AETNA VARIABLE PORTFOLIOS, INC.
Supplement dated December 16, 1997 to the Prospectus dated May 1, 1997
The information in this Supplement updates and amends the information contained
in the Prospectus dated May 1, 1997 (the "Prospectus") and should be read with
that Prospectus.
Aetna Variable Portfolios, Inc. currently consists of eleven Portfolios, seven
of which are not currently offered to the public.
The section of the Prospectus entitled "MANAGEMENT OF THE VARIABLE PORTFOLIOS -
Portfolio Management - Growth and Capital Appreciation" found on page 10 is
hereby amended and supplemented as follows:
Growth
Peter B. Canoni, Managing Director, Aeltus, and Kenneth H. Bragdon, Vice
President, Aeltus, are the co-managers for Growth. Mr. Canoni has managed the
Portfolio since its inception in December 1996, with Mr. Bragdon's assistance.
Mr. Bragdon became co-manager in mid-1997. Mr. Canoni has been with the Aetna
organization since 1980 and has over 26 years of experience in the investment
business. Mr. Bragdon has been with Aetna since 1978 and has 27 years of
experience in the investment business.
Capital Appreciation
Peter B. Canoni, Managing Director, Aeltus, has been managing Capital
Appreciation since its inception in December 1996. Mr. Canoni has been with the
Aetna organization since 1980 and has over 26 years of experience in the
investment business.
X.AETNA-97-1 December 1997
<PAGE>
The information in the "Financial Highlights" section of the Prospectus
beginning on page 4 is replaced with the following:
FINANCIAL HIGHLIGHTS
The selected data presented below for the periods ended December 31, 1996 are
derived from the financial statements of the Portfolios, which statements have
been audited by KPMG Peat Marwick LLP, independent auditors. The selected data
presented below for the six months ended June 30, 1997 have been taken from the
records of the Portfolios which are unaudited.
<TABLE>
<CAPTION>
Capital Appreciation Growth Index Plus Small Company
-------------------- ------ ---------- -------------
Six-month Period Six-month Period from Six-month Period Six-month Period
period ended from Dec. period Dec. 13, period from Sept. period from
June 30, 13, 1996 ended June 1996 to ended June 16, 1996 ended June Dec. 27,
1997 to Dec. 30, 1997 Dec. 31, 30, 1997 to Dec. 30, 1997 1996 to
(unaudited) 31, 1996 (unaudited) 1996 (unaudited) 31, 1996 (unaudited) Dec. 31, 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value per share,
beginning of period $10.199 $10.000 $10.146 $10.000 $10.906 $10.000 $10.113 $10.000
------- ------- ------- ------- ------ ------- ------- -------
Income From
Investment Operations:
Net investment income 0.062 0.015 0.026 0.011 0.059 0.047 0.006 0.008
Net realized and unrealized
gain on investments 2.001 0.200 1.608 0.147 2.237 0.919 1.653 0.115
------- ------- ------- ------- ------ ------- ------- -------
Total from investment
operations 2.063 0.215 1.634 0.158 2.296 0.966 1.659 0.123
------- ------- ------- ------- ------ ------- ------- -------
Less Distributions:
Dividends from net
investment income -- (0.016) -- (0.012) -- (0.047) -- (0.010)
Distribution from net
realized gains on
investments -- -- -- -- -- (0.013) -- --
------- ------- ------- ------- ------ ------- ------- -------
Total distributions -- (0.016) -- (0.012) -- (0.060) -- (0.010)
------- ------- ------- ------- ------ ------- ------- -------
Net asset value per share,
end of period $12.262 $10.199 $11.780 $10.146 $13.202 $10.906 $11.772 $10.113
======= ======= ======= ======= ====== ======= ======= =======
Total Return* 20.22% 2.15% 16.10% 1.57% 21.05% 9.64% 16.41% 1.23%
Net assets, end of period
(000) $6,310 $5,202 $6,040 $5,175 $58,601 $19,410 $6,267 $5,158
Ratio of total expenses to
average net assets** 0.75% 0.67% 0.75% 0.67% 0.50% 0.50% 0.90% 0.55%
Ratio of net investment
income to average net 1.14% 2.73% 0.50% 1.99% 1.51% 1.89% 0.12% 5.96%
assets**
Portfolio turnover rate 64.95% -- 80.38% 1.97% 38.23% 5.18% 101.56 --
Average Commission rate
paid per share $0.0584 $0.0300 $0.0571 $0.0364 $ 0.0377 $0.0358 $0.0567 --
</TABLE>
* The Total Return percentage does not reflect any separate account charges
under VA contracts and VLI policies.
** Annualized for periods of less than one year.
Additional information about the performance of the Portfolios included in this
table is contained in the Fund's Annual and Semi-Annual Reports dated December
31, 1996 and June 30, 1997, respectively. The Reports are incorporated herein by
reference and are available, without charge, by writing to the Fund at the
address listed on the cover of this Prospectus or by calling 1-800-525-4225.
The date of the Prospectus has been changed to December 10, 1997.
X.AETNA-97-1 December 1997
<PAGE>
AETNA VARIABLE PORTFOLIOS, INC.
Supplement dated December 16, 1997 to the
Statement of Additional Information dated May 1, 1997
The information in this Supplement updates and amends the information contained
in the Statement of Additional Information dated May 1, 1997 (the "SAI") and
should be read with the SAI.
Aetna Variable Portfolios, Inc. currently consists of eleven Portfolios, seven
of which are not currently offered to the public.
Certain information in the section of the SAI entitled "DIRECTORS AND OFFICERS
OF THE FUND" beginning on page 14 is amended as follows:
DIRECTORS AND OFFICERS
The investments and administration of the Fund are under the supervision of the
Directors. The Directors and executive officers of the Fund and their principal
occupations for the past five years are listed below. Those Directors who are
"interested persons," as defined in the 1940 Act, are indicated by an
asterisk(*). All Directors and officers hold similar positions with other
investment companies in the same Fund Complex managed by Aetna Life Insurance
and Annuity Company (Aetna) as the investment adviser. The Fund Complex
presently consists of Aetna Series Fund, Inc., Aetna Variable Fund, Aetna Income
Shares, Aetna Variable Encore Fund, Aetna Investment Advisers Fund, Inc., Aetna
GET Fund (Series B and Series C), Aetna Generation Portfolios, Inc., Aetna
Variable Portfolios, Inc. and Portfolios Partners, Inc.
<TABLE>
<CAPTION>
- ---------------- ------------------ --------------------------------------------------------------------------------
Name Address Position(s) Held Principal Occupation During Past Five Years (and Positions held with
and Age with Registrant Affiliated Persons or Principal Underwriters of the Registrant)
- ---------------- ------------------ --------------------------------------------------------------------------------
<S> <C> <C>
J. Scott Fox* Director and Director, Managing Director, Chief Operating Officer, Chief Financial Officer,
242 Trumbull President Aeltus Investment Management, Inc., October 1997 to present; Vice President,
Street Aetna Retirement Services, Inc., April 1997 to present; Director and Senior Vice
Hartford, President, Aetna Retirement Holdings, Inc., April 1997 to present; Director and
Connecticut President, Aetna Life Assignment Company, September 1997 to present;
Age 42 Director and Senior Vice President, Aetna Life Insurance and Annuity Company,
March 1997 to present; Director, Managing Director, Chief Operating Officer,
Chief Financial Officer and Treasurer, Aeltus Investment Management, Inc., April
1994 to March 1997; Managing Director and Treasurer, Equitable Capital Management
Corp., March 1987 to September 1993; Director, Aeltus Capital, Inc., March 1996 to
July 1997; Managing Director, Chief Financial Officer, Aeltus Capital Inc., March
1996 to April 1997; Director, Aeltus Trust Company, Inc., May 1996 to July 1997;
Managing Director, Chief Operating Officer, Chief Financial Officer and Treasurer,
Aeltus Trust Company, Inc., May 1996 to April 1997; Director and President, Aetna
Investment Management (Bermuda) Holding, Ltd., May 1996 to October 1997.
- ---------------- ------------------ --------------------------------------------------------------------------------
Wayne F. Vice President Assistant Vice President, Aetna Life Insurance and Annuity Company, May 1991
Baltzer to present; Vice President, Aetna Investment Services, Inc., July 1993 to
242 Trumbull present.
Street
Hartford,
Connecticut
Age 54
- ---------------- ------------------ --------------------------------------------------------------------------------
Amy R. Doberman Secretary Counsel, Aetna Life Insurance and Annuity Company, December 1996 to present;
151 Farmington Attorney, Securities and Exchange Commission, March 1990 to November 1996.
Avenue
Hartford,
Connecticut
Age 35
- ---------------- ------------------ --------------------------------------------------------------------------------
Morton Ehrlich Director Chairman and Chief Executive Officer, Integrated Management Corp. (an
1000 Venetian entrepreneurial company) and Universal Research Technologies, 1992 to present.
Way
Miami, Florida
Age 62
- ---------------- ------------------ --------------------------------------------------------------------------------
Maria T. Director Manager/Attorney, Health Services, New York City Department of Mental Health,
Fighetti Mental Retardation and Alcohol Services, 1973 to present.
325 Piermont
Road
Closter, New
Jersey
Age 54
- ---------------- ------------------ --------------------------------------------------------------------------------
XSAI.AVPI-97 December 1997
<PAGE>
<CAPTION>
- ---------------- ------------------ --------------------------------------------------------------------------------
Name Address Position(s) Held Principal Occupation During Past Five Years (and Positions held with
and Age with Registrant Affiliated Persons or Principal Underwriters of the Registrant)
- ---------------- ------------------ --------------------------------------------------------------------------------
<S> <C> <C>
David L. Grove Director, Private Investor; Economic/Financial Consultant, December 1985 to present.
5 The Knoll Chairperson
Armonk, Contract
New York Committee
Age 79
- ---------------- ------------------ --------------------------------------------------------------------------------
John Y. Kim* Director Director, President, Chief Executive Officer, Chief Investment Officer, Aeltus
242 Trumbull Investment Management, Inc., December 1995 to present; Director, Aetna Life
Street Insurance and Annuity Company, February 1995 to present; Senior Vice
Hartford, President, Aetna Life Insurance and Annuity Company, September 1994 to
Connecticut present.
Age 37
- ---------------- ------------------ --------------------------------------------------------------------------------
Sidney Koch Director Financial Adviser, self-employed, January 1993 to present; Senior Adviser,
455 East 86th Daiwa Securities America, Inc., January 1992 to January 1993.
Street
New York, New
York
Age 62
- ---------------- ------------------ --------------------------------------------------------------------------------
Frank Litwin Vice President Managing Director, Aeltus Investment Management, Inc., August 1997 to present;
242 Trumbull Vice President, Fidelity Investments Institutional Services Company, April
Street 1992 to August 1997.
Hartford,
Connecticut
Age 48
- ---------------- ------------------ --------------------------------------------------------------------------------
Shaun P. Director Vice President/Senior Vice President, Aetna Life Insurance and Annuity
Mathews* Company, March 1991 to present; Vice President, Aetna Life Insurance Company,
151 Farmington 1991 to present; Director and Senior Vice President, Aetna Investment
Avenue Services, Inc., July 1993 to present; Director and Senior Vice President,
Hartford, Aetna Insurance Company of America, September 1992 to present.
Connecticut
Age 42
- ---------------- ------------------ --------------------------------------------------------------------------------
Corine T. Director Dean of the Barney School of Business, University of Hartford, (West Hartford,
Norgaard CT), August 1996 to present; Professor, Accounting and Dean of the School of
556 Wormwood Management, Binghamton University, (Binghamton, NY), August 1993 to August
Hill 1996; Professor, Accounting, University of Connecticut, (Storrs, CT),
Mansfield September 1969 to June 1993; Director, The Advest Group (holding company for
Center, brokerage firm) through September 1996.
Connecticut
Age 60
- ---------------- ------------------ --------------------------------------------------------------------------------
Richard G. Director, Trust and Private Banking Consultant, David Ross Palmer Consultants, July 1991
Scheide Chairperson to present.
11 Lily Street Audit Committee
Nantucket,
Massachusetts
Age 68
- ---------------- ------------------ --------------------------------------------------------------------------------
Stephanie A. Treasurer and Director Mutual Fund Accounting, Aeltus Investment Management, Inc., November
Taylor Chief Financial 1995 to present; Director Mutual Fund Accounting, Aetna Life Insurance and
242 Trumbull Officer Annuity Company, August 1994 to November 1995; Assistant Vice President,
Street Investors Bank & Trust, January 1993 to August 1994.
Hartford,
Connecticut
Age 44
- ---------------- ------------------ --------------------------------------------------------------------------------
</TABLE>
*Interested persons as defined in the Investment Company Act of 1940 (1940 Act).
The date of the SAI has been changed to December 10, 1997.
XSAI.AVPI-97 December 1997
