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EXHIBIT P.(1)
CODE OF ETHICS
THE LEGENDS FUND, INC.
The Legends Fund, Inc. (the"Company") has adopted this Code of
Ethics effective as of September 1, 2000, in accordance with the provisions
of Rule 17j-1 under the Investment Company Act of 1940, as amended (the "1940
Act").
Rule 17j-1 under the 1940 Act generally prohibits deceitful,
fraudulent or manipulative practices with respect to purchases or sales of
securities held or to be acquired by investment companies. While this Code is
designed to prevent violations of Rule 17j-1, it is possible to comply with
the terms of this Code and nevertheless violate the general prohibitions set
forth in Rule 17j-1. Those persons subject to this Code should, therefore,
bear these general prohibitions in mind at all times.
A. GENERAL STANDARDS OF ETHICAL CONDUCT
Directors, officers and other Access Persons (as defined in this
Code) have a duty at all times to place the interests of the Company ahead of
their own interests.
All personal securities transactions of these individuals must be
conducted in compliance with this Code and in a manner that avoids any actual
or potential conflict of interest or any abuse of the individual's position
of trust and responsibility to the Company.
All activities of these individuals also must be conducted in
accordance with the fundamental standard that they may not take any
inappropriate advantage of their positions with the Company.
B. STANDARDS OF CONDUCT FOR ACCESS PERSONS
NOTE: ACCESS PERSONS INCLUDES, AMONG OTHERS, BOTH ADVISORY PERSONS
AND INVESTMENT PERSONS.
1. PROHIBITED PURCHASES AND SALES WHEN A PORTFOLIO TRADE IS PENDING
a. PROHIBITION
If an Access Person knows that a Portfolio has placed a "buy"
or "sell" order in a Covered Security on a particular day, the
Access Person may not purchase or sell, directly or indirectly,
the Covered Security or a Related Security on the same day if:
- the Access Person has any direct or indirect
beneficial ownership in the Covered Security or a
Related Security or
- the Access Person will acquire any direct or indirect
beneficial ownership in the Covered Security or a Related
Security by reason of the purchase.
b. EXCEPTIONS
This prohibition does not apply to:
- purchases or sales involving 500 or fewer shares of
a Covered Security that is included in the Standard &
Poor's 500
- purchases or sales effected in any account over
which the Access Person has no direct or indirect
influence or control
- purchases or sales that are non-volitional on the
part of the Access Person
- purchases that are part of an automatic dividend
reinvestment plan
- sales that are part of an automatic withdrawal plan
- purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of a class
of its securities to the extent the rights were
acquired from the issuer
- sales of rights issued by an issuer pro rata to all
holders of a class of its securities to the extent the
rights were acquired from the issuer or
- purchases or sales that the Compliance Officer
approves in writing before the purchase or sale
c. APPROVAL BY THE COMPLIANCE OFFICER
To obtain approval for a specific transaction, an Access
Person should contact the Compliance Officer. The Access Person
must disclose to the Compliance Officer all factors potentially
relevant to a conflict of interest analysis that the Access Person
is aware of, including the existence of any substantial economic
relationship between his or her transaction and the Portfolio's
transaction.
Generally the Compliance Officer will approve a transaction
only if:
- the transaction is only remotely potentially harmful
to the Portfolio because it would be very unlikely to
affect a highly institutional market
- the transaction is clearly not economically related
to the securities to be purchased or sold by the
Portfolio or
- the transaction is unlikely to result in any of the
abuses described in Rule 17j-1.
2. CONFIDENTIALITY
An Access Person may not reveal to any other person (except in the
normal course of his or her duties on behalf of the Company) any
information about securities transactions of a Portfolio or securities
under consideration for purchase or sale by a Portfolio.
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C. STANDARDS OF CONDUCT FOR ADVISORY PERSONS
NOTE: ADVISORY PERSONS INCLUDES INVESTMENT PERSONS.
1. RESTRICTIONS ON SERVING ON BOARDS OF DIRECTORS
An Advisory Person may not serve on the board of directors of a
publicly traded company without prior approval from the Compliance
Officer.
2. RESTRICTIONS INVOLVING GIFTS
An Advisory Person may not accept in any calendar year gifts with
a value of more than $100 from any person that does business with a
Portfolio.
This prohibition shall not apply to:
- an occasional breakfast, lunch, dinner or reception,
ticket to a sporting event or the theater, or comparable
entertainment that is not so frequent, so costly nor so
extensive as to raise any question of impropriety
- a breakfast, lunch, dinner, reception or cocktail party
in conjunction with a bona fide business meeting or
- a gift approved in writing by the Compliance Officer
because the character or value of the gift would not raise
any question of impropriety
D. STANDARDS OF CONDUCT FOR INVESTMENT PERSONS
1. PROHIBITED PURCHASES AND SALES WITHIN 3 TRADING DAYS OF A
PORTFOLIO TRADE
a. PROHIBITION
If the Portfolio for which an Investment Person acts as
portfolio manager has executed a trade in a Covered Security, the
Investment Person may not purchase or sell, directly or
indirectly, the Covered Security or a Related Security within 3
trading days before or after the Portfolio's trade if:
- the Investment Person has any direct or indirect
beneficial ownership in the Covered Security or a
Related Security or
- the Investment Person will acquire any direct or
indirect beneficial ownership in the Covered Security
or a Related Security by reason of the purchase.
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b. EXCEPTIONS
This prohibition does not apply to:
- purchases or sales involving 500 or fewer shares of
a Covered Security that is included in the Standard &
Poor's 500
- purchases or sales effected in any account over
which the Investment Person has no direct or indirect
influence or control
- purchases or sales that are non-volitional on the
part of the Investment Person
- purchases that are part of an automatic dividend
reinvestment plan
- sales that are part of an automatic withdrawal plan
- purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of a class
of its securities to the extent the rights were
acquired from the issuer
- sales of rights issued by an issuer pro rata to all
holders of a class of its securities to the extent the
rights were acquired from the issuer or
- purchases or sales that the Compliance Officer
approves in writing before the purchase or sale
c. APPROVAL BY THE COMPLIANCE OFFICER
To obtain approval for a specific transaction, an Investment
Person should contact the Compliance Officer. The Investment
Person must disclose to the Compliance Officer all factors
potentially relevant to a conflict of interest analysis that the
Investment Person is aware of, including the existence of any
substantial economic relationship between his or her transaction
and the Portfolio's transaction.
Generally the Compliance Officer will approve a transaction
only if:
- the transaction is only remotely potentially harmful
to the Portfolio because it would be very unlikely to
affect a highly institutional market
- the transaction is clearly not economically related
to the securities to be purchased or sold by the
Portfolio or
- the transaction is unlikely to result in any of the
abuses described in Rule 17j-1.
2. TRANSACTIONS REQUIRING PRE-CLEARANCE
a. IPOS
An Investment Person may not acquire, directly or indirectly,
beneficial ownership in any security in an Initial Public Offering
without express prior approval from the Compliance Officer.
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b. LIMITED OFFERINGS
An Investment Person may not acquire, directly or indirectly,
beneficial ownership in any security in a Limited Offering without
express prior approval from the Compliance Officer. The Investment
Person must disclose his or her investment in the security if he
or she takes part in any subsequent decision to invest in any
security of the same issuer on behalf of any Portfolio for which
the Investment Person acts as portfolio manager.
E. REPORTING
NOTE: THE REPORTING REQUIREMENTS DESCRIBED IN THIS SECTION APPLY TO
ACCESS PERSONS, WHICH INCLUDES ADVISORY PERSONS AND INVESTMENT PERSONS.
1. DUPLICATE CONFIRMATIONS AND STATEMENTS
Each Access Person, other than a Disinterested Director, must
arrange for duplicate copies of broker trade confirmations and
periodic statements of his or her brokerage accounts to be sent to
the Compliance Officer.
2. HOLDINGS REPORTS
a. WHAT INFORMATION MUST BE INCLUDED IN A HOLDINGS REPORTS?
Each Access Person must submit written and signed reports
containing information about each Covered Security in which the
Access Person had any direct or indirect beneficial ownership
("Holdings Reports").
Each Holdings Report must include the following information:
- title of each Covered Security in which the Access
Person had any direct or indirect beneficial ownership
- number of shares and/or principal amount of each
Covered Security in which the Access Person had any
direct or indirect beneficial ownership
- name of any broker, dealer or bank with whom the
Access Person maintained an account in which any
securities were held for the direct or indirect benefit
of the Access Person and
- date the Holdings Report is submitted by the Access
Person
If an Access Person is not required to report any information
on a Holdings Report, the Access Person must submit a written and
signed statement to that effect to the Compliance Officer by the
date on which the Holdings Report is due.
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b. WHEN MUST AN ACCESS PERSON SUBMIT AN INITIAL HOLDINGS REPORT?
Each Access Person must submit to the Compliance Officer an
Initial Holdings Report no later than 10 days after he or she
becomes an Access Person. The information included in the Initial
Holdings Report must reflect the Access Person's holdings as of
the date he or she became an Access Person.
c. WHEN MUST AN ACCESS PERSON SUBMIT ANNUAL HOLDINGS REPORTS?
Each Access Person must submit to the Compliance Officer an
Annual Holdings Report no later than January 30 of each year. The
information included in the Annual Holdings Report must reflect
the Access Person's holdings as of the immediately preceding
December 31.
d. ARE THERE ANY EXCEPTIONS TO THESE REPORTING REQUIREMENTS?
- EXCEPTIONS FOR CERTAIN SECURITIES AND ACCOUNTS
An Access Person does not have to include in his or her
Holdings Reports information about the following securities
or accounts:
- direct obligations of the government of the
United States
- bankers' acceptances
- bank certificates of deposit
- commercial paper
- high quality short-term debt instruments
including repurchase agreements
- shares issued by open-end Funds
- securities held in any account over which the
Access Person has no direct or indirect influence
or control and
- transactions effected for any account over
which the Access Person has no direct or indirect
influence or control
If an Access Person does not make a Holdings Report because
of this exception, the Access Person must submit a written
and signed statement to that effect to the Compliance
Officer by the date on which the Holdings Report is due.
- EXCEPTIONS FOR DISINTERESTED DIRECTORS
A Disinterested Director does not have to make an Initial
Holdings Report or an Annual Holdings Report.
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2. QUARTERLY TRANSACTION REPORTS
a. WHAT INFORMATION MUST BE INCLUDED IN A QUARTERLY
TRANSACTION REPORT?
Each Access Person must submit a report ("Quarterly
Transaction Report") containing information about:
- every transaction in a Covered Security during the
quarter and in which the Access Person had any direct
or indirect beneficial ownership and
- every account established by the Access Person in
which any securities were held during the quarter for
the direct or indirect benefit of the Access Person.
A Quarterly Transaction Report must include the following
information:
- date of each transaction in a Covered Security
- title of the Covered Security
- interest rate and maturity date of the Covered
Security, if applicable
- number of shares and/or principal amount of the
Covered Security
- nature of the transaction
- price of the Covered Security at which the
transaction was effected
- name of the broker, dealer or bank with or through
which the transaction was effected
- name of the broker, dealer or bank with whom the
Access Person established any new account
- date the account was established and
- date the Quarterly Transaction Report is submitted
by the Access Person
If an Access Person is not required to report any information
on a Quarterly Transaction Report, the Access Person must submit a
written and signed statement to that effect to the Compliance
Officer no later than 10 days after the end of the calendar
quarter.
b. WHEN MUST AN ACCESS PERSON SUBMIT A QUARTERLY TRANSACTION
REPORT?
A Quarterly Transaction Report must be submitted to the
Compliance Officer no later than 10 days after the end of each
calendar quarter.
c. ARE THERE ANY EXCEPTIONS TO THESE REQUIREMENTS?
- EXCEPTIONS FOR CERTAIN SECURITIES AND ACCOUNTS
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An Access Person does not have to report transactions
involving the following securities or accounts:
- direct obligations of the government of the
United States
- bankers' acceptances
- bank certificates of deposit
- commercial paper
- high quality short-term debt instruments
including repurchase agreements
- shares issued by open-end Funds
- securities held in any account over which the
Access Person has no direct or indirect influence
or control and
- transactions effected for any account over
which the Access Person has no direct or indirect
influence or control
If an Access Person does not make a Quarterly Transaction
Report because of this exception, the Access Person must
submit a written and signed statement to that effect to
the Compliance Officer no later than 10 days after the end
of the calendar quarter.
- EXCEPTIONS BASED ON DUPLICATE CONFIRMATIONS
In addition, an Access Person does not have to make a
Quarterly Transaction Report for a calendar quarter if:
- the report would duplicate information
contained in broker trade confirmations or account
statements received by the Compliance Officer no
later than 10 days after the end of the calendar
quarter and
- all of the required information is contained in
the broker trade confirmations or account
statements.
If broker trade confirmations do not contain all of the
required information, the Access Person must include the
missing information in a Quarterly Transaction Report.
If an Access Person does not make a Quarterly Transaction
Report because of this exception, the Access Person must
submit a written and signed statement to that effect to
the Compliance Officer no later than 10 days after the end
of the calendar quarter.
- EXCEPTIONS FOR DISINTERESTED DIRECTORS
A Disinterested Director does not have to make a Quarterly
Transaction Report unless the Disinterested Director knew
or, in the ordinary course of fulfilling his or her
official duties as a Director of the Company, should have
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known that during the 15-day period immediately before or
after the Disinterested Director's transaction in a
Covered Security, a Portfolio purchased or sold the
Covered Security, or the Portfolio or its investment
adviser considered purchasing or selling the Covered
Security.
F. COMPLIANCE OFFICER REVIEWS
In reviewing transactions, the Compliance Officer will take into
account the various exceptions included in this Code. Before making a
determination that an Access Person has violated this Code, the Compliance
Officer will give the Access Person an opportunity to supply additional
information about the transaction in question.
G. SANCTIONS
The Board of Directors of the Company may impose sanctions on an
Access Person for violations of this Code as it deems appropriate. Sanctions
could include disgorgement of any profits realized by the Access Person as a
result of the violation, a letter of censure or suspension in the Access
Person's personnel file, or termination of the employment of the Access
Person.
H. MISCELLANEOUS
A person need not make reports under this Code if he or she is
obligated to make similar reports to Touchstone Advisors, Inc.
All reports of securities transactions and any other information
reported pursuant to this Code will be treated as confidential.
The Board of Directors of the Company may from time to time adopt
interpretations of this Code as it deems appropriate.
I. DEFINITIONS
"Access Person" means
- any Director of the Company
- any officer of the Company or
- any Advisory Person (as defined below) of the Company
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"Advisory Person" means
- any employee of the Company (or of any company in a control
relationship to the Company) who, in connection with his or her
regular functions or duties, makes, participates in or obtains
information regarding the purchase or sale of Covered Securities
by a Portfolio
- any employee of the Company (or of any company in a control
relationship to the Company) whose functions relate to the making
of any recommendations with respect to purchases or sales of
Covered Securities by a Portfolio or
- any natural person in a control relationship with the
Company who obtains information regarding recommendations made
to a Portfolio with regard to the purchase or sale of Covered
Securities by a Portfolio
"Beneficial Ownership" is interpreted in the same manner as it would be
under Rule 16a-1(a)(2) promulgated under the Securities Exchange Act of
1934.
"Control" has the same meaning as in Section 2(a)(9) of the 1940 Act.
"Covered Security" means a security as defined in Section 2(a)(36) of
the 1940 Act (in effect, all securities), except that it does not
include:
- direct obligations of the government of the United States
- bankers' acceptances
- bank certificates of deposit
- commercial paper
- high quality short-term debt instruments, including
repurchase agreements and
- shares issued by open-end Funds
"Disinterested Director" means a Director of the Company who is not an
"interested person" of the Company within the meaning of Section
2(a)(19) of the 1940 and who would be required to make a report under
this Code solely by reason of being a Director.
"Fund" means an investment company registered under the 1940 Act.
"Initial Public Offering" means an offering of securities registered
under the Securities Act of 1933 (the "1933 Act"), the issuer of which,
immediately before the registration, was not subject to the reporting
requirements of Sections 13 or 15(d) of the Securities Exchange Act of
1934.
"Investment Person" means
- any employee of the Company (or of any company in a control
relationship to the Company) who, in connection with his or her
regular functions of duties, makes or participates in making
recommendations regarding the purchase or sale of securities by
a Portfolio or
- any natural person who controls the Company and who obtains
information concerning recommendations made to a Portfolio
regarding the purchase or sale of securities by a Portfolio
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"Limited Offering" means an offering that is exempt from registration
under the Securities Act of 1933 pursuant to Section 4(2) or Section
4(6), or pursuant to Rule 504, Rule 505, or Rule 506 under the
Securities Act of 1933.
"Portfolio" means any series of the Company.
"Purchase or sale of Covered Securities" includes, among other things,
the writing of an option to purchase or sell Covered Securities.
"Related Security" means:
- a security issued by the same issuer that issued the Covered
Security
- a security issued by an issuer under common control with the
issuer that issued the Covered Security or
- a security that gives the holder any contractual right with
respect to the Covered Security, including options, warrants or
other convertible securities
"Compliance Officer " means any person designated by the Company to
administer this Code or to review reports required by this Code.
