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EATON VANCE BALANCED FUND
Supplement to Prospectus
Dated May 1, 1999
1. THE FOLLOWING REPLACES THE THIRD PARAGRAPH ON PAGE 2 OF THE PROSPECTUS:
The Fund currently seeks its objective by investing in Capital Growth
Portfolio and Investment Grade Income Portfolio, separate registered
investment companies. The investment objective of Capital Growth Portfolio
is to seek growth of capital and the investment objectives of Investment
Grade Income Portfolio are to provide current income and total return.
2. THE FOLLOWING REPLACES THE "ANNUAL FUND OPERATING EXPENSES" TABLE AND
"EXAMPLE" UNDER "FUND SUMMARY" ON PAGE 3 OF THE PROSPECTUS:
<TABLE>
<CAPTION>
Annual Fund Operating Expenses (expenses that are deducted from Fund assets) Class A Class B Class C
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.61% 0.61% 0.61%
Distribution and Service (12b-1) Fees* 0.00% 0.94% 1.00%
Other Expenses** 0.36% 0.23% 0.23%
---- ---- ----
Total Annual Fund Operating Expenses 0.97% 1.78% 1.84%
</TABLE>
* Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end sales charge permitted by the National
Association of Securities Dealers, Inc.
** Other Expenses for Class A shares includes a service fee of 0.13%.
Example. This Example is intended to help you compare the cost of investing
in the Fund with the cost of investing in other mutual funds. The Example
assumes that you invest $10,000 in the Fund for the time periods indicated
and then redeem all of your shares at the end of those periods. The Example
also assumes that your investment has a 5% return each year and that the
operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
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Class A shares $668 $866 $1,080 $1,696
Class B shares $681 $960 $1,164 $2,095
Class C shares $287 $579 $ 995 $2,159
You would pay the following expenses if you did not redeem you shares:
1 Year 3 Years 5 Years 10 Years
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Class A shares $668 $866 $1,080 $1,696
Class B shares $181 $560 $ 964 $2,095
Class C shares $187 $579 $ 995 $2,159
3. THE FOLLOWING REPLACES THE FIRST AND SECOND PARAGRAPH UNDER "INVESTMENT
OBJECTIVES & PRINCIPAL POLICIES AND RISKS" ON PAGE 10 OF THE PROSPECTUS:
The investment objectives and principal policies and risks of the Funds are
set forth below. Each Fund's investment objective may not be changed
without shareholder approval. Certain of a Fund's investment policies may
be changed by the Trustees without shareholder approval. Each Fund
currently seeks its investment objective by investing in one or more
separate open-end investment companies that have the same objective and
policies as the Fund.
BALANCED FUND. Balanced Fund's investment objective is to provide current
income and long-term capital growth. The Fund currently invests in Capital
Growth Portfolio and Investment Grade Income Portfolio. The investment
objective of Capital Growth Portfolio is to seek growth of capital and the
investment objectives of Investment Grade Income Portfolio are to seek
current income and total return.
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The Balanced Fund's allocation of assets to equity securities in the
Capital Growth Portfolio will generally not exceed 75% nor be less than 25%
of net assets. The Capital Growth Portfolio invests in a broadly
diversified list of seasoned securities representing a number of different
industries. The portfolio manager places emphasis on equity securities
considered to be of high or improving quality. The foregoing policies
cannot be changed without shareholder approval. Balanced Fund also
allocates at least 25% of its net assets in fixed-income securities in the
Investment Grade Income Portfolio, which may include preferred stocks,
corporate bonds, U.S. Government securities, money market instruments and
mortgage-backed obligations. The Investment Grade Income Portfolio may
invest in fixed-income securities of any credit quality but will limit
investment in fixed-income securities rated below investment grade to not
more than 5% of the Balanced Fund's total assets.
4. THE FOLLOWING REPLACES THE SECOND PARAGRAPH UNDER "MANAGEMENT AND
ORGANIZATION" ON PAGE 12 OF THE PROSPECTUS:
The investment adviser manages the investments of each Portfolio and
provides related office facilities and personnel. Under its investment
advisory agreements with Capital Growth Portfolio and Investment Grade
Income Portfolio, BMR receives a monthly advisory fee from Capital Growth
Portfolio of 5/96 of 1% (equivalent to 0.625% annually) of the average
daily net assets up to and including $170 million, and 1/24 of 1%
(equivalent to 0.50% annually) of the average daily net assets over $170
million, and a monthly advisory fee from Investment Grade Income Portfolio
of 5/ 96 of 1% (equivalent to 0.625% annually) of the average daily net
assets up to and including $130 million, and 1/24 of 1% (equivalent to
0.50% annually) of the average daily net assets over $130 million.
5. THE FOLLOWING REPLACES THE FIFTH PARAGRAPH UNDER "MANAGEMENT AND
ORGANIZATION" ON PAGE 12 OF THE PROSPECTUS:
Arieh Coll is the portfolio manager of the Capital Growth Portfolio (since
it commenced operations). He has been an Eaton Vance portfolio manager
since January 2000 and is Vice President of Eaton Vance and BMR. Prior to
joining Eaton Vance, Mr. Coll was employed by Fidelity Investments as a
portfolio manager. Michael B. Terry is the portfolio manager of Investment
Grade Income Portfolio (since it commenced operations). He also manages
other Eaton Vance portfolios, has been an Eaton Vance portfolio manager for
more than 5 years, and is a Vice President of Eaton Vance and BMR.
MARCH 6, 2000 BALPS
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