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Prudential Equity Fund, Inc.
Supplement dated November 14, 1996 to
Prospectus dated March 1, 1996
The following information supplements ``How the Fund Invests--Other
Investments and Policies--Securities Lending'' in the Prospectus:
On October 30, 1996, shareholders approved changes in the Fund's investment
restrictions to enable the Fund to lend its portfolio securities to brokers,
dealers and financial institutions, provided that outstanding loans (i) do not
exceed in the aggregate 30% of the value of the Fund's total assets, (ii) are
callable at any time by the Fund and (iii) are at all times secured by cash or
equivalent collateral (which may include a secured letter of credit) that is
equal to at least the market value, determined daily, of the loaned securities.
During the time portfolio securities are on loan, the borrower will pay the Fund
an amount equivalent to any dividend or interest paid on such securities and the
Fund may invest the cash collateral and earn additional income, or it may
receive an agreed-upon amount of interest income from the borrower who has
delivered equivalent collateral.
The following information supplements ``How the Fund Invests--Hedging and
Return Enhancement Strategies--Options Transactions'' and ``How the Fund
Invests--Other Investments and Policies--When-Issued and Delayed Delivery
Securities''
In circumstances where the Fund's custodian maintains a segregated account
of the Fund for options transactions or the purchase of when-issued and delayed
delivery securities, the funds to be maintained in a segregated account include
cash, U.S. Government securities, equity securities or other liquid,
unencumbered assets, marked-to-marked daily, having a value equal to or greater
than the Fund's commitments.
MF 101C-3 (11/14/96)
