PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS, N-1A EL, 1995-12-15

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
N-1A EL, 1995-12-15

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As filed with the Securities and Exchange Commission on December 6, 1995
Registration No. [TBA]
File No. [TBA]

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. []
Post-Effective Amendment No. []
and/or
REGISTRATION STATEMENT
Under
THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. []
(Check appropriate box or boxes.)

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
56 Prospect Street, Hartford, Connecticut 06115
-----------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(800) 814-1897
--------------
(Registrant's Telephone Number, including Area Code)
Philip R. McLoughlin
Vice Chairman and Chief Executive Officer
Phoenix Duff & Phelps Corporation
56 Prospect Street
Hartford, Connecticut 06115
---------------------------
(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering: It is proposed that this filing
will become effective as soon as practicable after Registration Statement
becomes effective.

Declaration Pursuant to Rule 24f-2: Registrant hereby registers an indefinite
number of shares of beneficial interest, $1 par value, under the Securities Act
of 1933 pursuant to Rule 24f-2 under the Investment Company Act of 1940 for the
fiscal year ended December 31, 1996.

The Registrant hereby amends this Registration Statement on such date(s) as may
be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date that the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.

<PAGE>

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
[Cross Reference Sheet Pursuant to Rule 495(a)]

PART A
<TABLE>
<CAPTION>
Form N-1A Item No. Prospectus Caption
- ------------------ ------------------
<S> <C> <C>
1. Cover Page Cover Page
2. Synopsis Introduction; Fund Expenses
3. Condensed Financial Information Financial Highlights
4. General Description of Registrant
Introduction;
Management of the Fund
5. Management of the Fund Management of the Fund;
Custodian and Transfer Agent
6. Capital Stock and Other Securities Management of the Fund;
Description of Shares;
Dividends, Distributions and Taxes;
Additional Information
7. Purchase of Securities Being Offered How to Buy Shares; Net Asset
Value; National Distributor and
Distribution Plan; How to Redeem
Shares
8. Redemption or Repurchase How to Buy Shares; How
to Redeem Shares
9. Pending Legal Proceedings Not Applicable

PART B

Form N-1A Item No.

10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History Not Applicable
13. Investment Objectives and Policies Investment Policies; Investment
Restrictions; Portfolio Turnover
14. Management of the Registrant Management of the Trust
15. Control Persons and Principal
Holders of Securities Management of the Trust
16. Investment Advisory and Other
Services Management of the Trust;
Investment Adviser; The National
Distributor and Distribution Plan;
Financial Statements
17. Brokerage Allocation Brokerage Allocation

<PAGE>

18. Capital Stock and Other Securities Purchase of Shares; How to Redeem
Shares
19. Purchase, Redemption and Pricing
of Securities Being Offered Determination of Net
Asset Value; Purchase of
Shares; How to Redeem Shares
20. Tax Status Taxes
21. Underwriter The National Distributor
and Distribution Plan
22. Calculation of Yield Quotations of
Money Market Fund Performance Information
23. Financial Statements Financial Statements

</TABLE>

<PAGE>

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
56 Prospect Street
Hartford, Connecticut 06115
(800) 814-1897

PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION

DATE OF ISSUANCE: DECEMBER 6, 1995

APPROXIMATE DATE OF FIRST SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE REGISTRATION STATEMENT BECOMES
EFFECTIVE

Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

<PAGE>
PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
56 Prospect Street
Hartford, Connecticut 06115
(800) 814-1897

PROSPECTUS
[February 1], 1996

Phoenix Duff & Phelps Institutional Mutual Funds (the "Fund") is a diversified,
open-end management investment company whose shares are presently offered in six
separate series. Each series generally operates as a separate fund with its own
investment objectives and policies designed to meet its specific investment
goals.

Phoenix Duff & Phelps Balanced Fund ("Balanced Fund") seeks as its
investment objectives reasonable income, long-term capital growth and
conservation of capital. It is intended that this Series will invest in
common stocks and fixed income securities, with emphasis on
income-producing securities which appear to the Adviser to have
potential for capital appreciation.

Phoenix Duff & Phelps Bond Fund ("Bond Fund") seeks as its investment
objective high current income and appreciation of capital, consistent
with prudent investment risk. It is intended that this Series will
invest primarily in a diversified portfolio of investment grade fixed
income securities.

Phoenix Duff & Phelps Enhanced Reserves Fund ("Enhanced Reserves Fund")
seeks as its investment objective high current income consistent with
preservation of capital. It is intended that the Series will invest
primarily in U.S. government securities and high grade corporate debt
obligations.

Phoenix Duff & Phelps Growth Stock Fund ("Growth Fund") seeks as its
investment objective long-term appreciation of capital. Since income is
not an objective, any income generated by the investment of this
Series' assets will be incidental to its objective. It is intended that
this Series will invest primarily in the common stocks which have
potential for capital appreciation.

Phoenix Duff & Phelps Money Market Fund ("Money Market Fund") seeks as
its investment objective as high a level of current income as is
consistent with the preservation of capital and the maintenance of
liquidity. It is intended that this Series will invest primarily in a
portfolio of high-quality money market instruments generally maturing
in less than 397 days. An investment in the Money Market Fund is
neither insured nor guaranteed by the U.S. Government and there can be
no assurance that the Fund will be able to maintain a stable net asset
value of $1.00 per share.

Phoenix Duff & Phelps U.S. Government Securities Fund ("U.S. Government
Securities Fund") seeks as its investment objective a high level of
current income consistent with safety of principal. It is intended that
this Series will invest primarily in a diversified portfolio of
securities having a duration of approximately three years. The
securities will be issued or guaranteed by the U.S. Government or its
agencies and backed by the full faith and credit of the U.S. Government
or supported by the ability to borrow from the U.S. Treasury or by the
credit of an agency or otherwise supported by the U.S. Government.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. No dealer, salesman or other
person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, and, if given or
made, such other information or representations must not be relied upon as
having been authorized by the Fund, the Adviser, or the Distributor. This
Prospectus does not constitute an offer to sell or solicitation of an offer to
buy any of the securities offered hereby in any state in which or to any person
whom it is unlawful to make such offer. Investors should read and retain this
Prospectus for future reference. Additional information about the Fund is
contained in the Statement of Additional Information dated [February 1], 1996
which has been filed with the Securities and Exchange Commission and is
available at no charge by calling (800) 814-1897 or by writing to Phoenix Equity
Planning Corporation, at 100 Bright Meadow Boulevard, P.O. Box 2200, Enfield,
Connecticut 06083-2200. The Statement of Additional Information is incorporated
herein by reference.

LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>

TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
INTRODUCTION 1
FUND EXPENSES 2
FINANCIAL HIGHLIGHTS 4
PERFORMANCE INFORMATION 4
INVESTMENT OBJECTIVES AND POLICIES 6
Phoenix Duff & Phelps Balanced Fund 6
Phoenix Duff & Phelps Bond Fund 6
Phoenix Duff & Phelps Enhanced Reserves Fund 7
Phoenix Duff & Phelps Growth Stock Fund 7
Phoenix Duff & Phelps Money Market Fund 8
Phoenix Duff & Phelps U.S. Government Securities Fund 9
INVESTMENT TECHNIQUES AND RELATED RISKS 9
INVESTMENT RESTRICTIONS 13
MANAGEMENT OF THE FUND 13
NATIONAL DISTRIBUTOR AND DISTRIBUTION PLAN 16
DESCRIPTION OF SHARES 17
HOW TO BUY SHARES 18
NET ASSET VALUE 19
HOW TO REDEEM SHARES 20
DIVIDENDS, DISTRIBUTIONS AND TAXES 20
ADDITIONAL INFORMATION 21
APPENDIX 23
</TABLE>

<PAGE>

INTRODUCTION

This Prospectus describes the shares offered by and the operations of Phoenix
Duff & Phelps Institutional Mutual Funds (the "Fund"). The Fund is a
diversified, open-end management investment company established as a
Massachusetts business trust pursuant to an Agreement and Declaration of Trust
dated December 4, 1995, as amended from time to time. The Fund presently
consists of six separate series (the "Series"). Each Series has a different
investment objective and invests primarily in certain types of securities and is
designed to meet different investment needs.

The Investment Advisers

Phoenix Investment Counsel, Inc. ("PIC") serves as investment adviser to the
Balanced Fund, Bond Fund, Growth Fund, Money Market Fund, and U.S. Government
Securities Fund. PIC is a subsidiary of Phoenix Duff & Phelps Corporation and,
prior to November 1, 1995, was an indirect subsidiary of Phoenix Home Life
Mutual Insurance Company. For managing, or directing the investments of the
following Series, PIC is entitled a monthly fee at the following annual rates
based upon the average aggregate daily net asset values of each such Series up
to $1 billion: (a) 0.[ ]% of the average of the aggregate daily net asset values
of the Growth Fund; (b) 0.[ ]% of the average of the aggregate daily net asset
values of the Balanced Fund; (c) 0.[ ]% of the average of the aggregate daily
net asset values of the Bond Fund; (d) 0.[ ]% of the average of the aggregate
daily net asset values of the Money Market Fund; and, (e) 0.[ ]% of the average
of the aggregate daily net asset values of the U.S. Government Securities Fund.
Advisory fees for a Series shall decrease by five basis points at such time as
the average aggregate daily net asset value of such Series exceeds $1 billion.
See "Management of the Fund."

Duff & Phelps Investment Management Co. ("DPM") serves as investment adviser to
the Enhanced Reserves Fund. DPM is a subsidiary of Phoenix Duff & Phelps
Corporation. DPM is entitled to a monthly fee for managing, or directing the
investments of the Enhanced Reserves Fund, at the annual rate of 0.[ ]% of the
average aggregate daily net asset values of such Series up to $1 billion.
Advisory fees shall decrease by five basis points at such time as the average
aggregate daily net asset value of such Series exceeds $1 billion. PIC and DPM
are sometimes collectively referred to as the "Adviser."

The Distributor and Distribution Plan

Phoenix Equity Planning Corporation ("Equity Planning" or "Distributor"), serves
as National Distributor of the Fund's shares. See "National Distributor and
Distribution Plan" and the Statement of Additional Information. Equity Planning
also acts as financial agent and the Fund's transfer agent (the "Transfer
Agent").

The Fund has adopted a distribution plan for Class Y Shares pursuant to Rule
12b-1 under the Investment Company Act of 1940 (the "1940 Act"). Accordingly,
the distribution plan adopted for Class Y Shares provides that the Fund shall
reimburse the National Distributor up to a maximum annual rate of 0.25% of the
Fund's average daily Class Y Share net assets of a Series for distribution
expenses incurred in connection with the sale and promotion of Class Y Shares
for furnishing shareholder services. See "Distribution Plan."

Purchase of Shares

Each Series is currently authorized to offer two classes of shares on a
continuous basis. Class X Shares are available to Plans and Institutions (as
hereafter defined) which initially purchase shares of the Fund whose net asset
value exceeds $5 million. Class Y Shares are offered to Plans and Institutions
which initially purchase shares of the Fund whose net asset value exceeds $1
million. "Plans" are defined as corporate and governmental pension plans.
"Institutions" are defined as non-profit investors such as endowment funds and
other tax-exempt organizations. Shares of each class represent an identical
interest in the investment portfolio of a Series, and generally have the same
rights except that Class Y Shares bear the cost of higher distribution fees
which cause the Class Y Shares to have a higher expense ratio and to receive
lower dividends than Class X Shares. See "How To Buy Shares."

Risk Factors

There can be no assurance that any Series will achieve its respective investment
objectives. In addition, special risks may be presented by the particular types
of securities in which a Series may invest. To the extent that a Series invests
in lowerrated securities, such an investment is speculative and involves risks
not associated with investment in higher-rated securities, including overall
greater risk of non-payment of interest and principal and potentially greater
sensitivity to general economic conditions and changes in interest rates. As a
result of a Series' investment in the stock market, net asset values of such
Series will fluctuate in response to changes in the market and economic
conditions, as well as the financial condition and prospects of issuers in which
such Series invests. The risk factors relevant to investment in each Series
should be reviewed and are set forth in the "Investment Objectives and Policies"
and "Investment Techniques and Related Risks" sections of this Prospectus and
Statement of Additional Information.

<PAGE>

FUND EXPENSES

The following table illustrates all pro-forma expenses and fees that a
shareholder is expected to incur.

Class X Shares
<TABLE>
<CAPTION>
Money U.S. Gov't Enhanced
Balanced Growth Bond Market Securities Reserves
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Shareholder
Transaction Expenses:
Maximum Sales Load
Imposed on Purchases
(as a percentage of
offering price) None None None None None None
Maximum Sales Load
Imposed on Reinvested
Dividends None None None None None None
Deferred Sales Load None None None None None None
Redemption Fees None None None None None None
Exchange Fee None None None None None None

Annual Fund Operating Expenses
(as a percentage of average
net assets)
Management Fees
After Reimbursement 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(b)
12b-1 Fees None None None None None None
Other Expenses (c) 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]%
Total Fund Operating Expenses 0.65% 0.70% 0.55% 0.35% 0.40% 0.34%
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(a) Phoenix Investment Counsel, Inc. has voluntarily agreed to reimburse or
waive Total Fund Operating Expenses of Class X Shares of each Series (other than
the Enhanced Reserves Fund),excluding interest, taxes, brokerage fees,
commissions and extraordinary expenses, until December 31, 2001, to the extent
that such expenses exceed: 0.70% of the average annual net asset values of the
Growth Fund; 0.65% of the average annual net asset values of the Balanced Fund;
0.55% of the average annual net asset values of the Bond Fund; 0.35% of the
average annual net asset values of the Money Market Fund; and 0.40% of the
average annual net asset values of the U.S. Government Securities Fund. For the
period ended December 31, 1995, Total Fund Operating Expenses would be [ ] %,
[ ]%, [ ]%, [ ]% and [ ]% for the Balanced, Bond, Growth, Money Market and U.S.
Government Securities Funds, respectively, absent such reimbursement or waiver.
(b) Duff & Phelps Investment Management Co. has voluntarily agreed to reimburse
or waive Total Fund Operating Expenses of Class X Shares of the Enhanced
Reserves Fund, excluding interest, taxes, brokerage fees, commissions and
extraordinary expenses, until December 31, 1996, to the extent that such
expenses exceed: 0.34% of the average annual net asset values. For the period
ended December 31, 1995, Total Fund Operating Expenses for the Enhanced Reserves
Fund would be [ ] % absent such reimbursement or waiver.
(c) Based on estimated amounts for the current fiscal year.

<PAGE>

Class Y Shares
<TABLE>
<CAPTION>
Money U.S. Gov't Enhanced
Balanced Growth Bond Market Securities Reserves
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Shareholder
Transaction Expenses:
Maximum Sales Load
Imposed on Purchases
(as a percentage of
offering price) None None None None None None
Maximum Sales Load
Imposed on Reinvested
Dividends None None None None None None
Deferred Sales Load None None None None None None
Redemption Fees None None None None None None
Exchange Fee None None None None None None

Annual Fund Operating Expenses
(as a percentage of average
net assets)
Management Fees
After Reimbursement 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(a) 0.[ ]%(b)
12b-1 Fees (c) 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses (d) 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]% 0.[ ]%
Total Fund Operating Expenses 0.90% 0.95% 0.80% 0.60% 0.65% 0.59%
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(a) Phoenix Investment Counsel, Inc. has voluntarily agreed to reimburse or
waive Total Fund Operating Expenses of Class Y Shares of each Series (other than
the Enhanced Reserves Fund),excluding interest, taxes, brokerage fees,
commissions and extraordinary expenses, until December 31, 2001, to the extent
that such expenses exceed: 0.95% of the average annual net asset values of the
Growth Fund; 0.90% of the average annual net asset values of the Balanced Fund;
0.80% of the average annual net asset values of the Bond Fund; 0.60% of the
average annual net asset values of the Money Market Fund; and 0.65% of the
average annual net asset values of the U.S. Government Securities Fund. For the
period ended December 31, 1995, Total Fund Operating Expenses would be [ ] %, [
]%, [ ]%, [ ]% and [ ]% for the Balanced, Bond, Growth, Money Market and U.S.
Government Securities Funds, respectively, absent such reimbursement or waiver.
(b) Duff & Phelps Investment Management Co. has voluntarily agreed to reimburse
or waive Total Fund Operating Expenses of Class Y Shares of the Enhanced
Reserves Fund, excluding interest, taxes, brokerage fees, commissions and
extraordinary expenses, until December 31, 1996, to the extent that such
expenses exceed: 0.59% of the average annual net asset values. For the period
ended December 31, 1995, Total Fund Operating Expenses for the Enhanced Reserves
Fund would be [ ] % absent such reimbursement or waiver. (a) Long-term
shareholders may pay more in Rule 12b-1 fees than the equivalent of the maximum
front-end sales charges otherwise permitted by the National Association of
Securities Dealers, Inc. (b) Based on estimated amounts for the current fiscal
year.

<PAGE>

Example*
Cumulative Expenses Paid for the Period
1 year 3 years

An investor would pay the following expenses on a
$1,000 investment assuming (1) 5% annual return and
(2) redemption at the end of each time period:

Balanced Fund
Class X Shares $[ ] $[ ]
Class Y Shares [ ] [ ]
Bond Fund
Class X Shares [ ] [ ]
Class Y Shares [ ] [ ]
Enhanced Reserves Fund
Class X Shares [ ] [ ]
Class Y Shares [ ] [ ]
Growth Fund
Class X Shares [ ] [ ]
Class Y Shares [ ] [ ]
Money Market Fund
Class X Shares [ ] [ ]
Class Y Shares [ ] [ ]
U.S. Government Securities Fund
Class X Shares [ ] [ ]
Class Y Shares [ ] [ ]

*The purpose of the table above is to help the investor understand the various
costs and expenses that the investor will bear directly or indirectly. The
example should not be considered a representation of past or future expenses.
Actual expenses may be greater or less than those shown. For additional
information regarding various costs and expenses, see "Management of the Fund,"
and "How to Buy Shares."

FINANCIAL HIGHLIGHTS

The following tables illustrate certain financial information for each Series
(other than Enhanced Reserves Fund) for the period ended December 31, 1995. The
financial information set forth below has been audited by [] independent
accountants. Their opinion and Financial Statements and notes thereto will be
incorporated by reference in the Statement of Additional Information. The
Statement of Additional Information and the Annual Report of Pooled Separate
Accounts for the year ended December 31, 1995 (pertaining to all Series other
than Enhanced Reserves Fund) are available at no charge upon request by calling
(800) 817-1897.

[Tables to be Supplied]

PERFORMANCE INFORMATION

The Fund may, from time to time, include the performance history of any or all
of the Series (and each Class thereof) in advertisements, sales literature or
reports to current or prospective shareholders. Both yield and total return
figures are computed separately for Class X and Class Y Shares of each Series in
accordance with formulas specified by the Securities and Exchange Commission.

Performance information about the Balanced, Bond, Growth and U.S. Government
Series is based on each such Series' past performance as a separate investment
account of Phoenix Home Life Mutual Insurance Company prior to March 1, 1996.

<PAGE>

This performance data may be relevant as each such separate account was managed,
in all material respects, using substantially the same investment objectives,
policies and restrictions as those used by such Series. Standardized average
annual total return of each Class shall be calculated for the preceding one,
five and ten year periods (or since inception of the applicable separate account
if it has been in existence less than five or ten years) by including the
corresponding separate account's total return calculated in accordance with
formulas specified by the Securities and Exchange Commission. The performance of
the separate accounts has been restated to reflect the deduction of the fees and
expenses of the classes of the corresponding Series described in this
Prospectus.

Except as above stated, standardized quotations of average annual total return
for each class of shares of each Series will be expressed in terms of the
average annual compounded rate of return of a hypothetical investment in either
Class X or Class Y Shares of each Series over a period of 1, 5, and 10 years (or
up to the life of the class of shares). Standardized total return quotations
reflect the deduction of a proportional share of each Class's expenses of such
Series (on an annual basis), and assume that all dividends and distributions are
reinvested when paid. It is expected that the performance of Class X Shares
shall be better than that of Class Y Shares as a result of lower distribution
fees and certain incrementally lower expenses paid by Class X Shares. The Fund
may also quote supplementally a rate of total return over different periods of
time by means of aggregate, average, and year-by-year or other types of total
return figures.

Performance information may be expressed as yield, effective yield and total
return of either class of the Money Market Fund. Current yield for the Money
Market Fund will be based on the income earned by the Series (or Class) over a
given 7-day period (less a hypothetical charge reflecting deductions for
expenses taken during the period) and then annualized, i.e., the income earned
in the period is assumed to be earned every seven days over a 52-week period and
is stated in terms of an annual percentage return on the investment. Effective
yield is calculated similarly but reflects the compounding effect of earnings on
reinvested dividends.

The yield of each Series (other than the Money Market Fund) will be computed by
dividing the Series' net investment income over a 30-day period by an average
value of invested assets (using the average number of shares entitled to receive
dividends and the maximum offering price per share at the end of the period),
all in accordance with applicable regulatory requirements. Such amount will be
compounded for six months and then annualized for a twelve-month period to
derive the Series' yield.

Advertisements, sales literature and other communications may contain
information about the Fund or Adviser's current investment strategies and
management style. Current strategies and style may change to respond to a
changing market and economic conditions. From time to time, the Fund may discuss
specific portfolio holdings or industries in such communications. To illustrate
components of overall performance, the Fund may separate its cumulative and
average annual returns into income results and capital gains or losses; or cite
separately as a return figure the equity or bond portion of a Series' portfolio;
or compare a Series' equity or bond return figure to well-known indices of
market performance including but not limited to: the Standard &Poor's 500 Stock
Index, Dow Jones Industrial Average, and Salomon Brothers Corporate and
Government Bond Indices.

Performance information for the Series (and each Class thereof) reflects only
the performance of a hypothetical investment in a Class X Shares or Class Y
Shares of a Series during the particular time period in which the calculations
are based. Performance information is not an indication of future performance.
Performance information should be considered in light of a particular Series'
investment objectives and policies, characteristics and qualities of the Series,
and the market conditions during the given time period, and should not be
considered as a representation of what may be achieved in the future. Investment
results will vary from time to time and are not identical to the past portfolio
investments of those Series which previously existed as separate accounts. For a
description of the methods used to determine total return, see the Statement of
Additional Information. The Fund's Annual Report, available upon request and
without charge, shall contain a discussion of the performance of each Series and
a comparison of that performance to a securities market index.

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES

Each Series has a different investment objective and is designed to meet
different investment needs. The differences in objectives and policies among the
Series can be expected to affect the investment return of each Series and the
degree of market and financial risk to which each Series is subject. The
investment objective of each Series is a fundamental policy which may not be
changed without the approval of a vote of a majority of the outstanding shares
of that Series. Risks are inherent in the ownership of any security and there
can be no assurance that any Series will achieve its investment objective. The
investment policies of each Series will also affect the rate of portfolio
turnover. A high rate of portfolio turnover generally involves correspondingly
greater brokerage commissions or transaction costs, which are paid directly by
the Series. The rate for each Series, except the Money Market Fund (which does
not normally pay brokerage commissions), is included under "Financial
Highlights."

Phoenix Duff & Phelps Balanced Fund

The investment objective of the Balanced Fund is to seek reasonable income,
long-term capital growth and conservation of capital. The Series intends to
invest based on combined considerations of risk, income, capital enhancement and
protection of capital value.

It is intended that the Series may invest in any type or class of security. The
Series will invest in common stocks and fixed income securities. The Series may
also invest in securities convertible into common stocks. At least 25% of the
value of its assets will be invested in fixed income securities. The Series
intends to emphasize fixed income securities which are rated within the four
highest categories by recognized rating agencies (i.e., Standard & Poor's
Corporation, Moody's Investors Service, Inc., Duff & Phelps Credit Rating Co.
("D&P"), or Fitch Investor Services Inc. D&P is not affiliated with the Fund or
DPM) or in unrated securities determined by the Adviser to be comparable with
such rating categories. If, in the Adviser's opinion, market conditions warrant,
the Series may increase its position in lower or non-rated securities from time
to time. In an effort to protect its assets against major market declines, or
for other temporary defensive purposes, this Series may actively pursue a policy
of retaining cash or investing part or all of its assets in cash equivalents,
such as government securities and high grade commercial paper.

The price of fixed income securities will generally move in inverse proportion
to interest rates. Lower rated and non-rated fixed-income securities are
predominantly speculative with respect to the issuer's capacity to repay
principal and pay interest. Investment in lower rated and non-rated convertible
fixed-income securities normally involves a greater degree of market and credit
risk than does investment in securities having higher ratings. In addition,
non-rated securities are often less marketable than rated securities. To the
extent that the Series holds any lower rated or non-rated securities, it may be
negatively affected by adverse economic developments, increased volatility and
lack of liquidity.

Phoenix Duff & Phelps Bond Fund

The investment objective of the Bond Fund is to generate a high level of current
income and appreciation of capital, consistent with prudent investment risk,
through investment in a diversified portfolio of debt securities.

The Series will purchase corporate debt securities which are issued by United
States or Canadian corporations and government securities, domestic and foreign.
It is the Adviser's present intent to purchase principally those government
securities which are issued or guaranteed by the United States government and
its agencies or instrumentalities and by the Government of Canada or any
Canadian province, municipality or governmental agency thereof. Canadian and
other foreign securities will be purchased only if principal and interest with
respect to such securities is payable in United States dollars.

At least 80% of the value of the Series' total investment in corporate debt
securities (other than commercial paper) will be represented by debt securities
which have, at the time of purchase, a rating within the four highest grades as
determined by Moody's Investors Service, Inc. (Aaa, Aa, A or Baa) or Standard
Poor's Corporation (AAA, AA, A or BBB) and debt securities of banks and other
issuers which, although not rated as a matter of policy by either Moody's
Investors Service, Inc. or Standard & Poor's Corporation, are considered by the
Adviser to have investment quality comparable to securities

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receiving rating within such four highest grades. If, in the Adviser's opinion,
market conditions warrant, the Series may increase its position in lower or
non-rated securities from time to time. The Series will seek to purchase debt
securities which have protection against immediate refunding. The Series may
include debt securities which sell at substantial discounts from par. These
securities are low coupon bonds which, during periods of high interest rates
because of their lower acquisition cost, tend to sell at a yield basis that
approaches current interest rates.

Assets of the Series may also be invested in short-term investments such as U.S.
Treasury notes and bills, obligations issued or guaranteed as to principal or
interest by the United States government or any agency or authority thereof,
obligations of U.S. banks and savings and loan associations (including foreign
branches of U.S. banks and U.S. branches of foreign banks) such as certificates
of deposit, time deposits and bankers acceptances, commercial paper, repurchase
agreements with respect to any of the foregoing obligations and, when in the
opinion of the Adviser, current cash needs or market or economic conditions
warrant, the Series may temporarily maintain a portion of its assets in cash.

Phoenix Duff & Phelps Enhanced Reserves Fund

The investment objective of the Enhanced Reserves Fund is to seek a high level
of current income consistent with preservation of capital. The Series seeks to
achieve its objective primarily by investing in a diversified portfolio of U.S.
government securities and high grade corporate debt obligations.

Under normal market conditions, the Series intends to invest at least 65% of the
total value of its assets in U.S. government obligations including asset-backed
securities issued by the U.S. government or its agencies or instrumentalities
and corporate debt obligations. The balance of the Series's assets may be
invested in municipal obligations, mortgage-related securities of private
issuers, bank obligations, certain money market instruments, repurchase
agreements, and (with respect to up to 20% of the Series' total assets) in
dollar-denominated obligations of foreign issuers.

The Series may purchase portfolio securities with maturities of greater than one
year. In normal market conditions, however, the duration of the Series's
aggregate portfolio will be approximately one year. All debt obligations with
maturities greater than one year acquired by the Series will be rated at the
time of purchase AAA, AA, or A by Standard & Poor's Corporation or Aaa, Aa, or A
by Moody's Investors Service, Inc. or rated AAA, AA, or similarly rated by any
nationally recognized statistical rating organization. Short-term debt
obligations acquired by the Series will have equivalent ratings. The value of
the Series' portfolio can be expected to fall when interest rates rise and
vice-versa, according to changes in prevailing interest rates.

At times the Adviser may judge that market conditions make pursuing the Series's
basic investment strategy inconsistent with the best interests of its
shareholders. At such times, the Adviser may use alternative strategies
primarily designed to reduce fluctuations in the value of the Series's assets.
In implementing these "temporary defensive" strategies, the Series may, without
limitation, invest in high-quality, short-term securities.

Phoenix Duff & Phelps Growth Stock Fund

The investment objective of the Growth Stock Fund is to seek long-term
appreciation of capital. Since income is not an objective, any income generated
by the investment of the Series' assets will be incidental to its objective.

The Series may invest any amount or proportion of its assets in any class or
type of stock believed by the Adviser to offer potential for capital
appreciation over both the intermediate and long-term. The Series may also
invest in preferred stocks,

<PAGE>

bonds, convertible preferred stocks and convertible debentures if, in the
Adviser's judgment, such investment will further its investment objective.

When, for temporary defensive purposes (as when market conditions for growth
stocks are adverse), it is determined that other types of investments appear
advantageous on the basis of combined considerations of risk and the protection
of capital values, investments may be made in fixed income securities with or
without warrants or conversion features. In an effort to protect its assets
against major market declines, or for other temporary defensive purposes, the
Series may actively pursue a policy whereby it will retain cash or invest part
or all of its assets in cash equivalents.

Investments in common stocks for capital appreciation are subject to the risks
of changing economic and market conditions which may affect the profitability
and financial conditions of the companies in whose securities the Series is
invested and the Adviser's ability to anticipate those changes. Since
investments normally will consist primarily of securities considered to have
potential for appreciation, the assets of the Series may be considered to be
subject to greater risks than would be involved if the Series invested in
securities which do not have such potential.

Phoenix Duff & Phelps Money Market Fund

The principal investment objective for the Money Market Fund is to achieve as
high a level of current income as is consistent with safety of principal and
maintenance of liquidity. Investments shall be primarily in high grade short
term securities such as commercial paper, notes payable upon demand or having
maturities varying from one day to 397 days, Treasury or agency obligations or
repurchase agreements, municipal notes, Banker's Acceptances, Certificates of
Deposit or any other form of short term security. The dollar-weighted average
maturity for any Series investment shall not exceed 90 days.

Generally, commercial paper held by the Series will be limited to securities
rated in the two highest "short term" rating categories by at least two
nationally recognized statistical rating organizations (one nationally
recognized statistically rating organization if that security only has one
rating) or, if unrated, be issued by companies with an outstanding debt issue
currently rated AAA by Standard & Poor's Corporation or Aaa by Moody's Investors
Service, Inc. No more than 5% of the Series assets will be invested in
securities not rated in the highest short-term rating category, and, of those
securities, no more than the greater of 1% of the Series' assets or $1 million
can be held by any one issuer. Certificates of Deposits must be issued by banks
which have capital, surplus and undivided profits of at least $100,000,000.

The Series may not necessarily invest in money market instruments paying the
highest available yield at a particular time as a result of considerations of
liquidity and preservation of capital. Rather, consistent with its investment
objective, the Series will attempt to maximize yields by engaging in portfolio
trading and buying and selling portfolio investments in anticipation of, or in
response to, changing economic and money market conditions and trends. These
policies, as well as the relatively short maturities of obligations to be
purchased by the Series, may result in frequent changes in its portfolio
holdings.

The value of the securities in the Series portfolio can be expected to vary
inversely to the changes in prevailing interest rates. Thus, if interest rates
increase after a security was purchased, that security, if sold, might be sold
at less than cost. Conversely, if interest rates decline after purchase, the
security, if sold, might be sold at a profit. In either instance, if the
security were held to maturity, no gain or loss would normally be realized as a
result of these fluctuations. Substantial redemptions of Series shares could
require the sale of portfolio investments at a time when a sale might not be
desirable.

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Phoenix Duff & Phelps U.S. Government Securities Fund

The investment objective of the U.S. Government Securities Fund is to seek a
high level of current income consistent with safety of principal by investing at
least 80% of Series assets in a diversified portfolio of securities consisting
of: (1) securities issued and guaranteed by the U.S. Government, (2) securities
issued by U.S. Government agencies and instrumentalities and backed by the full
faith and credit of the United States, and (3) securities issued by U.S.
Government agencies and instrumentalities which are guaranteed by such agencies
and instrumentalities but are not otherwise backed by the full faith and credit
of the United States. The Series is also authorized to invest up to 20% of its
value in short-term instruments.

U.S. Government Securities include (i) U.S. Treasury obligations which differ
only in their interest rates, maturities and times of issuance as follows: U.S.
Treasury Bills (maturity of one year or less), bonds (generally maturities of
greater than ten years), notes (maturity of one to ten years); (ii) obligations
issued or guaranteed by U.S. Government agencies and instrumentalities that are
backed by the full faith and credit of the United States; such as securities
issued by the Federal Housing Administration, the Government National Mortgage
Association ("GNMA"), the Department of Housing and Urban Development, the
Export-Import Bank, the General Services Administration and the Maritime
Administration and certain securities issued by the Farmers Home Administration
and the Small Business Administration; (iii) obligations issued or guaranteed by
U.S. Government agencies or instrumentalities that are not backed by the full
faith and credit of the United States; such as securities issued by the Farm
Credit Financial Assistance Corporation, Financing Corporation, Federal Home
Loan Bank, Federal Home Loan Mortgage Corporation ("FHLMC"), Federal National
Mortgage Association ("FNMA"), Farm Credit Banks, Resolution Funding Corporation
and Student Loan Marketing Association.

The range of maturities of U.S. Government Securities expected to be held by the
Series will generally not exceed five years with targeted duration of three
years. As used in this Series, the term "duration" of a security refers to the
indicators used by the Adviser to analyze a portfolio's sensitivity to interest
changes.

Although the payment of interest and principal on a portfolio security may be
guaranteed in certain instances by the U.S. Government or one of its agencies or
instrumentalities, the value of units of the Series will fluctuate in response
to interest rate levels. In general, when interest rates rise, prices of fixed
income securities decline. When interest rates decline, prices of fixed income
securities rise.

INVESTMENT TECHNIQUES AND RELATED RISKS

In addition to the investment policies described above, each Series, unless
otherwise described, may utilize the following investment practices or
techniques:

"When issued" and "delayed delivery" Securities

Each Series may purchase and sell securities on a "when issued" and "delayed
delivery" basis. A Series accrues no income on such securities until the Series
actually takes delivery of such securities. These transactions are subject to
market fluctuation; the value of the securities at delivery may be more or less
than their purchase price. The yields generally available on comparable
securities when delivery occurs may be higher than yields on the securities
obtained pursuant to such transactions. Because each Series relies on the buyer
or seller to consummate the transaction, failure by the other party to complete
the transaction may result in a Series missing the opportunity of obtaining a
price or yield considered to be advantageous. Each Series will engage in "when
issued" and "delayed delivery" transactions for the purpose of acquiring
securities consistent with the Series' investment objective and policies and not
for the purpose of investment leverage.

"Zero-Coupon" and "Payment-in-Kind" Securities

Each Series may invest in so-called "zero-coupon" and "payment-in-kind"
securities. The Internal Revenue Code of 1986, as amended (the "Code"), requires
that regulated investment companies distribute at least 90% of their net
investment income each year, including tax-exempt and non-cash income.
Accordingly, although a Series will receive no coupon

<PAGE>

payments on zero coupon securities prior to their maturity and may receive
additional securities in lieu of cash payments on payment-in-kind securities, a
Series is required, in order to maintain the desired tax treatment, to include
in its distributions to shareholders in each year any income attributable to
such securities that is in excess of 10% of a Series' net investment income in
that year.

Securities Lending

Each Series may lend its securities to brokers, dealers and financial
institutions provided that the market value of the securities subject to any
such loans does not exceed 25% of the value of the total assets (taken at market
value) of such Series; and receive, as collateral, cash or cash equivalents
which at all times while the loan is outstanding, will be maintained in amounts
equal to at least 102% of the current market value of the loaned securities. Any
cash collateral will be invested in short-term securities. All fees or charges
earned from securities lending will inure to the benefit of the Series. A Series
will have the right to regain record ownership of loaned securities within six
business days and to exercise beneficial rights such as voting rights and
subscription rights. While a securities loan is outstanding, the Series will
receive amounts equal to any interest or other distributions with respect to the
loaned securities. Any agreement to lend securities shall provide that borrowers
are obligated to return the identical securities or their equivalent at
termination of the loan and, that the Series shall have the right to retain any
collateral or use the same to purchase equivalent securities should the borrower
fail to return securities as required.

Short-Term Instruments

Each Series (other than the Money Market Fund) may invest up to 20% of its
assets in short term instruments other than instruments involving U.S.
Government Securities. Short term investments will be in high grade short term
securities such as commercial paper, drafts, notes payable upon demand or having
maturities varying from one day to 397 days, municipal notes, Bankers'
Acceptances, Certificates of Deposit or any other form of short term security
but may also include cash should such a holding appear to be consistent with the
goal of maximizing earnings. It is intended that commercial paper held by these
Series will be rated A-1 by Standard & Poor's Corporation or P-1 by Moody's
Investors Service, Inc. or, if unrated, be issued by companies with an
outstanding debt issue currently rated at least AA by Standard & Poor's
Corporation or Aa by Moody's Investors Service, Inc. Certificates of Deposits
must be issued by banks which have capital, surplus and undivided profits of at
least $100,000,000.

Mortgage-Related Securities

Each Series (other than Growth Fund) may invest in securities that directly or
indirectly represent a participation in, or are secured by and payable from,
mortgage loans secured by real property ("Mortgage-Related Securities"). The
MortgageRelated Securities in which these Series may invest include those with
fixed, floating and variable interest rates and those with interest rates that
change based on multiples of changes in interest rates, as well as stripped
Mortgage-Related Securities which are derivative multi-class mortgage
securities. Although certain Mortgage-Related Securities are guaranteed by a
third party or otherwise similarly secured, the market value of the security,
which may fluctuate, is not so secured. If these Series purchase a
Mortgage-Related Security at a premium, all or part of the premium may be lost
if there is a decline in the market value of the security, whether resulting
from changes in interest rates or prepayments in the underlying mortgage
collateral. As with other interest-bearing securities, the prices of certain
Mortgage-Related Securities are inversely affected by changes in interest rates,
while other securities which these Series may purchase may be structured so that
their interest rates will fluctuate inversely (and thus their price will
increase as interest rates rise and decrease as interest rates fall) in response
to changes in interest rates. Though the value of a Mortgage-Related Security
may decline when interest rates rise, the converse is not necessarily true,
since in periods of declining interest rates the mortgages underlying the
security are more likely to prepay. For this and other reasons, a
Mortgage-Related Security's stated maturity may be shortened by unscheduled
prepayments on the underlying mortgages, and, therefore, it is not possible to
predict accurately the security's return. Moreover, with respect to stripped
Mortgaged-Related Securities, if the underlying mortgage securities experience
greater than anticipated prepayments of principal, these Series may fail to
fully recoup its initial investment in these securities even if the securities
are rated in the highest rating category by a nationally recognized statistical
rating organization. In addition,

<PAGE>

regular payments received in respect of Mortgage-Related Securities include both
interest and principal. No assurance can be given as to the return these Series
will receive when these amounts are reinvested.

Each Series (other than the Growth Fund) may also invest in securities issued by
corporate and other special purpose entities in which the source of income
payments on the securities is a dedicated pool of assets ("Asset-Backed
Securities"). The securitization techniques used for Asset-Backed Securities are
similar to those used for Mortgage-Related Securities. The collateral for these
securities has included home equity loans, automobile and credit card
receivables, boat loans, computer leases, airplane leases, mobile home loans,
recreational vehicle loans and hospital and other account receivables.

Financial Futures and Related Options

Each Series (other than the Money Market Fund) may enter into financial futures
contracts and related options. These instruments are referred to as
"derivatives" as their value is derived from the value of the underlying
security or securities index. These Series may purchase and sell financial
futures contracts which are traded on a recognized exchange or board of trade
and may purchase exchange - or board-traded put and call options on financial
futures contracts as a hedge against anticipated changes in the market value of
its portfolio securities or securities which it intends to purchase.

These Series will engage in transactions in financial futures contracts and
related options only for hedging purposes and not for speculation. In addition,
these Series will not purchase or sell any financial futures contract or related
option if, immediately thereafter, the sum of the cash or U.S. Treasury bills
initially committed with respect to these Series' existing futures and related
options positions and the premiums paid for related options would exceed 2% of
the market value of each Series' total assets. At the time of purchase of a
futures contract or a call option on a futures contract, an amount of cash, U.S.
Government securities or other appropriate high-grade debt obligations equal to
the market value of the futures contract minus these Series' initial margin
deposit with respect thereto will be deposited in a segregated account with
these Series to collateralize fully the position and thereby ensure that it is
not leveraged.

Engaging in transactions in financial futures contracts involves certain risks,
such as the possibility of an imperfect correlation between futures market
prices and cash market prices and the possibility that the Adviser could be
incorrect in its expectations as to the direction or extent of various interest
rate movements, in which case these Series' return might have been greater had
hedging not taken place. There is also the risk that a liquid secondary market
may not exist. The risk in purchasing an option on a financial futures contract
is that these Series will lose the premium it paid. There may also be
circumstances when the purchase of an option on a financial future contract
would result in a loss to these Series while the purchase or sale of the
contract would not have resulted in a loss.

Foreign Securities

Each Series (other than the Money Market and U.S. Government Securities Funds)
may purchase foreign securities, including those issued by foreign branches of
U.S. banks. Such investments in foreign securities will be less than 15% of the
total net asset value of these Series at the time of purchase. The Enhanced
Reserves and Bond Funds may invest in debt obligations issued by foreign
corporations and by foreign governments and their political subdivisions, which
securities will be denominated, and pay interest and principal, in U.S. dollars.

Investments in foreign securities, particularly those of non-governmental
issuers, involve considerations which are not ordinarily associated with
investing in domestic issues. These Series may invest in a broad range of
foreign securities including equity, debt and convertible securities and foreign
government securities. In connection with investments in foreign securities, the
Series may enter into forward foreign currency exchange contracts for the
purpose of protecting against losses resulting from fluctuations in exchange
rates between the U.S. dollar and a particular foreign currency denominating a
security which the Series holds or intends to acquire. These Series will not
speculate in forward foreign currency exchange contracts.

Investing in the securities of foreign companies involves special risks and
considerations not typically associated with investing in U.S. companies. These
include differences in accounting, auditing and financial reporting standards,
generally

<PAGE>

higher commission rates on foreign portfolio transactions, the possibility of
expropriation or confiscatory taxation, adverse changes in investment or
exchange control regulations, political instability which could affect U.S.
investments in foreign countries, difficulty in invoking legal process abroad
and potential restrictions on the flow of international capital. Additionally,
dividends payable on foreign securities may be subject to foreign taxes withheld
prior to distribution. Foreign securities often trade with less frequency and
volume than domestic securities and therefore may exhibit greater price
volatility. Changes in foreign exchange rates will affect the value of those
securities which are denominated or quoted in currencies other than the U.S.
dollar. Many of the foreign securities held by these Series will not be
registered with the Securities and Exchange Commission and many of the issuers
of foreign securities will not be subject to the Commission's reporting
requirements. Accordingly, there may be less publicly available information
about the securities and about the foreign company or government issuing them
than is available about a domestic company or government entity. Moreover,
individual foreign economies may compare favorably or unfavorably with the
United States economy with respect to such factors as rate of growth, rate of
inflation, capital reinvestment, resource self-sufficiency and balance of
payment positions, and economic trends in foreign countries may be difficult to
assess.

Particular risks are posed by investments in third world countries or so-called
"emerging markets." These securities may be especially volatile based on
relative economic, political and market conditions present in these countries.
These and other relevant conditions vary widely between emerging market
countries. For instance, certain emerging market countries are either
comparatively undeveloped or are in the process of becoming developed and may
consequently be economically based on a relatively few or closely interdependent
industries. A high proportion of the shares of many emerging market issuers may
also be held by a limited number of large investors trading significant blocks
of securities. While the Series will strive to be sensitive to publicized
reversals of economic conditions, political unrest and adverse changes in
trading status, unanticipated political and social developments may affect the
values of these Series' investments in such countries and the availability of
additional investments in such countries.

The Fund may use foreign custodians or sub-custodians in connection with
purchases of foreign securities and may maintain cash and cash equivalents in
the care of a foreign custodian. The amount of cash or cash equivalents
maintained in the care of eligible foreign custodians will be limited to an
amount reasonably necessary to effect foreign securities transactions. The use
of a foreign custodian invokes considerations which are not ordinarily
associated with domestic custodians. These considerations include the
possibility of expropriation, restricted access to books and records of the
foreign custodian, inability to recover assets that are lost while under the
control of the foreign custodian, and the impact of political, social or
diplomatic developments.

Repurchase Agreements

Each Series (other than Money Market and Growth Funds) may agree to purchase
portfolio securities subject to the seller's agreement to repurchase them at a
mutually agreed upon date and price. These Series will enter into such
repurchase agreements only with financial institutions that are deemed to be
creditworthy by the Adviser. During the term of any repurchase agreement, the
Adviser will continue to monitor the creditworthiness of the seller. Although
the securities subject to repurchase agreements may bear maturities exceeding
thirteen months, these Series do not presently intend to enter into repurchase
agreements with deemed maturities in excess of seven days. If in the future a
Series were to enter into repurchase agreements with deemed maturities in excess
of seven days, such Series would do so only if such investment, together with
other illiquid securities, did not exceed 15% of the value of that Series' total
assets. Default or bankruptcy of the seller would, however, expose the Series to
possible delay in connection with the disposition of the underlying securities
or loss to the extend that proceeds from a sale of the underlying securities
were less than the repurchase price under the agreement.

Securities and Index Options

The Balanced, Enhanced Reserves and U.S. Government Securities Funds may write
covered call options and purchase call and put options. The value of the total
assets of these Series which may be subject to call options is limited to 50% of
each Series' total assets. The Adviser presently intends to cease writing
options if and as long as 25% of such total assets are subject to outstanding
options contracts or if required under regulations of state securities
administrators. Call options on securities indices will be written only to hedge
in an economically appropriate way portfolio securities which are not

<PAGE>

otherwise hedged with options or financial futures contracts and will be
"covered" by identifying the specific portfolio securities being hedged.

These Series will write call options in order to obtain a return on its
investments from the premiums received and will retain the premiums whether or
not the options are exercised. Any decline in the market value of portfolio
securities will be offset to the extent of the premiums received (net of
transaction costs). If an option is exercised, the premium received on the
option will effectively increase the exercise price.

During the option period the writer of a call option has given up the
opportunity for capital appreciation above the exercise price should the market
price of the underlying security increase, but has retained the risk of loss
should the price of the underlying security decline. Writing call options also
involves risks relating to these Series' ability to close out options it has
written.

These Series may invest up to 2% of its total assets in exchange-traded call and
put options on securities and securities indices for the purpose of hedging
against changes in the market value of its portfolio securities. These Series
will invest in call and put options whenever, in the opinion of the Adviser, a
hedging transaction is consistent with the investment objectives of these
Series. These Series may sell a call option or a put option which it has
previously purchased prior to the purchase (in the case of a call) or the sale
(in the case of a put) of the underlying security. Any such sale would result in
a net gain or loss depending on whether the amount received on the sale is more
or less than the premium and other transaction costs paid on the call or put
which is sold. Purchasing a call or a put option involves the risk that these
Series may lose the premium it paid plus transaction costs.

Municipal Obligations

When conditions warrant, the Bond, Balanced and Enhanced Reserves Fund may
invest in obligations issued by or on behalf of state and local governmental
issuers ("Municipal Obligations"), whether or not the income thereon is exempt
from the Federal income tax. The purchase of Municipal Obligations may be
advantageous when, as a result of prevailing economic, regulatory or other
circumstances, the yield of such securities, on a pre-tax basis, is comparable
to that of corporate or U.S. Government obligations. Dividends paid by this
Series that are derived from interest on Municipal Obligations would be taxable
to the Series' shareholders for Federal income tax purposes.

INVESTMENT RESTRICTIONS

Each Series may not invest more than 25% of its assets in any one industry,
except the Money Market Fund may invest more than 25% of its assets in the
domestic banking industry; and the U.S. Government Securities Fund will invest
at least 80% of its net assets in securities backed or supported by the U.S.
Government. In addition to the investment restrictions described above, each
Series' investment program is subject to further restrictions which are
described in the Statement of Additional Information. The restrictions for each
Series described above are fundamental and may not be changed without
shareholder approval.

MANAGEMENT OF THE FUND

The Fund is a mutual fund, technically known as an open-end, diversified
investment company. The Board of Trustees supervises the business affairs and
investments of the Fund, which is managed on a daily basis by the Fund's
investment advisers. The Fund was organized as a Massachusetts business trust on
December 4, 1995. The Fund is currently authorized to offer shares of beneficial
interest in series and is currently offering shares of six Series. Two classes
of shares are currently offered by each Series.

<PAGE>

The Advisers

Phoenix Investment Counsel, Inc. ("PIC") is the investment adviser for each
Series other than the Enhanced Reserves Fund. PIC is located at 56 Prospect
Street, Hartford, Connecticut 06115-0480. PIC was originally organized in 1932
as John P. Chase, Inc. In addition to the Fund, PIC also serves as investment
adviser to other entities including Phoenix Multi-Portfolio Fund (all portfolios
other than the Real Estate Securities Portfolio), Phoenix Total Return Fund,
Inc., and The Phoenix Edge Series Fund (all Series other than the Real Estate
Securities Series) and as subadviser to the Chubb America Fund, Inc., SunAmerica
Series Trust, JNL Trust, and American Skandia Trust, among other investment
advisory clients. As of December 31, 1995, PIC had approximately $____ billion
in assets under management on a discretionary basis.

All of the outstanding stock of PIC is owned by Phoenix Equity Planning
Corporation ("Equity Planning"), a subsidiary of Phoenix Duff & Phelps
Corporation of Chicago, Illinois. Prior to November 1, 1995, PIC and Equity
Planning were indirect, wholly-owned subsidiaries of Phoenix Home Life Mutual
Insurance Company ("Phoenix Home Life") of Hartford, Connecticut. Phoenix Home
Life is a majority shareholder of Phoenix Duff & Phelps Corporation. Phoenix
Home Life is in the business of writing ordinary and group life and health
insurance and annuities. Its principal offices are located at One American Row,
Hartford, Connecticut 06115. Phoenix Duff & Phelps Corporation is a New York
Stock Exchange traded company that provides various financial advisory services
to institutional investors, corporations and individuals through operating
subsidiaries.

Duff & Phelps Investment Management Co. ("DPM") serves as the investment adviser
to the Enhanced Reserves Fund. DPM is a subsidiary of Phoenix Duff & Phelps
Corporation. DPM is located at 55 East Monroe Street, Suite 3800, Chicago,
Illinois 60603. As of December 31, 1995, DPM had approximately $___ billion in
assets under management on a discretionary basis. PIC and DPM are sometimes
collectively referred to as the "Advisers".

The Advisers continuously furnish an investment program for each applicable
Series and manage the investment and reinvestment of the assets subject at all
times to the supervision of the Trustees. Under the terms of the Investment
Advisory Agreements, each Adviser is entitled to a prescribed fee. For managing,
or directing the investments of the following Series, PIC is entitled a monthly
fee at the following annual rates based upon the average aggregate daily net
asset values of each such Series up to $1 billion: (a) 0.[ ]% of the average of
the aggregate daily net asset values of the Growth Fund; (b) 0.[ ]% of the
average of the aggregate daily net asset values of the Balanced Fund; (c) 0.[ ]%
of the average of the aggregate daily net asset values of the Bond Fund; (d) 0.[
]% of the average of the aggregate daily net asset values of the Money Market
Fund; and, (e) 0.[ ]% of the average of the aggregate daily net asset values of
the U.S. Government Securities Fund. DPM is entitled to a monthly fee for
managing, or directing the investments of the Enhanced Reserves Fund, at the
annual rate of 0. [ ]% of the average aggregate daily net asset values of such
Series up to $1 billion. Advisory fees payable to PIC or DPM, as applicable,
shall decrease by five basis points at such time as the average aggregate daily
net asset value of such Series exceeds $1 billion.

The Investment Advisory Agreements provide that each Adviser will reimburse the
Fund for the amount, if any, by which the total operating expenses of any
applicable Series (including each investment adviser's compensation, but
excluding interest, taxes, brokerage fees and commissions and extraordinary
expenses) for any fiscal year exceed the level of expenses which such Series is
permitted to bear under the most restrictive expense limitation (which has not
been waived) imposed on mutual funds by any state in which shares of the Series
are then qualified for sale. In addition, PIC has voluntarily agreed to assume
Total Fund Operating Expenses of each Series (other than the Enhanced Reserves
Fund), excluding interest, taxes, brokerage fees, commissions and extraordinary
expenses, until December 31, 2001, to the extent that such expenses exceed the
following percentages of average annual net asset values:

Operating Expense Limit
Class X Shares Class Y Shares
-------------- --------------
Growth Fund 0.70% 0.95%
Balanced Fund 0.65% 0.90%
Bond Fund 0.55% 0.80%
Money Market Fund 0.35% 0.60%
U.S. Government Securities Fund 0.40% 0.65%

<PAGE>

Duff & Phelps Investment Management Co. has voluntarily agreed to reimburse or
waive Total Fund Operating Expenses of the Enhanced Reserves Fund, excluding
interest, taxes, brokerage fees, commissions and extraordinary expenses, until
December 31, 1996, to the extent that such expenses exceed: 0.34% of the average
annual net asset values of Class X Shares of the Enhances Reserves Fund and .89%
of the average annual net asset values of Class Y Shares of the Enhances
Reserves Fund.

The Portfolio Managers

Balanced Fund

Mr. George I. Askew serves as portfolio manager of the Balanced Fund and as such
is responsible for the day-to-day management of the Series' portfolio. Mr. Askew
has served as a research analyst for Phoenix Home Life Mutual Insurance Company
since 1994, and an associate in the investment banking division of Merrill Lynch
& Co., from 1987 until 1992. Mr. Askew attended the University of California at
Los Angeles from 1992 until 1994, where he obtained his Masters in Business
Administration.

Bond Fund

Mr. James D. Wehr serves as portfolio manager of the Bond Fund and as such is
responsible for the day-to-day management of the Series' portfolio. Mr. Wehr has
served as portfolio manager of the Phoenix Home Life Separate Account P since
19[], Phoenix Tax-Exempt Bond Portfolio of the Phoenix Multi-Portfolio Fund;
Phoenix California Tax Exempt Bond Fund since 1993 and has been a Vice President
of PIC since 1991.

Enhanced Reserves Fund

Mr. Marvin E. Flewellen serves as co-portfolio manager of the Enhanced Reserves
Fund and as such is responsible for the day-to-day management of the Series'
portfolio. Mr. Flewellen has served as a Vice President and a Fixed Income
Portfolio Manager with DPM since 19[ ]. Mr. Flewellen was a Second Vice
President and portfolio manager with Northern Trust Bank from 19[ ] until 19[ ].

Mr. Robert J. Moore also serves as co-portfolio manager of the Enhanced Reserves
Fund and as such is responsible for the day-to-day management of the Series'
portfolio. Mr. Moore has served as Executive Vice President and head of Fixed
Income with DPM since 19[ ]. Mr. Moore was a principal and a portfolio manager
with Harris Investment Management from 19[ ] until 19[ ] and was a lead
portfolio manager at Ford Motor Company from 19[ ] until 19[ ].

Growth Fund

Mr. Thomas Melvin serves as portfolio manager of Growth Fund and as such is
responsible for the day-to-day management of the Series' portfolio. Mr. Melvin
has served as portfolio manager of Common Stock, Phoenix Home Life Mutual
Insurance Company from 1991 until 1995, and Portfolio Manager, Constitution
Capital Management from 1987 until 1991, and has been a Vice President of PIC
since 1994.

Money Market Fund

Ms. Dorothy J. Skaret serves as portfolio manager of the Money Market Fund and
as such is responsible for the day-to-day management of the Series' portfolio.
Ms. Skaret has served as the portfolio manager of Phoenix Home Life Separate
Account G from 19[ ] until 1995. Ms Skaret has also served as the portfolio
manager of the Money Market Fund of The Phoenix Edge Series Fund from 19[ ]
until the present, which also is advised by the Adviser. Ms. Skaret is also a
Vice President of National Securities & Research Corporation since 19[ ].

<PAGE>

U.S. Government Securities Fund

Mr. Christopher J. Kelleher serves as portfolio manager of the U.S. Government
Securities Fund and as such is responsible for the day-to-day management of the
Series' portfolio. Mr. Kelleher has served as the portfolio manager of Phoenix
Home Life Separate Account U since 19[ ]. Mr. Kelleher has been a Vice President
of PIC since 1991 and is also a Vice President of National Securities & Research
Corporation (since 19[ ]), and Vice President of The Phoenix Edge Series Fund
(since 19[ ]).

The Financial Agent

Equity Planning serves as financial agent of the Fund and, as such, performs
administrative, bookkeeping and pricing services and certain other
administrative functions for the Fund. As compensation, Equity Planning receives
a quarterly fee based on the average of the aggregate daily net asset values of
the Fund at an annual rate of $300 per $1 million which is expected to equal
approximately the cost to Equity Planning of providing such services.

The Custodians and Transfer Agent

The custodian of the assets of all Series other than the Enhanced Reserves
Series is The Chase Manhattan Bank, N.A., 1 Chase Manhattan Plaza, Floor 3B, New
York, New York 10081. The custodian for the assets of the Enhanced Reserves Fund
is State Street Bank and Trust Company, P.O. Box 1713, Boston, Massachusetts
02101. The Fund has authorized the custodians to appoint one or more
subcustodians for the assets of the Fund held outside the United States. The
securities and other assets of each Series of the Fund are held by the
custodians or any subcustodian separate from the securities and assets of each
other Series.

Equity Planning serves as transfer agent for the Fund (the "Transfer Agent") for
which it is paid $14.95 plus out-of-pocket expenses for each designated
shareholder account. The Transfer Agent is authorized to engage sub-agents to
perform certain shareholder servicing functions from time to time for which such
agents shall be paid a fee by the Transfer Agent.

Brokerage Commissions

Although the Rules of Fair Practice of the National Association of Securities
Dealers, Inc. prohibit its members from seeking orders for the execution of
investment company portfolio transactions on the basis of their sales of
investment company shares, under such Rules, sales of investment company shares
may be considered in selecting brokers to effect portfolio transactions.
Accordingly, some portfolio transactions are, subject to such Rules and to
obtaining best prices and executions, effected through dealers (excluding Equity
Planning) who sell shares of the Fund.

NATIONAL DISTRIBUTOR AND
DISTRIBUTION PLAN

Equity Planning serves as the national distributor of the Fund's shares. Equity
Planning is registered as a broker-dealer in fifty states. The principal offices
of Equity Planning are located at 100 Bright Meadow Boulevard, P.O. Box 2200,
Enfield, Connecticut 06083-2200. Philip R. McLoughlin is a Trustee and President
of the Fund and a director and officer of Equity Planning. G. Jeffrey Bohne,
James M. Dolan, William R. Moyer, Leonard J. Saltiel, and Nancy G. Curtiss are
officers of the Fund and officers of Equity Planning.

Equity Planning and the Fund have entered into distribution agreements under
which Equity Planning has agreed to use its best efforts to find purchasers for
Fund shares. The Fund has granted Equity Planning the exclusive right to
purchase from the Fund and resell, as principal, shares needed to fill
unconditional orders for Fund shares. Equity Planning may sell Fund shares
through its registered representatives or through securities dealers with whom
it has sales agreements. Equity Planning may also sell Fund shares pursuant to
sales agreements entered into with banks or bank affiliated securities brokers
who, acting as agent for their customers, place orders for Fund shares with
Equity Planning. Although the Glass-Steagall Act prohibits banks and bank
affiliates from engaging in the business of underwriting, distributing or
selling securities (including

<PAGE>

mutual fund shares), banking regulators have not indicated that such
institutions are prohibited from purchasing mutual fund shares upon the order
and for the account of their customers. If, because of changes in law or
regulations, or because of new interpretations of existing law, it is determined
that agency transactions of banks or bank affiliated securities brokers are not
permitted under the Glass-Steagall Act, the Trustees will consider what action,
if any, is appropriate. It is not anticipated that termination of sales
agreements with banks or bank affiliated securities brokers would result in a
loss to their customers or a change in the net asset value per share of a Series
of the Fund. The sale of Fund shares through a bank or a securities broker
affiliated with a bank is not expected to preclude the Fund from borrowing from
such bank or from availing itself of custodial or transfer agency services
offered by such bank.

Distribution Plan

The Trustees have adopted a distribution plan on behalf of the Class Y Shares
pursuant to Rule 12b-1 under the 1940 Act. The Class Y Share distribution plan
(the "Plan") has been approved by PIC or DPM, as applicable, as initial, sole
shareholder. The Plan authorizes the payment to Equity Planning of amounts not
exceeding 0.25% annually of the average of the daily net assets of each
respective Series for each year elapsed after the inception of the Plan.
Although under no contractual obligation to do so, the Fund intends to make such
payments to Equity Planning (i) as commissions for Class Y Shares of a Series
sold, all or part of which commissions will be paid by Equity Planning upon
receipt from the Fund to others (who may be other dealers or registered
representatives of Equity Planning), (ii) to enable Equity Planning to pay
maintenance or other fees with respect to Class Y Shares sold by other brokers
and remaining outstanding on the Fund's books during the period for which such
fee is paid (the "Service Fee"), and (iii) to enable Equity Planning to pay bank
affiliated securities brokers maintenance or other fees relating to Class Y
Shares purchased by their customers and remaining on the Fund's books during the
period for which such fee is paid. The portion of the above fees paid by the
Fund to Equity Planning as "Service Fees" shall not exceed 0.25% annually of
Class Y Share average daily net assets. Payments, less the portion thereof paid
by Equity Planning to others, may be used by Equity Planning for its expenses of
distributing Class Y Shares. The Fund is not required to reimburse Equity
Planning if expenses of distributing Class Y Shares exceed payments and any
sales charges retained by Equity Planning. Conversely, payments and sales
charges retained by Equity Planning in excess of expenses incurred in
distributing Class Y Shares shall be retained by Equity Planning as profit. The
Plan requires that at least quarterly the Trustees must review a written report
with respect to the amounts expended under the Plan and the purposes for which
such expenditures were made. While the Plan is in effect, the Fund will be
required to commit the selection and nomination of candidates for Trustees who
are not "interested persons"(as defined in the 1940 Act) to the discretion of
other Trustees who are not interested persons.

DESCRIPTION OF SHARES

The capitalization of the Fund consists solely of an unlimited number of shares
of beneficial interest. The Fund currently offers shares in six different
Series, each offering two classes. Holders of shares of a Series have equal
rights with regard to voting, redemptions, dividends, distributions, and
liquidations with respect to that Series (provided that Class Y Shares of a
Series bear higher distribution fees and pay correspondingly lower dividends per
share than Class X Shares of the same Series). Shareholders of all Series vote
on the election of Trustees. On matters affecting an individual Series (such as
approval of an investment advisory agreement or a change in fundamental
investment policies), a separate vote of that Series is required. On matters
affecting an individual class (such as approval of matters relating to the Class
Y distribution plan), a separate vote of that class is required. Shares of each
Series are fully paid, nonassessable, redeemable and fully transferable when
they are issued. Shares do not have cumulative voting rights, conversion,
preemptive rights or subscription rights.

The assets received by the Fund for the issue or sale of shares of each Series
and all income, earnings, profits and proceeds thereof, are allocated to such
Series (and class if applicable) subject only to the rights of creditors, and
constitute the underlying assets of such Series (and class if applicable). The
underlying assets of each Series are required to be segregated on the books of
account, and are to be charged with the expenses in respect to such Series and
with a share of the general expenses of the Fund. Any general expenses of the
Fund not readily identifiable as belonging to a particular Series or class will
be allocated by or under the direction of the Trustees as they determine fair
and equitable.

<PAGE>

Unlike the stockholders of a corporation, there is a possibility that the
shareholders of a Massachusetts business trust such as the Fund may be
personally liable for debts or claims against the Fund. The Declaration of Trust
provides that shareholders shall not be subject to any personal liability for
the acts or obligations of the Fund and that every written agreement,
undertaking or obligation made or issued by the Fund shall contain a provision
to that effect. The Declaration of Trust provides for indemnification out of the
Trust property for all losses and expenses of any shareholder held personally
liable for the obligations of the Fund. Thus, the risk of a shareholder
incurring financial loss on account of shareholder liability, which is
considered remote, is limited to circumstances in which the Fund itself would be
unable to meet its obligations.

Prior to March 1, 1996, the Bond, Balanced, Growth, Money Market and U.S.
Government Securities Funds existed as the Managed Bond Account ("Separate
Account P"), Balanced Account ("Separate Account L"), Growth Stock Account
("Separate Account S"), Money Market Account ("Separate Account G"), and U.S.
Government Account ("Separate Account U"), respectively; separate investment
accounts of Phoenix Home Life, pursuant to the insurance laws of the State of
New York and the laws of other States. Each separate account was maintained for
the purpose of investing amounts allocated thereto by Phoenix Home Life under
certain group annuity contracts issued by Phoenix Home Life in connection with
pension or profit-sharing plans which meet the requirements of Section 401(a) of
the Internal Revenue Code of 1986, as amended. The separate accounts were not
investment companies, pursuant to the 1940 Act. Accordingly, a risk factor
associated with an investment in the Fund is that the Fund has no operating
history as a mutual fund prior to March 1, 1996.

On October 16, 1995, the Board of Directors of Phoenix Home Life approved the
conversion of each such separate account into a corresponding series of the
Fund. As of March 1, 1996, the assets of each separate account were transferred
into the corresponding series of the Fund in exchange for shares of that Series
which were credited to each contractholder in accordance with the value of that
contractholder's separate account units as of the close of business on such
date. Each separate account was then terminated.

HOW TO BUY SHARES

The Fund currently issues two classes of shares for each Series. Class X Shares
are available to Plans and Institutions (as hereafter defined) which initially
purchase shares of the Fund whose net asset value exceeds $5 million. Class Y
Shares are offered to Plans and Institutions which initially purchase shares of
the Fund whose net asset value exceeds $1 million. "Plans" are defined as
corporate and governmental pension plans. "Institutions" are defined as
non-profit investors such as endowment funds and other tax-exempt organizations.
Completed applications for the purchase of shares should be mailed to State
Street Bank and Trust Company, P.O. Box 8301, Boston, MA 02266-8301.

The minimum subsequent investment for each Class is $1,000. Shares are sold at
the net asset value per share (as described below) next computed after a
completed application or purchase order is received by State Street Bank and
Trust Company together with good and sufficient funds therefor (certified
checks, federal funds wires, and automated clearing house transactions ("ACH")).
Completed orders received on a business day prior to 4:00 p.m. E.S.T. will be
processed based on that day's closing net asset value. Sales of shares may be
made through broker-dealers, pension consultants or other qualified financial
agents/institutions and will be processed at the next asset value per share next
computed after the order is received by State Street Bank and Trust Company.

The Fund reserves the right to waive the minimum initial investment amount for
the purchase of Fund shares with respect to: (i) Plans and Institutions who have
been invested in certain separate investment accounts of Phoenix Home Life
Mutual Insurance Company as of March 1, 1996; (ii) purchases by trust companies
and bank trust departments for funds over which such trust company or bank
exercises exclusive discretionary investment authority and charges an account
management fee and which are held in a fiduciary, agency, advisory, custodial or
similar capacity; accounts opened for Plans or Institutions for whom such trust
company or bank charges such shareholders an account management fee; or (iii)
accounts opened for shareholders where the amounts invested represent the
redemption proceeds from the reorganization or merger of other investment
companies.

<PAGE>

No sales commission or trail fees are payable to dealers in connection with the
purchase, sale or retention of Class X Shares. In connection with Class Y Share
purchases, Equity Planning may pay broker-dealers, from its own profits and
resources, a percentage of the net asset value of any such shares sold as set
forth below:

Purchase Amount Payment to Broker-Dealer
- --------------- ------------------------
$0 to $5,000,000 0.50%
$5,000,001 to $10,000,000 0.25%
$10,000,001 or more 0.10%

If part of any investment in Class Y Shares is subsequently redeemed within one
year of the investment date, the broker/dealer will refund to Equity Planning
any such amounts paid with respect to the investment. Equity Planning will
sponsor sales contests, training and educational meetings and provide to all
qualifying financial agents, from its own profits and resources, additional
compensation in the form of trips, merchandise or expense reimbursement. Brokers
or dealers other than Equity Planning may also levy customary additional charges
to shareholders for their services in effecting purchases, if they notify the
Fund of their intention to do so.

Equity Planning intends to pay investment dealers a service fee of 0.25% of the
sales price of Class Y Shares sold by such dealers, subject to future amendment
or termination. Equity Planning will retain all or a portion of the continuing
distribution fee assessed to Class Y shareholders to finance commissions and
related marketing expenses.

Shareholders may exchange Class X or Class Y Shares held in book-entry form for
shares of the same class of other Series of the Fund provided the following
conditions are met: (1) the shares that will be acquired in the exchange (the
"Acquired Shares") are available for sale in the shareholder's principal place
of business; (2) the Acquired Shares are the same class as the shares to be
surrendered (the "Exchanged Shares"); (3) the Acquired Shares will be registered
to the same shareholder account as the Exchanged Shares; (4) the account value
of the shares to be acquired must equal or exceed the minimum initial or
subsequent investment amount, as applicable, after the exchange is implemented;
and (5) the shareholder is qualified to acquire Fund shares in accordance with
the limitations described in this Prospectus. The Fund reserves the right to
refuse exchange purchases by any person or broker/dealer if, in the Fund's or
Adviser's opinion, (a) the exchange would adversely affect the Fund's ability to
invest according to its investment objectives and policies; (b) the Fund
believes that a pattern of exchanges coincides with a "market timing" strategy;
or (c) otherwise adversely affect the Fund and its shareholders. The Fund
reserves the right to terminate or modify its exchange privileges at any time
upon giving written notice to shareholders at least 60 days in advance.
Shareholders are urged to review their constituent documents and relevant
requirements in order to verify pertinent limitations imposed by retirement plan
or group annuity contract exchange limits as well as restrictions imposed by
governing law.

NET ASSET VALUE

The net asset value of the shares of each Series of the Fund is determined once
daily as of the close of trading of the New York Stock Exchange (the
"Exchange"), on days when the Exchange is open for trading. Net asset value per
share of a Series is determined by adding the values of all securities and other
assets of the Series, subtracting liabilities and expenses, and dividing by the
total number of outstanding shares of the Series. Assets and liabilities are
determined in accordance with generally accepted accounting principles and
applicable rules and regulations of the Securities and Exchange Commission. The
total liability allocated to a class, plus that class's distribution fee and any
other expenses allocated solely to that class, are deducted from the
proportionate interest of such class in the assets of the Series, and the
resulting amount of each is divided by the number of shares of that class
outstanding to produce the net asset value per share.

In determining the value of the assets of each Series (other than the Money
Market Fund), the securities for which market quotations are readily available
are valued at market value. The assets of the Money Market Fund are valued on an
amortized cost basis absent extraordinary or unusual market conditions. Debt
securities (other than short-term obligations) including those for which market
quotations are not readily available are normally valued on the basis of
valuations provided by a pricing service when such prices are believed to
reflect the fair value of such securities. Securities listed or traded on a
national securities exchange are valued at the last sale price or, if there has
been no recent sale, at the last bid price. Securities which are primarily
traded on foreign securities exchanges are generally valued at the preceding
closing values

<PAGE>

of such securities on their respective exchanges. A security that is listed or
traded on more than one exchange is valued at the quotation on the exchange
determined to be the primary market for such security by the Trustees or their
delegates. Securities traded in the over-the-counter market are valued at the
last bid price. Short-term obligations maturing in less than sixty days are
valued at amortized cost, which the Trustees have determined approximates
market. Equity options are valued at the last sale price unless the bid or asked
price is used. Exchange-traded fixed income options are valued at the last sale
price unless there is no sale price, in which event current prices by market
makers are used. Over-the-counter traded fixed income options are valued based
upon current prices provided by market makers. Financial futures are valued at
the settlement price established each day by the board of trade or exchange on
which they are traded. Illiquid securities are valued at the price determined in
good faith by the Trustees or the Adviser acting at their direction, considering
all relevant factors including but not limited to, prices disseminated by
pricing services (when such prices are believed to reflect the fair value of
such securities) and the value of any comparable securities for which market
quotations are readily available. If an event were to occur after the value of
an investment was so established but before the net asset value per share was
determined, which was likely to materially change the net asset value, then the
instrument would be valued using fair value considerations by the Trustees or
their delegates. If at any time a Series has other investments, such investments
shall be valued at the fair value thereof as determined in good faith by the
Trustees, although the actual calculations may be made by persons acting
pursuant to the direction of the Trustees.

HOW TO REDEEM SHARES

Any holder of shares of any Series may require the Fund to redeem its shares at
any time at the net asset value per share next computed after receipt of a
redemption request in proper written form by State Street Bank and Trust
Company, P.O. Box 8301, Boston, MA 02266-8301, ATTN: Phoenix Duff & Phelps
Institutional Mutual Funds. To be in proper form to redeem shares, (1) the
signature(s) of duly authorized representative(s) of the shareholder must appear
in the appropriate place upon the stock power; (2) the stock power or any
related instruction transmittal must specify the name and account number of the
shareholder exactly as registered; and (3) and all such signatures must be
guaranteed by an eligible guarantor institution as determined in accordance with
the standards and procedures established by the Transfer Agent. Currently, such
procedures generally permit guarantees by banks, broker-dealers, credit unions,
national securities exchanges, registered securities associations, clearing
agencies and savings associations. Signature(s) must also be guaranteed on any
change of address request submitted in conjunction with any redemption request.
Additional documentation may be required for redemptions by corporations,
partnerships or other organizations, or if redemption is requested by anyone
other than the shareholder(s) of record. Redemption requests will not be honored
until all required documents in proper form have been received.

In addition, each Series maintains a continuous offer to repurchase its shares,
and shareholders may normally sell their shares through securities dealers, who
may charge customary commissions for their services. The redemption price in
such case will be the price as of the close of the general trading session of
the New York Stock Exchange on that day, provided the order is received by the
dealer prior thereto, and is transmitted to the Distributor prior to the close
of its business. No charge is made by the Fund on redemptions, but shares
tendered through investment dealers may be subject to service charge by such
dealers. Payment for shares redeemed will be made within three days after
receipt of the duly endorsed share certificates or written request; provided,
however, that redemption proceeds will not be disbursed until each check used
for purchase of shares has been cleared for payment by the investor's bank which
may take up to 15 days after receipt of the check.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Each Series will be treated as a separate mutual fund for federal income tax
purposes. Each Series intends to elect to be taxed as a regulated investment
company ("RIC") and qualify as such annually under Subchapter M of the Internal
Revenue Code (the "Code"). As a RIC, each Series will not be subject to federal
income tax on its ordinary income and net realized gains distributed to its
shareholders. Each Series intends to distribute sufficient ordinary income and
net realized capital gains, if any, annually to avoid the imposition of federal
income tax or a non-deductible 4% excise tax.

Many investors, including most tax qualified plan investors, may be eligible for
preferential federal income tax treatment on distributions received from the
Series and dispositions of shares of the Series. This Prospectus does not
attempt to describe in any respect such preferential tax treatment. Any
prospective investor that is a trust or other entity eligible for

<PAGE>

special tax treatment under the Code that is considering purchasing shares of
the Series should consult its tax advisor about the federal, state or local tax
consequences particular to it, as should persons considering whether to have
amounts held for their benefit in such trusts or other entities which intend to
invest in shares of the Series.

Investors that do not receive preferential tax treatment are subject to federal
income tax on distributions received with respect to their shares of the Series.
Distributions of the Series' ordinary income and short-term capital gains are
taxable to shareholders as ordinary income whether received in cash or shares of
the Series. Designated long-term capital gains distributions are taxable as
long-term capital gains whether distribution in cash or additional shares and
regardless of how long the shareholder owned the shares of the Series; however,
a loss recognized on the sale of the shares of a Series held for six months or
less will be treated as a long-term capital loss to the extent of long-term
capital gains distributions received on those shares. Certain designated
dividends paid by the Series may be eligible for the dividends-received
deduction for corporate shareholders. Shareholders should consult with their tax
advisor for additional information concerning the federal, state, local and
foreign tax consequences of purchasing shares of the Series.

Dividends from net investment income, if any, of the Money Market Fund and
Enhances Reserves Fund will be declared daily and paid monthly. Dividends from
net investment income for all other Series will be accrued and paid
semi-annually. Dividends from net realized capital gains, if any, will be
declared and paid annually for all Series. Dividends and distributions with
respect to the shares of any class of any Series will be payable in full and
fractional shares of such class of Series at the net asset value on the first
business day after the record date, or, at the option of the shareholder, in
cash. Any shareholder who purchases shares of a Series prior to the close of
business on the record date for a dividend or distribution will be entitled to
receive such dividend or distribution.

The foregoing is only a summary of some of the important tax considerations
generally affecting the Series and their shareholders. Shareholders should
consult competent tax advisers regarding specific tax situations.

ADDITIONAL INFORMATION

Inquiries and requests for the Statement of Additional Information, the Annual
Report to Shareholders and the Semi-Annual Report to Shareholders should be
directed to Equity Planning at (800) 814-1897 or 100 Bright Meadow Boulevard,
P.O. Box 2200, Enfield, Connecticut 06083-2200.

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
56 Prospect Street
Hartford, Connecticut 06115

INVESTMENT ADVISERS
PHOENIX INVESTMENT COUNSEL, INC.
56 Prospect Street
Hartford, Connecticut 06115

DUFF & PHELPS INVESTMENT MANAGEMENT CO.
55 East Monroe Street, Suite 3800
Chicago, Illinois 60603

DISTRIBUTOR, FINANCIAL AGENT AND TRANSFER AGENT
PHOENIX EQUITY PLANNING CORPORATION
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
(800) 814-1897

<PAGE>

CUSTODIANS

State Street Bank and Trust Company
1 Heritage Drive, P2N
North Quincy, MA 02171

The Chase Manhattan Bank, N.A.
1 Chase Manhattan Plaza, Floor 3B
New York, NY 10081

<PAGE>

APPENDIX

A-1 and P-1 Commercial Paper Ratings

The Money Market Fund will only invest in commercial paper which at the date of
investment is rated A-1 by Standard & Poor's Corporation or P-1 by Moody's
Investors Service, Inc., or, if not rated, is issued or guaranteed by companies
which at the date of investment have an outstanding debt issue rated AA or
higher by Standard & Poor's or Aa or higher by Moody's.

Commercial paper rated A-1 by Standard & Poor's Corporation ("S&P") has the
following characteristics: Liquidity ratios are adequate to meet cash
requirements. Long-term senior debt is rated "A" or better. The issuer has
access to at least two additional channels of borrowing. Basic earnings and cash
flow have an upward trend with allowance made for unusual circumstances.
Typically, the issuer's industry is well established and the issuer has a strong
position within the industry. The reliability and quality of management are
unquestioned.

The rating P-1 is the highest commercial paper rating assigned by Moody's
Investors Service, Inc. ("Moody's"). Among the factors considered by Moody's in
assigning ratings are the following: (1) evaluation of the management of the
issuer; (2) economic evaluation of the issuer's industry or industries and an
appraisal of speculative-type risks which may be inherent in certain areas; (3)
evaluation of the issuer's products in relation to competition and customer
acceptance; (4) liquidity; (5) amount and quality of long-term debt; (6) trend
of earnings over a period of ten years; (7) financial strength of a parent
company and the relationship which exists with the issuer; and (8) recognition
by the management of obligations which may be present or may arise as a result
of public interest questions and preparations to meet such obligations.

Moody's Investors Service, Inc., Corporate Bond Ratings

Aaa--Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as
"gilt-edge." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.

Aa--Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they Comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa securities.

A--Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.

Baa--Bonds which are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

Ba--Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B--Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Caa--Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.

Ca--Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.

C--Bonds which are rated C are the lowest rated class of bonds and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

Standard and Poor's Corporation's Corporate Bond Ratings

AAA--This is the highest rating assigned by Standard & Poor's to a debt
obligation and indicates an extremely strong capacity to pay principal and
interest.

<PAGE>

AA--Bonds rated AA also qualify as high-quality debt obligations. Capacity to
pay principal and interest is very strong, and in the majority of instances they
differ from AAA issues only in small degree.

A--Bonds rated A have a strong capacity to pay principal and interest, although
they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions.

BBB--Bonds rated BBB are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay principal and interest for bonds in this category
than for bonds in the A category.

BB-B-CCC-CC--Bonds rated BB, B, CCC and CC are regarded, on balance, as
predominantly speculative with respect to the issuer's capacity to pay interest
and repay principal in accordance with the terms of the obligation. BB indicates
the lowest degree of speculation and CC the highest degree of speculation. While
such bonds will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.

D--Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. The D rating also will be used upon the
filing of a bankruptcy petition if debt service payments are jeopardized.

Fitch Investor Services, Inc.

AAA--Bonds considered to be investment grade and of the highest credit quality.
The obligor has an exceptionally strong ability to pay interest and repay
principal, which is unlikely to be affected by reasonably foreseeable events.

AA--Bonds considered to be investment grade and of very high credit quality. The
obligor's ability to pay interest and repay principal is very strong, although
not quite as strong as bonds rated "AAA". Because bonds rated in the "AAA" and
"AA" categories are not significantly vulnerable to foreseeable future
developments, short-term debt of these issuers is generally rated "F-1+."

A--Bonds considered to be investment grade and of high credit quality. The
obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.

BBB--Bonds considered to be investment grade and of satisfactory credit quality.
The obligor's ability to pay interest and repay principal is considered to be
adequate. Adverse changes in economic conditions and circumstances, however, are
more likely to have adverse impact on these bonds, and therefore impair timely
payment. The likelihood that the ratings of these bonds will fall below
investment grade is higher than for bonds with higher ratings.

BB--Bonds are considered speculative. The obligor's ability to pay interest and
repay principal may be affected over time by adverse economic changes. However,
business and financial alternatives can be identified which could assist the
obligor in satisfying its debt service requirements.

B--Bonds are considered highly speculative. While bonds in this class are
currently meeting debt service requirements, the probability of continued timely
payment of principal and interest reflects the obligor's limited margin of
safety and the need for reasonable business and economic activity throughout the
life of the issue.

CCC--Bonds have certain identifiable characteristics which, if not remedied, may
lead to default. The ability to meet obligations requires an advantageous
business and economic environment.

CC--Bonds are minimally protected. Default in payment of interest and/or
principal seems probable over time.

C--Bonds are in imminent default in payment of interest or principal.

DDD, DD, and D--Bonds are in default on interest and/or principal payments. Such
bonds are extremely speculative and should be valued on the basis of their
ultimate recovery value in liquidation or reorganization of the obligor. "DDD"
represents the highest potential for recovery on these bonds, and "D" represents
the lowest potential for recovery.

Plus (+) Minus (-)--Plus and minus signs are used with a rating symbol to
indicate the relative position of a credit within the rating category. Plus and
minus signs however, are not used in the "DDD", "DD", or "D" categories.

Duff & Phelps Credit Rating Co. Rating Scale--Duff & Phelps offers ratings for
short-term and long-term debt, preferred stock, structured financings, and
insurer's claims paying ability. D&P ratings are specific to credit quality,
i.e., the likelihood of timely payment for principal, interest, and in the case
of a preferred stock rating, preferred stock dividends. The insurance company
claims paying ability ratings reflect an insurer's ability to meet its claims
obligations.

<PAGE>

Long-Term Ratings
AAA Highest Quality
AA+, AA, AA- High Quality
A+, A, A- Good Quality
BBB+, BBB, BBB Satisfactory Quality
(investment grade)
BB+, B, B- Non-Investment Grade
B+, B, B- Non-Investment Grade
CCC Speculative

<PAGE>

PHOENIX DUFF & PHELPS INSTITUTIONAL MUTUAL FUNDS
56 Prospect Street
Hartford, Connecticut 06115
(800) 814-1897

STATEMENT OF ADDITIONAL INFORMATION

SUBJECT TO COMPLETION

DATE OF ISSUANCE: DECEMBER 6, 1995

<PAGE>

Phoenix Duff & Phelps Institutional Mutual Funds
56 Prospect Street
Hartford, Connecticut 06115
Statement of Additional Information
[February 1], 1996

This Statement of Additional Information is not a prospectus but is incorporated
by reference in the Prospectus. Much of the information contained in this
Statement of Additional Information expands upon subjects discussed in the
Prospectus. Accordingly, this Statement should be read in conjunction with the
Fund's current Prospectus, dated [February 1], 1996, a copy of which may be
obtained by calling Phoenix Equity Planning Corporation ("Equity Planning") at
(800) 814-1897, or by writing to Equity Planning at 100 Bright Meadow Boulevard,
P.O. Box 2200, Enfield, Connecticut 06083-2200.

TABLE OF CONTENTS*
Page
THE FUND (17) 2
INVESTMENT OBJECTIVES AND POLICIES (6) 2
INVESTMENT RESTRICTIONS (13) 12
PERFORMANCE INFORMATION (4) 13
PERFORMANCE COMPARISONS 15
PORTFOLIO TURNOVER 16
MANAGEMENT OF THE TRUST (13) 16
THE INVESTMENT ADVISERS (13) 21
BROKERAGE ALLOCATION 23
DETERMINATION OF NET ASSET VALUE (19) 23
PURCHASE OF SHARES (18) 24
TAXES (20) 25
THE NATIONAL DISTRIBUTOR (16) 26
FINANCIAL STATEMENTS 27

* Numbers in parenthesis are cross-references to related pages of the
Prospectus.

<PAGE>

THE FUND

Phoenix Duff & Phelps Institutional Mutual Funds (the "Fund") is an open-end
management investment company which was organized under Massachusetts law on
December 4, 1995 as a business trust. Prior to March 1, 1996, the Bond,
Balanced, Growth, Money Market and U.S. Government Securities Funds existed as
the Managed Bond Account ("Separate Account P"), Balanced Account ("Separate
Account L"), Growth Stock Account ("Separate Account S"), Money Market Account
("Separate Account G"), and U.S. Government Account ("Separate Account U"),
respectively; separate investment accounts of Phoenix Home Life Mutual Insurance
Company pursuant to the insurance laws of the State of New York and the laws of
other States. Accordingly, the Fund has no prior history as a mutual fund prior
to March 1, 1996.

INVESTMENT OBJECTIVES AND POLICIES

The investment objectives and policies of each Series are described in the
"Investment Objectives and Policies" and "Investment Techniques" sections of the
Prospectus. The following discussion supplements the description of the Series'
investment policies and investment techniques information contained in the
Prospectus.

The investment objective of each Series is deemed to be a fundamental policy and
may not be changed without the approval of the shareholders of that Series.
Investment restrictions described in this Statement of Additional Information
are fundamental policies of the Fund and may not be changed as to any Series
without the approval of the Series' shareholders.

MONEY MARKET INSTRUMENTS.

Certificates of Deposit. Certificates of deposit are generally short-term,
interest-bearing negotiable certificates issued by banks or savings and loan
associations against funds deposited in the issuing institution.

Time Deposits. Time deposits are deposits in a bank or other financial
institution for a specified period of time at a fixed interest rate for which a
negotiable certificate is not received.

Banker's Acceptances. A bankers' acceptance is a time draft drawn on a
commercial bank by a borrower usually in connection with an international
commercial transaction (to finance the import, export, transfer or storage of
goods). The borrower, as well as the bank, is liable for payment, and the bank
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
secondary markets prior to maturity.

Commercial Paper. Commercial paper refers to short-term, unsecured promissory
notes issued by corporations to finance short-term credit needs. Commercial
paper is usually sold on a discount basis and has a maturity at the time of
issuance not exceeding nine months.

Corporate Debt Securities. Corporate debt securities with a remaining maturity
of less than one year tend to become extremely liquid and are traded as money
market securities.

U.S. Government Obligations. Securities issued or guaranteed as to principal and
interest by the United States Government include a variety of Treasury
securities, which differ only in their interest rates, maturities, and times of
issuance. Treasury bills have maturities of one year or less. Treasury notes
have maturities of one to seven years, and Treasury bonds generally have
maturities of greater than five years. Agencies of the United States Government
which issue or guarantee obligations include, among others, Export-Import Banks
of the United States, Farmers Home Administration, Federal Housing
Administration, Government National Mortgage Association, Maritime
Administration, Small Business Administration and The Tennessee Valley
Authority. Obligations of instrumentalities of the United States Government
include securities issued or guaranteed by, among others, the Federal National
Mortgage Association, Federal Home Loan Banks, Federal Home Loan Mortgage
Corporation, Federal Intermediate Credit Banks, Banks for Cooperatives, and the
U.S. Postal Service. Some of these securities are supported by the full faith
and credit of the U.S. Government; others are

<PAGE>

supported by the right of the issuer to borrow from the Treasury, while still
others are supported only by the credit of the instrumentality. The U.S.
Government Securities Fund will invest primarily in securities which are
supported by the full faith and credit of the U.S. Government.

Repurchase Agreements. The repurchase price under the repurchase agreements
described in the Prospectus generally equals the price paid by the Fund plus
interest negotiated on the basis of current short-term rates (which may be more
or less than the rate on the securities underlying the repurchase agreement).
Securities subject to repurchase agreements are held by the Fund's custodian (or
sub-custodian) or in the Federal Reserve/Treasury book-entry system. Repurchase
agreements are considered to be loans under the Investment Company Act of 1940
(the "1940 Act").

Reverse Repurchase Agreements. At the time the Fund enters into a reverse
repurchase agreement (an agreement under which the Fund sells portfolio
securities and agrees to repurchase them at an agreed-upon date and price), it
will place in a segregated custodial account liquid assets such as U.S.
Government securities or other liquid high grade debt securities having a value
equal to or greater than the repurchase price (including accrued interest) and
will subsequently monitor the account to ensure that such value is maintained.
Reverse repurchase agreements involve the risk that the market value of the
securities sold by the Fund may decline below the price of the securities it is
obligated to repurchase. Reverse repurchase agreements are considered to be
borrowings under the 1940 Act. The Fund intends to limit its borrowings
(including reverse repurchase agreements) during the current fiscal year to not
more than 5% of its net assets.

Bank Obligations. For purposes of a Series' investment policies with respect to
bank obligations, the assets of a bank or savings institution will be deemed to
include the assets of its domestic and foreign branches.

Municipal Obligations. Municipal Obligations include debt obligations issued by
or on behalf of states, territories and possessions of the United States and the
District of Columbia and their political subdivisions, agencies and
instrumentalities to obtain funds for various public purposes, including the
construction of a wide range of public facilities, the refunding of outstanding
obligations, the payment of general operating expenses and the extension of
loans to public institutions and facilities.

The two principal classifications of Municipal Obligations consist of "general
obligation" and "revenue" issues. General obligation bonds are secured by the
issuer's pledge of its faith, credit and taxing power for the payment of
principal and interest, and, accordingly, the capacity of the issuer of a
general obligation bond as to the timely payment of interest and the repayment
of principal when due is affected by the issuer's maintenance of its tax base.
Revenue bonds are payable only from the revenues derived from a particular
facility or class of facilities or, in some cases, from the proceeds of a
special tax or other specific revenue source; accordingly, the timely payment of
interest and the repayment of principal in accordance with the terms of such
bonds is a function of the economic viability of such facility or revenue
source. The Bond, Balanced and Enhanced Reserves Fund portfolios may include
"moral obligation" issues, which are normally issued by special purpose
authorities. There are, of course, variations in the quality of Municipal
Obligations both within a particular classification and between classifications,
and the yields on Municipal Obligations depend upon a variety of factors,
including general money market conditions, the financial condition of the
issuer, general conditions of the municipal bond market, the size of a
particular offering, the maturity of the obligation and the rating of the issue.

Certain types of Municipal Obligations (private activity bonds) are or have been
issued to obtain funds to provide privately operated housing facilities,
pollution control facilities, convention or trade show facilities, mass transit,
airport, port or parking facilities and certain local facilities for water
supply, gas, electricity or sewage or solid waste disposal. Private activity
bonds are also issued by privately held or publicly owned corporations in the
financing of commercial or industrial facilities. State and local governments
are authorized in most states to issue private activity bonds for such purposes
in order to encourage corporations to locate within their communities. The
principal and interest on these obligations may be payable from the general
revenues of the users of such facilities.

From time to time, proposals have been introduced before Congress for the
purpose of restricting or eliminating the Federal income tax exemption for
interest on Municipal Obligations. For example, under the Federal tax
legislation enacted in 1986,

<PAGE>

interest on certain private activity bonds must be included in an investor's
alternative minimum taxable income, and corporate investors must treat all
tax-exempt interest as an item of tax preference.

As stated in the Prospectus, the Fund may, when deemed appropriate by the
Adviser in light of the particular Series' investment objective, invest in
Municipal Obligations. Dividends paid by the Series that are derived from
interest of Municipal Obligations would be taxable to the Series shareholders
for Federal income tax purposes.

Insured Municipal Obligations. Certain of the Municipal Obligations held by the
Fund may be insured as to the timely payment of principal and interest. The
insurance policies will usually be obtained by the issuer of the Municipal
Obligation at the time of its original issuance. In the event that the issuer
defaults on interest or principal payment, the insurer will be notified and will
be required to make payment to the bondholders. There is, however, no guarantee
that the insurer will meet its obligations. In addition, such insurance will not
protect against market fluctuations caused by changes in interest rates and
other factors.

Stand-By Commitments. The Fund may acquire stand-by commitments with respect to
Municipal Obligations. Under a stand-by commitment, a dealer or bank agrees to
purchase from the Fund, at the Fund's option, specified Municipal Obligations at
their amortized cost value to the Fund plus accrued interest, if any. Stand-by
commitments may be sold, transferred or assigned by the Fund only with the
underlying Municipal Obligation. The Fund expects that stand-by commitments will
generally be available without the payment of any direct or indirect
consideration. However, if necessary or advisable, the Fund may pay for a
stand-by commitment either separately in cash or by paying a higher price for
portfolio securities which are acquired subject to the commitment (thus reducing
the yield to maturity otherwise available for the same securities). Where the
Fund paid any consideration directly or indirectly for a stand-by commitment,
its cost would be reflected as unrealized depreciation for the period during
which the commitment was held by the Fund.

The Fund intends to enter into stand-by commitments only with dealers, banks and
broker-dealers which, in the Adviser's opinion, present minimal credit risks.
The Fund's reliance upon the credit of these dealers, banks and broker-dealers
will be secured by the value of the underlying Municipal Obligations that are
subject to the commitment. In evaluating the creditworthiness of the issuer of a
stand-by commitment, the Adviser will review periodically the issuer's assets,
liabilities, contingent claims and other relevant financial information. The
Fund would acquire stand-by commitments solely to facilitate portfolio liquidity
and does not intend to exercise its rights thereunder for trading purposes.
Stand-by commitments acquired by the Fund would be valued at zero in determining
net asset value.

When-Issued and Delayed Delivery Transactions. When the Fund agrees to purchase
securities on a when-issued or delayed delivery basis, its custodian will set
aside cash, U.S. Government securities or other liquid high-grade debt
obligations equal to the amount of the purchase or the commitment in a separate
account. Normally, the custodian will set aside portfolio securities to meet
this requirement. The market value of the separate account will be monitored and
if such market value declines, the Fund will be required subsequently to place
additional assets in the separate account in order to ensure that the value of
the account remains equal to the amount of the Fund's commitments. Because the
Fund will set aside cash or liquid high-grade debt securities in the manner
described, the Fund's liquidity and ability to manage its portfolio might be
affected in the event its when-issued purchases or delayed delivery commitments
ever exceeded 25% of the value of its assets. In the case of a delayed delivery
of the sale of portfolio securities, the Fund's custodian will hold the
portfolio securities themselves in a segregated account while the commitment is
outstanding.

The Fund will make commitments to purchase securities on a when-issued basis or
delayed delivery basis only with the intention of completing the transaction and
actually purchasing or selling the securities. If deemed advisable as a matter
of investment strategy, however, the Fund may dispose of or renegotiate a
commitment after it is entered into, and may sell securities it has committed to
purchase before those securities are delivered to the Fund on the settlement
date. In these cases the Fund may realize a capital gain or loss. When the Fund
engages in when-issued and delayed delivery transactions, it relies on the other
party to consummate the trade. Failure of such party to do so may result in the
Fund's incurring a loss or missing an opportunity to obtain a price considered
to be advantageous.

<PAGE>

The value of the securities underlying a when-issued purchase or a delayed
delivery to purchase securities, and any subsequent fluctuations in their value,
is taken into account when determining a Fund's net asset value starting on the
day the Fund agrees to purchase the securities. The Fund does not earn interest
on the securities it has committed to purchase until they are paid for and
delivered on the settlement date. When the Fund makes a delayed delivery of the
sale of securities it owns, the proceeds to be received upon settlement are
included in the Fund's assets, and fluctuations in the value of the underlying
securities are not reflected in the Fund's net asset value as long as the
commitment remains in effect.

Securities Issued by Other Investment Companies. The Fund may invest in
securities issued by other investment companies within the limits prescribed by
the 1940 Act. The Fund currently intends to limit such investments so that, as
determined immediately after a purchase is made: (a) not more than 5% of the
value of its total assets will be invested in the securities of any one
investment company; (b) not more than 10% of the value of its total assets will
be invested in the aggregate in securities of investment companies as a group;
(c) not more than 3% of the outstanding voting stock of any one investment
company will be owned by the Fund; and (d) not more than 10% of the outstanding
voting stock of any one investment company will be owned in the aggregate by the
Fund and other investment companies advised by the Investment Adviser. As a
shareholder of another investment company, the Fund would bear, along with other
shareholders, its pro rata portion of the expenses of such other investment
company, including advisory fees. These expenses would be in addition to the
advisory and other expenses that the Fund bears directly in connection with its
own operations; and may represent a duplication of fees to shareholders of the
Fund.

SECURITIES AND INDEX OPTIONS. The Balanced, Enhanced Reserves and U.S.
Government Securities Funds may write covered call options and purchase call and
put options. Options and the related risks are summarized below.

Writing and Purchasing Options. Call options written by a Series normally will
have expiration dates between three and nine months from the date written.
During the option period a Series may be assigned an exercise notice by the
broker-dealer through which the call option was sold, requiring the Series to
deliver the underlying security (or cash in the case of securities index calls)
against payment of the exercise price. This obligation is terminated upon the
expiration of the option period or at such earlier time as the Series effects a
closing purchase transaction. A closing purchase transaction cannot be effected
with respect to an option once the Series has received an exercise notice.

The exercise price of a call option written by a Series may be below, equal to
or above the current market value of the underlying security or securities index
at the time the option is written.

A multiplier for an index option performs a function similar to the unit of
trading for an option on an individual security. It determines the total dollar
value per contract of each point between the exercise price of the option and
the current level of the underlying index. A multiplier of 100 means that a
one-point difference will yield $100. Options on different indices may have
different multipliers.

Securities indices for which options are currently traded include the Standard &
Poor's 100 and 500 Composite Stock Price Indices, Computer/Business Equipment
Index, Major Market Index, Amex Market Value Index, Computer Technology Index,
Oil and Gas Index, NYSE Options Index, Gaming/Hotel Index, Telephone Index,
Transportation Index, Technology Index, and Gold/Silver Index. A Series may
write call options and purchase call and put options on any other indices traded
on a recognized exchange.

Closing purchase transactions will ordinarily be effected to realize a profit on
an outstanding call option written by a Series, to prevent an underlying
security from being called, or to enable a Series to write another call option
with either a different exercise price or expiration date or both. A Series may
realize a net gain or loss from a closing purchase transaction, depending upon
whether the amount of the premium received on the call option is more or less
than the cost of effecting the closing purchase transaction. If a call option
written by a Series expires unexercised, a Series will realize a gain in the
amount of the premium on the option less the commission paid.

<PAGE>

The option activities of a Series may increase its portfolio turnover rate and
the amount of brokerage commissions paid. A Series will pay a commission each
time it purchases or sells a security in connection with the exercise of an
option. These commissions may be higher than those which would apply to
purchases and sales of securities directly.

Limitations on Options. A Series may write call options only if they are covered
and if they remain covered so long as a Series is obligated as a writer. If a
Series writes a call option on an individual security, a Series will own the
underlying security at all times during the option period. A Series will write
call options on indices only to hedge in an economically appropriate way
portfolio securities which are not otherwise hedged with options or financial
futures contracts. Call options on securities indices written by a Series will
be "covered" by identifying the specific portfolio securities being hedged.

To secure the obligation to deliver the underlying security, the writer of a
covered call option on an individual security is required to deposit the
underlying security or other assets in escrow with the broker in accordance with
clearing corporation and exchange rules. In the case of an index call option
written by a Series, a Series will be required to deposit qualified securities.
A "qualified security" is a security against which a Series has not written a
call option and which has not been hedged by a Series by the sale of a financial
futures contract. If at the close of business on any day the market value of the
qualified securities falls below 100% of the current index value times the
multiplier times the number of contracts, a Series will deposit an amount of
cash or liquid assets equal in value to the difference. In addition, when a
Series writes a call on an index which is "in-the-money" at the time the call is
written, a Series will segregate with its custodian bank cash or liquid assets
equal in value to the amount by which the call is "in-the-money" times the
multiplier times the number of contracts. Any amount segregated may be applied
to a Series' obligation to segregate additional amounts in the event that the
market value of the qualified securities falls below 100% of the current index
value times the multiplier times the number of contracts.

A Series may invest up to 2% of its total assets in exchange-traded call and put
options. A Series may sell a call option or a put option which it has previously
purchased prior to the purchase (in the case of a call) or the sale (in the case
of a put) of the underlying security. Any such sale of a call option or a put
option would result in a net gain or loss, depending on whether the amount
received on the sale is more or less than the premium and other transaction
costs paid. In connection with a Series qualifying as a regulated investment
company under the Internal Revenue Code, other restrictions on a Series' ability
to enter into option transactions may apply from time to time. See "Taxes."

Risks Relating to Options. During the option period, the writer of a call option
has, in return for the premium received on the option, given up the opportunity
for capital appreciation above the exercise price should the market price of the
underlying security increase, but has retained the risk of loss should the price
of the underlying security decline. The writer has no control over the time when
it may be required to fulfill its obligation as a writer of the option.

The risk of purchasing a call option or a put option is that a Series may lose
the premium it paid plus transaction costs. If a Series does not exercise the
option and is unable to close out the position prior to expiration of the
option, it will lose its entire investment.

An option position may be closed out only on an exchange which provides a
secondary market for an option of the same series. Although a Series will write
and purchase options only when the Adviser believes that a liquid secondary
market will exist for options of the same series, there can be no assurance that
a liquid secondary market will exist for a particular option at a particular
time and that a Series, if it so desires, can close out its position by
effecting a closing transaction. If the writer of a covered call option is
unable to effect a closing purchase transaction, it cannot sell the underlying
security until the option expires or the option is exercised. Accordingly, a
covered call writer may not be able to sell the underlying security at a time
when it might otherwise be advantageous to do so.

Possible reasons for the absence of a liquid secondary market on an exchange
include the following: (i) insufficient trading interest in certain options;
(ii) restrictions on transactions imposed by an exchange; (iii) trading halts,
suspensions or other restrictions imposed with respect to particular classes or
series of options or underlying securities; (iv) inadequacy of the facilities of
an exchange or the clearing corporation to handle trading volume; and (v) a
decision by one or more exchanges to discontinue the trading of options or
impose restrictions on orders.

<PAGE>

Each exchange has established limitations governing the maximum number of call
options, whether or not covered, which may be written by a single investor
acting alone or in concert with others (regardless of whether such options are
written on the same or different exchanges or are held or written on one or more
accounts or through one or more brokers). An exchange may order the liquidation
of positions found to be in violation of these limits and it may impose other
sanctions or restrictions. The Adviser believes that the position limits
established by the exchanges will not have any adverse impact upon a Series or
all of the Series, in the aggregate.

Risks of Options on Indices. Because the value of an index option depends upon
movements in the level of the index rather than movements in the price of a
particular security, whether a Series will realize a gain or loss on the
purchase or sale of an option on an index depends upon movements in the level of
prices in the market generally or in an industry or market segment rather than
upon movements in the price of an individual security. Accordingly, successful
use by a Series of options on indices will be subject to the Adviser's ability
to predict correctly movements in the direction of the market generally or in
the direction of a particular industry. This requires different skills and
techniques than predicting changes in the prices of individual securities.

Index prices may be distorted if trading of certain securities included in the
index is interrupted. Trading in index options also may be interrupted in
certain circumstances, such as if trading were halted in a substantial number of
securities included in the index. If this occurred, a Series would not be able
to close out options which it had written or purchased and, if restrictions on
exercise were imposed, might be unable to exercise an option it purchased, which
would result in substantial losses to a Series. However, it is the Fund's policy
to write or purchase options only on indices which include a sufficient number
of securities so that the likelihood of a trading halt in the index is
minimized.

Because the exercise of an index option is settled in cash, an index call writer
cannot determine the amount of its settlement obligation in advance and, unlike
call writing on portfolio securities, cannot provide in advance for its
potential settlement obligation by holding the underlying securities.
Consequently, a Series will write call options on indices only subject to the
limitations described above.

Price movements in securities in a Series' portfolio will not correlate
perfectly with movements in the level of the index and, therefore, a Series
bears the risk that the price of the securities held by the Series may not
increase as much as the level of the index. In this event, the Series would bear
a loss on the call which would not be completely offset by movements in the
prices of a Series' portfolio securities. It is also possible that the index may
rise when the value of a Series' portfolio securities does not. If this
occurred, the Series would experience a loss on the call which would not be
offset by an increase in the value of its portfolio and might also experience a
loss in the market value of portfolio securities.

Unless a Series has other liquid assets which are sufficient to satisfy the
exercise of a call on an index, a Series will be required to liquidate portfolio
securities in order to satisfy the exercise. Because an exercise must be settled
within hours after receiving the notice of exercise, if a Series fails to
anticipate an exercise, it may have to borrow from a bank (in an amount not
exceeding 10% of a Series' total assets) pending settlement of the sale of
securities in its portfolio and pay interest on such borrowing.

When a Series has written a call on an index, there is also a risk that the
market may decline between the time a Series has the call exercised against it,
at a price which is fixed as of the closing level of the index on the date of
exercise, and the time a Series is able to sell securities in its portfolio. As
with options on portfolio securities, a Series will not learn that a call has
been exercised until the day following the exercise date but, unlike a call on a
portfolio security where a Series would be able to deliver the underlying
security in settlement, a Series may have to sell part of its portfolio
securities in order to make settlement in cash, and the price of such securities
might decline before they could be sold.

If a Series exercises a put option on an index which it has purchased before
final determination of the closing index value for that day, it runs the risk
that the level of the underlying index may change before closing. If this change
causes the exercised option to fall "out-of-the-money" a Series will be required
to pay the difference between the closing index value and the exercise price of
the option (multiplied by the applicable multiplier) to the assigned writer.
Although a Series may

<PAGE>

be able to minimize this risk by withholding exercise instructions until just
before the daily cutoff time or by selling rather than exercising an option when
the index level is close to the exercise price, it may not be possible to
eliminate this risk entirely because the cutoff times for index options may be
earlier than those fixed for other types of options and may occur before
definitive closing index values are announced.

FINANCIAL FUTURES AND RELATED OPTIONS.

Each Series (other than the Money Market Fund) may use financial futures
contracts and related options to hedge against changes in the market value of
its portfolio securities or securities which it intends to purchase. Hedging is
accomplished when an investor takes a position in the futures market opposite to
his cash market position. There are two types of hedges--long (or buying) and
short (or selling) hedges. Historically, prices in the futures market have
tended to move in concert with cash market prices, and prices in the futures
market have maintained a fairly predictable relationship to prices in the cash
market. Thus, a decline in the market value of securities in a Series' portfolio
may be protected against to a considerable extent by gains realized on futures
contracts sales. Similarly, it is possible to protect against an increase in the
market price of securities which a Series may wish to purchase in the future by
purchasing futures contracts.

A Series may purchase or sell any financial futures contracts which are traded
on a recognized exchange or board of trade. Financial futures contracts consist
of interest rate futures contracts and securities index futures contracts. A
public market presently exists in interest rate futures contracts covering
long-term U.S. Treasury bonds, U.S. Treasury notes, three-month U.S. Treasury
bills and GNMA certificates. Securities index futures contracts are currently
traded with respect to the Standard & Poor's 500 Composite Stock Price Index and
such other broad-based stock market indices as the New York Stock Exchange
Composite Stock Index and the Value Line Composite Stock Price Index. A clearing
corporation associated with the exchange or board of trade on which a financial
futures contract trades assumes responsibility for the completion of
transactions and also guarantees that open futures contracts will be performed.

In contrast to the situation when a Series purchases or sells a security, no
security is delivered or received by a Series upon the purchase or sale of a
financial futures contract. Initially, a Series will be required to deposit in a
segregated account with its custodian bank an amount of cash, U.S. Treasury
bills or liquid high grade debt obligations. This amount is known as initial
margin and is in the nature of a performance bond or good faith deposit on the
contract. The current initial margin deposit required per contract is
approximately 5% of the contract amount. Brokers may establish deposit
requirements higher than this minimum. Subsequent payments, called variation
margin, will be made to and from the account on a daily basis as the price of
the futures contract fluctuates. This process is known as marking to market.

The writer of an option on a futures contract is required to deposit margin
pursuant to requirements similar to those applicable to futures contracts. Upon
exercise of an option on a futures contract, the delivery of the futures
position by the writer of the option to the holder of the option will be
accompanied by delivery of the accumulated balance in the writer's margin
account. This amount will be equal to the amount by which the market price of
the futures contract at the time of exercise exceeds, in the case of a call, or
is less than, in the case of a put, the exercise price of the option on the
futures contract.

Although financial futures contracts by their terms call for actual delivery or
acceptance of securities, in most cases the contracts are closed out before the
settlement date without the making or taking of delivery. Closing out is
accomplished by effecting an offsetting transaction. A futures contract sale is
closed out by effecting a futures contract purchase for the same aggregate
amount of securities and the same delivery date. If the sale price exceeds the
offsetting purchase price, the seller immediately would be paid the difference
and would realize a gain. If the offsetting purchase price exceeds the sale
price, the seller immediately would pay the difference and would realize a loss.
Similarly, a futures contract purchase is closed out by effecting a futures
contract sale for the same securities and the same delivery date. If the
offsetting sale price exceeds the purchase price, the purchaser would realize a
gain, whereas if the purchase price exceeds the offsetting sale price, the
purchaser would realize a loss. A Series will pay commissions on financial
futures contracts and related options transactions. These commissions may be
higher than those which would apply to purchases and sales of securities
directly.

<PAGE>

Limitations on Futures Contracts and Related Options. A Series may not engage in
transactions in financial futures contracts or related options for speculative
purposes but only as a hedge against anticipated changes in the market value of
its portfolio securities or securities which it intends to purchase. A Series
may not purchase or sell financial futures contracts or related options if,
immediately thereafter, the sum of the amount of initial margin deposits on a
Series' existing futures and related options positions and the premiums paid for
related options would exceed 2% of the market value of a Series' total assets
after taking into account unrealized profits and losses on any such contracts.
At the time of purchase of a futures contract or a call option on a futures
contract, an amount of cash, U.S. Government securities or other appropriate
high-grade debt obligations equal to the market value of the futures contract
minus a Series' initial margin deposit with respect thereto will be deposited in
a segregated account with a Series' custodian bank to collateralize fully the
position and thereby ensure that it is not leveraged. The extent to which a
Series may enter into financial futures contracts and related options also may
be limited by the requirements of the Internal Revenue Code for qualification as
a regulated investment company. See "Taxes."

Risks Relating to Futures Contracts and Related Options. Positions in futures
contracts and related options may be closed out only on an exchange which
provides a secondary market for such contracts or options. A Series will enter
into an option or futures position only if there appears to be a liquid
secondary market. However, there can be no assurance that a liquid secondary
market will exist for any particular option or futures contract at any specific
time. Thus, it may not be possible to close out a futures or related option
position. In the case of a futures position, in the event of adverse price
movements a Series would continue to be required to make daily margin payments.
In this situation, if a Series has insufficient cash to meet daily margin
requirements it may have to sell portfolio securities at a time when it may be
disadvantageous to do so. In addition, a Series may be required to take or make
delivery of the securities underlying the futures contracts it holds. The
inability to close out futures positions also could have an adverse impact on a
Series' ability to hedge its portfolio effectively.

There are several risks in connection with the use of futures contracts as a
hedging device. While hedging can provide protection against an adverse movement
in market prices, it can also preclude a hedger's opportunity to benefit from a
favorable market movement. In addition, investing in futures contracts and
options on futures contracts will cause a Series to incur additional brokerage
commissions and may cause an increase in a Series' portfolio turnover rate.

The successful use of futures contracts and related options also depends on the
ability of the Adviser to forecast correctly the direction and extent of market
movements within a given time frame. To the extent market prices remain stable
during the period a futures contract or option is held by a Series or such
prices move in a direction opposite to that anticipated, a Series may realize a
loss on the hedging transaction which is not offset by an increase in the value
of its portfolio securities. As a result, a Series' return for the period may be
less than if it had not engaged in the hedging transaction.

Utilization of futures contracts by a Series involves the risk of imperfect
correlation in movements in the price of futures contracts and movements in the
price of the securities which are being hedged. If the price of the futures
contract moves more or less than the price of the securities being hedged, a
Series will experience a gain or loss which will not be completely offset by
movements in the price of the securities. It is possible that, where a Series
has sold futures contracts to hedge its portfolio against decline in the market,
the market may advance and the value of securities held in a Series' portfolio
may decline. If this occurred, a Series would lose money on the futures contract
and would also experience a decline in value in its portfolio securities. Where
futures are purchased to hedge against a possible increase in the prices of
securities before a Series is able to invest its cash (or cash equivalents) in
securities (or options) in an orderly fashion, it is possible that the market
may decline; if a Series then determines not to invest in securities (or
options) at that time because of concern as to possible further market decline
or for other reasons, a Series will realize a loss on the futures that would not
be offset by a reduction in the price of the securities purchased.

The market prices of futures contracts may be affected if participants in the
futures market elect to close out their contracts through off-setting
transactions rather than to meet margin deposit requirements. In such case,
distortions in the normal relationship between the cash and futures markets
could result. Price distortions could also result if investors in futures
contracts opt to make or take delivery of the underlying securities rather than
to engage in closing transactions due to the resultant reduction in the
liquidity of the futures market. In addition, due to the fact that, from the
point of view of speculators,

<PAGE>

the deposit requirements in the futures markets are less onerous than margin
requirements in the cash market, increased participation by speculators in the
futures market could cause temporary price distortions. Due to the possibility
of price distortions in the futures market and because of the imperfect
correlation between movements in the prices of securities and movements in the
prices of futures contracts, a correct forecast of market trends may still not
result in a successful hedging transaction.

Compared to the purchase or sale of futures contracts, the purchase of put or
call options on futures contracts involves less potential risk for a Series
because the maximum amount at risk is the premium paid for the options plus
transaction costs. However, there may be circumstances when the purchase of an
option on a futures contract would result in a loss to a Series while the
purchase or sale of the futures contract would not have resulted in a loss, such
as when there is no movement in the price of the underlying securities.

FOREIGN SECURITIES.

Each Series (other than the Money market and U.S. Government Securities Funds)
may purchase foreign securities, including those issued by foreign branches of
U.S. banks. In any event, such investments in foreign securities will be limited
to 15% of the total net asset value of each Series. Investments in foreign
securities, particularly those of non-governmental issuers, involve
considerations which are not ordinarily associated with investing in domestic
issues. These considerations include changes in currency rates, currency
exchange control regulations, the possibility of expropriation, the
unavailability of financial information, the difficulty of interpreting
financial information prepared under foreign securities markets, the impact of
political, social or diplomatic developments, difficulties in invoking legal
process abroad and the difficulty of assessing economic trends in foreign
countries.

The Fund may use a foreign custodian or sub-custodian in connection with its
purchases of foreign securities and may maintain cash and cash equivalents in
the care of a foreign custodian. The amount of cash or cash equivalents
maintained in the care of eligible foreign custodians will be limited to an
amount reasonably necessary to effect the Fund's foreign securities
transactions. The use of a foreign custodian invokes considerations which are
not ordinarily associated with domestic custodians. These considerations include
the possibility of expropriations, restricted access to books and records of the
foreign custodian, inability to recover assets that are lost while under the
control of the foreign custodian, and the impact of political, social or
diplomatic developments.

MORTGAGE-BACKED SECURITIES.

Each Series (other than the Growth Fund) may invest in Mortgage-Related
Securities, including those representing an undivided ownership interest in a
pool of mortgages, such as certificates of the Government National Mortgage
Association ("GNMA") and the Federal Home Loan Mortgage Corporation ("FHLMC").
These certificates are in most cases pass-through instruments, through which the
holder receives a share of all interest and principal payments from the
mortgages underlying the certificate, net of certain fees. The average life of a
Mortgage-Related Security varies with the underlying mortgage instruments, which
have maximum maturities of 40 years. The average life is likely to be
substantially less than the original maturity of the mortgage pools underlying
the securities as the result of prepayments, mortgage refinancings or
foreclosure. Mortgage prepayment rates are affected by various factors including
the level of interest rates, general economic conditions, the location and age
of the mortgage and other social and demographic conditions. Such prepayments
are passed through to the registered holder with the regular monthly payments of
principal and interest and have the effect of reducing future payments.

Government securities with nominal remaining maturities in excess of 3-1/2 years
that have variable or floating interest rates or demand or put features may
nonetheless be deemed to have remaining maturities of 3-1/2 years or less so as
to be permissible investments for the Fund as follows: (a) a government security
with a variable or floating rate of interest will be deemed to have a maturity
equal to the period remaining until the next readjustment of the interest rate;
(b) a government security with a demand or put feature that entitles the holder
to receive the principal amount of the underlying security at the time of or
sometime after the holder gives notice of demand or exercise of the put will be
deemed to have a maturity equal to the period remaining until the principal
amount can be recovered through demand or exercise of the put; and (c) a

<PAGE>

government security with both a variable or floating rate of interest as
described in clause (a) and a demand or put feature as described in clause (b)
will be deemed to have a maturity equal to the shorter of the period remaining
until the next readjustment of the interest rate or the period remaining until
the principal amount can be recovered through demand or exercise of the put.

Securities issued by Government National Mortgage Association ("GNMA") are, and
securities issued by Federal National Mortgage Association ("FNMA") include,
mortgage-backed securities representing part ownership of a pool of mortgage
loans. In the case of GNMA, the mortgages are insured by the Federal Housing
Administration or Farmers' Home Administration or guaranteed by the Veteran's
Administration. In the case of FNMA, the mortgages are not insured by an agency
of the U.S. Government.

The prices of mortgage-backed securities are inversely affected by changes in
interest rates and, therefore, are subject to the risk of market price
fluctuations. Mortgage-backed securities issued by GNMA and FNMA currently offer
yields which are higher than those available on other securities of the U.S.
Government and its agencies and instrumentalities, but may be less effective
than these other securities as a means of "locking in" attractive long-term
interest rates. This is a result of the need to reinvest prepayment of principal
and the possibility of significant unscheduled prepayments resulting from
declines in mortgage interest rates. As a result, these securities have less
potential for capital appreciation during periods of declining interest rates
than other investments of comparable risk of decline in value during periods of
rising rates.

LENDING PORTFOLIO SECURITIES.

In order to increase its return on investments, each Series may make loans of
the portfolio securities as long as the market value of the loaned securities
does not exceed 25% of the value of that Series' total assets. Loans of
portfolio securities will always be fully collateralized at no less than 102% of
the market value of the loaned securities (as marked to market daily) and made
only to borrowers considered to be creditworthy. Lending portfolio securities
involves a risk of delay in the recovery of the loaned securities and possibly
the loss of the collateral if the borrower fails financially.

LOWER RATED FIXED INCOME SECURITIES.

In the event that an issuer of securities held by the Series experiences
difficulties in the timely payment of principal or interest and such issuer
seeks to restructure the terms of its borrowings, the Series may incur
additional expenses and may determine to invest additional assets with respect
to such issuer or the project or projects to which the Series' portfolio
securities relate. Further, the Series may incur additional expenses to the
extent that it is required to seek recovery upon a default in the payment of
interest or the repayment of principal on its portfolio holdings, and the Series
may be unable to obtain full recovery thereof.

To the extent there is no established secondary market for some of the medium
and lower grade income securities in which the Series may invest, trading in
such securities may be relatively inactive. During periods of reduced market
liquidity or in the absence of readily available market quotations for medium
and lower grade income securities held in the Series' portfolio, the ability of
the Investment Adviser to value the Series' securities becomes more difficult
and the Investment Adviser's use of judgment may play a greater role in the
valuation of the Series' securities due to the reduced availability of reliable
objective data. Further, the Series may have more difficulty selling such
securities in a timely manner and at their stated value than would be the case
for securities for which an established secondary market does exist.

Many medium and lower grade income securities are not listed for trading on any
national securities exchange, and many issuers of medium and lower grade income
securities choose not to have a rating assigned to their obligations by any
nationally recognized statistical rating organization. The amount of information
available about the financial condition of an issuer of unrated or unlisted
securities generally is not as extensive as that which is available with respect
to issuers of listed or rated securities. To the extent that the Series invests
in unrated or unlisted medium and lower grade income securities, the ability of
the Adviser to evaluate the credit risk of such securities may play a greater
role in the ability of the Series to achieve its investment objective.

<PAGE>

The Adviser seeks to minimize the risks involved in investing in medium and
lower grade income securities through portfolio diversification, careful
investment analysis, and attention to current developments and trends in the
economy and financial and credit markets. The Series will rely on the Adviser's
judgment, analysis and experience in evaluating the creditworthiness of an
issue. In its analysis, the Adviser will take into consideration, among other
things, the issuer's financial resources, its sensitivity to economic conditions
and trends, its operating history, the quality of the issuer's management and
regulatory matters. Although the Adviser's internal business and default risk
analysis is independent of the credit ratings of S&P, Moody's or D&P (or other
nationally recognized statistical rating organization), the Adviser may consider
such ratings in evaluating income securities. Achievement by the Series of its
investment objective will be more dependent on the credit analysis of the
Adviser than is the case for investment companies with investment objectives
similar to the Series' that are more reliant on such rating organizations in
selecting portfolio securities.

INVESTMENT RESTRICTIONS

The Fund's fundamental policies as they affect any Series cannot be changed
without the approval vote of a majority of the outstanding shares of such
Series, which is the lesser of (i) 67% or more of the voting securities of such
Series present at a meeting if the holders of more than 50% of the outstanding
voting securities of such Series are present or represented by proxy or (ii)
more than 50% of the outstanding voting securities of such Series. A proposed
change in fundamental policy or investment objective will be deemed to have been
effectively acted upon with respect to any Series if a majority of the
outstanding voting securities of that Series votes for the approval of the
proposal as provided above, notwithstanding (1) that such matter has not been
approved by a majority of the outstanding securities of any other Series
affected by such matter and (2) that such matter has not been approved by a
majority of the outstanding voting securities of the Fund.

The following investment restrictions are fundamental policies of the Fund with
respect to all Series and may not be changed except as described above. Each
Series may not:

1. Purchase for such Series securities of any issuer, other than obligations
issued or guaranteed as to principal and interest by the United States
Government or its agencies or instrumentalities, if immediately thereafter (i)
more than 5% of such Series' total assets (taken at market value) would be
invested in the securities of such issuer or (ii) more than 10% of the
outstanding securities of any class of such issuer would be held by such Series
or by all Series of the Fund in the aggregate.

2. Concentrate the portfolio investments of any Series in any one industry. To
comply with this restriction, no security may be purchased for a Series if such
purchase would cause the value of the aggregate investment of such Series in any
one industry to exceed 25% of that Series' total assets (taken at market value).
However, the Money Market Fund may invest more than 25% of its assets in the
domestic banking industry and the Bond Fund may invest up to 80% of that Series'
total assets in corporate debt securities.

3. Act as securities underwriter except as it technically may be deemed to be an
underwriter under the Securities Act of 1933, as amended, in selling a portfolio
security.

4. Purchase securities on margin, but it may obtain short-term credit as may be
necessary for the clearance of purchases and sales of securities.

5. Make short sales of securities or maintain a short position.

6. Make cash loans, except that the Fund may (i) purchase bonds, notes,
debentures or similar obligations which are customarily purchased by
institutional investors whether publicly distributed or not, and (ii) enter into
repurchase agreements, provided that no more than 10% of any Series' net assets
(taken at market value) may be subject to repurchase agreements maturing in more
than seven days.

7. Make securities loans, except that the Bond, Enhanced Reserves and U.S.
Government Securities Funds may make loans of the portfolio securities of any
such Series, provided that the market value of the securities subject to any
such loans does not exceed 25% of the value of the total assets (taken at market
value) of such Series.

<PAGE>

8. Make investments in real estate or commodities or commodity contracts,
although (i) the Fund may purchase securities of issuers which deal in real
estate or commodities and may purchase securities which are secured by interests
in real estate, specifically, securities issued by real estate investment trusts
and (ii) any Series (excluding the Money Market Fund and the U.S. Government
Securities Fund) may engage in transactions in financial futures contracts and
related options, provided that the sum of the initial margin deposits on such
Series' existing futures positions and the premiums paid for related options
would not exceed in the aggregate 2% of such Series' total assets.

9. Invest in oil, gas or other mineral exploration or development programs,
although the Fund may purchase securities of issuers which engage in whole or in
part in such activities.

10. Invest in puts, calls, straddles and any combination thereof, except that
any Series (excluding the Balanced Fund and the U.S. Government Securities Fund)
may (i) write (sell) exchange-traded covered call options on portfolio
securities and on securities indices and engage in related closing purchase
transactions and (ii) invest up to 2% of its total assets in exchange-traded
call and put options on securities and securities indices.

11. Purchase securities of companies for the purpose of exercising management
or control.

12. Participate in a joint or joint and several trading account in securities.

13. Purchase securities of any other investment company except in the open
market at customary brokers' commission rates or as a part of a plan of merger
or consolidation.

14. Purchase for any Series securities of any issuer which together with
predecessors has a record of less than three years' continuous operation, if as
a result more than 5% of the total net assets (taken at market value) of such
Series would then be invested in such securities.

15. Purchase or retain securities of any issuer if any officer or Trustee of the
Fund, or officer or director of its investment adviser, owns beneficially more
than 1/2 of 1% of the outstanding securities or shares, or both, of such issuer
and all such persons owning more than 1/2 of 1% of such securities or shares
together own beneficially more than 5% of such securities or shares.

16. Borrow money.

17. Pledge, mortgage or hypothecate the assets of any Series to an extent
greater than 10% of the total assets (taken at market value) of such Series to
secure borrowing made pursuant to the provisions of item 16 above.

The Fund may purchase illiquid securities, including repurchase agreements
providing for settlement more than seven days after notice and restricted
securities (securities that must be registered with the Securities and Exchange
Commission before they can be sold to the public) deemed to be illiquid, but
such securities will not constitute more than 15% of each Series' net assets.
The Board of Trustees, or the Adviser acting at its direction, values these
securities, taking into consideration quotations available from broker-dealers
and pricing services and other information deemed relevant.

If a percentage restriction is adhered to at the time of investment, a later
increase or decrease in percentage beyond the specified limit resulting from a
change in values of portfolio securities or amount of net assets shall not be
considered a violation of the restrictions.

<PAGE>

PERFORMANCE INFORMATION

Performance information for each Series may appear in advertisements, sales
literature, or reports to shareholders or prospective shareholders. Performance
information in advertisements and sales literature may be expressed as yield and
effective yield of the Money Market Fund, as yield of the other Series offered
and as total return of any Series. Current yield for the Money Market Fund will
be based on the change in the value of a hypothetical investment (exclusive of
capital changes) over a particular 7-day period, less a hypothetical charge
reflecting deductions for expenses during the period (the stated as a percentage
of the investment at the start of the base period (the "base period return").
The base period return is then annualized by multiplying by 365/7, with the
resulting yield figure carried to at least the nearest hundredth of one percent.
"Effective yield" for the Money Market Fund assumes that all dividends received
during an annual period have been reinvested. Calculation of "effective yield"
begins with the same "base period return" used in the calculation of yield,
which is then annualized to reflect weekly compounding pursuant to the following
formula:

Effective Yield = [(Base Period Return) + 1) 365/7] - 1

For the 7-day period ending March 1, 1996, the yield of the Money Market Fund
was % (Class X), and ___% (Class Y) and the effective yield of this Series was [
] % (Class X) and [ ]% (Class Y).

Quotations of yield for the Balanced, Bond, Enhanced Reserves, Growth, and U.S.
Government Securities Funds will be based on all investment income per share
earned during a particular 30-day period (including dividends and interest),
less expenses (including pro rata Fund expenses and expenses applicable to each
particular Series) accrued during the period ("net investment income"), and are
computed by dividing net investment income by the value of a share of the Series
on the last day of the period, according to the following formula:

YIELD = 2[((a-b)) + 1)6 - 1]
------
cd

where,
a = dividends and interest earned during the period by the Series
b = expenses accrued for the period (net of any reimbursements),
c = the average daily number of shares outstanding during the period that were
entitled to receive dividends, and
d = the maximum offering price per share on the last day of the period.

For the period ended December 31, 1995, the yield of each Series existing as a
separate account of Phoenix Home Life Mutual Insurance Company were as follows:
% and % for the Balanced Fund (Classes X and Y, respectively); [ ]% and [ ] %
for the Bond Fund (Classes X and Y, respectively); [ ]% and [ ] % for the Growth
Fund (Classes X and Y, respectively); and, [ ]% and [ ]% for the U.S. Government
Securities Fund (Classes X and Y, respectively).

As summarized in the Prospectus under the heading "Performance History", total
return is a measure of the change in value of an investment in a Series over the
period covered. The formula for total return used herein includes four steps:
(1) adding to the total number of shares purchased by a hypothetical $1,000
investment in the Series; (2) calculating the value of the hypothetical initial
investment of $1,000 as of the end of the period by multiplying the total number
of shares of a Series owned at the end of the period by the net asset value on
the last trading day of the period; (3) assuming maximum sales charge deducted
and reinvestment of all dividends at net asset value and (4) dividing this
account value for the hypothetical investor by the initial $1,000 investment.
Total return will be calculated for one year, five years and ten years or the
time period during which the registration statement including the Series was in
effect if a Series has not been in existence for at least ten years.

<PAGE>

Performance information for the Series (and each Class thereof) reflects only
the performance of a hypothetical investment in a Class X or Class Y of a Series
during the particular time period in which the calculations are based.
Performance information is not an indication of future performance. Performance
information should be considered in light of a particular Series' investment
objectives and policies, characteristics and qualities of the Series, and the
market conditions during the given time period, and should not be considered as
a representation of what may be achieved in the future. Investment results will
vary from time to time and are not identical to the past portfolio investments
of those Series which previously existed as separate accounts. For a description
of the methods used to determine total return, see the Statement of Additional
Information.

The manner in which total return will be calculated for public use is described
above. The following table summarizes the calculation of total return about the
Balanced, Bond, Growth and U.S. Government Securities Funds based on each such
Series' past performance as a separate investment account of Phoenix Home Life
Mutual Insurance Company prior to March 1, 1996. This performance data may be
relevant as each such separate account was managed, in all material respects,
using substantially the same investment objectives, policies and restrictions as
those used by such Series. Standardized average annual total return of each
Class shall be calculated for the preceding one, five and ten year periods (or
since inception of the applicable separate account if it has been in existence
less than five or ten years) by including the corresponding separate account's
total return calculated in accordance with formulas specified by the Securities
and Exchange Commission. The performance of the separate accounts has been
restated to reflect the deduction of the fees and expenses of the classes of the
corresponding Series described in the Prospectus.

AVERAGE ANNUAL TOTAL RETURN AND OF DECEMBER 31, 1995

PERIODS ENDED
1 YEAR 5 YEARS 10 YEARS OR
SINCE INCEPTION
BALANCED
BOND
ENHANCED RSVS. N/A N/A N/A
GROWTH
U.S. GOV'T SEC.

NOTE: Average annual total return assumes a hypothetical initial payment of
$1,000. At the end of each period, a total redemption is assumed. The ending
redeemable value is divided by the original investment to calculate total
return. Performance information for any Series reflects only the performance of
a hypothetical investment in the Series during the particular time period on
which the calculations are based. Performance information should be considered
in light of the investment objectives and policies, characteristics and quality
of the particular Series, and the market conditions during the given time
period, and should not be considered as a representation of what may be achieved
in the future.

PERFORMANCE COMPARISONS

Each Series may from time to time include in advertisements containing total
return the ranking of those performance figures relative to such figures for
groups of mutual funds having similar investment objectives as categorized by
ranking services such as Lipper Analytical Services, Inc., CDA Investment
Technologies, Inc., Weisenberger Financial Services, Inc. and

<PAGE>

rating services such as Morningstar, Inc. Additionally, a Series or Class of
Series may compare its performance results to other investment or savings
vehicles (such as certificates of deposit) and may refer to results published in
various publications such as Changing Times, Forbes, Fortune, Money, Barrons,
Business Week and Investor's Daily, Stanger's Mutual Fund Monitor, The Stanger
Register, Stanger's Investment Adviser, The Wall Street Journal, Pensions &
Investments, Institutional Investor, The New York Times, Consumer Reports,
Registered Representative, Financial Planning, Financial Services Weekly,
Financial World, U.S. News and World Report, Standard and Poors The Outlook, and
Personal Investor. A Series may, from time to time, illustrate the benefits of
tax deferral by comparing taxable investments to investments made through
tax-deferred retirement plans. The total return may also be used to compare the
performance of the Series against certain widely acknowledged outside standards
or indices for stock and bond market performance, such as the Standard & Poor's
500 Stock Index (the "S&P 500"), Dow Jones Industrial Average, Europe Australia
Far East Index (EAFE), Consumer Price Index, Shearson Lehman Corporate Index and
Shearson Lehman T- Bond Index. The S&P 500 is a commonly quoted market
value-weighted and unmanaged index showing the changes in the aggregate market
value of 500 stocks relative to the base period 1941-43. The S&P 500 is composed
almost entirely of common stocks of companies listed on the New York Stock
Exchange, although the common stocks of a few companies listed on the American
Stock Exchange or traded over-the-counter are included. The 500 companies
represented include 400 industrial, 60 transportation and 40 financial services
concerns. The S&P 500 represents about 80% of the market value of all issues
traded on the New York Stock Exchange.

Advertisements, sales literature, and other communications may contain
information about the Adviser's current investment strategies and management
style. Current strategies and style may change to allow the Fund to respond
quickly to changing market and economic conditions. From time to time the Fund
may include specific portfolio holdings or industries. To illustrate components
of overall performance, the Fund may separate its cumulative and average annual
returns into income and capital gains components; or cite separately as a return
figure the equity or bond portion of the Fund's portfolio; or compare the Fund's
equity or bond return figure to well-known indices of market performance,
including but not limited to: the S&P 500 Index, Dow Jones Industrial Average,
First Boston High Yield Index and Salomon Brothers Corporate Bond and Government
Bond Indices.

PORTFOLIO TURNOVER

Each Series has a different expected annual rate of portfolio turnover, which is
calculated by dividing the lesser of purchases or sales of portfolio securities
during the fiscal year by the monthly average of the value of the Series'
securities (excluding from the computation all securities, including options,
with maturities at the time of acquisition of one year or less). A high rate of
portfolio turnover generally involves correspondingly greater brokerage
commission expenses, which must be borne directly by the Series. Turnover rates
may vary greatly from year to year as well as within a particular year and may
also be affected by cash requirements for redemptions of each Series' shares and
by requirements which enable the Fund to receive certain favorable tax
treatment. The 1994 and 1995 annual rates of portfolio turnover for all Series
(based on each such Series' past performance as a separate investment account of
Phoenix Home Life Mutual Insurance Company prior to March 1, 1996) except the
Money Market Fund (which for this purpose does not calculate a portfolio
turnover rate) are set forth in the Prospectus, a copy of which must precede or
accompany this Statement of Additional Information.

For the periods ended December 31, 1994 and December 31, 1995, the turnover
rates for the equity portion of the Balanced Fund were [ ]% and [ ]%,
respectively (based on each such Series' past performance as a separate
investment account of Phoenix Home Life Mutual Insurance Company prior to March
1, 1996). The turnover rates for the fixed income securities portion of such
Series were [ ]% and [ ]%, respectively, for such periods.

<PAGE>

MANAGEMENT OF THE TRUST

The Trustees and executive officers of the Fund and their principal occupations
for at least the last five years are set forth below. Unless otherwise noted,
the address of each executive officer and Trustee is 56 Prospect Street,
Hartford, Connecticut 06115.
<TABLE>
<CAPTION>
Position(s) with Principal Occupation(s)
Name, Address and Age the Fund During Past Five Years
<S> <C> <C>
*Philip R. McLoughlin (49) Trustee/President Vice Chairman and Chief Executive Officer, Phoenix Duff &
Phelps Corporation (1995 -present); Director (1994-present)
and Executive Vice President, Investments, Phoenix Home Life
Mutual Insurance Company (1987-present). Director/Trustee
and President, Phoenix Funds (1989-present). Director, Phoenix
Investment Counsel, Inc. (1983-present). Director (1984-
present) and President (1990-present), Phoenix Equity Planning
Corporation. Director, World Trust Fund (1991-present).
Director, Chairman and Chief Executive Officer, National
Securities & Research Corporation (1993-present) and Phoenix
Securities Group, Inc. (1993-present).

E. Virgil Conway (66)
9 Rittenhouse Road
Bronxville, NY 10708 Trustee Trustee/Director, Consolidated Edison Company of New York,
Inc. (1970-present), Pace University (1978-present), Atlantic
Mutual Insurance Company (1974-present), HRE Properties
(1989-present), Greater New York Councils, Boy Scouts of
America (1985-present), Union Pacific Corp. (1978-present),
Atlantic Reinsurance Company (1986-present), Blackstone Fund
for Fannie Mae Mortgage Securities (Advisory Director) (1989-
present), Centennial Insurance Company, Josiah Macy, Jr.,
Foundation, and The Harlem Youth Development Foundation.
Board Member, Metropolitan Transportation Authority (1992-
present). Chairman, Audit Committee of the City of New York
(1981-present). Director/Trustee, Phoenix Funds (1993-
present). Director, Realty Foundation of New York (1972-
present) and the New York Housing Partnership Development
Corp. (1981- present). Former Director, New York Chamber of
Commerce and Industry (1974-1990).

Herbert Roth, Jr. (67)
134 Lake Street
P.O. Box 909
Sherborn, MA 01770 Trustee Director/Trustee, Phoenix Funds (1980-present).
Director, Boston Edison Company (1978-present),
Phoenix Home Life Mutual Insurance Company
(1972-present), Landauer, Inc. (medical services)
(1970-present), Tech Ops./Sevcon, Inc. (electronic
controllers) (1987-present), Key Energy Group (oil
rig service) (1988-1993), and Mark IV Industries
(diversified manufacturer) (1985-present).

<PAGE>

*Calvin J. Pederson (54)
55 East Monroe Street, Ste. 3800
Chicago, IL 60603 Trustee President, Phoenix Duff & Phelps Corporation
(1995 -present); President and Chief Operating Officer, Duff &
Phelps Corporation (1993 - 1995); President & Chief Executive
Officer, Duff & Phelps Utilities Income Inc. (19 - present);
Director and Executive Vice President, Duff & Phelps Utilities
Tax-Free Income Inc. (19 - present); Director and Executive
Vice President, Duff & Phelps Utility and Corporate Bond Trust
Inc. (19 - present).

William N. Georgeson (67)
575 Glenwood Road
Lake Forest, IL 60045 Trustee Director, Duff & Phelps Utility and Corporate Bond Trust Inc.
(19 - present); Director, Duff & Phelps Utilities Tax-Free
Income Inc. (19 - present); Vice President, Nuveen Advisory
Corp. (19 - 19 ).

Everett L. Morris (66)
164 Laird Road
Colts Neck, NJ 07722 Trustee Vice President, W.H. Reaves and Company (19 - present);
Director, Duff & Phelps Utility and Corporate Bond Trust Inc.
(19 - present); Director, Duff & Phelps Utilities Tax-Free
Income Inc. (19 - Present); Director, Senior Executive Vice
President and Chief Financial Officer, Public Service Enterprise
Diversified Holdings Incorporated (19 - 1992 ); Director, First
Fidelity Bank, N.A. (19 - 1991).
Richard A. Pavia (64)
7145 North Ionia
Chicago, IL 60646 Trustee Director, Speer Financial, Inc. (19 -present). Director, Duff &
Phelps Utility and Corporate Bond Trust Inc. (19 - present);
Director, Duff & Phelps Utilities Tax-Free Income Inc. (19 -
present).

George I. Askew (33) Vice President Phoenix Investment Counsel, Inc. (1994 - present). Merrill
Lynch & Co. (1987 - 1990)(Analyst, Investment Banking),
(1990 - 1992)(Associate, Investment Banking); University of
California at Los Angeles (MBA 1994).
James M. Dolan (46)
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200 Vice President Vice President and Compliance Officer (1994-
present), and Assistant Secretary (1981-present),
Phoenix Equity Planning Corporation. Vice
President, Phoenix Funds (1989-present). Vice
President (1991-present), Assistant Clerk and
Assistant Secretary (1982-present), Phoenix
Investment Counsel, Inc. Vice President and
Compliance Officer, Assistant Secretary (1994-
present), Assistant Vice President (1993-1994),
National Securities & Research Corporation. Vice
President and Chief Compliance Officer, Phoenix

<PAGE>

Realty Advisors, Inc. (1994-present). Chief
Compliance Officer, Phoenix Realty Securities, Inc.
(1995-present). Vice President, the National
Affiliated Investment Companies (until 1993) and
various other positions with Phoenix Equity Planning
Corporation (1978-1994).

Marvin E. Flewellen ()
55 East Monroe Street, Ste. 3800
Chicago, IL 60603 Vice President Vice President and Fixed Income Portfolio Manager, Duff &
Phelps Investment Management Co. (19 - present). Second
Vice President and Portfolio Manager, Northern Trust Bank (19
- 19 ).

Michael E. Haylon (38) Vice President Senior Vice President, Securities Investments,
Phoenix Home Life Mutual Insurance Company
(1993-1995). Vice President, Phoenix Multi-
Sector Fixed Income Fund, Inc. (1993-present), and
The Phoenix Edge Series Fund (1991-present).
Director (1994-present) and Vice President (1991-
present), Phoenix Investment Counsel, Inc.
Managing Director, Aetna Bond Investors (1989-
1990). Director and Executive Vice President (1994-
present), Vice President (1993-1994) National
Securities & Research Corporation. Vice President,
Aetna Capital Management (1986-1990). Various
other positions with Phoenix Home Life Mutual
Insurance Company (1990-1993).

Christopher J. Kelleher (40) Vice President Vice President, National Securities & Research Corporation
(1993-present), The Phoenix Edge Series Fund (1989-present)
and Phoenix Investment Counsel, Inc. (1991-present). Portfolio
Manager, Public Bonds, Phoenix Home Life Mutual Insurance
Company (1991-1995).

Thomas S. Melvin, Jr. (52) Vice President Vice President, Phoenix Investment Counsel, Inc. (1994 -
present). Vice President, National Securities & Research
Corporation (1993-present), Vice President, Phoenix Multi-
Portfolio Fund (1993 - present), Portfolio Manager, Common
Stock, Phoenix Home Life Mutual Insurance Company (1991-
1995), and Portfolio Manager, Constitution Capital Management
(1987 - 1991).

Robert J. Moore ()
55 East Monroe Street, Ste. 3800
Chicago, IL 60603 Vice President Executive Vice President, Duff & Phelps Investment
Management Co. (19 - present). Principal and portfolio
manager, Harris Investment Management (19 - 19 ), and
Portfolio Manager, Ford Motor Company (19 - 19 ).

<PAGE>

William R. Moyer (51)
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200 Vice President Vice President, Investment Products Finance,
Phoenix Home Life Mutual Insurance Company
(1990-1995). Senior Vice President, Finance, and
Treasurer, Phoenix Equity Planning Corporation
(1990-present), and Phoenix Investment Counsel,
Inc. (1990-present). Vice President, Phoenix Funds
(1990-present). Senior Vice President, Finance,
Phoenix Securities Group, Inc. (1993-present).
Senior Vice President, Finance (1993-present), and
Treasurer (1994-present), National Securities &
Research Corporation. Vice President, the National
Affiliated Investment Companies (until 1993). Senior
Vice President and Chief Financial Officer (1993-
1995) and Treasurer (1994-1995) W.S. Griffith
& Co., Inc. and Townsend Financial Advisers, Inc.
Senior Manager, Price Waterhouse (1983-1990).

Leonard J. Saltiel (42) Vice President Vice President, Investment Operations, Phoenix
Home Life Mutual Insurance Company (1994-
1995). Senior Vice President, Phoenix Equity
Planning Corporation (1994-present). Vice President,
Phoenix Funds (1994-present). Vice President,
National Securities & Research Corporation (1994-
present). Various positions with Home Life Insurance
Company and Phoenix Home Life Mutual Insurance
Company (1987-1994).

Dorothy J. Skaret (43) Vice President Vice President, National Securities & Research Corporation
(1993-present). The Phoenix Edge Series Fund (1991-present)
and Phoenix Investment Counsel, Inc. (1991- present), Director,
Public Fixed Income, Phoenix Home Life Mutual Insurance
Company (1991-1995), and various other positions with
Phoenix Home Life Mutual Insurance Company (1986-1991).

James D. Wehr (38) Vice President Vice President, Phoenix Multi-Portfolio Fund (1988-present),
Managing Director, Public Fixed Income, Phoenix Home Life
Mutual Insurance Company, (1991-1995). The Phoenix Edge
Series Fund (1991-present), Phoenix Investment Counsel, Inc.
(1991-present), Phoenix California Tax Exempt Bond Fund, Inc.
(1993-present), and National Securities & Research Corporation
(1993-present). Various positions with Phoenix Home Life
Mutual Insurance Company (1981-1991).

Nancy G. Curtiss (43) Treasurer Treasurer, Phoenix Funds (1994-present). Vice President, Fund
Accounting, Phoenix Equity Planning Corporation (1994-
present). Second Vice President and Treasurer, Fund
Accounting, Phoenix Home Life Mutual Insurance Company
(1994-1995). Various positions with Phoenix Home Life
Insurance Company (1987-1994).

<PAGE>

G. Jeffrey Bohne (48)
101 Munson St.
Greenfield, MA 03101 Secretary Vice President, Transfer Agent Operations, Phoenix Equity
Planning Corporation (1993-present). Secretary, the Phoenix
Funds (1993-present). Vice President and General Manager,
Phoenix Home Life Mutual Insurance Company (1993-1995).
Vice President, Home Life Insurance Company (1984-1992).
</TABLE>

* Trustees identified with an asterisk are considered to be interested persons
of the Fund (within the meaning of the Investment Company Act of 1940, as
amended) because of their affiliation with Phoenix Investment Counsel, Inc.,
Duff & Phelps Investment Management Co., Inc. or Phoenix Equity Planning
Corporation.

At December 31, 1995, the Trustees and officers as a group owned less than 1%
of the then outstanding shares of the Fund.

For services rendered to the Fund during the period ended December 31, 1995, the
Trustees received an aggregate of $0 from the Fund as Trustees' fees. For his
services on the Boards of the Phoenix Funds, each Trustee who is not a full-time
employee of the Adviser or any of its affiliates currently receives a retainer
at the annual rate of $36,000 and $2,000 per joint meeting of the Boards. Each
Trustee who serves on the Audit Committee receives a retainer at the annual rate
of $2,000 and $2,000 per joint Audit Committee meeting attended. Each Trustee
who serves on the Nominating Committee receives a retainer at the annual rate of
$1,000 and $1,000 per joint Nominating Committee meeting attended. Each Trustee
who serves on the Executive Committee and who is not an interested person of the
Fund receives a retainer at the annual rate of $1,000 and $1,000 per joint
Executive Committee meeting attended. For the Fund alone, each Trustee who is
not a full-time employee of the Adviser or any of its affiliates receives for
his services a retainer at the annual rate of $[ ],000 and a fee of $200 per
meeting attended; each Trustee who serves on the Audit Committee receives a
retainer at the annual rate of $200 and $200 per Audit Committee meeting
attended; each Trustee who serves on the Nominating Committee receives a
retainer at the annual rate of $100 and $1,000 per joint Nominating Committee
meeting attended; and each Trustee who serves on the Executive Committee and who
is not an interested person of the Fund receives a retainer at the annual rate
of $100 and $1,000 per joint Executive Committee meeting attended. Officers are
compensated for their services by the Adviser and receive no compensation from
the Fund.

COMPENSATION TABLE
<TABLE>
<CAPTION>

TOTAL
PENSION OR COMPENSATION
RETIREMENT ESTIMATED FROM FUND
BENEFITS ANNUAL AND FUND
AGGREGATE ACCRUED BENEFITS COMPLEX (10
COMPENSATION AS PART OF UPON FUNDS) PAID
NAME FROM FUND FUND EXPENSES RETIREMENT TO TRUSTEES
- ---- ------------ ------------- ---------- -------------
<S> <C> <C> <C> <C>
E. Virgil Conway NONE NONE
Herbert Roth, Jr. NONE NONE
Philip R. McLoughlin NONE NONE NONE NONE
Calvin J. Pederson NONE NONE NONE NONE
William N. Georgeson NONE NONE
Everett L. Morris NONE NONE
Richard A. Pavia NONE NONE

</TABLE>
THE INVESTMENT ADVISERS

The offices of Phoenix Investment Counsel, Inc. ("PIC") are located at 56
Prospect Street, Hartford, Connecticut 06115. The offices of Duff & Phelps
Investment Management Co, Inc. ("DPM") are located at 55 East Monroe Street,
Suite 3800, Chicago, Illinois 60603.

<PAGE>

All of the outstanding stock of PIC is owned by Phoenix Equity Planning
Corporation ("Equity Planning"), a subsidiary of Phoenix Duff & Phelps
Corporation. DPM is also a subsidiary of Phoenix Duff & Phelps Corporation.
Phoenix Duff & Phelps Corporation is an indirect, less than wholly-owned
subsidiary of Phoenix Home Life Mutual Insurance Company ("Phoenix Home Life")
of Hartford, Connecticut. Phoenix Home Life is in the business of writing
ordinary and group life and health insurance and annuities. It was founded in
1851 and at December 31, 1995, had total assets of approximately $[] billion and
insurance in force of approximately $[] billion. Equity Planning, the National
Distributor of the Fund's shares, also performs bookkeeping, pricing, and
administrative services for the Fund. It provides bookkeeping and pricing
services to two other investment companies advised by the Advisers. (See "The
National Distributor"). Equity Planning is registered as a broker-dealer in
fifty states. The principal office of Equity Planning is located at 100 Bright
Meadow Blvd., P.O. Box 2200, Enfield, Connecticut 06083-2200.

All costs and expenses (other than those specifically referred to as being borne
by the Advisers) incurred in the operation of the Fund are borne by the Fund.
Each Series pays expenses incurred in its own operation and also pays a portion
of the Fund's general administration expenses allocated on the basis of the
asset size of the respective Series. Such expenses include, but shall not be
limited to, all expenses incurred in the operation of the Fund and any public
offering of its shares, including, among others, interest, taxes, brokerage fees
and commissions, fees of Trustees who are not employees of the Adviser or any of
its affiliates, expenses of Trustees' and shareholders' meetings, including the
cost of printing and mailing proxies, expenses of insurance premiums for
fidelity and other coverage, expenses of repurchase and redemption of shares,
expenses of issue and sale of shares (to the extent not borne by Equity Planning
under its agreement with the Fund), expenses of printing and mailing stock
certificates representing shares of the Fund, association membership dues,
charges of custodians, transfer agents, dividend disbursing agents and financial
agents, bookkeeping, auditing, and legal expenses. The Fund will also pay the
fees and bear the expense of registering and maintaining the registration of the
Fund and its shares with the Securities and Exchange Commission and registering
or qualifying its shares under state or other securities laws and the expense of
preparing and mailing prospectuses and reports to shareholders.

The investment advisory agreements provide that the Advisers shall not be liable
to the Fund or to any shareholder of the Fund for any error of judgment or
mistake of law or for any loss suffered by the Fund or by any shareholder of the
Fund in connection with the matters to which the investment advisory agreement
relates, except a loss resulting from willful misfeasance, bad faith, gross
negligence or reckless disregard on the part of the Advisers in the performance
of its duties thereunder.

As full compensation for the services and facilities furnished to the Fund, the
Advisers are entitled to a fee, payable within five days after the end of each
month, as described on page [14] in the Prospectus. There is no assurance that
the Fund will reach net asset levels high enough to realize reductions in the
rates of the advisory fees. Any reduction in the rate of the advisory fee on all
Series will be prorated among the Series in proportion to their respective
averages of the aggregate daily net asset values for the period for which the
fee had been paid.

The Advisers have agreed to reimburse the Fund for the amount, if any, by which
the total operating and management expenses of any applicable Series (including
the Adviser's compensation, but excluding interest, taxes, brokerage fees and
commissions and extraordinary expenses) for any fiscal year exceed the level of
expenses which such Series is permitted to bear under the most restrictive
expense limitation imposed on mutual funds by any state in which shares of such
Series are then qualified for sale. Present expense limitations, to the
knowledge of the Fund, require that the Advisers reimburse the Fund, to the
extent of the compensation received by it from the Fund, for the amount, if any,
by which total operating and management expenses (excluding interest, taxes,
brokerage fees and commissions and extraordinary expenses) of any Series in any
fiscal year exceed 2.5% of the first $30,000,000, 2% of the next $70,000,000 and
1.5% of any excess over $100,000,000 of such Series' average net asset value for
such fiscal year. In addition, PIC has voluntarily agreed to assume

<PAGE>

Total Fund Operating Expenses of each Series (other than the Enhanced Reserves
Fund), excluding interest, taxes, brokerage fees, commissions and extraordinary
expenses, until December 31, 2001, to the extent that such expenses exceed the
following percentages of average annual net asset values:

Duff & Phelps Investment Management Co. has voluntarily agreed to reimburse or
waive Total Fund Operating Expenses of the Enhanced Reserves Fund,excluding
interest, taxes, brokerage fees, commissions and extraordinary expenses, until
December 31, 1996, to the extent that such expenses exceed: 0.34% of the average
annual net asset values of Class X Shares of the Enhances Reserves Fund and .89%
of the average annual net asset values of Class Y Shares of the Enhances
Reserves Fund.

The advisory agreements continue in force from year to year for all Series,
provided that, with respect to each Series, the agreement must be approved at
least annually by the Trustees or by vote of a majority of the outstanding
voting securities of the Series. In addition, and in either event, the terms of
the agreement and any renewal thereof must be approved by the vote of a majority
of the Trustees who are not parties to the agreement or interested persons (as
that term is defined in the Investment Company Act of 1940) of any such party,
cast in person at a meeting called for the purpose of voting on such approval.
The agreements will terminate automatically if assigned and may be terminated at
any time, without payment of any penalty, either by the Fund or by the Adviser,
on sixty (60) days written notice.

For services to the Fund during the periods ended December 31, 1993, 1994 and
1995, PIC received fees of $[ ], $[ ] and $[ ] respectively under the investment
advisory agreements in effect for such separate accounts. Of these totals, PIC
received fees from each separate account as follows:

1993 1994 1995
Balanced Fund (Sep. Acct. L) $ $ $
Bond Fund (Sep. Acct. P)
Growth Fund (Sep. Acct. S)
Money Market Fund (Sep. Acct. G)
U.S. Government Fund (Sep. Acct. U)

DPM received no advisory fees with respect to the Enhanced Reserves Fund prior
to December 31, 1995.

For the periods ended December 31, 1993, 1994 and 1995, neither Adviser was
reimbursed for any expenses incurred in providing services which would otherwise
have been provided at the expense of the Fund.

BROKERAGE ALLOCATION

In effecting portfolio transactions for the Fund, the Advisers adhere to the
Fund's policy of seeking best execution and price, determined as described
below, except to the extent it is permitted to pay higher brokerage commissions
for "brokerage and research services" as defined herein. The Advisers may cause
the Fund to pay a broker an amount of commission for effecting a securities
transaction in excess of the amount of commission which another broker or dealer
would have charged for effecting the transaction if the Advisers determine in
good faith that such amount of commission is reasonable in relation to the value
of the brokerage and research services provided by such broker or that any
offset of direct expenses of a Series yields the best net price. As provided in
Section 28(e) of the Securities Exchange Act of 1934, "brokerage and research
services" include giving advice as to the value of securities, the advisability
of investing in, purchasing or selling securities, and the availability of
securities; furnishing analyses and reports concerning issuers, industries,
economic factors and trends,

<PAGE>

portfolio strategy and the performance of accounts; and effecting securities
transactions and performing functions incidental thereto (such as clearance and
settlement). Brokerage and research services provided by brokers to the Fund or
to the Adviser are considered to be in addition to and not in lieu of services
required to be performed by the Advisers under their contracts with the Fund and
may benefit both the Fund and other clients of the Advisers. Conversely,
brokerage and research services provided by brokers to other clients of the
Advisers may benefit the Fund.

If the securities in which a particular Series of the Fund invests are traded
primarily in the over-the-counter market, where possible the Series will deal
directly with the dealers who make a market in the securities involved unless
better prices and execution are available elsewhere. Such dealers usually act as
principals for their own account. On occasion, securities may be purchased
directly from the issuer. Bonds and money market instruments are generally
traded on a net basis and do not normally involve either brokerage commission or
transfer taxes.

The determination of what may constitute best execution and price in the
execution of a securities transaction by a broker involves a number of
considerations including, without limitation, the overall direct net economic
result to the Fund (involving both price paid or received and any net
commissions and other costs paid), the efficiency with which the transaction is
effected, the ability to effect the transaction at all where a large block is
involved, the availability of the broker to stand ready to execute possibly
difficult transactions in the future and the financial strength and stability of
the broker. Such considerations are judgmental and are weighed by the Adviser in
determining the overall reasonableness of brokerage commissions paid by the
Fund. Some portfolio transactions are, subject to the Rules of Fair Practice of
the National Association of Securities Dealers, Inc. and subject to obtaining
best prices and executions, effected through dealers (excluding Equity Planning)
who sell shares of the Fund.

For the periods ended December 31, 1993, 1994 and 1995, brokerage commissions
paid by Phoenix Home Life with respect to the above referenced separate accounts
for portfolio transactions totaled $[ ], $[ ] and $[ ] respectively. Brokerage
commissions of $[ ] paid during the period ended December 31, 1995, were paid on
portfolio transactions aggregating $[] executed by brokers who provided research
and other statistical and factual information. None of such commissions was paid
to a broker who was an affiliated person of the Fund or an affiliated person of
such a person or, to the knowledge of the Fund, to a broker an affiliated person
of which was an affiliated person of the Fund, its adviser or its national
distributor.

DETERMINATION OF NET ASSET VALUE

The net asset value of shares of the Fund is determined once daily as of the
close of trading on the New York Stock Exchange on each day during which the
Exchange is open for trading. The New York Stock Exchange is scheduled to be
closed for trading on the following days: New Years Day, Washington's Birthday,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day. The Board of Directors of the Exchange reserves the right to
change this schedule as conditions warrant.

Balanced, Bond, Growth, Enhanced Reserves and U.S. Government Securities Funds

In determining the value of the assets of each Series other than the Money
Market Fund, the securities for which market quotations are readily available
are valued at market value, which is currently determined using the last
reported sale price, or, if no sales are reported--as is the case with many
securities traded over-the-counter--the last reported bid price. Debt securities
(other than short-term obligations, which are valued on the basis of amortized
cost as defined below) are normally valued on the basis of valuations provided
by a pricing service when such prices are believed to reflect the fair value of
such securities. Prices provided by the pricing service may be determined
without exclusive reliance on quoted prices and take into account appropriate
factors such as institution-size trading in similar groups of securities, yield,
quality of issue, trading characteristics and other market data. All other
securities and assets are valued at their fair value as determined in good faith
by the Trustees although the actual calculations may be made by persons acting
pursuant to the direction of the Trustees.

<PAGE>

Money Market Fund

The assets of the Money Market Fund are valued on the basis of amortized cost
absent extraordinary or unusual market conditions. Under the amortized cost
method of valuation, securities are valued at cost on the date of purchase.
Thereafter the value of a security is increased or decreased incrementally each
day so that at maturity any purchase discount or premium is fully amortized and
the value of the security is equal to its principal amount. Due to fluctuations
in interest rates, the amortized cost value of the Money Market Fund securities
may at times be more or less than their market value. By using amortized cost
valuation, the Money Market Fund seeks to maintain a constant net asset value of
$1.00 per share despite minor shifts in the market value of its portfolio
securities.

The yield on a shareholder's investment may be more or less than that which
would be recognized if the Series' net asset value per share was not constant
and was permitted to fluctuate with the market value of the Series' portfolio
securities. However, as a result of the following procedures, it is believed
that any difference will normally be minimal. The deviation is monitored
periodically by comparing the Series net asset value per share as determined by
using available market quotations with its net asset value per share as
determined through the use of the amortized cost method of valuation. The
Adviser will advise the Trustees promptly in the event of any significant
deviation. If the deviation exceeds 1/2 of 1%, the Trustees will consider what
action, if any, should be initiated to provide fair valuation of the Series'
portfolio securities and prevent material dilution or other unfair results to
shareholders. Such action may include redemption of shares in kind, selling
portfolio securities prior to maturity, withholding dividends or utilizing a net
asset value per share as determined by using available market quotations.
Furthermore, the assets of the Series will not be invested in any security with
a maturity of greater than 397 days, and the average weighted maturity of its
portfolio will not exceed 90 days. Portfolio investments will be limited to U.S.
dollar-denominated securities which present minimal credit risks and are of high
quality as determined either by a major rating service or, if not rated, by the
Trustees.

PURCHASE OF SHARES

The Prospectus includes information as to the offering price of shares of the
Series and the minimum initial and subsequent investments which may be made in a
Series. Sales of shares are made through registered representatives of the
National Distributor, Equity Planning, or through securities dealers with whom
Equity Planning has sales agreements. Sales of shares are also made to customers
of bank affiliated securities brokers with whom Equity Planning has sales
agreements. Customers purchase shares at the applicable offering price.

Each Series currently declares all income dividends and all capital gain
distributions, if any, payable in shares of the Series at net asset value or, at
the option of the shareholder, in cash. The Money Market Fund will normally make
no capital gain distributions, since its investments will generally be made in
securities which do not generate capital gains. Unless otherwise specified in
writing, shareholders shall automatically receive both dividends and capital
gain distributions in additional shares. If a shareholder elects to receive
dividends and/or distributions in cash and the check cannot be delivered or
remains uncashed by the shareholder due to an invalid address, then the dividend
and/or distribution will be reinvested after the Transfer Agent has been
informed that the proceeds are undeliverable. Additional shares will be
purchased for the shareholder's account at the then current net asset value.
Reinvestment direction forms and prospectuses are available from Equity
Planning. An alternate payee section has been incorporated into the application
allowing distributions to be mailed to a second payee and/or address. Dividends
and capital gain distributions received in shares are taxable to the shareholder
and credited in full and fractional shares computed at the closing net asset
value on the next business day after the record date. To be effective with
respect to a particular dividend or distribution, notification of the new
distribution option must be received by the Transfer Agent at least three days
prior to the record date of such dividend or distribution. If all shares in the
shareholder's account are repurchased or redeemed or transferred between the
record date and the payment date of a dividend or distribution, he will receive
cash for the dividend or distribution regardless of the distribution option
selected.

<PAGE>

TAXES

As stated in the Prospectus, each Series is treated as a separate entity for
federal income tax purposes. Each Series intends to elect to be treated as a
regulated investment company ("RIC") and qualify as such under Subchapter M of
the Internal Revenue Code (the "Code").

The Code sets forth numerous criteria which must be satisfied in order for each
Series to qualify as a RIC. Each Series must, among other things, meet the
following tests for each taxable year: (1) at least 90% of the Series' gross
income must be derived from a) dividends, b) interest, c) payments with respect
to securities loans, d) gains from the sale or other disposition of stocks or
securities or foreign currencies, or e) other income (including but not limited
to gains from options, futures, or forward contracts) derived by the Series with
respect to its business of investing in stocks, securities or currencies; (2)
less than 30% of the Series' gross income must be derived from gains realized on
the sale or other disposition of: a) stocks or securities b) options, futures or
forward contracts (other than options, futures, or forward contracts on foreign
currencies) held less than three months; and c) foreign currencies (or options,
futures, or forward contracts) not directly related to the Series business of
investing in stocks or securities; and (3) distribute annually at least 90% of
its investment company taxable income and net exempt-interest income.

In addition to the gross income tests, to qualify as a RIC, each Series must
also diversify its holdings so that, at the close of each quarter of its taxable
year, (1) at least 50% of the value of its total assets consists of cash, cash
items, U.S. Government securities, and other securities limited generally with
respect to any one issuer to not more than 5% of the total assets of the Series
and not more than 10% of the outstanding voting securities of such issuer, and
(2) not more than 25% of the value of its total assets is invested in the assets
of any one issuer (other than U.S. Government securities). If in any taxable
year a Series does not qualify as a RIC, all of its net investment income and
realized capital gains will be taxed at corporate rates.

In each taxable year that a Series qualifies as a RIC, it (but not its
shareholders) will be relieved of federal income tax on that portion of its net
investment income and net capital gains that are currently distributed (or
deemed distributed) to its shareholders. It is the policy of each Series to
distribute all of its net investment income and net capital gains to its
shareholders in order to avoid any federal income tax liability. In addition,
each Series intends to make timely distribution sufficient in amount to avoid a
non-deductible 4% excise tax. An excise tax will be imposed on each Series to
the extent that it fails to distribute, with respect to each calendar year, at
least 98% of its net ordinary income for such calendar year and 98% of its net
capital gains as determined for the one year period ending December 31 of such
calendar year. In addition, an amount equal to the undistributed net ordinary
income and net capital gains from the previous calendar year must also be
distributed to avoid the excise tax.

Each Series is required to withhold for income taxes 31% of dividends,
distributions and redemption payments, if any of the following circumstances
exist: i) a shareholder fails to provide the Series with a correct taxpayer
identification number (TIN); ii) the Series is notified by the Internal Revenue
Service that the shareholder furnished an incorrect TIN; or iii) the Series is
notified by the Internal Revenue Service that withholding is required because
the shareholder failed to report the receipt of dividends or interest from other
sources. Withholding may also be required for accounts with respect to which a
shareholder fails to certify that i) the TIN provided is correct and ii) the
shareholder is not subject to such withholding. However, withholding will not be
required from certain exempt entities nor those shareholders complying with the
procedures as set forth by the Internal Revenue Service. A shareholder is
required to provide the Series with a correct TIN. The Fund in turn is required
to report correct taxpayer identification numbers when filing all tax forms with
the Internal Revenue Service. Should the IRS levy a penalty on a Series for
reporting an incorrect TIN and that TIN was provided by the shareholder, the
Series will pass the penalty onto the shareholder.

Dividends paid by a Series from net investment income and net realized
short-term capital gains to a shareholder who is a nonresident alien individual,
a foreign Fund or estate, a foreign corporation or a foreign partnership (a
foreign shareholder) will be subject to United States withholding tax at a rate
of 30% unless a reduced rate of withholding or a withholding exemption is
provided under applicable treaty law. Foreign shareholders are urged to consult
their own tax advisors concerning the applicability of the United States
withholding tax and any foreign taxes.

<PAGE>

The discussion of "Taxes" in the Prospectus, in conjunction with the foregoing,
is a general and abbreviated summary of applicable provisions of the Code and
Treasury regulations now in effect as currently interpreted by the courts and
the Internal Revenue Series. The Code and regulations, as well as the current
interpretations thereof, may be changed at any time by legislative, judicial, or
administrative action. Shareholders are urged to consult with their tax advisor
regarding specific questions as to federal, state, local or foreign taxes.

THE NATIONAL DISTRIBUTOR

Phoenix Equity Planning Corporation ("Equity Planning"), which has undertaken to
use its best efforts to find purchasers for shares of the Fund, serves as the
National Distributor of the Fund's shares. Shares of each Series are offered on
a continuous basis. Pursuant to distribution agreements for each class of shares
or distribution method, the Distributor will purchase shares of the Fund for
resale to the public, either directly or through securities dealers or agents,
and is obligated to purchase only those shares for which it has received
purchase orders. Equity Planning may also sell Fund shares pursuant to sales
agreements entered into with bank-affiliated securities brokers who, acting as
agent for their customers, place orders for Fund shares with Equity Planning.
Although the Glass-Steagall Act prohibits banks and bank affiliates from
engaging in the business of underwriting, distributing or selling securities
(including mutual fund shares), banking regulators have not indicated that such
institutions are prohibited from purchasing mutual fund shares upon the order
and for the account of their customers. In addition, state securities laws on
this issue may differ from the interpretations of federal law and banks and
financial institutions may be required to register as dealers pursuant to state
law. If, because of changes in law or regulations, or because of new
interpretations of existing law, it is determined that agency transactions of
bank-affiliated securities brokers are not permitted, the Trustees will consider
what action, if any, is appropriate. It is not anticipated that termination of
sales agreements with bank-affiliated securities brokers would result in a loss
to their customers or a change in the net asset value per share of a Series.

For the periods ended December 31, 1993, 1994 and 1995, Equity Planning received
no commissions on sales of Fund shares.

Philip R. McLoughlin is a Trustee and an officer of the Fund and a director and
officer of Equity Planning. G. Jeffrey Bohne, James M. Dolan, William R. Moyer,
Leonard J. Saltiel, and Nancy G. Curtiss are officers of the Fund and officers
of Equity Planning.

Pursuant to a Financial Agent Agreement, Equity Planning provides bookkeeping
and pricing services directly to the Fund. As compensation for such services,
Equity Planning receives a quarterly fee based on the average of the aggregate
daily net asset values of the Fund at an annual rate of $300 per million
dollars. It is expected that the compensation to Equity Planning will be
approximately equal to the cost to Equity Planning of providing the services
provided for in the Financial Agent Agreement.

In addition, pursuant to an agreement between Equity Planning, the Fund's
Transfer Agent, and State Street Bank and Trust Company, State Street has been
appointed subagent to perform certain shareholder servicing functions for the
Fund. For performing such services State Street receives a monthly fee from
Equity Planning.

Equity Planning received no fees as financial agent for administrative services
to the Fund during the periods ended December 31, 1993, 1994 and 1995.

FINANCIAL STATEMENTS

Financial information relating to the Fund is contained in the Annual Report of
Pooled Separate Accounts (the "Annual Report") for the year ended December 31,
1995 and is available by calling Equity Planning at (800) 817-1897, or by
writing to Equity Planning at 100 Bright Meadow Blvd., P.O. Box 2200, Enfield,
Connecticut 06083-2200. The Annual Report is incorporated into this Statement of
Additional Information by reference. A copy of the Annual Report must precede or
accompany this Statement of Additional Information.

<PAGE>

PART C. OTHER INFORMATION

<TABLE>
<CAPTION>
Item 24. Financial Statements and Exhibits:
<S> <C>
(a) Financial Statements:
Included in Part A of the Registration Statement:
Financial Highlights

Included in Part B of the Registration Statement:
Independent Auditors' Report
Financial Statements
Notes to Financial Statements

No financial statements have been included
for the Fund.

(b) Exhibits:*
(1) Declaration of Trust of the Registrant
(2) None
(3) None
(4) Reference is made to Article , Section of Registrant's Declaration
of Trust
(5)(a) Investment Advisory Agreement between Registrant and Duff & Phelps Investment
Management Co. ("DPM")
(b) Investment Advisory Agreement between Registrant and Phoenix Investment
Counsel, Inc. ("PIC")
(6) Distribution Agreement between Registrant and Phoenix Equity Planning
Corporation
(7) None
(8)(a) Custodian Agreement between Registrant and State Street Bank and Trust Company
(b) Custodian Agreement between Registrant and The Chase Manhattan Bank, N.A.
(9)(a) Financial Agent Agreement between Registrant and Phoenix Equity Planning
Corporation
(b) Transfer Agent Agreement between Registrant and Phoenix Equity Planning
Corporation
(c) Sub-Transfer Agent Agreement between Phoenix Equity Planning Corporation and
State Street Bank & Trust Company
(10) Opinion of Counsel
(11) Consent of Accountants
(12) None
(13) Initial Capitalization Agreement
(14) None
(15) Rule 12b-1 Distribution Plan for Class Y Shares
(16) Schedule for Computation of Performance Quotations
(17) Not yet applicable.
(18) Rule 18f-3 Dual Distribution Plan
</TABLE>
- -----------
* To Be Filed By Amendment

C-1

<PAGE>
Item 25. Persons Controlled by or under Common Control with Registrant.

As of the date hereof, to the best knowledge of the Registrant, no person is
directly or indirectly controlled by or under common control with the
Registrant.

Item 26. Number of Holders of Securities.

As of December 31 , 1995:

Class X Shares ClassYShares
Number of Number of
Record Holders Record Holders
-------------- --------------
Bond Fund 0 0
Balanced Fund 0 0
Enhanced Reserves Fund 0 0
Growth Fund 0 0
Money Market Fund 0 0
U.S. Gov't Sec. Fund 0 0

Item 27. Indemnification.

Please see Article of the Registrant's Declaration of Trust (incorporated herein
by reference). Registrant's trustees and officers are covered by an Errors and
Omissions Policy. Sections [ ] of the Investment Advisory Agreements between the
Registrant and its Advisers provide that, in the absence of willful malfeasance,
bad faith, gross negligence or reckless disregard of the obligations or duties
under the Investment Advisory Agreements on the part of each the Adviser, the
Advisers shall not be liable to the Registrant or to any shareholder for any act
or omission in the course of or connected in any way with rendering services or
for any losses that may be sustained in the purchase, holding or sale of any
security.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to trustees, directors, officers and controlling persons
of the Registrant and the investment advisers and distributor pursuant to the
foregoing provisions or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a trustee,
director, officer, or controlling person of the Registrant and the principal
underwriter in connection with the successful defense or any action, suit or
proceeding) is asserted against the Registrant by such trustee, director,
officer or controlling person or the Distributor in connection with the shares
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

Item 28. Business and Other Connections of Investment Adviser.

See "Management of the Fund" in the Prospectus and "Management of the Trust" in
the Statement of Additional Information for information regarding the business
of the Advisers. For information as to the business, profession, vocation or
employment of a substantial nature of directors and officers of the Advisers,
reference is made to the Advisers' current Form ADV (SEC File Nos. 801- 5995
(PIC) & 14813 (DPM)) filed under the Investment Advisers Act of 1940,
incorporated herein by reference.

C-2

<PAGE>

Item 29. Principal Underwriter.

(a) The sole principal underwriter for the Registrant is
Phoenix Equity Planning Corporation.

(b) The directors and executive officers of Phoenix Equity
Planning Corporation., the distributor for Registrant,
are as follows:

<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
<S> <C> <C>
Martin J. Gavin Director and Vice President
56 Prospect Street Executive Vice President
P.O. Box 150480
Hartford, CT 06115-0480
Michael E. Haylon Director Vice President
56 Prospect Street
P.O. Box 150480
Hartford, CT 06115-0480
Philip R. McLoughlin Director and Trustee and President
One American Row President
Hartford, CT 06115
Leonard J. Saltiel Senior Vice President Vice President
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200
William R. Moyer Senior Vice President, Vice President
100 Bright Meadow Blvd. Finance and Treasurer
P.O. Box 2200
Enfield, CT 06083-2200
G. Jeffrey Bohne Vice President, Secretary
100 Bright Meadow Blvd. Transfer Agent Operations
P.O. Box 2200
Enfield, CT 06083-2200
Nancy G. Curtiss Vice President, Treasurer
56 Prospect Street Fund Accounting
P.O. Box 150480
Hartford, CT 06115-0480
Maris Lambergs Vice President, None
100 Bright Meadow Blvd. National Sales Manager
P.O. Box 2200
Enfield, CT 06083-2200

C-3

<PAGE>

Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
James M. Dolan Vice President and Vice President
100 Bright Meadow Blvd. Compliance Officer;
P.O. Box 2200 Assistant Secretary
Enfield, CT 06083-2200
William J. Newman Senior Vice President None
56 Prospect Street
P.O. Box 150480
Hartford, CT 06115-0480
Elizabeth R. Sadowinski Vice President, None
100 Bright Meadow Blvd. Field and Investor Services
P.O. Box 2200
Enfield, CT 06083-2200
Eugene A. Charon Controller None
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200
Thomas N. Steenburg Secretary None
One American Row
Hartford, CT 06115

(c) To the best of the Registrant's knowledge,
all commissions and other compensation
received by each principal underwriter who
is not an affiliated person of the
Registrant or an affiliated person of such
affiliated person, directly or indirectly,
from the Registrant during the Registrant's
last fiscal year is as follows:

(1) (2) (3) (4) (5)
Net Underwriting Compensation on
Name of Principal Discounts and Redemption and Brokerage Other
Underwriter Commissions repurchase Commissions Compensation
</TABLE>

[Table to Follow]

Item 30. Location of Accounts and Records.

All accounts, books and other documents required to be maintained by the
Registrant by Section 31(a) of the Investment Company Act of 1940 and the Rules
thereunder will be maintained at the offices of the Registrant located at 56
Prospect Street, Hartford, CT 06115, or its investment advisers, Duff & Phelps
Investment Management Co., 55 East Monroe Street, Suite 3800, Chicago, Illinois
60610, Phoenix Investment Counsel, Inc., 56 Prospect Street, Hartford, CT 06115,
or the custodians, State Street Bank and Trust Company, 1 Heritage Drive, P2N,
North Quincy, MA 02171 or The Chase Manhattan Bank, N.A., 1 Chase Manhattan
Plaza, Floor 3B, New York, NY 10081. All such accounts, books and other
documents required to be maintained by the principal underwriter will be
maintained at Phoenix Equity Planning Corporation, 100 Bright Meadow Boulevard,
Enfield, Connecticut 06083.

C-4

<PAGE>

Item 31. Management Services.

None.

Item 32. Undertakings.

(a) Not applicable.
(b) Registrant undertakes to
file a post-effective amendment using financial
statements, which need not be certified, within
four to six months from the effective date of the
Registrant's Registration Statement with respect
to the Fund.

(c) Registrant undertakes to furnish to each person
to whom a prospectus is delivered a copy of the
Registrant's latest annual report to shareholders
upon request and without charge if the information
called for by Item 5A of Form N-1A is contained in
such annual report.

(d) Registrant undertakes to provide the
information specified pursuant to Regulation S-K,
Item 512 (Reg. ss.229.512), as applicable, the
terms of which are incorporated herein by
reference.

C-5

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the undersigned Trustees of the Registrant have duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereto duly authorized in the City of Hartford, and State of Connecticut on the
4th day of December, 1995.

PHOENIX DUFF & PHELPS
INSTITUTIONAL MUTUAL FUNDS

By: /s/ Thomas N. Steenburg
-----------------------
Name: Thomas N. Steenburg
Title: President

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities
indicated on the 4th day of December, 1995.

Signature Title

/s/ Richard J Wirth Trustee
- -------------------
Richard J. Wirth

/s/ Thomas N. Steenburg Trustee
- -----------------------
Thomas N. Steenburg

/s/ Nancy G. Curtiss Treasurer
- --------------------
Nancy G. Curtiss (Principal Financial and Accounting Officer)

S-1