THE PRUDENTIAL SERIES FUND, INC.
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SP JENNISON INTERNATIONAL GROWTH PORTFOLIO PROSPECTUS
SP STRATEGIC PARTNERS FOCUSED GROWTH PORTFOLIO AUGUST 11, 2000
AS WITH ALL MUTUAL FUNDS, THE U.S. 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.
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TABLE OF CONTENTS
1 RISK/RETURN SUMMARY
1 Investment Objectives and Principal Strategies
2 Principal Risks
4 Evaluating Performance
4 HOW THE PORTFOLIOS INVEST
4 Investment Objectives and Policies
4 SP Jennison International Growth Portfolio
6 SP Strategic Partners Focused Growth Portfolio
9 OTHER INVESTMENTS AND STRATEGIES
9 ADRs
9 Convertible Debt and Convertible Preferred Stock
9 Derivatives
9 Dollar Rolls
9 Forward Foreign Currency Exchange Contracts
10 Futures
10 Interest Rate Swaps
10 Joint Repurchase Account
10 Loan Participations
10 Mortgage-related Securities
10 Options
11 Real Estate Investment Trusts
11 Repurchase Agreements
11 Reverse Repurchase Agreements
11 Short Sales
11 Short Sales Against-the-Box
11 When-issued and Delayed Delivery Securities
11 HOW THE FUND IS MANAGED
11 Board of Directors
11 Investment Manager
12 Investment Sub-Advisers
12 Portfolio Managers
12 HOW TO BUY AND SELL SHARES OF THE FUND
13 Net Asset Value
14 Distributor
14 OTHER INFORMATION
14 Federal Income Taxes
14 European Monetary Union
14 Monitoring for Possible Conflicts
(For more information--see back cover)
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RISK/RETURN SUMMARY
This prospectus provides information about THE PRUDENTIAL SERIES FUND, INC. (the
Fund), which consists of thirty-seven separate portfolios (each, a Portfolio).
Only the SP Jennison International Growth Portfolio and the SP Strategic
Partners Focused Growth Portfolio are offered through this Prospectus.
The Fund offers two classes of shares in each Portfolio: Class I and Class II.
Class I shares are sold only to separate accounts of The Prudential Insurance
Company of America (Prudential) and affiliates as investment options under
variable life insurance and variable annuity contracts (the Contracts). (A
separate account keeps the assets supporting certain insurance contracts
separate from the general assets and liabilities of the insurance company.)
Class II shares are offered only to separate accounts of non-Prudential
insurance companies for the same types of Contracts. Class II shares of each
Portfolio discussed in this prospectus are available under the variable
contracts issued by Allianz Life and its affiliates.
This section highlights key information about each Portfolio available under the
Allianz variable annuity. Additional information follows this summary and is
also provided in the Fund's Statement of Additional Information (SAI). Any
percentage limitations on Portfolio investments are generally applied at the
time of purchase.
INVESTMENT OBJECTIVES AND PRINCIPAL STRATEGIES
The following summarizes the investment objectives, principal strategies and
principal risks for each of the available Portfolios. We describe the terms
"company risk," "credit risk," "derivatives risk," "foreign investment risk,"
"interest rate risk," "leveraging risk," "liquidity risk," "management risk,"
and "market risk," in the section on Principal Risks, on page 4. While we make
every effort to achieve the investment objective for each Portfolio, we can't
guarantee success.
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SP JENNISON INTERNATIONAL GROWTH PORTFOLIO
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The Portfolio's investment objective is LONG-TERM GROWTH OF CAPITAL. The
Portfolio seeks to achieve this objective by investing in equity-related
securities of foreign issuers. This means the Portfolio looks for investments
that Jennison thinks will increase in value over a period of years. To achieve
its objective, the Portfolio invests primarily in the common stock of large and
medium-sized foreign companies. Under normal circumstances, the Portfolio
invests at least 65% of its total assets in common stock of foreign companies
operating or based in at least five different countries. The Portfolio looks
primarily for stocks of companies whose earnings are growing at a faster rate
than other companies. These companies typically have characteristics such as
above average growth in earnings and cash flow, improving profitability, strong
balance sheets, management strength and strong market share for its products.
The Portfolio also tries to buy such stocks at attractive prices in relation to
their growth prospects. Loss of money is a risk of investing in this Portfolio.
This Portfolio is advised by Jennison Associates LLC.
PRINCIPAL RISKS:
O COMPANY RISK
O CREDIT RISK
O DERIVATIVES RISK
O FOREIGN INVESTMENT RISK
O INTEREST RATE RISK
O MARKET RISK
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SP STRATEGIC PARTNERS FOCUSED GROWTH PORTFOLIO
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The Portfolio's investment objective is LONG-TERM GROWTH OF CAPITAL. This means
the Portfolio seeks investments whose price will increase over several years.
The Portfolio normally invests at least 65% of its total assets in
equity-related securities of U.S. companies that the adviser believes to have
strong capital appreciation potential. The Portfolio's strategy is to combine
the efforts of two investment advisers and to invest in the favorite stock
selection ideas of three portfolio managers (two of whom invest as a team). Each
investment adviser to the Portfolio utilizes a growth style to select
approximately 20 securities. The portfolio managers build a portfolio with
stocks in which they have the highest confidence and may invest more than 5% of
the Portfolio's assets in any one issuer. The Portfolio is nondiversified,
meaning it can invest more than 5% of its assets in the securities of any one
issuer. Investing in a nondiversified portfolio, particularly a portfolio
investing in approximately 40 equity-related
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securities, involves greater risk than investing in a diversified portfolio
because a loss resulting from the decline in the value of one security may
represent a greater portion of the total assets of a nondiversified portfolio.
The Portfolio may actively and frequently trade its portfolio securities. High
portfolio turnover results in higher transaction costs and can affect the
Portfolio's performance. Loss of money is a risk of investing in this Portfolio.
This Portfolio is advised by Jennison Associates LLC and Alliance Capital
Management, L.P.
PRINCIPAL RISKS:
O COMPANY RISK
O DERIVATIVES RISK
O FOREIGN INVESTMENT RISK
O LEVERAGING RISK
O LIQUIDITY RISK
O MANAGEMENT RISK
O MARKET RISK
PRINCIPAL RISKS
Although we try to invest wisely, all investments involve risk. Like any mutual
fund, an investment in a Portfolio could lose value, and you could lose money.
The following summarizes the principal risks of investing in the Portfolios.
COMPANY RISK. The price of the stock or debt security of a particular
company can vary based on a variety of factors, such as the company's financial
performance, changes in management and product trends, and the potential for
takeover and acquisition. This is especially true with respect to equity
securities of smaller companies, whose prices may go up and down more than
equity securities of larger, more established companies. Also, since equity
securities of smaller companies may not be traded as often as equity securities
of larger, more established companies, it may be difficult or impossible for a
Portfolio to sell securities at a desirable price. Foreign securities have
additional risks, including exchange rate changes, political and economic
upheaval, the relative lack of information about these companies, relatively low
market liquidity and the potential lack of strict financial and accounting
controls and standards.
CREDIT RISK. Debt obligations are generally subject to the risk that the
issuer may be unable to make principal and interest payments when they are due.
There is also the risk that the securities could lose value because of a loss of
confidence in the ability of the borrower to pay back debt. Non-investment grade
debt - also known as "high-yield bonds" and "junk bonds" - have a higher risk of
default and tend to be less liquid than higher-rated securities.
DERIVATIVES RISK. Derivatives are financial contracts whose value depends
on, or is derived from, the value of an underlying asset, interest rate or
index. The Portfolios typically use derivatives as a substitute for taking a
position in the underlying asset and/or as part of a strategy designed to reduce
exposure to other risks, such as interest rate or currency risk. A Portfolio may
also use derivatives for leverage, in which case their use would involve
leveraging risk. A Portfolio's use of derivative instruments involves risks
different from, or possibly greater than, the risks associated with investing
directly in securities and other traditional investments. Derivatives are
subject to a number of risks described elsewhere, such as liquidity risk,
interest rate risk, market risk, credit risk and management risk. They also
involve the risk of mispricing or improper valuation and the risk that changes
in the value of the derivative may not correlate perfectly with the underlying
asset, rate or index. A Portfolio investing in a derivative instrument could
lose more than the principal amount invested. Also, suitable derivative
transactions may not be available in all circumstances.
FOREIGN INVESTMENT RISK. Investing in foreign securities generally involves
more risk than investing in securities of U.S. issuers. Foreign investment risk
is comprised of the specific risks described below.
CURRENCY RISK. Changes in currency exchange rates may affect the value of
foreign securities held by a Portfolio and the amount of income available
for distribution. If a foreign currency grows weaker relative to the U.S.
dollar, the value of securities denominated in that foreign currency
generally decreases in terms of U.S. dollars. If a Portfolio does not
correctly anticipate changes in exchange rates, its share price could
decline as a result. In addition, certain hedging activities may cause the
Portfolio to lose money and could reduce the amount of income available for
distribution.
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EMERGING MARKET RISK. To the extent that a Portfolio invests in emerging
markets to enhance overall returns, it may face higher political,
information, and stock market risks. In addition, profound social changes
and business practices that depart from norms in developed countries'
economies have sometimes hindered the orderly growth of emerging economies
and their stock markets in the past. High levels of debt may make emerging
economies heavily reliant on foreign capital and vulnerable to capital
flight.
FOREIGN MARKET RISK. Foreign markets, especially those in developing
countries, tend to be more volatile than U.S. markets and are generally not
subject to regulatory requirements comparable to those in the U.S. Because
of differences in accounting standards and custody and settlement
practices, investing in foreign securities generally involves more risk
than investing in securities of U.S. issuers.
INFORMATION RISK. Financial reporting standards for companies based in
foreign markets usually differ from those in the United States. Since the
"numbers" themselves sometimes mean different things, the sub-advisers
devote much of their research effort to understanding and assessing the
impact of these differences upon a company's financial conditions and
prospects.
LIQUIDITY RISK. Stocks that trade less can be more difficult or more costly
to buy, or to sell, than more liquid or active stocks. This liquidity risk
is a factor of the trading volume of a particular stock, as well as the
size and liquidity of the entire local market. On the whole, foreign
exchanges are smaller and less liquid than the U.S. market. This can make
buying and selling certain shares more difficult and costly. Relatively
small transactions in some instances can have a disproportionately large
effect on the price and supply of shares. In certain situations, it may
become virtually impossible to sell a stock in an orderly fashion at a
price that approaches an estimate of its value.
POLITICAL DEVELOPMENTS. Political developments may adversely affect the
value of a Portfolio's foreign securities.
POLITICAL RISK. Some foreign governments have limited the outflow of
profits to investors abroad, extended diplomatic disputes to include trade
and financial relations, and have imposed high taxes on corporate profits.
REGULATORY RISK. Some foreign governments regulate their exchanges less
stringently, and the rights of shareholders may not be as firmly
established.
INTEREST RATE RISK. Fixed income securities are subject to the risk that
the securities could lose value because of interest rate changes. For example,
bonds tend to decrease in value if interest rates rise. Debt obligations with
longer maturities typically offer higher yields, but are subject to greater
price shifts as a result of interest rate changes than debt obligations with
shorter maturities.
LEVERAGING RISK. Certain transactions may give rise to a form of leverage.
Such transactions may include, among others, reverse repurchase agreements,
loans of portfolio securities, and the use of when-issued, delayed delivery or
forward commitment contracts. The use of derivatives may also create leveraging
risks. To mitigate leveraging risk, a sub-adviser can segregate liquid assets or
otherwise cover the transactions that may give rise to such risk. The use of
leverage may cause a Portfolio to liquidate portfolio positions when it may not
be advantageous to do so to satisfy its obligations or to meet segregation
requirements. Leverage, including borrowing, may cause a Portfolio to be more
volatile than if the Portfolio had not been leveraged. This is because
leveraging tends to exaggerate the effect of any increase or decrease in the
value of a Portfolio's securities.
LIQUIDITY RISK. Liquidity risk exists when particular investments are
difficult to purchase or sell. A Portfolio's investments in illiquid securities
may reduce the returns of the Portfolio because it may be unable to sell the
illiquid securities at an advantageous time or price. Portfolios with principal
investment strategies that involve foreign securities, derivatives or securities
with substantial market and/or credit risk tend to have the greatest exposure to
liquidity risk.
MANAGEMENT RISK. Each Portfolio is subject to management risk because it is
an actively managed investment portfolio. Each sub-adviser will apply investment
techniques and risk analyses in making investment decisions for the Portfolios,
but there can be no guarantee that these will produce the desired results.
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MARKET RISK. Common stocks and fixed income securities are subject to
market risk stemming from factors independent of any particular security.
Investment markets fluctuate. All markets go through cycles and market risk
involves being on the wrong side of a cycle. Factors affecting market risk
include political events, broad economic and social changes, and the mood of the
investing public. You can see market risk in action during large drops in the
stock market. If investor sentiment turns gloomy, the price of all stocks may
decline. It may not matter that a particular company has great profits and its
stock is selling at a relatively low price. If the overall market is dropping,
the values of all stocks are likely to drop. Generally, the stock prices of
large companies are more stable than the stock prices of smaller companies, but
this is not always the case. Smaller companies often offer a smaller range of
products and services than large companies. They may also have limited financial
resources and may lack management depth. As a result, stocks issued by smaller
companies may fluctuate in value more than the stocks of larger, more
established companies.
EVALUATING PERFORMANCE
The SP Jennison International Growth Portfolio and SP Strategic Partners Focused
Growth Portfolio are newly-created, and therefore do not have any performance
history.
HOW THE PORTFOLIOS INVEST
INVESTMENT OBJECTIVES AND POLICIES
We describe each Portfolio's investment objective and policies below. We
describe certain investment instruments that appear in bold lettering below in
the section entitled OTHER INVESTMENTS AND STRATEGIES. Although we make every
effort to achieve each Portfolio's objective, we can't guarantee success. The
Fund's Board of Directors can change a Portfolio's investment policy if that
policy is not fundamental.
An investment in a Portfolio is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
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SP JENNISON INTERNATIONAL GROWTH PORTFOLIO
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The investment objective of the Portfolio is to SEEK LONG-TERM GROWTH OF
CAPITAL. The Portfolio seeks to achieve its objective through investment in
equity-related securities of foreign companies.
----------------------------------- This means the Portfolio seeks
A FOREIGN STOCK GROWTH PORTFOLIO investments--primarily the common stock
The Portfolio seeks long-term of foreign companies--that will increase
growth by investing in the common in value over a period of years. A
stock of foreign companies. The company is considered to be a foreign
Portfolio generally invests in company if it satisfies at least one of
about 60 securities of issuers the following criteria: its securities
located in at least five different are traded principally on stock
foreign countries. exchanges in one or more foreign
----------------------------------- countries; it derives 50% or more of its
total revenue from goods produced, sales
made or services performed in one or
more foreign countries; it maintains 50%
or more of its assets in one or more
foreign countries; it is organized under
the laws of a foreign country; or its
principal executive office is located in
a foreign country.
The Portfolio invests in about 60 securities of primarily non U.S. growth
companies whose shares appear attractively valued on a relative and absolute
basis. The Portfolio looks for companies that have above-average actual and
potential earnings growth over the long term and strong financial and
operational characteristics. The Portfolio selects stocks on the basis of
individual company research. Thus, country, currency and industry weightings are
primarily the result of individual stock selections. Although the Portfolio may
invest in companies of all sizes, the Portfolio typically focuses on large and
medium sized companies. Under normal conditions, the Portfolio intends to invest
at least 65% of its total assets in the equity-related securities of foreign
companies in at least five foreign countries. The Portfolio may invest anywhere
in the world, including North America, Western Europe, the United Kingdom and
the Pacific Basin, but generally not the U.S.
The principal type of equity-related security in which the Portfolio invests is
common stock. In addition to common stock, the Portfolio may invest in other
equity-related securities that include, but are not limited to, preferred stock,
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rights that can be exercised to obtain stock, warrants and debt securities or
preferred stock convertible or exchangeable for common or preferred stock and
master limited partnerships. The Portfolio may also invest in AMERICAN
DEPOSITORY RECEIPTS (ADRS). We consider ADRs to be equity-related securities.
HOW THE PORTFOLIO INVESTS
In deciding which stocks to purchase for the Portfolio, Jennison looks for
growth companies that have both strong fundamentals and appear to be
attractively valued relative to their growth potential. Jennison uses a
bottom-up approach in selecting securities for the Portfolio, which means that
they select stocks based on individual company research, rather than allocating
by country or sector. In researching which stocks to buy, they look at a
company's basic financial and operational characteristics as well as compare the
company's stock price to the price of stocks of other companies that are its
competitors, absolute historic valuation levels for that company's stock, its
earnings growth and the price of existing portfolio holdings. Another important
part of Jennison's research process is to have regular contact with management
of the companies that they purchase in order to confirm earnings expectations
and to assess management's ability to meet its stated goals. Although the
Portfolio may invest in companies of all sizes, it typically focuses on large
and medium sized companies.
Generally, Jennison looks for companies that have one or more of the following
characteristics: actual and potential growth in earnings and cash flow; actual
and improving profitability; strong balance sheets; management strength; and
strong market share for the company's products.
In addition, Jennison looks for companies whose securities appear to be
attractively valued relative to: each company's peer group; absolute historic
valuations; and existing holdings of the Portfolio. Generally, they consider
selling a security when there is an identifiable change in a company's
fundamentals or when expectations of future earnings growth become fully
reflected in the price of that security.
OTHER INVESTMENTS AND STRATEGIES
MONEY MARKET INSTRUMENTS, BONDS AND OTHER FIXED-INCOME OBLIGATIONS
Money market instruments and bonds are known as fixed-income securities because
issuers of these securities are obligated to pay interest and principal.
Typically, FIXED-INCOME securities don't increase or decrease in value in
relation to an issuer's financial condition or business prospects as stocks may,
although their value does fluctuate inversely to changes in interest rates
generally and directly in relation to their perceived credit quality. The
Portfolio may buy obligations of companies, foreign countries or the U.S.
Government. Money market instruments include the commercial paper and short-term
obligations of foreign and domestic corporations, banks and governments and
their agencies.
Generally, the Portfolio will purchase only "Investment-Grade" commercial paper
and bonds. This means the commercial paper and bonds have received one of the
four highest quality ratings determined by Moody's Investors Service, Inc.
(Moody's), or Standard & Poor's Ratings Group (S&P), or one of the other
nationally recognized statistical rating organizations (NRSROs). Obligations
rated in the fourth category (Baa for Moody's or BBB for S&P) have speculative
characteristics and are subject to a greater risk of loss of principal and
interest. On occasion, the Portfolio may buy instruments that are not rated, but
that are of comparable quality to the investment-grade bonds described above.
TEMPORARY DEFENSIVE INVESTMENTS
In response to adverse market, economic or political conditions, the Portfolio
may temporarily invest up to 100% of its assets in money market instruments or
in the stock and other equity-related securities of U.S. companies. Investing
heavily in money market instruments limits the ability to achieve capital
appreciation, but may help to preserve the Portfolio's assets when global or
international markets are unstable. When the Portfolio is temporarily invested
in equity-related securities of U.S. companies, the Portfolio may achieve
capital appreciation, although not through investment in foreign companies.
REPURCHASE AGREEMENTS
The Portfolio may also use REPURCHASE AGREEMENTS.
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DERIVATIVE STRATEGIES
The Portfolio may use a number of alternative derivative strategies--including
derivatives--to try to improve its returns or protect its assets, although the
Portfolio cannot guarantee these strategies will work, that the instruments
necessary to implement these strategies will be available, or that the Portfolio
will not lose money.
OPTIONS
The Portfolio may purchase and sell put and call OPTIONS on equity securities,
stock indices and foreign currencies that are traded on U.S. or foreign
securities exchanges, on NASDAQ or in the over-the-counter market.
FUTURES CONTRACTS AND RELATED OPTIONS, FOREIGN CURRENCY FORWARD CONTRACTS. The
Portfolio may purchase and sell stock and bond index futures contracts and
related options on stock and bond index futures. The Portfolio also may purchase
and sell futures contracts on foreign currencies and related options on foreign
currency futures contracts.
OTHER STRATEGIES
The Portfolio follows certain policies when it borrows money (the Portfolio can
borrow up to 33-1/3% of the value of its total assets); lends its securities to
others (as an operating policy, which may be changed without stockholder
approval, the Portfolio will not lend more than 30% of the value of its total
assets, which for this purpose includes the value of any collateral received in
the transaction); and holds illiquid securities (the Portfolio may hold up to
15% of its net assets in illiquid securities, including restricted securities
with legal or contractual restrictions, those without a readily available market
and repurchase agreements with maturities longer than seven days).
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In pursuing its objective of LONG-TERM GROWTH OF CAPITAL, the Portfolio
normally invests at least 65% of its total assets in equity-related securities
of U.S. companies that are believed to have strong capital appreciation
potential.
----------------------------------- The Portfolio's strategy is to combine
A GROWTH STOCK PORTFOLIO the efforts of two investment advisers
The Portfolio normally invests at and to invest in the favorite stock
least 65% of its total assets in selection ideas of three portfolio
the equity-related securities of managers (two of whom invest as a team).
U.S. companies that are believed Each investment adviser to the Portfolio
to have strong capital appreciation utilizes a growth style to select
potential. The Portfolio is managed approximately 20 securities. The
according to a growth inestment portfolio managers build a portfolio
style. with stocks in which they have the
----------------------------------- highest confidence and may invest more
than 5% of the Portfolio's assets in any
one issuer.
The Portfolio may actively and frequently trade its portfolio securities. The
Portfolio is nondiversified, meaning it can invest more than 5% of its assets in
the securities of any one issuer. Investing in a nondiversified mutual fund,
particularly a fund investing in approximately 40 equity-related securities,
involves greater risk than investing in a diversified fund because a loss
resulting from the decline in the value of one security may represent a greater
portion of the total assets of a nondiversified fund.
The primary equity-related securities in which the Portfolio invests are common
stocks. Generally, each investment adviser will consider selling or reducing a
stock position when, in their opinion, the stock has experienced a fundamental
disappointment in earnings; it has reached an intermediate-term price objective
and its outlook no longer seems sufficiently promising; a relatively more
attractive stock emerges; or the stock has experienced adverse price movement. A
price decline of a stock does not necessarily mean that an investment adviser
will sell the stock at that time. During market declines, either investment
adviser may add to positions in favored stocks, which can result in a somewhat
more aggressive strategy, with a gradual reduction of the number of companies in
which the adviser invests. Conversely, in rising markets, either investment
adviser may reduce or eliminate fully valued positions, which can result in a
more conservative investment strategy, with a gradual increase in the number of
companies represented in the adviser's portfolio segment.
WE'RE GROWTH INVESTORS
In deciding which stocks to buy, each investment adviser uses what is known as a
growth investment style. This means that each adviser will invest in stocks they
believe could experience superior sales or earnings growth.
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In addition to common stocks in which the Portfolio primarily invests,
equity-related securities include nonconvertible preferred stocks; CONVERTIBLE
SECURITIES; American Depository Receipts (ADRS); warrants and rights that can be
exercised to obtain stock; investments in various types of business ventures,
including partnerships and joint ventures; real estate investment trusts
(REITS); and similar securities. Convertible securities are securities--like
bonds, corporate notes and preferred stocks--that can be converted into the
company's common stock or some other equity security.
The Portfolio may buy common stocks of companies of every size--small-,
medium-and large-capitalization-- although its investments are mostly in medium-
and large-capitalization stocks. The Portfolio intends to be fully invested,
holding less than 5% of its total assets in cash under normal market conditions.
DIVISION OF ASSETS
STRATEGY. Under normal conditions, there will be an approximately equal division
of the Portfolio's assets between the two investment advisers. All daily cash
inflows (that is, purchases and reinvested distributions) and outflows (that is,
redemptions and expense items) will usually be divided between the two
investment advisers as the portfolio manager deems appropriate. There will be a
periodic rebalancing of each segment's assets to take account of market
fluctuations in order to maintain the approximately equal allocation. As a
consequence, the manager may allocate assets from the portfolio segment that has
appreciated more to the other.
OUR GROWTH STYLE
Alliance Capital Management's portfolio manager, Alfred Harrison, utilizes the
fundamental analysis and research of Alliance's large internal research staff.
In selecting stocks for the Portfolio, he emphasizes stock selection and
investment in a limited number of companies that have strong management,
superior industry positions, excellent balance sheets and the ability to
demonstrate superior earnings growth.
Jennison Associates' portfolio managers, Spiros Segalas and Kathleen
McCarragher, invest in mid-size and large companies experiencing some or all of
the following: high sales growth, high unit growth, high or improving returns on
assets and equity and a strong balance sheet. These companies generally trade at
high prices relative to their current earnings.
RISKS. Reallocations may result in additional costs since sales of securities
may result in higher portfolio turnover. Also, because each investment adviser
selects portfolio securities independently, it is possible that a security held
by one portfolio segment may also be held by the other portfolio segment of the
Portfolio or that the two advisers may simultaneously favor the same industry.
PIFM will monitor the overall portfolio to ensure that any such overlaps do not
create an unintended industry concentration. In addition, if one investment
adviser buys a security as the other adviser sells it, the net position of the
Portfolio in the security may be approximately the same as it would have been
with a single portfolio and no such sale and purchase, but the Portfolio will
have incurred additional costs. The portfolio manager will consider these costs
in determining the allocation of assets. The portfolio manager will consider the
timing of reallocation based upon the best interests of the Portfolio and its
shareholders. To maintain the Portfolio's federal income tax status as a
regulated investment company, Jennison Associates also may have to sell
securities on a periodic basis.
OTHER INVESTMENTS AND STRATEGIES
In addition to its principal strategies, the Portfolio also uses the following
investment strategies to try to increase its returns or protect its assets if
market conditions warrant.
FOREIGN SECURITIES
The Portfolio may invest up to 20% of its total assets in FOREIGN SECURITIES,
including stocks and other equity-related securities, money market instruments
and other fixed-income securities of foreign issuers. The Portfolio does not
consider ADRs and other similar receipts or shares to be foreign securities.
MONEY MARKET INSTRUMENTS
The Portfolio may temporarily hold cash or invest in high-quality foreign or
domestic money market instruments pending investment of proceeds from new sales
of Portfolio shares or to meet ordinary daily cash needs subject to the policy
of normally investing at least 65% of the Portfolio's assets in equity-related
securities.
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REPURCHASE AGREEMENTS
The Portfolio may use REPURCHASE AGREEMENTS.
TEMPORARY DEFENSIVE INVESTMENTS
In response to adverse market, economic, political or other conditions, the
Portfolio may temporarily invest up to 100% of its assets in MONEY MARKET
INSTRUMENTS. Investing heavily in these securities limits the ability to achieve
the investment objective, but can help to preserve the Portfolio's assets when
the equity markets are unstable.
OPTIONS ON SECURITIES INDEXES.
The Portfolio may purchase and write (that is, sell) put and call options on
securities indexes that are traded on U.S. or foreign securities exchanges or in
the over-the-counter market to try to enhance return or to hedge the Portfolio's
portfolio. The Portfolio may write covered put and call options to generate
additional income through the receipt of premiums, purchase put options in an
effort to protect the value of a security that it owns against a decline in
market value and purchase call options in an effort to protect against an
increase in the price of securities it intends to purchase. The Portfolio also
may purchase put and call options to offset previously written put and call
options of the same series. The Portfolio will write only "covered" options. The
Portfolio may purchase and sell stock index futures contracts and related
options on stock index futures. The Portfolio may purchase and sell futures
contracts on foreign currencies and related options on foreign currency futures
contracts.
U.S. GOVERNMENT SECURITIES
The Portfolio may invest in securities issued or guaranteed by the U.S. Treasury
or by an agency or instrumentality of the U.S. government. Not all U.S.
government securities are backed by the full faith and credit of the United
States. Some are supported only by the credit of the issuing agency.
OPTIONS ON FUTURES CONTRACTS
The Portfolio will also enter into options on futures contracts for certain bona
fide hedging, return enhancement and risk management purposes. The Portfolio may
purchase put and call options and write (that is, sell) "covered" put and call
options on futures contracts that are traded on U.S. and foreign exchanges.
FUTURES CONTRACTS ON FOREIGN CURRENCIES AND OPTIONS THEREON
The Portfolio may buy and sell futures contracts on foreign currencies and
purchase and write options thereon.
SHORT SALES
The Portfolio may use SHORT SALES.
DERIVATIVE STRATEGIES
The Portfolio may use various DERIVATIVE STRATEGIES to try to improve the
Portfolio's returns. The Portfolio may use hedging techniques to try to protect
the Portfolio's assets. We cannot guarantee that these strategies will work,
that the instruments necessary to implement these strategies will be available,
or that the Portfolio will not lose money.
ADDITIONAL STRATEGIES
The Portfolio also follows certain policies when it BORROWS MONEY (the Portfolio
can borrow up to 33 1/3% of the value of its total assets); LENDS ITS SECURITIES
to others for cash management purposes (the Portfolio can lend up to 33 1/3% of
the value of its total assets including collateral received in the transaction);
and HOLDS ILLIQUID SECURITIES (the Portfolio may hold up to 15% of its net
assets in illiquid securities, including securities with legal or contractual
restrictions on resale, those without a readily available market and repurchase
agreements with maturities longer than seven days). The Portfolio is subject to
certain investment restrictions that are fundamental policies, which means they
cannot be changed without shareholder approval. For more information about these
restrictions, see the SAI.
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PORTFOLIO TURNOVER
It is not a principal strategy of the Portfolio to actively and frequently trade
its portfolio securities to achieve its investment objective. Nevertheless, the
Portfolio may have an annual portfolio turnover rate of up to 200%. Portfolio
turnover is generally the percentage found by dividing the lesser of portfolio
purchases and sales by the monthly average value of the portfolio. High
portfolio turnover (100% or more) results in higher brokerage commissions and
other costs and can affect the Portfolio's performance.
* * *
OTHER INVESTMENTS AND STRATEGIES
As indicated in the description of the Portfolios above, certain Portfolios may
use the following investment strategies to increase return or protect assets if
market conditions warrant.
ADRS--are certificates representing the right to receive foreign securities that
have been deposited with a U.S. bank or a foreign branch of a U.S. bank.
CONVERTIBLE DEBT AND CONVERTIBLE PREFERRED STOCK--A convertible security is a
security--for example, a bond or preferred stock--that may be converted into
common stock of the same or different issuer. The convertible security sets the
price, quantity of shares and time period in which it may be so converted.
Convertible stock is senior to a company's common stock but is usually
subordinated to debt obligations of the company. Convertible securities provide
a steady stream of income which is generally at a higher rate than the income on
the company's common stock but lower than the rate on the company's debt
obligations. At the same time, they offer--through their conversion
mechanism--the chance to participate in the capital appreciation of the
underlying common stock. The price of a convertible security tends to increase
and decrease with the market value of the underlying common stock.
DERIVATIVES--A derivative is an investment instrument that derives its price,
performance, value, or cash flow from one or more underlying securities or other
interests. Derivatives involve costs and can be volatile. With derivatives, the
investment adviser tries to predict whether the underlying investment--a
security, market index, currency, interest rate or some other benchmark--will go
up or down at some future date. We may use derivatives to try to reduce risk or
to increase return consistent with a Portfolio's overall investment objective.
The investment adviser will consider other factors (such as cost) in deciding
whether to employ any particular strategy, or use any particular instrument. Any
derivatives we use may not fully offset a Portfolio's underlying positions and
this could result in losses to the Portfolio that would not otherwise have
occurred.
DOLLAR ROLLS--Dollar rolls involve the sale by the Portfolio of a security for
delivery in the current month with a promise to repurchase from the buyer a
substantially similar--but not necessarily the same--security at a set price and
date in the future. During the "roll period," the Portfolio does not receive any
principal or interest on the security. Instead, it is compensated by the
difference between the current sales price and the price of the future purchase,
as well as any interest earned on the cash proceeds from the original sale.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS--A foreign currency forward contract
is an obligation to buy or sell a given currency on a future date at a set
price. When a Portfolio enters into a contract for the purchase or sale of a
security denominated in a foreign currency, or when a Portfolio anticipates the
receipt in a foreign currency of dividends or interest payments on a security
which it holds, the Portfolio may desire to "lock-in" the U.S. dollar price of
the security or the U.S. dollar equivalent of such dividend or interest payment,
as the case may be. By entering into a forward contract for a fixed amount of
dollars, for the purchase or sale of the amount of foreign currency involved in
the underlying transactions, the Portfolio will be able to protect itself
against a possible loss resulting from an adverse change in the relationship
between the U.S. dollar and the foreign currency during the period between the
date on which the security is purchased or sold, or on which the dividend or
interest payment is declared, and the date on which such payments are made or
received. At the maturity of a forward contract, a Portfolio may either sell the
security and make delivery of the foreign currency or it may retain the security
and terminate its contractual obligation to deliver the foreign currency by
purchasing an "offsetting" contract with the same currency trader obligating it
to purchase, on the same maturity date, the same amount of the foreign currency.
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FUTURES--A futures contract is an agreement to buy or sell a set quantity of an
underlying product at a future date, or to make or receive a cash payment based
on the value of a securities index. When a futures contract is entered into,
each party deposits with a futures commission merchant (or in a segregated
account) approximately 5% of the contract amount. This is known as the "initial
margin." Every day during the futures contract, either the buyer or the futures
commission merchant will make payments of "variation margin." In other words, if
the value of the underlying security, index or interest rate increases, then the
buyer will have to add to the margin account so that the account balance equals
approximately 5% of the value of the contract on that day. The next day, the
value of the underlying security, index or interest rate may decrease, in which
case the borrower would receive money from the account equal to the amount by
which the account balance exceeds 5% of the value of the contract on that day. A
stock index futures contract is an agreement between the buyer and the seller of
the contract to transfer an amount of cash equal to the daily variation margin
of the contract. No physical delivery of the underlying stocks in the index is
made.
INTEREST RATE SWAPS--In an interest rate swap, the Portfolio and another party
agree to exchange interest payments. For example, the Portfolio may wish to
exchange a floating rate of interest for a fixed rate. We would enter into that
type of a swap if we think interest rates are going down.
JOINT REPURCHASE ACCOUNT--In a joint repurchase transaction, uninvested cash
balances of various Portfolios are added together and invested in one or more
repurchase agreements. Each of the participating Portfolios receives a portion
of the income earned in the joint account based on the percentage of its
investment.
LOAN PARTICIPATIONS--In loan participations, the Portfolio will have a
contractual relationship with the lender but not with the borrower. This means
the Portfolio will only have rights to principal and interest received by the
lender. It will not be able to enforce compliance by the borrower with the terms
of the loan and may not have a right to any collateral securing the loan. If the
lender becomes insolvent, the Portfolio may be treated as a general creditor and
will not benefit from any set-off between the lender and the borrower.
MORTGAGE-RELATED SECURITIES are usually pass-through instruments that pay
investors a share of all interest and principal payments from an underlying pool
of fixed or adjustable rate mortgages. We may invest in mortgage-related
securities issued and guaranteed by the U.S. government or its agencies like the
Federal National Mortgage Association (Fannie Maes) and the Government National
Mortgage Association (Ginnie Maes) and debt securities issued (but not
guaranteed) by the Federal Home Loan Mortgage Company (Freddie Macs). Private
mortgage-related securities that are not guaranteed by U.S. governmental
entities generally have one or more types of credit enhancement to ensure timely
receipt of payments and to protect against default.
Mortgage-related securities include collateralized mortgage obligations,
multi-class pass through securities and stripped mortgage-backed securities. A
collateralized mortgage-backed obligation (CMO) is a security backed by an
underlying portfolio of mortgages or mortgage-backed securities that may be
issued or guaranteed by entities such as banks, U.S. governmental entities or
broker-dealers. A multi-class pass-through security is an equity interest in a
trust composed of underlying mortgage assets. Payments of principal and interest
on the mortgage assets and any reinvestment income provide the money to pay debt
service on the CMO or to make scheduled distributions on the multi-class
pass-through security. A stripped mortgage-backed security (MBS strip) may be
issued by U.S. governmental entities or by private institutions. MBS strips take
the pieces of a debt security (principal and interest) and break them apart. The
resulting securities may be sold separately and may perform differently. MBS
strips are highly sensitive to changes in prepayment and interest rates.
OPTIONS--A call option on stock is a short-term contract that gives the option
purchaser or "holder" the right to acquire a particular equity security for a
specified price at any time during a specified period. For this right, the
option purchaser pays the option seller a certain amount of money or "premium"
which is set before the option contract is entered into. The seller or "writer"
of the option is obligated to deliver the particular security if the option
purchaser exercises the option. A put option on stock is a similar contract. In
a put option, the option purchaser has the right to sell a particular security
to the option seller for a specified price at any time during a specified
period. In exchange for this right, the option purchaser pays the option seller
a premium. Options on debt securities are similar to stock options except that
the option holder has the right to acquire or sell a debt security rather than
an equity security. Options on stock indexes are similar to options on stocks,
except that instead of giving the option holder the right to receive or sell a
stock, it gives the holder the right to receive an amount of cash if the closing
level of the stock index is greater than (in the case of a call) or less than
(in the case of a put) the exercise price of the option. The amount of cash the
holder will receive is determined by multiplying the difference between the
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index's closing price and the option's exercise price, expressed in dollars, by
a specified "multiplier". Unlike stock options, stock index options are always
settled in cash, and gain or loss depends on price movements in the stock market
generally (or a particular market segment, depending on the index) rather than
the price movement of an individual stock.
REAL ESTATE INVESTMENT TRUSTS (REITS)--A REIT is a company that manages a
portfolio of real estate to earn profits for its shareholders. Some REITs
acquire equity interests in real estate and then receive income from rents and
capital gains when the buildings are sold. Other REITs lend money to real estate
developers and receive interest income from the mortgages.
Some REITs invest in both types of interests.
REPURCHASE AGREEMENTS--In a repurchase transaction, the Portfolio agrees to
purchase certain securities and the seller agrees to repurchase the same
securities at an agreed upon price on a specified date. This creates a fixed
return for the Portfolio.
REVERSE REPURCHASE AGREEMENTS--In a reverse repurchase transaction, the
Portfolio sells a security it owns and agrees to buy it back at a set price and
date. During the period the security is held by the other party, the Portfolio
may continue to receive principal and interest payments on the security.
SHORT SALES--In a short sale, we sell a security we do not own to take advantage
of an anticipated decline in the stock's price. The Portfolio borrows the stock
for delivery and if it can buy the stock later at a lower price, a profit
results.
SHORT SALES AGAINST-THE-BOX--A short sale against-the-box means the Portfolio
owns securities identical to those sold short.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES--With when-issued or delayed
delivery securities, the delivery and payment can take place a month or more
after the date of the transaction. A Portfolio will make commitments for
when-issued transactions only with the intention of actually acquiring the
securities. A Portfolio's custodian will maintain in a segregated account,
liquid assets having a value equal to or greater than such commitments. If the
Portfolio chooses to dispose of the right to acquire a when-issued security
prior to its acquisition, it could, as with the disposition of any other
security, incur a gain or loss.
* * *
HOW THE FUND IS MANAGED
BOARD OF DIRECTORS
The Board of Directors oversees the actions of the investment manager and the
sub-advisers and decides on general policies. The Board also oversees the Fund's
officers who conduct and supervise the daily business operations of the Fund.
INVESTMENT MANAGER
Prudential Investments Fund Management LLC (PIFM) serves as overall investment
manager for all of the "SP" Portfolios. Prudential Investments Fund Management
LLC, located at 100 Mulberry Street, Newark, NJ is the investment adviser to the
SP Jennison International Growth Portfolio and SP Strategic Partners Focused
Growth Portfolio.
PIFM is responsible for selecting and monitoring one or more sub-advisors to
handle the day-to-day investment management of the Portfolio. For Portfolios
with more than one sub-adviser, PIFM is responsible for allocating assets among
the sub-advisers. PIFM, not the Portfolios, pay the fees of the sub-advisers.
Pursuant to an order issued by the SEC, each of these Portfolios may add or
change sub-advisers, or change the agreement with its sub-advisers, if PIFM and
the Board of Directors concludes that doing so is in the best interests of
contract owners investing in the Portfolio. The Portfolios can make these
changes without contract owner approval, but will notify contract owners
investing in the Portfolio of any such changes.
The following chart lists the total annualized investment advisory fees to be
paid in 2000 with respect to each of the Fund's Portfolios offered through this
prospectus.
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--------------------------------------------------------------------------------
TOTAL ADVISORY FEES AS %
PORTFOLIO OF AVERAGE NET ASSETS
--------------------------------------------------------------------------------
SP Jennison International Growth Portfolio 0.85
SP Strategic Partners Focused Growth Portfolio 0.90
INVESTMENT SUB-ADVISERS
JENNISON ASSOCIATES LLC, a Prudential subsidiary, serves as subadviser to the SP
Jennison International Growth Portfolio and the SP Strategic Partners Focused
Growth Portfolio. Jennison's address is 466 Lexington Avenue, New York, NY, and
as of December 31, 1999, it had over $59 billion of assets under management.
--------------------------------------------------------------------------------
PORTFOLIO MANAGERS
--------------------------------------------------------------------------------
We set out below descriptions of the portfolio managers and for certain
Portfolios, the past performance of a similarly-managed mutual fund. THOSE
PERFORMANCE FIGURES DO NOT REFLECT VARIABLE INSURANCE CONTRACT FEES WHICH, IF
DEDUCTED, WOULD REDUCE PERFORMANCE. MOREOVER, AS DISCLOSED IN THE PROSPECTUS FOR
YOUR VARIABLE INSURANCE CONTRACT, THE SP PORTFOLIOS OF THE FUND ARE SUBJECT TO
EXPENSE LIMITATIONS WHICH, IF TERMINATED, WOULD INCREASE EXPENSES AND BE A
FACTOR IN LOWERING PERFORMANCE.
SP JENNISON INTERNATIONAL GROWTH PORTFOLIO
The Portfolio is co-managed by Howard Moss and Blair Boyer. Mr. Moss and Mr.
Boyer have worked together managing international equity portfolios since 1989.
Howard Moss has been an Executive Vice President and Director of Jennison since
1993. Mr. Moss has been in the investment business for 30 years. Mr. Moss
received a B.A. from the University of Liverpool. Blair Boyer is an Executive
Vice President and Director of Jennison and has been with Jennison since 1993.
Mr. Boyer received a B.A. from Bucknell University and an M.B.A. from New York
University.
SP STRATEGIC PARTNERS FOCUSED GROWTH PORTFOLIO
Alfred Harrison is portfolio manager for the portion of the Portfolio's assets
advised by Alliance. Mr. Harrison joined Alliance in 1978 and is manager of the
firm's Minneapolis office. He is Vice Chairman of Alliance Capital Management
Corporation.
Spiros Segalas and Kathleen McCarragher are co-portfolio managers for the
portion of the Portfolio's assets advised by Jennison. Mr. Segalas is a founding
member and President, Director, and Chief Investment Officer of Jennison. He has
been in the investment business for over 35 years. Mr. Segalas received a B.A.
from Princeton University and is a member of the New York Society of Security
Analysts. Ms. McCarragher, Director and Executive Vice President of Jennison, is
also Jennison's Growth Equity Investment Strategist, having joined Jennison in
1998 after a 17 year investment career, including positions with Weiss, Peck &
Greer and State Street Research and Management Company where she was a member of
the Investment Committee. She received B.B.A. from the University of Wisconsin
and an M.B.A. from Harvard Business School.
HOW TO BUY AND SELL SHARES OF THE FUND
The Fund offers two classes of shares in each Portfolio - Class I and Class II.
Each Class participates in the same investments within a given Portfolio, but
the Classes differ as far as their charges. Class I shares are sold only to
separate accounts of Prudential as investment options under certain Contracts.
Class II is offered only to separate accounts of non-Prudential insurance
companies as investment options under certain of their Contracts. This
prospectus covers only Class II shares, which are available under variable
contracts issued by Allianz Life and its affiliates.
Together with this prospectus, you should have received a prospectus for the
variable contract. You should refer to that prospectus for further information
on investing in the Portfolios.
Shares of a Portfolio are sold without any sales charge at the net asset value
of the Portfolio.
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Shares are redeemed for cash within seven days of receipt of a proper notice of
redemption or sooner if required by law. There is no redemption charge. We may
suspend the right to redeem shares or receive payment when the New York Stock
Exchange is closed (other than weekends or holidays), when trading on the New
York Stock Exchange is restricted, or as permitted by the SEC.
NET ASSET VALUE
Any purchase or sale of Portfolio shares is made at the net asset value, or NAV,
of such shares. The price at which a purchase or redemption is made is based on
the next calculation of the NAV after the order is received in good order. The
NAV of each share class of each Portfolio is determined once a day--at 4:00 p.m.
New York time--on each day the New York Stock Exchange is open for business. If
the New York Stock Exchange closes early on a day, the Portfolios' NAVs will be
calculated some time between the closing time and 4:00 p.m. on that day.
The NAV for each of the Portfolios is determined by a simple calculation. It's
the total value of a Portfolio (assets minus liabilities) divided by the total
number of shares outstanding.
To determine a Portfolio's NAV, its holdings are valued as follows:
EQUITY SECURITIES are generally valued at the last sale price on an exchange or
NASDAQ, or if there is not a sale on that day, at the mean between the most
recent bid and asked prices on that day. If there is no asked price, the
security will be valued at the bid price. Equity securities that are not sold on
an exchange or NASDAQ are generally valued by an independent pricing agent or
principal market maker.
A Portfolio may own securities that are primarily listed on foreign exchanges
that trade on weekends or other days when the Portfolios do not price their
shares. Therefore, the value of a Portfolio's assets may change on days when
shareholders cannot purchase or redeem Portfolio shares.
SHORT-TERM DEBT SECURITIES generally are valued at amortized cost. The amortized
cost valuation method is widely used by mutual funds. It means that the security
is valued initially at its purchase price and then decreases in value by equal
amounts each day until the security matures. It almost always results in a value
that is extremely close to the actual market value.
Short-term debt securities, including bonds, notes, debentures and other debt
securities, and money market instruments such as certificates of deposit,
commercial paper, bankers' acceptances and obligations of domestic and foreign
banks, with remaining maturities of more than 60 days, for which market
quotations are readily available, are valued by an independent pricing agent or
principal market maker (if available, otherwise a primary market dealer).
CONVERTIBLE DEBT SECURITIES that are traded in the over-the-counter market,
including listed convertible debt securities for which the primary market is
believed by PIFM or a sub-adviser to be over-the-counter, are valued at the mean
between the last bid and asked prices provided by a principal market maker (if
available, otherwise a primary market dealer).
OTHER DEBT SECURITIES--those that are not valued on an amortized cost basis--are
valued using an independent pricing service.
OPTIONS ON STOCK AND STOCK INDEXES that are traded on a national securities
exchange are valued at the last sale price on such exchange on the day of
valuation or, if there was no such sale on such day, at the mean between the
most recently quoted bid and asked prices on such exchange.
FUTURES CONTRACTS and OPTIONS ON FUTURES CONTRACTS are valued at the last sale
price at the close of the commodities exchange or board of trade on which they
are traded. If there has been no sale that day, the securities will be valued at
the mean between the most recently quoted bid and asked prices on that exchange
or board of trade.
FORWARD CURRENCY EXCHANGE CONTRACTS are valued at the cost of covering or
offsetting such contracts calculated on the day of valuation. Securities which
are valued in accordance herewith in a currency other than U.S. dollars shall be
converted to U.S. dollar equivalents at a rate obtained from a recognized bank,
dealer or independent service on the day of valuation.
OVER-THE-COUNTER (OTC) OPTIONS are valued at the mean between bid and asked
prices provided by a dealer (which may be the counterparty). The sub-adviser
will monitor the market prices of the securities underlying the
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OTC options with a view to determining the necessity of obtaining additional bid
and asked quotations from other dealers to assess the validity of the prices
received from the primary pricing dealer.
SECURITIES FOR WHICH NO MARKET QUOTATIONS ARE AVAILABLE will be valued at fair
value under the direction of the Fund's Board of Directors.
DISTRIBUTOR
Prudential Investment Management Services LLC (PIMS) distributes the Fund's
shares under a Distribution Agreement with the Fund. PIMS' principal business
address is 751 Broad Street, Newark, New Jersey 07102-3777.
OTHER INFORMATION
FEDERAL INCOME TAXES
If you own or are considering purchasing a Allianz variable annuity contract,
you should consult the prospectus for that contract for tax information. You
should also consult with a qualified tax adviser for information and advice.
The SAI provides information about certain tax laws applicable to the Fund.
EUROPEAN MONETARY UNION
On January 1, 1999, 11 of the 15 member states of the European Monetary Union
introduced the "euro" as a common currency. During a three-year transitional
period, the euro will coexist with each participating state's currency and, on
July 1, 2002, the euro is expected to become the sole currency of the
participating states. During the transition period, the Fund will treat the euro
as a separate currency from that of any participating state. The conversion may
adversely affect the Fund if the euro does not take effect as planned; if a
participating state withdraws from the European Monetary Union; or if the
computing, accounting and trading systems used by the Fund's service providers,
or by entities with which the Fund or its service providers do business, are not
capable of recognizing the euro as a distinct currency at the time of, and
following, euro conversion. In addition, the conversion could cause markets to
become more volatile.
MONITORING FOR POSSIBLE CONFLICTS
The Fund sells its shares to fund variable life insurance contracts and variable
annuity contracts and is authorized to offer its shares to qualified retirement
plans. Because of differences in tax treatment and other considerations, it is
possible that the interest of variable life insurance contract owners, variable
annuity contract owners and participants in qualified retirement plans could
conflict. The Fund will monitor the situation and in the event that a material
conflict did develop, the Fund would determine what action, if any, to take in
response.
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For More Information
Additional information about the Fund and each Portfolio can be obtained upon
request without charge and can be found in the following documents:
Statement of Additional Information (SAI)
(incorporated by reference into this prospectus)
Annual Report
(including a discussion of market conditions and strategies that significantly
affected the Portfolios' performance during the previous year)
Semi-Annual Report
To obtain these documents or to ask any questions about the Fund:
Call toll-free (800) 778-2255
Write to The Prudential Series Fund, Inc.,
751 BROAD STREET, NEWARK, NJ 07102-3777
You can also obtain copies of Fund documents from the Securities and Exchange
Commission as follows:
BY MAIL:
Securities and Exchange Commission
Public Reference Section
Washington, DC 20549-0102
BY ELECTRONIC REQUEST:
[email protected]
(The SEC charges a fee to copy documents.)
IN PERSON:
Public Reference Room
in Washington, DC
(For hours of operation, call 1-202-942-8090)
VIA THE INTERNET:
on the EDGAR Database at
http://www.sec.gov
SEC File No. 811-03623
