funds in an exchange transaction, and (3) the value of the shares you or an eligible group of related investors are purchasing; or |
■ | Sign a Letter of Intent, stating in writing that you or an eligible group of related investors will purchase a certain amount of shares in the Fund and other PGIM Funds within 13 months. |
■ | Purchases made prior to the effective date of the Letter of Intent will be applied toward the satisfaction of the Letter of Intent to determine the level of sales charge that will be paid pursuant to the Letter of Intent, but will not result in any reduction in the amount of any previously paid sales charge. |
■ | All accounts held in your name (alone or with other account holders) and taxpayer identification number (“TIN”); |
■ | Accounts held in your spouse's name (alone or with other account holders) and TIN (see definition of spouse below); |
■ | Accounts for your children or your spouse's children, including children for whom you and/or your spouse are legal guardian(s) (e.g., UGMAs and UTMAs); |
■ | Accounts in the name and TINs of your parents; |
■ | Trusts with you, your spouse, your children, your spouse's children and/or your parents as the beneficiaries; |
■ | With limited exclusions, accounts with the same address (exclusions include, but are not limited to, addresses for brokerage firms and other intermediaries and Post Office boxes); and |
■ | Accounts held in the name of a company controlled by you (a person, entity or group that holds 25% or more of the outstanding voting securities of a company will be deemed to control the company, and a partnership will be deemed to be controlled by each of its general partners), including employee benefit plans of the company where the accounts are held in the plan's TIN. |
■ | The person to whom you are legally married. We also consider your spouse to include the following: |
■ | An individual of the same gender with whom you have been joined in a civil union, or legal contract similar to marriage; |
■ | A domestic partner, who is an individual (including one of the same gender) with whom you have shared a primary residence for at least six months, in a relationship as a couple where you, your domestic partner or both provide for the personal or financial welfare of the other without a fee, to whom you are not related by blood; or |
■ | An individual with whom you have a common law marriage, which is a marriage in a state where such marriages are recognized between a man and a woman arising from the fact that the two live together and hold themselves out as being married. |
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■ | Mutual fund “wrap” or asset allocation programs, where the sponsor places fund trades, links its clients' accounts to a master account in the sponsor's name and charges its clients a management, consulting or other fee for its services; or |
■ | Mutual fund “supermarket” programs, where the sponsor links its clients' accounts to a master account in the sponsor's name and the sponsor charges a fee for its services. |
■ | Certain directors, officers, current employees (including their spouses, children and parents) and former employees (including their spouses, children and parents) of Prudential and its affiliates, the PGIM Funds, and the subadvisers of the PGIM Funds; former employees must have an existing investment in the Fund; |
■ | Persons who have retired directly from active service with Prudential or one of its subsidiaries; |
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■ | Registered representatives and employees of broker-dealers (including their spouses, children and parents) that offer Class A shares; |
■ | Investors in IRAs, provided that: (a) the purchase is made either from a directed rollover to such IRA or with the proceeds of a tax-free rollover of assets from a Benefit Plan for which Prudential Retirement (the institutional Benefit Plan recordkeeping entity of Prudential) provides administrative or recordkeeping services, in each case provided that such purchase is made within 60 days of receipt of the Benefit Plan distribution, and (b) the IRA is established through Prudential Retirement as part of its “Rollover IRA” program (regardless of whether or not the purchase consists of proceeds of a tax-free rollover of assets from a Benefit Plan described above); and |
■ | Clients of financial intermediaries, who (i) offer Class A shares through a no-load network or platform, (ii) charge clients an ongoing fee for advisory, investment, consulting or similar services, or (iii) offer self-directed brokerage accounts or other similar types of accounts that may or may not charge transaction fees to customers. |
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■ | Mutual fund “wrap” or asset allocation programs where the sponsor places fund trades, links its clients' accounts to a master account in the sponsor's name and charges its clients a management, consulting or other fee for its services; |
■ | Mutual fund “supermarket” programs where the sponsor links its clients' accounts to a master account in the sponsor's name and the sponsor charges a fee for its services; or |
■ | Fee- or commission-based retail brokerage programs of certain financial intermediaries that offer Class Z shares through such programs and that have agreements with PIMS to offer such shares when acting solely on an agency basis for their customers for the purchase or sale of such shares. If you transact in Class Z shares of the Fund through one of these programs, you may be required to pay a commission and/or other forms of compensation to the broker or financial intermediary for effecting such transaction. Because the Fund is not a party to any commission arrangement between you and your broker, any transactions in Class Z shares will be made by the Fund at net asset value (before imposition of the commission). Any such fee is paid by you, not by the Fund, and the imposition of any such fee or commission by your broker or financial intermediary does not impact the net asset value for such Fund shares. Shares of the Fund are available in other share classes that have different fees and expenses. |
■ | Certain participants in the MEDLEY Program (group variable annuity contracts) sponsored by Prudential for whom Class Z shares of the PGIM Funds are an available option; |
■ | Current and former Directors/Trustees of mutual funds managed by PGIM Investments or any other affiliate of Prudential; |
■ | Current and former employees (including their spouses, children and parents) of Prudential and its affiliates; former employees must have an existing investment in the Fund; |
■ | Prudential (including any program or account sponsored by Prudential or an affiliate that includes the Fund as an available option); |
■ | PGIM Funds, including PGIM funds-of-funds; |
■ | Qualified state tuition programs (529 plans); and |
■ | Investors working with fee-based consultants for investment selection and allocations. |
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■ | You are selling more than $100,000 of shares; |
■ | You want the redemption proceeds made payable to someone that is not in the Transfer Agent’s records; |
■ | You want the redemption proceeds sent to an address that is not in the Transfer Agent’s records; |
■ | You are a business or a trust; or |
■ | You are redeeming due to the death of the shareholder or on behalf of the shareholder. |
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■ | Amounts representing shares you purchased with reinvested dividends and distributions, |
■ | Amounts representing the increase in NAV above the total amount of payments for shares made during the past 12 months for Class A shares (in certain cases), six years for Class B shares, and 12 months for Class C shares, and |
■ | Amounts representing the cost of shares held beyond the CDSC period (12 months for Class A shares (in certain cases), six years for Class B shares, and 12 months for Class C shares). |
■ | After a shareholder is deceased or permanently disabled (or, in the case of a trust account, after the death or permanent disability of the grantor). This waiver applies to individual shareholders, as well as shares held in joint tenancy, provided the shares were purchased before the death or permanent disability; |
■ | To provide for certain distributions—made without IRS penalty—from a qualified or tax-deferred retirement plan, benefit plan, IRA or Section 403(b) custodial account; and |
■ | To withdraw excess contributions from a qualified or tax-deferred retirement plan, IRA or Section 403(b) custodial account. |
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■ | After a shareholder is deceased or permanently disabled (or, in the case of a trust account, after the death or permanent disability of the grantor). This waiver applies to individual shareholders, as well as shares held in joint tenancy, provided the shares were purchased before the death or permanent disability; |
■ | To provide for certain distributions—made without IRS penalty—from a qualified or tax-deferred retirement plan, benefit plan, IRA or Section 403(b) custodial account; |
■ | To withdraw excess contributions from a qualified or tax-deferred retirement plan, IRA or Section 403(b) custodial account; and |
■ | On certain redemptions effected through a Systematic Withdrawal Plan. |
■ | After a shareholder is deceased or permanently disabled (or, in the case of a trust account, after the death or permanent disability of the grantor). This waiver applies to individual shareholders, as well as shares held in joint tenancy, provided the shares were purchased before the death or permanent disability; |
■ | To provide for certain distributions—made without IRS penalty—from a qualified or tax-deferred retirement plan, benefit plan, IRA or Section 403(b) custodial account; and |
■ | To withdraw excess contributions from a qualified or tax-deferred retirement plan, IRA or Section 403(b) custodial account. |
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Class A Shares | ||||||||||
Year Ended October 31, | ||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||
Per Share Operating Performance(a): | ||||||||||
Net Asset Value, Beginning of Year | $9.12 | $9.62 | $9.36 | $9.39 | $11.90 | |||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | 0.36 | 0.35 | 0.35 | 0.37 | 0.39 | |||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.62 | (0.46) | 0.32 | 0.06 | (0.70) | |||||
Total from investment operations | 0.98 | (0.11) | 0.67 | 0.43 | (0.31) | |||||
Less Dividends and Distributions: | ||||||||||
Dividends from net investment income | (0.40) | (0.33) | (0.36) | (0.40) | (0.44) | |||||
Tax return of capital distributions | (0.01) | (0.06) | (0.05) | (0.06) | - | |||||
Distributions from net realized gains | - | - | - | - | (1.76) | |||||
Total dividends and distributions | (0.41) | (0.39) | (0.41) | (0.46) | (2.20) | |||||
Net asset value, end of Year | $9.69 | $9.12 | $9.62 | $9.36 | $9.39 | |||||
Total Return(b): | 11.01% | (1.22)% | 7.34% | 4.76% | (2.59)% | |||||
Ratios/Supplemental Data: | ||||||||||
Net assets, end of Year (000) | $156,683 | $153,762 | $171,047 | $165,090 | $141,432 | |||||
Average net assets (000) | $153,066 | $169,651 | $167,079 | $143,159 | $109,965 | |||||
Ratios to average net assets(c)(d): | ||||||||||
Expenses after waivers and/or expense reimbursement | 0.85% | 0.85% | 0.85% | 0.83% | 0.78% | |||||
Expenses before waivers and/or expense reimbursement | 1.28% | 1.25% | 1.27% | 1.30% | 1.37% | |||||
Net investment income (loss) | 3.82% | 3.63% | 3.69% | 4.05% | 3.96% | |||||
Portfolio turnover rate(e) | 110% | 114% | 102% | 90% | 93% |
(a) | Calculated based on average shares outstanding during the year. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each year reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. |
(c) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying funds in which the Fund invests. |
(e) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
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Class B Shares | ||||||||||
Year Ended October 31, | ||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||
Per Share Operating Performance(a): | ||||||||||
Net Asset Value, Beginning of Year | $8.94 | $9.45 | $9.19 | $9.23 | $11.74 | |||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | 0.29 | 0.27 | 0.28 | 0.30 | 0.32 | |||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.60 | (0.46) | 0.33 | 0.05 | (0.70) | |||||
Total from investment operations | 0.89 | (0.19) | 0.61 | 0.35 | (0.38) | |||||
Less Dividends and Distributions: | ||||||||||
Dividends from net investment income | (0.33) | (0.27) | (0.31) | (0.34) | (0.37) | |||||
Tax return of capital distributions | (0.01) | (0.05) | (0.04) | (0.05) | - | |||||
Distributions from net realized gains | - | - | - | - | (1.76) | |||||
Total dividends and distributions | (0.34) | (0.32) | (0.35) | (0.39) | (2.13) | |||||
Net asset value, end of Year | $9.49 | $8.94 | $9.45 | $9.19 | $9.23 | |||||
Total Return(b): | 10.20% | (2.08)% | 6.69% | 3.97% | (3.35)% | |||||
Ratios/Supplemental Data: | ||||||||||
Net assets, end of Year (000) | $1,145 | $1,720 | $2,332 | $2,575 | $3,083 | |||||
Average net assets (000) | $1,417 | $2,080 | $2,532 | $2,762 | $3,824 | |||||
Ratios to average net assets(c)(d): | ||||||||||
Expenses after waivers and/or expense reimbursement | 1.60% | 1.60% | 1.60% | 1.58% | 1.51% | |||||
Expenses before waivers and/or expense reimbursement | 3.36% | 2.96% | 1.97% | 2.00% | 2.09% | |||||
Net investment income (loss) | 3.12% | 2.88% | 2.95% | 3.34% | 3.24% | |||||
Portfolio turnover rate(e) | 110% | 114% | 102% | 90% | 93% |
(a) | Calculated based on average shares outstanding during the year. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each year reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. |
(c) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying funds in which the Fund invests. |
(e) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
Visit our website at www.pgiminvestments.com | 65 |
Class C Shares | ||||||||||
Year Ended October 31, | ||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||
Per Share Operating Performance(a): | ||||||||||
Net Asset Value, Beginning of Year | $8.94 | $9.44 | $9.18 | $9.23 | $11.74 | |||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | 0.28 | 0.27 | 0.27 | 0.30 | 0.31 | |||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.61 | (0.45) | 0.34 | 0.04 | (0.69) | |||||
Total from investment operations | 0.89 | (0.18) | 0.61 | 0.34 | (0.38) | |||||
Less Dividends and Distributions: | ||||||||||
Dividends from net investment income | (0.33) | (0.27) | (0.31) | (0.34) | (0.37) | |||||
Tax return of capital distributions | (0.01) | (0.05) | (0.04) | (0.05) | - | |||||
Distributions from net realized gains | - | - | - | - | (1.76) | |||||
Total dividends and distributions | (0.34) | (0.32) | (0.35) | (0.39) | (2.13) | |||||
Net asset value, end of Year | $9.49 | $8.94 | $9.44 | $9.18 | $9.23 | |||||
Total Return(b): | 10.32% | (1.98)% | 6.69% | 3.86% | (3.35)% | |||||
Ratios/Supplemental Data: | ||||||||||
Net assets, end of Year (000) | $100,653 | $109,767 | $129,397 | $108,543 | $75,622 | |||||
Average net assets (000) | $103,441 | $123,584 | $122,174 | $88,099 | $44,389 | |||||
Ratios to average net assets(c)(d): | ||||||||||
Expenses after waivers and/or expense reimbursement | 1.60% | 1.60% | 1.60% | 1.58% | 1.55% | |||||
Expenses before waivers and/or expense reimbursement | 1.96% | 1.94% | 1.98% | 2.00% | 2.05% | |||||
Net investment income (loss) | 3.09% | 2.88% | 2.93% | 3.27% | 3.19% | |||||
Portfolio turnover rate(e) | 110% | 114% | 102% | 90% | 93% |
(a) | Calculated based on average shares outstanding during the year. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each year reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. |
(c) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying funds in which the Fund invests. |
(e) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
66 | PGIM Income Builder Fund |
Class R Shares | ||||||||||
Year Ended October 31, | ||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||
Per Share Operating Performance(a): | ||||||||||
Net Asset Value, Beginning of Year | $9.10 | $9.61 | $9.34 | $9.38 | $11.89 | |||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | 0.34 | 0.31 | 0.33 | 0.35 | 0.36 | |||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.63 | (0.45) | 0.33 | 0.05 | (0.69) | |||||
Total from investment operations | 0.97 | (0.14) | 0.66 | 0.40 | (0.33) | |||||
Less Dividends and Distributions: | ||||||||||
Dividends from net investment income | (0.38) | (0.31) | (0.34) | (0.38) | (0.42) | |||||
Tax return of capital distributions | (0.01) | (0.06) | (0.05) | (0.06) | - | |||||
Distributions from net realized gains | - | - | - | - | (1.76) | |||||
Total dividends and distributions | (0.39) | (0.37) | (0.39) | (0.44) | (2.18) | |||||
Net asset value, end of Year | $9.68 | $9.10 | $9.61 | $9.34 | $9.38 | |||||
Total Return(b): | 10.88% | (1.58)% | 7.20% | 4.40% | (2.83)% | |||||
Ratios/Supplemental Data: | ||||||||||
Net assets, end of Year (000) | $1,762 | $1,768 | $610 | $561 | $359 | |||||
Average net assets (000) | $1,787 | $1,196 | $579 | $404 | $427 | |||||
Ratios to average net assets(c)(d): | ||||||||||
Expenses after waivers and/or expense reimbursement | 1.10% | 1.10% | 1.10% | 1.08% | 1.03% | |||||
Expenses before waivers and/or expense reimbursement | 2.48% | 3.02% | 1.73% | 1.75% | 1.82% | |||||
Net investment income (loss) | 3.57% | 3.25% | 3.41% | 3.76% | 3.69% | |||||
Portfolio turnover rate(e) | 110% | 114% | 102% | 90% | 93% |
(a) | Calculated based on average shares outstanding during the year. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each year reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. |
(c) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying funds in which the Fund invests. |
(e) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
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Class Z Shares | ||||||||||
Year Ended October 31, | ||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||
Per Share Operating Performance(a): | ||||||||||
Net Asset Value, Beginning of Year | $9.18 | $9.69 | $9.42 | $9.45 | $11.96 | |||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | 0.39 | 0.37 | 0.38 | 0.40 | 0.41 | |||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.63 | (0.46) | 0.33 | 0.05 | (0.69) | |||||
Total from investment operations | 1.02 | (0.09) | 0.71 | 0.45 | (0.28) | |||||
Less Dividends and Distributions: | ||||||||||
Dividends from net investment income | (0.42) | (0.36) | (0.39) | (0.42) | (0.47) | |||||
Tax return of capital distributions | (0.02) | (0.06) | (0.05) | (0.06) | - | |||||
Distributions from net realized gains | - | - | - | - | (1.76) | |||||
Total dividends and distributions | (0.44) | (0.42) | (0.44) | (0.48) | (2.23) | |||||
Net asset value, end of Year | $9.76 | $9.18 | $9.69 | $9.42 | $9.45 | |||||
Total Return(b): | 11.44% | (1.08)% | 7.67% | 4.98% | (2.33)% | |||||
Ratios/Supplemental Data: | ||||||||||
Net assets, end of Year (000) | $147,834 | $133,029 | $142,478 | $84,046 | $74,114 | |||||
Average net assets (000) | $135,434 | $141,463 | $119,795 | $64,595 | $45,082 | |||||
Ratios to average net assets(c)(d): | ||||||||||
Expenses after waivers and/or expense reimbursement | 0.60% | 0.60% | 0.60% | 0.58% | 0.56% | |||||
Expenses before waivers and/or expense reimbursement | 0.97% | 0.96% | 0.98% | 1.00% | 1.03% | |||||
Net investment income (loss) | 4.06% | 3.87% | 3.90% | 4.35% | 4.15% | |||||
Portfolio turnover rate(e) | 110% | 114% | 102% | 90% | 93% |
(a) | Calculated based on average shares outstanding during the year. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each year reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. |
(c) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying funds in which the Fund invests. |
(e) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
68 | PGIM Income Builder Fund |
Class R6 Shares | |||||||
Year Ended October 31, | December 30, 2016(a) through October 31, 2017 | ||||||
2019 | 2018 | ||||||
Per Share Operating Performance(b): | |||||||
Net Asset Value, Beginning of Period | $9.18 | $9.69 | $9.44 | ||||
Income (loss) from investment operations: | |||||||
Net investment income (loss) | 0.38 | 0.37 | 0.30 | ||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.64 | (0.46) | 0.31 | ||||
Total from investment operations | 1.02 | (0.09) | 0.61 | ||||
Less Dividends and Distributions: | |||||||
Dividends from net investment income | (0.42) | (0.36) | (0.31) | ||||
Tax return of capital distributions | (0.02) | (0.06) | (0.05) | ||||
Total dividends and distributions | (0.44) | (0.42) | (0.36) | ||||
Net asset value, end of Period | $9.76 | $9.18 | $9.69 | ||||
Total Return(c): | 11.33% | (1.07)% | 6.58% | ||||
Ratios/Supplemental Data: | |||||||
Net assets, end of Period (000) | $4,840 | $3,343 | $2,622 | ||||
Average net assets (000) | $4,163 | $3,088 | $1,384 | ||||
Ratios to average net assets(d)(e): | |||||||
Expenses after waivers and/or expense reimbursement | 0.60% | 0.60% | 0.60%(f) | ||||
Expenses before waivers and/or expense reimbursement | 1.05% | 1.32% | 0.90%(f) | ||||
Net investment income (loss) | 4.04% | 3.85% | 3.74%(f) | ||||
Portfolio turnover rate(g) | 110% | 114% | 102% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Does not include expenses of the underlying funds in which the Fund invests. |
(f) | Annualized. |
(g) | The Fund's portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Fund's portfolio turnover rate may be higher. |
Visit our website at www.pgiminvestments.com | 69 |
70 | PGIM Income Builder Fund |
■ | Employer-sponsored retirement, deferred compensation and employee benefit plans (including health savings accounts) and trusts used to fund those plans, provided that the shares are not held in a commission-based brokerage account and shares are held for the benefit of the plan |
■ | Shares purchased by or through a 529 Plan, if applicable |
■ | Shares purchased through a Merrill Lynch affiliated investment advisory program |
■ | Shares purchased by third party investment advisors on behalf of their advisory clients through Merrill Lynch’s platform |
■ | Shares of funds purchased through the Merrill Edge Self-Directed platform |
■ | Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family) |
■ | Shares exchanged from Class C (i.e. level-load) shares of the same fund in the month of or following the 10-year anniversary of the purchase date |
■ | Employees and registered representatives of Merrill Lynch or its affiliates and their family members |
■ | Directors or Trustees of the Fund, and employees of the Fund’s investment adviser or any of its affiliates, as described in this Prospectus |
■ | Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement) |
■ | Death or disability of the shareholder |
■ | Shares sold as part of a systematic withdrawal plan as described in this Prospectus |
■ | Return of excess contributions from an IRA Account |
■ | Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching age 70 1⁄2 |
■ | Shares sold to pay Merrill Lynch fees but only if the transaction is initiated by Merrill Lynch |
■ | Shares acquired through a Right of Reinstatement |
■ | Shares held in retirement brokerage accounts, that are exchanged for a lower cost share class due to transfer to certain fee based accounts or platforms (applicable to Class A and C shares only) |
■ | Breakpoints as described in this Prospectus |
■ | Rights of Accumulation (ROA) which entitle shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser’s household at Merrill Lynch. Eligible fund family assets not held at Merrill Lynch may be included in the ROA calculation only if the shareholder notifies his or her financial advisor about such assets |
■ | Letters of Intent (LOI) which allow for breakpoint discounts based on anticipated purchases within a fund family, through Merrill Lynch, over a 13-month period of time (if applicable) |
■ | Employer-sponsored retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans). For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh plans |
■ | Morgan Stanley employee and employee-related accounts according to Morgan Stanley’s account linking rules |
■ | Shares purchased through reinvestment of dividends and capital gains distributions when purchasing shares of the same fund |
■ | Shares purchased through a Morgan Stanley self-directed brokerage account |
■ | Class C (i.e., level-load) shares that are no longer subject to a contingent deferred sales charge and are converted to Class A shares of the same fund pursuant to Morgan Stanley Wealth Management’s share class conversion program |
■ | Shares purchased from the proceeds of redemptions within the same fund family, provided (i) the repurchase occurs within 90 days following the redemption, (ii) the redemption and purchase occur in the same account, and (iii) redeemed shares were subject to a front-end or deferred sales charge. |
■ | Employer-sponsored retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans). For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs or SAR-SEPs. |
■ | Shares purchased through an Ameriprise Financial investment advisory program (if an Advisory or similar share class for such investment advisory program is not available). |
■ | Shares purchased by third party investment advisors on behalf of their advisory clients through Ameriprise Financial’s platform (if an Advisory or similar share class for such investment advisory program is not available). |
■ | Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family). |
■ | Shares exchanged from Class C shares of the same fund in the month of or following the 10-year anniversary of the purchase date. To the extent that this Prospectus elsewhere provides for a waiver with respect to such shares following a shorter holding period, that waiver will apply to exchanges following such shorter period. To the extent that this Prospectus elsewhere provides for a waiver with respect to exchanges of Class C shares for load waived shares, that waiver will also apply to such exchanges. |
■ | Employees and registered representatives of Ameriprise Financial or its affiliates and their immediate family members. |
■ | Shares purchased by or through qualified accounts (including IRAs, Coverdell Education Savings Accounts, 401(k)s, 403(b) TSCAs subject to ERISA and defined benefit plans) that are held by a covered family member, defined as an Ameriprise financial advisor and/or the advisor’s spouse, advisor’s lineal ascendant (mother, father, |
grandmother, grandfather, great grandmother, great grandfather), advisor’s lineal descendant (son, step-son, daughter, step-daughter, grandson, granddaughter, great grandson, great granddaughter) or any spouse of a covered family member who is a lineal descendant. | |
■ | Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (i.e. Rights of Reinstatement). |
■ | Shares purchased in an investment advisory program. |
■ | Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family). |
■ | Employees and registered representatives of Raymond James or its affiliates and their family members as designated by Raymond James. |
■ | Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement). |
■ | A shareholder in the Fund’s Class C shares will have their shares converted at net asset value to Class A shares (or the appropriate share class) of the Fund if the shares are no longer subject to a CDSC and the conversion is in line with the policies and procedures of Raymond James. |
■ | Death or disability of the shareholder. |
■ | Shares sold as part of a systematic withdrawal plan as described in the Fund’s Prospectus. |
■ | Return of excess contributions from an IRA Account. |
■ | Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching age 70 1⁄2 as described in the Fund’s Prospectus. |
■ | Shares sold to pay Raymond James fees but only if the transaction is initiated by Raymond James. |
■ | Shares acquired through a right of reinstatement. |
■ | Breakpoints as described in this Prospectus. |
■ | Rights of accumulation which entitle shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser’s household at Raymond James. Eligible fund family assets not held at Raymond James may be included in the calculation of rights of accumulation calculation only if the shareholder notifies his or her financial advisor about such assets. |
■ | Letters of intent which allow for breakpoint discounts based on anticipated purchases within a fund family, over a 13-month time period. Eligible fund family assets not held at Raymond James may be included in the calculation of letters of intent only if the shareholder notifies his or her financial advisor about such assets. |
FOR MORE INFORMATION Please read this Prospectus before you invest in the Fund and keep it for future reference. For information or shareholder questions contact: | |
■ MAIL Prudential Mutual Fund Services LLC PO Box 9658 Providence, RI 02940■ WEBSITE www.pgiminvestments.com | ■ TELEPHONE (800) 225-1852 (973) 367-3529 (from outside the US) |
■ E-DELIVERY To receive your mutual fund documents on-line, go to www.pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
The Annual and Semi-Annual Reports and the SAI contain additional information about the Fund. Shareholders may obtain free copies of the SAI, Annual Report and Semi-Annual Report as well as other information about the Fund and may make other shareholder inquiries through the telephone number, address and website listed above. | |
■ STATEMENT OF ADDITIONAL INFORMATION (SAI) (incorporated by reference into this Prospectus) ■ SEMI-ANNUAL REPORT | ■ ANNUAL REPORT (contains a discussion of the market conditions and investment strategies that significantly affected the Fund's performance during the last fiscal year) |
You can also obtain copies of Fund documents, including the SAI, from the Securities and Exchange Commission as follows (the SEC charges a fee to copy documents): | |
■ ELECTRONIC REQUEST publicinfo@sec.gov | ■ VIA THE INTERNET on the EDGAR Database at www.sec.gov |
PGIM Income Builder Fund | ||||||
Share Class | A | B | C | R | Z | R6 |
NASDAQ | PCGAX | PBCFX | PCCFX | PCLRX | PDCZX | PCGQX |
CUSIP | 74442X108 | 74442X207 | 74442X306 | 74442X405 | 74442X504 | 74442X769 |
MFSP504STAT | The Fund's Investment Company Act File No. 811-08915 |
Term | Definition |
1933 Act | Securities Act of 1933, as amended |
1934 Act | Securities Exchange Act of 1934, as amended |
1940 Act | Investment Company Act of 1940, as amended |
1940 Act Laws, Interpretations and Exemptions | Exemptive order, SEC release, no-action letter or similar relief or interpretations, collectively |
ADR | American Depositary Receipt |
ADS | American Depositary Share |
Board | Fund’s Board of Directors or Trustees |
Board Member | A trustee or director of the Fund’s Board |
CEA | Commodity Exchange Act, as amended |
CFTC | US Commodity Futures Trading Commission |
Code | Internal Revenue Code of 1986, as amended |
CMO | Collateralized Mortgage Obligation |
ETF | Exchange-Traded Fund |
EDR | European Depositary Receipt |
Exchange | NYSE Arca, Inc. |
Fannie Mae | Federal National Mortgage Association |
FDIC | Federal Deposit Insurance Corporation |
Fitch | Fitch Ratings, Inc. |
Freddie Mac | Federal Home Loan Mortgage Corporation |
GDR | Global Depositary Receipt |
Ginnie Mae | Government National Mortgage Association |
IPO | Initial Public Offering |
IRS | Internal Revenue Service |
LIBOR | London Interbank Offered Rate |
Manager or PGIM Investments | PGIM Investments LLC |
Moody’s | Moody’s Investors Service, Inc. |
NASDAQ | National Association of Securities Dealers Automated Quotations System |
NAV | Net Asset Value |
NRSRO | Nationally Recognized Statistical Rating Organization |
NYSE | New York Stock Exchange |
OTC | Over the Counter |
Prudential | Prudential Financial, Inc. |
PMFS | Prudential Mutual Fund Services LLC |
QPTP | “Qualified publicly traded partnership” as the term is used in the Internal Revenue Code of 1986, as amended |
REIT | Real Estate Investment Trust |
Term | Definition |
RIC | Regulated Investment Company, as the term is used in the Internal Revenue Code of 1986, as amended |
S&P | S&P Global Ratings |
SEC | US Securities and Exchange Commission |
World Bank | International Bank for Reconstruction and Development |
■ | Junk bonds are issued by less creditworthy issuers. These securities are vulnerable to adverse changes in the issuer's economic condition and to general economic conditions. Issuers of junk bonds may be unable to meet their interest or principal payment obligations because of an economic downturn, specific issuer developments or the unavailability of additional financing. |
■ | The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets than issuers of investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations. |
■ | Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the senior obligations are generally paid off before the junior obligations. |
■ | Junk bonds frequently have redemption features that permit an issuer to repurchase the security from the Fund before it matures. If an issuer redeems the junk bonds, the Fund may have to invest the proceeds in bonds with lower yields and may lose income. |
■ | Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a greater impact on the prices of junk bonds than on other higher rated fixed income securities. |
■ | Junk bonds may be more illiquid than higher rated fixed income securities even under normal economic conditions. There are fewer dealers in the junk bond market, and there may be significant differences in the prices quoted for junk bonds by the dealers. Because they are less liquid, judgment may play a greater role in valuing certain of the Fund’s portfolio securities than in the case of securities trading in a more liquid market. |
■ | The Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with a defaulting issuer. |
Independent Board Members | |||
Name Date of Birth Position(s) Portfolios Overseen | Principal Occupation(s) During Past Five Years | Other Directorships Held During Past Five Years | Length of Board Service |
Ellen S. Alberding 3/11/58 Board Member Portfolios Overseen: 96 | President and Board Member, The Joyce Foundation (charitable foundation) (since 2002); Vice Chair, City Colleges of Chicago (community college system) (2011-2015); Trustee, National Park Foundation (charitable foundation for national park system) (2009-2018); Trustee, Economic Club of Chicago (since 2009); Trustee, Loyola University (since 2018). | None. | Since September 2013 |
Kevin J. Bannon 7/13/52 Board Member Portfolios Overseen: 96 | Retired; Managing Director (April 2008-May 2015) and Chief Investment Officer (October 2008-November 2013) of Highmount Capital LLC (registered investment adviser); formerly Executive Vice President and Chief Investment Officer (April 1993-August 2007) of Bank of New York Company; President (May 2003-May 2007) of BNY Hamilton Family of Mutual Funds. | Director of Urstadt Biddle Properties (equity real estate investment trust) (since September 2008). | Since July 2008 |
Linda W. Bynoe 7/9/52 Board Member Portfolios Overseen: 96 | President and Chief Executive Officer (since March 1995) and formerly Chief Operating Officer (December 1989-February 1995) of Telemat Ltd. (management consulting); formerly Vice President (January 1985-June 1989) at Morgan Stanley & Co. (broker-dealer). | Director of Anixter International, Inc. (communication products distributor) (since January 2006); Director of Northern Trust Corporation (financial services) (since April 2006); Trustee of Equity Residential (residential real estate) (since December 2009). | Since March 2005 |
Barry H. Evans 11/2/60 Board Member Portfolios Overseen: 95 | Retired; formerly President (2005 – 2016), Global Chief Operating Officer (2014– 2016), Chief Investment Officer – Global Head of Fixed Income (1998-2014), and various portfolio manager roles (1986-2006), Manulife Asset Management U.S. | Formerly Director, Manulife Trust Company (2011-2018); formerly Director, Manulife Asset Management Limited (2015-2017); formerly Chairman of the Board of Directors of Manulife Asset Management U.S. (2005-2016); formerly Chairman of the Board, Declaration Investment Management and Research (2008-2016). | Since September 2017 |
Keith F. Hartstein 10/13/56 Board Member & Independent Chair Portfolios Overseen: 96 | Retired; Member (since November 2014) of the Governing Council of the Independent Directors Council (organization of independent mutual fund directors); formerly President and Chief Executive Officer (2005-2012), Senior Vice President (2004-2005), Senior Vice President of Sales and Marketing (1997-2004), and various executive management positions (1990-1997), John Hancock Funds, LLC (asset management); Chairman, Investment Company Institute’s Sales Force Marketing Committee (2003-2008). | None. | Since September 2013 |
Laurie Simon Hodrick 9/29/62 Board Member Portfolios Overseen: 95 | A. Barton Hepburn Professor Emerita of Economics in the Faculty of Business, Columbia Business School (since 2018); Visiting Professor of Law, Stanford Law School (since 2015); Visiting Fellow at the Hoover Institution, Stanford University (since 2015); Sole Member, ReidCourt LLC (since 2008) (a consulting firm); formerly A. Barton Hepburn Professor of Economics in the Faculty of Business, Columbia Business School (1996-2017); formerly Managing Director, Global Head of Alternative Investment Strategies, Deutsche Bank (2006-2008). | Independent Director, Synnex Corporation (since April 2019) (information technology); Independent Director, Kabbage, Inc. (since July 2018) (financial services); Independent Director, Corporate Capital Trust (2017-2018) (a business development company). | Since September 2017 |
Independent Board Members | |||
Name Date of Birth Position(s) Portfolios Overseen | Principal Occupation(s) During Past Five Years | Other Directorships Held During Past Five Years | Length of Board Service |
Michael S. Hyland, CFA 10/4/45 Board Member Portfolios Overseen: 96 | Retired (since February 2005); formerly Senior Managing Director (July 2001-February 2005) of Bear Stearns & Co, Inc.; Global Partner, INVESCO (1999-2001); Managing Director and President of Salomon Brothers Asset Management (1989-1999). | None. | Since July 2008 |
Brian K. Reid 9/22/61 Board Member Portfolios Overseen: 95 | Retired; formerly Chief Economist for the Investment Company Institute (ICI) (2005-2017); formerly Senior Economist and Director of Industry and Financial Analysis at the ICI (1998-2004); formerly Senior Economist, Industry and Financial Analysis at the ICI (1996-1998); formerly Staff Economist at the Federal Reserve Board (1989-1996); Director, ICI Mutual Insurance Company (2012-2017). | None. | Since March 2018 |
Grace C. Torres 6/28/59 Board Member Portfolios Overseen: 95 | Retired; formerly Treasurer and Principal Financial and Accounting Officer of the PGIM Funds, Target Funds, Advanced Series Trust, Prudential Variable Contract Accounts and The Prudential Series Fund (1998-June 2014); Assistant Treasurer (March 1999-June 2014) and Senior Vice President (September 1999-June 2014) of PGIM Investments LLC; Assistant Treasurer (May 2003-June 2014) and Vice President (June 2005-June 2014) of AST Investment Services, Inc.; Senior Vice President and Assistant Treasurer (May 2003-June 2014) of Prudential Annuities Advisory Services, Inc. | Formerly Director (July 2015-January 2018) of Sun Bancorp, Inc. N.A. and Sun National Bank; Director (since January 2018) of OceanFirst Financial Corp. and OceanFirst Bank. | Since November 2014 |
Interested Board Members | |||
Name Date of Birth Position(s) Portfolios Overseen | Principal Occupation(s) During Past Five Years | Other Directorships Held During Past Five Years | Length of Board Service |
Stuart S. Parker 10/5/62 Board Member & President Portfolios Overseen: 96 | President of PGIM Investments LLC (formerly known as Prudential Investments LLC) (since January 2012); Executive Vice President of Prudential Investment Management Services LLC (since December 2012); formerly Executive Vice President of Jennison Associates LLC and Head of Retail Distribution of PGIM Investments LLC (June 2005-December 2011). | None. | Since January 2012 |
Scott E. Benjamin 5/21/73 Board Member & Vice President Portfolios Overseen:96 | Executive Vice President (since June 2009) of PGIM Investments LLC; Executive Vice President (June 2009-June 2012) and Vice President (since June 2012) of Prudential Investment Management Services LLC; Executive Vice President (since September 2009) of AST Investment Services, Inc.; Senior Vice President of Product Development and Marketing, PGIM Investments (since February 2006); formerly Vice President of Product Development and Product Management, PGIM Investments LLC (2003-2006). | None. | Since March 2010 |
Fund Officers(a) | ||
Name Date of Birth Fund Position | Principal Occupation(s) During Past Five Years | Length of Service as Fund Officer |
Raymond A. O’Hara 9/11/55 Chief Legal Officer | Vice President and Corporate Counsel (since July 2010) of Prudential Insurance Company of America (Prudential); Vice President (March 2011-Present) of Pruco Life Insurance Company and Pruco Life Insurance Company of New Jersey; Vice President and Corporate Counsel (March 2011-Present) of Prudential Annuities Life Assurance Corporation; Chief Legal Officer of PGIM Investments LLC (since June 2012); Chief Legal Officer of Prudential Mutual Fund Services LLC (since June 2012) and Corporate Counsel of AST Investment Services, Inc. (since June 2012); formerly Assistant Vice President and Corporate Counsel (September 2008-July 2010) of The Hartford Financial Services Group, Inc.; formerly Associate (September 1980-December 1987) and Partner (January 1988–August 2008) of Blazzard & Hasenauer, P.C. (formerly, Blazzard, Grodd & Hasenauer, P.C.). | Since June 2012 |
Dino Capasso 8/19/74 Chief Compliance Officer | Chief Compliance Officer (July 2019-Present) of PGIM Investments LLC; Chief Compliance Officer (July 2019-Present) of the PGIM Funds, Target Funds, Advanced Series Trust, The Prudential Series Fund, Prudential’s Gibraltar Fund, Inc., PGIM Global High Yield Fund, Inc., and PGIM High Yield Bond Fund, Inc.; Vice President and Deputy Chief Compliance Officer (June 2017-2019) of PGIM Investments LLC; formerly, Senior Vice President and Senior Counsel (January 2016-June 2017), and Vice President and Counsel (February 2012-December 2015) of Pacific Investment Management Company LLC. | Since March 2018 |
Andrew R. French 12/22/62 Secretary | Vice President of PGIM Investments LLC (December 2018-Present); formerly Vice President and Corporate Counsel (February 2010-December 2018) of Prudential; formerly Director and Corporate Counsel (2006-2010) of Prudential; Vice President and Assistant Secretary (since January 2007) of PGIM Investments LLC; Vice President and Assistant Secretary (since January 2007) of Prudential Mutual Fund Services LLC. | Since October 2006 |
Jonathan D. Shain 8/9/58 Assistant Secretary | Vice President and Corporate Counsel (since August 1998) of Prudential; Vice President and Assistant Secretary (since May 2001) of PGIM Investments LLC; Vice President and Assistant Secretary (since February 2001) of Prudential Mutual Fund Services LLC; formerly Vice President and Assistant Secretary (May 2003-June 2005) of AST Investment Services, Inc. | Since May 2005 |
Claudia DiGiacomo 10/14/74 Assistant Secretary | Vice President and Corporate Counsel (since January 2005) of Prudential; Vice President and Assistant Secretary of PGIM Investments LLC (since December 2005); formerly Associate at Sidley Austin Brown & Wood LLP (1999-2004). | Since December 2005 |
Diana N. Huffman 4/14/82 Assistant Secretary | Vice President and Corporate Counsel (since September 2015) of Prudential; formerly Associate at Willkie Farr & Gallagher LLP (2009-2015). | Since March 2019 |
Kelly A. Coyne 8/8/68 Assistant Secretary | Director, Investment Operations of Prudential Mutual Fund Services LLC (since 2010). | Since March 2015 |
Christian J. Kelly 5/5/75 Treasurer and Principal Financial and Accounting Officer | Vice President, Head of Fund Administration of PGIM Investments LLC (since November 2018); formerly, Director of Fund Administration of Lord Abbett & Co. LLC (2009-2018), Treasurer and Principal Accounting Officer of the Lord Abbett Family of Funds (2017-2018); Director of Accounting, Avenue Capital Group (2008-2009); Senior Manager, Investment Management Practice of Deloitte & Touche LLP (1998-2007). | Since January 2019 |
Lana Lomuti 6/7/67 Assistant Treasurer | Vice President (since 2007) and Director (2005-2007), within PGIM Investments Fund Administration; formerly Assistant Treasurer (December 2007-February 2014) of The Greater China Fund, Inc. | Since April 2014 |
Russ Shupak 10/08/73 Assistant Treasurer | Vice President (since 2017) and Director (2013-2017), within PGIM Investments Fund Administration. | Since October 2019 |
Deborah Conway 3/26/69 Assistant Treasurer | Vice President (since 2017) and Director (2007-2017), within PGIM Investments Fund Administration. | Since October 2019 |
Elyse M. McLaughlin 1/20/74 Assistant Treasurer | Vice President (since 2017) and Director (2011-2017), within PGIM Investments Fund Administration. | Since October 2019 |
Charles H. Smith 1/11/73 Anti-Money Laundering Compliance Officer | Vice President, Corporate Compliance, Anti-Money Laundering Unit (since January 2015) of Prudential; committee member of the American Council of Life Insurers Anti-Money Laundering and Critical Infrastructure Committee (since January 2016); formerly Global Head of Economic Sanctions Compliance at AIG Property Casualty (February 2007-December 2014); Assistant Attorney General at the New York State Attorney General's Office, Division of Public Advocacy. (August 1998-January 2007). | Since January 2017 |
■ | Board Members are deemed to be “Interested,” as defined in the 1940 Act, by reason of their affiliation with PGIM Investments LLC and/or an affiliate of PGIM Investments LLC. |
■ | Unless otherwise noted, the address of all Board Members and Officers is c/o PGIM Investments LLC, 655 Broad Street, Newark, New Jersey 07102-4410. |
■ | There is no set term of office for Board Members or Officers. The Board Members have adopted a retirement policy, which calls for the retirement of Board Members on December 31 of the year in which they reach the age of 75. |
■ | “Other Directorships Held” includes only directorships of companies required to register or file reports with the SEC under the 1934 Act (that is, “public companies”) or other investment companies registered under the 1940 Act. |
■ | “Portfolios Overseen” includes all investment companies managed by PGIM Investments LLC. The investment companies for which PGIM Investments LLC serves as manager include the PGIM Funds, The Prudential Variable Contract Accounts, PGIM ETF Trust, PGIM High Yield Bond Fund, Inc., PGIM Global High Yield Fund, Inc., The Prudential Series Fund, Prudential's Gibraltar Fund, Inc. and the Advanced Series Trust. |
Compensation Received by Independent Board Members | ||||
Name | Aggregate Fiscal Year Compensation from Fund | Pension or Retirement Benefits Accrued as Part of Fund Expenses | Estimated Annual Benefits Upon Retirement | Total Compensation from Fund and Fund Complex for Most Recent Calendar Year |
Ellen S. Alberding | $1,927 | None | None | $312,000 (32/96)* |
Kevin J. Bannon | $1,970 | None | None | $322,000 (32/96)* |
Linda W. Bynoe** | $1,963 | None | None | $322,000 (32/96)* |
Barry H. Evans** | $1,923 | None | None | $309,000 (31/95)* |
Keith F. Hartstein** | $2,210 | None | None | $386,000 (32/96)* |
Laurie Simon Hodrick** | $1,937 | None | None | $313,000 (31/95)* |
Michael S. Hyland** | $1,963 | None | None | $318,000 (32/96)* |
Richard A. Redeker**† | $433 | None | None | $309,000 (32/96)* |
Brian K. Reid | $1,930 | None | None | $266,500 (31/95)* |
Grace C. Torres | $1,780 | None | None | $269,000 (31/95)* |
Board Committee Meetings (for most recently completed fiscal year) | ||
Audit Committee | Nominating & Governance Committee | Dryden & Gibraltar Investment Committee |
7 | 4 | 4 |
Name | Dollar Range of Equity Securities in the Fund | Aggregate Dollar Range of Equity Securities in All Registered Investment Companies Overseen by Board Member in Fund Complex |
Board Member Share Ownership: Independent Board Members | ||
Ellen Alberding | None | Over $100,000 |
Kevin J. Bannon | None | Over $100,000 |
Linda W. Bynoe | None | Over $100,000 |
Barry H. Evans | None | Over $100,000 |
Keith Hartstein | None | Over $100,000 |
Laurie Simon Hodrick | None | Over $100,000 |
Michael S. Hyland | None | Over $100,000 |
Brian K. Reid | None | Over $100,000 |
Grace C. Torres | None | Over $100,000 |
Board Member Share Ownership: Interested Board Members | ||
Stuart S. Parker | None | Over $100,000 |
Scott E. Benjamin | None | Over $100,000 |
■ | the salaries and expenses of all of its and the Fund's personnel except the fees and expenses of Independent Board Members; |
■ | all expenses incurred by the Manager or the Fund in connection with managing the ordinary course of the Fund's business, other than those assumed by the Fund as described below; and |
■ | the fees, costs and expenses payable to any subadviser pursuant to a subadvisory agreement between PGIM Investments and such subadviser. |
■ | the fees and expenses incurred by the Fund in connection with the management of the investment and reinvestment of the Fund's assets payable to the Manager; |
■ | the fees and expenses of Independent Board Members; |
■ | the fees and certain expenses of the Custodian and transfer and dividend disbursing agent, including the cost of providing records to the Manager in connection with its obligation of maintaining required records of the Fund and of pricing the Fund's shares; |
■ | the charges and expenses of the Fund's legal counsel and independent auditors and counsel to the Independent Board Members; |
■ | brokerage commissions and any issue or transfer taxes chargeable to the Fund in connection with its securities (and futures, if applicable) transactions; |
■ | all taxes and corporate fees payable by the Fund to governmental agencies; |
■ | the fees of any trade associations of which the Fund may be a member; |
■ | the cost of share certificates representing, and/or non-negotiable share deposit receipts evidencing, shares of the Fund; |
■ | the cost of fidelity, directors and officers and errors and omissions insurance; |
■ | the fees and expenses involved in registering and maintaining registration of the Fund and of its shares with the SEC and paying notice filing fees under state securities laws, including the preparation and printing of the Fund's registration statements and prospectuses for such purposes; allocable communications expenses with respect to investor services and all expenses of shareholders' and Board meetings and of preparing, printing and mailing reports and notices to shareholders; and |
■ | litigation and indemnification expenses and other extraordinary expenses not incurred in the ordinary course of the Fund's business and distribution and service (12b-1) fees. |
Management Fees Paid by PGIM Income Builder Fund | |||
2019 | 2018 | 2017 | |
Gross Fee | $2,795,153 | $3,087,433 | $2,893,132 |
Amount Waived/Reimbursed by PGIM Investments | $(1,519,627) | $(1,606,130) | $(1,560,570) |
Net Fee | $1,275,526 | $1,481,303 | $1,332,562 |
Subadvisory Fee Rates & Subadvisory Fees Paid | ||||
Subadviser | Fee Rate | 2019 | 2018 | 2017 |
QMA LLC (QMA)* | 0.175% | $698,789 | $771,858 | $723,283 |
Jennison Associates LLC (Jennison) (Non-MLP investments) | 0.425% to $500 million; 0.40% over $500 million to $1 billion; 0.375% over $1 billion | $355,966 | $434,749 | $356,952 |
Jennison (MLPs) | Fee for direct investments in MLPs: 0.60% of average daily net assets to $300 million; and 0.50% of daily net assets over $300 million** | $271,577 | $266,560 | $339,360 |
PGIM Fixed Income/PGIM Limited (Broad Market High Yield strategy) | 0.25% | $176,646*** | $205,888 | $225,046 |
PGIM Fixed Income/PGIM Limited (Emerging Markets Debt strategy) | 0.45% to $200 million; 0.40% over $200 million | $300,237*** | $258,602 | $271,500 |
PGIM Real Estate | 0.40% | $191,267 | $193,369 | $155,569 |
Other Funds and Investment Accounts Managed by the Portfolio Managers | ||||
Subadviser | Portfolio Managers | Registered Investment Companies/Total Assets | Other Pooled Investment Vehicles/ Total Assets | Other Accounts/ Total Assets |
QMA LLC | Edward L. Campbell, CFA | 47/$59,626,729,376 | 3/$1,103,150,460 | 22/$1,137,359,257 |
Rory Cummings, CFA | 47/$59,626,729,376 | 3/$1,103,150,460 | 22/$1,137,359,257 | |
Peter Vaiciunas, CFA | 47/$59,626,729,376 | 3/$1,103,150,460 | 22/$1,137,359,257 | |
Jennison Associates LLC | Ubong “Bobby” Edemeka | 7/$5,579,493,000 | 1/$39,827,000 | None |
Shaun Hong, CFA | 7/$5,579,493,000 | 1/$39,827,000 | None | |
Stephen J. Maresca, CFA | 1/$462,273,000 | None | None | |
PGIM Fixed Income* PGIM Limited | David Bessey | 23/$6,741,210,894 | 26/$3,191,206,652 1/$291,790,067 | 204/$48,781,035,126 1/$10,223,339 |
Cathy L. Hepworth, CFA | 23/$6,741,210,894 | 26/$3,191,206,652 1/$291,790,067 | 204/$48,781,035,126 1/$10,223,339 | |
Mariusz Banasiak, CFA | 23/$6,741,210,894 | 26/$3,191,206,652 1/$291,790,067 | 204/$48,781,035,126 1/$10,223,339 | |
Robert Cignarella, CFA | 31/$18,590,544,911 | 20/$6,391,245,912 | 122/$13,257,896,437 | |
Brian Clapp, CFA | 31/$18,023,099,672 | 20/$6,391,245,912 | 122/$13,257,896,437 | |
Robert Spano, CFA, CPA | 31/$18,023,099,672 | 20/$6,391,245,912 | 122/$13,257,896,437 | |
Daniel Thorogood, CFA | 31/$18,023,099,672 | 20/$6,391,245,912 | 122/$13,257,896,437 | |
Ryan Kelly, CFA | 31/$18,023,099,672 | 20/$6,391,245,912 | 122/$13,257,896,437 | |
PGIM Real Estate | Rick J. Romano, CFA** | 9/1,956,355,888 | None | 4/651,751,038 |
Kwok Wing Cheong, CFA** | 9/1,956,355,888 | None | 4/651,751,038 | |
Daniel Cooney** | 9/1,956,355,888 | None | 4/651,751,038 | |
PGIM Limited | Michael Gallagher** | 9/1,956,355,888 | None | 4/651,751,038 |
Personal Investments and Financial Interests of the Portfolio Managers | ||
Subadviser | Portfolio Managers | Investments and Other Financial Interests in the Fund and Similar Strategies* |
QMA LLC | Edward L. Campbell, CFA | $10,001 - $50,000 |
Rory Cummings, CFA | $1 - $10,000 | |
Peter Vaiciunas, CFA | $1 - $10,000 | |
Jennison Associates LLC | Ubong “Bobby” Edemeka | $500,001 - $1,000,000 |
Shaun Hong, CFA | Over $1,000,000 | |
Stephen J. Maresca, CFA | $100,001 - $500,000 | |
PGIM Fixed Income PGIM Limited | David Bessey | None |
Cathy L. Hepworth, CFA | None | |
Mariusz Banasiak, CFA | None | |
Robert Cignarella, CFA | $10,001 - $50,000 | |
Brian Clapp, CFA | None | |
Robert Spano, CFA, CPA | None |
Personal Investments and Financial Interests of the Portfolio Managers | ||
Subadviser | Portfolio Managers | Investments and Other Financial Interests in the Fund and Similar Strategies* |
Daniel Thorogood, CFA | None | |
Ryan Kelly, CFA | None | |
PGIM Real Estate | Rick J. Romano, CFA | $500,001 - $1,000,000 |
Kwok Wing Cheong, CFA | $100,001 - $500,000 | |
Daniel Cooney | $100,001 - $500,000 | |
PGIM Limited | Michael Gallagher | $50,001 - $100,000 |
■ | Elimination of the conflict; |
■ | Disclosure of the conflict; or |
■ | Management of the conflict through the adoption of appropriate policies and procedures. |
■ | Asset-Based Fees vs. Performance-Based Fees; Other Fee Considerations. QMA manages accounts with asset-based fees alongside accounts with performance-based fees. Asset-based fees are calculated based on the value of a client’s portfolio at periodic measurement dates or over specified periods of time. Performance-based fees are generally based on a share of the total return of a portfolio, and may offer greater upside potential to QMA than asset-based fees, depending on how the fees are structured. This side-by-side management could create an incentive for QMA to favor one account over another. Specifically, QMA could have the incentive to favor accounts for which it receives performance fees, and possibly take greater investment risks in those accounts, in order to bolster performance and increase its fees. In addition, since fees are negotiable, one client may be paying a higher fee than another client with similar investment objectives or goals. In negotiating fees, QMA takes into account a number of factors including, but not limited to, the investment strategy, the size of a portfolio being managed, the relationship with the client, and the required level of service. Fees may also differ based on account type. For example, fees for commingled vehicles, including those that QMA subadvises, may differ from fees charged for single client accounts. |
■ | Long Only/Long-Short Accounts. QMA manages accounts that only allow it to hold securities long as well as accounts that permit short selling. QMA may, therefore, sell a security short in some client accounts while holding the same security long in other client accounts, creating the possibility that QMA is taking inconsistent positions with respect to a particular security in different client accounts. |
■ | Compensation/Benefit Plan Accounts/Other Investments by Investment Professionals. QMA manages certain funds and strategies whose performance is considered in determining long-term incentive plan benefits for certain investment professionals. Investment professionals involved in the management of accounts in these strategies have an incentive to favor them over other accounts they manage in order to increase their compensation. Additionally, QMA’s investment professionals may have an interest in funds in those strategies if the funds are chosen as options in their 401(k) or deferred compensation plans offered by Prudential or if they otherwise invest in those funds directly. |
■ | Affiliated Accounts. QMA manages accounts on behalf of its affiliates as well as unaffiliated accounts. QMA could have an incentive to favor accounts of affiliates over others. |
■ | Non-Discretionary Accounts or Model Portfolios. QMA provides non-discretionary model portfolios to some clients and manages other portfolios on a discretionary basis. When QMA manages accounts on a non-discretionary basis, the investment team will typically deliver a model portfolio to a non-discretionary client at or around the same time as executing discretionary trades in the same strategy. The non-discretionary clients may be disadvantaged if QMA delivers the model investment portfolio to them after it initiates trading for the discretionary clients, or vice versa. |
■ | Large Accounts/Higher Fee Strategies. Large accounts typically generate more revenue than do smaller accounts and certain strategies have higher fees than others. As a result, a portfolio manager has an incentive when allocating investment opportunities to favor accounts that pay a higher fee or generate more income for QMA. |
■ | Securities of the Same Kind or Class. QMA sometimes buys or sells, or directs or recommends that a client buy or sell, securities of the same kind or class that are purchased or sold for another client, at prices that may be different. Although such pricing differences could appear as preferences for one client over another, QMA’s trade execution in each case is driven by its consideration of a variety of factors as we seek the most advantageous terms reasonably attainable in the circumstances. QMA may also, at any time, execute trades of securities of the same kind or class in one direction for an account and in the opposite direction for another account, or not trade in any other account. Opposite way trades are generally due to differences in investment strategy, portfolio composition or client direction. |
■ | Conflicts Arising Out of Legal Restrictions. QMA may be restricted by law, regulation, contract or other constraints as to how much, if any, of a particular security it may purchase or sell on behalf of a client, and as to the timing of such purchase or sale. Sometimes, these restrictions apply as a result of QMA’s relationship with Prudential Financial and its other affiliates. For example, QMA’s holdings of a security on behalf of its clients are required, under certain regulations, to be aggregated with the holdings of that security by other Prudential Financial affiliates. These holdings could, on an aggregate basis, exceed certain reporting or ownership thresholds. Prudential tracks these aggregate holdings and QMA may restrict purchases, sell existing investments, or otherwise restrict, forego or limit the exercise of rights to clients to avoid crossing such thresholds because of the potential consequences to QMA, Prudential, or QMA’s clients if such thresholds are exceeded. In addition, QMA could receive material, non-public information with respect to a particular issuer from an affiliate and, as a result, be unable to execute purchase or sale transactions in securities of that issuer for its clients. QMA is generally able to avoid receiving material, non-public information from its affiliates by maintaining information barriers to prevent the transfer of information between affiliates. QMA's trading of Prudential Financial common stock for its clients' portfolios also presents a conflict of interest and, consequently, QMA does so only when permitted by its clients. |
■ | The Fund may be prohibited from engaging in transactions with its affiliates even when such transactions may be beneficial for the Fund. Certain affiliated transactions are permitted in accordance with procedures adopted by the Fund and reviewed by the independent board members of the Fund. |
■ | QMA performs asset allocation services as subadviser for affiliated mutual funds managed or co-managed by the Manager, including for some portfolios offered by the Funds. Where, in these arrangements, QMA also manages underlying funds or accounts within asset classes included in the mutual fund guidelines (as is the case with the Funds), QMA will allocate assets to such underlying funds or accounts. In these circumstances, QMA receives both an asset allocation fee and a management fee. As a result, QMA has an |
■ | QMA’s affiliates can have an incentive to seek to influence QMA’s asset allocation decisions, for example to facilitate hedging or improve profit margins. Through training and the establishment of communication barriers, however, QMA seeks to avoid any influence by its affiliates and implements its asset allocation decisions solely in what QMA believes to be the best interests of the funds and in compliance with applicable guidelines. QMA also belives that it makes such allocations in a manner consistent with its fiduciary obligations. |
■ | In certain arrangements, QMA subadvises mutual funds for the Manager through a program where they have selected QMA as a manager, resulting in QMA’s collection of subadvisory fees from them. The Manager also selects managers for some of QMA’s asset allocation products and, in certain cases, is compensated by QMA for these services under service agreements. The Manager and QMA may have a mutual incentive to continue these types of arrangements that benefit both companies. These and other types of conflicts of interest are reviewed to verify that appropriate oversight is performed. |
■ | QMA, Prudential Financial, Inc., The Prudential Insurance Company of America (PICA) and other affiliates of QMA have financial interests in, or relationships with, companies whose securities QMA holds, purchases or sells in its client accounts. Certain of these interests and relationships are material to QMA or to the Prudential enterprise. At any time, these interests and relationships could be inconsistent or in potential or actual conflict with positions held or actions taken by QMA on behalf of its client accounts. For example, QMA invests in the securities of one or more clients for the accounts of other clients. QMA’s affiliates sell various products and/or services to certain companies whose securities QMA purchases and sells for its clients. QMA’s affiliates hold public and private debt and equity securities of a large number of issuers. QMA invests in some of the same issuers for its client accounts but at different levels in the capital structure. For instance, QMA may invest client assets in the equity of companies whose debt is held by an affiliate. Certain of QMA’s affiliates (as well as directors of QMA’s affiliates) are officers or directors of issuers in which QMA invests from time to time. These issuers may also be service providers to QMA or its affiliates. In general, conflicts related to the financial interests described above are addressed by the fact that QMA makes investment decisions for each client independently considering the best economic interests of such client. |
■ | Certain of QMA’s employees may offer and sell securities of, and interests in, commingled funds that QMA manages or subadvises. Employees may offer and sell securities in connection with their roles as registered representatives of Prudential Investment Management Services LLC (a broker-dealer affiliate), or as officers, agents, or approved persons of other affiliates. There is an incentive for QMA’s employees to offer these securities to investors regardless of whether the investment is appropriate for such investor since increased assets in these vehicles will result in increased advisory fees to QMA. In addition, although sales commissions are not paid for such activities, such sales could result in increased compensation to the employee. To mitigate this conflict, QMA performs suitability checks on new clients as well as on an annual basis with respect to all clients. |
■ | A portion of the long-term incentive grant of some of QMA’s investment professionals will increase or decrease based on the performance of several of QMA’s strategies over defined time periods. Consequently, some of QMA’s portfolio managers from time to time have financial interests in the accounts they advise. To address potential conflicts related to these financial interests, QMA has procedures, including supervisory review procedures, designed to verify that each of its accounts is managed in a manner that is consistent with QMA’s fiduciary obligations, as well as with the account’s investment objectives, investment strategies and restrictions. Specifically, QMA’s chief investment officer will perform a comparison of trading costs between accounts in the strategies whose performance is considered in connection with the long-term incentive grant and other accounts, to verify that such costs are consistent with each other or otherwise in line with expectations. The results of the analysis are discussed at a meeting of QMA's Trade Management Oversight Committee. |
■ | QMA retains third party advisors and other service providers to provide various services for QMA as well as for funds that QMA manages or subadvises. A service provider may provide services to QMA or one of its funds while also providing services to PGIM, Inc. (PGIM) other PGIM-advised funds, or affiliates of PGIM, and may negotiate rates in the context of the overall relationship. QMA may benefit from negotiated fee rates offered to its funds and vice-versa. There is no assurance, however, that QMA will be able to obtain advantageous fee rates from a given provider negotiated by its affiliates based on their relationship with the service provider, or that it will know of such negotiated fee rates. |
■ | Occasionally, a conflict of interest may arise in connection with proxy voting. For example, the issuer of the securities being voted may also be a client or affiliate of QMA. When QMA identifies an actual or potential conflict of interest between QMA and its clients or affiliates, QMA votes in accordance with the policy of its proxy vendor rather than its own policy. In that manner, QMA seeks to maintain the independence and objectivity of the vote. |
■ | One-, three-, five-year and longer term pre-tax investment performance for groupings of accounts managed in the same strategy (composite) relative to market conditions, pre-determined passive indices and industry peer group data for the product strategy (e.g., large cap growth, large cap value). Some portfolio managers may manage or contribute ideas to more than one product strategy, and the performance of the other product strategies is also considered in determining the portfolio manager’s overall compensation. |
■ | The investment professional’s contribution to client portfolio’s pre-tax one-, three-, five-year and longer-term performance from the investment professional’s recommended stocks relative to market conditions, the strategy’s passive benchmarks, and the investment professional’s respective coverage universes. |
■ | The quality of the portfolio manager’s investment ideas and consistency of the portfolio manager’s judgment; |
■ | Qualitative factors such as teamwork and responsiveness; |
■ | Individual factors such as years of experience and responsibilities specific to the individual’s role such as being a team leader or supervisor are also factored into the determination of an investment professional’s total compensation; and |
■ | Historical and long-term business potential of the product strategies. |
1. | business initiatives; |
2. | the number of investment professionals receiving a bonus and related peer group compensation; |
3. | financial metrics of the business relative to those of appropriate peer groups; and |
4. | investment performance of portfolios: (i) relative to appropriate peer groups; and/or (ii) as measured against relevant investment indices. |
■ | elimination of the conflict; |
■ | disclosure of the conflict; or |
■ | management of the conflict through the adoption of appropriate policies, procedures or other mitigants. |
■ | Performance Fees - PGIM Fixed Income manages accounts with asset-based fees alongside accounts with performance-based fees. This side-by-side management may be deemed to create an incentive for PGIM Fixed Income and its investment professionals to favor one account over another. Specifically, PGIM Fixed Income or its affiliates could be considered to have the incentive to favor accounts for which PGIM Fixed Income or an affiliate receives performance fees, and possibly take greater investment risks in those accounts, in order to bolster performance and increase its fees. |
■ | Affiliated accounts - PGIM Fixed Income manages accounts on behalf of its affiliates as well as unaffiliated accounts. PGIM Fixed Income could be considered to have an incentive to favor accounts of affiliates over others. |
■ | Large accounts/higher fee strategies - large accounts and clients typically generate more revenue than do smaller accounts or clients and certain of PGIM Fixed Income’s strategies have higher fees than others. As a result, a portfolio manager could be considered to have an incentive when allocating scarce investment opportunities to favor accounts that pay a higher fee or generate more income for PGIM Fixed Income. |
■ | Long only and long/short accounts - PGIM Fixed Income manages accounts that only allow it to hold securities long as well as accounts that permit short selling. PGIM Fixed Income may, therefore, sell a security short in some client accounts while holding the same security long in other client accounts. These short sales could reduce the value of the securities held in the long only accounts. In addition, purchases for long only accounts could have a negative impact on the short positions. |
■ | Securities of the same kind or class - PGIM Fixed Income sometimes buys or sells, or direct or recommend that a client buy or sell, securities of the same kind or class that are purchased or sold for another client at prices that may be different. Although such pricing differences could appear as preferences for one client over another, PGIM Fixed Income’s trade execution in each case is driven by its consideration of a variety of factors as PGIM Fixed Income seeks the most advantageous terms reasonably attainable in the circumstances. PGIM Fixed Income may also, at any time, execute trades of securities of the same kind or class in one direction for an account and in the opposite direction for another account, or not trade such securities in any other account. While such trades (or a decision not to trade) could appear as inconsistencies in how PGIM Fixed Income views a security for one client versus another, opposite way trades are generally due to differences in investment strategy, portfolio composition or client direction. |
■ | Investment at different levels of an issuer’s capital structure - PGIM Fixed Income may invest client assets in the same issuer, but at different levels in the issuer’s capital structure. For instance, PGIM Fixed Income may invest client assets in private securities or loans of an issuer and invest the assets of other clients in publicly traded securities of the same issuer. In addition, PGIM Fixed Income may invest client assets in a class or tranche of securities of a structured finance vehicle (such as a collateralized loan obligation, asset-backed security or mortgage-backed security) where PGIM Fixed Income also, at the same or different time, invests the assets of another client (including affiliated clients) in a different class or tranche of securities of the same vehicle. These different securities may have different voting rights, dividend or repayment priorities, rights in bankruptcy or other features that conflict with one another. For some of these securities (particularly private structured product investments for which clients own all or a significant portion of the outstanding securities or obligations), PGIM Fixed Income may have input regarding the characteristics and the relative rights and priorities of the various classes or tranches. When PGIM Fixed Income invests client assets in different levels of an issuer’s capital structure, it may take actions with respect to the assets held by one client (including affiliated clients) that are potentially adverse to other clients, for example, by foreclosing on loans or by putting an issuer into default. In negotiating the terms and conditions of any such investments, or any subsequent amendments or waivers, PGIM Fixed Income may find that the interests of a client and the interests of one or more other clients (including affiliated clients) could conflict. In these situations, decisions over proxy voting, corporate reorganizations, how to exit an investment, bankruptcy matters (including, for example, whether to trigger an event of default or the terms of any workout) or other actions or inactions may result in conflicts of interest. Similarly, if an issuer in which a client and one or more other clients directly or indirectly hold different classes of securities encounters financial problems, decisions over the terms of any workout will raise conflicts of interests (including potential conflicts over proposed waivers and amendments to debt covenants). For example, a senior bond holder may prefer a liquidation of the issuer in which it may be paid in full, whereas an equity or junior bond holder might prefer a reorganization that holds the potential to create value for the equity holders or junior bond holders. In some cases, PGIM Fixed Income may refrain from taking certain actions or making investments on behalf of certain clients or PGIM Fixed Income may sell investments for certain clients, in each case in order to mitigate conflicts of interest or legal, regulatory or other risks to PGIM Fixed Income. This could potentially disadvantage the clients on whose behalf the actions are not taken, investments are not made, or investments are sold. Conversely, in other cases, PGIM Fixed Income will not refrain from taking actions or making investments on behalf of some clients (including affiliated clients), which could potentially disadvantage other clients. Any of the foregoing conflicts of interest will be resolved on a case-by-case basis. Any such resolution will take into consideration the interests of the relevant clients, the circumstances giving rise to the conflict and applicable laws. |
■ | Financial interests of investment professionals - PGIM Fixed Income investment professionals may invest in certain investment vehicles that it manages, including ETFs, mutual funds and private funds. Also, certain of these investment vehicles are options under |
the 401(k) and deferred compensation plans offered by Prudential Financial, Inc. In addition, the value of grants under PGIM Fixed Income’s long-term incentive plan and targeted long-term incentive plan is affected by the performance of certain client accounts. As a result, PGIM Fixed Income investment professionals may have financial interests in accounts managed by PGIM Fixed Income or that are related to the performance of certain client accounts. | |
■ | Non-discretionary accounts - PGIM Fixed Income provides non-discretionary investment advice to some clients and manages others on a discretionary basis. Trades in non-discretionary accounts or accounts where discretion is limited could occur before, in concert with, or after PGIM Fixed Income executes similar trades in its discretionary accounts. The non-discretionary/limited discretion clients may be disadvantaged if PGIM Fixed Income delivers investment advice to them after it initiates trading for the discretionary clients, or vice versa. |
■ | In keeping with PGIM Fixed Income’s fiduciary obligations, its policy with respect to trade aggregation and allocation is to treat all of its client accounts fairly and equitably over time. PGIM Fixed Income’s trade management oversight committee, which generally meets quarterly, is responsible for providing oversight with respect to trade aggregation and allocation. Its compliance group periodically reviews a sampling of new issue allocations and related documentation to confirm compliance with the trade aggregation and allocation procedures. In addition, the compliance and investment risk management groups review forensic reports regarding new issue and secondary trade activity on a quarterly basis. This forensic analysis includes such data as the: (i) number of new issues allocated in the strategy; (ii) size of new issue allocations to each portfolio in the strategy; (iii) profitability of new issue transactions; (iv) portfolio turnover; and (v) metrics related to large and block trade activity. The results of these analyses are reviewed and discussed at PGIM Fixed Income’s trade management oversight committee meetings. The procedures above are designed to detect patterns and anomalies in PGIM Fixed Income’s side-by-side management and trading so that it may assess and improve its processes. |
■ | PGIM Fixed Income has procedures that specifically address its side-by-side management of certain long/short and long only portfolios. These procedures address potential conflicts that could arise from differing positions between long/short and long only portfolios. In addition, lending opportunities with respect to securities for which the market is demanding a slight premium rate over normal market rates are allocated to long only accounts prior to allocating the opportunities to long/short accounts. |
■ | Conflicts Related to Outside Business Activity. From time to time, certain of PGIM Fixed Income employees or officers may engage in outside business activity, including outside directorships. Any outside business activity is subject to prior approval pursuant to PGIM Fixed Income’s personal conflicts of interest and outside business activities policy. Actual and potential conflicts of interest are analyzed during such approval process. PGIM Fixed Income could be restricted in trading the securities of certain issuers in client portfolios in the unlikely event that an employee or officer, as a result of outside business activity, obtains material, non-public information regarding an issuer. |
■ | Conflicts Related to Investment of Client Assets in Affiliated Funds. PGIM Fixed Income may invest client assets in funds that it manages or subadvises for an affiliate. PGIM Fixed Income may also invest cash collateral from securities lending transactions in these funds. These investments benefit both PGIM Fixed Income and its affiliate. |
■ | PICA General Account. Because of the substantial size of the general accounts of PGIM Fixed Income’s affiliated insurance companies, trading by these general accounts, including PGIM Fixed Income’s trades on behalf of the accounts, may affect the market prices or limit the availability of the securities or instruments transacted. Although PGIM Fixed Income does not expect that the general accounts of affiliate insurers will execute transactions that will move a market frequently, and generally only in response to unusual market or issuer events, the execution of these transactions could have an adverse effect on transactions for or positions held by other clients. |
■ | it serves as investment adviser for the proprietary accounts of investment consultants and/or their affiliates, and as adviser or subadviser to funds offered by investment consultants and/or their affiliates; |
■ | it invites investment consultants to events or other entertainment hosted by PGIM Fixed Income; |
■ | it purchases software applications, market data, access to databases, technology services and other products or services from certain investment consultants; and |
■ | it may pay for the opportunity to participate in conferences organized by investment consultants. |
Securities Lending Activities | |
Gross income from securities lending activities | $278,965 |
Fees and/or compensation for securities lending activities and related services | |
Fees paid to securities lending agent from a revenue split | $(5,237) |
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) | $(7,666) |
Administrative fees not included in revenue split | $0 |
Indemnification fee not included in revenue split | $0 |
Rebate (paid to borrower) | $(205,938) |
Other fees not included in revenue split (specify) | $0 |
Aggregate fees/compensation for securities lending activities | $(218,841) |
Securities Lending Activities | |
Net income from securities lending activities | $60,124 |
Fees Paid to PMFS | Amount |
PGIM Income Builder Fund | $104,439 |
Payments Received by the Distributor | |
PGIM Income Builder Fund | |
Class A Distribution and Service (12b-1) fees | $382,664 |
Payments Received by the Distributor | |
PGIM Income Builder Fund | |
Class A Initial Sales Charges | $266,610 |
Class A Contingent Deferred Sales Charges (CDSC) | $- |
Class B Distribution and Service (12b-1) fees | $14,170 |
Class B Contingent Deferred Sales Charges (CDSC) | $601 |
Class C Distribution and Service (12b-1) fees | $1,034,406 |
Class C Contingent Deferred Sales Charges (CDSC) | $5,556 |
Class R Distribution and Service (12b-1) fees | $8,938 |
Amounts Spent by Distributor | |||||
Fund | Share Class | Printing & Mailing Prospectuses to Other than Current Shareholders | Compensation to Broker/Dealers for Commissions to Representatives and Other Expenses* | Overhead Costs ** | Total Amount Spent by Distributor |
PGIM Income Builder Fund | |||||
Class A | $0 | $388,270 | $14,691 | $402,961 | |
Class B | $0 | $3,587 | $0 | $3,587 | |
Class C | $0 | $1,008,605 | $24,994 | $1,033,599 | |
Class R | $0 | $1,680 | $3,168 | $4,848 |
■ | Prudential Retirement |
■ | Wells Fargo Advisors, LLC |
■ | Ameriprise Financial, Inc. |
■ | Charles Schwab & Co, Inc. |
■ | Morgan Stanley Smith Barney |
■ | Raymond James Financial |
■ | Merrill Lynch Pierce Fenner & Smith, Inc. |
■ | National Financial Services |
■ | UBS |
■ | LPL Financial LLC |
■ | Edward Jones |
■ | Great-West |
■ | Commonwealth Financial Network |
■ | Principal Securities, Inc. |
■ | Cetera Advisor Networks |
■ | Matrix Financial Group |
■ | Voya Financial |
■ | PNC |
■ | AIG Advisor Group |
■ | American United Life Insurance Co. |
■ | ADP Broker Dealer, Inc. |
■ | Nationwide Investment Services Co. |
■ | John Hancock |
■ | Massachusetts Mutual |
■ | TIAA-CREF |
■ | Ascensus, Inc. |
■ | Midatlantic Capital Group |
■ | Reliance Trust Company |
■ | The Hartford |
■ | Standard Insurance Company |
■ | Northwestern Mutual |
■ | Alight Financial Solutions |
■ | Securities America, Inc. |
■ | Cambridge Investment Research |
■ | T. Rowe Price |
■ | Valic Financial Advisors, Inc. |
■ | Lincoln Financial Group |
■ | RBC Capital Markets, LLC |
■ | The Ohio National Life Insurance Company |
■ | TD Ameritrade |
■ | Sammons Retirement Solutions |
■ | The Vanduard Group, Inc. |
■ | Conduent, Inc. |
■ | Genworth Financial, Inc. |
■ | Citigroup, Inc. |
■ | Security Benefit |
■ | Newport Group, Inc. |
■ | Janney Montgomery Scott, LLC |
■ | Securities Service Network, LLC |
■ | KMS Financial Services, Inc. |
■ | Investacorp |
■ | Northern Trust |
■ | Oppenheimer & Co, Inc. |
Class A | |
NAV and redemption price per Class A share | $9.69 |
Maximum initial sales charge (4.50% of public offering price) | $0.46 |
Maximum offering price to public | $10.15 |
Class B | |
NAV, offering price and redemption price per Class B share | $9.49 |
Class C | |
NAV, offering price and redemption price per Class C share | $9.49 |
Class R | |
NAV, offering price and redemption price per Class R share | $9.68 |
Class Z | |
NAV, offering price and redemption price per Class Z share | $9.76 |
Class R6 | |
NAV, offering price and redemption price per Class R6 share | $9.76 |
Brokerage Commissions Paid by the Fund | 2019 | 2018 | 2017 |
Total brokerage commissions paid by the Fund | $400,378 | $325,565 | $351,478 |
Total brokerage commissions paid to affiliated brokers | None | None | None |
Percentage of total brokerage commissions paid to affiliated brokers | 0.00% | 0.00% | 0.00% |
Percentage of the aggregate dollar amount of portfolio transactions involving the payment of commissions to affiliated brokers | 0.00% | 0.00% | 0.00% |
Broker-Dealer Securities Holdings ($) (as of most recently completed fiscal year) | |||
Fund Name | Broker/Dealer Name | Equity/Debt | Amount |
PGIM Income Builder Fund | Merrill Lynch Professional Clearing Corp | Equity | 1,797,775 |
J.P. Morgan Securities LLC | Equity | 2,305,773 |
Principal Fund Shareholders (as of December 10, 2019) | |||
Fund Name and Share Class | Shareholder Name and Address | No. of Shares | % of Class |
PGIM Income Builder Fund – Class A | National Financial Services LLC For Exclusive Benefit of Our Customers Attn: Mutual Funds Dept – 4th Floor 499 Washington Blvd Jersey City, NJ 07310 | 2,703,759.646 | 16.79% |
Wells Fargo Clearing Svcs LLC Special Custody Acct for the Exclusive Benefit of Customer 2801 Market St. Saint Louis, MO 63103-2523 | 2,303,655.194 | 14.31% | |
Edward Jones & Co. Attn: Mutual Fund Shareholder Accounting 201 Progress Pkwy Maryland Hts, MO 63043-3003 | 1,567,164.345 | 9.73% | |
Pershing LLC 1 Pershing Plaza Jersey City, NJ 07399-0002 | 923,262.011 | 5.73% | |
PGIM Income Builder Fund – Class B | National Financial Services LLC For Exclusive Benefit of Our Customers Attn: Mutual Funds Dept – 4th Floor 499 Washington Blvd Jersey City, NJ 07310 | 27,699.124 | 23.71% |
Wells Fargo Clearing Svcs LLC Special Custody Acct for the Exclusive Benefit of Customer 2801 Market St. Saint Louis, MO 63103-2523 | 18,383.203 | 15.74% | |
American Enterprise Investment Svc 707 2nd Ave South Minneapolis, MN 55402-2405 | 10,924.411 | 9.35% | |
Morgan Stanley Smith Barney LLC For Exclusive Benefit of its Customers 1 New York Plaza – Fl 12 New York, NY 10004-1901 | 9,422.400 | 8.07% | |
Oppenheimer & Co Inc. FBO Marino Living Trust UAD Steven L Marino & Christine M Marino Trustees 251 N Iowa Ave | 6,426.738 | 5.50% | |
PGIM Income Builder Fund – Class C | Wells Fargo Clearing Svcs LLC Special Custody Acct for the Exclusive Benefit of Customer 2801 Market St. Saint Louis, MO 63103-2523 | 1,717,850.774 | 16.25% |
American Enterprise Investment Svc 707 2nd Ave South Minneapolis, MN 55402-2405 | 1,119,010.084 | 10.59% | |
Raymond James Omnibus for Mutual Funds House Acct Firm 92500015 Attn: Courtney Waller 880 Carillon Parkway St. Petersburg, FL 33716 | 1,095,695.926 | 10.37% | |
Morgan Stanley Smith Barney LLC For Exclusive Benefit of its Customers 1 New York Plaza – Fl 12 New York, NY 10004-1901 | 1,066,038.469 | 10.09% | |
Charles Schwab Co. Special Custody Acct FBO Customers Attn: Mutual Funds 211 Main St. San Francisco, CA 94105-1901 | 951,876.574 | 9.01% |
Principal Fund Shareholders (as of December 10, 2019) | |||
Fund Name and Share Class | Shareholder Name and Address | No. of Shares | % of Class |
National Financial Services LLC For Exclusive Benefit of Our Customers Attn: Mutual Funds Dept – 4th Floor 499 Washington Blvd Jersey City, NJ 07310 | 889,180.325 | 8.41% | |
LPL Financial 4707 Executive Drive San Diego, CA 92121-3091 | 835,535.401 | 7.91% | |
Pershing LLC 1 Pershing Plaza Jersey City, NJ 07399-0002 | 818,795.642 | 7.75% | |
Merrill Lynch, Pierce, Fenner & Smith For the Sole Benefit of its Customer 4800 Deer Lake Dr. E Jacksonville, FL 32246-6484 | 537,855.748 | 5.09% | |
PGIM Income Builder Fund – Class R | National Financial Services LLC For Exclusive Benefit of Our Customers Attn: Mutual Funds Dept – 4th Floor 499 Washington Blvd Jersey City, NJ 07310 | 139,072.681 | 78.75% |
Ascensus Trust Company FBO Cosco, Inc. 401(K) Profit Sharing Ascensus Trust Company PO BOX 10577 Fargo, ND 58106“ | 29,245.675 | 16.56% | |
PGIM Income Builder Fund – Class Z | Morgan Stanley Smith Barney LLC For Exclusive Benefit of its Customers 1 New York Plaza – Fl 12 New York, NY 10004-1901 | 2,722,535.595 | 17.67% |
Merrill Lynch, Pierce, Fenner & Smith For the Sole Benefit of its Customer 4800 Deer Lake Dr. E Jacksonville, FL 32246-6484 | 2,326,045.858 | 15.09% | |
American Enterprise Investment Svc 707 2nd Ave South Minneapolis, MN 55402-2405 | 1,676,480.963 | 10.88% | |
Wells Fargo Clearing Svcs LLC Special Custody Acct for the Exclusive Benefit of Customer 2801 Market St. Saint Louis, MO 63103-2523 | 1,625,150.611 | 10.55% | |
LPL Financial 4707 Executive Drive San Diego, CA 92121-3091 | 1,625,003.866 | 10.54% | |
Pershing LLC 1 Pershing Plaza Jersey City, NJ 07399-0002 | 1,324,606.121 | 8.60% | |
Raymond James Omnibus for Mutual Funds House Acct Firm 92500015 Attn: Courtney Waller 880 Carillon Parkway St. Petersburg, FL 33716 | 1,113,223.733 | 7.22% | |
National Financial Services LLC For Exclusive Benefit of Our Customers Attn: Mutual Funds Dept – 4th Floor 499 Washington Blvd Jersey City, NJ 07310 | 889,126.980 | 5.77% |
Principal Fund Shareholders (as of December 10, 2019) | |||
Fund Name and Share Class | Shareholder Name and Address | No. of Shares | % of Class |
Charles Schwab Co. Special Custody Acct FBO Customers Attn: Mutual Funds 211 Main St. San Francisco, CA 94105-1901 | 832,979.892 | 5.41% | |
PGIM Income Builder Fund – Class R6 | Edward Jones & Co. Attn: Mutual Fund Shareholder Accounting 201 Progress Pkwy Maryland Hts, MO 63043-3003 | 520,621.396 | 98.30% |
■ | After a shareholder is deceased or permanently disabled (or, in the case of a trust account, after the death or disability of the grantor). This waiver applies to individual shareholders as well as shares held in joint tenancy, provided the shares were purchased before the death or permanent disability, |
■ | To provide for certain distributions—made without IRS penalty—from a qualified or tax-deferred retirement plan, benefit plan, IRA or Section 403(b) custodial account, |
■ | To withdraw excess contributions from a qualified or tax-deferred retirement plan, IRA or Section 403(b) custodial account, and |
■ | On certain redemptions effected through a Systematic Withdrawal Plan (Class B shares only). |
■ | A request for release of portfolio holdings shall be prepared setting forth a legitimate business purpose for such release which shall specify the Fund(s), the terms of such release, and frequency (e.g., level of detail, staleness). Such request shall address whether there are any conflicts of interest between the Fund and the investment adviser, subadviser, principal underwriter or any affiliated person thereof and how such conflicts shall be dealt with to demonstrate that the disclosure is in the best interest of the shareholders of the Fund(s). |
■ | The request shall be forwarded to PGIM Investments’ Product Development Group and to the Chief Compliance Officer or his delegate for review and approval. |
■ | A confidentiality agreement in the form approved by the Fund officer must be executed by the recipient of the portfolio holdings. |
■ | The Fund officer shall approve the release and the agreement. Copies of the release and agreement shall be sent to PGIM Investments’ Law Department. |
■ | Written notification of the approval shall be sent by such officer to PGIM Investments’ Fund Administration Group to arrange the release of portfolio holdings. |
■ | PGIM Investments’ Fund Administration Group shall arrange the release by the Custodian Bank. |
■ | Full holdings on a daily basis to Institutional Shareholder Services (ISS), Broadridge and Glass, Lewis & Co. (proxy voting administrator/agents) at the end of each day; |
■ | Full holdings on a daily basis to ISS (securities class action claims administrator) at the end of each day; |
■ | Full holdings on a daily basis to the Fund's subadviser(s), Custodian Bank, sub-custodian (if any) and accounting agents (which includes the Custodian Bank and any other accounting agent that may be appointed) at the end of each day. When the Fund has more than one subadviser, each subadviser receives holdings information only with respect to the “sleeve” or segment of the Fund for which the subadviser has responsibility; |
■ | Full holdings to the Fund's independent registered public accounting firm as soon as practicable following the Fund's fiscal year-end or on an as-needed basis; |
■ | Full holdings to the Fund’s counsel on an as-needed basis; |
■ | Full holdings to counsel of the Fund’s independent board members on an as-needed basis; and |
■ | Full holdings to financial printers as soon as practicable following the end of the Fund's quarterly, semi-annual and annual period-ends. |
■ | Fund trades on a quarterly basis to Abel/Noser Corp. (an agency-only broker and transaction cost analysis company) as soon as practicable following the Fund's fiscal quarter-end; |
■ | Full holdings on a daily basis to FactSet Research Systems, Inc. (investment research provider) at the end of each day; |
■ | Full holdings on a daily basis to FT Interactive Data (a fair value information service) at the end of each day; |
■ | Full holdings on a quarterly basis to Frank Russell Company (investment research provider) when made available; |
■ | Full holdings on a monthly basis to Fidelity Advisors (wrap program provider) approximately five days after the end of each month (PGIM Jennison Growth Fund and certain other selected PGIM Funds only); |
■ | Full holdings on a daily basis to ICE (InterContinental Exchange), IHS Markit and Thompson Reuters (securities valuation); |
■ | Full holdings on a daily basis to Standard & Poor’s Corporation (securities valuation); |
■ | Full holdings on a monthly basis to FX Transparency (foreign exchange/transaction analysis) when made available. |
I. | Policy |
II. | Procedures |
■ | Jennison managing the pension plan of the issuer. |
■ | Jennison or its affiliates have a material business relationship with the issuer. |
■ | Jennison investment professionals who are related to a person who is senior management or a director at a public company. |
■ | Jennison has a material investment in a security that the investment professional who is responsible for voting that security’s proxy also holds the same security personally. |
III. | Internal Controls |
■ | Review potential Material Conflicts and decide whether a material conflict is present, and needs to be addressed according to these policies and procedures. |
■ | Review the Guidelines in consultation with the Investment Professionals and make revisions as appropriate. |
■ | Review these Policies and Procedures annually for accuracy and effectiveness, and recommend and adopt any necessary changes. |
■ | Review all Guideline overrides. |
■ | Review quarterly voting metrics and analysis published by the Proxy Team. |
■ | Review the performance of the proxy voting vendor and determine whether Jennison should continue to retain their services. |
IV. | Escalating Concerns |
V. | Discipline and Sanctions |
■ | Leading market positions in well-established industries. |
■ | High rates of return on funds employed. |
■ | Conservative capitalization structure with moderate reliance on debt and ample asset protection. |
■ | Broad margins in earnings coverage of fixed financial charges and high internal cash generation. |
■ | Well-established access to a range of financial markets and assured sources of alternate liquidity. |
■ | Amortization schedule-the longer the final maturity relative to other maturities the more likely it will be treated as a note. |
■ | Source of payment-the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note. |
Name and Principal Business Address | Positions and Offices with Underwriter | Positions and Offices with Registrant | ||
Adam Scaramella (1) | President | N/A | ||
Gary F. Neubeck (2) | Executive Vice President | N/A | ||
Stuart S. Parker (2) | Executive Vice President | Board Member and President | ||
James Gemus (2) | Executive Vice President | N/A | ||
Scott E. Benjamin (2) | Vice President | Board Member and Vice President | ||
Francine Boucher (1) | Senior Vice President, Chief Legal Officer and Secretary | N/A | ||
Peter J. Boland (2) | Senior Vice President and Chief Operating Officer | N/A | ||
John N. Christolini (3) | Senior Vice President | N/A | ||
Mark R. Hastings (2) | Senior Vice President and Chief Compliance Officer | N/A | ||
Robert Smit (2) | Senior Vice President, Comptroller and Chief Financial Officer | N/A | ||
Hansjerg Schlenker (2) | Senior Vice President and Chief Operations Officer | N/A | ||
Monica Oswald (3) | Senior Vice President and Co-Chief Operations Officer | N/A | ||
Charles Smith (4) | Vice President and Anti-Money Laundering Officer | Anti-Money Laundering Compliance Officer |
(1) | 213 Washington Street, Newark, NJ 07102 |
(2) | 655 Broad Street, Newark, NJ 07102 |
(3) | 280 Trumbull Street, Hartford, CT 06103 |
(4) | 751 Broad Street, Newark NJ, 07102 |
Prudential Investment Portfolios 16 |
* |
Stuart S. Parker, President |
Signature | Title | Date | ||
* Ellen S. Alberding | Trustee | |||
* Kevin J. Bannon | Trustee | |||
* Scott E. Benjamin | Trustee | |||
* Linda W. Bynoe | Trustee | |||
* Barry H. Evans | Trustee | |||
* Keith F. Hartstein | Trustee | |||
* Laurie Simon Hodrick | Trustee | |||
* Michael S. Hyland | Trustee | |||
* Stuart S. Parker | Trustee and President, Principal Executive Officer | |||
* Brian K. Reid | Trustee | |||
* Grace C. Torres | Trustee | |||
* Christian J. Kelly | Treasurer, Principal Financial and Accounting Officer | |||
*By: /s/ Jonathan D. Shain Jonathan D. Shain | Attorney-in-Fact | December 26, 2019 |
/s/ Ellen S. Alberding Ellen S. Alberding | /s/ Laurie Simon Hodrick Laurie Simon Hodrick |
/s/ Kevin J. Bannon Kevin J. Bannon | /s/ Michael S. Hyland Michael S. Hyland |
/s/ Scott E. Benjamin Scott E. Benjamin | /s/ Christian J. Kelly Christian J. Kelly |
/s/ Linda W. Bynoe Linda W. Bynoe | /s/ Stuart S. Parker Stuart S. Parker |
/s/ Barry H. Evans Barry H. Evans | /s/ Brian K. Reid Brian K. Reid |
/s/ Keith F. Hartstein Keith F. Hartstein | /s/ Grace C. Torres Grace C. Torres |
Dated: March 7, 2019 |
Item 28 Exhibit No. | Description | |
(d)(8) | Expense cap for PGIM Income Builder Fund. | |
(j) | Consent of independent registered public accounting firm. | |
(m)(5) | Rule 12b-1 fee waiver for Class A shares and Class R shares of PGIM Income Builder Fund. |
PGIM Investments LLC
655 Broad Street – 17th Floor
Newark, New Jersey 07102
November 1, 2019
The Board of Trustees
Prudential Investment Portfolios 16
655 Broad Street—17th Floor
Newark, New Jersey 07102
Re: PGIM Income Builder Fund (the Fund)
To the Board of Trustees:
PGIM Investments LLC (PGIM Investments) has contractually agreed, through February 28, 2021, to limit Total Annual Fund Operating Expenses after fee waivers and/or expense reimbursements to 0.95% of average daily net assets for Class A shares, 1.70% of average daily net assets for Class B shares, 1.70% of average daily net assets for Class C shares, 1.20% of average daily net assets for Class R shares, 0.70% of average daily net assets for Class Z shares, and 0.70% of average daily net assets for Class R6 shares. This contractual waiver includes acquired fund fees and expenses, and excludes Fund and any acquired fund interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), extraordinary expenses, and certain other Fund expenses such as dividend and interest expense and broker charges on short sales. Where applicable, PGIM Investments agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives such expenses on any other share class. In addition, Total Annual Fund Operating Expenses for Class R6 shares will not exceed Total Annual Fund Operating Expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by PGIM Investments may be recouped by PGIM Investments within the same fiscal year during which such waiver and/or reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year. This waiver may not be terminated prior to February 28, 2021 without the prior approval of the Fund’s Board of Trustees.
Very truly yours,
PGIM INVESTMENTS LLC
By:/s/ Scott E. Benjamin
Name:Scott E. Benjamin
Title:Executive Vice President
Consent of Independent Registered Public Accounting Firm
The Board of Trustees
Prudential Investment Portfolios 16:
We consent to the use of our report dated December 19, 2019, with respect to the financial statements and financial highlights of PGIM Income Builder Fund, a series of Prudential Investment Portfolios 16, as of October 31, 2019, and for the respective years or periods presented therein, incorporated by reference herein. We also consent to the references to our firm under the headings “Financial Highlights” in the prospectus and “Other Service Providers – Independent Registered Public Accounting Firm” and “Financial Statements” in the statement of additional information.
New York, New York
December 23, 2019
PRUDENTIAL INVESTMENT PORTFOLIOS 16
PGIM Income Builder Fund
Notice of Rule 12b-1 Fee Waiver
Class A Shares
Class R Shares
THIS NOTICE OF RULE 12b-1 FEE WAIVER is signed as of November 1, 2019 by PRUDENTIAL INVESTMENT MANAGEMENT SERVICES LLC (PIMS), the Principal Underwriter of PGIM Income Builder Fund (the Fund), a series of PRUDENTIAL INVESTMENT PORTFOLIOS 16 (the RIC), an open-end management investment company.
WHEREAS, PIMS desires to waive a portion of its distribution and shareholder services fees payable on Class A shares of the Fund (Rule 12b-1 fees); and
WHEREAS, PIMS desires to waive a portion of its distribution and shareholder services fees payable on Class R shares of the Fund (Rule 12b-1 fees); and
WHEREAS, PIMS understands and intends that the RIC will rely on this Notice and agreement in preparing a registration statement on Form N-1A and in accruing the Fund’s expenses for purposes of calculating net asset value and for other purposes, and expressly permits the Fund to do so; and
WHEREAS, shareholders of the Fund will benefit from the ongoing contractual waiver by incurring lower Fund operating expenses than they would absent such waiver.
NOW, THEREFORE, PIMS hereby provides notice that it has agreed to limit the distribution and service (12b-1) fees incurred by Class A shares of the Fund to 0.25% of the average daily net assets of the Fund’s Class A shares, and it has agreed to limit the distribution and service (12b-1) fees incurred by Class R shares of the Fund to 0.50% of the average daily net assets of the Fund’s Class R shares. This contractual waiver shall be effective from the date hereof through February 28, 2021.
IN WITNESS WHEREOF, PIMS has signed this Notice of Rule 12b-1 Fee Waiver as of the day and year first above written.
PRUDENTIAL INVESTMENT
MANAGEMENT SERVICES LLC
By: /s/ Scott E. Benjamin
Name: Scott E. Benjamin
Title: Vice President
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