Advanced Series Trust AST Academic Strategies Asset ... - Prudential

■
■
Step 1: Begin with the stocks that comprise the NASDAQ-100 Index. Rank each stock on the following factors:
- 12 month price appreciation
- 6 month price appreciation
- Return on assets
- Price to cash flow
Step 2: Select a market-cap weighted portfolio of the 15 stocks with the best overall ranking on the four factors.
Securities selected by this strategy will be weighted by market capitalization subject to the restriction that no stock will comprise less
than 1% or more than 7.5% of the portfolio on or about the security selection date.
Asset Class Allocations. In addition to allocating each Portfolio’s assets across the six investment strategies, the overall mix between
equity and fixed-income securities will vary for both Portfolios. The AST First Trust Balanced Target Portfolio will normally invest
approximately 65% of its net assets in equity securities and 35% in fixed-income securities as of the security selection date.
Depending on market conditions on the security selection date, the equity portion may range between 60-70% and the fixed-income
portion between 30-40%. The AST First Trust Capital Appreciation Target Portfolio will normally invest approximately 80% of its net
assets in equity securities and 20% in fixed-income securities as of the securities selection date. Depending on market conditions on
the security selection date, the equity portion may range between 75-85% and the fixed-income portion between 15-25%.
Equity Securities. Each Portfolio invests a substantial portion of its assets in equity securities. Eligible equity securities include
common stocks, warrants to purchase common stocks, and securities convertible into common stocks (such as convertible bonds and
debentures). In addition, the Portfolios may invest in equity securities of foreign issuers, including depositary receipts that represent
foreign common stocks deposited with a custodian.
Fixed-Income Securities. Each Portfolio may invest in debt obligations of varying quality, including securities issued or guaranteed by
the U.S. Government and its agencies, and debt obligations issued by U.S. companies, foreign companies and foreign governments
and their agencies. The Portfolios will limit their respective investments to debt obligations rated at least investment grade by Moody’s
Investors Service (Moody’s), Standard Poor’s Ratings Services (S&P), or another major rating service, and unrated debt obligations that
First Trust believes are comparable in quality.
Other Investments and Investment Strategies for the Portfolios. In addition to the principal investment strategies outlined above, the
Portfolios may invest in the following instruments and use the following investment methods:
■ Common and Preferred Stocks
■ Fixed-Income Securities
■ Foreign Securities
■ Derivative Instruments
■ Initial Public Offerings
■ Warrants
■ Convertible Securities
■ When-Issued, Delayed-Delivery, or Forward Commitment Transactions
■ Illiquid and Restricted Securities
■ Repurchase Agreements
■ Reverse Repurchase Agreements
■ Temporary Investments· Borrowing
■ Lending Portfolio Securities
■ Short Sales “Against the Box”
LICENSES AND MISCELLANEOUS INFORMATION
“Dow Jones Corporate Bond Index,” “The Dow Jones Industrial Average SM ,” “The Dow ® ,” “DIJA SM “ and “Dow Jones U.S. Select
Dividend Index SM “ are products of Dow Jones Indexes, licensed trademarks of CME Group Index Services LLC (“CME”), and have
been licensed for use. “Dow Jones ® “, “Dow Jones Corporate Bond Index,” “The Dow Jones Industrial Average SM ,” “The Dow ® ,”
“DIJA SM ,” “Dow Jones U.S. Select Dividend Index SM ,” and “Dow Jones Indexes” are service marks of Dow Jones Trademark Holdings,
LLC (“Dow Jones”), have been licensed to CME, and have been sublicensed for use for certain purposes by First Trust Advisors, L.P
(“First Trust,” or “Licensee”). The AST First Trust Balanced Target Portfolio and AST First Trust Capital Appreciation Target Portfolio
(collectively, “the Portfolios”) are not sponsored, endorsed, sold or promoted by Dow Jones, CME or their respective affiliates. Dow
Jones, CME and their respective affiliates make no representation or warranty, express or implied, to the owners of the Portfolios or
any member of the public regarding the advisability of investing in securities generally or in the AST First Trust Balanced Target
Portfolio and AST First Trust Capital Appreciation Target Portfolio particularly. The only relationship of Dow Jones, CME or any of their
respective affiliates to the Licensee is the licensing of certain trademarks, trade names and service marks of Dow Jones and of the
226