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Filed Pursuant to Rule 497(c)
Registration File No.: 333-17217
EQ Advisors Trust(SM)
PROSPECTUS DATED MAY 1, 2000
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1 EQ Advisors Trust
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This Prospectus describes the ten (10) Portfolios** offered by EQ Advisors Trust
and the Class IA or Class IB shares offered by the Trust on behalf of each
Portfolio that you can choose as investment alternatives. Each Portfolio has its
own investment objective and strategies that are designed to meet different
investment goals. This Prospectus contains information you should know before
investing. Please read this Prospectus carefully before investing and keep it
for future reference.
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INTERNATIONAL STOCK PORTFOLIO
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DOMESTIC PORTFOLIOS Alliance Global
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BT Equity 500 Index
Calvert Socially Responsible BALANCED/HYBRID PORTFOLIOS
MFS Emerging Growth Companies --------------------------------
MFS Research Alliance Conservative Investors
T. Rowe Price Equity Income Alliance Growth Investors
Warburg Pincus Small Company Value Mercury World Strategy*
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* Effective May 1, 2000, the name of the Merrill Lynch World Strategy
Portfolio was changed to the "Mercury World Strategy Portfolio."
** All of these Portfolios may not be available in your variable life or
annuity product. Please consult your product prospectus to see which
Portfolios are available under your contract.
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YOU SHOULD BE AWARE THAT THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED
OR DISAPPROVED OF THE INVESTMENT MERIT OF THESE PORTFOLIOS OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Version 15
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Overview
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2 Overview
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EQ ADVISORS TRUST
This Prospectus tells you about the ten (10) current Portfolios of EQ Advisors
Trust ("Trust") and the Class IA or Class IB shares offered by the Trust on
behalf of each Portfolio. The Trust is an open-end management investment
company. Each Portfolio is a separate series of the Trust with its own
investment objective, investment strategies and risks, which are described in
this Prospectus. Each of the current Portfolios of the Trust are diversified for
purposes of the Investment Company Act of 1940, as amended ("1940 Act").
The Trust's shares are currently sold only to insurance company separate
accounts in connection with variable life insurance contracts and variable
annuity certificates and contracts (the "Contract" or collectively, the
"Contracts") issued by The Equitable Life Assurance Society of the United States
("Equitable") and Equitable of Colorado, Inc. ("EOC") as well as insurance
companies that are not affiliated with Equitable or EOC ("non-affiliated
insurance companies") and to The Equitable Investment Plan for Employees,
Managers and Agents ("Equitable Plan"). The Prospectus is designed to help you
make informed decisions about the Portfolios that are available under your
Contract or under the Equitable Plan. You will find information about your
Contract and how it works in the accompanying prospectus for the Contracts if
you are a Contractholder or participant under a Contract.
Equitable currently serves as the Manager of the Trust. In such capacity,
Equitable currently has overall responsibility for the general management and
administration of the Trust.
Information about the Advisers for each Portfolio is contained in the
description concerning that Portfolio in the section entitled "About the
Investment Portfolios." The Manager has the ultimate responsibility to oversee
each of the Advisers and to recommend their hiring, termination and replacement.
Subject to approval by the Board of Trustees, the Manager has been granted
relief by the Securities and Exchange Commission ("SEC") ("Multi-Manager Order")
that enables the Manager without obtaining shareholder approval to: (i) select
new or additional Advisers for each of the Trust's Portfolios; (ii) enter into
new investment advisory agreements and materially modify existing investment
advisory agreements; and (iii) terminate and replace the Advisers.
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Table of contents
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3 Table of contents
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SUMMARY INFORMATION CONCERNING EQ
ADVISORS TRUST 4
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2
ABOUT THE INVESTMENT PORTFOLIOS 10
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DOMESTIC PORTFOLIOS 12
BT Equity 500 Index 12
Calvert Socially Responsible 14
MFS Emerging Growth Companies 16
MFS Research 18
T. Rowe Price Equity Income 20
Warburg Pincus Small Company Value 23
INTERNATIONAL STOCK PORTFOLIO 25
Alliance Global 25
BALANCED/HYBRID PORTFOLIOS 28
Alliance Conservative Investors 28
Alliance Growth Investors 32
Mercury World Strategy 35
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3
MORE INFORMATION ON PRINCIPAL RISKS 38
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4
MANAGEMENT OF THE TRUST 44
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The Trust 44
The Manager 44
Expense Limitation Agreement 46
The Advisers 47
The Administrator 47
The Transfer Agent 47
Brokerage Practices 47
Brokerage Transactions with Affiliates
48
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FUND DISTRIBUTION ARRANGEMENTS 49
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PURCHASE AND REDEMPTION 50
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HOW ASSETS ARE VALUED 51
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TAX INFORMATION 52
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FINANCIAL HIGHLIGHTS 53
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PRIOR PERFORMANCE OF EACH ADVISER 64
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1
Summary information concerning EQ Advisors Trust
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4 Summary information concerning EQ Advisors Trust
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The following chart highlights the ten (10) Portfolios described in this
Prospectus that you can choose as investment alternatives under your Contracts
offered by Equitable or EOC. The chart and accompanying information identify
each Portfolio's investment objective(s), principal investment strategies, and
principal risks. "More Information on Principal Risks", which more fully
describes each of the principal risks, is provided beginning on page 38.
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EQ ADVISORS TRUST DOMESTIC PORTFOLIOS
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PORTFOLIO INVESTMENT OBJECTIVE(S)
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BT EQUITY 500 INDEX Seeks to replicate as closely as possible (before deduction
of Portfolio expenses) the total return of the S&P 500 Index
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CALVERT SOCIALLY RESPONSIBLE Seeks long-term capital appreciation
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MFS EMERGING GROWTH COMPANIES Seeks to provide long-term capital growth
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MFS RESEARCH Seeks to provide long-term growth of capital and future
income
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T. ROWE PRICE EQUITY INCOME Seeks to provide substantial dividend income and also
capital appreciation by investing primarily in
dividend-paying common stocks of established companies
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WARBURG PINCUS SMALL COMPANY VALUE Seeks long-term capital appreciation
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5 Summary information concerning EQ Advisors Trust
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PRINCIPAL INVESTMENT STRATEGIES PRINCIPAL RISKS
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Common stocks of companies in the S&P 500 Index General investment, index-fund, and fixed income risks
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Common stocks of medium to large U.S. companies that General investment, growth investing, mid-cap company,
meet both investment and social criteria liquidity, and derivatives risks
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Equity securities of emerging growth companies with the General investment, small-cap and mid-cap company,
potential to become major enterprises or that are major foreign securities, and growth investing risks
enterprises whose rates of earnings growth are expected to
accelerate
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Common stock or securities convertible into common stock General investment, small-cap and mid-cap company,
of companies with better than average prospects for foreign securities, fixed income, and growth investing risks
long-term growth
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Dividend-paying common stocks of established companies General investment, value investing, foreign securities, and
fixed income risks
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Equity securities of U.S. small-cap companies General investment, small-cap and mid-cap company,
portfolio turnover, foreign securities, fixed income, and
value investing risks
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------------------------- EQ Advisors Trust
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6 Summary information concerning EQ Advisors Trust
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EQ ADVISORS TRUST INTERNATIONAL STOCK PORTFOLIO
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PORTFOLIO INVESTMENT OBJECTIVE(S)
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ALLIANCE GLOBAL Seeks long-term growth of capital
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7 Summary information concerning EQ Advisors Trust
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PRINCIPAL INVESTMENT STRATEGIES PRINCIPAL RISKS
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Equity securities of U.S. and established foreign companies General investment, foreign securities, liquidity, derivatives,
(including shares of other mutual funds investing in foreign securities lending, and fixed income risks
securities), debt securities, derivatives, and securities
lending
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------------------------- EQ Advisors Trust
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8 Summary information concerning EQ Advisors Trust
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EQ ADVISORS TRUST BALANCED/HYBRID PORTFOLIOS
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PORTFOLIO INVESTMENT OBJECTIVE(S)
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ALLIANCE CONSERVATIVE INVESTORS Seeks to achieve a high total return without, in the opinion
of the Adviser, undue risk to principal
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ALLIANCE GROWTH INVESTORS Seeks to achieve the highest total return consistent with
the Adviser's determination of reasonable risk
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MERCURY WORLD STRATEGY Seeks high total investment return by investing primarily in
a portfolio of equity and fixed income securities, including
convertible securities, of U.S. and foreign issuers
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9 Summary information concerning EQ Advisors Trust
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PRINCIPAL INVESTMENT STRATEGIES PRINCIPAL RISKS
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Investment grade debt securities and equity securities of General investment, asset allocation, fixed income,
U.S. and foreign issuers, derivatives, and securities lending derivatives, convertible securities, liquidity, leveraging,
securities lending, portfolio turnover, and foreign securities
risks
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Equity securities (including foreign stocks, preferred stocks, General investment, asset allocation, fixed income,
convertible securities, securities of small and medium-sized leveraging, derivatives, liquidity, convertible securities,
companies) and debt securities (including foreign debt small-cap and mid-cap company, securities lending, junk
securities and junk bonds), derivatives, and securities bond, portfolio turnover, and foreign securities risks
lending
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Equity and fixed income securities of U.S. and foreign General investment, foreign securities, fixed income,
companies derivatives, non-diversification, liquidity, and portfolio
turnover risks
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------------------------- EQ Advisors Trust
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2
About the investment portfolios
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10 About the investment portfolios
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This section of the Prospectus provides a more complete description of the
principal investment objectives, strategies, and risks of each of the
Portfolios. Of course, there can be no assurance that any Portfolio will achieve
its investment objective.
Please note that:
o A fuller description of each of the principal risks is included in the
section "More Information on Principal Risks," which follows the
description of each Portfolio in this section of the Prospectus.
o Additional information concerning each Portfolio's strategies, investments,
and risks can also be found in the Trust's Statement of Additional
Information.
GENERAL INVESTMENT RISKS
Each of the Portfolios is subject to the following risks:
ASSET CLASS RISK: The returns from the types of securities in which a Portfolio
invests may underperform returns from the various general securities markets or
different asset classes.
MARKET RISK: You could lose money over short periods due to fluctuation in a
Portfolio's share price in reaction to stock or bond market movements, and over
longer periods during extended market downturns.
SECURITY SELECTION RISK: There is the possibility that the specific securities
selected by a Portfolio's Adviser will underperform other funds in the same
asset class or benchmarks that are representative of the general performance of
the asset class.
The Trust's Portfolios are not insured by the FDIC or any other government
agency. Each Portfolio is not a deposit or other obligation of any financial
institution or bank and is not guaranteed. Each Portfolio is subject to
investment risks and possible loss of principal invested.
THE BENCHMARKS
The performance of each of the Trust's Portfolios as shown on the following
pages compares each Portfolio's performance to that of a broad-based securities
market index, an index of funds with similar investment objectives and/or a
blended index. Each of the Portfolios' annualized rates of return are net of:
(i) its investment management fees; and (ii) its other expenses. These rates are
not representative of the actual return you would receive under your Contract.
Broad-based securities indices are unmanaged and are not subject to fees and
expenses typically associated with managed investment company portfolios.
Broad-based securities indices are also not subject to contract and
insurance-related expenses and charges. Investments cannot be made directly in a
broad-based securities index. Comparisons with these benchmarks, therefore, are
of limited use. They are included because they are widely known and may help you
to understand the universe of securities from which each Portfolio is likely to
select its holdings.
THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD INDEX ("MSCI World") is an
arithmetic, market value-weighted average of the performance of over 1,300
securities listed on the stock exchanges of twenty foreign countries and the
United States.
THE RUSSELL 2000 INDEX ("Russell 2000") is an unmanaged index which tracks the
performance of 2,000 publicly-traded U.S. stocks. It is often used to indicate
the performance of smaller company stocks. It is compiled by the Frank Russell
Company.
THE RUSSELL 2000 VALUE INDEX ("Russell 2000 Value") is an unmanaged index which
measures the performance of those Russell 2000 companies with lower
price-to-book ratios and lower forecasted growth values. It is compiled by the
Frank Russell Company.
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11 About the investment portfolios
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SB WORLD (SALOMON BROTHERS NON-U.S.-DOLLAR WORLD GOVERNMENT BOND INDEX) This
index measures total-return performance of government bonds with a maturity of
one year or more in 12 countries other than the United States. The index weights
bonds based on market capitalization, so that large debt-issuing countries such
as Japan and Germany have larger representations than do smaller issuing
countries.
THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX ("S&P 500") is an
unmanaged weighted index containing common stocks of 500 industrial,
transportation, utility and financial companies, regarded as generally
representative of the larger capitalization portion of the United States stock
market. The S&P 500 returns reflect the reinvestment of dividends, if any, but
do not reflect fees, brokerage commissions or other expenses of investing.
THE LIPPER AVERAGES are contained in Lipper's survey of the performance of funds
underlying a large universe of variable life and annuity contracts, where
performance averages are based on net asset values which reflect the deduction
of investment management fees and direct operating expenses, and, for funds with
Rule 12b-1 plans, asset-based sales charges. This survey is published by Lipper
Analytical Services, Inc., a firm recognized for its reporting of performance of
actively managed funds. Performance data shown for the portfolios does not
reflect the deduction of any insurance-related expenses (which are assessed at
the contract-level).
"Blended" performance numbers (e.g., 50% S&P 400/50% Russell 2000 or 60% S&P
500/40% Lehman Gov't/Corp) assume a static mix of the two indices. We believe
that these indices reflect more closely the market sectors in which certain
Portfolios invest.
70% S&P 500 INDEX/30% LEHMAN GOV'T/CORP.
INDEX is made up of 70% of the S&P 500 Index, which is an unmanaged weighted
index containing common stocks of 500 industrial, transportation, utility and
financial companies, regarded as generally representative of the larger
capitalization portion of the United States stock market, and 30% of the Lehman
Government/Corporate Index, which represents an unmanaged group of securities
widely regarded by investors as representative of the bond market.
70% LEHMAN TREASURY/30% S&P 500 INDEX is made up of 70% of the Lehman Treasury
Bond Index, which represents an unmanaged group of securities consisting of
all currently offered public obligations of the U.S. Treasury intended for
distribution in the domestic market, and 30% of the S&P 500 Index, which is an
unmanaged weighted index containing common stocks of 500 industrial,
transportation, utility and financial companies, regarded as generally
representative of the larger capitalization portion of the United States stock
market.
MERCURY WORLD STRATEGY COMPOSITE MARKET BENCHMARK is made up of 36% of the S&P
500 Index, which is an unmanaged weighted index containing common stocks of 500
industrial, transportation, utility and financial companies, regarded as
generally representative of the larger capitalization portion of the United
States stock market; 24% of the MSCI EAFE Index, which is a market
capitalization weighted equity index composed of a sample of companies
representative of the market structure of Europe, Australasia and the Far East;
21% of the Salomon Brothers U.S. Treasury Bond 1 year; and 14% Salomon Brothers
World Government ex U.S., and 5% U.S. Treasury Bill.
-------------------- EQ Advisors Trust
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DOMESTIC PORTFOLIOS
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12 BT EQUITY 500 INDEX PORTFOLIO
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BT EQUITY 500 INDEX PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to replicate as closely as possible (before
deduction of Portfolio expenses) the total return of the S&P 500.
THE INVESTMENT STRATEGY
The Portfolio invests in equity securities of companies included in the S&P 500.
The Adviser seeks to match the risk and return characteristics of the S&P 500 by
investing in a statistically selected sample of the securities found in the S&P
500, using a process known as "optimization". This process selects stocks for
the Portfolio so that industry weightings, market capitalizations and
fundamental characteristics (price to book ratios, price to earnings ratios,
debt to asset ratios and dividend yields) closely match those of the securities
included in the S&P 500. This approach helps to increase the Portfolio's
liquidity and reduce costs. The securities held by the Portfolio are weighted to
make the Portfolio's total investment characteristics similar to those of the
S&P 500 as a whole.
The Adviser generally will seek to match the composition of the S&P 500 but
usually will not invest the Portfolio's stock portfolio to mirror the S&P 500
exactly. Because of the difficulty and cost of executing relatively small stock
transactions, the Portfolio may not always be invested in the less heavily
weighted S&P 500 stocks, and may at times have its portfolio weighted
differently than the S&P 500, particularly if the Portfolio has a low level of
assets. In addition, the Portfolio may omit or remove any S&P 500 stock from the
Portfolio if, following objective criteria, the Adviser judges the stock to be
insufficiently liquid or believes the merit of the investment has been
substantially impaired by extraordinary events or financial conditions.
For more information on the S&P 500, see the preceding section "The Benchmarks."
The Portfolio is not sponsored, endorsed, sold or promoted by Standard & Poor's
Corporation ("S&P") and S&P makes no guarantee as to the accuracy and/or
completeness of the S&P 500 or any data included therein.
Over time, the correlation between the performance of the Portfolio and the S&P
is expected to be 95% or higher before deduction of Portfolio expenses. The
Portfolio's ability to track the S&P 500 may be affected by, among others,
transaction costs, administration and other expenses incurred by the Portfolio,
changes in either the composition of the S&P 500 or the assets of the Portfolio,
and the timing and amount of Portfolio investor contributions and withdrawals,
if any. The Portfolio seeks securities to track the S&P 500, therefore, the
Adviser generally will not attempt to judge the merits of any particular
security as an investment.
The Portfolio may also invest up to 20% of its assets in short-term debt
securities and money market instruments to meet redemption requests or to
facilitate investment in the securities of the S&P 500. Securities index futures
contracts and related options, warrants and convertible securities may be used
for a number of reasons, including: to simulate full investment in the S&P 500
while retaining a cash balance for Portfolio management purposes; to facilitate
trading; to reduce transaction costs; or to seek higher investment returns when
a futures contract, option, warrant or convertible security is priced more
attractively than the underlying equity security or S&P 500. These instruments
are considered to be derivatives.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
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13 BT EQUITY 500 INDEX PORTFOLIO
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INDEX FUND RISK: The Portfolio is not actively managed and invests in securities
included in the index regardless of their investment merit. Therefore, the
Portfolio cannot modify its investment strategies to respond to changes in the
economy and may be particularly susceptible to a general decline in the U.S. or
global stock market segment relating to the index.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998 and
1999, the Portfolio's first two years of existence, and some of the risks of
investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total returns
for the Portfolio for one year and since inception. The table also compares the
Portfolio's performance to the returns of a broad based index. Both the bar
chart and table assume reinvestment of dividends and distributions. Past
performance is not an indication of future performance. The performance results
presented below do not reflect any insurance and Contract-related fees and
expenses, which would reduce the performance results. The Portfolio's inception
date was January 1, 1998.
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CALENDAR YEAR ANNUAL TOTAL RETURN
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[GRAPHIC OMITTED]
1998 25.14%
1999 20.30%
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Best quarter: Worst quarter:
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21.26% (1998 4th Quarter) (10.03)% (1998 3rd Quarter)
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AVERAGE ANNUAL TOTAL RETURNS
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SINCE
ONE YEAR INCEPTION
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BT Equity 500 Index Portfolio 20.30% 22.66%
S&P 500 Index* 21.03% 24.76%
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* For more information on this index, see the preceding section "The
Benchmarks."
WHO MANAGES THE PORTFOLIO
BANKERS TRUST COMPANY: ("Bankers Trust"), 130 Liberty Street (One Bankers Trust
Plaza), New York, New York 10006. Bankers Trust has been the Adviser to the
Portfolio since it commenced operations. Bankers Trust is a wholly-owned
subsidiary of Bankers Trust Corporation. Bankers Trust conducts a variety of
general banking and trust activities and is a major wholesale supplier of
financial services, including investment management to the international and
domestic institutional markets. In 1999, Bankers Trust Corporation finalized a
merger in which Bankers Trust Corporation was acquired by and became a
subsidiary of Deutsche Bank AG.
--------------------------- EQ Advisors Trust
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DOMESTIC PORTFOLIOS (CONTINUED)
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14 CALVERT SOCIALLY RESPONSIBLE PORTFOLIO
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CALVERT SOCIALLY RESPONSIBLE
PORTFOLIO
INVESTMENT OBJECTIVE: Seeks long-term capital appreciation
THE INVESTMENT STRATEGY
The portfolio invests primarily in common stocks of medium to large U.S.
companies that meet both investment and social criteria. Brown Capital (and
Calvert) use a tandem investment process to select potential investments for the
Portfolio. Brown Capital creates a universe of potential investments from which
it and Calvert will ultimately select portfolio securities. Once Brown Capital
identifies a potential investment, Calvert promptly socially screens each
potential investment to assure that it meets Calvert's social criteria. During
that process, Brown Capital continues to evaluate each potential investment
based on whether that investment will satisfy Brown Capital's investment
criteria. The criteria of both Brown Capital and Calvert must be satisfied
before a security will be purchased for the Portfolio.
For purposes of this Portfolio, companies having market capitalizations greater
than $1 billion are considered medium to large companies.
INVESTMENT CRITERIA: Brown Capital's investment process balances the growth
potential of investments with the price or value of the investment in order to
identify stocks that offer above average growth potential at reasonable prices.
Brown Capital evaluates each stock in terms of its growth potential, the return
on risk-free investments, and the specific risk features of the company to
determine the reasonable price for the stock.
The Portfolio may invest up to 15% of its net assets in illiquid securities,
which are securities that cannot be readily sold because there is no active
market for them.
The Portfolio may invest in derivative instruments, such as foreign currency
contracts (up to 5% of its total assets), options on securities and indices (up
to 5% of its total assets), and futures contracts (up to 5% of its net assets).
When market or financial conditions warrant, the Portfolio may invest a
substantial portion of its assets in short-term obligations for temporary or
defensive purposes. If such action is taken, it will detract from achievement of
the Portfolio's investment objective during such periods.
SOCIAL CRITERIA: Calvert analyzes investments from a social activist
perspective. Calvert's philosophy is that long-term rewards to investors will
come from those organizations whose products, services and methods enhance the
human condition and the traditional American values of individual initiative,
equity of opportunity and cooperative effort. These criteria represent standards
of behavior which few, if any, organizations totally satisfy. As a matter of
practice, evaluation of a particular organization in the context of these
criteria will involve subjective judgment by Calvert.
The Portfolio seeks to invest in companies that:
o deliver safe products and services in ways that sustain our natural
environment. For example, the Portfolio looks for companies that produce
energy from renewable resources, while avoiding consistent polluters;
o manage with participation throughout the organization in defining and
achieving objectives. For example, the Portfolio looks for companies that
offer employee stock ownership or profit-sharing plans;
o negotiate fairly with their workers, provide an environment supportive of
their wellness, do not discriminate on the basis of race, gender, religion,
age, disability, ethnic origin, or sexual orientation, do not consistently
violate regulations of the U.S. Equal Employment Opportunity Commission,
and provide opportunities for women, disadvantaged minorities, and others
for whom equal opportunities have often been denied. For example, the
Portfolio considers both unionized and non-union firms with good labor
relations; and
o foster awareness of a commitment to human goals, such as creativity,
productivity, self-respect and responsibility, within the organization and
the world, and continually recreates a context within which these goals can
be realized. For example, the Portfolio looks for companies with an above
average commitment to community affairs and charitable giving.
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15 CALVERT SOCIALLY RESPONSIBLE PORTFOLIO
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The Portfolio will not invest in companies that Calvert
determines to be significantly engaged in:
o production of or the manufacture of equipment to produce nuclear energy;
o business activities in support of repressive regimes;
o manufacture of weapon systems;
o manufacture of alcoholic beverages or tobacco products;
o operation of gambling casinos; or
o a pattern and practice of violating the rights of indigenous people. We
urge companies to end negative stereotypes of Native Americans and other
indigenous peoples. For example, the Portfolio objects to the unauthorized
use of names and images that portray Native Americans in a negative light,
and supports the promotion of positive portrayals of all individuals and
ethnic groups.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
GROWTH INVESTING RISK: As noted above, this Portfolio uses a growth oriented
approach to stock selection. The price of growth stocks may be more sensitive to
changes in current or expected earnings than the prices of other stocks. The
price of growth stocks is also subject to the risk that the stock price of one
or more companies will fall or will fail to appreciate as anticipated by the
Adviser, regardless of movements in the securities markets.
MID-CAP COMPANY RISK: The Portfolio's investments in mid-cap companies may be
subject to more abrupt or erratic movements in price than are those of larger,
more established companies because: the securities of such companies are less
well-known and may trade less frequently and in lower volume; such companies are
more likely to experience greater or more unexpected changes in their earnings
and growth prospects; and the products or technologies of such companies may be
at a relatively early stage of development or not fully tested.
LIQUIDITY RISK: Certain securities held by the Portfolio may be difficult (or
impossible) to sell at the time and at the price the seller would like which may
cause the Portfolio to lose money or be prevented from earning capital gains.
DERIVATIVES RISK: The Portfolio's investments in derivatives can significantly
increase the Portfolio's exposure to market risk or credit risk of the
counterparty. Derivatives also involve the risk of mispricing or improper
valuation and the risk that changes in value of the derivative may not correlate
perfectly with the relevant assets, rates and indices.
PORTFOLIO PERFORMANCE
The inception date for this Portfolio is August 30, 1999. Therefore, no prior
performance information is available.
WHO MANAGES THE PORTFOLIO
CALVERT ASSET MANAGEMENT COMPANY, INC. ("Calvert"), 4550 Montgomery Avenue,
Suite 1000N, Bethesda, Maryland 20814, a subsidiary of Calvert Group Ltd., which
is a subsidiary of Ameritas Acacia Mutual Holding Company. Calvert has been the
Adviser to the Portfolio since it commenced operations. It has been managing
mutual funds since 1976. Calvert is the investment adviser for over 25 mutual
fund portfolios, including the first and largest family of socially screened
funds. Calvert provides the social investment research and screening of the
Portfolio's investments. As of December 31, 1999, Calvert had $6.5 billion in
assets under management.
BROWN CAPITAL MANAGEMENT, INC. ("Brown Capital"), 1201 North Calvert Street,
Baltimore, Maryland 21201. Brown Capital initially identifies potential
investments for the Portfolio, which are then promptly screened by Calvert using
the Portfolio's social criteria.
EDDIE C. BROWN, founder and President of Brown Capital, heads the management
team for the Portfolio. He has over 24 years of investment management
experience, and has held positions with T. Rowe Price Associates, Inc. and
Irwing Management Company. Mr. Brown is a frequent panelist on "Wall Street Week
with Louis Rukeyser" and is a member of the Wall Street Week Hall of Fame.
----------------------- EQ Advisors Trust
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
16 MFS EMERGING GROWTH COMPANIES PORTFOLIO
- --------------------------------------------------------------------------------
MFS EMERGING GROWTH COMPANIES
PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to provide long-term capital growth.
THE INVESTMENT STRATEGY
The Portfolio invests, under normal market conditions, primarily (at least 65%
of its total assets) in common stocks and related securities, such as preferred
stock, convertible securities and depositary receipts of emerging growth
companies. Emerging growth companies that the Adviser believes are either:
o early in their life cycle but have the potential to become major
enterprises; or
o are major enterprises whose rates of earnings growth are expected to
accelerate because of special factors such as rejuvenated management, new
products, changes in customer demand or basic changes in the economic
environment.
For purposes of this Portfolio, emerging growth companies may be of any size and
the Adviser would expect these companies to have products, technologies,
management, markets and opportunities that will facilitate earnings growth over
time that is well above the growth rate of the overall economy and rate of
inflation. The Portfolio's investments may include securities traded in the
over-the-counter markets.
The Adviser uses a "bottom-up" investment style in managing the Portfolio. This
means the securities are selected based upon fundamental analysis (such as an
analysis of earnings, cash flows, competitive position and management's
abilities) performed by the Adviser.
In addition, up to 25% of the Portfolio's assets may be invested in foreign
securities, including those in emerging markets, or in cash and cash
equivalents.
When adverse market, financial or political conditions warrant, the Portfolio
may depart from its principal strategies for temporary or defensive purposes.
Such investment strategies are inconsistent with the Portfolio's investment
objectives and could result in the Portfolio not achieving its investment
objective.
The Portfolio may engage in active and frequent trading to achieve its principal
investment strategies. Frequent trading increases transaction costs, which could
detract from the Portfolio's performance.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
GROWTH INVESTING RISK: As noted above, this Portfolio uses a growth oriented
approach to stock selection. The price of growth stocks may be more sensitive to
changes in current or expected earnings than the prices of other stocks. The
price of growth stocks is also subject to the risk that the stock price of one
or more companies will fall or will fail to appreciate as anticipated by the
Adviser, regardless of movements in the securities market.
SMALL-CAP AND MID-CAP COMPANY RISK: The Portfolio's investments in small-cap and
mid-cap companies may be subject to more abrupt or erratic movements in price
than are those of larger, more established companies because: the securities of
such companies are less well-known and may trade less frequently and in lower
volume; such companies are more likely to experience greater or more unexpected
changes in their earnings and growth prospects; and the products or technologies
of such companies may be at a relatively early stage of development or not fully
tested.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In
<PAGE>
- ----------
17 MFS EMERGING GROWTH COMPANIES PORTFOLIO
- --------------------------------------------------------------------------------
addition, the value of foreign investments can be adversely affected by:
unfavorable currency exchange rates (relative to the U.S. dollar for
securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; adverse changes in foreign economic and tax policies; and foreign
government instability, war or other adverse political or economic actions.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998
and 1999, the Portfolio's first two years of operations, and some of the risks
of investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total
returns for the Portfolio for one year and since inception. The table also
compares the Portfolio's performance to the returns of a broad-based index.
Both the bar chart and table assume reinvestment of dividends and
distributions. Past performance is not an indication of future performance.
The performance results presented below do not reflect any insurance and
Contract-related fees and expenses, which would reduce the performance
results. The inception date for the Portfolio is May 1, 1997.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1998 34.57%
1999 73.62%
<S> <C>
Best quarter: Worst quarter:
- --------------------------------------------------------------------------------
53.01% (1999 4th Quarter) (12.69)% (1998 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
SINCE
ONE YEAR INCEPTION
- --------------------------------------------------------------------------------
<S> <C> <C>
MFS Emerging Growth Companies
Portfolio 73.62% 48.20%
- --------------------------------------------------------------------------------
Russell 2000 Index* 21.26% 16.99%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
WHO MANAGES THE PORTFOLIO
MASSACHUSETTS FINANCIAL SERVICES COMPANY ("MFS"), 500 Boylston Street, Boston,
MA 02116. MFS has been the Adviser to the Portfolio since it commenced
operations. MFS is America's oldest mutual fund organization. MFS and its
predecessor organizations have a history of money management dating from 1924
and the founding of the first mutual fund in the United States, Massachusetts
Investors Trust. MFS is a subsidiary of Sun Life of Canada (United States)
Financial Services Holdings Inc., which, in turn, is an indirect wholly-owned
subsidiary of Sun Life Assurance Company of Canada.
The Portfolio Managers are TONI Y. SHIMURA, a Senior Vice President of MFS, who
has been employed by MFS as a portfolio manager for the Portfolio since 1995 and
JOHN W. BALLEN, Chief Investment Officer and President of MFS, who provides
general oversight in the management of the Portfolio.
------------------------------ EQ Advisors Trust
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
18 MFS RESEARCH PORTFOLIO
- --------------------------------------------------------------------------------
MFS RESEARCH PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to provide long-term growth of capital and
future income.
THE INVESTMENT STRATEGY
The Portfolio invests, at least 80% of its total assets in equity securities,
such as common stocks, securities convertible into common stocks, preferred
stocks and depositary receipts of companies believed by the Adviser to have:
o favorable prospects for long-term growth;
o attractive valuations based on current and expected earnings or cash flow;
o dominant or growing market share; and
o superior management.
The Portfolio may invest in securities of companies of any size. The Portfolio's
investments may include securities traded on securities exchanges or in the
over-the-counter markets.
The Portfolio may invest up to 20% of its net assets in foreign equity
securities, including those of emerging markets. The Portfolio may invest in
foreign equity securities, through which it may have exposure to foreign
currencies.
When adverse market, financial or political conditions warrant, the Portfolio
may depart from its principal investment strategies for temporary or defensive
purposes. Such investment strategies are inconsistent with the Portfolio's
investment objectives and could result in the Portfolio not achieving its
investment objective.
The Portfolio may invest up to 10% of its assets in high yielding debt
securities rated below investment grade ("junk bonds").
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
GROWTH INVESTING RISK: As noted above, this Portfolio uses a growth oriented
approach to stock selection. The price of growth stocks may be more sensitive to
changes in current or expected earnings than the prices of other stocks. The
price of growth stocks is also subject to the risk that the stock price of one
or more companies will fall or will fail to appreciate as anticipated by the
Adviser, regardless of movements in the securities market.
SMALL-CAP AND MID-CAP COMPANY RISK: The Portfolio's investments in small-cap and
mid-cap companies may be subject to more abrupt or erratic movements in price
than are those of larger, more established companies because: the securities of
such companies are less well-known and may trade less frequently and in lower
volume; such companies are more likely to experience greater or more unexpected
changes in their earnings and growth prospects; and the products or technologies
of such companies may be at a relatively early stage of development or not fully
tested.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the Portfolio's
performance will be affected by changes in interest rates, the credit risk of
the issuer, the duration or maturity of the Portfolio's fixed income holdings,
and adverse market or economic conditions. When interest rates rise, the value
of the Portfolio's fixed income securities, particularly those with longer
durations or maturities, will go down. When interest rates fall, the reverse is
true. In addition, to the extent that the Portfolio invests in investment grade
securities which are rated BBB by S&P or an equivalent rating by any other
NRSRO, it will be exposed to greater risk than higher-rated obligations because
BBB rated investment grade securities are regarded as having only an adequate
capacity to pay principal and interest, are considered to lack outstanding
investment characteristics, and may be speculative. The risk that an issuer or
guarantor of a fixed income security or counterparty to the Portfolio's fixed
income transaction is unable to meets its financial obligations is particularly
significant for this Portfolio because this Portfolio invests a
<PAGE>
- ----------
19 MFS RESEARCH PORTFOLIO
- --------------------------------------------------------------------------------
portion of its assets in "junk bonds" (i.e., securities rated below investment
grade). Junk bonds are issued by companies with questionable credit strength
and, consequently, are considered to be speculative in nature and may be subject
to greater market fluctuations than investment grade fixed-income securities.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, the value of foreign investments can be adversely
affected by: unfavorable currency exchange rates (relative to the U.S. dollar
for securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; adverse changes in foreign economic and tax policies; and foreign
government instability, war or other adverse political or economic actions.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998 and
1999, the Portfolio's first two years of operations, and some of the risks of
investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total returns
for the Portfolio for one year and since inception. The table also compares the
Portfolio's performance to the returns of a broad-based index. Both the bar
chart and table assume reinvestment of dividends and distributions. Past
performance is not an indication of future performance. The performance results
presented below do not reflect any insurance and Contract-related fees and
expenses, which would reduce the performance results. The inception date for the
Portfolio is May 1, 1997.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1998 24.11%
1999 23.12%
<S> <C>
Best quarter: Worst quarter:
- --------------------------------------------------------------------------------
21.36% (1998 4th Quarter) (14.24)% (1998 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
SINCE
ONE YEAR INCEPTION
- --------------------------------------------------------------------------------
<S> <C> <C>
- --------------------------------------------------------------------------------
MFS Research Portfolio 23.12% 23.93%
- --------------------------------------------------------------------------------
S&P 500 Index* 21.03% 27.36%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
WHO MANAGES THE PORTFOLIO
MASSACHUSETTS FINANCIAL SERVICES COMPANY ("MFS"), 500 Boylston Street, Boston,
MA 02116. MFS has been the Adviser to the Portfolio since it commenced
operations. MFS is America's oldest mutual fund organization. MFS and its
predecessor organizations have a history of money management dating from 1924
and the founding of the first mutual fund in the United States, Massachusetts
Investors Trust. MFS is a subsidiary of Sun Life of Canada (United States)
Financial Services Holdings Inc., which, in turn, is an indirect wholly-owned
subsidiary of Sun Life Assurance Company of Canada.
A committee of investment research analysts selects portfolio securities for the
Portfolio. This committee includes investment analysts employed not only by MFS,
but also by MFS International (U.K.) Limited, a wholly owned subsidiary of MFS.
The committee allocates the Portfolio's assets among various industries.
Individual analysts then select what they view as the securities best suited to
achieve the Portfolio's investment objective within their assigned industry
responsibility.
------------------------- EQ Advisors Trust
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
20 T. ROWE PRICE EQUITY INCOME PORTFOLIO
- --------------------------------------------------------------------------------
T. ROWE PRICE EQUITY INCOME PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to provide substantial dividend income and also
capital appreciation by investing primarily in dividend-paying common stocks of
established companies.
THE INVESTMENT STRATEGY
The Portfolio invests primarily (at least 65%) in dividend-paying common stocks
of well established companies paying above-average dividends.
The Adviser bases its investment decisions on three premises: (1) over time,
dividend income can account for a significant portion of the Portfolio's return;
(2) dividends are a more stable and predictable source of return; and (3) prices
of stocks that pay a high current income tend to be less volatile than those
paying below average dividends.
The Adviser uses a "value" approach in choosing securities. The Adviser's
in-house research team seeks companies that appear to be undervalued by various
measures and may be temporarily out of favor, but have good prospects for
capital appreciation and dividend growth. It looks for common stocks of
companies that have:
o established operating histories;
o above-average dividend yields relative to the S&P 500;
o low price to earnings ratios relative to the S&P 500;
o sound balance sheets and other positive financial characteristics; and
o low stock price relative to the company's asset value, cash flow or
business franchises.
Equity income investing involves finding common stocks that pay dividend income.
As an example, utility company stocks often provide dividend income while a
shareholder waits for the stock price to move. Dividends can help reduce the
Portfolio's volatility during turbulent markets and help offset losses when
stock prices are falling.
The Portfolio may invest up to 25% of its total assets in foreign securities.
These securities include non-dollar-denominated securities traded outside the
United States and dollar-denominated securities of foreign issuers traded in the
U.S. such as American Depositary Receipts. The Portfolio may also purchase
preferred stocks, convertible securities, warrants, futures, options, U.S.
Government securities, high-quality money market securities, as well as
investment grade debt securities and high yielding debt securities ("junk
bonds").
When market or financial conditions warrant, the Portfolio may invest without
limitation in high quality money market securities, and United States Government
debt securities for temporary or defensive purposes. Such investment strategies
are inconsistent with the Portfolio's investment objectives and could result in
the Portfolio not achieving its investment objective.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. The Portfolio's emphasis on stocks
of established companies paying high dividends and its potential investments in
fixed income securities may limit its potential for appreciation in a broad
market advance. Such securities may also be hurt when interest rates rise
sharply. Also, a company may reduce or eliminate its dividend. Other principal
risks include:
<PAGE>
- ----------
21 T. ROWE PRICE EQUITY INCOME PORTFOLIO
- --------------------------------------------------------------------------------
VALUE INVESTING RISK: As noted above, the Portfolio uses a value-oriented
approach to stock selection. Value investing is subject to the risk that a value
stock's intrinsic value may never be fully recognized or realized by the market,
or its price may go down. There is also the risk that a stock judged to be
undervalued may actually be appropriately priced.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, the value of foreign investments can be adversely
affected by: unfavorable currency exchange rates (relative to the U.S. dollar
for securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; adverse changes in foreign economic and tax policies; and foreign
government instability, war or other adverse political or economic actions.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the Portfolio's
performance will be affected by changes in interest rates, the credit risk of
the issuer, the duration or maturity of the Portfolio's fixed income holdings,
and adverse market or economic conditions. When interest rates rise, the value
of the Portfolio's fixed income securities, particularly those with longer
durations or maturities, will go down. When interest rates fall, the reverse is
true. The risk that an issuer or guarantor of a fixed income security or
counterparty to the Portfolio's fixed income transaction is unable to meet its
financial obligations is particularly significant for this Portfolio because
this Portfolio may invest a portion of its assets in "junk bonds" (i.e.,
securities rated below investment grade). Junk bonds are issued by companies
with questionable credit strength and, consequently, are considered to be
speculative in nature and may be subject to greater market fluctuations than
investment grade fixed-income securities.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998 and
1999, the Portfolio's first two years of operations, and some of the risks of
investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total returns
for the Portfolio for one year and since inception. The table also compares the
Portfolio's performance to the returns of a broad-based index. Both the bar
chart and table assume reinvestment of dividends and distributions. Past
performance is not an indication of future performance. The performance results
presented below do not reflect any insurance and Contract-related fees and
expenses,which would reduce the perfomance results. The inception date for the
Portfolio is May 1, 1997.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1998 9.11%
1999 3.54%
<S> <C>
Best quarter: Worst quarter:
- --------------------------------------------------------------------------------
13.29% (1999 2nd Quarter) (8.56)% (1999 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
SINCE
ONE YEAR INCEPTION
- --------------------------------------------------------------------------------
<S> <C> <C>
- --------------------------------------------------------------------------------
T. Rowe Price Equity Income Portfolio 3.54% 12.80%
- --------------------------------------------------------------------------------
S&P 500 Index* 21.03% 27.36%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
WHO MANAGES THE PORTFOLIO
T. ROWE PRICE ASSOCIATES, INC. ("T. Rowe Price"), 100 East Pratt Street,
Baltimore, MD 21202. T. Rowe Price has
-------------------------- EQ Advisors Trust
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
22 T. ROWE PRICE EQUITY INCOME PORTFOLIO
- --------------------------------------------------------------------------------
been the Adviser to the Portfolio since the Portfolio commenced operations. T.
Rowe Price serves as investment manager to a variety of individual and
institutional investor accounts, including limited partnerships and other mutual
funds.
Investment decisions with respect to the Portfolio are made by an Investment
Advisory Committee. BRIAN C. ROGERS has been the Committee Chairman since the
inception of the Portfolio and has day-to-day responsibility for managing the
Portfolio and works with the Committee in developing and executing the
Portfolio's investment program. Mr. Rogers joined T. Rowe Price in 1982 and has
been managing investments since 1983.
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
23 WARBURG PINCUS SMALL COMPANY VALUE PORTFOLIO
- --------------------------------------------------------------------------------
WARBURG PINCUS SMALL COMPANY VALUE PORTFOLIO
INVESTMENT OBJECTIVE: Seeks long-term capital appreciation.
THE INVESTMENT STRATEGY
The Portfolio invests primarily in equity securities of U.S. small-cap companies
with above-average growth potential that the Adviser believes to be undervalued.
Typically, such investments may include common stocks, preferred stocks,
convertible securities, warrants and rights of small-cap companies. Once 65% of
the Portfolio's assets are invested in small-cap companies, the Portfolio may
also invest in companies with a market capitalization of any size.
For purposes of this Portfolio, small-cap companies are companies having market
capitalizations within the range of capitalizations of companies represented in
the Russell 2000 Index.
In determining whether a company's stock is undervalued, the Adviser considers
all relevant factors which may include a company's:
o price/earnings ratio;
o price to book value ratio;
o price to cash flow ratio; and
o debt to capital ratio.
The Portfolio will invest primarily (at least 65% of its net assets) in the
securities of U.S. companies traded in the U.S. securities markets. The
Portfolio may invest to a lesser extent in foreign securities, investment grade
debt securities and high quality domestic and foreign short-term (one year or
less) and medium-term money-market securities.
When market or financial conditions warrant, the Portfolio may invest without
limitation in investment grade debt obligations and in domestic and foreign
obligations, including repurchase agreements for temporary or defensive
purposes. Such investment strategies are inconsistent with the Portfolio's
investment objectives and could result in the Portfolio not achieving its
investment objective.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up
or down depending on general market conditions. Other principal risks include:
VALUE INVESTING RISK: As noted above, the Portfolio uses a value-oriented
approach to stock selection. Value investing is subject to the risk that a value
stock's intrinsic value may never be fully recognized or realized by the market,
or its price may go down. There is also the risk that a stock judged to be
undervalued may actually be appropriately priced.
SMALL-CAP AND MID-CAP COMPANY RISK: The Portfolio's investments in small-cap and
mid-cap companies may be subject to more abrupt or erratic movements in price
than are those of larger, more established companies because: the securities of
such companies are less well-known and may trade less frequently and in lower
volume; such companies are more likely to experience greater or more unexpected
changes in their earnings and growth prospects; and the products or technologies
of such companies may be at a relatively early stage of development or not fully
tested.
PORTFOLIO TURNOVER RISK: The Portfolio's turnover rate has been over 100% per
year. Higher portfolio turnover (e.g., over 100% per year) will cause the
Portfolio to incur additional transaction costs that could be passed through to
shareholders.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, the value of foreign investments can be adversely
----------------------- EQ Advisors Trust
<PAGE>
DOMESTIC PORTFOLIOS (CONTINUED)
- ----------
24 WARBURG PINCUS SMALL COMPANY VALUE PORTFOLIO
- --------------------------------------------------------------------------------
affected by: unfavorable currency exchange rates (relative to the U.S. dollar
for securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; adverse changes in foreign economic and tax policies; and foreign
government instability, war or other adverse political or economic actions.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the Portfolio's
performance will be affected by changes in interest rates, the credit risk of
the issuer, the duration or maturity of the Portfolio's fixed income holdings,
and adverse market or economic conditions. When interest rates rise, the value
of the Portfolio's fixed income securities, particularly those with longer
durations or maturities, will go down. When interest rates fall, the reverse is
true. In addition, to the extent that the Portfolio invests in investment grade
securities, which are rated BBB by S&P or an equivalent rating by any other
NRSRO, it will be exposed to greater risk than higher-rated obligations because
BBB rated investment grade securities are regarded as having only an adequate
capacity to pay principal and interest, are considered to lack outstanding
investment characteristics, and may be speculative.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998
and 1999, the Portfolio's first two years of operations, and some of the risks
of investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total
returns for the Portfolio for one year and since inception. The table also
compares the Portfolio's performance to the returns of a broad-based index.
Both the bar chart and table assume reinvestment of dividends and
distributions. Past performance is not an indication of future performance.
The performance results presented below do not reflect any insurance and
Contract-related fees and expenses, which would reduce performance results.
The inception date for the Portfolio is May 1, 1997.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1998 -10.02%
1999 1.80%
<S> <C>
Best quarter: Worst quarter:
- --------------------------------------------------------------------------------
12.40% (1999 4th Quarter) (20.25)% (1998 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
SINCE
ONE YEAR INCEPTION
- --------------------------------------------------------------------------------
<S> <C> <C>
Warburg Pincus Small Company Value
Portfolio 1.80% 3.33%
- --------------------------------------------------------------------------------
Russell 2000 Value Index*, ** (1.49)% 7.06%
- --------------------------------------------------------------------------------
Russell 2000 Index* 21.26% 16.99%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
** We believe that this index reflects more closely the market sectors in which
the Portfolio invests.
WHO MANAGES THE PORTFOLIO
CREDIT SUISSE ASSET MANAGEMENT, LLC. ("CSAM"), 466 Lexington Avenue, New York,
New York 10017-3147. CSAM is the successor to Warburg Pincus Asset Management,
Inc., which served as the Adviser to the Portfolio since it commenced
operations. CSAM is a professional investment advisory firm that provides
investment services to investment companies, employee benefit plans, endowment
funds, foundations and other institutions and individuals. CSAM is indirectly
controlled by Credit Suisse Group. CSAM manages over $60 billion in assets in
the U.S., and together with its global affiliates, over $168 billion worldwide.
KYLE F. FREY is the Portfolio Manager and has been responsible for the
day-to-day management of the Portfolio since the Portfolio commenced operations.
Mr. Frey is a managing director of CSAM and has been with CSAM or its
predecessor since 1989.
<PAGE>
INTERNATIONAL STOCK PORTFOLIO
- ----------
25 ALLIANCE GLOBAL PORTFOLIO
- --------------------------------------------------------------------------------
ALLIANCE GLOBAL PORTFOLIO
INVESTMENT OBJECTIVE: Seeks long-term growth of
capital.
THE INVESTMENT STRATEGY
The Portfolio invests primarily in a diversified mix of equity securities of
U.S. and established foreign companies. The Adviser believes the equity
securities of these established non-U.S. companies have prospects for growth.
The Portfolio intends to make investments in several countries and to have
represented in the Portfolio business activities in not less than three
different countries (including the United States).
These non-U.S. companies may have operations in the United States, in their
country of incorporation or in other countries.
The Portfolio may invest in any type of security including, but not limited to,
common and preferred stock, as well as shares of mutual funds that invest in
foreign securities, bonds and other evidences of indebtedness, and other
securities of issuers wherever organized and governments and their political
subdivisions. Although no particular proportion of stocks, bonds or other
securities is required to be maintained, the Portfolio intends under normal
conditions to invest in equity securities.
The Portfolio may also make use of various other investment strategies,
including making secured loans of up to 50% of its total assets. The Portfolio
may also use derivatives including: writing covered call and put options,
purchasing call and put options on individual equity securities, securities
indexes, and foreign currencies. The Portfolio may also purchase and sell stock
index, foreign currency and interest rate futures contracts and options on such
contracts, as well as forward foreign currency exchange contracts.
When market or financial conditions warrant, the Portfolio may at times invest
substantially all of its assets in securities issued by U.S. companies or in
cash or cash equivalents, including money market instruments issued by foreign
entities for temporary or defensive purposes. Such investment strategies could
result in the Portfolio not achieving its investment objective.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
FOREIGN SECURITIES RISK: Investing in foreign securities involves risks not
associated with investing in U.S. securities that can adversely affect the
Portfolio's performance. Foreign markets, particularly emerging markets, may be
less liquid, more volatile and subject to less government supervision than
domestic markets. There may be difficulties enforcing contractual obligations,
and it may take more time for trades to clear and settle. In addition, foreign
investments can be adversely affected by: unfavorable currency exchange rates
(relative to the U.S. dollar for securities denominated in a foreign
currencies); inadequate or inaccurate information about foreign companies;
higher transaction, brokerage and custody costs; expropriation or
nationalization; adverse changes in foreign economic and tax policies; and
foreign government instability, war or other adverse political or economic
actions. Other specific risks of investing in foreign securities include:
EMERGING MARKET RISK: There are greater risks involved in investing in
emerging markets countries and/or their securities markets, such as less
diverse and less mature economic structures, less stable political systems,
more restrictive foreign investment policies, smaller-sized securities
markets and low trading volumes. Such risks can make investments illiquid
and more volatile than investments in developed countries and such
securities may be subject to abrupt and severe price declines.
EURO RISK: The Portfolio may invest in securities issued by European
issuers. On January 1, 1999, 11 of the 15 member states of the European
Monetary Union ("EMU") introduced the "Euro" as a common currency.
---------------------------- EQ Advisors Trust
<PAGE>
INTERNATIONAL STOCK PORTFOLIO (CONTINUED)
- ----------
26 ALLIANCE GLOBAL PORTFOLIO
- --------------------------------------------------------------------------------
During a three-year transitional period, the Euro will coexist with each
participating state's currency and, on July 1, 2002, the Euro is expected
to become the sole currency of the participating states. The introduction
of the Euro will result in the redenomination of European debt and equity
securities over a period of time, which may result in various legal and
accounting differences and/or tax treatments that otherwise would not
likely occur. During this period, the creation and implementation of
suitable clearing and settlement systems and other operational problems may
cause market disruptions that could adversely affect investments quoted in
the Euro.
REGULATORY RISK: In general, foreign companies are also not subject to
uniform accounting, auditing and financial reporting standards or to other
regulatory practices and requirements as are U.S. companies, which could
adversely affect their value.
LIQUIDITY RISK: Certain securities held by the Portfolio may be difficult (or
impossible) to sell at the time and at the price the seller would like which may
cause the Portfolio to lose money or be prevented from earning capital gains.
DERIVATIVES RISK: The Portfolio's investments in derivatives can significantly
increase the Portfolio's exposure to market risk or credit risk of the
counterparty. Derivatives also involve the risk of mispricing or improper
valuation and the risk that changes in value of the derivative may not correlate
perfectly with the relevant assets, rates and indices.
LEVERAGING RISK: When the Portfolio borrows money or otherwise leverages its
portfolio, the value of an investment in the Portfolio will be more volatile and
all other risk will tend to be compounded.
SECURITIES LENDING RISK: This Portfolio may make secured loans of its portfolio
securities. The risks in lending portfolio securities, as with other extensions
of secured credit, consist of possible delay in receiving additional collateral,
or in the recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the Portfolio's
performance will be affected by changes in interest rates, the credit risk of
the issuer, the duration or maturity of the Portfolio's fixed income holdings,
and adverse market or economic conditions. When interest rates rise, the value
of the Portfolio's fixed income securities, particularly those with longer
durations or maturities, will go down. When interest rates fall, the reverse is
true. In addition, to the extent that the Portfolio invests in investment-grade
securities which are rated BBB by S&P or an equivalent rating by any other
NRSRO, it will be exposed to greater risk than if it invested in higher-rated
obligations because BBB-rated securities are regarded as having only an adequate
capacity to pay principal and interest, are considered to lack outstanding
investment characteristics, and may be speculative.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total returns for each of
the last ten calendar years and some of the risks of investing in the Portfolio
by showing yearly changes in the Portfolio's performance. The table below shows
the Portfolio's average annual total returns for the past one, five and ten
years and compares the Portfolio's performance to: (i) the returns of a
broad-based index and (ii) the returns of an index of funds with similar
investment objectives. Past performance is not an indication of future
performance.
The Portfolio's performance shown below is principally the performance of its
predecessor registered investment company (HRT/Alliance Global Portfolio)
managed by the Adviser using the same investment objectives and strategy as the
Portfolio. For these purposes, the Portfolio is considered to be the successor
entity to the predecessor registered investment company (HRT/Alliance Global
Portfolio) whose inception date is August 27, 1987. The assets of the
<PAGE>
- ----------
27 ALLIANCE GLOBAL PORTFOLIO
- --------------------------------------------------------------------------------
predecessor were transferred to the Portfolio on October 18, 1999. Following
that transfer, the performance shown (for the period October 19, 1999 through
December 31, 1999) is that of the Portfolio. For these purposes, the performance
results of the Portfolio and its predecessor registered investment company have
been linked.
Both the bar chart and table assume reinvestment of dividends and distributions.
The performance results do not reflect any insurance and Contract-related fees
and expenses, which would reduce the performance results.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
- --------------------------------------------------------------------------------
1990 -6.15%
- --------------------------------------------------------------------------------
1991 30.5%
- --------------------------------------------------------------------------------
1992 -0.5%
- --------------------------------------------------------------------------------
1993 32.1%
- --------------------------------------------------------------------------------
1994 5.2%
- --------------------------------------------------------------------------------
1995 18.8%
- --------------------------------------------------------------------------------
1996 14.6%
- --------------------------------------------------------------------------------
1997 11.7%
- --------------------------------------------------------------------------------
1998 21.8%
- --------------------------------------------------------------------------------
1999 38.53%
- --------------------------------------------------------------------------------
<S> <C>
Best quarter (% and time period) Worst quarter (% and time period)
- --------------------------------------------------------------------------------
26.59% (1998 4th Quarter) (16.99)% (1998 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
ONE YEAR FIVE YEARS TEN YEARS
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Alliance Global
Portfolio -
Class IA Shares 38.53% 20.74% 15.84%
- --------------------------------------------------------------------------------
Lipper Global
Mutual Funds
Average* 44.18% 19.42% 11.73%
- --------------------------------------------------------------------------------
MSCI World
Index* 24.93% 19.76% 11.42%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
WHO MANAGES THE PORTFOLIO
ALLIANCE CAPITAL MANAGEMENT, L.P. ("Alliance"), 1345 Avenue of the Americas, New
York, New York 10105. Alliance has been the Adviser to the Portfolio and its
predecessor registered investment company since the predecessor commenced
operations. Alliance, a publicly traded limited partnership, is indirectly
majority-owned by Equitable. Alliance manages investment companies, endowment
funds, insurance companies, foreign entities, qualified and non-tax qualified
corporate funds, public and private pension and profit-sharing plans,
foundations and tax-exempt organizations.
SANDRA L. YEAGER has been responsible for the day-to-day management of the
Portfolio's and its predecessor's investment program since 1998. Ms. Yeager, a
Senior Vice President of Alliance, has been associated with Alliance since 1990.
---------------------- EQ Advisors Trust
<PAGE>
BALANCED/HYBRID PORTFOLIO
- ----------
28 ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to achieve a high total return without, in the
opinion of the Adviser, undue risk to principal.
THE INVESTMENT STRATEGY
The Portfolio invests varying portions of its assets in high quality,
publicly-traded fixed income securities (including money market instruments and
cash) and publicly-traded common stocks and other equity securities of U.S. and
non-U.S. issuers.
The Portfolio will at all times hold at least 40% of its assets in investment
grade fixed income securities, each having a duration, as determined by the
Adviser, that is less than that of a 10-year Treasury bond (the "fixed income
core"). The Portfolio is generally expected to hold approximately 70% of its
assets in fixed income securities (including the fixed income core) and 30% in
equity securities. Actual asset mixes will be adjusted in response to economic
and credit market cycles. The fixed income asset class will always comprise at
least 50%, but never more than 90%, of the Portfolio's total assets. The equity
class will always comprise at least 10%, but never more than 50%, of the
Portfolio's total assets.
Duration is a measure of the weighted average maturity of the bonds held by the
Portfolio and can be used by the Adviser as a measure of the sensitivity of the
market value of the Portfolio to changes in interest rates. Generally, the
longer the duration of the Portfolio, the more sensitive its market value will
be to changes in interest rates.
In some cases, the Adviser's calculation of duration will be based on certain
assumptions (including assumptions regarding prepayment rates, in the
mortgage-backed or asset-backed securities, and foreign and domestic interest
rates). As of December 31, 1999, the Adviser considered the duration of a
10-year Treasury bond to be 7.3 years. The Portfolio's investments will
generally have a final maturity of not more than ten years or a duration not
exceeding that of a 10-year Treasury note.
All debt securities held by the Portfolio will be of investment grade (i.e.,
rated at least BBB by S&P or Baa by Moody's) or unrated securities of comparable
quality as determined by the Adviser. The equity securities invested in by the
Portfolio will consist primarily of common stocks (including convertible
securities). The Portfolio may also invest in stocks that are traded
over-the-counter and in other equity-type securities. No more than 15% of the
Portfolio's assets will be invested in securities of non-U.S. issuers.
The Portfolio may also make use of various other investment strategies and
derivatives. Up to 50% of its total assets may be used for securities lending
purposes.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
ASSET ALLOCATION RISK: In addition to the risks associated with the securities
in which the Portfolio invests, the Portfolio is subject to the risk that the
Adviser's allocation of the Portfolio's assets between debt and equity
securities may adversely affect the Portfolio's value.
FIXED INCOME RISK: This Portfolio invests primarily in fixed income securities,
therefore, the Portfolio's performance will be affected by changes in interest
rates, credit risks of the issuer, the duration and maturity of the Portfolio's
fixed
<PAGE>
- ----------
29 ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
income holdings, and adverse market and economic conditions. Other risks that
relate to the Portfolio's investment in fixed income securities include:
INTEREST RATE RISK: When interest rates rise, the value (i.e., share
price and total return) of the Portfolio's fixed income securities,
particularly those with longer durations or maturities, will go down. When
interest rates fall, the reverse is true.
INVESTMENT GRADE SECURITIES RISK: The Portfolio could lose money if
the issuer or guarantor of a debt security or counterparty to a Portfolio's
transaction is unable or unwilling to make timely principal and/or interest
payments, or to honor its financial obligations. Investment grade
securities which are rated BBB by S&P or an equivalent rating by any other
NRSRO, are somewhat riskier than higher rated obligations because they are
regarded as having only an adequate capacity to pay principal and interest,
are considered to lack outstanding investment characteristics, and may be
speculative.
MORTGAGE BACKED SECURITIES RISK: Rising interest rates may cause the
duration of mortgage-backed securities to increase, making them even more
susceptible to interest rate changes. Falling interest rates may cause the
value and yield of mortgage-backed securities to fall. Falling interest
rates also may encourage borrowers to pay off their mortgages sooner than
anticipated (pre-payment). The Portfolio would need to reinvest the
pre-paid funds at the newer, lower interest rates.
CONVERTIBLE SECURITIES RISK: Convertible securities generally enable the
Portfolio to benefit from increases in the market price of the underlying common
stock and provide higher yields than the underlying common stocks, but generally
offer lower yields than nonconvertible securities of similar quality. The value
of convertible securities fluctuates both in relation to changes in interest
rates and changes in the value of the underlying common stock.
SECURITIES LENDING RISK: This Portfolio may make secured loans of its portfolio
securities. The risks in lending portfolio securities, as with other extensions
of secured credit, consist of possible delay in receiving additional collateral,
or in the recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially.
DERIVATIVES RISK: The Portfolio's investments in derivatives can significantly
increase the Portfolio's exposure to market risk or credit risk of the
counterparty. Derivatives also involve the risk of mispricing or improper
valuation and the risk that changes in value of the derivative may not correlate
perfectly with the relevant assets, rates and indices.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, the value of foreign investments can be adversely
affected by: unfavorable currency exchange rates (relative to the U.S. dollar
for securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; expropriation or nationalization; adverse changes in foreign economic and
tax policies; and foreign government instability, war or other adverse political
or economic actions.
LIQUIDITY RISK: Certain securities held by the Portfolio may be difficult (or
impossible) to sell at the time and at the price the seller would like, which
may cause the Portfolio to lose money or be prevented from earning capital
gains.
---------------------------- EQ Advisors Trust
<PAGE>
BALANCED/HYBRID PORTFOLIO (CONTINUED)
- ----------
30 ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
PORTFOLIO TURNOVER RISK: The Portfolio's turnover rate was over 100% per year.
Higher portfolio turnover (e.g., over 100% per year) will cause the Portfolio to
incur additional transaction costs that could be passed through to shareholders.
LEVERAGING RISK: When the Portfolio borrows money or otherwise leverages its
portfolio, the value of an investment in the Portfolio will be more volatile and
all other risk will tend to be compounded.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total returns for each of
the last ten calendar years and some of the risks of investing in the Portfolio
by showing yearly changes in the Portfolio's performance. The table below shows
the Portfolio's average annual total returns for the past one year, five years
and since inception and compares the Portfolio's performance to: (i) the returns
of a broad-based index; (ii) the returns of a "blended" index of fixed income
and equity securities; and (iii) the returns of an index of funds with similar
investment objectives. Past performance is not an indication of future
performance.
The Portfolio's performance shown below is principally the performance of its
predecessor registered investment company (HRT/Alliance Conservative Investors
Portfolio) managed by the Adviser using the same investment objectives and
strategy as the Portfolio. For these purposes, the Portfolio is considered to be
the successor entity to the predecessor registered investment company
(HRT/Alliance Conservative Investors Portfolio) whose inception date is October
2, 1989. The assets of the predecessor were transferred to the Portfolio on
October 18, 1999. Following that transfer, the performance shown (for the period
October 19, 1999 through December 31, 1999) is that of the Portfolio. For these
purposes, the performance results of the Portfolio and its predecessor
registered investment company have been linked.
Both the bar chart and table assume reinvestment of dividends and distributions.
The performance results do not reflect any insurance and Contract-related fees
and expenses, which would reduce the performance results.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1990 6.3%
- --------------------------------------------------------------------------------
1991 19.8%
- --------------------------------------------------------------------------------
1992 5.6%
- --------------------------------------------------------------------------------
1993 10.8%
- --------------------------------------------------------------------------------
1994 -4.1%
- --------------------------------------------------------------------------------
1995 20.4%
- --------------------------------------------------------------------------------
1996 5.2%
- --------------------------------------------------------------------------------
1997 13.3%
- --------------------------------------------------------------------------------
1998 13.9%
- --------------------------------------------------------------------------------
1999 9.87%
- --------------------------------------------------------------------------------
<S> <C>
Best quarter (% and time period) Worst quarter (% and time period)
- ----------------------------------- ----------------------------------
7.65% (1998 4th Quarter) (2.05)% (1994 1st Quarter)
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
ONE YEAR FIVE YEARS TEN YEARS
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Alliance Conservative
Investors Portfolio -
Class IA Shares 10.14% 12.47% 9.94%
- --------------------------------------------------------------------------------
70% Lehman Treasury/30%
S&P 500 Index*,** 4.19% 13.60% 10.75%
- --------------------------------------------------------------------------------
S&P 500* 21.03% 28.56% 18.21%
- --------------------------------------------------------------------------------
Lipper Income Average* 4.65% 14.57% 10.84%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
** We believe that this index reflects more closely the market sectors in which
the Portfolio invests.
WHO MANAGES THE PORTFOLIO
ALLIANCE CAPITAL MANAGEMENT, L.P. ("Alliance"), 1345 Avenue of the Americas, New
York, New York 10105. Alliance has been the Adviser to the Portfolio and its
predecessor registered investment company since the predecessor commenced
operations. Alliance, a publicly traded limited partnership, is indirectly
majority-owned by Equitable. Alliance manages investment companies, endowment
funds, insurance companies, foreign entities, qualified and non-tax qualified
corporate funds, public and private pension and profit-sharing plans,
foundations and tax-exempt organizations.
ROBERT G. HEISTERBERG has been responsible for the day-to-day management of the
Portfolio and its predecessor
<PAGE>
- ----------
31 Alliance Conservative Investors Portfolio
- --------------------------------------------------------------------------------
since February 12, 1996. Mr. Heisterberg, a Senior Vice President of Alliance
and Global Economic Policy Analysis, has been associated with Alliance since
1977.
------------------------ EQ Advisors Trust
<PAGE>
BALANCED/HYBRID PORTFOLIO (CONTINUED)
- ----------
32 ALLIANCE GROWTH INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
ALLIANCE GROWTH INVESTORS PORTFOLIO
INVESTMENT OBJECTIVE: Seeks to achieve the highest total return consistent
with the Adviser's determination of reasonable risk.
THE INVESTMENT STRATEGY
The Portfolio allocates varying portions of its assets to a number of asset
classes. The fixed income asset class will always comprise at least 10%, but
never more than 60%, of the Portfolio's total assets. The equity class will
always comprise at least 40%, but never more than 90%, of the Portfolio's
total assets. Over time, the Portfolio's holdings, on average, are expected to
be allocated 70% to equity securities and 30% to debt securities. Actual asset
mixes will be adjusted in response to economic and credit market cycles.
The Portfolio's investments in equity securities will include both
exchange-traded and over-the counter common stocks and other equity
securities, including foreign stocks, preferred stocks, convertible debt
instruments, as well as securities issued by small-and mid-sized companies
that have favorable growth prospects.
The Portfolio's debt securities may include foreign debt securities,
investment grade fixed income securities (including cash and money market
instruments) as well as lower quality, higher yielding debt securities (junk
bonds). The Portfolio may also make use of various other investment strategies
and derivatives. Up to 50% of its total assets may be used for securities
lending purposes. No more than 30% of the Portfolio's assets will be invested
in securities of foreign issuers.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up
or down depending on general market conditions. Other principal risks include:
ASSET ALLOCATION RISK: In addition to the risks associated with the securities
in which the Portfolio invests, the Portfolio is subject to the risk that the
Adviser's allocation of the Portfolio's assets between debt and equity
securities may adversely affect the Portfolio's value.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the
Portfolio's performance will be affected by changes in interest rates, the
credit risk of the issuer, the duration or maturity of the Portfolio's fixed
income holdings, and adverse market or economic conditions. When interest
rates rise, the value of the Portfolio's fixed income securities, particularly
those with longer durations or maturities, will go down. When interest rates
fall, the reverse is true. In addition, to the extent that the Portfolio
invests in investment-grade securities which are rated BBB by S&P or an
equivalent rating by any other NRSRO, it will be exposed to greater risk than
if it invested in higher-rated obligations because BBB- rated securities are
regarded as having only an adequate capacity to pay principal and interest,
are considered to lack outstanding investment characteristics, and may be
speculative. Other risks that relate to the Portfolio's investment in fixed
income securities include:
INTEREST RATE RISK: When interest rates rise, the value (i.e., share price
and total return) of the Portfolio's fixed income securities, particularly
those with longer durations or maturities, will go down. When interest
rates fall, the reverse is true.
JUNK BOND RISK: The Portfolio may invest a portion of its assets in "junk
bonds" or lower-rated securities rated BB or lower by S&P or an equivalent
rating by any other NRSRO or unrated securities of similar quality.
Therefore, credit risk is particularly significant for this Portfolio. Junk
bonds have speculative elements or are predominantly speculative credit
risks. This Portfolio may also be subject to greater credit risk because it
may invest in debt securities issued in connection with corporate
<PAGE>
- ----------
33 ALLIANCE GROWTH INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
restructurings by highly leveraged issuers or in debt securities not
current in the payment of interest or principal, or in default.
LEVERAGING RISK: When the Portfolio borrows money or otherwise leverages its
portfolio, the value of an investment in the Portfolio will be more volatile and
all other risk will tend to be compounded.
SMALL-CAP AND MID-CAP COMPANY RISK: The Portfolio's investments in small-cap and
mid-cap companies may be subject to more abrupt or erratic movements in price
than are those of larger, more established companies because: the securities of
such companies are less well-known, held primarily by insiders or institutional
investors and may trade less frequently and in lower volume; such companies are
more likely to experience greater or more unexpected changes in their earnings
and growth prospects; such companies have limited financial resources or may
depend on a few key employees; and the products of technologies of such
companies may be at a relatively early stage of development or not fully tested.
LIQUIDITY RISK: Certain securities held by the Portfolio may be difficult (or
impossible) to sell at the time and at the price the seller would like which may
cause the Portfolio to lose money or be prevented from earning capital gains.
CONVERTIBLE SECURITIES RISK: Convertible securities generally enable the
Portfolio to benefit from increases in the market price of the underlying common
stock and provide higher yields than the underlying common stocks, but generally
offer lower yields than nonconvertible securities of similar quality. The value
of convertible securities fluctuates both in relation to changes in interest
rates and changes in the value of the underlying common stock.
DERIVATIVES RISK: The Portfolio's investments in derivatives can significantly
increase the Portfolio's exposure to market risk or credit risk of the
counterparty. Derivatives also involve the risk of mispricing or improper
valuation and the risk that changes in value of the derivative may not correlate
perfectly with the relevant assets, rates and indices.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities, which can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile, and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, the value of foreign investments can be adversely
affected by: unfavorable currency exchange rates (relative to the U.S. dollar
for securities denominated in foreign currencies); inadequate or inaccurate
information about foreign companies; higher transaction, brokerage and custody
costs; expropriation or nationalization; adverse changes in foreign economic and
tax policies; and foreign government instability, war or other adverse political
or economic actions.
PORTFOLIO TURNOVER RISK: The Portfolio's turnover rate was over 100% per year.
Higher portfolio turnover (e.g., over 100% per year) will cause the Portfolio to
incur additional transaction costs that could be passed through to shareholders.
SECURITIES LENDING RISK: This Portfolio may make secured loans of its portfolio
securities. The risks in lending portfolio securities, as with other extensions
of secured credit, consist of possible delay in receiving additional collateral,
or in the recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total returns for each of
the last ten calendar years and some of the risks of investing in the Portfolio
by showing yearly changes in the Portfolio's performance. The table below shows
the Portfolio's average annual total returns for the past one year, five years
and ten years and compares the
---------------------- EQ Advisors Trust
<PAGE>
BALANCED/HYBRID PORTFOLIO (CONTINUED)
- ----------
34 ALLIANCE GROWTH INVESTORS PORTFOLIO
- --------------------------------------------------------------------------------
Portfolio's performance to: (i) the returns of a broad-based index; (ii) the
returns of a "blended" index of equity and fixed income securities; and (iii)
the returns of an index of funds with similar investment objectives. Past
performance is not an indication of future performance.
The Portfolio's performance shown below is principally the performance of its
predecessor registered investment company (HRT/Alliance Growth Investors
Portfolio) managed by the Adviser using the same investment objectives and
strategy as the Portfolio. For these purposes, the Portfolio is considered to be
the successor entity to the predecessor registered investment company
(HRT/Alliance Growth Investors Portfolio) whose inception date is October 2,
1989. The assets of the predecessor were transferred to the Portfolio on October
18, 1999. Following that transfer, the performance shown (for the period October
19, 1999 through December 31, 1999) is that of the Portfolio. For these
purposes, the performance results of the Portfolio and its predecessor
registered investment company have been linked.
Both the bar chart and table assume reinvestment of dividends and distributions.
The performance results do not reflect any insurance and Contract-related fees
and expenses, which would reduce the performance results.
<TABLE>
<CAPTION>
- ----------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- ----------------------------------
[GRAPHIC OMITTED]
1990 10.7%
1991 48.8%
1992 4.9%
1993 15.3%
1994 -3.2%
1995 26.4%
1996 12.6%
1997 16.9%
1998 19.1%
1999 26.58%
<S> <C>
Best quarter (% and time period) Worst quarter (% and time period)
-------------------------------- ---------------------------------
18.16% (1998 4th Quarter) (10.60)% (1990 3rd Quarter)
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------
AVERAGE ANNUAL TOTAL RETURNS
- ----------------------------
- --------------------------------------------------------------------------
ONE YEAR FIVE YEARS TEN YEARS
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Alliance Growth Investors
Portfolio - Class IA Shares 26.58% 20.19% 17.08%
- --------------------------------------------------------------------------
70% S&P 500 Index/30%
Lehman Gov't/Corp.*,** 13.77% 22.15% 15.13%
- --------------------------------------------------------------------------
S&P 500* 21.03% 28.56% 18.21%
- --------------------------------------------------------------------------
Lipper Flexible Portfolio
Average* 12.07% 17.11% 12.94%
- --------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
** We believe that this index reflects more closely the market sectors in which
the Portfolio invests.
WHO MANAGES THE PORTFOLIO
ALLIANCE CAPITAL MANAGEMENT, L.P. ("Alliance"), 1345 Avenue of the Americas, New
York, New York 10105. Alliance has been the Adviser to the Portfolio and its
predecessor registered investment company since the predecessor commenced
operations. Alliance, a publicly traded limited partnership, is indirectly
majority-owned by Equitable. Alliance manages investment companies, endowment
funds, insurance companies, foreign entities, qualified and non-tax qualified
corporate funds, public and private pension and profit-sharing plans,
foundations and tax-exempt organizations.
ROBERT G. HEISTERBERG has been responsible for the day-to-day management of the
Portfolio and its predecessor since February 12, 1996. Mr. Heisterberg, a Senior
Vice President of Alliance and Global Economic Policy Analysis, has been
associated with Alliance since 1977.
<PAGE>
BALANCED/HYBRID PORTFOLIO (CONTINUED)
- ----------
35 MERCURY WORLD STRATEGY PORTFOLIO
- --------------------------------------------------------------------------------
MERCURY WORLD STRATEGY PORTFOLIO
INVESTMENT OBJECTIVE: Seeks high total investment return by investing
primarily in a portfolio of equity and fixed income securities, including
convertible securities, of U.S. and foreign issuers.
For purposes of this Portfolio, "total investment return" consists of interest,
dividends, discount accruals and capital changes, including changes in the value
of non-dollar denominated securities and other assets and liabilities resulting
from currency fluctuations.
THE INVESTMENT STRATEGY
The Portfolio is a non-diversified Portfolio that invests in both equity
securities and fixed income securities. The Portfolio may invest entirely in
equity securities, entirely in fixed income securities, or partly in equity
securities and partly in fixed income securities.
A Portfolio may be considered to be "non-diversified" for federal securities law
purposes because it invests in a limited number of securities. In all cases, the
Portfolio intends to be diversified for tax purposes so that it can qualify as a
regulated investment company.
The Portfolio will normally invest a significant portion of its assets in equity
securities of companies throughout the world. The equity securities in which the
Portfolio invests will primarily be common stocks of large companies.
There are no limits on the Portfolio's ability to invest in any country or
geographic region. The Portfolio can invest primarily in U.S. securities,
primarily in foreign securities, or partly in both. It normally invests in at
least three countries at any given time. The Portfolio may invest in companies
in emerging markets, but the Adviser anticipates that a substantially greater
portion of the Portfolio's equity investments will be in companies in developed
countries. At the present time, the Portfolio focuses on investments in Canada,
Western Europe, the Far East, and Latin America, as well as in the United
States. The Adviser will select the percentage of the Portfolio's assets that
will be invested in equity securities and fixed income securities, as well as
the geographic allocation of the Portfolio's investments, based on its view of
general economic and financial trends in various countries and industries, such
as inflation, commodity prices, the direction of interest and currency
movements, estimates of growth in industry output and profits, and government
fiscal policies. For example, if the Adviser believes that falling commodity
prices and decreasing estimates of industrial output globally signal low growth
and limited returns from equity securities, the Portfolio may emphasize fixed
income investments. Similarly, if the Adviser believes that low inflation, new
technologies and improvements in economic productivity in a country or region
signal a promising environment for equity securities in that country or region
the Portfolio may emphasize equity investments in that country or region.
The Portfolio may invest in fixed-income securities of any maturity, including
United States and foreign government securities and corporate debt securities.
The Portfolio will only invest in debt securities that are rated investment
grade by S&P or Moody's or unrated securities that are of comparable quality.
The Portfolio may also invest in securities denominated in currencies other than
the U.S. dollar. The Portfolio may also engage in currency transactions to hedge
against the risk of loss from changes in currency exchange rates. In addition,
the Portfolio may also employ a variety of instruments and techniques to enhance
income and to hedge against market and currency risk.
The Portfolio has no stated minimum holding period for investments, and will buy
or sell securities whenever the Adviser sees an appropriate opportunity.
---------------------- EQ Advisors Trust
<PAGE>
BALANCED/HYBRID PORTFOLIO (CONTINUED)
- ----------
36 MERCURY WORLD STRATEGY PORTFOLIO
- --------------------------------------------------------------------------------
When market or financial conditions warrant, the Portfolio may invest up to 100%
of its assets in United States Government or Government agency securities, money
market securities, other fixed income securities, or cash for temporary or
defensive purposes. Such investment strategies are inconsistent with the
Portfolio's investment objective and could result in the Portfolio not achieving
its investment objective.
THE PRINCIPAL RISKS
This Portfolio invests in common stocks, therefore, its performance may go up or
down depending on general market conditions. Other principal risks include:
CONVERTIBLE SECURITIES RISK: Convertible securities generally enable the
Portfolio to benefit from increases in the market price of the underlying common
stocks, but generally offer lower yields than unconvertible securities of
similar quality. Convertible securities fluctuate both in relation to changes in
interest rates and changes in the value of the underlying common stock.
FOREIGN SECURITIES RISK: The Portfolio's investments in foreign securities
involve risks not associated with investing in U.S. securities that can
adversely affect the Portfolio's performance. Foreign markets, particularly
emerging markets, may be less liquid, more volatile and subject to less
government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. In addition, foreign investments can be adversely affected by:
unfavorable currency exchange rates (relative to the U.S. dollar for securities
denominated in a foreign currencies); inadequate or inaccurate information about
foreign companies; higher transaction, brokerage and custody costs; adverse
changes in foreign economic and tax policies; and foreign government
instability, war or other adverse political or economic actions. Other specific
risks of investing in foreign securities include:
REGULATORY RISK: In general, foreign companies are also not subject to
uniform accounting, auditing and financial reporting standards or to other
regulatory practices and requirements as are U.S. companies, which could
adversely affect their value.
FIXED INCOME RISK: To the extent that a substantial amount of the Portfolio's
assets are invested in fixed income securities, that portion of the Portfolio's
performance will be affected by changes in interest rates, the credit risk of
the issuer, the duration or maturity of the Portfolio's fixed income holdings,
and adverse market or economic conditions. When interest rates rise, the value
of the Portfolio's fixed income securities, particularly those with longer
durations or maturities, will go down. When interest rates fall, the reverse is
true. In addition, to the extent that the Portfolio invests in investment grade
securities which are rated BBB by S&P or an equivalent rating by any other
NRSRO, it will be exposed to greater risk than higher-rated obligations because
BBB rated investment grade securities are regarded as having only an adequate
capacity to pay principal and interest, are considered to lack outstanding
investment characteristics, and may be speculative.
DERIVATIVES RISK: The Portfolio's investments in derivatives can significantly
increase the Portfolio's exposure to market risk or credit risk of the
counterparty. Derivatives also involve the risk of mispricing or improper
valuation and the risk that changes in value of the derivative may not correlate
perfectly with the relevant assets, rates and indices.
NON-DIVERSIFICATION RISK: Since a relatively high percentage of the Portfolio's
assets may be invested in the securities of a limited number of issuers, some of
which may be within the same industry, the securities of the Portfolio may be
more sensitive to changes in the market value of a single issuer or industry or
to risks associated with a single economic, political or regulatory event than a
diversified portfolio.
LIQUIDITY RISK: Certain securities held by the Portfolio may be difficult (or
impossible) to sell at the time and at the
<PAGE>
- ----------
37 MERCURY WORLD STRATEGY PORTFOLIO
- --------------------------------------------------------------------------------
price the seller would like which may cause the Portfolio to lose money or be
prevented from earning capital gains.
PORTFOLIO TURNOVER RISK: The Portfolio's turnover rate has been over 100% per
year. Higher portfolio turnover (e.g., over 100% per year) will cause the
Portfolio to incur additional transaction costs that could be passed through to
shareholders.
PORTFOLIO PERFORMANCE
The bar chart below illustrates the Portfolio's annual total return for 1998 and
1999, the Portfolio's first two years of operations, and some of the risks of
investing in the Portfolio by showing yearly changes in the Portfolio's
performance. The table below shows the Portfolio's average annual total returns
for the Portfolio for one year and since inception. The table also compares the
Portfolio's performance to the returns of a broad-based index. Both the bar
chart and table assume reinvestment of dividends and distributions. Past
performance is not an indication of future performance. The performance results
presented below do not reflect any insurance and Contract-related fees and
expenses, which would reduce the performance results. The inception date for the
Portfolio is May 1, 1997.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CALENDAR YEAR ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
1998 6.81%
1999 21.35%
<S> <C>
Best quarter: Worst quarter:
- --------------------------------------------------------------------------------
14.72% (1999 4th Quarter) (11.15)% (1998 3rd Quarter)
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
SINCE
ONE YEAR INCEPTION
- --------------------------------------------------------------------------------
<S> <C> <C>
Mercury World Strategy Portfolio 21.35% 12.11%
- --------------------------------------------------------------------------------
Mercury World Strategy Composite
Market Benchmark Index*,** 13.07% 16.18%
- --------------------------------------------------------------------------------
S&P 500* 21.03% 27.36%
- --------------------------------------------------------------------------------
</TABLE>
* For more information on this index, see the preceding section "The
Benchmarks."
** We believe that this index reflects more closely the market sectors in which
the Portfolio invests.
WHO MANAGES THE PORTFOLIO
MERCURY ASSET MANAGEMENT US ("MERCURY"), A DIVISION OF FUND ASSET MANAGEMENT,
L.P. ("FAM") 800 Scudders Mill Road, Plainsboro, New Jersey 08543. Mercury, or
the Portfolio's predecessor Adviser, Merrill Lynch Asset Management, L.P.,
("MLAM") has been the Adviser to the Portfolio since it commenced operations.
FAM and MLAM are both part of the Merrill Lynch Asset Management Group and
each is an indirect wholly-owned subsidiary of Merrill Lynch & Co., Inc., a
financial services holding company. The general partner of FAM and MLAM is
Princeton Services, Inc., a wholly-owned subsidiary of Merrill Lynch & Co.,
Inc. Mercury and its affiliates act as the manager for more than 100
registered investment companies. Mercury also offers portfolio management and
portfolio analysis services to individuals and institutions.
THOMAS R. ROBINSON is the Portfolio Manager primarily responsible for the
day-to-day management of the Portfolio since it commenced operations. Mr.
Robinson has served as a First Vice President of Mercury or its predecessor
since 1997 and as a Senior Portfolio Manager of Mercury or its predecessor
since 1995.
--------------------- EQ Advisors Trust
<PAGE>
3
More information on principal risks
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38 More information on principal risks
- --------------------------------------------------------------------------------
Risk is the chance that you will lose money on your investment or that it will
not earn as much as you expect. In general, the greater the risk, the more
money your investment can earn for you and the more you can lose. Like other
investment companies, the value of each Portfolio's shares may be affected by
the Portfolio's investment objective(s), principal investment strategies and
particular risk factors. Consequently, each Portfolio may be subject to
different principal risks. Some of the principal risks of investing in the
Portfolios are discussed below. However, other factors may also affect each
Portfolio's net asset value.
There is no guarantee that a Portfolio will achieve its investment objective(s)
or that it will not lose principal value.
GENERAL INVESTMENT RISKS: Each Portfolio is subject to
the following risks:
ASSET CLASS RISK: There is the possibility that the returns from the types of
securities in which a Portfolio invests will underperform returns from the
various general securities markets or different asset classes. Different types
of securities tend to go through cycles of outperformance and underperformance
in comparison to the general securities markets.
MARKET RISK: Each Portfolio's share price moves up and down over the short
term in reaction to stock or bond market movements. This means that you could
lose money over short periods, and perhaps over longer periods during extended
market downturns.
SECURITY SELECTION RISK: The Adviser(s) for each Portfolio rely on the
insights of different specialists in making investment decisions based on the
Portfolio's particular investment objective(s) and investment strategies.
There is the possibility that the specific securities held by a Portfolio will
underperform other funds in the same asset class or benchmarks that are
representative of the general performance of the asset class because of the
Adviser's choice of portfolio securities.
As indicated in "Summary Information Concerning EQ Advisors Trust" and "About
the Investment Portfolios," a particular Portfolio may also be subject to the
following risks:
CONVERTIBLE SECURITIES RISK: Convertible securities may include both
convertible debt and convertible preferred stock. Such securities may be
converted into shares of the underlying common stock at either a stated price
or stated rate. Therefore, convertible securities enable you to benefit from
increases in the market price of the underlying common stock. Convertible
securities provide higher yields than the underlying common stocks, but
generally offer lower yields than nonconvertible securities of similar
quality. The value of convertible securities fluctuates in relation to changes
in interest rates and, in addition, fluctuates in relation to the underlying
common stock. Subsequent to purchase by a Portfolio, convertible securities
may cease to be rated or a rating may be reduced below the minimum required
for purchase by that Portfolio. Each Adviser will consider such event in its
determination of whether a Portfolio should continue to hold the securities.
DERIVATIVES RISK: Derivatives are financial contracts whose value depends on,
or is derived from the value of an underlying asset, reference rate or index.
Derivatives include stock options, securities index options, currency options,
forward currency exchange contracts, futures contracts, swaps and options on
futures contracts. Certain Portfolios can use derivatives involving the U.S.
Government and foreign government securities and currencies. Investments in
derivatives can significantly increase your exposure to market risk, or credit
risk of the counterparty. Derivatives also involve the risk of mispricing or
improper valuation and the risk that changes in value of the derivative may
not correlate perfectly with the relevant assets, rates and indices.
FIXED INCOME RISK: To the extent that any of the Portfolios invest a
substantial amount of its assets in fixed income securities, a Portfolio may
be subject to the following risks:
<PAGE>
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39 More information on principal risks
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES RISK: The Portfolio's investments in asset-backed
securities represent interests in pools of consumer loans such as credit card
receivables, automobile loans and leases, leases on equipment such as
computers, and other financial instruments and are subject to certain
additional risks. Rising interest rates tend to extend the duration of
asset-backed securities, making them more sensitive to changes in interest
rates. As a result, in a period of rising interest rates, the Portfolio may
exhibit additional volatility. When interest rates are declining, there are
usually more prepayments of loans which will shorten the life of these
securities. Prepayments also vary based on among other factors, general
economic conditions and other demographic conditions. The reinvestment of cash
received from prepayments will, therefore, usually be at a lower interest rate
than the original investment, lowering the Portfolio's yield.
CREDIT RISK: Credit risk is the risk that the issuer or guarantor of a debt
security or counterparty to a Portfolio's transactions will be unable or
unwilling to make timely principal and/or interest payments, or otherwise will
be unable or unwilling to honor its financial obligations. Each of the
Portfolios may be subject to credit risk to the extent that it invests in debt
securities or engages in transactions, such as securities loans or repurchase
agreements, which involve a promise by a third party to honor an obligation to
the Portfolio.
Credit risk is particularly significant for the Portfolios, such as the
Alliance Growth Investors Portfolio, that invest a material portion of their
assets in "JUNK BONDS" or lower-rated securities (i.e., rated BB or lower by
S&P or an equivalent rating by any other NRSRO or unrated securities of
similar quality). These debt securities and similar unrated securities have
speculative elements or are predominantly speculative credit risks. Portfolios
such as the Alliance Growth Investors Portfolio may also be subject to greater
credit risk because they may invest in debt securities issued in connection
with corporate restructurings by highly leveraged issuers or in debt
securities not current in the payment of interest or principal, or in default.
INTEREST RATE RISK: The price of a bond or a fixed income security is
dependent upon interest rates. Therefore, the share price and total return of
a Portfolio investing a significant portion of its assets in bonds or fixed
income securities will vary in response to changes in interest rates. A rise
in interest rates causes the value of a bond to decrease, and vice versa.
There is the possibility that the value of a Portfolio's investment in bonds
or fixed income securities may fall because bonds or fixed income securities
generally fall in value when interest rates rise. The longer the term of a
bond or fixed income instrument, the more sensitive it will be to fluctuations
in value from interest rate changes. Changes in interest rates may have a
significant effect on Portfolios holding a significant portion of their assets
in fixed income securities with long term maturities.
MORTGAGE-BACKED SECURITIES RISK: In the case of mortgage-backed
securities, rising interest rates tend to extend the term to maturity of the
securities, making them even more susceptible to interest rate changes. When
interest rates drop, not only can the value of fixed income securities drop,
but the yield can drop, particularly where the yield on the fixed income
securities is tied to changes in interest rates, such as adjustable mortgages.
Also when interest rates drop, the holdings of mortgage-backed securities by a
Portfolio can reduce returns if the owners of the underlying mortgages pay off
their mortgages sooner than anticipated since the funds prepaid will have to
be reinvested at the then lower prevailing rates. This is known as prepayment
risk. When interest rates rise, the holdings of mortgage-backed securities by
a
------------------------ EQ Advisors Trust
<PAGE>
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40 More information on principal risks
- --------------------------------------------------------------------------------
Portfolio can reduce returns if the owners of the underlying mortgages pay
off their mortgages later than anticipated. This is known as extension
risk.
INVESTMENT GRADE SECURITIES RISK: Debt securities are rated by national
bond ratings agencies. Securities rated BBB by S&P or Baa by Moody's are
considered investment grade securities, but are somewhat riskier than
higher rated obligations because they are regarded as having only an
adequate capacity to pay principal and interest, and are considered to lack
outstanding investment characteristics.
JUNK BONDS OR LOWER RATED SECURITIES RISK:
Bonds rated below investment grade by S&P and Moody's are speculative in
nature, may be subject to certain risks with respect to the issuing entity
and to greater market fluctuations than higher rated fixed income
securities. They are usually issued by companies without long track records
of sales and earnings, or by those companies with questionable credit
strength. These bonds are considered "below investment grade." The retail
secondary market for these "junk bonds" may be less liquid than that of
higher rated securities and adverse conditions could make it difficult at
times to sell certain securities or could result in lower prices than those
used in calculating the Portfolio's net asset value.
FOREIGN SECURITIES RISK: A Portfolio's investments in foreign securities,
including depositary receipts, involve risks not associated with investing in
U.S. securities and can affect a Portfolio's performance. Foreign markets,
particularly emerging markets, may be less liquid, more volatile and subject to
less government supervision than domestic markets. There may be difficulties
enforcing contractual obligations, and it may take more time for trades to clear
and settle. The specific risks of investing in foreign securities, among others,
include:
CURRENCY RISK: The risk that changes in currency exchange rates will
negatively affect securities denominated in, and/or receiving revenues in,
foreign currencies. Adverse changes in currency exchange rates (relative to
the U.S. dollar) may erode or reverse any potential gains from a
Portfolio's investment in securities denominated in a foreign currency or
may widen existing losses.
EMERGING MARKET RISK: There are greater risks involved in investing in
emerging market countries and/or their securities markets. Generally,
economic structures in these countries are less diverse and mature than
those in developed countries, and their political systems are less stable.
Investments in emerging markets countries may be affected by national
policies that restrict foreign investment in certain issuers or industries.
The small size of their securities markets and low trading volumes can make
investments illiquid and more volatile than investments in developed
countries and such securities may be subject to abrupt and severe price
declines. As a result, a Portfolio investing in emerging market countries
may be required to establish special custody or other arrangements before
investing.
EURO RISK: Certain of the Portfolios may invest in securities issued by
European issuers. On January 1, 1999, 11 of the 15 member states of the
European Monetary Union ("EMU") introduced the "Euro" as a common currency.
During a three-year transitional period, the Euro will coexist with each
participating state's currency and, on July 1, 2002, the Euro is expected
to become the sole currency of the participating states. The introduction
of the Euro will result in the redenomination of European debt and equity
securities over a period of time, which may result in various legal and
accounting differences and/or tax treatments that otherwise would not
likely occur. During this period, the creation and implementation of
suitable clearing and settlement systems and other operational problems may
cause
<PAGE>
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41 More information on principal risks
- --------------------------------------------------------------------------------
market disruptions that could adversely affect investments quoted in the
Euro.
POLITICAL/ECONOMIC RISK: Changes in economic and tax policies, government
instability, war or other political or economic actions or factors may have
an adverse effect on a Portfolio's foreign investments.
REGULATORY RISK: Less information may be available about foreign companies.
In general, foreign companies are not subject to uniform accounting,
auditing and financial reporting standards or to other regulatory practices
and requirements as are U.S. companies.
TRANSACTION COSTS RISK: The costs of buying and selling foreign securities,
including tax, brokerage and custody costs, generally are higher than those
involving domestic transactions.
GROWTH INVESTING RISK: Growth investing generally focuses on companies that, due
to their strong earnings and revenue potential, offer above-average prospects
for capital growth, with less emphasis on dividend income. Earnings
predictability and confidence in earnings forecasts are an important part of the
selection process. As a result, the price of growth stocks may be more sensitive
to changes in current or expected earnings than the prices of other stocks.
Advisers using this approach generally seek out companies experiencing some or
all of the following: high sales growth, high unit growth, high or improving
returns on assets and equity, and a strong balance sheet. Such Advisers also
prefer companies with a competitive advantage such as unique management,
marketing or research and development. Growth investing is also subject to the
risk that the stock price of one or more companies will fall or will fail to
appreciate as anticipated by the Advisers, regardless of movements in the
securities market.
INDEX-FUND RISK: The BT Equity 500 Index Portfolio is not actively managed
(which involves buying and selling of securities based upon economic, financial
and market analysis and investment judgment). The BT Equity 500 Index Portfolio
utilizes a "passive" or "indexing" investment approach and attempt to duplicate
the investment performance of the particular index the Portfolio is tracking
(i.e., S&P 500 Index) through statistical procedures. Therefore, the Portfolios
will invest in the securities included in the relevant index or substantially
identical securities regardless of market trends. The Portfolios cannot modify
their investment strategies to respond to changes in the economy, which means
they may be particularly susceptible to a general decline in the U.S. or global
stock market segment relating to the relevant index.
LEVERAGING RISK: When a Portfolio borrows money or otherwise leverages its
portfolio, the value of an investment in that Portfolio will be more volatile
and all other risks will tend to be compounded. All of the Portfolios may take
on leveraging risk by investing in collateral from securities loans and by
borrowing money to meet redemption requests.
LIQUIDITY RISK: Certain securities held by a Portfolio may be difficult (or
impossible) to sell at the time and at the price the seller would like. A
Portfolio may have to hold these securities longer than it would like and may
forego other investment opportunities. There is the possibility that a Portfolio
may lose money or be prevented from earning capital gains if it can not sell a
security at the time and price that is most beneficial to the Portfolio.
Portfolios that invest in privately-placed securities, high-yield bonds,
mortgage-backed securities or foreign or emerging market securities, which have
all experienced periods of illiquidity, are subject to liquidity risks. A
particular Portfolio may be more susceptible to some of these risks than others,
as noted in the description of each Portfolio.
NON-DIVERSIFICATION RISK: The Mercury World Strategy Portfolio is classified as
a "non-diversified" investment company, which means that the proportion of the
Portfolio's assets that may be invested in the securities of a single issuer is
not limited by the 1940 Act. Since a relatively high
----------------- EQ Advisors Trust
<PAGE>
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42 More information on principal risks
- --------------------------------------------------------------------------------
percentage of the non-diversified Portfolio's assets may be invested in the
securities of a limited number of issuers, some of which may be within the
same industry, the securities of the Portfolio may be more sensitive to
changes in the market value of a single issuer or industry. The use of such a
focused investment strategy may increase the volatility of the Portfolio's
investment performance, as the Portfolio may be more susceptible to risks
associated with a single economic, political or regulatory event than a
diversified portfolio. If the securities in which the Portfolio invests
perform poorly, the Portfolio could incur greater losses than it would have
had it been invested in a greater number of securities. However to qualify as
a regulated investment company ("RIC") under the Internal Revenue Code of
1986, as amended (the "Code") and receive pass through tax treatment, the
Portfolio at the close of each fiscal quarter, may not have more than 25% of
its total assets invested in the securities of any one issuer (excluding U.S.
Government obligations) and with respect to 50% of its assets, (i) may not
have more than 5% of its total assets invested in the securities of any one
issuer and (ii) may not own more than 10% of the outstanding voting securities
of any one issuer. The non-diversified Portfolio intends to qualify as a RIC.
PORTFOLIO TURNOVER RISK: Consistent with their investment policies, the
Portfolios also will purchase and sell securities without regard to the effect
on portfolio turnover. Higher portfolio turnover (e.g., over 100% per year)
will cause a Portfolio to incur additional transaction costs that could be
passed through to shareholders.
SECURITIES LENDING RISK: For purposes of realizing additional income, each
Portfolio may lend securities to broker-dealers approved by the Board of
Trustees. Any such loan of portfolio securities will be continuously secured
by collateral at least equal to the value of the security loaned. Such
collateral will be in the form of cash, marketable securities issued or
guaranteed by the U.S. Government or its agencies, or a standby letter of
credit issued by qualified banks. The risks in lending portfolio securities,
as with other extensions of secured credit, consist of possible delay in
receiving additional collateral or in the recovery of the securities or
possible loss of rights in the collateral should the borrower fail
financially. Loans will only be made to firms deemed by the Adviser to be of
good standing and will not be made unless, in the judgment of the Adviser, the
consideration to be earned from such loans would justify the risk.
SMALL-CAP AND MID-CAP COMPANY RISK: A Portfolio's investments in small-cap and
mid-cap companies may involve greater risks than investments in larger, more
established issuers. Smaller companies may have narrower product lines, more
limited financial resources and more limited trading markets for their stock,
as compared with larger companies. Their securities may be less well-known and
trade less frequently and in more limited volume than the securities of
larger, more established companies. In addition, small-cap and mid-cap
companies are typically subject to greater changes in earnings and business
prospects than larger companies. Consequently, the prices of small company
stocks tend to rise and fall in value more frequently than the stocks of
larger companies. Although investing in small-cap and mid-cap companies offers
potential for above-average returns, the companies may not succeed and the
value of their stock could decline significantly.
VALUE INVESTING RISK: Value investing attempts to identify strong companies
selling at a discount from their perceived true worth. Advisers using this
approach generally select stocks at prices, in their view, that are
temporarily low relative to the company's earnings, assets, cash flow and
dividends. Value investing is subject to the risk that the stocks' intrinsic
value may never be fully recognized or realized by the market, or their prices
may go down. In addition, there is the risk that a stock judged to be
undervalued may actually be appropriately priced. Value investing generally
emphasizes companies that, considering their assets and earnings history, are
attractively priced and may provide dividend income.
<PAGE>
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43 More information on principal risks
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The Trust's Portfolios are not insured by the FDIC or any other government
agency. Each Portfolio is not a deposit or other obligation of any financial
institution or bank and is not guaranteed. Each Portfolio is subject to
investment risks and possible loss of principal invested.
-------------------------- EQ Advisors Trust
<PAGE>
4
Management of the Trust
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44 Management of the Trust
- --------------------------------------------------------------------------------
This section gives you information on the Trust, the Manager and the Advisers
for the Portfolios. More detailed information concerning each of the Advisers
and portfolio managers is included in the description for each Portfolio in
the section "About The Investment Portfolios."
THE TRUST
The Trust is organized as a Delaware business trust and is registered with the
Securities and Exchange Commission ("SEC") as an open-end management
investment company. The Trust issues shares of beneficial interest that are
currently divided among forty-one (41) Portfolios, each of which has
authorized Class IA and Class IB shares. Each Portfolio has its own
objectives, investment strategies and risks, which have been previously
described in this prospectus.
THE MANAGER
The Equitable Life Assurance Society of the United States ("Equitable"), 1290
Avenue of the Americas, New York, New York 10104, currently serves as the
Manager of the Trust. EQ Financial Consultants, Inc. ("EQFC") previously
served as the Manager of the Trust, until September 17, 1999 when the Trust's
Investment Management Agreement was transferred to Equitable. Equitable is an
investment adviser registered under the Investment Advisers Act of 1940, as
amended, and a wholly-owned subsidiary of AXA Financial, Inc. ("AXA
Financial"), a subsidiary of AXA, a French insurance holding company.
Subject to the supervision and direction of the Board of Trustees, the Manager
has overall responsibility for the general management of the Trust. In the
exercise of that responsibility, and under the Multi-Manager Order, the
Manager, without obtaining shareholder approval but subject to the review and
approval by the Board of Trustees, may: (i) select new or additional Advisers
for the Portfolios; (ii) enter into new investment advisory agreements and
materially modify existing investment advisory agreements; and (iii) terminate
and replace the Advisers. The Manager also monitors each Adviser's investment
program and results, reviews brokerage matters, and carries out the directives
of the Board of Trustees. The Manager also supervises the provision of
services by third parties such as the Trust's custodian.
The contractual management fee rates payable by the Trust are at the following
annual percentages of the value of each Portfolio's average daily net assets:
CONTRACTUAL FEE UNDER MANAGEMENT AGREEMENT (AS A PERCENTAGE OF AVERAGE DAILY
NET ASSETS)(FEE ON ALL ASSETS)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
INDEX PORTFOLIO
- --------------------------------------------------------------------------------
<S> <C>
- --------------------------------------------------------------------------------
BT Equity 500 Index 0.250%
- --------------------------------------------------------------------------------
</TABLE>
<PAGE>
- -----
45 Management of the Trust
- --------------------------------------------------------------------------------
CONTRACTUAL FEE UNDER MANAGEMENT AGREEMENT
(AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
FIRST NEXT NEXT NEXT
EQUITY PORTFOLIOS $1 BILLION $1 BILLION $3 BILLION $5 BILLION THEREAFTER
- ------------------------------------ ------------ ------------ ------------ ------------ -----------
<S> <C> <C> <C> <C> <C>
Alliance Conservative Investors 0.600% 0.550% 0.525% 0.500% 0.475%
Alliance Global 0.750% 0.700% 0.675% 0.650% 0.625%
Alliance Growth Investors 0.600% 0.550% 0.525% 0.500% 0.475%
Calvert Socially Responsible 0.650% 0.600% 0.575% 0.550% 0.525%
Mercury World Strategy 0.700% 0.650% 0.625% 0.600% 0.575%
MFS Emerging Growth Companies 0.650% 0.600% 0.575% 0.550% 0.525%
MFS Research 0.650% 0.600% 0.575% 0.550% 0.525%
T. Rowe Price Equity Income 0.600% 0.550% 0.525% 0.500% 0.475%
Warburg Pincus Small Company Value 0.750% 0.700% 0.675% 0.650% 0.625%
- ----------------------------------------------------------------------------------------------------
</TABLE>
For the Warburg Pincus Small Cap Value Portfolio, the Manager has agreed not to
implement any increase in the applicable management fee rates (as approved by
shareholders) until July 31, 2001, unless the Board agrees that such a
management fee increase should be put into operation earlier.
------------------------- EQ Advisors Trust
<PAGE>
- ----------
46 Management of the Trust
- --------------------------------------------------------------------------------
The table below shows the annual rate of the management fees (as a percentage of
each Portfolio's average daily net assets) that the Manager (or the predecessor
Manager for certain of the Portfolios) received in 1999 for managing each of the
Portfolios and the rate of the management fees waived by the Manager (or the
predecessor Manager for certain of the Portfolios) in 1999 in accordance with
the provisions of the Expense Limitation Agreement, as defined directly below,
between the Manager and the Trust with respect to certain of the Portfolios.
MANAGEMENT FEES PAID BY THE PORTFOLIOS IN 1999
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
ANNUAL RATE OF
RATE FEES
PORTFOLIOS RECEIVED WAIVED
- --------------------------------------------------------------------------------
<S> <C> <C>
Alliance Conservative Investors 0.48% 0.00%
Alliance Global 0.63% 0.00%
Alliance Growth Investors 0.50% 0.00%
BT Equity Index 500 0.25% 0.12%
Calvert Socially Responsible 0.65% 4.33%
Mercury World Strategy 0.70% 0.20%
MFS Emerging Growth 0.55% 0.10%
Companies
MFS Research 0.55% 0.11%
T. Rowe Price Equity Income 0.55% 0.15%
Warburg Pincus Small Company 0.65% 0.13%
Value
- --------------------------------------------------------------------------------
</TABLE>
EXPENSE LIMITATION AGREEMENT
In the interest of limiting until April 30, 2001 the expenses of each
Portfolio (except for the Portfolios for which Alliance serves as Investment
Adviser, other than EQ/Alliance Premier Growth Portfolio), the Manager has
entered into an amended and restated expense limitation agreement with the
Trust with respect to those Portfolios ("Expense Limitation Agreement").
Pursuant to that Expense Limitation Agreement, the Manager has agreed to waive
or limit its fees and to assume other expenses so that the total annual
operating expenses of each Portfolio (other than interest, taxes, brokerage
commissions, other expenditures which are capitalized in accordance with
generally accepted accounting principles, other extraordinary expenses not
incurred in the ordinary course of each Portfolio's business and amounts
payable pursuant to a plan adopted in accordance with Rule 12b-1 under the
1940 Act), are limited to the following respective expense ratios:
EXPENSE LIMITATION PROVISIONS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
TOTAL EXPENSES
LIMITED TO (% OF
PORTFOLIOS DAILY NET ASSETS)
- --------------------------------------------------------------------------------
<S> <C>
BT Equity 500 Index 0.35%
Calvert Socially Responsible 0.80%
Mercury World Strategy 0.95%
MFS Emerging Growth Companies 0.75%
MFS Research 0.70%
T. Rowe Price Equity Income 0.70%
Warburg Pincus Small Company Value 0.85%
- --------------------------------------------------------------------------------
</TABLE>
Each Portfolio may at a later date reimburse to the Manager the management
fees waived or limited and other expenses assumed and paid by the Manager
pursuant to the Expense Limitation Agreement provided such Portfolio has
reached a sufficient asset size to permit such reimbursement to be made
without causing the total annual expense ratio of each Portfolio to exceed the
percentage limits stated above. Consequently, no reimbursement by a Portfolio
will be made unless: (i) the Portfolio's assets exceed $100 million;
(ii) the Portfolio's total annual expense ratio is less than the respective
percentages stated above; and (iii) the payment of such reimbursement has been
approved by the Trust's Board of Trustees on a quarterly basis.
The total amount of reimbursement to which the Manager may be entitled will
equal, at any time, the sum of (i) all investment management fees previously
waived or reduced by the Manager and (ii) all other payments previously
remitted by the Manager to the Portfolio in accordance with the Expense
Limitation Agreement during any of the previous five (5) fiscal years, (or
three (3) fiscal years for certain Portfolios) less any reimbursement that the
Portfolio has
<PAGE>
- ----------
47 Management of the Trust
- --------------------------------------------------------------------------------
previously paid to the Manager with respect to (a) such investment management
fees previously waived or reduced and (b) such other payments previously
remitted by the Manager to the Portfolio.
THE ADVISERS
Each Portfolio has one or more Advisers that furnish an investment program for
the Portfolio (or portion thereof for which the entity serves as Adviser)
pursuant to an investment advisory agreement with the Manager. Each Adviser
makes investment decisions on behalf of the Portfolio (or portion thereof for
which the entity serves as Adviser), places all orders for the purchase and
sale of investments for the Portfolio's account with brokers or dealers
selected by such Adviser or the Manager and may perform certain limited
related administrative functions in connection therewith.
The Manager has received an exemptive order, the Multi-Manager Order, from the
SEC that permits the Manager, subject to board approval and without the
approval of shareholders to: (a) employ a new Adviser or additional Advisers
for any Portfolio; (b) enter into new investment advisory agreements and
materially modify existing investment advisory agreements; and (c) terminate
and replace the Advisers without obtaining approval of the relevant
Portfolio's shareholders. However, the Manager may not enter into an
investment advisory agreement with an "affiliated person" of the Manager (as
that term is defined in Section 2(a)(3) of the 1940 Act ("Affiliated
Adviser"), such as Alliance, unless the investment advisory agreement with the
Affiliated Adviser, including compensation, is approved by the affected
Portfolio's shareholders, including, in instances in which the investment
advisory agreement pertains to a newly formed Portfolio, the Portfolio's
initial shareholder. In such circumstances, shareholders would receive notice
of such action, including the information concerning the Adviser that normally
is provided in an information statement under Schedule 14C of the Securities
Exchange Act of 1934, as amended ("1934 Act").
The Manager pays each Adviser a fee based on the Portfolio's average daily net
assets. No Portfolio is responsible for the fees paid to each of the Advisers.
THE ADMINISTRATOR
Pursuant to an agreement, Equitable currently serves as the Administrator to
the Trust. As Administrator, Equitable provides the Trust with necessary
administrative, fund accounting and compliance services, and makes available
the office space, equipment, personnel and facilities required to provide such
services to the Trust.
Equitable may carry out its responsibilities either directly or through
sub-contracting with third party service providers. For these services, the
Trust pays Equitable $30,000 for each Portfolio, and a monthly fee at the
annual rate of 0.04 of 1% of the first $3 billion of total Trust assets, 0.03
of 1% of the next $3 billion of the total Trust assets; 0.025 of 1% of the
next $4 billion of the total Trust assets; and 0.0225% of 1% of the total
Trust assets in excess of $10 billion.
THE TRANSFER AGENT
Equitable serves as the transfer agent and dividend disbursing agent of the
Trust and receives no compensation for serving in such capacity.
BROKERAGE PRACTICES
In selecting brokers and dealers in accordance with Section 28(e) of the 1934
Act, the Manager and each Adviser may consider research and brokerage services
received by the Manager, the Advisers, the Trust or any Portfolio. Subject to
seeking the most favorable net price and execution available, the Manager and
each Adviser may also consider sales of shares of the Trust as a factor in the
selection of brokers and dealers. Finally, at the discretion of the Board, the
Trust may direct the Manager to cause Advisers to effect securities
transactions through broker-dealers in a manner that would help to generate
resources to (i) pay the cost of certain expenses which the Trust is required
to pay or for
--------------------------- EQ Advisors Trust
<PAGE>
- ----------
48 Management of the Trust
- --------------------------------------------------------------------------------
which the Trust is required to arrange payment or (ii) finance activities that
are primarily intended to result in the sale of Trust shares.
BROKERAGE TRANSACTIONS WITH AFFILIATES
To the extent permitted by law, the Trust may engage in securities and other
transactions with entities that may be affiliated with the Manager or the
Advisers. The 1940 Act generally prohibits the Trust from engaging in
principal securities transactions with an affiliate of the Manager or the
Advisers unless pursuant to an exemptive order from the SEC. For these
purposes, however, the Trust has considered this issue and believes, based
upon advice of counsel, that a broker-dealer affiliate of an Adviser to one
Portfolio should not be treated as an affiliate of an Adviser to another
Portfolio for which such Adviser does not provide investment advice in whole
or in part. The Trust has adopted procedures that are reasonably designed to
provide that any commission it pays to affiliates of the Manager or Advisers
does not exceed the usual and customary broker's commission. The Trust has
also adopted procedures permitting it to purchase securities, under certain
restrictions prescribed by a rule under the 1940 Act, in a public offering in
which an affiliate of the Manager or Advisers is an underwriter.
<PAGE>
5
Fund distribution arrangements
- ----------------
49 Fund distribution arrangements
- --------------------------------------------------------------------------------
The Trust offers two classes of shares on behalf of each Portfolio: Class IA
shares and Class IB shares. AXA Advisors, LLC ("AXA Advisors") serves as one
of the distributors for the Class IA and Class IB shares of the Trust offered
by this Prospectus. Equitable Distributors, Inc. ("EDI") serves as the other
distributor for the Class IA and Class IB shares of the Trust. Both classes of
shares are offered and redeemed at their net asset value without any sales
load. AXA Advisors and EDI are affiliates of Equitable. Both AXA Advisors and
EDI are registered as broker-dealers under the 1934 Act and are members of the
National Association of Securities Dealers, Inc.
The Trust has adopted a Distribution Plan under Rule 12b-1 under the 1940 Act
for the Trust's Class IB shares. Under the Class IB Distribution Plan the
Class IB shares of the Trust pay each of the distributors an annual fee to
compensate them for promoting, selling and servicing shares of the Portfolios.
The annual fees equal 0.25% of each Portfolio's average daily net assets. Over
time, the fees will increase your cost of investing and may cost you more than
other types of charges.
<PAGE>
6
Purchase and redemption
- ----------------
50 Purchase and redemption
- --------------------------------------------------------------------------------
The price at which a purchase or redemption is effected is based on the next
calculation of net asset value after an order is placed by an insurance
company or qualified retirement plan investing in or redeeming from the Trust.
Net asset value per share is calculated for purchases and redemption of shares
of each Portfolio by dividing the value of total Portfolio assets, less
liabilities (including Trust expenses and class related expenses, which are
accrued daily), by the total number of outstanding shares of that Portfolio.
The net asset value per share of each Portfolio is determined each business
day at 4:00 p.m. Eastern time. Net asset value per share is not calculated on
days on which the New York Stock Exchange ("NYSE") is closed for trading.
Portfolios that invest a significant portion of their assets in foreign
securities may experience changes in their net asset value on days when a
shareholder may not purchase or redeem shares of that Portfolio because
foreign securities (other than depositary receipts) are valued at the close of
business in the applicable foreign country.
All shares are purchased and redeemed in accordance with the Trust's Amended
and Restated Declaration of Trust and By-Laws. Sales and redemptions of shares
of the same class by the same shareholder on the same day will be netted for
each Portfolio. All redemption requests will be processed and payment with
respect thereto will normally be made within seven days after tenders.
The Trust may suspend redemption, if permitted by the 1940 Act, for any period
during which the New York Stock Exchange is closed or during which trading is
restricted by the SEC or the SEC declares that an emergency exists. Redemption
may also be suspended during other periods permitted by the SEC for the
protection of the Trust's shareholders. If the Board of Trustees determines
that it would be detrimental to the best interest of the Trust's remaining
shareholders to make payment in cash, the Trust may pay redemption proceeds in
whole or in part by a distribution-in-kind of readily marketable securities.
You should note that the Trust is not designed for professional "market
timing" organizations, or other organizations or individuals engaging in a
market timing strategy, making programmed transfers, frequent transfers or
transfers that are large in relation to the total assets of each of the
Trust's Portfolios. Market timing strategies are disruptive to the Trust's
Portfolios. If we determine that your transfer patterns among the Trust's
Portfolios reflect a market timing strategy, we reserve the right to take
action including, but not limited to: restricting the availability of
transfers through telephone requests, facsimile transmissions, automated
telephone services, internet services or any electronic transfer services. We
may also refuse to act on transfer instructions of an agent acting under a
power of attorney who is acting on behalf of more than one owner.
<PAGE>
7
How assets are valued
- ----------------
51 How assets are valued
- --------------------------------------------------------------------------------
Values are determined according to accepted practices and all laws and
regulations that apply. The assets of each Portfolio are generally valued as
follows:
o Stocks and debt securities which mature in more than 60 days are valued on
the basis of market quotations.
o Foreign securities not traded directly, including depositary receipts, in
the United States are valued at representative quoted prices in the
currency in the country of origin. Foreign currency is converted into
United States dollar equivalents at current exchange rates. Because foreign
markets may be open at different times than the NYSE, the value of a
Portfolio's shares may change on days when shareholders are not able to buy
or sell them. If events materially affecting the values of the Portfolios'
foreign investments occur between the close of foreign markets and the
close of regular trading on the NYSE, these investments may be valued at
their fair value.
o Short-term debt securities in the Portfolios which mature in 60 days or
less are valued at amortized cost, which approximates market value.
o Other securities and assets for which market quotations are not readily
available or for which valuation cannot be provided are valued in good
faith by the Valuation Committee of the Board of Trustees of the Trust
using its best judgment.
<PAGE>
8
Tax information
- ----------------
52 Tax information
- --------------------------------------------------------------------------------
Each Portfolio of the Trust is a separate regulated investment company for
federal income tax purposes. Regulated investment companies are usually not
taxed at the entity (Portfolio) level. They pass through their income and
gains to their shareholders by paying dividends. Their shareholders include
this income on their respective tax returns. A Portfolio will be treated as a
regulated investment company if it meets specified federal income tax rules,
including types of investments, limits on investments, calculation of income,
and dividend payment requirements. Although the Trust intends that it and each
Portfolio will be operated to have no federal tax liability, if they have any
federal tax liability, that could hurt the investment performance of the
Portfolio in question. Also, any Portfolio investing in foreign securities or
holding foreign currencies could be subject to foreign taxes which could
reduce the investment performance of the Portfolio.
It is important for each Portfolio to maintain its federal income tax
regulated investment company status because the shareholders of the Portfolio
that are insurance company separate accounts will then be able to use a
favorable federal income tax investment diversification testing rule in
determining whether the Contracts indirectly funded by the Portfolio meet tax
qualification rules for variable insurance contracts. If a Portfolio fails to
meet specified investment diversification requirements, owners of non-pension
plan Contracts funded through the Trust could be taxed immediately on the
accumulated investment earnings under their Contracts and could lose any
benefit of tax deferral. Equitable, in its capacity as Administrator therefore
carefully monitors compliance with all of the regulated investment company
rules and variable insurance contract investment diversification rules.
<PAGE>
9
Financial Highlights
- --------
53 Financial Highlights
- --------------------------------------------------------------------------------
The financial highlights table is intended to help you understand the financial
performance for the Trust's Class IA and Class IB shares since May 1, 1997. With
respect to the Portfolios that are advised by Alliance, financial information in
the table below is for the past five (5) years (or, if shorter, the period of
the Portfolio's operations). Since the EQ/Alliance Technology Stock Portfolio
will commence operations on May 1, 2000, no information for that Portfolio is
provided below. The information below for the Class IA and Class IB shares has
been derived from the financial statements of the Trust, which have been audited
by PricewaterhouseCoopers LLP, independent public accountants.
PricewaterhouseCoopers LLP's report on the Trust's financial statements as of
December 31, 1999 appears in the Trust's Annual Report. The information should
be read in conjunction with the financial statements contained in the Trust's
Annual Report which are incorporated by reference into the Trust's Statement of
Additional Information (SAI) and available upon request.
ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO(d)(e)
<TABLE>
<CAPTION>
CLASS IA
----------------------------------------------------------------
YEAR ENDED DECEMBER 31,
----------------------------------------------------------------
1999 1998 1997 1996 1995
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...... $ 12.32 $ 11.89 $ 11.29 $ 11.52 $ 10.15
------- ------- ------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ................... 0.47 0.49 0.49 0.50 0.60
Net realized and unrealized gain
on investments and foreign
currency transactions .................. 0.76 1.12 0.97 0.07 1.43
------- ------- ------- ------- -------
Total from investment operations......... 1.23 1.61 1.46 0.57 2.03
------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment
income ................................. (0.44) (0.48) (0.49) (0.51) (0.59)
Distributions from realized gains ....... (0.56) (0.70) (0.37) (0.27) (0.07)
Distributions in excess of realized
gains .................................. - - - (0.02) -
Tax return of capital distributions ..... - - - - -
-------- -------- -------- -------- --------
Total dividends and distributions ....... (1.00) (1.18) (0.86) (0.80) (0.66)
-------- -------- -------- -------- --------
Net asset value, end of period ........... $ 12.55 $ 12.32 $ 11.89 $ 11.29 $ 11.52
======== ======== ======== ======== ========
Total return .............................. 10.14% 13.88% 13.25% 5.21% 20.40%
======== ======== ======== ======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ......... $394,489 $355,441 $307,847 $282,402 $252,101
Ratio of expenses to average net
assets .................................. 0.53% 0.53% 0.57% 0.61% 0.59%
Ratio of net investment income to
average
net assets .............................. 3.73% 3.99% 4.17% 4.48% 5.48%
Portfolio turnover rate ................... 111% 103% 206% 181% 287%
<CAPTION>
CLASS 1B
----------------------------------------
YEAR ENDED MAY 1, 1997*
DECEMBER 31, TO
----------------------- DECEMBER 31,
1999 1998 1997
----------- ----------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period ...... $ 12.31 $ 11.88 $ 11.29
------- ------- ---------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ................... 0.44 0.46 0.31
Net realized and unrealized gain
on investments and foreign
currency transactions .................. 0.75 1.12 1.01
------- ------- ---------
Total from investment operations......... 1.19 1.58 1.32
------- ------- ---------
<PAGE>
LESS DISTRIBUTIONS:
Dividends from net investment
income ................................. (0.43) (0.45) (0.36)
Distributions from realized gains ....... (0.56) (0.70) (0.37)
Distributions in excess of realized
gains .................................. - - -
Tax return of capital distributions ..... - - -
------- ------- ---------
Total dividends and distributions ....... (0.99) (1.15) (0.73)
------- ------- ---------
Net asset value, end of period ........... $ 12.51 $ 12.31 $ 11.88
======= ======= =========
Total return .............................. 9.87% 13.60% 11.84%(b)
======= ======= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ......... $81,555 $32,653 $ 5,694
Ratio of expenses to average net
assets .................................. 0.78% 0.78% 0.80%(a)
Ratio of net investment income to
average
net assets .............................. 3.48% 3.68% 3.82%(a)
Portfolio turnover rate ................... 111% 103% 206%
</TABLE>
<PAGE>
- -----
54 Financial Highlights
- --------------------------------------------------------------------------------
ALLIANCE GLOBAL PORTFOLIO(d)(e):
<TABLE>
<CAPTION>
CLASS IA
----------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
----------------------------------------------------------------------
1999 1998 1997 1996 1995
-------------- -------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period .......................... $ 19.46 $ 17.29 $ 16.92 $ 15.74 $ 13.87
--------- --------- --------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ........... 0.10 0.14 0.17 0.21 0.26
Net realized and unrealized
gain on investments and
foreign currency
transactions ................... 7.25 3.56 1.75 2.05 2.32
--------- --------- --------- ------- -------
Total from investment
operations ..................... 7.35 3.70 1.92 2.26 2.58
--------- --------- --------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net
investment income .............. (0.02) (0.22) (0.36) (0.21) (0.25)
Dividends in excess of net
investment income .............. - - - (0.08) -
Distributions from realized
gains .......................... (1.63) (1.31) (1.19) (0.79) (0.42)
Distributions in excess of
realized gains ................. - - - - (0.03)
Tax return of capital
distributions .................. - - - - (0.01)
---------- ---------- ---------- -------- --------
Total dividends and
distributions .................. (1.65) (1.53) (1.55) (1.08) (0.71)
---------- ---------- ---------- -------- --------
Net asset value, end of period..... $ 25.16 $ 19.46 $ 17.29 $ 16.92 $ 15.74
========== ========== ========== ======== ========
Total return ...................... 38.53% 21.80% 11.66% 14.60% 18.81%
========== ========== ========== ======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's) ......................... $1,869,185 $1,360,220 $1,203,867 $997,041 $ 686,140
Ratio of expenses to average
net assets ...................... 0.70% 0.71% 0.69% 0.60 % 0.61%
Ratio of net investment
income to average net
assets .......................... 0.45% 0.72% 0.97% 1.28% 1.76%
Portfolio turnover rate ........... 93% 105% 57% 59% 67%
<CAPTION>
CLASS 1B
-----------------------------------------------------
OCTOBER 2,*
YEAR ENDED DECEMBER 31, 1996 TO
------------------------------------ DECEMBER 31,
1999 1998 1997 1996
------------ ----------- ----------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of
period .......................... $ 19.41 $ 17.27 $ 16.91 $ 16.57
------- ------- ------- ---------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ........... 0.03 0.08 0.12 0.02
Net realized and unrealized
gain on investments and
foreign currency
transactions ................... 7.24 3.56 1.76 0.81
------- ------- ------- ---------
Total from investment
operations ..................... 7.27 3.64 1.88 0.83
------- ------- ------- ---------
LESS DISTRIBUTIONS:
Dividends from net
investment income .............. - (0.19) (0.33) -
Dividends in excess of net
investment income .............. - - - (0.11)
Distributions from realized
gains .......................... (1.63) (1.31) (1.19) (0.10)
Distributions in excess of
realized gains ................. - - - (0.28)
Tax return of capital
distributions .................. - - - -
-------- ------- ------- ---------
Total dividends and
distributions .................. (1.63) (1.50) (1.52) (0.49)
-------- ------- ------- ---------
Net asset value, end of period..... $ 25.05 $19.41 $ 17.27 $ 16.91
======== ======= ======= =========
Total return ...................... 38.17% 21.50% 11.38% 4.98%(b)
======== ======= ======= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's) ......................... $121,052 $47,982 $21,520 $ 290
Ratio of expenses to average
net assets ...................... 0.95% 0.96% 0.97% 0.86%(a)
Ratio of net investment
income to average net
assets .......................... 0.16% 0.41% 0.67% 0.48%(a)
Portfolio turnover rate ........... 93% 105% 57% 59%
</TABLE>
<PAGE>
- -----
55 Financial Highlights
- --------------------------------------------------------------------------------
ALLIANCE GROWTH INVESTORS PORTFOLIO(D)(E):
<TABLE>
<CAPTION>
CLASS IA CLASS IB
---------------------------------------- -----------------------------------------------
OCTOBER 2,*
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, 1996 TO
--------------------------------------------- ---------------------------- DECEMBER 31,
1999 1998 1997 1996 1995 1999 1998 1997 1996
------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period ............................. $19.87 $18.55 $17.20 $17.68 $14.66 $19.84 $18.52 $17.19 $16.78
-------- -------- -------- -------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income .............. 0.37 0.41 0.41 0.40 0.57 0.31 0.36 0.36 0.07
Net realized and unrealized
gain on investments and
foreign currency
transactions ...................... 4.83 3.03 2.43 1.66 3.24 4.82 3.03 2.43 0.71
-------- -------- -------- -------- -------- -------- -------- -------- --------
Total from investment
operations ........................ 5.20 3.44 2.84 2.06 3.81 5.13 3.39 2.79 0.78
-------- -------- -------- -------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income ............................ (0.35) (0.41) (0.46) (0.40) (0.54) (0.31) (0.36) (0.43) (0.02)
Dividends in excess of net
investment income ................. -- -- -- (0.03) (0.01) -- -- -- (0.09)
Distributions from realized
gains ............................. (2.15) (1.71) (1.03) (2.10) (0.24) (2.15) (1.71) (1.03) (0.02)
Distributions in excess of
realized gains .................... -- -- -- (0.01) -- -- -- -- (0.24)
Tax return of capital distributions . -- -- -- -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- -------- -------- --------
Total dividends and distributions ... (2.50) (2.12) (1.49) (2.54) (0.79) (2.46) (2.07) (1.46) (0.37)
-------- -------- -------- -------- -------- -------- -------- -------- --------
Net asset value, end of period ....... $22.57 $19.87 $ 18.55 $17.20 $17.68 $22.51 $19.84 $18.52 $17.19
======== ======== ======== ======== ======== ======== ======== ======== ========
Total return ......................... 26.58% 19.13% 16.87% 12.61% 26.37% 26.27% 18.83% 16.58% 4.64%(b)
======== ======== ======== ======== ======== ======== ======== ======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)...$2,495,787 $1,963,074 $1,630,389 $1,301,643 $896,134 $202,850 $92,027 $35,730 $ 472
Ratio of expenses to average net
assets ............................. 0.53% 0.55% 0.57% 0.57% 0.56% 0.78% 0.80% 0.82% 0.84%(a)
Ratio of net investment income to
average net assets ................. 1.71% 2.10% 2.18% 2.31% 3.43% 1.44% 1.85% 1.88% 1.69%(a)
Portfolio turnover rate .............. 98% 102% 121% 190% 107% 98% 102% 121% 190%
------------------------- EQ Advisors Trust
</TABLE>
<PAGE>
- -----
56 Financial Highlights
- --------------------------------------------------------------------------------
BT EQUITY 500 INDEX PORTFOLIO:**
<TABLE>
<CAPTION>
CLASS IB
--------------------------------------
YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998
------------------- ------------------
<S> <C> <C>
Net asset value, beginning of period .................................................... $ 12.45 $ 10.00
------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................................................................. 0.08 0.06
Net realized and unrealized gain on investments and foreign currency transactions ..... 2.44 2.45
------- -------
Total from investment operations ...................................................... 2.52 2.51
------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income .................................................. (0.08) (0.06)
Distributions from realized gains ..................................................... (0.04) -
-------- --------
Total dividends and distributions ..................................................... (0.12) (0.06)
-------- --------
Net asset value, end of period .......................................................... $ 14.85 $ 12.45
======== ========
Total return ............................................................................ 20.30% 25.14%
======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ....................................................... $683,544 $224,247
Ratio of expenses to average net assets after waivers ................................... 0.55% 0.55%
Ratio of expenses to average net assets before waivers (f) .............................. 0.67% 0.83%
Ratio of net investment income to average net assets after waivers ...................... 0.84% 1.22%
Ratio of net investment income to average net assets before waivers (f) ................. 0.72% 0.94%
Portfolio turnover rate ................................................................. 2% 2%
Effect of voluntary expense limitation during the period: (f)
Per share benefit to net investment income ........................................... $ 0.01 $ 0.01
</TABLE>
<PAGE>
- -----
57 Financial Highlights
- --------------------------------------------------------------------------------
CALVERT SOCIALLY RESPONSIBLE PORTFOLIO
<TABLE>
<CAPTION>
CLASS IB
-------------------
SEPTEMBER 1, 1999*
TO
DECEMBER 31, 1999
-------------------
<S> <C>
Net asset value, beginning of period ........................................ $ 10.00
-------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .............................................. (0.01)
Net realized and unrealized gain (loss) on investments .................... 0.83
-------
Total from investment operations .......................................... 0.82
-------
LESS DISTRIBUTIONS:
Distributions from realized gains ......................................... (0.06)
-------
Total dividends and distributions ......................................... (0.06)
-------
Net asset value, end of period .............................................. $ 10.76
=======
Total return ................................................................ 8.09 %(b)
=======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................................... $2,622
Ratio of expenses to average net assets after waivers ....................... 1.05 %(a)
Ratio of expenses to average net assets before waivers (f) .................. 5.38 %(a)
Ratio of net investment income to average net assets after waivers .......... (0.19)%(a)
Ratio of net investment income to average net assets before waivers (f) ..... (4.52)%(a)
Portfolio turnover rate ..................................................... 45 %
</TABLE>
------------------------- EQ Advisors Trust
<PAGE>
- -----
58 Financial Highlights
- --------------------------------------------------------------------------------
MERCURY WORLD STRATEGY PORTFOLIO (FKA MERRILL LYNCH WORLD STRATEGY
PORTFOLIO):
<TABLE>
<CAPTION>
CLASS IB
-------------------
YEAR ENDED
DECEMBER 31, 1999
-------------------
<S> <C>
Net asset value, beginning of period ........................................ $ 10.93
-------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ..................................................... 0.11
Net realized and unrealized gain on investments and foreign currency
transactions ............................................................. 2.22
-------
Total from investment operations .......................................... 2.33
-------
LESS DISTRIBUTIONS:
Dividends from net investment income ...................................... (0.08)
Dividends in excess of net investment income .............................. (0.03)
Distributions from realized gains ......................................... (0.17)
Distributions in excess of realized gains ................................. -
-------
Total dividends and distributions ......................................... (0.28)
-------
Net asset value, end of period .............................................. $ 12.98
=======
Total return ................................................................ 21.35%
=======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................................... $35,722
Ratio of expenses to average net assets after waivers ....................... 1.20%
Ratio of expenses to average net assets before waivers (f) .................. 1.40%
Ratio of net investment income to average net assets after waivers .......... 0.99%
Ratio of net investment income to average net assets before waivers (f) ..... 0.79%
Portfolio turnover rate ..................................................... 116%
Effect of voluntary expense limitation during the period: (f)
Per share benefit to net investment income ............................... $ 0.02
<CAPTION>
CLASS IB
--------------------------------------
MAY 1, 1997*
YEAR ENDED TO
DECEMBER 31, 1998 DECEMBER 31, 1997
------------------- ------------------
<S> <C> <C>
Net asset value, beginning of period ........................................ $ 10.31 $ 10.00
------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ..................................................... 0.15 0.08
Net realized and unrealized gain on investments and foreign currency
transactions ............................................................. 0.55 0.39
------- -------
Total from investment operations .......................................... 0.70 0.47
------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income ...................................... (0.04) (0.05)
Dividends in excess of net investment income .............................. (0.04) -
Distributions from realized gains ......................................... - -
Distributions in excess of realized gains ................................. - (0.11)
------- -------
Total dividends and distributions ......................................... (0.08) (0.16)
------- -------
Net asset value, end of period .............................................. $ 10.93 $ 10.31
======= =======
Total return ................................................................ 6.81 % 4.70 %(b)
================= =============
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................................... $30,631 $18,210
Ratio of expenses to average net assets after waivers ....................... 1.20 % 1.20%(a)
Ratio of expenses to average net assets before waivers (f) .................. 1.61 % 3.05%(a)
Ratio of net investment income to average net assets after waivers .......... 1.63 % 1.89 %(a)
Ratio of net investment income to average net assets before waivers (f) ..... 1.22 % 0.04 %(a)
Portfolio turnover rate ..................................................... 115 % 58 %
Effect of voluntary expense limitation during the period: (f)
Per share benefit to net investment income ............................... $ 0.04 $ 0.08
</TABLE>
<PAGE>
- -----
59 Financial Highlights
- --------------------------------------------------------------------------------
MFS EMERGING GROWTH COMPANIES PORTFOLIO:
<TABLE>
<CAPTION>
CLASS IA
--------------------------------------------
NOVEMBER 24, 1998*
YEAR ENDED TO
DECEMBER 31, 1999 DECEMBER 31, 1998
------------------- ------------------------
<S> <C> <C>
Net asset value, beginning of period ..... $ 16.04 $ 14.18
--------- -----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income (loss) ........... 0.01 -
Net realized and unrealized gain on
investments and foreign currency
transactions .......................... 11.83 1.86
--------- -----------
Total from investment operations ....... 11.84 1.86
--------- -----------
LESS DISTRIBUTIONS:
Dividends from net investment
income ................................ - -
Dividends in excess of net
investment income ..................... - -
Distributions from realized gains ...... (0.48) -
Distributions in excess of realized
gains ................................. - -
--------- -----------
Total dividends and distributions ...... (0.48) -
--------- -----------
Net asset value, end of period ........... $ 27.40 $ 16.04
========= ===========
Total return ............................. 74.43% 13.12%(b)
========= ===========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........ $ 46,248 $ 5,978
Ratio of expenses to average net
assets after waivers ................... 0.60 %(c) 0.60%(a)(c)
Ratio of expenses to average net
assets before waivers (f) .............. 0.70 %(c) 0.79%(a)(c)
Ratio of net investment income to
average net assets after waivers ....... 0.09 %(c) (0.05)%(a)(c)
Ratio of net investment income to
average net assets before
waivers (f) ............................ (0.01)%(c) (0.24)%(a)(c)
Portfolio turnover rate .................. 184 % 79%
Effect of voluntary expense
limitation during the period: (f)
Per share benefit to net
investment income .................... $ 0.01 $ -
<CAPTION>
CLASS IB
----------------------------------------------------------
MAY 1, 1997*
YEAR ENDED YEAR ENDED TO
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31, 1997
------------------- ------------------- ------------------
<S> <C> <C> <C>
Net asset value, beginning of period ..... $ 16.04 $ 11.92 $ 10.00
--------- ------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income (loss) ........... (0.02) (0.03) 0.02
Net realized and unrealized gain on
investments and foreign currency
transactions .......................... 11.79 4.15 2.21
--------- ------- --------
Total from investment operations ....... 11.77 4.12 2.23
--------- ------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income ................................ - - (0.02)
Dividends in excess of net
investment income ..................... - - -
Distributions from realized gains ...... (0.48) - (0.18)
Distributions in excess of realized
gains ................................. - - (0.11)
--------- ------- --------
Total dividends and distributions ...... (0.48) - (0.31)
--------- ------- --------
Net asset value, end of period ........... $ 27.33 $ 16.04 $ 11.92
========= ======= ========
Total return ............................. 73.62% 34.57% 22.42%(b)
========= ======= ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........ $1,665,635 $461,307 $ 99,317
Ratio of expenses to average net
assets after waivers ................... 0.85%(c) 0.85%(c) 0.85%(a)
Ratio of expenses to average net
assets before waivers (f) .............. 0.95%(c) 1.04%(c) 1.82%(a)
Ratio of net investment income to
average net assets after waivers ....... (0.16)%(c) (0.30)%(c) 0.61%(a)
Ratio of net investment income to
average net assets before
waivers (f) ............................ (0.26)%(c) (0.49)%(c) (0.36)%(a)
Portfolio turnover rate .................. 184% 79 % 116 %
Effect of voluntary expense
limitation during the period: (f)
Per share benefit to net
investment income .................... $ 0.01 $ 0.02 $ 0.04
</TABLE>
------------------------- EQ Advisors Trust
<PAGE>
- -----
60 Financial Highlights
- --------------------------------------------------------------------------------
MFS RESEARCH PORTFOLIO:
<TABLE>
<CAPTION>
CLASS IB
-------------------
YEAR ENDED
DECEMBER 31, 1999
-------------------
<S> <C>
Net asset value, beginning of period ........................................ $ 14.21
-------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ..................................................... 0.02
Net realized and unrealized gain on investments and foreign currency
transactions ............................................................. 3.24
-------
Total from investment operations .......................................... 3.26
-------
LESS DISTRIBUTIONS:
Dividends from net investment income ...................................... (0.02)
Dividends in excess of net investment income .............................. -
Distributions from realized gains ......................................... (0.39)
Distributions in excess of realized gains ................................. -
--------
Total dividends and distributions ......................................... (0.41)
--------
Net asset value, end of period .............................................. $ 17.06
========
Total return ................................................................ 23.12%
========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................................... $685,270
Ratio of expenses to average net assets after waivers ....................... 0.85%
Ratio of expenses to average net assets before waivers (f) .................. 0.96%
Ratio of net investment income to average net assets after waivers .......... 0.12%
Ratio of net investment income to average net assets before waivers (f) ..... 0.01%
Portfolio turnover rate ..................................................... 91%
Effect of voluntary expense limitation during the period: (f)
Per share benefit to net investment income ............................... $ 0.01
<CAPTION>
CLASS IB
--------------------------------------
MAY 1, 1997*
YEAR ENDED TO
DECEMBER 31, 1998 DECEMBER 31, 1997
------------------- ------------------
<S> <C> <C>
Net asset value, beginning of period ........................................ $ 11.48 $ 10.00
------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ..................................................... 0.04 0.02
Net realized and unrealized gain on investments and foreign currency
transactions ............................................................. 2.73 1.58
------- ----------
Total from investment operations .......................................... 2.77 1.60
------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income ...................................... (0.04) (0.02)
Dividends in excess of net investment income .............................. - -
Distributions from realized gains ......................................... - (0.01)
Distributions in excess of realized gains ................................. - (0.09)
-------- ----------
Total dividends and distributions ......................................... (0.04) (0.12)
-------- ----------
Net asset value, end of period .............................................. $ 14.21 $ 11.48
======== ==========
Total return ................................................................ 24.11% 16.07%(b)
======== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................................... $407,619 $ 114,754
Ratio of expenses to average net assets after waivers ....................... 0.85% 0.85%(a)
Ratio of expenses to average net assets before waivers (f) .................. 1.05% 1.78%(a)
Ratio of net investment income to average net assets after waivers .......... 0.44% 0.65%(a)
Ratio of net investment income to average net assets before waivers (f) ..... 0.24% (0.28)%(a)
Portfolio turnover rate ..................................................... 73% 51%
Effect of voluntary expense limitation during the period: (f)
Per share benefit to net investment income ............................... $ 0.02 $ 0.03
</TABLE>
<PAGE>
- -----
61
- --------------------------------------------------------------------------------
T. ROWE PRICE EQUITY INCOME PORTFOLIO:
<TABLE>
<CAPTION>
CLASS IA
-------------------------------------
NOVEMBER 24,
1998*
YEAR ENDED TO
DECEMBER 31, DECEMBER 31,
1999 1998
-------------- ----------------------
<S> <C> <C>
Net asset value, beginning of period ..................... $ 12.67 $ 13.22
------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................................. 0.28 0.06
Net realized and unrealized gain (loss) on
investments and foreign currency transactions ......... 0.20 (0.09)+
------- --------
Total from investment operations ....................... 0.48 (0.03)
------- --------
LESS DISTRIBUTIONS:
Dividends from net investment income ................... (0.29) (0.24)
Distributions from realized gains ...................... (0.52) (0.28)
-------- --------
Total dividends and distributions ...................... (0.81) (0.52)
-------- --------
Net asset value, end of period ........................... $ 12.34 $ 12.67
======== ========
Total return ............................................. 3.80% (0.15)%(b)
======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................ $ 5,181 $ 2,415
Ratio of expenses to average net assets after waivers..... 0.60% 0.60%(a)(c)
Ratio of expenses to average net assets before
waivers (f) ............................................ 0.72% 0.79%(a)(c)
Ratio of net investment income to average net assets
after waivers .......................................... 2.15% 2.45 %(a)(c)
Ratio of net investment income to average net assets
before waivers (f) ..................................... 2.03% 2.26 %(a)(c)
Portfolio turnover rate .................................. 31% 17 %
Effect of voluntary expense limitation during the
period: (f)
Per share benefit to net investment income ............ $ 0.02 $ 0.03
<CAPTION>
CLASS IB
--------------------------------------------------
MAY 1, 1997*
YEAR ENDED YEAR ENDED TO
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1997
-------------- ----------------- -----------------
<S> <C> <C> <C>
Net asset value, beginning of period ..................... $ 12.67 $ 12.08 $ 10.00
-------- --------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................................. 0.24 0.22 0.10
Net realized and unrealized gain (loss) on
investments and foreign currency transactions ......... 0.20 0.87 2.11
-------- --------- -------
Total from investment operations ....................... 0.44 1.09 2.21
-------- --------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income ................... (0.25) (0.22) (0.09)
Distributions from realized gains ...................... (0.52) (0.28) (0.04)
--------- --------- -------
Total dividends and distributions ...................... (0.77) (0.50) (0.13)
--------- --------- -------
Net asset value, end of period ........................... $ 12.34 $ 12.67 $ 12.08
========= ========= =======
Total return ............................................. 3.54% 9.11% 22.11 %(b)
========= ========= ============
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................ $273,031 $242,001 $99,947
Ratio of expenses to average net assets after waivers..... 0.85% 0.85%(c) 0.85%(a)
Ratio of expenses to average net assets before
waivers (f) ............................................ 0.97% 1.04%(c) 1.74%(a)
Ratio of net investment income to average net assets
after waivers .......................................... 1.90% 2.20%(c) 2.49 %(a)
Ratio of net investment income to average net assets
before waivers (f) ..................................... 1.78% 2.01%(c) 1.60 %(a)
Portfolio turnover rate .................................. 31% 17% 9 %
Effect of voluntary expense limitation during the
period: (f)
Per share benefit to net investment income ............ $ 0.02 $ 0.02 $ 0.03
</TABLE>
------------------------- EQ Advisors Trust
<PAGE>
- -----
62 Financial Highlights
- --------------------------------------------------------------------------------
WARBURG PINCUS SMALL COMPANY VALUE PORTFOLIO:
<TABLE>
<CAPTION>
CLASS IA
----------------------------------------
NOVEMBER 24,
1998*
YEAR ENDED TO
DECEMBER 31, DECEMBER 31,
1999 1998
----------------- ----------------------
<S> <C> <C>
Net asset value, beginning of period ..................... $ 10.59 $ 10.40
-------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................................. 0.03 0.03
Net realized and unrealized gain (loss) on
investments and foreign currency transactions ......... 0.19 0.23 +
-------- -------
Total from investment operations ....................... 0.22 0.26
-------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income ................... (0.05) (0.06)
Distributions in excess of realized gains .............. - -
Return of capital distributions ........................ - (0.01)
-------- -------
Total dividends and distributions ...................... (0.05) (0.07)
-------- -------
Net asset value, end of period ........................... $ 10.76 $ 10.59
======== =======
Total return ............................................. 2.07% 2.63%(b)
======== =======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................ $ 2,339 $ 747
Ratio of expenses to average net assets after waivers..... 0.75%(c) 0.75%(a)(c)
Ratio of expenses to average net assets before
waivers (f) ............................................ 0.84%(c) 0.92%(a)(c)
Ratio of net investment income to average net assets
after waivers .......................................... 0.40%(c) 0.72 %(a)(c)
Ratio of net investment income to average net assets
before waivers (f) ..................................... 0.32%(c) 0.55%(a)(c)
Portfolio turnover rate .................................. 192% 111%
Effect of voluntary expense limitation during the
period: (f)
Per share benefit to net investment income ........... $ 0.01 $ 0.17
<CAPTION>
CLASS IB
-----------------------------------------------------------
MAY 1, 1997*
YEAR ENDED YEAR ENDED TO
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1997
------------------- ------------------- -------------------
<S> <C> <C> <C>
Net asset value, beginning of period ..................... $ 10.61 $ 11.85 $ 10.00
---------- ---------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................................. 0.02 0.05 0.01
Net realized and unrealized gain (loss) on
investments and foreign currency transactions ......... 0.17 (1.24) 1.90
---------- ---------- ---------
Total from investment operations ....................... 0.19 (1.19) 1.91
---------- ---------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income ................... (0.02) (0.04) (0.01)
Distributions in excess of realized gains .............. - - (0.05)
Return of capital distributions ........................ - (0.01) -
---------- ---------- ---------
Total dividends and distributions ...................... (0.02) (0.05) (0.06)
---------- ---------- ---------
Net asset value, end of period ........................... $ 10.78 $ 10.61 $ 11.85
========== ========== =========
Total return ............................................. 1.80 % (10.02)% 19.15 %(b)
================= ========== ===============
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........................ $ 149,618 $ 166,746 $120,880
Ratio of expenses to average net assets after waivers..... 1.00%(c) 1.00%(c) 1.00%(a)
Ratio of expenses to average net assets before
waivers (f) ............................................ 1.09%(c) 1.17%(c) 1.70%(a)
Ratio of net investment income to average net assets
after waivers .......................................... 0.21%(c) 0.47 %(c) 0.26 %(a)
Ratio of net investment income to average net assets
before waivers (f) ..................................... 0.12%(c) 0.30 %(c) (0.44)%(a)
Portfolio turnover rate .................................. 192% 111 % 44 %
Effect of voluntary expense limitation during the
period: (f)
Per share benefit to net investment income ........... $ 0.02 $ 0.02 $ 0.03
</TABLE>
- ----------
* Commencement of Operations
** Commenced operations on January 1, 1998.
+ The amount shown for a share outstanding throughout the period does not
accord with the aggregate net gains on investments for that period
because of the timing of sales and repurchases of the Portfolio shares in
relation to fluctuating market value of the investments in the Portfolio.
(a) Annualized
(b) Total return is not annualized.
(c) Reflects overall Portfolio ratios for investment income and non-class
specific expense.
<PAGE>
- -----
63 Financial Highlights
- --------------------------------------------------------------------------------
(d) On October 18, 1999, this Portfolio received, through a substitution
transaction, the assets and liabilities of the Hudson River Trust
Portfolio that followed the same investment objectives as this
Portfolio. The information for each of the preceding periods is that
of the predecessor Hudson River Trust Portfolio. Information for the
year ended December 31, 1999 includes the results of operations of
the predecessor Hudson River Trust Portfolio from January 1, 1999
through October 17, 1999.
(e) Net investment income and capital changes per share are based on
monthly average shares outstanding.
(f) For further information concerning fee waivers see the section
entitled "Expense Limitation Agreement" in this Prospectus.
------------------------- EQ Advisors Trust
<PAGE>
10
Prior performance of each adviser
- -------
64 Prior performance of each adviser
- --------------------------------------------------------------------------------
The following table provides information concerning the historical performance
of another registered investment company (or series) and/or other
institutional private accounts managed by each Adviser that have investment
objectives, policies, strategies and risks substantially similar to those of
the respective Portfolio(s) of the Trust for which it serves as Adviser. The
data is provided to illustrate the past performance of the Advisers in
managing substantially similar investment vehicles as measured against
specified market indices. This data does not represent the past performance of
any of the Portfolios or the future performance of any Portfolio or its
Adviser. Consequently, potential investors should not consider this
performance data as an indication of the future performance of any Portfolio
of the Trust or of its Adviser and should not confuse this performance data
with performance data for each of the Trust's Portfolios, which is shown for
each Portfolio under the caption "ABOUT THE INVESTMENT PORTFOLIOS."
Each Adviser's performance data shown below for other registered investment
companies (or series thereof) was calculated in accordance with standards
prescribed by the SEC for the calculation of average annual total return
information for registered investment companies. Average annual total return
reflects changes in share prices and reinvestment of dividends and
distributions and is net of fund expenses. In each such instance, the share
prices and investment returns will fluctuate, reflecting market conditions as
well as changes in company-specific fundamentals of portfolio securities.
The performance results for the registered investment companies presented
below are generally subject to somewhat lower fees and expenses than the
relevant Portfolios although in most instances the fees and expenses are
substantially similar. In addition, holders of Contracts representing
interests in the Portfolios below will be subject to charges and expenses
relating to such Contracts. The performance results presented below do not
reflect any insurance related expenses and would be reduced if such charges
were reflected.
The investment results presented below are unaudited. For more information on
the specified market indices used below, see the section "The Benchmarks."
ANNUAL RATES OF RETURN OF OTHER FUNDS OR ACCOUNTS MANAGED BY ADVISERS AS
OF 12/31/99
The name of the other fund or account managed by the Adviser is shown in BOLD.
The name of the Trust Portfolio is shown in (parentheses). The name of the
benchmark is shown in italics.
<TABLE>
<CAPTION>
1 5
OTHER FUND OR ACCOUNT MANAGED BY ADVISER (EQAT Portfolio) Year Years
- ------------------------------------------------------------------------------------------ ----------- -----------
<S> <C> <C>
Benchmark
- ------------------------------------------------------------------------------------------
BT INSTITUTIONAL FUNDS - EQUITY 500 INDEX FUND - INSTITUTIONAL CLASS(8) (BT EQUITY 500 INDEX PORTFOLIO)
20.75% 28.46%
S&P 500 Index(1) 21.04% 28.56%
- ------------------------------------------------------------------------------------------ ----- -----
MERRILL LYNCH VARIABLE SERIES FUNDS, INC. - MERRILL LYNCH GLOBAL STRATEGY FOCUS FUND(8) (MERCURY WORLD STRATEGY
PORTFOLIO)
21.37% 13.11%
MSCI EAFE Index(3) 26.96% 12.83%
- ------------------------------------------------------------------------------------------ ----- -----
MFS EMERGING GROWTH FUND(4),(9) (MFS EMERGING GROWTH COMPANIES PORTFOLIO)
41.45% 28.05%
Russell 2000 Index(2) 21.26% 16.69%
- ------------------------------------------------------------------------------------------ ----- -----
<CAPTION>
10 Since Inception
OTHER FUND OR ACCOUNT MANAGED BY ADVISER (EQAT Portfolio) Years Inception Date
- ------------------------------------------------------------------------------------------ ----------- ----------- ------------
<S> <C> <C> <C>
Benchmark
- ------------------------------------------------------------------------------------------
BT INSTITUTIONAL FUNDS - EQUITY 500 INDEX FUND - INSTITUTIONAL CLASS(8) (BT EQUITY 500 INDEX PORTFOLIO)
N/A 21.45% 12/31/92
S&P 500 Index(1) N/A 21.53%
- ------------------------------------------------------------------------------------------ ----- -----
MERRILL LYNCH VARIABLE SERIES FUNDS, INC. - MERRILL LYNCH GLOBAL STRATEGY FOCUS FUND(8) (MERCURY WORLD STRATEGY
PORTFOLIO)
N/A 11.00% 2/28/92
MSCI EAFE Index(3) N/A 12.00%
- ------------------------------------------------------------------------------------------ ----- -----
MFS EMERGING GROWTH FUND(4),(9) (MFS EMERGING GROWTH COMPANIES PORTFOLIO)
24.72% N/A 12/29/86
Russell 2000 Index(2) 13.40% N/A
- ------------------------------------------------------------------------------------------ --------- -----
</TABLE>
<PAGE>
- -----
65 Prior performance of each adviser
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1 5 10 Since Inception
OTHER FUND OR ACCOUNT MANAGED BY ADVISER (EQAT Portfolio) Year Years Years Inception Date
- ----------------------------------------------------------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
MFS RESEARCH FUND(6),(8) (MFS RESEARCH PORTFOLIO)
16.70% 24.43% 17.53% N/A 10/13/71
S&P 500 Index(1) 21.04% 28.56% 18.21% N/A
T. ROWE PRICE EQUITY INCOME FUND8 (T. ROWE PRICE EQUITY INCOME PORTFOLIO)
3.82% 18.59% 14.14% 15.67% 10/31/85
S&P 500 Index(1) 21.04% 28.51% 18.21% N/A
- ----------------------------------------------------------- ----- ----- ----- -----
WARBURG PINCUS SMALL COMPANY VALUE FUND(9) (WARBURG PINCUS SMALL COMPANY VALUE PORTFOLIO)
7.55% N/A N/A 14.21% 12/29/95
Russell 2000 Value Index(7) (1.49)% N/A N/A 10.19%
</TABLE>
1 The S&P 500 Index ("S&P 500") is an unmanaged index containing common
stocks of 500 industrial, transportation, utility and financial companies,
regarded as generally representative of the larger capitalization portion
of the United States stock market. The S&P 500 reflects the reinvestment of
income dividends and capital gain distributions, if any, but does not
reflect fees, brokerage commissions, or other expenses of investing.
2 The Russell 2000 Index is an unmanaged index (with no defined investment
objective) composed of approximately 2,000 small-capitalization stocks and
includes reinvestments of dividends. The index does not include fees or
operating expenses and is not available for actual investment. It is
compiled by the Frank Russell Company.
3 The Morgan Stanley Capital International EAFE Index ("EAFE Index") is an
unmanaged capitalization-weighted measure of stock markets in Europe,
Australasia and the Far East. The returns of the EAFE Index assume
dividends are reinvested net of withholding tax and do not reflect any fees
or operating expenses. The index is not available for actual investment.
4 The results for the MFS Emerging Growth Fund (Class B shares) do not
reflect sales charges that may be imposed on the such shares.
5 Annualized performance for the Advisor Class shares. The Advisor Class
shares had a total expense ratio of 1.26% of its average daily net assets
for the year ended December 31, 1998. Other share classes have different
expenses and their performance will vary.
6 Performance for the Class A shares. The Class A shares are in many
instances subject to a front-end sales charge of up to 5.75%. Other share
classes have different expenses and their performance will vary.
7 The Russell 2000 Value Index ("Russell 2000 Value") ia an unmanaged index
which measures the performance of those Russell 2000 companies with lower
price-to-book ratios and lower forecasted growth values. It is compiled by
the Frank Russell Company.
8 The annual fees and expenses of the similar registered investment company
(or series thereof) (or composite) whose prior performance is shown in the
table above were less than that of the relevant Trust Portfolio.
Consequently, if the Trust Portfolio's annual fees and expenses were used
in the calculation of the performance of the similar registered investment
company (or composite) that performance would be reduced.
9 The annual fees and expenses of the similar registered investment company
(or series thereof) (or composite) whose prior performance is shown in the
table above were higher than that of the relevant Trust Portfolio.
Consequently, if the Trust Portfolio's annual fees and expenses were used
in the calculation of the performance of the similar registered investment
company (or composite) that performance would be increased.
------------------------- EQ Advisors Trust
<PAGE>
- ----------------
66
- --------------------------------------------------------------------------------
If you wish to know more, you will find additional information about the Trust
and its Portfolios in the following documents, which are available, free of
charge by calling our toll-free number at 1-800-528-0204:
ANNUAL AND SEMI-ANNUAL REPORTS
The Annual and Semi-Annual Reports include more information about the Trust's
performance and are available upon request free of charge. The reports usually
include performance information, a discussion of market conditions and the
investment strategies that affected the Portfolios' performance during the last
fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
The SAI, dated May 1, 2000, is incorporated into this Prospectus by reference
and is available upon request free of charge by calling our toll free number at
1-800-528-0204.
You may visit the SEC's website at www.sec.gov to view the SAI and other
information about the Trust. You can also review and copy information about the
Trust, including the SAI, at the SEC's Public Reference Room in Washington, D.C.
or by electronic request at [email protected] or by writing the SEC's Public
Reference Section, Washington, D.C. 20549-0102 You may have to pay a duplicating
fee. To find out more about the Public Reference Room, call the SEC at
1-202-942-8090.
Investment Company Act File Number: 811-07953
