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Exhibit (p)(1)
PRUDENTIAL CORE INVESTMENT FUND
(the Fund)
Code of Ethics Adopted Pursuant to Rule 17j-1
Under the Investment Company Act of 1940
(the Code)
1. Purposes
The Code has been adopted by the Board of Directors/Trustees of the
Fund in accordance with Rule 17j-1(b) under the Investment Company Act of 1940
(the Act) and in accordance with the following general principles:
(1) The duty at all times to place the interests of
shareholders first.
Investment company personnel should scrupulously
avoid serving their own personal interests ahead of
shareholders' interests in any decision relating to their
personal investments.
(2) The requirement that all personal securities transactions
be conducted consistent with the Code and in such a manner as
to avoid any actual or potential conflict of interest or any
abuse of an individual's position of trust and responsibility.
Investment company personnel must not only seek to
achieve technical compliance with the Code but should strive
to abide by its spirit and the principles articulated herein.
(3) The fundamental standard that investment company personnel
should not take inappropriate advantage of their positions.
Investment company personnel must avoid any situation
that might compromise, or call into question, their exercise
of fully independent judgment in the interest of shareholders,
including, but not limited to the receipt of unusual
investment opportunities, perquisites, or gifts of more than a
de minimis value from persons doing or seeking business with
the Fund.
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Rule 17j-1 under the Act generally proscribes fraudulent or
manipulative practices with respect to purchases or sales of securities held or
to be acquired by investment companies, if effected by associated persons of
such companies.
The purpose of the Code is to establish procedures consistent with the
Act and Rule 17j-1 to give effect to the following general prohibitions as set
forth in Rule 17j-1:
(a) It shall be unlawful for any affiliated person of or
principal underwriter for a registered investment company, or any
affiliated person of an investment adviser of or principal underwriter
for a registered investment company in connection with the purchase or
sale, directly or indirectly, by such person of a security held or to
be acquired, as defined in this section, by such registered investment
company --
(1) To employ any device, scheme or artifice to
defraud such registered investment company;
(2) To make to such registered investment company any
untrue statement of a material fact or omit to state to such
registered investment company a material fact necessary in
order to make the statements made, in light of the
circumstances under which they are made, not misleading;
(3) To engage in any act, practice, or course of
business which operates or would operate as a fraud or deceit
upon any such registered investment company; or
(4) To engage in any manipulative practice with
respect to such registered investment company.
2. Definitions
(a) "Access Person" means any director/trustee, officer,
general partner or Advisory Person (including any Investment Personnel,
as that term is defined herein) of the Fund, the Manager or the
Adviser/Subadviser.
(b) "Adviser/Subadviser" means the Adviser or Subadviser of
the Fund or both as the context may require.
(c) "Advisory Person" means (i) any employee of the Fund,
Manager or Adviser/Subadviser (or of any company in a control
relationship to the Fund, Manager or Adviser/Subadviser) who, in
connection with his or her regular functions or duties, makes,
participates in, or obtains information regarding the purchase or sale
of a security by
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the Fund, or whose functions relate to the making of any
recommendations with respect to such purchases or sales; and (ii) any
natural person in a control relationship to the Fund who obtains
information concerning recommendations made to the Fund with regard to
the purchase or sale of a security.
(d) "Beneficial Ownership" will be interpreted in the same
manner as it would be in determining which security holdings of a
person are subject to the reporting and short-swing profit provisions
of Section 16 of the Securities Exchange Act of 1934 and the rules and
regulations thereunder, except that the determination of direct or
indirect beneficial ownership will apply to all securities which an
Access Person has or acquires (Exhibit A).
(e) "Complex" means the group of registered investment
companies for which Prudential Investments Fund Management LLC serves
as Manager; provided, however, that with respect to Access Persons of
the Subadviser (including any unit or subdivision thereof), "Complex"
means the group of registered investment companies in the Complex
advised by the Subadviser or unit or subdivision thereof.
(f) "Compliance Officer" means the person designated by the
Manager or the Adviser/Subadviser (including his or her designee) as
having responsibility for compliance with the requirements of the Code.
(g) "Control" will have the same meaning as that set forth in
Section 2(a)(9) of the Act.
(h) "Disinterested Director/Trustee" means a Director/Trustee
of the Fund who is not an "interested person" of the Fund within the
meaning of Section 2(a)(19) of the Act.
An interested Director/Trustee who would not otherwise be
deemed to be an Access Person, shall be treated as a Disinterested
Director/Trustee for purposes of compliance with the provisions of the
Code.
(i) "Investment Personnel" means Portfolio Managers and other
Advisory Persons who provide investment information and/or advice to
the Portfolio Manager(s) and/or help execute the Portfolio
Manager's(s') investment decisions, including securities analysts and
traders.
(j) "Manager" means Prudential Investments Fund Management LLC
(k) "Portfolio Manager" means any Advisory Person who has the
direct responsibility and authority to make investment decisions for
the Fund.
(l) "Purchase or sale of a Security" includes, inter alia, the
writing of an option to purchase or sell a security.
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(m) "Security" will have the meaning set forth in Section
2(a)(36) of the Act, except that it will not include shares of
registered open-end investment companies, securities issued by the
United States Government, short-term debt securities which are
"government securities" within the meaning of Section 2(a)(16) of the
Act, bankers' acceptances, bank certificates of deposit, commercial
paper and such other money market instruments as are designated by the
Compliance Officer. For purposes of the Code, an "equivalent Security"
is one that has a substantial economic relationship to another
Security. This would include, among other things, (1) a Security that
is convertible into another Security, (2) with respect to an equity
Security, a Security having the same issuer (including a private issue
by the same issuer) and any derivative, option or warrant relating to
that Security and (3) with respect to a fixed-income Security, a
Security having the same issuer, maturity, coupon and rating.
3. Applicability
The prohibitions described below will only apply to a transaction in a
Security in which the designated Access Person has, or by reason of such
transaction acquires, any direct or indirect Beneficial Ownership.
4. Prohibited Purchases and Sales
A. Initial Public Offerings
No Investment Personnel may acquire any Securities in an initial public
offering.
B. Private Placements
No Investment Personnel may acquire any Securities in a private
placement without express prior approval.
(i) Prior approval must be obtained in accordance with the
preclearance procedure described in Section 6 below. Such approval will
take into account, among other factors, whether the investment
opportunity should be reserved for the Fund and its shareholders and
whether the opportunity is being offered to the Investment Personnel by
virtue of his or her position with the Fund.
(ii) Investment Personnel who have been authorized to acquire
Securities in a private placement must disclose that investment to the
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chief investment officer (including his or her designee) of the
Adviser/Subadviser (or of any unit or subdivision thereof) or the
Compliance Officer when they play a part in any subsequent
consideration of an investment by the Fund in the issuer. In such
circumstances, the Fund's decision to purchase Securities of the issuer
will be subject to an independent review by appropriate personnel with
no personal interest in the issuer.
C. Blackout Periods
(i) Except as provided in Section 5 below, Access Persons are
prohibited from executing a Securities transaction on a day during which any
investment company in the Complex has a pending "buy" or "sell" order in the
same or an equivalent Security and until such time as that order is executed or
withdrawn; provided, however, that this prohibition shall not apply to
Disinterested Directors/Trustees except if they have actual knowledge of trading
by any fund in the Complex and, in any event, only with respect to those funds
on whose boards they sit.
This prohibition shall also not apply to Access Persons of the
Subadviser who do not, in the ordinary course of fulfilling his or her official
duties, have access to information regarding the purchase and sale of Securities
for the Fund and are not engaged in the day-to-day operations of the Fund;
provided that Securities investments effected by such Access Persons during the
proscribed period are not effected with knowledge of the purchase or sale of the
same or equivalent Securities by any fund in the Complex.
A "pending 'buy' or 'sell' order" exists when a decision to purchase or
sell a Security has been made and communicated.
(ii) Portfolio Managers are prohibited from buying or selling a
Security within seven calendar days before or after the Fund trades in the same
or an equivalent Security.
(iii) If trades are effected during the periods proscribed in (i) or
(ii) above, except as provided in (iv) below with respect to (i) above, any
profits realized on such trades will be immediately required to be disgorged to
the Fund.
(iv) A transaction by Access Persons (other than Investment Personnel)
inadvertently effected during the period proscribed in (i) above will not be
considered a violation of the Code and disgorgement will not be required so long
as the transaction was effected in accordance with the preclearance procedures
described in Section 6 below and without prior knowledge of trading by any fund
in the Complex in the same or an equivalent Security.
D. Short-Term Trading Profits
Except as provided in Section 5 below, Investment Personnel are
prohibited from profiting from a purchase and sale, or sale and purchase, of the
same or an equivalent Security within any 60 calendar day period. If trades are
effected during the proscribed period, any profits realized on such trades will
be immediately required to be disgorged to the Fund.
5. Exempted Transactions
Subject to preclearance in accordance with Section 6 below with respect
to subitems (b), (e), (f), (g), (h) and (i) hereof, the prohibitions of Sections
4(C) and 4(D) will not apply to the following:
(a) Purchases or sales of Securities effected in any account
over which the Access Person has no direct or indirect influence or
control or in any account of the Access Person which is managed on a
discretionary basis by a person other than such Access Person and with
respect to which such Access Person does not in fact influence or
control such transactions.
(b) Purchases or sales of Securities (or their equivalents)
which are not eligible for purchase or sale by any fund in the Complex.
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(c) Purchases or sales of Securities which are non-volitional
on the part of either the Access Person or any fund in the Complex.
(d) Purchases of Securities which are part of an automatic
dividend reinvestment plan.
(e) Purchases effected upon the exercise of rights issued by
an issuer pro rata to all holders of a class of its Securities, to the
extent such rights were acquired from such issuer, and sales of such
rights so acquired.
(f) Any equity Securities transaction, or series of related
transactions effected over a 30 calendar day period, involving 500
shares or less in the aggregate, if (i) the Access Person has no prior
knowledge of activity in such security by any fund in the Complex and
(ii) the issuer is listed on The New York Stock Exchange or has a
market capitalization (outstanding shares multiplied by the current
price per share) greater than $1 billion (or a corresponding market
capitalization in foreign markets).
(g) Any fixed-income Securities transaction, or series of
related transactions effected over a 30 calendar day period, involving
100 units ($100,000 principal amount) or less in the aggregate, if the
Access Person has no prior knowledge of transactions in such Securities
by any fund in the Complex.
(h) Any transaction in index options effected on a broad-based
index if the Access Person has no prior knowledge of activity in such
index by any fund in the Complex.
(i) Purchases or sales of Securities which receive the prior
approval of the Compliance Officer (such person having no personal
interest in such purchases or sales), based on a determination that no
abuse is involved and that such purchases and sales are not likely to
have any economic impact on any fund in the Complex or on its ability
to purchase or sell Securities of the same class or other Securities of
the same issuer.
6. Preclearance
Access Persons (other than Disinterested Directors/Trustees) must
preclear all personal Securities investments with the exception of those
identified in subparts (a), (c) and (d) of Section 5 above.
All requests for preclearance must be submitted to the Compliance
Officer for approval. All approved orders must be executed by the close of
business on the day preclearance is granted; provided, however, that approved
orders for Securities traded
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in foreign markets may be executed within two (2) business days from the date
preclearance is granted. If any order is not timely executed, a request for
preclearance must be resubmitted.
7. Reporting
(a) Disinterested Directors/Trustees shall report to the Secretary of
the Fund or the Compliance Officer the information described in Section 7(b)
hereof with respect to transactions in any Security in which such Disinterested
Director/Trustee has, or by reason of such transaction acquires, any direct or
indirect Beneficial Ownership in the Security only if such Disinterested
Director/Trustee, at the time of that transaction knew or, in the ordinary
course of fulfilling his or her official duties as a Director/Trustee of the
Fund, should have known that, during the 15-day period immediately preceding or
subsequent to the date of the transaction in a Security by such
Director/Trustee, such Security is or was purchased or sold by the Fund or was
being considered for purchase or sale by the Fund, the Manager or
Adviser/Subadviser; provided, however, that a Disinterested Director/Trustee is
not required to make a report with respect to transactions effected in any
account over which such Director/Trustee does not have any direct or indirect
influence or control or in any account of the Disinterested Director/Trustee
which is managed on a discretionary basis by a person other than such
Director/Trustee and with respect to which such Director/Trustee does not in
fact influence or control such transactions. The Secretary of the Fund or the
Compliance Officer shall maintain such reports and such other records to the
extent required by Rule 17j-1 under the Act.
(b) Every report required by Section 7(a) hereof shall be made not
later than ten days after the end of the calendar quarter in which the
transaction to which the report relates was effected, and shall contain the
following information:
(i) The date of the transaction, the title and the number of
shares, and the
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principal amount of each Security involved;
(ii) The nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(iii) The price at which the transaction was effected; and
(iv) The name of the broker, dealer or bank with or through whom
the transaction was effected.
(c) Any such report may contain a statement that the report shall not
be construed as an admission by the person making such report that he or she has
any direct or indirect Beneficial Ownership in the Security to which the report
relates.
8. Records of Securities Transactions and Post-Trade Review
Access Persons (other than Disinterested Directors/Trustees) are
required to direct their brokers to supply, on a timely basis, duplicate copies
of confirmations of all personal Securities transactions and copies of periodic
statements for all Securities accounts in which such Access Persons have a
Beneficial Ownership interest to the Compliance Officer. Compliance with this
Code requirement will be deemed to satisfy the reporting requirements imposed on
Access Persons under Rule 17j-1(c).
The Compliance Officer will periodically review the personal investment
activity of all Access Persons (including Disinterested Directors/Trustees with
respect to Securities transactions reported pursuant to Section 7 above).
9. Disclosure of Personal Holdings
Upon commencement of employment and thereafter on an annual basis,
Access Persons (other than Disinterested Directors/Trustees) must disclose all
personal Securities holdings.
10. Gifts
Access Persons are prohibited from receiving any gift or other thing of
more than $100 in value from any person or entity that does business with or on
behalf of the
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Fund. Occasional business meals or entertainment (theatrical or sporting events,
etc.) are permitted so long as they are not excessive in number or cost.
11. Service As a Director
Investment Personnel are prohibited from serving on the boards of
directors of publicly traded companies, absent prior authorization based upon a
determination that the board service would be consistent with the interests of
the Fund and its shareholders. In the limited instances that such board service
is authorized, Investment Personnel will be isolated from those making
investment decisions affecting transactions in Securities issued by any publicly
traded company on whose board such Investment Personnel serves as a director
through the use of "Chinese Wall" or other procedures designed to address the
potential conflicts of interest.
12. Certification of Compliance with the Code
Access Persons are required to certify annually as follows:
(i) that they have read and understood the Code;
(ii) that they recognize that they are subject to the Code;
(iii) that they have complied with the requirements of the Code; and
(iv) that they have disclosed or reported all personal Securities
transactions required to be disclosed or reported pursuant to
the requirements of the Code.
13. Code Violations
All violations of the Code will be reported to the Board of
Directors/Trustees of the Fund on a quarterly basis. The Board of
Directors/Trustees may take such action as it deems appropriate.
14. Review by the Board of Directors/Trustees
The Board of Directors/Trustees will be provided with an annual report
which at a minimum:
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(i) summarizes existing procedures concerning personal
investing and any changes in the procedures made during the preceding
year;
(ii) identifies any violations requiring significant remedial
action during the preceding year; and
(iii) identifies any recommended changes in existing
restrictions or procedures based upon the Fund's experience under the
Code, evolving industry practices, or developments in applicable laws
and regulations.
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Explanatory Notes to Code
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1. The information on personal employee securities transactions
received and recorded by the Manager and by the Adviser/Subadviser, in
conformity with Rule 204-2(a)(12) under the Investment Advisers Act of 1940,
under their respective current policy statements regarding personal securities
transactions of employees will be deemed to satisfy the reporting requirements
imposed on Access Persons of the Manager and of the Adviser/Subadviser under
Rule 17j-1(c).
2. No comparable Code requirements have been imposed upon Prudential
Mutual Fund Services LLC, the Fund's transfer agent, or Prudential Securities
Incorporated, which acts as the Fund's distributor, or those of their directors
or officers who are not Directors/Trustees or Officers of the Fund since they
are deemed not to constitute Access Persons or Advisory Persons as defined in
paragraphs (e)(1) and (2) of Rule 17j-1.
Dated: , 19
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Exhibit A
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Definition of Beneficial Ownership
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The term "beneficial ownership" of securities would include not only
ownership of securities held by an access person for his or her own benefit.
Whether in bearer form or registered in his or her own name or otherwise, but
also ownership of securities held for his or her benefit by other (regardless of
whether or how they are registered) such as custodians, brokers, executors,
administrators, or trustees (including trusts in which he or she has only a
remainder interest), and securities held for his or her account by pledges,
securities owned by a partnership in which he or she should regard as a personal
holding corporation. Correspondingly, this term would exclude securities held by
an access person for the benefit of someone else.
Ordinarily, this term would not include securities held by executors or
administrators in estates in which an access person is a legatee or beneficiary
unless there is a specific legacy to such person of such securities or such
person is the sole legatee or beneficiary and there are other assets in the
estate sufficient to pay debts ranking ahead of such legacy, or the securities
are held in the estate more than a year after the decedent's death.
Securities held in the name of another should be considered as
"beneficially" owned by an access person where such person enjoys "benefits
substantially equivalent to ownership". The SEC has said that although the final
determination of beneficial ownership is a question to be determined in the
light of the facts of the particular case, generally a person is regarded as the
beneficial owner of securities held in the name of his or her spouse and their
minor children. Absent special circumstances such relationship ordinarily
results in such person obtaining benefits substantially equivalent to ownership,
e.g., application of the income derived from such securities to maintain a
common home, to meet expenses which such person otherwise would meet from other
sources, or the ability to exercise a controlling influence over the purchase,
sale or voting of such securities.
An access person also may be regarded as the beneficial owner of
securities held in the name of another person, if by reason of any contact,
understanding, relationship, agreement or other arrangement, he obtains
therefrom benefits substantially equivalent to those of ownership. Moreover, the
fact that the holder is a relative or relative of a spouse and sharing the same
home as an access person may in itself indicate that the access person would
obtain benefits substantially equivalent to those of ownership from securities
held in the name of such relative. Thus, absent countervailing facts, it is
expected that securities held by relatives who share the same home as an access
person will be treated as being beneficially owned by the access person.
An access person also is regarded as the beneficial owner of securities
held in the name of a spouse, minor children or other person, even though he
does not obtain therefrom the aforementioned benefits of ownership, if he can
vest or revest title in himself at once or at some future time.
