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July 1, 2000
FUND PROFILE
T. ROWE PRICE
Mid-Cap Value Fund
A stock fund seeking long-term capital appreciation through investments in
mid-size companies whose stocks appear undervalued.
This profile summarizes key information about the fund that is included in the
fund's prospectus. The fund's prospectus includes additional information about
the fund, including a more detailed description of the risks associated with
investing in the fund that you may want to consider before you invest. You may
obtain the prospectus and other information about the fund at no cost by calling
1-800-638-5660, or by visiting our Web site at www.troweprice.com.
TROWEPRICELOGO
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FUND PROFILE
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What is the fund's objective?
The fund seeks to provide long-term capital appreciation by investing
primarily in mid-size companies that appear to be undervalued.
What is the fund's principal investment strategy?
We will invest at least 65% of total assets in companies whose market
capitalization (number of shares outstanding multiplied by share price) falls
within the range of companies in the S&P MidCap 400 Index. However, the fund
will not automatically sell or cease to purchase stock of a company it
already owns just because the company's market capitalization grows or falls
outside this range.
We follow a value approach in selecting investments. Our in-house research
team seeks to identify companies whose stock prices do not appear to reflect
their underlying values.
In selecting investments, we generally favor companies with the following:
. attractive operating margins;
. sound balance sheet and financial management;
. stock ownership by management;
. significant cash generation; or
. low stock price relative to assets, earnings, cash flow, or business
franchises.
While most assets will be invested in U.S. common stocks, other securities
may also be purchased, including foreign stocks, futures, and options, in
keeping with fund objectives.
The fund may sell securities for a variety of reasons, such as to secure
gains, limit losses, or redeploy assets into more promising opportunities.
Further information about the fund's investments, including a review of
market conditions and fund strategies and their impact on performance, is
available in the annual and semiannual shareholder reports. To obtain free
copies of either of these documents, call 1-800-638-5660.
What are the main risks of investing in the fund?
As with all equity funds, this fund's share price can fall because of
weakness in the broad market, a particular industry, or specific holdings.
The market as a whole can decline for many reasons, including adverse
political or economic developments here or abroad, changes in investor
psychology, or heavy institutional selling. The prospects for an industry or
company may deteriorate because of a variety of factors, including
disappointing earnings or changes in the competitive environment. In
addition, our assessment of companies held in the fund may prove incorrect,
resulting in losses or poor per-
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formance even in a rising market. Finally, the fund's investment approach
could fall out of favor with the investing public, resulting in lagging
performance versus other types of stock funds.
The stocks of mid-cap companies entail greater risk and are usually more
volatile than those of larger companies. In addition, the fund's value
approach carries the risks that the market will not recognize a security's
intrinsic value for a long time, or that a stock judged to be undervalued may
actually be appropriately priced.
Foreign stock holdings are subject to the risk that some holdings may lose
value because of declining foreign currencies or adverse political or
economic events overseas. Investments in futures and options, if any, are
subject to additional volatility and potential losses.
As with any mutual fund, there can be no guarantee the fund will achieve its
objective.
. The fund's share price may decline, so when you sell your shares, you may
lose money. An investment in the fund is not a deposit of a bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency.
How can I tell if the fund is appropriate for me?
Consider your investment goals, your time horizon for achieving them, and
your tolerance for risk. If you can accept the greater risk of investing in
mid-cap companies in an effort to achieve significant capital appreciation,
the fund could be an appropriate part of your overall investment strategy.
The fund should not represent your complete investment program or be used for
short-term trading purposes.
The fund can be used in both regular and tax-deferred accounts, such as IRAs.
. Equity investors should have a long-term investment horizon and be willing
to wait out bear markets.
How has the fund performed in the past?
The bar chart showing calendar year returns and the average annual total
return table indicate risk by illustrating how much returns can differ from
one year to the next and over time. Fund past performance is no guarantee of
future returns.
The fund can also experience short-term performance swings, as shown by the
best and worst calendar quarter returns during the years depicted in the
chart.
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LOGO
<TABLE>
<CAPTION>
Calendar Year Total Returns
"97" "98" "99"
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<S> <C> <C>
27.11 1.39 3.52
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</TABLE>
Quarter ended Total return
Best quarter 12/31/98 13.64%
Worst quarter 9/30/98 -15.90%
<TABLE>
Table 1 Average Annual Total Returns
<CAPTION>
Periods ended 06/30/2000
Since inception
1 year (06/28/1996)
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<S> <C> <C>
Mid-Cap Value Fund -0.74% 12.31%
S&P MidCap 400 Index 16.98 21.08
Lipper Mid-Cap Value Funds Average 5.49 12.00
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</TABLE>
These figures include changes in principal value, reinvested dividends, and
capital gain distributions, if any.
What fees or expenses will I pay?
The fund is 100% no load. There are no fees or charges to buy or sell fund
shares, reinvest dividends, or exchange into other T. Rowe Price funds. There
are no 12b-1 fees.
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<TABLE>
Table 2 Fees and Expenses of the Fund
<CAPTION>
Annual fund operating expenses
(expenses that are deducted from fund assets)
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<S> <C>
Management fee 0.67%/ // /
Other expenses 0.37%
Total annual fund operating 1.04%/ // /
expenses
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</TABLE>
Example. The following table gives you a rough idea of how expense ratios
may translate into dollars and helps you to compare the cost of investing in
this fund with that of other funds. Although your actual costs may be higher
or lower, the table shows how much you would pay if operating expenses remain
the same, you invest $10,000, earn a 5% annual return, and hold the
investment for the following periods:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
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<S> <C> <C> <C>
$106 $331 $574 $1,271
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</TABLE>
Who manages the fund?
The fund is managed by T. Rowe Price Associates, Inc. Founded in 1937, T.
Rowe Price and its affiliates manage investments for individual and
institutional accounts. The company offers a comprehensive array of stock,
bond, and money market funds directly to the investing public.
Gregory A. McCrickard manages the fund day-to-day and has been chairman of
its Investment Advisory Committee since 1996. He joined T. Rowe Price in 1986
and has been managing investments since 1991.
Note: The following questions and answers about buying and selling shares and
services do not apply to employer-sponsored retirement plans. If you are a
participant in one of these plans, please call your plan's toll-free number for
additional information.
How can I purchase shares?
Fill out the New Account Form and return it with your check in the postpaid
envelope. The minimum initial purchase is $2,500 ($1,000 for IRAs and gifts
or transfers to minors). The minimum subsequent investment is $100 ($50 for
IRAs, gifts or transfers to minors, or Automatic Asset Builder). You can also
open an account by bank wire, by exchanging from another T. Rowe Price fund,
or by transferring assets from another financial institution.
How can I sell shares?
You may redeem or sell any portion of your account on any business day.
Simply write to us or call. You can also access your account at any time via
Tele*Access /(R)/ or our Web site. We offer convenient exchange among our
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entire family of domestic and international funds. Restrictions may apply in
special circumstances, and some redemption requests need a signature
guarantee. A $5 fee is charged for wire redemptions under $5,000.
When will I receive income and capital gain distributions?
The fund distributes income and net capital gains, if any, at year-end. For
regular accounts, income and short-term gains are taxable at ordinary income
rates, and long-term gains are taxable at the capital gains rate.
Distributions are reinvested automatically in additional shares unless you
choose another option, such as receiving a check. Distributions paid to IRAs
and employer-sponsored retirement plans are automatically reinvested.
What services are available?
A wide range, including but not limited to:
. retirement plans for individuals and large and small businesses;
. automated information and transaction services by telephone or computer;
. electronic transfers between fund and bank accounts;
. automatic investing and automatic exchange;
. brokerage services; and
. asset manager accounts.
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FUND PROFILE
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T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, MD 21202
www.troweprice.com
LOGO
RPS F15-035
T. Rowe Price Investment Services, Inc., Distributor
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