SEMI ANNUAL REPORT April 30, 1995
Prudential
Short-Term
Global Income
Fund, Inc.
(ICON)
Global Assets
Portfolio
(LOGO)
<PAGE>
Letter to Shareholders
June 9, 1995
Dear Shareholder:
Although the U.S. dollar showed continued weakness through much of the
first quarter of 1995, global bond markets began to recover from their dismal
performance in 1994. Given this environment, we are pleased to report that
the Prudential Short-Term Global Income Fund/Global Assets Portfolio produced
returns exceeding those of the Lipper Short-Term World Multi-Market Average
for the six months ending April 30, 1995.
Fund Performance.
The Global Assets Portfolio began the reporting period with an NAV of $1.80 and
ended it with an NAV of $1.79.
CUMULATIVE TOTAL RETURNS1
<TABLE>
<CAPTION>
As of 4/30/95
6 Mos. One Year Since Inception2
<S> <C> <C> <C>
Class A* 1.8% 1.5% 14.7%
Lipper ST World -1.2% -0.5% 3.5%
Fund Average3
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS1
As of 3/31/95
One Year Since Inception2
<S> <C> <C>
Class A 0.5% 2.9%
</TABLE>
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
1 Source: Prudential Mutual Fund Management Inc. and Lipper Analytical Services,
Inc. Cumulative
total returns do not take into account sales charges. The
average annual returns do take into account applicable sales
charges. The Fund charges a maximum front-end sales load of
0.99% for Class A shares.
2 Inception of Class A shares 2/15/91.
3 This figure is the average of 44 funds in the Short-Term World
Multi-Market Average for six-months; 40 funds for one year; and
14 funds since inception for the period ending April 30, 1995, as
measured by Lipper Analytical Services, Inc.
* Class B shares are no longer offered and ceased operations on May 9, 1994.
-1-
<PAGE>
The Fund's Objective.
The Prudential Short-Term Global Income Fund/Global Assets Portfolio
seeks high current income with minimum risk to principal by investing in a
portfolio of high-quality debt securities having remaining maturities of not
more than one year. The Fund also seeks high current yields by investing in
debt securities denominated in the U.S. dollar and a range of foreign
currencies. There can be no assurance that the Fund's investment
objective will be achieved.
The Global Assets Portfolio is non-diversified, meaning it may invest more
than 5% of its total assets in securities of one or more issuers. Investment
in a non-diversified fund carries greater risk than investment in a
diversified portfolio.
A Global View of World Markets.
Bond markets are beginning to recover from 1994's poor showing. For the
four-month period ending on April 30, 1995, the Lipper Short-Term World
Multi-Market Average posted a gain of 1.4%. Performance was generally
positive across the board in local currency terms and was further bolstered
by currency performance.
Investor perception has clearly changed with signs that the U.S. economy
is indeed slowing and responding to the aggressive interest rate policy of
the U.S. Federal Reserve. Fewer housing starts, sluggish car sales,
higher unemployment numbers and other signs pointed to a so-called "soft
landing" for the U.S. economy and not the recession as some had feared.
The U.S. dollar took center stage for much of the reporting period, especially
during March. Failure to pass a balanced budget amendment in Congress
coupled with slim prospects for higher U.S. interest rates served to undermine
confidence in the U.S. currency. The German central bank responded by cutting
its discount rate by 50 basis points and the Japanese followed suit by reducing
their money rate by the same amount. The result: the German mark rose 6% and
the Japanese yen a stunning 10% against the U.S. dollar.
What We Did.
Your Fund held a strong bias toward hard currencies in Europe, such as
the German mark or Swiss franc, as strains within the European currency
mechanism developed. During the reporting period the Spanish peseta and
Portuguese escudo were devalued against the mark. This resulted in a premium
being attached to core currency holdings with stronger fundamentals (e.g.
marks or francs). Conversely, peripheral markets, such as Sweden, Italy and
Spain had additional risk assigned to their currencies. Although these three
-2-
nations offer some of the highest yielding issues in Europe and have made up
some of the lost ground from earlier in the year, they remain highly
volatile environments and we are avoiding them.
The Fund's bond holdings were heavily invested in core bond markets, which
tended to perform better on the basis of currency strength and a "flight to
quality" by many investors. For instance, we were drawn to Canada and
New Zealand where significant central bank/tightening and undervalued
currencies made investments especially attractive. Attractive
yields, a proactive British central bank plus a strong currency
also drew us to bonds from the United Kingdom.
The Outlook.
There are indications that the current global bond rally may have
run its course. Nevertheless foreign markets will remain an
attractive investment choice for U.S. investors, because they
offer the potential for better long-term performance and add an
element of diversification to most portfolios.
Please understand that there are special risks involved with foreign
investing. Foreign securities are not guaranteed and may be influenced
by currency fluctuations, political and social developments. These
risks are described fully in the Fund prospectus.
For further insight into what may be in store for global markets, we
invite you to read the following "Portfolio Q & A" feature with new
portfolio managers Simon Wells and Gabriel Irwin.
As always, it is a pleasure to have you as a shareholder of the Prudential
Short-Term Global Income Fund/Global Assets Portfolio, where we
are committed to managing the Fund for your benefit.
Sincerely,
Simon Wells Gabriel Irwin
Portfolio Manager Portfolio Manager
Richard A. Redeker
President
-3-
PORTFOLIO Q&A
We are proud to announce that Simon Wells and
Gabriel Irwin have joined Prudential Mutual Funds. They will be
managing the Prudential Short-Term Global Income Fund/Global
Assets Portfolio. We talked to them about their outlook for the
global bond markets in 1995.
Q. Why have global bonds performed so well this year? How long can it last?
A. You have to view the first quarter rally in the context of what happened
in 1994. Last year was not good for bonds anywhere in the world. By year-end,
short-term investors had been frightened out of the market and portfolio
maturities were generally low. A number of market participants had shortened
maturities expecting rising interest rates. So when interest rates started
falling, they were forced to buy longer term bonds, which in turn has fueled
bond price increases. Such is life in the investment world. Our belief is
that there isn't much steam left in this rally, because although world
inflation is low, we are in an economic upturn usually the most bullish
environment for bonds.
Q. Why not just buy U.S. bonds and avoid foreign risk altogether?
A. Foreign bonds do not necessarily follow the U.S. market. One of the
attractions of the foreign bond market for risk-tolerant U.S. investors is
that there are almost invariably better return opportunities in a number
of foreign countries. Since the 1970s, the U.S. has been the best-performing
market in only one year -- 1984. This year alone, the Japanese bond market has
returned nearly 25%
to U.S. investors. Also, there is always a strong case for adding foreign bonds
to a domestic portfolio for purposes of diversification.
-4-
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC. Portfolio of Investments
GLOBAL ASSETS PORTFOLIO April 30, 1995 (Unaudited)
<TABLE>
<CAPTION>
Principal US$
Amount Value
(000) Description (Note 1)
<C> <S> <C>
Australia--8.6%
Australian Government
Treasury Notes,*
A$ 3,900 8.60%, 5/24/95........... $ 2,821,325
-----------
Canada--11.8%
Canadian Treasury Bills,*
C$ 1,960 8.16%, 6/22/95........... 1,423,584
1,000 7.88%, 6/29/95........... 725,393
1,350 8.37%, 8/3/95............ 972,101
1,000 6.88%, 8/10/95........... 718,956
-----------
3,840,034
-----------
New Zealand--14.2%
New Zealand Treasury
Bills,*
NZ$ 7,000 9.65%, 7/5/95............ 4,636,427
-----------
United Kingdom--4.9%
United Kingdom, C.D.,
BP 1,000 7.59%, 12/15/95.......... 1,612,210
-----------
United States--61.6%
Joint Repurchase
Agreement Account,
5.93%, 5/1/95, (Note
US$ 760 5)..................... $ 760,000
United States Treasury
Bills,*
18,500 5.83%, 5/25/95........... 18,425,699
1,000 6.36%, 8/10/95........... 983,620
-----------
20,169,319
-----------
Total Investments--101.1%
(cost US$32,879,834; Note
4)..................... 33,079,315
Liabilities in excess of
other
assets--(1.1%)........... (352,816)
-----------
Net Assets--100%......... $32,726,499
-----------
-----------
</TABLE>
- ------------------
Portfolio securities are classified by country according to the
security's currency denomination.
C.D.--Certificates of Deposit.
* Percentage quoted represents yield to maturity as of purchase date.
-5- See Notes to Financial Statements.
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Assets and Liabilities
(Unaudited)
<TABLE>
<CAPTION>
Assets
April 30, 1995
--------------
<S>
<C>
Investments, at value (cost
$32,879,834).................................................. $ 33,079,315
Cash.........................................................................
............. 42,209
Foreign currency, at value (cost
$1,577).................................................. 1,704
Receivable for Fund shares
sold........................................................... 893,924
Forward currency contracts--net amount receivable from
counterparties..................... 815,697
Interest
receivable...................................................................
.... 46,308
Deferred expenses and other
assets........................................................ 13,159
--------------
Total
assets.......................................................................
..... 34,892,316
--------------
Liabilities
Payable for Fund shares
reacquired........................................................
1,010,348
Forward currency contracts--net amount payable to
counterparties.......................... 960,661
Accrued
expenses.....................................................................
..... 122,892
Dividends
payable.........................................................................
42,087
Management fee
payable....................................................................
15,625
Distribution fee
payable..................................................................
14,204
--------------
Total
liabilities..................................................................
..... 2,165,817
--------------
Net
Assets.......................................................................
......... $ 32,726,499
--------------
--------------
Net assets were comprised of:
Common stock, at
par.................................................................... $
18,311
Paid-in capital in excess of
par........................................................ 48,662,533
--------------
48,680,844
Accumulated distribution in excess of net investment
income............................. (5,072,919)
Accumulated net realized loss on
investments............................................ (10,936,814)
Net unrealized appreciation on investments and foreign
currencies....................... 55,388
--------------
Net assets, April 30,
1995................................................................ $
32,726,499
--------------
--------------
Class A:
Net asset value and redemption price per share ($32,726,499 / 18,310,543
shares of
common stock
issued and
outstanding)...............................................................
$1.79
Maximum sales charge (.99% of offering
price)........................................... .02
--------------
Maximum offering price to
public........................................................ $1.81
--------------
--------------
</TABLE>
See Notes to Financial Statements.
-6-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
Six Months
Ended
Net Investment Income April 30, 1995
--------------
<S> <C>
Income
Interest........................... $ 1,482,747
--------------
Expenses
Management fee..................... 111,146
Distribution fee--Class A.......... 101,042
Custodian's fees and expenses...... 115,000
Transfer agent's fees and
expenses........................... 29,000
Reports to shareholders............ 18,000
Directors' fees.................... 17,500
Legal fees......................... 14,000
Audit fee.......................... 12,500
Registration fees.................. 10,000
Amortization of organization
expenses........................... 6,000
Miscellaneous...................... 2,359
--------------
Total expenses................... 436,547
--------------
Net investment income................ 1,046,200
--------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign
Currency Transactions
Net realized loss on:
Investment transactions............ (352,728)
Foreign currency transactions...... (188,157)
Written option transactions........ (116,184)
--------------
(657,069)
--------------
Net change in unrealized
appreciation/ depreciation of:
Investments........................ 285,612
Foreign currencies................. (156,764)
--------------
128,848
--------------
Net loss on investments, foreign
currencies and written options..... (528,221)
--------------
Net Increase in Net Assets
Resulting from Operations............ $ 517,979
--------------
--------------
</TABLE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Changes in Net Assets
(Unaudited)
<TABLE>
<CAPTION>
Six Months Year
Net Increase (Decrease) Ended Ended
in Net Assets April 30, 1995 October 31, 1994
-------------- ----------------
<S> <C> <C>
Operations
Net investment income... $ 1,046,200 $ 3,377,861
Net realized loss on
investments and
foreign currency
transactions.......... (657,069) (3,538,581)
Net change in unrealized
appreciation/depreciation
of investments and
foreign currencies.... 128,848 540,308
-------------- ----------------
Net increase in net
assets resulting from
operations............ 517,979 379,588
-------------- ----------------
Contingent deferred sales
charges collected....... -- 8,161
-------------- ----------------
Dividends and
distributions
(Note 1)
Dividends from net
investment income
Class A............... (451,861) --
-------------- ----------------
Dividends in excess of
net investment income
Class A............... (497,874) (117,091)
Class B............... -- (411)
-------------- ----------------
(497,874) (117,502)
-------------- ----------------
Tax return of capital
distributions
Class A............... -- (3,826,815)
Class B............... -- (13,439)
-------------- ----------------
-- (3,840,254)
-------------- ----------------
Fund share transactions
(Note 6)
Net proceeds from shares
subscribed............ 1,136,130 4,822,020
Net asset value of
shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 703,121 2,685,643
Cost of shares
reacquired.............. (19,218,376) (82,912,800)
-------------- ----------------
Net decrease in net
assets from Fund share
transactions.......... (17,379,125) (75,405,137)
-------------- ----------------
Total decrease............ (17,810,881) (78,975,144)
Net Assets
Beginning of period....... 50,537,380 129,512,524
-------------- ----------------
End of period............. $ 32,726,499 $ 50,537,380
-------------- ----------------
-------------- ----------------
</TABLE>
See Notes to Financial Statements. See Notes to Financial Statements.
-7-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Notes to Financial Statements
(Unaudited)
Prudential Short-Term Global Income Fund, Inc. (the ``Fund''), registered
under the Investment Company Act of 1940 as a non-diversified, open-end
management investment company, was incorporated in Maryland on February 21,
1990. The Fund consists of two series, namely: Short-Term Global Income
Portfolio and Global Assets Portfolio. The Global Assets Portfolio (the
``Portfolio'') commenced investment operations on February 15, 1991. The
investment objective of the Portfolio is to seek high current income with
minimum risk to principal, by investing primarily in high-quality debt
securities in the U.S. and abroad having remaining maturities of not more than
one year. The ability of the issuers of the debt securities held by the Fund to
meet their obligations may be affected by economic developments in a specific
country or industry.
Note 1. Accounting The following is a summary
Policies of significant accounting poli-
cies followed by the Fund, and the Portfolio in
the preparation of its financial statements.
Securities Valuation: In valuing the Fund's assets, quotations of foreign
securities in a foreign currency are converted to U.S. dollar equivalents at the
then current exchange rate. Government securities for which quotations are
available will be based on prices provided by an independent pricing service or
principal market makers. Other portfolio securities that are actively traded in
the over-the-counter market, including listed securities for which the primary
market is believed to be over-the-counter, will be valued at the average of the
quoted bid and asked prices provided by an independent pricing service or by
principal market makers. Any security for which the primary market is on an
exchange is valued at the last sale price on such exchange on the day of
valuation or, if there was no sale on such day, the last bid price quoted on
such day. Securities for which market quotations are not readily available are
valued at fair value as determined in good faith by or under the direction of
the Board of Directors.
Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost which approximates market value.
In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities--at
the closing daily rate of exchange;
(ii) purchases and sales of investment securities, income and expenses--at
the rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented at the foreign exchange
rates and market values at the close of the period, the Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the market
prices of securities held at period end. Similarly, the Fund does not isolate
the effect of changes in foreign exchange rates from the fluctuations arising
from changes in the market prices of debt securities sold during the period.
Accordingly, such realized foreign currency gains and losses are included in the
reported net realized gains/losses on investment transactions.
Net realized losses on foreign currency transactions represents net foreign
exchange gains and losses from sales and maturities of short-term securities and
forward currency contracts, holding of foreign currencies, currency gains or
losses realized between the trade and settlement dates on securities
transactions, and the difference between the amounts of interest and foreign
taxes recorded on the Fund's books and the U.S. dollar equivalent amounts
actually received or paid. Net currency gains and losses from valuing foreign
currency denominated assets (excluding investments) and liabilities at period
end exchange rates are reflected as a component of net unrealized
appreciation/depreciation on investments and foreign currencies.
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with
-8-
<PAGE>
<PAGE>
those of U.S. companies as a result of, among other factors, the possibility of
political and economic instability and the level of governmental supervision and
regulation of foreign securities markets.
Forward Currency Contracts: A forward currency contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. The Fund enters into forward currency contracts in order to hedge its
exposure to changes in foreign currency exchange rates on its foreign portfolio
holdings or on specific receivables and payables denominated in a foreign
currency. The contracts are valued daily at current exchange rates and any
unrealized gain or loss is included in net unrealized appreciation or
depreciation on investments. Gain or loss is realized on the settlement date of
the contract equal to the difference between the settlement value of the
original and renegotiated forward contracts. This gain or loss, if any, is
isolated and is included in net realized gain (loss) from foreign currency
transactions. Risks may arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their contracts.
Options: The Fund may either purchase or write options in order to hedge against
adverse market movements or fluctuations in value caused by changes in
prevailing interest rates or foreign currency exchange rates with respect to
securities or currencies which the Fund currently owns or intends to purchase.
When the Fund purchases an option, it pays a premium and an amount equal to that
premium is recorded as an investment. When the Fund writes an option, it
receives a premium and an amount equal to that premium is recorded as a
liability. The investment or liability is adjusted daily to reflect the current
market value of the option. If an option expires unexercised, the Fund realizes
a gain or loss to the extent of the premium received or paid. If an option is
exercised, the premium received or paid is an adjustment to the proceeds from
the sale or the cost basis of the purchase in determining whether the Fund has
realized a gain or loss. The difference between the premium and the amount
received or paid on effecting a closing purchase or sale transaction is also
treated as a realized gain or loss. Gain or loss on purchased options is
included in net realized gain (loss) on investment transactions. Gain or loss
on
written options is presented separately as net realized gain (loss) on written
option transactions.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from security and currency
transactions are calculated on the identified cost basis. Interest income is
recorded on the accrual basis.
Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.
Dividends and Distributions: The Fund declares daily and pays dividends from
book basis net investment income monthly and makes distributions at least
annually of any net capital gains. Dividends and distributions are recorded on
the ex-dividend date.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to differing
treatments for foreign currency transactions.
Reclassification of Capital Accounts: The Portfolio accounts and reports for
distributions to shareholders in accordance with Statement of Position 93-2;
Determination, Disclosure, and Financial Statement Presentation of Income,
Capital Gain, and Return of Capital Distributions by Investment Companies. The
effect of applying this statement was to increase accumulated distributions in
excess of net investment income and decrease accumulated net realized loss on
investments by $556,802. This was primarily the result of net foreign currency
losses incurred for the six months ended April 30, 1995. Net investment income,
net realized gains and net assets were not affected by this change. Included in
accumulated distributions in excess of net investment income as of April 30,
1995 is $4,505,980 of equalization debits.
Federal Income Taxes: For federal income tax purposes, each portfolio in the
Fund is treated as a separate taxpaying entity. It is the Portfolio's intent to
continue to meet the requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its taxable income to
shareholders. Therefore, no federal income tax provision is required.
Withholding taxes on foreign interest have been provided for in accordance
with the Fund's understanding of the applicable country's tax rules and rates.
Deferred Organization Expenses: Approximately $60,000 of organization and
initial registration costs were incurred. These costs have been deferred and are
being amortized over the period of benefit not to exceed 60 months from the date
the Portfolio commenced investment operations.
-9-
<PAGE>
<PAGE>
Note 2. Agreements The Fund has a management
agreement with Prudential Mutual Fund Management,
Inc. (``PMF''). Pursuant to this agreement, PMF has responsibility for all
investment advisory services and supervises the subadviser's performance of such
services. PMF has entered into a subadvisory agreement with The Prudential
Investment Corporation (``PIC''); PIC furnishes investment advisory services in
connection with the management of the Fund. PMF pays for the cost of the
subadviser's services, the compensation of officers of the Fund, occupancy and
certain clerical and bookkeeping costs of the Fund. The Fund bears all other
costs and expenses.
The management fee paid PMF is computed daily and payable monthly at an
annual rate of .55 of 1% of the average daily net assets of the Portfolio.
The Portfolio has a distribution agreement with Prudential Mutual Fund
Distributors, Inc. (``PMFD''), which acts as the distributor of the Class A
shares of the Portfolio. The Portfolio compensates PMFD for distributing and
servicing the Portfolio's Class A shares, pursuant to a plan of distribution,
regardless of expenses actually incurred by PMFD. The distribution fees are
accrued daily and payable monthly.
Pursuant to the Class A Plan, the Portfolio compensates PMFD for
distribution-related activities at an annual rate of up to .50 of 1% of the
average daily net assets of the Class A shares.
PMFD has advised the Portfolio that it has received approximately $1,300 in
front-end sales charges resulting from sales of Class A shares during the six
months ended April 30, 1995. From these fees, PMFD paid such sales charges to
Prudential Securities Incorporated (``PSI'') and Pruco Securities Corporation,
affiliated broker-dealers, which in turn paid commissions to salespersons and
incurred other distribution costs.
PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.
Note 3. Other Prudential Mutual Fund Ser-
Transactions vices, Inc. (``PMFS''), a
With Affiliates wholly-owned subsidiary of
PMF, serves as the Fund's transfer agent and
during the six months ended April 30, 1995, the Portfolio incurred fees of
approximately $24,300 for the services of PMFS. As of April 30, 1995,
approximately $3,800 of such fees were due to PMFS for its services. Transfer
Agent fees and expenses in the Statement of Operations include certain
out-of-pocket expenses paid to non-affiliates.
Note 4. Portfolio The federal income tax basis
Securities of the Portfolio's investments
at April 30, 1995 was substantially the same as
the basis for financial reporting purposes and, accordingly, net unrealized
appreciation for federal income tax purposes was $199,481 (gross unrealized
appreciation--$388,846; gross unrealized depreciation--$189,365).
For federal income tax purposes, the Portfolio has a capital loss
carryforward as of October 31, 1994 of approximately $10,837,000 of which
$4,584,000 expires in 2000 and $6,253,000 expires in 2001. Accordingly, no
capital gains distributions are expected to be paid to shareholders until future
net gains have been realized in excess of such carryforward.
Transactions in options written during the six months ended April 30, 1995
were as follows:
<TABLE>
<CAPTION>
Number of
Contracts Premiums
(000) Received
---------- --------
<S> <C> <C>
Options outstanding at
October 31, 1994................. -- --
Options written.................... 1,149,145 $ 44,248
Options terminated in closing
purchase transactions............ (1,149,145) (44,248)
---------- --------
Options outstanding at
April 30, 1995................... -- --
---------- --------
---------- --------
</TABLE>
At April 30, 1995, the Portfolio had outstanding forward currency contracts,
both to purchase and sell foreign currencies, as follows:
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Purchase Contracts Payable Value (Depreciation)
- ----------------------- --------------- ----------- --------------
<S> <C> <C> <C>
Australian Dollars,
expiring 5/10/95..... $ 4,496,101 $ 4,409,254 $ (86,847)
British Pounds,
expiring
5/12-6/12/95......... 5,813,210 5,867,747 54,537
Deutschemarks,
expiring
5/2-11/1/95.......... 29,293,197 29,642,644 349,447
Japanese Yen,
expiring
6/6-6/12/95.......... 2,190,624 2,199,346 8,722
New Zealand Dollars,
expiring 5/3/95...... 1,031,690 1,045,945 14,255
Spanish Pesetas,
expiring
9/11-11/2/95......... 4,844,396 5,142,239 297,843
Swedish Krona,
expiring 9/29/95..... 710,000 721,993 11,993
--------------- ----------- --------------
$ 48,379,218 $49,029,168 $ 649,950
--------------- ----------- --------------
--------------- ----------- --------------
</TABLE>
-10-
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ----------------------- --------------- ----------- --------------
<S> <C> <C> <C>
Australian Dollars,
expiring
5/10-6/13/95......... $ 7,272,709 $ 7,212,464 $ 60,245
British Pounds,
expiring 5/12/95..... 1,594,530 1,611,474 (16,944)
Canadian Dollars,
expiring 5/18/95..... 1,710,865 1,732,715 (21,850)
Deutschemarks,
expiring
5/2-11/1/95.......... 31,062,462 31,472,097 (409,635)
Italian Lira,
expiring 5/18/95..... 631,496 642,197 (10,701)
Japanese Yen,
expiring 6/6/95...... 2,200,000 2,224,826 (24,826)
New Zealand Dollars,
expiring 5/3-6/2/95.. 2,034,859 2,089,449 (54,590)
Spanish Pesetas
expiring
9/11-11/2/95......... 4,838,960 5,147,429 (308,469)
Swedish Krona,
expiring 9/29/95..... 710,000 718,144 (8,144)
--------------- ----------- --------------
$ 52,055,881 $52,850,795 $ (794,914)
--------------- ----------- --------------
--------------- ----------- --------------
</TABLE>
Note 5. Joint The Portfolio, along with
Repurchase other affiliated registered
Agreement investment companies, trans-
Account fers uninvested cash balances
into a single joint account, the daily aggregate
balance of which is invested in one or more repurchase agreements collateralized
by U.S. Treasury or Federal agency obligations. At April 30, 1995, the Fund had
a .11% undivided interest in the repurchase agreements in the joint account. The
undivided interest for the Fund represented $760,000 in principal amount. As of
such date, each repurchase agreement in the joint account and the value of the
collateral therefor were as follows:
Bear, Stearns & Co., 5.92%, in the principal amount of $125,000,000,
repurchase price $125,061,667, due 5/1/95. The value of the collateral including
accrued interest is $127,647,875.
UBS Securities Inc., 5.93%, in the principal amount of $100,000,000,
repurchase price $100,049,417, due 5/1/95. The value of the collateral including
accrued interest is $102,062,500.
Morgan Stanley and Co., Inc., 5.93%, in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.
CS First Boston Corp., 5.93%, in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.
Note 6. Capital The Portfolio currently offers
only Class A shares which are sold with a
front-end sales charge of up to .99%. The Portfolio discontinued offering Class
B shares on April 14, 1993. Class B shares automatically converted to Class A
shares upon being held longer than one year from the date of purchase. Effective
May 10, 1994, the remaining Class B shares converted to Class A shares. There
are 500 million authorized shares of $.001 par value common stock divided into
two classes, designated Class A and Class B common stock, each of which consists
of 250 million authorized shares.
Transactions in shares of common stock for the six months ended April 30,
1995 and the fiscal year ended October 31, 1994 were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ------------------------------- ----------- ------------
<S> <C> <C>
Six months ended April 30,
1995:
Shares sold.................... 637,013 $ 1,136,130
Shares issued in reinvestment
of dividends................. 394,653 703,121
Shares reacquired.............. (10,760,411) (19,218,376)
----------- ------------
Net decrease in shares
outstanding.................. (9,728,745) $(17,379,125)
----------- ------------
----------- ------------
Year ended October 31, 1994:
Shares sold.................... 1,787,071 $ 3,241,520
Shares sold--conversion from
Class B...................... 844,439 1,580,500
Shares issued in reinvestment
of dividends................. 1,447,695 2,676,200
Shares reacquired.............. (43,793,517) (80,885,842)
----------- ------------
Net decrease in shares
outstanding.................. (39,714,312) $(73,387,622)
----------- ------------
----------- ------------
<CAPTION>
Class B
- -------------------------------
Year ended October 31, 1994:
Shares issued in reinvestment
of dividends................. 4,960 $ 9,443
Shares reacquired.............. (236,484) (446,458)
Shares reacquired--conversion
into Class A................. (831,163) (1,580,500)
----------- ------------
Net decrease in shares
outstanding.................. (1,062,687) $ (2,017,515)
----------- ------------
----------- ------------
</TABLE>
-11-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Financial Highlights
(Unaudited)
<TABLE>
<CAPTION>
Class A
Class B
-------------------------------------------------------------
- ---------------------------------------------------
February 15,
November 1, February 15,
Six Months Year Ended 1991*
1993 Year Ended 1991*
Ended October 31, through
through October 31, through
April 30, ------------------------------- October 31,
May 9, ------------------- October 31,
1995 1994 1993 1992 1991
1994@ 1993 1992 1991
---------- ------- -------- -------- ------------
- ----------- ------- -------- ------------
<S> <C> <C> <C> <C> <C>
<C> <C> <C> <C>
PER SHARE
OPERATING
PERFORMANCE:
Net asset
value,
beginning
of
period... $ 1.80 $ 1.88 $ 1.89 $ 2.00 $ 2.00
$1.90 $ 1.89 $ 2.00 $ 2.00
---------- ------- -------- -------- ------------
----- ------- -------- ------------
Income
from
investment
operations
Net
investment
income... .04 .08 .12 .16 .12D
.04 .12 .15 .11D
Net
realized
and
unrealized
gain
(loss)
on
investment
and
foreign
currency
transactions... (.01) (.07) (.04) (.13) --
(.03) (.04) (.13) --
---------- ------- -------- -------- ------------
----- ------- -------- ------------
Total
from
investment
operations... .03 .01 .08 .03 .12
.01 .08 .02 .11
------- ----- -------- -------- ------------
----- ------- -------- ------------
Less
distributions
Dividends
from net
investment
income... (04) -- (.04) (.14) (.12)
-- (.04) (.13) (.11)
Tax return
of
capital
distributions.. -- (.09) (.05) -- --
(.05) (.05) -- --
------- ------- -------- -------- ------------
- ----- ------- -------- ------------
Total
distributions. (.04) (.09) (.09) (.14) (.12)
(.05) (.09) (.13) (.11)
-------- ------- -------- -------- ----------
----- ------- -------- ------------
Contingent
deferred
sales
charges
collected... -- -- -- -- --
.03 .02 -- --
---------- ------- -------- -------- ------------
----- ------- -------- ------------
Net asset
value,
end of
period... $ 1.79 $ 1.80 $ 1.88 $ 1.89 $ 2.00
$1.89 $ 1.90 $ 1.89 $ 2.00
---------- ------- -------- -------- ------------
- ----- ------- -------- ------------
---------- ------- -------- -------- ------------
- ----- ------- -------- ------------
TOTAL
RETURN#:... 1.81% 0.47% 4.36% 1.46% 5.91%
2.33% 5.47% 0.94% 5.53%
RATIOS/SUPPLEMENTAL
DATA:
Net
assets,
end of
period
(000)... $ 32,726 $50,537 $127,490 $113,412 $ 86,443
$0 $ 2,023 $199,890 $ 134,015
Average
net
assets
(000)... $ 40,752 $82,267 $153,339 $138,331 $ 23,224
$ 525 $52,653 $248,941 $ 42,449
Ratios to
average
net
assets:
Expenses,
including
distribution
fees... 2.11%** 1.73% 1.48% 1.33% 1.25%D**
1.21%** 1.61% 1.83% 1.75%D**
Expenses,
excluding
distribution
fees... 1.61%** 1.23% .98% .83% .75%D**
1.21%** .98% .83% .75%D**
Net
investment
income... 5.18%** 4.09% 6.44% 8.16% 8.64%D**
4.48%** 6.31% 7.66% 8.21%D**
- ---------------
</TABLE>
* Commencement of investment operations.
** Annualized.
# Total return does not consider the effects of sales loads. Total return
is calculated assuming a purchase of shares on the first day and a sale
on the last day of each period reported and includes reinvestment
of dividends. Total returns for periods of less than a full year are
not annualized.
D Net of expense subsidy.
@ Last day of investment operations of Class B shares. On May 10, 1994,
all existing Class B shares were converted to Class A shares.
See Notes to Financial Statements.
-12-
<PAGE>
<PAGE>
Directors
Stephen C. Eyre
Delayne Dedrick Gold
Don G. Hoff
Harry A. Jacobs, Jr.
Sidney R. Knafel
Robert E. La Blanc
Thomas A. Owens, Jr.
Richard A. Redeker
Clay T. Whitehead
Officers
Richard A. Redeker, President
Robert F. Gunia, Vice President
Grace Torres, Treasurer
Stephen M. Ungerman, Asst. Treasurer
S. Jane Rose, Secretary
Ellyn C. Acker, Asst. Secretary
Manager
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, NY 10292
Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07101
Distributors
Prudential Mutual Fund Distributors, Inc.
Prudential Securities Incorporated
One Seaport Plaza
New York, NY 10292
Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
Transfer Agent
Prudential Mutual Fund Services, Inc.
P.O. Box 15005
New Brunswick, NJ 08906
Independent Accountants
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281
Legal Counsel
Shereff, Friedman, Hoffman & Goodman
919 Third Avenue
New York, NY 10022
Prudential Mutual Funds
One Seaport Plaza
New York, NY 10292
Toll Free (800) 225-1852, Collect (908) 417-7555
The accompanying financial statements as of April 30, 1995 were not
audited and, accordingly, no opinion is expressed on them. This report
is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus.
MF149E2
74436H309 (LOGO) Cat. #4443624
SEMI ANUAL REPORT April 30, 1995
Prudential
Short-Term Global Income Fund, Inc.
(ICON)
Short-Term
Global Income
Portfolio
(LOGO)
<PAGE>
Letter to Shareholders
June 9, 1995
Dear Shareholder:
Although the U.S. dollar showed continued weakness through much of the first
quarter of 1995, global bond markets are recovering from their dismal
performance in 1994. Given this environment, we are pleased to report that
the Prudential Short-Term Global Income Fund/Short-Term Global Income Portfolio
produced higher returns than the Lipper Short-Term World Multi-Market Average
for the six-month period ending April 30, 1995.
Fund Performance.
The Short-Term Global Income Portfolio's net asset value (NAV) began the
reporting period with an NAV of $8.56 for Class A, B and C shares. It finished
with NAVs of $8.33 for Class A shares and $8.36 for both Class B and C shares.
Dividends totaling $0.28 for Class A shares and $0.26 for Class B and C shares
were also paid during the period.
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURNS1
As of 4/30/95
6 Mos. One Year Since Inception2
<S> <C> <C> <C>
Class A 0.7% -0.7% 17.8%
Class B 0.7% -1.0% 13.9%
Class C 0.7% N/A 1.5%
Lipper ST World -1.2% 0.5% 3.5%
Fund Average3
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL RETURNS1
As of3/31/95
One Year Since Inception2
<S> <C> <C>
Class A -4.0% 2.8%
Class B -4.4% 2.8%
Class C N/A -0.5%
</TABLE>
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
1 Source: Prudential Mutual Fund Management Inc. and Lipper Analytical Services,
Inc. Cumulative total returns do not take into account sales charges. The
average annual returns do take into account applicable sales charges. The Fund
charges a maximum front-end sales load of 3% for Class A shares. Class B shares
are subject to a declining contingent deferred sales charge (CDSC) of 3%, 2%,
1% and 1%, for four years. Class C shares have a 1% CDSC for one year. Class
B shares will automatically convert to Class A shares on a quarterly basis,
after approximately five years.
2 Inception of Class A and B 11/01/90; Class C 8/1/94.
3 This figure is the average of 44 funds in the Short-Term World Multi-Market
Average for six-months; 40 funds for one year; and 14 funds since inception
for the period ending April 30, 1995, as measured by Lipper Analytical
Services, Inc.
-1-
<PAGE>
The Fund's Objective.
The Prudential Short-Term Global Income Fund/Short-Term Global Income Portfolio
seeks to maximize total return, the components of which are current income and
capital appreciation by primarily investing in debt securities having remaining
maturities of not more than three years. The Portfolio invests in debt
securities denominated in the U.S. dollar and a range of foreign currencies.
There can be no assurance that the Fund's investment objective will be achieved.
The Portfolio is permitted to invest up to 10% of its total assets in securities
rated below investment grade with a minimum rating of "B" as determined
by Moodys' Investor Services, Standard & Poor's Ratings Group or similar
ratings agency, and in unrated securities of equivalent quality. Investments
in lower rated or unrated securities carry special risks. The Short-Term Global
Income Portfolio is non-diversified, meaning it may invest more than 5% of its
total assets in securities of one or more issuers. Investment in a
non-diversified fund carries greater risk than investment in a diversified
portfolio.
A Global View of World Markets.
Bond markets are beginning to recover from 1994's poor showing. For the
four-month period ending on April 30, 1995, the Lipper Short-Term World
Multi-Market Average posted a gain of 1.4%. Performance was generally positive
across the board in local currency terms and was further bolstered by currency
performance.
Investor perception has clearly changed with signs that the U.S. economy is
indeed slowing and responding to the aggressive interest rate policy of the
U.S. Federal Reserve. Fewer housing starts, sluggish car sales, higher
unemployment numbers and other signs pointed to a so-called "soft landing" for
the U.S. economy, and not to a recession as some had feared.
The U.S. dollar took center stage for much of the reporting period, especially
during March. Failure to pass a balanced budget amendment in Congress coupled
with slim prospects for higher U.S. interest rates served to undermine
confidence in the U.S. currency. The German central bank responded by cutting
its discount rate by 50 basis points and the Japanese followed suit by reducing
their rate by the same amount. The result: the German mark rose 6% and the
Japanese yen a stunning 10% -- against the U.S. dollar.
What We Did.
We strongly favored hard currencies of the major, stable economies of central
Europe, such as the German mark or Swiss franc, as strains within the European
currency mechanism developed. During the reporting period the Spanish peseta
and Portuguese escudo were devalued against the mark. This resulted in a
premium being attached to core currency holdings with strong
-2-
<PAGE>
fundamentals (marks or francs). Conversely, Sweden, Italy and Spain had
additional risk assigned to their currencies. These three nations offer some
of
the highest yielding bonds in Europe and have made up some ground lost earlier
in the year. We will be carefully monitoring developments here and how they may
affect our investment positions.
The Fund's bond holdings were heavily invested in markets that tended to
perform better on the basis of currency strength and a "flight to quality" by
many investors. For instance, we were drawn to Canada and New Zealand where
significant central bank tightening and undervalued currencies made investments
especially attractive. Attractive yields, a proactive British central bank
plus a strong currency also drew us to bonds from the United Kingdom.
The Outlook.
There are indications that the current global bond rally may have run its
course. Nevertheless foreign markets will remain an attractive investment
choice for U.S. investors, because they offer the potential for better long-term
performance and add an element of diversification to most portfolios.
Please understand that there are special risks involved with foreign investing.
Foreign securities are not guaranteed and may be influenced by currency
fluctuations, political and social developments. Foreign businesses are also
not subject to the same level of risk disclosure as they would be in the United
States. These risks are described fully in the Fund prospectus.
For further insight into what may be in store for global markets, we invite you
to read the following "Portfolio Q & A" feature with new portfolio managers
Simon Wells and Gabriel Irwin.
As always, it is a pleasure to have you as a shareholder of the Prudential
Short-Term Global Income Fund/Short-Term Global Income Portfolio, where we are
committed to managing the Fund for your benefit.
Sincerely,
Simon Wells Gabriel Irwin
Portfolio Manager Portfolio Manager
Richard A. Redeker
President
-3-
<PAGE>
PORTFOLIO Q&A
We are proud to announce that Simon Wells and Gabriel Irwin have joined
Prudential Mutual Funds. They will be managing the Prudential Short-Term
Global Income Fund/Short-Term Global Income Portfolio. We talked to them
about their outlook for the global bond markets in 1995.
Q. Why have global bonds performed so well this year? How long
can it last?
A. You have to view the first quarter rally in the context of
what happened in 1994. Last year was not good for bonds anywhere
in the world. By year-end, short-term investors had been
frightened out of the market and portfolio maturities were
generally low. A number of market participants had shortened
maturities expecting rising interest rates. So when interest
rates started falling, they were forced to buy longer term bonds,
which in turn has fueled bond price increases. Such is life in
the investment world. Our belief is that there isn't much steam
left in this rally, because although world inflation is low, we
are in an economic upturn usually the most bullish environment
for bonds.
Q. Why not just buy U.S. bonds and avoid foreign risk altogether?
A. Foreign bonds do not necessarily follow the U.S.
market. One of the attractions of the foreign bond market for
risk-tolerant U.S. investors is that there are almost invariably
better return opportunities in a number of foreign countries.
Since the 1970s, the U.S. has been the best-performing market in
only one year . This year alone, the Japanese bond market has
returned nearly 25% to U.S. investors. Also, there is always a
strong case for adding foreign bonds to a domestic portfolio for
purposes of diversification.
-4-
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC. Portfolio of Invvestments
SHORT-TERM GLOBAL INCOME PORTFOLIO April 30, 1995 (Unaudited)
<TABLE>
<CAPTION>
Principal US$
Amount Value
(000) Description (Note 1)
<C> <S> <C>
LONG-TERM INVESTMENTS--41.1%
Australia--12.6%
Queensland Treasury
Corp.,
A$ 8,975 8.00%, 5/14/97........... $ 6,416,458
South Australia Fin.
Auth.,
7,815 12.50%, 3/15/98.......... 6,158,327
Victorian Treasury Corp.,
8,500 12.50%, 9/15/97.......... 6,654,026
------------
19,228,811
------------
Denmark--7.2%
Kingdom of Denmark,
DKr 60,100 7.00%, 8/15/97........... 10,962,281
------------
Italy--3.1%
Export Finance of Norway,
Lira 8,000,000 12.25%, 8/5/96........... 4,783,095
------------
United Kingdom--17.9%
Bayerische Hypothelsen
Bank,
(BR PD)5,000 11.125%, 6/24/96......... 8,325,679
United Kingdom Treasury
Bonds,
4,350 13.25%, 1/22/97.......... 7,616,706
5,000 8.75%, 9/1/97............ 8,188,300
2,000 7.25%, 3/30/98........... 3,148,417
------------
27,279,102
------------
United States--0.3%
Cedulas Hipotecarias
Rurales,
US$ 600 7.9%, 9/1/00............. 483,000
------------
Total long-term
investments
(cost US$63,032,550)..... 62,736,289
------------
SHORT-TERM INVESTMENTS--58.7%
Canada--11.9%
Canadian Treasury Bills,*
C$ 10,000 8.25%, 5/18/95........... $ 7,320,477
15,000 8.37%, 8/3/95............ 10,801,125
------------
18,121,602
------------
Mexico--0.1%
Mexican Tesobonos,*
US$ 114 8.40%, 8/17/95........... 108,961
------------
New Zealand--10.6%
New Zealand Treasury
Bills,*
NZ$ 11,075 8.47%, 6/21/95........... 7,347,178
13,400 9.36%, 8/2/95............ 8,815,365
------------
16,162,543
------------
Spain--0.8%
Nordic Investment Bank,
Pts 150,000 13.80%, 11/30/95......... 1,243,819
------------
United Kingdom--3.1%
United Kingdom, C.D.,
Bank of Scotland,
(BR PD)2,500 7.59%, 12/15/95.......... 4,030,526
500 7.50%, 12/19/95.......... 804,875
------------
4,835,401
------------
United States--32.2%
Joint Repurchase
Agreement Account,
US$ 7,371 5.90%, 5/1/95, (Note
5)..................... 7,371,000
United States Treasury
Bills,*
36,000 5.83%, 5/25/95........... 35,847,986
6,000 6.35%, 8/10/95........... 5,901,721
------------
49,120,707
------------
Total short-term
investments
(cost US$87,984,205)..... 89,593,033
------------
</TABLE>
-5- See Notes to Financial Statements.
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
<TABLE>
<CAPTION>
US$
Value
Description (Note 1)
<C> <S> <C>
Total Investments--99.8%
(cost US$151,016,755;
Note 4)................ $152,329,322
Other assets in excess of
liabilities--0.2%........ 310,760
------------
Net Assets--100%......... $152,640,082
------------
------------
</TABLE>
- ---------------
Portfolio securities are classified according to the security's
currency denomination.
* Percentage quoted represents yield to maturity as
of purchase date.
C.D.--Certificates of Deposit.
-6- See Notes to Financial Statements.
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Statement of Assets and Liabilities
(Unaudited)
<TABLE>
<CAPTION>
Assets
April 30, 1995
--------------
<S>
<C>
Investments, at value (cost
$151,016,755)................................................. $ 152,329,322
Foreign currency, at value (cost
$3,232).................................................. 3,457
Receivable for investments
sold........................................................... 6,664,602
Forward currency contracts--net amount receivable from
counterparties..................... 3,872,066
Interest
receivable...................................................................
.... 2,833,563
Receivable for Fund shares
sold........................................................... 3,019
Deferred expenses and other
assets........................................................ 31,187
--------------
Total
assets..........................................................................
165,737,216
--------------
Liabilities
Payable for investments
purchased.........................................................
6,409,241
Forward currency contracts--net amount payable to
counterparties.......................... 4,635,652
Payable for Fund shares
reacquired........................................................
1,295,708
Accrued
expenses.....................................................................
..... 313,872
Dividends
payable.........................................................................
259,879
Due to
Distributors.................................................................
...... 86,549
Due to
Manager......................................................................
...... 70,785
Withholding taxes
payable.................................................................
25,448
--------------
Total
liabilities.....................................................................
13,097,134
--------------
Net
Assets.......................................................................
......... $ 152,640,082
--------------
--------------
Net assets were comprised of:
Common stock, at
par.................................................................... $
18,270
Paid-in capital in excess of
par........................................................ 206,344,469
--------------
206,362,739
Accumulated distributions in excess of net investment
income............................ (13,456,092)
Accumulated net realized loss on
investments............................................ (40,822,609)
Net unrealized appreciation on investments and foreign
currencies....................... 556,044
--------------
Net assets, April 30,
1995................................................................ $
152,640,082
--------------
--------------
Class A:
Net asset value and redemption price per share
($19,664,988 / 2,359,752 shares of common stock issued and
outstanding)............... $8.33
Maximum sales charge (3.00% of offering
price).......................................... .26
--------------
Maximum offering price to
public........................................................ $8.59
--------------
--------------
Class B:
Net asset value, offering price and redemption price per share
($132,969,327 / 15,909,377 shares of common stock issued and
outstanding)............. $8.36
--------------
--------------
Class C:
Net asset value, offering price and redemption price per share
($5,767 / 690 shares of common stock issued and
outstanding).......................... $8.36
--------------
--------------
</TABLE>
See Notes to Financial Statements.
-7-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
Six Months
Ended
April 30,
Net Investment Income 1995
-----------
<S> <C>
Income
Interest........................... $ 7,554,560
-----------
Expenses
Distribution fee--Class A.......... 15,832
Distribution fee--Class B.......... 589,813
Management fee..................... 490,580
Custodian's fees and expenses...... 265,000
Transfer agent's fees and
expenses......................... 171,000
Reports to shareholders............ 40,000
Registration fees.................. 34,000
Amortization of organization
expenses......................... 20,000
Audit fee.......................... 17,500
Directors' fees.................... 17,500
Legal.............................. 15,000
Miscellaneous...................... 8,080
-----------
Total expenses................... 1,684,305
-----------
Net investment income................ 5,870,255
-----------
Realized and Unrealized
Gain (Loss) on Investments and
Foreign Currency Transactions
Net realized gain (loss) on:
Investment transactions............ (5,033,664)
Foreign currency transactions...... 1,092,586
Written option transactions........ (800,657)
-----------
(4,741,735)
-----------
Net change in unrealized
appreciation/
depreciation of:
Investments........................ (1,968,785)
Foreign currencies................. 1,665,176
-----------
(303,609)
-----------
Net loss on investments and foreign
currencies......................... (5,045,344)
-----------
Net Increase in Net Assets
Resulting from Operations............ $ 824,911
-----------
-----------
</TABLE>
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Statement of Changes in Net Assets
(Unaudited)
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
Increase (Decrease) April 30, October 31,
in Net Assets 1995 1994
------------ ------------
<S> <C> <C>
Operations
Net investment
income................. $ 5,870,255 $ 22,096,655
Net realized loss on
investments and
foreign currency
transactions......... (4,741,735) (35,450,639)
Net change in
unrealized
appreciation/depreciation
of investments and
foreign currencies... (303,609) 5,768,258
------------ ------------
Net increase (decrease)
in net assets resulting
from operations........ 824,911 (7,585,726)
------------ ------------
Net equalization
debits................. (165,706) --
------------ ------------
Dividends and distributions (Note 1)
Dividends from net
investment income
Class A.............. (493,233) --
Class B.............. (3,309,846) --
Class C.............. (25) --
------------ ------------
(3,803,104) --
------------ ------------
Distributions in excess
of net investment
income
Class A.............. (227,582) --
Class B.............. (1,527,191) --
Class C.............. (12) --
------------ ------------
(1,754,785) --
------------ ------------
Tax return of capital
distributions
Class A.............. -- (2,411,703)
Class B.............. -- (15,406,444)
------------ ------------
-- (17,818,147)
------------ ------------
Fund share transactions
(net of share
conversions) (Note 6)
Proceeds from shares
subscribed........... 7,275,020 11,205,281
Net asset value of
shares issued in
reinvestment of
dividends and
distributions........ 3,264,912 10,703,295
Cost of shares
reacquired........... (70,809,033) (213,168,513)
------------ ------------
Net decrease in net
assets from Fund share
transactions........... (60,269,101) (191,259,937)
------------ ------------
Total decrease........... (65,167,785) (216,663,810)
Net Assets
Beginning of period...... 217,807,867 434,471,677
------------ ------------
End of period............ $152,640,082 $217,807,867
------------ ------------
------------ ------------
</TABLE>
See Notes to Financial Statements. See Notes to Financial Statements.
-8-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Notes to Financial Statements
(Unaudited)
Prudential Short-Term Global Income Fund, Inc. (the ``Fund'') is registered
under the Investment Company Act of 1940 as a non-diversified, open-end
management investment company. The Fund consists of two series, namely:
Short-Term Global Income Portfolio and Global Assets Portfolio. The Fund was
incorporated in Maryland on February 21, 1990 and had no significant operations
other than the issuance of 5,000 shares each of Class A and Class B common stock
of the Short-Term Global Income Portfolio for $100,000 on September 21, 1990 to
Prudential Mutual Fund Management, Inc. (``PMF''). The Short-Term Global Income
Portfolio (the ``Portfolio'') commenced investment operations on November 1,
1990. The investment objective of the Portfolio is to maximum total return, the
components of which are current income and capital appreciation, by investing
primarily in a portfolio of investment grade debt securities denominated in U.S.
dollar and a range of foreign currencies having remaining maturities of not more
than three years. The ability of the issuers of the debt securities held by the
Fund to meet their obligations may be affected by economic developments in a
specific country or industry.
Note 1. Accounting The following is a summary of
Policies significant accounting policies
followed by the Fund, and the Portfolio in the
preparation of its financial statements.
Securities Valuation: In valuing the Fund's assets, quotations of foreign
securities in a foreign currency are converted to U.S. dollar equivalents at the
then current currency value. Government securities for which quotations are
available will be based on prices provided by an independent pricing service or
principal market makers. Other portfolio securities that are actively traded in
the over-the-counter market, including listed securities for which the primary
market is believed to be over-the-counter, will be valued at the average of the
quoted bid and asked prices provided by an independent pricing service or by
principal market makers. Any security for which the primary market is on an
exchange is valued at the last sale price on such exchange on the day of
valuation or, if there was no sale on such day, the last bid price quoted on
such day. Securities for which market quotations are not readily available are
valued at fair value as determined in good faith by or under the direction of
the Board of Directors.
Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost which approximates market value.
In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities--at
the closing daily rate of exchange;
(ii) purchases and sales of investment securities, income and expenses--at
the rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented at the foreign exchange
rates and market values at the close of the fiscal period, the Fund does not
isolate that portion of the results of operations arising as a result of changes
in the foreign exchange rates from the fluctuations arising from changes in the
market prices of securities held at the end of the fiscal period. Similarly, the
Fund does not isolate the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of long-term debt
securities sold during the fiscal period.
Net realized loss on foreign currency transactions represents net foreign
exchange gains or losses from sales and maturities of short-term securities,
holding of foreign currencies, currency gains or losses realized between the
trade and settlement dates on security transactions, and the difference between
the amounts of interest and foreign taxes recorded on the Fund's books and the
U.S. dollar equivalent amounts actually received or paid. Net unrealized
currency gains and losses from valuing foreign currency denominated assets and
liabilities at fiscal period end exchange rates are reflected as a component of
net unrealized appreciation/depreciation on investments and foreign currencies.
-9-
<PAGE>
<PAGE>
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of U.S. companies as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and regulation of foreign securities
markets.
Forward Currency Contracts: A forward currency contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. The Fund enters into forward currency contracts in order to hedge its
exposure to changes in foreign currency exchange rates on its foreign portfolio
holdings or on specific receivables and payables denominated in a foreign
currency. The contracts are valued daily at current exchange rates and any
unrealized gain or loss is included in net unrealized appreciation or
depreciation on investments. Gain or loss is realized on the settlement date of
the contract equal to the difference between the settlement value of the
original and renegotiated forward contracts. This gain or loss, if any, is
included in net realized gain (loss) on foreign currency transactions. Risks may
arise upon entering into these contracts from the potential inability of the
counterparties to meet the terms of their contracts.
Options: The Fund may either purchase or write options in order to hedge against
adverse market movements or fluctuations in value caused by changes in
prevailing interest rates or foreign currency exchange rates with respect to
securities or currencies which the Fund currently owns or intends to purchase.
When the Fund purchases an option, it pays a premium and an amount equal to that
premium is recorded as an investment. When the Fund writes an option, it
receives a premium and an amount equal to that premium is recorded as a
liability. The investment or liability is adjusted daily to reflect the current
market value of the option. If an option expires unexercised, the Fund realizes
a gain or loss to the extent of the premium received or paid. If an option is
exercised, the premium received or paid is an adjustment to the proceeds from
the sale or the cost basis of the purchase in determining whether the Fund has
realized a gain or loss. The difference between the premium and the amount
received or paid on effecting a closing purchase or sale transaction is also
treated as a realized gain or loss. Gain or loss on purchased options is
included in net realized gain (loss) on investment transactions. Gain or loss
on
written options is presented separately as net realized gain (loss) on written
option transactions.
The Fund, as writer of an option, has no control over whether the underlying
securities or currencies may be sold (called) or purchased (put). As a result,
the Fund bears the market risk of an unfavorable change in the price of the
security or currency underlying the written option. The Fund, as purchaser of
an
option, bears the risk of the potential inability of the counterparties to meet
the terms of their contracts.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from security and currency
transactions are calculated on the identified cost basis. Interest income is
recorded on the accrual basis.
Net investment income (other than distribution fees) and unrealized and
realized gains or losses are allocated daily to each class of shares based upon
the relative proportion of net assets of each class at the beginning of the day.
Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.
Dividends and Distributions: The Fund declares daily and pays dividends from
book basis net investment income monthly and makes distributions at least
annually of any net capital gains. Dividends and distributions are recorded on
the ex-dividend date.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to differing
treatments for foreign currency transactions.
Reclassification of Capital Accounts: The Portfolio accounts and reports for
distributions to shareholders in accordance with Statement of Position 93-2:
Determination, Disclosure, and Financial Statement Presentation of Income,
Capital Gain, and Return of Capital Distributions by Investment Companies. The
effect of applying this statement was to increase accumulated distributions in
excess of net investment income and decrease accumulated net realized loss on
investments by $2,627,110. This was primarily the result of net foreign currency
losses incurred for the six months ended April 30, 1995. Net investment income,
net realized gains and net assets were not affected by this change. Included in
accumulated distributions in excess of net investment income as of April 30,
1995 is $11,290,809 of equalization debits.
Federal Income Taxes: For federal income tax purposes, each portfolio in the
Fund is treated as a separate taxpaying entity. It is the Portfolio's intent to
continue to meet the requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its
-10-
<PAGE>
<PAGE>
taxable income to shareholders. Therefore, no federal income tax provision is
required.
Withholding taxes on foreign interest have been provided for in accordance
with the Fund's understanding of the applicable country's tax rules and rates.
Deferred Organization Expenses: Approximately $200,000 of organization and
initial registration costs were incurred. These costs have been deferred and are
being amortized over the period of benefit not to exceed 60 months from the date
the Portfolio commenced investment operations. PMF has agreed not to redeem the
10,000 shares purchased until all organization expenses have been amortized.
Note 2. Agreements The Fund has a management
agreement with Prudential Mutual Fund Management
(``PMF''). Pursuant to this agreement, PMF has responsibility for all investment
advisory services and supervises the subadviser's performance of such services.
PMF has entered into a subadvisory agreement with The Prudential Investment
Corporation (``PIC''); PIC furnishes investment advisory services in connection
with the management of the Fund. PMF pays for the cost of the subadviser's
services, the compensation of officers of the Fund, occupancy and certain
clerical and bookkeeping costs of the Fund. The Fund bears all other costs and
expenses.
The management fee paid PMF is computed daily and payable monthly at an
annual rate of .55 of 1% of the average daily net assets of the Portfolio.
The Portfolio has distribution agreements with Prudential Mutual Fund
Distributors, Inc. (``PMFD''), which acts as the distributor of the Class A
shares of the Fund, and with Prudential Securities Incorporated (``PSI''), which
acts as distributor of the Class B and Class C shares of the Fund. The Portfolio
reimburses PMFD and compensates PSI for distributing and servicing the Fund's
Class A, Class B and Class C shares, pursuant to plans of distribution (the
``Class A, B and C Plans''). The distribution fees are accrued daily and payable
monthly.
Pursuant to the Class A Plan, the Portfolio reimburses PMFD for its expenses
with respect to Class A shares at an annual rate of up to .30 of 1% of the
average daily net assets of the Class A shares. Such expenses under the Class
A
Plan were .15 of 1% of the average daily net assets of the Class A shares for
the six months ended April 30, 1995. PMFD pays various broker-dealers, including
PSI and Pruco Securities Corporation (``Prusec''), affiliated broker-dealers,
for account servicing fees and other expenses incurred by such broker-dealers.
Pursuant to the Class B and C Plans, the Portfolio compensates PSI for
distribution-related activities at an annual rate of up to 1% of the average
daily net assets of both the Class B and C shares. Such expenses under the Class
B and Class C Plans were both charged at .75 of 1% of the average daily net
assets of the Class B and Class C shares for the six months ended April 30,
1995.
PMFD has advised the Portfolio that it has received approximately $2,100 in
front-end sales charges resulting from sales of Class A shares during the six
months ended April 30, 1995. From these fees, PMFD paid such sales charges to
dealers which in turn paid commissions to salespersons.
PSI has advised the Portfolio that for the six months ended April 30, 1995,
it received approximately $278,800 in contingent deferred sales charges imposed
upon certain redemptions by Class B shareholders.
PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.
Note 3. Other Prudential Mutual Fund Ser-
Transactions vices, Inc. (``PMFS'') a
With Affiliates wholly-owned subsidiary of
PMF, serves as the Fund's transfer agent and
during the six months ended April 30, 1995, the Portfolio incurred fees of
approximately $130,800 for the services of PMFS. As of April 30, 1995,
approximately $20,600 of such fees were due to PMFS. Transfer agent fees and
expenses in the Statement of Operations include certain out-of-pocket expenses
paid to non-affiliates.
Note 4. Portfolio Purchases and sales of invest-
Securities ment securities, other than
short-term investments and options, for the six
months ended April 30, 1995 aggregated $103,456,830 and $181,991,600,
respectively.
The United States federal income tax basis of the Fund's investments at April
30, 1995 was substantially the same as for financial reporting purposes and,
accordingly, net unrealized appreciation of investments, for United States
federal income tax purposes was $1,312,567 (gross unrealized
appreciation--$2,304,151; gross unrealized depreciation--$991,584).
For federal income tax purposes, the Portfolio had a capital loss
carryforward as of October 31, 1994, of approximately $38,708,000 of which
$26,697,000 expires in 2001 and $12,011,000 expires in 2002. Accordingly, no
capital gains distributions are expected to be paid to shareholders until future
net gains have been realized in excess of such carryforward.
-11-
<PAGE>
<PAGE>
Transactions in options written during the six months ended April 30, 1995
were as follows:
<TABLE>
<CAPTION>
Number of
Contracts Premiums
(000) Received
---------- ---------
<S> <C> <C>
Options outstanding at October 31,
1994................................. -- --
Options written........................ 24,626 $ 168,894
Options terminated in closing purchase
transactions......................... (24,626) (168,894)
---------- ---------
Options outstanding at April 30,
1995................................. -- --
---------- ---------
---------- ---------
</TABLE>
At April 30, 1995, the Portfolio had outstanding forward currency contracts,
both to purchase and sell foreign currencies, as follows:
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Purchase Contracts Payable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
Australian
Dollars,
expiring
5/10/95......... $ 26,489,322 $ 25,968,304 $ (521,018)
British Pounds,
expiring
5/10-6/12/95.... 3,712,652 3,750,292 37,640
Deutschemarks,
expiring
5/2-11/1/95..... 145,262,639 147,001,481 1,738,842
French Francs,
expiring
10/10/95........ 3,946,325 3,870,606 (75,719)
Japanese Yen,
expiring
6/6-6/12/95..... 10,375,235 10,405,356 30,121
Spanish Pesetas,
expiring
9/11-11/2/95.... 25,156,046 26,679,412 1,523,366
Swedish Krona,
expiring
9/29/95......... 3,120,000 3,172,701 52,701
--------------- ------------ -----------
$ 218,062,219 $220,848,152 $ 2,785,933
--------------- ------------ -----------
--------------- ------------ -----------
</TABLE>
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
Australian
Dollars,
expiring
5/10-6/13/95.... $ 45,026,076 $ 44,624,706 $ 401,370
British Pounds,
expiring
5/10-6/12/95.... 15,990,500 16,127,270 (136,770)
Canadian Dollars,
expiring
5/18/95......... 7,648,094 7,745,769 (97,675)
Deutschemarks,
expiring
5/2-11/1/95..... 163,950,682 165,880,839 (1,930,157)
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
French Francs,
expiring
10/10/95........ $ 3,965,903 $ 3,989,382 $ (23,479)
Italian Lira,
expiring
5/18/95......... 2,901,114 2,950,273 (49,159)
Japanese Yen,
expiring
6/6/95.......... 10,000,000 10,112,847 (112,847)
Spanish Pesetas,
expiring
9/11-11/2/95.... 26,538,702 28,103,482 (1,564,780)
Swedish Krona,
expiring
9/29/95......... 3,140,000 3,176,022 (36,022)
--------------- ------------ -----------
$ 279,161,071 $282,710,590 $(3,549,519)
--------------- ------------ -----------
--------------- ------------ -----------
</TABLE>
Note 5. Joint The Portfolio, along with
Repurchase other affiliated registered
Agreement investment companies,
Account transfers uninvested cash
balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or Federal agency obligations. As of April 30,
1995, the Portfolio has a 1.09% undivided interest in the repurchase agreements
in the joint account. The undivided interest for the Portfolio represents
$7,371,000 in principal amount. As of such date, each repurchase agreement in
the joint account and the value of the collateral therefor were as follows:
Bear, Stearns & Co., 5.92%, in the principal amount of $125,000,000,
repurchase price $125,061,667, due 5/1/95. The value of the collateral including
accrued interest is $127,647,875.
UBS Securities Inc., 5.93%, in the principal amount of $100,000,000,
repurchase price $100,049,417, due 5/1/95. The value of the collateral including
accrued interest is $102,062,500.
Morgan Stanley and Co., Inc., 5.93%, in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.
CS First Boston Corp., 5.93%, in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.
-12-
<PAGE>
<PAGE>
Note 6. Capital The Portfolio currently offers
Class A, Class B and Class C shares. Class A
shares are sold with a front-end sales charge of up to 3.0%. Class B shares are
sold with a contingent deferred sales charge which declines from 3% to zero
depending on the period of time the shares are held. Class C shares are sold
with a contingent deferred sales charge of 1% during the first year. Class B
shares will automatically convert to Class A shares on a quarterly basis
approximately five years after purchase.
The Fund has authorized 1.5 billion shares of common stock at $.001 par value
per share equally divided into Class A, B and C shares. Of the 18,269,819 shares
of common stock issued and outstanding at April 30, 1995, PMF owned 10,000
shares.
Transactions in shares of common stock for the six months ended April 30,
1995 and the year ended October 31, 1994 were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ------------------------------ ----------- -------------
<S> <C> <C>
Six months ended
April 30, 1995:
Shares sold................... 754,368 $ 6,127,022
Shares issued in reinvestment
of
dividends and
distributions............... 52,804 435,218
Shares reacquired............. (2,433,145) (20,204,154)
----------- -------------
Net decrease in shares
outstanding before
conversion.................. (1,625,973) (13,641,914)
Shares issued upon conversion
from Class B................ 615,866 5,109,638
----------- -------------
Net decrease in shares
outstanding................. (1,010,107) $ (8,532,276)
----------- -------------
----------- -------------
Year ended October 31, 1994:
Shares sold................... 551,897 $ 4,763,324
Shares issued in reinvestment
of
dividends and
distributions............... 194,713 1,743,925
Shares reacquired............. (3,776,033) (34,191,806)
----------- -------------
Net decrease in shares
outstanding................. (3,029,423) $ (27,684,557)
----------- -------------
----------- -------------
<CAPTION>
Class B Shares Amount
- ------------------------------ ----------- -------------
<S> <C> <C>
Six months ended
April 30, 1995:
Shares sold................... 135,676 $ 1,142,480
Shares issued in reinvestment
of
dividends and
distributions............... 338,189 2,829,669
Shares reacquired............. (6,032,300) (50,604,879)
----------- -------------
Net decrease in shares
outstanding before
conversion.................. (5,558,435) (46,632,730)
Shares reacquired upon
conversion into Class A..... (614,385) (5,109,638)
----------- -------------
Net decrease in shares
outstanding................. (6,172,820) $ (51,742,368)
----------- -------------
----------- -------------
Year ended October 31, 1994:
Shares sold................... 710,218 $ 6,441,757
Shares issued in reinvestment
of
dividends and
distributions............... 1,001,413 8,959,370
Shares reacquired............. (20,015,210) (178,976,707)
----------- -------------
Net decrease in shares
outstanding................. (18,303,579) $(163,575,580)
----------- -------------
----------- -------------
<CAPTION>
Class C
- ------------------------------
<S> <C> <C>
Six months ended
April 30, 1995:
Shares sold................... 664 $ 5,518
Shares issued in reinvestment
of dividends and
distributions............... 3 25
----------- -------------
Net increase in shares
outstanding................. 667 $ 5,543
----------- -------------
----------- -------------
August 1, 1994* through
October 31, 1994:
Shares sold................... 23 $ 200
----------- -------------
Increase in shares
outstanding................. 23 $ 200
----------- -------------
----------- -------------
</TABLE>
- ---------------
* Commencement of offering of Class C shares.
-13-
<PAGE>
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Financial Highlights
(Unaudited)
<TABLE>
<CAPTION>
Class A
- -----------------------------------------------------------
Six
Months
Ended Year Ended October
31,
April 30,
- ---------------------------------------------
1995 1994 1993 1992
1991
--------- ------- -------
- -------- --------
<S> <C> <C> <C> <C>
<C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning of
period....................... $ 8.56 $ 9.29 $ 9.16 $
9.97 $ 10.00
--------- ------- -------
- -------- --------
Income from investment
operations
Net investment income.......... .30 .70 .97
.96 1.03
Net realized and unrealized
gain (loss) on investment and
foreign currency
transactions................. (.25) (.86) (.26)
(.95) (.02)
--------- ------- -------
- -------- --------
Total from investment
operations................. .05 (.16) .71
.01 1.01
--------- ------- -------
- -------- --------
Less distributions
Dividends from net investment
income....................... (.28) -- (.58)
(.82) (1.03)
Tax return of capital
distributions................ -- (.57) --
- -- --
Distributions from net capital
gains........................ -- -- --
- -- (.01)
--------- ------- -------
- -------- --------
Total distributions.......... (.28) (.57) (.58)
(.82) (1.04)
--------- ------- -------
- -------- --------
Net asset value, end of
period....................... $ 8.33 $ 8.56 $ 9.29 $
9.16 $ 9.97
--------- ------- -------
- -------- --------
--------- ------- -------
- -------- --------
TOTAL RETURN#:................. 0.68% (1.89)% 7.96%
(0.07)% 10.41%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000)........................ $19,665 $28,841 $59,458
$101,358 $105,148
Average net assets (000)....... $21,284 $38,000 $70,347
$119,171 $51,830
Ratios to average net assets:
Expenses, including
distribution fees.......... 1.36%* 1.17% 1.02%
1.08% 1.01%
Expenses, excluding
distribution fees.......... 1.21%* 1.02% .87%
.93% .86%
Net investment income........ 7.14%* 7.67% 10.81%
9.93% 10.23%
Portfolio turnover rate........ 110% 232% 307%
180% 66%
</TABLE>
- ---------------
* Annualized.
# Total return does not consider the effects of sales loads. Total
return is calculated assuming a purchase of shares on the first
day and a sale on the last day of each period reported and
includes reinvestment of dividends and distributions. Total
returns for periods of less than a full year are not annualized.
See Notes to Financial Statements.
-14-
<PAGE>
PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
SHORT-TERM GLOBAL INCOME PORTFOLIO
Financial Highlights
(Unaudited)
<TABLE>
<CAPTION>
Class B
Class C
- ----------------------------------------------------------------
- --------------------
Six August 1,
Six Months
Months 1994D
Ended Year Ended October 31,
Ended Through
April 30,
- ----------------------------------------------- April 30, October 31,
1995 1994 1993 1992
1991 1995 1994
------------ -------- -------- --------
-------- ------ --------
<S> <C> <C> <C> <C>
<C> <C> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value,
beginning of period.... $ 8.56 $ 9.29 $ 9.16 $ 9.97
$ 10.00 $ 8.56 $ 8.61
------------ -------- -------- --------
-------- ------ --------
Income from investment
operations
Net investment income.... .27 .62 .88 .88
.95 .27 .14
Net realized and
unrealized gain (loss)
on investment and
foreign currency
transactions........... (.21) (.86) (.26)
(.95) (.02) (.21) (.06)
------------ -------- -------- --------
-------- ------ --------
Total from investment
operations........... .06 (.24) .62
(.07) .93 .06 .08
------------ -------- -------- --------
-------- ------ --------
Less distributions
Dividends from net
investment
income................. (.26) -- (.49)
(.74) (.95) (.26) --
Tax return of capital
distributions.......... -- (.49) --
- -- -- -- (.13)
Distributions from net
capital gains.......... -- -- --
- -- (.01) -- --
------------ -------- -------- --------
-------- ------ --------
Total distributions.... (.26) (.49) (.49)
(.74) (.96) (.26) (.13)
------------ -------- -------- --------
-------- ------ --------
Net asset value, end of
period................. $ 8.36 $ 8.56 $ 9.29 $ 9.16
$ 9.97 $ 8.36 $ 8.56
------------ -------- -------- --------
-------- ------ --------
------------ -------- -------- --------
-------- ------ --------
TOTAL RETURN#:........... 0.72% (2.62)% 7.00%
(0.86)% 9.51% 0.72% 0.75%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000).................. $132,969 $188,966 $375,013 $606,899
$669,086 $5,767@ $200@
Average net assets
(000).................. $158,586 $281,143 $474,175 $814,734
$349,607 $1,161@ $199@
Ratios to average net
assets:
Expenses, including
distribution fees.... 1.96%* 1.97% 1.87%
1.93% 1.87% 1.78%* .93%*
Expenses, excluding
distribution fees.... 1.21%* 1.02% .87%
.93% .87% 1.03%* .18%*
Net investment
income............... 6.51%* 6.82% 9.42%
9.05% 9.46% 6.72%* 7.02%*
Portfolio turnover
rate................... 110% 232% 307%
180% 66% 110% 232%
</TABLE>
- ---------------
* Annualized.
D Commencement of offering of Class C shares.
@ Figures are actual and not rounded to the nearest thousand.
# Total return does not consider the effects of sales loads. Total
return is calculated assuming a purchase of shares on the first
day and a sale on the last day of each period reported and
includes reinvestment of dividends and distributions. Total
returns for periods of less than a full year are not annualized.
See Notes to Financial Statements.
-15-
<PAGE>
<PAGE>
Directors
Stephen C. Eyre
Delayne Dedrick Gold
Don G. Hoff
Harry A. Jacobs, Jr.
Sidney R. Knafel
Robert E. La Blanc
Thomas A. Owens, Jr.
Richard A. Redeker
Clay T. Whitehead
Officers
Richard A. Redeker, President
Robert F. Gunia, Vice President
Grace Torres, Treasurer
Stephen M. Ungerman, Asst. Treasurer
S. Jane Rose, Secretary
Ellyn C. Acker, Asst. Secretary
Manager
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, NY 10292
Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07101
Distributors
Prudential Mutual Fund Distributors, Inc.
Prudential Securities Incorporated
One Seaport PlazaNew York, NY 10292
Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
Transfer Agent
Prudential Mutual Fund Services, Inc.
P.O. Box 15005
New Brunswick, NJ 08906
Independent Accountants
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281
Legal Counsel
Shereff, Friedman, Hoffman & Goodman
919 Third Avenue
New York, NY 10022
Prudential Mutual Funds
One Seaport Plaza
New York, NY 10292
Toll Free (800) 225-1852, Collect (908) 417-7555
The accompanying financial statements as of April 30, 1995 were
not audited and, accordingly, no opinion is expressed on them.
This report is not authorized for distribution to prospective
investors unless preceded or accompanied by a current prospectus.
74436H101
74436H200 MF 144E2
74436H507 (LOGO) Cat #4443640
