Prudential Adds Three New Hybrid Sector Portfolios to Mutual Fund Family

Business Wire, May 26, 1999

NEWARK, N.J.--(BUSINESS WIRE)--May 26, 1999--

Prudential Technology Fund, Prudential Health Sciences Fund and Financial Services Fund Combine Concentrated Sector Investment and Enhanced Index Allocation

Prudential Investments, a unit of the Prudential Insurance Company of America, today announced the introduction of three new sector mutual funds: Prudential Technology Fund, Prudential Health Sciences Fund and Prudential Financial Services Fund. These funds are non-diversified, which means they are concentrated in one specific industry, plus the managers can invest more than 5% of assets in the securities of any one issuer.

"At Prudential, we believe one way for investors to achieve long-term investment performance is to invest in the industries driving today's economy. Prudential's new sector funds enable mutual fund investors to do just that, " said Neil McGuinness, executive vice president, Prudential Investments.

Each fund is divided into two sub-portfolios with half of the assets actively managed in a concentrated style and half-managed in an enhanced index style. The concentrated portfolio will focus on 20 to 40 stocks that managers believe will offer the best potential growth. The enhanced index portfolio contains securities of the fund's focus industry selected from the S&P SuperComposite 1500 Index, a benchmark index which combines the S&P 500, S&P 400 and S&P 600 Indices, and represents 87% of the United States total market capitalization.

These new funds seek to capitalize on the potential benefits of investing in specific sectors believed to be driving the economy, while at the same time attempting to limit downside risk through equal investment in an enhanced index approach. Historically, active management and index investing have each been successful, but one or the other has delivered higher returns over a given period.1 By investing in both styles at once, the fund may have part of its portfolio in the dominant approach at all times.

Prudential Technology Fund - will seek to provide investors with long term capital appreciation. Susan Hirsch and Jeff Rose will be responsible for sector stock selection. Ms. Hirsch has over 22 years of investment experience with a particular expertise in identifying fast growing companies. Mr. Rose is also a growth oriented manager with over 12 years of investment experience. Ted Lockwood will lead the quantitative management team of the fund's enhanced index portfolio.

Prudential Health Sciences Fund - will seek to provide investors with long term capital growth. Kathleen McCarragher and David Chan will manage sector stock selection. Ms. McCarragher has over 17 years of investment experience, and Mr. Chan has a degree in biochemistry from Harvard and specializes in the securities of healthcare sector companies. John Van Belle will lead the quantitative management of the fund's enhanced index portfolio.

Prudential Financial Services Fund - will seek to provide investors with long term capital appreciation. The fund will be co-managed by Patrick J. O'Brien and Mark Stumpp. Mr. O'Brien will be responsible for sector stock selection, while Mr. Stumpp will lead the quantitative management team of the fund's enhanced index portfolio. Mr. O'Brien is a vice president in the value equity team at Prudential Investments and has over 17 years of investment experience. The quantitative management team consists of over 17 professionals with more than 200 years of combined investment experience.

The initial offering period for the Prudential Sector Funds begins on May 26, 1999 and ends on June 25, 1999. The first trade date after settlement of the initial offering is July 22, 1999. The funds are also eligible for coverage by PruTector, an optional group term life insurance product that protects the value of investors' assets in both rising and falling markets for their beneficiaries.

The introduction of these funds is the latest in a series of successful moves at Prudential Investments. The Prudential 20/20 Focus Fund, introduced in 1998, has raised more than $870 million to date, and the Prudential Tax-Managed Equity Fund which launched in March, has raised nearly $310 million to date.

These new funds, and Prudential's other mutual funds, may be purchased from the 6,100 financial advisors of Prudential Securities, Incorporated, and the 8,800 representatives of Pruco Securities Corporation.

Prudential Investments is the investment products and wholesale distribution division of The Prudential Insurance Company of America, providing investment management services for individuals through mutual funds, annuities and wrap fee products. Prudential Investments has $90 billion in assets under management, with more than 2.5 million shareholders investing in more than 60 funds. Prudential has $334 billion in assets under management as of 12/31/98.

1. Source: Standard & Poors as of 3/31/99.

Note: PruTector is optional group term life insurance (Contract series No.97891) issued by The Prudential Insurance Company of America, Newark, NJ. PruTector is not available in certain states including New York and Utah.