Dreyfus Investment Portfolios
Core Bond Portfolio
Investing in fixed-income securities to maximize total return
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Core Bond Portfolio
Contents
The Portfolio
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Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
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Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
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INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMI-ANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks to maximize total return through capital appreciation and
current income. To pursue this goal, the portfolio invests at least 65% of its
assets in fixed-income securities, such as: U.S. government bonds and notes,
corporate bonds, convertible securities, preferred stocks, asset-backed
securities, mortgage-related securities, and foreign bonds. The portfolio also
may own warrants and common stock acquired in "units" with bonds.
Generally, the portfolio seeks to maintain an investment grade (BBB/Baa) average
credit quality. However, the portfolio may invest up to 35% of its assets in
lower-rated securities (" high yield" or "junk" bonds). The portfolio has the
flexibility to shift its investment focus among different fixed-income
securities, based on market conditions and other factors. In choosing market
sectors and securities for investment, the issuer's financial strength, and the
current state and long-term outlook of the industry or sector are reviewed.
Current and forecasted interest rate and liquidity conditions also are important
factors in this regard.
Typically, the portfolio can be expected to have an average effective maturity
of between 5 and 10 years and an average effective duration between 3.5 and 6
years. While the portfolio' s duration and maturity usually will stay within
these ranges, if the maturity or duration of the portfolio's benchmark index
moves outside these ranges, so may the portfolio's.
Concepts to understand
AVERAGE EFFECTIVE MATURITY: an average of the stated maturity of bonds, adjusted
to reflect provisions that may cause a bond's principal to be repaid earlier
than at maturity.
DURATION: an indication of an investment's "interest rate risk," or how
sensitive a bond or mutual fund portfolio may be to changes in interest rates.
Generally speaking, the longer a portfolio's duration, the more it is likely to
react to interest rate fluctuations and the greater its long-term risk/return
potential.
BOND RATING: a ranking of a bond's quality, based on its ability to pay interest
and repay principal. Bonds are rated from a high of "AAA" (highly unlikely to
default) through a low of "D" (companies already in default).
The Portfolio
<Page 1>
MAIN RISKS
The value of a shareholder's investment in the portfolio will go up and down,
which means that shareholders could lose money. The portfolio's principal risks
include:
. INTEREST RATE RISK. Prices of bonds tend to move inversely with changes
in interest rates. Typically, a rise in rates will adversely affect
bond prices and, accordingly, the portfolio' s share price. The
longer the portfolio's effective maturity and duration, the more its
share price is likely to react to changes in interest rates.
. CREDIT RISK. Failure of an issuer to make timely interest or principal
payments, or a decline or perception of a decline in the credit quality
of a bond, can cause a bond's price to fall, potentially lowering the
portfolio's share price. High yield bonds involve greater credit risk,
including the risk of default, than investment grade bonds and are
considered speculative. The prices of high yield bonds can fall
dramatically in response to bad news about the issuer or its industry,
or the economy in general.
. MARKET RISK. The portfolio' s overall risk level will depend on the
market sectors in which the portfolio is invested and the current
interest rate, liquidity and credit quality of such sectors.
. ILLIQUIDITY RISK. When there is no active trading market for specific
securities, it can become more difficult to sell the securities. In
such a market, the value of such securities and the portfolio's share
price may fall dramatically.
. PREPAYMENT AND EXTENSION RISK. When interest rates fall, the principal
on mortgages underlying mortgage-backed and certain asset-backed
securities may be prepaid. The loss of higher-yielding, underlying
mortgages and the reinvestment of proceeds at lower interest rates can
reduce the portfolio's potential price gain in response to falling
interest rates, reduce the portfolio' s yield, or cause the portfolio's
share price to fall. When interest rates rise, the portfolio' s
maturity may lengthen in response to a drop in mortgage prepayments.
This would increase the portfolio's sensitivity to rising rates and its
potential for price declines.
. FOREIGN RISK. The prices and yields of foreign bonds can be affected by
political and economic instability or changes in currency exchange
rates. The bonds of issuers located in emerging markets can be more
volatile and less liquid than those of issuers in more mature
economies.
Other potential risks
The portfolio may invest in derivatives, such as options and futures contracts,
and certain mortgage-related and asset-backed securities. Derivatives can be
illiquid and their value can fall dramatically in response to rapid or
unexpected changes in their underlying instruments. A small investment in
certain derivatives can have a large impact on the portfolio's performance.
At times, the portfolio may engage in short-term trading, which could produce
higher transaction costs.
The portfolio may buy securities on a forward commitment basis and may enter
into reverse repurchase agreements. Those investment strategies may have a
leveraging effect on the portfolio, thus potentially increasing its overall
volatility.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares were not in existence as of December 31, 1999, annual total
return information for that class is not included in this section of the
prospectus. As a new class, past performance information is not available for
Service shares as of the date of this prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
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ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.60% 0.60%
Rule 12b-1 fee none 0.25%
Other expenses 0.68% 0.68%
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TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 1.28% 1.53%
Fee waiver and/or expense
reimbursement (0.48%) (0.73%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 0.80% 0.80%
* THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 0.80%.
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $82 $358
SERVICE SHARES $82 $412
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual return and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The three-year number is based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus an annual management fee of 0.60% of the portfolio's average daily net
assets. Dreyfus is the primary mutual fund business of Mellon Financial
Corporation, a global financial services company with approximately $2.8
trillion of assets under management, administration or custody, including
approximately $540 billion under management. Mellon provides wealth management,
global investment services and a comprehensive array of banking services for
individuals, businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
The Dreyfus taxable fixed income team, which consists of sector specialists,
collectively makes investment decisions for the portfolio. The team' s
specialists focus on, and monitor conditions in, the different sectors of the
fixed income market. Once different factors have been analyzed, the sector
specialists then decide on allocation weights for the portfolio and recommend
securities for investment.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance Information for a Related Public Fund
Although the portfolio is newly organized and does not yet have its own full
year of performance, the portfolio has the same investment objective and follows
substantially the same investment policies and strategies as a corresponding
series of another open-end investment company advised by Dreyfus -- Dreyfus
Premier Core Bond Fund -- Class A shares (the "Public Fund"). The portfolio
currently has the same investment team as the Public Fund. The table at right
shows average annual total return information for the Public Fund and for the
Merrill Lynch Domestic Master Index, the benchmark index of the portfolio and
the Public Fund. NO PERFORMANCE INFORMATION IS SHOWN FOR THE PORTFOLIO, WHICH
DID NOT HAVE ITS OWN FULL YEAR OF PERFORMANCE AS OF SEPTEMBER 30, 2000.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses for the fiscal year ended October 31, 2000 were 1.01% of its
average daily net assets. The performance figures also do not reflect the
deduction of charges or expenses attributable to VA contracts or VLI policies,
which would lower the performance quoted. Policy owners should refer to the
applicable insurance company prospectus for information on any such charges and
expenses. Additionally, although it is anticipated that the portfolio and the
Public Fund will hold similar securities, their investment results are expected
to differ. In particular, differences in asset size and in cash flow resulting
from purchases and redemptions of portfolio shares may result in different
security selections, differences in the relative weightings of securities or
differences in the price paid for particular portfolio holdings.
<TABLE>
<CAPTION>
Historical performance information for Class A shares of the Public Fund and the
Merrill Lynch Domestic Master Index for various periods ended September 30,
2000, as calculated pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------------
DREYFUS PREMIER
CORE BOND FUND
<S> <C> <C> <C>
CLASS A (NAV) 7.83% 7.50% 9.41%
CLASS A
(WITH SALES LOAD) 1.63% 6.23% 8.76%
MERRILL LYNCH
DOMESTIC
MASTER INDEX* 6.92% 6.47% 8.10%(
* THE MERRILL LYNCH DOMESTIC MASTER INDEX IS AN UNMANAGED PERFORMANCE
BENCHMARK FOR U.S. GOVERNMENT SECURITIES AND INVESTMENT GRADE CORPORATE
SECURITIES WITH MATURITIES GREATER THAN OR EQUAL TO ONE YEAR. ALL PERFORMANCE
FIGURES REFLECT THE REINVESTMENT OF DIVIDENDS AND OTHER DISTRIBUTIONS.
</TABLE>
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal period indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during the period, assuming the
investor had reinvested all dividends and distributions. These figures are
unaudited. Keep in mind that fees and charges imposed by participating insurance
companies, which are not reflected in the table, would reduce the investment
returns that are shown. Since Service shares are new, financial highlights
information is not available for that class as of the date of this prospectus.
(UNAUDITED)
PERIOD ENDED JUNE 30,
INITIAL SHARES 2000(1)
----------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C>
Net asset value, beginning of period 12.50
Investment operations: Investment income -- net .12
Net realized and unrealized gain (loss) on investments .09
Total from investment operations .21
Distributions: Dividends from investment income -- net (.06)
Net asset value, end of period 12.65
Total return (%) 10.05(2)
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RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .80(2)
Ratio of net investment income to average net assets (%) 5.86(2)
Decrease reflected in above expense ratios due to actions by Dreyfus (%)
1.13(2)
Portfolio turnover rate (%) 162.16(3)
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Net assets, end of period ($ x 1,000) 5,291
(1) FROM MAY 1, 2000 (COMMENCEMENT OF OPERATIONS) TO JUNE 30, 2000.
(2) ANNUALIZED.
(3) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
PORTFOLIO SHARES MAY BE PURCHASED or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
THE PRICE FOR PORTFOLIO SHARES is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided the orders are received by the portfolio in
proper form on the next business day. The participating insurance company is
responsible for properly transmitting purchase and sale orders.
WIRE PURCHASE PAYMENTS MAY BE MADE if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: CORE BOND PORTFOLIO/ SHARE CLASS)
, for purchase of portfolio shares. The wire must include the portfolio account
number (for new accounts, a taxpayer identification number should be included
instead) and account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio' s investments are generally valued by using available market
quotations or at fair value, which may be determined by one or more pricing
services approved by the fund's board.
DISTRIBUTIONS AND TAXES
THE PORTFOLIO USUALLY PAYS DIVIDENDS from its net investment income once a
month, and distributes any net capital gains it has realized once a year.
EACH SHARE CLASS WILL GENERATE a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
SHAREHOLDERS CAN EXCHANGE SHARES of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Core Bond Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions,
economic trends and portfolio strategies that significantly affected the
portfolio's performance during the last fiscal period.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
165P1200
Dreyfus Investment Portfolios
Core Value Portfolio
Investing in large-cap stocks for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Core Value Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 6
Account Information
--------------------------------------------------------------------------------
Account Policies 7
Distributions and Taxes 7
Exchange Privilege 8
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term growth of capital, with current income as a
secondary objective. To pursue these goals, the portfolio invests primarily in
stocks of large-cap value companies (market capitalizations of $1 billion and
above) . The portfolio typically invests mainly in the stocks of U.S. issuers,
and will limit its foreign stock holdings to 20% of the value of its total
assets. The portfolio's stock investments may include common stocks, preferred
stocks, convertible securities and depositary receipts.
In choosing stocks, the portfolio manager focuses on individual stock selection
(a "bottom-up" approach) rather than forecasting stock market trends (a
" top-down" approach) , and looks for value companies. A three-step value
screening process is used to select stocks:
. VALUE: quantitative screens track traditional measures such as
price-to-earnings, price-to-book and price-to-sales; these ratios are
analyzed and compared against the market
. SOUND BUSINESS FUNDAMENTALS: a company' s balance sheet and income data
are examined to determine the company's financial history
. POSITIVE BUSINESS MOMENTUM: a company' s earnings and forecast changes
are analyzed and sales and earnings trends are reviewed to determine
the company's financial condition
The portfolio typically sells a stock when it is no longer considered a value
company, appears less likely to benefit from the current market and economic
environment, shows deteriorating fundamentals or falls short of the portfolio
manager's expectations.
Concepts to understand
VALUE COMPANIES: companies that appear underpriced according to certain
financial measurements of their intrinsic worth or business prospects (such as
price-to-earnings or price-to-book ratios). Because a stock can remain
undervalued for years, value investors often look for factors that could trigger
a rise in price.
LARGE-CAP COMPANIES: established companies that are considered "known
quantities." Large-cap companies often have the resources to weather economic
shifts, though they can be slower to innovate than small companies.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
Value stocks involve the risk that they may never reach what the portfolio
manager believes is their full market value, either because the market fails to
recognize the stock' s intrinsic worth or the portfolio manager misgauged that
worth. They also may decline in price, even though in theory they are already
underpriced. Because different types of stocks tend to shift in and out of favor
depending on market and economic conditions, the portfolio's performance may
sometimes be lower or higher than that of other types of funds (such as those
emphasizing growth stocks).
Any foreign securities purchased by the portfolio include special risks, such as
exposure to currency fluctuations, changing political climate, lack of
comprehensive company information and potentially less liquidity.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its primary investment objective.
Other potential risks
The portfolio, at times, may invest some assets in derivatives, such as options
and futures contracts. The portfolio also may invest in foreign currencies.
These practices, when employed, are used primarily to hedge the portfolio but
may be used to increase returns; however, such practices sometimes may reduce
returns or increase volatility. Derivatives can be illiquid, and a small
investment in certain derivatives could have a potentially large impact on the
portfolio's performance.
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the
portfolio. The bar chart shows the performance of the portfolio's Initial shares
for the portfolio's first full calendar year of operations. The table compares
the average annual total return of the Initial shares to that of the Standard &
Poor' s 500/BARRA Value Index (S&P 500 BARRA Value), which has been selected as
the portfolio' s primary index based on the portfolio's and the index's value
orientation, and the Standard & Poor's 500((reg.tm)) Composite Stock Price Index
(S& P 500 Composite), each a broad measure of stock performance. Performance for
the S& P 500 Composite will not be shown in the future. All performance figures
reflect the reinvestment of dividends and distributions. Of course, past
performance is no guarantee of future results. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year-by-year total return AS OF 12/31 EACH YEAR (%)
19.73
90 91 92 93 94 95 96 97 98 99
INITIAL SHARES
BEST QUARTER: Q4 '99 +13.16%
WORST QUARTER: Q3 '99 -10.40%
--------------------------------------------------------------------------------
Average annual total return AS OF 12/31/99
Since
inception
1 Year (5/1/98)
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INITIAL SHARES 19.73% 7.61%
S&P 500 BARRA VALUE 12.72% 8.46%*
S&P 500 COMPOSITE 21.03% 19.80%*
* FOR COMPARATIVE PURPOSES, THE VALUE OF EACH INDEX ON 4/30/98 IS USED AS THE
BEGINNING VALUE ON 5/1/98.
</TABLE>
Additional costs
Performance information reflects the portfolio's expenses only and does not
reflect the fees and charges imposed by participating insurance companies under
their VA contracts or VLI policies. Because these fees and charges will reduce
total return, VA contract holders and VLI policyholders should consider them
when evaluating and comparing the portfolio's performance. VA contract holders
and VLI policyholders should consult the prospectus for their contract or policy
for more information.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price. As
with the performance information given previously, these figures do not reflect
any fees or charges imposed by participating insurance companies under their VA
contracts or VLI policies.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.75% 0.75%
Rule 12b-1 fee none 0.25%
Other expenses 0.75% 0.75%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 1.50% 1.75%
Fee waiver and/or expense
reimbursement (0.50%) (0.75%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.00% 1.00%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.00%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $102 $425 $771 $1,748
SERVICE SHARES $102 $478 $879 $2,000
</TABLE>
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The longer-term numbers are based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. For the past fiscal year, the
portfolio paid Dreyfus a management fee at the annual rate of 0.25% of the
portfolio' s average daily net assets. Dreyfus is the primary mutual fund
business of Mellon Financial Corporation, a global financial services company
with approximately $2.8 trillion of assets under management, administration or
custody, including approximately $540 billion under management. Mellon provides
wealth management, global investment services and a comprehensive array of
banking services for individuals, businesses and institutions. Mellon is
headquartered in Pittsburgh, Pennsylvania.
The portfolio' s primary portfolio manager is Valerie J. Sill. She has been a
portfolio manager of the portfolio since its inception. Ms. Sill is a portfolio
manager of Dreyfus and senior vice president of The Boston Company Asset
Management, Inc. (TBCAM), an affiliate of Dreyfus. She is also a member of the
Equity Policy Group of TBCAM. She previously served as director of equity
research and as an equity research analyst for TBCAM.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 5>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
INITIAL SHARES 2000 1999 1998(1)
-------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C> <C>
Net asset value, beginning of period 13.97 11.72 12.50
Investment operations: Investment income -- net .06(2) .07(2) .07
Net realized and unrealized gain (loss) on investments (.11) 2.24 (.77)
Total from investment operations (.05) 2.31 (.70)
Distributions: Dividends from investment income -- net -- (.06) (.08)
Dividends from net realized gain on investments (.06) -- --
Total distributions (.06) (.06) (.08)
Net asset value, end of period 13.86 13.97 11.72
Total return (%) (.39)(3) 19.73 (5.59)(3)
---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .50(3) 1.00 .67(3)
Ratio of net investment income to average net assets (%) .40(3) .56 .62(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) .08(3) .50 .74(3)
Portfolio turnover rate (%) 50.17(3) 97.14 47.37(3)
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 18,519 15,343 5,959
(1) FROM MAY 1, 1998 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1998.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
<Page 6>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
PORTFOLIO SHARES MAY BE PURCHASED or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
THE PRICE FOR PORTFOLIO SHARES is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders.
WIRE PURCHASE PAYMENTS MAY BE MADE if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: CORE VALUE PORTFOLIO/SHARE CLASS)
, for purchase of portfolio shares. The wire must include the portfolio account
number (for new accounts, a taxpayer identification number should be included
instead) , account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
THE PORTFOLIO USUALLY PAYS DIVIDENDS from its net investment income and
distributes any net capital gains it has realized once a year.
EACH SHARE CLASS WILL GENERATE a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
Account Information
<Page 7>
EXCHANGE PRIVILEGE
SHAREHOLDERS CAN EXCHANGE SHARES of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
<Page 8>
NOTES
For More Information
Dreyfus Investment Portfolios
Core Value Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
172P1200
Dreyfus Investment Portfolios
Emerging Leaders Portfolio
Seeks capital growth by investing in small companies
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Emerging Leaders Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks capital growth. To pursue this goal, the portfolio invests
in companies Dreyfus believes to be emerging leaders: small companies
characterized by new or innovative products, services or processes having the
potential to enhance earnings growth. The portfolio invests at least 65% of its
total assets in companies with total market values of less than $1.5 billion at
the time of purchase. The portfolio's investments may include common stocks,
preferred stocks and convertible securities, including those issued in initial
public offerings.
In choosing stocks, the portfolio uses a blended approach, investing in a
combination of growth and value stocks. Using fundamental research and direct
management contact, the portfolio managers seek stocks with dominant positions
in major product lines, sustained achievement records and strong financial
condition. They also seek special situations, such as corporate restructurings
or management changes, that could increase the stock price.
The portfolio managers use a sector management approach, supervising a team of
sector managers who assist in making buy and sell decisions within their
respective areas of expertise. The portfolio' s sector weightings typically
approximate those of the Russell 2000 Index.
The portfolio typically sells a stock when the reasons for buying it no longer
apply, when the company begins to show deteriorating fundamentals or poor
relative performance, or when a stock is fully valued by the market.
The portfolio currently intends to close to new investors after it reaches total
assets of approximately $750 million.
Concepts to understand
SMALL COMPANIES: new, often entrepreneurial companies. Small companies tend to
grow faster than large-cap companies, but frequently are more volatile, are more
vulnerable to major setbacks, and have a higher failure rate than larger
companies.
GROWTH COMPANIES: companies of any capitalization whose earnings are expected to
grow faster than the overall market. Often, growth stocks have relatively high
price-to-earnings, price-to-book and price-to-sales ratios, and tend to be more
volatile than value stocks.
VALUE COMPANIES: companies that appear underpriced according to certain
financial measurements of their intrinsic worth or business prospects (such as
price-to-earnings or price-to-book ratios). Because a stock can remain
undervalued for years, value investors often look for factors that could trigger
a rise in price.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, sometimes dramatically, which means that
shareholders could lose money.
Small companies carry additional risks because their operating histories tend to
be more limited, their earnings less predictable, their share prices more
volatile and their securities less liquid than larger, more established
companies. Some of the portfolio' s investments will rise and fall based on
investor perceptions rather than economics. In addition, some of the portfolio's
investments will be made in anticipation of future products and services that,
if delayed, could cause the stock price to drop.
The portfolio may purchase securities of companies in initial public offerings
(IPOs) . The prices of securities purchased in IPOs can be very volatile. The
effect of IPOs on the portfolio's performance depends on a variety of factors,
including the number of IPOs the portfolio invests in, whether and to what
extent a security purchased in an IPO appreciates in value, and the asset base
of the portfolio. As a portfolio' s asset base increases, IPOs often have a
diminished effect on such portfolio's performance.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
Value stocks are subject to the risk that their intrinsic values may never be
realized by the market, or their prices may go down. Further, while the
portfolio' s investments in value stocks may limit the overall downside risk of
the portfolio over time, the portfolio may produce more modest gains than
riskier small-company stock funds as a trade-off for this potentially lower
risk.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
The portfolio, at times, may invest in derivatives, such as options and futures
contracts. The portfolio also may invest in foreign currencies and engage in
short-selling, which involves selling a security it does not own in anticipation
of a decline in the market price of the security. These practices, when
employed, are used primarily to hedge the portfolio but may be used to increase
returns; however, such practices sometimes may reduce returns or increase
volatility. In addition, derivatives can be illiquid and highly sensitive to
changes in their underlying instrument. A small investment in certain
derivatives could have a potentially large impact on the portfolio's
performance.
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.90% 0.90%
Rule 12b-1 fee none 0.25%
Other expenses 0.94% 0.94%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 1.84% 2.09%
Fee waiver and/or expense
reimbursement (0.34%) (0.59%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.50% 1.50%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRA-ORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.50%.
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $153 $546
SERVICE SHARES $153 $598
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual return and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The three-year number is based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 0.90% of the portfolio's average
daily net assets. For the fiscal period December 15, 1999 (commencement of
operations) through December 31, 1999, the portfolio did not pay Dreyfus a
management fee as a result of a fee waiver/expense reimbursement in effect.
Dreyfus is the primary mutual fund business of Mellon Financial Corporation, a
global financial services company with approximately $2.8 trillion of assets
under management, administration or custody, including approximately $540
billion under management. Mellon provides wealth management, global investment
services and a comprehensive array of banking services for individuals,
businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
The portfolio's primary portfolio managers are Paul Kandel and Hilary Woods. Mr.
Kandel and Ms. Woods have been the portfolio's primary portfolio managers since
its inception. Mr. Kandel joined Dreyfus in 1994 as senior sector manager for
the technology and telecommunications industries. Ms. Woods joined Dreyfus in
1987 as senior sector manager for the capital goods industry.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance Information for Related Funds
The portfolio has substantially the same investment objective and follows
substantially the same investment policies and strategies as two corresponding
series of separate open-end investment companies advised by Dreyfus, the Dreyfus
Emerging Leaders Fund (the "Public Fund"), which is offered to the public, and
Dreyfus Small Cap Portfolio (the "Insurance Fund"), which, like the portfolio,
serves as a funding vehicle for variable insurance products. The portfolio
currently has the same primary portfolio managers as the Public Fund and the
Insurance Fund. The table at the right shows average annual total return
information for the Public Fund, the Insurance Fund and the Russell 2000 Index,
the benchmark index of the portfolio, the Public Fund and the Insurance Fund. No
performance information is shown for the portfolio, which did not have its own
full year of performance as of September 30, 2000.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
and the Insurance Fund reflect the deduction of the historical fees and expenses
paid by such funds, and not those paid by the portfolio. The total annual
operating expenses, after fee waiver and expense reimbursement, if any, for the
fiscal year ended August 31, 2000 for the Public Fund were 1.26% and for the
fiscal year ended December 31, 1999 for the Insurance Fund were 0.78% of the
respective fund's average daily net assets. The performance figures also do not
reflect the deduction of charges or expenses attributable to VA contracts or VLI
policies, which would lower the performance quoted. Policy owners should refer
to the applicable insurance company prospectus for information on any such
charges and expenses. Additionally, although it is anticipated that the
portfolio, the Public Fund and the Insurance Fund will hold similar securities,
their investment results are expected to differ. In particular, differences in
asset size and in cash flow resulting from purchases and redemptions of
portfolio shares may result in different security selections, differences in the
relative weightings of securities or differences in the price paid for
particular portfolio holdings.
<TABLE>
<CAPTION>
Historical performance information for the Public Fund, the Insurance Fund and
the Russell 2000 Index for various periods ended September 30, 2000, as
calculated pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
1 Year 5 Years 10 Years inception*
--------------------------------------------------------------------------------------------------------------------------------
DREYFUS
EMERGING
LEADERS
<S> <C> <C> <C> <C>
FUND 30.42% 29.64% -- 29.57%
DREYFUS
SMALL CAP
PORTFOLIO 41.49% 13.93% 35.04% --
RUSSELL 2000
INDEX** 23.39% 12.38% 16.93% 12.38%***
* THE INCEPTION DATE OF THE DREYFUS EMERGING LEADERS FUND WAS 9/29/95.(
** THE RUSSELL 2000 INDEX IS A WIDELY RECOGNIZED, UNMANAGED SMALL-CAP INDEX
COMPRISED OF THE COMMON STOCKS OF THE 2,000 U.S. PUBLIC COMPANIES NEXT
IN SIZE AFTER THE LARGEST 1,000 PUBLICLY TRADED U.S. COMPANIES. ALL
PERFORMANCE FIGURES REFLECT THE REINVESTMENT OF DIVIDENDS AND OTHER
DISTRIBUTIONS.
*** FOR COMPARATIVE PURPOSES FOR THE DREYFUS EMERGING LEADERS FUND, THE VALUE
OF THE INDEX ON 9/30/95 IS USED AS THE BEGINNING VALUE ON 9/29/95.
</TABLE>
<Page 6>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
----------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 13.44 12.50
Investment operations: Investment income (loss) -- net (.04)(2) .01
Net realized and unrealized gain (loss) on investments 2.19 .93
Total from investment operations 2.15 .94
Distributions: Dividends from investment income -- net (.01) --
Net asset value, end of period 15.58 13.44
Total return (%) 15.97(3) 7.52(3)
---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .75(3) .07(3)
Ratio of net investment income (loss) to average net assets (%) (.28)(3) .04(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) .63(3) 1.25(3)
Portfolio turnover rate (%) 87.56(3) 1.79(3)
--------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 2,825 2,150
(1) FROM DECEMBER 15, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided the orders are received by the portfolio in
proper form on the next business day. The participating insurance company is
responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Emerging Leaders Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead) and account registration and dealer number, if applicable, of
the participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Emerging Leaders Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio managers discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
192P1200
Dreyfus Investment Portfolios
Emerging Markets Portfolio
Investing in emerging markets for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Emerging Markets Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term capital growth. To pursue this goal, the portfolio
invests primarily in the stocks of companies organized, or with a majority of
its assets or business, in emerging market countries. Normally, the portfolio
will not invest more than 25% of its total assets in the securities of companies
in any one emerging market country. The portfolio may invest up to 35% of its
net assets in the high yield debt securities of such companies as Dreyfus deems
appropriate in light of market conditions.
In choosing stocks, the portfolio emphasizes growth-oriented stocks and employs
a top-down country allocation approach which involves identifying and
forecasting: key trends in global economic variables, such as gross domestic
product, inflation and interest rates; investment themes, such as the impact of
new technologies and the globalization of industries and brands; relative values
of equity securities, bonds and cash; and long-term trends in currency
movements.
Within countries and sectors determined to be relatively attractive, the
portfolio seeks what the portfolio manager believes to be attractively priced
companies that possess a sustainable competitive advantage in their country or
sector. The portfolio typically will sell a security when themes or strategies
change, or when the portfolio manager determines that the company's prospects
have changed or that its stock is fully valued by the market.
Concepts to understand
EMERGING MARKET COUNTRIES: consist of all countries represented by the Morgan
Stanley Capital International (MSCI) Emerging Markets (Free) Index, which
currently includes Argentina, Brazil, Chile, China, Colombia, the Czech
Republic, Egypt, Greece, Hungary, India, Indonesia, Israel, Jordan, Korea,
Mexico, Morocco, Pakistan, Peru, Philippines, Poland, Russia, Sri Lanka, South
Africa, Taiwan, Thailand, Turkey and Venezuela, or any other country Dreyfus
believes has an emerging economy or market.
GROWTH COMPANIES: companies of any capitalization whose earnings are expected to
grow faster than the overall market. Often, growth stocks have relatively high
price-to-earnings, price-to-book and price-to-sales ratios, and tend to be more
volatile than value stocks.
The Portfolio
<Page 1>
MAIN RISKS
The stock markets of emerging market countries can be extremely volatile. The
value of a shareholder' s investment in the portfolio will go up and down,
sometimes dramatically, which means that shareholders could lose money rapidly.
The portfolio's performance will be influenced by political, social and economic
factors affecting investments in companies in emerging market countries. These
countries generally have economic structures that are less diverse and mature,
and political systems that are less stable, than those of developed countries.
Emerging markets may be more volatile than the markets of more mature economies,
and the securities of companies located in emerging markets are often subject to
rapid and large changes in price. Special risks include exposure to currency
fluctuations, less liquidity, less developed or efficient trading markets, a
lack of comprehensive company information, political instability, and differing
auditing and legal standards. Such risks could result in more volatility for the
portfolio.
Because the stock prices of growth companies are based in part on future
expectations, these stocks may fall sharply if investors believe the prospects
for a stock, industry or the economy in general are weak. In addition, growth
stocks typically lack the dividend yield that could cushion stock prices in
market downturns.
The fund may invest in companies of any size. Investments in smaller companies
carry additional risks because their earnings tend to be less predictable, their
share prices more volatile and their securities less liquid than larger, more
established companies.
High yield (" junk" ) bonds involve greater credit risk, including the risk of
default, than investment grade bonds. They tend to be more volatile in price and
less liquid and are considered speculative.
The portfolio is non-diversified and may invest a greater percentage of its
assets in a particular company compared with other funds. Accordingly, the
portfolio may be more sensitive to changes in the market value of a single
company or industry.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to
avoid losses, it could reduce the benefit from any upswing in the market. During
such periods, the portfolio may not achieve its investment objective.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
Other potential risks
The portfolio, at times, may invest in derivatives, such as options and futures
contracts. The portfolio also may invest in foreign currencies and engage in
short-selling, which involves selling a security it does not own in anticipation
of a decline in the market price of the security. These practices, when
employed, are used primarily to hedge its portfolio but also to increase
returns; however, such practices sometimes may reduce returns or increase
volatility. In addition, derivatives can be illiquid and highly sensitive to
changes in their underlying instrument. A small investment in certain
derivatives could have a potentially large impact on the portfolio's
performance.
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 1.25% 1.25%
Rule 12b-1 fee none 0.25%
Other expenses 1.51% 1.51%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 2.76% 3.01%
Fee waiver and/or expense
reimbursement (0.76%) (1.01%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 2.00% 2.00%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 2.00%.
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $203 $784
SERVICE SHARES $203 $835
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual return and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The three-year number is based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 1.25% of the portfolio's average
daily net assets. For the fiscal period December 15, 1999 (commencement of
operations) through December 31, 1999, the portfolio did not pay Dreyfus a
management fee as a result of a fee waiver/expense reimbursement in effect.
Dreyfus is the primary mutual fund business of Mellon Financial Corporation, a
global financial services company with approximately $2.8 trillion of assets
under management, administration or custody, including approximately $540
billion under management. Mellon provides wealth management, global investment
services and a comprehensive array of banking services for individuals,
businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
The portfolio's primary portfolio manager is Daniel Beneat. Mr. Beneat has been
the primary portfolio manager of the portfolio since its inception and has been
employed by Dreyfus since May 1996. For the three previous years, he was a vice
president and portfolio manager at UBS Asset Management (NY), Inc.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance Information for Related Public Fund
The portfolio has the same investment objective and follows substantially the
same investment policies and strategies as a corresponding series of another
open-end investment company advised by Dreyfus, the Dreyfus Premier Emerging
Markets Fund -- Class A shares (the "Public Fund"). The portfolio has the same
primary portfolio manager as the Public Fund. The table at right shows average
annual total return information for the Public Fund and for the Morgan Stanley
Capital International (MSCI) Emerging Markets (Free) Index, the benchmark index
of the portfolio and the Public Fund. No performance information is shown for
the portfolio, which did not have its own full year of performance as of
September 30, 2000.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses, after fee waiver and expense reimbursement, for the year
ended September 30, 2000 were 2.25% of its average daily net assets. The
performance figures for the Public Fund also do not reflect the deduction of
charges or expenses attributable to VA contracts or VLI policies, which would
lower the performance quoted. Policy owners should refer to the applicable
insurance company prospectus for information on any such charges and expenses.
Additionally, although it is anticipated that the portfolio and the Public Fund
will hold similar securities, their investment results are expected to differ.
In particular, differences in asset size and in cash flow resulting from
purchases and redemptions of portfolio shares may result in different security
selections, differences in the relative weightings of securities or differences
in the price paid for particular portfolio holdings.
Historical performance information for Class A shares of the Public Fund and for
the MSCI Emerging Markets (Free) Index for various periods ended September 30,
2000, as calculated pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since inception
1 Year (3/31/98)
--------------------------------------------------------------------------------
DREYFUS PREMIER EMERGING MARKETS FUND
CLASS A (NAV) 7.91% .92%
CLASS A (WITH SALES LOAD) 1.68% -1.42%
MSCI EMERGING MARKETS
(FREE) INDEX* .41% -2.59%
*THE MSCI EMERGING MARKETS (FREE) INDEX IS A MARKET CAPITALIZATION-WEIGHTED
INDEX COMPOSED OF COMPANIES REPRESENTATIVE OF THE MARKET STRUCTURE OF 25
EMERGING MARKET COUNTRIES IN EUROPE, LATIN AMERICA AND THE PACIFIC BASIN AND
INCLUDES GROSS DIVIDENDS REINVESTED. THE INDEX EXCLUDES CLOSED MARKETS AND THOSE
SHARES IN OTHERWISE FREE MARKETS WHICH ARE NOT PURCHASABLE BY FOREIGNERS.
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
--------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 13.63 12.50
Investment operations: Investment income -- net .10(2) .02
Net realized and unrealized gain (loss) on investments (1.12) 1.11
Total from investment operations (1.02) 1.13
Distributions: Dividends from investment income -- net (.02) --
Dividends from net realized gain on investments (.01) --
Total distributions (.03) --
Net asset value, end of period 12.58 13.63
Total return (%) (7.54)(3) 9.04(3)
--------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .99(3) .09(3)
Ratio of net investment income to average net assets (%) .75(3) .18(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%)
1.01(3) 1.51(3)
Portfolio turnover rate (%) 66.30(3) .43(3)
--------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 2,087 2,181
(1) FROM DECEMBER 15, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
The Portfolio
</TABLE>
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided the orders are received by the portfolio in
proper form on the next business day. The participating insurance company is
responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Emerging Markets Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead) and account registration and dealer number, if applicable, of
the participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees. Foreign securities held by the portfolio
may trade on days when the portfolio does not calculate its NAV and thus affect
the portfolio's NAV on days when investors have no access to the portfolio.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Emerging Markets Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from:
http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
191P1200
Dreyfus Investment Portfolios
European Equity Portfolio
Investing in European companies for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
European Equity Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 6
Account Information
--------------------------------------------------------------------------------
Account Policies 7
Distributions and Taxes 7
Exchange Privilege 8
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term capital growth. To pursue this goal, the portfolio
generally invests at least 80% of its total assets in stocks included within the
universe of the 300 largest European companies. The portfolio may invest up to
10% of its total assets in the stocks of non-European companies. The portfolio's
stock investments may include common stocks, preferred stocks and convertible
securities.
In choosing stocks, the portfolio manager identifies and forecasts: key trends
in economic variables, such as gross domestic product, inflation and interest
rates; investment themes, such as the impact of new technologies and the
globalization of industries and brands; relative values of equity securities,
bonds and cash; and long-term trends in currency movements.
Within markets and sectors determined to be relatively attractive, the portfolio
manager seeks what are believed to be attractively priced companies that possess
a sustainable competitive advantage in their market or sector. The portfolio
manager generally sells securities when themes or strategies change or when the
portfolio manager determines that the company's prospects have changed or that
its stock is fully valued by the market.
Concepts to understand
EUROPEAN COMPANY: a company organized under the laws of a European country or
for which the principal securities trading market is in Europe; or a company,
wherever organized, with a majority of its assets or business in Europe.
PREFERRED STOCK: stock that pays dividends at a specified rate and has
preference over common stock in the payment of dividends and the liquidation of
assets. Preferred stock ordinarily does not carry voting rights.
CONVERTIBLE SECURITIES: corporate securities, usually preferred stock or bonds,
that are exchangeable for a set amount of another form of security, usually
common stock, at a prestated price.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a choice of long-term investors, they do
fluctuate in price. The value of a shareholder's investment in the portfolio
will go up and down, which means that shareholders could lose money.
The portfolio's performance will be influenced by political, social and economic
factors affecting companies in European countries and throughout the world.
These risks include changes in currency exchange rates, a lack of comprehensive
company information, political instability, less liquidity and differing
auditing and legal standards.
The portfolio expects to invest primarily in the stocks of companies located in
developed European countries. However, the portfolio may invest in the stocks of
companies located in certain European countries which are considered to be
emerging markets. These countries generally have economic structures that are
less diverse and mature, and political systems that are less stable, than those
of developed countries. Emerging markets may be more volatile than the markets
of more mature economies, and the securities of companies located in emerging
markets are often subject to rapid and large changes in price; however, these
markets may provide higher rates of return to investors.
The portfolio may purchase securities of companies in initial public offerings
(IPOs) . The prices of securities purchased in IPOs can be very volatile. The
effect of IPOs on the portfolio's performance depends on a variety of factors,
including the number of IPOs the portfolio invests in, whether and to what
extent a security purchased in an IPO appreciates in value, and the asset base
of the portfolio. As a portfolio' s asset base increases, IPOs often have a
diminished effect on such portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
The portfolio, at times, may invest in derivatives, such as options and futures
contracts. The portfolio also may invest in foreign currencies and engage in
short-selling, which involves selling a security it does not own in anticipation
of a decline in the market price of the security. These practices, when
employed, are used primarily to hedge its portfolio but also may be used to
increase returns; however, such practices sometimes may reduce returns or
increase volatility. In addition, derivatives can be illiquid and highly
sensitive to changes in their underlying instrument. A small investment in
certain derivatives could have a potentially large impact on the portfolio's
performance.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 1.00% 1.00%
Rule 12b-1 fee none 0.25%
Other expenses 4.03% 4.03%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 5.03% 5.28%
Fee waiver and/or expense
reimbursement (3.78%) (4.03%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.25% 1.25%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.25%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $127 $1,171 $2,214 $4,818
SERVICE SHARES $127 $1,220 $2,306 $4,996
This example shows what an investor could pay in expenses over time. It uses
the same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be
different, the example is for comparison only. The one-year number is based on
net operating expenses. The longer-term numbers are based on total annual
portfolio operating expenses.
</TABLE>
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 1.00% of the portfolio's average
daily net assets. For the fiscal period April 30, 1999 (commencement of
operations) through December 31, 1999, the portfolio did not pay Dreyfus a
management fee as a result of a fee waiver/expense reimbursement in effect.
Dreyfus is the primary mutual fund business of Mellon Financial Corporation, a
global financial services company with approximately $2.8 trillion of assets
under management, administration or custody, including approximately $540
billion under management. Mellon provides wealth management, global investment
services and a comprehensive array of banking services for individuals,
businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
Dreyfus has engaged its affiliate, Newton Capital Management Limited, to serve
as the portfolio's sub-investment adviser. Newton, located at 71 Queen Victoria
Street, London, EC4V 4DR, England, was formed in 1977 and, as of September 30,
2000, together with its parent and its parent' s subsidiaries, managed
approximately $30 billion in discretionary separate accounts and other
investment accounts.
The portfolio's primary portfolio manager is Joanna Bowen. Ms. Bowen has been a
primary portfolio manager for the portfolio since its inception. She joined
Newton in 1993 as a European fund manager, was appointed an associate director
of Newton in 1997, and was appointed a director of Newton in 1999.
The portfolio, Dreyfus, Newton and Dreyfus Service Corporation (the portfolio's
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 5>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
---------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 15.96 12.50
Investment operations: Investment income -- net .11(2) .04(2)
Net realized and unrealized gain (loss) on investments .33 3.61
Total from investment operations .44 3.65
Distributions: Dividends from investment income -- net -- (.03)
Dividends from net realized gain on investments (.51) (.16)
Total distributions (.51) (.19)
Net asset value, end of period 15.89 15.96
Total return (%) 2.45(3) 29.20(3)
--------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .65(3) 1.01(3)
Ratio of net investment income to average net assets (%) .63(3) .32(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) .28(3) 2.38(3)
Portfolio turnover rate (%) 99.81(3) 99.89(3)
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 19,900 6,592
(1) FROM APRIL 30, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
<Page 6>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: European Equity Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead), account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees. Foreign securities held by the portfolio
may trade on days when the portfolio does not calculate its NAV and thus affect
the portfolio's NAV on days when investors have no access to the portfolio.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
Account Information
<Page 7>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
<Page 8>
NOTES
For More Information
Dreyfus Investment Portfolios
European Equity Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
181P1200
Dreyfus Investment Portfolios
Founders Discovery Portfolio
Investing in stocks of smaller-cap growth companies for capital appreciation
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Founders Discovery Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks capital appreciation. To pursue this goal, the portfolio
invests primarily in equity securities of small, U.S.-based companies which are
characterized as "growth" companies. These companies typically are not listed on
a national securities exchange, but trade on the over-the-counter market. The
portfolio may purchase securities of companies in initial public offerings or
shortly thereafter.
The portfolio manager seeks investment opportunities for the portfolio in
companies with fundamental strengths that indicate the potential for growth in
earnings per share. The portfolio manager focuses on individual stock selection
(a "bottom-up" approach) rather than on forecasting stock market trends (a
"top-down" approach).
The portfolio may invest up to 30% of its assets in foreign securities. The
portfolio may invest in securities of larger issuers if the portfolio manager
believes these securities offer attractive opportunities for capital
appreciation. The portfolio also may invest in investment grade debt securities
of domestic or foreign issuers that the portfolio manager believes -- based on
market conditions, the financial condition of the issuer, general economic
conditions, and other relevant factors -- offer opportunities for capital
appreciation.
Concepts to understand
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings,
price-to-book and price-to-sales ratios, and tend to be more volatile than value
stocks.
SMALL COMPANIES: generally, those companies with market capitalizations of less
than $2.2 billion. This range may fluctuate depending on changes in the value of
the stock market as a whole. Small companies tend to grow faster than large-cap
companies, but frequently are more volatile, are more vulnerable to major
setbacks, and have a higher failure rate than large companies.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio may invest in preferred stocks and convertible securities rated at
the time of purchase at least B by a credit rating agency or the unrated
equivalent as determined by the portfolio's sub-adviser.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, sometimes dramatically, which means that
shareholders could lose money.
Small companies carry additional risks because their operating histories tend to
be more limited, their earnings less predictable, their share prices more
volatile and their securities less liquid than larger, more established
companies. Some of the portfolio' s investments will rise and fall based on
investor perceptions rather than economics.
Because the portfolio may allocate relatively more assets to certain industry
sectors than others, the portfolio's performance may be more susceptible to any
developments which affect those sectors emphasized by the portfolio.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
Any foreign securities purchased by the portfolio are subject to special risks,
such as exposure to currency fluctuations, changing political climate, lack of
comprehensive company information and potentially less liquidity.
The portfolio may purchase securities of companies in initial public offerings
(IPOs) . The prices of securities purchased in IPOs can be very volatile. The
effect of IPOs on the portfolio's performance depends on a variety of factors,
including the number of IPOs the portfolio invests in, whether and to what
extent a security purchased in an IPO appreciates in value, and the asset base
of the portfolio. As a portfolio' s asset base increases, IPOs often have a
diminished effect on such portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.90% 0.90%
Rule 12b-1 fee none 0.25%
Other expenses 0.63% 0.63%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 1.53% 1.78%
Fee waiver and/or expense
reimbursement (0.03%) (0.28%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.50% 1.50%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.50%.
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $153 $480
SERVICE SHARES $153 $533
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The three-year number is based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 0.90% of the portfolio's average
daily net assets. For the fiscal period December 15, 1999 (commencement of
operations) through December 31, 1999, the portfolio did not pay Dreyfus a
management fee as a result of a fee waiver/expense reimbursement in effect.
Dreyfus is the primary mutual fund business of Mellon Financial Corporation, a
global financial services company with approximately $2.8 trillion of assets
under management, administration or custody, including approximately $540
billion under management. Mellon provides wealth management, global investment
services and a comprehensive array of banking services for individuals,
businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
Dreyfus has engaged its growth specialist affiliate, Founders Asset Management
LLC, to serve as the portfolio's sub-investment adviser. Founders, located at
Founders Financial Center, 2930 East Third Avenue, Denver, Colorado 80206, and
its predecessor companies have been offering tools to help investors pursue
their financial goals since 1938. As of September 30, 2000, Founders managed
mutual funds and other client accounts having aggregate assets of approximately
$8.9 billion.
The portfolio' s primary portfolio manager is Robert T. Ammann, C.F.A. He has
been the portfolio's primary portfolio manager since the portfolio's inception
and has been employed by Founders since 1993. He is a vice president of
investments at Founders.
The portfolio, Dreyfus, Founders and Dreyfus Service Corporation (the
portfolio' s distributor) each has adopted a code of ethics that permits its
personnel, subject to such code, to invest in securities, including securities
that may be purchased or held by the portfolio. The Dreyfus and Founders codes
of ethics restrict the personal securities transactions of their employees, and
require portfolio managers and other investment personnel to comply with the
code's preclearance and disclosure procedures. Each code's primary purpose is to
ensure that personal trading by Dreyfus or Founders employees does not
disadvantage any Dreyfus- or Founders-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance Information for Related Public Fund
The portfolio has the same investment objective and follows substantially the
same investment policies and strategies as a corresponding series of another
open-end investment company advised by Founders, the Dreyfus Founders Discovery
Fund (the "Public Fund"). The portfolio currently has the same primary portfolio
manager as the Public Fund. The table at the right shows average annual total
return information for the Public Fund and for the Russell 2000 Index, the
benchmark index of the portfolio and the Public Fund. NO PERFORMANCE INFORMATION
IS SHOWN FOR THE PORTFOLIO, WHICH DID NOT HAVE ITS OWN FULL YEAR OF PERFORMANCE
AS OF SEPTEMBER 30, 2000.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses, after fee waiver and expense reimbursement, for the year
ended December 31, 1999 were 1.46% of its average daily net assets. The
performance figures for the Public Fund also do not reflect the deduction of
charges or expenses attributable to VA contracts or VLI policies, which would
lower the performance quoted. Policy owners should refer to the applicable
insurance company prospectus for information on any such charges and expenses.
Additionally, although it is anticipated that the portfolio and the Public Fund
will hold similar securities, their investment results are expected to differ.
In particular, differences in asset size and in cash flow resulting from
purchases and redemptions of portfolio shares may result in different security
selections, differences in the relative weightings of securities or differences
in the price paid for particular portfolio holdings.
The one-year performance of the Public Fund was due in part to the allocation to
the Public Fund of securities sold in IPOs. There is no guarantee that the
Public Fund' s investments in IPOs will continue to have a similar impact on
performance, and such returns should not be expected over the long term.
Historical performance information for the Public Fund and for the Russell 2000
Index for various periods ended September 30, 2000, as calculated pursuant to
SEC guidelines, is as follows:
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Average annual total return AS OF 9/30/00
1 Year 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------------
FOUNDERS DISCOVERY
<S> <C> <C> <C>
FUND -- CLASS F* 59.18% 27.76% 25.31%
RUSSELL 2000
INDEX** 23.39% 12.38% 16.93%
* CLASS F SHARES ARE GENERALLY CLOSED TO NEW INVESTORS.
** THE RUSSELL 2000 INDEX IS A WIDELY RECOGNIZED, UNMANAGED SMALL-CAP INDEX
COMPRISED OF THE COMMON STOCKS OF THE 2,000 U.S. PUBLIC COMPANIES NEXT IN
SIZE AFTER THE LARGEST 1,000 PUBLICLY TRADED U.S. COMPANIES. ALL
PERFORMANCE FIGURES REFLECT THE REINVESTMENT OF DIVIDENDS AND OTHER
DISTRIBUTIONS.
</TABLE>
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
---------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 13.89 12.50
Investment operations: Investment income (loss) -- net (.05)(2) .01
Net realized and unrealized gain (loss) on investments 2.60 1.38
Total from investment operations 2.55 1.39
Distributions: Dividends from investment income -- net (.01) --
Dividends from net realized gain on investments (.05) --
Total distributions (.06) --
Net asset value, end of period 16.38 13.89
Total return (%) 18.33(3) 11.12(3)
--------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .75(3) .07(3)
Ratio of net investment income (loss) to average net assets (%) (.35)(3) .06(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%)
1.10(3) 1.45(3)
Portfolio turnover rate (%) 63.12(3) 7.49(3)
--------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 6,564 2,223
(1) FROM DECEMBER 15, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
PORTFOLIO SHARES MAY BE PURCHASED or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares.
THE PRICE FOR PORTFOLIO SHARES is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided the orders are received by the portfolio in
proper form on the next business day. The participating insurance company is
responsible for properly transmitting purchase and sale orders.
WIRE PURCHASE PAYMENTS MAY BE MADE if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: FOUNDERS DISCOVERY
PORTFOLIO/SHARE CLASS), for purchase of portfolio shares. The wire must include
the portfolio account number (for new accounts, a taxpayer identification
number should be included instead) and account registration and dealer number,
if applicable, of the participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
THE PORTFOLIO USUALLY PAYS DIVIDENDS from its net investment income and
distributes any net capital gains it has realized once a year.
EACH SHARE CLASS WILL GENERATE a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
SHAREHOLDERS CAN EXCHANGE SHARES of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Founders Discovery Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from:
http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
193P1200
Dreyfus Investment Portfolios
Founders Growth Portfolio
Investing in stock of growth companies for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Founders Growth Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term growth of capital. To pursue this goal, the
portfolio invests primarily in equity securities of well-established, high
quality "growth" companies. These companies tend to have strong performance
records, solid market positions and reasonable financial strength, and have
continuous operating records of three years or more.
The portfolio will seek investment opportunities, generally, in companies which
the portfolio managers believe have fundamental strengths that indicate the
potential for growth in earnings per share. The portfolio managers focus on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio may invest up to 30% of its assets in foreign securities, and up
to 25% of its assets in any one foreign country. The portfolio also may invest
in investment grade debt securities of domestic or foreign issuers that the
portfolio managers believe -- based on market conditions, the financial
condition of the issuer, general economic conditions, and other relevant factors
-- offer opportunities for capital growth.
Concepts to understand
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings,
price-to-book and price-to-sales ratios, and tend to be more volatile than value
stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
While the portfolio' s investments in stocks of well-established companies may
limit the overall downside risk of the portfolio over time, the portfolio may
produce more modest gains than riskier stock funds as a trade-off for this
potentially lower risk.
Because the portfolio may allocate relatively more assets to certain industry
sectors than others, the portfolio's performance may be more susceptible to any
developments which affect those sectors emphasized by the portfolio.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
Any foreign securities purchased by the portfolio include special risks, such as
exposure to currency fluctuations, changing political climate, lack of
comprehensive company information and potentially less liquidity.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
<TABLE>
<CAPTION>
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the
portfolio. The bar chart shows the performance of the portfolio's Initial shares
for the portfolio's first full calendar year of operations. The table compares
the average annual total return of the Initial shares to that of the Standard &
Poor's 500/BARRA Growth Index (S&P 500 BARRA Growth), which has been selected as
the portfolio' s primary index based on the portfolio's and the index's growth
orientation, and the Standard & Poor's 500 Composite Stock Price Index (S&P 500
Composite) , each a broad measure of stock performance. Performance for the S&P
500 Composite will not be shown in the future. All performance figures reflect
the reinvestment of dividends and distributions. Of course, past performance is
no guarantee of future results. As a new class, past performance information is
not available for Service shares as of the date of this prospectus.
--------------------------------------------------------------------------------
Year-by-year total return AS OF 12/31 EACH YEAR (%)
39.01
90 91 92 93 94 95 96 97 98 99
INITIAL SHARES
BEST QUARTER: Q4 '99 +30.13%
WORST QUARTER: Q3 '99 -4.29%
--------------------------------------------------------------------------------
Average annual total return AS OF 12/31/99
Since
inception
1 Year (9/30/98)
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INITIAL SHARES 39.01% 57.77%
S&P 500 BARRA GROWTH 28.25% 45.19%
S&P 500 COMPOSITE 21.03% 35.94%
</TABLE>
Additional costs
Performance information reflects the portfolio's expenses only and does not
reflect the fees and charges imposed by participating insurance companies under
their VA contracts or VLI policies. Because these fees and charges will reduce
total return, VA contract holders and VLI policyholders should consider them
when evaluating and comparing the portfolio's performance. VA contract holders
and VLI policyholders should consult the prospectus for their contract or policy
for more information.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price. As
with the performance information given previously, these figures do not reflect
any fees or charges imposed by participating insurance companies under their VA
contracts or VLI policies.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.75% 0.75%
Rule 12b-1 fee none 0.25%
Other expenses 1.58% 1.58%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 2.33% 2.58%
Fee waiver and/or expense
reimbursement (1.33%) (1.58%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.00% 1.00%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.00%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $102 $600 $1,124 $2,563
SERVICE SHARES $102 $652 $1,228 $2,797
</TABLE>
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on net
operating expenses. The longer-term numbers are based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. For the past fiscal year, the
portfolio did not pay Dreyfus a management fee as a result of a fee
waiver/expense reimbursement in effect. Dreyfus is the primary mutual fund
business of Mellon Financial Corporation, a global financial services company
with approximately $2.8 trillion of assets under management, administration or
custody, including approximately $540 billion under management. Mellon provides
wealth management, global investment services and a comprehensive array of
banking services for individuals, businesses and institutions. Mellon is
headquartered in Pittsburgh, Pennsylvania.
Dreyfus has engaged its growth specialist affiliate, Founders Asset Management
LLC, to serve as the portfolio's sub-investment adviser. Founders, located at
Founders Financial Center, 2930 East Third Avenue, Denver, Colorado 80206, and
its predecessor companies have been offering tools to help investors pursue
their financial goals since 1938. As of September 30, 2000, Founders managed
mutual funds and other client accounts having aggregate assets of approximately
$8.9 billion.
The portfolio' s primary portfolio managers are Scott A. Chapman, C.F.A. and
Thomas M. Arrington, C.F.A. Mr. Chapman and Mr. Arrington have been the
portfolio' s primary portfolio managers, and have been employed by Founders,
since December 1998. Mr. Chapman is a vice president of investments and director
of research at Founders. Mr. Arrington is a vice president of investments at
Founders. Prior to joining Founders, Mr. Chapman was employed for seven years at
HighMark Capital Management, Inc., a subsidiary of Union BanCal Corporation,
most recently as a vice president and director of growth strategy. Prior to
joining Founders, Mr. Arrington was employed for eight years at HighMark Capital
where he held various positions, including vice president and director of income
and growth strategy, securities research analyst and, most recently, vice
president and director of income equity strategy.
The portfolio, Dreyfus, Founders and Dreyfus Service Corporation (the
portfolio' s distributor) each has adopted a code of ethics that permits its
personnel, subject to such code, to invest in securities, including securities
that may be purchased or held by the portfolio. The Dreyfus and Founders codes
of ethics restrict the personal securities transactions of their employees, and
require portfolio managers and other investment personnel to comply with the
code's preclearance and disclosure procedures. Each code's primary purpose is to
ensure that personal trading by Dreyfus or Founders employees does not
disadvantage any Dreyfus- or Founders-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance information for Public Fund and Portfolio
The portfolio has the same investment objective and follows substantially the
same investment policies and strategies as a corresponding series of another
open-end investment company advised by Founders, the Dreyfus Founders Growth
Fund (the "Public Fund"). The portfolio currently has the same primary portfolio
managers as the Public Fund. The first table at right shows average annual total
return information for the Public Fund, the S&P 500 BARRA Growth and the S&P
500( )Composite. The second table shows average annual total return information
for the portfolio, the S& P 500 BARRA Growth and the S&P 500 Composite
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses, after fee waiver and expense reimbursement, for the year
ended December 31, 1999 were 1.09% of its average daily net assets. The
performance figures for the Public Fund and the portfolio also do not reflect
the deduction of charges or expenses attributable to VA contracts or VLI
policies, which would lower the performance quoted. Policy owners should refer
to the applicable insurance company prospectus for information on any such
charges and expenses. Additionally, although it is anticipated that the
portfolio and the Public Fund will hold similar securities, their investment
results are expected to differ. In particular, differences in asset size and in
cash flow resulting from purchases and redemptions of portfolio shares may
result in different security selections, differences in the relative weightings
of securities or differences in the price paid for particular portfolio
holdings. Performance information for the Public Fund and the portfolio reflect
the reinvestment of dividends and other distributions.
<TABLE>
<CAPTION>
PUBLIC FUND
Historical performance information for the Public Fund, the S&P 500 BARRA Growth
and the S& P 500 Composite for various periods ended September 30, 2000, as
calculated pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
1 Year 5 Years 10 Years
----------------------------------------------------------------------------------------------------------
DREYFUS FOUNDERS GROWTH
<S> <C> <C> <C>
FUND -- CLASS F* 27.90% 20.95% 21.61%
S&P 500 BARRA
GROWTH** 12.04% 24.95% 20.93%
S&P 500 COMPOSITE*** 13.27% 21.67% 19.42%
</TABLE>
PORTFOLIO
Average annual total returns for the portfolio's Initial shares, the S&P BARRA
Growth and the S&P 500 Composite for various periods ended September 30, 2000,
as calculated pursuant to SEC guidelines, are as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
inception
1 Year (9/30/98)
--------------------------------------------------------------------------------
FOUNDERS GROWTH
PORTFOLIO -- INITIAL SHARES 27.20% 31.47%
S&P 500 BARRA GROWTH** 12.04% 22.24%
S&P 500 COMPOSITE*** 13.27% 20.31%
--------------------------------------------------------------------------------
* CLASS F SHARES ARE GENERALLY CLOSED TO NEW INVESTORS.
** THE S& P BARRA GROWTH IS A CAPITALIZATION-WEIGHTED INDEX OF ALL THE STOCKS
IN THE S& P 500 COMPOSITE THAT HAVE HIGH PRICE-TO-BOOK RATIOS. ALL
PERFORMANCE FIGURES REFLECT THE REINVESTMENT OF DIVIDENDS AND OTHER
DISTRIBUTIONS.
*** THE S& P 500 COMPOSITE IS A WIDELY RECOGNIZED, UNMANAGED INDEX OF STOCK
PERFORMANCE. ALL PERFORMANCE FIGURES REFLECT THE REINVESTMENT OF DIVIDENDS
AND OTHER DISTRIBUTIONS.
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
INITIAL SHARES 2000 1999 1998(1)
---------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C> <C>
Net asset value, beginning of period 19.87 15.90 12.50
Investment operations: Investment income (loss) -- net .00(2,3) (.02)(2) .01
Net realized and unrealized
gain (loss) on investments (.75) 5.79 3.39
Total from investment operations (.75) 5.77 3.40
Distributions: Dividends from investment
income -- net -- (.01) --
Dividends from net realized
gain on investments (.13) (1.79) --
Total distributions (.13) (1.80) --
Net asset value, end of period 18.99 19.87 15.90
Total return (%) (3.72)(4) 39.01 27.20(4)
----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .50(4) 1.00 .25(4)
Ratio of net investment income (loss) to average
net assets (%) .00(4,5) (.11) .05(4)
Decrease reflected in above expense ratios
due to actions by Dreyfus (%) .14(4) 1.33 .31(4)
Portfolio turnover rate (%) 101.25(4) 115.08 75.65(4)
----------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 17,894 7,485 2,544
(1) FROM SEPTEMBER 30, 1998 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1998.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) AMOUNT REPRESENTS LESS THAN $.01 PER SHARE.
(4) NOT ANNUALIZED.
(5) AMOUNT REPRESENTS LESS THAN .01%.
The Portfolio
</TABLE>
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Founders Growth Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead), account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Founders Growth Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio managers discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from:
http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
176P1200
Dreyfus Investment Portfolios
Founders International Equity Portfolio
Investing in stocks of foreign growth companies
for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Founders International Equity Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term growth of capital. To pursue this goal, the
portfolio invests primarily in equity securities of foreign issuers which are
characterized as "growth" companies. The portfolio may purchase securities of
companies in initial public offerings or shortly thereafter.
The portfolio will seek investment opportunities, generally, in companies which
the portfolio manager believes have fundamental strengths that indicate the
potential for growth in earnings per share. The portfolio manager focuses on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio will invest primarily in foreign issuers from at least three
foreign countries with established or emerging economies, but will not invest
more than 50% of its assets in issuers in any one foreign country. Although the
portfolio intends to invest substantially all of its assets in issuers located
outside the United States, at times it may invest in U.S.-based companies. The
portfolio also may invest in investment grade debt securities of foreign issuers
that the portfolio manager believes -- based on market conditions, the financial
condition of the issuer, general economic conditions, and other relevant factors
-- offer opportunities for capital growth.
Concepts to understand
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings,
price-to-book and price-to-sales ratios, and tend to be more volatile than value
stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
The Portfolio
<Page 1>
MAIN RISKS
The portfolio's performance will be influenced by political, social and economic
factors affecting companies in foreign countries. Like the stocks of U.S.
companies, the securities of foreign issuers fluctuate in price, often based on
factors unrelated to the issuers' value, and such fluctuations can be
pronounced. The prices of securities purchased in initial public offerings or
shortly thereafter may be very volatile. Unlike investing in U.S. companies,
foreign securities include special risks such as exposure to currency
fluctuations, a lack of comprehensive company information, political
instability, and differing auditing and legal standards. The value of a
shareholder' s investment in the portfolio will go up and down, which means that
shareholders could lose money.
Because the portfolio may allocate relatively more assets to certain industry
sectors than others, the portfolio's performance may be more susceptible to any
developments which affect those sectors emphasized by the portfolio.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
The portfolio may invest in the stocks of companies located in developed
countries and in emerging markets. Emerging market countries generally have
economic structures that are less diverse and mature, and political systems that
are less stable, than those of developed countries. Emerging markets may be more
volatile than the markets of more mature economies, and the securities of
companies located in emerging markets are often subject to rapid and large
changes in price; however, these markets also may provide higher long-term rates
of return.
The portfolio may purchase securities of companies in initial public offerings
(IPOs) . The prices of securities purchased in IPOs can be very volatile. The
effect of IPOs on the portfolio's performance depends on a variety of factors,
including the number of IPOs the portfolio invests in, whether and to what
extent a security purchased in an IPO appreciates in value, and the asset base
of the portfolio. As a portfolio' s asset base increases, IPOs often have a
diminished effect on such portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the
portfolio. The bar chart shows the performance of the portfolio's Initial shares
for the portfolio's first full calendar year of operations. The table compares
the average annual total return of the Initial shares to that of the Morgan
Stanley Capital International (MSCI) World (ex. US) Index, a broad measure of
international stock performance. All performance figures reflect the
reinvestment of dividends and distributions. Of course, past performance is no
guarantee of future results. As a new class, past performance information is not
available for Service shares as of the date of this prospectus.
--------------------------------------------------------------------------------
Year-by-year total return AS OF 12/31 EACH YEAR (%)
INITIAL SHARES
60.69
90 91 92 93 94 95 96 97 98 99
BEST QUARTER: Q4 '99 +40.36%
WORST QUARTER: Q1 '99 +2.44%
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Average annual total return AS OF 12/31/99
Since
inception
1 Year (9/30/98)
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INITIAL SHARES 60.69% 63.30%
MSCI WORLD
(EX. US) INDEX 27.93% 41.33%
Additional costs
</TABLE>
Performance information reflects the portfolio's expenses only and does not
reflect the fees and charges imposed by participating insurance companies under
their VA contracts or VLI policies. Because these fees and charges will reduce
total return, VA contract holders and VLI policyholders should consider them
when evaluating and comparing the portfolio's performance. VA contract holders
and VLI policyholders should consult the prospectus for their contract or policy
for more information.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price. As
with the performance information given previously, these figures do not reflect
any fees or charges imposed by participating insurance companies under their VA
contracts or VLI policies.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 1.00% 1.00%
Rule 12b-1 fee none 0.25%
Other expenses 2.77% 2.77%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 3.77% 4.02%
Fee waiver and/or expense
reimbursement (2.27%) (2.52%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.50% 1.50%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.50%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $153 $943 $1,752 $3,865
SERVICE SHARES $153 $993 $1,850 $4,067
</TABLE>
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on net
operating expenses. The longer-term numbers are based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as the principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. For the past fiscal year, the
portfolio did not pay Dreyfus a management fee as a result of a fee
waiver/expense reimbursement in effect. Dreyfus is the primary mutual fund
business of Mellon Financial Corporation, a global financial services company
with approximately $2.8 trillion of assets under management, administration or
custody, including approximately $540 billion under management. Mellon provides
wealth management, global investment services and a comprehensive array of
banking services for individuals, businesses and institutions. Mellon is
headquartered in Pittsburgh, Pennsylvania.
Dreyfus has engaged its growth specialist affiliate, Founders Asset Management
LLC, to serve as the portfolio's sub-investment adviser. Founders, located at
Founders Financial Center, 2930 East Third Avenue, Denver, Colorado 80206, and
its predecessor companies have been offering tools to help investors pursue
their financial goals since 1938. As of September 30, 2000, Founders managed
mutual funds and other client accounts having aggregate assets of approximately
$8.9 billion.
The portfolio's primary portfolio manager is Douglas A. Loeffler, C.F.A. He has
been the portfolio's primary portfolio manager since the portfolio's inception
and has been employed by Founders since 1995. He is a vice president of
investments at Founders. Prior to joining Founders, Mr. Loeffler was employed
for seven years at Scudder, Stevens & Clark as an international equities and
quantitative analyst.
The portfolio, Dreyfus, Founders and Dreyfus Service Corporation (the
portfolio' s distributor) each has adopted a code of ethics that permits its
personnel, subject to such code, to invest in securities, including securities
that may be purchased or held by the portfolio. The Dreyfus and Founders codes
of ethics restrict the personal securities transactions of their employees, and
require portfolio managers and other investment personnel to comply with the
code's preclearance and disclosure procedures. Each code's primary purpose is to
ensure that personal trading by Dreyfus or Founders employees does not
disadvantage any Dreyfus- or Founders-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance information for Public Fund and Portfolio
The portfolio has the same investment objective and follows substantially the
same investment policies and strategies as a corresponding series of another
open-end investment company advised by Founders, the Dreyfus Founders
International Equity Fund (the "Public Fund"). The portfolio currently has the
same primary portfolio manager as the Public Fund. The first table at right
shows average annual total return information for the Public Fund and for the
MSCI World (ex. US) Index, the benchmark index of the portfolio and the Public
Fund. The second table shows average annual total return information for the
portfolio and the MSCI World (ex. US) Index.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses, after fee waiver and expense reimbursement, for the year
ended December 31, 1999 were 1.80% of its average daily net assets. The
performance figures for the Public Fund and the portfolio also do not reflect
the deduction of charges or expenses attributable to VA contracts or VLI
policies, which would lower the performance quoted. Policy owners should refer
to the applicable insurance company prospectus for information on any such
charges and expenses. Additionally, although it is anticipated that the
portfolio and the Public Fund will hold similar securities, their investment
results are expected to differ. In particular, differences in asset size and in
cash flow resulting from purchases and redemptions of portfolio shares may
result in different security selections, differences in the relative weightings
of securities or differences in the price paid for particular portfolio
holdings. Performance information for the Public Fund and the portfolio reflect
the reinvestment of dividends and other distributions.
The one-year performance of the Public Fund and the portfolio was due in part to
the allocation to the Public Fund and to the portfolio of securities sold in
IPOs. There is no guarantee that investments in IPOs by the Public Fund or the
portfolio will continue to have a similar impact on performance, and such
returns should not be expected over the long term.
PUBLIC FUND
Historical performance information for the Public Fund and for the MSCI World
(ex. US) Index for various periods ended September 30, 2000, as calculated
pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
inception
1 Year (12/29/95)
--------------------------------------------------------------------------------
DREYFUS FOUNDERS INTERNATIONAL EQUITY
FUND -- CLASS F* 23.74% 18.77%
MSCI WORLD
(EX. US) INDEX** 5.24% 8.73%***(
PORTFOLIO
Average annual total return for the portfolio's Initial shares and for the MSCI
World (Ex.US) Index for various periods ended September 30, 2000, as calculated
pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
inception
1 Year (9/30/98)
--------------------------------------------------------------------------------
FOUNDERS INTERNATIONAL EQUITY
PORTFOLIO -- INITIAL SHARES 24.58% 28.00%
MSCI WORLD
(EX. US) INDEX** 5.24% 17.54%
--------------------------------------------------------------------------------
* CLASS F SHARES ARE GENERALLY CLOSED TO NEW INVESTORS.
** THE MSCI WORLD (EX. US) INDEX IS AN ARITHMETICAL AVERAGE OF THE
PERFORMANCE OF OVER 1,000 SECURITIES LISTED ON THE STOCK EXCHANGES OF
EUROPE, CANADA, AUSTRALIA, NEW ZEALAND AND THE FAR EAST. TOTAL RETURN
FIGURES FOR THE INDEX ASSUME CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AFTER DEDUCTION OF LOCAL TAXES, BUT DO NOT DEDUCT ANY FEES OR
EXPENSES WHICH ARE CHARGED TO THE PUBLIC FUND AND THE PORTFOLIO.
*** FOR COMPARATIVE PURPOSES, THE VALUE OF THE INDEX ON 12/31/95 IS USED AS THE
BEGINNING VALUE ON 12/29/95.
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
INITIAL SHARES 2000 1999 1998(1)
--------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C> <C>
Net asset value, beginning of period 21.65 14.36 12.50
Investment operations: Investment income (loss) -- net .04(2) (.02)(2) (.01)
Net realized and unrealized gain (loss) on investments (.59) 8.73 1.87
Total from investment operations (.55) 8.71 1.86
Distributions: Dividends from net realized gain on investments (1.10) (1.42) --
Net asset value, end of period 20.00 21.65 14.36
Total return (%) (2.83)(3) 60.69 14.88(3)
---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .75(3) 1.50 .38(3)
Ratio of investment income (loss) to average net assets (%) .18(3) (.11) (.08)(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) .59(3) 2.27 .81(3)
Portfolio turnover rate (%) 108.14(3) 190.80 29.25(3)
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 9,616 4,608 2,297
(1) FROM SEPTEMBER 30, 1998 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1998.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Founders International Equity
Portfolio/share class), for purchase of portfolio shares. The wire must include
the portfolio account number (for new accounts, a taxpayer identification number
should be included instead) , account registration and dealer number, if
applicable, of the participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees. Foreign securities held by the portfolio
may trade on days when the portfolio does not calculate its NAV and thus affect
the portfolio's NAV on days when investors have no access to the portfolio.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Founders International Equity Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
177P1200
Dreyfus Investment Portfolios
Founders Passport Portfolio
Investing in stocks of smaller foreign
growth companies for capital appreciation
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Founders Passport Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks capital appreciation. To pursue this goal, the portfolio
invests primarily in equity securities of foreign small-cap companies that are
characterized as "growth" companies. The portfolio may purchase securities of
companies in initial public offerings (IPOs) or shortly thereafter.
The portfolio seeks investment opportunities, generally, in companies which the
portfolio manager believes have fundamental strengths that indicate the
potential for growth in earnings per share. The portfolio manager focuses on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio will invest primarily in foreign issuers from at least three
foreign countries with established or emerging economies. The portfolio may
invest in securities of larger foreign issuers or in U.S. issuers, if the
portfolio manager believes these securities offer attractive opportunities for
capital appreciation.
The portfolio also may invest in investment grade debt securities of domestic or
foreign issuers that the portfolio manager believes -- based on market
conditions, the financial condition of the issuer, general economic conditions,
and other relevant factors -- offer opportunities for capital appreciation.
Concepts to understand
FOREIGN SMALL-CAP COMPANIES: generally those foreign companies with market
capitalizations of less than $1.5 billion. This range may fluctuate depending on
changes in the value of the stock market as a whole.
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings,
price-to-book and price-to-sales ratios, and tend to be more volatile than value
stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
The Portfolio
<Page 1>
MAIN RISKS
The portfolio's performance will be influenced by political, social and economic
factors affecting companies in foreign countries. Like the stocks of U.S.
companies, the securities of foreign issuers fluctuate in price, often based on
factors unrelated to the issuers' value, and such fluctuations can be
pronounced. Unlike investing in U.S. companies, foreign securities include
special risks such as exposure to currency fluctuations, a lack of comprehensive
company information, political instability, and differing auditing and legal
standards. The value of a shareholder's investment in the portfolio will go up
and down, which means that shareholders could lose money.
Because the portfolio may allocate relatively more assets to certain industry
sectors than others, the portfolio's performance may be more susceptible to any
developments which affect those sectors emphasized by the portfolio.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
The portfolio may invest in the stocks of companies located in developed
countries and in emerging markets. Emerging market countries generally have
economic structures that are less diverse and mature, and political systems that
are less stable, than those of developed countries. Emerging markets may be more
volatile than the markets of more mature economies, and the securities of
companies located in emerging markets are often subject to rapid and large
changes in price; however, these markets also may provide higher long-term rates
of return.
The portfolio invests primarily in securities issued by companies with
relatively small market capitalizations. Smaller companies typically carry
additional risks because their earnings tend to be less predictable, their share
prices more volatile and their securities less liquid than larger,
more-established companies.
The portfolio may purchase securities of companies in IPOs. The prices of
securities purchased in IPOs can be very volatile. The effect of IPOs on the
portfolio's performance depends on a variety of factors, including the number of
IPOs the portfolio invests in, whether and to what extent a security purchased
in an IPO appreciates in value, and the asset base of the portfolio. As a
portfolio' s asset base increases, IPOs often have a diminished effect on such
portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the
portfolio. The bar chart shows the performance of the portfolio's Initial shares
for the portfolio's first full calendar year of operations. The table compares
the average annual total return of the Initial shares to that of the Morgan
Stanley Capital International (MSCI) World (ex. US) Index, a broad measure of
international stock performance. All performance figures reflect the
reinvestment of dividends and distributions. Of course, past performance is no
guarantee of future results. As a new class, past performance information is not
available for Service shares as of the date of this prospectus.
--------------------------------------------------------------------------------
Year-by-year total return AS OF 12/31 EACH YEAR (%)
INITIAL SHARES
76.05
90 91 92 93 94 95 96 97 98 99
BEST QUARTER: Q4 '99 +53.13%
WORST QUARTER: Q1 '99 +3.55%
--------------------------------------------------------------------------------
Average annual total return AS OF 12/31/99
Since
inception
1 Year (9/30/98)
--------------------------------------------------------------------------------
INITIAL SHARES 76.05% 76.79%
MSCI WORLD (EX. US)
INDEX 27.93% 41.33%
Additional costs
Performance information reflects the portfolio's expenses only and does not
reflect the fees and charges imposed by participating insurance companies under
their VA contracts or VLI policies. Because these fees and charges will reduce
total return, VA contract holders and VLI policyholders should consider them
when evaluating and comparing the portfolio's performance. VA contract holders
and VLI policyholders should consult the prospectus for their contract or policy
for more information.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price. As
with the performance information given previously, these figures do not reflect
any fees or charges imposed by participating insurance companies under their VA
contracts or VLI policies.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 1.00% 1.00%
Rule 12b-1 fee none 0.25%
Other expenses 2.64% 2.64%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 3.64% 3.89%
Fee waiver and/or expense
reimbursement (2.14%) (2.39%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.50% 1.50%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.50%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $153 $916 $1,701 $3,758
SERVICE SHARES $153 $967 $1,799 $3,962
</TABLE>
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on net
operating expenses. The longer-term numbers are based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. For the past fiscal year, the
portfolio did not pay Dreyfus a management fee as a result of a fee
waiver/expense reimbursement in effect. Dreyfus is the primary mutual fund
business of Mellon Financial Corporation, a global financial services company
with approximately $2.8 trillion of assets under management, administration or
custody, including approximately $540 billion under management. Mellon provides
wealth management, global investment services and a comprehensive array of
banking services for individuals, businesses and institutions. Mellon is
headquartered in Pittsburgh, Pennsylvania.
Dreyfus has engaged its growth specialist affiliate, Founders Asset Management
LLC, to serve as the portfolio's sub-investment adviser. Founders, located at
Founders Financial Center, 2930 East Third Avenue, Denver, Colorado 80206, and
its predecessor companies have been offering tools to help investors pursue
their financial goals since 1938. As of September 30, 2000, Founders managed
mutual funds and other client accounts having aggregate assets of approximately
$8.9 billion.
The portfolio's primary portfolio manager is Tracy P. Stouffer. She has been the
portfolio' s primary portfolio manager, and has been employed by Founders, since
July 1999. Prior to joining Founders, Ms. Stouffer was a vice president and
portfolio manager with Federated Global Incorporated from 1995 to July 1999, and
a vice president and portfolio manager with Clariden Asset Management, Inc. from
1988 to 1995.
The portfolio, Dreyfus, Founders and Dreyfus Service Corporation (the
portfolio' s distributor) each has adopted a code of ethics that permits its
personnel, subject to such code, to invest in securities, including securities
that may be purchased or held by the portfolio. The Dreyfus and Founders codes
of ethics restrict the personal securities transactions of their employees, and
require portfolio managers and other investment personnel to comply with the
code's preclearance and disclosure procedures. Each code's primary purpose is to
ensure that personal trading by Dreyfus or Founders employees does not
disadvantage any Dreyfus- or Founders-managed fund.
The Portfolio
<Page 5>
MANAGEMENT (CONTINUED)
Performance information for Public Fund and Portfolio
The portfolio has the same investment objective and follows substantially the
same investment policies and strategies as a corresponding series of another
open-end investment company advised by Founders, the Dreyfus Founders Passport
Fund (the "Public Fund"). The portfolio currently has the same primary portfolio
manager as the Public Fund. The first table at right shows average annual total
return information for the Public Fund and for the MSCI World (ex. US) Index,
the benchmark index of the portfolio and the Public Fund. The second table shows
average annual total return information for the portfolio and the MSCI World
(ex. US) Index.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Public Fund
reflect the deduction of the historical fees and expenses paid by the Public
Fund, and not those paid by the portfolio. The Public Fund's total annual
operating expenses, after fee waiver and expense reimbursement, for the year
ended December 31, 1999 were 1.64% of its average daily net assets. The
performance figures for the Public Fund and the portfolio also do not reflect
the deduction of charges or expenses attributable to VA contracts or VLI
policies, which would lower the performance quoted. Policy owners should refer
to the applicable insurance company prospectus for information on any such
charges and expenses. Additionally, although it is anticipated that the
portfolio and the Public Fund will hold similar securities, their investment
results are expected to differ. In particular, differences in asset size and in
cash flow resulting from purchases and redemptions of portfolio shares may
result in different security selections, differences in the relative weightings
of securities or differences in the price paid for particular portfolio
holdings. Performance information for the Public Fund and the portfolio reflects
the reinvestment of dividends and other distributions.
The one-year performance of the Public Fund and the portfolio was due in part to
the allocation to the Public Fund and to the portfolio of securities sold in
IPOs. There is no guarantee that investments in IPOs by the Public Fund or the
portfolio will continue to have a similar impact on performance, and such
returns should not be expected over the long term.
<TABLE>
<CAPTION>
PUBLIC FUND
Historical performance information for the Public Fund and for the MSCI World
(ex. US) Index for various periods ended September 30, 2000, as calculated
pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
inception
1 Year 5 Years (11/16/93)
---------------------------------------------------------------------------------------------------------------------------------
DREYFUS FOUNDERS
<S> <C> <C> <C>
PASSPORT FUND -- CLASS F* 39.04% 17.87% 15.04%
MSCI WORLD
(EX. US) INDEX** 5.24% 9.15% 9.91%***
PORTFOLIO
</TABLE>
Average annual total return for the portfolio's Initial shares and for the MSCI
World (ex. US) Index for various periods ended September 30, 2000, as calculated
pursuant to SEC guidelines, is as follows:
--------------------------------------------------------------------------------
Average annual total return AS OF 9/30/00
Since
inception
1 Year (9/30/98)
--------------------------------------------------------------------------------
FOUNDERS PASSPORT
PORTFOLIO -- INITIAL SHARES 39.51% 36.28%
MSCI WORLD (EX. US) INDEX** 5.24% 17.54%
--------------------------------------------------------------------------------
* CLASS F SHARES ARE GENERALLY CLOSED TO NEW INVESTORS.
** THE MSCI WORLD (EX. US) INDEX IS AN ARITHMETICAL AVERAGE OF THE
PERFORMANCE OF OVER 1,000 SECURITIES LISTED ON THE STOCK EXCHANGES OF
EUROPE, CANADA, AUSTRALIA, NEW ZEALAND AND THE FAR EAST. TOTAL RETURN
FIGURES FOR THE INDEX ASSUME CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AFTER DEDUCTION OF LOCAL TAXES, BUT DO NOT DEDUCT ANY FEES OR
EXPENSES WHICH ARE CHARGED TO THE PUBLIC FUND AND THE PORTFOLIO.
*** FOR COMPARATIVE PURPOSES, THE VALUE OF THE INDEX ON 11/30/93 IS USED AS
THE BEGINNING VALUE ON 11/16/93.
<Page 6>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
INITIAL SHARES 2000 1999 1998(1)
---------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C> <C>
Net asset value, beginning of period 23.82 14.46 12.50
Investment operations: Investment income (loss) -- net (.05)(2) (.10)(2) .00(3)
Net realized and unrealized gain (loss) on investments (.99) 11.04 1.97
Total from investment operations (1.04) 10.94 1.97
Distributions: Dividends from investment income -- net -- -- (.00)(3)
Dividends from net realized gain on investments (1.11) (1.58) (.01)
Total distributions (1.11) (1.58) (.01)
Net asset value, end of period 21.67 23.82 14.46
Total return (%) (5.26)(4) 76.05 15.79(4)
---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .75(4) 1.50 .38(4)
Ratio of net investment income (loss) to average net assets (%) (.20)(4) (.60) .02(4)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) 1.01(4) 2.14 .30(4)
Portfolio turnover rate (%) 256.37(4) 319.31 3.98(4)
--------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 26,427 14,836 5,788
(1) FROM SEPTEMBER 30, 1998 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1998.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) AMOUNT REPRESENTS LESS THAN $.01 PER SHARE.
(4) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Founders Passport Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead), account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees. Foreign securities held by the portfolio
may trade on days when the portfolio does not calculate its NAV and thus affect
the portfolio's NAV on days when investors have no access to the portfolio.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Founders Passport Portfolio
---------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
178P1200
Dreyfus Investment Portfolios
Japan Portfolio
Investing in stocks of Japanese companies for long-term capital growth
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Japan Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 7
Account Information
--------------------------------------------------------------------------------
Account Policies 8
Distributions and Taxes 8
Exchange Privilege 9
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks long-term capital growth. To pursue this goal, the portfolio
invests at least 65% of its total assets in stocks of Japanese companies.
Generally, the portfolio invests at least 60% of its assets in Japanese
companies with market caps of at least $1.5 billion at the time of investment.
The portfolio' s investments may include common stocks, preferred stocks and
convertible securities, including those issued in initial public offerings.
In choosing stocks, the portfolio manager identifies and forecasts: key trends
in economic variables, such as gross domestic product, inflation and interest
rates; investment themes, such as the impact of new technologies and the
globalization of industries and brands; relative values of equity securities,
bonds and cash; company fundamentals and long-term trends in currency movements
Within markets and sectors determined to be relatively attractive, the portfolio
manager seeks what are believed to be attractively priced companies that possess
a sustainable competitive advantage in their market or sector. The portfolio
manager generally sells securities when themes or strategies change or when the
portfolio manager determines that a company's prospects have changed or that its
stock is fully valued by the market.
Many of the securities in which the portfolio invests are denominated in yen. To
protect the portfolio against potential depreciation of the yen versus the U.S.
dollar, the portfolio manager may engage in currency hedging.
Concepts to understand
JAPANESE COMPANY: a company organized under the laws of Japan or for which the
principal securities trading market is Japan; or a company, wherever organized,
with a majority of its assets or business in Japan.
CURRENCY HEDGING: the value of the yen can fluctuate significantly relative to
the U.S. dollar and potentially result in losses for investors. To help offset
such losses, the portfolio manager may employ certain techniques designed to
reduce the portfolio's foreign currency exposure. Generally, this involves
buying options, futures, or forward contracts for the foreign currency.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a choice of long-term investors, they do
fluctuate in price. The value of a shareholder's investment in the portfolio
will go up and down, which means that shareholders could lose money.
The portfolio's performance will be influenced by political, social and economic
factors affecting investments in Japanese companies. These risks include changes
in currency exchange rates, a lack of comprehensive company information,
political instability, less liquidity and differing auditing and legal
standards. Each of those risks could result in more volatility for the
portfolio. While investments in all foreign countries are subject to those
risks, the portfolio' s concentration in Japanese securities could cause the
portfolio' s performance to be more volatile than that of more geographically
diversified funds.
Small companies carry additional risks because their operating histories tend to
be more limited, their earnings less predictable, their share prices more
volatile and their securities less liquid than larger, more established
companies. Some of the portfolio' s investments will rise and fall based on
investor perceptions rather than economics.
The portfolio may purchase securities of companies in initial public offerings
(IPOs) . The prices of securities purchased in IPOs can be very volatile. The
effect of IPOs on the portfolio's performance depends on a variety of factors,
including the number of IPOs the portfolio invests in, whether and to what
extent a security purchased in an IPO appreciates in value, and the asset base
of the portfolio. As a portfolio' s asset base increases, IPOs often have a
diminished effect on such portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
The portfolio, at times, may invest in derivatives, such as options and futures
contracts. The portfolio also may invest in foreign currencies and engage in
short-selling, which involves selling a security it does not own in anticipation
of a decline in the market price of the security. When employed, these practices
are used primarily to hedge the portfolio but may also be used to increase
returns; however, such practices sometimes may reduce returns or increase
volatility. In addition, derivatives can be illiquid and highly sensitive to
changes in their underlying instrument. A small investment in certain
derivatives could have a potentially large impact on the portfolio's
performance.
The portfolio can buy securities with borrowed money (a form of leverage), which
could magnify the portfolio's gains or losses.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 1.00% 1.00%
Rule 12b-1 fee none 0.25%
Other expenses 1.79% 1.79%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 2.79% 3.04%
Fee waiver and/or expense
reimbursement (1.29%) (1.54%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.50% 1.50%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.50%.
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $153 $743
SERVICE SHARES $153 $794
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only. The one-year number is based on the net
operating expenses. The three-year number is based on total annual portfolio
operating expenses.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 3>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 1.00% of the portfolio's average
daily net assets. For the fiscal period December 15, 1999 (commencement of
operations) through December 31, 1999, the portfolio did not pay Dreyfus a
management fee as a result of a fee waiver/expense reimbursement in effect.
Dreyfus is the primary mutual fund business of Mellon Financial Corporation, a
global financial services company with approximately $2.8 trillion of assets
under management, administration or custody, including approximately $540
billion under management. Mellon provides wealth management, global investment
services and a comprehensive array of banking services for individuals,
businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
Dreyfus has engaged its affiliate, Newton Capital Management Limited, to serve
as the portfolio's sub-investment adviser. Newton, located at 71 Queen Victoria
Street, London, EC4V 4DR, England, was formed in 1977 and, as of September 30,
2000, together with its parent and its parent' s subsidiaries, managed
approximately $30 billion in discretionary separate accounts and other
investment accounts.
The portfolio' s primary portfolio manager is Miki Sugimoto. She has been the
portfolio' s primary portfolio manager since the portfolio's inception and has
been employed by Newton since 1995. Prior to joining Newton, Ms. Sugimoto was
employed for five years at S.G. Warburg where she worked primarily in the
corporate finance department.
The portfolio, Dreyfus, Newton and Dreyfus Service Corporation (the portfolio's
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 4>
MANAGEMENT (CONTINUED)
Performance Information for Related Investment Accounts
The portfolio has a substantially similar investment objective and follows
substantially similar investment policies and strategies as two investment
accounts advised by Newton, the Newton Japan Fund and Newton Universal Growth
Funds Japanese Equity Fund (collectively, the "Investment Accounts"). The
portfolio currently has the same portfolio managers as the Investment Accounts.
The table at the right shows composite average annual total return information
for the Investment Accounts and for the Morgan Stanley Capital International
(MSCI) Japan Index, the benchmark index of the portfolio and the Investment
Accounts. No performance information is shown for the portfolio, which did not
have its own full year of performance as of September 30, 2000.
Investors should not consider this performance data as an indication of the
future performance of the portfolio. The performance figures for the Investment
Accounts were calculated by Micropal on a "bid-bid" basis (i.e., the price at
which an investor can sell its shares) with the accounts' gross income
reinvested in U.S. dollars. The performance figures were then adjusted to
reflect the deduction of the historical annual management fee paid by the
Investment Accounts (1.50% of each Investment Account's net assets), and not
those paid by the portfolio. The performance figures for the Investment Accounts
do not reflect the deduction of charges or expenses attributable to VA contracts
or VLI policies, which would lower the performance quoted. Policy owners should
refer to the applicable insurance company prospectus for information on any such
charges and expenses. Moreover, the performance of the Investment Accounts could
have been adversely affected by the imposition of certain regulatory
requirements, restrictions and limitations if the accounts had been regulated as
investment companies under the U.S. federal securities and tax laws.
Additionally, although it is anticipated that the portfolio and the Investment
Accounts will hold similar securities, their investment results are expected to
differ. In particular, differences in asset size and in cash flow resulting from
purchases and redemptions of portfolio shares may result in different security
selections, differences in the relative weightings of securities or differences
in the price paid for particular portfolio holdings.
Historical performance information for the Investment Accounts and for the MSCI
Japan Index for various periods ended September 30, 2000 is as follows:
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Average annual total return AS OF 9/30/00
Since
1 Year 5 Years 11/22/94*
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NEWTON JAPAN FUND -17.20% 7.70% 5.40%
NEWTON UGF JAPANESE
EQUITY FUND -15.20% 7.40% 4.40%
MSCI JAPAN INDEX** -2.00% -0.40% -1.49%
</TABLE>
* NEWTON BEGAN MANAGING THE INVESTMENT ACCOUNTS ON NOVEMBER 22, 1994. PRIOR
THERETO, THE INVESTMENT ACCOUNTS WERE MANAGED BY CAPITAL HOUSE, LLC,
A SUBSIDIARY OF THE ROYAL BANK OF SCOTLAND. PERFORMANCE FOR THE MSCI JAPAN
INDEX IS CALCULATED FROM OCTOBER 31, 1994.
** THE MSCI JAPAN INDEX IS A CAPITALIZATION-WEIGHTED INDEX (ADJUSTED IN U.S.
DOLLARS) OF COMPANIES IN JAPAN INTENDED TO REPLICATE THE INDUSTRY COMPOSITION
OF THE LOCAL MARKET. THE CHOSEN LIST OF STOCKS INCLUDES A REPRESENTATIVE
SAMPLING OF LARGE, MEDIUM AND SMALL-CAPITALIZATION WEIGHTED STOCKS, TAKING
EACH STOCK'S LIQUIDITY INTO ACCOUNT. THE RETURNS OF THE INDEX ASSUME
REINVESTMENT NET OF WITHHOLDING TAX AND, UNLIKE FUND RETURNS, DO NOT
REFLECT ANY FEES OR EXPENSES.
<Page 5>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
---------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 12.84 12.50
Investment operations: Investment income (loss) -- net (.06)(2) .00(3)
Net realized and unrealized gain (loss) on investments 2.21 .34
Total from investment operations 2.15 .34
Distributions: Dividends from investment income -- net (.05) --
Net asset value, end of period 14.94 12.84
Total return (%) 16.84(4) 2.64(4)
--------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .75(4) .07(4)
Ratio of net investment income (loss) to average net assets (%) (.41)(4) .03(4)
Decrease reflected in above expense ratios due to actions by Dreyfus (%)
1.11(4) 1.35(4)
Portfolio turnover rate (%) 222.29(4) --
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 2,486 2,054
(1) FROM DECEMBER 15, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) AMOUNT REPRESENTS LESS THAN $.01 PER SHARE.
(4) NOT ANNUALIZED.
</TABLE>
The Portfolio
<Page 7>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided the orders are received by the portfolio in
proper form on the next business day. The participating insurance company is
responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is with a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Japan Portfolio/share class), for
purchase of portfolio shares. The wire must include the portfolio account number
(for new accounts, a taxpayer identification number should be included instead)
and account registration and dealer number, if applicable, of the participating
insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees. Foreign securities held by the portfolio
may trade on days when the portfolio does not calculate its NAV and thus affect
the portfolio's NAV on days when investors have no access to the portfolio.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
<Page 8>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
Account Information
<Page 9>
For More Information
Dreyfus Investment Portfolios
Japan Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from:
http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
189P1200
Dreyfus Investment Portfolios
MidCap Stock Portfolio
Investing in stocks of medium-size companies for investment results that exceed
the total return performance of the S&P 400
PROSPECTUS December 31, 2000
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
MidCap Stock Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 6
Account Information
--------------------------------------------------------------------------------
Account Policies 7
Distributions and Taxes 7
Exchange Privilege 8
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks investment results that are greater than the total return
performance of publicly traded common stocks of medium-size domestic companies
in the aggregate, as represented by the Standard & Poor's MidCap 400((reg.tm))
Index (" S& P 400"). To pursue this goal, the portfolio invests primarily in a
blended portfolio of growth and value stocks of medium-size companies, those
whose market values generally range between $200 million and $10 billion. Stocks
are chosen through a disciplined process combining computer modeling techniques,
fundamental analysis and risk management. Consistency of returns and stability
of the portfolio's share price compared to the S&P 400 are primary goals of the
process. The portfolio's stock investments may include common stocks, preferred
stocks, convertible securities and depositary receipts.
Dreyfus uses a computer model to identify and rank stocks within an industry or
sector, based on:
. VALUE, or how a stock is priced relative to its
perceived intrinsic worth
. GROWTH, in this case the sustainability or
growth of earnings
. FINANCIAL PROFILE, which measures the financial
health of the company
Next, Dreyfus uses fundamental analysis to select the most attractive of the
top-ranked securities.
Dreyfus then manages risk by diversifying across companies and industries,
limiting the potential adverse impact from any one stock or industry. The
portfolio is structured so that its sector weightings and risk characteristics,
such as growth, size, quality and yield, are similar to those of the S&P 400.
Concepts to understand
MIDCAP COMPANIES: established companies that may not be well known. Midcap
companies have the potential to grow faster than large-cap companies, but may
lack the resources to weather economic shifts, and are more volatile than large
companies.
COMPUTER MODEL: a proprietary computer model that evaluates and ranks a universe
of over 2,000 stocks. Dreyfus reviews each of the screens on a regular basis.
Dreyfus also maintains the flexibility to adapt the screening criteria to
changes in market conditions.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
Medium-size companies carry additional risks because their earnings tend to be
less predictable, their share prices more volatile and their securities less
liquid than larger, more established companies. Some of the portfolio's
investments will rise and fall based on investor perception rather than
economics.
Although the portfolio seeks to manage risk by broadly diversifying among
industries and by maintaining a risk profile very similar to the S&P 400, the
portfolio is expected to hold fewer securities than the index. Owning fewer
securities and the ability to purchase stocks of companies not listed in the S&P
400 can cause the portfolio to underperform the index.
By investing in a mix of growth and value companies, the portfolio assumes the
risks of both and may achieve more modest gains than funds that use only one
investment style. Because the stock prices of growth companies are based in part
on future expectations, they may fall sharply if earnings expectations are not
met or investors believe the prospects for a stock, industry or the economy in
general are weak. Growth stocks also typically lack the dividend yield that
could cushion stock prices in market downturns. With value stocks, there is the
risk that they may never reach what the manager believes is their full market
value, or that their intrinsic values may fall. While investments in value
stocks may limit downside risk over time, they may produce smaller gains than
riskier stocks.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
The portfolio, at times, may invest some assets in derivatives, such as options
and futures contracts. These practices, when employed, are used to hedge the
portfolio and increase returns; however, such practices sometimes may reduce
returns or increase volatility. Derivatives can be illiquid, and a small
investment in certain derivatives could have a potentially large impact on the
portfolio's performance.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the
portfolio. The bar chart shows the performance of the portfolio's Initial shares
for the portfolio's first full calendar year of operations. The table compares
the average annual total return of the Initial shares to that of the S&P 400, a
broad measure of midcap stock performance. All performance figures reflect the
reinvestment of dividends and distributions. Of course, past performance is no
guarantee of future results. As a new class, past performance information is not
available for Service shares as of the date of this prospectus.
--------------------------------------------------------------------------------
Year-by-year total return AS OF 12/31 EACH YEAR (%)
10.82
90 91 92 93 94 95 96 97 98 99
INITIAL SHARES
BEST QUARTER: Q4 '99 +14.67%
WORST QUARTER: Q3 '99 -7.11%
--------------------------------------------------------------------------------
Average annual total return AS OF 12/31/99
Since
inception
1 Year (5/1/98)
--------------------------------------------------------------------------------
INITIAL SHARES 10.82% 4.72%
S&P 400 14.72% 12.02%*
* FOR COMPARATIVE PURPOSES, THE VALUE OF THE INDEX ON 4/30/98 IS USED AS THE
BEGINNING VALUE ON 5/1/98.
Additional costs
Performance information reflects the portfolio's expenses only and does not
reflect the fees and charges imposed by participating insurance companies under
their VA contracts or VLI policies. Because these fees and charges will reduce
total return, VA contract holders and VLI policyholders should consider them
when evaluating and comparing the portfolio's performance. VA contract holders
and VLI policyholders should consult the prospectus for their contract or policy
for more information.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price. As
with the performance information given previously, these figures do not reflect
any fees or charges imposed by participating insurance companies under their VA
contracts or VLI policies.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.75% 0.75%
Rule 12b-1 fee none 0.25%
Other expenses 0.71% 0.71%
--------------------------------------------------------------------------------
TOTAL ANNUAL PORTFOLIO
OPERATING EXPENSES 1.46% 1.71%
Fee waiver and/or expense
reimbursement (0.46%) (0.71%)
--------------------------------------------------------------------------------
NET OPERATING EXPENSES* 1.00% 1.00%
*THE DREYFUS CORPORATION HAS AGREED, UNTIL DECEMBER 31, 2001, TO WAIVE RECEIPT
OF ITS FEES AND/OR ASSUME THE EXPENSES OF THE PORTFOLIO SO THAT THE EXPENSES OF
NEITHER CLASS (EXCLUDING TAXES, BROKERAGE COMMISSIONS, EXTRAORDINARY EXPENSES,
INTEREST EXPENSES AND COMMITMENT FEES ON BORROWINGS) EXCEED 1.00%. FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1999, DREYFUS FURTHER REIMBURSED THE PORTFOLIO
FOR OTHER EXPENSES SO THAT TOTAL ANNUAL PORTFOLIO OPERATING EXPENSES FOR INITIAL
SHARES WERE 0.97% INSTEAD OF 1.00%. (SERVICE SHARES WERE NOT IN EXISTENCE DURING
THE FISCAL YEAR ENDED DECEMBER 31, 1999.) THIS ADDITIONAL EXPENSE REIMBURSEMENT
WAS VOLUNTARY.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INITIAL SHARES $102 $417 $754 $1,707
SERVICE SHARES $102 $469 $862 $1,960
This example shows what an investor could pay in expenses over time. It uses
the same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be
different, the example is for comparison only. The one-year number is based on
the net operating expenses. The longer-term numbers are based on total annual
portfolio operating expenses.
</TABLE>
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: fees paid by the portfolio for miscellaneous items such as
transfer agency, custody, professional and registration fees. Other expenses for
Service shares are based on other expenses for Initial shares for the past
fiscal year.
<Page 4>
MANAGEMENT
The investment adviser for the fund is The Dreyfus Corporation, 200 Park Avenue,
New York, New York 10166. Founded in 1947, Dreyfus manages more than $154
billion in over 190 mutual fund portfolios. For the past fiscal year, the
portfolio paid Dreyfus a management fee at the annual rate of 0.29% of the
portfolio' s average daily net assets. Dreyfus is the primary mutual fund
business of Mellon Financial Corporation, a global financial services company
with approximately $2.8 trillion of assets under management, administration or
custody, including approximately $540 billion under management. Mellon provides
wealth management, global investment services and a comprehensive array of
banking services for individuals, businesses and institutions. Mellon is
headquartered in Pittsburgh, Pennsylvania.
John O' Toole is the portfolio's primary portfolio manager, a position he has
held since the portfolio' s inception. He has been employed by Dreyfus since
October 1994. Mr. O' Toole also is a senior vice president and a portfolio
manager for Mellon Equity Associates, an affiliate of Dreyfus, and has been
employed by Mellon Bank, N.A. since 1979.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund.
The Portfolio
<Page 5>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
INITIAL SHARES 2000 1999 1998(1)
---------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C> <C>
Net asset value, beginning of period 13.44 12.16 12.50
Investment operations: Investment income -- net .03(2) .03(2) .02
Net realized and unrealized gain (loss) on investments .86 1.28 (.34)
Total from investment operations .89 1.31 (.32)
Distributions: Dividends from investment income -- net .00(3) (.03) (.02)
Net asset value, end of period 14.33 13.44 12.16
Total return (%) 6.63(4) 10.82 (2.53)(4)
----------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .50(4) .97 .67(4)
Ratio of net investment income to average net assets (%) .20(4) .26 .18(4)
Decrease reflected in above expense ratios due to actions by Dreyfus (%) .07(4) .49 .60(4)
Portfolio turnover rate (%) 52.16(4) 77.73 75.74(4)
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 32,187 15,563 10,506
(1) FROM MAY 1, 1998 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1998.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) AMOUNT REPRESENTS LESS THAN $.01 PER SHARE.
(4) NOT ANNUALIZED.
</TABLE>
<Page 6>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
PORTFOLIO SHARES MAY BE PURCHASED or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
THE PRICE FOR PORTFOLIO SHARES is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders.
WIRE PURCHASE PAYMENTS MAY BE MADE if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: MIDCAP STOCK PORTFOLIO/ SHARE
CLASS) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead), account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
THE PORTFOLIO USUALLY PAYS DIVIDENDS from its net investment income and
distributes any net capital gains it has realized once a year.
EACH SHARE CLASS WILL GENERATE a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
Account Information
<Page 7>
EXCHANGE PRIVILEGE
SHAREHOLDERS CAN EXCHANGE SHARES of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
<Page 8>
NOTES
For More Information
Dreyfus Investment Portfolios
MidCap Stock Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
174P1200
Dreyfus Investment Portfolios
Technology Growth Portfolio
Investing in technology companies for capital appreciation
PROSPECTUS December 31, 2000
(reg.tm)
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The Portfolio
Dreyfus Investment Portfolios
Technology Growth Portfolio
Contents
The Portfolio
--------------------------------------------------------------------------------
Goal/Approach 1
Main Risks 2
Past Performance 3
Expenses 4
Management 5
Financial Highlights 6
Account Information
--------------------------------------------------------------------------------
Account Policies 7
Distributions and Taxes 7
Exchange Privilege 8
For More Information
--------------------------------------------------------------------------------
INFORMATION ON THE PORTFOLIO'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN
THE CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
Portfolio shares are offered only to separate accounts established by insurance
companies to fund variable annuity contracts ("VA contracts") and variable life
insurance policies (" VLI policies" ). Individuals may not purchase shares
directly from, or place sell orders directly with, the portfolio. The VA
contracts and the VLI policies are described in the separate prospectuses issued
by the participating insurance companies, as to which the portfolio assumes no
responsibility. Conflicts may arise between the interests of VA contract holders
and VLI policyholders. The board of trustees will monitor events to identify any
material conflicts and, if such conflicts arise, determine what action, if any,
should be taken.
The portfolio currently offers two classes of shares: Initial shares and Service
shares. VA contract holders and VLI policyholders should consult the applicable
prospectus of the separate account of the participating insurance company to
determine which class of portfolio shares may be purchased by the separate
account.
While the portfolio's investment objective and policies may be similar to those
of other funds managed by the investment adviser, the portfolio's investment
results may be higher or lower than, and may not be comparable to, those of the
other funds.
GOAL/APPROACH
The portfolio seeks capital appreciation. To pursue this goal, the portfolio
invests primarily in the stocks of growth companies of any size that Dreyfus
believes to be leading producers or beneficiaries of technological innovation.
Up to 25% of the portfolio's assets may be invested in foreign securities. The
portfolio' s stock investments may include common stocks, preferred stocks and
convertible securities.
In choosing stocks, the portfolio looks for sectors in technology that are
expected to outperform on a relative scale. The more attractive sectors are
overweighted; those sectors with less appealing prospects are underweighted.
Among the sectors evaluated are those that develop, produce or distribute
products or services in the computer, semi-conductor, electronics,
communications, healthcare, biotechnology, computer software and hardware,
electronic components and systems, network and cable broadcasting,
telecommunications, defense and aerospace, and environmental sectors.
Although the portfolio looks for companies with the potential for strong
earnings growth rates, some of the portfolio's investments may currently be
experiencing losses. Moreover, the portfolio may invest in small-, mid- and
large-cap securities in all available trading markets, including initial public
offerings (IPOs) and the aftermarket.
Concepts to understand
SMALL AND MIDSIZE COMPANIES: new and often entrepreneurial companies. These
companies tend to grow faster than large-cap companies and typically use any
profits for expansion rather than for paying dividends. They are also more
volatile than larger companies and fail more often.
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings,
price-to-book and price-to-sales ratios, and tend to be more volatile than value
stocks.
The Portfolio
<Page 1>
MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. In fact, the technology sector has been among the
most volatile sectors of the stock market. The value of a shareholder's
investment in the portfolio will go up and down, sometimes dramatically, which
means that shareholders could lose money.
Technology companies, especially small-cap technology companies, involve greater
risk because their earnings tend to be less predictable, their share prices more
volatile and their securities less liquid than larger, more established
companies. Some of the portfolio's investments in technology companies will rise
and fall based on investor perception rather than economics. Other portfolio
investments are made in anticipation of future products and services which, if
delayed or cancelled, could cause the stock price to drop dramatically.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately,
even if earnings do increase. In addition, growth stocks typically lack the
dividend yield that can cushion stock prices in market downturns.
Any foreign securities purchased by the portfolio include special risks, such as
exposure to currency fluctuations, changing political climate, lack of
comprehensive company information and potentially less liquidity.
The portfolio may purchase securities of companies in IPOs. The prices of
securities purchased in IPOs can be very volatile. The effect of IPOs on the
portfolio's performance depends on a variety of factors, including the number of
IPOs the portfolio invests in, whether and to what extent a security purchased
in an IPO appreciates in value, and the asset base of the portfolio. As a
portfolio' s asset base increases, IPOs often have a diminished effect on such
portfolio's performance.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could reduce the benefit from any upswing in the market. During such
periods, the portfolio may not achieve its investment objective.
Other potential risks
The portfolio, at times, may invest in derivatives, such as options and futures
contracts. The portfolio also may invest in foreign currencies and engage in
short-selling, which involves selling a security it does not own in anticipation
of a decline in the market price of the security. These practices, when
employed, are used primarily to hedge its portfolio but also may be used to
increase returns; however, such practices sometimes may reduce returns or
increase volatility. In addition, derivatives can be illiquid and highly
sensitive to changes in their underlying instrument. A small investment in
certain derivatives could have a potentially large impact on the portfolio's
performance.
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
What the portfolio is -- and isn't
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives shareholders the opportunity to participate in financial
markets. It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
<Page 2>
PAST PERFORMANCE
Since Initial shares had less than one calendar year of performance as of
December 31, 1999, annual total return information for that class is not
included in this section of the prospectus. As a new class, past performance
information is not available for Service shares as of the date of this
prospectus.
The Portfolio
<Page 3>
EXPENSES
Investors using this portfolio to fund a VA contract or a VLI policy will pay
certain fees and expenses in connection with the portfolio, which are described
in the table below. Annual portfolio operating expenses are paid out of
portfolio assets, so their effect is included in the portfolio's share price.
These figures do not reflect any fees or charges imposed by participating
insurance companies under their VA contracts or VLI policies. Owners of VA
contracts or VLI policies should refer to the applicable insurance company
prospectus for information on those fees or charges.
--------------------------------------------------------------------------------
Fee table
Initial Service
shares shares
--------------------------------------------------------------------------------
ANNUAL PORTFOLIO OPERATING EXPENSES
% OF AVERAGE DAILY NET ASSETS
Management fees 0.75% 0.75%
Rule 12b-1 fee none 0.25%
Other expenses 0.04% 0.04%
--------------------------------------------------------------------------------
TOTAL 0.79% 1.04%
--------------------------------------------------------------------------------
Expense example
1 Year 3 Years
--------------------------------------------------------------------------------
INITIAL SHARES $81 $252
SERVICE SHARES $106 $331
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual return and expenses will be different,
the example is for comparison only.
Concepts to understand
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
RULE 12B-1 FEE: the fee paid to the portfolio's distributor for distributing
Service shares, for advertising and marketing related to Service shares, and for
providing account service and maintenance for holders of Service shares. The
distributor may pay all or part of this fee to participating insurance
companies, and the broker-dealer acting as principal underwriter for their
variable insurance products. Because this fee is paid on an ongoing basis out of
portfolio assets attributable to Service shares, over time it will increase the
cost of an investment in Service shares which could be more than that payable
with respect to other types of sales charges.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<Page 4>
MANAGEMENT
The investment adviser for the portfolio is The Dreyfus Corporation, 200 Park
Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages more than
$154 billion in over 190 mutual fund portfolios. The portfolio has agreed to pay
Dreyfus a management fee at the annual rate of 0.75% of the portfolio's average
daily net assets. For the fiscal period August 31, 1999 (commencement of
operations) through December 31, 1999, Dreyfus waived or reimbursed a portion of
its management fee so that the net fee paid by the portfolio was 0.49%. Dreyfus
is the primary mutual fund business of Mellon Financial Corporation, a global
financial services company with approximately $2.8 trillion of assets under
management, administration or custody, including approximately $540 billion
under management. Mellon provides wealth management, global investment services
and a comprehensive array of banking services for individuals, businesses and
institutions. Mellon is headquartered in Pittsburgh, Pennsylvania.
The portfolio's primary portfolio manager is Mark Herskovitz. Mr. Herskovitz has
been the primary portfolio manager of the portfolio since its inception and has
been employed by Dreyfus since 1996. From 1992 to 1996, he served as a senior
technology analyst at National City Bank.
The portfolio, Dreyfus and Dreyfus Service Corporation (the portfolio' s
distributor) each has adopted a code of ethics that permits its personnel,
subject to such code, to invest in securities, including securities that may be
purchased or held by the portfolio. The Dreyfus code of ethics restricts the
personal securities transactions of its employees, and requires portfolio
managers and other investment personnel to comply with the code's preclearance
and disclosure procedures. Its primary purpose is to ensure that personal
trading by Dreyfus employees does not disadvantage any Dreyfus-managed fund
The Portfolio
<Page 5>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance of the portfolio's Initial shares
for the fiscal periods indicated. Certain information reflects financial results
for a single portfolio share. "Total return" shows how much an investment in the
portfolio would have increased (or decreased) during each period, assuming the
investor had reinvested all dividends and distributions. These figures (other
than those for the six-month period ended June 30, 2000) have been independently
audited by Ernst & Young LLP, whose report, along with the portfolio's financial
statements, is included in the annual report, which is available upon request.
Keep in mind that fees and charges imposed by participating insurance companies,
which are not reflected in the table, would reduce the investment returns that
are shown. Since Service shares are new, financial highlights information is not
available for that class as of the date of this prospectus.
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31
INITIAL SHARES 2000 1999(1)
------------------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
<S> <C> <C>
Net asset value, beginning of period 19.45 12.50
Investment operations: Investment (loss) -- net (.04)(2) (.02)(2)
Net realized and unrealized gain (loss) on investments 2.59 6.97
Total from investment operations 2.55 6.95
Distributions: Dividends from net realized gain on investments (.02) --
Net asset value, end of period 21.98 19.45
Total return (%) 13.10(3) 55.60(3)
--------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .43(3) .36(3)
Ratio of net investment income (loss) to average net assets (%) (.19)(3) (.14)
(3)
Decrease reflected in above expense ratios due to actions by Dreyfus (%)
-- .09(3)
Portfolio turnover rate (%) 65.98(3) 20.01(3)
---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period ($ x 1,000) 168,673 65,707
(1) FROM AUGUST 31, 1999 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1999.
(2) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(3) NOT ANNUALIZED.
</TABLE>
<Page 6>
Account Information
ACCOUNT POLICIES
Buying/Selling shares
Portfolio shares may be purchased or sold (redeemed) by separate accounts of
participating insurance companies. VA contract holders and VLI policyholders
should consult the prospectus of the separate account of the participating
insurance company for more information about buying or selling portfolio shares
The price for portfolio shares is the net asset value per share (NAV) of the
relevant class, which is generally calculated as of the close of trading on the
New York Stock Exchange (usually 4:00 p.m. Eastern time) every day the exchange
is open. Purchase and sale orders from separate accounts received in proper form
by the participating insurance company on a given business day are priced at the
NAV calculated on such day, provided that the orders are received by the
portfolio in proper form on the next business day. The participating insurance
company is responsible for properly transmitting purchase and sale orders.
Wire purchase payments may be made if the bank account of the participating
insurance company is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/Dreyfus Investment Portfolios: Technology Growth Portfolio/share
class) , for purchase of portfolio shares. The wire must include the portfolio
account number (for new accounts, a taxpayer identification number should be
included instead), account registration and dealer number, if applicable, of the
participating insurance company.
The portfolio's investments are generally valued based on market value or, where
market quotations are not readily available, based on fair value as determined
in good faith by the board of trustees.
DISTRIBUTIONS AND TAXES
The portfolio usually pays dividends from its net investment income and
distributes any net capital gains it has realized once a year.
Each share class will generate a different dividend because each has different
expenses. Distributions will be reinvested in the portfolio unless the
participating insurance company instructs otherwise.
Since the portfolio's shareholders are the participating insurance companies and
their separate accounts, the tax treatment of dividends and distributions will
depend on the tax status of the participating insurance company. Accordingly, no
discussion is included as to the federal income tax consequences to VA contract
holders or VLI policyholders. For this information, VA contract holders and VLI
policyholders should consult the prospectus of the separate account of the
participating insurance company or their tax advisers.
Participating insurance companies should consult their tax advisers about
federal, state and local tax consequences.
Who the shareholders are
The participating insurance companies and their separate accounts are the
shareholders of the portfolio. From time to time, a shareholder may own a
substantial number of portfolio shares. The sale of a large number of shares
could hurt the portfolio's NAV.
Account Information
<Page 7>
EXCHANGE PRIVILEGE
Shareholders can exchange shares of a class of the portfolio for shares of the
same class of any other portfolio or fund managed by Dreyfus that is offered
only to separate accounts established by insurance companies to fund VA
contracts and VLI policies, or for shares of any such portfolio or fund offered
without a separate class designation, or which makes available only one class,
subject to the terms and conditions relating to exchanges of the applicable
insurance company prospectus. Owners of VA contracts or VLI policies should
refer to the applicable insurance company prospectus for more information on
exchanging portfolio shares.
<Page 8>
NOTES
For More Information
Dreyfus Investment Portfolios
Technology Growth Portfolio
----------------------------------------
SEC file number: 811-08673
More information on the portfolio is available free upon request, including the
following:
Annual/Semiannual Report
Describes the portfolio's performance, lists portfolio holdings and contains a
letter from the portfolio manager discussing recent market conditions, economic
trends and portfolio strategies that significantly affected the portfolio's
performance during the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the portfolio and its policies. A current SAI is on
file with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call 1-800-554-4611 or 516-338-3300
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144 Attn: Institutional Servicing
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies, after paying a duplicating fee, by visiting the
SEC's Public Reference Room in Washington, DC (for information, call
1-202-942-8090) or by E-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
175P1200
