NATIONWIDE MUTUAL FUNDS, 497, 2000-03-08

NATIONWIDE MUTUAL FUNDS
497, 2000-03-08

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<PAGE> 1

MORLEY CAPITAL ACCUMULATION FUND
(Service Class, Institutional Class and IRA Class Shares)

PROSPECTUS

March 1, 2000

2000
As with all mutual funds,
the Securities and Exchange
Commission has not approved
or disapproved this fund's
shares as an investment or
determined whether this
prospectus is complete or
accurate. To state
otherwise is a crime.

[ ]NATIONWIDE(R)
Family of Funds
<PAGE> 2

FUND SUMMARY
This prospectus provides information about the Morley Capital Accumulation Fund
(the Fund), a series of the Nationwide(R) Mutual Funds. "You" and "your" refers
to potential investors and current shareholders of the Fund.

A QUICK NOTE ABOUT SHARE CLASSES

The Fund has three different share classes -- Service Class (formerly
Institutional Service Class), Institutional Class and IRA Class. The fees and
expenses for each share class are different, but each share class of the Fund
represents an investment in the same assets of the Fund. Having different share
classes simply lets you choose the cost structure that's right for you.

The fees and expenses for the Fund are set forth in the Fund Summary. For more
information about which share class is right for you, see "Buying and Selling
Fund Shares -- Choosing a Share Class" beginning on page eight.

2
<PAGE> 3

This section summarizes key information about the Fund. Use the summary to
compare the Fund with other mutual funds. More detailed information about the
risks and investment techniques of the Fund can be found in "More About the
Fund" beginning on page five.

OBJECTIVES AND PRINCIPAL STRATEGIES

The Fund seeks to provide a high level of current income while preserving
capital and maintaining a stable net asset value per share. The Fund's
investment objectives can be changed without shareholder approval.

To achieve its goals, under normal conditions, the Fund invests primarily in
securities issued by the U.S. Government and its agencies, as well as high-grade
debt securities issued by corporations. The Fund also purchases mortgage-backed
and asset-backed securities. The debt securities in which the Fund invests pay
interest on either a fixed-rate or variable-rate basis. The Fund has entered
into book value maintenance agreements ("wrap contracts") with one or more
highly rated financial institutions for the purpose of maintaining the Fund's
assets at a stable net asset value. The Fund will be managed so that the
duration of its securities will be between 2.0 and 3.5 years. The use of wrap
contracts is intended to effectively reduce the overall duration of the Fund to
zero.

Duration is the sensitivity of the net asset value of
the Fund to changes in interest rates.

When selecting securities for the Fund, the Fund's portfolio managers will
consider expected changes in interest rates and in the price relationships among
various types of securities. They will attempt to identify and purchase
securities offering the best combination of yield, maturity and relative price
performance. The Fund's portfolio managers may elect to sell securities in order
to buy others which they believe will better serve the objectives of the Fund.

HIGH GRADE DEBT SECURITIES include corporate bonds and
other debt securities that have been rated within the
two highest rating categories by a nationally
recognized rating organization (rating agency) such as
Standard & Poor's Rating Group or Moody's Investor
Services, Inc. The rating agency evaluates a debt
security, measures the issuer's financial condition
and stability and assigns a rating to the security. By
measuring the issuer's ability to pay back the debt,
ratings help investors evaluate the safety of their
debt investments.

The Fund's portfolio managers expect that careful selection of securities and
the use of wrap contracts will enable the Fund to meet its investment objective
of a constant net asset value per share, although there can be no guarantee that
the Fund will meet its objective.

PRINCIPAL RISKS

Because the value of the Fund will fluctuate, there is the risk that a
shareholder will lose money if the Fund cannot enter into wrap contracts
covering all its assets or if the value of the Fund's wrap contracts otherwise
becomes impaired.

CREDIT RISK. Credit risk is the risk that the issuer of a debt security will be
unable to make the required payments of interest and/or repay principal when
due. In addition, there is a risk that the rating of a debt security may be
lowered if an issuer's financial condition changes, which may lead to a greater
price fluctuation in the securities the Fund owns. The Fund limits this risk by
purchasing high-grade debt securities.

INTEREST RATE RISK. Interest rate risk is the risk that increases in market
interest rates may decrease the value of debt securities held by the Fund. In
general, the prices of debt securities fall when interest rates increase and
rise when interest rates decrease. Typically, the longer the maturity of a debt
security, the more sensitive it is to price shifts as a result of interest rate
changes. The Fund's use of wrap contracts is intended to eliminate the direct
impact of interest rate risk on the Fund's net asset value by offsetting any
fluctuation in the value of securities held by the Fund caused by changes in
interest rates. However, there can be no assurance that the Fund's use of wrap
contracts will be effective, and changes in interest rates may still impact the
current yield of the Fund.

PREPAYMENT AND EXTENSION RISK. The issuers of mortgage-and asset-backed
securities may be able to repay principal in advance, and are especially likely
to do so when interest rates fall. Changes in prepayment rates can make the
price and yield of mortgage- and asset-backed securities volatile. When
mortgage- and asset-backed securities are prepaid, the Fund may also fail to
recover premiums paid for the securities, resulting in an unexpected capital
loss, and the Fund may have to invest the proceeds from the repayments at lower
rates. In addition, rising interest rates may cause prepayments to occur at a
slower than expected rate thereby effectively lengthening the maturity of the
securities and making them more sensitive to interest rate changes. Extension
risk is the risk that anticipated payments on principal may not occur, typically
because of a rise in interest rates, and the expected maturity of the security
will increase. During periods of rapidly rising interest rates the anticipated
maturity of a security may be extended past what the portfolio manager
anticipated, affecting the maturity and volatility of the Fund. Under normal
conditions, the Fund's use of wrap contracts is expected to offset the effects
of prepayment and extension risk on the Fund's net asset value. However, there
can be no assurance that the Fund's use of wrap contracts will be effective to
eliminate prepayment risks. In addition, prepayments may affect the current
yield of the Fund.

3
<PAGE> 4

Fund Summary

RISK OF USING WRAP CONTRACTS. The Fund is subject to risks associated with its
use of wrap contracts and their providers. The Fund may be unable to cover all
of its securities with wrap contracts. Alternatively, the credit standing of
certain wrap contract providers may deteriorate over time, impairing the value
of their contracts, and the Fund may be unable to renegotiate, replace, or
provide for successor contracts in a timely or economical manner. If either or
both of these events were to occur, the duration of the Fund could be affected,
and the net asset value of the Fund could be subject to increased fluctuation.

LIQUIDITY RISK. Liquidity risk is the risk that a debt security that the Fund
purchases cannot be sold, or cannot be sold quickly, at an acceptable price. The
Fund will limit liquidity risk by investing primarily in relatively short-term,
high-grade securities, and by maintaining a reasonable cash balance to fund
redemptions and investment purchase opportunities.

For more detailed information about the Fund's investments and risks, see "More
About the Fund" beginning on page five.

PERFORMANCE

No performance information is provided because the Fund has not yet had a full
calendar year of operations.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
selling shares of the Fund.

<TABLE>
<CAPTION>
Institutional
Shareholder Fees(1) Service Class IRA Class
(paid directly from your investment) Class shares shares shares
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Redemption Fee (as a percentage of 2.00% 2.00% 2.00%
the amount redeemed)(2)
</TABLE>

<TABLE>
<CAPTION>
Institutional
Annual Fund Operating Expenses Service Class IRA Class
(deducted from fund assets) Class shares shares shares
- -------------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.35% 0.35% 0.35%
.........................................................................
Distribution and/or Service 0.25% None 0.25%
(12b-1) Fees
.........................................................................
Other Expenses 5.50% 3.83% 4.05%
- -------------------------------------------------------------------------
TOTAL ANNUAL FUND OPERATING 6.10% 4.18% 4.65%
EXPENSES(3)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or agent, they may also charge
you a transaction fee.

(2) You will be charged a redemption fee equal to 2% of the amount you redeem if
the Fund Protection Trigger (Trigger) is active the day your redemption
order is received by the Fund. See "Selling Shares -- Redemption fees" on
page 10 to determine when the Trigger is considered to be active.

(3) At least through October 31, 2000, Union Bond & Trust Company (UBT) has
agreed to waive fees or otherwise reimburse expenses for the Fund so that
the Total Annual Operating Expenses will not exceed 0.95% for ISC shares,
0.55% for IC shares, and 0.95% for IRA shares. This waiver of fees and
reimbursement of expenses is subject to a possible reimbursement of UBT by
the Fund within three years of the Fund's commencement of operations if the
reimbursement by the Fund can be implemented within the annual expense
limitations described above.

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the cost of this Fund with other mutual funds.

The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. No redemption fee is included because it is anticipated that the
trigger will not generally be active. Although your actual costs may be higher
or lower, based on these assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Service Class shares $607 $1,800 $2,967 $5,775
...............................................................
Institutional Class
shares $420 $1,269 $2,133 $4,355
...............................................................
IRA Class shares $466 $1,402 $2,345 $4,732
</TABLE>

4
<PAGE> 5

MORE ABOUT THE FUND

PRINCIPAL INVESTMENTS AND TECHNIQUES

The Fund may use the following investments and techniques to increase its
returns, protect its assets or diversify its investments. The techniques are
subject to certain risks. For additional information about the Fund's investment
strategies and techniques, see the Statement of Additional Information (SAI).

U.S. GOVERNMENT SECURITIES. These securities include Treasury bills, notes and
bonds issued or guaranteed by the U.S. Government and securities issued by U.S.
Government agencies, including:

- The Federal Housing Administration, the Farmers Home Administration, and the
Government National Mortgage Association (GNMA), including GNMA pass-through
certificates, which are backed by the full faith and credit of the United
States government;

- The Federal Home Loan Banks;

- The Federal National Mortgage Association (FNMA);

- The Student Loan Marketing Association and Federal Home Loan Mortgage
Corporation (FHLMC); and

- The Federal Farm Credit Banks.

Although there is virtually no credit risk with these U.S. government
securities, neither the U.S. Government nor its agencies guarantee the market
value of their securities. Interest rate changes, prepayment and other factors
may affect the value of these securities.

MORTGAGE-BACKED AND ASSET-BACKED SECURITIES. U.S. Government mortgage-backed
securities are securities that are secured by and paid from a pool of mortgage
loans on real property and issued or guaranteed by the U.S. Government or one of
its agencies. Mortgage-backed securities may also be issued by private issuers.
Collateralized mortgage obligations (CMOs) are securities that have mortgage
loans or mortgage pass-through securities, such as GNMA, FNMA or FHLMC
certificates, as their collateral. CMOs can be issued by the U.S. Government or
its agencies or by private lenders.

These securities are subject to interest rate risk and prepayment risk. These
securities are also subject to credit risk if they are issued by private
issuers. With respect to prepayment risk, when interest rates fall, homeowners
may refinance their loans and mortgage-backed securities may be paid off sooner
than anticipated. Reinvesting the returned principal in a lower interest rate
market would reduce the Fund's income. Mortgage-backed securities are also
subject to extension risk as described above if rates increase and prepayments
slow, and the possibility of losing principal as a result of faster than
anticipated prepayment of securities purchased at a premium.

Asset-backed securities are securities that are secured by and paid from a pool
of underlying assets, such as automobile installment sales contracts, home
equity loans, property leases and credit card receivables. Asset-backed
securities are generally issued by private issuers and are also subject to
interest rate, credit, prepayment and extension risks.

FLOATING AND VARIABLE RATE SECURITIES. Floating- and variable-rate securities
are securities that do not have fixed interest rates; the rates change
periodically. The interest rate on floating-rate securities varies with changes
in the underlying index (such as the Treasury bill rate), while the interest
rate on variable-rate securities changes at preset times based upon the
underlying index. Some of the floating- or variable-rate securities will be
callable by the issuer, which means they can be paid off before their stated
maturity date.

These securities are subject to interest rate risk like other securities. They
are also subject to basis risk, which is the risk that the value of the security
may deteriorate relative to the underlying index. In addition, because they may
be callable, these securities are also subject to the risk that they will be
repaid prior to their stated maturity and that the repaid principal will be
reinvested in a lower interest rate market, reducing the Fund's income. The Fund
will only purchase floating- and variable-rate securities of the same quality as
the securities it would otherwise purchase.

WRAP CONTRACTS. Wrap contracts cover certain assets of the Fund and are intended
to reduce or eliminate the volatility of the Fund's net asset value. A wrap
contract is an agreement between the Fund and a financial institution, typically
a highly rated bank or insurance company (a wrap provider), to maintain certain
Fund assets at their purchase price plus accrued interest. Under normal
circumstances, the value of a wrap contract is the difference between the
aggregate book value and the current market value of covered assets. A wrap
contract therefore gains value when the market price of covered assets declines,
and decreases in value when the market price of the covered assets increases.
The Fund expects to pay an annual premium of between 0.10% and 0.23% on the book
value of assets in the Fund that are covered by wrap contracts.

5
<PAGE> 6

MORE ABOUT THE FUND

Wrap contracts are considered illiquid assets of the Fund. In addition to
liquidity risk, wrap contracts are subject to the credit risk of the wrap
provider, and also to the risk that the Fund may be unable to replace a wrap
contract that is maturing or subject to termination. Although wrap contracts are
designed to reduce the volatility of the Fund's net asset value, they may not
always be able to do so.

TEMPORARY DEFENSIVE POSITIONS

In response to economic, political or unusual market conditions, the Fund may
invest up to 100% of its assets in cash or money market obligations. Should this
occur, the Fund will not meet its investment objectives, and may miss potential
market upswings.

6
<PAGE> 7

MANAGEMENT

INVESTMENT ADVISER

Union Bond & Trust Company (UBT), 5665 S.W. Meadows Road, Lake Oswego, Oregon
97035, manages the investment of the assets and supervises the daily business
affairs of the Fund. UBT is a state bank and trust company chartered in 1913 and
reorganized in 1992 under the laws of the state of Oregon. UBT provides a range
of investment and fiduciary services to institutional clients. UBT maintains and
manages common and pooled trust funds invested primarily in fixed income assets
whose principal value is believed to be relatively stable. As of December 31,
1999, UBT and its affiliates had approximately $9.5 billion in assets under
management.

The Fund pays UBT an annual management fee which is based on the Fund's average
daily net assets. The total fee paid by the Fund for the fiscal period ended
October 31, 1999, expressed as a percentage of the Fund's average daily net
assets, was 0.25%

PORTFOLIO MANAGERS

Taylor E. Drake and Thomas F. Mitchell have co-managed the Fund since it began
operations in February 1999.

Mr. Drake, Vice President and Portfolio Manager of Morley Capital Management,
Inc. (MCM), an affiliate of UBT, joined MCM in 1995 and has managed corporate
stable value portfolios since 1995 and the Morley Capital Accumulation Fund
since February 1999 when the fund began operations. Prior to joining MCM in
1995, he was Associate Director of Investment Banking at US Bancorp.

Mr. Mitchell, Senior Portfolio Manager of MCM joined MCM in 1999. He has managed
the Morley Capital Accumulation Fund since February 1999 when the fund began
operations. Mr. Mitchell has over twenty years' experience with taxable and
tax-exempt securities. From 1978 to 1996 he managed investment portfolios for
commercial bank affiliates of First Interstate Bancorp. In 1997 and 1998,
following First Interstate's merger with Wells Fargo & Co., he was a fixed
income trader with Wells Fargo's Institutional Securities Sales and Trading
Division.

7
<PAGE> 8

BUYING AND SELLING FUND SHARES

CHOOSING A SHARE CLASS

As noted in the Fund Summary, the Fund offers different share classes. Each
Class is available to a limited group of investors as described below. Service
Class and IRA shares pay distribution and/or service fees under a Distribution
Plan. These fees are either retained by Nationwide Advisory Services, Inc.
(NAS), the Fund's distributor, or paid by NAS to brokers for distribution and
shareholder services. Service Class and IRA shares also pay administrative
service fees. These fees are paid to brokers and other entities that provide
administrative support services to the beneficial owners of the shares.

WHO CAN BUY SERVICE CLASS OR INSTITUTIONAL CLASS SHARES

In order to purchase Service Class or Institutional Class shares, a shareholder
must be one of the following:

- employee benefit plans qualified under Section 401(a) of the Internal Revenue
Code

- governmental plans as defined in Section 414(d) of the Internal Revenue Code

- eligible deferred compensation plans as defined in Section 457 of the
Internal Revenue Code

- employee benefit plans qualifying under Section 403(b) of the Internal
Revenue Code

- bank maintained collective investment funds that exclusively hold assets of
U.S. employee benefit plans qualified under Section 401(a) of the Internal
Revenue Code and are tax exempt under Section 501(a) of the Internal Revenue
Code

- other plans eligible to invest in bank-maintained collective funds

Service Class shares can also be purchased by life insurance company separate
accounts to fund the benefits of variable insurance contracts.

In addition, Institutional Class shares are only available for purchase if the
institutional investor or any third party associated with such investor does not
receive or require any compensation in the form of administrative service or
Rule 12b-1 fees.

Qualified (or other retirement) plan -- or contract-directed -- purchases,
exchanges and redemptions are handled in accordance with terms of the retirement
plans or variable insurance contracts, subject to Fund restrictions contained
herein. Since the retirement plans or variable insurance contracts may have
different provisions with respect to the timing and method of purchases,
exchanges and redemptions, beneficial owners of the Service Class shares should
contract their designated financial intermediary directly for details concerning
transactions.

To be eligible to purchase shares of the Fund, the plan or other institution
must restrict individual participants from transferring assets from the Fund to
another fixed income investment option which has a targeted average duration of
three years or less or which seeks to maintain a stable value (a Competing
Fund). Alternatively, if a Competing Fund is an option for participant
transfers, participants must be required to transfer assets to an investment
option which is not a Competing Fund for a period of at least 90 days before the
assets can be transferred into a Competing Fund.

WHO CAN BUY IRA CLASS SHARES

IRA shares are offered to investors who wish to purchase the Fund's shares
through an individual retirement account (as defined in Sections 408 and 408A of
the Code), including a traditional IRA, SEP-IRA, ROTH IRA, SIMPLE IRA, an
education IRA and a KEOGH plan.

8
<PAGE> 9

BUYING SHARES

PURCHASE PRICE. The purchase or "offering" price of one share of the Fund is
its "net asset value" (NAV) next determined after the order is received. No
sales charge is imposed on the purchase of any class of the Fund's shares. A
separate NAV is calculated for each class of shares of the Fund. Generally, NAV
is based on the market value of the securities owned by the Fund less its
liabilities. The NAV for a class is determined by dividing the total market
value of the securities owned by the Fund allocable to such class, less the
liabilities allocable to that class, by the total number of that class'
outstanding shares. NAV is determined at the close of regular trading on the
New York Stock Exchange (usually 4 p.m. Eastern Time) on each day the Exchange
is open for trading.

The Fund does not calculate NAV on the following days:

- Christmas Day
- New Year's Day
- Martin Luther King, Jr. Day
- Presidents' Day
- Good Friday
- Memorial Day
- Independence Day
- Labor Day
- Thanksgiving Day
- Other days when the New York Stock Exchange is not open.

The Fund reserves the right not to determine an NAV for the Fund when

- It has not received any orders to purchase, sell or exchange shares.

- Changes in the value of Fund's portfolio do not affect the NAV.

If current market prices are not available, or if Villanova SA Capital Trust
(VSA), as the Fund's administrator or its agent, determines a price does not
represent fair value, the Fund's investments may be valued at fair market value
in accordance with procedures adopted by the Board of Trustees. Wrap contracts
are valued at fair value in accordance with procedures adopted by the Board of
Trustees of the Trust. To the extent that the Fund's investments are traded in
market that are open when the New York Stock Exchange is closed, the value of
the Fund's investments may change on days when shares cannot be purchased or
redeemed.

HOW TO PLACE YOUR PURCHASE ORDER

Eligible entities wishing to purchase Service Class or Institutional Class
shares should contact NAS at 1-800-848-0920 for information regarding such
purchases.

If you wish to purchase IRA Class shares, you may purchase the shares using one
of the methods below.

BY MAIL -- Complete and mail the application with a check or money order made
payable to: Nationwide Advisory Services, Inc., P.O. Box 1492, Columbus, Ohio
43216-1492. Payment must be made in U.S. dollars only and drawn on a U.S. bank.
NAS will not accept third-party checks.

BY WIRE -- You can request that your bank transmits funds (federal funds) by
wire to the Fund's custodian bank. In order to use this method, you must call
NAS by 4 p.m. Eastern Time, and the wire must be received by the custodian bank
by the close of business on the day you placed your order or your order will be
cancelled. You may be liable for any loss to the Fund resulting from the
cancellation. Please note that your bank may charge a fee to wire the funds. If
you choose this method to open your account, you must call our toll-free number
before you wire your investment, and you must then complete and fax the
application.

THROUGH AN AUTHORIZED BROKER -- NAS has relationships with certain brokers or
other financial intermediaries who are authorized to accept, or designate
intermediaries to accept,

MINIMUM INVESTMENTS --
SERVICE CLASS
To open an account $100,000
.....................................................
Additional investments None
MINIMUM INVESTMENTS --
INSTITUTIONAL CLASS
To open an account $1,000,000
.....................................................
Additional investments None
MINIMUM INVESTMENTS --
IRA CLASS
To open an account $2,000
($500 for Education IRA's)
.....................................................
Additional investments $500
--------------------------------------------------------------
These minimum investment requirements may not apply to
certain retirement plans. Call 1-800-848-0920 for more
information. If you purchase shares through an account
at a broker (other than NAS), different minimum
account requirements may apply. [INSET BOX]

9
<PAGE> 10
Buying and Selling Fund Shares

purchase and redemption orders for the Fund. If you purchase through such a
broker, your order will be priced at the NAV next determined after your broker
or its designated intermediary accepts it. Contact your broker to determine
whether it has an established relationship with NAS.

ADDITIONAL SHAREHOLDER SERVICES

Shareholders are entitled to a wide variety of services by contacting:

NATIONWIDE CUSTOMER SERVICE 1-800-848-0920

Representatives are available to answer questions between 8 a.m. and 5 p.m.
Eastern Time (Monday through Friday, except Thursday, in which case
representatives are available between 9:30 a.m. and 5 p.m. Eastern Time).

For additional information on buying shares and shareholder services, call the
customer service number listed above or contact your sales representative.

SELLING SHARES

You can sell -- also known as redeeming -- your shares of the Fund at any time,
subject to certain restrictions described below. The price you will receive
when you sell your shares will be the NAV (less any applicable redemption fee
as described below) next determined after NAS receives your properly completed
order to sell in its offices in Columbus, Ohio. Although the Fund attempts to
maintain a stable net asset value, the value of the shares you sell may be
worth more or less than their original purchase price depending upon the market
value of the Fund's investments at the time of sale. Your order to sell shares
can be made in writing or by telephone (if you authorized telephone
transactions on your application). Generally, we will pay you for shares that
you sell within three days after receiving your order to sell.

Properly completed orders contain all necessary paperwork to authorize and
complete the transaction. NAS may require all account holder signatures,
updated account registration and bank account information and, depending on
circumstances, a signature guarantee. [INSET BOX]

Payment for shares you recently purchased by check may be delayed until the
check clears, which may take up to 10 business days from the date of your
purchase.

If you request to sell Service Class or Institutional Class shares in an amount
exceeding $250,000 or 1% of the net asset value of the Fund, under extraordinary
circumstances the Fund may elect to honor your request by transferring some of
the securities held by the Fund directly to you. For more information about the
Fund's ability to make such a redemption in kind, see the Fund's Statement of
Additional Information.

RESTRICTIONS ON SALES

You may not be able to sell your shares of the Fund or the Fund may delay paying
you the proceeds from a sale when the New York Stock Exchange is closed (other
than customary weekend and holiday closings) or if trading is restricted or if
an emergency exists.

SIGNATURE GUARANTEE -- IRA CLASS SHARES

A signature guarantee is required under the following circumstances:

- if redemption is over $100,000,
- if your account registration has changed within the last 30 days,
- if the redemption check is made payable to anyone other than the registered
shareholder,
- if the proceeds are sent back to a bank account not previously designated or
changed within the past 30 days, or
- if the proceeds are mailed to an address other than the address of record.

NAS reserves the right to require a signature guarantee in other circumstances,
without notice.

REDEMPTION FEES

There is no redemption fee if you request a redemption of shares when the
Trigger is not active. If you request a redemption of shares when the Trigger is
active, generally a 2% redemption fee will be deducted from your proceeds and
retained by the Fund. The Trigger is "active" if the current yield of the Dealer
Commercial Paper (90-day) Index (the Index) (as measured two business days
before your request is received by NAS) exceeds the annualized gross yield of
the Fund. The Index is printed daily in The Wall Street Journal. Once activated,
the Trigger remains active until the gross yield of the Fund (as measured two
business days before your request is received by NAS) exceeds the yield of the
Index plus 0.25%.

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<PAGE> 11

Even if the Trigger is "active," your redemption proceeds will not be subject to
the 2% redemption fee if, with respect to Service Class or Institutional Class
shares, your redemption is due to:

- death, disability, retirement, employment termination, loans, hardships or
other withdrawals permitted by the terms of your employee benefit plan; or
- an exchange of your shares for an investment in an investment option that is
not considered a Competing Fund.

The Fund uses redemption fees to help minimize the impact that redemptions may
have on its performance and to cover a portion of the Fund's related
administrative costs. Redemption fees may also discourage market timing by
shareholders initiating redemptions to take advantage of short-term movements in
interest rates.

For more information about the redemption fee and whether your redemption
request may be subject to such fee, call NAS at 1-800-848-0920.

HOW TO PLACE YOUR SALE ORDER

You can request the sale of your IRA Class shares in any of the ways described
below. Signature guarantee may be required under certain circumstances. Please
refer to the section entitled "Signature Guarantee -- IRA Class Shares" on page
10. Eligible entities wishing to sell Service Class or Institutional Class
shares should contact NAS at 1-800-848-0920 for information regarding such
sales.

CUSTOMER SERVICE LINE -- Unless you declined the telephone redemption privilege
on your application, you can call and request that a check payable to the
shareholder of record be mailed to the address of record. You can sell shares of
your IRA by telephone if we receive the proper forms. The distribution from an
IRA will be subject to a mandatory 10% federal withholding tax, unless you
inform us in writing not to withhold taxes. For additional information or to
request the forms, please call the customer service line at 1-800-848-0920. The
Fund will use procedures to confirm that telephone instructions are genuine. If
the Fund acts on instructions it reasonably believed were genuine, it will not
be liable for any loss, injury, damage or expense that occurs as a result, and
the Fund will be held harmless for any loss, claims, or liability arising from
its compliance with the instructions. NAS may record telephone instructions to
sell shares. The Fund reserves the right to revoke this privilege at any time,
without notice to shareholders, and to request the sale in writing, signed by
all shareholders on the account.

BY BANK WIRE -- NAS can wire the funds directly to your account at a commercial
bank (a voided check must be attached to your application) unless you declined
telephone privileges on your application. (This authorization will remain in
effect until you give NAS written notice of its termination.) Your funds will be
wired to your bank on the next business day after your order to sell shares has
been processed. We will deduct a $20 fee from the proceeds of your sale for this
service. Your financial institution may also charge you a fee for receiving the
wire. Funds sent outside the U.S. may be subject to a higher fee.

BY AUTOMATED CLEARING HOUSE (ACH) -- Your funds can be sent to your bank via ACH
on the second business day after your order to sell has been reviewed by NAS.
Funds sent through ACH should reach your bank in two business days. There is no
fee for this service. (This authorization will remain in effect until you give
NAS written notice of its termination.)

BY MAIL OR FAX -- Write a letter to Nationwide Advisory Services, Inc., P.O. Box
1492, Columbus, Ohio 43216-1492 or fax it to 614-249-8705. Please be sure your
letter is signed by all account owners. Be sure to include your account number
and the Fund from which you wish to make a redemption. For a distribution from
an IRA, you must include your date of birth and indicate whether or not you want
NAS to withhold federal income tax from your proceeds. Your sale of shares will
be processed on the date NAS receives your signed letter or fax. If your fax is
received after 4 p.m. Eastern Time, it will be processed the next business day.
NAS reserves the right to require the original document if you fax your letter.

THROUGH AN AUTHORIZED BROKER -- NAS has relationships with certain brokers and
other financial institutions who are authorized to accept, or designate
intermediaries to accept, purchase and redemption orders for the Fund. If you
have an account with such a broker, your redemption order will be priced at the
NAV next determined after your order has been accepted by your broker or its
designated intermediary. Your broker or financial intermediary may charge a fee
for this service.

11
<PAGE> 12

Buying and Selling Fund Shares

ACCOUNTS WITH LOW BALANCES -- IRA CLASS SHARES

NAS may sell the rest of your shares and close your account if you make a sale
that reduces the value of your account to less than $2,000 ($500 for Education
IRAs). Before the account is closed, we will give you notice and allow you 90
days to purchase additional shares to avoid this action. We do this because of
the high cost of maintaining small accounts. This does not apply to Automatic
Asset Accumulation accounts.

For additional information concerning your ability to sell your shares, call our
customer service line at 1-800-848-0920 or see your sales representative.

DISTRIBUTION PLAN

The Trust has adopted a Distribution Plan under Rule 12b-1 of the Investment
Company Act, which permits the Service Class and IRA Class shares of the Fund to
compensate NAS -- as distributor -- for expenses associated with distributing
its shares and providing shareholder services.

DISTRIBUTION AND SERVICE FEES

Under the Distribution Plan, the IRA Class and Service Class shares of the Fund
pay NAS compensation accrued daily and paid monthly. Service Class and IRA Class
shares pay an amount, not exceeding on an annual basis, 0.25% (distribution or
service fee) of the Class' average daily net assets.

Because these fees are paid out of the Fund's assets on an ongoing basis, over
time these fees will increase the cost of your investment and may cost you more
than paying other types of sales charges.

12
<PAGE> 13

DISTRIBUTIONS AND TAXES

The following information is provided to help you understand the income and
capital gains you can earn from owning Fund shares, as well as the federal taxes
you may have to pay on this income. For tax advice regarding your personal tax
situation, please speak with your tax adviser.

DISTRIBUTIONS OF INCOME AND CAPITAL GAINS

The Fund declares dividends of any available income daily and distributes them
monthly. If the Fund has net realized capital gains at the end of the fiscal
year (meaning the gains from sale of securities exceed any losses from sales),
it will distribute this capital gain to shareholders annually.

TAX STATUS

If you use the Fund as an investment option under a qualified employee benefit
plan or retirement plan or through some other tax-deferred account, dividend and
capital gain distributions from the Fund generally are not currently subject to
federal income taxes. In general, the entities eligible to purchase the Fund's
shares are governed by complex tax rules. You should ask your own tax adviser or
plan administrator about your own tax situation, including possible state and
local taxes.

Please refer to the SAI for more information regarding the tax treatment of the
Fund.

13
<PAGE> 14

FINANCIAL HIGHLIGHTS

The financial highlights table is intended to help you understand the Fund's
financial performance for the period of the Fund's operation. Certain
information reflects financial results for a single Fund share. The total
returns in the tables represent the rate that an investor would have earned or
lost on an investment in the Fund (assuming reinvestment of all dividends and
distributions). This information has been audited by KPMG LLP, whose report,
along with the Fund's financial statements, are included in the annual report,
which is available upon request.

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
-------------------------------------------
SERVICE CLASS INSTITUTIONAL IRA CLASS
SHARES(B) CLASS SHARES SHARES
------------- ------------- ---------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $10.00 $10.00 $10.00
Net investment income 0.35 0.38 0.35
Dividends from net investment income (0.35) (0.38) (0.35)
Net increase in net asset value -- -- --
------ ------ ------
NET ASSET VALUE -- END OF PERIOD $10.00 $10.00 $10.00
====== ====== ======
Total Return 3.60% 3.91% 3.60%
Ratios and supplemental data:
Net Assets, end of period (000) $1,051 $5,131 $1,829
Ratio of expenses to average net assets (c) 0.95% 0.55% 0.95%
Ratio of expenses to average net assets* (c) 6.10% 4.18% 4.65%
Ratio of net investment income to average net assets (c) 4.74% 5.17% 4.77%
Ratio of net investment income to average net assets* (c) (0.41%) 1.54% 1.07%
Portfolio turnover (d) 8.20% 8.20% 8.20%
</TABLE>

- ---------------
* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Fund commenced operations and all three Classes of Shares were offered
first February 1, 1999.

(b) Institutional Service Class shares were renamed Service Class shares as of
March 1, 2000.

(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

14
<PAGE> 15

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 16

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 17

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 18

INFORMATION FROM NATIONWIDE

Please read this Prospectus before you invest, and keep it with your records.
The following documents contain additional information about the Fund. To obtain
a document free of charge, contact us at the address or number listed below.

- - SAI (incorporated by reference in this Prospectus)

- - Annual Report (which contains a discussion of the market conditions and
investment strategies that significantly affect the Fund's performance) (as
available)

- - Semi-Annual Report (as available)

FOR ADDITIONAL INFORMATION CONTACT:

Nationwide Advisory Services, Inc.
P.O. Box 1492
Columbus, Ohio 43216-1492
(614) 249-8705 (fax)

Nationwide Logo

FOR INFORMATION, ASSISTANCE AND WIRE ORDERS:

1-800-848-0920 (toll free, 8 a.m. -- 5 p.m. Eastern Time (Monday through Friday,
except Thursday, in which case representatives are available between 9:30 a.m.
and 5 p.m. Eastern Time)).

INFORMATION FROM THE SECURITIES AND EXCHANGE COMMISSION

You can obtain copies of the Fund documents from the SEC as follows:

IN PERSON:

Public Reference Room in Washington, D.C. (For their hours of operation, call
1-202-942-8090.)

BY MAIL:

Securities and Exchange Commission
Public Reference Section
Washington, D.C. 20549-0102
(The SEC charges a fee to copy any documents.)

ON THE EDGAR DATABASE VIA THE INTERNET:

www.sec.gov

BY ELECTRONIC REQUEST:

[email protected]

INVESTMENT COMPANY ACT FILE NO. 811-08495

NATIONWIDE FAMILY OF FUNDS
THREE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215-2220

MOR-0003-A

<PAGE> 19

Nationwide(R) Money Market Fund
(Service Class Shares)

Prospectus

March 1, 2000

2000

As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved this fund's shares as an investment or determined
whether this prospectus is complete or accurate. To state otherwise is a crime.

[LOGO]
Nationwide(R)
Family of Funds
<PAGE> 20

TABLE OF CONTENTS

FUND SUMMARY.................................................................. 2

Objective..................................................................... 3

Principal Strategies.......................................................... 3
Principal Risks............................................................... 3
Performance................................................................... 3
Fees and Expenses............................................................. 4

MORE ABOUT THE FUND........................................................... 5

Principal Risks............................................................... 5

Non-Principal Risk............................................................ 5

Principal Investment Techniques............................................... 5

MANAGEMENT.................................................................... 6

Investment Adviser............................................................ 6

Portfolio Manager............................................................. 6

BUYING, SELLING AND EXCHANGING FUND SHARES.................................... 7

Buying Shares................................................................. 7

Selling Shares................................................................ 7

Distribution Plan............................................................. 7

Exchanging Shares............................................................. 8

DISTRIBUTIONS AND TAXES....................................................... 9

Distributions of Income Dividends............................................. 9

Distributions of Capital Gains................................................ 9

Tax Status.................................................................... 9

FINANCIAL HIGHLIGHTS......................................................... 10

ADDITIONAL INFORMATION.............................................. BACK COVER

1
<PAGE> 21

FUND SUMMARY
This prospectus provides information about the Nationwide Money Market Fund (the
Fund), a series of the Nationwide(R) Mutual Funds. "You" and "your" refers to
potential investors and current shareholders of the Fund.

A QUICK NOTE ABOUT SHARE CLASSES

The Fund has two different share classes, one of which is offered in this
Prospectus -- Service Class shares (formerly Class R shares). The fees, sales
charges and expenses for each share class are different, but each share class of
the Fund represents an investment in the same assets of the Fund. Having
different share classes simply lets you choose the cost structure that's right
for you.

The fees and expenses for the Fund are set forth below. For more information
about purchasing Service Class shares, see "Buying, Selling and Exchanging Fund
Shares -- Buying Shares" beginning on page seven.

2
<PAGE> 22

OBJECTIVE

The Fund seeks as high a level of current income as is consistent with the
preservation of capital and maintenance of liquidity.

PRINCIPAL STRATEGIES

The Fund seeks to achieve its investment objective by investing in high-quality
money market obligations maturing in 397 days or less, including corporate
obligations, U.S. Government and agency bonds, bills and notes, the obligations
of foreign governments, and the obligations of U.S. banks and U.S. branches of
foreign banks, if they are denominated in U.S. dollars. The Fund may also invest
in floating- and adjustable-rate obligations and asset-backed commercial paper
and may enter into repurchase agreements. Typically the Fund's dollar-weighted
average maturity will be 90 days or less.

WHY A MONEY MARKET FUND?

By investing in short-term corporate and government bonds and other debt
instruments, money market funds provide current income to investors and allow
easy access to their money. Money market funds are for risk-averse investors or
investors who want to earn competitive yields on cash they may need on short
notice. While the Money Market Fund pays dependable income, there is no
guarantee that the Fund's earnings will stay ahead of inflation or always
provide a certain level of income.

The Fund invests in securities which the portfolio manager believes to have the
best return potential. Because the Fund invests in short-term securities, it
will generally sell securities only to meet liquidity needs, to maintain target
allocations and to take advantage of more favorable opportunities.

PRINCIPAL RISKS

The Fund is a low-risk investment, compared with stock and bond funds, but it is
subject to the following risks.

CREDIT RISK. Credit risk is the risk that the issuer of a debt security will be
unable to make the required payments of interest and/or repay the principal when
due. This risk is significantly reduced due to the short-term nature of the debt
securities held by the Fund. In addition, there is a risk that the rating of a
debt security may be lowered if the issuer's financial condition changes. This
could lead to a greater fluctuation in the value of the Fund.

MONEY MARKET FUND RISK. Although the Fund's objective is to preserve capital,
there can be no guarantee that the Fund will be able to maintain a stable net
asset value of $1.00 per share; therefore you could lose money. Investments in
the Fund are not bank deposits and are not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency.

For additional information, see "More About the Fund" on page five.

PERFORMANCE

The following bar chart and table show two aspects of the Fund: volatility and
performance. The bar chart shows the volatility--or variability--of the Fund's
annual total returns over time and that fund performance can change from year to
year. The table shows the Fund's average annual total returns for certain time
periods compared to the returns of the Consumer Price Index. The bar chart and
table provide some indication of the risks of investing in the Fund.

Remember, however, that past performance does not guarantee similar results in
the future.

ANNUAL RETURNS: -- PRIME SHARES

<TABLE>

Best Quarter: 1.94% 1st qtr of 1990

Worst Quarter: 0.61% 2nd qtr of 1993

<TABLE>
<CAPTION>
One Five Ten
Average annual returns -- as of December 31, 1999(1) Year Years Years
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Prime Shares(2) 4.68% 5.07% 4.83%
................................................................................................
Consumer Price Index(3) 2.81% 2.39% 2.94%
</TABLE>

- ---------------

(1) Average total returns of the Prime Shares of the Fund shown are shown in the
bar chart and table since the Service Class shares had not yet operated a
full calendar year. The Prime Shares are offered in a separate prospectus.
Had the Service Class shares been offered during the periods shown, the
returns would have been similar to those shown since the shares are invested
in the same portfolio of securities; however the performance of Service
Class shares would have been lower as a result of their additional expenses.

(2) These returns reflect performance after expenses are deducted and includes
performance of its predecessor fund prior to May 11, 1998. Please call
1-800-637-0012 for the Fund's current 7-day yield.

(3) The Consumer Price Index represents changes in prices of basic goods and
services purchased for consumption by urban households.

3
<PAGE> 23

Fund Summary

FEES AND EXPENSES

This table describes the fees and expenses that a shareholder may pay when
buying and holding Service Class Shares of the Fund.

There are no sales charges to purchase or sell Service Class shares of the Fund.

<TABLE>
<CAPTION>
Annual Fund Operating Expenses
(deducted from Fund assets)
- -------------------------------------------------------
<S> <C>
Management Fees 0.40%
.......................................................
Distribution and Service (12b-1) Fees 0.15%
.......................................................
Other Expenses 0.24%
- -------------------------------------------------------
TOTAL ANNUAL FUND OPERATING EXPENSES 0.79%
</TABLE>

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the cost of this Fund with other mutual funds.

The example assumes that you invest $10,000 in Service Class shares of the Fund
for the time periods indicated and sells all shares at the end of those time
periods. It also assumes a 5% return each year and no changes in expenses.
Although your actual costs may be higher or lower, based on these assumptions
the cost would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
-------------------------------------
<S> <C> <C> <C>
$81 $252 $439 $978
</TABLE>

4
<PAGE> 24

MORE ABOUT THE FUND

PRINCIPAL RISKS

The Fund is a low-risk investment compared to most other investments. Given its
objective -- to preserve capital, generate income and maintain liquidity -- the
Fund invests in low-risk, high-quality securities. No investment, however, is
free of all risk. Any time an investor buys commercial paper or similar
obligations, there is credit risk and interest rate risk.

NON-PRINCIPAL RISK

LIQUIDITY RISK. Liquidity risk is the risk that a security cannot be sold, or
cannot be sold quickly, at an acceptable price. To the extent the Fund invests
in illiquid securities such as extendable commercial notes (whose maturity may
be extended to up to 390 days at the option of the issuer), it is subject to
this risk. The Fund will limit liquidity risk by investing primarily in
relatively short-term, high-quality securities.

PRINCIPAL INVESTMENT TECHNIQUES

MONEY MARKET OBLIGATIONS. These include:

- - U.S. Government securities with remaining maturities of 397 days or less,

- - Commercial paper rated in one of the two highest categories of any nationally
recognized statistical rating organization (rating agency),

- - Asset-backed commercial paper whose own ratings or the rating of any guarantor
is in one of the two highest categories of any rating agency,

- - Short-term bank obligations rated in one of the two highest categories by any
rating agency (with respect to obligations maturing in one year or less),

- - Repurchase agreements relating to debt obligations that the Fund could
purchase directly, and

- - Unrated debt obligations with remaining maturities of 397 days or less that
are determined by the Fund's investment adviser to be of comparable quality to
the securities described above.

Generally, money market obligations will not increase in value, but they are
high-quality investments that offer liquidity.

FLOATING AND VARIABLE RATE SECURITIES. Floating- and variable-rate securities
are securities that do not have fixed interest rates; the rates change
periodically. The interest rate on floating-rate securities varies with changes
in another index (such as the Treasury bill rate), while the interest rate on
variable-rate securities changes at preset times based upon an underlying index.
Some of the floating- or variable-rate securities will be callable by the
issuer, which means they can be paid off before their maturity date.

These securities are subject to credit and interest rate risk like other debt
securities. In addition, because they may be callable, these securities are also
subject to the risk that the Fund will be repaid prior to the stated maturity
and that the principal will be reinvested in a lower interest rate market that
reduces the Fund's income. The Fund will only purchase floating- and
variable-rate securities of the same quality as the debt securities it would
otherwise purchase.

REPURCHASE AGREEMENTS. When entering into repurchase agreements, the Fund
essentially makes a short-term loan to a qualified bank or broker-dealer. The
Fund buys securities that the seller has agreed to buy back at a specific time
and at a set price that includes interest. There is a risk that the seller will
be unable to buy back the securities at the time required and the Fund could
experience delays in recovering the amounts owed to it.

ASSET-BACKED COMMERCIAL PAPER. The Fund may invest in asset-backed commercial
paper that is secured by and paid from a pool of assets such as installment loan
contracts, leases of various types of property and receivables from credit
cards. Asset-backed commercial paper is issued and supported by private issuers.
This type of commercial paper is also subject to interest rate risk and credit
risk.

OTHER INVESTMENT TECHNIQUES

The Statement of Additional Information (SAI) contains additional information
about the Fund's other investments and investment techniques. To obtain a copy
of the SAI, see the back cover.

5
<PAGE> 25

MANAGEMENT

INVESTMENT ADVISER

Villanova Mutual Fund Capital Trust (VMF), Three Nationwide Plaza, Columbus,
Ohio 43215, manages the investment of the assets and supervises the daily
business affairs of the Fund. VMF was organized in 1999, and advises mutual
funds. As of December 31, 1999, VMF and its affiliates had approximately $22.5
billion in assets under management.

The Fund pays VMF a management fee, which, is based on the Fund's average daily
net assets. The total management fee paid by the Fund for the fiscal year ended
October 31, 1999, expressed as a percentage of the Fund's average daily net
assets was 0.40%.

PORTFOLIO MANAGER

Patricia Mynster, Director of Securities Investments, is the portfolio manager
of the Money Market Fund. She has managed the Fund and its predecessor since
1997 and has managed short-term investments for Nationwide Insurance and its
affiliates since 1991.

6
<PAGE> 26

BUYING, SELLING AND EXCHANGING FUND SHARES

BUYING SHARES

The Fund offers two share classes, one of which is described in this prospectus.
Currently, insurance company accounts may purchase Service Class shares using
purchase payments received on variable insurance contracts issued to qualified
plans. Programs offered to qualified plans through broker-dealers or the
Nationwide Trust Company may also purchase Service Class shares of the Fund.
Qualified plan -- or variable insurance contract-directed -- purchases,
exchanges and redemptions are handled in accordance with terms of the qualified
plans or variable insurance contracts, subject to Fund restrictions contained
herein. Since the qualified plans or variable insurance contracts may have
different provisions with respect to the timing and method of purchases,
exchanges and redemptions, beneficial owners of the Service Class shares should
contract their designated financial intermediary directly for details concerning
transactions.

Service Class shares are currently sold only to separate accounts of Nationwide
Life Insurance Company and an omnibus account held by Nationwide Trust Company.
The address for these entities is One Nationwide Plaza, Columbus, Ohio 43215.

Service Class shares pay distribution and/or service fees under a Distribution
Plan. These fees are either retained by Nationwide Advisory Services, Inc. (NAS)
or are paid by NAS to brokers for distribution and shareholder services. Service
Class shares also pay administrative service fees. These fees are paid to
brokers and other entities that provide administrative support services to the
beneficial owners of such shares.

PURCHASE PRICE The purchase price of each share of the Fund is its "net asset
value" (NAV) next determined after the order is received. No sales charge is
imposed on the purchase of the Fund's Service Class shares. A separate NAV is
calculated for each class of the Fund. Generally, the NAV is based on the value
of the securities owned by the Fund less its liabilities. The NAV for a class is
determined by dividing the total market value of the securities owned by the
Fund allocable to such class, less its liabilities allocable to that class, by
the total number of that class' outstanding shares. NAV is determined at the
earlier of the close of regular trading on the New York Stock Exchange (usually
4 p.m. Eastern Time) on each day the Exchange is open for trading.

We do not determine NAV on the following days:
- - Christmas Day
- - New Year's Day
- - Martin Luther King Jr. Day
- - Presidents' Day
- - Good Friday
- - Memorial Day
- - Independence Day
- - Labor Day
- - Thanksgiving Day
- - Other days when the New York Stock Exchange is not open.

The Fund reserves the right not to determine an NAV for the Fund when it has not
received any orders to purchase, sell, or exchange shares. In determining the
Fund's net asset value, portfolio securities are valued at amortized cost, which
approximates market value, in accordance with Rule 2a-7 of the Investment
Company Act of 1940. Expenses and fees are accrued daily.

HOW TO PLACE YOUR PURCHASE ORDER

Eligible entities wishing to purchase Service Class shares should contact NAS at
1-800-848-0920 for information regarding such purchases.

SELLING SHARES

Shares may be sold (redeemed) at any time, subject to certain restrictions
described below. The redemption price is the NAV next determined after the order
is received.

Eligible entities wishing to sell Service Class shares should contact NAS at
1-800-848-0920 for information regarding such sales.

RESTRICTIONS ON SALES

Shares of the Fund may not be redeemed or the Fund may delay paying the proceeds
from a redemption when the New York Stock Exchange is closed (other than
customary weekend and holiday closings) or if trading is restricted or an
emergency exists.

DISTRIBUTION PLAN

The Trust has adopted a Distribution Plan under Rule 12b-1 of the Investment
Company Act, which permits the Fund to compensate NAS -- as distributor -- for
expenses associated with distributing its shares and providing shareholder
services.

DISTRIBUTION AND SERVICE FEES

Under the Distribution Plan, the Service Class shares of the Fund pays NAS
compensation accrued daily and paid monthly. Service Class shares of the Fund
pay an amount not exceeding, on an annual basis, 0.15% of the Service Class
shares' average daily net assets. Because these fees are paid out of the Fund's
assets on an ongoing basis, over time these fees will increase the cost of your
investment and may cost you more than paying other types of sales charges.

7
<PAGE> 27

Buying, Selling and Exchanging Fund Shares

EXCHANGING SHARES

You can exchange the shares you own for shares of another fund within Nationwide
Mutual Funds (except the Morley Capital Accumulation Fund) as long as they are
the same class of shares, both accounts have the same owner, and your first
purchase in the new fund meets the fund's minimum investment requirement. You
can not, however, exchange Service Class shares for Class B shares. There is no
sales charge for exchanges of Service Class shares.

HOW TO PLACE YOUR EXCHANGE ORDER

Contact NAS to request an exchange. If your request is received after 4 p.m.
Eastern Time, it will be processed the next day. The Trust reserves the right to
amend or discontinue these exchange privileges upon 60 days' written notice to
shareholders.

8
<PAGE> 28

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS OF INCOME DIVIDENDS

Substantially all of the Fund's net investment income, if any, will be declared
daily and paid as a dividends monthly in the form of additional Service Class
shares of the Fund.

DISTRIBUTIONS OF CAPITAL GAINS

If the Fund has net capital gains at the end of the calendar year (meaning the
gains from sales of securities exceed any losses from sales), it will distribute
this capital gain to shareholders annually.

TAX STATUS

Please refer to the SAI for more information regarding the tax treatment of the
Fund.

9
<PAGE> 29

FINANCIAL HIGHLIGHTS

Financial Highlights are not available for the Service Class shares (formerly,
Class R shares) prior to January 4, 1999, since Service Class shares had not yet
commenced operations. Financial Highlights are also presented for historical
purposes for the five year period ended October 31, 1999 for the Fund's initial
share class, Prime Shares, which includes information for the Fund and its
predecessor. The Prime Shares and Service Class shares' have different expense
structures.

The Financial Highlights for the five year period ended October 31, 1999 have
been audited by KPMG LLP, whose report thereon, insofar as they relate to each
of the years in the five year period ended October 31, 1999, together with the
financial statements for the Fund for the year ended October 31, 1999, appearing
in the annual report, which is available upon request.

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31,
1999(a) -- SERVICE
------------------------
<S> <C>
NET ASSET VALUE -- BEGINNING OF
PERIOD $ 1.00
Net investment income 0.04
Dividends from net investment
income (loss) (0.04)
-------
NET ASSET VALUE -- END OF PERIOD $ 1.00
=======
Total Return 3.69%
Ratios and supplemental data:
Expenses to average net assets 0.64%(b)
Net investment income to average
net assets 4.74%(b)
Expenses to average net assets* 0.79%(b)
Net investment income to average
net assets* 4.59%(b)
Net Assets, end of period (000) $22,295
</TABLE>

<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31,
-----------------------------------------------------------------------------------
1999(c) -- PRIME 1998(d) -- PRIME 1997 -- PRIME 1996 -- PRIME 1995 -- PRIME
---------------- ---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF
PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Net investment income 0.05 0.05 0.05 0.05 0.05
Dividends from net investment
income (loss) (0.05) (0.05) (0.05) (0.05) (0.05)
---------- ---------- -------- -------- --------
NET ASSET VALUE -- END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ======== ======== ========
Total Return 4.61% 5.15% 5.07% 5.05% 5.46%
Ratios and supplemental data:
Expenses to average net assets 0.61% 0.59% 0.59% 0.60% 0.62%
Net investment income to average
net assets 4.52% 4.96% 4.96% 4.93% 5.34%
Expenses to average net assets* N/A 0.64% 0.64% 0.65% 0.67%
Net investment income to average
net assets* N/A 4.91% 4.91% 4.88% 5.29%
Net Assets, end of period (000) $1,345,342 $1,048,689 $820,657 $729,500 $604,711
</TABLE>

- ---------------

* Ratios calculated as if no expenses were waived or reimbursed.

(a) The Nationwide Money Market Service Class shares were first offered to the
public on January 4, 1999.

(b) Annualized.

(d) Combined data for the Fund and its predecessor.

10
<PAGE> 30

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<PAGE> 31

(This Page Intentionally Left Blank)

<PAGE> 32

(This Page Intentionally Left Blank)

<PAGE> 33

INFORMATION FROM NATIONWIDE

Please read this Prospectus before investing. The following documents--which may
be obtained free of charge--contain additional information about the Fund. To
obtain a document free of charge, contact us at the address or number listed
below.

- - Statement of Additional Information (SAI) (incorporated by reference into this
Prospectus)

- - Annual Report (which contains a discussion of the market conditions and
investment strategies that significantly affect the Fund's performance)

- - Semi-Annual Report (as available)

FOR ADDITIONAL INFORMATION CONTACT:

Nationwide Advisory Services, Inc.
P.O. Box 1492
Columbus, OH 43216-1492
(614) 249-8705 (fax)

Nationwide Logo

FOR INFORMATION, ASSISTANCE AND WIRE ORDERS:

1-800-848-0920 (toll free, 8 a.m. - 5 p.m. Eastern Time

(Monday through Friday, except Thursday, in which case representatives are
available between 9:30 a.m. and 5 p.m. Eastern Time)).

FOR 24-HOUR ACCOUNT ACCESS:

1-800-637-0012 (toll free)
Also visit the Nationwide Family of Funds' website at www.nationwidefunds.com

INFORMATION FROM THE SECURITIES AND EXCHANGE COMMISSION

You can obtain copies of the Fund documents from the SEC as follows:

IN PERSON:

Public Reference Room in Washington, D.C. (For their hours of operation, call
1-202-942-8090.)

BY MAIL:

Securities and Exchange Commission
Public Reference Section

Washington, D.C. 20549-0102

(The SEC charges a fee to copy any documents.)

ON THE EDGAR DATABASE VIA THE INTERNET:

www.sec.gov.

BY ELECTRONIC REQUEST:

[email protected]

INVESTMENT COMPANY ACT FILE NO: 811-08495

THE NATIONWIDE FAMILY OF FUNDS
THREE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215-2228

HS-1232

<PAGE> 34

Nationwide S&P 500 Index Fund
(Service Class, Institutional Service Class and Local Fund Shares)

Prospectus
2000

March 1, 2000

[LOGO]

Nationwide(R)
Family of Funds

<PAGE> 35

TABLE OF CONTENTS

FUND SUMMARY.................................................................. 2
Objective and Principal
Strategies.................................................................... 3
Principal Risks... 3
Performance................................................................... 4
Fees and
Expenses...................................................................... 4

MORE ABOUT THE FUND........................................................... 5

Principal Risks and
Techniques.................................................................... 5

Non-Principal
Techniques.................................................................... 6

MANAGEMENT.................................................................... 7
Investment
Adviser....................................................................... 7
Multi-Manager
Structure..................................................................... 7
Subadviser.................................................................... 7

BUYING, SELLING AND EXCHANGING FUND SHARES.................................... 8
Choosing a Share
Class......................................................................... 8

Buying Shares................................................................. 8

Selling Shares................................................................ 9
Distribution
Plan.......................................................................... 9
Exchanging
Shares........................................................................ 9

DISTRIBUTIONS AND TAXES.......................................................10

Distributions of Income
Dividends.....................................................................10

Distributions of Capital
Gains.........................................................................10

Reinvesting
Distributions.................................................................10

State and Local
Taxes.........................................................................10

Selling Fund
Shares........................................................................10

Exchanging Fund
Shares........................................................................10

Tax Status....................................................................10

FINANCIAL HIGHLIGHTS..........................................................11

ADDITIONAL INFORMATION............................................... BACK COVER

1
<PAGE> 36

FUND SUMMARY
This Prospectus provides information about one of the Nationwide Mutual Funds:
Nationwide S&P 500 Index Fund (the Fund). "You" and "your" refer to potential
investors and current shareholders of the Fund.

A QUICK NOTE ABOUT SHARE CLASSES

The Fund has six different share classes, three of which are offered in this
Prospectus -- Service Class (formerly Class R shares), Institutional Service
Class (formerly Class Y shares) and Local Fund shares. The fees and expenses for
each share class are different, but each share class of the Fund represents an
investment in the same assets. Having different share classes simply lets you
choose the cost structure that is right for you.

The fees and expenses for the Fund are set forth below. For more information
about which share class offered by this Prospectus is right for you, see
"Buying, Selling and Exchanging Fund Shares -- Choosing a Share Class" beginning
on page eight.

2
<PAGE> 37

This section summarizes key information about the Fund. Use this summary to
compare the Fund with other mutual funds. More detailed information about the
risks and investment techniques of the Fund can be found in "More About the
Fund" beginning on page five.

OBJECTIVE AND PRINCIPAL STRATEGIES

The Fund seeks to provide investment results that correspond to the price and
yield performance of publicly traded common stocks, as represented by the
Standard & Poor's 500 Composite Stock Price Index (the S&P 500).(1) The S&P 500
is a market-weighted index composed of approximately 500 common stocks chosen by
Standard & Poor's based on a number of factors including industry group
representation, market value, economic sector and operating/ financial
condition. The investment objective of the Fund may not be changed without
shareholder approval.

A market-weighted index is an index in which the weighting of each security is
based on its market capitalization. In a market-weighted index, changes in the
price of a company with a large capitalization affect the level of the index
more than changes in the price of a company with a smaller market
capitalization.

The Fund employs a "passive" management approach, attempting to invest in a
portfolio of assets whose performance is expected to match approximately the
performance of the S&P 500. The Fund will be substantially invested in
securities in the S&P 500, and will invest at least 80% of its assets in
securities or other financial instruments in, or correlated with, the S&P 500.

The Fund invests in a statistically selected sample of stocks included in the
S&P 500 and in derivative instruments linked to the S&P 500. The Fund may not
invest in all of the common stocks in the S&P 500, or in the same weightings as
in the S&P 500. Because the Fund seeks to invest in assets whose performance
matches the performance of the S&P 500, it may concentrate more assets in fewer
companies and is considered a non-diversified fund. The Fund chooses investments
so that the market capitalizations, industry weightings and other fundamental
characteristics of the stocks and derivative instruments chosen are similar to
the S&P 500 as a whole. The Fund may also engage in securities lending.

Market capitalization is a common way to measure the size of a company based on
the price of its common stock; it is simply the number of outstanding shares of
the company multiplied by the current share price.

PRINCIPAL RISKS

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings, production
management and sales. Individual stocks may also be affected by the demand for a
particular type of stock, such as growth stocks or the stocks of companies with
a particular market capitalization. The stock market is affected by numerous
factors, including interest rates, the outlook for corporate profits, the health
of national and world economies, national and world social and political events,
and the fluctuations of other stock markets around the world. There is also the
risk that large capitalization companies could fall out of favor and investors
may look to other types of investments.

SELECTION RISK. The Fund is also subject to selection risk, which is the risk
that the Fund's investments, which may not fully replicate the S&P 500, may
perform differently from the securities in the S&P 500. The Fund will attempt to
be fully invested at all times and will not hold a significant portion of its
assets in cash. The Fund will generally not attempt to hedge against adverse
market movements. Therefore, the Fund might go down in value more than other
mutual funds in the event of a general market decline. In addition, an index

fund has operating and other expenses while an index does

- ---------------

(1) "Standard & Poor's", "S&P", "S&P 500", "Standard & Poor's 500", and "500"
are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use
by the Fund. The Fund is not sponsored, endorsed, sold or promoted by Standard &
Poor's and Standard & Poor's makes no representation regarding the advisability
of investing in the Fund. For further information regarding the trademark
licenses, see the Statement of Additional Information (SAI).

3
<PAGE> 38

FUND SUMMARY

not. As a result, while the Fund will attempt to track the S&P 500 as closely as
possible, it will tend to underperform the index to some degree over time.

NON-DIVERSIFIED FUND RISK. The Fund is a non-diversified fund, which means that
it may invest more of its assets in fewer companies than if it were a
diversified fund. By concentrating more assets in a smaller number of
investments, the Fund's risk is increased because some investments have a
greater effect on the Fund's performance. This helps the Fund's performance when
its investments are successful, but also hurts the Fund's performance when its
investments are unsuccessful.

PERFORMANCE

The following bar chart and table present the performance of the Fund. The bar
chart shows the Fund's annual total return. The table shows the Fund's average
annual total return for certain time periods compared to the returns of a broad-
based securities index. The bar chart and table provide some indication of the
risks of investing in the Fund.

Remember, however, that past performance does not guarantee similar results in
the future.

ANNUAL RETURNS -- LOCAL FUND SHARES

<TABLE>
<CAPTION>
1/1/99-
12/31/99
- ----------------------------------------------------------
<S> <C>
Local Fund Shares 20.08%
</TABLE>

Best Quarter - Local Fund Shares: 14.59% 4th qtr of 1999

Worst Quarter - Local Fund Shares: -6.27% 3rd qtr of 1999

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999 Year Inception(1)
- ---------------------------------------------------------------------------
<S> <C> <C>
Local Fund Shares 20.08% 20.29%
...........................................................................
Service Class Shares 19.54% 19.92%
...........................................................................
Institutional Service Class Shares 19.79% 20.18%
...........................................................................
S&P 500(2) 21.04% 20.86%
</TABLE>

- ---------------

(1) The Fund's Local Fund Shares Class began operations July 24, 1998; each of
the Institutional Service Class and Service Class shares (formerly the Class
Y and R shares, respectively) began operations on November 2, 1998.

(2) The S&P 500 is an unmanaged index of 500 widely held stocks of large U.S.
companies, as described on page three. The since inception return for the
Index is from inception of the Local Fund shares. These returns do not
include the effect of any expenses. If expenses were deducted, the actual
return of this Index would be lower.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the Fund.

<TABLE>
<CAPTION>
Institutional
Service Service
Class Class Local Fund
Shares Shares Shares
- ------------------------------------------------------------------
<S> <C> <C> <C>
Shareholder Fees(1) None None None
(paid directly from your
investment)
..................................................................
</TABLE>

<TABLE>
<CAPTION>
Institutional
Service Service
Annual Fund Operating Expenses Class Class Local Fund
(deducted from Fund assets) Shares Shares Shares
- --------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.13% 0.13% 0.13%
....................................................................
Distribution and/or Service 0.15% None 0.07%
(12b-1) Fees
....................................................................
Other Expenses 0.55% 0.54% 0.32%
- --------------------------------------------------------------------
TOTAL ANNUAL FUND 0.83% 0.67% 0.52%
OPERATING EXPENSES(2)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(2) At least through October 31, 2000, Villanova Mutual Fund Capital Trust (VMF)
has agreed to waive fees or otherwise reimburse expenses for the Fund so
that the Total Annual Operating Expenses will not exceed 0.63% for Service
Class shares, 0.48% for Institutional Service Class shares and 0.35% for
Local Fund Shares.

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this Fund with other mutual funds.

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- -----------------------------------------------------------------
<S> <C> <C> <C> <C>
Service Class Shares $85 $265 $460 $1,025
.................................................................
Institutional Service
Class Shares $68 $214 $373 $ 835
.................................................................
Local Fund Shares $53 $167 $291 $ 653
</TABLE>

4
<PAGE> 39

MORE ABOUT THE FUND
This section contains a summary discussion of the general risks of investing in
the Fund. As with any mutual fund, there can be no guarantee that the Fund will
meet its goals or that the Fund's performance will be positive for any period of
time.

PRINCIPAL RISKS AND TECHNIQUES

The Fund may use the principal investment techniques to increase returns,
protect assets or diversify investments. These techniques are subject to certain
risks. For additional information about the Fund's investment strategies and
techniques, see the SAI.

The Fund will not attempt to buy or sell securities based on Fund management's
economic, financial or market analysis, but will instead employ a "passive"
investment approach. This means that the Fund's subadviser will attempt to
invest in a portfolio of assets whose performance is expected to match
approximately the performance of the S&P 500 before deduction of Fund expenses.
The Fund will only buy or sell securities when Fund management believes it is
necessary to do so in order to match the performance of the S&P 500.
Accordingly, it is anticipated that the Fund's portfolio turnover and trading
costs will be lower than "actively" managed funds. However, the Fund has costs
operating and other expenses, while the S&P 500 does not. Therefore, the Fund
will tend to underperform the S&P 500 to some degree over time.

Under normal circumstances, it is anticipated that the Fund's total return over
periods of one year and longer will, after taking into account estimated
expenses incurred by the Fund (as restated for the expenses of the Service Class
shares) be within 93 basis points (a basis point is one one-hundredth of one
percent (0.01%)) of the total return of the S&P 500. There can be no assurance,
however, that this level of correlation will be achieved. In the event that this
correlation is not achieved over time, the Trustees will consider alternative
strategies for the Fund. Information regarding correlation of the Fund's
performance to that of the S&P 500 will be reported in the Fund's annual report.

The S&P 500 is composed of 500 selected common stocks as determined by Standard
& Poor's, most of which are listed on the New York Stock Exchange. The S&P 500
is generally considered broadly representative of the performance of publicly
traded U.S. larger-capitalization stocks. Although a small part of the S&P 500
is made up of foreign companies which have a large presence in the U.S. Standard
& Poor's selects a stock for the S&P 500 based on the index's criteria; it does
not evaluate whether any particular stock is an attractive investment. Standard
& Poor's updates the S&P 500 periodically, at which time there may be
substantial changes in the composition of the index (and consequently,
significant turnover in the Fund).

SHORT-TERM INVESTMENTS. The Fund will also invest in short-term money market
instruments as cash reserves to maintain liquidity. These instruments may
include obligations of the U.S. Government, its agencies or instrumentalities,
highly rated bonds or comparable unrated bonds, commercial paper, bank
obligations and repurchase agreements. To the extent the Fund invests in short
term money market instruments, it will generally also invest in options, futures
or other derivatives in order to maintain full exposure to the S&P 500. The Fund
will not invest in options, futures, other derivative instruments or short term
money market instruments in order to lessen the Fund's exposure to common stocks
as a defensive strategy, but will instead attempt to remain fully invested at
all times.

DERIVATIVES RISK. The Fund may invest in derivative instruments, and will
normally invest a substantial portion of its assets in options and futures
contracts linked to the performance of the S&P 500. Derivatives allow the Fund
to increase or decrease its exposure to the S&P 500 quickly and at less cost
than buying or selling stocks. The Fund will invest in options and futures and
other derivative instruments in order to gain market exposure quickly in the
event of subscriptions to purchase shares of the Fund, to maintain liquidity in
the event of redemptions and to keep trading costs low.

The Fund may use the following types of derivative instruments: futures,
forwards and options, options on futures, swaps and indexed securities. Futures
are exchange-traded contracts involving the obligation of the seller to deliver,
and the buyer to receive, certain assets (or a money payment based on the change
in value of certain assets or an index) at a specified time. Forwards are
private contracts involving the obligation of the seller to deliver, and the
buyer to receive, certain assets (or a money payment based on the change in
value of certain assets or an index) at a specified time.

Options are exchange-traded or private contracts involving the right of a holder
to deliver (a put) or receive (a call) certain assets (or a money payment based
on the change in value of certain assets or an index) from another party at a
specified price with a specified time period.

Swaps are private contracts involving the obligation of each party to exchange
specified payments, which may be based on the value of an index or asset, with
the other party at specified times.

5
<PAGE> 40

More About the Fund

Indexed securities are debt obligations that return a variable amount of
principal or interest based on the value of an index at a specified time.

Derivatives are volatile and involve significant risks, which may include:

- -LEVERAGE RISK. Leverage risk is the risk associated with certain types of
investments or trading strategies (such as borrowing money to increase the
amount of investments) that relatively small market movements may result in
large changes in the value of an investment. Certain investments or trading
strategies that involve leverage can result in losses that greatly exceed the
amount originally invested.

- -CREDIT RISK. Credit risk is the risk that the counterparty (the party on the
other side of the transaction) on a derivative transaction will be unable to
honor its financial obligation to the Fund.

- -LIQUIDITY RISK. Liquidity risk is the risk that certain securities may be
difficult or impossible to sell at the time that the seller would like or at
the price that the seller believes the security is currently worth.

The Fund may use derivatives for anticipatory hedging. Anticipatory hedging is a
strategy in which the Fund uses a derivative to offset the risk that securities
in which the Fund intends to invest will increase in value before the Fund has
an opportunity to purchase the securities. The Fund will use derivatives for
anticipatory hedging in order to gain exposure efficiently to the S&P 500 in the
event the Fund receives cash inflows.

SECURITIES LENDING. The Fund may lend securities to financial institutions that
provide cash or government securities as collateral. Securities lending involves
the risk that the borrower may fail to return the securities in a timely manner
or at all. As a result, the Fund may lose money and there may be a delay in
recovering the loaned securities. The Fund could also lose money if it does not
recover the securities and the value of the collateral falls. These events could
trigger adverse tax consequences to the Fund.

NON-PRINCIPAL TECHNIQUES

BORROWING AND LEVERAGE -- The Fund may borrow for temporary emergency purposes
including to meet redemptions. Borrowing may exaggerate changes in the net asset
value of Fund shares and in the yield on the Fund's portfolio. Borrowing will
cost the Fund interest expense and other fees. The cost of borrowing may reduce
the Fund's return.

Certain securities that the Fund buys may create leverage, including, for
example, options.

SHORT SALES -- In connection with the use of derivative instruments, the Fund
may enter into short sales in order to adjust the weightings of particular
securities represented in a derivative to more accurately reflect the
securities' weightings in the S&P 500. In selling a security the Fund does not
own (a short sale), the Fund may borrow the security sold short to make delivery
to the buyer. The Fund must then replace the security it has borrowed. If the
price of a security sold short goes up between the time of the short sale and
the time the Fund must deliver the security to the lender, the Fund will incur a
loss. The Fund must also pay the lender any interest accrued during the period
of the loan.

OTHER INVESTMENTS AND INVESTMENT TECHNIQUES

The SAI contains additional information about the Fund, including the Fund's
other investments and investment techniques. To obtain a copy of the SAI, see
the back cover.

6
<PAGE> 41

MANAGEMENT

INVESTMENT ADVISER

Villanova Mutual Fund Capital Trust (VMF), Three Nationwide Plaza, Columbus,
Ohio 43215, manages the investment of the assets and supervises the daily
business affairs of the Fund. Subject to the supervision and direction of the
Trustees, VMF allocates Fund assets among subadvisers and evaluates and monitors
the performance of subadvisers. VMF is authorized to select and place portfolio
investments on behalf of the Fund; however, VMF does not intend to do so at this
time.

VMF was organized in 1999, and advises mutual funds. As of December 31, 1999,
VMF and its affiliates had approximately $22.5 billion in assets under
management.

The Fund pays VMF a management fee, which is based on the Fund's average daily
net assets. The total fee paid by the Fund for the fiscal year ended October 31,
1999, expressed as a percentage of the Fund's average daily net assets and not
taking into account any applicable waivers, was 0.13%.

MULTI-MANAGER STRUCTURE

VMF and Nationwide Mutual Funds (the Trust) have received from the Securities
and Exchange Commission an exemptive order for a multi-manager structure that
allows VMF to hire, replace or terminate a subadviser without the approval of
shareholders. The order also allows VMF to revise a subadvisory agreement with
Trustee approval but without shareholder approval. If a new subadviser is hired,
shareholders will receive information about the new subadviser within 90 days of
the change. The order allows the Fund to operate more efficiently and with
greater flexibility.

VMF provides the following oversight and evaluation services to the Fund:

- performing initial due diligence on prospective subadvisers for the Fund
- monitoring the performance of the subadvisers through ongoing analysis, as
well as periodic consultations
- communicating performance expectations and evaluations to the subadvisers
- ultimately recommending to the Board of Trustees whether a subadviser's
contract should be renewed, modified or terminated.

VMF does not expect to recommend frequent changes of subadvisers. VMF will
periodically provide written reports to the Board of Trustees regarding the
results of its evaluation and monitoring functions. Although VMF will monitor
the performance of the subadvisers, there is no certainty that any subadviser or
the Fund will obtain favorable results at any given time.

SUBADVISER

Subject to the supervision of VMF and the Trustees, the subadviser manages the
Fund's assets in accordance with the Fund's investment objective and strategies.
The subadviser makes investment decisions for the Fund and, in connection with
such investment decisions, places purchase and sell orders for securities.

Since December 29, 1999, Fund Asset Management, L.P., P.O. Box 9011, Princeton,
New Jersey 08543-9011, has been managing the Fund's investments and has the
responsibility for making all investment decisions for the Fund.

Fund Asset Management is part of the Merrill Lynch Asset Management Group, which
had approximately $557 billion in investment company and other portfolio assets
under management as of December 31, 1999. This amount includes assets managed
for Merrill Lynch affiliates.

Prior to December 29, 1999, The Dreyfus Corporation, a wholly-owned, indirect
subsidiary of Mellon Bank Corporation, served as the Fund's subadviser.

7
<PAGE> 42

BUYING, SELLING AND EXCHANGING FUND SHARES

CHOOSING A SHARE CLASS

As noted in the Fund Summary, the Fund offers six different share classes, three
of which are described in the Prospectus, to give investors different price and
cost options.

WHO CAN BUY SERVICE CLASS SHARES

Currently, insurance company separate accounts may purchase Service Class shares
using purchase payments received on variable insurance contracts issued to
qualified plans. Programs offered to qualified plans through broker-dealers or
the Nationwide Trust Company may also purchase Service Class shares of the Fund.
Qualified plan -- or variable insurance contract-directed -- purchases,
exchanges and redemptions are handled in accordance with terms of the qualified
plans or variable insurance contracts, subject to Fund restrictions contained
herein. Since the qualified plans or variable insurance contracts may have
different provisions with respect to the timing and method of purchases,
exchanges and redemptions, beneficial owners of the Service Class shares should
contact their designated financial intermediary directly for details concerning
transactions.

WHO CAN BUY INSTITUTIONAL SERVICE CLASS SHARES

The Institutional Service Class shares are available for purchase by the
following:
- retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
rollover individual retirement accounts from such plans
- tax-exempt employee benefit plans for which third party administrators
provide recordkeeping services and are compensated by the Fund for such
services
- a bank, trust company or similar financial institution investing for its own
account or for the account of its trust customers for whom such financial
institution is exercising investment discretion in purchasing Institutional
Service Class shares, where the investment is part of a program that
collects an administrative service fee
- registered investment advisers investing on behalf of institutions and high
net-worth individuals where the adviser is compensated by the Fund for
services it provides
- life insurance separate accounts to fund the benefits of variable annuity
contract issued to governmental entities as an investment option under their
deferred compensation plans as defined under Section 457 of the Internal
Revenue Code (the Code) or qualified plan adopted, pursuant to Section
401(a) of the Code.

WHO CAN BUY LOCAL FUND CLASS SHARES

Local Fund shares are sold to the funds of funds (mutual funds investing
primarily in other mutual funds), which are series of Nationwide Asset
Allocation Trust.

Service Class and Local Fund shares pay distribution and/or service fees under a
Distribution Plan. These fees are either retained by Nationwide Advisory
Services, Inc. (NAS) or are paid by NAS to brokers for distribution and
shareholder services. Service Class and Institutional Service Class shares also
pay administrative service fees. These fees are paid to brokers and other
entities that provide administrative support services to the beneficial owners
of Service Class and Institutional Service Class shares.

BUYING SHARES

PURCHASE PRICE. The purchase or "offering" price of one share of the Fund is
its "net asset value" (NAV) next determined after the order is received. A
separate NAV is calculated for each class of the Fund. No sales charge is
imposed on the purchase of the Fund's Service Class, Institutional Service Class
or Local Fund shares. Generally, the NAV is based on the market value of the
securities owned by the Fund less its liabilities. The NAV for a class is
determined by dividing the total market value of the securities owned by the
Fund allocable to such class, less liabilities allocable to that class, by the
total number of that class' outstanding shares. NAV is determined at the earlier
of the close of regular trading on the New York Stock Exchange (usually 4 p.m.
Eastern Time) on each day the Exchange is open for trading.

The Fund does not calculate NAV on the following days:

8
<PAGE> 43

The Fund reserves the right not to determine an NAV when:

- It has not received any orders to purchase, sell or exchange shares
- Changes in the value of the Fund's portfolio do not affect the NAV.

If current prices are not available, or if Villanova SA Capital Trust (VSA), as
the Fund's administrator or its agent, determines a price does not represent
fair value, the Fund's investments may be valued at fair market value in
accordance with procedures adopted by the Board of Trustees of the Trust. To the
extent that the Fund's investments are traded in markets that are open when the
New York Stock Exchange is closed, the value of the Fund's investments may
change on days when shares cannot be purchased or redeemed.

HOW TO PLACE YOUR PURCHASE ORDER

Eligible entities wishing to purchase Fund shares should contact NAS at
1-800-848-0920 for information regarding such purchases.

SELLING SHARES

You can sell -- also known as redeeming -- your shares of the Fund at any time,
subject to certain restrictions described below. The price you will receive when
you sell your shares will be the NAV next determined after the order is
received. Of course, the value of the shares you sell may be worth more or less
than their original purchase price depending upon the market value of the
investments of the Fund at the time of the sale.

Eligible entities wishing to sell Service Class, Institutional Service Class or
Local Fund shares should contact NAS at 1-800-848-0920 for information regarding
such sales.

RESTRICTIONS ON SALES

DISTRIBUTION PLAN

DISTRIBUTION AND SERVICE FEES

Under the Distribution Plan, Service Class and Local Fund Class shares of the
Fund pay NAS compensation accrued daily and paid monthly. Service Class and
Local Fund shares of the Fund pay an amount not exceeding an annual amount of:

<TABLE>
<CAPTION>
CLASS AS A % OF DAILY NET ASSETS
- ---------------------------------------------------------
<S> <C>
Service Class Shares 0.15%
.........................................................
Local Fund Class Shares 0.07%
</TABLE>

EXCHANGING SHARES

You can exchange the shares you own for shares of another fund within Nationwide
Mutual Funds (except the Morley Capital Accumulation Fund) as long as they are
the same class of shares and both accounts have the same owner. For example, you
cannot exchange Institutional Service Class shares for Service Class shares.
Please note that currently, no other fund within Nationwide Mutual Funds offers
Local Fund Shares.

CAPITAL GAINS TAXES

Exchanging shares is considered a sale and purchase of shares for federal and
state income tax purposes. Therefore, if the shares you exchange are worth more
than you paid for them, you may have to pay federal and/or state income taxes.
For more information, see "Distributions and Taxes -- Exchanging Fund Shares" on
page 10.

There is no sales charge for exchanges of Service Class or Institutional Service
Class shares.

HOW TO PLACE YOUR EXCHANGE ORDER

9
<PAGE> 44

DISTRIBUTIONS AND TAXES
The following information is provided to help you understand the income and
capital gains you can earn from owning Fund shares, as well as the federal taxes
you may have to pay on this income. For tax advice about your personal tax
situation, please speak with your tax adviser.

DISTRIBUTIONS OF INCOME DIVIDENDS

Every quarter, the Fund distributes any available income dividends to
shareholders. Income dividends are taxable to you as ordinary income for federal
income tax purposes, unless you hold your shares in a qualified tax-deferred
plan or account, or are otherwise not subject to federal income tax. The amount
of income dividends distributed to you will be reported in a Form 1099, which we
will send to you during the tax season each year (unless you hold your shares in
a qualified tax-deferred plan or account or are otherwise not subject to federal
income tax). For corporate shareholders, a portion of each year's distributions
may be eligible for the corporate dividend-received deduction.

DISTRIBUTIONS OF CAPITAL GAINS

If the Fund has net realized capital gains at the end of the calendar year
(meaning the gains from sales of securities exceed any losses from sales), it
will distribute this capital gain to shareholders annually. You must pay federal
income taxes on any capital gains distributed to you, unless you hold your
shares in a qualified tax-deferred plan or account or are otherwise not subject
to federal income tax. On Form 1099, we will report the amount of net short-term
capital gains and net long-term capital gains distributed to you during the
year. Currently, for individuals, long-term capital gains are taxed at a maximum
rate of 20%; short-term capital gains are taxed as ordinary income, such as
interest or dividends. For more information regarding capital gains tax rates,
speak with your tax adviser.

REINVESTING DISTRIBUTIONS

All income and capital gains distributions will be reinvested in shares of the
Fund. You may request a payment in cash in writing if distributions are in
excess of $5. You may be subject to tax on reinvested distributions. If
distribution checks (1) are returned and marked as "undeliverable" or (2) remain
uncashed for six months, your account will be changed automatically so that all
future distributions are reinvested in your account. Checks that remain uncashed
for six months will be canceled and the money reinvested in the Fund as of the
cancellation date. No interest is paid during the time the check is outstanding.

CHANGING YOUR DISTRIBUTION OPTION
If you want to change your distribution option, you must notify us by the record
date for a dividend or distribution in order for it to be effective for that
dividend or distribution.

You may be subject to federal backup withholding at a rate of 31% of each
distribution unless you certify that the taxpayer identification number you gave
us is correct, and that you are not subject to withholding. (We will, however,
withhold taxes if the Internal Revenue Service notifies us that such
certificates are not accurate, or as may otherwise be required under the
Internal Revenue Code.)

STATE AND LOCAL TAXES

Distributions may be subject to state and local taxes, even if not subject to
federal income taxes. State and local tax laws vary; please consult your tax
adviser.

SELLING FUND SHARES

Selling Fund shares for more than you paid for them gives you a capital gain,
which is subject to federal income tax. The amount of tax depends on how long
you held your shares. For individuals, long-term capital gains are currently
taxed at a maximum rate of 20%; and short-term capital gains are taxed as
ordinary income, such as interest or dividends. Capital gains from your sale of
Fund shares is not reported on Form 1099; you or your tax adviser should keep
track of your purchases, sales, and any resulting gain or loss. If you do sell
Fund shares for a loss, you may be able to use this capital loss to offset any
capital gains you have.

EXCHANGING FUND SHARES

Exchanging your shares of the Fund is considered a sale for income tax purposes.
Therefore, if the shares you exchange are worth more than you paid for them, you
have capital gains, which are subject to the federal income taxes described
above. If you exchange Fund shares for a loss, you may be able to use this
capital loss to offset any capital gains you have.

TAX STATUS

If you use the Fund as an investment option under a qualified employee benefit
plan or retirement plan or through some other tax-deferred account, dividend and
capital gain distributions from the fund generally are not currently subject to
federal income taxes. In general, the entities eligible to purchase the Fund's
shares are governed by complex tax rules. You should ask your own tax adviser or
plan administrator about your own tax situation, including possible state and
local taxes.

Please refer to the SAI for more information regarding the tax treatment of the
Fund.

10
<PAGE> 45
FINANCIAL HIGHLIGHTS

The financial highlights table is intended to help you understand the Fund's
financial performance for the period of the Fund's operation. Certain
information reflects financial results for a single Fund share. The total
returns in the table represent the rate that an investor would have earned or
lost on an investment in the Fund (assuming reinvestment of all dividends and
distributions). This information has been audited by KPMG LLP, whose report,
along with the Fund's financial statements, are included in the annual report,
which is available upon request.

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31, 1999 PERIOD ENDED
------------------------------------------- OCTOBER 31, 1998(A)
INSTITUTIONAL -------------------
SERVICE CLASS SERVICE CLASS LOCAL LOCAL
SHARES(B) SHARES(B) FUND SHARES FUND SHARES
------------- ------------- ----------- -------------------
<S> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $ 9.66 $ 9.66 $ 9.66 $ 10.00
Net investment income 0.09 0.10 0.12 0.04
Net realized gain (loss) and unrealized
appreciation (depreciation) 2.25 2.27 2.27 (0.35)
Total from investment operations 2.34 2.37 2.39 (0.31)
Dividends from net investment income (0.09) (0.09) (0.10) (0.03)
Net increase (decrease) in net asset value 2.25 2.28 2.29 (0.34)
------- ------- ------- -------
NET ASSET VALUE -- END OF PERIOD $ 11.91 $ 11.94 $ 11.95 $ 9.66
======= ======= ======= =======
Total Return 24.27% 24.64% 24.85% (3.08)%(c)
Ratios and supplemental data:
Net Assets, end of period (000) $72,049 $17,389 $30,674 $22,325
Ratio of expenses to average net assets 0.63% 0.48% 0.35% 0.35%(d)
Ratio of expenses to average net assets(e) 0.83% 0.67% 0.52% 0.64%(d)
Ratio of net investment income to average net
assets 0.69% 0.87% 1.05% 1.55%(d)
Ratio of net investment income to average net
assets(e) 0.49% 0.67% 0.88% 1.26%(d)
Portfolio turnover(f) 55.07% 55.07% 55.07% 3.07%
</TABLE>

- ---------------

(a) For the period from July 24, 1998 (commencement of operations) through
October 31, 1998.

(b) Service Class and Institutional Service Class shares (formerly Class R and Y
shares, respectively) were first offered to the public on November 2, 1998.

(d) Annualized

(e) Ratios calculated as if no fees were waived or expenses reimbursed.

(f) Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing among the classes of shares.

11
<PAGE> 46

[THIS PAGE INTENTIONALLY LEFT BLANK]

<PAGE> 47

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 48

INFORMATION FROM NATIONWIDE

Please read this Prospectus before you invest, and keep it with your records.
The following document contains additional information about the Fund. To obtain
a document free of charge, contact us at the address or number listed below.

- - SAI (incorporated by reference into this Prospectus)

- - Annual Report (which contains a discussion of the market conditions and
investment strategies that significantly effect the Fund's performance)

- - Semi-Annual Report (as available)

FOR ADDITIONAL INFORMATION CONTACT:

Nationwide Advisory Services, Inc.

P.O. Box 1492

Columbus, OH 43216-1492

(614) 249-8705 (fax)

Nationwide Logo

FOR INFORMATION, ASSISTANCE AND WIRE ORDERS:

1-800-848-0920 (toll free, 8 a.m. - 5 p.m. Eastern Time (Monday through Friday,
except Thursday, in which case representatives are available between 9:30 a.m.
and 5 p.m. Eastern Time.)

FOR 24-HOUR ACCOUNT ACCESS:

1-800-637-0012 (toll free)
Also, visit the Nationwide Family of Funds' website at www.nationwidefunds.com.

INFORMATION FROM THE SECURITIES AND EXCHANGE COMMISSION

You can obtain copies of Fund documents from the SEC as follows:

IN PERSON:

Public Reference Room in Washington, D.C. (For their hours of operation, call
1-202-942-8090.)

BY MAIL:

Securities and Exchange Commission
Public Reference Section
Washington, D.C. 20549-6009
(The SEC charges a fee to copy any documents.)

ON THE EDGAR DATABASE VIA THE INTERNET:

www.sec.gov

BY ELECTRONIC REQUEST:

[email protected]

INVESTMENT COMPANY ACT FILE NO. 811-08495

NATIONWIDE FAMILY OF FUNDS
THREE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215-2220

APO-4212-A

<PAGE> 49
Prestige Advisor Series
(Class A, Class B and Institutional Service Class Shares)

PROSPECTUS

March 1, 2000

2000

As with all mutual funds,
the Securities and Exchange
Commission has not approved
or disapproved these funds'
shares as an investment or
determined whether this
prospectus is complete or
accurate. To state
otherwise is a crime.

[NATIONWIDE LOGO]
Family of Funds

<PAGE> 50

TABLE OF CONTENTS

FUND SUMMARIES................................................................ 2

Prestige Large Cap Value Fund................................................. 3

Prestige Large Cap Growth Fund................................................ 6

Prestige Balanced Fund........................................................10

Prestige Small Cap Fund.......................................................14

Prestige International Fund...................................................17

MORE ABOUT THE FUNDS..........................................................20

Principal Risks and Techniques................................................20

Principal Risks...............................................................20

Non-Principal Risks...........................................................21

Principal Investment Techniques...............................................22

MANAGEMENT....................................................................23

Investment Adviser............................................................23

Multi-Manager Structure.......................................................23

Subadvisers...................................................................23

Historical Performance of the Subadvisers.....................................25

BUYING, SELLING AND EXCHANGING FUND SHARES....................................28

Choosing a Share Class........................................................28

Buying Shares.................................................................29

Selling Shares................................................................31

Distribution Plan.............................................................33

Exchanging Shares.............................................................34

DISTRIBUTIONS AND TAXES.......................................................35

Distributions of Income Dividends.............................................35

Distributions of Capital Gains................................................35

Reinvesting Distributions.....................................................35

State and Local Taxes.........................................................35

Selling Fund Shares...........................................................35

Exchanging Fund Shares........................................................35

FINANCIAL HIGHLIGHTS..........................................................36

ADDITIONAL INFORMATION................................................BACK COVER

1
<PAGE> 51

FUND SUMMARIES

This prospectus provides information about the Prestige Advisor Series of:
Prestige Large Cap Value Fund, Prestige Large Cap Growth Fund, Prestige Balanced
Fund, Prestige Small Cap Fund and Prestige International Fund (together the
Funds). "You" and "your" refer to potential investors and current shareholders
of one or more of the Funds.

A QUICK NOTE ABOUT SHARE CLASSES

Each Fund has three different share classes -- Class A, Class B and
Institutional Service Class (formerly Class Y). The fees, sales charges and
expenses for each share class are different, but each share class of a
particular Fund represents an investment in the same assets of that Fund. Having
different share classes simply lets you choose the cost structure that's right
for you.

The fees and expenses for each Fund are set forth in the Fund Summaries. For
more information about which share class is right for you, see "Buying, Selling
and Exchanging Fund Shares -- Choosing a Share Class" beginning on page 28.

ABOUT EACH FUND GENERALLY

Each Fund employs a "multi-manager" structure, which means that Villanova Mutual
Fund Capital Trust (VMF), as the Funds' investment adviser, may hire, replace or
terminate one or more subadvisers for a Fund without shareholder approval. VMF
believes that this structure gives it increased flexibility to manage the Funds
in your best interests and to operate the Funds more efficiently.

2
<PAGE> 52

FUND SUMMARIES -- PRESTIGE LARGE CAP VALUE FUND

This section summarizes key information about the Funds. Use these summaries to
compare the Funds with each other as well as with other mutual funds. More
detailed information about the risks and investment techniques of each Fund can
be found in "More About the Funds" beginning on page 20.

The Fund seeks to maximize total return, consisting of both capital appreciation
and current income. VMF has selected Brinson Partners, Inc. as a subadviser to
manage the Fund's portfolio on a day-to-day basis. To achieve its objective, the
Fund, under normal circumstances, invests at least 65% of its total assets in
equity securities of U.S. large capitalization companies which are traded on
major stock exchanges and the over-the-counter markets. The Fund considers large
capitalization companies to be those with market capitalizations similar to the
companies in The Russell 1000(R) Value Index.(1) As of December 31, 1999, the
market capitalizations of companies in The Russell 1000(R) Value Index ranged
from $250 million to $278 billion. The market capitalization range for companies
in The Russell 1000(R) Value Index is updated annually. The Fund looks for value
oriented securities by focusing on investment fundamentals such as price-to-book
and price earnings ratios and dividend yields. The Fund will consider purchasing
a security when it believes that the market price for such security is below its
fundamental investment value.

- ---------------

(1) The Russell 1000(R) Value Index is a registered service mark of The Frank
Russell Company which does not sponsor and is in no way affiliated with the
Fund.

PRINCIPAL RISKS

Because the value of an investment will fluctuate, there is the risk that a
shareholder will lose money. A shareholder's investment will decline in value if
the value of the Fund's investments decreases. The value of shares will also be
impacted in part by the subadviser's ability to assess economic conditions and
investment opportunities.

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings,
production, management and sales. Individual stocks may also be affected by the
demand for a particular type of stock, such as growth stocks or the stocks of
companies with a particular market capitalization. The stock market is affected
by numerous factors, including interest rates, the outlook for corporate
profits, the health of the national and world economies, national and world
social and political events, and the fluctuations of other stock markets around
the world. As of the date of this prospectus, U.S. stock markets and certain
foreign stock markets were trading at or close to record high levels. There is
no guarantee that such levels will continue.

RISKS RELATED TO INVESTING FOR VALUE. Different types of stocks tend to shift
into and out of favor with stock market investors depending on market and
economic conditions. Because the Fund generally focuses on value-style stocks,
the Fund's performance may at times be better or worse than the performance of
stock funds that focus on other types of stocks, or that have a broader
investment style.

3
<PAGE> 53

Fund Summaries -- Prestige Large Cap Value Fund

PERFORMANCE

The following bar chart and table present the performance of the Fund. The bar
chart shows the Fund's annual total return. The table shows the Fund's average
annual total returns for certain time periods compared to the returns of a
broad-based securities index. The bar chart and table provide some indication of
the risks of investing in the Fund. Remember, however, that past performance
does not guarantee similar results in the future.

ANNUAL RETURNS -- CLASS A SHARES(1)

<TABLE>
<CAPTION>
1/1/99-12/31/99
- --------------------------------------------------------------
<S> <C> <C>
Class A Shares 10.17%
</TABLE>

Best Quarter: 10.62% 2nd qtr of 1999
Worst Quarter: -12.99% 3rd qtr of 1999

- ---------------

(1) These annual returns do not include sales charges. If the sales charges were
included, the annual returns would be lower than those shown.

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999( 1) Year Inception( 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
Class A shares -10.17% -4.29%
................................................................................
Class B shares -10.73% -4.01%
................................................................................
Institutional Service Class shares -4.64% 0.83%
................................................................................
Russell l000(R) Value Index(3) 7.35% 13.71%
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges, if any, and expenses
are deducted.

(2) The Fund began operations on November 2, 1998.

(3) The Russell 1000(R) Value Index is an unmanaged index of the value
securities of large U.S. companies included in the Russell 1000(R) Index.
These returns do not include the effect of any sales charges or expenses. If
sales charges and expenses were deducted, the actual return of this Index
would be lower.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the Large Cap Value Fund.

<TABLE>
<CAPTION>
Institutional
Service
Shareholder Fees(1) Class A Class B Class
(paid directly from your investment) shares shares shares
- -----------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge (Load) imposed 5.75%(2) None None
upon purchases (as a percentage of
offering price)
.......................................................................
Maximum Deferred Sales Charge (Load) None 5.00%(3) None
imposed on redemptions (as a
percentage of original purchase
price or sale proceeds, as
applicable)
</TABLE>

<TABLE>
<CAPTION>
Institutional
Service
Annual Fund Operating Expenses Class A Class B Class
(deducted from Fund assets) shares shares shares
- -----------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.75% 0.75% 0.75%
.................................................................
Distribution and/or Service 0.25% 1.00% None
(12b-1) Fees
.................................................................
Other Expenses 0.87% 3.59% 3.46%
- -----------------------------------------------------------------
TOTAL ANNUAL FUND 1.87% 5.34% 4.21%
OPERATING EXPENSES(4)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(2) As the amount of your investment increases, the sales charge imposed on the
purchase of Class A shares decreases. For more information, see "Buying,
Selling and Exchanging Fund Shares -- Buying Shares -- Class A sales
charges" on page 29.

(3) A contingent deferred sales charge (CDSC) ranging from 5% to 1% is charged
when you sell Class B shares within the first six years of purchase. Class B
shares are converted to Class A shares after you have held them for seven
years. See "Buying, Selling and Exchanging Fund Shares -- Selling
Shares -- Contingent deferred sales charge (CDSC) on Class A and Class B
shares" on page 32.

(4) At least through October 31, 2000, VMF has agreed to waive fees or otherwise
reimburse expenses for the Fund so that the Total Annual Operating Expenses
will not exceed 1.15% for Class A shares, 1.90% for Class B shares and 1.00%
for Institutional Service Class shares.

4
<PAGE> 54

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this Fund with other mutual funds.

The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Shares $ 754 $1,129 $1,528 $2,639
...............................................................
Class B Shares $1,033 $1,894 $2,847 $4,252
...............................................................
Institutional Service
Class Shares $ 423 $1,278 $2,147 $4,380
</TABLE>

You would pay the following expenses on the same investment if you did not sell
your shares:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Shares $ 533 $1,594 $2,647 $4,252
</TABLE>

5
<PAGE> 55

FUND SUMMARIES -- PRESTIGE LARGE CAP GROWTH FUND

OBJECTIVE AND PRINCIPAL STRATEGIES

The Fund seeks long-term capital appreciation. VMF has selected Goldman Sachs
Asset Management as a subadviser to manage the Fund's portfolio on a day-to-day
basis. To achieve its objective, the Fund invests primarily in equity securities
of U.S. large capitalization companies that are expected to have better
prospects for earnings growth than the growth rate of the general domestic
economy. Dividend income is a second consideration. The Fund considers large
capitalization companies to be those with market capitalizations similar to the
companies in the Russell 1000(R) Growth Index.(1) As of December 31, 1999, the
market capitalizations of companies in the Russell 1000(R) Growth Index ranged
from $220 million to $604 billion. The market capitalization range for companies
in the Russell 1000(R) Growth Index is updated annually.

The Fund emphasizes a company's growth prospects in analyzing equity securities
to be purchased by the Fund. The Fund's investments are selected using both a
variety of quantitative techniques and fundamental research in seeking to
maximize the Fund's expected return while maintaining risk, style and
capitalization characteristics similar to The Russell 1000(R) Growth Index. The
Fund seeks a portfolio comprised of companies with above average capitalizations
and earnings growth expectations and below average dividend yields.

There are two building blocks in the subadviser's active management of the Fund:

1. STOCK SELECTION

The Fund uses the subadviser's proprietary multifactor model, a rigorous
computerized rating system, to forecast the returns of securities in the Fund's
portfolio. This model incorporates common variables covering measures of:

- Value (price-to-book, price-to-earnings, cash flow to enterprise value)
- ---------------

(1) The Russell 1000(R) Growth Index is a registered service mark of The Frank
Russell Company which does not sponsor and is in no way affiliated with the
Fund.

- Momentum (earnings momentum, price momentum, sustainable growth)

- Risk (market risk, company-specific risk, earnings risk)

- Research (fundamental research ratings of the subadviser and other analysts)

Each of these factors is carefully evaluated in the multifactor model because
each has demonstrated a significant impact on the performance of the securities
and markets they are designed to forecast. In this process, the subadviser
manages risk by limiting deviations from the benchmark, running size and sector
neutral portfolios.

2. PORTFOLIO CONSTRUCTION

A proprietary computer optimizer calculates every security combination (at each
possible weighting) to construct the most efficient risk/return portfolio given
the Fund's benchmark.

PRINCIPAL RISKS

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings,
production, management and sales. Individual stocks may also be affected by the
demand for a particular type of stock, such as growth stocks or the stocks of
companies with a particular market capitalization. The stock market is affected
by numerous factors, including interest rates, the outlook for corporate
profits, the health of the national and world economies, national and world
social and political events, and the fluctuations of other stock markets around
the world. As of the date of this prospectus, U.S. stock markets and certain
foreign stock markets were trading at or close to record high levels. There is
no guarantee that such levels will continue.

6
<PAGE> 56

RISKS RELATED TO INVESTING FOR GROWTH. Different types of stocks tend to shift
into and out of favor with stock market investors depending on market and
economic conditions. Because the Fund focuses on growth-style stocks, the Fund's
performance may at times be better or worse than the performance of stock funds
that focus on other types of stocks, or that have a broader investment style.

7
<PAGE> 57

Fund Summaries -- Prestige Large Cap Growth Fund

PERFORMANCE

ANNUAL RETURNS -- CLASS A SHARES(1)

<TABLE>
<CAPTION>
1/1/99-12/31/99
- --------------------------------------------------------------
<S> <C> <C>
Class A Shares 26.81%
</TABLE>

Best quarter: 22.82% 4th qtr. of 1999
Worst quarter: -2.61% 3rd qtr. of 1999

- ---------------

(1) These annual returns do not include sales charges. If the sales charges were
included, the annual returns would be lower than those shown.

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999(1) year Inception(2)
- ------------------------------------------------------------------------------
<S> <C> <C>
Class A shares 26.81% 39.43%
..............................................................................
Class B shares 28.94% 42.67%
..............................................................................
Institutional Service Class shares 34.83% 46.97%
..............................................................................
Russell 1000(R) Growth Index(3) 33.16% 46.57%
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges, if any, and expenses
are deducted.

(2) The Fund began operations on November 2, 1998.

(3) The Russell 1000(R) Growth Index is an unmanaged index of growth securities
of large U.S. companies included in the Russell 1000(R) Index. These returns
do not include the effect of any sales charges or expenses. If sales charges
and expenses were deducted, the actual return of this Index would be lower.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the Large Cap Growth Fund.

<TABLE>
<CAPTION>
Institutional
Service
Annual Fund Operating Expenses Class A Class B Class
(deducted from Fund assets) shares shares shares
- -----------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.80% 0.80% 0.80%
.................................................................
Distribution and/or Service 0.25% 1.00% None
(12b-1) Fees
.................................................................
Other Expenses 0.64% 3.46% 2.66%
- -----------------------------------------------------------------
TOTAL ANNUAL FUND 1.69% 5.26% 3.46%
OPERATING EXPENSES(4)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(4) At least through October 31, 2000, VMF has agreed to waive fees or otherwise
reimburse expenses for the Fund so that the Total Annual Operating Expenses
will not exceed 1.20% for Class A shares, 1.95% for Class B shares and 1.05%
for Institutional Service Class shares.

8
<PAGE> 58

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this fund with other mutual funds.

The example assumes that you invest $10,000 in the fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Shares $ 737 $1,077 $1,440 $2,458
..................................................................
Class B Shares $1,025 $1,872 $2,813 $4,156
..................................................................
Institutional Service Class
Shares $ 349 $1,062 $1,798 $3,738
</TABLE>

You would pay the following expenses on the same investment if you did not sell
your shares:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Shares $ 525 $1,572 $2,613 $4,156
</TABLE>

9
<PAGE> 59

FUND SUMMARIES -- PRESTIGE BALANCED FUND

OBJECTIVE AND PRINCIPAL STRATEGIES

The Fund seeks a high total return from a diversified portfolio of equity and
fixed income securities. VMF has selected J.P. Morgan Investment Management,
Inc. as a subadviser to manage the Fund's portfolio on a day-to-day basis. To
achieve its objective, the Fund, under normal circumstances, invests
approximately 60% of its assets in equity securities and 40% of its assets in
fixed income securities (including U.S. Government, corporate, mortgage-backed
and asset-backed securities). The equity securities held by the Fund generally
are common stocks of large and medium sized companies included in the Standard &
Poor's 500 Index.(1)

Investment grade securities are taxable debt securities, including corporate
bonds and other debt instruments, that have been rated within the four highest
rating categories by a nationally recognized rating agency, such as Standard &
Poor's Rating Group or Moody's Investors Service, Inc. The rating agency
evaluates a debt security, measures the issuer's financial condition and
stability, and assigns a rating to the security. By measuring the issuer's
ability to pay back the debt, ratings help investors evaluate the safety of
their bond investments.

The fixed income securities held by the Fund will generally be investment grade
securities, or unrated securities of comparable quality, although a portion of
the Fund's fixed income securities will be invested in securities rated below
investment grade (commonly known as junk bonds). All ratings are determined at
the time of investment. Any subsequent rating downgrade of a debt obligation
will be monitored by Fund management to consider what action, if any, the Fund
should take consistent with its investment objective. There is no requirement
that any such securities must be sold if downgraded.

Medium-grade securities are obligations rated in the fourth highest rating
category by any rating agency. Medium-grade securities, although considered
investment grade, have speculative characteristics and may be subject to greater
fluctuations in value than higher-rated securities. In addition, the issuers of
medium-grade securities may be more vulnerable to adverse economic conditions or
changing circumstances than issuers of higher-rated securities.
- ---------------

(1) The Standard & Poor's 500 Index is a registered service mark of Standard &
Poor's which does not sponsor and is in no way affiliated with the Fund.

PRINCIPAL RISKS

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings,
production, management and sales. Individual stocks may also be affected by the
demand for a particular type of stock, such as growth stocks or the stocks of
companies with a particular market capitalization. The stock market is affected
by numerous factors, including interest rates, the outlook for corporate
profits, the health of the national and world economies, national and world
social and political events, and the fluctuations of other stock markets around
the world. As of the date of this prospectus, U.S. stock markets and certain
foreign stock markets were trading at or close to record high levels. There is
no guarantee that such levels will continue.

CREDIT RISK. Credit risk is the risk that the issuer of a debt security will be
unable to make the required payments of interest and/or repay the principal when
due. In addition, there is a risk that the rating of a debt security may be
lowered if an issuer's financial condition changes, which may lead to a greater
price fluctuation in the Fund. This risk is particularly strong for junk bonds
and other lower-rated securities.

INTEREST RATE RISK. Interest rate risk is the risk that increases in market
interest rates may decrease the value of the debt securities held by the Fund.
In general, the prices of debt securities fall when interest rates increase and
rise when interest rates decrease. Typically, the longer the maturity of a debt
security, the more sensitive it is to price shifts as a result of interest rate
changes.

PREPAYMENT RISK AND EXTENSION RISK. The issuers of mortgage- and asset-backed
securities may be able to repay principal in advance, and are especially likely
to do so when interest rates fall. Changes in prepayment rates can make the
price and yield of mortgage- and asset-backed securities

10
<PAGE> 60

volatile. When mortgage- and asset-backed securities are prepaid, the Fund may
also fail to recover premiums paid for the securities, resulting in an
unexpected capital loss, and the Fund may have to reinvest the proceeds from the
repayments at lower rates. In addition, rising interest rates may cause
prepayments to occur at slower than expected rates thereby effectively
lengthening the maturity of the securities and making them more sensitive to
interest rate changes.

Extension risk is the risk that anticipated payments on principal may not occur,
typically because of a rise in interest rates, and the expected maturity of the
security will increase. During periods of rapidly rising interest rates, the
anticipated maturity of a security may be extended past what the portfolio
manager anticipated, affecting the maturity and volatility of the Fund.

11
<PAGE> 61

Fund Summaries -- Prestige Balanced Fund

PERFORMANCE

The following bar chart and table present the performance of the Fund. The bar
chart shows the Fund's annual total return. The table shows the Fund's average
annual total returns for certain time periods compared to the returns of two
broad-based securities indices. The bar chart and table provide some indication
of the risks of investing in the Fund. Remember, however, that past performance
does not guarantee similar results in the future.

ANNUAL RETURNS -- CLASS A SHARES(1)

<TABLE>
<CAPTION>
1/1/99-12/31/99
- --------------------------------------------------------------
<S> <C> <C>
Class A Shares 9.14%
</TABLE>

Best Quarter: 6.58% 4th qtr of 1999
Worst Quarter: -3.48% 3rd qtr of 1999

- ---------------

(1) These annual returns do not include sales charges. If the sales charges were
included, the annual returns would be lower than those shown.

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999(1) Year Inception(2)
- ------------------------------------------------------------------------------
<S> <C> <C>
Class A shares 2.89% 8.89%
..............................................................................
Class B shares 3.23% 10.27%
..............................................................................
Institutional Service Class shares 9.28% 14.75%
..............................................................................
S&P 500 Index(3) 21.04% 29.97%
..............................................................................
Lehman Brothers Aggregate Bond Index(4) -0.83% 0.03%
..............................................................................
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges, if any, and expenses
are deducted.

(2) The Fund began operations on November 2, 1998.

(3) The S&P 500 is a market weighted, unmanaged index of 500 stocks in a variety
of industry sectors designed to measure performance of the broad domestic
economy. These returns do not include the effect of any sales charges or
expenses. If sales charges and expenses were deducted, the actual return of
this Index would be lower.

(4) The Lehman Brothers Aggregate Bond Index is an unmanaged index comprised of
The Lehman Brothers Government/Corporate Bond Index and two Lehman Brothers
asset-backed securities indices. These returns do not include the effect of
any sales charges or expenses. If sales charges and expenses were deducted,
the actual return of this Index would be lower.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the Balanced Fund.

<TABLE>
<CAPTION>
Institutional
Service
Annual Fund Operating Expenses Class A Class B Class
(deducted from Fund assets) shares shares shares
- -----------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.75% 0.75% 0.75%
.................................................................
Distribution and/or Service 0.25% 1.00% None
(12b-1) Fees
.................................................................
Other Expenses 2.44% 2.50% 2.55%
- -----------------------------------------------------------------
TOTAL ANNUAL FUND 3.44% 4.25% 3.30%
OPERATING EXPENSES(4)
</TABLE>

- ---------------

(1 )If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(4) At least through October 31, 2000, VMF has agreed to waive fees or otherwise
reimburse expenses for the Fund so that the Total Annual Operating Expenses
will not exceed 1.10% for Class A shares, 1.85% for Class B shares and 0.95%
for Institutional Service Class shares.

12
<PAGE> 62

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this Fund with other mutual funds.

The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Shares $ 902 $1,571 $2,261 $4,082
...............................................................
Class B Shares $ 927 $1,589 $2,365 $4,160
...............................................................
Institutional Service
Class Shares $ 333 $1,015 $1,722 $3,595
</TABLE>

You would pay the following expenses on the same investment if you did not sell
your shares:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Shares $ 427 $1,289 $2,165 $4,160
</TABLE>

13
<PAGE> 63

FUND SUMMARIES -- PRESTIGE SMALL CAP FUND

OBJECTIVE AND PRINCIPAL STRATEGIES

The Fund seeks long-term capital appreciation. VMF has selected INVESCO, Inc. as
subadviser to manage the Fund's portfolio on a day-to-day basis. To achieve its
objective, the Fund, under normal circumstances, invests at least 65% of its
assets in equity securities of small capitalization companies. The Fund
considers small capitalization companies to be those with market capitalization
no greater than 110% of the largest company in the Russell 2000(R) Index(1). As
of December 31, 1999, the market capitalizations of companies in the Russell
2000(R) Index ranged from $100 million to $13 billion. The market capitalization
range for companies in the Russell 2000(R)Index is updated annually. The Fund
looks at many factors when considering which securities to purchase for the
Fund, including measures of value, momentum and quality, and other
non-quantitative information about the issuers.

The Fund may also invest in equity securities of U.S. companies with larger
market capitalizations and in foreign securities.
- ---------------

(1) The Russell 2000(R) Index is a registered service mark of The Frank Russell
Company which does not sponsor and is in no way affiliated with the Fund.

PRINCIPAL RISKS

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings,
production, management and sales. Individual stocks may also be affected by the
demand for a particular type of stock, such as growth stocks or the stocks of
companies with a particular market capitalization. The stock market is affected
by numerous factors, including interest rates, the outlook for corporate
profits, the health of the national and world economies, national and world
social and political events, and the fluctuations of other stock markets around
the world. As of the date of this prospectus, U.S. stock markets and certain
foreign stock markets were trading at or close to record high levels. There is
no guarantee that such levels will continue.

SMALL CAP RISK. The Fund focuses on a more narrow portion of the overall stock
market by investing primarily in companies with smaller market capitalizations.
These investments in smaller, often newer companies may be riskier than
investments in larger, more established companies. The stocks of small companies
are usually less stable in price and less liquid than stocks of larger.

FOREIGN RISK. To the extent the Fund invests in foreign securities, the Fund is
also subject to foreign investment risks, which are in addition to those of U.S.
investments. These risks include political and economic risks, currency
fluctuations, higher transaction costs and delayed settlement.

14
<PAGE> 64

PERFORMANCE

ANNUAL RETURNS -- CLASS A SHARES(1)

<TABLE>
<CAPTION>
1/1/99-12/31/99
- --------------------------------------------------------------
<S> <C> <C>
Class A Shares 11.83%
</TABLE>

Best Quarter: 17.32% 4th qtr of 1999
Worst Quarter: -7.61% 1st qtr of 1999

- ---------------

(1) These annual returns do not include sales charges. If the sales charges were
included, the annual returns would be lower than those shown.

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999(1) Year Inception(2)
- ------------------------------------------------------------------------------
<S> <C> <C>
Class A shares 11.83% 18.34%
..............................................................................
Class B shares 13.12% 20.67%
..............................................................................
Institutional Service Class shares 18.76% 24.70%
..............................................................................
Russell 2000(R) Index(3) 21.26% 29.75%
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges, if any, and expenses
are deducted.

(2) The Fund began operations on November 2, 1998.

(3) The Russell 2000(R) Index is an unmanaged index of approximately 2000
companies with small market capitalizations relative to the market
capitalizations of other U.S. companies. These returns do not include the
effect of any sales charges or expenses. If sales charges and expenses were
deducted, the actual return of this Index would be lower.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the Small Cap Fund.

<TABLE>
<CAPTION>
Institutional
Service
Annual Fund Operating Expenses Class A Class B Class
(deducted from Fund assets) shares shares shares
- -----------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.95% 0.95% 0.95%
.................................................................
Distribution and/or Service 0.25% 1.00% None
(12b-1) Fees
.................................................................
Other Expenses 1.04% 4.62% 3.92%
- -----------------------------------------------------------------
TOTAL ANNUAL FUND 2.24% 6.57% 4.87%
OPERATING EXPENSES(4)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(4) At least through October 31, 2000, VMF has agreed to waive fees or otherwise
reimburse expenses for the Fund so that the Total Annual Operating Expenses
will not exceed 1.35% for Class A shares, 2.10% for Class B shares and 1.20%
for Institutional Service Class shares.

15
<PAGE> 65

Fund Summaries -- Prestige Small Cap Fund

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this Fund with other mutual funds.

The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Shares $ 789 $1,235 $1,706 $3,002
...............................................................
Class B Shares $1,152 $2,225 $3,358 $4,958
...............................................................
Institutional Service
Class Shares $ 487 $1,464 $2,443 $4,902
</TABLE>

You would pay the following expenses on the same investment if you did not sell
your shares:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Shares $ 652 $1,925 $3,158 $4,958
</TABLE>

16
<PAGE> 66

FUND SUMMARIES -- PRESTIGE INTERNATIONAL FUND

OBJECTIVE AND PRINCIPAL STRATEGIES

The Fund seeks long-term capital appreciation. VMF has selected Lazard Asset
Management as subadviser to manage the Fund's portfolio on a day-to-day basis.
To achieve its objective, the Fund invests primarily in equity securities,
principally common stocks, of relatively large non-U.S. companies. These
companies will have market capitalizations in the range of the Morgan Stanley
Capital International Europe, Australia and Far East Index (MSCI EAFE Index). A
stock is issued by a non-U.S. company if the company is organized outside U.S.,
the principal market for the stock is outside the U.S. or the company derives at
least 50% of its revenues from business outside the U.S. The Fund invests in
such non-U.S. companies either directly or through Depositary Receipts,
including American Depositary Receipts and Global Depositary Receipts.

Depositary Receipts are securities representing foreign securities that are
deposited with foreign custodians, U.S. commercial banks or foreign branches of
U.S. commercial banks. American Depositary Receipts or "ADRs" are U.S. dollar-
denominated and traded on U.S. exchanges. Global Depositary Receipts or "GDRs"
are foreign currency denominated and trade on foreign exchanges.

Under normal conditions, the Fund invests at least 80% of its total assets in
securities of companies within not less than three foreign countries. The Fund
focuses on securities that are believed to be inexpensively priced in comparison
to the return on total capital or equity.

The Fund may also engage in foreign currency transactions.

The Fund seeks to match the performance of the MSCI EAFE Index as closely as
possible before the deduction of Fund expenses. The MSCI EAFE Index is composed
of equity securities of companies from various industrial sectors whose primary
trading markets are located outside the United States. Companies included in the
MSCI EAFE Index are selected from among the larger capitalization companies in
these markets. The weighting of the MSCI EAFE index is based on the market
capitalization of each of the countries in the Index.

The Fund invests in a statistically selected sample of equity securities
included in the MSCI EAFE Index and in derivative instruments linked to the MSCI
EAFE Index. The Fund may not invest in all of the countries, or all of the
companies within a country, represented in the MSCI EAFE Index, or in the same
weightings as in the MSCI EAFE Index. The Fund will choose investments so that
the market capitalizations, industry weightings and other fundamental
characteristics of the stocks and derivative instruments chosen are similar to
the MSCI EAFE Index as a whole. Because the Fund seeks to invest in assets whose
performance matches the performance of the MSCI EAFE Index, it may concentrate
more assets in fewer companies and is considered a non-diversified fund. The
Fund may also engage in securities lending.

PRINCIPAL RISKS

STOCK MARKET RISK. Stock market risk is the risk that the Fund could lose value
if the individual stocks in which the Fund has invested or the overall stock
market goes down. Individual stocks and the overall stock market may experience
short-term volatility as well as extended periods of decline or little growth.
Individual stocks are affected by factors such as corporate earnings,
production, management and sales. Individual stocks may also be affected by the
demand for a particular type of stock, such as growth stocks or the stocks of
companies with a particular market capitalization. The stock market is affected
by numerous factors, including interest rates, the outlook for corporate
profits, the health of the national and world economies, national and world
social and political events, and the fluctuations of other stock markets around
the world. As of the date of this prospectus, U.S. stock markets and certain
foreign stock markets were trading at or close to record high levels. There is
no guarantee that such levels will continue.

17
<PAGE> 67

Fund Summaries -- Prestige International Fund

FOREIGN RISK. The Fund is also subject to foreign risks that are risks related
to owning securities of foreign companies. These risks include political and
economic risks, currency fluctuations, higher transaction costs and delayed
settlement.

PERFORMANCE

The following bar chart and table presents the performances of the Fund. The bar
chart shows the Fund's annual total return. The table shows the Fund's average
annual total returns for certain time periods compared to the returns of a
broad-based securities index. The bar chart and table provide some indication of
the risks of investing in the Fund. Remember, however, that past performance
does not guarantee similar results in the future.

ANNUAL RETURNS -- CLASS A SHARES(1)

<TABLE>
<CAPTION>
1/1/99-12/31/99
- --------------------------------------------------------------
<S> <C> <C>
Class A Shares 21.04
</TABLE>

Best Quarter: 11.74% 4th qtr of 1999
Worst Quarter: 0.18% 1st qtr of 1999

- ---------------

(1) These annual returns do not include sales charges. If the sales charges were
included, the annual returns would be lower than those shown.

<TABLE>
<CAPTION>
One Since
Average annual returns -- as of December 31, 1999( 1) Year Inception( 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
Class A shares 14.14% 17.49%
................................................................................
Class B shares 18.79% 22.62%
................................................................................
Institutional Service Class shares 21.37% 23.92%
................................................................................
MSCI EAFE Index(3) 27.30% 32.75%
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges, if any, and expenses
are deducted.

(2) The Fund began operations on November 2, 1998.

(3) The MSCI EAFE Index is an unmanaged index that is generally representative
of international stock markets. These returns do not include the effect of
any sales charges or expenses. If sales charges and expenses were deducted,
the actual return of this Fund would be lower.

18
<PAGE> 68

FEES AND EXPENSES

This table describes the fees and expenses that you may pay when buying and
holding shares of the International Fund.

<TABLE>
<CAPTION>
Institutional
Service
Annual Fund Operating Expenses Class A Class B Class
(deducted from Fund assets) shares shares shares
- -----------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.85% 0.85% 0.85%
.................................................................
Distribution and/or Service 0.25% 1.00% None
(12b-1) Fees
.................................................................
Other Expenses 1.77% 5.74% 5.45%
- -----------------------------------------------------------------
TOTAL ANNUAL FUND 2.87% 7.59% 6.30%
OPERATING EXPENSES(4)
</TABLE>

- ---------------

(1) If you buy and sell shares through a broker or other financial intermediary,
they may also charge you a transaction fee.

(4) At least through October 31, 2000, VMF has agreed to waive fees or otherwise
reimburse expenses for the Fund so that the Total Annual Operating Expenses
will not exceed 1.30% for Class A shares, 2.05 % for Class B shares and
1.25% for Institutional Service Class shares.

EXAMPLE

This example shows what you could pay in expenses over time. You can also use
this example to compare the costs of this Fund with other mutual funds.

The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then sell all of your shares at the end of those periods. It
assumes a 5% return each year and no changes in expenses and does not take into
account the fee waiver/expense reimbursement provisions currently in place for
the Fund. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Shares $ 848 $1,413 $2,001 $3,586
...............................................................
Class B Shares $1,249 $2,490 $3,757 $5,565
...............................................................
Institutional Service
Class Shares $ 626 $1,853 $3,049 $5,905
</TABLE>

You would pay the following expenses on the same investment if you did not sell
your shares:

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Shares $ 749 $2,190 $3,557 $5,565
</TABLE>

19
<PAGE> 69

MORE ABOUT THE FUNDS
This section contains a summary discussion of the general risks of investing in
a Fund. As with any mutual fund, there can be no guarantee that a Fund will meet
its goals or that a Fund's performance will be positive for any period of time.

PRINCIPAL RISKS AND TECHNIQUES

The Funds may use the following principal investment techniques to increase
returns, protect assets or diversify investments. These techniques involve
certain risks. For more information about the Funds' investment strategies and
techniques, please refer to the SAI.

PRINCIPAL RISKS

SMALL CAP RISK (SMALL CAP FUND) -- Historically, the securities of small cap
companies have been more volatile in price than larger company securities,
especially over the short term. Among the reasons for the greater price
volatility are the less certain growth prospects of small companies, the lower
degree of liquidity in the markets for such securities, the greater impact
caused by changes in investor perception of value, and the greater sensitivity
of small cap companies to changing economic conditions. In addition, small cap
companies may:

- lack depth of management

- lack a proven track record

- be unable to generate funds necessary for growth or development

- be developing or marketing new products or services for which markets are
not yet established and may never become established

- market products or services which may become quickly obsolete

Small cap companies in the technology and biotechnology industries may be
subject to abrupt or erratic price movements. Therefore, while small cap
companies may offer greater opportunities for capital growth than larger, more
established companies, they also involve greater risks and should be considered
speculative.

FOREIGN RISK (SMALL CAP FUND AND INTERNATIONAL FUND) -- Foreign security
investment involves special risks not present in U.S. investments that can
increase the chances that a Fund will lose money.

COUNTRY -- General securities market movements in any country in which a Fund
has investments, are likely to affect the value of a Fund's securities that
trade in the country. These movements will affect a Fund's share price and a
Fund's performance. The political, economic and social structures of some
countries in which a Fund invests may be less stable and more volatile than
those in the U.S. The risk of investing in these countries include the
possibility of the imposition of exchange controls, currency devaluation,
foreign ownership limitations, expropriation, restrictions on removal of
currency or other assets, nationalization of assets, punitive taxes and certain
custody and settlement risks.

FOREIGN MARKETS -- A Fund is subject to the risk that because there are
generally fewer investors in foreign markets and a smaller number of securities
traded each day, it may make it difficult for a Fund to buy and sell certain
securities. In addition, prices of foreign securities may go up and down more
than prices of securities traded in the U.S. Also, brokerage commissions and
other costs of buying and selling securities often are higher in foreign
countries than they are in the United States. This reduces the amount the Fund
can earn on its investments.

GOVERNMENTAL SUPERVISION AND REGULATION/ACCOUNTING STANDARDS -- Foreign
companies are not subject to the same disclosure, accounting, auditing and
financial reporting standards and practices as U.S. companies. A Fund may have
greater difficulty voting proxies, exercising shareholder rights, pursuing legal
remedies and obtaining judgments with respect to foreign investments in foreign
courts than with respect to U.S. companies in U.S. courts. Many foreign
governments supervise and regulate stock exchanges, brokers and the sale of
securities less than the U.S. does. Other countries may not have laws to protect
investors the way that the U.S. securities laws do. Accounting standards in
other countries are not necessarily the same as in the U.S. If the accounting
standards in another country do not require as much detail as U.S. accounting
standards, it may be harder for a Fund's portfolio manager to completely and
accurately determine a company's financial condition.

CURRENCY -- Some of a Fund's investments may be denominated in foreign
currencies. Changes in foreign currency exchange rates will affect the value of
what a Fund owns and a Fund's share price. Generally, when the U.S. dollar rises
in value against a foreign currency, an investment in that country loses value
because that currency is worth fewer U.S. dollars. Devaluation of currency by a
country's government or banking authority also has a significant impact on the
value of any securities denominated in that currency. In addition, if the
currency in which a Fund receives dividends, interest or other payments declines
in value against the U.S. dollar before such income is distributed as dividends
to

20
<PAGE> 70

shareholders or converted to U.S. dollars, the Fund may have to sell portfolio
securities to obtain sufficient cash to pay such dividends.

EUROPEAN ECONOMIC AND MONETARY UNION (EMU) -- A number of European countries
have entered into EMU in an effort to reduce trade barriers between themselves
and eliminate fluctuations in their currencies. EMU has established a single
European currency (the euro), which was introduced in January 1, 1999 and is
expected to replace the existing national currencies of all initial EMU
participants by July 1, 2002. Certain securities (beginning with government and
corporate bonds) were redenominated in the euro. These securities trade and make
dividend and other payments only in euros. Like other investment companies and
business organizations, including the companies in which the Funds invest, the
Funds could be adversely affected:

- If the transition to euro, or EMU as a whole, does not proceed as planned.

- If a participating country withdraws from EMU.

- If the computing, accounting and trading systems used by a Fund's service
providers, or by other entities with which the Fund or its service
providers do business, are not capable of recognizing the euro as a
distinct currency.

RISK ASSOCIATED WITH GROWTH AND VALUE STOCKS (LARGE CAP GROWTH FUND, LARGE CAP
VALUE FUND) -- Due to their relatively low valuations, value stocks are
typically less volatile than growth stocks. In comparison, a growth stock's
price may be more directly linked to market developments than a value stock's
price. However, value stocks tend to have higher dividend yields than growth
stocks. This means they depend less on price changes for returns. Accordingly,
they might not participate in upward market movements, but may be less adversely
affected in a down market compared to lower yielding stocks.

LOWER-RATED SECURITIES RISK (BALANCED FUND) -- Investment in junk bonds and
other lower-rated or high yield securities involves substantial risk of loss.
These securities are considered speculative with respect to the issuer's ability
to pay interest and principal when due and are susceptible to default or decline
in market value due to adverse economic and business developments. The market
values of high yield securities tend to be very volatile, and these securities
are less liquid than investment grade debt securities. For these reasons an
investment in the Fund is subject to the following specific risks to the extent
that it invests in such securities:

- Increased price sensitivity to changing interest rates and the adverse
economic and business developments

- Greater risk of loss due to default or declining credit quality

- Greater likelihood that adverse economic or company specific events will
make the issuer unable to make interest and/or principal payments when due

- Negative market sentiments toward high yield securities may depress their
price and liquidity. If this occurs, it may become difficult to price or
dispose of a particular security in the Fund.

NON-PRINCIPAL RISKS

INFLATION RISK (BALANCED FUND) -- Inflation risk affects the value of fixed-rate
investments such as bonds. If the Fund buys bonds when inflation and interest
rates are low, the value of these bonds could fall as inflation rises and
interest rates increase. This could happen as investors find the bonds with
lower interest rates less attractive than bonds that pay higher interest rates.

LIQUIDITY RISK (EACH FUND) -- The risk that a Fund will not be able to pay
redemption proceeds within the time period stated in this Prospectus because of
unusual market conditions, an unusually high volume of redemption requests, or
other reasons. Funds that invest in lower rated debt securities and small
capitalization stocks will be especially subject to the risk that during certain
periods the liquidity of particular issuers or industries, or all securities
within these investment categories, will shrink or disappear suddenly and
without warning as a result of adverse economic, market or political events, or
adverse investor perceptions whether or not accurate.

EVENT RISK (BALANCED FUND) -- Event risk is the risk that corporate issuers may
undergo restructurings, such as mergers, leveraged buyouts, takeovers, or
similar events, which may be financed by increased debt. As a result of the
added debt, the credit quality and market value of a company's bonds may decline
significantly.

21
<PAGE> 71

More About the Funds

PRINCIPAL INVESTMENT TECHNIQUES

U.S. GOVERNMENT SECURITIES (BALANCED FUND) -- These securities include Treasury
bills, notes, and bonds, securities issued or guaranteed by the U.S. Government
and securities issued by U.S. government agencies, including:

- The Federal Housing Administration, the Farmers Home Administration and the
Government National Mortgage Association ("GNMA"), including GNMA
pass-through certificates, which are backed by the full faith and credit of
the United States;

- The Federal Home Loan Banks;

- The Federal National Mortgage Association (FNMA);

- The Student Loan Marketing Association and Federal Home Loan Mortgage
Corporation (FHLMC); and

- The Federal Farm Credit Banks.

Although there is virtually no credit risk with these U.S. Government
securities, neither the U.S. Government nor its agencies guarantee the market
value of their securities. Interest rate changes, prepayment rates and other
factors may affect the value of these securities.

MORTGAGE-BACKED AND ASSET-BACKED SECURITIES (BALANCED FUND) -- U.S. Government
mortgage-backed securities are securities that are secured by and paid from a
pool of mortgage loans on real property and issued or guaranteed by the U.S.
Government or one of its agencies. Mortgage-backed securities may also be issued
by private issuers. Collateralized mortgage obligations (CMOs) are securities
that have mortgage loans or mortgage pass-through securities, such as GNMA, FNMA
or FHLMC certificates, as their collateral. CMOs can be issued by the U.S.
Government or its agencies or by private lenders.

Mortgage-backed securities are subject to interest rate risk and to credit risk
if they are issued by private issuers. CMOs and other mortgage-backed securities
are also subject to prepayment risk. With respect to prepayment risk, when
interest rates fall homeowners may refinance their loans and the mortgage-backed
security will be paid off sooner than the portfolio manager anticipated.
Reinvesting the returned principal in a lower interest rate market reduces the
Fund's income. Mortgage-backed securities are also subject to extension risk and
the possibility of losing principal as a result of prepayments.

OTHER INVESTMENT TECHNIQUES

The Funds may engage in hedging techniques such as the purchase and sale of
options and future contracts, as described in the SAI.

The SAI contains additional information about the Funds, including the Funds'
other investment techniques. To obtain a copy, see the back cover page.

TEMPORARY DEFENSIVE POSITIONS

In response to economic, political or unusual market conditions, each Fund may
invest up to 100% of its assets in cash or money market obligations. Should this
occur, a Fund may not meet its investment objectives and may miss potential
market upswings.

22
<PAGE> 72

MANAGEMENT

INVESTMENT ADVISER

Villanova Mutual Fund Capital Trust (VMF), Three Nationwide Plaza, Columbus,
Ohio 43215, manages the investment of the assets and supervises the daily
business affairs of each of the Funds. Subject to the supervision and direction
of the Trustees, VMF allocates Fund assets among subadvisers and evaluates and
monitors the performance of subadvisers. VMF is authorized to select and place
portfolio investments on behalf of a Fund; however, VMF does not intend to do so
at this time. VMF was organized in 1999, and advises mutual funds. As of
December 31, 1999, VMF and its affiliates had approximately $22.5 billion in
assets under management.

Each Fund pays VMF a management fee, which is based on the Funds' average daily
net assets. The total management fee paid by the Funds for the fiscal year ended
October 31, 1999 -- expressed as a percentage of a Fund's average daily net
assets -- was as follows:

<TABLE>
<CAPTION>
Fund Fee
- ----------------------------------------------------------------
<S> <C>
Large Cap Value Fund 0.75%
................................................................
Large Cap Growth Fund 0.80%
................................................................
Balanced Fund 0.75%
................................................................
Small Cap Fund 0.95%
................................................................
International Fund 0.85%
</TABLE>

MULTI-MANAGER STRUCTURE

VMF and the Trust have received from the Securities and Exchange Commission an
exemptive order for a multi-manager structure that allows VMF to hire, replace
or terminate a subadviser without the approval of shareholders. The order also
allows VMF to revise a subadvisory agreement with Trustee approval but without
shareholder approval. If a new subadviser is hired, shareholders will receive
information about the new subadviser within 90 days of the change. The order
allows the Funds to operate more efficiently and with greater flexibility.

VMF provides the following oversight and evaluation services to the Funds:

- performing initial due diligence on prospective subadvisers for a Fund;

- monitoring the performance of the subadvisers through ongoing analysis, as
well as periodic consultations;

- communicating performance expectations and evaluations to the subadvisers;
and

- ultimately recommending to the Board of Trustees whether a subadviser's
contract should be renewed, modified or terminated.

SUBADVISERS

Subject to the supervisions of VMF and the Trustees, a subadviser will manage a
Fund's assets in accordance with the Fund's investment objective and strategies.
With regard to the portion of a Fund's assets allocated to it, each subadviser
makes investment decisions for the Fund and, in connection with such investment
decisions, places purchase and sell orders for securities.

The following are the subadvisers for each Fund:

LARGE CAP VALUE FUND -- BRINSON PARTNERS, INC.

Brinson Partners, a Delaware corporation, serves as Subadviser to the Large Cap
Value Fund. Brinson Partners is registered with the Securities and Exchange
Commission as an investment adviser and, as of December 31, 1999, managed $79
billion, primarily for pension and profit sharing institutional accounts.
Brinson Partners was organized in 1989 when it acquired the institutional asset
management business of The First National Bank of Chicago and First Chicago
Investment Advisors, N.A. Brinson Partners and its predecessor entities have
managed domestic and international investment assets since 1974 and global
investment assets since 1982. Brinson Partners is an indirect wholly-owned
subsidiary of UBS AG, an internationally diversified financial organization
headquartered in Zurich, Switzerland, and is the headquarters of UBS Brinson, an
institutional asset management organization within UBS AG, UBS Brinson has
offices in Chicago, Basel, Bahrain, London, Frankfurt, Geneva, Melbourne, New
York, Paris, Rio de Janeiro, Singapore, Sydney, Tokyo and Zurich and manages
over $280 billion worldwide.

PORTFOLIO MANAGERS. Investment decisions for the Large Cap Value Fund are made
by an investment management team at

23
<PAGE> 73

Management

Brinson Partners. No individual member of the investment management team is
primarily responsible for making recommendations regarding portfolio purchases
and sales.

LARGE CAP GROWTH FUND -- GOLDMAN SACHS ASSET MANAGEMENT

Goldman Sachs Asset Management (GSAM), a division of the Investment Management
Division (IMD), which was established September 1, 1999 and is a separate
operating division of Goldman, Sachs & Co. ("Goldman Sachs"), serves as
Subadviser to the Large Cap Growth Fund. Goldman Sachs registered with the
Securities and Exchange Commission as an investment adviser in 1981. The Goldman
Sachs Group, LP., which controlled the Subadviser, merged into The Goldman Sachs
Group Inc. as a result of an initial public offering. As of December 31, 1999,
GSAM, along with other units of IMD have assets under management of $240.3
billion.

In performing its investment advisory services, GSAM, although responsible for
the management of the Fund, is able to draw upon the research and expertise of
its asset management affiliates for portfolio decisions and management with
respect to certain portfolio securities. In addition, GSAM will have access to
the research of Goldman Sachs, as well as certain proprietary technical models
developed by Goldman Sachs, and may apply quantitative and qualitative analysis
in determining the appropriate allocations among the categories of issuers and
types of securities.

PORTFOLIO MANAGERS. Robert C. Jones, Managing Director, Kent A. Clark, Managing
Director, Victor H. Pinter, Vice President, and Melissa Brown, Vice President,
are the portfolio managers for the Large Cap Growth Fund. Mr. Jones joined GSAM
as a portfolio manager in 1989. Mr. Clark joined GSAM as a portfolio manager on
the quantitative equity management team in 1992.

Mr. Pinter joined GSAM in 1990 and become a portfolio manager in 1992. Ms. Brown
joined GSAM in 1998. From 1984 to 1998, she was the director of Quantitative
Equity Research and served on the Investment Policy Committee at Prudential
Securities.

BALANCED FUND -- J.P. MORGAN INVESTMENT MANAGEMENT INC.

J.P. Morgan Investment Management Inc. (J.P. Morgan), a wholly owned subsidiary
of J.P. Morgan & Co. Incorporated, serves as Subadviser to the Balanced Fund.
J.P. Morgan & Co. Incorporated is a bank holding company organized under the
laws of Delaware. J.P. Morgan offers a wide range of investment management
services and acts as investment adviser to corporate and institutional clients.
J.P. Morgan uses a sophisticated, disciplined, collaborative process for
managing all asset classes. As of December 31, 1999, J.P. Morgan had assets
under management of approximately $322 billion.

PORTFOLIO MANAGERS. Patrik Jakobson, Vice President, and Kathryn Jonas, Vice
President, are the portfolio managers for the Balanced Fund. Mr. Jakobson joined
J.P. Morgan in 1987, spending five years as a research analyst specializing in
the retailing industry. Subsequently, Mr. Jakobson managed equity and balanced
accounts and is currently responsible for managing global balanced portfolios.
He is also a member of the Asset Allocation Strategy group. Ms. Jonas joined
J.P. Morgan in 1997 after eleven years at Morgan Stanley & Co., where she was a
member of Morgan Stanley Asset Management's Emerging Markets investment team.
From 1985 to 1994, prior to joining Morgan Stanley Asset Management, Ms. Jonas
co-managed the Morgan Stanley Capital International Indices business.

SMALL CAP FUND -- INVESCO MANAGEMENT & RESEARCH, INC.

INVESCO MANAGES THE SMALL CAP FUND. INVESCO, which has been a registered
investment adviser since 1956, provides portfolio management for the Small Cap
Fund, including making investment decisions and placing purchase and sell order
for securities. As of December 31, 1999, INVESCO managed approximately $92
billion in investments for corporate and institutional clients, as well as other
investment companies.

INVESCO is a part of a global investment organization, AMVESCAP plc. AMVESCAP
plc is a public-traded holding company that, through its subsidiaries, engages
in the business of investment management on an international basis. AMVESCAP plc
managed approximately $357 billion as of December 31, 1999, through specialized
investment management teams dedicated to clients and financial markets in their
region of the world.

PORTFOLIO MANAGERS. The Small Cap Fund is managed by INVESCO's Structured
Products Group, which is comprised of 19 investment professionals, each with an
average of 18 years of industry experience. No individual member of the
Structured Products Team is primarily responsible for making recommendations
regarding portfolio purchases.

24
<PAGE> 74

INTERNATIONAL FUND -- LAZARD ASSET MANAGEMENT

Lazard Asset Management (LAM), a New York-based division of Lazard Freres & Co.
LLC (Lazard), a New York limited liability company, managed approximately $75
billion as of December 31, 1999, in investments for corporations, endowments,
public and private pension plans and wealthy individuals and is recognized as
one of the premier global investment advisory firms. Lazard -- the world's first
global investment bank -- has advised sophisticated investors for more than 150
years. Lazard has offices in New York and San Francisco, and affiliates in
London, Tokyo, Frankfurt, Sydney and Cairo that extend its research worldwide.

PORTFOLIO MANAGERS. LAM manages the International Fund on a team basis. The team
is involved in all levels of the investment process. This team approach allows
for every portfolio manager to benefit from his/her peers, and for clients to
receive the firm's best thinking, not that of a single portfolio manager. LAM's
international equity investment team operates under the guidance of Herbert
Gullquist, Vice Chairman and Chief Investment Officer of LAM with responsibility
for overall adherence to the firm's investment principles and John R. Reinsberg,
Managing Director of LAM, who is responsible for the team's day-to-day
operations and monitoring the International Fund's composition to ensure
appropriate diversification.

HISTORICAL PERFORMANCE OF THE SUBADVISERS

The following table shows the Funds' historical performance.

AVERAGE ANNUAL TOTAL RETURNS -- CLASS A SHARES(1)

(FOR THE PERIOD ENDING DECEMBER 31, 1999)

<TABLE>
<CAPTION>
One Since
Fund Year Inception
- ------------------------------------------------------------
<S> <C> <C>
Large Cap Value -10.17% -4.29%
............................................................
Large Cap Growth 26.81% 39.43%
............................................................
Balanced 2.89% 8.89%
............................................................
Small Cap 11.83% 18.34%
............................................................
International 14.14% 17.49%
</TABLE>

- ---------------

(1) These returns reflect performance after sales charges and expenses are
deducted.

(2) Each of the funds commenced operations on November 2, 1998.

Although the Funds have been operating for only a limited time, the subadvisers
have managed similar mutual funds or institutional accounts for a longer period.
These other mutual funds or institutional accounts have investment objectives,
policies and strategies that are substantially similar, but not necessarily
identical, to those of the Funds. We have included composite performance for all
of the substantially similar mutual funds or institutional accounts previously
managed by each Subadviser for comparison purposes. THESE OTHER MUTUAL FUNDS AND
INSTITUTIONAL ACCOUNTS ARE SEPARATE AND DISTINCT FROM EACH FUND. THEIR
PERFORMANCE DOES NOT GUARANTEE SIMILAR RESULTS FOR A FUND AND SHOULD NOT BE
VIEWED AS A SUBSTITUTE FOR A FUND'S OWN PERFORMANCE.

The performance of similar mutual funds or institutional accounts managed by the
Subadvisers may not be comparable to the performance of a Fund because of the
following differences:

- brokerage commissions and dealer spreads
- expenses (including management fees)
- the size of the investment in a particular security in relation to the
portfolio size
- the timing of purchases and sales (including the effect of market conditions
at that time)
- the timing of cash flows into the portfolio
- the availability of cash for new investments.

The historical performance that relates only to institutional accounts
(including institutional accounts that are included in composite performance),
may not be comparable to the performance of the Funds because, unlike the Funds,
the institutional accounts may not be required to do the following:

- redeem shares upon request
- meet the same diversification requirements as mutual funds
- follow the same tax restrictions and investment limitation as mutual funds.

The performance of the institutional accounts is calculated by combining the
performance of all similarly managed accounts into a composite. One Subadviser
also manages similar mutual funds, in this case, the composite includes the
performance of institutional accounts and mutual funds. If the accounts within
each composite had been subject to the same expenses as each Fund, their
performance would have been lower. As indicated below, the composite performance
has been prepared in compliance with the Performance Presentation Standards of
the Association for Investment Management and Research (AIMR Standards), which
are different from the performance methodology used by regis-

25
<PAGE> 75

Management

tered investment companies like the Funds. AIMR has not been involved with the
preparation or review of this information.

Average annual total return represents the average change over a specified
period of time in the value of an investment after reinvesting all income and
capital gains distributions.

The historical performance information has been provided by each subadviser. The
Funds believe that it is reliable, but the Funds have not independently verified
it.

BRINSON PARTNERS, INC. Brinson Partners is Subadviser to the Large Cap Value
Fund. The following sets forth composite performance data relating to the
historical performance of institutional private accounts managed by UBS Brinson,
Inc./ Brinson Partners, Inc., which is comprised of Brinson Partners, and its
affiliates in London and New York. The composite performance data includes all
accounts managed and administered from UBS Brinson, Inc./Brinson Partners,
Inc.'s Chicago, London and New York offices, with substantially similar
objectives, policies and strategies. All accounts in the Brinson U.S. Value
Equity Composite below are managed by the same individuals as those who manage
the Fund's accounts through Brinson Partners, Inc. The data has been prepared
and presented in compliance with the AIMR Standards. AIMR has not been involved
with the preparation or review of this report. The effective date of UBS
Brinson, Inc./Brinson Partners, Inc., compliance with the AIMR Standards is
January 1, 1993. Additional information concerning the composites, their
performance and how they were calculated is contained in the SAI.

The data is provided to illustrate the past performance of UBS Brinson,
Inc./Brinson Partners, Inc. in managing investment portfolios which are
substantially similar to the Large Cap Value Fund. The total return figures
include reinvestment of earnings and are shown before the deduction of custody
fees, but are net of investment advisory fees calculated at 0.75%, the highest
fee charged for accounts of this type since January 1989. These fees are lower
than the total annual operating expenses of each class of the Large Cap Value
Fund.

AVERAGE ANNUAL TOTAL RETURN

BRINSON U.S. VALUE EQUITY COMPOSITE

<TABLE>
<CAPTION>
For Years Ended December 31,
1999
One
Year Since Inception*
- ---------------------------------------------------------------
<S> <C> <C>
Composite Gross of Fees.......... -0.25% 2.13%
Composite Net of Fees............ -0.99% 1.37%
Russell 1000 Value Index......... 7.33% 6.98%
</TABLE>

- ---------------

* Composite inception date is June 30, 1998.

The composite performance information presented above is derived from the
performance of all substantially similar managed portfolios. The Brinson U.S.
Value Equity Composite is a composite of accounts that invest in stocks of the
largest U.S. companies with the strongest value characteristics.

26
<PAGE> 76

GOLDMAN SACHS ASSET MANAGEMENT. GSAM is the subadviser for the Large Cap Growth
Fund. The following chart shows the average annual total returns of the Goldman
Sachs Large Cap Growth Composite. All of the accounts (including the mutual
funds managed in this style) managed by GSAM with objectives, policies and
strategies substantially similar to those of the Large Cap Growth Fund are
included in the composite. The historical investment performance of the
composite reflects the deduction of 1.20%, which is the total expense ratio of
the Class A shares of the Large Cap Growth Fund and reflects the highest level
of fees of the portfolios in the composite. GSAM prepared this performance
information in compliance with AIMR Standards.

AVERAGE ANNUAL TOTAL RETURN

GOLDMAN SACHS LARGE CAP GROWTH COMPOSITE

<TABLE>
<CAPTION>
For Years Ended December 31, 1999
Since
One Year Three Years Five Years inception*
- ------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Returns reflect
deduction of maximum
sales charge for
Class A shares of the
Large Cap Growth
Fund(1) 27.82% 29.00% 30.50% 22.53%
........................................................................
Returns do not reflect
sales charges 35.13% 31.40% 32.02% 23.31%
</TABLE>

- ---------------

* Composite inception date is December 1, 1991.

(1) The maximum sales charge for Class A Shares of the Large Cap Growth Fund is
5.75%. This sales charge has been deducted from the returns of the composite,
although most of the accounts in the composite would not be subject to sales
charges.

J.P. MORGAN INVESTMENT MANAGEMENT INC. J.P. Morgan is the subadviser for the
Balanced Fund. The following chart shows the average annual total returns of the
J.P. Morgan Balanced Commingled Account Composite. All of the accounts managed
by J.P. Morgan with objectives, policies and strategies substantially similar to
those of the Balanced Fund are included in the composite. The historical
investment performance of the composite reflects the deduction of investment
advisory fees of 0.60% which is the maximum fee charged by J.P. Morgan for the
accounts included in the composite, but does not include the deduction of
custody fees. These fees are lower than the total annual operating expenses of
each class of the Balanced Fund. J.P. Morgan prepared this performance
information in compliance with AIMR Standards.

AVERAGE ANNUAL TOTAL RETURN

J.P. MORGAN BALANCED COMMINGLED ACCOUNT COMPOSITE

<TABLE>
<CAPTION>
For Years Ended December 31, 1999
One Year Three Years Five Years Ten Years
- ----------------------------------------------
<S> <C> <C> <C>
10.57% 17.16% 18.88% 13.87%
</TABLE>

INVESCO, INC. INVESCO is the subadviser for the Small Cap Fund. The following
chart shows the average annual total returns of the INVESCO Structured Small Cap
Equity Composite. All of the accounts managed by INVESCO with objectives,
policies and strategies substantially similar those of the Small Cap Fund are
included in the composite. The historical investment performance of the
composite reflects the deduction of investment advisory fees (assuming an
investment advisory fee of 1% annually and reflecting the deduction of 1/12th of
1% each month), but does not include the deduction of custody fees; this is the
maximum fee charged for the accounts in the composite. These fees are lower than
the total annual operating expenses of the Small Cap Fund. INVESCO prepared this
performance each class of information in compliance with AIMR Standards.

AVERAGE ANNUAL TOTAL RETURN

INVESCO STRUCTURED SMALL CAP EQUITY COMPOSITE

<TABLE>
<CAPTION>
For Years Ended December 31, 1999Since
One Year Three Years Five Years inception*
- ----------------------------------------------------
<S> <C> <C> <C>
17.91% 12.51% 17.53% 15.97%
</TABLE>

- ---------------

*Composite inception date is April 1, 1992.

LAZARD ASSET MANAGEMENT. Lazard is the subadviser for the International Fund.
The following chart shows the average annual total returns of the Lazard
International Equity Composite. All of the accounts managed by Lazard with
objectives, policies and strategies substantially similar to those of the
International Fund are included in the composite. The historical investment
performance of the composite reflects the deduction of investment advisory fees
(which is a maximum of 0.75% annually) but does not include the deduction of
custody fees. These fees are lower than the total annual operating expenses of
each class of the International Fund. Lazard prepared this performance
information in compliance with AIMR Standards.

AVERAGE ANNUAL TOTAL RETURN

LAZARD INTERNATIONAL EQUITY COMPOSITE

<TABLE>
<CAPTION>
For Years Ended December 31, 1999
One Year Three Years Five Years Ten Years
- -----------------------------------------------
<S> <C> <C> <C>
26.97% 17.55% 16.29% 11.89%
</TABLE>

27
<PAGE> 77

BUYING, SELLING AND EXCHANGING FUND SHARES

CHOOSING A SHARE CLASS

As noted in the Fund Summaries, the Funds offer three different share classes to
give investors different price and cost options. Class A and Class B shares of
the Funds are available to all investors; Institutional Service Class shares are
available to a limited group of investors.

With Class A shares, you pay a sales charge (known as a front-end sales charge)
when you purchase the shares; and with Class B shares, you pay a sales charge
(known as a contingent deferred sales charge or CDSC) if you sell your shares
within six years after purchase. Sales charges are paid to Nationwide Advisory
Services, Inc. (NAS), which either retains them or pays a selling
representative. There is no such charge on Institutional Service Class shares.

Class A and Class B shares pay distribution and/or service fees under a
Distribution Plan. These fees are retained by NAS or paid by NAS to brokers for
distribution and shareholder services. Class A and Institutional Service Class
shares may pay administrative service fees. These fees are paid to brokers and
other entities who provide administrative support services to the beneficial
owners of the shares.

If you want lower annual fund expenses, Class A shares may be right for you,
particularly if you qualify for a reduction or waiver of sales charges. If you
do not want to pay an up-front sales charge, and you anticipate holding your
shares for the long term, Class B shares may be more appropriate.

As the Fund's principal distributor, NAS reserves the right to reject an order
in excess of $100,000 for Class B shares and an order for Class B shares for
Individual Retirement Accounts (IRA accounts) for shareholders 70 1/2 years old
and older.

When choosing a share class, consider the following:

<TABLE>
<CAPTION>
Class A shares Class B shares
- ----------------------------------------------------------
<S> <C>
Front-end sales charge means No front-end sales charge,
that a portion of your so your full investment
initial investment goes immediately goes toward
toward the sales charge, and buying shares
is not invested
..........................................................
Reductions and waivers of No reductions of the CDSC
the sales charges available available, but waivers
available
..........................................................
Lower expenses than Class B Higher distribution and
shares means higher service fees than Class A
dividends per share shares mean lower dividends
per share
</TABLE>

<TABLE>
<CAPTION>
Class A shares Class B shares
- ----------------------------------------------------------
<S> <C>
Conversion features are not After seven years, Class B
applicable shares convert into Class A
shares, which reduces your
future Fund expenses
..........................................................
No sales charges when shares CDSC if shares are sold
are sold back to the Fund* within six years: 5% in the
first year, 4% in the
second, 3% in the third and
fourth years, 2% in the
fifth, and 1% in the sixth
year
</TABLE>

- ---------------
* A CDSC of up to 1% may be charged on certain redemptions of Class A shares
purchased without a sales charge.

For investors who are eligible to purchase Institutional Service Class shares,
the purchase of Institutional Service Class shares will be preferable to
purchasing Class A or Class B Shares.

WHO CAN BUY INSTITUTIONAL SERVICE CLASS SHARES

The Institutional Service Class shares are available for purchase only by the
following:
- retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
roll-over individual retirement accounts from such plans
- tax-exempt employee benefit plans for which third party administrators
provide recordkeeping services and are compensated by the Fund for such
services
- a bank, trust company or similar financial institution investing for its
own account or for the account of its trust customers for whom such
financial institution is exercising investment discretion in purchasing
Institutional Service Class shares, where the investment is part of a
program that collects an administrative service fee
- registered investment advisers investing on behalf of institutions and
high net-worth individuals where the adviser is compensated by the Fund
for services it provides
- life insurance separate accounts to fund the benefits of variable annuity
contracts issued to governmental entities as an investment option under
their deferred compensation plans as defined under Section 457 of the
Internal Revenue Code (the Code) or qualified plans adopted pursuant to
Section 401(a) of the Code.

28
<PAGE> 78

BUYING SHARES

PURCHASE PRICE. The purchase or "offering" price of one share of a Fund is its
"net asset value" (NAV) next determined after the order is received, plus any
applicable sales charge. A separate NAV is calculated for each class of a Fund.
Generally, the NAV is based on the market value of the securities owned by the
Fund less its liabilities. The NAV for a class is determined by dividing the
total market value of the securities owned by a Fund, allocable to such class,
less liabilities allocable to a class, by the total number of that class'
outstanding shares. NAV is determined at the earlier of the close of regular
trading on the New York Stock Exchange (usually 4 p.m. Eastern Time) on each day
the Exchange is open for trading.

MINIMUM INVESTMENTS --

CLASS A AND CLASS B SHARES

To open an account (per Fund) $1,000

................................................................................
Through the Automatic Asset
Accumulation plan per transaction $25
................................................................................
Additional investments (per Fund) $100
................................................................................

MINIMUM INVESTMENT --

INSTITUTIONAL CLASS SHARES

To open an account (per Fund) $50,000

Additional investments (per Fund) $5,000

- -------------------------------------

If you purchase Class A or Class B shares through an account at a broker (other
than NAS), different minimum account requirements may apply.

These minimum investment requirements for Class A shares do not apply to certain
retirement plans. Call 1-800-848-0920 for more information.

The Funds do not calculate NAV on the following days:
- Christmas Day
- New Year's Day
- Martin Luther King, Jr. Day
- Presidents' Day
- Good Friday
- Memorial Day
- Independence Day
- Labor Day
- Thanksgiving Day
- Other days when the New York Stock Exchange is not open.

Each Fund reserves the right not to determine an NAV when:

- It has not received any orders to purchase, sell or exchange shares

- Changes in the value of a Fund's portfolio do not affect the NAV.

If current prices are not available, or if Villanova SA Capital Trust (VSA), as
the Fund's administrator or its agent, determines a price does not represent
fair value, a Fund's investments may be valued at fair value in accordance with
procedures adopted by the Board of Trustees. To the extent that a Fund's
investments are traded in markets that are open when the New York Stock Exchange
is closed, the value of the Fund's investments may change on days when shares
cannot be purchased or redeemed.

CLASS A SALES CHARGES

The chart below shows the Class A sales charges, which decrease as the amount of
your investment increases.

<TABLE>
<CAPTION>
Sales charge
Sales charge as % of
as % of amount
Amount of purchase offering price invested
- ------------------------------------------------------------------
<S> <C> <C>
Less than $50,000 5.75% 6.10%
..................................................................
$50,000 to $99,999 4.50 4.71
..................................................................
$100,000 to $249,999 3.50 3.63
..................................................................
$250,000 to $499,999 2.50 2.56
..................................................................
$500,000 to $999,999 2.00 2.04
..................................................................
$1 million to $24,999,999 0.50 0.50
..................................................................
$25 million or more 0.25 0.25
</TABLE>

REDUCTION AND WAIVER OF CLASS A SALES CHARGES

Shareholders can reduce or eliminate Class A shares' initial sales charge
through one or more of the discounts described below:

- Increase the amount of your investment. The table above shows how the sales
charge decreases as the amount of your investment increases.

- Family Member Discount. Members of your family who live at the same address
can combine investments, possibly reducing the sales charge.
- Lifetime Additional Discount. You can add the value of any of the
Nationwide Mutual Funds Class A shares you already own with the value of the
shares you are purchasing, which may reduce the applicable sales charge.
- Insurance Proceeds or Benefits Discount Privilege. If you use the proceeds
of an insurance policy issued by any member of the Nationwide Insurance
Enterprise to purchase Class A shares, you will pay one-half of the

29
<PAGE> 79

Buying, Selling and Exchanging Fund Shares

published sales charge if you make your investment 60 days after receiving the
proceeds.
- No sales charge on a repurchase. If you sell shares from your Nationwide
account, we allow you a one-time privilege to reinvest some or all of the
proceeds in shares of the same class. You will not pay a sales charge on
Class A shares that you buy within 30 days of selling Class A shares of an
equal or lesser amount if you have already paid a sales charge. Remember, if
you realize a gain or a loss on your sale of shares, the transaction is
taxable and reinvestment will not affect the amount of capital gains tax
that is due. If you realize a loss on your sale and your reinvest, some or
all of the loss may not be allowed as a tax deduction depending on the
amount you reinvest.
- Letter of Intent Discount. State in writing that during a 13-month period
you or a group of family members who live at the same address will purchase
or hold at least $50,000 in Class A shares and your sales charge will be
based on the total amount you intend to invest. The letter may be backdated
up to 90 days to include previous purchases for determining your sales
charge. Your Letter of Intent is not a binding obligation to buy shares of a
Fund; it is merely a statement of intent. Call 1-800-0920 for more
information.

WAIVER OF CLASS A SALES CHARGES

The Class A sales charges will be waived for purchases made by the following:

- Any person purchasing through an account with an unaffiliated brokerage firm
that has an agreement with NAS to waive sales charges for those persons;
- Directors, officers, full-time employees, sales representatives and their
employees or any investment advisory clients of a broker-dealer having a
dealer/selling agreement with NAS;
- Any person who pays for the shares with the proceeds of a sale of
non-Nationwide mutual fund shares. To qualify, you must have paid an initial
sales charge on the shares sold. You must purchase the Class A shares within
60 days of the sale, and you must request the waiver when you purchase the
Class A shares (NAS may require evidence that you qualify for this waiver);
- Employer-sponsored retirement plans, including pension, profit sharing or
deferred compensation plans which are qualified under sections 401(a),
403(b) or 457 of the Internal Revenue Code;
- Trustees and retired Trustees of Nationwide Mutual Funds (including its
predecessor Trusts);

- Directors, officers, full-time employees, sales representatives and their
employees, and retired directors, officers, employees, and sales
representatives, their spouses, children or immediate relatives (including
mother, father, brothers, sisters, grandparents and grandchildren) and
immediate relatives of deceased employees of any member of Nationwide
Insurance and Nationwide Financial companies, or any investment advisory
clients of VMF, VSA, NAS and their affiliates; and

- Directors, officers, full-time employees, their spouses, children or
immediate relatives and immediate relatives of deceased employees of any
sponsor group which may be affiliated with the Nationwide Insurance and
Nationwide Financial companies from time to time, (including but not limited
to, Farmland Insurance Industries, Inc., Maryland Farm Bureau, Inc., Ohio
Farm Bureau Federation, Inc., Pennsylvania Farmers' Association, Ruralite
Services, Inc., and Southern States Cooperative).

Additional investors eligible for sales charge waivers may be found in the SAI.

CONVERSION OF CLASS B SHARES

After you have held your Class B shares for seven years, we will automatically
convert them into Class A shares (without charge), which carry the lower 12b-1
fee. We will also convert any Class B shares that you purchased with reinvested
dividends and other distributions for those shares at that time. Remember,
because the NAV of Class A shares is usually higher than the NAV of Class B
shares, you may receive fewer Class A shares than the number of Class B shares
converted, but the total dollar value will be the same. We do the conversion on
the first business day of the month following the seventh anniversary of the
date of your purchase.

30
<PAGE> 80

HOW TO PLACE YOUR PURCHASE ORDER

If you wish to purchase Class A or Class B shares, you may purchase the shares
using one of the methods described below. Eligible entities wishing to purchase
Institutional Service Class shares should contact NAS at 1-800-848-0920 for
information regarding such purchases.

BY MAIL -- Complete and mail the application with a check or money order made
payable to; Nationwide Advisory Services, Inc., P.O. Box 1492, Columbus, Ohio
43216-1492. Payment must be made in U.S. dollars only and drawn on a U.S. bank.
NAS will not accept third-party checks.

BY WIRE -- You can request that your bank transmit funds (federal funds) by wire
to the Funds' custodian bank. In order to use this method, you must call NAS by
4 p.m. Eastern Time, and the wire must be received by the custodian bank by the
close of business on the day you placed your order or your order will be
cancelled. You may be liable for any loss to a Fund resulting from the
cancellation. Please note that your bank may charge a fee to wire funds. If you
choose this method to open your account, you must call our toll-free number
before you wire your investment, and you must then complete and fax the
application.

BY TELEPHONE (NAS NOW) -- Call 1-800-637-0012, our automated voice-response
system, 24 hours a day, seven days a week, for easy access to mutual fund
information. You can choose from a menu of choices to conduct transactions and
hear Fund price information, mailing and wiring instructions and other mutual
fund information. You must complete the appropriate section of the application
to use NAS NOW to make purchases.

THROUGH AN AUTHORIZED BROKER -- NAS has relationships with certain brokers and
other financial intermediaries who are authorized to accept, or designate
intermediaries to accept, purchase and redemption orders for the Funds. If you
purchase through such a broker, your order will be priced at the NAV next
determined after your broker or its designated intermediary accepts it. Contact
your broker to determine whether it has an established relationship with NAS.

BY ON-LINE ACCESS -- Log on to our website www.nationwidefunds.com 24 hours a
day, seven days a week, for easy access to your mutual fund accounts. Once you
have reached the website, you will be instructed on how to select a password and
perform transactions. You can choose to receive information on all transactions,
such as purchases, redemptions and exchanges. A Fund may terminate the ability
to buy Fund shares on this website at any time, in which case you may continue
to buy shares by mail, wire, telephone or through an authorized broker as
described in this Prospectus.

ADDITIONAL SHAREHOLDER SERVICES

Shareholders are entitled to a wide variety of services by contacting:

NAS NOW 1-800-637-0012

Our customized voice-response system, available 24 hours a day, seven days a
week

CUSTOMER SERVICE 1-800-848-0920

Representatives are available to answer questions between 8 a.m. and 5 p.m.
Eastern Time. (Monday through Friday, except Thursday, in which case
representatives are available between 9:30 a.m. and 5 p.m. Eastern Time.)

For additional information on buying shares and shareholder services, call our
customer service number listed above or contact your sales representative.

SELLING SHARES

You can sell -- also known as redeeming -- your shares of the Funds at any time,
subject to certain restrictions described below. The price you will receive when
you sell your shares will be the NAV (less any applicable sales charges) next
determined after NAS receives your properly completed order to sell in its
offices in Columbus, Ohio. Of course, the value of the shares you sell may be
more or less than you paid for the shares depending upon the market value of a
Fund's investments at the time of the sale.

Properly completed orders contain all necessary paperwork to authorize and
complete the transaction. NAS may require all account holder signatures, updated
account registration and bank account information and, depending on
circumstances, a signature guarantee.

Your order to sell shares can be made in writing or by telephone (if you
authorized telephone transactions on your application) or by on-line access.
Generally, we will pay you for the shares that you sell within three days after
receiving your order to sell. Payment for shares you recently purchased by check
may be delayed until the check clears,

31
<PAGE> 81

Buying, Selling and Exchanging Fund Shares

which may take up to 10 business days from the date of your purchase.

RESTRICTIONS ON SALES

You may not be able to sell your shares of the Funds or we may delay paying you
the proceeds from a sale when the New York Stock Exchange is closed (other than
customary weekend and holiday closings) or if trading is restricted or if an
emergency exists.

SIGNATURE GUARANTEE -- CLASS A AND CLASS B SHARES

A signature guarantee is required under the following circumstances:

- if a redemption is over $100,000, or

- if your account registration has changed within the last 30 days, or

- if the redemption check is made payable to anyone other than the registered
shareholder, or

- if the proceeds are sent to a bank account not previously designated or
changed within the past 30 days, or

- if the proceeds are mailed to an address other than the address of record.

NAS reserves the right to require a signature guarantee in other circumstances,
without notice.

CONTINGENT DEFERRED SALES CHARGE (CDSC) ON CLASS A AND CLASS B SHARES

You must pay a CDSC if you sell Class B shares within six years of purchase,
unless you are entitled to a waiver. The sales charge applies if your sale
causes the value of Class B shares in your account to fall below the total
amount of all purchases of Class B shares you made during the preceding six
years. The sales charge is applied to your original purchase price, or the
current market value of the shares being sold, whichever is less. The amount of
the sales charge will decrease as illustrated in the following chart:

<TABLE>
<CAPTION>
1 2 3 4 5 6 7
Sale within year years years years years years years or more
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Sales charge 5% 4% 3% 3% 2% 1% 0%
</TABLE>

All purchases during the month are grouped together and will be treated as if
made on the last day of the preceding month.

We do not impose a CDSC on Class B shares purchased through reinvested dividends
and distributions. If you sell your Class B shares and reinvest the proceeds in
Class B shares within 30 days, NAS will deposit an amount equal to any CDSC you
paid into your account. Also, we will waive the CDSC if you sell shares
following the death or disability of a shareholder, provided the sale occurs
within one year of the shareholder's death or a determination of disability and
for mandatory withdrawals from IRA accounts after age 70 1/2 years. For more
information, see the SAI.

Under certain circumstances, employer-sponsored retirement plans investing in
Class A shares without a sales charge (other than those investing in the Fund
through variable insurance products) may be charged a CDSC if shares are
redeemed within three years after purchase. The CDSC will be 1% for the first
year, 0.50% for the second year and 0.25% for the third year.

HOW TO PLACE YOUR SALE ORDER

You can request the sale of your Class A or Class B shares in any of the ways
described below. A signature guarantee may be required under certain
circumstances. Please refer to the section above entitled "Signature
guarantee -- Class A and Class B shares". Eligible entities wishing to sell
Institutional Service Class shares should contact NAS at 1-800-848-0920 for
information regarding such sales.

BY TELEPHONE (NAS NOW) -- Calling 1-800-637-0012 connects you to our automated
voice-response system, available 24 hours a day, seven days a week, for easy
access to mutual fund information. You can sell shares and have the check mailed
to your address of record, unless you declined this option on your application.
Only the following types of accounts can use NAS NOW to sell shares: Individual,
Joint, Transfer on Death, Trust, and Uniform Gift/Transfer to Minor accounts.
You can call 1-800-637-0012 after 7 p.m. Eastern Time to learn the day's closing
share price.

CAPITAL GAINS TAXES

If you sell Fund shares for more than you paid for them, you may have capital
gains, which are subject to federal (and in some cases, state) income tax. For
more information, see "Distributions and Taxes -- Selling Fund Shares" on page
36. [INSET BOX]

CUSTOMER SERVICE LINE -- Unless you declined the telephone redemption privilege
on your application, a check payable to the shareholder of record can be mailed
to the address of record. You can sell shares of your IRA by telephone if we
receive the proper forms. The distribution from an IRA will be

32
<PAGE> 82

subject to a mandatory 10% federal withholding tax, unless you inform us in
writing not to withhold taxes. For additional information or to request the
forms, please call the customer service line at 1-800-848-0920. The Funds will
use procedures to confirm that telephone instructions are genuine. If the Funds
act on instructions they reasonably believed were genuine, they will not be
liable for any loss, injury, damage or expense that occurs as a result, and the
Funds will be held harmless for any loss, claims or liability arising from their
compliance with the instructions. NAS may record telephone instructions to sell
shares. The Funds reserve the right to revoke this privilege at any time,
without notice to shareholders, and to request the sale in writing, signed by
all shareholders on the account.

BY AUTOMATED CLEARING HOUSE (ACH) -- Your funds can be sent to your bank via ACH
on the second business day after your order to sell has been received by NAS.
Funds sent through ACH should reach your bank in two business days. There is no
fee for this service. (This authorization will remain in effect until you give
NAS written notice of its termination.)

THROUGH AN AUTHORIZED BROKER -- NAS has relationships with certain brokers and
other financial intermediaries who are authorized to accept, or designate
intermediaries to accept, purchase and redemption orders for the Funds. If you
have an account with such a broker, your redemption order will be priced at the
NAV next determined after your order has been accepted by your broker or its
designated intermediary. Your broker or financial intermediary may charge a fee
for this service.

BY ON-LINE ACCESS -- Log on to our website www.nationwidefunds.com 24 hours a
day, seven days a week, for easy access to your mutual fund accounts. Once you
have reached the website, you will be instructed on how to select a password and
perform transactions. You can choose to receive information on all of our funds
as well as your own personal accounts. You may also perform transactions, such
as purchases, redemptions and exchanges. A Fund may terminate the ability to
sell Fund shares on this website at any time, in which case you may continue to
sell shares by mail, wire, telephone or through an authorized broker as
described in this Prospectus.

ACCOUNTS WITH LOW BALANCES -- CLASS A AND B SHARES

We may sell the rest of your shares and close your account if you make a sale
that reduces the value of your account to less than $250. Before the account is
closed, we will give you notice and allow you 90 days to purchase additional
shares to avoid this action. We do this because of the high cost of maintaining
small accounts. This does not apply to Automatic Asset Accumulation accounts.

For additional information on selling your shares, call our customer service
line at 1-800-848-0920 or contact your sales representative.

DISTRIBUTION PLAN

In addition to the sales charges which you may pay for Class A and Class B
shares, the Trust has adopted a Distribution Plan under Rule 12b-1 of the
Investment Company Act, which permits the Class A and Class B shares of the
Funds to compensate NAS -- as distributor -- for expenses associated with
distributing their shares and providing shareholder services.

DISTRIBUTION AND SERVICE FEES

Under the Distribution Plan, Class A and Class B shares of a Fund pays NAS
compensation accrued daily and paid

33
<PAGE> 83

Buying, Selling and Exchanging Fund Shares

monthly. Each Fund shall pay amounts not exceeding an annual amount of:

<TABLE>
<CAPTION>
CLASS AS A % OF DAILY NET ASSETS
- ----------------------------------------------------------------
<S> <C>
Class A shares 0.25% (distribution or service fee)
................................................................
Class B shares 1.00% (0.25% service fee)
</TABLE>

EXCHANGING SHARES

You can exchange the shares you own for shares of another fund within Nationwide
Mutual Funds (except the Morley Capital Accumulation Fund) so long as they are
the same class of shares, both accounts have the same owner, and your first
purchase in the new fund meets the fund's minimum investment requirement. For
example, you can exchange Class A shares of one fund for Class A shares of
another, but you can not exchange Class A shares for Class B shares or
Institutional Service Class shares.

CAPITAL GAINS TAXES

There is no sales charge for exchanges of Class B shares or Institutional
Service Class shares. However, if your exchange involves certain Class A shares,
you may have to pay the difference between the sales charge if a higher sales
charge applies. If you exchange Prime Shares of the Nationwide Money Market Fund
into another fund, you must pay the applicable sales charge, unless it has
already been paid. If you exchange Class B shares for Prime Shares of the
Nationwide Money Market Fund, the time you hold the shares in the Nationwide
Money Market Fund will not be counted for purposes of calculating any CDSC. If
you then sell your Prime Shares of the Nationwide Money Market Fund, you will
pay the sales charge that would have been charged if the shares had been sold at
the time they were exchanged into the Nationwide Money Market Fund. If you
exchange your Prime Shares of the Nationwide Money Market Fund back into Class B
shares, the time you hold Class B shares prior to the exchange will be counted
for purposes of calculating the CDSC.

HOW TO PLACE YOUR EXCHANGE ORDER

You can request an exchange of shares in writing, by fax or by phone or by
on-line access (see "Buying Shares -- How to place your purchase order" on page
31 or the back cover for contact information). If you make your request in
writing, please be sure all account owners sign the letter. Your exchange will
be processed on the date NAS receives your signed letter or fax. If your fax is
received after 4 p.m. Eastern Time, it will be processed the next day. If you
fax your request, we reserve the right to ask for the original. You can
automatically request an exchange 24 hours a day, seven days a week, by calling
NAS NOW, our automated voice-response system or by logging on to our website.
You will have automatic exchange privileges unless you request not to on your
application. The Trust reserves the right to amend or discontinue these exchange
privileges upon 60 days written notice to shareholders.

EXCESSIVE TRADING

The Trust reserves the right to reject any exchange request it believes will
increase transaction costs, or otherwise adversely affect other shareholders.
Specifically, exchange activity may be limited to 12 exchanges within a one year
period or 1% of the Fund's NAV. A Fund may delay forwarding redemption proceeds
for up to seven days if the investor redeeming shares is engaged in excessive
trading, or if the amount of the redemption request otherwise would be
disruptive to efficient portfolio management, or would adversely affect the
Fund.

34
<PAGE> 84

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS OF INCOME DIVIDENDS

Each quarter, each Fund distributes any available income dividends to
shareholders. Income dividends are taxable to you as ordinary income for federal
income tax purposes, unless you hold your shares in a qualified tax-deferred
plan or account, or are otherwise not subject to federal income tax. The amount
of income dividends distributed to you will be reported in a Form 1099, which we
will send to you during the tax season each year (unless you hold your shares in
a qualified tax-deferred plan or account or are otherwise not subject to federal
income tax). For corporate shareholders, a portion of each year's distributions
may be eligible for the corporate dividend-received deduction.

DISTRIBUTIONS OF CAPITAL GAINS

If a Fund has net realized capital gains at the end of the fiscal year (meaning
the gains from sales of securities exceed any losses from sales), it will
distribute this capital gain to shareholders annually. You must pay federal
income taxes on any capital gains distributed to you, unless you hold your
shares in a qualified tax-deferred plan or account or are otherwise not subject
to federal income tax. On Form 1099, we will report the amount of net short-term
capital gains and net long-term capital gains distributed to you during the
year. Currently, for individuals, long-term capital gains are taxed at a maximum
rate of 20%; short-term capital gains are taxed as ordinary income, such as
interest or dividends. For more information regarding capital gains tax rates,
speak with your tax adviser.

REINVESTING DISTRIBUTIONS

All income and capital gains distributions will be reinvested in shares of the
applicable Fund. You may request a payment in cash in writing if distributions
are in excess of $5. You may be subject to tax on reinvested distributions. If
distribution checks (1) are returned and marked as "undeliverable" or (2) remain
uncashed for six months, your account will be changed automatically so that all
future distributions are reinvested in your account. Checks that remain uncashed
for six months will be canceled and the money reinvested in the Fund as of the
cancellation date. No interest is paid during the time the check is outstanding.

CHANGING YOUR DISTRIBUTION OPTION

If you want to change your distribution option, you must notify us by the record
date for a dividend or distribution in order for it to be effective for that
dividend or distribution. [INSET BOX]

STATE AND LOCAL TAXES

Distributions may be subject to state and local taxes, even if not subject to
federal income taxes. State and local tax laws vary; please consult your tax
adviser.

SELLING FUND SHARES

Selling Fund shares for more than you paid for them give you a capital gain,
which is subject to federal income tax. The amount of tax depends on how long
you held your shares. For individuals, long-term capital gains are currently
taxed at a maximum rate of 20%; and short-term capital gains are taxed as
ordinary income, such as interest or dividends. Capital gains from your sale of
Fund shares is not reported on Form 1099; you or your tax adviser should keep
track of your purchases, sales, and any resulting gain or loss. If you do sell
Fund shares for a loss, you may be able to sue this capital loss to offset any
capital gains you have.

EXCHANGING FUND SHARES

Exchanging your shares of a Fund is considered a sale for income tax purposes.
Therefore, if the shares you exchange are worth more than you paid for them, you
have capital gains, which are subject to the federal income taxes described
above. If you exchange Fund shares for a loss, you may be able to use this
capital loss to offset any capital gains you have.

35
<PAGE> 85

FINANCIAL HIGHLIGHTS

The financial highlights tables are intended to help you understand the Funds'
financial performance for the period of each Fund's operation. Certain
information reflects financial results for a single Fund share. The total
returns in the tables represent the rate that an investor would have earned or
lost on an investment in the Fund (assuming reinvestment of all dividends and
distributions and no sales charges). This information has been audited by KPMG
LLP, whose report, along with the Fund's financial statements, are included in
the annual report, which is available upon request.

LARGE CAP VALUE FUND

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
---------------------------------------------------------
INSTITUTIONAL SERVICE
CLASS A SHARES CLASS B SHARES CLASS SHARES
-------------- -------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $ 10.00 $10.00 $10.00
Net investment income (loss) 0.07 (0.02) 0.08
Net realized gain (loss) and unrealized appreciation
(depreciation) 0.32 0.27 0.33
------- ------ ------
Total from investment operations 0.39 0.25 0.41
------- ------ ------
Dividends from net investment income (0.07) (0.01) (0.06)
Total distributions (0.07) (0.01) (0.06)
------- ------ ------
Net increase in net asset value 0.32 0.24 0.35
------- ------ ------
NET ASSET VALUE -- END OF PERIOD $ 10.32 $10.24 $10.35
======= ====== ======
Total Return (excluding sales charges) 3.86% 2.50% 4.05%
Ratios and supplemental data:
Net Assets, end of period (000's) $25,883 $ 155 $ 755
Ratio of expenses to average net assets(b) 1.15% 1.90% 1.00%
Ratio of expenses to average net assets*(b) 1.87% 5.34% 4.21%
Ratio of net investment income to average net assets(b) 0.85% (0.13)% 0.77%
Ratio of net investment income to average net assets*(b) 0.13% (3.57)% (2.44)%
Portfolio turnover(c) 120.94% 120.94% 120.94%
</TABLE>

- ---------------

* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Prestige Large Cap Value Fund commenced operations on November 2, 1998.

(b) Annualized.

(c) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

36
<PAGE> 86

LARGE CAP GROWTH FUND

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
---------------------------------------------------------
INSTITUTIONAL SERVICE
CLASS A SHARES CLASS B SHARES CLASS SHARES
-------------- -------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $ 10.00 $10.00 $10.00
Net investment loss (0.04) (0.12) (0.01)
Net realized gain (loss) and unrealized appreciation
(depreciation) 3.62 3.62 3.61
------- ------ ------
Net increase in net asset value 3.58 3.50 3.60
------- ------ ------
NET ASSET VALUE -- END OF PERIOD $ 13.58 $13.50 $13.60
======= ====== ======
Total Return (excluding sales charges) 35.80% 35.00% 36.00%
Ratios and supplemental data:
Net Assets, end of period (000's) $33,410 $1,179 $4,594
Ratio of expenses to average net assets(b) 1.20% 1.95% 1.05%
Ratio of expenses to average net assets*(b) 1.69% 5.26% 3.46%
Ratio of net investment income to average net assets(b) (0.27)% (0.97)% (0.09)%
Ratio of net investment income to average net assets*(b) (0.76)% (4.28)% (2.49)%
Portfolio turnover(c) 65.27% 65.27% 65.27%
</TABLE>

- ---------------

* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Prestige Large Cap Growth Fund commenced operations on November 2, 1998.

(b) Annualized.

(c) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

37
<PAGE> 87

Financial Highlights

BALANCED FUND

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
---------------------------------------------------------
INSTITUTIONAL SERVICE
CLASS A SHARES CLASS B SHARES CLASS SHARES
-------------- -------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $10.00 $10.00 $10.00
Net investment income 0.22 0.13 0.22
Net realized gain (loss) and unrealized appreciation
(depreciation) 1.12 1.12 1.13
------ ------ ------
Total from investment operations 1.34 1.25 1.35
------ ------ ------
Dividends from net investment income (0.21) (0.05) (0.22)
Net increase in net asset value 1.13 1.20 1.13
------ ------ ------
NET ASSET VALUE -- END OF PERIOD $11.13 $11.20 $11.13
====== ====== ======
Total Return (excluding sales charges) 13.47% 12.54% 13.62%
Ratios and supplemental data:
Net Assets, end of period (000's) $2,532 $2,107 $3,080
Ratio of expenses to average net assets(b) 1.10% 1.85% 0.95%
Ratio of expenses to average net assets*(b) 3.44% 4.25% 3.30%
Ratio of net investment income to average net assets(b) 2.02% 1.25% 2.17%
Ratio of net investment income to average net assets*(b) (0.31)% (0.15)% (0.18)%
Portfolio turnover(c) 205.14% 205.14% 205.14%
</TABLE>

- ---------------

* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Prestige Balanced Fund commenced operations on November 2, 1998.

(b) Annualized.

(c) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

38
<PAGE> 88

SMALL CAP FUND

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
---------------------------------------------------------
INSTITUTIONAL SERVICE
CLASS A SHARES CLASS B SHARES CLASS SHARES
-------------- -------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $ 10.00 $10.00 $10.00
Net investment income (loss) 0.03 (0.05) 0.04
Net realized gain (loss) and unrealized appreciation
(depreciation) 1.19 1.22 1.19
------- ------ ------
Total from investment operations 1.22 1.17 1.23
------- ------ ------
Dividends from net investment income (0.03) -- (0.03)
Net increase in net asset value 1.19 1.17 1.20
------- ------ ------
NET ASSET VALUE -- END OF PERIOD $ 11.19 $11.17 $11.20
======= ====== ======
Total Return (excluding sales charges) 12.18% 11.70% 12.36%
Ratios and supplemental data:
Net Assets, end of period (000's) $19,830 $ 215 $1,759
Ratio of expenses to average net assets(b) 1.35% 2.10% 1.20%
Ratio of expenses to average net assets*(b) 2.24% 6.57% 4.87%
Ratio of net investment income to average net assets(b) 0.29% (0.46)% 0.39%
Ratio of net investment income to average net assets*(b) (0.61)% (4.93)% (3.27)%
Portfolio turnover(c) 81.24% 81.24% 81.24%
</TABLE>

- ---------------

* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Prestige Small Cap Fund commenced operations on November 2, 1998.

(b) Annualized.

(c) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

39
<PAGE> 89

Financial Highlights

INTERNATIONAL FUND

<TABLE>
<CAPTION>
PERIOD ENDED OCTOBER 31, 1999(A)
---------------------------------------------------------
INSTITUTIONAL SERVICE
CLASS A SHARES CLASS B SHARES CLASS SHARES
-------------- -------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD $ 10.00 $10.00 $10.00
Net investment income 0.11 0.07 0.14
Net realized gain (loss) and unrealized appreciation
(depreciation) 1.62 1.90 1.61
------- ------ ------
Total from investment operations 1.73 1.97 1.75
Dividends from net investment income (0.08) (0.01) (0.08)
------- ------ ------
Net increase in net asset value 1.65 1.96 1.67
------- ------ ------
NET ASSET VALUE -- END OF PERIOD $ 11.65 $11.96 $11.67
======= ====== ======
Total Return (excluding sales charges) 17.33% 16.58% 17.57%
Ratios and supplemental data:
Net Assets, end of period (000's) $13,862 $ 59 $ 669
Ratio of expenses to average net assets(b) 1.30% 2.05% 1.25%
Ratio of expenses to average net assets*(b) 2.87% 7.59% 6.30%
Ratio of net investment income to average net assets(b) 0.59% 0.62% 1.40%
Ratio of net investment income to average net assets*(b) (0.98)% (4.91)% (3.65)%
Portfolio turnover(c) 27.72% 27.72% 27.72%
</TABLE>

- ---------------

* Ratios calculated as if no fees were waived or expenses reimbursed.

(a) The Prestige International Fund commenced operations on November 2, 1998.

(b) Annualized.

(c) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares.

40
<PAGE> 90

INFORMATION FROM NATIONWIDE

Please read this Prospectus before you invest, and keep it with your records.
The following document contains additional information about the Funds. To
obtain a document free of charge, contact us at the address or number listed
below.

- - SAI (incorporated by reference into this Prospectus)

- - Annual Report (which contains a discussion of the market conditions and
investment strategies that significantly affect the Fund's performance)

- - Semi-Annual Report (as available)

FOR ADDITIONAL INFORMATION CONTACT:

Nationwide Advisory Services, Inc.
P.O. Box 1492
Columbus, OH 43216-1492
(614) 249-8705 (fax)

Nationwide Logo

FOR INFORMATION, ASSISTANCE AND WIRE ORDERS:

1-800-848-0920 (toll free, 8 a.m. - 5 p.m. Eastern Time (Monday through Friday,
except Thursday, in which case representatives are available between 9:30 a.m.
and 5 p.m. Eastern Time)).

FOR 24-HOUR ACCOUNT ACCESS:

1-800-637-0012 (toll free)

Also, visit the Nationwide Family of Funds' website at www.nationwidefunds.com

INFORMATION FROM THE SECURITIES AND EXCHANGE COMMISSION

You can obtain copies of Fund documents from the SEC as follows:

IN PERSON:

Public Reference Room in Washington, D.C. (For their hours of operation, call
1-202-942-8090.)

BY MAIL:

Securities and Exchange Commission
Public Reference Section

Washington, D.C. 20549-0102

(The SEC charges a fee to copy any documents.)

ON THE EDGAR DATABASE VIA THE INTERNET:

www.sec.gov

BY ELECTRONIC REQUEST:

[email protected]

INVESTMENT COMPANY ACT FILE NO. 811-08495

NATIONWIDE FAMILY OF FUNDS
THREE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215-2220

PRSRT STD

US POSTAGE

PAID

CLEVELAND OH

PERMIT NO 2112

DC-3225-A