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WM GROUP OF FUNDS
1201 THIRD AVENUE, 22ND FLOOR
SEATTLE, WASHINGTON 98101
SUPPLEMENT DATED JUNE 22, 1999 TO
PROSPECTUS DATED MARCH 1, 1999, AS REVISED MAY 19, 1999
1. International Growth Fund.
Subject to shareholder approval, it is expected that effective on or about
June 23, 1999, Capital Guardian Trust Company ("Capital Guardian") will assume
sub-advisory responsibility for the International Growth Fund.
Capital Guardian is wholly-owned by Capital Group International, Inc. which
itself is wholly-owned by the Capital Group Companies, Inc. ("Capital Group").
Capital Guardian employs a team of portfolio managers each of whom can be
considered to have primary responsibility for the day-to-day management of the
portion of the Fund assigned to him or her. They are: David I. Fisher, Harmut
Giesecke, Richard N. Havas, Nancy J. Kyle, John McIlwraith, Robert Ronus, Lionel
M. Sauvage, Nilly Sikorsky and Rudolf M. Staehelin. Mr. Fisher is Chairman of
the Board of Capital Group International, Inc. and Capital Guardian as well as
Vice Chairman of Capital International, Inc., Emerging Markets Growth Fund, Inc.
and also a director of the Capital Group Companies, Inc. He has been employed by
the Capital Group organization for 29 years. Mr. Giesecke is Chairman of the
Board of Capital Group's Japanese investment management subsidiary, Capital
International K.K., and Managing Director, Asia-Pacific, Capital Group
International, Inc. Mr. Giesecke, who has been with the Capital Group
organization for 26 years, is also a Senior Vice President and a Director of
Capital International, Inc. as well as a Senior Vice President of Capital
International Research, Inc. and a Vice President of Emerging Markets Growth
Fund. Mr. Havas, who has been with the Capital Group organization for 13 years,
is a Senior Vice President and portfolio manager for Capital Guardian and
Capital International Limited as well as a Senior Vice President and Director of
Capital Guardian (Canada), Inc. Ms. Kyle, who has been with the Capital Group
organization for 8 years, is a Senior Vice President and Director of Capital
Guardian. Ms. Kyle is also President and a Director of Capital Guardian
(Canada), Inc. and a Vice President of Emerging Markets Growth Fund. Mr.
McIlwraith is a Senior Vice President and a Director of Capital Guardian as well
as a Director and Senior Vice President of Capital International Limited. Mr.
McIlwraith is also an international equity portfolio manager and has been with
the Capital Group organization for 15 years. Mr. Ronus is President and a
Director of Capital Guardian, as well as Chairman of the Board of Directors of
Capital Guardian (Canada), Inc., a Director of the Capital Group and Capital
Group International, Inc., and a Senior Vice President of Capital International
S.A. and Capital International Limited. Mr. Ronus has been employed by the
Capital Group organization for 26 years. Mr. Sauvage is a Senior Vice President
and portfolio manager for Capital Guardian and a Vice President for Capital
International Research, Inc. Mr. Sauvage has been employed by the Capital Group
organization for 12 years. Ms. Sikorsky is President and Managing Director of
Capital International S.A., Chairman of Capital International Perspective, S.A.,
Managing Director-Europe and a Director of Capital Group International, Inc., as
well as serving as a Director of the Capital Group, Capital International
Limited and Capital International K.K. Ms. Sikorsky has been employed by the
Capital Group organization for 36 years. Mr. Staehelin is a Senior Vice
President and Director of Capital International Research, Inc. and Capital
International S.A., and has been employed by the Capital Group organization for
17 years.
In selecting investments for the International Growth Fund, Capital Guardian
seeks to identify foreign stocks that it believes have an attractive valuation,
high return on invested capital, excellent cash flow, strong balance sheets and
strong management. Capital Guardian utilizes a research- driven "bottom-up"
approach, in that decisions are made based upon extensive field research and
direct company contact. Capital Guardian blends its basic value-oriented
approach with macroeconomic and political judgments on the outlook for
economies, industries, currencies and markets.
2. Tax-Exempt Money Market and California Money Funds
Effective on or about September 1, 1999, Class B shares of the Tax-Exempt
Money Market and the California Money Funds will no longer be available for
purchase, either directly or by exchange.
PLEASE RETAIN THIS SUPPLEMENT WITH THE
PROSPECTUS FOR FUTURE REFERENCE.
(over)
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3. WM Strategic Asset Management Portfolios.
Subject to shareholder approval, it is expected that effective on or about
July 16, 1999, the Strategic Growth Portfolio, Conservative Growth Portfolio,
Balanced Portfolio, Flexible Income Portfolio, and Income Portfolio, the five
initial series of WM Strategic Asset Management Portfolios, LLC, a
Massachusetts limited liability company (the "LLC"), will succeed to all of
the assets, rights, obligations and liabilities of the Strategic Growth
Portfolio, Conservative Growth Portfolio, Balanced Portfolio, Flexible Income
Portfolio, and Income Portfolio series of shares of WM Strategic Asset
Management Portfolios, a Massachusetts business trust (the "Trust"),
respectively. Thereafter, the financial highlights and performance information
contained in the Prospectus for WM Strategic Asset Management Portfolios will
continue to relate to the Trust, as the predecessor of the LLC, while all
other information in the prospectus about WM Strategic Asset Management
Portfolios will relate to the LLC.
The following unaudited financial information supplements the information
appearing in the Prospectus under the heading "Financial Highlights." The
unaudited financial statements for each series of the Trust for the six months
ended April 30, 1999 are included in the Semi-Annual Report to Shareholders
for that period, which is available upon request.
FINANCIAL HIGHLIGHTS*
For a share outstanding during the six-month period ended April 30, 1999.
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<CAPTION>
STRATEGIC CONSERVATIVE
GROWTH GROWTH BALANCED FLEXIBLE INCOME INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------------- ---------------------- -------------------- -------------------- --------------------
CLASS A CLASS B CLASS A CLASS B CLASS A CLASS B CLASS A CLASS B CLASS A CLASS B
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period $11.67 $11.52 $10.97 $10.85 $11.02 $11.02 $10.63 $10.63 $10.25 $10.25
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
INCOME FROM INVESTMENT OPERATIONS:
Net Investment
Income/(Loss) $ 0.01++ $(0.03)++ $ 0.05++ $ 0.00++# $ 0.11++ $ 0.07++ $ 0.19++ $ 0.15++ $ 0.28 $ 0.25
Net Realized &
Unrealized
Gain/(Loss) on
Investments 3.46 3.41 2.94 2.91 1.98 1.99 0.70 0.70 (0.02) (0.03)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From
Investment
Operations $ 3.47 $ 3.38 $ 2.99 $ 2.91 $ 2.09 $ 2.06 $ 0.89 $ 0.85 $ 0.26 $ 0.22
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
LESS DISTRIBUTIONS:
Dividends from
Net Investment
Income $(0.01) $ -- $(0.18) $(0.10) $(0.22) $(0.19) $(0.25) $(0.21) $(0.29) $(0.25)
Distributions
In Excess of
Net Investment
Income (0.40) (0.32) (0.24) (0.24) (0.14) (0.14) (0.02) (0.02) (0.01) (0.01)
Distributions
from Net
Realized
Capital Gains (0.80) (0.80) (0.74) (0.74) (0.67) (0.67) (0.29) (0.29) (0.02) (0.02)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total
Distributions $(1.21) $(1.12) $(1.16) $(1.08) $(1.03) $(1.00) $(0.56) $(0.52) $(0.32) $(0.28)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net Asset Value,
End of Period $13.93 $13.78 $12.80 $12.68 $12.08 $12.08 $10.96 $10.96 $10.19 $10.19
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return+ 31.45% 31.01% 28.80% 28.33% 20.05% 19.71% 8.68% 8.30% 2.50% 2.12%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End
of Period
(in 000's) $33,176 $89,988 $128,413 $206,683 $114,570 $158,170 $11,949 $27,643 $7,983 $11,446
Ratio of
Operating
Expenses to
Average Net
Assets(a) 1.06%** 1.81%** 1.00%** 1.75%** 1.01%** 1.76%** 0.98%** 1.72%** 0.99%** 1.74%**
Ratio of Net
Investment
Income/
(Loss) to
Average Net
Assets 0.22%** (.53)%** 0.83%** 0.08%** 1.91%** 1.16%** 3.57%** 2.83%** 5.59%** 4.84%**
Portfolio
Turnover
Rate 19% 19% 13% 13% 35% 35% 30% 30% 29% 29%
Ratio or
Operating
Expenses to
Average Net
Assets
Without Fee
Waivers,
Expenses
Reimbursed
and/or Fees
Reduced by
Credits
Allowed by the
Custodian(a) 1.11%** 1.86%** 1.04%** 1.79%** 1.04%** 1.79%** 1.21%** 1.95%** 1.32%** 2.07%**
* Financial information is unaudited.
** Annualized.
# Amount represents less than $0.01 per share.
+ Total return is not annualized for periods less than one year and does not reflect any applicable sales charges. The total
return would have been lower if certain fees had not been waived and expenses reimbursed by the investment advisor or if fees
had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
(a) Ratio of operating expenses to average net assets includes expenses paid indirectly, but does not include each Portfolio's
prorated share of expenses of the Underlying Funds.
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