UNITEDSTATES
SECURITIESANDEXCHANGECOMMISSION
Washington,D.C.20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: | 811-03981 |
Exact name of registrant as specified in charter: | Prudential World Fund, Inc. |
Address of principal executive offices: | 655 Broad Street, 17th Floor |
| Newark, New Jersey 07102 |
Name and address of agent for service: | Andrew R. French |
| 655 Broad Street, 17th Floor |
| Newark, New Jersey 07102 |
Registrant's telephone number, including area code: | 800-225-1852 |
Date of fiscal year end: | 10/31/2020 |
Date of reporting period: | 4/30/2020 |
Item 1 – Reports to Stockholders
PGIM QMA INTERNATIONAL EQUITY FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
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This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC, a Prudential Financial company, member SIPC. QMA is the primary business name of QMA LLC, a wholly owned subsidiary of PGIM, Inc. (PGIM), a Prudential Financial company. © 2020 Prudential Financial, Inc. and its related entities. PGIM and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
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Dear Shareholder:
We hope you find the semiannual report for PGIM QMA International Equity Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM QMA International Equity Fund
June 15, 2020
PGIM QMA International Equity Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
(without sales charges) Six Months* (%) | Average Annual Total Returns as of 4/30/20 (with sales charges) | |||||||||
One Year (%) | Five Years (%) | Ten Years (%) | Since Inception (%) | |||||||
Class A | –14.32 | –19.48 | –3.24 | 1.99 | — | |||||
Class B | –14.80 | –19.82 | –3.20 | 1.75 | — | |||||
Class C | –14.90 | –16.35 | –2.92 | 1.80 | — | |||||
Class Z | –14.09 | –14.32 | –1.78 | 2.88 | — | |||||
Class R6 | –14.03 | –14.15 | N/A | N/A | 1.51 (12/28/16) | |||||
MSCI All Country World Ex-US Index | ||||||||||
–13.22 | –11.51 | –0.17 | 2.89 | — |
Average Annual Total Returns as of 4/30/20 Since Inception (%) | ||
Class R6 (12/28/16) | ||
MSCI All Country World Ex-US Index | 2.72 |
*Not annualized
Source: PGIM Investments LLC and Lipper Inc.
Since Inception returns are provided for any share class with less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to the class’ inception date.
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The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class B* | Class C | Class Z | Class R6 | ||||||
Maximum initial sales charge | 5.50% of the public offering price | None | None | None | None | |||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 5.00% (Yr.1) 4.00% (Yr.2) 3.00% (Yr.3) 2.00% (Yr.4) 1.00% (Yr.5) 1.00% (Yr.6) 0.00% (Yr.7) | 1.00% on sales made within 12 months of purchase | None | None | |||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% | 1.00% | 1.00% | None | None |
*Class B shares are closed to all purchase activity and no additional Class B shares may be purchased or acquired except by exchange from Class B shares of another Fund or through reinvestment of dividends and/or capital gains. Effective on or about June 26, 2020, all issued and outstanding Class B shares will be automatically converted to Class A shares. See the supplement included with this shareholder report for details.
Benchmark Definitions
MSCI All Country World Ex-US Index—The Morgan Stanley Capital International All Country World ex-US Index (MSCI ACWI ex-US Index) is an unmanaged free float-adjusted market-capitalization-weighted index that is designed to measure the equity market performance of developed and emerging markets, excluding the US.
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
PGIM QMA International Equity Fund | 5 |
Your Fund’s Performance (continued)
Presentation of Fund Holdings as of 4/30/20
Ten Largest Holdings | Line of Business | Country | % of Net Assets | |||
Alibaba Group Holding Ltd., ADR | Internet & Direct Marketing Retail | China | 2.2% | |||
Roche Holding AG | Pharmaceuticals | Switzerland | 2.0% | |||
Novartis AG | Pharmaceuticals | Switzerland | 1.7% | |||
Samsung Electronics Co. Ltd. | Technology Hardware, Storage & Peripherals | South Korea | 1.6% | |||
Taiwan Semiconductor Manufacturing Co. Ltd. | Semiconductors & Semiconductor Equipment | Taiwan | 1.4% | |||
GlaxoSmithKline PLC | Pharmaceuticals | United Kingdom | 1.1% | |||
Sony Corp. | Household Durables | Japan | 1.1% | |||
Nestle SA | Food Products | Switzerland | 1.1% | |||
LVMH Moet Hennessy Louis Vuitton SE | Textiles, Apparel & Luxury Goods | France | 1.1% | |||
British American Tobacco PLC | Tobacco | United Kingdom | 1.0% |
Holdings reflect only long-term investments and are subject to change.
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As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the
PGIM QMA International Equity Fund | 7 |
Fees and Expenses (continued)
period and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM QMA International Equity Fund | Beginning Account Value November 1, 2019 | Ending Account April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 856.80 | 1.46 | % | $ | 6.74 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,017.60 | 1.46 | % | $ | 7.32 | ||||||||||
Class B | Actual | $ | 1,000.00 | $ | 852.00 | 2.53 | % | $ | 11.65 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,012.28 | 2.53 | % | $ | 12.66 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 851.00 | 2.71 | % | $ | 12.47 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,011.39 | 2.71 | % | $ | 13.55 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 859.10 | 1.08 | % | $ | 4.99 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.49 | 1.08 | % | $ | 5.42 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 859.70 | 0.78 | % | $ | 3.61 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.98 | 0.78 | % | $ | 3.92 |
*Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
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Schedule of Investments (unaudited)
as of April 30, 2020
Description | Shares | Value | ||||||
LONG-TERM INVESTMENTS 99.4% | ||||||||
COMMON STOCKS 97.2% | ||||||||
Australia 4.2% | ||||||||
Aristocrat Leisure Ltd. | 15,350 | $ | 251,727 | |||||
BHP Group Ltd. | 27,830 | 581,701 | ||||||
BHP Group PLC | 28,452 | 475,128 | ||||||
Coles Group Ltd. | 10,869 | 109,233 | ||||||
Coronado Global Resources, Inc., CDI, 144A | 147,468 | 113,678 | ||||||
Fortescue Metals Group Ltd. | 176,281 | 1,367,835 | ||||||
Macquarie Group Ltd. | 7,004 | 461,151 | ||||||
Magellan Financial Group Ltd. | 30,272 | 986,848 | ||||||
Rio Tinto Ltd. | 3,508 | 198,432 | ||||||
Rio Tinto PLC | 10,705 | 494,412 | ||||||
Santos Ltd. | 258,095 | 827,862 | ||||||
Wesfarmers Ltd. | 10,851 | 263,636 | ||||||
Woolworths Group Ltd. | 51,742 | 1,205,110 | ||||||
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7,336,753 | ||||||||
Austria 1.5% | ||||||||
ams AG* | 77,381 | 1,006,323 | ||||||
BAWAG Group AG, 144A | 16,295 | 555,137 | ||||||
OMV AG | 14,052 | 463,822 | ||||||
Telekom Austria AG | 28,765 | 202,273 | ||||||
Wienerberger AG | 23,821 | 446,419 | ||||||
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2,673,974 | ||||||||
Belgium 0.1% | ||||||||
Telenet Group Holding NV | 3,535 | 147,393 | ||||||
Brazil 1.5% | ||||||||
Banco do Brasil SA | 172,600 | 899,200 | ||||||
BB Seguridade Participacoes SA | 39,000 | 190,199 | ||||||
Cia de Saneamento do Parana, UTS | 54,900 | 260,472 | ||||||
Petroleo Brasileiro SA | 33,100 | 113,947 | ||||||
Qualicorp Consultoria e Corretora de Seguros SA | 150,700 | 726,632 | ||||||
WEG SA | 65,700 | 480,254 | ||||||
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2,670,704 | ||||||||
Canada 6.0% | ||||||||
Alimentation Couche-Tard, Inc. (Class B Stock) | 4,700 | 131,146 | ||||||
B2Gold Corp. | 28,400 | 143,637 | ||||||
Canadian Imperial Bank of Commerce | 2,900 | 171,840 | ||||||
Canadian Pacific Railway Ltd. | 5,300 | 1,204,575 |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Canada (cont’d.) | ||||||||
Cogeco Communications, Inc. | 8,000 | $ | 591,458 | |||||
Cogeco, Inc. | 4,400 | 271,248 | ||||||
Corus Entertainment, Inc. (Class B Stock) | 89,100 | 202,915 | ||||||
Kirkland Lake Gold Ltd. | 2,400 | 99,210 | ||||||
Magna International, Inc. | 23,600 | 919,619 | ||||||
Manulife Financial Corp. | 86,100 | 1,084,330 | ||||||
National Bank of Canada | 24,100 | 971,999 | ||||||
Power Corp. of Canada | 39,900 | 638,079 | ||||||
Quebecor, Inc. (Class B Stock) | 3,300 | 71,858 | ||||||
Restaurant Brands International, Inc. | 2,200 | 107,317 | ||||||
Shopify, Inc. (Class A Stock)* | 1,000 | 634,204 | ||||||
SmartCentres Real Estate Investment Trust, REIT | 29,200 | 447,246 | ||||||
Sun Life Financial, Inc. | 34,200 | 1,172,227 | ||||||
Suncor Energy, Inc. | 6,300 | 112,336 | ||||||
TC Energy Corp. | 28,800 | 1,325,427 | ||||||
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10,300,671 | ||||||||
Chile 0.5% | ||||||||
AES Gener SA | 1,902,787 | 280,370 | ||||||
Colbun SA | 1,752,740 | 257,169 | ||||||
Engie Energia Chile SA | 336,716 | 415,481 | ||||||
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953,020 | ||||||||
China 12.5% | ||||||||
Alibaba Group Holding Ltd., ADR* | 18,500 | 3,749,395 | ||||||
Anhui Conch Cement Co. Ltd. (Class H Stock) | 143,000 | 1,119,562 | ||||||
Bank of Beijing Co. Ltd. (Class A Stock) | 143,900 | 100,957 | ||||||
Bank of China Ltd. (Class H Stock) | 3,271,000 | 1,249,209 | ||||||
Bank of Communications Co. Ltd. (Class H Stock) | 1,627,000 | 1,032,269 | ||||||
Bank of Jiangsu Co. Ltd. (Class A Stock) | 83,400 | 71,109 | ||||||
Bank of Shanghai Co. Ltd. (Class A Stock) | 87,300 | 100,626 | ||||||
BOC Hong Kong Holdings Ltd. | 334,500 | 1,027,680 | ||||||
China Coal Energy Co. Ltd. (Class H Stock) | 1,167,000 | 312,023 | ||||||
China Life Insurance Co. Ltd. (Class H Stock) | 212,000 | 450,841 | ||||||
China Minsheng Banking Corp. Ltd. (Class H Stock) | 1,521,000 | 1,137,504 | ||||||
China National Building Material Co. Ltd. (Class H Stock) | 230,000 | 288,379 | ||||||
China National Chemical Engineering Co. Ltd. (Class A Stock) | 92,200 | 79,912 | ||||||
China Resources Cement Holdings Ltd. | 274,000 | 370,918 | ||||||
China State Construction Engineering Corp. Ltd. (Class A Stock) | 129,000 | 95,077 | ||||||
Chlitina Holding Ltd. | 19,000 | 125,262 | ||||||
CITIC Ltd. | 949,000 | 986,909 | ||||||
CNOOC Ltd. | 495,000 | 560,789 | ||||||
Country Garden Services Holdings Co. Ltd. | 164,000 | 752,660 |
See Notes to Financial Statements.
10 |
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
China (cont’d.) | ||||||||
Fujian Sunner Development Co. Ltd. (Class A Stock) | 30,700 | $ | 94,022 | |||||
Gemdale Corp. (Class A Stock) | 60,400 | 113,552 | ||||||
Gigadevice Semiconductor Beijing, Inc. (Class A Stock) | 1,700 | 66,533 | ||||||
Greenland Holdings Corp. Ltd. (Class A Stock) | 111,600 | 88,867 | ||||||
Hengan International Group Co. Ltd. | 10,500 | 93,293 | ||||||
Industrial & Commercial Bank of China Ltd. (Class H Stock) | 1,638,000 | 1,108,052 | ||||||
JD.com, Inc., ADR* | 6,700 | 288,770 | ||||||
JinkoSolar Holding Co. Ltd., ADR*(a) | 31,300 | 495,166 | ||||||
LONGi Green Energy Technology Co. Ltd. (Class A Stock) | 24,000 | 103,680 | ||||||
Luxshare Precision Industry Co. Ltd. (Class A Stock) | 15,800 | 103,909 | ||||||
Metallurgical Corp. of China Ltd. (Class H Stock) | 1,616,000 | 280,908 | ||||||
Nanjing Iron & Steel Co. Ltd. (Class A Stock)* | 232,500 | 104,536 | ||||||
NetEase, Inc., ADR | 3,000 | 1,034,880 | ||||||
New Hope Liuhe Co. Ltd. (Class A Stock) | 13,800 | 63,366 | ||||||
New Oriental Education & Technology Group, Inc., ADR* | 500 | 63,830 | ||||||
Poly Developments & Holdings Group Co. Ltd. (Class A Stock) | 53,900 | 122,816 | ||||||
Sany Heavy Industry Co. Ltd. (Class A Stock) | 35,500 | 98,262 | ||||||
Shanghai Pudong Development Bank Co. Ltd. (Class A Stock) | 67,200 | 100,480 | ||||||
Shanghai Yuyuan Tourist Mart Group Co. Ltd. (Class A Stock) | 83,600 | 89,748 | ||||||
Shenzhen Goodix Technology Co. Ltd. (Class A Stock) | 2,200 | 73,432 | ||||||
Shui On Land Ltd. | 1,656,000 | 292,638 | ||||||
Tencent Holdings Ltd. | 31,800 | 1,683,019 | ||||||
Weichai Power Co. Ltd. (Class H Stock) | 134,000 | 233,926 | ||||||
Wens Foodstuffs Group Co. Ltd. (Class A Stock) | 19,700 | 83,928 | ||||||
Wuhu Sanqi Interactive Entertainment Network Technology Group Co. Ltd. (Class A Stock) | 28,100 | 142,805 | ||||||
XCMG Construction Machinery Co. Ltd. (Class A Stock) | 151,300 | 118,408 | ||||||
Yum China Holdings, Inc. | 14,800 | 717,208 | ||||||
Zoomlion Heavy Industry Science & Technology Co. Ltd. (Class A Stock) | 119,000 | 107,423 | ||||||
|
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21,578,538 | ||||||||
Colombia 0.5% | ||||||||
Ecopetrol SA | 1,647,879 | 861,609 | ||||||
Denmark 0.4% | ||||||||
Carlsberg A/S (Class B Stock) | 540 | 68,022 | ||||||
Novo Nordisk A/S (Class B Stock) | 5,005 | 318,882 | ||||||
Scandinavian Tobacco Group A/S, 144A | 32,739 | 377,581 | ||||||
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764,485 |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Finland 0.3% | ||||||||
Kone OYJ (Class B Stock) | 3,070 | $ | 185,998 | |||||
Neste OYJ | 10,593 | 375,420 | ||||||
|
| |||||||
561,418 | ||||||||
France 5.5% | ||||||||
BNP Paribas SA | 32,796 | 1,037,421 | ||||||
Cie de Saint-Gobain | 23,862 | 632,960 | ||||||
Hermes International | 1,639 | 1,200,969 | ||||||
Klepierre SA, REIT | 33,891 | 685,040 | ||||||
Legrand SA | 15,512 | 1,046,563 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 4,697 | 1,830,960 | ||||||
Peugeot SA | 55,066 | 789,083 | ||||||
Publicis Groupe SA | 26,384 | 784,202 | ||||||
Sanofi | 13,898 | 1,362,329 | ||||||
TOTAL SA | 3,502 | 126,123 | ||||||
|
| |||||||
9,495,650 | ||||||||
Germany 4.3% | ||||||||
Allianz SE | 9,122 | 1,686,679 | ||||||
Bayer AG | 3,609 | 237,405 | ||||||
Deutsche Post AG | 24,625 | 732,454 | ||||||
Deutsche Telekom AG* | 32,914 | 479,808 | ||||||
Deutsche Wohnen SE | 17,976 | 728,868 | ||||||
Fresenius Medical Care AG & Co. KGaA | 2,093 | 164,292 | ||||||
Fresenius SE & Co. KGaA | 23,856 | 1,034,733 | ||||||
Henkel AG & Co. KGaA* | 1,391 | 108,221 | ||||||
Merck KGaA* | 9,697 | 1,124,846 | ||||||
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen | 3,129 | 688,136 | ||||||
SAP SE | 891 | 106,255 | ||||||
Varta AG*(a) | 4,305 | 357,119 | ||||||
|
| |||||||
7,448,816 | ||||||||
Greece 0.8% | ||||||||
Hellenic Telecommunications Organization SA | 58,810 | 774,329 | ||||||
JUMBO SA | 34,902 | 545,425 | ||||||
|
| |||||||
1,319,754 | ||||||||
Hong Kong 1.0% | ||||||||
AIA Group Ltd. | 13,400 | 123,927 | ||||||
Hong Kong Exchanges & Clearing Ltd. | 3,600 | 116,479 | ||||||
K Wah International Holdings Ltd. | 854,000 | 392,122 |
See Notes to Financial Statements.
12 |
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Hong Kong (cont’d.) | ||||||||
Shun Tak Holdings Ltd. | 1,408,000 | $ | 492,571 | |||||
Vinda International Holdings Ltd. | 126,000 | 376,420 | ||||||
WH Group Ltd., 144A | 190,500 | 183,709 | ||||||
|
| |||||||
1,685,228 | ||||||||
India 1.3% | ||||||||
Balkrishna Industries Ltd. | 25,463 | 314,599 | ||||||
Balrampur Chini Mills Ltd. | 262,161 | 346,016 | ||||||
GAIL India Ltd. | 618,731 | 783,782 | ||||||
HCL Technologies Ltd. | 30,120 | 216,665 | ||||||
Manappuram Finance Ltd. | 120,684 | 211,987 | ||||||
Polycab India Ltd. | 35,707 | 339,948 | ||||||
|
| |||||||
2,212,997 | ||||||||
Indonesia 0.0% | ||||||||
Japfa Comfeed Indonesia Tbk PT* | 1,365,200 | 89,187 | ||||||
Ireland 0.2% | ||||||||
CRH PLC | 7,635 | 231,132 | ||||||
Flutter Entertainment PLC | 747 | 91,135 | ||||||
|
| |||||||
322,267 | ||||||||
Israel 0.6% | ||||||||
Check Point Software Technologies Ltd.* | 10,400 | 1,099,696 | ||||||
Italy 1.4% | ||||||||
Buzzi Unicem SpA | 22,721 | 444,612 | ||||||
Enel SpA | 251,466 | 1,720,551 | ||||||
Ferrari NV | 1,146 | 180,359 | ||||||
|
| |||||||
2,345,522 | ||||||||
Japan 17.7% | ||||||||
77 Bank Ltd. (The) | 39,400 | 529,209 | ||||||
Advantest Corp. | 1,800 | 86,563 | ||||||
Astellas Pharma, Inc. | 90,100 | 1,489,876 | ||||||
Chubu Electric Power Co., Inc. | 36,700 | 497,057 | ||||||
Chugai Pharmaceutical Co. Ltd. | 3,600 | 428,106 | ||||||
Dai-ichi Life Holdings, Inc. | 9,700 | 122,336 | ||||||
EDION Corp. | 61,700 | 535,746 | ||||||
FUJIFILM Holdings Corp. | 3,500 | 166,095 | ||||||
Fujitsu Ltd. | 10,500 | 1,025,476 |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 13 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Japan (cont’d.) | ||||||||
Hikari Tsushin, Inc. | 500 | $ | 97,279 | |||||
Hitachi Ltd. | 37,500 | 1,120,252 | ||||||
ITOCHU Corp. | 56,700 | 1,113,224 | ||||||
Japan Petroleum Exploration Co. Ltd. | 14,600 | 251,571 | ||||||
Japan Post Holdings Co. Ltd. | 24,400 | 195,416 | ||||||
Japan Tobacco, Inc. | 60,700 | 1,134,258 | ||||||
Kansai Electric Power Co., Inc. (The) | 8,300 | 85,085 | ||||||
KDDI Corp. | 53,500 | 1,517,333 | ||||||
Kenedix, Inc. | 25,100 | 114,257 | ||||||
Kobayashi Pharmaceutical Co. Ltd. | 11,700 | 1,077,225 | ||||||
M3, Inc. | 2,300 | 82,881 | ||||||
Medipal Holdings Corp. | 45,600 | 882,509 | ||||||
Mitsubishi Estate Co. Ltd. | 60,300 | 983,460 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 348,600 | 1,403,454 | ||||||
MS&AD Insurance Group Holdings, Inc. | 7,400 | 213,143 | ||||||
NEC Corp. | 2,200 | 84,512 | ||||||
Nexon Co. Ltd. | 4,000 | 64,725 | ||||||
Nippon Building Fund, Inc., REIT | 12 | 71,768 | ||||||
Nippon Telegraph & Telephone Corp. | 58,068 | 1,316,857 | ||||||
Nomura Holdings, Inc. | 242,600 | 1,008,374 | ||||||
Nomura Real Estate Holdings, Inc. | 16,200 | 265,490 | ||||||
Nomura Research Institute Ltd. | 51,800 | 1,262,263 | ||||||
NTT DOCOMO, Inc. | 28,300 | 827,082 | ||||||
Obayashi Corp. | 93,600 | 823,074 | ||||||
Otsuka Corp. | 15,800 | 708,393 | ||||||
Otsuka Holdings Co. Ltd. | 3,700 | 145,662 | ||||||
Pan Pacific International Holdings Corp. | 22,100 | 426,650 | ||||||
Recruit Holdings Co. Ltd. | 42,800 | 1,253,775 | ||||||
Secom Co. Ltd. | 5,800 | 484,640 | ||||||
Sekisui House Ltd. | 5,800 | 99,787 | ||||||
Shimizu Corp. | 9,500 | 73,312 | ||||||
Shionogi & Co. Ltd. | 13,400 | 736,659 | ||||||
Softbank Corp. | 46,700 | 636,411 | ||||||
Sony Corp. | 30,400 | 1,960,566 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 39,800 | 1,048,125 | ||||||
Tokuyama Corp. | 19,600 | 414,890 | ||||||
Tokyo Electron Ltd. | 3,000 | 634,215 | ||||||
Toyota Motor Corp. | 5,733 | 354,595 | ||||||
West Japan Railway Co. | 13,400 | 827,065 | ||||||
|
| |||||||
30,680,701 | ||||||||
Jordan 0.4% | ||||||||
Hikma Pharmaceuticals PLC | 20,865 | 621,983 |
See Notes to Financial Statements.
14 |
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Luxembourg 0.2% | ||||||||
ArcelorMittal SA | 39,039 | $ | 428,899 | |||||
Malaysia 0.1% | ||||||||
MMC Corp. Bhd | 640,200 | 102,359 | ||||||
Mexico 0.6% | ||||||||
America Movil SAB de CV (Class L Stock) | 1,044,300 | 630,887 | ||||||
Concentradora Fibra Danhos SA de CV, REIT | 129,649 | 100,541 | ||||||
Fibra Uno Administracion SA de CV, REIT | 238,800 | 198,265 | ||||||
Wal-Mart de Mexico SAB de CV | 50,800 | 122,611 | ||||||
|
| |||||||
1,052,304 | ||||||||
Netherlands 1.7% | ||||||||
ASM International NV | 2,554 | 279,390 | ||||||
ASML Holding NV | 329 | 96,318 | ||||||
Koninklijke Ahold Delhaize NV | 57,068 | 1,389,756 | ||||||
Royal Dutch Shell PLC (Class A Stock) | 38,290 | 638,513 | ||||||
Wolters Kluwer NV | 7,503 | 554,382 | ||||||
|
| |||||||
2,958,359 | ||||||||
New Zealand 0.1% | ||||||||
Fisher & Paykel Healthcare Corp. Ltd. | 5,866 | 97,778 | ||||||
Norway 0.6% | ||||||||
DNB ASA | 83,180 | 1,008,062 | ||||||
Pakistan 0.7% | ||||||||
Engro Corp. Ltd. | 227,200 | 437,924 | ||||||
Engro Fertilizers Ltd. | 643,000 | 246,231 | ||||||
Fauji Fertilizer Co. Ltd. | 536,500 | 369,986 | ||||||
Oil & Gas Development Co. Ltd. | 209,200 | 135,745 | ||||||
|
| |||||||
1,189,886 | ||||||||
Philippines 0.4% | ||||||||
Globe Telecom, Inc. | 4,730 | 205,750 | ||||||
PLDT, Inc. | 19,475 | 500,723 | ||||||
|
| |||||||
706,473 |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 15 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Poland 0.2% | ||||||||
Asseco Poland SA | 15,416 | $ | 248,827 | |||||
KGHM Polska Miedz SA* | 6,040 | 112,176 | ||||||
|
| |||||||
361,003 | ||||||||
Qatar 0.5% | ||||||||
Masraf Al Rayan QSC | 852,720 | 892,058 | ||||||
Russia 1.2% | ||||||||
Gazprom PJSC, ADR(a) | 102,260 | 516,398 | ||||||
LUKOIL PJSC | 1,128 | 70,837 | ||||||
LUKOIL PJSC, ADR | 9,253 | 608,494 | ||||||
MMC Norilsk Nickel PJSC, ADR | 5,788 | 159,418 | ||||||
Novatek PJSC, GDR | 3,536 | 500,327 | ||||||
Tatneft PJSC, ADR | 5,591 | 251,221 | ||||||
|
| |||||||
2,106,695 | ||||||||
Singapore 0.5% | ||||||||
Wilmar International Ltd. | 353,600 | 893,406 | ||||||
South Africa 2.0% | ||||||||
African Rainbow Minerals Ltd. | 23,913 | 175,783 | ||||||
Anglo American Platinum Ltd. | 18,185 | 957,699 | ||||||
Anglo American PLC | 60,058 | 1,070,753 | ||||||
Impala Platinum Holdings Ltd. | 92,031 | 557,699 | ||||||
Investec PLC | 55,164 | 113,828 | ||||||
Kumba Iron Ore Ltd. | 20,568 | 390,268 | ||||||
Momentum Metropolitan Holdings | 155,175 | 146,167 | ||||||
|
| |||||||
3,412,197 | ||||||||
South Korea 4.1% | ||||||||
BNK Financial Group, Inc. | 21,190 | 87,394 | ||||||
Hana Financial Group, Inc. | 42,845 | 973,587 | ||||||
Hyundai Mobis Co. Ltd. | 5,781 | 809,431 | ||||||
Kia Motors Corp. | 35,244 | 860,785 | ||||||
Korea Petrochemical Ind Co. Ltd. | 1,778 | 204,927 | ||||||
KT&G Corp. | 8,175 | 542,806 | ||||||
POSCO | 1,610 | 242,059 | ||||||
Samsung Electronics Co. Ltd. | 69,089 | 2,830,253 | ||||||
Shinhan Financial Group Co. Ltd. | 16,868 | 424,034 | ||||||
Taekwang Industrial Co. Ltd. | 181 | 118,402 | ||||||
|
| |||||||
7,093,678 |
See Notes to Financial Statements.
16 |
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Spain 2.0% | ||||||||
ACS Actividades de Construccion y Servicios SA | 29,383 | $ | 728,703 | |||||
Aena SME SA, 144A* | 5,800 | 733,604 | ||||||
Banco Bilbao Vizcaya Argentaria SA | 85,680 | 279,187 | ||||||
Iberdrola SA | 7,994 | 79,857 | ||||||
Industria de Diseno Textil SA | 32,967 | 839,322 | ||||||
Naturgy Energy Group SA | 41,790 | 735,878 | ||||||
|
| |||||||
3,396,551 | ||||||||
Sweden 2.8% | ||||||||
Atlas Copco AB (Class A Stock) | 33,422 | 1,152,178 | ||||||
Atlas Copco AB (Class B Stock) | 3,502 | 108,825 | ||||||
Essity AB (Class B Stock)* | 13,257 | 431,867 | ||||||
Evolution Gaming Group AB, 144A* | 20,310 | 928,991 | ||||||
Hennes & Mauritz AB (Class B Stock) | 34,896 | 486,422 | ||||||
Skandinaviska Enskilda Banken AB (Class A Stock) | 138,344 | 1,138,455 | ||||||
Volvo AB (Class B Stock)* | 42,817 | 553,826 | ||||||
|
| |||||||
4,800,564 | ||||||||
Switzerland 6.1% | ||||||||
ALSO Holding AG* | 1,126 | 232,068 | ||||||
Belimo Holding AG | 50 | 333,097 | ||||||
Chocoladefabriken Lindt & Spruengli AG | 1 | 83,583 | ||||||
Credit Suisse Group AG | 65,395 | 596,346 | ||||||
LafargeHolcim Ltd.* | 6,192 | 257,332 | ||||||
Nestle SA | 18,514 | 1,950,531 | ||||||
Novartis AG | 34,003 | 2,894,534 | ||||||
Roche Holding AG | 9,819 | 3,419,311 | ||||||
Swiss Life Holding AG | 1,116 | 395,194 | ||||||
Zurich Insurance Group AG | 985 | �� | 312,718 | |||||
|
| |||||||
10,474,714 | ||||||||
Taiwan 3.1% | ||||||||
Chicony Electronics Co. Ltd. | 105,000 | 297,361 | ||||||
Hon Hai Precision Industry Co. Ltd. | 478,000 | 1,235,131 | ||||||
Huaku Development Co. Ltd. | 42,000 | 128,782 | ||||||
International Games System Co. Ltd. | 40,000 | 749,534 | ||||||
Radiant Opto-Electronics Corp. | 150,000 | 494,720 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 236,000 | 2,390,820 | ||||||
Tripod Technology Corp. | 44,000 | 156,655 | ||||||
|
| |||||||
5,453,003 |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 17 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Turkey 1.1% | ||||||||
Anadolu Efes Biracilik Ve Malt Sanayii A/S | 158,531 | $ | 417,112 | |||||
Coca-Cola Icecek A/S | 107,736 | 568,793 | ||||||
Enerjisa Enerji A/S, 144A | 416,363 | 459,276 | ||||||
Haci Omer Sabanci Holding A/S | 91,514 | 107,314 | ||||||
Tekfen Holding A/S | 146,785 | 300,020 | ||||||
|
| |||||||
1,852,515 | ||||||||
United Kingdom 7.9% | ||||||||
3i Group PLC | 101,849 | 1,005,255 | ||||||
AstraZeneca PLC | 1,387 | 144,754 | ||||||
Berkeley Group Holdings PLC | 10,136 | 534,074 | ||||||
British American Tobacco PLC | 45,837 | 1,777,033 | ||||||
CK Hutchison Holdings Ltd. | 98,000 | 726,030 | ||||||
Dart Group PLC | 32,397 | 262,334 | ||||||
Dialog Semiconductor PLC* | 14,019 | 438,919 | ||||||
Fiat Chrysler Automobiles NV | 64,960 | 566,190 | ||||||
GlaxoSmithKline PLC | 94,512 | 1,969,727 | ||||||
Great Portland Estates PLC, REIT | 13,062 | 110,968 | ||||||
HSBC Holdings PLC | 26,119 | 134,719 | ||||||
Imperial Brands PLC | 49,831 | 1,049,608 | ||||||
J Sainsbury PLC | 43,767 | 109,007 | ||||||
JD Sports Fashion PLC | 66,953 | 446,467 | ||||||
Legal & General Group PLC | 438,760 | 1,130,624 | ||||||
Mitchells & Butlers PLC* | 49,461 | 110,898 | ||||||
Tate & Lyle PLC | 74,278 | 666,033 | ||||||
Tesco PLC | 91,806 | 271,834 | ||||||
Unilever NV | 32,810 | 1,633,460 | ||||||
Unilever PLC | 10,499 | 540,428 | ||||||
|
| |||||||
13,628,362 | ||||||||
United States 0.6% | ||||||||
Ferguson PLC | 13,825 | 995,900 | ||||||
QIAGEN NV* | 2,160 | 90,084 | ||||||
|
| |||||||
1,085,984 | ||||||||
|
| |||||||
TOTAL COMMON STOCKS | 168,165,216 | |||||||
|
| |||||||
EXCHANGE-TRADED FUNDS 1.2% | ||||||||
United States | ||||||||
iShares MSCI EAFE ETF | 25,700 | 1,453,849 |
See Notes to Financial Statements.
18 |
Description | Shares | Value | ||||||
EXCHANGE-TRADED FUNDS (Continued) | ||||||||
United States (cont’d.) | ||||||||
iShares MSCI Emerging Markets ETF(a) | 15,300 | $ | 560,592 | |||||
|
| |||||||
TOTAL EXCHANGE-TRADED FUNDS | 2,014,441 | |||||||
|
| |||||||
PREFERRED STOCKS 1.0% | ||||||||
Brazil 0.8% | ||||||||
Cia de Saneamento do Parana (PRFC) | 229,800 | 213,408 | ||||||
Cia Paranaense de Energia (PRFC) | 8,500 | 86,611 | ||||||
Petroleo Brasileiro SA (PRFC) | 303,700 | 1,008,629 | ||||||
|
| |||||||
1,308,648 | ||||||||
Germany 0.1% | ||||||||
Sartorius AG (PRFC) | 387 | 108,939 | ||||||
South Korea 0.1% | ||||||||
Samsung Electronics Co. Ltd. (PRFC) | 7,630 | 263,751 | ||||||
|
| |||||||
TOTAL PREFERRED STOCKS | 1,681,338 | |||||||
|
| |||||||
TOTAL LONG-TERM INVESTMENTS | 171,860,995 | |||||||
|
| |||||||
SHORT-TERM INVESTMENT 1.1% | ||||||||
AFFILIATED MUTUAL FUND | ||||||||
PGIM Institutional Money Market Fund | 1,989,564 | 1,989,166 | ||||||
|
| |||||||
TOTAL INVESTMENTS 100.5% | 173,850,161 | |||||||
Liabilities in excess of other assets (0.5)% | (873,797 | ) | ||||||
|
| |||||||
NET ASSETS 100.0% | $ | 172,976,364 | ||||||
|
|
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 19 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Below is a list of the abbreviation(s) used in the semiannual report:
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
ADR—American Depositary Receipt
CDI—Chess Depository Interest
EAFE—Europe, Australasia, Far East
ETF—Exchange-Traded Fund
GDR—Global Depositary Receipt
LIBOR—London Interbank Offered Rate
MSCI—Morgan Stanley Capital International
PJSC—Public Joint-Stock Company
PRFC—Preference Shares
REITs—Real Estate Investment Trust
UTS—Unit Trust Security
* | Non-income producing security. |
(a) | All or a portion of security is on loan. The aggregate market value of such securities, including those sold and pending settlement, is $1,874,685; cash collateral of $1,985,455 (included in liabilities) was received with which the Series purchased highly liquid short-term investments. |
(b) | Represents security, or portion thereof, purchased with cash collateral received for securities on loan and includes dividend reinvestment. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Institutional Money Market Fund. |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Common Stocks | ||||||||||||
Australia | $ | — | $ | 7,336,753 | $ | — | ||||||
Austria | — | 2,673,974 | — | |||||||||
Belgium | — | 147,393 | — | |||||||||
Brazil | 2,670,704 | — | — | |||||||||
Canada | 10,300,671 | — | — | |||||||||
Chile | 953,020 | — | — | |||||||||
China | 6,422,681 | 15,155,857 | — | |||||||||
Colombia | 861,609 | — | — | |||||||||
Denmark | — | 764,485 | — | |||||||||
Finland | — | 561,418 | — | |||||||||
France | — | 9,495,650 | — |
See Notes to Financial Statements.
20 |
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities (continued) | ||||||||||||
Assets (continued) | ||||||||||||
Common Stocks (continued) | ||||||||||||
Germany | $ | — | $ | 7,448,816 | $ | — | ||||||
Greece | — | 1,319,754 | — | |||||||||
Hong Kong | — | 1,685,228 | — | |||||||||
India | — | 2,212,997 | — | |||||||||
Indonesia | — | 89,187 | — | |||||||||
Ireland | — | 322,267 | — | |||||||||
Israel | 1,099,696 | — | — | |||||||||
Italy | — | 2,345,522 | — | |||||||||
Japan | — | 30,680,701 | — | |||||||||
Jordan | — | 621,983 | — | |||||||||
Luxembourg | — | 428,899 | — | |||||||||
Malaysia | — | 102,359 | — | |||||||||
Mexico | 1,052,304 | — | — | |||||||||
Netherlands | — | 2,958,359 | — | |||||||||
New Zealand | — | 97,778 | — | |||||||||
Norway | — | 1,008,062 | — | |||||||||
Pakistan | — | 1,189,886 | — | |||||||||
Philippines | — | 706,473 | — | |||||||||
Poland | — | 361,003 | — | |||||||||
Qatar | — | 892,058 | — | |||||||||
Russia | — | 2,106,695 | — | |||||||||
Singapore | — | 893,406 | — | |||||||||
South Africa | — | 3,412,197 | — | |||||||||
South Korea | — | 7,093,678 | — | |||||||||
Spain | — | 3,396,551 | — | |||||||||
Sweden | — | 4,800,564 | — | |||||||||
Switzerland | — | 10,474,714 | — | |||||||||
Taiwan | — | 5,453,003 | — | |||||||||
Turkey | — | 1,852,515 | — | |||||||||
United Kingdom | — | 13,628,362 | — | |||||||||
United States | — | 1,085,984 | — | |||||||||
Exchange-Traded Funds | ||||||||||||
United States | 2,014,441 | — | — | |||||||||
Preferred Stocks | ||||||||||||
Brazil | 1,308,648 | — | — | |||||||||
Germany | — | 108,939 | — | |||||||||
South Korea | — | 263,751 | — | |||||||||
Affiliated Mutual Fund | 1,989,166 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | 28,672,940 | $ | 145,177,221 | $ | — | ||||||
|
|
|
|
|
|
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 21 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Industry Classification:
The industry classification of investments and liabilities in excess of other assets shown as a percentage of net assets as of April 30, 2020 were as follows:
Banks | 10.3 | % | ||
Pharmaceuticals | 8.6 | |||
Oil, Gas & Consumable Fuels | 5.4 | |||
Insurance | 5.0 | |||
Metals & Mining | 4.4 | |||
Semiconductors & Semiconductor Equipment | 3.7 | |||
Tobacco | 2.8 | |||
Wireless Telecommunication Services | 2.6 | |||
Capital Markets | 2.6 | |||
Food Products | 2.4 | |||
Internet & Direct Marketing Retail | 2.4 | |||
IT Services | 2.2 | |||
Electric Utilities | 2.1 | |||
Food & Staples Retailing | 2.0 | |||
Real Estate Management & Development | 2.0 | |||
Technology Hardware, Storage & Peripherals | 1.9 | |||
Personal Products | 1.9 | |||
Construction Materials | 1.8 | |||
Specialty Retail | 1.8 | |||
Textiles, Apparel & Luxury Goods | 1.8 | |||
Diversified Telecommunication Services | 1.7 | |||
Electronic Equipment, Instruments & Components | 1.6 | |||
Health Care Providers & Services | 1.6 | |||
Machinery | 1.6 | |||
Automobiles | 1.5 | |||
Household Durables | 1.5 | |||
Construction & Engineering | 1.3 | |||
Electrical Equipment | 1.3 | |||
Hotels, Restaurants & Leisure | 1.3 | |||
Industrial Conglomerates | 1.3 | |||
Trading Companies & Distributors | 1.2 | |||
Auto Components | 1.2 | |||
Road & Rail | 1.2 | |||
Exchange-Traded Funds | 1.2 | |||
Entertainment | 1.1 |
Affiliated Mutual Fund (1.1% represents investments purchased with collateral from securities on loan) | 1.1 | % | ||
Media | 1.0 | |||
Professional Services | 1.0 | |||
Chemicals | 1.0 | |||
Interactive Media & Services | 1.0 | |||
Equity Real Estate Investment Trusts (REITs) | 0.9 | |||
Gas Utilities | 0.9 | |||
Software | 0.8 | |||
Commercial Services & Supplies | 0.7 | |||
Building Products | 0.6 | |||
Beverages | 0.5 | |||
Household Products | 0.5 | |||
Transportation Infrastructure | 0.5 | |||
Air Freight & Logistics | 0.4 | |||
Multiline Retail | 0.3 | |||
Independent Power & Renewable Electricity Producers | 0.3 | |||
Water Utilities | 0.2 | |||
Health Care Equipment & Supplies | 0.2 | |||
Airlines | 0.1 | |||
Consumer Finance | 0.1 | |||
Diversified Financial Services | 0.1 | |||
Life Sciences Tools & Services | 0.0 | * | ||
Health Care Technology | 0.0 | * | ||
Diversified Consumer Services | 0.0 | * | ||
|
| |||
100.5 | ||||
Liabilities in excess of other assets | (0.5 | ) | ||
|
| |||
100.0 | % | |||
|
|
* | Less than +/- 0.05% |
Effects of Derivative Instruments on the Financial Statements and Primary Underlying Risk Exposure:
The Series invested in derivative instruments during the reporting period. The primary type of risk associated with these derivative instruments is equity contracts risk. See the Notes to Financial Statements for additional detail regarding these derivative instruments and their risks. The effect of such derivative instruments on the Series’ financial position and financial performance as reflected in the Statement of Assets and Liabilities and Statement of Operations is presented in the summary below.
See Notes to Financial Statements.
22 |
The Series did not hold any derivative instruments as of April 30, 2020, accordingly, no derivative positions were presented in the Statement of Assets and Liabilities.
The effects of derivative instruments on the Statement of Operations for the six months ended April 30, 2020 are as follows:
Amount of Realized Gain (Loss) on Derivatives Recognized in Income | ||||
Derivatives not accounted for as hedging | Rights(1) | |||
Equity contracts | $ | (172,280 | ) | |
|
|
(1) | Included in net realized gain (loss) on investment transactions in the Statement of Operations. |
For the six months ended April 30, 2020, the Series did not have any net change in unrealized appreciation (depreciation) on derivatives in the Statement of Operations.
Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series entered into financial instruments/transactions during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for financial instruments/transactions where the legal right to set-off exists is presented in the summary below.
Offsetting of financial instrument/transaction assets and liabilities:
Description | Gross Market Value of Recognized Assets/(Liabilities) | Collateral Pledged/(Received)(1) | Net Amount | |||||||||
Securities on Loan | $ | 1,874,685 | $ | (1,874,685 | ) | $ | — | |||||
|
|
|
|
|
|
(1) | Collateral amount disclosed by the Series is limited to the market value of financial instruments/transactions. |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 23 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value, including securities on loan of $1,874,685: | ||||
Unaffiliated investments (cost $178,715,306) | $ | 171,860,995 | ||
Affiliated investments (cost $1,986,903) | 1,989,166 | |||
Foreign currency, at value (cost $1,787,052) | 1,787,140 | |||
Receivable for investments sold | 13,777,815 | |||
Tax reclaim receivable | 794,490 | |||
Dividends receivable | 652,106 | |||
Receivable for Series shares sold | 127,035 | |||
Prepaid expenses | 497 | |||
|
| |||
Total Assets | 190,989,244 | |||
|
| |||
Liabilities | ||||
Payable for investments purchased | 13,712,780 | |||
Payable to broker for collateral for securities on loan | 1,985,455 | |||
Payable to custodian | 1,691,574 | |||
Payable for Series shares reacquired | 303,303 | |||
Accrued expenses and other liabilities | 133,965 | |||
Affiliated transfer agent fee payable | 79,253 | |||
Management fee payable | 71,438 | |||
Distribution fee payable | 35,112 | |||
|
| |||
Total Liabilities | 18,012,880 | |||
|
| |||
Net Assets | $ | 172,976,364 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 287,192 | ||
Paid-in capital in excess of par | 187,777,091 | |||
Total distributable earnings (loss) | (15,087,919 | ) | ||
|
| |||
Net assets, April 30, 2020 | $ | 172,976,364 | ||
|
|
See Notes to Financial Statements.
24 |
Class A | ||||
Net asset value and redemption price per share, | $ | 6.02 | ||
Maximum sales charge (5.50% of offering price) | 0.35 | |||
|
| |||
Maximum offering price to public | $ | 6.37 | ||
|
| |||
Class B | ||||
Net asset value, offering price and redemption price per share, | $ | 5.76 | ||
|
| |||
Class C | ||||
Net asset value, offering price and redemption price per share, | $ | 5.74 | ||
|
| |||
Class Z | ||||
Net asset value, offering price and redemption price per share, | $ | 6.07 | ||
|
| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | $ | 6.07 | ||
|
|
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 25 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Unaffiliated dividend income (net of $335,209 foreign withholding tax) | $ | 2,751,693 | ||
Income from securities lending, net (including affiliated income of $3,618) | 7,535 | |||
Affiliated dividend income | 5,824 | |||
|
| |||
Total income | 2,765,052 | |||
|
| |||
Expenses | ||||
Management fee | 738,925 | |||
Distribution fee(a) | 259,935 | |||
Transfer agent’s fees and expenses (including affiliated expense of $161,849)(a) | 327,464 | |||
Custodian and accounting fees | 97,755 | |||
Registration fees(a) | 38,005 | |||
Shareholders’ reports | 34,376 | |||
Audit fee | 15,263 | |||
Legal fees and expenses | 8,725 | |||
Directors’ fees | 7,791 | |||
Miscellaneous | 25,646 | |||
|
| |||
Total expenses | 1,553,885 | |||
Less: Fee waiver and/or expense reimbursement(a) | (181,439 | ) | ||
|
| |||
Net expenses | 1,372,446 | |||
|
| |||
Net investment income (loss) | 1,392,606 | |||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions (including affiliated of $(5,368)) | (1,717,382 | ) | ||
Foreign currency transactions | (31,812 | ) | ||
|
| |||
(1,749,194 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments (including affiliated of $2,094) (net of change in foreign capital gains taxes $24,532) | (29,370,262 | ) | ||
Foreign currencies | (2,081 | ) | ||
|
| |||
(29,372,343 | ) | |||
|
| |||
Net gain (loss) on investment and foreign currency transactions | (31,121,537 | ) | ||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | (29,728,931 | ) | |
|
|
(a) | Class specific expenses and waivers were as follows: |
Class A | Class B | Class C | Class Z | Class R6 | ||||||||||||||||
Distribution fee | 241,948 | 4,285 | 13,702 | — | — | |||||||||||||||
Transfer agent’s fees and expenses | 300,614 | 9,533 | 5,108 | 12,070 | 139 | |||||||||||||||
Registration fees | 7,773 | 7,412 | 7,584 | 7,619 | 7,617 | |||||||||||||||
Fee waiver and/or expense reimbursement | (130,937 | ) | (14,423 | ) | (2,224 | ) | (10,605 | ) | (23,250 | ) |
See Notes to Financial Statements.
26 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 1,392,606 | $ | 4,919,888 | ||||
Net realized gain (loss) on investment and foreign currency transactions | (1,749,194 | ) | (5,932,231 | ) | ||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | (29,372,343 | ) | 15,303,867 | |||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | (29,728,931 | ) | 14,291,524 | |||||
|
|
|
| |||||
Dividends and Distributions | ||||||||
Distributions from distributable earnings | ||||||||
Class A | (4,101,945 | ) | (4,863,764 | ) | ||||
Class B | (14,282 | ) | (27,709 | ) | ||||
Class C | (50,447 | ) | (271,975 | ) | ||||
Class Z | (386,163 | ) | (443,611 | ) | ||||
Class R6 | (550,823 | ) | (1,275,473 | ) | ||||
|
|
|
| |||||
(5,103,660 | ) | (6,882,532 | ) | |||||
|
|
|
| |||||
Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 21,611,658 | 9,994,692 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | 5,027,591 | 6,792,808 | ||||||
Cost of shares reacquired | (16,150,370 | ) | (62,908,505 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | 10,488,879 | (46,121,005 | ) | |||||
|
|
|
| |||||
Total increase (decrease) | (24,343,712 | ) | (38,712,013 | ) | ||||
Net Assets: | ||||||||
Beginning of period | 197,320,076 | 236,032,089 | ||||||
|
|
|
| |||||
End of period | $ | 172,976,364 | $ | 197,320,076 | ||||
|
|
|
|
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 27 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act and may invest a greater percentage of their assets in the securities of a single company or other issuer than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund. These financial statements relate only to the PGIM QMA International Equity Fund (the “Series”).
The investment objective of the Series is to seek long-term growth of capital.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services — Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur
28 |
when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820 - Fair Value Measurements and Disclosures.
Common and preferred stocks, exchange-traded funds, and derivative instruments, such as futures or options, that are traded on a national securities exchange are valued at the last sale price as of the close of trading on the applicable exchange where the security principally trades. Securities traded via NASDAQ are valued at the NASDAQ official closing price. To the extent these securities are valued at the last sale price or NASDAQ official closing price, they are classified as Level 1 in the fair value hierarchy. In the event that no sale or official closing price on valuation date exists, these securities are generally valued at the mean between the last reported bid and ask prices, or at the last bid price in the absence of an ask price. These securities are classified as Level 2 in the fair value hierarchy.
Foreign equities traded on foreign securities exchanges are generally valued using pricing vendor services that provide model prices derived using adjustment factors based on information such as local closing price, relevant general and sector indices, currency fluctuations, depositary receipts, and futures, as applicable. Securities valued using such model prices are classified as Level 2 in the fair value hierarchy. The models generate an evaluated adjustment factor for each security, which is applied to the local closing price to adjust it for post closing market movements up to the time the Series is valued. Utilizing that evaluated adjustment factor, the vendor provides an evaluated price for each security. If the vendor does not provide an evaluated price, securities are valued in accordance with exchange-traded common and preferred stock valuation policies discussed above.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of
PGIM QMA International Equity Fund | 29 |
Notes to Financial Statements (unaudited) (continued)
the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses — at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally isolate that portion of
30 |
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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions.
Net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Master Netting Arrangements: The Fund, on behalf of the Series, is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
Rights: The Series held rights acquired either through a direct purchase or pursuant to corporate actions. Rights entitle the holder to buy a proportionate amount of common stock, or such other security that the issuer may specify, at a specific price and time through the expiration dates. Such rights are held as long positions by the Series until exercised, sold or expired. Rights are valued at fair value in accordance with the Board approved fair valuation procedures.
Securities Lending: The Series lends its portfolio securities to banks and broker-dealers. The loans are secured by collateral at least equal to the market value of the securities loaned. Collateral pledged by each borrower is invested in an affiliated money market fund and is marked to market daily, based on the previous day’s market value, such that the value of the collateral exceeds the value of the loaned securities. In the event of significant appreciation in value of securities on loan on the last business day of the reporting period, the financial statements may reflect a collateral value that is less than the market value of the loaned
PGIM QMA International Equity Fund | 31 |
Notes to Financial Statements (unaudited) (continued)
securities. Such shortfall is remedied as described above. Loans are subject to termination at the option of the borrower or the Series. Upon termination of the loan, the borrower will return to the Series securities identical to the loaned securities. Should the borrower of the securities fail financially, the Series has the right to repurchase the securities in the open market using the collateral.
The Series recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The borrower receives all interest and dividends from the securities loaned and such payments are passed back to the lender in amounts equivalent thereto. The Series also continues to recognize any unrealized gain (loss) in the market price of the securities loaned and on the change in the value of the collateral invested that may occur during the term of the loan. In addition, realized gain (loss) is recognized on changes in the value of the collateral invested upon liquidation of the collateral. Net earnings from securities lending are disclosed in the Statement of Operations.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to pay dividends from net investment income and distributions from net realized capital and currency gains, if any, annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting
32 |
principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with QMA LLC (“QMA”). The subadvisory agreement provides that QMA will furnish investment advisory services in connection with the management of the Series. In connection therewith, QMA is obligated to keep certain books and records of the Series. The Manager pays for the services of QMA, the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
The management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 0.75% of the Series’ average daily net assets up to $2 billion, 0.70% of the next $3 billion and 0.69% of the average daily net assets over $5 billion. The effective management fee rate before any waivers and/or expense reimbursements was 0.75% for the reporting period ended April 30, 2020.
The Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 2.53% of average daily net assets for Class B shares, and 0.78% of average daily net assets for Class R6 shares. This contractual waiver excludes interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
PGIM QMA International Equity Fund | 33 |
Notes to Financial Statements (unaudited) (continued)
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class and, in addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver/reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class B, Class C, Class Z and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A, Class B and Class C shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z and Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.30%, 1% and 1% of the average daily net assets of the Class A, Class B and Class C shares, respectively.
For the reporting period ended April 30, 2020, PIMS received $18,569 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS received $106 and $15 in contingent deferred sales charges imposed upon redemptions by certain Class B and Class C shareholders, respectively. From these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
PGIM Investments, PIMS and QMA are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PGIM Investments and an indirect, wholly-owned subsidiary of Prudential, serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), and its securities lending cash collateral in the PGIM Institutional Money Market Fund (the “Money Market Fund”), each a series of Prudential Investment Portfolios 2,
34 |
registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund and Money Market Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income” and “Income from securities lending, net”, respectively.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Fund’s Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $123,691,847 and $117,312,788, respectively.
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
Value, Beginning of Period | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 101,823 | $ | 29,875,607 | $ | 29,977,430 | $ | — | $ | — | $ | — | — | $ | 5,824 | ||||||||||||||||
PGIM Institutional Money Market Fund* | ||||||||||||||||||||||||||||||
1,221,989 | 15,214,030 | 14,443,579 | 2,094 | (5,368 | ) | 1,989,166 | 1,989,564 | 3,618 | ** | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
$ | 1,323,812 | $ | 45,089,637 | $ | 44,421,009 | $ | 2,094 | $ | (5,368 | ) | $ | 1,989,166 | $ | 9,442 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* | The Fund did not have any capital gain distributions during the reporting period. |
** | Represents the affiliated amount of securities lending income shown on the Statement of Operations. |
PGIM QMA International Equity Fund | 35 |
Notes to Financial Statements (unaudited) (continued)
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized depreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 181,834,127 | ||
|
| |||
Gross Unrealized Appreciation | 17,633,828 | |||
Gross Unrealized Depreciation | (25,617,794 | ) | ||
|
| |||
Net Unrealized Depreciation | $ | (7,983,966 | ) | |
|
|
The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $6,310,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class B, Class C, Class Z and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 5.50%. Investors who purchase $1 million or more of Class A shares and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1%, although they are not subject to an initial sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class B shares are sold with a CDSC which declines from 5% to zero depending on the period of time the shares are held. Class B shares will automatically convert to Class A shares on a monthly basis approximately seven years after purchase. Effective on or about June 26, 2020, all issued and outstanding Class B shares will be automatically converted to Class A shares. Class B shares are closed to new purchases. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
36 |
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, $0.01 par value per share, 700 million of which are designated as shares of the Series. The shares are further classified and designated as follows:
Class A | 100,000,000 | |||
Class B | 5,000,000 | |||
Class C | 100,000,000 | |||
Class Z | 180,000,000 | |||
Class T | 135,000,000 | |||
Class R6 | 180,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||
Class A | 36,412 | —%* | ||
Class Z | 48,631 | 3% | ||
Class R6 | 2,411,338 | 74% |
* | Amount represents less than 1% of outstanding shares. |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
1 | 8% | 2 | 31% |
PGIM QMA International Equity Fund | 37 |
Notes to Financial Statements (unaudited) (continued)
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 220,014 | $ | 1,525,701 | |||||
Shares issued in reinvestment of dividends and distributions | 543,821 | 4,029,714 | ||||||
Shares reacquired | (1,786,732 | ) | (12,112,864 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (1,022,897 | ) | (6,557,449 | ) | ||||
Shares issued upon conversion from other share class(es) | 47,980 | 324,913 | ||||||
Shares reacquired upon conversion into other share class(es) | (42,362 | ) | (277,660 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (1,017,279 | ) | $ | (6,510,196 | ) | |||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 405,337 | $ | 2,805,726 | |||||
Shares issued in reinvestment of dividends and distributions | 745,110 | 4,783,606 | ||||||
Shares reacquired | (2,958,509 | ) | (20,532,579 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (1,808,062 | ) | (12,943,247 | ) | ||||
Shares issued upon conversion from other share class(es) | 1,414,906 | 10,165,814 | ||||||
Shares reacquired upon conversion into other share class(es) | (163,486 | ) | (1,157,670 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (556,642 | ) | $ | (3,935,103 | ) | |||
|
|
|
| |||||
Class B | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 1,147 | $ | 8,089 | |||||
Shares issued in reinvestment of dividends and distributions | 2,005 | 14,254 | ||||||
Shares reacquired | (10,351 | ) | (70,232 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (7,199 | ) | (47,889 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (38,600 | ) | (247,500 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (45,799 | ) | $ | (295,389 | ) | |||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 456 | $ | 3,200 | |||||
Shares issued in reinvestment of dividends and distributions | 4,465 | 27,594 | ||||||
Shares reacquired | (24,678 | ) | (162,098 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (19,757 | ) | (131,304 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (87,433 | ) | (579,597 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (107,190 | ) | $ | (710,901 | ) | |||
|
|
|
|
38 |
Class C | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 27,040 | $ | 188,562 | |||||
Shares issued in reinvestment of dividends and distributions | 7,008 | 49,758 | ||||||
Shares reacquired | (38,331 | ) | (258,581 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (4,283 | ) | (20,261 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (11,556 | ) | (77,413 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (15,839 | ) | $ | (97,674 | ) | |||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 45,851 | $ | 295,704 | |||||
Shares issued in reinvestment of dividends and distributions | 43,387 | 267,695 | ||||||
Shares reacquired | (200,703 | ) | (1,325,590 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (111,465 | ) | (762,191 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (1,349,552 | ) | (9,308,179 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (1,461,017 | ) | $ | (10,070,370 | ) | |||
|
|
|
| |||||
Class Z | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 173,256 | $ | 1,127,011 | |||||
Shares issued in reinvestment of dividends and distributions | 51,415 | 383,042 | ||||||
Shares reacquired | (428,057 | ) | (2,848,212 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (203,386 | ) | (1,338,159 | ) | ||||
Shares issued upon conversion from other share class(es) | 40,535 | 267,732 | ||||||
Shares reacquired upon conversion into other share class(es) | (1,273 | ) | (7,293 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (164,124 | ) | $ | (1,077,720 | ) | |||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 184,066 | $ | 1,296,403 | |||||
Shares issued in reinvestment of dividends and distributions | 67,870 | 438,440 | ||||||
Shares reacquired | (320,357 | ) | (2,232,317 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (68,421 | ) | (497,474 | ) | ||||
Shares issued upon conversion from other share class(es) | 166,439 | 1,187,596 | ||||||
Shares reacquired upon conversion into other share class(es) | (46,515 | ) | (328,493 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 51,503 | $ | 361,629 | |||||
|
|
|
| |||||
Class R6 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 2,569,607 | $ | 18,762,295 | |||||
Shares issued in reinvestment of dividends and distributions | 73,936 | 550,823 | ||||||
Shares reacquired | (124,604 | ) | (860,481 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 2,518,939 | 18,452,637 | ||||||
Shares issued upon conversion from other share class(es) | 2,766 | 17,221 | ||||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 2,521,705 | $ | 18,469,858 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 797,936 | $ | 5,593,659 | |||||
Shares issued in reinvestment of dividends and distributions | 197,442 | 1,275,473 | ||||||
Shares reacquired | (5,440,241 | ) | (38,655,921 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | (4,444,863 | ) | (31,786,789 | ) | ||||
Shares issued upon conversion from other share class(es) | 2,916 | 20,529 | ||||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (4,441,947 | ) | $ | (31,766,260 | ) | |||
|
|
|
|
PGIM QMA International Equity Fund | 39 |
Notes to Financial Statements (unaudited) (continued)
7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent | |
* Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series utilized the SCA during the reporting period ended April 30, 2020. The average daily balance for the 23 days that the Series had loans outstanding during the period was approximately $170,870, borrowed at a weighted average interest rate of 2.60%. The maximum loan outstanding amount during the period was $300,000. At April 30, 2020, the Series did not have an outstanding loan amount.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than
40 |
those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Equity and Equity-Related Securities Risks: The value of a particular security could go down and you could lose money. In addition to an individual security losing value, the value of the equity markets or a sector in which the Series invests could go down. The Series’ holdings can vary significantly from broad market indexes and the performance of the Series can deviate from the performance of these indexes. Different parts of a market can react differently to adverse issuer, market, regulatory, political and economic developments.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets,
PGIM QMA International Equity Fund | 41 |
Notes to Financial Statements (unaudited) (continued)
including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
42 |
Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months 2020 |
Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.19 | $6.96 | $7.95 | $6.48 | $6.65 | $7.36 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.04 | 0.15 | 0.16 | 0.11 | 0.11 | 0.11 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.04 | ) | 0.28 | (1.00 | ) | 1.49 | (0.17 | ) | (0.65 | ) | ||||||||||||||||||
Total from investment operations | (1.00 | ) | 0.43 | (0.84 | ) | 1.60 | (0.06 | ) | (0.54 | ) | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | (0.17 | ) | (0.17 | ) | (0.15 | ) | (0.13 | ) | (0.11 | ) | (0.17 | ) | ||||||||||||||||
Distributions from net realized gains | - | (0.03 | ) | - | - | - | - | |||||||||||||||||||||
Total dividends and distributions | (0.17 | ) | (0.20 | ) | (0.15 | ) | (0.13 | ) | (0.11 | ) | (0.17 | ) | ||||||||||||||||
Net asset value, end of period | $6.02 | $7.19 | $6.96 | $7.95 | $6.48 | $6.65 | ||||||||||||||||||||||
Total Return(b): | (14.32)% | 6.53% | (10.81)% | 25.17% | (0.93)% | (7.37)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $138,784 | $173,103 | $171,326 | $207,626 | $185,120 | $211,314 | ||||||||||||||||||||||
Average net assets (000) | $162,185 | $172,031 | $200,255 | $192,517 | $189,980 | $229,598 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.46% | (e) | 1.48% | 1.34% | 1.58% | 1.66% | 1.62% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.62% | (e) | 1.62% | 1.47% | 1.59% | 1.66% | 1.62% | |||||||||||||||||||||
Net investment income (loss) | 1.32% | (e) | 2.19% | 2.08% | 1.62% | 1.69% | 1.39% | |||||||||||||||||||||
Portfolio turnover rate(f) | 60% | 94% | 114% | 105% | 114% | 111% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Effective August 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying portfolios in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 43 |
Financial Highlights (unaudited) (continued)
Class B Shares | ||||||||||||||||||||||||||||
Six Months 2020 |
Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.86 | $6.62 | $7.60 | $6.21 | $6.37 | $7.05 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | - | (b) | 0.05 | 0.07 | 0.05 | 0.06 | 0.05 | |||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.00 | ) | 0.30 | (0.96 | ) | 1.43 | (0.16 | ) | (0.61 | ) | ||||||||||||||||||
Total from investment operations | (1.00 | ) | 0.35 | (0.89 | ) | 1.48 | (0.10 | ) | (0.56 | ) | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | (0.10 | ) | (0.08 | ) | (0.09 | ) | (0.09 | ) | (0.06 | ) | (0.12 | ) | ||||||||||||||||
Distributions from net realized gains | - | (0.03 | ) | - | - | - | - | |||||||||||||||||||||
Total dividends and distributions | (0.10 | ) | (0.11 | ) | (0.09 | ) | (0.09 | ) | (0.06 | ) | (0.12 | ) | ||||||||||||||||
Net asset value, end of period | $5.76 | $6.86 | $6.62 | $7.60 | $6.21 | $6.37 | ||||||||||||||||||||||
Total Return(c): | (14.80)% | 5.55% | (11.90)% | 24.12% | (1.55)% | (7.96)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $617 | $1,049 | $1,723 | $3,020 | $3,080 | $4,774 | ||||||||||||||||||||||
Average net assets (000) | $862 | $1,368 | $2,556 | $2,833 | $3,710 | $5,313 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 2.53% | (f) | 2.53% | 2.53% | 2.39% | 2.36% | 2.32% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 5.90% | (f) | 3.97% | 3.21% | 2.72% | 2.36% | 2.32% | |||||||||||||||||||||
Net investment income (loss) | 0.12% | (f) | 0.77% | 0.88% | 0.75% | 0.96% | 0.68% | |||||||||||||||||||||
Portfolio turnover rate(g) | 60% | 94% | 114% | 105% | 114% | 111% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Effective August 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Does not include expenses of the underlying portfolios in which the Series invests. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
44 |
Class C Shares | ||||||||||||||||||||||||||||
Six Months 2020 |
Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.86 | $6.64 | $7.60 | $6.20 | $6.37 | $7.05 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | - | (b) | 0.07 | 0.10 | 0.06 | 0.06 | 0.06 | |||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.00 | ) | 0.30 | (0.97 | ) | 1.43 | (0.17 | ) | (0.62 | ) | ||||||||||||||||||
Total from investment operations | (1.00 | ) | 0.37 | (0.87 | ) | 1.49 | (0.11 | ) | (0.56 | ) | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | (0.12 | ) | (0.12 | ) | (0.09 | ) | (0.09 | ) | (0.06 | ) | (0.12 | ) | ||||||||||||||||
Distributions from net realized gains | - | (0.03 | ) | - | - | - | - | |||||||||||||||||||||
Total dividends and distributions | (0.12 | ) | (0.15 | ) | (0.09 | ) | (0.09 | ) | (0.06 | ) | (0.12 | ) | ||||||||||||||||
Net asset value, end of period | $5.74 | $6.86 | $6.64 | $7.60 | $6.20 | $6.37 | ||||||||||||||||||||||
Total Return(c): | (14.90)% | 5.77% | (11.52)% | 24.33% | (1.71)% | (7.96)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $2,360 | $2,928 | $12,530 | $16,661 | $15,892 | $18,209 | ||||||||||||||||||||||
Average net assets (000) | $2,755 | $7,163 | $15,626 | $15,736 | $16,416 | $20,086 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 2.71% | (f) | 2.25% | 2.10% | 2.32% | 2.36% | 2.32% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.87% | (f) | 2.39% | 2.23% | 2.33% | 2.36% | 2.32% | |||||||||||||||||||||
Net investment income (loss) | 0.06% | (f) | 1.09% | 1.32% | 0.86% | 0.98% | 0.71% | |||||||||||||||||||||
Portfolio turnover rate(g) | 60% | 94% | 114% | 105% | 114% | 111% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Effective August 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Does not include expenses of the underlying portfolios in which the Series invests. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 45 |
Financial Highlights (unaudited) (continued)
Class Z Shares | ||||||||||||||||||||||||||||
Six Months 2020 |
Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.26 | $7.02 | $8.02 | $6.54 | $6.70 | $7.42 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.06 | 0.18 | 0.19 | 0.11 | 0.13 | 0.13 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.04 | ) | 0.29 | (1.02 | ) | 1.52 | (0.16 | ) | (0.66 | ) | ||||||||||||||||||
Total from investment operations | (0.98 | ) | 0.47 | (0.83 | ) | 1.63 | (0.03 | ) | (0.53 | ) | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | (0.21 | ) | (0.20 | ) | (0.17 | ) | (0.15 | ) | (0.13 | ) | (0.19 | ) | ||||||||||||||||
Distributions from net realized gains | - | (0.03 | ) | - | - | - | - | |||||||||||||||||||||
Total dividends and distributions | (0.21 | ) | (0.23 | ) | (0.17 | ) | (0.15 | ) | (0.13 | ) | (0.19 | ) | ||||||||||||||||
Net asset value, end of period | $6.07 | $7.26 | $7.02 | $8.02 | $6.54 | $6.70 | ||||||||||||||||||||||
Total Return(b): | (14.09)% | 7.05% | (10.59)% | 25.46% | (0.44)% | (7.15)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $11,326 | $14,753 | $13,901 | $17,344 | $49,675 | $54,726 | ||||||||||||||||||||||
Average net assets (000) | $13,135 | $13,815 | $17,055 | $21,567 | $50,923 | $55,405 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.08% | (e) | 1.03% | 1.00% | 1.31% | 1.36% | 1.32% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.24% | (e) | 1.17% | 1.13% | 1.32% | 1.36% | 1.32% | |||||||||||||||||||||
Net investment income (loss) | 1.71% | (e) | 2.58% | 2.44% | 1.57% | 1.99% | 1.69% | |||||||||||||||||||||
Portfolio turnover rate(f) | 60% | 94% | 114% | 105% | 114% | 111% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Effective August 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(d) | Does not include expenses of the underlying portfolios in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
46 |
Class R6 Shares | ||||||||||||||||||||||||
Six Months 2020 |
Year Ended October 31, | December 28, 2016(a) through October 31, 2017 | ||||||||||||||||||||||
2019 | 2018 | |||||||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.27 | $7.03 | $8.04 | $6.32 | ||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.08 | 0.21 | 0.21 | 0.15 | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.06 | ) | 0.27 | (1.03 | ) | 1.57 | ||||||||||||||||||
Total from investment operations | (0.98 | ) | 0.48 | (0.82 | ) | 1.72 | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||
Dividends from net investment income | (0.22 | ) | (0.21 | ) | (0.19 | ) | - | |||||||||||||||||
Distributions from net realized gains | - | (0.03 | ) | - | - | |||||||||||||||||||
Total dividends and distributions | (0.22 | ) | (0.24 | ) | (0.19 | ) | - | |||||||||||||||||
Net asset value, end of period | $6.07 | $7.27 | $7.03 | $8.04 | ||||||||||||||||||||
Total Return(c): | (14.03)% | 7.33% | (10.43)% | 27.22% | ||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (000) | $19,889 | $5,487 | $36,552 | $39,379 | ||||||||||||||||||||
Average net assets (000) | $19,191 | $23,216 | $38,947 | $37,891 | ||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.78% | (f) | 0.78% | 0.78% | 0.95% | (f) | ||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.02% | (f) | 0.95% | 0.95% | 0.99% | (f) | ||||||||||||||||||
Net investment income (loss) | 2.24% | (f) | 3.06% | 2.61% | 2.45% | (f) | ||||||||||||||||||
Portfolio turnover rate(g) | 60% | 94% | 114% | 105% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Effective August 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Does not include expenses of the underlying portfolios in which the Series invests. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM QMA International Equity Fund | 47 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
48 |
Supplement dated December 18, 2019
to the Currently Effective Summary Prospectus, Prospectus
and Statement of Additional Information of the Funds Listed Below
This supplement should be read in conjunction with your Summary Prospectus, Statutory Prospectus and Statement of Additional Information, be retained for future reference and is in addition to any existing Fund supplements.
The Board of Directors/Trustees for each Fund listed below has approved the conversion of all issued and outstanding Class B shares of the Funds to Class A shares of the same Fund, effective on or about June 26, 2020.
As a result, effective on or about the close of business on June 26, 2020, all of the issued and outstanding Class B shares of a Fund will be converted into Class A shares of that Fund with the same relative aggregate net asset value as the Class B shares held immediately prior to the conversion. Class A shares currently have lower total expense ratios, and equal or lower distribution fees and shareholder servicing fees payable under the Fund’s 12b-1 plan than Class B shares. No sales load, fee, or other charge will be imposed on the conversion of these shares. Class A shares are not subject to the contingent deferred sales charge (if any) currently charged on the redemption of Class B shares. Please refer to your Fund’s Prospectus for more information regarding Class A shares. The conversion is not expected to be a taxable event for federal income tax purposes and should not result in recognition of gain or loss by converting shareholders.
LR1263
The Prudential Investment Portfolios, Inc.
PGIM Balanced Fund
PGIM Jennison Focused Value Fund
PGIM Jennison Growth Fund
Prudential Investment Portfolios 3
PGIM Jennison Focused Growth Fund
PGIM QMA Large-Cap Value Fund
PGIM Real Assets Fund
Prudential Investment Portfolios 4
PGIM Muni High Income Fund
Prudential Investment Portfolios 5
PGIM Jennison Diversified Growth Fund
Prudential Investment Portfolios 6
PGIM California Muni Income Fund
Prudential Investment Portfolios 7
PGIM Jennison Value Fund
Prudential Investment Portfolios 9
PGIM QMA Large-Cap Core Equity Fund
Prudential Investment Portfolios, Inc. 10
PGIM Jennison Global Equity Income Fund
PGIM QMA Mid-Cap Value Fund
Prudential Investment Portfolios 12
PGIM Global Real Estate Fund
PGIM US Real Estate Fund
Prudential Investment Portfolios, Inc. 14
PGIM Government Income Fund
Prudential Investment Portfolios, Inc. 15
PGIM High Yield Fund
Prudential Investment Portfolios 16
PGIM Income Builder Fund
Prudential Investment Portfolios, Inc. 17
PGIM Total Return Bond Fund
Prudential Investment Portfolios 18
PGIM Jennison 20/20 Focus Fund
Prudential Global Total Return Fund, Inc.
PGIM Global Total Return Fund
Prudential Jennison Blend Fund, Inc.
PGIM Jennison Blend Fund
Prudential Jennison Mid-Cap Growth Fund, Inc.
PGIM Jennison Mid-Cap Growth Fund
Prudential Jennison Natural Resources Fund, Inc.
PGIM Jennison Natural Resources Fund
Prudential Jennison Small Company Fund, Inc.
PGIM Jennison Small Company Fund
Prudential Government Money Market Fund, Inc.
PGIM Government Money Market Fund
Prudential National Muni Fund, Inc.
PGIM National Muni Fund
Prudential Sector Funds, Inc.
PGIM Jennison Financial Services Fund
PGIM Jennison Health Sciences Fund
PGIM Jennison Utility Fund
Prudential Short-Term Corporate Bond Fund, Inc.
PGIM Short-Term Corporate Bond Fund
Prudential World Fund, Inc.
PGIM QMA International Equity Fund
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | QMA LLC | Gateway Center Two 100 Mulberry Street Newark, NJ 07102 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
| ||||
CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street New York, NY 10286 | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue New York, NY 10017 | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM QMA International Equity Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM QMA INTERNATIONAL EQUITY FUND
SHARE CLASS | A | B | C | Z | R6 | |||||
NASDAQ | PJRAX | PJRBX | PJRCX | PJIZX | PJRQX | |||||
CUSIP | 743969859 | 743969867 | 743969875 | 743969883 | 743969578 |
MF190E2
PGIM EMERGING MARKETS DEBT
LOCAL CURRENCY FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
3 | ||||
4 | ||||
7 | ||||
9 |
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC (PIMS), member SIPC. PGIM Fixed Income is a unit of PGIM, Inc. (PGIM), a registered investment adviser. PIMS and PGIM are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. PGIM and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
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Dear Shareholder:
We hope you find the semiannual report for PGIM Emerging Markets Debt Local Currency Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Emerging Markets Debt Local Currency Fund
June 15, 2020
PGIM Emerging Markets Debt Local Currency Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
(without sales charges) | Average Annual Total Returns as of 4/30/20 (with sales charges) | |||||||
Six Months* (%) | One Year (%) | Five Years (%) | Since Inception (%) | |||||
Class A | –11.81 | –7.69 | –1.29 | –1.59 (3/30/11) | ||||
Class C | –12.05 | –6.14 | –1.36 | –1.88 (3/30/11) | ||||
Class Z | –11.67 | –4.36 | –0.39 | –0.95 (3/30/11) | ||||
Class R6 | –11.50 | –4.18 | –0.29 | –0.88 (3/30/11) | ||||
JP Morgan Government Bond Index-Emerging Markets Global Diversified Index | ||||||||
–9.91 | –2.68 | 0.45 | –0.37 |
*Not annualized
Source: PGIM Investments LLC, Lipper, Inc. and JP Morgan
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to the Fund’s inception date.
The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class Z | Class R6 | |||||
Maximum initial sales charge | For purchases on or after July 15, 2019: 3.25% of the public offering price. For purchases prior to July 15, 2019: 4.50% of the public offering price | None | None | None | ||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | For purchases on or after July 15, 2019: 1.00% on sales of $500,000 or more made within 12 months of purchase. For purchases prior to July 15, 2019: 1.00% on sales of $1 million or more made within 12 months of purchase. | 1.00% on sales made within 12 months of purchase | None | None | ||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.25% | 1.00% | None | None |
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Benchmark Definitions
JP Morgan Government Bond Index-Emerging Markets Global Diversified Index—The JP Morgan Government Bond Index-Emerging Markets Global Diversified Index, an unmanaged index, is a comprehensive emerging markets debt benchmark that tracks local currency bonds issued by emerging market governments.
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
Distributions and Yields as of 4/30/20 | ||||||
Total Distributions Paid for Six Months ($) | SEC 30-Day Subsidized Yield* (%) | SEC 30-Day Unsubsidized Yield** (%) | ||||
Class A | 0.14 | 5.18 | 4.26 | |||
Class C | 0.12 | 4.64 | 0.99 | |||
Class Z | 0.16 | 5.73 | 5.04 | |||
Class R6 | 0.16 | 5.82 | –24.92 |
*SEC 30-Day Subsidized Yield (%)—A standardized yield calculation created by the Securities and Exchange Commission, it reflects the income earned during a 30-day period, after the deduction of the Fund’s net expenses (net of any expense waivers or reimbursements). The investor experience is represented by the SEC 30-Day Subsidized Yield.
**SEC 30-Day Unsubsidized Yield (%)—A standardized yield calculation created by the Securities and Exchange Commission, it reflects the income earned during a 30-day period, after the deduction of the Fund’s gross expenses. The investor experience is represented by the SEC 30-Day Subsidized Yield.
PGIM Emerging Markets Debt Local Currency Fund | 5 |
Your Fund’s Performance (continued)
Credit Quality expressed as a percentage of total investments as of 4/30/20 (%) | ||||
AAA | 1.6 | |||
AA | 5.7 | |||
A | 29.4 | |||
BBB | 31.0 | |||
BB | 18.4 | |||
B | 6.8 | |||
CCC | 1.3 | |||
CC | 0.3 | |||
Not Rated | 2.7 | |||
Cash/Cash Equivalents | 2.8 | |||
Total Investments | 100.0 |
Source: PGIM Fixed Income
Credit ratings reflect the highest rating assigned by a nationally recognized statistical rating organization (NRSRO) such as Moody’s Investors Service, Inc. (Moody’s), S&P Global Ratings (S&P), or Fitch, Inc. (Fitch). Credit ratings reflect the common nomenclature used by both S&P and Fitch. Where applicable, ratings are converted to the comparable S&P/Fitch rating tier nomenclature. These rating agencies are independent and are widely used. The Not Rated category consists of securities that have not been rated by a NRSRO. Credit ratings are subject to change.
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As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
PGIM Emerging Markets Debt Local Currency Fund | 7 |
Fees and Expenses (continued)
and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Emerging Markets Debt Local Currency Fund | Beginning Account Value November 1, 2019 | Ending Account | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 881.90 | 1.14 | % | $ | 5.33 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.19 | 1.14 | % | $ | 5.72 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 879.50 | 1.89 | % | $ | 8.83 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,015.47 | 1.89 | % | $ | 9.47 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 883.30 | 0.75 | % | $ | 3.51 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,021.13 | 0.75 | % | $ | 3.77 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 885.00 | 0.69 | % | $ | 3.23 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,021.43 | 0.69 | % | $ | 3.47 |
* Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
8 | Visit our website at pgiminvestments.com |
Schedule of Investments (unaudited)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
LONG-TERM INVESTMENTS 93.2% | ||||||||||||||||
SOVEREIGN BONDS 82.6% | ||||||||||||||||
Angola 0.4% | ||||||||||||||||
Angolan Government International Bond, | 9.500 | % | 11/12/25 | 400 | $ | 189,897 | ||||||||||
|
| |||||||||||||||
Argentina 0.3% | ||||||||||||||||
Argentine Republic Government International Bond, | 5.625 | 01/26/22 | 180 | 50,399 | ||||||||||||
Provincia de Buenos Aires/Government Bonds, | ||||||||||||||||
Sr. Unsec’d. Notes | 9.125 | 03/16/24 | 200 | 55,060 | ||||||||||||
Sr. Unsec’d. Notes | 9.950 | 06/09/21 | 140 | 37,980 | ||||||||||||
|
| |||||||||||||||
143,439 | ||||||||||||||||
Bahrain 0.4% | ||||||||||||||||
Bahrain Government International Bond, | 6.125 | 07/05/22 | 200 | 200,992 | ||||||||||||
|
| |||||||||||||||
Brazil 1.1% | ||||||||||||||||
Brazil Minas SPE via State of Minas Gerais, | 5.333 | 02/15/28 | 188 | 187,927 | ||||||||||||
Brazil Notas do Tesouro Nacional, | ||||||||||||||||
Notes, Series NTNF | 10.000 | 01/01/27 | BRL | 1,190 | 250,293 | |||||||||||
Notes, Series NTNF | 10.000 | 01/01/29 | BRL | 400 | 84,227 | |||||||||||
Brazilian Government International Bond, | 8.500 | 01/05/24 | BRL | 54 | 10,129 | |||||||||||
|
| |||||||||||||||
532,576 | ||||||||||||||||
Chile 3.6% | ||||||||||||||||
Bonos de la Tesoreria de la Republica en pesos, | ||||||||||||||||
Bonds | 4.500 | 03/01/26 | CLP | 540,000 | 738,194 | |||||||||||
Bonds | 5.000 | 03/01/35 | CLP | 120,000 | 180,065 | |||||||||||
Bonds, Series 30YR | 6.000 | 01/01/43 | CLP | 255,000 | 443,300 | |||||||||||
Unsec’d. Notes, 144A | 4.700 | 09/01/30 | CLP | 260,000 | 368,282 | |||||||||||
|
| |||||||||||||||
1,729,841 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
China 3.1% | ||||||||||||||||
China Government Bond, | ||||||||||||||||
Bonds, Series 1906 | 3.290 | % | 05/23/29 | CNH | 6,690 | $ | 1,000,587 | |||||||||
Unsec’d. Notes, Series 1910 | 3.860 | 07/22/49 | CNH | 3,110 | 483,310 | |||||||||||
|
| |||||||||||||||
1,483,897 | ||||||||||||||||
Colombia 4.2% | ||||||||||||||||
Colombian TES, | ||||||||||||||||
Bonds, Series B | 6.000 | 04/28/28 | COP | 4,531,000 | 1,092,236 | |||||||||||
Bonds, Series B | 7.500 | 08/26/26 | COP | 500,000 | 134,939 | |||||||||||
Bonds, Series B | 6.250 | 11/26/25 | COP | 500,000 | 128,247 | |||||||||||
Bonds, Series B | 7.000 | 06/30/32 | COP | 1,187,600 | 294,371 | |||||||||||
Bonds, Series B | 7.250 | 10/18/34 | COP | 829,000 | 210,331 | |||||||||||
Bonds, Series B | 7.750 | 09/18/30 | COP | 500,000 | 132,782 | |||||||||||
|
| |||||||||||||||
1,992,906 | ||||||||||||||||
Czech Republic 2.0% | ||||||||||||||||
Czech Republic Government Bond, | ||||||||||||||||
Bonds, Series 049 | 4.200 | 12/04/36 | CZK | 3,500 | 198,524 | |||||||||||
Bonds, Series 053 | 4.850 | 11/26/57 | CZK | 1,850 | 115,051 | |||||||||||
Bonds, Series 094 | 0.950 | 05/15/30 | CZK | 5,600 | 220,302 | |||||||||||
Bonds, Series 100 | 0.250 | 02/10/27 | CZK | 4,300 | 164,129 | |||||||||||
Bonds, Series 103 | 2.000 | 10/13/33 | CZK | 5,620 | 242,570 | |||||||||||
|
| |||||||||||||||
940,576 | ||||||||||||||||
Dominican Republic 0.3% | ||||||||||||||||
Dominican Republic International Bond, | 9.750 | 06/05/26 | DOP | 8,000 | 121,276 | |||||||||||
|
| |||||||||||||||
Ecuador 0.2% | ||||||||||||||||
Ecuador Government International Bond, | 10.750 | 03/28/22 | 260 | 83,016 | ||||||||||||
|
| |||||||||||||||
Egypt 0.6% | ||||||||||||||||
Egypt Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes, 144A, MTN | 4.750 | 04/11/25 | EUR | 175 | 168,710 | |||||||||||
Sr. Unsec’d. Notes, EMTN | 4.750 | 04/11/25 | EUR | 100 | 96,405 | |||||||||||
|
| |||||||||||||||
265,115 |
See Notes to Financial Statements.
10 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
El Salvador 0.2% | ||||||||||||||||
El Salvador Government International Bond, | 7.750 | % | 01/24/23 | 125 | $ | 107,662 | ||||||||||
|
| |||||||||||||||
Gabon 0.6% | ||||||||||||||||
Gabon Government International Bond, | ||||||||||||||||
Bonds | 6.375 | 12/12/24 | 200 | 144,079 | ||||||||||||
Sr. Unsec’d. Notes | 6.950 | 06/16/25 | 200 | 142,774 | ||||||||||||
|
| |||||||||||||||
286,853 | ||||||||||||||||
Ghana 0.5% | ||||||||||||||||
Ghana Government International Bond, | 8.125 | 01/18/26 | 285 | 234,755 | ||||||||||||
|
| |||||||||||||||
Hungary 3.3% | ||||||||||||||||
Hungary Government Bond, | ||||||||||||||||
Bonds, Series 24/C | 2.500 | 10/24/24 | HUF | 40,000 | 130,176 | |||||||||||
Bonds, Series 25/B | 5.500 | 06/24/25 | HUF | 219,080 | 814,226 | |||||||||||
Bonds, Series 26/D | 2.750 | 12/22/26 | HUF | 50,000 | 165,856 | |||||||||||
Bonds, Series 27/A | 3.000 | 10/27/27 | HUF | 42,680 | 142,714 | |||||||||||
Bonds, Series 28/A | 6.750 | 10/22/28 | HUF | 56,680 | 242,511 | |||||||||||
Bonds, Series 38/A | 3.000 | 10/27/38 | HUF | 21,890 | 73,840 | |||||||||||
|
| |||||||||||||||
1,569,323 | ||||||||||||||||
Indonesia 11.2% | ||||||||||||||||
Indonesia Treasury Bond, | ||||||||||||||||
Bonds, Series 056 | 8.375 | 09/15/26 | IDR | 15,591,000 | 1,087,018 | |||||||||||
Bonds, Series 059 | 7.000 | 05/15/27 | IDR | 7,765,000 | 499,627 | |||||||||||
Bonds, Series 063 | 5.625 | 05/15/23 | IDR | 2,250,000 | 146,612 | |||||||||||
Bonds, Series 064 | 6.125 | 05/15/28 | IDR | 2,400,000 | 144,372 | |||||||||||
Bonds, Series 065 | 6.625 | 05/15/33 | IDR | 3,200,000 | 189,336 | |||||||||||
Bonds, Series 068 | 8.375 | 03/15/34 | IDR | 4,950,000 | 337,686 | |||||||||||
Bonds, Series 070 | 8.375 | 03/15/24 | IDR | 7,910,000 | 552,489 | |||||||||||
Bonds, Series 071 | 9.000 | 03/15/29 | IDR | 7,310,000 | 522,441 | |||||||||||
Bonds, Series 072 | 8.250 | 05/15/36 | IDR | 4,760,000 | 323,301 | |||||||||||
Bonds, Series 073 | 8.750 | 05/15/31 | IDR | 8,805,000 | 619,340 | |||||||||||
Bonds, Series 075 | 7.500 | 05/15/38 | IDR | 4,900,000 | 307,716 | |||||||||||
Bonds, Series 077 | 8.125 | 05/15/24 | IDR | 3,500,000 | 243,028 | |||||||||||
Bonds, Series 078 | 8.250 | 05/15/29 | IDR | 5,750,000 | 394,424 | |||||||||||
|
| |||||||||||||||
5,367,390 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Iraq 0.4% | ||||||||||||||||
Iraq International Bond, | 6.752 | % | 03/09/23 | 280 | $ | 211,961 | ||||||||||
|
| |||||||||||||||
Ivory Coast 0.6% | ||||||||||||||||
Ivory Coast Government International Bond, | 5.125 | 06/15/25 | EUR | 265 | 267,286 | |||||||||||
|
| |||||||||||||||
Malaysia 6.0% | ||||||||||||||||
Malaysia Government Bond, | ||||||||||||||||
Bonds, Series 115 | 3.955 | 09/15/25 | MYR | 1,150 | 286,758 | |||||||||||
Bonds, Series 116 | 3.800 | 08/17/23 | MYR | 1,250 | 302,941 | |||||||||||
Bonds, Series 118 | 3.882 | 03/14/25 | MYR | 1,977 | 486,444 | |||||||||||
Bonds, Series 217 | 4.059 | 09/30/24 | MYR | 335 | 82,800 | |||||||||||
Bonds, Series 311 | 4.392 | 04/15/26 | MYR | 285 | 72,334 | |||||||||||
Bonds, Series 316 | 3.900 | 11/30/26 | MYR | 2,370 | 589,673 | |||||||||||
Bonds, Series 317 | 4.762 | 04/07/37 | MYR | 500 | 136,278 | |||||||||||
Bonds, Series 411 | 4.232 | 06/30/31 | MYR | 280 | 72,226 | |||||||||||
Bonds, Series 413 | 3.844 | 04/15/33 | MYR | 140 | 34,606 | |||||||||||
Bonds, Series 417 | 3.899 | 11/16/27 | MYR | 1,370 | 342,656 | |||||||||||
Bonds, Series 513 | 3.733 | 06/15/28 | MYR | 730 | 180,562 | |||||||||||
Bonds, Series 518 | 4.921 | 07/06/48 | MYR | 445 | 126,250 | |||||||||||
Malaysia Government Investment Issue, | ||||||||||||||||
Bonds, Series 617 | 4.724 | 06/15/33 | MYR | 600 | 162,428 | |||||||||||
|
| |||||||||||||||
2,875,956 | ||||||||||||||||
Mexico 2.0% | ||||||||||||||||
Mexican Bonos, | ||||||||||||||||
Bonds, Series M | 7.750 | 05/29/31 | MXN | 7,800 | 344,898 | |||||||||||
Bonds, Series M30 | 10.000 | 11/20/36 | MXN | 4,600 | 240,020 | |||||||||||
Sr. Unsec’d. Notes, Series M | 7.750 | 11/13/42 | MXN | 5,400 | 225,868 | |||||||||||
Sr. Unsec’d. Notes, Series M30 | 8.500 | 11/18/38 | MXN | 3,700 | 166,613 | |||||||||||
|
| |||||||||||||||
977,399 | ||||||||||||||||
Nigeria 0.4% | ||||||||||||||||
Nigeria Government International Bond, | 7.625 | 11/21/25 | 200 | 167,119 | ||||||||||||
|
|
See Notes to Financial Statements.
12 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Pakistan 0.8% | ||||||||||||||||
Third Pakistan International Sukuk Co. Ltd. (The), | 5.625 | % | 12/05/22 | 400 | $ | 368,908 | ||||||||||
|
| |||||||||||||||
Peru 5.2% | ||||||||||||||||
Peru Government Bond, | ||||||||||||||||
Bonds | 6.950 | 08/12/31 | PEN | 190 | 66,570 | |||||||||||
Sr. Unsec’d. Notes, 144A | 5.350 | 08/12/40 | PEN | 1,000 | 281,952 | |||||||||||
Sr. Unsec’d. Notes, 144A | 5.940 | 02/12/29 | PEN | 200 | 66,663 | |||||||||||
Sr. Unsec’d. Notes, 144A | 6.150 | 08/12/32 | PEN | 2,180 | 714,648 | |||||||||||
Peruvian Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 2.783 | 01/23/31 | 50 | 51,574 | ||||||||||||
Sr. Unsec’d. Notes | 6.350 | 08/12/28 | PEN | 305 | 104,845 | |||||||||||
Sr. Unsec’d. Notes | 6.900 | 08/12/37 | PEN | 871 | 297,771 | |||||||||||
Sr. Unsec’d. Notes | 6.950 | 08/12/31 | PEN | 538 | 190,145 | |||||||||||
Sr. Unsec’d. Notes | 8.200 | 08/12/26 | PEN | 1,472 | 554,798 | |||||||||||
Unsec’d. Notes | 5.700 | 08/12/24 | PEN | 500 | 170,403 | |||||||||||
|
| |||||||||||||||
2,499,369 | ||||||||||||||||
Philippines 0.2% | ||||||||||||||||
Philippine Government Bond, | 3.625 | 09/09/25 | PHP | 5,600 | 112,078 | |||||||||||
|
| |||||||||||||||
Poland 4.4% | ||||||||||||||||
Republic of Poland Government Bond, | ||||||||||||||||
Bonds, Series 0725 | 3.250 | 07/25/25 | PLN | 1,671 | 449,591 | |||||||||||
Bonds, Series 0726 | 2.500 | 07/25/26 | PLN | 3,740 | 976,102 | |||||||||||
Bonds, Series 0727 | 2.500 | 07/25/27 | PLN | 850 | 222,237 | |||||||||||
Bonds, Series 1029 | 2.750 | 10/25/29 | PLN | 1,740 | 467,231 | |||||||||||
|
| |||||||||||||||
2,115,161 | ||||||||||||||||
Romania 2.1% | ||||||||||||||||
Romania Government Bond, | ||||||||||||||||
Bonds, Series 05YR | 4.250 | 06/28/23 | RON | 2,670 | 611,273 | |||||||||||
Bonds, Series 07YR | 3.250 | 04/29/24 | RON | 750 | 165,790 | |||||||||||
Bonds, Series 10YR | 5.850 | 04/26/23 | RON | 460 | 109,964 | |||||||||||
Bonds, Series 15YR | 3.650 | 09/24/31 | RON | 590 | 118,112 | |||||||||||
|
| |||||||||||||||
1,005,139 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 13 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Russia 3.2% | ||||||||||||||||
Russian Federal Bond - OFZ, | ||||||||||||||||
Bonds, Series 6212 | 7.050 | % | 01/19/28 | RUB | 19,800 | $ | 286,980 | |||||||||
Bonds, Series 6218 | 8.500 | 09/17/31 | RUB | 14,092 | 227,343 | |||||||||||
Bonds, Series 6221 | 7.700 | 03/23/33 | RUB | 27,090 | 415,385 | |||||||||||
Bonds, Series 6228 | 7.650 | 04/10/30 | RUB | 28,800 | 434,573 | |||||||||||
Bonds, Series 6230 | 7.700 | 03/16/39 | RUB | 9,200 | 144,220 | |||||||||||
|
| |||||||||||||||
1,508,501 | ||||||||||||||||
South Africa 10.7% | ||||||||||||||||
Republic of South Africa Government Bond, | ||||||||||||||||
Sr. Unsec’d. Notes, Series 2023 | 7.750 | 02/28/23 | ZAR | 1,500 | 85,524 | |||||||||||
Sr. Unsec’d. Notes, Series 2030 | 8.000 | 01/31/30 | ZAR | 10,200 | 474,341 | |||||||||||
Sr. Unsec’d. Notes, Series 2032 | 8.250 | 03/31/32 | ZAR | 15,100 | 678,979 | |||||||||||
Sr. Unsec’d. Notes, Series 2035 | 8.875 | 02/28/35 | ZAR | 2,490 | 110,990 | |||||||||||
Sr. Unsec’d. Notes, Series 2037 | 8.500 | 01/31/37 | ZAR | 6,850 | 287,773 | |||||||||||
Sr. Unsec’d. Notes, Series 2040 | 9.000 | 01/31/40 | ZAR | 5,350 | 228,718 | |||||||||||
Sr. Unsec’d. Notes, Series 2044 | 8.750 | 01/31/44 | ZAR | 3,485 | 142,717 | |||||||||||
Sr. Unsec’d. Notes, Series 2048 | 8.750 | 02/28/48 | ZAR | 3,135 | 127,293 | |||||||||||
Sr. Unsec’d. Notes, Series R186 | 10.500 | 12/21/26 | ZAR | 39,148 | 2,332,057 | |||||||||||
Sr. Unsec’d. Notes, Series R209 | 6.250 | 03/31/36 | ZAR | 5,080 | 172,937 | |||||||||||
Sr. Unsec’d. Notes, Series R213 | 7.000 | 02/28/31 | ZAR | 7,830 | 327,643 | |||||||||||
Sr. Unsec’d. Notes, Series R214 | 6.500 | 02/28/41 | ZAR | 4,470 | 145,369 | |||||||||||
|
| |||||||||||||||
5,114,341 | ||||||||||||||||
Sri Lanka 0.6% | ||||||||||||||||
Sri Lanka Government International Bond, | 6.250 | 07/27/21 | 400 | 279,048 | ||||||||||||
|
| |||||||||||||||
Thailand 8.8% | ||||||||||||||||
Thailand Government Bond, | ||||||||||||||||
Bonds | 2.875 | 12/17/28 | THB | 24,740 | 871,275 | |||||||||||
Bonds | 2.875 | 06/17/46 | THB | 3,150 | 112,603 | |||||||||||
Bonds | 3.300 | 06/17/38 | THB | 6,300 | 248,322 | |||||||||||
Bonds | 3.400 | 06/17/36 | THB | 17,250 | 674,499 | |||||||||||
Sr. Unsec’d. Notes | 1.600 | 06/17/35 | THB | 3,900 | 124,535 | |||||||||||
Sr. Unsec’d. Notes | 2.125 | 12/17/26 | THB | 20,320 | 670,022 | |||||||||||
Sr. Unsec’d. Notes | 3.625 | 06/16/23 | THB | 8,530 | 286,767 | |||||||||||
Sr. Unsec’d. Notes | 3.650 | 06/20/31 | THB | 13,600 | 517,897 | |||||||||||
Sr. Unsec’d. Notes | 3.775 | 06/25/32 | THB | 17,800 | 698,265 | |||||||||||
|
| |||||||||||||||
4,204,185 |
See Notes to Financial Statements.
14 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Turkey 3.6% | ||||||||||||||||
Turkey Government Bond, | ||||||||||||||||
Bonds | 8.500 | % | 09/14/22 | TRY | 1,900 | $ | 266,181 | |||||||||
Bonds | 8.800 | 09/27/23 | TRY | 500 | 67,699 | |||||||||||
Bonds | 9.000 | 07/24/24 | TRY | 2,700 | 362,054 | |||||||||||
Bonds | 10.600 | 02/11/26 | TRY | 2,200 | 306,232 | |||||||||||
Bonds | 12.200 | 01/18/23 | TRY | 2,315 | 347,119 | |||||||||||
Bonds | 12.400 | 03/08/28 | TRY | 1,000 | 150,275 | |||||||||||
Turkiye Ihracat Kredi Bankasi A/S, | 4.250 | 09/18/22 | 250 | 238,355 | ||||||||||||
|
| |||||||||||||||
1,737,915 | ||||||||||||||||
Ukraine 1.4% | ||||||||||||||||
Ukraine Government International Bond, | ||||||||||||||||
Bonds | 16.000 | 08/11/21 | UAH | 500 | 18,625 | |||||||||||
Bonds | 17.000 | 05/11/22 | UAH | 500 | 19,000 | |||||||||||
Bonds | 18.000 | 03/24/21 | UAH | 604 | 22,826 | |||||||||||
Bonds, 144A | 11.670 | 11/22/23 | UAH | 2,414 | 79,289 | |||||||||||
Sr. Unsec’d. Notes | 7.750 | 09/01/24 | 402 | 379,132 | ||||||||||||
Unsec’d. Notes, 144A | 15.360 | 09/29/21 | UAH | 2,070 | 76,575 | |||||||||||
Unsec’d. Notes, 144A | 17.250 | 01/05/22 | UAH | 1,328 | 49,712 | |||||||||||
|
| |||||||||||||||
645,159 | ||||||||||||||||
Uruguay 0.2% | ||||||||||||||||
Uruguay Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 9.875 | 06/20/22 | UYU | 3,260 | 72,644 | |||||||||||
Sr. Unsec’d. Notes, 144A | 8.500 | 03/15/28 | UYU | 1,870 | 34,712 | |||||||||||
|
| |||||||||||||||
107,356 | ||||||||||||||||
|
| |||||||||||||||
TOTAL SOVEREIGN BONDS | 39,446,395 | |||||||||||||||
|
| |||||||||||||||
CORPORATE BONDS 10.6% | ||||||||||||||||
Bahrain 0.4% | ||||||||||||||||
Oil and Gas Holding Co. BSCC (The), | 7.625 | 11/07/24 | 200 | 196,028 | ||||||||||||
|
| |||||||||||||||
Belarus 0.4% | ||||||||||||||||
Development Bank of the Republic of Belarus JSC, | 6.750 | 05/02/24 | 200 | 185,427 | ||||||||||||
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 15 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
CORPORATE BONDS (Continued) | ||||||||||||||||
Brazil 0.4% | ||||||||||||||||
Petrobras Global Finance BV, | 8.750 | % | 05/23/26 | 165 | $ | 183,512 | ||||||||||
|
| |||||||||||||||
Indonesia 0.4% | ||||||||||||||||
Saka Energi Indonesia PT, | 4.450 | 05/05/24 | 225 | 194,625 | ||||||||||||
|
| |||||||||||||||
Jamaica 0.2% | ||||||||||||||||
Digicel Ltd., | 6.750 | 03/01/23 | 235 | 91,591 | ||||||||||||
|
| |||||||||||||||
Mexico 2.2% | ||||||||||||||||
America Movil SAB de CV, | 6.450 | 12/05/22 | MXN | 14,250 | 588,191 | |||||||||||
Petroleos Mexicanos, | ||||||||||||||||
Gtd. Notes | 6.500 | 03/13/27 | 80 | 64,871 | ||||||||||||
Gtd. Notes, 144A | 6.490 | 01/23/27 | 55 | 44,707 | ||||||||||||
Gtd. Notes, 144A | 7.650 | 11/24/21 | MXN | 4,120 | 158,986 | |||||||||||
Gtd. Notes, MTN | 6.875 | 08/04/26 | 235 | 194,619 | ||||||||||||
|
| |||||||||||||||
1,051,374 | ||||||||||||||||
Oman 0.4% | ||||||||||||||||
Lamar Funding Ltd., | 3.958 | 05/07/25 | 200 | 168,448 | ||||||||||||
|
| |||||||||||||||
Russia 3.9% | ||||||||||||||||
Gazprom Capital OOO, | ||||||||||||||||
Gtd. Notes, Series BO03 | 7.150 | (cc) | 02/15/28 | RUB | 90,000 | 1,233,925 | ||||||||||
Gtd. Notes, Series BO05 | 8.900 | (cc) | 02/03/27 | RUB | 42,000 | 611,199 | ||||||||||
|
| |||||||||||||||
1,845,124 | ||||||||||||||||
South Africa 0.3% | ||||||||||||||||
Eskom Holdings SOC Ltd., | 6.750 | 08/06/23 | 200 | 149,218 | ||||||||||||
|
| |||||||||||||||
Supranational Bank 1.5% | ||||||||||||||||
European Bank for Reconstruction & Development, | ||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.450 | 12/13/22 | IDR | 7,500,000 | 494,111 | |||||||||||
Sr. Unsec’d. Notes, EMTN | 7.500 | 05/15/22 | IDR | 900,000 | 60,477 |
See Notes to Financial Statements.
16 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
CORPORATE BONDS (Continued) | ||||||||||||||||
Supranational Bank (cont’d.) | ||||||||||||||||
International Bank for Reconstruction & Development, | 7.450 | % | 08/20/21 | IDR | 2,500,000 | $ | 167,885 | |||||||||
|
| |||||||||||||||
722,473 | ||||||||||||||||
Tunisia 0.5% | ||||||||||||||||
Banque Centrale de Tunisie International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 5.625 | 02/17/24 | EUR | 180 | 163,329 | |||||||||||
Sr. Unsec’d. Notes | 6.750 | 10/31/23 | EUR | 100 | 94,140 | |||||||||||
|
| |||||||||||||||
257,469 | ||||||||||||||||
|
| |||||||||||||||
TOTAL CORPORATE BONDS | 5,045,289 | |||||||||||||||
|
| |||||||||||||||
TOTAL LONG-TERM INVESTMENTS | 44,491,684 | |||||||||||||||
|
| |||||||||||||||
Shares | ||||||||||||||||
SHORT-TERM INVESTMENT 0.5% | ||||||||||||||||
AFFILIATED MUTUAL FUND | ||||||||||||||||
PGIM Core Ultra Short Bond Fund | 219,899 | 219,899 | ||||||||||||||
|
| |||||||||||||||
TOTAL INVESTMENTS 93.7% | 44,711,583 | |||||||||||||||
Other assets in excess of liabilities(z) 6.3% | 3,031,666 | |||||||||||||||
|
| |||||||||||||||
NET ASSETS 100.0% | $ | 47,743,249 | ||||||||||||||
|
|
Below is a list of the abbreviation(s) used in the semiannual report:
AUD—Australian Dollar
BRL—Brazilian Real
CAD—Canadian Dollar
CLP—Chilean Peso
CNH—Chinese Renminbi
COP—Colombian Peso
CZK—Czech Koruna
DOP—Dominican Peso
EGP—Egyptian Pound
EUR—Euro
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 17 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
HUF—Hungarian Forint
IDR—Indonesian Rupiah
ILS—Israeli Shekel
INR—Indian Rupee
JPY—Japanese Yen
KRW—South Korean Won
KZT—Kazakhstani Tenge
MXN—Mexican Peso
MYR—Malaysian Ringgit
NZD—New Zealand Dollar
PEN—Peruvian Nuevo Sol
PHP—Philippine Peso
PLN—Polish Zloty
RON—Romanian Leu
RUB—Russian Ruble
SGD—Singapore Dollar
THB—Thai Baht
TRY—Turkish Lira
TWD—New Taiwanese Dollar
UAH—Ukraine Hryvna
USD—US Dollar
UYU—Uruguayan Peso
ZAR—South African Rand
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
A—Annual payment frequency for swaps
BROIS—Brazil Overnight Index Swap
COOIS—Colombia Overnight Interbank Reference Rate
EMTN—Euro Medium Term Note
JIBAR—Johannesburg Interbank Agreed Rate
KLIBOR—Kuala Lumpur Interbank Offered Rate
KWCDC—Korean Won Certificate of Deposit
LIBOR—London Interbank Offered Rate
M—Monthly payment frequency for swaps
MIBOR—Mumbai Interbank Offered Rate
MTN—Medium Term Note
OFZ—Obligatsyi Federal’novo Zaima (Federal Loan Obligations)
OTC—Over-the-counter
PRIBOR—Prague Interbank Offered Rate
Q—Quarterly payment frequency for swaps
S—Semiannual payment frequency for swaps
T—Swap payment upon termination
WIBOR—Warsaw Interbank Offered Rate
# | Principal or notional amount is shown in U.S. dollars unless otherwise stated. |
(cc) | Variable rate instrument. The rate shown is based on the latest available information as of April 30, 2020. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund. |
(z) | Includes net unrealized appreciation/(depreciation) and/or market value of the below holdings which are excluded from the Schedule of Investments: |
See Notes to Financial Statements.
18 |
Futures contracts outstanding at April 30, 2020:
Number of Contracts | Type | Expiration Date | Current Notional Amount | Value / Unrealized Appreciation (Depreciation) | ||||||||||||
Short Positions: | ||||||||||||||||
6 | 2 Year U.S. Treasury Notes | Jun. 2020 | $ | 1,322,578 | $ | (523 | ) | |||||||||
4 | 5 Year Euro-Bobl | Jun. 2020 | 595,923 | (2,370 | ) | |||||||||||
18 | 5 Year U.S. Treasury Notes | Jun. 2020 | 2,258,719 | (2,553 | ) | |||||||||||
3 | 10 Year U.S. Treasury Notes | Jun. 2020 | 417,188 | (1,020 | ) | |||||||||||
1 | Euro Schatz Index | Jun. 2020 | 123,058 | (105 | ) | |||||||||||
|
| |||||||||||||||
$ | (6,571 | ) | ||||||||||||||
|
|
Forward foreign currency exchange contracts outstanding at April 30, 2020:
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts: |
| |||||||||||||||||||||
Australian Dollar, | ||||||||||||||||||||||
Expiring��07/20/20 | Bank of America, N.A. | AUD | 45 | $ | 28,701 | $ | 29,132 | $ | 431 | $ | — | |||||||||||
Expiring 07/20/20 | Deutsche Bank AG | AUD | 49 | 31,131 | 32,146 | 1,015 | — | |||||||||||||||
Brazilian Real, | ||||||||||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 13,314 | 2,590,509 | 2,447,552 | — | (142,957 | ) | ||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 2,724 | 516,693 | 500,821 | — | (15,872 | ) | ||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 2,536 | 463,555 | 466,154 | 2,599 | — | |||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 1,404 | 269,927 | 258,083 | — | (11,844 | ) | ||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 800 | 152,159 | 146,996 | — | (5,163 | ) | ||||||||||||||
Expiring 05/05/20 | JPMorgan Chase Bank, N.A. | BRL | 575 | 110,653 | 105,708 | — | (4,945 | ) | ||||||||||||||
Expiring 06/02/20 | JPMorgan Chase Bank, N.A. | BRL | 1,437 | 265,002 | 263,537 | — | (1,465 | ) | ||||||||||||||
Expiring 06/02/20 | Morgan Stanley & Co. International PLC | BRL | 15,888 | 2,808,066 | 2,913,607 | 105,541 | — | |||||||||||||||
Chilean Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 271,920 | 320,000 | 326,104 | 6,104 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 261,385 | 305,000 | 313,470 | 8,470 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 126,970 | 147,222 | 152,271 | 5,049 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | CLP | 158,654 | 184,750 | 190,268 | 5,518 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 63,683 | 75,000 | 76,372 | 1,372 | — | |||||||||||||||
Chinese Renminbi, | ||||||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 2,032 | 290,123 | 287,070 | — | (3,053 | ) | ||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,587 | 224,000 | 224,169 | 169 | — | |||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,112 | 157,000 | 157,060 | 60 | — | |||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,091 | 154,000 | 154,122 | 122 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 5,418 | 773,699 | 765,242 | — | (8,457 | ) | ||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 3,009 | 434,000 | 425,032 | — | (8,968 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 19 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Chinese Renminbi (cont’d.), | ||||||||||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 2,554 | $ | 367,000 | $ | 360,739 | $ | — | $ | (6,261 | ) | ||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 1,357 | 191,000 | 191,626 | 626 | — | |||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | CNH | 1,514 | 214,000 | 213,789 | — | (211 | ) | ||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | CNH | 304 | 43,027 | 42,966 | — | (61 | ) | ||||||||||||||
Expiring 05/11/20 | Morgan Stanley & Co. International PLC | CNH | 1,330 | 188,000 | 187,870 | — | (130 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CNH | 3,296 | 466,398 | 465,069 | — | (1,329 | ) | ||||||||||||||
Expiring 05/14/21 | Citibank, N.A. | CNH | 4,640 | 664,965 | 648,676 | — | (16,289 | ) | ||||||||||||||
Colombian Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | COP | 4,210,849 | 1,108,264 | 1,059,040 | — | (49,224 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 509,670 | 127,000 | 128,183 | 1,183 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | COP | 1,287,978 | 319,201 | 323,929 | 4,728 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | COP | 690,540 | 170,000 | 173,673 | 3,673 | — | |||||||||||||||
Czech Koruna, | ||||||||||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | CZK | 36,527 | 1,453,165 | 1,478,405 | 25,240 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | CZK | 3,602 | 146,063 | 145,800 | — | (263 | ) | ||||||||||||||
Egyptian Pound, | ||||||||||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 1,685 | 103,319 | 106,210 | 2,891 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 1,723 | 105,493 | 107,273 | 1,780 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 1,040 | 64,227 | 64,791 | 564 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 628 | 38,396 | 39,099 | 703 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 603 | 36,396 | 37,554 | 1,158 | — | |||||||||||||||
Euro, | ||||||||||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | EUR | 32 | 34,970 | 35,280 | 310 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | EUR | 114 | 125,300 | 125,387 | 87 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | EUR | 34 | 37,756 | 37,687 | — | (69 | ) | ||||||||||||||
Hungarian Forint, | ||||||||||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | HUF | 58,002 | 180,409 | 180,127 | — | (282 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | HUF | 32,541 | 101,000 | 101,058 | 58 | — | |||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | HUF | 52,064 | 156,945 | 161,688 | 4,743 | — | |||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | HUF | 40,302 | 125,000 | 125,160 | 160 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | HUF | 207,094 | 624,341 | 643,137 | 18,796 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | HUF | 25 ,914 | 80,000 | 80,478 | 478 | — |
See Notes to Financial Statements.
20 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Indian Rupee, | ||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 32,649 | $ | 434,000 | $ | 430,018 | $ | — | $ | (3,982 | ) | ||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 19,216 | 246,000 | 253,097 | 7,097 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 16,013 | 209,000 | 210,902 | 1,902 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 15,680 | 202,000 | 206,524 | 4,524 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 14,982 | 192,000 | 197,324 | 5,324 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 13,187 | 171,000 | 173,681 | 2,681 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 12,232 | 158,000 | 161,103 | 3,103 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 11,617 | 151,000 | 153,013 | 2,013 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 11,218 | 144,000 | 147,750 | 3,750 | — | |||||||||||||||
Expiring 06/17/20 | The Toronto-Dominion Bank | INR | 17,437 | 239,041 | 229,663 | — | (9,378 | ) | ||||||||||||||
Indonesian Rupiah, | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 2,967,924 | 206,480 | 194,025 | — | (12,455 | ) | ||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 2,807,221 | 197,400 | 183,519 | — | (13,881 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | IDR | 9,900,000 | 584,416 | 647,202 | 62,786 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | IDR | 7,445,843 | 516,176 | 486,763 | — | (29,413 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | IDR | 3,384,853 | 217,000 | 221,281 | 4,281 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | IDR | 1,977,199 | 133,911 | 129,257 | — | (4,654 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 4,726,046 | 287,210 | 308,960 | 21,750 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 4,360,818 | 276,439 | 285,084 | 8,645 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 4,101,531 | 263,425 | 268,133 | 4,708 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 793,050 | 50,000 | 51,845 | 1,845 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | IDR | 3,554,186 | 248,631 | 232,350 | — | (16,281 | ) | ||||||||||||||
Israeli Shekel, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 1,565 | 437,000 | 449,657 | 12,657 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 1,186 | 327,000 | 340,622 | 13,622 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 409 | 115,200 | 117,610 | 2,410 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 349 | 99,000 | 100,154 | 1,154 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 21 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Israeli Shekel (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | ILS | 237 | $ | 67,523 | $ | 67,991 | $ | 468 | $ | — | |||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 441 | 126,000 | 126,634 | 634 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 142 | 39,612 | 40,920 | 1,308 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ILS | 397 | 110,494 | 113,910 | 3,416 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ILS | 871 | 250,000 | 250,187 | 187 | — | |||||||||||||||
Japanese Yen, | ||||||||||||||||||||||
Expiring 05/15/20 | Citibank, N.A. | JPY | 21,281 | 199,800 | 198,348 | — | (1,452 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | JPY | 34,418 | 321,083 | 321,125 | 42 | — | |||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | JPY | 9,895 | 92,300 | 92,322 | 22 | — | |||||||||||||||
Kazakhstani Tenge, | ||||||||||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | KZT | 54,565 | 141,536 | 127,904 | — | (13,632 | ) | ||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | KZT | 25,406 | 66,050 | 59,554 | — | (6,496 | ) | ||||||||||||||
Expiring 06/30/20 | Morgan Stanley & Co. International PLC | KZT | 28,804 | 60,831 | 66,375 | 5,544 | — | |||||||||||||||
Malaysian Ringgit, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 1,007 | 240,339 | 233,182 | — | (7,157 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 257 | 59,562 | 59,382 | — | (180 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MYR | 523 | 120,000 | 121,057 | 1,057 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MYR | 419 | 95,000 | 96,978 | 1,978 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MYR | 407 | 90,784 | 94,145 | 3,361 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MYR | 304 | 70,000 | 70,453 | 453 | — | |||||||||||||||
Mexican Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | MXN | 914 | 38,000 | 37,637 | — | (363 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 75,288 | 3,596,525 | 3,099,785 | — | (496,740 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 3,135 | 127,994 | 129,087 | 1,093 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MXN | 14,178 | 594,543 | 583,726 | — | (10,817 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MXN | 4,523 | 190,250 | 186,244 | — | (4,006 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 1,438 | 60,000 | 59,225 | — | (775 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | MXN | 29,053 | 1,185,302 | 1,196,168 | 10,866 | — |
See Notes to Financial Statements.
22 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
New Taiwanese Dollar, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TWD | 1,474 | $ | 49,640 | $ | 50,004 | $ | 364 | $ | — | |||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TWD | 968 | 32,576 | 32,846 | 270 | — | |||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | TWD | 5,395 | 182,249 | 182,961 | 712 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TWD | 8,476 | 282,587 | 287,477 | 4,890 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TWD | 1,083 | 36,440 | 36,715 | 275 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TWD | 984 | 33,045 | 33,378 | 333 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | TWD | 12,735 | 427,000 | 431,913 | 4,913 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | TWD | 1,263 | 42,459 | 42,838 | 379 | — | |||||||||||||||
New Zealand Dollar, | ||||||||||||||||||||||
Expiring 07/20/20 | Bank of America, N.A. | NZD | 57 | 33,843 | 34,790 | 947 | — | |||||||||||||||
Expiring 07/20/20 | JPMorgan Chase Bank, N.A. | NZD | 54 | 32,591 | 32,885 | 294 | — | |||||||||||||||
Peruvian Nuevo Sol, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | PEN | 221 | 62,974 | 65,220 | 2,246 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 705 | 210,000 | 208,213 | — | (1,787 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 563 | 164,000 | 166,311 | 2,311 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 237 | 69,203 | 70,123 | 920 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | PEN | 637 | 180,400 | 188,265 | 7,865 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PEN | 819 | 238,000 | 241,831 | 3,831 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PEN | 585 | 172,000 | 172,660 | 660 | — | |||||||||||||||
Philippine Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | PHP | 9,175 | 180,000 | 181,288 | 1,288 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 12,418 | 244,000 | 245,373 | 1,373 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 12,082 | 235,000 | 238,732 | 3,732 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 10,877 | 206,000 | 214,936 | 8,936 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 8,749 | 167,000 | 172,869 | 5,869 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 5,535 | 108,348 | 109,370 | 1,022 | — | |||||||||||||||
Polish Zloty, | ||||||||||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 1,900 | 458,517 | 457,829 | — | (688 | ) | ||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 799 | 189,542 | 192,585 | 3,043 | — | |||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 297 | 70,890 | 71,557 | 667 | — | |||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | PLN | 681 | 165,185 | 163,979 | — | (1,206 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | PLN | 760 | 181,622 | 183,031 | 1,409 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 23 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Polish Zloty (cont’d.), | ||||||||||||||||||||||
Expiring 07/17/20 | UBS AG | PLN | 9,264 | $ | 2,216,897 | $ | 2,232,308 | $ | 15,411 | $ | — | |||||||||||
Romanian Leu, | ||||||||||||||||||||||
Expiring 07/15/20 | Citibank, N.A. | RON | 1,012 | 225,775 | 226,954 | 1,179 | — | |||||||||||||||
Expiring 07/15/20 | Citibank, N.A. | RON | 231 | 52,000 | 51,845 | — | (155 | ) | ||||||||||||||
Expiring 07/15/20 | HSBC Bank USA, N.A. | RON | 557 | 124,043 | 124,752 | 709 | — | |||||||||||||||
Russian Ruble, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 54,627 | 819,300 | 728,199 | — | (91,101 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 7,752 | 100,000 | 103,333 | 3,333 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 53,800 | 744,615 | 717,176 | — | (27,439 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 2,295 | 30,559 | 30,588 | 29 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 1,990 | 26,745 | 26,533 | — | (212 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 1,613 | 19,982 | 21,505 | 1,523 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | RUB | 59,672 | 782,170 | 795,450 | 13,280 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | RUB | 14,779 | 196,000 | 197,006 | 1,006 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | RUB | 5,139 | 65,000 | 68,508 | 3,508 | — | |||||||||||||||
Singapore Dollar, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | SGD | 41 | 29,041 | 29,176 | 135 | — | |||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | SGD | 410 | 289,000 | 291,002 | 2,002 | — | |||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | SGD | 206 | 144,000 | 145,769 | 1,769 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | SGD | 604 | 427,000 | 428,248 | 1,248 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | SGD | 254 | 178,000 | 179,980 | 1,980 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | SGD | 232 | 164,000 | 164,326 | 326 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | SGD | 217 | 153,000 | 154,257 | 1,257 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | SGD | 239 | 168,000 | 169,193 | 1,193 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | SGD | 105 | 73,172 | 74,320 | 1,148 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | SGD | 840 | 606,159 | 595,616 | — | (10,543 | ) | ||||||||||||||
South African Rand, | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | ZAR | 1,387 | 88,434 | 74,480 | — | (13,954 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ZAR | 1,918 | 109,000 | 102,965 | — | (6,035 | ) | ||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | ZAR | 14,807 | 806,325 | 794,898 | — | (11,427 | ) | ||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | ZAR | 4,514 | 239,892 | 242,331 | 2,439 | — | |||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | ZAR | 2,998 | 160,211 | 160,971 | 760 | — | |||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | ZAR | 2,688 | 148,770 | 144,299 | — | (4,471 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 5,183 | 334,043 | 278,259 | — | (55,784 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 1,623 | 93,000 | 87,135 | — | (5,865 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 858 | 45,397 | 46,073 | 676 | — |
See Notes to Financial Statements.
24 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
South African Rand (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | ZAR | 10,109 | $ | 632,993 | $ | 542,670 | $ | — | $ | (90,323 | ) | ||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | ZAR | 1,607 | 97,364 | 86,273 | — | (11,091 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | ZAR | 13,476 | 806,158 | 723,462 | — | (82,696 | ) | ||||||||||||||
South Korean Won, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 206,944 | 171,000 | 170,480 | — | (520 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 147,076 | 121,000 | 121,160 | 160 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 74,349 | 61,460 | 61,248 | — | (212 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 48,196 | 39,129 | 39,704 | 575 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 47,248 | 39,679 | 38,922 | — | (757 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | KRW | 33,448 | 27,360 | 27,554 | 194 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | KRW | 444,848 | 362,254 | 366,464 | 4,210 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | KRW | 67,030 | 54,908 | 55,219 | 311 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 241,860 | 200,000 | 199,243 | — | (757 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 126,064 | 103,811 | 103,851 | 40 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 58,325 | 47,959 | 48,048 | 89 | — | |||||||||||||||
Thai Baht, | ||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | THB | 3,604 | 110,000 | 111,380 | 1,380 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | THB | 8,609 | 263,000 | 266,076 | 3,076 | — | |||||||||||||||
Expiring 06/17/20 | Credit Suisse International | THB | 5,247 | 160,000 | 162,173 | 2,173 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 36,656 | 1,164,870 | 1,132,947 | — | (31,923 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 7,102 | 218,000 | 219,522 | 1,522 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 6,422 | 196,040 | 198,493 | 2,453 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 5,330 | 164,000 | 164,729 | 729 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,464 | 105,700 | 107,052 | 1,352 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 1,959 | 60,000 | 60,547 | 547 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | THB | 4,589 | 140,000 | 141,829 | 1,829 | — | |||||||||||||||
Turkish Lira, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 1,097 | 158,000 | 155,106 | — | (2,894 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 672 | 96,000 | 94,948 | — | (1,052 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 411 | 59,000 | 58,132 | — | (868 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | TRY | 2,687 | 387,541 | 379,817 | — | (7,724 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | TRY | 1,502 | 215,029 | 212,329 | — | (2,700 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 25 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Turkish Lira (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | TRY | 544 | $ | 78,362 | $ | 76,822 | $ | — | $ | (1,540 | ) | ||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | TRY | 1,059 | 157,301 | 149,707 | — | (7,594 | ) | ||||||||||||||
Ukraine Hryvna, | ||||||||||||||||||||||
Expiring 06/16/20 | Bank of America, N.A. | UAH | 1,175 | 41,384 | 42,632 | 1,248 | — | |||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||
$ | 52,275,625 | $ | 51,427,459 | 533,657 | (1,381,823 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts: |
| |||||||||||||||||||||
Australian Dollar, | ||||||||||||||||||||||
Expiring 07/20/20 | HSBC Bank USA, N.A. | AUD | 1,091 | $ | 698,451 | $ | 711,359 | $ | — | $ | (12,908 | ) | ||||||||||
Brazilian Real, | ||||||||||||||||||||||
Expiring 05/05/20 | Bank of America, N.A. | BRL | 311 | 59,650 | 57,085 | 2,565 | — | |||||||||||||||
Expiring 05/05/20 | Barclays Bank PLC | BRL | 273 | 51,950 | 50,194 | 1,756 | — | |||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 1,405 | 280,000 | 258,361 | 21,639 | — | |||||||||||||||
Expiring 05/05/20 | Citibank, N.A. | BRL | 256 | 50,461 | 47,013 | 3,448 | — | |||||||||||||||
Expiring 05/05/20 | Goldman Sachs International | BRL | 727 | 138,172 | 133,666 | 4,506 | — | |||||||||||||||
Expiring 05/05/20 | Goldman Sachs International | BRL | 658 | 126,879 | 120,980 | 5,899 | — | |||||||||||||||
Expiring 05/05/20 | HSBC Bank USA, N.A. | BRL | 697 | 137,300 | 128,216 | 9,084 | — | |||||||||||||||
Expiring 05/05/20 | JPMorgan Chase Bank, N.A. | BRL | 705 | 132,721 | 129,643 | 3,078 | — | |||||||||||||||
Expiring 05/05/20 | Morgan Stanley & Co. International PLC | BRL | 15,888 | 2,814,334 | 2,920,701 | — | (106,367 | ) | ||||||||||||||
Expiring 05/05/20 | Morgan Stanley & Co. International PLC | BRL | 227 | 43,072 | 41,765 | 1,307 | — | |||||||||||||||
Expiring 05/05/20 | Morgan Stanley & Co. International PLC | BRL | 205 | 39,376 | 37,690 | 1,686 | — | |||||||||||||||
Expiring 06/02/20 | Barclays Bank PLC | BRL | 313 | 55,285 | 57,382 | — | (2,097 | ) | ||||||||||||||
Canadian Dollar, | ||||||||||||||||||||||
Expiring 07/20/20 | Morgan Stanley & Co. International PLC | CAD | 172 | 121,819 | 123,439 | — | (1,620 | ) | ||||||||||||||
Chilean Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 62,280 | 72,360 | 74,690 | — | (2,330 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 45,281 | 54,222 | 54,304 | — | (82 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | CLP | 740,179 | 886,389 | 887,670 | — | (1,281 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | CLP | 133,736 | 161,137 | 160,384 | 753 | — |
See Notes to Financial Statements.
26 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Chilean Peso (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 1,047,261 | $ | 1,252,555 | $ | 1,255,943 | $ | — | $ | (3,388 | ) | ||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 119,871 | 147,000 | 143,757 | 3,243 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 87,843 | 103,811 | 105,347 | — | (1,536 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 78,655 | 93,000 | 94,328 | — | (1,328 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 41,033 | 47,959 | 49,210 | — | (1,251 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | CLP | 139,780 | 164,000 | 167,634 | — | (3,634 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | CLP | 139,679 | 167,000 | 167,512 | — | (512 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | CLP | 85,734 | 101,000 | 102,818 | — | (1,818 | ) | ||||||||||||||
Expiring 06/17/20 | The Toronto-Dominion Bank | CLP | 409,242 | 485,459 | 490,789 | — | (5,330 | ) | ||||||||||||||
Chinese Renminbi, | ||||||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 2,677 | 380,000 | 378,157 | 1,843 | — | |||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,713 | 241,000 | 242,016 | — | (1,016 | ) | ||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 709 | 101,690 | 100,175 | 1,515 | — | |||||||||||||||
Expiring 05/11/20 | Credit Suisse International | CNH | 1,847 | 260,000 | 260,867 | — | (867 | ) | ||||||||||||||
Expiring 05/11/20 | Credit Suisse International | CNH | 1,288 | 181,000 | 181,857 | — | (857 | ) | ||||||||||||||
Expiring 05/11/20 | Goldman Sachs International | CNH | 2,437 | 347,000 | 344,266 | 2,734 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 2,892 | 412,000 | 408,464 | 3,536 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 2,522 | 355,000 | 356,192 | — | (1,192 | ) | ||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 2,123 | 303,100 | 299,842 | 3,258 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 2,034 | 291,000 | 287,313 | 3,687 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 1,320 | 188,000 | 186,460 | 1,540 | — | |||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 513 | 72,332 | 72,431 | — | (99 | ) | ||||||||||||||
Expiring 05/11/20 | Morgan Stanley & Co. International PLC | CNH | 730 | 102,400 | 103,116 | — | (716 | ) | ||||||||||||||
Expiring 05/11/20 | The Toronto-Dominion Bank | CNH | 5,566 | 787,560 | 786,226 | 1,334 | — | |||||||||||||||
Expiring 05/14/21 | JPMorgan Chase Bank, N.A. | CNH | 4,640 | 666,044 | 648,677 | 17,367 | — | |||||||||||||||
Colombian Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | COP | 152,034 | 39,883 | 38,237 | 1,646 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 27 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Colombian Peso (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | COP | 143,566 | $ | 35,748 | $ | 36,107 | $ | — | $ | (359 | ) | ||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 2,455,837 | 599,716 | 617,650 | — | (17,934 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 860,408 | 219,000 | 216,395 | 2,605 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 480,155 | 122,000 | 120,760 | 1,240 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 287,337 | 71,000 | 72,266 | — | (1,266 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 221,200 | 56,000 | 55,632 | 368 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 188,480 | 54,559 | 47,403 | 7,156 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | COP | 685,116 | 197,400 | 172,309 | 25,091 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | COP | 519,665 | 134,000 | 130,697 | 3,303 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | COP | 371,284 | 93,947 | 93,379 | 568 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | COP | 247,803 | 70,929 | 62,323 | 8,606 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | COP | 573,668 | 147,000 | 144,279 | 2,721 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | COP | 158,025 | 38,580 | 39,743 | — | (1,163 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | COP | 282,245 | 72,476 | 70,985 | 1,491 | — | |||||||||||||||
Expiring 06/17/20 | UBS AG | COP | 276,600 | 68,000 | 69,566 | — | (1,566 | ) | ||||||||||||||
Czech Koruna, | ||||||||||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | CZK | 1,116 | 44,150 | 45,153 | — | (1,003 | ) | ||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | CZK | 1,104 | 44,599 | 44,683 | — | (84 | ) | ||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | CZK | 829 | 33,245 | 33,549 | — | (304 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | CZK | 1,731 | 69,045 | 70,046 | — | (1,001 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | CZK | 705 | 27,936 | 28,528 | — | (592 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | CZK | 2,028 | 81,826 | 82,090 | — | (264 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | CZK | 1,608 | 65,814 | 65,091 | 723 | — | |||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | CZK | 2,131 | 85,000 | 86,242 | — | (1,242 | ) | ||||||||||||||
Egyptian Pound, | ||||||||||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 1,251 | 78,346 | 78,871 | — | (525 | ) | ||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 434 | 27,233 | 27,338 | — | (105 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 1,827 | 113,131 | 113,772 | — | (641 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 1,340 | 82,544 | 83,423 | — | (879 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 827 | 51,105 | 51,522 | — | (417 | ) | ||||||||||||||
Euro, | ||||||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | EUR | 445 | 482,580 | 488,613 | — | (6,033 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | EUR | 296 | 323,417 | 324,419 | — | (1,002 | ) |
See Notes to Financial Statements.
28 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Euro (cont’d.), | ||||||||||||||||||||||
Expiring 07/17/20 | BNP Paribas S.A. | EUR | 12 | $ | 12,971 | $ | 13,172 | $ | — | $ | (201 | ) | ||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | EUR | 288 | 314,264 | 316,285 | — | (2,021 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | EUR | 52 | 56,600 | 57,350 | — | (750 | ) | ||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | EUR | 288 | 314,148 | 316,285 | — | (2,137 | ) | ||||||||||||||
Hungarian Forint, | ||||||||||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | HUF | 14,967 | 45,878 | 46,479 | — | (601 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | HUF | 50,110 | 151,000 | 155,618 | — | (4,618 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | HUF | 31,861 | 97,000 | 98,947 | — | (1,947 | ) | ||||||||||||||
Expiring 07/17/20 | BNP Paribas S.A. | HUF | 14,220 | 43,849 | 44,160 | — | (311 | ) | ||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | HUF | 20,467 | 61,853 | 63,560 | — | (1,707 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | HUF | 12,203 | 36,991 | 37,897 | — | (906 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | HUF | 26,103 | 79,000 | 81,064 | — | (2,064 | ) | ||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | HUF | 28,378 | 86,000 | 88,128 | — | (2,128 | ) | ||||||||||||||
Indian Rupee, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | INR | 3,489 | 45,124 | 45,956 | — | (832 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | INR | 2,085 | 27,026 | 27,461 | — | (435 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | INR | 8,482 | 108,673 | 111,715 | — | (3,042 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | INR | 2,697 | 34,514 | 35,519 | — | (1,005 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | INR | 3,698 | 47,474 | 48,707 | — | (1,233 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 17,526 | 225,258 | 230,834 | — | (5,576 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 11,002 | 140,850 | 144,904 | — | (4,054 | ) | ||||||||||||||
Indonesian Rupiah, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | IDR | 1,680,154 | 101,612 | 109,838 | — | (8,226 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 4,718,289 | 294,433 | 308,453 | — | (14,020 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 2,640,330 | 165,000 | 172,609 | — | (7,609 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 1,538,446 | 107,000 | 100,574 | 6,426 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 1,296,629 | 81,376 | 84,766 | — | (3,390 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 912,163 | 57,171 | 59,632 | — | (2,461 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 549,611 | 34,545 | 35,930 | — | (1,385 | ) | ||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 3,421,121 | 209,000 | 223,652 | — | (14,652 | ) | ||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 2,151,594 | 125,000 | 140,658 | — | (15,658 | ) | ||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 1,946,646 | 117,000 | 127,260 | — | (10,260 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | IDR | 21,333,669 | 1,238,889 | 1,394,664 | — | (155,775 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | IDR | 1,712,969 | 107,094 | 111,983 | — | (4,889 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 29 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Indonesian Rupiah (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | IDR | 943,432 | $ | 59,205 | $ | 61,676 | $ | — | $ | (2,471 | ) | ||||||||||
Expiring 06/17/20 | Goldman Sachs International | IDR | 1,193,970 | 80,619 | 78,054 | 2,565 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | IDR | 1,504,658 | 94,000 | 98,365 | — | (4,365 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 5,116,784 | 337,052 | 334,504 | 2,548 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 2,121,669 | 131,658 | 138,702 | — | (7,044 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | IDR | 1,231,064 | 74,000 | 80,479 | — | (6,479 | ) | ||||||||||||||
Israeli Shekel, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 1,192 | 311,000 | 342,315 | — | (31,315 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 1,715 | 489,000 | 492,752 | — | (3,752 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 967 | 265,000 | 277,828 | — | (12,828 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 264 | 75,020 | 75,739 | — | (719 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | ILS | 938 | 265,980 | 269,446 | — | (3,466 | ) | ||||||||||||||
Japanese Yen, | ||||||||||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | JPY | 4,929 | 45,799 | 45,992 | — | (193 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | JPY | 21,876 | 201,510 | 204,105 | — | (2,595 | ) | ||||||||||||||
Malaysian Ringgit, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 666 | 153,714 | 154,125 | — | (411 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 577 | 132,581 | 133,500 | — | (919 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 232 | 53,788 | 53,750 | 38 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 200 | 45,664 | 46,247 | — | (583 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | MYR | 134 | 30,303 | 30,906 | — | (603 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MYR | 382 | 87,736 | 88,446 | — | (710 | ) | ||||||||||||||
Mexican Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | MXN | 2,656 | 106,200 | 109,357 | — | (3,157 | ) | ||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | MXN | 1,994 | 82,541 | 82,110 | 431 | — | |||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | MXN | 1,254 | 51,033 | 51,647 | — | (614 | ) | ||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | MXN | 1,094 | 46,116 | 45,056 | 1,060 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 4,462 | 180,000 | 183,699 | — | (3,699 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 3,133 | 138,000 | 128,990 | 9,010 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 2,550 | 102,927 | 104,989 | — | (2,062 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 1,819 | 74,412 | 74,907 | — | (495 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 1,636 | 76,538 | 67,342 | 9,196 | — | |||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | MXN | 1,739 | 71,228 | 71,614 | — | (386 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | MXN | 25,362 | 1,030,395 | 1,044,211 | — | (13,816 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | MXN | 1,669 | 69,450 | 68,698 | 752 | — |
See Notes to Financial Statements.
30 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Mexican Peso (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | MXN | 1,176 | $ | 48,236 | $ | 48,431 | $ | — | $ | (195 | ) | ||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 8,199 | 349,500 | 337,572 | 11,928 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 5,352 | 220,261 | 220,342 | — | (81 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 4,160 | 196,053 | 171,294 | 24,759 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 2,392 | 97,100 | 98,493 | — | (1,393 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 2,070 | 86,970 | 85,246 | 1,724 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 1,049 | 42,600 | 43,189 | — | (589 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | MXN | 1,302 | 53,600 | 53,626 | — | (26 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | MXN | 5,853 | 275,000 | 240,998 | 34,002 | — | |||||||||||||||
New Taiwanese Dollar, | ||||||||||||||||||||||
Expiring 06/17/20 | Credit Suisse International | TWD | 13,066 | 439,000 | 443,143 | — | (4,143 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | TWD | 10,934 | 368,000 | 370,849 | — | (2,849 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | TWD | 17,592 | 594,000 | 596,644 | — | (2,644 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | TWD | 15,879 | 536,000 | 538,550 | — | (2,550 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | TWD | 9,652 | 324,000 | 327,354 | — | (3,354 | ) | ||||||||||||||
New Zealand Dollar, | ||||||||||||||||||||||
Expiring 07/20/20 | JPMorgan Chase Bank, N.A. | NZD | 739 | 442,905 | 452,801 | — | (9,896 | ) | ||||||||||||||
Peruvian Nuevo Sol, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | PEN | 199 | 58,301 | 58,895 | — | (594 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 3,201 | 931,692 | 945,369 | — | (13,677 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 278 | 81,905 | 82,135 | — | (230 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 158 | 46,197 | 46,627 | — | (430 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | PEN | 354 | 103,723 | 104,474 | — | (751 | ) | ||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | PEN | 208 | 61,311 | 61,465 | — | (154 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PEN | 122 | 36,111 | 36,166 | — | (55 | ) | ||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | PEN | 227 | 67,158 | 67,069 | 89 | — | |||||||||||||||
Philippine Peso, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | PHP | 1,608 | 31,508 | 31,771 | — | (263 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 31 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Philippine Peso (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | PHP | 2,245 | $ | 44,050 | $ | 44,371 | $ | — | $ | (321 | ) | ||||||||||
Expiring 06/17/20 | Barclays Bank PLC | PHP | 2,149 | 42,187 | 42,462 | — | (275 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PHP | 5,537 | 106,510 | 109,409 | — | (2,899 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | PHP | 13,035 | 252,000 | 257,571 | — | (5,571 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | PHP | 9,043 | 178,000 | 178,694 | — | (694 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 13,040 | 255,000 | 257,677 | — | (2,677 | ) | ||||||||||||||
Polish Zloty, | ||||||||||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 365 | 87,390 | 87,959 | — | (569 | ) | ||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 260 | 62,664 | 62,730 | — | (66 | ) | ||||||||||||||
Expiring 07/17/20 | Bank of America, N.A. | PLN | 201 | 47,847 | 48,389 | — | (542 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | PLN | 674 | 161,000 | 162,477 | — | (1,477 | ) | ||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | PLN | 541 | 129,000 | 130,284 | — | (1,284 | ) | ||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | PLN | 298 | 71,221 | 71,753 | — | (532 | ) | ||||||||||||||
Expiring 07/17/20 | Deutsche Bank AG | PLN | 167 | 39,707 | 40,140 | — | (433 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | PLN | 481 | 115,127 | 115,832 | — | (705 | ) | ||||||||||||||
Expiring 07/17/20 | HSBC Bank USA, N.A. | PLN | 156 | 37,073 | 37,513 | — | (440 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | PLN | 829 | 200,000 | 199,644 | 356 | — | |||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | PLN | 803 | 192,789 | 193,563 | — | (774 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | PLN | 612 | 148,091 | 147,577 | 514 | — | |||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | PLN | 429 | 103,000 | 103,396 | — | (396 | ) | ||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | PLN | 386 | 92,300 | 93,048 | — | (748 | ) | ||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | PLN | 386 | 92,000 | 93,089 | — | (1,089 | ) | ||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | PLN | 354 | 85,000 | 85,286 | — | (286 | ) | ||||||||||||||
Romanian Leu, | ||||||||||||||||||||||
Expiring 07/15/20 | Bank of America, N.A. | RON | 150 | 33,241 | 33,647 | — | (406 | ) | ||||||||||||||
Expiring 07/15/20 | Citibank, N.A. | RON | 121 | 26,780 | 27,154 | — | (374 | ) | ||||||||||||||
Expiring 07/15/20 | HSBC Bank USA, N.A. | RON | 172 | 38,256 | 38,568 | — | (312 | ) | ||||||||||||||
Expiring 07/15/20 | JPMorgan Chase Bank, N.A. | RON | 220 | 49,005 | 49,385 | — | (380 | ) | ||||||||||||||
Expiring 07/15/20 | JPMorgan Chase Bank, N.A. | RON | 201 | 45,072 | 45,149 | — | (77 | ) | ||||||||||||||
Russian Ruble, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | RUB | 4,042 | 52,902 | 53,885 | — | (983 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 15,217 | 199,700 | 202,844 | — | (3,144 | ) |
See Notes to Financial Statements.
32 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Russian Ruble (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 7,319 | $ | 100,092 | $ | 97,572 | $ | 2,520 | $ | — | |||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 6,686 | 88,440 | 89,134 | — | (694 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 5,614 | 72,360 | 74,831 | — | (2,471 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 4,988 | 63,000 | 66,497 | — | (3,497 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 4,875 | 64,925 | 64,980 | — | (55 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 13,142 | 165,000 | 175,192 | — | (10,192 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 7,694 | 98,974 | 102,568 | — | (3,594 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 5,375 | 71,587 | 71,657 | — | (70 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 4,154 | 55,568 | 55,371 | 197 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | RUB | 10,906 | 148,428 | 145,383 | 3,045 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | RUB | 25,925 | 348,000 | 345,593 | 2,407 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | RUB | 13,647 | 186,285 | 181,918 | 4,367 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | RUB | 3,940 | 52,953 | 52,518 | 435 | — | |||||||||||||||
Singapore Dollar, | ||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | SGD | 461 | 332,000 | 327,106 | 4,894 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | SGD | 370 | 259,000 | 262,284 | — | (3,284 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | SGD | 41 | 28,747 | 29,048 | — | (301 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | SGD | 470 | 334,800 | 333,271 | 1,529 | — | |||||||||||||||
South African Rand, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | ZAR | 4,735 | 258,000 | 254,215 | 3,785 | — | |||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | ZAR | 1,287 | 67,394 | 69,099 | — | (1,705 | ) | ||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | ZAR | 730 | 40,495 | 39,192 | 1,303 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ZAR | 1,260 | 66,000 | 67,660 | — | (1,660 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ZAR | 1,143 | 60,000 | 61,377 | — | (1,377 | ) | ||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ZAR | 935 | 50,684 | 50,196 | 488 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ZAR | 2,323 | 127,000 | 124,685 | 2,315 | — | |||||||||||||||
Expiring 06/17/20 | Deutsche Bank AG | ZAR | 624 | 32,841 | 33,494 | — | (653 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 13,370 | 736,243 | 717,748 | 18,495 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 2,911 | 160,189 | 156,291 | 3,898 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 1,465 | 79,259 | 78,628 | 631 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 1,317 | 72,945 | 70,677 | 2,268 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 1,019 | 65,539 | 54,710 | 10,829 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 72,065 | 4,485,390 | 3,868,740 | 616,650 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 3,720 | 202,000 | 199,729 | 2,271 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 33 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
South African Rand (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 2,974 | $ | 158,066 | $ | 159,632 | $ | — | $ | (1,566 | ) | ||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | ZAR | 3,048 | 197,715 | 163,618 | 34,097 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | ZAR | 1,433 | 76,000 | 76,949 | — | (949 | ) | ||||||||||||||
South Korean Won, | ||||||||||||||||||||||
Expiring 06/17/20 | Credit Suisse International | KRW | 1,763,348 | 1,491,847 | 1,452,638 | 39,209 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | KRW | 222,598 | 181,000 | 183,375 | — | (2,375 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | KRW | 162,307 | 132,000 | 133,708 | — | (1,708 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 235,165 | 198,602 | 193,728 | 4,874 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | KRW | 235,760 | 198,602 | 194,218 | 4,384 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | KRW | 231,226 | 195,342 | 190,483 | 4,859 | — | |||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | KRW | 201,479 | 163,000 | 165,978 | — | (2,978 | ) | ||||||||||||||
Expiring 06/17/20 | UBS AG | KRW | 235,542 | 198,602 | 194,038 | 4,564 | — | |||||||||||||||
Thai Baht, | ||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | THB | 2,522 | 76,984 | 77,950 | — | (966 | ) | ||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | THB | 3,618 | 115,000 | 111,811 | 3,189 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | THB | 9,522 | 290,225 | 294,296 | — | (4,071 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | THB | 1,269 | 40,273 | 39,218 | 1,055 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | THB | 1,203 | 37,142 | 37,167 | — | (25 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | THB | 1,030 | 31,876 | 31,849 | 27 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | THB | 8,242 | 263,000 | 254,756 | 8,244 | — | |||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | THB | 5,701 | 172,110 | 176,200 | — | (4,090 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 8,138 | 256,000 | 251,514 | 4,486 | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 892 | 27,487 | 27,562 | — | (75 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | THB | 12,454 | 395,000 | 384,925 | 10,075 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | THB | 7,781 | 240,000 | 240,502 | — | (502 | ) | ||||||||||||||
Turkish Lira, | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 2,480 | 355,163 | 350,510 | 4,653 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 1,709 | 270,000 | 241,528 | 28,472 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 1,182 | 185,679 | 167,097 | 18,582 | — | |||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 1,079 | 160,189 | 152,476 | 7,713 | — |
See Notes to Financial Statements.
34 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||
Turkish Lira (cont’d.), | ||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 1,048 | $ | 166,678 | $ | 148,124 | $ | 18,554 | $ | — | |||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 571 | 80,000 | 80,707 | — | (707 | ) | ||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TRY | 886 | 140,646 | 125,217 | 15,429 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TRY | 487 | 68,961 | 68,863 | 98 | — | |||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TRY | 217 | 30,132 | 30,710 | — | (578 | ) | ||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | TRY | 539 | 79,891 | 76,137 | 3,754 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | TRY | 1,138 | 174,000 | 160,891 | 13,109 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | TRY | 1,115 | 171,298 | 157,615 | 13,683 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | TRY | 328 | 46,765 | 46,298 | 467 | — | |||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | TRY | 255 | 35,777 | 36,106 | — | (329 | ) | ||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||
$ | 50,885,992 | $ | 50,388,378 | 1,182,598 | (684,984 | ) | ||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||
$ | 1,716,255 | $ | (2,066,807 | ) | ||||||||||||||||||
|
|
|
|
Cross currency exchange contracts outstanding at April 30, 2020:
Settlement | Type | Notional Amount (000) | In Exchange For (000) | Unrealized Appreciation | Unrealized Depreciation | Counterparty | ||||||||||||||||
OTC Cross Currency Exchange Contracts: |
| |||||||||||||||||||||
07/17/20 | Buy | EUR | 271 | CZK | 7,353 | $ | 180 | $ | — | Citibank, N.A. | ||||||||||||
|
|
|
|
Interest rate swap agreements outstanding at April 30, 2020:
Notional Amount (000)# | Termination Date | Fixed Rate | Floating Rate | Value at Trade Date | Value at April 30, 2020 | Unrealized Appreciation (Depreciation) | ||||||||||||||||||
Centrally Cleared Interest Rate Swap Agreements: | ||||||||||||||||||||||||
BRL | 6,947 | 01/02/23 | 5.690 | %(T) | 1 Day BROIS(2)(T) | $ | — | $ | 42,415 | $ | 42,415 | |||||||||||||
BRL | 5,769 | 01/02/25 | 5.755 | %(T) | 1 Day BROIS(2)(T) | — | (29,351 | ) | (29,351 | ) | ||||||||||||||
BRL | 1,478 | 01/02/25 | 5.840 | %(T) | 1 Day BROIS(2)(T) | — | (4,635 | ) | (4,635 | ) | ||||||||||||||
BRL | 1,369 | 01/02/25 | 6.000 | %(T) | 1 Day BROIS(1)(T) | (1,680 | ) | 4,040 | 5,720 | |||||||||||||||
BRL | 2,354 | 01/02/25 | 6.725 | %(T) | 1 Day BROIS(2)(T) | — | 8,263 | 8,263 | ||||||||||||||||
BRL | 1,016 | 01/02/25 | 7.098 | %(T) | 1 Day BROIS(2)(T) | — | 6,653 | 6,653 | ||||||||||||||||
BRL | 1,294 | 01/04/27 | 7.330 | %(T) | 1 Day BROIS(2)(T) | — | 7,785 | 7,785 | ||||||||||||||||
CNH | 4,510 | 03/13/24 | 2.945 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | 5 | 30,520 | 30,515 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 35 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Interest rate swap agreements outstanding at April 30, 2020 (continued):
Notional | Termination Date | Fixed Rate | Floating Rate | Value at Trade Date | Value at April 30, 2020 | Unrealized Appreciation (Depreciation) | ||||||||||||||||||
Centrally Cleared Interest Rate Swap Agreements (cont’d.): | ||||||||||||||||||||||||
CNH | 2,320 | 04/10/24 | 3.100 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | $ | — | $ | 17,599 | $ | 17,599 | |||||||||||||
CNH | 1,645 | 04/22/24 | 3.170 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | — | 13,051 | 13,051 | ||||||||||||||||
CNH | 3,530 | 06/05/24 | 2.925 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | 4 | 24,448 | 24,444 | ||||||||||||||||
CNH | 12,235 | 06/19/24 | 2.875 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | — | 81,203 | 81,203 | ||||||||||||||||
CNH | 11,500 | 03/18/25 | 2.345 | %(Q) | 7 Day China Fixing Repo Rates(2)(Q) | — | 43,501 | 43,501 | ||||||||||||||||
CNH | 26,780 | 03/18/25 | 2.450 | %(Q) | 7 Day China Fixing Repo Rates(1)(Q) | — | (120,370 | ) | (120,370 | ) | ||||||||||||||
COP | 950,000 | 12/12/23 | 5.530 | %(Q) | 1 Day COOIS(2)(Q) | — | 18,473 | 18,473 | ||||||||||||||||
COP | 7,442,000 | 12/19/24 | 4.900 | %(Q) | 1 Day COOIS(1)(Q) | (10,911 | ) | (103,990 | ) | (93,079 | ) | |||||||||||||
COP | 2,400,000 | 03/03/25 | 4.525 | %(Q) | 1 Day COOIS(1)(Q) | — | (23,044 | ) | (23,044 | ) | ||||||||||||||
COP | 5,300,000 | 03/27/25 | 4.300 | %(Q) | 1 Day COOIS(2)(Q) | 5,242 | 36,108 | 30,866 | ||||||||||||||||
COP | 900,000 | 04/24/25 | 3.830 | %(Q) | 1 Day COOIS(2)(Q) | — | 931 | 931 | ||||||||||||||||
COP | 1,800,000 | 04/28/25 | 3.830 | %(Q) | 1 Day COOIS(2)(Q) | (285 | ) | 1,802 | 2,087 | |||||||||||||||
CZK | 3,790 | 02/03/30 | 1.515 | %(A) | 6 Month PRIBOR(2)(S) | — | 10,385 | 10,385 | ||||||||||||||||
INR | 50,000 | 04/22/25 | 4.110 | %(S) | 1 Day MIBOR(2)(S) | — | (1,100 | ) | (1,100 | ) | ||||||||||||||
KRW | 800,000 | 06/26/24 | 1.385 | %(Q) | 3 Month KWCDC(2)(Q) | (875 | ) | 11,697 | 12,572 | |||||||||||||||
KRW | 800,000 | 12/20/24 | 1.363 | %(Q) | 3 Month KWCDC(2)(Q) | 8 | 12,035 | 12,027 | ||||||||||||||||
KRW | 1,200,000 | 01/20/25 | 1.425 | %(Q) | 3 Month KWCDC(2)(Q) | 8 | 20,795 | 20,787 | ||||||||||||||||
KRW | 800,000 | 04/03/25 | 1.078 | %(Q) | 3 Month KWCDC(2)(Q) | 1,101 | 3,259 | 2,158 | ||||||||||||||||
KRW | 300,000 | 04/23/25 | 0.975 | %(Q) | 3 Month KWCDC(2)(Q) | 1 | (4 | ) | (5 | ) | ||||||||||||||
MXN | 20,156 | 03/20/24 | 7.703 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 4,663 | 74,977 | 70,314 | ||||||||||||||||
MXN | 26,530 | 10/30/24 | 6.413 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 15,795 | 47,552 | 31,757 | ||||||||||||||||
MXN | 27,450 | 02/03/25 | 6.405 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | — | 48,378 | 48,378 | ||||||||||||||||
MXN | 6,470 | 02/26/25 | 6.145 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 11 | 8,368 | 8,357 | ||||||||||||||||
MXN | 1,757 | 03/03/25 | 6.090 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 3 | 2,058 | 2,055 | ||||||||||||||||
MXN | 1,757 | 03/03/25 | 6.140 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 3 | 2,221 | 2,218 | ||||||||||||||||
MXN | 8,700 | 04/16/25 | 5.650 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 9 | 2,853 | 2,844 | ||||||||||||||||
MXN | 10,145 | 05/16/29 | 7.980 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | — | 54,928 | 54,928 | ||||||||||||||||
MXN | 4,105 | 05/22/29 | 8.075 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | 989 | 23,559 | 22,570 |
See Notes to Financial Statements.
36 |
Interest rate swap agreements outstanding at April 30, 2020 (continued):
Notional | Termination Date | Fixed Rate | Floating Rate | Value at Trade Date | Value at April 30, 2020 | Unrealized Appreciation (Depreciation) | ||||||||||||||||||
Centrally Cleared Interest Rate Swap Agreements (cont’d.): | ||||||||||||||||||||||||
MXN | 4,060 | 12/24/29 | 6.780 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | $ | 5 | $ | 6,560 | $ | 6,555 | |||||||||||||
MXN | 16,040 | 01/28/30 | 6.640 | %(M) | 28 Day Mexican Interbank Rate(2)(M) | — | 18,261 | 18,261 | ||||||||||||||||
PLN | 3,430 | 09/21/22 | 2.312 | %(A) | 6 Month WIBOR(2)(S) | — | 47,123 | 47,123 | ||||||||||||||||
PLN | 2,700 | 07/24/24 | 1.798 | %(A) | 6 Month WIBOR(2)(S) | — | 40,434 | 40,434 | ||||||||||||||||
PLN | 3,430 | 04/08/25 | 0.750 | %(A) | 6 Month WIBOR(1)(S) | 197 | (6,726 | ) | (6,923 | ) | ||||||||||||||
ZAR | 34,875 | 04/09/22 | 5.420 | %(Q) | 3 Month JIBAR(1)(Q) | (58 | ) | (33,747 | ) | (33,689 | ) | |||||||||||||
ZAR | 21,501 | 03/24/25 | 7.420 | %(Q) | 3 Month JIBAR(2)(Q) | (836 | ) | 79,453 | 80,289 | |||||||||||||||
ZAR | 9,800 | 03/06/30 | 7.540 | %(Q) | 3 Month JIBAR(1)(Q) | 73 | 12,961 | 12,888 | ||||||||||||||||
ZAR | 9,460 | 04/09/30 | 8.940 | %(Q) | 3 Month JIBAR(2)(Q) | (290 | ) | 40,265 | 40,555 | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||
$ | 13,182 | $ | 581,947 | $ | 568,765 | |||||||||||||||||||
|
|
|
|
|
|
Notional | Termination Date | Fixed Rate | Floating Rate | Fair Value | Upfront Premiums Paid (Received) | Unrealized Appreciation (Depreciation) | Counterparty | |||||||||||||||||||||
OTC Interest Rate Swap Agreements: | ||||||||||||||||||||||||||||
MYR | 3,700 | 01/17/25 | 3.235%(Q) | 3 Month KLIBOR(1)(Q) | $ | (40,585 | ) | $ | (12 | ) | $ | (40,573 | ) | | Morgan Stanley & Co. International PLC | | ||||||||||||
MYR | 3,700 | 02/06/25 | 2.938%(Q) | 3 Month KLIBOR(1)(Q) | (28,920 | ) | (15 | ) | (28,905 | ) | | Morgan Stanley & Co. International PLC | | |||||||||||||||
RUB | 46,000 | 03/04/25 | 6.305%(A) | 3 Month MosPRIME(2)(Q) | 13,580 | (1 | ) | 13,581 | | Goldman Sachs International | | |||||||||||||||||
RUB | 46,000 | 06/17/25 | 6.150%(A) | 3 Month MosPRIME(2)(Q) | 9,079 | — | 9,079 | | Goldman Sachs International | | ||||||||||||||||||
RUB | 103,520 | 06/17/25 | 6.257%(A) | 3 Month MosPRIME(2)(Q) | 26,971 | — | 26,971 | | Goldman Sachs International | | ||||||||||||||||||
RUB | 83,000 | 06/17/25 | 7.733%(A) | 3 Month MosPRIME(2)(Q) | 93,943 | — | 93,943 | | Goldman Sachs International | | ||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
$ | 74,068 | $ | (28 | ) | $ | 74,096 | ||||||||||||||||||||||
|
|
|
|
|
|
(1) | The Series pays the fixed rate and receives the floating rate. |
(2) | The Series pays the floating rate and receives the fixed rate. |
Balances Reported in the Statement of Assets and Liabilities for OTC Swap Agreements:
Premiums Paid | Premiums Received | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||
OTC Swap Agreements | $ | — | $ | (28 | ) | $ | 143,574 | $ | (69,478 | ) | ||||||
|
|
|
|
|
|
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 37 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Summary of Collateral for Centrally Cleared/Exchange-traded Derivatives:
Cash and securities segregated as collateral, including pending settlement for closed positions, to cover requirements for centrally cleared/exchange-traded derivatives are listed by broker as follows:
Broker | Cash and/or Foreign Currency | Securities Market Value | ||||||
Citigroup Global Markets, Inc. | $ | 1,104,000 | $ | — | ||||
J.P. Morgan Securities LLC | 170,000 | — | ||||||
Total | $ | 1,274,000 | $ | — | ||||
|
|
|
|
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Sovereign Bonds | ||||||||||||
Angola | $ | — | $ | 189,897 | $ | — | ||||||
Argentina | — | 143,439 | — | |||||||||
Bahrain | — | 200,992 | — | |||||||||
Brazil | — | 532,576 | — | |||||||||
Chile | — | 1,729,841 | — | |||||||||
China | — | 1,483,897 | — | |||||||||
Colombia | — | 1,992,906 | — | |||||||||
Czech Republic | — | 940,576 | — | |||||||||
Dominican Republic | — | 121,276 | — | |||||||||
Ecuador | — | 83,016 | — | |||||||||
Egypt | — | 265,115 | — | |||||||||
El Salvador | — | 107,662 | — | |||||||||
Gabon | — | 286,853 | — | |||||||||
Ghana | — | 234,755 | — | |||||||||
Hungary | — | 1,569,323 | — | |||||||||
Indonesia | — | 5,367,390 | — | |||||||||
Iraq | — | 211,961 | — | |||||||||
Ivory Coast | — | 267,286 | — | |||||||||
Malaysia | — | 2,875,956 | — | |||||||||
Mexico | — | 977,399 | — | |||||||||
Nigeria | — | 167,119 | — | |||||||||
Pakistan | — | 368,908 | — |
See Notes to Financial Statements.
38 |
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities (continued) | ||||||||||||
Assets (continued) | ||||||||||||
Sovereign Bonds (continued) | ||||||||||||
Peru | $ | — | $ | 2,499,369 | $ | — | ||||||
Philippines | — | 112,078 | — | |||||||||
Poland | — | 2,115,161 | — | |||||||||
Romania | — | 1,005,139 | — | |||||||||
Russia | — | 1,508,501 | — | |||||||||
South Africa | — | 5,114,341 | — | |||||||||
Sri Lanka | — | 279,048 | — | |||||||||
Thailand | — | 4,204,185 | — | |||||||||
Turkey | — | 1,737,915 | — | |||||||||
Ukraine | — | 645,159 | — | |||||||||
Uruguay | — | 107,356 | — | |||||||||
Corporate Bonds | ||||||||||||
Bahrain | — | 196,028 | — | |||||||||
Belarus | — | 185,427 | — | |||||||||
Brazil | — | 183,512 | — | |||||||||
Indonesia | — | 194,625 | — | |||||||||
Jamaica | — | 91,591 | — | |||||||||
Mexico | — | 1,051,374 | — | |||||||||
Oman | — | 168,448 | — | |||||||||
Russia | — | 1,845,124 | — | |||||||||
South Africa | — | 149,218 | — | |||||||||
Supranational Bank | — | 722,473 | — | |||||||||
Tunisia | — | 257,469 | — | |||||||||
Affiliated Mutual Fund | 219,899 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | 219,899 | $ | 44,491,684 | $ | — | ||||||
|
|
|
|
|
| |||||||
Other Financial Instruments* | ||||||||||||
Assets | ||||||||||||
OTC Forward Foreign Currency Exchange Contracts | $ | — | $ | 1,716,255 | $ | — | ||||||
OTC Cross Currency Exchange Contracts | — | 180 | — | |||||||||
Centrally Cleared Interest Rate Swap Agreements | — | 880,961 | — | |||||||||
OTC Interest Rate Swap Agreements | — | 143,573 | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | — | $ | 2,740,969 | $ | — | ||||||
|
|
|
|
|
| |||||||
Liabilities | ||||||||||||
Futures Contracts | $ | (6,571 | ) | $ | — | $ | — | |||||
OTC Forward Foreign Currency Exchange Contracts | — | (2,066,807 | ) | — | ||||||||
Centrally Cleared Interest Rate Swap Agreements | — | (312,196 | ) | — | ||||||||
OTC Interest Rate Swap Agreements | — | (69,505 | ) | — | ||||||||
|
|
|
|
|
| |||||||
Total | $ | (6,571 | ) | $ | (2,448,508 | ) | $ | — | ||||
|
|
|
|
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 39 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
* | Other financial instruments are derivative instruments not reflected in the Schedule of Investments, such as futures, forwards and centrally cleared swap contracts, which are recorded at the unrealized appreciation (depreciation) on the instrument, and OTC swap contracts which are recorded at fair value. |
Industry Classification:
The industry classification of investments and other assets in excess of liabilities shown as a percentage of net assets as of April 30, 2020 were as follows:
Sovereign Bonds | 82.6 | % | ||
Investment Companies | 3.9 | |||
Oil & Gas | 2.2 | |||
Multi-National | 1.5 | |||
Telecommunications | 1.4 | |||
Banks | 0.9 | |||
Electric | 0.7 | |||
Affiliated Mutual Fund | 0.5 | % | ||
|
| |||
93.7 | ||||
Other assets in excess of liabilities | 6.3 | |||
|
| |||
100.0 | % | |||
|
|
Effects of Derivative Instruments on the Financial Statements and Primary Underlying Risk Exposure:
The Series invested in derivative instruments during the reporting period. The primary types of risk associated with these derivative instruments are foreign exchange contracts risk and interest rate contracts risk. See the Notes to Financial Statements for additional detail regarding these derivative instruments and their risks. The effect of such derivative instruments on the Series’ financial position and financial performance as reflected in the Statement of Assets and Liabilities and Statement of Operations is presented in the summary below.
Fair values of derivative instruments as of April 30, 2020 as presented in the Statement of Assets and Liabilities:
Asset Derivatives | Liability Derivatives | |||||||||||
Derivatives not accounted | Statement of | Fair Value | Statement of | Fair Value | ||||||||
Foreign exchange contracts | Unrealized appreciation on OTC cross currency exchange contracts | $ | 180 | — | $ | — | ||||||
Foreign exchange contracts | Unrealized appreciation on OTC forward foreign currency exchange contracts | 1,716,255 | Unrealized depreciation on OTC forward foreign currency exchange contracts | 2,066,807 | ||||||||
Interest rate contracts | — | — | Due from/to broker—variation margin futures | 6,571 | * | |||||||
Interest rate contracts | Due from/to broker—variation margin swaps | 880,961 | * | Due from/to broker—variation margin swaps | 312,196 | * | ||||||
Interest rate contracts | — | — | Premiums received for OTC swap agreements | 28 |
See Notes to Financial Statements.
40 |
Asset Derivatives | Liability Derivatives | |||||||||||
Derivatives not accounted | Statement of | Fair Value | Statement of Liabilities Location | Fair Value | ||||||||
Interest rate contracts | Unrealized appreciation on OTC swap agreements | $ | 143,574 | Unrealized depreciation on OTC swap agreements | $ | 69,478 | ||||||
|
|
|
| |||||||||
$ | 2,740,970 | $ | 2,455,080 | |||||||||
|
|
|
|
* | Includes cumulative appreciation (depreciation) as reported in the schedule of open futures and centrally cleared swap contracts. Only unsettled variation margin receivable (payable) is reported within the Statement of Assets and Liabilities. |
The effects of derivative instruments on the Statement of Operations for the six months ended April 30, 2020 are as follows:
Amount of Realized Gain (Loss) on Derivatives Recognized in Income | ||||||||||||
Derivatives not accounted | Futures | Forward & Cross Currency Exchange Contracts | Swaps | |||||||||
Foreign exchange contracts | $ | — | $ | (1,560,011 | ) | $ | — | |||||
Interest rate contracts | (515 | ) | — | 513,196 | ||||||||
|
|
|
|
|
| |||||||
Total | $ | (515 | ) | $ | (1,560,011 | ) | $ | 513,196 | ||||
|
|
|
|
|
|
Change in Unrealized Appreciation (Depreciation) on Derivatives Recognized in Income | ||||||||||||
Derivatives not accounted | Futures | Forward & Cross Currency Exchange Contracts | Swaps | |||||||||
Foreign exchange contracts | $ | — | $ | (625,478 | ) | $ | — | |||||
Interest rate contracts | (6,571 | ) | — | 385,440 | ||||||||
|
|
|
|
|
| |||||||
Total | $ | (6,571 | ) | $ | (625,478 | ) | $ | 385,440 | ||||
|
|
|
|
|
|
For the six months ended April 30, 2020, the Series’ average volume of derivative activities is as follows:
Futures Contracts— Short Positions(1) | Forward Foreign Currency Exchange Contracts— Purchased(2) | |
$1,572,489 | $55,252,664 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 41 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward Foreign Currency Exchange Contracts— Sold(2) | Cross Currency Exchange Contracts(3) | Interest Rate Swap Agreements(1) | ||||||||
$ | 45,567,864 | $ | 259,216 | $ | 36,104,135 |
(1) | Notional Amount in USD. |
(2) | Value at Settlement Date. |
(3) | Value at Trade Date. |
Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series invested in OTC derivatives during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for OTC derivatives where the legal right to set-off exists is presented in the summary below.
Offsetting of OTC derivative assets and liabilities:
Counterparty | Gross Amounts of Recognized Assets(1) | Gross Amounts of Recognized Liabilities(1) | Net Amounts of Recognized Assets/(Liabilities) | Collateral Pledged/ (Received)(2) | Net Amount | |||||||||||||||
Bank of America, N.A. | $ | 17,861 | $ | (20,071 | ) | $ | (2,210 | ) | $ | — | $ | (2,210 | ) | |||||||
Barclays Bank PLC | 125,645 | (201,957 | ) | (76,312 | ) | 58,000 | (18,312 | ) | ||||||||||||
BNP Paribas S.A. | 8,140 | (131,318 | ) | (123,178 | ) | — | (123,178 | ) | ||||||||||||
Citibank, N.A. | 201,151 | (989,709 | ) | (788,558 | ) | 750,000 | (38,558 | ) | ||||||||||||
Credit Suisse International | 54,182 | (35,280 | ) | 18,902 | — | 18,902 | ||||||||||||||
Deutsche Bank AG | 4,214 | (17,370 | ) | (13,156 | ) | — | (13,156 | ) | ||||||||||||
Goldman Sachs International | 216,126 | (40,041 | ) | 176,085 | — | 176,085 | ||||||||||||||
HSBC Bank USA, N.A. | 119,589 | (119,037 | ) | 552 | — | 552 | ||||||||||||||
JPMorgan Chase Bank, N.A. | 880,288 | (162,680 | ) | 717,608 | (717,608 | ) | — | |||||||||||||
Morgan Stanley & Co. International PLC | 166,636 | (313,976 | ) | (147,340 | ) | — | (147,340 | ) | ||||||||||||
The Toronto-Dominion Bank | 1,334 | (14,708 | ) | (13,374 | ) | — | (13,374 | ) | ||||||||||||
UBS AG | 64,843 | (90,166 | ) | (25,323 | ) | — | (25,323 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 1,860,009 | $ | (2,136,313 | ) | $ | (276,304 | ) | $ | 90,392 | $ | (185,912 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Includes unrealized appreciation/(depreciation) on swaps and forwards, premiums paid/(received) on swap agreements and market value of purchased and written options, as represented on the Statement of Assets and Liabilities. |
See Notes to Financial Statements.
42 |
(2) | Collateral amount disclosed by the Series is limited to the market value of financial instruments/transactions and the Series’ OTC derivative exposure by counterparty. |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 43 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value: | ||||
Unaffiliated investments (cost $50,682,630) | $ | 44,491,684 | ||
Affiliated investments (cost $219,899) | 219,899 | |||
Cash | 79,590 | |||
Foreign currency, at value (cost $125,115) | 126,893 | |||
Cash segregated for counterparty—OTC | 808,000 | |||
Unrealized appreciation on OTC forward foreign currency exchange contracts | 1,716,255 | |||
Deposit with broker for centrally cleared/exchange-traded derivatives | 1,274,000 | |||
Dividends and interest receivable | 870,613 | |||
Receivable for Series shares sold | 377,355 | |||
Unrealized appreciation on OTC swap agreements | 143,574 | |||
Tax reclaim receivable | 74,568 | |||
Due from Manager | 5,968 | |||
Receivable for investments sold | 286 | |||
Unrealized appreciation on OTC cross currency exchange contracts | 180 | |||
Prepaid expenses | 320 | |||
|
| |||
Total Assets | 50,189,185 | |||
|
| |||
Liabilities | ||||
Unrealized depreciation on OTC forward foreign currency exchange contracts | 2,066,807 | |||
Payable for Series shares reacquired | 201,781 | |||
Accrued expenses and other liabilities | 74,980 | |||
Unrealized depreciation on OTC swap agreements | 69,478 | |||
Due to broker—variation margin swaps | 26,432 | |||
Due to broker—variation margin futures | 4,252 | |||
Distribution fee payable | 937 | |||
Affiliated transfer agent fee payable | 749 | |||
Dividends payable | 492 | |||
Premiums received for OTC swap agreements | 28 | |||
|
| |||
Total Liabilities | 2,445,936 | |||
|
| |||
Net Assets | $ | 47,743,249 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 90,592 | ||
Paid-in capital in excess of par | 64,660,389 | |||
Total distributable earnings (loss) | (17,007,732 | ) | ||
|
| |||
Net assets, April 30, 2020 | $ | 47,743,249 | ||
|
|
See Notes to Financial Statements.
44 |
Class A | ||||
Net asset value and redemption price per share, | $ | 5.22 | ||
Maximum sales charge (3.25% of offering price) | 0.18 | |||
|
| |||
Maximum offering price to public | $ | 5.40 | ||
|
| |||
Class C | ||||
Net asset value, offering price and redemption price per share, | $ | 5.26 | ||
|
| |||
Class Z | ||||
Net asset value, offering price and redemption price per share, | $ | 5.27 | ||
|
| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | $ | 5.27 | ||
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 45 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Interest income (net of $23,755 foreign withholding tax) | $ | 1,976,432 | ||
Affiliated dividend income | 19,286 | |||
Income from securities lending, net (including affiliated income of $17) | 24 | |||
|
| |||
Total income | 1,995,742 | |||
|
| |||
Expenses | ||||
Management fee | 236,284 | |||
Distribution fee(a) | 6,818 | |||
Custodian and accounting fees | 66,394 | |||
Transfer agent’s fees and expenses (including affiliated expense of $2,093)(a) | 46,295 | |||
Audit fee | 32,018 | |||
Registration fees(a) | 28,008 | |||
Shareholders’ reports | 15,159 | |||
Legal fees and expenses | 8,380 | |||
Directors’ fees | 6,311 | |||
Miscellaneous | 9,064 | |||
|
| |||
Total expenses | 454,731 | |||
Less: Fee waiver and/or expense reimbursement(a) | (186,167 | ) | ||
|
| |||
Net expenses | 268,564 | |||
|
| |||
Net investment income (loss) | 1,727,178 | |||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions | (196,284 | ) | ||
Futures transactions | (515 | ) | ||
Forward currency contract transactions | (1,560,011 | ) | ||
Swap agreement transactions | 513,196 | |||
Foreign currency transactions | (3,050,840 | ) | ||
|
| |||
(4,294,454 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | (7,343,876 | ) | ||
Futures | (6,571 | ) | ||
Forward and cross currency contracts | (625,478 | ) | ||
Swap agreements | 385,440 | |||
Foreign currencies | 5,607 | |||
|
| |||
(7,584,878 | ) | |||
|
| |||
Net gain (loss) on investment and foreign currency transactions | (11,879,332 | ) | ||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | (10,152,154 | ) | |
|
|
See Notes to Financial Statements.
46 |
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class Z | Class R6 | |||||||||||||
Distribution fee | 4,284 | 2,534 | — | — | ||||||||||||
Transfer agent’s fees and expenses | 2,540 | 666 | 43,047 | 42 | ||||||||||||
Registration fees | 6,701 | 6,701 | 7,905 | 6,701 | ||||||||||||
Fee waiver and/or expense reimbursement | (12,715 | ) | (7,884 | ) | (158,752 | ) | (6,816 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 47 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 1,727,178 | $ | 3,571,535 | ||||
Net realized gain (loss) on investment and foreign currency transactions | (4,294,454 | ) | (1,942,406 | ) | ||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | (7,584,878 | ) | 8,411,654 | |||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | (10,152,154 | ) | 10,040,783 | |||||
|
|
|
| |||||
Dividends and Distributions | ||||||||
Distributions from distributable earnings | ||||||||
Class A | (86,198 | ) | (173,207 | ) | ||||
Class C | (10,866 | ) | (26,238 | ) | ||||
Class Z | (1,759,732 | ) | (3,540,771 | ) | ||||
Class R6 | (982 | ) | (804 | ) | ||||
|
|
|
| |||||
(1,857,778 | ) | (3,741,020 | ) | |||||
|
|
|
| |||||
Tax return of capital distributions | ||||||||
Class A | — | (3,312 | ) | |||||
Class C | — | (502 | ) | |||||
Class Z | — | (67,701 | ) | |||||
Class R6 | — | (15 | ) | |||||
|
|
|
| |||||
— | (71,530 | ) | ||||||
|
|
|
| |||||
Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 11,243,394 | 18,954,796 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | 1,782,788 | 3,793,522 | ||||||
Cost of shares reacquired | (25,674,056 | ) | (15,260,204 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | (12,647,874 | ) | 7,488,114 | |||||
|
|
|
| |||||
Total increase (decrease) | (24,657,806 | ) | 13,716,347 | |||||
Net Assets: | ||||||||
Beginning of period | 72,401,055 | 58,684,708 | ||||||
|
|
|
| |||||
End of period | $ | 47,743,249 | $ | 72,401,055 | ||||
|
|
|
|
See Notes to Financial Statements.
48 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act. These financial statements relate only to the PGIM Emerging Markets Debt Local Currency Fund (the “Series”).
The investment objective of the Series is total return, through a combination of current income and capital appreciation.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services—Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund’s Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some
PGIM Emerging Markets Debt Local Currency Fund | 49 |
Notes to Financial Statements (unaudited) (continued)
of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Fixed income securities traded in the OTC market are generally classified as Level 2 in the fair value hierarchy. Such fixed income securities are typically valued using the market approach which generally involves obtaining data from an approved independent third-party vendor source. The Series utilizes the market approach as the primary method to value securities when market prices of identical or comparable instruments are available. The third-party vendors’ valuation techniques used to derive the evaluated bid price are based on evaluating observable inputs, including but not limited to, yield curves, yield spreads, credit ratings, deal terms, tranche level attributes, default rates, cash flows, prepayment speeds, broker/dealer quotations and reported trades. Certain Level 3 securities are also valued using the market approach when obtaining a single broker quote or when utilizing transaction prices for identical securities that have been used in excess of five business days. During the reporting period, there were no changes to report with respect to the valuation approach and/or valuation techniques discussed above.
OTC and centrally cleared derivative instruments are generally classified as Level 2 in the fair value hierarchy. Such derivative instruments are typically valued using the market approach and/or income approach which generally involves obtaining data from an approved independent third-party vendor source. The Series utilizes the market approach when quoted prices in broker-dealer markets are available but also includes consideration of alternative valuation approaches, including the income approach. In the absence of reliable market quotations, the income approach is typically utilized for purposes of valuing derivatives such as interest rate swaps based on a discounted cash flow analysis whereby the value of the instrument is equal to the present value of its future cash inflows or outflows. Such analysis includes projecting future cash flows and determining the discount rate (including the present value factors that affect the discount rate) used to discount the future cash flows. In addition, the third-party vendors’ valuation techniques used to derive the evaluated derivative price is based on evaluating observable inputs, including but not limited to, underlying asset prices, indices, spreads, interest rates and exchange rates. Certain
50 |
derivatives may be classified as Level 3 when valued using the market approach by obtaining a single broker quote or when utilizing unobservable inputs in the income approach. During the reporting period, there were no changes to report with respect to the valuation approach and/or valuation techniques discussed above.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
PGIM Emerging Markets Debt Local Currency Fund | 51 |
Notes to Financial Statements (unaudited) (continued)
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally 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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions. Notwithstanding the above, the Series does isolate the effect of fluctuations in foreign currency exchange rates when determining the gain (loss) upon the sale or maturity of foreign currency denominated debt obligations; such amounts are included in net realized gains (losses) on foreign currency transactions.
Additionally, net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Forward and Cross 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 Series enters into forward currency contracts, as defined in the prospectus, 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 and to gain exposure to certain currencies. The contracts are valued daily at current forward exchange rates and any unrealized gain (loss) is included in net unrealized appreciation (depreciation) on forward and cross currency contracts. Gain (loss) is realized on the settlement date of the contract equal to the difference between the settlement value of the original and negotiated forward contracts. This gain (loss), if any, is included in net realized gain (loss) on forward
52 |
and cross currency contract transactions. Risks may arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts. Forward currency contracts involve risks from currency exchange rate and credit risk in excess of the amounts reflected on the Statement of Assets and Liabilities. The Series’ maximum risk of loss from counterparty credit risk is the net value of the cash flows to be received from the counterparty at the end of the contract’s life. A cross currency contract is a forward contract where a specified amount of one foreign currency will be exchanged for a specified amount of another foreign currency.
Financial Futures Contracts: A financial futures contract is an agreement to purchase (long) or sell (short) an agreed amount of securities at a set price for delivery on a future date. Upon entering into a financial futures contract, the Series is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount. This amount is known as the “initial margin.” Subsequent payments, known as “variation margin,” are made or received by the Series each day, depending on the daily fluctuations in the value of the underlying security. Such variation margin is recorded for financial statement purposes on a daily basis as unrealized gain (loss). When the contract expires or is closed, the gain (loss) is realized and is presented in the Statement of Operations as net realized gain (loss) on futures transactions.
The Series invested in financial futures contracts in order to hedge its existing portfolio securities, or securities the Series intends to purchase, against fluctuations in value caused by changes in prevailing interest rates. Should interest rates move unexpectedly, the Series may not achieve the anticipated benefits of the financial futures contracts and may realize a loss. The use of futures transactions involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates and the underlying hedged assets. Since futures contracts are exchange-traded, there is minimal counterparty credit risk to the Series since the exchanges’ clearinghouse acts as counterparty to all exchange-traded futures and guarantees the futures contracts against default.
Swap Agreements: The Series entered into certain types of swap agreements detailed in the disclosures below. A swap agreement is an agreement to exchange the return generated by one instrument for the return generated by another instrument. Swap agreements are negotiated in the OTC market and may be executed either directly with a counterparty (“OTC-traded”) or through a central clearing facility, such as a registered exchange. Swap agreements are valued daily at current market value and any change in value is included in the net unrealized appreciation (depreciation) on swap agreements. Centrally cleared swaps pay or receive an amount known as “variation margin”, based on daily changes in the valuation of the swap contract. For OTC-traded, upfront premiums paid and received are shown as swap premiums paid and swap premiums received in the Statement of Assets and Liabilities. Risk of loss may exceed amounts recognized on the Statement of Assets and Liabilities. Swap agreements outstanding at period end, if any, are listed on the Schedule of Investments.
PGIM Emerging Markets Debt Local Currency Fund | 53 |
Notes to Financial Statements (unaudited) (continued)
Interest Rate Swaps: Interest rate swaps represent an agreement between counterparties to exchange cash flows based on the difference between two interest rates, applied to a notional principal amount for a specified period. The Series is subject to interest rate risk exposure in the normal course of pursuing its investment objective. The Series used interest rate swaps to maintain its ability to generate steady cash flow by receiving a stream of fixed rate payments or to increase exposure to prevailing market rates by receiving floating rate payments. The Series’ maximum risk of loss from counterparty credit risk is the discounted net present value of the cash flows to be received from the counterparty over the contract’s remaining life.
Master Netting Arrangements: The Fund, on behalf of the Series, is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
The Fund, on behalf of the Series, is a party to International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreements with certain counterparties that govern OTC derivative and foreign exchange contracts entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties’ general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agreements, collateral posted to the Series is held in a segregated account by the Series’ custodian and with respect to those amounts which can be sold or re-pledged, is presented in the Schedule of Investments. Collateral pledged by the Series is segregated by the Series’ custodian and identified in the Schedule of Investments. Collateral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other securities as agreed to by the Series and the applicable counterparty. Collateral requirements are determined based on the Series’ net position with each counterparty. Termination events applicable to the Series may occur upon a decline in the Series’ net assets below a specified threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term and
54 |
short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the Series’ counterparties to elect early termination could impact the Series’ future derivative activity.
In addition to each instrument’s primary underlying risk exposure (e.g. interest rate, credit, equity or foreign exchange, etc.), swap agreements involve, to varying degrees, elements of credit, market and documentation risk. Such risks involve the possibility that no liquid market for these agreements will exist, the counterparty to the agreement may default on its obligation to perform or disagree on the contractual terms of the agreement, and changes in net interest rates will be unfavorable. In connection with these agreements, securities in the portfolio may be identified or received as collateral from the counterparty in accordance with the terms of the respective swap agreements to provide or receive assets of value and to serve as recourse in the event of default or bankruptcy/insolvency of either party. Such OTC derivative agreements include conditions which, when materialized, give the counterparty the right to cause an early termination of the transactions under those agreements. Any election by the counterparty for early termination of the contract(s) may impact the amounts reported on financial statements.
As of April 30, 2020, the Series has not met conditions under such agreements which give the counterparty the right to call for an early termination.
Forward currency contracts, forward rate agreements, written options, short sales, swaps and financial futures contracts involve elements of both market and credit risk in excess of the amounts reflected on the Statement of Assets and Liabilities. Such risks may be mitigated by engaging in master netting arrangements.
Securities Lending: The Series lends its portfolio securities to banks and broker-dealers. The loans are secured by collateral at least equal to the market value of the securities loaned. Collateral pledged by each borrower is invested in an affiliated money market fund and is marked to market daily, based on the previous day’s market value, such that the value of the collateral exceeds the value of the loaned securities. In the event of significant appreciation in value of securities on loan on the last business day of the reporting period, the financial statements may reflect a collateral value that is less than the market value of the loaned securities. Such shortfall is remedied as described above. Loans are subject to termination at the option of the borrower or the Series. Upon termination of the loan, the borrower will return to the Series securities identical to the loaned securities. Should the borrower of the securities fail financially, the Series has the right to repurchase the securities in the open market using the collateral.
The Series recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The borrower receives all interest and dividends from the securities loaned and
PGIM Emerging Markets Debt Local Currency Fund | 55 |
Notes to Financial Statements (unaudited) (continued)
such payments are passed back to the lender in amounts equivalent thereto. The Series also continues to recognize any unrealized gain (loss) in the market price of the securities loaned and on the change in the value of the collateral invested that may occur during the term of the loan. In addition, realized gain (loss) is recognized on changes in the value of the collateral invested upon liquidation of the collateral. Net earnings from securities lending are disclosed in the Statement of Operations.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Interest income, including amortization of premium and accretion of discount on debt securities, as required, is recorded on the accrual basis. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to declare dividends of its net investment income daily and pay such dividends monthly. Distributions of net realized capital and currency gains, if any, are declared and paid at least annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
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2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with PGIM, Inc., which provides subadvisory services to the Series through its PGIM Fixed Income unit. The subadvisory agreement provides that PGIM, Inc. will furnish investment advisory services in connection with the management of the Series. In connection therewith, PGIM, Inc. is obligated to keep certain books and records of the Series. The Manager pays for the services of PGIM, Inc., the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
Effective December 13, 2019, the management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 0.65% of the Series’ average daily net assets up to and including $1 billion; 0.63% from $1 billion to $3 billion of average daily net assets; 0.61% from $3 billion to $5 billion of average daily net assets; 0.60% from $5 billion to $10 billion of average daily net assets; and 0.59% of the average daily net assets exceeding $10 billion. Prior to December 13, 2019, the management fee paid to the Manager was accrued daily and payable monthly at an annual rate of 0.80% of the Series’ average daily net assets up to and including $1 billion; 0.78% on the next $2 billion of average daily net assets; 0.76% on the next $2 billion of average daily net assets; 0.75% on the next $5 billion of average daily net assets; and 0.74% on average daily net assets exceeding $10 billion. The effective management fee rate before any waivers and/or expense reimbursements was 0.69% for the reporting period ended April 30, 2020.
Effective December 1, 2019, the Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.13% of average daily net assets for Class A shares, 1.88% of average daily net assets for Class C shares, 0.72% of average daily net assets for Class Z shares and 0.65% of average daily net assets for Class R6 shares. Prior to December 1, 2019, the Manager had contractually agreed, to limit total annual operating expenses after fee waivers
PGIM Emerging Markets Debt Local Currency Fund | 57 |
Notes to Financial Statements (unaudited) (continued)
and/or expense reimbursements to 1.13% of average daily net assets for Class A shares, 1.88% of average daily net assets for Class C shares, 0.88% of average daily net assets for Class Z shares and 0.88% of average daily net assets for Class R6 shares. This contractual waiver excludes interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class. In addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver and/or reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class Z and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A and Class C shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z or Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.25% and 1% of the average daily net assets of the Class A and Class C shares, respectively.
For the reporting period ended April 30, 2020, PIMS received $285 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS did not receive any contingent deferred sales charges imposed upon redemptions by certain Class A and Class C shareholders, respectively. From these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
PGIM Investments, PGIM, Inc. and PIMS are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
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3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PGIM Investments and an indirect, wholly-owned subsidiary of Prudential, serves as the Series’ transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), and its securities lending cash collateral in the PGIM Institutional Money Market Fund (the “Money Market Fund”), each a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund and Money Market Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income” and “Income from securities lending, net”, respectively.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Series’ Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $17,417,408 and $29,730,457, respectively.
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
Value, | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 2,483,525 | $ | 18,180,991 | $ | 20,444,617 | $ | — | $ | — | $ | 219,899 | 219,899 | $ | 19,286 |
PGIM Emerging Markets Debt Local Currency Fund | 59 |
Notes to Financial Statements (unaudited) (continued)
Value, | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Institutional Money Market Fund* | ||||||||||||||||||||||||||||||
$ | — | $ | 146,073 | $ | 146,073 | $ | — | $ | — | $ | — | — | $ | 17 | ** | |||||||||||||||
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$ | 2,483,525 | $ | 18,327,064 | $ | 20,590,690 | $ | — | $ | — | $ | 219,899 | $ | 19,303 | |||||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
** | Represents the affiliated amount of securities lending income shown on the Statement of Operations. |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized depreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 53,072,091 | ||
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Gross Unrealized Appreciation | 1,126,477 | |||
Gross Unrealized Depreciation | (9,201,095 | ) | ||
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Net Unrealized Depreciation | $ | (8,074,618 | ) | |
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The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $3,831,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class C, Class Z and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 3.25%. Investors who purchase $1 million or more prior to July 15, 2019 ($500,000 or more on or after July 15, 2019) of Class A shares and sell those shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1.00% on sales although these purchases are not subject to a front-end
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sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, $0.01 par value per share, 550 million of which are designated as shares of the Series. The shares are further classified and designated as follows:
Class A | 10,000,000 | |||
Class C | 50,000,000 | |||
Class Z | 250,000,000 | |||
Class T | 190,000,000 | |||
Class R6 | 50,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class Z | 3,566,262 | 42 | % | |||||
Class R6 | 175 | 2 | % |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
1 | 40% | 2 | 51% |
PGIM Emerging Markets Debt Local Currency Fund | 61 |
Notes to Financial Statements (unaudited) (continued)
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 7,626 | $ | 45,895 | |||||
Shares issued in reinvestment of dividends and distributions | 14,671 | 84,054 | ||||||
Shares reacquired | �� | (67,060 | ) | (361,370 | ) | |||
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Net increase (decrease) in shares outstanding before conversion | (44,763 | ) | (231,421 | ) | ||||
Shares issued upon conversion from other share class(es) | 2,982 | 15,116 | ||||||
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Net increase (decrease) in shares outstanding | (41,781 | ) | $ | (216,305 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 139,070 | $ | 811,691 | |||||
Shares issued in reinvestment of dividends and distributions | 29,166 | 171,313 | ||||||
Shares reacquired | (136,489 | ) | (783,730 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 31,747 | 199,274 | ||||||
Shares issued upon conversion from other share class(es) | 6,376 | 37,347 | ||||||
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Net increase (decrease) in shares outstanding | 38,123 | $ | 236,621 | |||||
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Class C | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 1,921 | $ | 11,600 | |||||
Shares issued in reinvestment of dividends and distributions | 1,866 | 10,768 | ||||||
Shares reacquired | (11,757 | ) | (70,025 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (7,970 | ) | (47,657 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (2,958 | ) | (15,116 | ) | ||||
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Net increase (decrease) in shares outstanding | (10,928 | ) | $ | (62,773 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 24,117 | $ | 142,221 | |||||
Shares issued in reinvestment of dividends and distributions | 4,486 | 26,541 | ||||||
Shares reacquired | (24,338 | ) | (144,141 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 4,265 | 24,621 | ||||||
Shares reacquired upon conversion into other share class(es) | (6,333 | ) | (37,347 | ) | ||||
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Net increase (decrease) in shares outstanding | (2,068 | ) | $ | (12,726 | ) | |||
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Class Z | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 1,828,737 | $ | 11,165,763 | |||||
Shares issued in reinvestment of dividends and distributions | 292,449 | 1,686,984 | ||||||
Shares reacquired | (4,836,482 | ) | (25,242,603 | ) | ||||
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Net increase (decrease) in shares outstanding | (2,715,296 | ) | $ | (12,389,856 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 3,011,000 | $ | 17,974,545 | |||||
Shares issued in reinvestment of dividends and distributions | 606,181 | 3,594,849 | ||||||
Shares reacquired | (2,375,568 | ) | (14,332,305 | ) | ||||
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Net increase (decrease) in shares outstanding | 1,241,613 | $ | 7,237,089 | |||||
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Class R6 | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 3,306 | $ | 20,136 | |||||
Shares issued in reinvestment of dividends and distributions | 173 | 982 | ||||||
Shares reacquired | (9 | ) | (58 | ) | ||||
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Net increase (decrease) in shares outstanding | 3,470 | $ | 21,060 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 4,450 | $ | 26,339 | |||||
Shares issued in reinvestment of dividends and distributions | 137 | 819 | ||||||
Shares reacquired | (5 | ) | (28 | ) | ||||
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Net increase (decrease) in shares outstanding | 4,582 | $ | 27,130 | |||||
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7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $ 1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent | |
* Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series utilized the SCA during the reporting period ended April 30, 2020. The average daily balance for the 22 days that the Series had loans outstanding during the period was approximately $1,277,045, borrowed at a weighted average interest rate of 2.15%. The maximum loan outstanding amount during the period was $8,796,000. At April 30, 2020, the Series did not have an outstanding loan amount.
PGIM Emerging Markets Debt Local Currency Fund | 63 |
Notes to Financial Statements (unaudited) (continued)
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Bond Obligations Risk: The Series’ holdings, share price, yield and total return may fluctuate in response to bond market movements. The value of bonds may decline for issuer-related reasons, including management performance, financial leverage and reduced demand for the issuer’s goods and services. Certain types of fixed-income obligations also may be subject to “call and redemption risk,” which is the risk that the issuer may call a bond held by the Series for redemption before it matures and the Series may not be able to reinvest at the same level and therefore would earn less income.
Derivatives Risk: Derivatives involve special risks and costs and may result in losses to the Series. The successful use of derivatives requires sophisticated management, and, to the extent that derivatives are used, the Series will depend on the subadviser’s ability to analyze and manage derivative transactions. The prices of derivatives may move in unexpected ways, especially in abnormal market conditions. Some derivatives are “leveraged” and therefore may magnify or otherwise increase investment losses to the Series. Other risks arise from the potential inability to terminate or sell derivatives positions. A liquid secondary market may not always exist for the Series’ derivatives positions. In fact, many OTC derivative instruments will not have liquidity beyond the counterparty to the instrument. OTC derivative instruments also involve the risk that the other party will not meet its obligations to the Series.
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Interest Rate Risk: The value of an investment may go down when interest rates rise. A rise in rates tends to have a greater impact on the prices of longer term or duration securities. When interest rates fall, the issuers of debt obligations may prepay principal more quickly than expected, and the Series may be required to reinvest the proceeds at a lower interest
64 |
rate. This is referred to as “prepayment risk.” When interest rates rise, debt obligations may be repaid more slowly than expected, and the value of the Series’ holdings may fall sharply. This is referred to as “extension risk”. The Series may face a heightened level of interest rate risk as a result of the U.S. Federal Reserve Board’s policies. The Series’ investments may lose value if short-term or long-term interest rates rise sharply or in a manner not anticipated by the subadviser.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Liquidity Risk: The Series may invest in instruments that trade in lower volumes and are less liquid than other investments. Liquidity risk exists when particular investments made by the Series are difficult to purchase or sell. Liquidity risk includes the risk that the Series may make investments that may become less liquid in response to market developments or adverse investor perceptions. Investments that are illiquid or that trade in lower volumes may be more difficult to value. If the Series is forced to sell these investments to pay redemption proceeds or for other reasons, the Series may lose money. In addition, when there is no willing buyer and investments may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment, the Series may incur higher transaction costs when executing trade orders of a given size. The reduction in dealer market-making capacity in the fixed-income markets that has occurred in recent years also has the potential to reduce liquidity. An inability to sell a portfolio position can adversely affect the Series’ value or prevent the Series from being able to take advantage of other investment opportunities.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern
PGIM Emerging Markets Debt Local Currency Fund | 65 |
Notes to Financial Statements (unaudited) (continued)
Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
Non-diversification Risk: A non-diversified Series may invest a greater percentage of its assets in the securities of a single company or industry than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
66 |
Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.07 | $5.52 | $6.40 | $6.44 | $6.24 | $7.92 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.13 | 0.30 | 0.33 | 0.35 | 0.33 | 0.37 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.84 | ) | 0.57 | (0.86 | ) | (0.02 | ) | 0.23 | (1.64 | ) | ||||||||||||||||||
Total from investment operations | (0.71 | ) | 0.87 | (0.53 | ) | 0.33 | 0.56 | (1.27 | ) | |||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income* | (0.14 | ) | (0.31 | ) | - | (0.15 | ) | - | (b) | (0.06 | ) | |||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | (0.35 | ) | (0.22 | ) | (0.36 | ) | (0.35 | ) | |||||||||||||||||
Total dividends and distributions | (0.14 | ) | (0.32 | ) | (0.35 | ) | (0.37 | ) | (0.36 | ) | (0.41 | ) | ||||||||||||||||
Net asset value, end of period | $5.22 | $6.07 | $5.52 | $6.40 | $6.44 | $6.24 | ||||||||||||||||||||||
Total Return(c): | (11.81)% | 16.14% | (8.68)% | 5.36% | 9.29% | (16.41)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $2,960 | $3,692 | $3,146 | $3,085 | $3,990 | $3,208 | ||||||||||||||||||||||
Average net assets (000) | $3,445 | $3,223 | $4,105 | $3,639 | $3,343 | $4,341 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.14% | (f) | 1.13% | 1.13% | 1.13% | 1.28% | 1.30% | (g) | ||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.88% | (f) | 2.03% | 2.16% | 2.15% | 2.33% | 2.39% | (g) | ||||||||||||||||||||
Net investment income (loss) | 4.65% | (f) | 5.13% | 5.34% | 5.42% | 5.20% | 5.32% | (g) | ||||||||||||||||||||
Portfolio turnover rate(h) | 27% | 69% | 113% | 186% | 196% | 101% |
* | Dividends from net investment income may include other items that are ordinary income for tax purposes. |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | Effective March 9, 2015, the contractual distribution and service (12b-1) fees were reduced from 0.30% to 0.25% of the average daily net assets and the 0.05% contractual 12b-1 fee waiver was terminated. |
(h) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 67 |
Financial Highlights (unaudited) (continued)
Class C Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.11 | $5.56 | $6.46 | $6.49 | $6.28 | $7.97 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.11 | 0.26 | 0.29 | 0.30 | 0.28 | 0.32 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.84 | ) | 0.57 | (0.88 | ) | (0.01 | ) | 0.25 | (1.65 | ) | ||||||||||||||||||
Total from investment operations | (0.73 | ) | 0.83 | (0.59 | ) | 0.29 | 0.53 | (1.33 | ) | |||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income* | (0.12 | ) | (0.27 | ) | - | (0.13 | ) | - | (b) | (0.01 | ) | |||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | (0.31 | ) | (0.19 | ) | (0.32 | ) | (0.35 | ) | |||||||||||||||||
Total dividends and distributions | (0.12 | ) | (0.28 | ) | (0.31 | ) | (0.32 | ) | (0.32 | ) | (0.36 | ) | ||||||||||||||||
Net asset value, end of period | $5.26 | $6.11 | $5.56 | $6.46 | $6.49 | $6.28 | ||||||||||||||||||||||
Total Return(c): | (12.05)% | 15.18% | (9.61)% | 4.66% | 8.61% | (17.00)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $441 | $579 | $538 | $718 | $787 | $701 | ||||||||||||||||||||||
Average net assets (000) | $510 | $566 | $672 | $649 | $721 | $789 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.89% | (f) | 1.88% | 1.88% | 1.88% | 2.03% | 2.05% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 5.00% | (f) | 4.82% | 4.89% | 2.88% | 3.07% | 3.11% | |||||||||||||||||||||
Net investment income (loss) | 3.90% | (f) | 4.37% | 4.56% | 4.63% | 4.40% | 4.52% | |||||||||||||||||||||
Portfolio turnover rate(g) | 27% | 69% | 113% | 186% | 196% | 101% |
* | Dividends from net investment income may include other items that are ordinary income for tax purposes. |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
68 |
Class Z Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.13 | $5.57 | $6.48 | $6.50 | $6.31 | $7.98 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.15 | 0.32 | 0.34 | 0.36 | 0.34 | 0.38 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.85 | ) | 0.58 | (0.88 | ) | 0.01 | 0.23 | (1.62 | ) | |||||||||||||||||||
Total from investment operations | (0.70 | ) | 0.90 | (0.54 | ) | 0.37 | 0.57 | (1.24 | ) | |||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income* | (0.16 | ) | (0.33 | ) | - | (0.16 | ) | - | (b) | (0.08 | ) | |||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | (0.37 | ) | (0.23 | ) | (0.38 | ) | (0.35 | ) | |||||||||||||||||
Total dividends and distributions | (0.16 | ) | (0.34 | ) | (0.37 | ) | (0.39 | ) | (0.38 | ) | (0.43 | ) | ||||||||||||||||
Net asset value, end of period | $5.27 | $6.13 | $5.57 | $6.48 | $6.50 | $6.31 | ||||||||||||||||||||||
Total Return(c): | (11.67)% | 16.50% | (8.83)% | 5.85% | 9.31% | (15.90)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $44,300 | $68,101 | $55,000 | $27,020 | $27,462 | $24,821 | ||||||||||||||||||||||
Average net assets (000) | $65,326 | $63,219 | $49,644 | $26,437 | $25,994 | $25,969 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.75% | (f) | 0.88% | 0.88% | 0.88% | 1.03% | 1.05% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.24% | (f) | 1.31% | 1.41% | 1.88% | 2.06% | 2.11% | |||||||||||||||||||||
Net investment income (loss) | 5.04% | (f) | 5.35% | 5.50% | 5.58% | 5.36% | 5.50% | |||||||||||||||||||||
Portfolio turnover rate(g) | 27% | 69% | 113% | 186% | 196% | 101% |
* | Dividends from net investment income may include other items that are ordinary income for tax purposes. |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Local Currency Fund | 69 |
Financial Highlights (unaudited) (continued)
Class R6 Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $6.12 | $5.56 | $6.47 | $6.50 | $6.30 | $7.98 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.14 | 0.31 | 0.36 | 0.37 | 0.35 | 0.39 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.83 | ) | 0.58 | (0.89 | ) | - | (b) | 0.23 | (1.63 | ) | ||||||||||||||||||
Total from investment operations | (0.69 | ) | 0.89 | (0.53 | ) | 0.37 | 0.58 | (1.24 | ) | |||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income* | (0.16 | ) | (0.32 | ) | - | (0.16 | ) | - | (b) | (0.09 | ) | |||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | (0.38 | ) | (0.24 | ) | (0.38 | ) | (0.35 | ) | |||||||||||||||||
Total dividends and distributions | (0.16 | ) | (0.33 | ) | (0.38 | ) | (0.40 | ) | (0.38 | ) | (0.44 | ) | ||||||||||||||||
Net asset value, end of period | $5.27 | $6.12 | $5.56 | $6.47 | $6.50 | $6.30 | ||||||||||||||||||||||
Total Return(c): | (11.50)% | 16.41% | (8.63)% | 5.82% | 9.55% | (15.94)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $43 | $29 | $1 | $1 | $1 | $1 | ||||||||||||||||||||||
Average net assets (000) | $37 | $15 | $1 | $1 | $1 | $1 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.69% | (f) | 0.88% | 0.88% | 0.88% | 1.03% | 1.05% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 38.17% | (f) | 92.22% | 1,595.87% | 1.83% | 2.06% | 2.01% | |||||||||||||||||||||
Net investment income (loss) | 5.01% | (f) | 5.20% | 5.73% | 5.73% | 5.47% | 5.60% | |||||||||||||||||||||
Portfolio turnover rate(g) | 27% | 69% | 113% | 186% | 196% | 101% |
* | Dividends from net investment income may include other items that are ordinary income for tax purposes. |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
70 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Emerging Markets Debt Local Currency Fund | 71 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | PGIM Fixed Income | 655 Broad Street Newark, NJ 07102 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street New York, NY 10286 | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Emerging Markets Debt Local Currency Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM EMERGING MARKETS DEBT LOCAL CURRENCY FUND
SHARE CLASS | A | C | Z | R6 | ||||
NASDAQ | EMDAX | EMDCX | EMDZX | EMDQX | ||||
CUSIP | 743969750 | 743969743 | 743969727 | 743969735 |
MF212E2
PGIM JENNISON EMERGING MARKETS EQUITY OPPORTUNITIES FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
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9 |
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC, member SIPC. Jennison Associates LLC is a registered investment adviser. Both are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, PGIM, and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
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Dear Shareholder:
We hope you find the semiannual report for PGIM Jennison Emerging Markets Equity Opportunities Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Jennison Emerging Markets Equity Opportunities Fund
June 15, 2020
PGIM Jennison Emerging Markets Equity Opportunities Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
Average Annual Total Returns as of 4/30/20 | ||||||||
(without sales charges) | (with sales charges) | |||||||
Six Months* (%) | One Year (%) | Five Years (%) | Since Inception (%) | |||||
Class A | –1.56 | –1.64 | 2.41 | 2.22 (9/16/14) | ||||
Class C | –1.96 | 2.33 | 2.80 | 2.48 (9/16/14) | ||||
Class Z | –1.38 | 4.39 | 3.83 | 3.51 (9/16/14) | ||||
Class R6 | –1.38 | 4.39 | 3.83 | 3.52 (9/16/14) | ||||
MSCI Emerging Markets Index | ||||||||
–10.50 | –12.00 | –0.10 | 0.82 |
*Not annualized
Source: PGIM Investments LLC and Lipper Inc.
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to the Fund’s inception date.
The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class Z | Class R6 | |||||
Maximum initial sales charge | 5.50% of the public offering price | None | None | None | ||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 1.00% on sales made within 12 months of purchase | None | None | ||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% (0.25% currently) | 1.00% | None | None |
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Benchmark Definitions
MSCI Emerging Markets Index—The MSCI Emerging Markets Index is an unmanaged free float-adjusted market capitalization-weighted index that is designed to measure equity market performance of emerging markets. The MSCI Emerging Markets Index consists of the following 24 emerging market country indexes: Brazil, Chile, China, Colombia, the Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Pakistan, Peru, the Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey, and the United Arab Emirates.
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
Presentation of Fund Holdings as of 4/30/20
Ten Largest Holdings | Line of Business | Country | % of Net Assets | |||
Alibaba Group Holding Ltd., ADR | Internet & Direct Marketing Retail | China | 7.0% | |||
Tencent Holdings Ltd. | Interactive Media & Services | China | 6.4% | |||
Wuxi Biologics Cayman, Inc., 144A | Life Sciences Tools & Services | China | 5.6% | |||
Taiwan Semiconductor Manufacturing Co. Ltd., ADR | Semiconductors & Semiconductor Equipment | Taiwan | 5.0% | |||
MercadoLibre, Inc. | Internet & Direct Marketing Retail | Argentina | 4.9% | |||
WuXi AppTec Co. Ltd. (Class H Stock), 144A | Life Sciences Tools & Services | China | 4.7% | |||
Jiangsu Hengrui Medicine Co. Ltd. (Class A Stock) | Pharmaceuticals | China | 4.7% | |||
Samsung Electronics Co. Ltd. | Technology Hardware, Storage & Peripherals | South Korea | 4.6% | |||
Meituan Dianping (Class B Stock) | Internet & Direct Marketing Retail | China | 3.7% | |||
Zai Lab Ltd., ADR | Biotechnology | China | 3.6% |
Holdings reflect only long-term investments and are subject to change.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 5 |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
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and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Jennison Emerging Markets Equity Opportunities Fund | Beginning Account Value November 1, 2019 | Ending Account April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 984.40 | 1.45 | % | $ | 7.15 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,017.65 | 1.45 | % | $ | 7.27 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 980.40 | 2.20 | % | $ | 10.83 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,013.92 | 2.20 | % | $ | 11.02 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 986.20 | 1.20 | % | $ | 5.93 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,018.90 | 1.20 | % | $ | 6.02 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 986.20 | 1.20 | % | $ | 5.93 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,018.90 | 1.20 | % | $ | 6.02 |
*Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 7 |
Schedule of Investments (unaudited)
as of April 30, 2020
Description | Shares | Value | ||||||
LONG-TERM INVESTMENTS 97.6% | ||||||||
COMMON STOCKS | ||||||||
Argentina 7.3% | ||||||||
Globant SA*(a) | 4,622 | $ | 534,627 | |||||
MercadoLibre, Inc.* | 1,898 | 1,107,502 | ||||||
|
| |||||||
1,642,129 | ||||||||
Brazil 9.7% | ||||||||
Arco Platform Ltd. (Class A Stock)* | 10,455 | 525,050 | ||||||
Lojas Renner SA | 43,156 | 305,463 | ||||||
Magazine Luiza SA | 82,874 | 765,661 | ||||||
Raia Drogasil SA | 13,433 | 260,291 | ||||||
StoneCo Ltd. (Class A Stock)* | 12,543 | 330,884 | ||||||
|
| |||||||
2,187,349 | ||||||||
China 54.3% | ||||||||
Aier Eye Hospital Group Co. Ltd. (Class A Stock) | 63,354 | 394,960 | ||||||
Alibaba Group Holding Ltd., ADR* | 7,729 | 1,566,437 | ||||||
BeiGene Ltd., ADR* | 1,689 | 258,130 | ||||||
Hangzhou Tigermed Consulting Co. Ltd. (Class A Stock) | 25,540 | 277,292 | ||||||
Innovent Biologics, Inc., 144A* | 128,190 | 636,162 | ||||||
JD.com, Inc., ADR* | 17,354 | 747,957 | ||||||
Jiangsu Hengrui Medicine Co. Ltd. (Class A Stock)* | 80,535 | 1,052,886 | ||||||
Jinxin Fertility Group Ltd., 144A*(a) | 189,790 | 241,683 | ||||||
Kweichow Moutai Co. Ltd. (Class A Stock) | 3,607 | 640,748 | ||||||
Li Ning Co. Ltd. | 199,475 | 628,687 | ||||||
Meituan Dianping (Class B Stock)* | 62,157 | 829,021 | ||||||
Silergy Corp. | 9,000 | 359,096 | ||||||
Tencent Holdings Ltd. | 27,100 | 1,434,271 | ||||||
WuXi AppTec Co. Ltd. (Class H Stock), 144A | 75,135 | 1,065,493 | ||||||
Wuxi Biologics Cayman, Inc., 144A* | 80,626 | 1,250,223 | ||||||
Zai Lab Ltd., ADR* | 12,981 | 814,168 | ||||||
|
| |||||||
12,197,214 | ||||||||
India 2.3% | ||||||||
Asian Paints Ltd. | 9,738 | 227,143 | ||||||
MakeMyTrip Ltd.* | 20,091 | 296,543 | ||||||
|
| |||||||
523,686 |
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Indonesia 3.2% | ||||||||
Ace Hardware Indonesia Tbk PT | 3,262,455 | $ | 333,372 | |||||
Mitra Adiperkasa Tbk PT | 8,984,751 | 396,788 | ||||||
|
| |||||||
730,160 | ||||||||
Poland 2.0% | ||||||||
Dino Polska SA, 144A* | 10,923 | 460,013 | ||||||
South Korea 8.1% | ||||||||
NAVER Corp. | 3,185 | 516,746 | ||||||
Samsung Electronics Co. Ltd. | 25,350 | 1,038,471 | ||||||
Samsung SDI Co. Ltd. | 1,105 | 260,715 | ||||||
|
| |||||||
1,815,932 | ||||||||
Taiwan 7.9% | ||||||||
Sea Ltd., ADR*(a) | 11,833 | 657,678 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd., ADR | 21,010 | 1,116,261 | ||||||
|
| |||||||
1,773,939 | ||||||||
Thailand 2.8% | ||||||||
CP ALL PCL | 283,066 | 619,525 | ||||||
|
| |||||||
TOTAL LONG-TERM INVESTMENTS | 21,949,947 | |||||||
|
| |||||||
SHORT-TERM INVESTMENTS 11.1% | ||||||||
AFFILIATED MUTUAL FUNDS | ||||||||
PGIM Core Ultra Short Bond Fund(w) | 1,138,508 | 1,138,508 | ||||||
PGIM Institutional Money Market Fund | 1,349,217 | 1,348,948 | ||||||
|
| |||||||
TOTAL SHORT-TERM INVESTMENTS | 2,487,456 | |||||||
|
| |||||||
TOTAL INVESTMENTS 108.7% | 24,437,403 | |||||||
Liabilities in excess of other assets (8.7)% | (1,958,929 | ) | ||||||
|
| |||||||
NET ASSETS 100.0% | $ | 22,478,474 | ||||||
|
|
See Notes to Financial Statements.
10 |
Below is a list of the abbreviation(s) used in the semiannual report:
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
ADR—American Depositary Receipt
LIBOR—London Interbank Offered Rate
* | Non-income producing security. |
(a) | All or a portion of security is on loan. The aggregate market value of such securities, including those sold and pending settlement, is $1,302,207; cash collateral of $1,346,804 (included in liabilities) was received with which the Series purchased highly liquid short-term investments. |
(b) | Represents security, or portion thereof, purchased with cash collateral received for securities on loan and includes dividend reinvestment. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund and PGIM Institutional Money Market Fund. |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | |||||||||||||
Investments in Securities | |||||||||||||||
Assets | |||||||||||||||
Common Stocks | |||||||||||||||
Argentina | $ | 1,642,129 | $ | — | $ | — | |||||||||
Brazil | 2,187,349 | — | — | ||||||||||||
China | 3,386,692 | 8,810,522 | — | ||||||||||||
India | 296,543 | 227,143 | — | ||||||||||||
Indonesia | — | 730,160 | — | ||||||||||||
Poland | — | 460,013 | — | ||||||||||||
South Korea | — | 1,815,932 | — | ||||||||||||
Taiwan | 1,773,939 | — | — | ||||||||||||
Thailand | — | 619,525 | — | ||||||||||||
Affiliated Mutual Funds | 2,487,456 | — | — | ||||||||||||
|
|
|
|
|
| ||||||||||
Total | $ | 11,774,108 | $ | 12,663,295 | $ | — | |||||||||
|
|
|
|
|
|
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Industry Classification:
The industry classification of investments and liabilities in excess of other assets shown as a percentage of net assets as of April 30, 2020 were as follows:
Internet & Direct Marketing Retail | 20.2 | % | ||
Life Sciences Tools & Services | 11.5 | |||
Affiliated Mutual Funds (6.0% represents investments purchased with collateral from securities on loan) | 11.1 | |||
Interactive Media & Services | 8.7 | |||
Biotechnology | 7.5 | |||
Semiconductors & Semiconductor Equipment | 6.6 | |||
Multiline Retail | 6.5 | |||
Food & Staples Retailing | 5.9 | |||
Pharmaceuticals | 4.7 | |||
Technology Hardware, Storage & Peripherals | 4.6 | |||
Entertainment | 2.9 | |||
Beverages | 2.9 | |||
Health Care Providers & Services | 2.9 | % | ||
Textiles, Apparel & Luxury Goods | 2.8 | |||
Software | 2.4 | |||
Diversified Consumer Services | 2.3 | |||
Specialty Retail | 1.5 | |||
IT Services | 1.5 | |||
Electronic Equipment, Instruments & Components | 1.2 | |||
Chemicals | 1.0 | |||
|
| |||
108.7 | ||||
Liabilities in excess of other assets | (8.7 | ) | ||
|
| |||
100.0 | % | |||
|
|
Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series entered into financial instruments/transactions during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for financial instruments/transactions where the legal right to set-off exists is presented in the summary below.
Offsetting of financial instrument/transaction assets and liabilities:
Description | Gross Market Value of Recognized Assets/(Liabilities) | Collateral Pledged/(Received)(1) | Net Amount | ||||||||||||
Securities on Loan | $ | 1,302,207 | $ | (1,302,207 | ) | $ | — | ||||||||
|
|
(1) | Collateral amount disclosed by the Series is limited to the market value of financial instruments/transactions. |
See Notes to Financial Statements.
12 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets |
| |||
Investments at value, including securities on loan of $1,302,207: |
| |||
Unaffiliated investments (cost $16,269,218) | $ | 21,949,947 | ||
Affiliated investments (cost $2,486,230) | 2,487,456 | |||
Foreign currency, at value (cost $9) | 9 | |||
Receivable for Series shares sold | 31,384 | |||
Dividends and interest receivable | 19,045 | |||
Receivable for investments sold | 667 | |||
Prepaid expenses and other assets | 897 | |||
|
| |||
Total Assets | 24,489,405 | |||
|
| |||
Liabilities |
| |||
Payable to broker for collateral for securities on loan | 1,346,804 | |||
Payable for investments purchased | 582,991 | |||
Accrued expenses and other liabilities | 51,753 | |||
Payable for Series shares reacquired | 20,901 | |||
Foreign capital gains tax liability accrued | 3,905 | |||
Distribution fee payable | 1,589 | |||
Affiliated transfer agent fee payable | 1,496 | |||
Management fee payable | 1,492 | |||
|
| |||
Total Liabilities | 2,010,931 | |||
|
| |||
Net Assets | $ | 22,478,474 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 18,615 | ||
Paid-in capital in excess of par | 19,348,807 | |||
Total distributable earnings (loss) | 3,111,052 | |||
|
| |||
Net assets, April 30, 2020 | $ | 22,478,474 | ||
|
|
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 13 |
Statement of Assets and Liabilities (unaudited) (continued)
as of April 30, 2020
Class A | ||||||
Net asset value and redemption price per share, ($3,786,765 ÷ 316,277 shares of common stock issued and outstanding) | $ | 11.97 | ||||
Maximum sales charge (5.50% of offering price) | 0.70 | |||||
|
| |||||
Maximum offering price to public | $ | 12.67 | ||||
|
| |||||
Class C | ||||||
Net asset value, offering price and redemption price per share, | ||||||
($1,090,116 ÷ 94,949 shares of common stock issued and outstanding) | $ | 11.48 | ||||
|
| |||||
Class Z | ||||||
Net asset value, offering price and redemption price per share, | ||||||
($5,446,608 ÷ 448,757 shares of common stock issued and outstanding) | $ | 12.14 | ||||
|
| |||||
Class R6 | ||||||
Net asset value, offering price and redemption price per share, | ||||||
($12,154,985 ÷ 1,001,508 shares of common stock issued and outstanding) | $ | 12.14 | ||||
|
|
See Notes to Financial Statements.
14 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Unaffiliated dividend income (net of $6,938 foreign withholding tax) | $ | 45,899 | ||
Affiliated dividend income | 7,178 | |||
Income from securities lending, net (including affiliated income of $1,926) | 5,134 | |||
|
| |||
Total income | 58,211 | |||
|
| |||
Expenses | ||||
Management fee | 107,070 | |||
Distribution fee(a) | 11,404 | |||
Custodian and accounting fees | 34,946 | |||
Registration fees(a) | 24,552 | |||
Audit fee | 14,725 | |||
Shareholders’ reports | 8,881 | |||
Legal fees and expenses | 8,194 | |||
Transfer agent’s fees and expenses (including affiliated expense of $4,045)(a) | 7,308 | |||
Directors’ fees | 5,503 | |||
Miscellaneous | 10,332 | |||
|
| |||
Total expenses | 232,915 | |||
Less: Fee waiver and/or expense reimbursement(a) | (99,143 | ) | ||
Distribution fee waiver(a) | (978 | ) | ||
|
| |||
Net expenses | 132,794 | |||
|
| |||
Net investment income (loss) | (74,583 | ) | ||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions (including affiliated of $(188)) (net of foreign capital gains taxes $(3,773)) | (548,393 | ) | ||
Foreign currency transactions | (7,130 | ) | ||
|
| |||
(555,523 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments (including affiliated of $1,007) (net of change in foreign capital gains taxes $25,725) | 246,751 | |||
Foreign currencies | (1,358 | ) | ||
|
| |||
245,393 | ||||
|
| |||
Net gain (loss) on investment and foreign currency transactions | (310,130 | ) | ||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | (384,713 | ) | |
|
|
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class Z | Class R6 | |||||||||||||
Distribution fee | 5,866 | 5,538 | — | — | ||||||||||||
Registration fees | 6,138 | 6,138 | 6,138 | 6,138 | ||||||||||||
Transfer agent’s fees and expenses | 4,887 | 617 | 1,787 | 17 | ||||||||||||
Fee waiver and/or expense reimbursement | (23,946 | ) | (10,417 | ) | (18,026 | ) | (46,754 | ) | ||||||||
Distribution fee waiver | (978 | ) | — | — | — |
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 15 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | (74,583 | ) | $ | (39,894 | ) | ||
Net realized gain (loss) on investment and foreign currency transactions | (555,523 | ) | 435,532 | |||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | 245,393 | 3,689,760 | ||||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | (384,713 | ) | 4,085,398 | |||||
|
|
|
| |||||
Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 4,825,099 | 2,787,608 | ||||||
Cost of shares reacquired | (1,550,567 | ) | (1,852,092 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | 3,274,532 | 935,516 | ||||||
|
|
|
| |||||
Total increase (decrease) | 2,889,819 | 5,020,914 | ||||||
Net Assets: | ||||||||
Beginning of period | 19,588,655 | 14,567,741 | ||||||
|
|
|
| |||||
End of period | $ | 22,478,474 | $ | 19,588,655 | ||||
|
|
|
|
See Notes to Financial Statements.
16 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company. The Fund was established as a Maryland business trust on September 28, 1994. The Fund currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act and may invest a greater percentage of their assets in the securities of a single company or other issuer than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund. These financial statements relate only to the PGIM Jennison Emerging Markets Equity Opportunities Fund (the “Series”).
The investment objective of the Series is to seek long-term growth of capital.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services — Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund’s Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 17 |
Notes to Financial Statements (unaudited) (continued)
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Common and preferred stocks, exchange-traded funds, and derivative instruments, such as futures or options, that are traded on a national securities exchange are valued at the last sale price as of the close of trading on the applicable exchange where the security principally trades. Securities traded via NASDAQ are valued at the NASDAQ official closing price. To the extent these securities are valued at the last sale price or NASDAQ official closing price, they are classified as Level 1 in the fair value hierarchy. In the event that no sale or official closing price on valuation date exists, these securities are generally valued at the mean between the last reported bid and ask prices, or at the last bid price in the absence of an ask price. These securities are classified as Level 2 in the fair value hierarchy.
Foreign equities traded on foreign securities exchanges are generally valued using pricing vendor services that provide model prices derived using adjustment factors based on information such as local closing price, relevant general and sector indices, currency fluctuations, depositary receipts, and futures, as applicable. Securities valued using such model prices are classified as Level 2 in the fair value hierarchy. The models generate an evaluated adjustment factor for each security, which is applied to the local closing price to adjust it for post closing market movements up to the time the Series is valued. Utilizing that evaluated adjustment factor, the vendor provides an evaluated price for each security. If the vendor does not provide an evaluated price, securities are valued in accordance with exchange-traded common and preferred stock valuation policies discussed above.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
18 |
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 19 |
Notes to Financial Statements (unaudited) (continued)
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally 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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions.
Net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Master Netting Arrangements: The Series is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
Securities Lending: The Series lends its portfolio securities to banks and broker-dealers. The loans are secured by collateral at least equal to the market value of the securities loaned. Collateral pledged by each borrower is invested in an affiliated money market fund and is marked to market daily, based on the previous day’s market value, such that the value of the collateral exceeds the value of the loaned securities. In the event of significant appreciation in value of securities on loan on the last business day of the reporting period, the financial statements may reflect a collateral value that is less than the market value of the loaned securities. Such shortfall is remedied as described above. Loans are subject to termination at the option of the borrower or the Series. Upon termination of the loan, the borrower will
20 |
return to the Series securities identical to the loaned securities. Should the borrower of the securities fail financially, the Series has the right to repurchase the securities in the open market using the collateral.
The Series recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The borrower receives all interest and dividends from the securities loaned and such payments are passed back to the lender in amounts equivalent thereto. The Series also continues to recognize any unrealized gain (loss) in the market price of the securities loaned and on the change in the value of the collateral invested that may occur during the term of the loan. In addition, realized gain (loss) is recognized on changes in the value of the collateral invested upon liquidation of the collateral. Net earnings from securities lending are disclosed in the Statement of Operations.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to pay dividends from net investment income and distributions from net realized capital and currency gains, if any, annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial
PGIM Jennison Emerging Markets Equity Opportunities Fund | 21 |
Notes to Financial Statements (unaudited) (continued)
statements. Actual results could differ from those estimates.
2. Agreements
The Series has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with Jennison Associates LLC (“Jennison”). The subadvisory agreement provides that Jennison will furnish investment advisory services in connection with the management of the Series. In connection therewith, Jennison is obligated to keep certain books and records of the Series. The Manager pays for the services of Jennison, the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
The management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 1.05% of the Series’ average daily net assets up to $5 billion and 1.025% of the Series’ average daily net assets in excess of . The effective management fee rate before any waivers and/or expense reimbursements was 1.05% for the reporting period ended April 30, 2020.
The Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.45% of average daily net assets for Class A shares, 2.20% of average daily net assets for Class C shares, 1.20% of average daily net assets for Class Z shares and 1.20% of average daily net assets for Class R6 shares. The contractual waiver excludes interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extra ordinary expenses and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
22 |
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class. In addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver and/or reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class Z and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A and Class C shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z and Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.30% and 1% of the average daily net assets of the Class A and Class C shares, respectively. PIMS has contractually agreed through February 28, 2021 to limit such fee to 0.25% of the average daily net assets of the Class A shares.
For the reporting period ended April 30, 2020, PIMS received $6,730 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS received $30 in contingent deferred sales charges imposed upon redemptions by certain Class C shareholders. From these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
PGIM Investments, PIMS and Jennison are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PGIM Investments and an indirect, wholly-owned subsidiary of Prudential, serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), and its securities lending cash collateral in the PGIM Institutional Money Market Fund (the “Money Market Fund”), each a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are
PGIM Jennison Emerging Markets Equity Opportunities Fund | 23 |
Notes to Financial Statements (unaudited) (continued)
paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund and Money Market Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income” and “Income from securities lending, net”, respectively.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Fund’s Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $10,395,851 and $6,862,834, respectively.
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
Value, Beginning of Period | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 980,284 | $ | 7,855,846 | $ | 7,697,622 | $ | — | $ | — | $ | 1,138,508 | 1,138,508 | $ | 7,178 | ||||||||||||||||
PGIM Institutional Money Market Fund* | ||||||||||||||||||||||||||||||
840,097 | 4,302,820 | 3,794,788 | 1,007 | (188) | 1,348,948 | 1,349,217 | 1,926** | |||||||||||||||||||||||
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| |||||||||||||||||
$ | 1,820,381 | $ | 12,158,666 | $ | 11,492,410 | $ | 1,007 | $ | (188) | $ | 2,487,456 | $ | 9,104 | |||||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
** | Represents the affiliated amount of securities lending income shown on the Statement of Operations. |
24 |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized appreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 18,760,755 | ||
|
| |||
Gross Unrealized Appreciation | 6,245,170 | |||
Gross Unrealized Depreciation | (568,522 | ) | ||
|
| |||
Net Unrealized Appreciation | $ | 5,676,648 | ||
|
|
The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $1,919,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Series elected to treat late year ordinary income losses of approximately $17,000 as having been incurred in the following fiscal year (October 31, 2020).
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class C, Class Z and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 5.50%. Investors who purchase $1 million or more of Class A shares and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1%, although they are not subject to an initial sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 25 |
Notes to Financial Statements (unaudited) (continued)
The Fund is authorized to issue 5.075 billion shares of common stock, $0.01 par value per share, 865 million of which are designated as shares of the Series. The shares are further classified and designated as follows:
Class A | 25,000,000 | |||
Class C | 65,000,000 | |||
Class Z | 300,000,000 | |||
Class T | 225,000,000 | |||
Class R6 | 250,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class R6 | 1,000,515 | 99.9 | % |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
1 | 54% | 2 | 30% |
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 45,226 | $ | 552,431 | |||||
Shares reacquired | (41,982 | ) | (486,141 | ) | ||||
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| |||||
Net increase (decrease) in shares outstanding before conversion | 3,244 | 66,290 | ||||||
Shares issued upon conversion from other share class(es) | 35 | 435 | ||||||
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| |||||
Net increase (decrease) in shares outstanding | 3,279 | $ | 66,725 | |||||
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| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 68,342 | $ | 742,030 | |||||
Shares reacquired | (49,407 | ) | (551,008 | ) | ||||
|
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| |||||
Net increase (decrease) in shares outstanding before conversion | 18,935 | 191,022 | ||||||
Shares issued upon conversion from other share class(es) | 54,791 | 650,850 | ||||||
Shares reacquired upon conversion into other share class(es) | (2,537 | ) | (29,217 | ) | ||||
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| |||||
Net increase (decrease) in shares outstanding | 71,189 | $ | 812,655 | |||||
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|
26 |
Class C | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 5,789 | $ | 65,897 | |||||
Shares reacquired | (5,370 | ) | (62,988 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 419 | 2,909 | ||||||
Shares reacquired upon conversion into other share class(es) | (36 | ) | (435 | ) | ||||
|
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| |||||
Net increase (decrease) in shares outstanding | 383 | $ | 2,474 | |||||
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| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 21,925 | $ | 221,071 | |||||
Shares reacquired | (16,064 | ) | (176,097 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 5,861 | 44,974 | ||||||
Shares reacquired upon conversion into other share class(es) | (58,037 | ) | (663,567 | ) | ||||
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| |||||
Net increase (decrease) in shares outstanding | (52,176 | ) | $ | (618,593 | ) | |||
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| |||||
Class Z | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 341,627 | $ | 4,194,385 | |||||
Shares reacquired | (84,258 | ) | (1,001,438 | ) | ||||
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| |||||
Net increase (decrease) in shares outstanding | 257,369 | $ | 3,192,947 | |||||
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| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 161,778 | $ | 1,824,507 | |||||
Shares reacquired | (99,711 | ) | (1,124,987 | ) | ||||
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|
| |||||
Net increase (decrease) in shares outstanding before conversion | 62,067 | 699,520 | ||||||
Shares issued upon conversion from other share class(es) | 3,723 | 41,934 | ||||||
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| |||||
Net increase (decrease) in shares outstanding | 65,790 | $ | 741,454 | |||||
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| |||||
Class R6 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 993 | $ | 12,386 | |||||
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| |||||
Net increase (decrease) in shares outstanding | 993 | $ | 12,386 | |||||
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| |||||
Year ended October 31, 2019: | ||||||||
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| |||||
Net increase (decrease) in shares outstanding | — | $ | — | |||||
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7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $ 1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% |
PGIM Jennison Emerging Markets Equity Opportunities Fund | 27 |
Notes to Financial Statements (unaudited) (continued)
SCA | ||
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent |
* | Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series did not utilize the SCA during the reporting period ended April 30, 2020.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Equity and Equity-Related Securities Risks: The value of a particular security could go down and you could lose money. In addition to an individual security losing value, the value of the equity markets or a sector in which the Series invests could go down. The Series’ holdings can vary significantly from broad market indexes and the performance of the Series can deviate from the performance of these indexes. Different parts of a market can react differently to adverse issuer, market, regulatory, political and economic developments.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
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Geographic Concentration Risk: The Series’ performance may be closely tied to the market, economic, political, regulatory or other conditions in the countries or regions in which the Series invests. This can result in more pronounced risks based upon conditions that impact one or more countries or regions more or less than other countries or regions.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are
PGIM Jennison Emerging Markets Equity Opportunities Fund | 29 |
Notes to Financial Statements (unaudited) (continued)
effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
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Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $12.16 | $9.58 | $11.19 | $9.34 | $8.81 | $10.09 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.05 | ) | (0.04 | ) | (0.04 | ) | (0.04 | ) | (0.04 | ) | (0.04 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.14 | ) | 2.62 | (1.57 | ) | 1.89 | 0.57 | (1.24 | ) | |||||||||||||||||||
Total from investment operations | (0.19 | ) | 2.58 | (1.61 | ) | 1.85 | 0.53 | (1.28 | ) | |||||||||||||||||||
Net asset value, end of period | $11.97 | $12.16 | $9.58 | $11.19 | $9.34 | $8.81 | ||||||||||||||||||||||
Total Return(b): | (1.56)% | 26.93% | (14.39)% | 19.81% | 6.02% | (12.69)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $3,787 | $3,806 | $2,316 | $2,204 | $869 | $311 | ||||||||||||||||||||||
Average net assets (000) | $3,932 | $3,074 | $2,956 | $1,363 | $528 | $208 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.45% | (e) | 1.45% | 1.45% | 1.45% | 1.45% | 1.54% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.72% | (e) | 3.35% | 3.27% | 3.28% | 3.87% | 3.40% | |||||||||||||||||||||
Net investment income (loss) | (0.89)% | (e) | (0.37)% | (0.35)% | (0.35)% | (0.49)% | (0.48)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 35% | 33% | 23% | 45% | 44% | 67% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 31 |
Financial Highlights (unaudited) (continued)
Class C Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $11.71 | $9.29 | $10.93 | $9.20 | $8.74 | $10.08 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.10 | ) | (0.11 | ) | (0.13 | ) | (0.11 | ) | (0.11 | ) | (0.13 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.13 | ) | 2.53 | (1.51 | ) | 1.84 | 0.57 | (1.21 | ) | |||||||||||||||||||
Total from investment operations | (0.23 | ) | 2.42 | (1.64 | ) | 1.73 | 0.46 | (1.34 | ) | |||||||||||||||||||
Net asset value, end of period | $11.48 | $11.71 | $9.29 | $10.93 | $9.20 | $8.74 | ||||||||||||||||||||||
Total Return(b): | (1.96)% | 26.05% | (15.00)% | 18.80% | 5.26% | (13.29)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $1,090 | $1,107 | $1,363 | $1,516 | $734 | $662 | ||||||||||||||||||||||
Average net assets (000) | $1,114 | $1,438 | $1,775 | $973 | $672 | $699 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 2.20% | (e) | 2.20% | 2.20% | 2.20% | 2.20% | 2.29% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 4.08% | (e) | 4.23% | 4.20% | 4.00% | 4.62% | 4.12% | |||||||||||||||||||||
Net investment income (loss) | (1.64)% | (e) | (1.05)% | (1.14)% | (1.17)% | (1.29)% | (1.36)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 35% | 33% | 23% | 45% | 44% | 67% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
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Class Z Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $12.31 | $9.67 | $11.27 | $9.39 | $8.82 | $10.09 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.04 | ) | (0.01 | ) | (0.01 | ) | (0.02 | ) | (0.03 | ) | (0.04 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.13 | ) | 2.65 | (1.59 | ) | 1.90 | 0.60 | (1.23 | ) | |||||||||||||||||||
Total from investment operations | (0.17 | ) | 2.64 | (1.60 | ) | 1.88 | 0.57 | (1.27 | ) | |||||||||||||||||||
Net asset value, end of period | $12.14 | $12.31 | $9.67 | $11.27 | $9.39 | $8.82 | ||||||||||||||||||||||
Total Return(b): | (1.38)% | 27.30% | (14.20)% | 20.02% | 6.46% | (12.59)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $5,447 | $2,357 | $1,215 | $980 | $183 | $60 | ||||||||||||||||||||||
Average net assets (000) | $3,122 | $1,866 | $1,443 | $490 | $102 | $17 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.20% | (e) | 1.20% | 1.20% | 1.20% | 1.20% | 1.29% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.36% | (e) | 3.17% | 3.56% | 2.94% | 3.55% | 3.48% | |||||||||||||||||||||
Net investment income (loss) | (0.57)% | (e) | (0.08)% | (0.13)% | (0.19)% | (0.31)% | (0.44)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 35% | 33% | 23% | 45% | 44% | 67% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 33 |
Financial Highlights (unaudited) (continued)
Class R6 Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $12.31 | $9.67 | $11.27 | $9.39 | $8.83 | $10.09 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.04 | ) | (0.01 | ) | (0.02 | ) | (0.01 | ) | (0.03 | ) | (0.04 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (0.13 | ) | 2.65 | (1.58 | ) | 1.89 | 0.59 | (1.21 | ) | |||||||||||||||||||
Total from investment operations | (0.17 | ) | 2.64 | (1.60 | ) | 1.88 | 0.56 | (1.25 | ) | |||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | - | - | - | - | - | (0.01 | ) | |||||||||||||||||||||
Net asset value, end of period | $12.14 | $12.31 | $9.67 | $11.27 | $9.39 | $8.83 | ||||||||||||||||||||||
Total Return(b): | (1.38)% | 27.30% | (14.20)% | 20.02% | 6.34% | (12.44)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $12,155 | $12,319 | $9,675 | $11,271 | $9,404 | $8,840 | ||||||||||||||||||||||
Average net assets (000) | $12,339 | $11,249 | $11,852 | $9,893 | $8,722 | $9,518 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.20% | (e) | 1.20% | 1.20% | 1.20% | 1.20% | 1.29% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.96% | (e) | 2.41% | 2.32% | 2.78% | 3.13% | 2.91% | |||||||||||||||||||||
Net investment income (loss) | (0.64)% | (e) | (0.11)% | (0.17)% | (0.13)% | (0.29)% | (0.40)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 35% | 33% | 23% | 45% | 44% | 67% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
34 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Jennison Emerging Markets Equity Opportunities Fund | 35 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | Jennison Associates LLC | 466 Lexington Avenue New York, NY 10017 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street New York, NY 10286 | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue New York, NY 10017 | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM JENNISON EMERGING MARKETS EQUITY OPPORTUNITIES FUND
SHARE CLASS | A | C | Z | R6 | ||||
NASDAQ | PDEAX | PDECX | PDEZX | PDEQX | ||||
CUSIP | 743969644 | 743969636 | 743969610 | 743969628 |
MF225E2
PGIM JENNISON GLOBAL OPPORTUNITIES FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
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This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC, member SIPC. Jennison Associates LLC is a registered investment adviser. Both are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, PGIM, and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
2 | Visit our website at pgiminvestments.com |
Dear Shareholder:
We hope you find the semiannual report for PGIM Jennison Global Opportunities Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Jennison Global Opportunities Fund
June 15, 2020
PGIM Jennison Global Opportunities Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
(without sales charges) | Average Annual Total Returns as of 4/30/20 (with sales charges) | |||||||
Six Months* (%) | One Year (%) | Five Years (%) | Since Inception (%) | |||||
Class A | 11.27 | 3.88 | 11.14 | 12.39 (3/14/12) | ||||
Class C | 10.84 | 8.00 | 11.52 | 12.29 (3/14/12) | ||||
Class Z | 11.40 | 10.12 | 12.65 | 13.43 (3/14/12) | ||||
Class R2 | 11.19 | 9.70 | N/A | 25.09 (12/27/18) | ||||
Class R4 | 11.32 | 10.01 | N/A | 25.43 (12/27/18) | ||||
Class R6 | 11.42 | 10.19 | 12.76 | 13.58 (12/22/14) | ||||
MSCI ACWI ND Index | ||||||||
–7.68 | –4.96 | 4.37 | — |
Average Annual Total Returns as of 4/30/20 Since Inception (%) | ||||||
Class A, C, Z (3/14/12) | Class R2, R4 (12/27/18) | Class R6 (12/22/14) | ||||
MSCI ACWI ND Index | 7.03 | 7.57 | 5.10 |
*Not annualized
Source: PGIM Investments LLC and Lipper Inc.
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to each class’ inception date.
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The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class Z | Class R2 | Class R4 | Class R6 | |||||||
Maximum initial sales charge | 5.50% of the public offering price | None | None | None | None | None | ||||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 1.00% on sales made within 12 months of purchase | None | None | None | None | ||||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% (0.25% currently) | 1.00% | None | 0.25% | None | None | ||||||
Shareholder services fees | None | None | None | 0.10% | 0.10% | None |
Benchmark Definitions
MSCI ACWI ND Index—The Morgan Stanley Capital International All Country World Net Dividend Index (MSCI ACWI ND Index) is an unmanaged free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI ND Index consists of 47 country indexes comprising 23 developed and 24 emerging market country indexes. The ND version of the MSCI ACWI Index reflects the impact of the maximum withholding taxes on reinvested dividends.
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
PGIM Jennison Global Opportunities Fund | 5 |
Your Fund’s Performance (continued)
Presentation of Fund Holdings as of 4/30/20
Ten Largest Holdings | Line of Business | Country | % of Net Assets | |||
Amazon.com, Inc. | Internet & Direct Marketing Retail | United States | 7.5% | |||
Microsoft Corp. | Software | United States | 5.3% | |||
Netflix, Inc. | Entertainment | United States | 4.9% | |||
Adyen NV, 144A | IT Services | Netherlands | 4.5% | |||
Alibaba Group Holding Ltd., ADR | Internet & Direct Marketing Retail | China | 4.1% | |||
Apple, Inc. | Technology Hardware, Storage & Peripherals | United States | 4.0% | |||
Tesla, Inc. | Automobiles | United States | 3.9% | |||
Mastercard, Inc. (Class A Stock) | IT Services | United States | 3.6% | |||
Shopify, Inc. (Class A Stock) | IT Services | Canada | 3.6% | |||
Wuxi Biologics Cayman, Inc., 144A | Life Sciences Tools & Services | China | 3.6% |
Holdings reflect only long-term investments and are subject to change.
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As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
PGIM Jennison Global Opportunities Fund | 7 |
Fees and Expenses (continued)
and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Jennison Global Opportunities Fund | Beginning Account Value November 1, 2019 | Ending Account Value April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 1,112.70 | 1.08 | % | $ | 5.67 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.49 | 1.08 | % | $ | 5.42 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 1,108.40 | 1.93 | % | $ | 10.12 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,015.27 | 1.93 | % | $ | 9.67 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 1,114.00 | 0.92 | % | $ | 4.84 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.29 | 0.92 | % | $ | 4.62 | ||||||||||
Class R2 | Actual | $ | 1,000.00 | $ | 1,111.90 | 1.14 | % | $ | 5.99 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.19 | 1.14 | % | $ | 5.72 | ||||||||||
Class R4 | Actual | $ | 1,000.00 | $ | 1,113.20 | 0.96 | % | $ | 5.04 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.09 | 0.96 | % | $ | 4.82 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 1,114.20 | 0.84 | % | $ | 4.42 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.69 | 0.84 | % | $ | 4.22 |
*Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
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Schedule of Investments (unaudited)
as of April 30, 2020
Description | Shares | Value | ||||||
LONG-TERM INVESTMENTS 98.8% | ||||||||
COMMON STOCKS | ||||||||
Argentina 1.9% | ||||||||
MercadoLibre, Inc.* | 109,454 | $ | 63,867,504 | |||||
Canada 3.6% | ||||||||
Shopify, Inc. (Class A Stock)* | 197,410 | 124,820,369 | ||||||
China 14.2% | ||||||||
Alibaba Group Holding Ltd., ADR* | 690,241 | 139,891,144 | ||||||
Li Ning Co. Ltd. | 9,012,112 | 28,403,539 | ||||||
Meituan Dianping (Class B Stock)* | 7,790,971 | 103,912,376 | ||||||
Tencent Holdings Ltd. | 1,765,637 | 93,446,542 | ||||||
Wuxi Biologics Cayman, Inc., 144A* | 8,010,244 | 124,210,472 | ||||||
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| |||||||
489,864,073 | ||||||||
France 11.3% | ||||||||
Hermes International | 62,407 | 45,728,423 | ||||||
Kering SA | 152,664 | 77,817,977 | ||||||
L’Oreal SA* | 225,261 | 65,799,554 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 286,967 | 111,863,960 | ||||||
Pernod Ricard SA | 280,080 | 42,661,473 | ||||||
Remy Cointreau SA(a) | 388,694 | 43,359,725 | ||||||
|
| |||||||
387,231,112 | ||||||||
Italy 3.0% | ||||||||
Ferrari NV | 660,414 | 103,936,810 | ||||||
Netherlands 6.0% | ||||||||
Adyen NV, 144A* | 157,620 | 154,769,246 | ||||||
ASML Holding NV | 173,935 | 50,921,161 | ||||||
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| |||||||
205,690,407 | ||||||||
Switzerland 5.4% | ||||||||
Alcon, Inc.* | 839,155 | 44,164,743 | ||||||
Givaudan SA | 23,816 | 79,927,150 | ||||||
Roche Holding AG | 173,167 | 60,302,662 | ||||||
|
| |||||||
184,394,555 | ||||||||
United Kingdom 2.0% | ||||||||
Experian PLC | 2,362,040 | 70,401,273 |
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
United States 51.4% | ||||||||
Adobe, Inc.* | 182,456 | $ | 64,523,740 | |||||
Amazon.com, Inc.* | 104,270 | 257,963,980 | ||||||
Apple, Inc. | 465,528 | 136,772,126 | ||||||
Atlassian Corp. PLC (Class A Stock)* | 270,739 | 42,097,207 | ||||||
Coupa Software, Inc.*(a) | 98,249 | 17,300,666 | ||||||
Crowdstrike Holdings, Inc. (Class A Stock)* | 964,486 | 65,257,123 | ||||||
DexCom, Inc.* | 222,741 | 74,662,783 | ||||||
Dynatrace, Inc.* | 2,117,414 | 63,204,808 | ||||||
Edwards Lifesciences Corp.*(a) | 243,904 | 53,049,120 | ||||||
Facebook, Inc. (Class A Stock)* | 359,022 | 73,495,394 | ||||||
Lululemon Athletica, Inc.*(a) | 370,746 | 82,854,316 | ||||||
Mastercard, Inc. (Class A Stock) | 454,742 | 125,040,408 | ||||||
Microsoft Corp. | 1,012,596 | 181,467,329 | ||||||
Netflix, Inc.* | 399,392 | 167,684,731 | ||||||
NVIDIA Corp. | 230,087 | 67,249,828 | ||||||
RingCentral, Inc. (Class A Stock)* | 448,282 | 102,445,886 | ||||||
salesforce.com, Inc.* | 236,318 | 38,271,700 | ||||||
Tesla, Inc.*(a) | 171,092 | 133,773,413 | ||||||
Trade Desk, Inc. (The) (Class A Stock)*(a) | 66,859 | 19,561,606 | ||||||
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| |||||||
1,766,676,164 | ||||||||
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| |||||||
TOTAL LONG-TERM INVESTMENTS | 3,396,882,267 | |||||||
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| |||||||
SHORT-TERM INVESTMENTS 7.4% | ||||||||
AFFILIATED MUTUAL FUNDS | ||||||||
PGIM Core Ultra Short Bond Fund(w) | 36,135,151 | 36,135,151 | ||||||
PGIM Institutional Money Market Fund | 217,922,859 | 217,879,274 | ||||||
|
| |||||||
TOTAL SHORT-TERM INVESTMENTS | 254,014,425 | |||||||
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| |||||||
TOTAL INVESTMENTS 106.2% | 3,650,896,692 | |||||||
Liabilities in excess of other assets (6.2)% | (213,986,154 | ) | ||||||
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| |||||||
NET ASSETS 100.0% | $ | 3,436,910,538 | ||||||
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Below is a list of the abbreviation(s) used in the semiannual report:
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
ADR—American Depositary Receipt
See Notes to Financial Statements.
10 |
LIBOR—London Interbank Offered Rate
* | Non-income producing security. |
(a) | All or a portion of security is on loan. The aggregate market value of such securities, including those sold and pending settlement, is $210,310,739; cash collateral of $217,503,963 (included in liabilities) was received with which the Series purchased highly liquid short-term investments. |
(b) | Represents security, or portion thereof, purchased with cash collateral received for securities on loan and includes dividend reinvestment. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund and PGIM Institutional Money Market Fund. |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Common Stocks | ||||||||||||
Argentina | $ | 63,867,504 | $ | — | $ | — | ||||||
Canada | 124,820,369 | — | — | |||||||||
China | 139,891,144 | 349,972,929 | — | |||||||||
France | — | 387,231,112 | — | |||||||||
Italy | — | 103,936,810 | — | |||||||||
Netherlands | — | 205,690,407 | — | |||||||||
Switzerland | — | 184,394,555 | — | |||||||||
United Kingdom | — | 70,401,273 | — | |||||||||
United States | 1,766,676,164 | — | — | |||||||||
Affiliated Mutual Funds | 254,014,425 | — | — | |||||||||
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|
|
|
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| |||||||
Total | $ | 2,349,269,606 | $ | 1,301,627,086 | $ | — | ||||||
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Industry Classification:
The industry classification of investments and liabilities in excess of other assets shown as a percentage of net assets as of April 30, 2020 were as follows:
Software | 17.3 | % | ||
Internet & Direct Marketing Retail | 16.5 | |||
IT Services | 11.7 | |||
Textiles, Apparel & Luxury Goods | 10.1 | |||
Affiliated Mutual Funds (6.3% represents investments purchased with collateral from securities on loan) | 7.4 | % | ||
Automobiles | 6.9 | |||
Health Care Equipment & Supplies | 5.0 |
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Industry Classification (continued):
Entertainment | 4.9 | % | ||
Interactive Media & Services | 4.8 | |||
Technology Hardware, Storage & Peripherals | 4.0 | |||
Life Sciences Tools & Services | 3.6 | |||
Semiconductors & Semiconductor Equipment | 3.5 | |||
Beverages | 2.5 | |||
Chemicals | 2.3 | |||
Professional Services | 2.0 | |||
Personal Products | 1.9 | % | ||
Pharmaceuticals | 1.8 | |||
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| |||
106.2 | ||||
Liabilities in excess of other assets | (6.2 | ) | ||
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| |||
100.0 | % | |||
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Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series entered into financial instruments/transactions during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for financial instruments/transactions where the legal right to set-off exists is presented in the summary below.
Offsetting of financial instrument/transaction assets and liabilities:
Description | Gross Market Value of Recognized Assets/(Liabilities) | Collateral Pledged/(Received)(1) | Net Amount | |||||||||
Securities on Loan | $ | 210,310,739 | $ | (210,310,739 | ) | $ | — | |||||
|
|
(1) | Collateral amount disclosed by the Series is limited to the market value of financial instruments/transactions. |
See Notes to Financial Statements.
12 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value, including securities on loan of $210,310,739: | ||||
Unaffiliated investments (cost $2,621,073,227) | $ | 3,396,882,267 | ||
Affiliated investments (cost $253,802,488) | 254,014,425 | |||
Foreign currency, at value (cost $1,044,289) | 1,055,101 | |||
Receivable for Series shares sold | 26,713,458 | |||
Dividends and interest receivable | 1,115,856 | |||
Tax reclaim receivable | 787,903 | |||
Prepaid expenses | 5,833 | |||
|
| |||
Total Assets | 3,680,574,843 | |||
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| |||
Liabilities | ||||
Payable to broker for collateral for securities on loan | 217,503,963 | |||
Payable for Series shares reacquired | 19,311,467 | |||
Payable for investments purchased | 3,891,374 | |||
Management fee payable | 2,009,929 | |||
Accrued expenses and other liabilities | 669,056 | |||
Distribution fee payable | 238,368 | |||
Affiliated transfer agent fee payable | 40,148 | |||
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| |||
Total Liabilities | 243,664,305 | |||
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| |||
Net Assets | $ | 3,436,910,538 | ||
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| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 1,241,630 | ||
Paid-in capital in excess of par | 2,802,821,578 | |||
Total distributable earnings (loss) | 632,847,330 | |||
|
| |||
Net assets, April 30, 2020 | $ | 3,436,910,538 | ||
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|
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 13 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Class A | ||||
Net asset value and redemption price per share, | $ | 27.35 | ||
Maximum sales charge (5.50% of offering price) | 1.59 | |||
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Maximum offering price to public | $ | 28.94 | ||
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Class C | ||||
Net asset value, offering price and redemption price per share, | $ | 25.67 | ||
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Class Z | ||||
Net asset value, offering price and redemption price per share, | $ | 27.86 | ||
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| |||
Class R2 | ||||
Net asset value, offering price and redemption price per share, | $ | 27.82 | ||
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| |||
Class R4 | ||||
Net asset value, offering price and redemption price per share, | $ | 27.92 | ||
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| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | $ | 28.00 | ||
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See Notes to Financial Statements.
14 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Unaffiliated dividend income (net of $815,848 foreign withholding tax) | $ | 6,793,900 | ||
Affiliated dividend income | 384,015 | |||
Income from securities lending, net (including affiliated income of $364,407) | 374,325 | |||
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| |||
Total income | 7,552,240 | |||
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| |||
Expenses | ||||
Management fee | 11,718,517 | |||
Distribution fee(a) | 1,536,282 | |||
Shareholder servicing fees(a) | 184 | |||
Transfer agent’s fees and expenses (including affiliated expense of $101,863)(a) | 952,862 | |||
Custodian and accounting fees | 175,834 | |||
Registration fees(a) | 106,075 | |||
SEC registration fees | 59,432 | |||
Shareholders’ reports | 59,166 | |||
Directors’ fees | 18,860 | |||
Legal fees and expenses | 14,526 | |||
Audit fee | 13,768 | |||
Miscellaneous | 26,366 | |||
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| |||
Total expenses | 14,681,872 | |||
Less: Fee waiver and/or expense reimbursement(a) | (217,521 | ) | ||
Distribution fee waiver(a) | (65,605 | ) | ||
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| |||
Net expenses | 14,398,746 | |||
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| |||
Net investment income (loss) | (6,846,506 | ) | ||
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| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions (including affiliated of $(184,960)) | (59,001,167 | ) | ||
Foreign currency transactions | 26,845 | |||
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| |||
(58,974,322 | ) | |||
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| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments (including affiliated of $166,231) | 387,830,996 | |||
Foreign currencies | 14,840 | |||
|
| |||
387,845,836 | ||||
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| |||
Net gain (loss) on investment and foreign currency transactions | 328,871,514 | |||
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| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | 322,025,008 | ||
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See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 15 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class Z | Class R2 | Class R4 | Class R6 | |||||||||||||||||||
Distribution fee | 393,629 | 1,142,529 | — | 124 | — | — | ||||||||||||||||||
Shareholder servicing fees | — | — | — | — | 184 | — | ||||||||||||||||||
Transfer agent’s fees and expenses | 127,051 | 106,076 | 716,943 | 23 | 160 | 2,609 | ||||||||||||||||||
Registration fees | 13,745 | 12,493 | 34,511 | 8,055 | 8,055 | 29,216 | ||||||||||||||||||
Fee waiver and/or expense reimbursement | (146,180 | ) | (5,732 | ) | (34,203 | ) | (8,051 | ) | (8,172 | ) | (15,183 | ) | ||||||||||||
Distribution fee waiver | (65,605 | ) | — | — | — | — | — |
See Notes to Financial Statements.
16 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | (6,846,506 | ) | $ | (8,341,596 | ) | ||
Net realized gain (loss) on investment and foreign currency transactions | (58,974,322 | ) | (15,157,102 | ) | ||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | 387,845,836 | 265,888,200 | ||||||
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| |||||
Net increase (decrease) in net assets resulting from operations | 322,025,008 | 242,389,502 | ||||||
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Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 1,033,750,579 | 1,382,201,174 | ||||||
Cost of shares reacquired | (474,637,367 | ) | (582,671,951 | ) | ||||
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| |||||
Net increase (decrease) in net assets from Series share transactions | 559,113,212 | 799,529,223 | ||||||
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| |||||
Total increase (decrease) | 881,138,220 | 1,041,918,725 | ||||||
Net Assets: | ||||||||
Beginning of period | 2,555,772,318 | 1,513,853,593 | ||||||
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End of period | $ | 3,436,910,538 | $ | 2,555,772,318 | ||||
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See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 17 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act and may invest a greater percentage of their assets in the securities of a single company or other issuer than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund. These financial statements relate only to the PGIM Jennison Global Opportunities Fund (the “Series”).
The investment objective of the Series is to seek long-term growth of capital.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services — Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund’s Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur
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when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Common and preferred stocks, exchange-traded funds, and derivative instruments, such as futures or options, that are traded on a national securities exchange are valued at the last sale price as of the close of trading on the applicable exchange where the security principally trades. Securities traded via NASDAQ are valued at the NASDAQ official closing price. To the extent these securities are valued at the last sale price or NASDAQ official closing price, they are classified as Level 1 in the fair value hierarchy. In the event that no sale or official closing price on valuation date exists, these securities are generally valued at the mean between the last reported bid and ask prices, or at the last bid price in the absence of an ask price. These securities are classified as Level 2 in the fair value hierarchy.
Foreign equities traded on foreign securities exchanges are generally valued using pricing vendor services that provide model prices derived using adjustment factors based on information such as local closing price, relevant general and sector indices, currency fluctuations, depositary receipts, and futures, as applicable. Securities valued using such model prices are classified as Level 2 in the fair value hierarchy. The models generate an evaluated adjustment factor for each security, which is applied to the local closing price to adjust it for post closing market movements up to the time the Series is valued. Utilizing that evaluated adjustment factor, the vendor provides an evaluated price for each security. If the vendor does not provide an evaluated price, securities are valued in accordance with exchange-traded common and preferred stock valuation policies discussed above.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of
PGIM Jennison Global Opportunities Fund | 19 |
Notes to Financial Statements (unaudited) (continued)
the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses — at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally isolate that portion of
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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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions.
Net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Master Netting Arrangements: The Fund, on behalf of the Series, is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
Securities Lending: The Series lends its portfolio securities to banks and broker-dealers. The loans are secured by collateral at least equal to the market value of the securities loaned. Collateral pledged by each borrower is invested in an affiliated money market fund and is marked to market daily, based on the previous day’s market value, such that the value of the collateral exceeds the value of the loaned securities. In the event of significant appreciation in value of securities on loan on the last business day of the reporting period, the financial statements may reflect a collateral value that is less than the market value of the loaned securities. Such shortfall is remedied as described above. Loans are subject to termination at the option of the borrower or the Series. Upon termination of the loan, the borrower will return to the Series securities identical to the loaned securities. Should the borrower of the securities fail financially, the Series has the right to repurchase the securities in the open market using the collateral.
PGIM Jennison Global Opportunities Fund | 21 |
Notes to Financial Statements (unaudited) (continued)
The Series recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The borrower receives all interest and dividends from the securities loaned and such payments are passed back to the lender in amounts equivalent thereto. The Series also continues to recognize any unrealized gain (loss) in the market price of the securities loaned and on the change in the value of the collateral invested that may occur during the term of the loan. In addition, realized gain (loss) is recognized on changes in the value of the collateral invested upon liquidation of the collateral. Net earnings from securities lending are disclosed in the Statement of Operations.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to pay dividends from net investment income and distributions from net realized capital and currency gains, if any, annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial
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statements. Actual results could differ from those estimates.
2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with Jennison Associates LLC (“Jennison”). The subadvisory agreement provides that Jennison will furnish investment advisory services in connection with the management of the Series. In connection therewith, Jennison is obligated to keep certain books and records of the Series. The Manager pays for the services of Jennison, the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
The management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 0.825% of the Series’on average daily net assets up to $1 billion and 0.800% of such assets in excess of $1 billion. The effective management fee rate before any waivers and/or expense reimbursements was 0.809% for the reporting period ended April 30, 2020.
The Manager has contractually agreed, through February 28, 2021, to limit net annual operating expenses (exclusive of distribution and service (12b-1) fees, shareholder servicing fee, and transfer agency expenses (including sub-transfer agency and networking fees), of each class of shares to 0.84% of the Series’ average daily net assets and to limit transfer agency, shareholder servicing, sub-transfer agency, and blue sky fees, as applicable, to the extent that such fees cause the net Series annual operating expenses to exceed 1.34% of average daily net assets for Class R2 shares or 1.09% of average daily net assets for Class R4 shares. Additionally, the Manager has contractually agreed, through February 28, 2021, to limit annual operating expenses after fee waivers and/or expense reimbursements to 1.08% of average daily net assets for Class A shares. These contractual waivers exclude interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
PGIM Jennison Global Opportunities Fund | 23 |
Notes to Financial Statements (unaudited) (continued)
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class and, in addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver/reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class Z, Class R2, Class R4 and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A, Class C and Class R2 shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z, Class R4 and Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.30%, 1% and 0.25% of the average daily net assets of the Class A, Class C and Class R2 shares, respectively. PIMS has contractually agreed through February 28, 2021 to limit such fees to 0.25% of the average daily net assets of the Class A shares.
The Series has adopted a Shareholder Services Plan with respect to Class R2 and Class R4 shares. Under the terms of the Shareholder Services Plan, Class R2 and Class R4 shares are authorized to pay to Prudential Mutual Fund Services LLC (“PMFS”), its affiliates or third-party service providers, as compensation for services rendered to the shareholders of such Class R2 or Class R4 shares, a shareholder service fee at an annual rate of 0.10% of the average daily net assets attributable to Class R2 and Class R4 shares. The shareholder service fee is accrued daily and paid monthly.
For the reporting period ended April 30, 2020, PIMS received $967,578 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS received $3,262 and $18,471 in contingent deferred sales charges imposed upon redemptions by certain Class A and Class C shareholders, respectively. From these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
PGIM Investments, PIMS, PMFS and Jennison are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
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3. Other Transactions with Affiliates
PMFS serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), and its securities lending cash collateral in the PGIM Institutional Money Market Fund (the “Money Market Fund”), each a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund and Money Market Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income” and “Income from securities lending, net”, respectively.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Fund’s Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $1,638,329,806 and $1,106,032,873, respectively.
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
Value, | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||
$39,563,382 | $ | 787,764,844 | $ | 791,193,075 | $ | — | $ | — | $ | 36,135,151 | 36,135,151 | $ | 384,015 |
PGIM Jennison Global Opportunities Fund | 25 |
Notes to Financial Statements (unaudited) (continued)
Value, | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||
PGIM Institutional Money Market Fund* | ||||||||||||||||||||||||||||
$216,507,339 | $ | 746,310,342 | $ | 744,919,678 | $ | 166,231 | $ | (184,960 | ) | $ | 217,879,274 | 217,922,859 | $ | 364,407 | ** | |||||||||||||
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$256,070,721 | $ | 1,534,075,186 | $ | 1,536,112,753 | $ | 166,231 | $ | (184,960 | ) | $ | 254,014,425 | $ | 748,422 | |||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
** | Represents the affiliated amount of securities lending income shown on the Statement of Operations. |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized appreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 2,887,667,101 | ||
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Gross Unrealized Appreciation | 808,755,633 | |||
Gross Unrealized Depreciation | (45,526,042 | ) | ||
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Net Unrealized Appreciation | $ | 763,229,591 | ||
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The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $55,063,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Series elected to treat certain late-year ordinary income losses of approximately $7,514,000 as having been incurred in the following fiscal year (October 31, 2020).
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class C, Class Z, Class R2, Class R4 and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 5.50%. Investors who purchase
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$1 million or more of Class A shares and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1%, although they are not subject to an initial sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z, Class R2, Class R4 and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, $0.01 par value per share, 950 million of which are designated as shares of the Series. The shares are further classified and designated as follows:
Class A | 50,000,000 | |||
Class C | 70,000,000 | |||
Class Z | 300,000,000 | |||
Class T | 125,000,000 | |||
Class R2 | 75,000,000 | |||
Class R4 | 75,000,000 | |||
Class R6 | 255,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class R2 | 486 | 5 | % | |||||
Class R4 | 486 | 4 | % |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
— | —% | 6 | 76% |
PGIM Jennison Global Opportunities Fund | 27 |
Notes to Financial Statements (unaudited) (continued)
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 2,425,870 | $ | 63,704,233 | |||||
Shares reacquired | (1,419,727 | ) | (36,358,957 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 1,006,143 | 27,345,276 | ||||||
Shares issued upon conversion from other share class(es) | 208,836 | 5,479,979 | ||||||
Shares reacquired upon conversion into other share class(es) | (181,301 | ) | (4,744,921 | ) | ||||
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Net increase (decrease) in shares outstanding | 1,033,678 | $ | 28,080,334 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 3,574,488 | $ | 84,046,392 | |||||
Shares reacquired | (1,608,919 | ) | (37,497,401 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 1,965,569 | 46,548,991 | ||||||
Shares issued upon conversion from other share class(es) | 474,149 | 11,517,082 | ||||||
Shares reacquired upon conversion into other share class(es) | (505,773 | ) | (12,200,682 | ) | ||||
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Net increase (decrease) in shares outstanding | 1,933,945 | $ | 45,865,391 | |||||
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Class C | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 1,565,247 | $ | 38,678,729 | |||||
Shares reacquired | (884,699 | ) | (21,065,107 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 680,548 | 17,613,622 | ||||||
Shares reacquired upon conversion into other share class(es) | (305,165 | ) | (7,524,807 | ) | ||||
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Net increase (decrease) in shares outstanding | 375,383 | $ | 10,088,815 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 2,968,766 | $ | 65,835,812 | |||||
Shares reacquired | (1,453,589 | ) | (31,834,459 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 1,515,177 | 34,001,353 | ||||||
Shares reacquired upon conversion into other share class(es) | (651,781 | ) | (14,977,319 | ) | ||||
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Net increase (decrease) in shares outstanding | 863,396 | $ | 19,024,034 | |||||
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Class Z | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 26,863,493 | $ | 697,938,393 | |||||
Shares reacquired | (12,988,347 | ) | (334,619,020 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 13,875,146 | 363,319,373 | ||||||
Shares issued upon conversion from other share class(es) | 389,160 | 10,367,617 | ||||||
Shares reacquired upon conversion into other share class(es) | (156,694 | ) | (4,167,246 | ) | ||||
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Net increase (decrease) in shares outstanding | 14,107,612 | $ | 369,519,744 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 34,742,508 | $ | 829,611,273 | |||||
Shares reacquired | (19,222,576 | ) | (449,656,211 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | 15,519,932 | 379,955,062 | ||||||
Shares issued upon conversion from other share class(es) | 823,877 | 20,194,422 | ||||||
Shares reacquired upon conversion into other share class(es) | (211,940 | ) | (5,148,266 | ) | ||||
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Net increase (decrease) in shares outstanding | 16,131,869 | $ | 395,001,218 | |||||
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Class R2 | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 8,617 | $ | 261,387 | |||||
Shares reacquired | (9 | ) | (198 | ) | ||||
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Net increase (decrease) in shares outstanding | 8,608 | $ | 261,189 | |||||
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Period ended October 31, 2019*: | ||||||||
Shares sold | 1,288 | $ | 30,000 | |||||
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Net increase (decrease) in shares outstanding before conversion | 1,288 | 30,000 | ||||||
Shares reacquired upon conversion into other share class(es) | (802 | ) | (19,896 | ) | ||||
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Net increase (decrease) in shares outstanding | 486 | $ | 10,104 | |||||
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Class R4 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 603 | $ | 15,408 | |||||
Shares reacquired | (1,260 | ) | (35,286 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (657 | ) | $ | (19,878 | ) | |||
|
|
|
| |||||
Period ended October 31, 2019*: | ||||||||
Shares sold | 15,428 | $ | 381,279 | |||||
Shares reacquired | — | ** | (4 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 15,428 | 381,275 | ||||||
Shares reacquired upon conversion into other share class(es) | (992 | ) | (24,682 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 14,436 | $ | 356,593 | |||||
|
|
|
| |||||
Class R6 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 8,782,210 | $ | 233,152,429 | |||||
Shares reacquired | (3,077,699 | ) | (82,558,799 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 5,704,511 | 150,593,630 | ||||||
Shares issued upon conversion from other share class(es) | 22,487 | 594,330 | ||||||
Shares reacquired upon conversion into other share class(es) | (162 | ) | (4,952 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 5,726,836 | $ | 151,183,008 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 16,578,431 | $ | 402,296,418 | |||||
Shares reacquired | (2,630,526 | ) | (63,683,876 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 13,947,905 | 338,612,542 | ||||||
Shares issued upon conversion from other share class(es) | 26,917 | 659,341 | ||||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 13,974,822 | $ | 339,271,883 | |||||
|
|
|
|
* | Commencement of offering was December 27, 2018. |
** | Less than 1 share. |
7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
PGIM Jennison Global Opportunities Fund | 29 |
Notes to Financial Statements (unaudited) (continued)
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $ 1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent |
* | Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series did not utilize the SCA during the reporting period ended April 30, 2020.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Equity and Equity-Related Securities Risks: The value of a particular security could go down and you could lose money. In addition to an individual security losing value, the value of the equity markets or a sector in which the Series invests could go down. The Series’ holdings can vary significantly from broad market indexes and the performance of the Series can deviate from the performance of these indexes. Different parts of a market can react differently to adverse issuer, market, regulatory, political and economic developments.
30 |
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019,
PGIM Jennison Global Opportunities Fund | 31 |
Notes to Financial Statements (unaudited) (continued)
and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
32 |
Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
| |||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $24.58 | $21.47 | $20.72 | $15.14 | $15.63 | $14.08 | ||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||
Net investment income (loss) | (0.07 | ) | (0.11 | ) | (0.13 | ) | (0.09 | ) | (0.05 | ) | (0.09 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.84 | 3.22 | 0.88 | 5.67 | (0.44 | ) | 1.64 | |||||||||||||||||||||
Total from investment operations | 2.77 | 3.11 | 0.75 | 5.58 | (0.49 | ) | 1.55 | |||||||||||||||||||||
Net asset value, end of period | $27.35 | $24.58 | $21.47 | $20.72 | $15.14 | $15.63 | ||||||||||||||||||||||
Total Return(b): | 11.27% | 14.49% | 3.62% | 36.86% | (3.13)% | 11.01% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $291,047 | $236,118 | $164,764 | $90,247 | $89,579 | $74,049 | ||||||||||||||||||||||
Average net assets (000) | $263,861 | $205,653 | $142,313 | $70,810 | $100,220 | $36,635 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.08% | (e) | 1.08% | 1.14% | 1.19% | 1.20% | 1.38% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.24% | (e) | 1.28% | 1.30% | 1.33% | 1.36% | 1.56% | |||||||||||||||||||||
Net investment income (loss) | (0.56)% | (e) | (0.45)% | (0.55)% | (0.55)% | (0.31)% | (0.63)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 38% | 52% | 62% | 79% | 88% | 58% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 33 |
Financial Highlights (unaudited)(continued)
Class C Shares | ||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
| |||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $23.16 | $20.41 | $19.85 | $14.61 | $15.20 | $13.79 | ||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||
Net investment income (loss) | (0.17 | ) | (0.29 | ) | (0.30 | ) | (0.22 | ) | (0.15 | ) | (0.20 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.68 | 3.04 | 0.86 | 5.46 | (0.44 | ) | 1.61 | |||||||||||||||||||||
Total from investment operations | 2.51 | 2.75 | 0.56 | 5.24 | (0.59 | ) | 1.41 | |||||||||||||||||||||
Net asset value, end of period | $25.67 | $23.16 | $20.41 | $19.85 | $14.61 | $15.20 | ||||||||||||||||||||||
Total Return(b): | 10.84% | 13.47% | 2.82% | 35.87% | (3.88)% | 10.22% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $243,783 | $211,290 | $168,587 | $79,531 | $52,246 | $28,982 | ||||||||||||||||||||||
Average net assets (000) | $229,761 | $198,518 | $136,788 | $55,922 | $50,113 | $11,330 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.93% | (e) | 1.94% | 1.94% | 1.94% | 1.95% | 2.12% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.94% | (e) | 1.97% | 1.99% | 2.03% | 2.06% | 2.27% | |||||||||||||||||||||
Net investment income (loss) | (1.42)% | (e) | (1.31)% | (1.35)% | (1.28)% | (1.07)% | (1.37)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 38% | 52% | 62% | 79% | 88% | 58% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
34 |
Class Z Shares | ||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
| |||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $25.01 | $21.82 | $21.00 | $15.31 | $15.77 | $14.17 | ||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||
Net investment income (loss) | (0.05 | ) | (0.07 | ) | (0.08 | ) | (0.05 | ) | (0.01 | ) | (0.06 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.90 | 3.26 | 0.90 | 5.74 | (0.45 | ) | 1.66 | |||||||||||||||||||||
Total from investment operations | 2.85 | 3.19 | 0.82 | 5.69 | (0.46 | ) | 1.60 | |||||||||||||||||||||
Net asset value, end of period | $27.86 | $25.01 | $21.82 | $21.00 | $15.31 | $15.77 | ||||||||||||||||||||||
Total Return(b): | 11.40% | 14.62% | 3.90% | 37.17% | (2.92)% | 11.29% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $2,026,420 | $1,466,571 | $927,492 | $334,783 | $114,228 | $102,800 | ||||||||||||||||||||||
Average net assets (000) | $1,676,296 | $1,228,375 | $693,749 | $193,977 | $131,042 | $48,494 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.92% | (e) | 0.94% | 0.93% | 0.94% | 0.95% | 1.15% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 0.92% | (e) | 0.96% | 0.97% | 1.02% | 1.06% | 1.28% | |||||||||||||||||||||
Net investment income (loss) | (0.40)% | (e) | (0.31)% | (0.35)% | (0.28)% | (0.07)% | (0.41)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 38% | 52% | 62% | 79% | 88% | 58% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 35 |
Financial Highlights (unaudited)(continued)
Class R2 Shares | ||||||||||||
Six Months Ended April 30, 2020 | December 27, 2018(a) through October 31, 2019 | |||||||||||
Per Share Operating Performance(b): |
| |||||||||||
Net Asset Value, Beginning of Period | $25.02 | $20.59 | ||||||||||
Income (loss) from investment operations: |
| |||||||||||
Net investment income (loss) | (0.06 | ) | (0.12 | ) | ||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.86 | 4.55 | ||||||||||
Total from investment operations | 2.80 | 4.43 | ||||||||||
Net asset value, end of period | $27.82 | $25.02 | ||||||||||
Total Return(c): | 11.19% | 21.52% | ||||||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets, end of period (000) | $253 | $12 | ||||||||||
Average net assets (000) | $100 | $13 | ||||||||||
Ratios to average net assets(d): | ||||||||||||
Expenses after waivers and/or expense reimbursement | 1.14% | (e) | 1.34% | (e) | ||||||||
Expenses before waivers and/or expense reimbursement | 17.33% | (e) | 216.05% | (e) | ||||||||
Net investment income (loss) | (0.44)% | (e) | (0.58)% | (e) | ||||||||
Portfolio turnover rate(f) | 38% | 52% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
36 |
Class R4 Shares | ||||||||||||
Six Months Ended April 30, 2020 | December 27, 2018(a) through October 31, 2019 | |||||||||||
Per Share Operating Performance(b): |
| |||||||||||
Net Asset Value, Beginning of Period | $25.08 | $20.59 | ||||||||||
Income (loss) from investment operations: |
| |||||||||||
Net investment income (loss) | (0.06 | ) | (0.10 | ) | ||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.90 | 4.59 | ||||||||||
Total from investment operations | 2.84 | 4.49 | ||||||||||
Net asset value, end of period | $27.92 | $25.08 | ||||||||||
Total Return(c): | 11.32% | 21.81% | ||||||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets, end of period (000) | $385 | $362 | ||||||||||
Average net assets (000) | $371 | $122 | ||||||||||
Ratios to average net assets(d): | ||||||||||||
Expenses after waivers and/or expense reimbursement | 0.96% | (e) | 0.97% | (e) | ||||||||
Expenses before waivers and/or expense reimbursement | 5.39% | (e) | 23.67% | (e) | ||||||||
Net investment income (loss) | (0.44)% | (e) | (0.46)% | (e) | ||||||||
Portfolio turnover rate(f) | 38% | 52% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Global Opportunities Fund | 37 |
Financial Highlights (unaudited)(continued)
Class R6 Shares | ||||||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | December 22, 2014(a) through October 31, | ||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||||||
Per Share Operating Performance(b): |
| |||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $25.13 | $21.90 | $21.06 | $15.33 | $15.78 | $14.15 | ||||||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||||||
Net investment income (loss) | (0.04 | ) | (0.06 | ) | (0.06 | ) | (0.04 | ) | 0.01 | (0.03 | ) | |||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 2.91 | 3.29 | 0.90 | 5.77 | (0.46 | ) | 1.66 | |||||||||||||||||||||||||
Total from investment operations | 2.87 | 3.23 | 0.84 | 5.73 | (0.45 | ) | 1.63 | |||||||||||||||||||||||||
Net asset value, end of period | $28.00 | $25.13 | $21.90 | $21.06 | $15.33 | $15.78 | ||||||||||||||||||||||||||
Total Return(c): | 11.42% | 14.75% | 3.99% | 37.38% | (2.85)% | 11.52% | ||||||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||||||
Net assets, end of period (000) | $875,022 | $641,419 | $253,010 | $29,023 | $8,647 | $11 | ||||||||||||||||||||||||||
Average net assets (000) | $744,087 | $448,178 | $133,984 | $14,700 | $7,736 | $11 | ||||||||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.84% | (f) | 0.84% | 0.84% | 0.84% | 0.84% | 1.09% | (f) | ||||||||||||||||||||||||
Expenses before waivers and/or | ||||||||||||||||||||||||||||||||
expense reimbursement | 0.84% | (f) | 0.87% | 0.90% | 0.92% | 0.95% | 1.18% | (f) | ||||||||||||||||||||||||
Net investment income (loss) | (0.32)% | (f) | (0.23)% | (0.26)% | (0.23)% | 0.05% | (0.27)% | (f) | ||||||||||||||||||||||||
Portfolio turnover rate(g) | 38% | 52% | 62% | 79% | 88% | 58% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
38 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Jennison Global Opportunities Fund | 39 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | Jennison Associates LLC | 466 Lexington Avenue New York, NY 10017 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street New York, NY 10286 | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue New York, NY 10017 | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Jennison Global Opportunities Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM JENNISON GLOBAL OPPORTUNITIES FUND
SHARE CLASS | A | C | Z | R2 | R4 | R6 | ||||||
NASDAQ | PRJAX | PRJCX | PRJZX | PRJBX | PRJDX | PRJQX | ||||||
CUSIP | 743969719 | 743969693 | 743969685 | 743969438 | 743969420 | 743969594 |
MF214E2
PGIM JENNISON INTERNATIONAL OPPORTUNITIES FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
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4 | ||||
7 | ||||
9 |
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC, member SIPC. Jennison Associates LLC is a registered investment adviser. Both are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, PGIM, and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
2 | Visit our website at pgiminvestments.com |
Dear Shareholder:
We hope you find the semiannual report for PGIM Jennison International Opportunities Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to
maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Jennison International Opportunities Fund
June 15, 2020
PGIM Jennison International Opportunities Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
(without sales charges) | Average Annual Total Returns as of 4/30/20 (with sales charges) | |||||||||||||
Six Months* (%) | One Year (%) | Five Years (%) | Since Inception (%) | |||||||||||
Class A | 3.89 | 2.16 | 6.68 | 9.13 (6/5/12) | ||||||||||
Class C | 3.52 | 6.19 | 7.05 | 9.08 (6/5/12) | ||||||||||
Class R | 3.69 | 7.67 | N/A | 5.77 (11/20/17) | ||||||||||
Class Z | 4.00 | 8.27 | 8.14 | 10.17 (6/5/12) | ||||||||||
Class R2 | 3.86 | 7.91 | N/A | 25.35 (12/27/18) | ||||||||||
Class R4 | 3.95 | 8.17 | N/A | 25.67 (12/27/18) | ||||||||||
Class R6 | 4.04 | 8.32 | N/A | 10.80 (12/23/15) | ||||||||||
MSCI ACWI ex-US Index |
| |||||||||||||
–13.22 | –11.51 | –0.17 | — | |||||||||||
Average Annual Total Returns as of 4/30/20 Since Inception (%) | ||||||||||||||
Class A, C, Z (6/5/12) | Class R (11/20/17) | Class R2, R4 (12/27/18) | Class R6 (12/23/15) | |||||||||||
MSCI ACWI ex-US Index | 4.70 | –5.20 | 0.14 | 3.12 |
*Not annualized
Source: PGIM Investments LLC and Lipper Inc.
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to each class’ inception date.
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The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class R | Class Z | Class R2 | Class R4 | Class R6 | ||||||||
Maximum initial sales charge | 5.50% of the public offering price | None | None | None | None | None | None | |||||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 1.00% on sales made within 12 months of purchase | None | None | None | None | None | |||||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% (0.25% currently) | 1.00% | 0.75% (0.50% currently) | None | 0.25% | None | None | |||||||
Shareholder services fees | None | None | None | None | 0.10% | 0.10% | None |
Benchmark Definitions
MSCI All Country World Index ex-US Index—The Morgan Stanley Capital International All Country World ex-US Index (MSCI ACWI ex-US Index) is an unmanaged free float-adjusted market capitalization-weighted index that is designed to provide a broad measure of stock performance throughout the world, with the exception of US-based companies. The Index includes both developed and emerging markets.
PGIM Jennison International Opportunities Fund | 5 |
Your Fund’s Performance (continued)
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
Presentation of Fund Holdings as of 4/30/20
Ten Largest Holdings | Line of Business | Country | % of Net Assets | |||
Alibaba Group Holding Ltd., ADR | Internet & Direct Marketing Retail | China | 5.3% | |||
Adyen NV, 144A | IT Services | Netherlands | 5.2% | |||
Shopify, Inc. (Class A Stock) | IT Services | Canada | 5.0% | |||
Sartorius AG (PRFC) | Health Care Equipment & Supplies | Germany | 4.3% | |||
Wuxi Biologics Cayman, Inc., 144A | Life Sciences Tools & Services | China | 3.9% | |||
Tencent Holdings Ltd. | Interactive Media & Services | China | 3.8% | |||
Ferrari NV | Automobiles | Italy | 3.7% | |||
L’Oreal SA | Personal Products | France | 3.7% | |||
LVMH Moet Hennessy Louis Vuitton SE | Textiles, Apparel & Luxury Goods | France | 3.6% | |||
Givaudan SA | Chemicals | Switzerland | 3.3% |
Holdings reflect only long-term investments and are subject to change.
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As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
PGIM Jennison International Opportunities Fund | 7 |
Fees and Expenses (continued)
and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Jennison International Opportunities Fund | Beginning Account Value November 1, 2019 | Ending Account April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 1,038.90 | 1.09 | % | $ | 5.53 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.44 | 1.09 | % | $ | 5.47 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 1,035.20 | 1.90 | % | $ | 9.61 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,015.42 | 1.90 | % | $ | 9.52 | ||||||||||
Class R | Actual | $ | 1,000.00 | $ | 1,036.90 | 1.47 | % | $ | 7.44 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,017.55 | 1.47 | % | $ | 7.37 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 1,040.00 | 0.90 | % | $ | 4.56 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.39 | 0.90 | % | $ | 4.52 | ||||||||||
Class R2 | Actual | $ | 1,000.00 | $ | 1,038.60 | 1.19 | % | $ | 6.03 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,018.95 | 1.19 | % | $ | 5.97 | ||||||||||
Class R4 | Actual | $ | 1,000.00 | $ | 1,039.50 | 0.97 | % | $ | 4.92 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.04 | 0.97 | % | $ | 4.87 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 1,040.40 | 0.84 | % | $ | 4.26 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,020.69 | 0.84 | % | $ | 4.22 |
* Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
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Schedule of Investments (unaudited)
as of April 30, 2020
Description | Shares | Value | ||||||
LONG-TERM INVESTMENTS 97.1% | ||||||||
COMMON STOCKS 92.8% | ||||||||
Argentina 2.8% | ||||||||
MercadoLibre, Inc.* | 49,849 | $ | 29,087,390 | |||||
Australia 1.7% | ||||||||
Cochlear Ltd. | 148,018 | 17,690,911 | ||||||
Canada 5.0% | ||||||||
Shopify, Inc. (Class A Stock)* | 81,396 | 51,465,877 | ||||||
China 20.0% | ||||||||
Alibaba Group Holding Ltd., ADR* | 265,796 | 53,868,875 | ||||||
Jiangsu Hengrui Medicine Co. Ltd. (Class A Stock)* | 1,682,842 | 22,000,873 | ||||||
Kweichow Moutai Co. Ltd. (Class A Stock) | 109,721 | 19,490,854 | ||||||
Meituan Dianping (Class B Stock)* | 2,268,588 | 30,257,380 | ||||||
Tencent Holdings Ltd. | 725,932 | 38,420,035 | ||||||
Wuxi Biologics Cayman, Inc., 144A* | 2,561,233 | 39,715,639 | ||||||
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| |||||||
203,753,656 | ||||||||
Denmark 1.7% | ||||||||
Novo Nordisk A/S (Class B Stock) | 267,239 | 17,026,527 | ||||||
France 15.5% | ||||||||
Dassault Systemes SE | 185,317 | 27,159,730 | ||||||
Kering SA | 43,039 | 21,938,426 | ||||||
L’Oreal SA* | 129,168 | 37,730,440 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 94,620 | 36,884,269 | ||||||
Pernod Ricard SA | 166,917 | 25,424,611 | ||||||
Remy Cointreau SA(a) | 80,645 | 8,996,139 | ||||||
|
| |||||||
158,133,615 | ||||||||
Hong Kong 2.3% | ||||||||
AIA Group Ltd. | 2,553,576 | 23,616,251 | ||||||
Israel 1.9% | ||||||||
Nice Ltd., ADR*(a) | 116,166 | 19,086,074 | ||||||
Italy 6.0% | ||||||||
Brunello Cucinelli SpA | 715,825 | 23,144,501 | ||||||
Ferrari NV | 241,016 | 37,931,410 | ||||||
|
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61,075,911 |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Japan 4.4% | ||||||||
Freee KK*(a) | 323,693 | $ | 11,403,638 | |||||
GMO Payment Gateway, Inc. | 196,531 | 17,558,669 | ||||||
Menicon Co. Ltd. | 375,521 | 16,345,321 | ||||||
|
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45,307,628 | ||||||||
Netherlands 6.8% | ||||||||
Adyen NV, 144A* | 54,222 | 53,241,328 | ||||||
ASML Holding NV | 53,658 | 15,708,901 | ||||||
|
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68,950,229 | ||||||||
Switzerland 9.2% | ||||||||
Alcon, Inc.* | 468,517 | 24,658,058 | ||||||
Givaudan SA | 10,125 | 33,979,778 | ||||||
Novartis AG | 138,126 | 11,758,091 | ||||||
Roche Holding AG | 66,720 | 23,234,182 | ||||||
|
| |||||||
93,630,109 | ||||||||
Taiwan 4.2% | ||||||||
Sea Ltd., ADR*(a) | 496,220 | 27,579,908 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd., ADR | 282,049 | 14,985,263 | ||||||
|
| |||||||
42,565,171 | ||||||||
United Kingdom 5.4% | ||||||||
AstraZeneca PLC | 245,145 | 25,584,419 | ||||||
Experian PLC | 978,107 | 29,152,757 | ||||||
|
| |||||||
54,737,176 | ||||||||
United States 5.9% | ||||||||
Atlassian Corp. PLC (Class A Stock)* | 199,446 | 31,011,858 | ||||||
Lululemon Athletica, Inc.*(a) | 131,241 | 29,329,739 | ||||||
|
| |||||||
60,341,597 | ||||||||
|
| |||||||
TOTAL COMMON STOCKS | 946,468,122 | |||||||
|
|
See Notes to Financial Statements.
10 |
Description | Shares | Value | ||||||
PREFERRED STOCK 4.3% | ||||||||
Germany | ||||||||
Sartorius AG (PRFC) | 158,396 | $ | 44,587,867 | |||||
|
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TOTAL LONG-TERM INVESTMENTS | 991,055,989 | |||||||
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SHORT-TERM INVESTMENTS 8.8% | ||||||||
AFFILIATED MUTUAL FUNDS | ||||||||
PGIM Core Ultra Short Bond Fund(w) | 43,136,246 | 43,136,246 | ||||||
PGIM Institutional Money Market Fund | 46,327,131 | 46,317,866 | ||||||
|
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TOTAL SHORT-TERM INVESTMENTS | 89,454,112 | |||||||
|
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TOTAL INVESTMENTS 105.9% | 1,080,510,101 | |||||||
Liabilities in excess of other assets (5.9)% | (60,511,817 | ) | ||||||
|
| |||||||
NET ASSETS 100.0% | $ | 1,019,998,284 | ||||||
|
|
Below is a list of the abbreviation(s) used in the semiannual report:
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
ADR—American Depositary Receipt
LIBOR—London Interbank Offered Rate
PRFC—Preference Shares
* | Non-income producing security. |
(a) | All or a portion of security is on loan. The aggregate market value of such securities, including those sold and pending settlement, is $44,476,265; cash collateral of $46,192,172 (included in liabilities) was received with which the Series purchased highly liquid short-term investments. |
(b) | Represents security, or portion thereof, purchased with cash collateral received for securities on loan and includes dividend reinvestment. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund and PGIM Institutional Money Market Fund. |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Common Stocks | ||||||||||||
Argentina | $ | 29,087,390 | $ | — | $ | — | ||||||
Australia | — | 17,690,911 | — | |||||||||
Canada | 51,465,877 | — | — | |||||||||
China | 53,868,875 | 149,884,781 | — | |||||||||
Denmark | — | 17,026,527 | — | |||||||||
France | — | 158,133,615 | — | |||||||||
Hong Kong | — | 23,616,251 | — | |||||||||
Israel | 19,086,074 | — | — | |||||||||
Italy | — | 61,075,911 | — | |||||||||
Japan | — | 45,307,628 | — | |||||||||
Netherlands | — | 68,950,229 | — | |||||||||
Switzerland | — | 93,630,109 | — | |||||||||
Taiwan | 42,565,171 | — | — | |||||||||
United Kingdom | — | 54,737,176 | — | |||||||||
United States | 60,341,597 | — | — | |||||||||
Preferred Stock | ||||||||||||
Germany | — | 44,587,867 | — | |||||||||
Affiliated Mutual Funds | 89,454,112 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | 345,869,096 | $ | 734,641,005 | $ | — | ||||||
|
|
|
|
|
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Industry Classification:
The industry classification of investments and liabilities in excess of other assets shown as a percentage of net assets as of April 30, 2020 were as follows:
IT Services | 11.9 | % | ||
Internet & Direct Marketing Retail | 11.1 | |||
Textiles, Apparel & Luxury Goods | 10.9 | |||
Health Care Equipment & Supplies | 10.0 | |||
Pharmaceuticals | 9.8 | |||
Affiliated Mutual Funds (4.5% represents investments purchased with collateral from securities on loan) | 8.8 | |||
Software | 8.7 | |||
Beverages | 5.3 | |||
Life Sciences Tools & Services | 3.9 | |||
Interactive Media & Services | 3.8 | |||
Automobiles | 3.7 | |||
Personal Products | 3.7 | % | ||
Chemicals | 3.3 | |||
Semiconductors & Semiconductor Equipment | 3.1 | |||
Professional Services | 2.9 | |||
Entertainment | 2.7 | |||
Insurance | 2.3 | |||
|
| |||
105.9 | ||||
Liabilities in excess of other assets | (5.9 | ) | ||
|
| |||
100.0 | % | |||
|
|
See Notes to Financial Statements.
12 |
Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series entered into financial instruments/transactions during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for financial instruments/transactions where the legal right to set-off exists is presented in the summary below.
Offsetting of financial instrument/transaction assets and liabilities:
Description | Gross Market Value of Recognized Assets/(Liabilities) | Collateral Pledged/(Received)(1) | Net Amount | |||||||||
Securities on Loan | $ | 44,476,265 | $ | (44,476,265 | ) | $ | — | |||||
|
|
(1) | Collateral amount disclosed by the Series is limited to the market value of financial instruments/transactions. |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 13 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value, including securities on loan of $44,476,265: | ||||
Unaffiliated investments (cost $823,228,620) | $ | 991,055,989 | ||
Affiliated investments (cost $89,373,169) | 89,454,112 | |||
Foreign currency, at value (cost $337,522) | 337,522 | |||
Receivable for Series shares sold | 20,166,983 | |||
Tax reclaim receivable | 1,371,456 | |||
Dividends and interest receivable | 382,107 | |||
Receivable for investments sold | 11,005 | |||
Prepaid expenses | 1,251 | |||
|
| |||
Total Assets | 1,102,780,425 | |||
|
| |||
Liabilities | ||||
Payable to broker for collateral for securities on loan | 46,192,172 | |||
Payable for investments purchased | 20,730,454 | |||
Payable for Series shares reacquired | 15,018,301 | |||
Management fee payable | 541,600 | |||
Accrued expenses and other liabilities | 129,431 | |||
Distribution fee payable | 110,973 | |||
Affiliated transfer agent fee payable | 59,192 | |||
Affiliated shareholder servicing fees payable | 18 | |||
|
| |||
Total Liabilities | 82,782,141 | |||
|
| |||
Net Assets | $ | 1,019,998,284 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 498,758 | ||
Paid-in capital in excess of par | 908,664,723 | |||
Total distributable earnings (loss) | 110,834,803 | |||
|
| |||
Net assets, April 30, 2020 | $ | 1,019,998,284 | ||
|
|
See Notes to Financial Statements.
14 |
Class A | ||||
Net asset value and redemption price per share, | $ | 20.27 | ||
Maximum sales charge (5.50% of offering price) | 1.18 | |||
|
| |||
Maximum offering price to public | $ | 21.45 | ||
|
| |||
Class C | ||||
Net asset value, offering price and redemption price per share, | $ | 19.08 | ||
|
| |||
Class R | ||||
Net asset value, offering price and redemption price per share, | $ | 20.20 | ||
|
| |||
Class Z | ||||
Net asset value, offering price and redemption price per share, | $ | 20.56 | ||
|
| |||
Class R2 | ||||
Net asset value, offering price and redemption price per share, | $ | 20.45 | ||
|
| |||
Class R4 | ||||
Net asset value, offering price and redemption price per share, | $ | 20.53 | ||
|
| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | $ | 20.58 | ||
|
|
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 15 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Unaffiliated dividend income (net of $440,324 foreign withholding tax) | $ | 2,745,838 | ||
Affiliated dividend income | 155,404 | |||
Income from securities lending, net (including affiliated income of $75,640) | 101,063 | |||
|
| |||
Total income | 3,002,305 | |||
|
| |||
Expenses | ||||
Management fee | 3,163,247 | |||
Distribution fee(a) | 1,103,609 | |||
Shareholder servicing fees (including affiliated expense of $112)(a) | 493 | |||
Transfer agent’s fees and expenses (including affiliated expense of $188,059)(a) | 298,616 | |||
Custodian and accounting fees | 143,901 | |||
Registration fees(a) | 72,714 | |||
Shareholders’ reports | 32,658 | |||
SEC registration fees | 22,610 | |||
Audit fee | 13,557 | |||
Directors’ fees | 12,538 | |||
Legal fees and expenses | 9,655 | |||
Miscellaneous | 16,570 | |||
|
| |||
Total expenses | 4,890,168 | |||
Less: Fee waiver and/or expense reimbursement(a) | (296,372 | ) | ||
Distribution fee waiver(a) | (347,492 | ) | ||
|
| |||
Net expenses | 4,246,304 | |||
|
| |||
Net investment income (loss) | (1,243,999 | ) | ||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions (including affiliated of $(25,414)) | (20,847,613 | ) | ||
Foreign currency transactions | (91,688 | ) | ||
|
| |||
(20,939,301 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments (including affiliated of $79,812) | 48,416,494 | |||
Foreign currencies | 23,296 | |||
|
| |||
48,439,790 | ||||
|
| |||
Net gain (loss) on investment and foreign currency transactions | 27,500,489 | |||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | 26,256,490 | ||
|
|
See Notes to Financial Statements.
16 |
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class R | Class Z | Class R2 | Class R4 | Class R6 | ||||||||||||||||||||||
Distribution fee | 49,105 | 36,276 | 1,017,925 | — | 303 | — | — | |||||||||||||||||||||
Shareholder servicing fees | — | — | — | — | 65 | 428 | — | |||||||||||||||||||||
Transfer agent’s fees and expenses | 18,613 | 3,113 | 180,340 | 95,665 | 78 | 446 | 361 | |||||||||||||||||||||
Registration fees | 7,360 | 6,942 | 7,631 | 17,683 | 8,618 | 8,618 | 15,862 | |||||||||||||||||||||
Fee waiver and/or expense reimbursement | (34,272 | ) | (9,701 | ) | (82,788 | ) | (97,856 | ) | (8,707 | ) | (9,169 | ) | (53,879 | ) | ||||||||||||||
Distribution fee waiver | (8,184 | ) | — | (339,308 | ) | — | — | — | — |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 17 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | (1,243,999) | $ | (727,376) | ||||
Net realized gain (loss) on investment and foreign currency transactions | (20,939,301 | ) | (18,527,930 | ) | ||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | 48,439,790 | 124,133,290 | ||||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | 26,256,490 | 104,877,984 | ||||||
|
|
|
| |||||
Dividends and Distributions | ||||||||
Distributions from distributable earnings | ||||||||
Class Z | — | (60,708 | ) | |||||
Class R6 | — | (50,751 | ) | |||||
|
|
|
| |||||
— | (111,459 | ) | ||||||
|
|
|
| |||||
Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 509,879,958 | 276,400,116 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | — | 111,341 | ||||||
Cost of shares reacquired | (140,212,061 | ) | (181,047,151 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | 369,667,897 | 95,464,306 | ||||||
|
|
|
| |||||
Total increase (decrease) | 395,924,387 | 200,230,831 | ||||||
Net Assets: | ||||||||
Beginning of period | 624,073,897 | 423,843,066 | ||||||
|
|
|
| |||||
End of period | $ | 1,019,998,284 | $ | 624,073,897 | ||||
|
|
|
|
See Notes to Financial Statements.
18 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act and may invest a greater percentage of their assets in the securities of a single company or other issuer than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund. These financial statements relate only to the PGIM Jennison International Opportunities Fund (the “Series”).
The investment objective of the Series is to seek long-term growth of capital.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services—Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund’s Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur
PGIM Jennison International Opportunities Fund | 19 |
Notes to Financial Statements (unaudited) (continued)
when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Common and preferred stocks, exchange-traded funds, and derivative instruments, such as futures or options, that are traded on a national securities exchange are valued at the last sale price as of the close of trading on the applicable exchange where the security principally trades. Securities traded via NASDAQ are valued at the NASDAQ official closing price. To the extent these securities are valued at the last sale price or NASDAQ official closing price, they are classified as Level 1 in the fair value hierarchy. In the event that no sale or official closing price on valuation date exists, these securities are generally valued at the mean between the last reported bid and ask prices, or at the last bid price in the absence of an ask price. These securities are classified as Level 2 in the fair value hierarchy.
Foreign equities traded on foreign securities exchanges are generally valued using pricing vendor services that provide model prices derived using adjustment factors based on information such as local closing price, relevant general and sector indices, currency fluctuations, depositary receipts, and futures, as applicable. Securities valued using such model prices are classified as Level 2 in the fair value hierarchy. The models generate an evaluated adjustment factor for each security, which is applied to the local closing price to adjust it for post closing market movements up to the time the Series is valued. Utilizing that evaluated adjustment factor, the vendor provides an evaluated price for each security. If the vendor does not provide an evaluated price, securities are valued in accordance with exchange-traded common and preferred stock valuation policies discussed above.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
20 |
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally isolate that portion of
PGIM Jennison International Opportunities Fund | 21 |
Notes to Financial Statements (unaudited) (continued)
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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions.
Net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Master Netting Arrangements: The Fund, on behalf of the Series, is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
Securities Lending: The Series lends its portfolio securities to banks and broker-dealers. The loans are secured by collateral at least equal to the market value of the securities loaned. Collateral pledged by each borrower is invested in an affiliated money market fund and is marked to market daily, based on the previous day’s market value, such that the value of the collateral exceeds the value of the loaned securities. In the event of significant appreciation in value of securities on loan on the last business day of the reporting period, the financial statements may reflect a collateral value that is less than the market value of the loaned securities. Such shortfall is remedied as described above. Loans are subject to termination at the option of the borrower or the Series. Upon termination of the loan, the borrower will return to the Series securities identical to the loaned securities. Should the borrower of the
22 |
securities fail financially, the Series has the right to repurchase the securities in the open market using the collateral.
The Series recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The borrower receives all interest and dividends from the securities loaned and such payments are passed back to the lender in amounts equivalent thereto. The Series also continues to recognize any unrealized gain (loss) in the market price of the securities loaned and on the change in the value of the collateral invested that may occur during the term of the loan. In addition, realized gain (loss) is recognized on changes in the value of the collateral invested upon liquidation of the collateral. Net earnings from securities lending are disclosed in the Statement of Operations.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to pay dividends from net investment income and distributions from net realized capital and currency gains, if any, annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
PGIM Jennison International Opportunities Fund | 23 |
Notes to Financial Statements (unaudited) (continued)
2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with Jennison Associates LLC (“Jennison”). The subadvisory agreement provides that Jennison will furnish investment advisory services in connection with the management of the Series. In connection therewith, Jennison is obligated to keep certain books and records of the Series. The Manager pays for the services of Jennison, the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
The management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 0.825% of the Series’ average daily net assets up to and including $1 billion and 0.800% of such assets in excess of $1 billion. The effective management fee rate before any waivers and/or expense reimbursements was 0.825% for the reporting period ended April 30, 2020.
The Manager has contractually agreed, through February 28, 2021, to reimburse and/or waive fees so that the Series’ net annual operating expenses of each share class does not exceed 0.84% of the Series’ average daily net assets (exclusive of distribution and service (12b-1) fees, shareholder servicing fee, and transfer agency expenses (including sub-transfer agency and networking fees)) and to limit transfer agency, shareholder servicing, sub-transfer agency, and blue sky fees, as applicable, to the extent that such fees cause the net annual operating expenses to exceed 1.34% of average daily net assets for Class R2 shares or 1.09% of average daily net assets for Class R4 shares. Additionally, the Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.09% of average daily net assets for Class A shares. Separately, the Manager has contractually agreed to waive and/or reimburse up to 0.06% of certain other expenses on an annualized basis,
24 |
through February 28, 2021, to the extent that the total net annual operating expenses exceed 1.90% of average daily net assets for Class C shares, 1.48% of average daily net assets for Class R shares, 0.90% of average daily net assets for Class Z shares and 0.84% of average daily net assets for Class R6 shares. The contractual waivers and expense limitation above exclude interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class. In addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver and/or reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for the fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class R, Class Z, Class R2, Class R4 and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A, Class C, Class R and Class R2 shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z, Class R4 and Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.30%, 1%, 0.75% and 0.25% of the average daily net assets of the Class A, Class C, Class R and Class R2 shares, respectively. PIMS has contractually agreed through February 28, 2021 to limit such fees to 0.25% and 0.50% of the average daily net assets of the Class A and Class R shares, respectively.
The Series has adopted a Shareholder Services Plan with respect to Class R2 and Class R4 shares. Under the terms of the Shareholder Services Plan, Class R2 and Class R4 shares are authorized to pay to Prudential Mutual Fund Services LLC (“PMFS”), its affiliates or third-party service providers, as compensation for services rendered to the shareholders of such Class R2 or Class R4 shares, a shareholder service fee at an annual rate of 0.10% of the average daily net assets attributable to Class R2 and Class R4 shares. The shareholder service fee is accrued daily and paid monthly.
For the reporting period ended April 30, 2020, PIMS received $177,429 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS received $525 and $221 in contingent deferred sales charges imposed upon redemptions by certain Class A and Class C shareholders, respectively. From
PGIM Jennison International Opportunities Fund | 25 |
Notes to Financial Statements (unaudited) (continued)
these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
PGIM Investments, PIMS, PMFS and Jennison are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
3. Other Transactions with Affiliates
PMFS serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), and its securities lending cash collateral in the PGIM Institutional Money Market Fund (the “Money Market Fund”), each a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund and Money Market Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income” and “Income from securities lending, net”, respectively.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Fund’s Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $569,020,677 and $219,791,611, respectively.
26 |
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
Value, Beginning of Period | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 11,654,389 | $ | 274,118,322 | $ | 242,636,465 | $ | — | $ | — | $ | 43,136,246 | 43,136,246 | $ | 155,404 | ||||||||||||||||
PGIM Institutional Money Market Fund* | ||||||||||||||||||||||||||||||
12,383,731 | 99,555,424 | 65,675,687 | 79,812 | (25,414 | ) | 46,317,866 | 46,327,131 | 75,640 | ** | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
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| |||||||||||||||||
$ | 24,038,120 | $ | 373,673,746 | $ | 308,312,152 | $ | 79,812 | $ | (25,414 | ) | $ | 89,454,112 | $ | 231,044 | ||||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
** | Represents the affiliated amount of securities lending income shown on the Statement of Operations. |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized appreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 920,638,698 | ||
|
| |||
Gross Unrealized Appreciation | 185,752,643 | |||
Gross Unrealized Depreciation | (25,881,240 | ) | ||
|
| |||
Net Unrealized Appreciation | $ | 159,871,403 | ||
|
|
The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $26,263,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class C, Class R, Class Z, Class R2, Class R4 and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 5.50%. Investors who purchase $1 million or more of Class A shares and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1%, although
PGIM Jennison International Opportunities Fund | 27 |
Notes to Financial Statements (unaudited) (continued)
they are not subject to an initial sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class R, Class Z, Class R2, Class R4 and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, with a par value of $0.01 per share, which is divided into seven series. There are 900 million shares authorized for the Series, divided into eight classes as follows:
Class A | 50,000,000 | |||
Class C | 50,000,000 | |||
Class R | 150,000,000 | |||
Class Z | 175,000,000 | |||
Class T | 125,000,000 | |||
Class R2 | 75,000,000 | |||
Class R4 | 75,000,000 | |||
Class R6 | 200,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class R | 12,360,773 | 99.9 | % | |||||
Class Z | 249 | — | %* | |||||
Class R2 | 662 | 5 | % | |||||
Class R4 | 11,778 | 29 | % |
* | Amount represents less than 1% of outstanding shares. |
28 |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
1 | 25% | 5 | 61% |
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 746,318 | $ | 15,092,904 | |||||
Shares reacquired | (235,930 | ) | (4,638,877 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 510,388 | 10,454,027 | ||||||
Shares issued upon conversion from other share class(es) | 39,566 | 785,296 | ||||||
Shares reacquired upon conversion into other share class(es) | (11,865 | ) | (246,007 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 538,089 | $ | 10,993,316 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 886,104 | $ | 15,632,195 | |||||
Shares reacquired | (462,602 | ) | (8,013,084 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 423,502 | 7,619,111 | ||||||
Shares issued upon conversion from other share class(es) | 70,212 | 1,217,757 | ||||||
Shares reacquired upon conversion into other share class(es) | (37,544 | ) | (681,733 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 456,170 | $ | 8,155,135 | |||||
|
|
|
| |||||
Class C | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 210,592 | $ | 4,096,574 | |||||
Shares reacquired | (44,038 | ) | (767,893 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 166,554 | 3,328,681 | ||||||
Shares reacquired upon conversion into other share class(es) | (4,959 | ) | (95,203 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 161,595 | $ | 3,233,478 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 161,032 | $ | 2,618,485 | |||||
Shares reacquired | (104,446 | ) | (1,712,809 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 56,586 | 905,676 | ||||||
Shares reacquired upon conversion into other share class(es) | (21,102 | ) | (374,296 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 35,484 | $ | 531,380 | |||||
|
|
|
| |||||
Class R | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 276,554 | $ | 5,153,068 | |||||
Shares reacquired | (2,299,974 | ) | (44,157,427 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (2,023,420 | ) | $ | (39,004,359 | ) | |||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 1,569,074 | $ | 25,316,140 | |||||
Shares reacquired | (3,973,963 | ) | (71,057,632 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (2,404,889 | ) | $ | (45,741,492 | ) | |||
|
|
|
|
PGIM Jennison International Opportunities Fund | 29 |
Notes to Financial Statements (unaudited) (continued)
Class Z | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 17,710,768 | $ | 357,273,851 | |||||
Shares reacquired | (3,690,338 | ) | (73,115,990 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 14,020,430 | 284,157,861 | ||||||
Shares issued upon conversion from other share class(es) | 12,584 | 262,641 | ||||||
Shares reacquired upon conversion into other share class(es) | (42,167 | ) | (848,563 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 13,990,847 | $ | 283,571,939 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 7,751,651 | $ | 141,168,748 | |||||
Shares issued in reinvestment of dividends and distributions | 3,966 | 60,590 | ||||||
Shares reacquired | (3,691,880 | ) | (64,859,207 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 4,063,737 | 76,370,131 | ||||||
Shares issued upon conversion from other share class(es) | 40,055 | 738,030 | ||||||
Shares reacquired upon conversion into other share class(es) | (54,165 | ) | (928,258 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 4,049,627 | $ | 76,179,903 | |||||
|
|
|
| |||||
Class R2 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 282 | $ | 5,706 | |||||
Shares reacquired | — | (1 | ) | |||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 282 | $ | 5,705 | |||||
|
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|
| |||||
Period ended October 31, 2019*: | ||||||||
Shares sold | 11,835 | $ | 224,514 | |||||
Shares reacquired | — | (1 | ) | |||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 11,835 | $ | 224,513 | |||||
|
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|
| |||||
Class R4 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 2,699 | $ | 54,375 | |||||
Shares reacquired | (4,730 | ) | (92,824 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | (2,031 | ) | $ | (38,449 | ) | |||
|
|
|
| |||||
Period ended October 31, 2019*: | ||||||||
Shares sold | 44,181 | $ | 838,319 | |||||
Shares reacquired | (1,337 | ) | (25,439 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 42,844 | $ | 812,880 | |||||
|
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|
30 |
Class R6 | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 6,283,141 | $ | 128,203,480 | |||||
Shares reacquired | (886,652 | ) | (17,439,049 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 5,396,489 | 110,764,431 | ||||||
Shares issued upon conversion from other share class(es) | 8,113 | 167,758 | ||||||
Shares reacquired upon conversion into other share class(es) | (1,248 | ) | (25,922 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding | 5,403,354 | $ | 110,906,267 | |||||
|
|
|
| |||||
Year ended October 31, 2019: | ||||||||
Shares sold | 4,858,514 | $ | 90,601,715 | |||||
Shares issued in reinvestment of dividends and distributions | 3,322 | 50,751 | ||||||
Shares reacquired | (1,901,872 | ) | (35,378,979 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in shares outstanding before conversion | 2,959,964 | 55,273,487 | ||||||
Shares issued upon conversion from other share class(es) | 1,565 | 28,500 | ||||||
|
|
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| |||||
Net increase (decrease) in shares outstanding | 2,961,529 | $ | 55,301,987 | |||||
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|
|
* | Commencement of offering was December 27, 2018. |
7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $ 1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent |
* | Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
PGIM Jennison International Opportunities Fund | 31 |
Notes to Financial Statements (unaudited) (continued)
The Series did not utilize the SCA during the reporting period ended April 30, 2020.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Equity and Equity-Related Securities Risks: The value of a particular security could go down and you could lose money. In addition to an individual security losing value, the value of the equity markets or a sector in which the Series invests could go down. The Series’ holdings can vary significantly from broad market indexes and the performance of the Series can deviate from the performance of these indexes. Different parts of a market can react differently to adverse issuer, market, regulatory, political and economic developments.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s
32 |
financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
PGIM Jennison International Opportunities Fund | 33 |
Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.51 | $15.82 | $17.10 | $12.36 | $13.09 | $13.06 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.03 | ) | 0.01 | (0.06 | ) | (0.01 | ) | 0.02 | (0.05 | ) | ||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.79 | 3.68 | (1.22 | ) | 4.75 | (0.75 | ) | 0.08 | ||||||||||||||||||||
Total from investment operations | 0.76 | 3.69 | (1.28 | ) | 4.74 | (0.73 | ) | 0.03 | ||||||||||||||||||||
Net asset value, end of period | $20.27 | $19.51 | $15.82 | $17.10 | $12.36 | $13.09 | ||||||||||||||||||||||
Total Return(b): | 3.89% | 23.39% | (7.49)% | 38.35% | (5.58)% | 0.23% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $38,727 | $26,778 | $14,496 | $5,303 | $2,918 | $4,167 | ||||||||||||||||||||||
Average net assets (000) | $32,917 | $20,599 | $10,393 | $3,121 | $3,575 | $3,179 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.09% | (e) | 1.09% | 1.13% | 1.15% | 1.15% | 1.55% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.35% | (e) | 1.46% | 1.55% | 1.63% | 1.74% | 1.67% | |||||||||||||||||||||
Net investment income (loss) | (0.31)% | (e) | 0.04% | (0.32)% | (0.07)% | 0.15% | (0.39)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 29% | 53% | 59% | 69% | 65% | 75% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
34 |
Class C Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $18.44 | $15.08 | $16.43 | $11.96 | $12.77 | $12.82 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.10 | ) | (0.13 | ) | (0.18 | ) | (0.11 | ) | (0.08 | ) | (0.15 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.74 | 3.49 | (1.17 | ) | 4.58 | (0.73 | ) | 0.10 | ||||||||||||||||||||
Total from investment operations | 0.64 | 3.36 | (1.35 | ) | 4.47 | (0.81 | ) | (0.05 | ) | |||||||||||||||||||
Net asset value, end of period | $19.08 | $18.44 | $15.08 | $16.43 | $11.96 | $12.77 | ||||||||||||||||||||||
Total Return(b): | 3.52% | 22.28% | (8.22)% | 37.37% | (6.34)% | (0.39)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $8,569 | $5,302 | $3,800 | $1,759 | $779 | $1,215 | ||||||||||||||||||||||
Average net assets (000) | $7,295 | $4,683 | $3,449 | $1,080 | $895 | $903 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.90% | (e) | 1.91% | 1.92% | 1.89% | 1.90% | 2.30% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.17% | (e) | 2.33% | 2.54% | 2.32% | 2.44% | 2.37% | |||||||||||||||||||||
Net investment income (loss) | (1.10)% | (e) | (0.80)% | (1.05)% | (0.80)% | (0.67)% | (1.15)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 29% | 53% | 59% | 69% | 65% | 75% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 35 |
Financial Highlights (unaudited) (continued)
Class R Shares | ||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | November 20, 2018 | ||||||||||||||||||
2019 | ||||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.48 | $15.86 | $17.62 | |||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.07 | ) | (0.06 | ) | (0.09 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.79 | 3.68 | (1.67 | ) | ||||||||||||||||
Total from investment operations | 0.72 | 3.62 | (1.76 | ) | ||||||||||||||||
Net asset value, end of period | $20.20 | $19.48 | $15.86 | |||||||||||||||||
Total Return(c): | 3.69% | 22.89% | (9.99)% | |||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (000) | $249,772 | $280,311 | $266,294 | |||||||||||||||||
Average net assets (000) | $272,938 | $278,086 | $299,955 | |||||||||||||||||
Ratios to average net assets(d): | ||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.47% | (e) | 1.47% | 1.46% | (e) | |||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.78% | (e) | 1.81% | 1.80% | (e) | |||||||||||||||
Net investment income (loss) | (0.74)% | (e) | (0.36)% | (0.53)% | (e) | |||||||||||||||
Portfolio turnover rate(f) | 29% | 53% | 59% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
36 |
Class Z Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||||||||||
Per Share Operating Performance(a): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.77 | $16.01 | $17.29 | $12.50 | $13.20 | $13.13 | ||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | (0.01 | ) | 0.03 | (0.01 | ) | 0.03 | 0.03 | (0.03 | ) | |||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.80 | 3.74 | (1.24 | ) | 4.79 | (0.73 | ) | 0.10 | ||||||||||||||||||||
Total from investment operations | 0.79 | 3.77 | (1.25 | ) | 4.82 | (0.70 | ) | 0.07 | ||||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | - | (0.01 | ) | (0.03 | ) | (0.03 | ) | - | - | |||||||||||||||||||
Net asset value, end of period | $20.56 | $19.77 | $16.01 | $17.29 | $12.50 | $13.20 | ||||||||||||||||||||||
Total Return(b): | 4.00% | 23.56% | (7.24)% | 38.65% | (5.30)% | 0.53% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $504,587 | $208,629 | $104,113 | $28,612 | $18,667 | $46,105 | ||||||||||||||||||||||
Average net assets (000) | $304,523 | $139,982 | $75,711 | $21,756 | $23,274 | $47,187 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.90% | (e) | 0.90% | 0.89% | 0.89% | 0.90% | 1.31% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 0.96% | (e) | 1.04% | 1.04% | 1.34% | 1.41% | 1.40% | |||||||||||||||||||||
Net investment income (loss) | (0.09)% | (e) | 0.15% | (0.08)% | 0.23% | 0.25% | (0.19)% | |||||||||||||||||||||
Portfolio turnover rate(f) | 29% | 53% | 59% | 69% | 65% | 75% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 37 |
Financial Highlights (unaudited) (continued)
Class R2 Shares | ||||||||||||
Six Months Ended April 30, 2020 | December 27, 2018(a) through October 31, 2019 | |||||||||||
Per Share Operating Performance(b): | ||||||||||||
Net Asset Value, Beginning of Period | $19.70 | $15.10 | ||||||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss) | (0.04 | ) | (0.12 | ) | ||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.79 | 4.72 | ||||||||||
Total from investment operations | 0.75 | 4.60 | ||||||||||
Net asset value, end of period | $20.45 | $19.70 | ||||||||||
Total Return(c): | 3.86% | 30.46% | ||||||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets, end of period (000) | $248 | $233 | ||||||||||
Average net assets (000) | $244 | $44 | ||||||||||
Ratios to average net assets(d): | ||||||||||||
Expenses after waivers and/or expense reimbursement | 1.19% | (e) | 1.26% | (e) | ||||||||
Expenses before waivers and/or expense reimbursement | 8.36% | (e) | 64.97% | (e) | ||||||||
Net investment income (loss) | (0.43)% | (e) | (0.76)% | (e) | ||||||||
Portfolio turnover rate(f) | 29% | 53% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
38 |
Class R4 Shares | ||||||||||||
Six Months Ended April 30, 2020 | December 27, 2018(a) through October 31, 2019 | |||||||||||
Per Share Operating Performance(b): | ||||||||||||
Net Asset Value, Beginning of Period | $19.75 | $15.10 | ||||||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss) | (0.02 | ) | (0.02 | ) | ||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.80 | 4.67 | ||||||||||
Total from investment operations | 0.78 | 4.65 | ||||||||||
Net asset value, end of period | $20.53 | $19.75 | ||||||||||
Total Return(c): | 3.95% | 30.79% | ||||||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets, end of period (000) | $838 | $846 | ||||||||||
Average net assets (000) | $862 | $293 | ||||||||||
Ratios to average net assets(d): | ||||||||||||
Expenses after waivers and/or expense reimbursement | 0.97% | (e) | 0.95% | (e) | ||||||||
Expenses before waivers and/or expense reimbursement | 3.11% | (e) | 10.65% | (e) | ||||||||
Net investment income (loss) | (0.24)% | (e) | (0.11)% | (e) | ||||||||
Portfolio turnover rate(f) | 29% | 53% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison International Opportunities Fund | 39 |
Financial Highlights (unaudited) (continued)
Class R6 Shares | ||||||||||||||||||||||||||||
Six Months 2020 | Year Ended October 31, | December 23, 2016 | ||||||||||||||||||||||||||
2019 | 2018 | 2017 | ||||||||||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.78 | $16.02 | $17.29 | $12.50 | $13.25 | |||||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | - | (c) | 0.04 | (0.01 | ) | 0.04 | 0.06 | |||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | 0.80 | 3.74 | (1.22 | ) | 4.79 | (0.81 | ) | |||||||||||||||||||||
Total from investment operations | 0.80 | 3.78 | (1.23 | ) | 4.83 | (0.75 | ) | |||||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||||||
Dividends from net investment income | - | (0.02 | ) | (0.04 | ) | (0.04 | ) | - | ||||||||||||||||||||
Net asset value, end of period | $20.58 | $19.78 | $16.02 | $17.29 | $12.50 | |||||||||||||||||||||||
Total Return(d): | 4.04% | 23.72% | (7.15)% | 38.75% | (5.66)% | |||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $217,258 | $101,975 | $35,141 | $26,252 | $23,073 | |||||||||||||||||||||||
Average net assets (000) | $152,283 | $54,900 | $26,736 | $24,927 | $23,677 | |||||||||||||||||||||||
Ratios to average net assets(e)(f): | ||||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.84% | (g) | 0.84% | 0.84% | 0.84% | 0.84% | (g) | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 0.91% | (g) | 0.98% | 1.00% | 1.30% | 1.43% | (g) | |||||||||||||||||||||
Net investment income (loss) | (0.01)% | (g) | 0.20% | (0.05)% | 0.28% | 0.60% | (g) | |||||||||||||||||||||
Portfolio turnover rate(h) | 29% | 53% | 59% | 69% | 65% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Less than $(0.005) per share. |
(d) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(e) | Does not include expenses of the underlying funds in which the Series invests. |
(f) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(g) | Annualized. |
(h) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
40 |
Series Liquidity Risk Management Program
(unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Jennison International Opportunities Fund | 41 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | Jennison Associates LLC | 466 Lexington Avenue New York, NY 10017 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue New York, NY 10017 | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Jennison International Opportunities Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM JENNISON INTERNATIONAL OPPORTUNITIES FUND
SHARE CLASS | A | C | R | Z | R2 | R4 | R6 | |||||||
NASDAQ | PWJAX | PWJCX | PWJRX | PWJZX | PWJBX | PWJDX | PWJQX | |||||||
CUSIP | 743969677 | 743969669 | 743969487 | 743969651 | 743969412 | 743969396 | 743969586 |
MF215E2
PGIM JENNISON GLOBAL INFRASTRUCTURE FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
3 | ||||
4 | ||||
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9 |
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC, member SIPC. Jennison Associates LLC is a registered investment adviser. Both are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, PGIM, and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
2 | Visit our website at pgiminvestments.com |
Dear Shareholder:
We hope you find the semiannual report for PGIM Jennison Global Infrastructure Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Jennison Global Infrastructure Fund
June 15, 2020
PGIM Jennison Global Infrastructure Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
(without sales charges) | Average Annual Total Returns as of 4/30/20 (with sales charges) | |||||||
Six Months* (%) | One Year (%) | Five Years (%) | Since Inception (%) | |||||
Class A | –10.64 | –10.33 | 0.36 | 4.54 (9/25/13) | ||||
Class C | –10.92 | –6.75 | 0.76 | 4.65 (9/25/13) | ||||
Class Z | –10.49 | –4.79 | 1.78 | 5.71 (9/25/13) | ||||
Class R6 | –10.49 | –4.79 | N/A | 5.83 (12/28/16) | ||||
S&P Global Infrastructure Index | ||||||||
–20.07 | –15.55 | –0.35 | — | |||||
S&P 500 Index | ||||||||
–3.15 | 0.88 | 9.12 | — |
Average Annual Total Returns as of 4/30/20 Since Inception (%) | ||||
Class A,C,Z (9/25/13) | Class R6 (12/28/16) | |||
S&P Global Infrastructure Index | 2.65 | 1.12 | ||
S&P 500 Index | 10.94 | 10.37 |
*Not annualized
Source: PGIM Investments LLC and Lipper Inc.
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Indexes are measured from the closest month-end to the class’ inception date.
4 | Visit our website at pgiminvestments.com |
The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class Z | Class R6 | |||||
Maximum initial sales charge | 5.50% of the public offering price | None | None | None | ||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | 1.00% on sales of $1 million or more made within 12 months of purchase | 1.00% on sales made within 12 months of purchase | None | None | ||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.30% (0.25% currently) | 1.00% | None | None |
Benchmark Definitions
S&P Global Infrastructure Index—The S&P Global Infrastructure Index is an unmanaged index that consists of 75 companies from around the world that represent the listed infrastructure universe. To create diversified exposure across the global listed infrastructure market, the Index has balanced weights across three distinct infrastructure clusters: Utilities, Transportation, and Energy.
S&P 500 Index—The S&P 500 Index is an unmanaged index of over 500 stocks of large US public companies. It gives a broad look at how stock prices in the United States have performed.
Investors cannot invest directly in an index. The returns for the Indexes would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
PGIM Jennison Global Infrastructure Fund | 5 |
Your Fund’s Performance (continued)
Presentation of Fund Holdings as of 4/30/20
Ten Largest Holdings | Line of Business | Country | % of Net Assets | |||
NextEra Energy, Inc., | Electric Utilities | United States | 5.7% | |||
RWE AG, | Multi-Utilities | Germany | 4.4% | |||
Cellnex Telecom SA, 144A | Diversified Telecommunication Services | Spain | 4.2% | |||
FirstEnergy Corp., | Electric Utilities | United States | 4.0% | |||
Dominion Energy, Inc., | Multi-Utilities | United States | 3.4% | |||
Essential Utilities, Inc., | Water Utilities | United States | 3.2% | |||
Enel SpA, | Electric Utilities | Italy | 3.2% | |||
American Electric Power Co., Inc., | Electric Utilities | United States | 3.1% | |||
Iberdrola SA, | Electric Utilities | Spain | 3.0% | |||
Equinix, Inc. | Equity Real Estate Investment Trusts (REITs) | United States | 2.9% |
Holdings reflect only long-term investments and are subject to change.
6 | Visit our website at pgiminvestments.com |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
PGIM Jennison Global Infrastructure Fund | 7 |
Fees and Expenses (continued)
and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Jennison Global Infrastructure Fund | Beginning Account Value November 1, 2019 | Ending Account Value April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 893.60 | 1.50 | % | $ | 7.06 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,017.40 | 1.50 | % | $ | 7.52 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 890.80 | 2.25 | % | $ | 10.58 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,013.67 | 2.25 | % | $ | 11.27 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 895.10 | 1.17 | % | $ | 5.51 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.05 | 1.17 | % | $ | 5.87 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 895.10 | 1.17 | % | $ | 5.51 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.05 | 1.17 | % | $ | 5.87 |
*Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
8 | Visit our website at pgiminvestments.com |
Schedule of Investments (unaudited)
as of April 30, 2020
Description | Shares | Value | ||||||
LONG-TERM INVESTMENTS 99.5% | ||||||||
COMMON STOCKS 97.9% | ||||||||
Australia 8.5% | ||||||||
APA Group | 87,095 | $ | 610,201 | |||||
Atlas Arteria Ltd. | 197,648 | 801,163 | ||||||
Cleanaway Waste Management Ltd. | 459,221 | 555,833 | ||||||
Spark Infrastructure Group | 459,149 | 566,709 | ||||||
Transurban Group | 70,747 | 634,887 | ||||||
|
| |||||||
3,168,793 | ||||||||
Brazil 1.0% | ||||||||
Rumo SA* | 103,857 | 376,245 | ||||||
Canada 5.9% | ||||||||
Emera, Inc. | 15,461 | 615,463 | ||||||
Enbridge, Inc. | 25,557 | 783,078 | ||||||
Pembina Pipeline Corp. | 8,002 | 183,566 | ||||||
TC Energy Corp. | 12,896 | 593,497 | ||||||
|
| |||||||
2,175,604 | ||||||||
China 1.5% | ||||||||
China Resources Gas Group Ltd. | 34,748 | 196,378 | ||||||
China Tower Corp. Ltd. (Class H Stock), 144A* | 1,686,794 | 372,721 | ||||||
|
| |||||||
569,099 | ||||||||
Denmark 2.6% | ||||||||
Orsted A/S, 144A | 9,659 | 976,764 | ||||||
France 5.1% | ||||||||
Eiffage SA | 8,606 | 696,912 | ||||||
Getlink SE | 16,800 | 214,183 | ||||||
Vinci SA | 12,265 | 1,001,466 | ||||||
|
| |||||||
1,912,561 | ||||||||
Germany 4.4% | ||||||||
RWE AG | 57,467 | 1,649,818 | ||||||
Italy 4.9% | ||||||||
Enav SpA, 144A | 139,331 | 624,866 | ||||||
Enel SpA | 172,480 | 1,180,123 | ||||||
|
| |||||||
1,804,989 |
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Shares | Value | ||||||
COMMON STOCKS (Continued) | ||||||||
Spain 9.7% | ||||||||
Cellnex Telecom SA, 144A | 30,017 | $ | 1,571,720 | |||||
Ferrovial SA | 37,285 | 928,715 | ||||||
Iberdrola SA | 110,330 | 1,102,158 | ||||||
|
| |||||||
3,602,593 | ||||||||
United Kingdom 2.7% | ||||||||
National Grid PLC | 45,879 | 539,596 | ||||||
SSE PLC | 28,959 | 456,024 | ||||||
|
| |||||||
995,620 | ||||||||
United States 51.6% | ||||||||
Alliant Energy Corp. | 12,284 | 596,388 | ||||||
American Electric Power Co., Inc. | 14,064 | 1,168,859 | ||||||
American Tower Corp., REIT | 3,961 | 942,718 | ||||||
Cheniere Energy, Inc.* | 16,990 | 793,263 | ||||||
Crown Castle International Corp., REIT | 6,274 | 1,000,264 | ||||||
Dominion Energy, Inc. | 16,562 | 1,277,427 | ||||||
Edison International | 17,468 | 1,025,546 | ||||||
Equinix, Inc., REIT | 1,592 | 1,074,918 | ||||||
Essential Utilities, Inc. | 28,599 | 1,195,152 | ||||||
Exelon Corp. | 9,789 | 362,976 | ||||||
FirstEnergy Corp. | 35,772 | 1,476,311 | ||||||
Kinder Morgan, Inc. | 22,895 | 348,691 | ||||||
NextEra Energy, Inc. | 9,131 | 2,110,356 | ||||||
Norfolk Southern Corp. | 5,066 | 866,793 | ||||||
SBA Communications Corp., REIT | 1,984 | 575,201 | ||||||
Sempra Energy | 8,362 | 1,035,634 | ||||||
Union Pacific Corp. | 5,100 | 814,929 | ||||||
Waste Connections, Inc. | 10,133 | 870,526 | ||||||
Waste Management, Inc. | 8,106 | 810,762 | ||||||
Williams Cos., Inc. (The) | 46,026 | 891,524 | ||||||
|
| |||||||
19,238,238 | ||||||||
|
| |||||||
TOTAL COMMON STOCKS | 36,470,324 | |||||||
|
|
See Notes to Financial Statements.
10 |
Description | Shares | Value | ||||||
PREFERRED STOCK 1.6% | ||||||||
Canada | ||||||||
GFL Environmental, Inc., CVT, 6.000%* | 12,189 | $ | 597,383 | |||||
|
| |||||||
TOTAL LONG-TERM INVESTMENTS | 37,067,707 | |||||||
|
| |||||||
SHORT-TERM INVESTMENT 0.6% | ||||||||
AFFILIATED MUTUAL FUND | ||||||||
PGIM Core Ultra Short Bond Fund | 240,918 | 240,918 | ||||||
|
| |||||||
TOTAL INVESTMENTS 100.1% | 37,308,625 | |||||||
Liabilities in excess of other assets (0.1)% | (49,911 | ) | ||||||
|
| |||||||
NET ASSETS 100.0% | $ | 37,258,714 | ||||||
|
|
Below is a list of the abbreviation(s) used in the semiannual report:
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
CVT—Convertible Security
LIBOR—London Interbank Offered Rate
REITs—Real Estate Investment Trust
* | Non-income producing security. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund. |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Common Stocks | ||||||||||||
Australia | $ | — | $ | 3,168,793 | $ | — | ||||||
Brazil | 376,245 | — | — |
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities (continued) | ||||||||||||
Assets (continued) | ||||||||||||
Common Stocks (continued) | ||||||||||||
Canada | $ | 2,175,604 | $ | — | $ | — | ||||||
China | — | 569,099 | — | |||||||||
Denmark | — | 976,764 | — | |||||||||
France | — | 1,912,561 | — | |||||||||
Germany | — | 1,649,818 | — | |||||||||
Italy | — | 1,804,989 | — | |||||||||
Spain | — | 3,602,593 | — | |||||||||
United Kingdom | — | 995,620 | — | |||||||||
United States | 19,238,238 | — | — | |||||||||
Preferred Stock | ||||||||||||
Canada | 597,383 | — | — | |||||||||
Affiliated Mutual Fund | 240,918 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | 22,628,388 | $ | 14,680,237 | $ | — | ||||||
|
|
|
|
|
|
Industry Classification:
The industry classification of investments and liabilities in excess of other assets shown as a percentage of net assets as of April 30, 2020 were as follows:
Electric Utilities | 31.4 | % | ||
Multi-Utilities | 12.1 | |||
Oil, Gas & Consumable Fuels | 9.6 | |||
Equity Real Estate Investment Trusts (REITs) | 9.6 | |||
Commercial Services & Supplies | 7.6 | |||
Construction & Engineering | 7.0 | |||
Transportation Infrastructure | 6.2 | |||
Road & Rail | 5.5 | |||
Diversified Telecommunication Services | 5.2 | |||
Water Utilities | 3.2 | % | ||
Gas Utilities | 2.1 | |||
Affiliated Mutual Fund | 0.6 | |||
|
| |||
100.1 | ||||
Liabilities in excess of other assets | (0.1 | ) | ||
|
| |||
100.0 | % | |||
|
|
See Notes to Financial Statements.
12 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value: | ||||
Unaffiliated investments (cost $31,509,043) | $ | 37,067,707 | ||
Affiliated investments (cost $240,918) | 240,918 | |||
Tax reclaim receivable | 19,119 | |||
Dividends and interest receivable | 11,460 | |||
Receivable for Series shares sold | 4,763 | |||
Prepaid expenses | 7,976 | |||
|
| |||
Total Assets | 37,351,943 | |||
|
| |||
Liabilities | ||||
Custodian and accounting fees payable | 23,684 | |||
Shareholders’ reports payable | 18,269 | |||
Audit fee payable | 14,075 | |||
Management fee payable | 12,751 | |||
Payable for Series shares reacquired | 9,737 | |||
Transfer agent’s fees and expenses payable | 5,831 | |||
Distribution fee payable | 4,011 | |||
Accrued expenses and other liabilities | 2,803 | |||
Affiliated transfer agent fee payable | 2,068 | |||
|
| |||
Total Liabilities | 93,229 | |||
|
| |||
Net Assets | $ | 37,258,714 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 28,560 | ||
Paid-in capital in excess of par | 33,157,334 | |||
Total distributable earnings (loss) | 4,072,820 | |||
|
| |||
Net assets, April 30, 2020 | $ | 37,258,714 | ||
|
|
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 13 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Class A | ||||
Net asset value and redemption price per share, | $ | 13.06 | ||
Maximum sales charge (5.50% of offering price) | 0.76 | |||
|
| |||
Maximum offering price to public | $ | 13.82 | ||
|
| |||
Class C | ||||
Net asset value, offering price and redemption price per share, | ||||
($3,463,324 ÷ 268,354 shares of common stock issued and outstanding) | $ | 12.91 | ||
|
| |||
Class Z | ||||
Net asset value, offering price and redemption price per share, | ||||
($19,263,011 ÷ 1,474,763 shares of common stock issued and outstanding) | $ | 13.06 | ||
|
| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | ||||
($8,258,728 ÷ 632,394 shares of common stock issued and outstanding) | $ | 13.06 | ||
|
|
See Notes to Financial Statements.
14 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Unaffiliated dividend income (net of $27,470 foreign withholding tax) | $ | 515,560 | ||
Affiliated dividend income | 6,869 | |||
|
| |||
Total income | 522,429 | |||
|
| |||
Expenses | ||||
Management fee | 218,179 | |||
Distribution fee(a) | 30,624 | |||
Custodian and accounting fees | 37,317 | |||
Registration fees(a) | 24,188 | |||
Shareholders’ reports | 19,998 | |||
Transfer agent’s fees and expenses (including affiliated expense of $5,736)(a) | 19,090 | |||
Audit fee | 14,074 | |||
Legal fees and expenses | 8,189 | |||
Directors’ fees | 5,626 | |||
Miscellaneous | 11,008 | |||
|
| |||
Total expenses | 388,293 | |||
Less: Fee waiver and/or expense reimbursement(a) | (97,412 | ) | ||
Distribution fee waiver(a) | (1,825 | ) | ||
|
| |||
Net expenses | 289,056 | |||
|
| |||
Net investment income (loss) | 233,373 | |||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions | (124,315 | ) | ||
Foreign currency transactions | (14,019 | ) | ||
|
| |||
(138,334 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | (4,671,881 | ) | ||
Foreign currencies | 1,120 | |||
|
| |||
(4,670,761 | ) | |||
|
| |||
Net gain (loss) on investment and foreign currency transactions | (4,809,095 | ) | ||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | (4,575,722 | ) | |
|
|
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class Z | Class R6 | |||||||||||||
Distribution fee | 10,948 | 19,676 | — | — | ||||||||||||
Registration fees | 6,442 | 6,442 | 6,443 | 4,861 | ||||||||||||
Transfer agent’s fees and expenses | 7,088 | 3,099 | 8,867 | 36 | ||||||||||||
Fee waiver and/or expense reimbursement | (20,420 | ) | (13,265 | ) | (44,115 | ) | (19,612 | ) | ||||||||
Distribution fee waiver | (1,825 | ) | — | — | — |
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 15 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 233,373 | $ | 721,693 | ||||
Net realized gain (loss) on investment and foreign currency transactions | (138,334 | ) | 3,320,407 | |||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | (4,670,761 | ) | 5,353,721 | |||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | (4,575,722 | ) | 9,395,821 | |||||
|
|
|
| |||||
Dividends and Distributions | ||||||||
Distributions from distributable earnings | ||||||||
Class A | (23,788 | ) | (117,355 | ) | ||||
Class C | (4,866 | ) | (40,973 | ) | ||||
Class Z | (103,138 | ) | (388,838 | ) | ||||
Class R6 | (57,831 | ) | (263,857 | ) | ||||
|
|
|
| |||||
(189,623 | ) | (811,023 | ) | |||||
|
|
|
| |||||
Tax return of capital distributions | ||||||||
Class A | — | (6,757 | ) | |||||
Class C | — | (2,359 | ) | |||||
Class Z | — | (22,389 | ) | |||||
Class R6 | — | (15,193 | ) | |||||
|
|
|
| |||||
— | (46,698 | ) | ||||||
|
|
|
| |||||
Series share transactions (Net of share conversions) | ||||||||
Net proceeds from shares sold | 4,375,609 | 7,794,683 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | 188,959 | 852,911 | ||||||
Cost of shares reacquired | (8,135,251 | ) | (20,811,750 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | (3,570,683 | ) | (12,164,156 | ) | ||||
|
|
|
| |||||
Total increase (decrease) | (8,336,028 | ) | (3,626,056 | ) | ||||
Net Assets: | ||||||||
Beginning of period | 45,594,742 | 49,220,798 | ||||||
|
|
|
| |||||
End of period | $ | 37,258,714 | $ | 45,594,742 | ||||
|
|
|
|
See Notes to Financial Statements.
16 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act. These financial statements relate only to the PGIM Jennison Global Infrastructure Fund (the “Series”).
The investment objective of the Series is to achieve total return.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services—Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund’s Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
PGIM Jennison Global Infrastructure Fund | 17 |
Notes to Financial Statements (unaudited) (continued)
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Common and preferred stocks, exchange-traded funds, and derivative instruments, such as futures or options, that are traded on a national securities exchange are valued at the last sale price as of the close of trading on the applicable exchange where the security principally trades. Securities traded via NASDAQ are valued at the NASDAQ official closing price. To the extent these securities are valued at the last sale price or NASDAQ official closing price, they are classified as Level 1 in the fair value hierarchy. In the event that no sale or official closing price on valuation date exists, these securities are generally valued at the mean between the last reported bid and ask prices, or at the last bid price in the absence of an ask price. These securities are classified as Level 2 in the fair value hierarchy.
Foreign equities traded on foreign securities exchanges are generally valued using pricing vendor services that provide model prices derived using adjustment factors based on information such as local closing price, relevant general and sector indices, currency fluctuations, depositary receipts, and futures, as applicable. Securities valued using such model prices are classified as Level 2 in the fair value hierarchy. The models generate an evaluated adjustment factor for each security, which is applied to the local closing price to adjust it for post closing market movements up to the time the Series is valued. Utilizing that evaluated adjustment factor, the vendor provides an evaluated price for each security. If the vendor does not provide an evaluated price, securities are valued in accordance with exchange-traded common and preferred stock valuation policies discussed above.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any
18 |
comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally 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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign
PGIM Jennison Global Infrastructure Fund | 19 |
Notes to Financial Statements (unaudited) (continued)
currency gains (losses) are included in the reported net realized gains (losses) on investment transactions.
Net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Equity and Mortgage Real Estate Investment Trusts (collectively equity REITs): The Series invested in equity REITs, which report information on the source of their distributions annually. Based on current and historical information, a portion of distributions received from equity REITs during the period is estimated to be dividend income, capital gain or return of capital and recorded accordingly. When material, these estimates are adjusted periodically when the actual source of distributions is disclosed by the equity REITs.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Tax reform legislation commonly referred to as the Tax Cuts and Jobs Act permits a direct REIT shareholder to claim a 20% “qualified business income” deduction for ordinary REIT
20 |
dividends. On January 18, 2019, the Internal Revenue Service issued final regulations that expressly permit RICs to pass through this “qualified business income” to their shareholders.
Dividends and Distributions: The Series expects to pay dividends from net investment income quarterly. Distributions from net realized capital and currency gains, if any, are declared and paid annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with Jennison Associates LLC (“Jennison”). The subadvisory agreement provides that Jennison will furnish investment advisory services in connection with the management of the Series. In connection therewith, Jennison is obligated to keep certain books and records of the Series. The Manager pays for the services of Jennison, the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
The management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 1.00% of the Series’ average daily net assets up to $1 billion, 0.98% of the next $2 billion, 0.96% of the next $2 billion, 0.95% of the next $5 billion and 0.94% of the Series’ average daily net assets in excess of $10 billion. The effective management fee rate
PGIM Jennison Global Infrastructure Fund | 21 |
Notes to Financial Statements (unaudited) (continued)
before any waivers and/or expense reimbursements was 1.00% for the reporting period ended April 30, 2020.
The Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.50% of average daily net assets for Class A shares, 2.25% of average daily net assets for Class C shares, 1.17% of average daily net assets for Class Z shares and 1.17% of average daily net assets for Class R6 shares. This contractual waiver excludes interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class. In addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver and/or reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for the fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class Z and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A and Class C shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z and Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.30% and 1% of the average daily net assets of the Class A and Class C shares, respectively. PIMS has contractually agreed through February 28, 2021 to limit such fees to 0.25% of the average daily net assets of the Class A shares.
For the reporting period ended April 30, 2020, PIMS received $7,482 in front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS received $10 in contingent deferred sales charges imposed upon redemptions by certain Class C shareholders. From these fees, PIMS paid such sales charges to broker-dealers, who in turn paid commissions to salespersons and incurred other distribution costs.
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PGIM Investments, PIMS and Jennison are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PGIM Investments and an indirect, wholly-owned subsidiary of Prudential, serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income”.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Fund’s Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $12,132,145 and $15,602,863, respectively.
A summary of the cost of purchases and proceeds from sales of shares of affiliated investments for the reporting period ended April 30, 2020, is presented as follows:
PGIM Jennison Global Infrastructure Fund | 23 |
Notes to Financial Statements (unaudited) (continued)
Value, | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 598,186 | $ | 12,097,440 | $ | 12,454,708 | $ | — | $ | — | $ | 240,918 | 240,918 | $ | 6,869 | ||||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized appreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 31,851,601 | ||
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| |||
Gross Unrealized Appreciation | 6,343,398 | |||
Gross Unrealized Depreciation | (886,374 | ) | ||
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Net Unrealized Appreciation | $ | 5,457,024 | ||
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The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $1,269,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the four fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
6. Capital and Ownership
The Series offers Class A, Class C, Class Z and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 5.50%. Investors who purchase $1 million or more of Class A shares and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1%, although they are not subject to an initial sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made
24 |
within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, with a par value of $0.01 per share, which is divided into seven series. There are 510 million shares authorized for the Series, divided into five classes as follows:
Class A | 20,000,000 | |||
Class C | 100,000,000 | |||
Class Z | 150,000,000 | |||
Class T | 115,000,000 | |||
Class R6 | 125,000,000 |
The Series currently does not have any Class T shares outstanding.
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class Z | 552,204 | 37 | % | |||||
Class R6 | 629,993 | 99.6 | % |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
2 | 41% | 3 | 39% |
PGIM Jennison Global Infrastructure Fund | 25 |
Notes to Financial Statements (unaudited) (continued)
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 26,424 | $ | 371,608 | |||||
Shares issued in reinvestment of dividends and distributions | 1,596 | 23,717 | ||||||
Shares reacquired | (71,405 | ) | (955,168 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (43,385 | ) | (559,843 | ) | ||||
Shares issued upon conversion from other share class(es) | 3,680 | 50,629 | ||||||
Shares reacquired upon conversion into other share class(es) | (878 | ) | (13,161 | ) | ||||
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Net increase (decrease) in shares outstanding | (40,583 | ) | $ | (522,375 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 47,121 | $ | 656,918 | |||||
Shares issued in reinvestment of dividends and distributions | 9,224 | 123,554 | ||||||
Shares reacquired | (168,355 | ) | (2,251,714 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (112,010 | ) | (1,471,242 | ) | ||||
Shares issued upon conversion from other share class(es) | 8,917 | 124,418 | ||||||
Shares reacquired upon conversion into other share class(es) | (36,937 | ) | (502,336 | ) | ||||
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Net increase (decrease) in shares outstanding | (140,030 | ) | $ | (1,849,160 | ) | |||
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Class C | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 4,859 | $ | 69,855 | |||||
Shares issued in reinvestment of dividends and distributions | 295 | 4,412 | ||||||
Shares reacquired | (16,339 | ) | (229,044 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (11,185 | ) | (154,777 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (5,381 | ) | (77,432 | ) | ||||
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Net increase (decrease) in shares outstanding | (16,566 | ) | $ | (232,209 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 20,243 | $ | 257,217 | |||||
Shares issued in reinvestment of dividends and distributions | 2,966 | 39,509 | ||||||
Shares reacquired | (60,723 | ) | (790,603 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (37,514 | ) | (493,877 | ) | ||||
Shares reacquired upon conversion into other share class(es) | (21,090 | ) | (289,346 | ) | ||||
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Net increase (decrease) in shares outstanding | (58,604 | ) | $ | (783,223 | ) | |||
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Class Z | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 144,364 | $ | 2,047,646 | |||||
Shares issued in reinvestment of dividends and distributions | 7,084 | 102,999 | ||||||
Shares reacquired | (170,557 | ) | (2,323,500 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (19,109 | ) | (172,855 | ) | ||||
Shares issued upon conversion from other share class(es) | 2,519 | 39,964 | ||||||
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Net increase (decrease) in shares outstanding | (16,590 | ) | $ | (132,891 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 82,330 | $ | 1,114,151 | |||||
Shares issued in reinvestment of dividends and distributions | 30,480 | 410,798 | ||||||
Shares reacquired | (559,502 | ) | (7,329,772 | ) | ||||
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Net increase (decrease) in shares outstanding before conversion | (446,692 | ) | (5,804,823 | ) | ||||
Shares issued upon conversion from other share class(es) | 49,142 | 670,622 | ||||||
Shares reacquired upon conversion into other share class(es) | (232 | ) | (3,358 | ) | ||||
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Net increase (decrease) in shares outstanding | (397,782 | ) | $ | (5,137,559 | ) | |||
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Class R6 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 129,776 | $ | 1,886,500 | |||||
Shares issued in reinvestment of dividends and distributions | 3,942 | 57,831 | ||||||
Shares reacquired | (316,674 | ) | (4,627,539 | ) | ||||
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Net increase (decrease) in shares outstanding | (182,956 | ) | $ | (2,683,208 | ) | |||
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Year ended October 31, 2019: | ||||||||
Shares sold | 436,752 | $ | 5,766,397 | |||||
Shares issued in reinvestment of dividends and distributions | 20,791 | 279,050 | ||||||
Shares reacquired | (781,357 | ) | (10,439,661 | ) | ||||
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Net increase (decrease) in shares outstanding | (323,814 | ) | $ | (4,394,214 | ) | |||
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7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $ 1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent |
* | Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
PGIM Jennison Global Infrastructure Fund | 27 |
Notes to Financial Statements (unaudited) (continued)
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series utilized the SCA during the reporting period ended April 30, 2020. The average daily balance for the 5 days that the Series had loans outstanding during the period was approximately $1,231,800, borrowed at a weighted average interest rate of 2.88%. The maximum loan outstanding amount during the period was $1,762,000. At April 30, 2020, the Series did not have an outstanding loan amount.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Equity and Equity-Related Securities Risks: The value of a particular security could go down and you could lose money. In addition to an individual security losing value, the value of the equity markets or a sector in which the Series invests could go down. The Series’ holdings can vary significantly from broad market indexes and the performance of the Series can deviate from the performance of these indexes. Different parts of a market can react differently to adverse issuer, market, regulatory, political and economic developments.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the
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Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
Non-diversification Risk: A non-diversified Series may invest a greater percentage of its assets in the securities of a single company or industry than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund.
Risks of Investing in Infrastructure Companies: Securities of infrastructure companies are more susceptible to adverse economic, social, political and regulatory occurrences affecting their industries. Infrastructure companies may be subject to a variety of factors that may adversely affect their business or operations, including high interest costs in connection with capital construction programs, high leverage, costs associated with environmental and other regulations, the effects of economic slowdown, surplus capacity, insufficient supply of necessary resources, increased competition from other providers of similar services, uncertainties concerning the availability of fuel at reasonable prices, the effects of energy conservation policies and other factors. Certain infrastructure companies may operate in limited areas or have few sources of revenue.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy,
PGIM Jennison Global Infrastructure Fund | 29 |
Notes to Financial Statements (unaudited) (continued)
and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
30 |
Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
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Net Asset Value, Beginning of Period | $14.66 | $12.21 | $13.05 | $11.61 | $11.48 | $12.62 | ||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||
Net investment income (loss) | 0.06 | 0.18 | 0.16 | 0.14 | 0.09 | 0.06 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.61 | ) | 2.49 | (0.81 | ) | 1.49 | 0.21 | (1.12 | ) | |||||||||||||||||||
Total from investment operations | (1.55 | ) | 2.67 | (0.65 | ) | 1.63 | 0.30 | (1.06 | ) | |||||||||||||||||||
Less Dividends and Distributions: |
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Dividends from net investment income | (0.05 | ) | (0.21 | ) | (0.19 | ) | (0.13 | ) | (0.08 | ) | (0.05 | ) | ||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | - | (0.06 | ) | (0.09 | ) | (0.03 | ) | ||||||||||||||||||
Total dividends and distributions | (0.05 | ) | (0.22 | ) | (0.19 | ) | (0.19 | ) | (0.17 | ) | (0.08 | ) | ||||||||||||||||
Net asset value, end of period | $13.06 | $14.66 | $12.21 | $13.05 | $11.61 | $11.48 | ||||||||||||||||||||||
Total Return(b): | (10.64)% | 22.01% | (5.10)% | 14.15% | 2.62% | (8.46)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $6,274 | $7,637 | $8,073 | $11,689 | $12,277 | $22,353 | ||||||||||||||||||||||
Average net assets (000) | $7,339 | $7,718 | $10,218 | $11,433 | $16,694 | $22,695 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): |
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Expenses after waivers and/or expense reimbursement | 1.50% | (e) | 1.50% | 1.50% | 1.50% | 1.50% | 1.50% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.11% | (e) | 2.10% | 2.00% | 1.81% | 1.79% | 1.78% | |||||||||||||||||||||
Net investment income (loss) | 0.89% | (e) | 1.34% | 1.21% | 1.10% | 0.76% | 0.52% | |||||||||||||||||||||
Portfolio turnover rate(f) | 28% | 62% | 75% | 80% | 82% | 94% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 31 |
Financial Highlights (unaudited)(continued)
Class C Shares | ||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
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Net Asset Value, Beginning of Period | $14.51 | $12.12 | $12.97 | $11.55 | $11.42 | $12.58 | ||||||||||||||||||||||
Income (loss) from investment operations: |
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Net investment income (loss) | 0.01 | 0.08 | 0.06 | 0.04 | - | (b) | (0.03 | ) | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.59 | ) | 2.45 | (0.81 | ) | 1.50 | 0.21 | (1.13 | ) | |||||||||||||||||||
Total from investment operations | (1.58 | ) | 2.53 | (0.75 | ) | 1.54 | 0.21 | (1.16 | ) | |||||||||||||||||||
Less Dividends and Distributions: |
| |||||||||||||||||||||||||||
Dividends from net investment income | (0.02 | ) | (0.13 | ) | (0.10 | ) | (0.08 | ) | (0.04 | ) | - | (b) | ||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | - | (0.04 | ) | (0.04 | ) | - | (b) | ||||||||||||||||||
Total dividends and distributions | (0.02 | ) | (0.14 | ) | (0.10 | ) | (0.12 | ) | (0.08 | ) | - | |||||||||||||||||
Net asset value, end of period | $12.91 | $14.51 | $12.12 | $12.97 | $11.55 | $11.42 | ||||||||||||||||||||||
Total Return(c): | (10.92)% | 21.01% | (5.82)% | 13.39% | 1.88% | (9.21)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $3,463 | $4,135 | $4,162 | $6,101 | $5,738 | $6,775 | ||||||||||||||||||||||
Average net assets (000) | $3,957 | $4,131 | $5,464 | $6,111 | $5,783 | $6,353 | ||||||||||||||||||||||
Ratios to average net assets(d)(e): |
| |||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 2.25% | (f) | 2.25% | 2.25% | 2.25% | 2.25% | 2.25% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 2.93% | (f) | 2.90% | 2.81% | 2.51% | 2.49% | 2.48% | |||||||||||||||||||||
Net investment income (loss) | 0.14% | (f) | 0.59% | 0.48% | 0.34% | (0.02)% | (0.22)% | |||||||||||||||||||||
Portfolio turnover rate(g) | 28% | 62% | 75% | 80% | 82% | 94% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Less than $0.005 per share. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
32 |
Class Z Shares | ||||||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Per Share Operating Performance(a): |
| |||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $14.66 | $12.21 | $13.06 | $11.61 | $11.47 | $12.62 | ||||||||||||||||||||||
Income (loss) from investment operations: |
| |||||||||||||||||||||||||||
Net investment income (loss) | 0.09 | 0.23 | 0.19 | 0.18 | 0.11 | 0.09 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.62 | ) | 2.48 | (0.82 | ) | 1.49 | 0.23 | (1.13 | ) | |||||||||||||||||||
Total from investment operations | (1.53 | ) | 2.71 | (0.63 | ) | 1.67 | 0.34 | (1.04 | ) | |||||||||||||||||||
Less Dividends and Distributions: |
| |||||||||||||||||||||||||||
Dividends from net investment income | (0.07 | ) | (0.25 | ) | (0.22 | ) | (0.14 | ) | (0.09 | ) | (0.08 | ) | ||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | - | (0.08 | ) | (0.11 | ) | (0.03 | ) | ||||||||||||||||||
Total dividends and distributions | (0.07 | ) | (0.26 | ) | (0.22 | ) | (0.22 | ) | (0.20 | ) | (0.11 | ) | ||||||||||||||||
Net asset value, end of period | $13.06 | $14.66 | $12.21 | $13.06 | $11.61 | $11.47 | ||||||||||||||||||||||
Total Return(b): | (10.49)% | 22.30% | (4.94)% | 14.51% | 2.96% | (8.28)% | ||||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||||||
Net assets, end of period (000) | $19,263 | $21,868 | $23,074 | $28,831 | $40,811 | $47,305 | ||||||||||||||||||||||
Average net assets (000) | $21,457 | $21,608 | $27,549 | $29,597 | $40,236 | $42,210 | ||||||||||||||||||||||
Ratios to average net assets(c)(d): |
| |||||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.17% | (e) | 1.17% | 1.25% | 1.25% | 1.25% | 1.25% | |||||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.59% | (e) | 1.57% | 1.52% | 1.51% | 1.49% | 1.48% | |||||||||||||||||||||
Net investment income (loss) | 1.21% | (e) | 1.66% | 1.45% | 1.49% | 0.94% | 0.75% | |||||||||||||||||||||
Portfolio turnover rate(f) | 28% | 62% | 75% | 80% | 82% | 94% |
(a) | Calculated based on average shares outstanding during the period. |
(b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(c) | Does not include expenses of the underlying funds in which the Series invests. |
(d) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Jennison Global Infrastructure Fund | 33 |
Financial Highlights (unaudited)(continued)
Class R6 Shares | ||||||||||||||||||||||||
Six Months Ended April 30, | Year Ended October 31, | December 28, 2016(a) through October 31, | ||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | |||||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $14.66 | $12.21 | $13.06 | $11.39 | ||||||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.09 | 0.23 | 0.18 | 0.11 | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.62 | ) | 2.48 | (0.81 | ) | 1.71 | ||||||||||||||||||
Total from investment operations | (1.53 | ) | 2.71 | (0.63 | ) | 1.82 | ||||||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||||||
Dividends from net investment income | (0.07 | ) | (0.25 | ) | (0.22 | ) | (0.10 | ) | ||||||||||||||||
Tax return of capital distributions | - | (0.01 | ) | - | (0.05 | ) | ||||||||||||||||||
Total dividends and distributions | (0.07 | ) | (0.26 | ) | (0.22 | ) | (0.15 | ) | ||||||||||||||||
Net asset value, end of period | $13.06 | $14.66 | $12.21 | $13.06 | ||||||||||||||||||||
Total Return(c): | (10.49)% | 22.40% | (4.94)% | 16.02% | ||||||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (000) | $8,259 | $11,954 | $13,912 | $21,979 | ||||||||||||||||||||
Average net assets (000) | $11,123 | $13,787 | $17,657 | $19,274 | ||||||||||||||||||||
Ratios to average net assets(d)(e): | ||||||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.17% | (f) | 1.17% | 1.25% | 1.25% | (f) | ||||||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.53% | (f) | 1.48% | 1.44% | 1.40% | (f) | ||||||||||||||||||
Net investment income (loss) | 1.25% | (f) | 1.70% | 1.39% | 1.00% | (f) | ||||||||||||||||||
Portfolio turnover rate(g) | 28% | 62% | 75% | 80% |
(a) | Commencement of offering. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Effective November 1, 2017, class specific expenses include transfer agent fees and expenses and registration fees, which are charged to their respective share class. |
(f) | Annualized. |
(g) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
34 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Jennison Global Infrastructure Fund | 35 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISER | Jennison Associates LLC | 466 Lexington Avenue New York, NY 10017 | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Jennison Global Infrastructure Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM JENNISON GLOBAL INFRASTRUCTURE FUND
SHARE CLASS | A | C | Z | R6 | ||||
NASDAQ | PGJAX | PGJCX | PGJZX | PGJQX | ||||
CUSIP | 743969792 | 743969784 | 743969776 | 743969560 |
MF217E2
PGIM EMERGING MARKETS DEBT HARD
CURRENCY FUND
SEMIANNUAL REPORT
APRIL 30, 2020
COMING SOON: PAPERLESS SHAREHOLDER REPORTS
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (pgiminvestments.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-225-1852 or by sending an email request to PGIM Investments at shareholderreports@pgim.com.
You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary or follow instructions included with this notice to elect to continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 1-800-225-1852 or send an email request to shareholderreports@pgim.com to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.
To enroll in e-delivery, go to pgiminvestments.com/edelivery
3 | ||||
4 | ||||
7 | ||||
9 |
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The information about the Fund’s portfolio holdings is for the period covered by this report and is subject to change thereafter.
The accompanying financial statements as of April 30, 2020 were not audited and, accordingly, no auditor’s opinion is expressed on them.
Mutual funds are distributed by Prudential Investment Management Services LLC (PIMS), member SIPC. PGIM Fixed Income is a unit of PGIM, Inc. (PGIM), a registered investment adviser. PIMS and PGIM are Prudential Financial companies. © 2020 Prudential Financial, Inc. and its related entities. PGIM and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
2 | Visit our website at pgiminvestments.com |
Dear Shareholder:
We hope you find the semiannual report for PGIM Emerging Markets Debt Hard Currency Fund informative and useful. The report covers performance for the six-month period ended April 30, 2020.
Regarding your investments with PGIM, we believe it is important to maintain a diversified portfolio of funds consistent with your tolerance for risk, time horizon, and financial goals.
Your financial advisor can help you create a diversified investment plan that may include funds covering all the basic asset classes and that reflects your personal investor profile and risk tolerance. However, diversification and asset allocation strategies do not assure a profit or protect against loss in declining markets.
At PGIM Investments, we consider it a great privilege and responsibility to help investors participate in opportunities across global markets while meeting their toughest investment challenges. PGIM is a top-10 global investment manager with more than $1 trillion in assets under management. This investment expertise allows us to deliver actively managed funds and strategies to meet the needs of investors around the globe.
Thank you for choosing our family of funds.
Sincerely,
Stuart S. Parker, President
PGIM Emerging Markets Debt Hard Currency Fund
June 15, 2020
PGIM Emerging Markets Debt Hard Currency Fund | 3 |
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at pgiminvestments.com or by calling (800) 225-1852.
Average Annual Total Returns as of 4/30/20 | ||||||
(without sales charges) | (with sales charges) | |||||
Six Months* (%) | One Year (%) | Since Inception (%) | ||||
Class A | –14.60 | –13.39 | –5.66 (12/12/17) | |||
Class C | –14.91 | –11.98 | –5.05 (12/12/17) | |||
Class Z | –14.38 | –10.14 | –4.06 (12/12/17) | |||
Class R6 | –14.34 | –10.07 | –3.98 (12/12/17) | |||
JP Morgan Emerging Markets Bond Global Diversified Index | ||||||
–10.08 | –4.97 | –0.73 |
*Not annualized
Source: PGIM Investments LLC, Lipper Inc. and JP Morgan
Since Inception returns are provided since the Fund has less than 10 fiscal years of returns. Since Inception returns for the Index are measured from the closest month-end to the Fund’s inception date.
4 | Visit our website at pgiminvestments.com |
The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares. The average annual total returns take into account applicable sales charges, which are described for each share class in the table below.
Class A | Class C | Class Z | Class R6 | |||||
Maximum initial sales charge | 3.25% of the public offering price. | None | None | None | ||||
Contingent deferred sales charge (CDSC) (as a percentage of the lower of the original purchase price or the net asset value at redemption) | For purchases on or after July 15, 2019: 1.00% on sales of $500,000 or more made within 12 months of purchase. For purchases prior to July 15, 2019: 1.00% on sales of $1 million or more made within 12 months of purchase. | 1.00% on sales made within 12 months of purchase | None | None | ||||
Annual distribution and service (12b-1) fees (shown as a percentage of average daily net assets) | 0.25% | 1.00% | None | None |
Benchmark Definitions
JP Morgan Emerging Markets Bond Global Diversified Index (EMBI)—The JP Morgan Emerging Markets Bond Global Diversified Index (EMBI) tracks total returns for USD-denominated debt instruments issued by emerging market sovereign and quasi-sovereign entities: Brady bonds, loans, and eurobonds. It limits the weights of those index countries with larger debt stocks by only including specified portions of these countries’ eligible current face amounts of debt outstanding.
Investors cannot invest directly in an index. The returns for the Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes.
PGIM Emerging Markets Debt Hard Currency Fund | 5 |
Your Fund’s Performance (continued)
Credit Quality expressed as a percentage of total investments as of 4/30/20 (%) | ||||
AA | 4.4 | |||
A | 8.7 | |||
BBB | 27.8 | |||
BB | 24.4 | |||
B | 24.4 | |||
CCC | 4.0 | |||
CC | 2.2 | |||
D | 0.1 | |||
Not Rated | 0.7 | |||
Cash/Cash Equivalents | 3.3 | |||
Total | 100.0 |
Source: PGIM Fixed Income
Credit ratings reflect the highest rating assigned by a nationally recognized statistical rating organization (NRSRO) such as Moody’s Investors Service, Inc. (Moody’s), S&P Global Ratings (S&P), or Fitch, Inc. (Fitch). Credit ratings reflect the common nomenclature used by both S&P and Fitch. Where applicable, ratings are converted to the comparable S&P/Fitch rating tier nomenclature. These rating agencies are independent and are widely used. The Not Rated category consists of securities that have not been rated by a NRSRO. Credit ratings are subject to change.
Distributions and Yields as of 4/30/20 | ||||||
Total Distributions Paid for Six Months ($) | SEC 30-Day Subsidized Yield* (%) | SEC 30-Day Unsubsidized Yield** (%) | ||||
Class A | 0.27 | 9.10 | –85.72 | |||
Class C | 0.24 | 8.63 | –106.56 | |||
Class Z | 0.29 | 9.71 | 8.66 | |||
Class R6 | 0.29 | 9.80 | 9.10 |
*SEC 30-Day Subsidized Yield (%)—A standardized yield calculation created by the Securities and Exchange Commission, it reflects the income earned during a 30-day period, after the deduction of the Fund’s net expenses (net of any expense waivers or reimbursements). The investor experience is represented by the SEC 30-Day Subsidized Yield.
**SEC 30-Day Unsubsidized Yield (%)—A standardized yield calculation created by the Securities and Exchange Commission, it reflects the income earned during a 30-day period, after the deduction of the Fund’s gross expenses. The investor experience is represented by the SEC 30-Day Subsidized Yield.
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As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution, and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 held through the six-month period ended April 30, 2020. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of PGIM funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period
PGIM Emerging Markets Debt Hard Currency Fund | 7 |
Fees and Expenses (continued)
and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
PGIM Emerging Markets Debt Hard Currency Fund | Beginning Account Value November 1, 2019 | Ending Account April 30, 2020 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||||||
Class A | Actual | $ | 1,000.00 | $ | 854.00 | 1.05 | % | $ | 4.84 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,019.64 | 1.05 | % | $ | 5.27 | ||||||||||
Class C | Actual | $ | 1,000.00 | $ | 850.90 | 1.80 | % | $ | 8.28 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,015.91 | 1.80 | % | $ | 9.02 | ||||||||||
Class Z | Actual | $ | 1,000.00 | $ | 856.20 | 0.76 | % | $ | 3.51 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,021.08 | 0.76 | % | $ | 3.82 | ||||||||||
Class R6 | Actual | $ | 1,000.00 | $ | 856.60 | 0.67 | % | $ | 3.09 | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,021.53 | 0.67 | % | $ | 3.37 |
*Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended April 30, 2020, and divided by the 366 days in the Fund’s fiscal year ending October 31, 2020 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
8 | Visit our website at pgiminvestments.com |
Schedule of Investments (unaudited)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
LONG-TERM INVESTMENTS 94.5% |
| |||||||||||||||
CORPORATE BONDS 22.8% |
| |||||||||||||||
Argentina 0.2% |
| |||||||||||||||
YPF SA, | 8.500 | % | 07/28/25 | 155 | $ | 74,708 | ||||||||||
Azerbaijan 0.7% |
| |||||||||||||||
State Oil Co. of the Azerbaijan Republic, | 6.950 | 03/18/30 | 200 | 210,303 | ||||||||||||
Brazil 1.3% |
| |||||||||||||||
Petrobras Global Finance BV, | ||||||||||||||||
Gtd. Notes | 5.999 | 01/27/28 | 95 | 91,838 | ||||||||||||
Gtd. Notes | 6.900 | 03/19/49 | 140 | 135,519 | ||||||||||||
Gtd. Notes | 7.375 | 01/17/27 | 18 | 18,985 | ||||||||||||
Gtd. Notes | 8.750 | 05/23/26 | 87 | 96,761 | ||||||||||||
Gtd. Notes, 144A | 5.093 | 01/15/30 | 67 | 60,987 | ||||||||||||
|
| |||||||||||||||
404,090 | ||||||||||||||||
Chile 0.7% |
| |||||||||||||||
Corp Nacional del Cobre de Chile, | 4.875 | 11/04/44 | 200 | 213,692 | ||||||||||||
China 2.7% |
| |||||||||||||||
CNAC HK Finbridge Co. Ltd., | 4.875 | 03/14/25 | 240 | 255,795 | ||||||||||||
Country Garden Holdings Co. Ltd., | 8.000 | 01/27/24 | 200 | 211,720 | ||||||||||||
Sinochem Overseas Capital Co. Ltd., | 6.300 | 11/12/40 | 130 | 180,772 | ||||||||||||
Sinopec Group Overseas Development 2018 Ltd., | 3.680 | 08/08/49 | 200 | 214,222 | ||||||||||||
|
| |||||||||||||||
862,509 | ||||||||||||||||
India 0.5% |
| |||||||||||||||
HPCL-Mittal Energy Ltd., | 5.250 | 04/28/27 | 200 | 170,329 | ||||||||||||
Indonesia 2.0% |
| |||||||||||||||
Pelabuhan Indonesia III Persero PT, | 4.875 | 10/01/24 | 200 | 203,457 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 9 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
CORPORATE BONDS (Continued) |
| |||||||||||||||
Indonesia (cont’d.) |
| |||||||||||||||
Pertamina Persero PT, | 6.000 | % | 05/03/42 | 200 | $ | 213,418 | ||||||||||
Saka Energi Indonesia PT, | 4.450 | 05/05/24 | 250 | 216,250 | ||||||||||||
|
| |||||||||||||||
633,125 | ||||||||||||||||
Kazakhstan 1.4% |
| |||||||||||||||
Kazakhstan Temir Zholy Finance BV, | 6.950 | 07/10/42 | 200 | 231,426 | ||||||||||||
KazMunayGas National Co. JSC, | 5.750 | 04/19/47 | 200 | 199,475 | ||||||||||||
|
| |||||||||||||||
430,901 | ||||||||||||||||
Malaysia 1.7% |
| |||||||||||||||
Petroliam Nasional Bhd, | 7.625 | 10/15/26 | 250 | 318,865 | ||||||||||||
Petronas Capital Ltd., | 4.550 | 04/21/50 | 200 | 217,498 | ||||||||||||
|
| |||||||||||||||
536,363 | ||||||||||||||||
Mexico 4.9% |
| |||||||||||||||
Mexico City Airport Trust, | 4.250 | 10/31/26 | 200 | 179,850 | ||||||||||||
Nemak SAB de CV, | 4.750 | 01/23/25 | 200 | 171,343 | ||||||||||||
Orbia Advance Corp. SAB de CV, | 5.500 | 01/15/48 | 200 | 185,912 | ||||||||||||
Petroleos Mexicanos, | ||||||||||||||||
Gtd. Notes | 6.350 | 02/12/48 | 50 | 33,524 | ||||||||||||
Gtd. Notes | 6.500 | 03/13/27 | 325 | 263,539 | ||||||||||||
Gtd. Notes | 6.500 | 01/23/29 | 65 | 50,824 | ||||||||||||
Gtd. Notes | 6.500 | 06/02/41 | 435 | 293,582 | ||||||||||||
Gtd. Notes, 144A | 5.950 | 01/28/31 | 75 | 54,580 | ||||||||||||
Gtd. Notes, 144A | 6.490 | 01/23/27 | 20 | 16,257 | ||||||||||||
Gtd. Notes, 144A | 6.840 | 01/23/30 | 143 | 111,883 | ||||||||||||
Gtd. Notes, 144A | 7.690 | 01/23/50 | 75 | 55,020 | ||||||||||||
Gtd. Notes, MTN | 6.875 | 08/04/26 | 160 | 132,506 | ||||||||||||
|
| |||||||||||||||
1,548,820 |
See Notes to Financial Statements.
10 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
CORPORATE BONDS (Continued) | ||||||||||||||||||||
Russia 2.0% | ||||||||||||||||||||
Gazprom PJSC Via Gaz Capital SA, | ||||||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 7.288 | % | 08/16/37 | 100 | $ | 137,476 | ||||||||||||||
Sr. Unsec’d. Notes, EMTN | 8.625 | 04/28/34 | 325 | 479,609 | ||||||||||||||||
|
| |||||||||||||||||||
617,085 | ||||||||||||||||||||
Saudi Arabia 0.7% | ||||||||||||||||||||
Saudi Arabian Oil Co., | 4.250 | 04/16/39 | 200 | 206,133 | ||||||||||||||||
South Africa 2.0% | ||||||||||||||||||||
Eskom Holdings SOC Ltd., | ||||||||||||||||||||
Gov’t. Gtd. Notes, MTN | 6.350 | 08/10/28 | 200 | 178,760 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.125 | 02/11/25 | 200 | 146,100 | ||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.750 | 08/06/23 | 200 | 149,218 | ||||||||||||||||
Sr. Unsec’d. Notes, MTN | 8.450 | 08/10/28 | 200 | 140,987 | ||||||||||||||||
|
| |||||||||||||||||||
615,065 | ||||||||||||||||||||
Trinidad & Tobago 0.3% | ||||||||||||||||||||
Trinidad Petroleum Holdings Ltd., | 9.750 | 06/15/26 | 91 | 81,699 | ||||||||||||||||
Tunisia 0.7% | ||||||||||||||||||||
Banque Centrale de Tunisie International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.625 | 02/17/24 | EUR | 140 | 127,034 | |||||||||||||||
Sr. Unsec’d. Notes | 6.750 | 10/31/23 | EUR | 100 | 94,140 | |||||||||||||||
|
| |||||||||||||||||||
221,174 | ||||||||||||||||||||
Ukraine 0.3% | ||||||||||||||||||||
NAK Naftogaz Ukraine via Kondor Finance PLC, | 7.125 | 07/19/24 | EUR | 100 | 95,523 | |||||||||||||||
United States 0.6% | ||||||||||||||||||||
JBS Investments II GmbH, | 5.750 | 01/15/28 | 200 | 195,328 | ||||||||||||||||
Venezuela 0.1% | ||||||||||||||||||||
Petroleos de Venezuela SA, | ||||||||||||||||||||
First Lien | 8.500 | 10/27/20 | 205 | 26,137 | ||||||||||||||||
Sr. Unsec’d. Notes | 5.375 | 04/12/27 | (d) | 205 | 7,687 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 11 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
CORPORATE BONDS (Continued) | ||||||||||||||||||||
Venezuela (cont’d.) | ||||||||||||||||||||
Petroleos de Venezuela SA, (cont’d.) | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.000 | % | 05/16/24 | (d) | 45 | $ | 1,688 | |||||||||||||
Sr. Unsec’d. Notes | 6.000 | 11/15/26 | (d) | 65 | 2,438 | |||||||||||||||
|
| |||||||||||||||||||
37,950 | ||||||||||||||||||||
|
| |||||||||||||||||||
TOTAL CORPORATE BONDS | 7,154,797 | |||||||||||||||||||
|
| |||||||||||||||||||
SOVEREIGN BONDS 71.7% | ||||||||||||||||||||
Angola 1.2% | ||||||||||||||||||||
Angolan Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 8.250 | 05/09/28 | 200 | 87,507 | ||||||||||||||||
Sr. Unsec’d. Notes | 9.500 | 11/12/25 | 400 | 189,897 | ||||||||||||||||
Sr. Unsec’d. Notes, 144A | 9.375 | 05/08/48 | 200 | 85,691 | ||||||||||||||||
|
| |||||||||||||||||||
363,095 | ||||||||||||||||||||
Argentina 1.8% | ||||||||||||||||||||
Argentine Republic Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 3.375 | 01/15/23 | EUR | 200 | 55,037 | |||||||||||||||
Sr. Unsec’d. Notes | 3.380 | (cc) | 12/31/38 | EUR | 70 | 20,183 | ||||||||||||||
Sr. Unsec’d. Notes | 3.750 | (cc) | 12/31/38 | 110 | 34,682 | |||||||||||||||
Sr. Unsec’d. Notes | 4.625 | 01/11/23 | 40 | 11,204 | ||||||||||||||||
Sr. Unsec’d. Notes | 5.625 | 01/26/22 | 80 | 22,400 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.875 | 04/22/21 | 390 | 112,365 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.875 | 01/11/48 | 30 | 7,042 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.820 | 12/31/33 | EUR | 138 | 49,004 | |||||||||||||||
Sr. Unsec’d. Notes | 7.820 | 12/31/33 | EUR | 179 | 61,972 | |||||||||||||||
Sr. Unsec’d. Notes | 8.280 | 12/31/33 | 210 | 73,753 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.280 | 12/31/33 | 42 | 14,347 | ||||||||||||||||
Provincia de Buenos Aires, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.375 | 01/20/23 | EUR | 100 | 28,364 | |||||||||||||||
Sr. Unsec’d. Notes, 144A | 9.125 | 03/16/24 | 245 | 67,448 | ||||||||||||||||
|
| |||||||||||||||||||
557,801 | ||||||||||||||||||||
Bahrain 2.5% | ||||||||||||||||||||
Bahrain Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.750 | 09/20/29 | 200 | 193,752 |
See Notes to Financial Statements.
12 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Bahrain (cont’d.) | ||||||||||||||||||||
Bahrain Government International Bond, (cont’d.) | ||||||||||||||||||||
Sr. Unsec’d. Notes | 7.000 | % | 01/26/26 | 400 | $ | 399,700 | ||||||||||||||
Sr. Unsec’d. Notes | 7.500 | 09/20/47 | 200 | 189,902 | ||||||||||||||||
|
| |||||||||||||||||||
783,354 | ||||||||||||||||||||
Brazil 2.6% | ||||||||||||||||||||
Brazil Minas SPE via State of Minas Gerais, | 5.333 | 02/15/28 | 228 | 227,912 | ||||||||||||||||
Brazilian Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.625 | 01/07/41 | 120 | 119,410 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.125 | 01/20/37 | 200 | 226,019 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.250 | 01/20/34 | 205 | 250,623 | ||||||||||||||||
|
| |||||||||||||||||||
823,964 | ||||||||||||||||||||
Colombia 2.0% | ||||||||||||||||||||
Colombia Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.125 | 01/18/41 | 135 | 150,472 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.375 | 09/18/37 | 375 | 462,037 | ||||||||||||||||
|
| |||||||||||||||||||
612,509 | ||||||||||||||||||||
Congo (Republic) 0.2% | ||||||||||||||||||||
Congolese International Bond, | 6.000 | 06/30/29 | 90 | 70,074 | ||||||||||||||||
Costa Rica 1.0% | ||||||||||||||||||||
Costa Rica Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 4.375 | 04/30/25 | 200 | 165,828 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.158 | 03/12/45 | 200 | 155,045 | ||||||||||||||||
|
| |||||||||||||||||||
320,873 | ||||||||||||||||||||
Croatia 0.4% | ||||||||||||||||||||
Croatia Government International Bond, | 2.750 | 01/27/30 | EUR | 100 | 116,198 | |||||||||||||||
Dominican Republic 2.5% | ||||||||||||||||||||
Dominican Republic International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.875 | 04/18/24 | 305 | 294,764 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 13 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Dominican Republic (cont’d.) | ||||||||||||||||||||
Dominican Republic International Bond, (cont’d.) | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.875 | % | 01/29/26 | 100 | $ | 96,043 | ||||||||||||||
Sr. Unsec’d. Notes | 7.450 | 04/30/44 | 440 | 397,623 | ||||||||||||||||
|
| |||||||||||||||||||
788,430 | ||||||||||||||||||||
Ecuador 0.9% | ||||||||||||||||||||
Ecuador Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 8.750 | 06/02/23 | 400 | 124,392 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.875 | 10/23/27 | 500 | 142,500 | ||||||||||||||||
|
| |||||||||||||||||||
266,892 | ||||||||||||||||||||
Egypt 2.5% | ||||||||||||||||||||
Egypt Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes, 144A, MTN | 6.375 | 04/11/31 | EUR | 200 | 184,141 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 4.750 | 04/16/26 | EUR | 200 | 186,290 | |||||||||||||||
Sr. Unsec’d. Notes, MTN | 7.500 | 01/31/27 | 200 | 195,229 | ||||||||||||||||
Sr. Unsec’d. Notes, MTN | 8.500 | 01/31/47 | 250 | 223,517 | ||||||||||||||||
|
| |||||||||||||||||||
789,177 | ||||||||||||||||||||
El Salvador 1.3% | ||||||||||||||||||||
El Salvador Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.375 | 01/18/27 | 325 | 258,343 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.650 | 06/15/35 | 85 | 67,299 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 01/24/23 | 45 | 38,759 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.250 | 04/10/32 | 45 | 36,677 | ||||||||||||||||
|
| |||||||||||||||||||
401,078 | ||||||||||||||||||||
Gabon 0.5% | ||||||||||||||||||||
Gabon Government International Bond, Bonds | 6.375 | 12/12/24 | 200 | 144,080 | ||||||||||||||||
Ghana 2.1% | ||||||||||||||||||||
Ghana Government International Bond, Bank Gtd. Notes | 10.750 | 10/14/30 | 200 | 207,842 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.875 | 03/26/27 | 200 | 159,594 | ||||||||||||||||
Sr. Unsec’d. Notes, 144A | 6.375 | 02/11/27 | 200 | 154,610 | ||||||||||||||||
Sr. Unsec’d. Notes, 144A | 7.875 | 02/11/35 | 200 | 150,512 | ||||||||||||||||
|
| |||||||||||||||||||
672,558 |
See Notes to Financial Statements.
14 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Greece 0.8% | ||||||||||||||||||||
Hellenic Republic Government Bond, Bonds | 3.650 | %(cc) | 02/24/37 | EUR | 200 | $ | 262,623 | |||||||||||||
Guatemala 0.6% | ||||||||||||||||||||
Guatemala Government Bond, | 4.875 | 02/13/28 | 200 | 200,768 | ||||||||||||||||
Honduras 0.6% | ||||||||||||||||||||
Honduras Government International Bond, | 7.500 | 03/15/24 | 200 | 192,104 | ||||||||||||||||
Hungary 0.8% | ||||||||||||||||||||
Hungary Government International Bond, | 7.625 | 03/29/41 | 162 | 259,740 | ||||||||||||||||
India 0.6% | ||||||||||||||||||||
Export-Import Bank of India, | 3.250 | 01/15/30 | 200 | 183,201 | ||||||||||||||||
Indonesia 3.2% | ||||||||||||||||||||
Indonesia Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 1.450 | 09/18/26 | EUR | 100 | 102,136 | |||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 01/17/38 | 160 | 224,512 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.500 | 10/12/35 | 150 | 216,900 | ||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 3.750 | 06/14/28 | EUR | 100 | 117,256 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 4.625 | 04/15/43 | 200 | 213,112 | ||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.750 | 01/15/44 | 100 | 134,401 | ||||||||||||||||
|
| |||||||||||||||||||
1,008,317 | ||||||||||||||||||||
Iraq 1.1% | ||||||||||||||||||||
Iraq International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.800 | 01/15/28 | 250 | 181,997 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.752 | 03/09/23 | 200 | 151,401 | ||||||||||||||||
|
| |||||||||||||||||||
333,398 | ||||||||||||||||||||
Israel 0.7% | ||||||||||||||||||||
Israel Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 3.875 | 07/03/50 | 200 | 220,816 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 15 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Ivory Coast 1.2% | ||||||||||||||||||||
Ivory Coast Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.750 | % | 12/31/32 | 128 | $ | 111,687 | ||||||||||||||
Sr. Unsec’d. Notes | 6.375 | 03/03/28 | 200 | 179,862 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.625 | 03/22/48 | EUR | 100 | 87,582 | |||||||||||||||
|
| |||||||||||||||||||
379,131 | ||||||||||||||||||||
Jamaica 1.1% | ||||||||||||||||||||
Jamaica Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 7.625 | 07/09/25 | 225 | 233,566 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.000 | 03/15/39 | 100 | 105,668 | ||||||||||||||||
|
| |||||||||||||||||||
339,234 | ||||||||||||||||||||
Jordan 0.6% | ||||||||||||||||||||
Jordan Government International Bond, | 7.375 | 10/10/47 | 200 | 184,672 | ||||||||||||||||
Kazakhstan 0.8% | ||||||||||||||||||||
Kazakhstan Government International Bond, | 6.500 | 07/21/45 | 200 | 264,206 | ||||||||||||||||
Kenya 1.2% | ||||||||||||||||||||
Kenya Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.875 | 06/24/24 | 200 | 183,904 | ||||||||||||||||
Sr. Unsec’d. Notes | 8.250 | 02/28/48 | 200 | 179,791 | ||||||||||||||||
|
| |||||||||||||||||||
363,695 | ||||||||||||||||||||
Lebanon 0.5% | ||||||||||||||||||||
Lebanon Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.000 | 01/27/23 | (d) | 102 | 16,428 | |||||||||||||||
Sr. Unsec’d. Notes | 6.650 | 04/22/24 | (d) | 52 | 8,385 | |||||||||||||||
Sr. Unsec’d. Notes | 6.750 | 11/29/27 | (d) | 20 | 3,200 | |||||||||||||||
Sr. Unsec’d. Notes | 7.000 | 04/22/31 | (d) | 35 | 5,600 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.100 | 10/04/22 | (d) | 65 | 10,646 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.850 | 05/25/29 | (d) | 140 | 22,467 | |||||||||||||||
Sr. Unsec’d. Notes, GMTN | 6.250 | 05/27/22 | (d) | 115 | 18,779 | |||||||||||||||
Sr. Unsec’d. Notes, GMTN | 6.400 | 05/26/23 | (d) | 150 | 24,624 | |||||||||||||||
Sr. Unsec’d. Notes, GMTN | 6.650 | 02/26/30 | (d) | 285 | 45,600 | |||||||||||||||
|
| |||||||||||||||||||
155,729 |
See Notes to Financial Statements.
16 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Luxembourg 0.2% | ||||||||||||||||
Ecuador Social Bond Sarl, | 4.573 | %(s) | 01/30/35 | 200 | $ | 60,000 | ||||||||||
Mexico 0.7% | ||||||||||||||||
Mexico Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes, GMTN | 5.750 | 10/12/2110 | 126 | 119,641 | ||||||||||||
Sr. Unsec’d. Notes, MTN | 6.050 | 01/11/40 | 82 | 88,990 | ||||||||||||
|
| |||||||||||||||
208,631 | ||||||||||||||||
Mongolia 0.6% | ||||||||||||||||
Mongolia Government International Bond, | 5.125 | 12/05/22 | 200 | 177,992 | ||||||||||||
Mozambique 0.4% | ||||||||||||||||
Mozambique International Bond, | 5.000 | 09/15/31 | 200 | 138,074 | ||||||||||||
Namibia 0.6% | ||||||||||||||||
Namibia International Bonds, | 5.250 | 10/29/25 | 200 | 182,158 | ||||||||||||
Nigeria 2.0% | ||||||||||||||||
Nigeria Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 7.625 | 11/21/25 | 200 | 167,119 | ||||||||||||
Sr. Unsec’d. Notes | 8.747 | 01/21/31 | 400 | 321,106 | ||||||||||||
Sr. Unsec’d. Notes, 144A | 7.696 | 02/23/38 | 200 | 147,205 | ||||||||||||
|
| |||||||||||||||
635,430 | ||||||||||||||||
Oman 1.4% | ||||||||||||||||
Oman Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 4.750 | 06/15/26 | 200 | 153,074 | ||||||||||||
Sr. Unsec’d. Notes | 6.500 | 03/08/47 | 225 | 158,288 | ||||||||||||
Sr. Unsec’d. Notes, 144A | 6.750 | 01/17/48 | 200 | 141,554 | ||||||||||||
|
| |||||||||||||||
452,916 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 17 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Pakistan 1.7% | ||||||||||||||||
Pakistan Government International Bond, | 8.250 | % | 09/30/25 | 370 | $ | 344,045 | ||||||||||
Third Pakistan International Sukuk Co. Ltd. (The), | 5.625 | �� | 12/05/22 | 200 | 184,454 | |||||||||||
|
| |||||||||||||||
528,499 | ||||||||||||||||
Panama 1.7% | ||||||||||||||||
Panama Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 6.700 | 01/26/36 | 295 | 387,554 | ||||||||||||
Sr. Unsec’d. Notes | 9.375 | 04/01/29 | 105 | 147,156 | ||||||||||||
|
| |||||||||||||||
534,710 | ||||||||||||||||
Papua New Guinea 0.6% | ||||||||||||||||
Papua New Guinea Government International Bond, | 8.375 | 10/04/28 | 200 | 176,673 | ||||||||||||
Peru 2.0% | ||||||||||||||||
Peruvian Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 2.783 | 01/23/31 | 30 | 30,944 | ||||||||||||
Sr. Unsec’d. Notes | 5.625 | 11/18/50 | 50 | 74,301 | ||||||||||||
Sr. Unsec’d. Notes | 6.550 | 03/14/37 | 75 | 107,749 | ||||||||||||
Sr. Unsec’d. Notes | 8.750 | 11/21/33 | 265 | 418,509 | ||||||||||||
|
| |||||||||||||||
631,503 | ||||||||||||||||
Philippines 2.0% | ||||||||||||||||
Philippine Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 2.950 | 05/05/45 | 200 | 205,633 | ||||||||||||
Sr. Unsec’d. Notes | 6.375 | 10/23/34 | 100 | 142,340 | ||||||||||||
Sr. Unsec’d. Notes | 7.750 | 01/14/31 | 200 | 293,762 | ||||||||||||
|
| |||||||||||||||
641,735 | ||||||||||||||||
Qatar 2.4% | ||||||||||||||||
Qatar Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 5.103 | 04/23/48 | 400 | 497,321 | ||||||||||||
Sr. Unsec’d. Notes, 144A | 4.817 | 03/14/49 | 205 | 245,901 | ||||||||||||
|
| |||||||||||||||
743,222 |
See Notes to Financial Statements.
18 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Romania 1.5% | ||||||||||||||||||||
Romanian Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.125 | % | 06/15/48 | 86 | $ | 90,732 | ||||||||||||||
Sr. Unsec’d. Notes, 144A | 5.125 | 06/15/48 | 44 | 46,421 | ||||||||||||||||
Sr. Unsec’d. Notes, 144A, MTN | 3.375 | 01/28/50 | EUR | 17 | 15,876 | |||||||||||||||
Sr. Unsec’d. Notes, 144A, MTN | 4.625 | 04/03/49 | EUR | 23 | 25,415 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 4.125 | 03/11/39 | EUR | 98 | 105,232 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 4.625 | 04/03/49 | EUR | 20 | 22,100 | |||||||||||||||
Sr. Unsec’d. Notes, EMTN | 6.125 | 01/22/44 | 142 | 168,094 | ||||||||||||||||
|
| |||||||||||||||||||
473,870 | ||||||||||||||||||||
Russia 1.7% | ||||||||||||||||||||
Russian Foreign Bond - Eurobond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.625 | 04/04/42 | 200 | 253,007 | ||||||||||||||||
Sr. Unsec’d. Notes | 12.750 | 06/24/28 | 160 | 268,935 | ||||||||||||||||
|
| |||||||||||||||||||
521,942 | ||||||||||||||||||||
Saudi Arabia 1.4% | ||||||||||||||||||||
Saudi Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes, 144A | 5.250 | 01/16/50 | 200 | 225,553 | ||||||||||||||||
Sr. Unsec’d. Notes, EMTN | 5.000 | 04/17/49 | 200 | 219,612 | ||||||||||||||||
|
| |||||||||||||||||||
445,165 | ||||||||||||||||||||
Senegal 0.5% | ||||||||||||||||||||
Senegal Government International Bond, | 6.750 | 03/13/48 | 205 | 170,520 | ||||||||||||||||
South Africa 1.7% | ||||||||||||||||||||
Republic of South Africa Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 4.875 | 04/14/26 | 200 | 185,786 | ||||||||||||||||
Sr. Unsec’d. Notes | 5.750 | 09/30/49 | 200 | 155,626 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.250 | 03/08/41 | 230 | 201,902 | ||||||||||||||||
|
| |||||||||||||||||||
543,314 | ||||||||||||||||||||
Sri Lanka 2.2% | ||||||||||||||||||||
Sri Lanka Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 5.750 | 01/18/22 | 200 | 125,998 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.200 | 05/11/27 | 200 | 114,443 |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 19 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||||||
Sri Lanka (cont’d.) | ||||||||||||||||||||
Sri Lanka Government International Bond, (cont’d.) | ||||||||||||||||||||
Sr. Unsec’d. Notes | 6.350 | % | 06/28/24 | 200 | $ | 120,163 | ||||||||||||||
Sr. Unsec’d. Notes | 6.850 | 11/03/25 | 550 | 317,226 | ||||||||||||||||
|
| |||||||||||||||||||
677,830 | ||||||||||||||||||||
Turkey 3.4% | ||||||||||||||||||||
Turkey Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 4.250 | 04/14/26 | 200 | 172,481 | ||||||||||||||||
Sr. Unsec’d. Notes | 5.600 | 11/14/24 | 320 | 304,752 | ||||||||||||||||
Sr. Unsec’d. Notes | 5.750 | 05/11/47 | 200 | 151,293 | ||||||||||||||||
Sr. Unsec’d. Notes | 6.000 | 01/14/41 | 200 | 160,367 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.375 | 02/05/25 | 20 | 20,361 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.625 | 04/26/29 | 80 | 78,912 | ||||||||||||||||
Turkiye Ihracat Kredi Bankasi A/S, | 5.375 | 10/24/23 | 200 | 190,852 | ||||||||||||||||
|
| |||||||||||||||||||
1,079,018 | ||||||||||||||||||||
Ukraine 4.0% | ||||||||||||||||||||
Ukraine Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 0.000 | (cc) | 05/31/40 | 71 | 52,239 | |||||||||||||||
Sr. Unsec’d. Notes | 6.750 | 06/20/26 | EUR | 100 | 97,114 | |||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 09/01/21 | 100 | 96,425 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 09/01/25 | 215 | 200,837 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 09/01/26 | 350 | 323,804 | ||||||||||||||||
Sr. Unsec’d. Notes | 7.750 | 09/01/27 | 100 | 91,887 | ||||||||||||||||
Sr. Unsec’d. Notes | 9.750 | 11/01/28 | 200 | 196,466 | ||||||||||||||||
Ukreximbank Via Biz Finance PLC, | 9.750 | 01/22/25 | 200 | 194,281 | ||||||||||||||||
|
| |||||||||||||||||||
1,253,053 | ||||||||||||||||||||
United Arab Emirates 1.9% | ||||||||||||||||||||
Abu Dhabi Government International Bond, | ||||||||||||||||||||
Sr. Unsec’d. Notes | 3.125 | 09/30/49 | 200 | 190,965 | ||||||||||||||||
Sr. Unsec’d. Notes, 144A, MTN | 3.875 | 04/16/50 | 200 | 212,293 | ||||||||||||||||
Emirate of Dubai Government International Bonds, | 5.250 | 01/30/43 | 200 | 197,465 | ||||||||||||||||
|
| |||||||||||||||||||
600,723 |
See Notes to Financial Statements.
20 |
Description | Interest Rate | Maturity Date | Principal Amount (000)# | Value | ||||||||||||
SOVEREIGN BONDS (Continued) | ||||||||||||||||
Uruguay 1.6% | ||||||||||||||||
Uruguay Government International Bond, | ||||||||||||||||
Sr. Unsec’d. Notes | 4.125 | % | 11/20/45 | 40 | $ | 41,040 | ||||||||||
Sr. Unsec’d. Notes | 4.975 | 04/20/55 | 55 | 62,155 | ||||||||||||
Sr. Unsec’d. Notes | 5.100 | 06/18/50 | 120 | 136,118 | ||||||||||||
Sr. Unsec’d. Notes | 7.625 | 03/21/36 | 185 | 257,166 | ||||||||||||
|
| |||||||||||||||
496,479 | ||||||||||||||||
Venezuela 0.0% | ||||||||||||||||
Venezuela Government International Bond, | 12.750 | 08/23/22 | (d) | 180 | 15,680 | |||||||||||
|
| |||||||||||||||
Zambia 0.2% | ||||||||||||||||
Zambia Government International Bond, | 8.500 | 04/14/24 | 200 | 65,535 | ||||||||||||
|
| |||||||||||||||
TOTAL SOVEREIGN BONDS | 22,512,389 | |||||||||||||||
|
| |||||||||||||||
TOTAL LONG-TERM INVESTMENTS | 29,667,186 | |||||||||||||||
|
| |||||||||||||||
Shares | ||||||||||||||||
SHORT-TERM INVESTMENT 3.5% | ||||||||||||||||
AFFILIATED MUTUAL FUND | ||||||||||||||||
PGIM Core Ultra Short Bond Fund | 1,094,963 | 1,094,963 | ||||||||||||||
|
| |||||||||||||||
TOTAL INVESTMENTS 98.0% | 30,762,149 | |||||||||||||||
|
| |||||||||||||||
Other assets in excess of liabilities(z) 2.0% | 611,973 | |||||||||||||||
|
| |||||||||||||||
NET ASSETS 100.0% | $ | 31,374,122 | ||||||||||||||
|
|
Below is a list of the abbreviation(s) used in the semiannual report: AUD—Australian Dollar
BRL—Brazilian Real
CAD—Canadian Dollar
CLP—Chilean Peso
CNH—Chinese Renminbi
COP—Colombian Peso
CZK—Czech Koruna
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 21 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
EGP—Egyptian Pound
EUR—Euro
HUF—Hungarian Forint
IDR—Indonesian Rupiah
ILS—Israeli Shekel
INR—Indian Rupee
JPY—Japanese Yen
KRW—South Korean Won
KZT—Kazakhstani Tenge
MXN—Mexican Peso
NZD—New Zealand Dollar
PEN—Peruvian Nuevo Sol
PHP—Philippine Peso
PLN—Polish Zloty
RUB—Russian Ruble
SGD—Singapore Dollar
THB—Thai Baht
TRY—Turkish Lira
TWD—New Taiwanese Dollar
ZAR—South African Rand
144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and, pursuant to the requirements of Rule 144A, may not be resold except to qualified institutional buyers.
EMTN—Euro Medium Term Note
GMTN—Global Medium Term Note
LIBOR—London Interbank Offered Rate
MTN—Medium Term Note
OTC—Over-the-counter
PJSC—Public Joint-Stock Company
# | Principal amount is shown in U.S. dollars unless otherwise stated. |
(cc) | Variable rate instrument. The rate shown is based on the latest available information as of April 30, 2020. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description. |
(d) | Represents issuer in default on interest payments and/or principal repayment. Non-income producing security. Such securities may be post-maturity. |
(s) | Represents zero coupon bond or principal only security. Rate represents yield to maturity at purchase date. |
(w) | PGIM Investments LLC, the manager of the Series, also serves as manager of the PGIM Core Ultra Short Bond Fund. |
(z) | Includes net unrealized appreciation/(depreciation) and/or market value of the below holdings which are excluded from the Schedule of Investments: |
Futures contracts outstanding at April 30, 2020:
Number of Contracts | Type | Expiration Date | Current Notional Amount | Value / Unrealized Appreciation (Depreciation) | ||||||||||||
Short Positions: | ||||||||||||||||
6 | 10 Year Euro-Bund | Jun. 2020 | $ | 1,146,895 | $ | (17,100 | ) | |||||||||
4 | 20 Year U.S. Treasury Bonds | Jun. 2020 | 724,125 | (7,674 | ) | |||||||||||
|
| |||||||||||||||
$ | (24,774 | ) | ||||||||||||||
|
|
See Notes to Financial Statements.
22 |
Forward foreign currency exchange contracts outstanding at April 30, 2020:
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts: |
| |||||||||||||||||||||||||
Brazilian Real, | ||||||||||||||||||||||||||
Expiring 05/05/20 | Goldman Sachs International | BRL | 509 | $ | 91,393 | $ | 93,646 | $ | 2,253 | $ | — | |||||||||||||||
Expiring 05/05/20 | HSBC Bank USA, N.A. | BRL | 665 | 117,405 | 122,177 | 4,772 | — | |||||||||||||||||||
Expiring 05/05/20 | Morgan Stanley & Co. International PLC | BRL | 685 | 121,353 | 125,940 | 4,587 | — | |||||||||||||||||||
Chinese Renminbi, | ||||||||||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,370 | 195,565 | 193,507 | — | (2,058) | |||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,080 | 152,000 | 152,491 | 491 | — | |||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 864 | 122,000 | 122,046 | 46 | — | |||||||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 1,343 | 193,000 | 189,707 | — | (3,293) | |||||||||||||||||||
Expiring 05/14/21 | Citibank, N.A. | CNH | 994 | 142,393 | 138,905 | — | (3,488) | |||||||||||||||||||
Egyptian Pound, | ||||||||||||||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 183 | 11,241 | 11,556 | 315 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 649 | 39,692 | 40,419 | 727 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 187 | 11,478 | 11,672 | 194 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 66 | 3,960 | 4,086 | 126 | — | |||||||||||||||||||
Hungarian Forint, | ||||||||||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | HUF | 26,742 | 83,000 | 83,048 | 48 | — | |||||||||||||||||||
Expiring 07/17/20 | BNP Paribas S.A. | HUF | 19,814 | 60,000 | 61,534 | 1,534 | — | |||||||||||||||||||
Expiring 07/17/20 | Citibank, N.A. | HUF | 19,667 | 61,000 | 61,078 | 78 | — | |||||||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | HUF | 10,079 | 30,387 | 31,302 | 915 | — | |||||||||||||||||||
Indian Rupee, | ||||||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | INR | 7,854 | 101,000 | 103,440 | 2,440 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 8,887 | 116,000 | 117,056 | 1,056 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 8,228 | 106,000 | 109,022 | 3,022 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 7,647 | 98,000 | 101,319 | 3,319 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 7,089 | 91,000 | 93,370 | 2,370 | — | |||||||||||||||||||
Expiring 06/17/20 | The Toronto-Dominion Bank | INR | 4,723 | 64,753 | 62,213 | — | (2,540) | |||||||||||||||||||
Indonesian Rupiah, | ||||||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 809,937 | 56,348 | 52,949 | — | (3,399) | |||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 663,864 | 46,682 | 43,399 | — | (3,283) | |||||||||||||||||||
Expiring 06/17/20 | Credit Suisse International | IDR | 2,031,946 | 140,863 | 132,836 | — | (8,027) | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | IDR | 1,747,021 | 112,000 | 114,210 | 2,210 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | IDR | 539,571 | 36,544 | 35,274 | — | (1,270) | |||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | IDR | 969,926 | 67,851 | 63,408 | — | (4,443) | |||||||||||||||||||
Israeli Shekel, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 376 | 105,000 | 108,041 | 3,041 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 286 | 79,000 | 82,291 | 3,291 | — | |||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | ILS | 178 | 50,749 | 51,100 | 351 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 284 | 81,000 | 81,612 | 612 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ILS | 352 | 101,000 | 101,076 | 76 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 23 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||||||
Japanese Yen, | ||||||||||||||||||||||||||
Expiring 05/15/20 | Citibank, N.A. | JPY | 5,109 | $ | 47,965 | $ | 47,616 | $ | — | $ | (349 | ) | ||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | JPY | 10,761 | 100,388 | 100,401 | 13 | — | |||||||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | JPY | 976 | 9,100 | 9,102 | 2 | — | |||||||||||||||||||
Kazakhstani Tenge, | ||||||||||||||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | KZT | 12,356 | 32,050 | 28,963 | — | (3,087 | ) | ||||||||||||||||||
Expiring 05/11/20 | JPMorgan Chase Bank, N.A. | KZT | 5,753 | 14,957 | 13,486 | — | (1,471 | ) | ||||||||||||||||||
Expiring 06/30/20 | Morgan Stanley & Co. International PLC | KZT | 6,522 | 13,775 | 15,030 | 1,255 | — | |||||||||||||||||||
Mexican Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | MXN | 3,327 | 158,928 | 136,977 | — | (21,951 | ) | ||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | MXN | 894 | 37,471 | 36,789 | — | (682 | ) | ||||||||||||||||||
New Taiwanese Dollar, | ||||||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | TWD | 1,703 | 57,521 | 57,746 | 225 | — | |||||||||||||||||||
Peruvian Nuevo Sol, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | PEN | 184 | 52,337 | 54,204 | 1,867 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 443 | 132,000 | 130,877 | — | (1,123 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PEN | 357 | 105,000 | 105,403 | 403 | — | |||||||||||||||||||
Philippine Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 6,118 | 119,000 | 120,890 | 1,890 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 5,649 | 111,000 | 111,625 | 625 | — | |||||||||||||||||||
Polish Zloty, | ||||||||||||||||||||||||||
Expiring 07/17/20 | UBS AG | PLN | 349 | 83,625 | 84,206 | 581 | — | |||||||||||||||||||
Russian Ruble, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 7,466 | 111,981 | 99,529 | — | (12,452 | ) | ||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | RUB | 5,934 | 82,123 | 79,097 | — | (3,026 | ) | ||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | RUB | 3,439 | 43,500 | 45,848 | 2,348 | — | |||||||||||||||||||
Singapore Dollar, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | SGD | 177 | 124,000 | 125,693 | 1,693 | — | |||||||||||||||||||
Expiring 06/17/20 | Credit Suisse International | SGD | 187 | 131,000 | 132,457 | 1,457 | — | |||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | SGD | 163 | 115,000 | 115,816 | 816 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | SGD | 191 | 137,599 | 135,206 | — | (2,393 | ) | ||||||||||||||||||
South African Rand, | ||||||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 1,117 | 64,000 | 59,964 | — | (4,036 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 233 | 12,332 | 12,516 | 184 | — | |||||||||||||||||||
South Korean Won, | ||||||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 46,997 | 38,701 | 38,716 | 15 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 21,743 | 17,879 | 17,912 | 33 | — |
See Notes to Financial Statements.
24 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Purchase Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||||||
Thai Baht, | ||||||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,835 | $ | 118,000 | $ | 118,525 | $ | 525 | $ | — | |||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,747 | 115,000 | 115,803 | 803 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,493 | 107,000 | 107,976 | 976 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,208 | 98,000 | 99,138 | 1,138 | — | |||||||||||||||||||
Turkish Lira, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 335 | 48,000 | 47,293 | — | (707 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||
$ | 5,328,889 | $ | 5,300,534 | 54,723 | (83,078 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts: |
| |||||||||||||||||||||||||
Australian Dollar, | ||||||||||||||||||||||||||
Expiring 07/20/20 | HSBC Bank USA, N.A. | AUD | 315 | $ | 201,789 | $ | 205,518 | $ | — | $ | | (3,729) | ||||||||||||||
Brazilian Real, | ||||||||||||||||||||||||||
Expiring 05/05/20 | Goldman Sachs International | BRL | 371 | 72,644 | 68,193 | 4,451 | — | |||||||||||||||||||
Expiring 05/05/20 | JPMorgan Chase Bank, N.A. | BRL | 197 | 37,096 | 36,236 | 860 | — | |||||||||||||||||||
Expiring 05/05/20 | Morgan Stanley & Co. International PLC | BRL | 1,291 | 253,155 | 237,332 | 15,823 | — | |||||||||||||||||||
Expiring 06/02/20 | Goldman Sachs International | BRL | 509 | 91,170 | 93,418 | — | (2,248 | ) | ||||||||||||||||||
Expiring 06/02/20 | HSBC Bank USA, N.A. | BRL | 665 | 117,145 | 121,881 | — | (4,736 | ) | ||||||||||||||||||
Expiring 06/02/20 | Morgan Stanley & Co. International PLC | BRL | 685 | 121,083 | 125,634 | — | (4,551 | ) | ||||||||||||||||||
Canadian Dollar, | ||||||||||||||||||||||||||
Expiring 07/20/20 | Morgan Stanley & Co. International PLC | CAD | 54 | 38,125 | 38,632 | — | (507 | ) | ||||||||||||||||||
Chilean Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | CLP | 13,575 | 15,772 | 16,280 | — | (508 | ) | ||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | CLP | 117,482 | 140,688 | 140,891 | — | (203 | ) | ||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | CLP | 31,794 | 38,308 | 38,129 | 179 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 166,222 | 198,806 | 199,344 | — | (538 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 56,665 | 67,000 | 67,957 | — | (957 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 32,748 | 38,701 | 39,274 | — | (573 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | CLP | 15,297 | 17,879 | 18,345 | — | (466 | ) | ||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | CLP | 66,912 | 80,000 | 80,245 | — | (245 | ) | ||||||||||||||||||
Expiring 06/17/20 | The Toronto- Dominion Bank | CLP | 64,955 | 77,052 | 77,898 | — | (846 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 25 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||||||
Chinese Renminbi, | ||||||||||||||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 1,057 | $ | 150,000 | $ | 149,272 | $ | 728 | $ | — | |||||||||||||||
Expiring 05/11/20 | Citibank, N.A. | CNH | 798 | 114,000 | 112,767 | 1,233 | — | |||||||||||||||||||
Expiring 05/11/20 | Credit Suisse International | CNH | 995 | 140,000 | 140,467 | — | (467 | ) | ||||||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 888 | 125,000 | 125,420 | — | (420 | ) | ||||||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 333 | 47,600 | 47,088 | 512 | — | |||||||||||||||||||
Expiring 05/11/20 | HSBC Bank USA, N.A. | CNH | 318 | 45,550 | 44,973 | 577 | — | |||||||||||||||||||
Expiring 05/11/20 | Morgan Stanley & Co. International PLC | CNH | 260 | 36,500 | 36,755 | — | (255 | ) | ||||||||||||||||||
Expiring 05/14/21 | JPMorgan Chase Bank, N.A. | CNH | 994 | 142,624 | 138,905 | 3,719 | — | |||||||||||||||||||
Colombian Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | COP | 163,928 | 43,145 | 41,229 | 1,916 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | COP | 45,103 | 13,056 | 11,344 | 1,712 | — | |||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | COP | 162,019 | 46,682 | 40,748 | 5,934 | — | |||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs | |||||||||||||||||||||||||
International | COP | 154,298 | 37,956 | 38,806 | — | (850 | ) | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | COP | 58,973 | 16,880 | 14,832 | 2,048 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | COP | 241,955 | 62,000 | 60,852 | 1,148 | — | |||||||||||||||||||
Expiring 06/17/20 | UBS AG | COP | 207,450 | 51,000 | 52,174 | — | (1,174 | ) | ||||||||||||||||||
Expiring 06/17/20 | UBS AG | COP | 196,843 | 50,000 | 49,506 | 494 | — | |||||||||||||||||||
Czech Koruna, | ||||||||||||||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | CZK | 1,529 | 61,000 | 61,892 | — | (892 | ) | ||||||||||||||||||
Egyptian Pound, | ||||||||||||||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 136 | 8,524 | 8,581 | — | (57 | ) | ||||||||||||||||||
Expiring 05/18/20 | Citibank, N.A. | EGP | 47 | 2,963 | 2,974 | — | (11 | ) | ||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 621 | 38,448 | 38,666 | — | (218 | ) | ||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | EGP | 281 | 17,369 | 17,511 | — | (142 | ) | ||||||||||||||||||
Euro, | ||||||||||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | EUR | 274 | 296,514 | 300,221 | — | (3,707 | ) | ||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | EUR | 182 | 198,718 | 199,334 | — | (616 | ) | ||||||||||||||||||
Expiring 07/17/20 | Goldman Sachs | |||||||||||||||||||||||||
International | EUR | 19 | 20,700 | 20,718 | — | (18 | ) | |||||||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | EUR | 177 | 193,094 | 194,336 | — | (1,242 | ) | ||||||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | EUR | 177 | 193,022 | 194,335 | — | (1,313 | ) | ||||||||||||||||||
Expiring 11/03/20 | Morgan Stanley & Co. International PLC | EUR | 1,005 | 1,136,889 | 1,106,241 | 30,648 | — | |||||||||||||||||||
Hungarian Forint, | ||||||||||||||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | HUF | 19,164 | 58,000 | 59,515 | — | (1,515 | ) | ||||||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | HUF | 25,078 | 76,000 | 77,881 | — | (1,881 | ) |
See Notes to Financial Statements.
26 |
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||||||
Indian Rupee, | ||||||||||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 3,695 | $ | 47,487 | $ | 48,953 | $ | — | $ | (1,466 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | INR | 3,441 | 44,050 | 45,318 | — | (1,268 | ) | ||||||||||||||||||
Indonesian Rupiah, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | IDR | 1,280,160 | 80,000 | 83,689 | — | (3,689 | ) | ||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 791,787 | 46,000 | 51,762 | — | (5,762 | ) | ||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | IDR | 715,434 | 43,000 | 46,771 | — | (3,771 | ) | ||||||||||||||||||
Israeli Shekel, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ILS | 506 | 132,000 | 145,291 | — | (13,291 | ) | ||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 319 | 92,000 | 91,533 | 467 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | ILS | 111 | 31,680 | 31,984 | — | (304 | ) | ||||||||||||||||||
Expiring 06/17/20 | Goldman Sachs International | ILS | 396 | 112,320 | 113,784 | — | (1,464 | ) | ||||||||||||||||||
Japanese Yen, | ||||||||||||||||||||||||||
Expiring 07/17/20 | JPMorgan Chase Bank, N.A. | JPY | 5,430 | 50,019 | 50,663 | — | (644 | ) | ||||||||||||||||||
Mexican Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | MXN | 869 | 36,150 | 35,758 | 392 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 2,180 | 102,708 | 89,737 | 12,971 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 1,053 | 44,900 | 43,368 | 1,532 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | MXN | 525 | 21,300 | 21,605 | — | (305 | ) | ||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | MXN | 1,369 | 67,000 | 56,377 | 10,623 | — | |||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | MXN | 481 | 19,800 | 19,810 | — | (10 | ) | ||||||||||||||||||
New Taiwanese Dollar, | ||||||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | TWD | 4,235 | 143,000 | 143,637 | — | (637 | ) | ||||||||||||||||||
Expiring 06/17/20 | UBS AG | TWD | 4,945 | 166,000 | 167,719 | — | (1,719 | ) | ||||||||||||||||||
Expiring 06/17/20 | UBS AG | TWD | 3,437 | 116,000 | 116,552 | — | (552 | ) | ||||||||||||||||||
New Zealand Dollar, | ||||||||||||||||||||||||||
Expiring 07/20/20 | JPMorgan Chase Bank, N.A. | NZD | 195 | 117,124 | 119,741 | — | (2,617 | ) | ||||||||||||||||||
Peruvian Nuevo Sol, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PEN | 517 | 150,491 | 152,700 | — | (2,209 | ) | ||||||||||||||||||
Philippine Peso, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | PHP | 6,045 | 119,000 | 119,454 | — | (454 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | PHP | 1,801 | 35,259 | 35,592 | — | (333 | ) | ||||||||||||||||||
Polish Zloty, | ||||||||||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | PLN | 339 | 81,000 | 81,743 | — | (743 | ) | ||||||||||||||||||
Expiring 07/17/20 | Barclays Bank PLC | PLN | 302 | 72,000 | 72,717 | — | (717 | ) | ||||||||||||||||||
Expiring 07/17/20 | Morgan Stanley & Co. International PLC | PLN | 38 | 9,100 | 9,174 | — | (74 | ) | ||||||||||||||||||
Russian Ruble, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 2,800 | 36,750 | 37,329 | — | (579 | ) | ||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 1,458 | 19,278 | 19,429 | — | (151 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 27 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Forward foreign currency exchange contracts outstanding at April 30, 2020 (continued):
Sale Contracts | Counterparty | Notional Amount (000) | Value at Settlement Date | Current Value | Unrealized Appreciation | Unrealized Depreciation | ||||||||||||||||||||
OTC Forward Foreign Currency Exchange Contracts (cont’d.): |
| |||||||||||||||||||||||||
Russian Ruble (cont’d.), | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | RUB | 1,224 | $ | 15,772 | $ | 16,311 | $ | — | $ | (539 | ) | ||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | RUB | 2,248 | 30,690 | 29,971 | 719 | — | |||||||||||||||||||
Singapore Dollar, | ||||||||||||||||||||||||||
Expiring 06/17/20 | BNP Paribas S.A. | SGD | 164 | 115,000 | 115,974 | — | (974 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | SGD | 64 | 45,600 | 45,392 | 208 | — | |||||||||||||||||||
South African Rand, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Bank of America, N.A. | ZAR | 936 | 51,000 | 50,252 | 748 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | ZAR | 781 | 41,000 | 41,941 | — | (941 | ) | ||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 690 | 37,981 | 37,057 | 924 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | ZAR | 243 | 15,597 | 13,020 | 2,577 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 2,609 | 162,411 | 140,083 | 22,328 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | ZAR | 1,271 | 69,000 | 68,224 | 776 | — | |||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | ZAR | 717 | 46,538 | 38,512 | 8,026 | — | |||||||||||||||||||
South Korean Won, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Credit Suisse International | KRW | 336,116 | 284,364 | 276,890 | 7,474 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | KRW | 89,777 | 73,000 | 73,958 | — | (958 | ) | ||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | KRW | 55,966 | 47,265 | 46,105 | 1,160 | — | |||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | KRW | 56,108 | 47,265 | 46,222 | 1,043 | — | |||||||||||||||||||
Expiring 06/17/20 | Morgan Stanley & Co. International PLC | KRW | 55,331 | 46,744 | 45,581 | 1,163 | — | |||||||||||||||||||
Expiring 06/17/20 | UBS AG | KRW | 56,056 | 47,265 | 46,044 | 1,221 | — | |||||||||||||||||||
Thai Baht, | ||||||||||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,722 | 116,000 | 115,046 | 954 | — | |||||||||||||||||||
Expiring 06/17/20 | HSBC Bank USA, N.A. | THB | 3,371 | 107,131 | 104,195 | 2,936 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | THB | 3,500 | 111,000 | 108,169 | 2,831 | — | |||||||||||||||||||
Turkish Lira, | ||||||||||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 411 | 65,000 | 58,146 | 6,854 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 285 | 44,717 | 40,242 | 4,475 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 265 | 37,986 | 37,488 | 498 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 256 | 37,981 | 36,152 | 1,829 | — | |||||||||||||||||||
Expiring 06/17/20 | Barclays Bank PLC | TRY | 245 | 38,960 | 34,623 | 4,337 | — | |||||||||||||||||||
Expiring 06/17/20 | Citibank, N.A. | TRY | 212 | 33,656 | 29,964 | 3,692 | — | |||||||||||||||||||
Expiring 06/17/20 | JPMorgan Chase Bank, N.A. | TRY | 271 | 41,559 | 38,239 | 3,320 | — | |||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||
$ | 8,875,545 | $ | 8,778,541 | 178,060 | (81,056 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||
$ | 232,783 | $ | (164,134 | ) | ||||||||||||||||||||||
|
|
|
|
See Notes to Financial Statements.
28 |
Cross currency exchange contracts outstanding at April 30, 2020:
Settlement | Type | Notional Amount (000) | In Exchange For (000) | Unrealized Appreciation | Unrealized Depreciation | Counterparty | ||||||||||||||||||||
OTC Cross Currency Exchange Contracts: |
| |||||||||||||||||||||||||
07/17/20 | Buy | EUR | 65 | CZK | 1,750 | $ | 43 | $ | — | Citibank, N.A. |
Summary of Collateral for Centrally Cleared/Exchange-traded Derivatives:
Cash and securities segregated as collateral, including pending settlement for closed positions, to cover requirements for centrally cleared/exchange-traded derivatives are listed by broker as follows:
Broker | Cash and/or Foreign Currency | Securities Market Value | ||||||
J.P. Morgan Securities LLC | $ | 200,000 | $ | — |
Fair Value Measurements:
Various inputs are used in determining the value of the Series’ investments. These inputs are summarized in the three broad levels listed below.
Level 1—unadjusted quoted prices generally in active markets for identical securities.
Level 2—quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates and other observable inputs.
Level 3—unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of April 30, 2020 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities | ||||||||||||
Assets | ||||||||||||
Corporate Bonds | ||||||||||||
Argentina | $ | — | $ | 74,708 | $ | — | ||||||
Azerbaijan | — | 210,303 | — | |||||||||
Brazil | — | 404,090 | — | |||||||||
Chile | — | 213,692 | — | |||||||||
China | — | 862,509 | — | |||||||||
India | — | 170,329 | — | |||||||||
Indonesia | — | 633,125 | — | |||||||||
Kazakhstan | — | 430,901 | — | |||||||||
Malaysia | — | 536,363 | — | |||||||||
Mexico | — | 1,548,820 | — | |||||||||
Russia | — | 617,085 | — | |||||||||
Saudi Arabia | — | 206,133 | — | |||||||||
South Africa | — | 615,065 | — | |||||||||
Trinidad & Tobago | — | 81,699 | — | |||||||||
Tunisia | — | 221,174 | — |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 29 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities (continued) | ||||||||||||
Assets (continued) | ||||||||||||
Corporate Bonds (continued) | ||||||||||||
Ukraine | $ | — | $ | 95,523 | $ | — | ||||||
United States | — | 195,328 | — | |||||||||
Venezuela | — | 37,950 | — | |||||||||
Sovereign Bonds | ||||||||||||
Angola | — | 363,095 | — | |||||||||
Argentina | — | 557,801 | — | |||||||||
Bahrain | — | 783,354 | — | |||||||||
Brazil | — | 823,964 | — | |||||||||
Colombia. | — | 612,509 | — | |||||||||
Congo (Republic) | — | 70,074 | — | |||||||||
Costa Rica | — | 320,873 | — | |||||||||
Croatia | — | 116,198 | — | |||||||||
Dominican Republic | — | 788,430 | — | |||||||||
Ecuador | — | 266,892 | — | |||||||||
Egypt | — | 789,177 | — | |||||||||
El Salvador | — | 401,078 | — | |||||||||
Gabon | — | 144,080 | — | |||||||||
Ghana | — | 672,558 | — | |||||||||
Greece | — | 262,623 | — | |||||||||
Guatemala | — | 200,768 | — | |||||||||
Honduras | — | 192,104 | — | |||||||||
Hungary | — | 259,740 | — | |||||||||
India | — | 183,201 | — | |||||||||
Indonesia | — | 1,008,317 | — | |||||||||
Iraq | — | 333,398 | — | |||||||||
Israel | — | 220,816 | — | |||||||||
Ivory Coast | — | 379,131 | — | |||||||||
Jamaica | — | 339,234 | — | |||||||||
Jordan | — | 184,672 | — | |||||||||
Kazakhstan | — | 264,206 | — | |||||||||
Kenya | — | 363,695 | — | |||||||||
Lebanon | — | 155,729 | — | |||||||||
Luxembourg | — | 60,000 | — | |||||||||
Mexico | — | 208,631 | — | |||||||||
Mongolia | — | 177,992 | — | |||||||||
Mozambique | — | 138,074 | — | |||||||||
Namibia | — | 182,158 | — | |||||||||
Nigeria | — | 635,430 | — | |||||||||
Oman | — | 452,916 | — | |||||||||
Pakistan | — | 528,499 | — | |||||||||
Panama | — | 534,710 | — | |||||||||
Papua New Guinea | — | 176,673 | — | |||||||||
Peru | — | 631,503 | — | |||||||||
Philippines | — | 641,735 | — | |||||||||
Qatar | — | 743,222 | — | |||||||||
Romania | — | 473,870 | — |
See Notes to Financial Statements.
30 |
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities (continued) | ||||||||||||
Assets (continued) | ||||||||||||
Sovereign Bonds (continued) | ||||||||||||
Russia | $ | — | $ | 521,942 | $ | — | ||||||
Saudi Arabia | — | 445,165 | — | |||||||||
Senegal | — | 170,520 | — | |||||||||
South Africa | — | 543,314 | — | |||||||||
Sri Lanka | — | 677,830 | — | |||||||||
Turkey | — | 1,079,018 | — | |||||||||
Ukraine | — | 1,253,053 | — | |||||||||
United Arab Emirates. | — | 600,723 | — | |||||||||
Uruguay | — | 496,479 | — | |||||||||
Venezuela | — | 15,680 | — | |||||||||
Zambia | — | 65,535 | — | |||||||||
Affiliated Mutual Fund | 1,094,963 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | 1,094,963 | $ | 29,667,186 | $ | — | ||||||
|
|
|
|
|
| |||||||
Other Financial Instruments* | ||||||||||||
Assets | ||||||||||||
OTC Forward Foreign Currency Exchange Contracts | $ | — | $ | 232,783 | $ | — | ||||||
OTC Cross Currency Exchange Contracts | — | 43 | — | |||||||||
|
|
|
|
|
| |||||||
Total | $ | — | $ | 232,826 | $ | — | ||||||
|
|
|
|
|
| |||||||
Liabilities | ||||||||||||
Futures Contracts | $ | (24,774 | ) | $ | — | $ | — | |||||
OTC Forward Foreign Currency Exchange Contracts | — | (164,134 | ) | — | ||||||||
|
|
|
|
|
| |||||||
Total | $ | (24,774 | ) | $ | (164,134 | ) | $ | — | ||||
|
|
|
|
|
|
* | Other financial instruments are derivative instruments not reflected in the Schedule of Investments, such as futures, forwards and centrally cleared swap contracts, which are recorded at the unrealized appreciation (depreciation) on the instrument, and OTC swap contracts which are recorded at fair value. |
Industry Classification:
The industry classification of investments and other assets in excess of liabilities shown as a percentage of net assets as of April 30, 2020 were as follows:
Sovereign Bonds | 71.7 | % | ||
Oil & Gas | 13.7 | |||
Affiliated Mutual Fund | 3.5 | |||
Electric | 2.0 | |||
Chemicals | 1.4 | |||
Transportation | 1.4 | |||
Real Estate | 1.2 | |||
Banks | 0.7 |
Mining | 0.7 | % | ||
Agriculture | 0.6 | |||
Engineering & Construction | 0.6 | |||
Auto Parts & Equipment | 0.5 | |||
|
| |||
98.0 | ||||
Other assets in excess of liabilities | 2.0 | |||
|
| |||
100.0 | % | |||
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 31 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Effects of Derivative Instruments on the Financial Statements and Primary Underlying Risk Exposure:
The Series invested in derivative instruments during the reporting period. The primary types of risk associated with these derivative instruments are foreign exchange contracts risk and interest rate contracts risk. See the Notes to Financial Statements for additional detail regarding these derivative instruments and their risks. The effect of such derivative instruments on the Series’ financial position and financial performance as reflected in the Statement of Assets and Liabilities and Statement of Operations is presented in the summary below.
Fair values of derivative instruments as of April 30, 2020 as presented in the Statement of Assets and Liabilities:
Asset Derivatives | Liability Derivatives | |||||||||||
Derivatives not accounted | Statement of Assets and Liabilities Location | Fair Value | Statement of Assets and Liabilities Location | Fair Value | ||||||||
Foreign exchange contracts | Unrealized appreciation on OTC cross currency exchange contracts | $ | 43 | — | $ | — | ||||||
Foreign exchange contracts | Unrealized appreciation on OTC forward foreign currency exchange contracts | 232,783 | Unrealized depreciation on OTC forward foreign currency exchange contracts | 164,134 | ||||||||
Interest rate contracts | — | — | Due from/to broker— variation margin futures | 24,774 | * | |||||||
|
|
|
| |||||||||
$ | 232,826 | $ | 188,908 | |||||||||
|
|
|
|
* | Includes cumulative appreciation (depreciation) as reported in the schedule of open futures and centrally cleared swap contracts. Only unsettled variation margin receivable (payable) is reported within the Statement of Assets and Liabilities. |
The effects of derivative instruments on the Statement of Operations for the six months ended April 30, 2020 are as follows:
Amount of Realized Gain (Loss) on Derivatives Recognized in Income | ||||
Derivatives not accounted for as hedging | Forward & Cross Currency Exchange Contracts | |||
Foreign exchange contracts | $ | 23,938 | ||
|
|
See Notes to Financial Statements.
32 |
Change in Unrealized Appreciation (Depreciation) on Derivatives Recognized in Income | ||||||||
Derivatives not accounted for as hedging | Futures | Forward & Cross Currency Exchange Contracts | ||||||
Foreign exchange contracts | $ | — | $ | 82,589 | ||||
Interest rate contracts | (24,774 | ) | — | |||||
|
|
|
| |||||
Total | $ | (24,774 | ) | $ | 82,589 | |||
|
|
|
|
For the six months ended April 30, 2020, the Series’ average volume of derivative activities is as follows:
Futures Contracts— Short Positions(1) | Forward Foreign Currency Exchange Contracts— Purchased(2) | |||||
$ | 623,673 | $ | 6,581,301 | |||
Forward Foreign Currency Exchange Contracts—Sold(2) | Cross Currency Exchange Contracts(3) | |||||
$ | 8,687,475 | $ | 43,301 |
(1) | Notional Amount in USD. |
(2) | Value at Settlement Date. |
(3) | Cost. |
Financial Instruments/Transactions—Summary of Offsetting and Netting Arrangements:
The Series invested in OTC derivatives during the reporting period that are either offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements that permit offsetting. The information about offsetting and related netting arrangements for OTC derivatives where the legal right to set-off exists is presented in the summary below.
Offsetting of OTC derivative assets and liabilities:
Counterparty | Gross Amounts of Recognized Assets(1) | Gross Amounts of Recognized Liabilities(1) | Net Amounts of Recognized Assets/(Liabilities) | Collateral Pledged/ (Received)(2) | Net Amount | |||||||||||||||
Bank of America, N.A. | $ | 2,615 | $ | — | $ | 2,615 | $ | — | $ | 2,615 | ||||||||||
Barclays Bank PLC | 26,066 | (38,132 | ) | (12,066 | ) | — | (12,066 | ) | ||||||||||||
BNP Paribas S.A. | 4,026 | (17,189 | ) | (13,163 | ) | — | (13,163 | ) | ||||||||||||
Citibank, N.A. | 10,464 | (35,898 | ) | (25,434 | ) | — | (25,434 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 33 |
Schedule of Investments (unaudited) (continued)
as of April 30, 2020
Counterparty | Gross Amounts of Recognized Assets(1) | Gross Amounts of Recognized Liabilities(1) | Net Amounts of Recognized Assets/(Liabilities) | Collateral Pledged/ (Received)(2) | Net Amount | |||||||||||||||
Credit Suisse International | $ | 8,931 | $ | (8,494 | ) | $ | 437 | $ | — | $ | 437 | |||||||||
Goldman Sachs International | 13,454 | (5,262 | ) | 8,192 | — | 8,192 | ||||||||||||||
HSBC Bank USA, N.A. | 23,963 | (15,246 | ) | 8,717 | — | 8,717 | ||||||||||||||
JPMorgan Chase Bank, N.A. | 65,493 | (22,911 | ) | 42,582 | — | 42,582 | ||||||||||||||
Morgan Stanley & Co. International PLC | 75,518 | (14,171 | ) | 61,347 | — | 61,347 | ||||||||||||||
The Toronto-Dominion Bank | — | (3,386 | ) | (3,386 | ) | — | (3,386 | ) | ||||||||||||
UBS AG | 2,296 | (3,445 | ) | (1,149 | ) | — | (1,149 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 232,826 | $ | (164,134 | ) | $ | 68,692 | $ | — | $ | 68,692 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Includes unrealized appreciation/(depreciation) on swaps and forwards, premiums paid/(received) on swap agreements and market value of purchased and written options, as represented on the Statement of Assets and Liabilities. |
(2) | Collateral amount disclosed by the Series is limited to the and the Series OTC derivative exposure by counterparty. |
See Notes to Financial Statements.
34 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Assets | ||||
Investments at value: | ||||
Unaffiliated investments (cost $36,433,517) | $ | 29,667,186 | ||
Affiliated investments (cost $1,094,963) | 1,094,963 | |||
Foreign currency, at value (cost $55,988) | 56,252 | |||
Dividends and interest receivable | 480,403 | |||
Unrealized appreciation on OTC forward foreign currency exchange contracts | 232,783 | |||
Deposit with broker for centrally cleared/exchange-traded derivatives | 200,000 | |||
Receivable for Series shares sold | 171,626 | |||
Due from Manager | 5,323 | |||
Unrealized appreciation on OTC cross currency exchange contracts | 43 | |||
Prepaid expenses | 271 | |||
|
| |||
Total Assets | 31,908,850 | |||
|
| |||
Liabilities | ||||
Payable for investments purchased | 200,000 | |||
Unrealized depreciation on OTC forward foreign currency exchange contracts | 164,134 | |||
Payable for Series shares reacquired | 92,682 | |||
Accrued expenses and other liabilities | 38,700 | |||
Custodian and accounting fees payable | 29,620 | |||
Due to broker—variation margin futures | 7,702 | |||
Affiliated transfer agent fee payable | 1,881 | |||
Distribution fee payable | 9 | |||
|
| |||
Total Liabilities | 534,728 | |||
|
| |||
Net Assets | $ | 31,374,122 | ||
|
| |||
Net assets were comprised of: | ||||
Common stock, at par | $ | 39,782 | ||
Paid-in capital in excess of par | 38,992,393 | |||
Total distributable earnings (loss) | (7,658,053 | ) | ||
|
| |||
Net assets, April 30, 2020 | $ | 31,374,122 | ||
|
|
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 35 |
Statement of Assets and Liabilities (unaudited)
as of April 30, 2020
Class A | ||||
Net asset value, offering price and redemption price per share, | $ | 7.88 | ||
Maximum sales charge (3.25% of offering price) | 0.28 | |||
|
| |||
Maximum offering price to public | $ | 8.16 | ||
|
| |||
Class C | ||||
Net asset value, offering price and redemption price per share, | $ | 7.88 | ||
|
| |||
Class Z | ||||
Net asset value, offering price and redemption price per share, | $ | 7.89 | ||
|
| |||
Class R6 | ||||
Net asset value, offering price and redemption price per share, | $ | 7.89 | ||
|
|
See Notes to Financial Statements.
36 |
Statement of Operations (unaudited)
Six Months Ended April 30, 2020
Net Investment Income (Loss) | ||||
Income | ||||
Interest income | $ | 950,710 | ||
Affiliated dividend income | 7,422 | |||
|
| |||
Total income | 958,132 | |||
|
| |||
Expenses | ||||
Management fee | 110,550 | |||
Distribution fee(a) | 66 | |||
Custodian and accounting fees | 43,476 | |||
Registration fees(a) | 26,795 | |||
Audit fee | 18,461 | |||
Shareholders’ reports | 13,336 | |||
Transfer agent’s fees and expenses (including affiliated expense of $5,011)(a) | 11,003 | |||
Legal fees and expenses | 8,176 | |||
Directors’ fees | 5,579 | |||
Miscellaneous | 7,398 | |||
|
| |||
Total expenses | 244,840 | |||
Less: Fee waiver and/or expense reimbursement(a) | (130,842 | ) | ||
|
| |||
Net expenses | 113,998 | |||
|
| |||
Net investment income (loss) | 844,134 | |||
|
| |||
Realized And Unrealized Gain (Loss) On Investment And Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investment transactions | (219,240 | ) | ||
Forward and cross currency contract transactions | 23,938 | |||
Foreign currency transactions | (2,327 | ) | ||
|
| |||
(197,629 | ) | |||
|
| |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | (6,237,539 | ) | ||
Futures | (24,774 | ) | ||
Forward and cross currency contracts | 82,589 | |||
Foreign currencies | (379 | ) | ||
|
| |||
(6,180,103 | ) | |||
|
| |||
Net gain (loss) on investment and foreign currency transactions | (6,377,732 | ) | ||
|
| |||
Net Increase (Decrease) In Net Assets Resulting From Operations | $ | (5,533,598 | ) | |
|
|
(a) | Class specific expenses and waivers were as follows: |
Class A | Class C | Class Z | Class R6 | |||||||||||||
Distribution fee | 16 | 50 | — | — | ||||||||||||
Registration fees | 6,707 | 6,707 | 6,886 | 6,495 | ||||||||||||
Transfer agent’s fees and expenses | 67 | 21 | 10,866 | 49 | ||||||||||||
Fee waiver and/or expense reimbursement | (6,802 | ) | (6,750 | ) | (35,746 | ) | (81,544 | ) |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 37 |
Statements of Changes in Net Assets (unaudited)
Six Months Ended April 30, 2020 | Year Ended October 31, 2019 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 844,134 | $ | 1,505,185 | ||||
Net realized gain (loss) on investment and foreign currency transactions | (197,629 | ) | 82,884 | |||||
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | (6,180,103 | ) | 1,955,940 | |||||
|
|
|
| |||||
Net increase (decrease) in net assets resulting from operations | (5,533,598 | ) | 3,544,009 | |||||
|
|
|
| |||||
Dividends and Distributions | ||||||||
Distributions from distributable earnings | ||||||||
Class A | (384 | ) | (662 | ) | ||||
Class C | (265 | ) | (480 | ) | ||||
Class Z | (232,022 | ) | (200,243 | ) | ||||
Class R6 | (818,316 | ) | (1,481,664 | ) | ||||
|
|
|
| |||||
(1,050,987 | ) | (1,683,049 | ) | |||||
|
|
|
| |||||
Series share transactions | ||||||||
Net proceeds from shares sold | 8,928,665 | 4,632,832 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | 1,050,325 | 1,681,976 | ||||||
Cost of shares reacquired | (4,318,072 | ) | (1,464,362 | ) | ||||
|
|
|
| |||||
Net increase (decrease) in net assets from Series share transactions | 5,660,918 | 4,850,446 | ||||||
|
|
|
| |||||
Total increase (decrease) | (923,667 | ) | 6,711,406 | |||||
Net Assets: | ||||||||
Beginning of period | 32,297,789 | 25,586,383 | ||||||
|
|
|
| |||||
End of period | $ | 31,374,122 | $ | 32,297,789 | ||||
|
|
|
|
See Notes to Financial Statements.
38 |
Notes to Financial Statements (unaudited)
Prudential World Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company and currently consists of seven series: PGIM Jennison Emerging Markets Equity Opportunities Fund, PGIM Jennison Global Opportunities Fund, PGIM Jennison International Opportunities Fund and PGIM QMA International Equity Fund, each of which are diversified funds and PGIM Jennison Global Infrastructure Fund, PGIM Emerging Markets Debt Hard Currency Fund and PGIM Emerging Markets Debt Local Currency Fund, each of which are non-diversified funds for purposes of the 1940 Act. These financial statements relate only to the PGIM Emerging Markets Debt Hard Currency Fund (the “Series”).
The investment objective of the Series is total return, through a combination of current income and capital appreciation.
1. Accounting Policies
The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 Financial Services—Investment Companies. The following accounting policies conform to U.S. generally accepted accounting principles. The Series consistently follows such policies in the preparation of its financial statements.
Securities Valuation: The Series holds securities and other assets and liabilities that are fair valued at the close of each day (generally, 4:00 PM Eastern time) the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Board of Directors (the “Board”) has adopted valuation procedures for security valuation under which fair valuation responsibilities have been delegated to PGIM Investments LLC (“PGIM Investments” or the “Manager”). Pursuant to the Board’s delegation, the Manager has established a Valuation Committee responsible for supervising the fair valuation of portfolio securities and other assets and liabilities. The valuation procedures permit the Series to utilize independent pricing vendor services, quotations from market makers, and alternative valuation methods when market quotations are either not readily available or not deemed representative of fair value. A record of the Valuation Committee’s actions is subject to the Board’s review, approval, and ratification at its next regularly scheduled quarterly meeting.
For the fiscal reporting period-end, securities and other assets and liabilities were fair valued at the close of the last U.S. business day. Trading in certain foreign securities may occur when the NYSE is closed (including weekends and holidays). Because such foreign securities trade in markets that are open on weekends and U.S. holidays, the values of some
PGIM Emerging Markets Debt Hard Currency Fund | 39 |
Notes to Financial Statements (unaudited) (continued)
of the Series’ foreign investments may change on days when investors cannot purchase or redeem Series shares.
Various inputs determine how the Series’ investments are valued, all of which are categorized according to the three broad levels (Level 1, 2, or 3) detailed in the Schedule of Investments and referred to herein as the “fair value hierarchy” in accordance with FASB ASC Topic 820—Fair Value Measurements and Disclosures.
Investments in open-end, non-exchange-traded mutual funds are valued at their net asset values as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 in the fair value hierarchy since they may be purchased or sold at their net asset values on the date of valuation.
Fixed income securities traded in the OTC market are generally classified as Level 2 in the fair value hierarchy. Such fixed income securities are typically valued using the market approach which generally involves obtaining data from an approved independent third-party vendor source. The Series utilizes the market approach as the primary method to value securities when market prices of identical or comparable instruments are available. The third-party vendors’ valuation techniques used to derive the evaluated bid price are based on evaluating observable inputs, including but not limited to, yield curves, yield spreads, credit ratings, deal terms, tranche level attributes, default rates, cash flows, prepayment speeds, broker/dealer quotations and reported trades. Certain Level 3 securities are also valued using the market approach when obtaining a single broker quote or when utilizing transaction prices for identical securities that have been used in excess of five business days. During the reporting period, there were no changes to report with respect to the valuation approach and/or valuation techniques discussed above.
OTC and centrally cleared derivative instruments are generally classified as Level 2 in the fair value hierarchy. Such derivative instruments are typically valued using the market approach and/or income approach which generally involves obtaining data from an approved independent third-party vendor source. The Series utilizes the market approach when quoted prices in broker-dealer markets are available but also includes consideration of alternative valuation approaches, including the income approach. In the absence of reliable market quotations, the income approach is typically utilized for purposes of valuing derivatives such as interest rate swaps based on a discounted cash flow analysis whereby the value of the instrument is equal to the present value of its future cash inflows or outflows. Such analysis includes projecting future cash flows and determining the discount rate (including the present value factors that affect the discount rate) used to discount the future cash flows. In addition, the third-party vendors’ valuation techniques used to derive the evaluated derivative price is based on evaluating observable inputs, including but not limited to, underlying asset prices, indices, spreads, interest rates and exchange rates. Certain
40 |
derivatives may be classified as Level 3 when valued using the market approach by obtaining a single broker quote or when utilizing unobservable inputs in the income approach. During the reporting period, there were no changes to report with respect to the valuation approach and/or valuation techniques discussed above.
Securities and other assets that cannot be priced according to the methods described above are valued based on pricing methodologies approved by the Board. In the event that unobservable inputs are used when determining such valuations, the securities will be classified as Level 3 in the fair value hierarchy.
When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the Manager regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other unaffiliated mutual funds to calculate their net asset values.
Illiquid Securities: Pursuant to Rule 22e-4 under the 1940 Act, the Series has adopted a Board approved Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Series limit its illiquid investments that are assets to no more than 15% of net assets. Illiquid securities are those that, because of the absence of a readily available market or due to legal or contractual restrictions on resale, may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. The Series may find it difficult to sell illiquid securities at the time considered most advantageous by its subadviser(s) and may incur transaction costs that would not be incurred in the sale of securities that were freely marketable.
Restricted Securities: Securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer are considered restricted as to disposition under federal securities law (“restricted securities”). Such restricted securities are valued pursuant to the valuation procedures noted above. Restricted securities that would otherwise be considered illiquid investments pursuant to the Series’ LRMP because of legal restrictions on resale to the general public may be traded among qualified institutional buyers under Rule 144A of the Securities Act of 1933. Therefore, these Rule 144A securities, as well as commercial paper that is sold in private placements under Section 4(2) of the Securities Act of 1933, may be classified higher than “illiquid” under the LRMP (i.e. “moderately liquid” or “less liquid” investments). However, the liquidity of the Series’ investments in restricted securities could be impaired if trading does not develop or declines.
PGIM Emerging Markets Debt Hard Currency Fund | 41 |
Notes to Financial Statements (unaudited) (continued)
Foreign Currency Translation: The books and records of the Series 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 current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Series are presented at the foreign exchange rates and market values at the close of the period, the Series does not generally 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 long-term portfolio securities held at the end of the period. Similarly, the Series does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, holding period realized foreign currency gains (losses) are included in the reported net realized gains (losses) on investment transactions. Notwithstanding the above, the Series does isolate the effect of fluctuations in foreign currency exchange rates when determining the gain (loss) upon the sale or maturity of foreign currency denominated debt obligations; such amounts are included in net
Additionally, net realized gains (losses) on foreign currency transactions represent net foreign exchange gains (losses) from the disposition of holdings of foreign currencies, currency gains (losses) realized between the trade and settlement dates on investment transactions, and the difference between the amounts of interest, dividends and foreign withholding taxes recorded on the Series’ books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains (losses) arise from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates.
Forward and Cross 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 Series enters into forward currency contracts, as defined in the prospectus, 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 and to gain exposure to certain currencies. The contracts are valued daily at current forward exchange rates and any unrealized gain (loss) is included in net unrealized appreciation (depreciation) on forward and cross currency contracts. Gain (loss) is realized on the settlement date of the contract equal to the difference between the settlement value of the original and negotiated forward contracts. This gain (loss), if any, is included in net realized gain (loss) on forward
42 |
and cross currency contract transactions. Risks may arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts. Forward currency contracts involve risks from currency exchange rate and credit risk in excess of the amounts reflected on the Statement of Assets and Liabilities. The Series’ maximum risk of loss from counterparty credit risk is the net value of the cash flows to be received from the counterparty at the end of the contract’s life. A cross currency contract is a forward contract where a specified amount of one foreign currency will be exchanged for a specified amount of another foreign currency.
Financial Futures Contracts: A financial futures contract is an agreement to purchase (long) or sell (short) an agreed amount of securities at a set price for delivery on a future date. Upon entering into a financial futures contract, the Series is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount. This amount is known as the “initial margin.” Subsequent payments, known as “variation margin,” are made or received by the Series each day, depending on the daily fluctuations in the value of the underlying security. Such variation margin is recorded for financial statement purposes on a daily basis as unrealized gain (loss). When the contract expires or is closed, the gain (loss) is realized and is presented in the Statement of Operations as net realized gain (loss) on futures transactions.
The Series invested in financial futures contracts in order to hedge its existing portfolio securities, or securities the Series intends to purchase, against fluctuations in value caused by changes in prevailing interest rates. Should interest rates move unexpectedly, the Series may not achieve the anticipated benefits of the financial futures contracts and may realize a loss. The use of futures transactions involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates and the underlying hedged assets. Since futures contracts are exchange-traded, there is minimal counterparty credit risk to the Series since the exchanges’ clearinghouse acts as counterparty to all exchange-traded futures and guarantees the futures contracts against default.
Master Netting Arrangements: The Fund, on behalf of the Series, is subject to various Master Agreements, or netting arrangements, with select counterparties. These are agreements which a subadviser may have negotiated and entered into on behalf of all or a portion of the Series. A master netting arrangement between the Series and the counterparty permits the Series to offset amounts payable by the Series to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Series to cover the Series’ exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable. In addition to master netting arrangements, the right to set-off exists when all the conditions are met such that each of the parties owes the other determinable amounts, the reporting party has the right to set-off the amount owed with the amount owed by the other party, the reporting party intends to set-off and the right of set-off is enforceable by law. During the reporting period, there was no intention to settle on a net basis and all amounts are presented on a gross basis on the Statement of Assets and Liabilities.
PGIM Emerging Markets Debt Hard Currency Fund | 43 |
Notes to Financial Statements (unaudited) (continued)
The Fund, on behalf of the Series, is a party to International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreements with certain counterparties that govern OTC derivative and foreign exchange contracts entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties’ general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agreements, collateral posted to the Series is held in a segregated account by the Series’ custodian and with respect to those amounts which can be sold or re-pledged, is presented in the Schedule of Investments. Collateral pledged by the Series is segregated by the Series’ custodian and identified in the Schedule of Investments. Collateral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other securities as agreed to by the Series and the applicable counterparty. Collateral requirements are determined based on the Series’ net position with each counterparty. Termination events applicable to the Series may occur upon a decline in the Series’ net assets below a specified threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term and short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the Series’ counterparties to elect early termination could impact the Series’ future derivative activity.
As of April 30, 2020, the Series has not met conditions under such agreements which give the counterparty the right to call for an early termination.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) from investment and currency transactions are calculated on the specific identification method. Dividend income is recorded on the ex-date, or for certain foreign securities, when the Series becomes aware of such dividends. Interest income, including amortization of premium and accretion of discount on debt securities, as required, is recorded on the accrual basis. Expenses are recorded on an accrual basis, which may require the use of certain estimates by management that may differ from actual. Net investment income or loss (other than class specific expenses and waivers, which are allocated as noted below) and unrealized and realized gains (losses) are allocated daily to each class of shares based upon the relative proportion of adjusted net assets of each class at the beginning of the day. Class specific expenses and waivers, where applicable, are charged to the respective share classes. Class specific expenses include distribution fees and distribution fee waivers, shareholder servicing fees, transfer agent’s fees and expenses, registration fees and fee waivers and/or expense reimbursements, as applicable.
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Taxes: It is the Series’ policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required. Withholding taxes on foreign dividends, interest and capital gains, if any, are recorded, net of reclaimable amounts, at the time the related income is earned.
Dividends and Distributions: The Series expects to declare dividends of its net investment income daily and pay such dividends monthly. Distributions of net realized capital and currency gains, if any, are declared and paid at least annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-date. Permanent book/tax differences relating to income and gain (loss) are reclassified between total distributable earnings (loss) and paid-in capital in excess of par, as appropriate.
Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
2. Agreements
The Fund, on behalf of the Series, has a management agreement with the Manager. Pursuant to this agreement, the Manager has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. In addition, under the management agreement, the Manager provides all of the administrative functions necessary for the organization, operation and management of the Series. The Manager administers the corporate affairs of the Series and, in connection therewith, furnishes the Series with office facilities, together with those ordinary clerical and bookkeeping services which are not being furnished by the Series’ custodian and the Series’ transfer agent. The Manager is also responsible for the staffing and management of dedicated groups of legal, marketing, compliance and related personnel necessary for the operation of the Series. The legal, marketing, compliance and related personnel are also responsible for the management and oversight of the various service providers to the Series, including, but not limited to, the custodian, transfer agent, and accounting agent.
The Manager has entered into a subadvisory agreement with PGIM, Inc., which provides subadvisory services to the Series through PGIM Fixed Income and PGIM Limited, each of which is a business unit of PGIM, Inc. The subadvisory agreement provides that PGIM, Inc. will furnish investment advisory services in connection with the management of the Series. In connection therewith, PGIM, Inc. is obligated to keep certain books and records of the Series. The Manager pays for the services of PGIM, Inc., the cost of compensation of officers of the Series, occupancy and certain clerical and bookkeeping costs of the Series. The Series bears all other costs and expenses.
PGIM Emerging Markets Debt Hard Currency Fund | 45 |
Notes to Financial Statements (unaudited) (continued)
Effective December 13, 2019, the management fee paid to the Manager is accrued daily and payable monthly at an annual rate of 0.65% of the Series’ average daily net assets up to and including $1 billion; 0.63% from $1 billion to $3 billion of average daily net assets; 0.61% from $3 billion to $5 billion of average daily net assets; 0.60% from $5 billion to $10 billion of average daily net assets; and 0.59% of the average daily net assets exceeding $10 billion. Prior to December 13, 2019, the management fee paid to the Manager was accrued daily and payable monthly at an annual rate of 0.72% of the Series’ average daily net assets up to and including $1 billion; 0.70% from $1 billion to $3 billion of average daily net assets; 0.68% from $3 billion to $5 billion of average daily net assets; 0.67% from $5 billion to $10 billion of average daily net assets; and 0.66% of the average daily net assets exceeding $10 billion. The effective management fee rate before any waivers and/or expense reimbursements was 0.67% for the reporting period ended April 30, 2020.
Effective December 1, 2019, the Manager has contractually agreed, through February 28, 2021, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.05% of average daily net assets for Class A shares, 1.80% of average daily net assets for Class C shares, 0.75% of average daily net assets for Class Z shares and
0.65% of average daily net assets for Class R6 shares. Prior to December 1, 2019, the Manager had contractually agreed, to limit total annual operating expenses after fee waivers and/or expense reimbursements to 1.05% of average daily net assets for Class A shares, 1.80% of average daily net assets for Class C shares, 0.80% of average daily net assets for Class Z shares and 0.74% of average daily net assets for Class R6 shares. This contractual waiver excludes interest, brokerage, taxes (such as income and foreign withholding taxes, stamp duty and deferred tax expenses), acquired fund fees and expenses, extraordinary expenses, and certain other Series expenses such as dividend and interest expense and broker charges on short sales.
Where applicable, the Manager agrees to waive management fees or shared operating expenses on any share class to the same extent that it waives similar expenses on any other share class. In addition, total annual operating expenses for Class R6 shares will not exceed total annual operating expenses for Class Z shares. Fees and/or expenses waived and/or reimbursed by the Manager may be recouped by the Manager within the same fiscal year during which such waiver/reimbursement is made if such recoupment can be realized without exceeding the expense limit in effect at the time of the recoupment for that fiscal year.
The Fund, on behalf of the Series, has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class C, Class Z and Class R6 shares of the Series. The Series compensates PIMS for distributing and servicing the Series’ Class A and Class C shares, pursuant to the plans of distribution (the “Distribution Plans”), regardless of expenses actually incurred by PIMS. The
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distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z or Class R6 shares of the Series.
Pursuant to the Distribution Plans, the Series compensates PIMS for distribution related activities at an annual rate of up to 0.25% and 1% of the average daily net assets of the Class A and Class C shares, respectively.
For the reporting period ended April 30, 2020, PIMS has not received any front-end sales charges resulting from sales of Class A shares. Additionally, for the reporting period ended April 30, 2020, PIMS did not receive any contingent deferred sales charges imposed upon redemptions by certain Class A and Class C shareholders.
PGIM Investments, PGIM, Inc and PIMS are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PGIM Investments and an indirect, wholly-owned subsidiary of Prudential, serves as the Series’ transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Series may invest its overnight sweep cash in the PGIM Core Ultra Short Bond Fund (the “Core Fund”), a series of Prudential Investment Portfolios 2, registered under the 1940 Act and managed by PGIM Investments. Through the Series’ investments in the mentioned underlying funds, PGIM Investments and/or its affiliates are paid fees or reimbursed for providing their services. In addition to the realized and unrealized gains on investments in the Core Fund, earnings from such investments are disclosed on the Statement of Operations as “Affiliated dividend income”.
The Series may enter into certain securities purchase or sale transactions under Board approved Rule 17a-7 procedures. Rule 17a-7 is an exemptive rule under the 1940 Act, that subject to certain conditions, permits purchase and sale transactions among affiliated investment companies, or between an investment company and a person that is affiliated solely by reason of having a common (or affiliated) investment adviser, common directors, and/or common officers. Pursuant to the Rule 17a-7 procedures and consistent with guidance issued by the Securities and Exchange Commission (“SEC”), the Series’ Chief Compliance Officer (“CCO”) prepares a quarterly summary of all such transactions for submission to the Board, together with the CCO’s written representation that all such 17a-7 transactions were effected in accordance with the Series’ Rule 17a-7 procedures. For the reporting period ended April 30, 2020, no 17a-7 transactions were entered into by the Series.
PGIM Emerging Markets Debt Hard Currency Fund | 47 |
Notes to Financial Statements (unaudited) (continued)
4. Portfolio Securities
The aggregate cost of purchases and proceeds from sales of portfolio securities (excluding short-term investments and U.S. Government securities) for the reporting period ended April 30, 2020, were $8,424,750 and $3,105,106, respectively.
A summary of the cost of purchases and proceeds from sales of shares of an affiliated investment for the reporting period ended April 30, 2020, is presented as follows:
Value, Beginning of Period | Cost of Purchases | Proceeds from Sales | Change in Unrealized Gain (Loss) | Realized Gain (Loss) | Value, End of Period | Shares, End of Period | Income | |||||||||||||||||||||||
PGIM Core Ultra Short Bond Fund* | ||||||||||||||||||||||||||||||
$ | 1,254,895 | $ | 6,857,356 | $ | 7,017,288 | $ | — | $ | — | $ | 1,094,963 | 1,094,963 | $ | 7,422 | ||||||||||||||||
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* | The Fund did not have any capital gain distributions during the reporting period. |
5. Tax Information
The United States federal income tax basis of the Series’ investments and the net unrealized depreciation as of April 30, 2020 were as follows:
Tax Basis | $ | 37,886,053 | ||
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Gross Unrealized Appreciation | 783,225 | |||
Gross Unrealized Depreciation | (7,863,211 | ) | ||
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Net Unrealized Depreciation | $ | (7,079,986 | ) | |
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The book basis may differ from tax basis due to certain tax-related adjustments.
For federal income tax purposes, the Series had a capital loss carryforward as of October 31, 2019 of approximately $269,000 which can be carried forward for an unlimited period. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses.
The Manager has analyzed the Series’ tax positions taken on federal, state and local income tax returns for all open tax years and has concluded that no provision for income tax is required in the Series’ financial statements for the current reporting period. Since tax authorities can examine previously filed tax returns, the Series’ U.S. federal and state tax returns for each of the two fiscal years up to the most recent fiscal year ended October 31, 2019 are subject to such review.
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6. Capital and Ownership
The Series offers Class A, Class C, Class Z and Class R6 shares. Class A shares are sold with a maximum front-end sales charge of 3.25%. Investors who purchase $1 million or more prior to July 15, 2019 ($500,000 or more on or after July 15, 2019) of Class A shares and sell those shares within 12 months of purchase are subject to a contingent deferred sales charge (“CDSC”) of 1.00% on sales although these purchases are not subject to a front-end sales charge. The Class A CDSC is waived for certain retirement and/or benefit plans. A special exchange privilege is also available for shareholders who qualified to purchase Class A shares at net asset value. Class C shares are sold with a CDSC of 1% on sales made within 12 months of purchase. Class C shares will automatically convert to Class A shares on a monthly basis approximately 10 years after purchase. Class Z and Class R6 shares are not subject to any sales or redemption charges and are available exclusively for sale to a limited group of investors.
Under certain circumstances, an exchange may be made from specified share classes of the Series to one or more other share classes of the Series as presented in the table of transactions in shares of common stock.
The Fund is authorized to issue 5.075 billion shares of common stock, $0.01 par value per share, 600 million of which are designated as shares of the Series. The shares are further classified and designated as follows:
Class A | 100,000,000 | |||
Class C | 100,000,000 | |||
Class Z | 200,000,000 | |||
Class R6 | 200,000,000 |
As of April 30, 2020, Prudential, through its affiliated entities, including affiliated funds (if applicable), owned shares of the Series as follows:
Number of Shares | Percentage of Outstanding Shares | |||||||
Class A | 1,142 | 80 | % | |||||
Class C | 1,122 | 100 | % | |||||
Class R6 | 2,876,943 | 99.8 | % |
At reporting period end, the number of shareholders holding greater than 5% of the Series are as follows:
Affiliated | Unaffiliated | |||||
Number of Shareholders | Percentage of Outstanding Shares | Number of Shareholders | Percentage of Outstanding Shares | |||
1 | 72% | 1 | 22% |
PGIM Emerging Markets Debt Hard Currency Fund | 49 |
Notes to Financial Statements (unaudited) (continued)
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | ||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 4 | $ | 50 | |||||
Shares issued in reinvestment of dividends and distributions | 43 | 383 | ||||||
Shares reacquired | (5 | ) | (50 | ) | ||||
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Net increase (decrease) in shares outstanding | 42 | $ | 383 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 272 | $ | 2,501 | |||||
Shares issued in reinvestment of dividends and distributions | 71 | 661 | ||||||
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Net increase (decrease) in shares outstanding | 343 | $ | 3,162 | |||||
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Class C | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares issued in reinvestment of dividends and distributions | 30 | $ | 265 | |||||
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Net increase (decrease) in shares outstanding | 30 | $ | 265 | |||||
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Year ended October 31, 2019: | ||||||||
Shares issued in reinvestment of dividends and distributions | 51 | $ | 480 | |||||
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Net increase (decrease) in shares outstanding | 51 | $ | 480 | |||||
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Class Z | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 995,043 | $ | 8,868,720 | |||||
Shares issued in reinvestment of dividends and distributions | 26,069 | 231,361 | ||||||
Shares reacquired | (536,293 | ) | (4,313,507 | ) | ||||
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Net increase (decrease) in shares outstanding | 484,819 | $ | 4,786,574 | |||||
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Year ended October 31, 2019: | ||||||||
Shares sold | 491,936 | $ | 4,630,331 | |||||
Shares issued in reinvestment of dividends and distributions | 21,227 | 199,171 | ||||||
Shares reacquired | (156,847 | ) | (1,464,362 | ) | ||||
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Net increase (decrease) in shares outstanding | 356,316 | $ | 3,365,140 | |||||
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Class R6 | ||||||||
Six months ended April 30, 2020: | ||||||||
Shares sold | 6,415 | $ | 59,895 | |||||
Shares issued in reinvestment of dividends and distributions | 90,777 | 818,316 | ||||||
Shares reacquired | (471 | ) | (4,515 | ) | ||||
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Net increase (decrease) in shares outstanding | 96,721 | $ | 873,696 | |||||
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Year ended October 31, 2019: | ||||||||
Shares issued in reinvestment of dividends and distributions | 159,025 | $ | 1,481,664 | |||||
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Net increase (decrease) in shares outstanding | 159,025 | $ | 1,481,664 | |||||
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7. Borrowings
The Fund, on behalf of the Series, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding
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for capital share redemptions. The table below provides details of the current SCA in effect at the reporting period-end.
SCA | ||
Term of Commitment | 10/3/2019 – 10/1/2020 | |
Total Commitment | $1,222,500,000* | |
Annualized Commitment Fee on the Unused Portion of the SCA | 0.15% | |
Annualized Interest Rate on Borrowings | 1.20% plus the higher of (1) the effective federal funds rate, (2) the one-month LIBOR rate or (3) zero percent |
* | Effective March 31, 2020, the SCA’s total commitment was increased from $900,000,000 to $1,162,500,000 and subsequently, effective April 7, 2020 was increased to $1,222,500,000. |
Certain affiliated registered investment companies that are parties to the SCA include portfolios that are subject to a predetermined mathematical formula used to manage certain benefit guarantees offered under variable annuity contracts. The formula may result in large scale asset flows into and out of these portfolios. Consequently, these portfolios may be more likely to utilize the SCA for purposes of funding redemptions. It may be possible for those portfolios to fully exhaust the committed amount of the SCA, thereby requiring the Manager to allocate available funding per a Board-approved methodology designed to treat the Funds in the SCA equitably.
The Series did not utilize the SCA during the reporting period ended April 30, 2020.
8. Risks of Investing in the Series
The Series’ risks include, but are not limited to, some or all of the risks discussed below:
Bond Obligations Risk: The Series’ holdings, share price, yield and total return may fluctuate in response to bond market movements. The value of bonds may decline for issuer-related reasons, including management performance, financial leverage and reduced demand for the issuer’s goods and services. Certain types of fixed-income obligations also may be subject to “call and redemption risk,” which is the risk that the issuer may call a bond held by the Series for redemption before it matures and the Series may not be able to reinvest at the same level and therefore would earn less income.
Derivatives Risk: Derivatives involve special risks and costs and may result in losses to the Series. The successful use of derivatives requires sophisticated management, and, to the extent that derivatives are used, the Series will depend on the subadviser’s ability to analyze and manage derivative transactions. The prices of derivatives may move in unexpected ways, especially in abnormal market conditions. Some derivatives are “leveraged” and therefore may magnify or otherwise increase investment losses to the Series. Other risks arise from the potential inability to terminate or sell derivatives positions. A liquid secondary
PGIM Emerging Markets Debt Hard Currency Fund | 51 |
Notes to Financial Statements (unaudited) (continued)
market may not always exist for the Series’ derivatives positions. In fact, many OTC derivative instruments will not have liquidity beyond the counterparty to the instrument. OTC derivative instruments also involve the risk that the other party will not meet its obligations to the Series.
Emerging Markets Risk: The risks of foreign investments are greater for investments in or exposed to emerging markets. Emerging market countries typically have economic and political systems that are less fully developed, and can be expected to be less stable, than those of more developed countries. For example, the economies of such countries can be subject to rapid and unpredictable rates of inflation or deflation. Low trading volumes may result in a lack of liquidity and price volatility.
Foreign Securities Risk: The Series’ investments in securities of foreign issuers or issuers with significant exposure to foreign markets involve additional risk. Foreign countries in which the Series may invest may have markets that are less liquid, less regulated and more volatile than US markets. The value of the Series’ investments may decline because of factors affecting the particular issuer as well as foreign markets and issuers generally, such as unfavorable government actions, and political or financial instability.
Interest Rate Risk: The value of an investment may go down when interest rates rise. A rise in rates tends to have a greater impact on the prices of longer term or duration securities. When interest rates fall, the issuers of debt obligations may prepay principal more quickly than expected, and the Series may be required to reinvest the proceeds at a lower interest rate. This is referred to as “prepayment risk.” When interest rates rise, debt obligations may be repaid more slowly than expected, and the value of the Series’ holdings may fall sharply. This is referred to as “extension risk”. The Series may face a heightened level of interest rate risk as a result of the U.S. Federal Reserve Board’s policies. The Series’ investments may lose value if short-term or long-term interest rates rise sharply or in a manner not anticipated by the subadviser.
Large Shareholder and Large Scale Redemption Risk: Certain individuals, accounts, funds (including funds affiliated with the Manager) or institutions, including the Manager and its affiliates, may from time to time own or control a substantial amount of the Series’ shares. There is no requirement that these entities maintain their investment in the Series. There is a risk that such large shareholders or that the Series’ shareholders generally may redeem all or a substantial portion of their investments in the Series in a short period of time, which could have a significant negative impact on the Series’ NAV, liquidity, and brokerage costs. Large redemptions could also result in tax consequences to shareholders and impact the Series’ ability to implement its investment strategy. The Series’ ability to pursue its investment objective after one or more large scale redemptions may be impaired and, as a result, the Series may invest a larger portion of its assets in cash or cash equivalents.
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Liquidity Risk: The Series may invest in instruments that trade in lower volumes and are less liquid than other investments. Liquidity risk exists when particular investments made by the Series are difficult to purchase or sell. Liquidity risk includes the risk that the Series may make investments that may become less liquid in response to market developments or adverse investor perceptions. Investments that are illiquid or that trade in lower volumes may be more difficult to value. If the Series is forced to sell these investments to pay redemption proceeds or for other reasons, the Series may lose money. In addition, when there is no willing buyer and investments may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment, the Series may incur higher transaction costs when executing trade orders of a given size. The reduction in dealer market-making capacity in the fixed-income markets that has occurred in recent years also has the potential to reduce liquidity. An inability to sell a portfolio position can adversely affect the Series’ value or prevent the Series from being able to take advantage of other investment opportunities.
Market and Credit Risk: Securities markets may be volatile and the market prices of the Series’ securities may decline. Securities fluctuate in price based on changes in an issuer’s financial condition and overall market and economic conditions. If the market prices of the securities owned by the Series fall, the value of an investment in the Series will decline. Additionally, the Series may also be exposed to credit risk in the event that an issuer or guarantor fails to perform or that an institution or entity with which the Series has unsettled or open transactions defaults.
Market Disruption and Geopolitical Risks: International wars or conflicts and geopolitical developments in foreign countries, along with instability in regions such as Asia, Eastern Europe, and the Middle East, possible terrorist attacks in the United States or around the world, public health epidemics such as the outbreak of infectious diseases like the recent outbreak of coronavirus globally or the 2014–2016 outbreak in West Africa of the Ebola virus, and other similar events could adversely affect the U.S. and foreign financial markets, including increases in market volatility, reduced liquidity in the securities markets and government intervention, and may cause further long-term economic uncertainties in the United States and worldwide generally.
Non-diversification Risk: A non-diversified Series may invest a greater percentage of its assets in the securities of a single company or industry than a diversified fund. Investing in a non-diversified fund involves greater risk than investing in a diversified fund because a loss resulting from the decline in value of any one security may represent a greater portion of the total assets of a non-diversified fund.
9. Recent Accounting Pronouncements and Reporting Updates
In August 2018, the FASB issued Accounting Standards Update (“ASU”) No. 2018-13, which changes certain fair value measurement disclosure requirements. The new ASU, in addition to other modifications and additions, removes the requirement to disclose the
PGIM Emerging Markets Debt Hard Currency Fund | 53 |
Notes to Financial Statements (unaudited) (continued)
amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the Series’ policy for the timing of transfers between levels. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Manager has evaluated the implications of certain provisions of the ASU and has adopted the aspects related to the removal and modification of certain fair value measurement disclosures under the ASU. The Manager continues to evaluate certain other provisions of the ASU and does not expect a material impact to financial statement disclosures.
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Financial Highlights (unaudited)
Class A Shares | ||||||||||||||||||||
Six Months 2020 | Year Ended October 31, 2019 | December 12, 2017(a) through October 31, 2018 | ||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $9.51 | $8.88 | $10.00 | |||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.21 | 0.46 | 0.38 | |||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.57 | ) | 0.69 | (1.06 | ) | |||||||||||||||
Total from investment operations | (1.36 | ) | 1.15 | (0.68 | ) | |||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||
Dividends from net investment income | (0.27 | ) | (0.52 | ) | (0.43 | ) | ||||||||||||||
Tax return of capital distributions | - | - | (0.01 | ) | ||||||||||||||||
Total dividends and distributions | (0.27 | ) | (0.52 | ) | (0.44 | ) | ||||||||||||||
Net asset value, end of period | $7.88 | $9.51 | $8.88 | |||||||||||||||||
Total Return(c): | (14.60)% | 13.23% | (6.97)% | |||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (000) | $11 | $13 | $9 | |||||||||||||||||
Average net assets (000) | $13 | $12 | $10 | |||||||||||||||||
Ratios to average net assets(d): | ||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.05% | (e) | 1.05% | 1.05% | (e) | |||||||||||||||
Expenses before waivers and/or expense reimbursement | 107.65% | (e) | 115.95% | 358.14% | (e) | |||||||||||||||
Net investment income (loss) | 4.74% | (e) | 4.95% | 4.49% | (e) | |||||||||||||||
Portfolio turnover rate(f) | 10% | 33% | 17% |
(a) | Commencement of operations. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 55 |
Financial Highlights (unaudited) (continued)
Class C Shares | ||||||||||||||||||||
Six Months 2020 | Year Ended October 31, 2019 | December 12, 2017(a) through October 31, 2018 | ||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $9.51 | $8.88 | $10.00 | |||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.18 | 0.39 | 0.31 | |||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.57 | ) | 0.69 | (1.05 | ) | |||||||||||||||
Total from investment operations | (1.39 | ) | 1.08 | (0.74 | ) | |||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||
Dividends from net investment income | (0.24 | ) | (0.45 | ) | (0.37 | ) | ||||||||||||||
Tax return of capital distributions | - | - | (0.01 | ) | ||||||||||||||||
Total dividends and distributions | (0.24 | ) | (0.45 | ) | (0.38 | ) | ||||||||||||||
Net asset value, end of period | $7.88 | $9.51 | $8.88 | |||||||||||||||||
Total Return(c): | (14.91)% | 12.40% | (7.58)% | |||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (000) | $9 | $10 | $9 | |||||||||||||||||
Average net assets (000) | $10 | $10 | $10 | |||||||||||||||||
Ratios to average net assets(d): | ||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 1.80% | (e) | 1.80% | 1.80% | (e) | |||||||||||||||
Expenses before waivers and/or expense reimbursement | 136.76% | (e) | 139.02% | 359.95% | (e) | |||||||||||||||
Net investment income (loss) | 3.98% | (e) | 4.22% | 3.73% | (e) | |||||||||||||||
Portfolio turnover rate(f) | 10% | 33% | 17% |
(a) | Commencement of operations. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
56 |
Class Z Shares | ||||||||||||||||||||
Six Months 2020 | Year Ended October 31, 2019 | December 12, 2017(a) through October 31, 2018 | ||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $9.51 | $8.88 | $10.00 | |||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.22 | 0.48 | 0.39 | |||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.55 | ) | 0.69 | (1.05 | ) | |||||||||||||||
Total from investment operations | (1.33 | ) | 1.17 | (0.66 | ) | |||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||
Dividends from net investment income | (0.29 | ) | (0.54 | ) | (0.45 | ) | ||||||||||||||
Tax return of capital distributions | - | - | (0.01 | ) | ||||||||||||||||
Total dividends and distributions | (0.29 | ) | (0.54 | ) | (0.46 | ) | ||||||||||||||
Net asset value, end of period | $7.89 | $9.51 | $8.88 | |||||||||||||||||
Total Return(c): | (14.38)% | 13.51% | (6.79)% | |||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (000) | $8,620 | $5,782 | $2,234 | |||||||||||||||||
Average net assets (000) | $7,608 | $3,498 | $766 | |||||||||||||||||
Ratios to average net assets(d): | ||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.76% | (e) | 0.80% | 0.80% | (e) | |||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.70% | (e) | 2.41% | 6.65% | (e) | |||||||||||||||
Net investment income (loss) | 4.97% | (e) | 5.12% | 4.83% | (e) | |||||||||||||||
Portfolio turnover rate(f) | 10% | 33% | 17% |
(a) | Commencement of operations. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
PGIM Emerging Markets Debt Hard Currency Fund | 57 |
Financial Highlights (unaudited) (continued)
Class R6 Shares | ||||||||||||||||||||
Six Months 2020 | Year Ended October 31, 2019 | December 12, 2017(a) through October 31, 2018 | ||||||||||||||||||
Per Share Operating Performance(b): | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $9.51 | $8.88 | $10.00 | |||||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.23 | 0.49 | 0.40 | |||||||||||||||||
Net realized and unrealized gain (loss) on investment and foreign currency transactions | (1.56 | ) | 0.69 | (1.06 | ) | |||||||||||||||
Total from investment operations | (1.33 | ) | 1.18 | (0.66 | ) | |||||||||||||||
Less Dividends and Distributions: | ||||||||||||||||||||
Dividends from net investment income | (0.29 | ) | (0.55 | ) | (0.45 | ) | ||||||||||||||
Tax return of capital distributions | - | - | (0.01 | ) | ||||||||||||||||
Total dividends and distributions | (0.29 | ) | (0.55 | ) | (0.46 | ) | ||||||||||||||
Net asset value, end of period | $7.89 | $9.51 | $8.88 | |||||||||||||||||
Total Return(c): | (14.34)% | 13.58% | (6.72)% | |||||||||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (000) | $22,734 | $26,493 | $23,333 | |||||||||||||||||
Average net assets (000) | $25,763 | $25,144 | $24,014 | |||||||||||||||||
Ratios to average net assets(d): | ||||||||||||||||||||
Expenses after waivers and/or expense reimbursement | 0.67% | (e) | 0.74% | 0.74% | (e) | |||||||||||||||
Expenses before waivers and/or expense reimbursement | 1.31% | (e) | 1.49% | 1.76% | (e) | |||||||||||||||
Net investment income (loss) | 5.12% | (e) | 5.27% | 4.82% | (e) | |||||||||||||||
Portfolio turnover rate(f) | 10% | 33% | 17% |
(a) | Commencement of operations. |
(b) | Calculated based on average shares outstanding during the period. |
(c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions, if any. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
(d) | Does not include expenses of the underlying funds in which the Series invests. |
(e) | Annualized. |
(f) | The Series’ portfolio turnover rate is calculated in accordance with regulatory requirements, without regard to transactions involving short-term investments and certain derivatives. If such transactions were included, the Series’ portfolio turnover rate may be higher. |
See Notes to Financial Statements.
58 |
Series Liquidity Risk Management Program (unaudited)
Consistent with Rule 22e-4 under the 1940 Act (the “Liquidity Rule”), the Series has adopted and implemented a liquidity risk management program (the “LRMP”). The Series’ LRMP seeks to assess and manage the Series’ liquidity risk, which is defined as the risk that the Series is unable to meet investor redemption requests without significantly diluting the remaining investors’ interests in the Series. The Series’ Board of Directors (the “Board”) has approved PGIM Investments LLC (“PGIM Investments”), the Series’ investment manager, to serve as the administrator of the Series’ LRMP. As part of its responsibilities as administrator, PGIM Investments has retained a third party to perform certain functions, including providing market data and liquidity classification model information.
The Series’ LRMP includes a number of processes designed to support the assessment and management of its liquidity risk. In particular, the Series’ LRMP includes no less than annual assessments of factors that influence the Series’ liquidity risk; no less than monthly classifications of the Series’ investments into one of four liquidity classifications provided for in the Liquidity Rule; a 15% of net assets limit on the acquisition of “illiquid investments” (as defined under the Liquidity Rule); establishment of a minimum percentage of the Series’ assets to be invested in investments classified as “highly liquid” (as defined under the Liquidity Rule) if the Series does not invest primarily in highly liquid investments; and regular reporting to the Series’ Board.
At a meeting of the Board of Directors on March 3-5, 2020, PGIM Investments provided a written report (“LRMP Report”) to the Board addressing the operation, adequacy, and effectiveness of the Series’ LRMP, including any material changes to the LRMP for the period from the inception of the Series’ program on December 1, 2018 through December 31, 2019 (“Reporting Period”). The LRMP Report concluded that the Series’ LRMP was reasonably designed to assess and manage the Series’ liquidity risk and was adequately and effectively implemented during the Reporting Period. There were no material changes to the LRMP during the Reporting Period. The LRMP Report further concluded that the Series’ investment strategies continue to be appropriate given the Series’ status as an open-end fund.
There can be no assurance that the LRMP will achieve its objectives in the future. Additional information regarding risks of investing in the Series, including liquidity risks presented by the Series’ investment portfolio, is found in the Series’ Prospectus and Statement of Additional Information.
PGIM Emerging Markets Debt Hard Currency Fund | 59 |
∎ TELEPHONE | ∎ WEBSITE | |||
655 Broad Street Newark, NJ 07102 | (800) 225-1852 | pgiminvestments.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s subadvisers the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Securities and Exchange Commission’s website. |
DIRECTORS |
Ellen S. Alberding • Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Barry H. Evans • Keith F. Hartstein • Laurie Simon Hodrick • Michael S. Hyland • Stuart S. Parker • Brian K. Reid • Grace C. Torres |
OFFICERS |
Stuart S. Parker, President • Scott E. Benjamin, Vice President • Christian J. Kelly, Treasurer and Principal Financial and Accounting Officer • Claudia DiGiacomo, Chief Legal Officer • Dino Capasso, Chief Compliance Officer • Charles H. Smith, Anti-Money Laundering Compliance Officer • Andrew R. French, Secretary • Jonathan D. Shain, Assistant Secretary • Melissa Gonzalez, Assistant Secretary • Diana N. Huffman, Assistant Secretary • Kelly A. Coyne, Assistant Secretary • Lana Lomuti, Assistant Treasurer • Russ Shupak, Assistant Treasurer • Elyse McLaughlin, Assistant Treasurer • Deborah Conway, Assistant Treasurer |
MANAGER | PGIM Investments LLC | 655 Broad Street Newark, NJ 07102 | ||
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SUBADVISERS | PGIM Fixed Income
PGIM Limited | 655 Broad Street Newark, NJ 07102
Grand Buildings, 1-3 Strand | ||
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DISTRIBUTOR | Prudential Investment Management Services LLC | 655 Broad Street Newark, NJ 07102 | ||
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CUSTODIAN | The Bank of New York Mellon | 240 Greenwich Street | ||
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TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | PricewaterhouseCoopers LLP | 300 Madison Avenue New York, NY 10017 | ||
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FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 | ||
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An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and other information about the Fund. An investor may obtain the prospectus and summary prospectus by visiting our website at pgiminvestments.com or by calling (800) 225-1852. The prospectus and summary prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to pgiminvestments.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via email when new materials are available. You can cancel your enrollment or change your email address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, PGIM Emerging Markets Debt Hard Currency Fund, PGIM Investments, Attn: Board of Directors, 655 Broad Street, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO HOLDINGS |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT filings are available on the Commission’s website at sec.gov. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
PGIM EMERGING MARKETS DEBT HARD CURRENCY FUND
SHARE CLASS | A | C | Z | R6 | ||||
NASDAQ | PDHAX | PDHCX | PDHVX | PDHQX | ||||
CUSIP | 743969479 | 743969461 | 743969446 | 743969453 |
MF239E2
Item 2 – Code of Ethics — Not required, as this is not an annual filing.
Item 3 – Audit Committee Financial Expert – Not required, as this is not an annual filing.
Item 4 – Principal Accountant Fees and Services – Not required, as this is not an annual filing.
Item 5 – Audit Committee of Listed Registrants – Not required, as this is not an annual filing.
Item 6 – Schedule of Investments – The schedule is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not applicable.
Item 8 – Portfolio Managers of Closed-End Management Investment Companies – Not applicable.
Item 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not applicable.
Item 10 – Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.
Item 11 – Controls and Procedures
(a)It is the conclusion of the registrant's principal executive officer and principal financial officer that the effectiveness of the registrant's current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission's rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant's principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.
(b)There has been no significant change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter of the period covered by this report that has materially affected, or is likely to materially affect, the registrant's internal control over financial reporting.
Item 12 – Controls and Procedures - Disclosure of Securities Lending Activities for Closed-End Management Investment Companies – Not applicable.
Item 13 – Exhibits
(a)(1) Code of Ethics – Not required, as this is not an annual filing.
(2)Certifications pursuant to Section 302 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.CERT.
(3)Any written solicitation to purchase securities under Rule 23c-1. – Not applicable.
(4)Registrant's Independent Public Accountant, attached as Exhibit 99.ACCT.
(b)Certifications pursuant to Section 906 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: | Prudential World Fund, Inc. |
By: | /s/ Andrew R. French |
| Andrew R. French |
| Secretary |
Date: | June 17, 2020 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/ Stuart S. Parker |
| Stuart S. Parker |
| President and Principal Executive Officer |
Date: | June 17, 2020 |
By: | /s/ Christian J. Kelly |
| Christian J. Kelly |
| Treasurer and Principal Financial and Accounting Officer |
Date: | June 17, 2020 |