PROSPECTUS
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THE | 75 Maiden Lane
ALGER | New York, New York 10038
FUND | (800) 992-FUND (992-3863)
ALGER MONEY MARKET PORTFOLIO
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The Alger Fund (the "Fund") is a registered investment company--a mutual
fund--that presently offers interest in six portfolios. This Prospectus sets
forth information about the Alger Money Market Portfolio (the "Portfolio"). The
Portfolio seeks high current income consistent with preservation of principal
and maintenance of liquidity.
Shares of the Portfolio are neither insured nor guaranteed by the U.S.
Government and there is no assurance that the Portfolio will be able to maintain
a stable net asset value of $1.00 per share.
Shares of the Portfolio are not deposits or obligations of, or guaranteed
or endorsed by any bank, and the shares are not federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other agency.
This Prospectus, which should be retained for future reference, contains
important information that you should know before investing. A Statement of
Additional Information dated April 18, 1995 containing further information about
all the portfolios of the Fund, including the Portfolio, has been filed with the
Securities and Exchange Commission and is incorporated by reference into this
Prospectus. It is available at no charge by contacting the Fund at the address
or phone number above.
FRED ALGER | FRED ALGER |
MANAGEMENT, | Investment Manager & COMPANY, | Distributor
INC. | INCORPORATED |
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURI-
TIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE
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APRIL 18, 1995
AS SUPPLEMENTED SEPTEMBER 18, 1995
<PAGE>
TABLE OF CONTENTS
Page
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Portfolio Expenses..................................................... iii
Financial Highlights................................................... iv
How to Buy Shares...................................................... 1
Special Investor Services.............................................. 1
How to Sell Shares..................................................... 2
How to Exchange Shares................................................. 3
Investment Objective and Policies...................................... 3
Investment Practices................................................... 4
Management of the Fund................................................. 5
Net Asset Value........................................................ 6
Contingent Deferred Sales Charge....................................... 6
Dividends and Taxes.................................................... 6
Performance............................................................ 7
ii
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PORTFOLIO EXPENSES
The Table below is designed to assist you in understanding the direct and
indirect costs and expenses that you will bear as a shareholder. The Example
accompanying the Table shows the amount of expenses you would pay on a $1,000
investment in the Portfolio. These amounts assume the reinvestment of all
dividends and distributions, payment of any applicable contingent deferred sales
charge and payment by the Portfolio of operating expenses as shown in the Table
under Annual Portfolio Operating Expenses. The Example is an illustration only
and actual expenses may be greater or less than those shown.
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases.......................... None
Maximum Sales Load Imposed on Reinvested Dividends............... None
Maximum Contingent Deferred Sales Charge (as a percentage
of redemption proceeds) None
Redemption Fees.................................................. None
ANNUAL PORTFOLIO OPERATING EXPENSES (AS A PERCENTAGE OF
AVERAGE NET ASSETS)
Management Fees (after expense reimbursements)(a)................. 0%
12b-1 Fees........................................................ 0
Other Expenses (after expense reimbursements)..................... .27
----
Total Portfolio Operating Expenses (after expense
reimbursements)(b) ............................................. .27%
====
(a) The investment manager is currently voluntarily waiving its management fee
with respect to the Portfolio. Absent this waiver, the amount of Management
Fees and Total Fund Expenses would be .50% and .77%, respectively, for the
Portfolio.
EXAMPLE
You would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2)
redemption at the end of each time period:
One Year ............................................................ $ 3
Three Years.......................................................... 9
Five Years........................................................... 15
Ten Years............................................................ 34
You would pay the following expenses on the same investment,
assuming no redemption:
One Year............................................................. $ 3
Three Years.......................................................... 9
Five Years........................................................... 15
Ten Years............................................................ 34
iii
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FINANCIAL HIGHLIGHTS
The Financial Highlights for the years ended October 31, 1990 through 1994 have
been audited by Arthur Andersen LLP, the Fund's independent public accountants,
as indicated in their report dated December 9, 1994 on the Fund's financial
statements as of October 31, 1994 which are included in the Fund's Statement of
Additional Information. The Financial Highlights should be read in conjunction
with the Fund's financial statements and related notes. The Financial
Highlights, with the exception of the total return information, for the two
years ended October 31, 1989 and the period from November 11, 1986 (commencement
of operations) to October 31, 1987 have been audited by other independent
accountants, who have expressed an unqualified opinion thereon. The Statement of
Additional Information may be obtained from the Fund without charge.
THE ALGER FUND
MONEY MARKET PORTFOLIO
Financial Highlights
For a share outstanding throughout the period
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------------------------------------------------
1994 1993 1992 1991 1990 1989 1988 1987*
---- ---- ---- ---- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year....... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
-------- -------- -------- -------- -------- ------- ------- ------
Net investment income.................... .0374 .0304 .0424 .0671 .0844 .0927 .0732 .0541
Dividends from net investment income..... (.0374) (.0304) (.0424) (.0671) (.0844) (.0927) (.0732) (.0541)
-------- -------- -------- -------- -------- ------- ------- ------
Net asset value, end of year............. $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
======== ======== ======== ======== ======== ======= ======= ======
Total Return .......................... 3.8% 3.1% 4.3% 6.9% 8.8% 9.7%(i) 7.6%(i) 5.6%(i)
======== ======== ======== ======== ======== ======= ======= ======
Ratios and Supplemental Data:
Net assets, end of year (000's omitted) $163,170 $126,567 $135,288 $160,898 $143,420 $69,581 $11,509 $4,247
======== ======== ======== ======== ======== ======= ======= ======
Ratio of expenses to average net assets .27% .41% .25% .18% .03% -- -- .64%
======== ======== ======== ======== ======== ======= ======= ======
Decrease reflected in above expense
ratios due to expense reimbursements
and management fee waivers........... .50% .50% .60% .63% .84% .93% 1.73% 1.88%
======== ======== ======== ======== ======== ======= ======= ======
Ratio of net investment income to
average net assets................... 3.78% 3.04% 4.30% 6.76% 8.37% 9.45% 7.16% 5.82%
======== ======== ======== ======== ======== ======= ======= ======
</TABLE>
* From November 11, 1986 (commencement of operations) through October 31, 1987.
Ratios have been annualized; total return has not been annualized.
(i)Unaudited.
iv
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HOW TO BUY SHARES
IN GENERAL
You can buy shares of the Alger Money Market Portfolio (the "Portfolio") in
any of the following ways: through the Fund's transfer agent; through a broker,
dealer or financial institution who has a sales agreement with Fred Alger &
Company, Incorporated ("Alger Inc."), the Fund's distributor; or automatically
from your bank account through an Automatic Investment Plan. There is no minimum
investment requirement except for purchases through the Telepurchase Privilege.
The Fund or the transfer agent may reject any purchase order.
PURCHASES THROUGH THE TRANSFER AGENT
You can buy shares through Alger Shareholder Services, Inc., the Fund's
transfer agent, by filling out the New Account Application and returning it with
a check drawn on a U.S. bank to Alger Shareholder Services, Inc. at 30
Montgomery Street, Box 2001, Jersey City, NJ 07302. You can also purchase shares
by wire transfer according to the instructions below.
Purchases for the Portfolio will be processed at the net asset value
calculated after your order is received and accepted. If your purchase is made
by wire and is received by 12:00 noon Eastern time, your account will be
credited and begin earning dividends on the day of receipt. If your wire
purchase is received after 12:00 noon Eastern time, it will be credited and
begin earning dividends the next business day. Exchanges are credited the day
the request is received by mail or telephone, and begin earning dividends the
next business day. If your purchase is made by check, and received by the close
of business of the New York Stock Exchange (normally 4:00 p.m. Eastern time), it
will be credited and begin earning dividends the next business day. You will be
charged $10.00 for any check returned by your bank.
WIRE TRANSFERS
Investors establishing new accounts by wire transfer should forward their
completed New Account Applications to the Transfer Agent, stating that the
account was established by wire transfer and the date and amount of the
transfer. Further information regarding wire transfers is available by calling
(800) 992-3863.
The following information should be included in wire transfers to Fund
accounts:
1. Nat West NJ/CUST/021200339
2. For Account 011313045 A/C Alger/Money Market Portfolio
3. 07--Account Number (if new account indicate such)
4. Name of Account
5. Social Security or Taxpayer Identification Number
EXAMPLE:
Nat West NJ/CUST/021200339
For Account 011313045 A/C
Alger/Money Market Portfolio
07-123456789 or 07-New Account
John & Jane Doe
123-45-6789
PURCHASES THROUGH PROCESSING ORGANIZATIONS
You can buy shares through a "Processing Organization", which is a
broker-dealer, bank or other financial institution that purchases shares for its
customers. Processing Organizations may impose charges and restrictions in
addition to or different from those applicable if you invest with the Fund
directly. Therefore, you should read the materials provided by the Processing
Organization in conjunction with this Prospectus. Certain Processing
Organizations may receive compensation from the Fund, Alger Inc., or any of its
affiliates.
SPECIAL INVESTOR SERVICES
TELEPURCHASE PRIVILEGE
You can purchase shares by telephone (minimum $500, maximum $50,000) by
filling out the appropriate section of the New Account Application or sending an
Additional Services Form to the transfer agent. Your funds will be transferred
from your designated bank account to your account normally within two business
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days. To use this service, your bank must be a member of the Automated Clearing
House.
AUTOMATIC INVESTMENT PLAN
The Fund offers an Automatic Investment Plan which permits you to make
regular transfers to your Portfolio account from your bank account on the last
business day of every month. Your bank must be a member of the Automated
Clearing House.
For more information on any of the services discussed above, please call the
Fund toll-free at (800) 992-3863.
RETIREMENT PLANS
Shares of the Portfolio are available as an investment for your retirement
plans, including IRAs, Keogh Plans, corporate pension and profit-sharing plans,
Simplified Employee Pension IRAs, 401(k) Plans and 403(b) Plans. Please call the
Fund at (800) 992-3863 to receive the appropriate documents which contain
important information and applications.
HOW TO SELL SHARES
You can sell (redeem) some or all of your shares on any business day. Your
shares will be sold at the next net asset value calculated after your redemption
request is received and accepted by the transfer agent and your payment will be
made by check within seven days. Redemptions may be suspended and payments
delayed under certain emergency circumstances as determined by the Securities
and Exchange Commission. The Fund's transfer agent will reject any redemption
request made within 15 days after receipt of the purchase check order against
which such redemption is requested. You can sell your shares in any of the
following ways: by mail, by telephone, by check or through your broker.
SELLING SHARES BY MAIL
You should send a letter of instruction to the transfer agent that includes
your name, account number, Portfolio name, the number of shares or dollar amount
and where you want the money to be sent. The letter must be signed by all
authorized signers and, if the redemption is for more than $5,000, or if the
proceeds are to be sent to an address other than the address of record, the
signature must be guaranteed. The transfer agent will accept a signature
guarantee by the following financial institutions: a U.S. bank, trust company,
broker, dealer, municipal securities broker or dealer, government securities
broker or dealer, credit union which is authorized to provide signature
guarantees, national securities exchange, registered securities association or
clearing agency.
SELLING SHARES BY TELEPHONE
If you wish to use this service, you should mark the appropriate box on the
New Account Application or send a written request with a guaranteed signature.
To sell shares by telephone, please call (800) 992-3863. If your proceeds are
less than $2,500, they will be mailed to your address of record. If the proceeds
are more than $2,500 they will be mailed to your address of record or wired to
your designated bank account on the next business day. This service is not
available within 90 days of changing your address or bank account of record.
The Fund, the transfer agent and their affiliates are not liable for acting
in good faith on telephone instructions relating to your account, so long as
they follow reasonable procedures to determine that the telephone instructions
are genuine. Such procedures may include recording the telephone calls and
requiring some form of personal identification. You should verify the accuracy
of telephone transactions immediately upon receipt of your confirmation
statement.
You may use the TeleRedemption Service to transfer funds (minimum $500,
maximum $50,000) between your account and your designated bank account. Your
bank must be a member of the Automated Clearing House. Redemption proceeds will
be transferred to your bank account, generally within two business days after
your redemption request is received. Although the Fund is authorized to charge a
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fee of $17.00 for each wire redemption, it does not currently intend to do so.
Shares held in any Alger retirement plan and shares issued in certificate form
are not eligible for this service.
SELLING SHARES BY CHECK
You may redeem shares in your account by writing a check for at least $500.
Dividends are earned until the check clears. If you mark the appropriate box on
the New Account Application and sign the signature card, the Fund will send you
redemption checks. There is no charge to you for this service.
SYSTEMATIC WITHDRAWAL PLAN
If your account is $10,000 or more, you can establish a Systematic Withdrawal
Plan to receive payments of at least $50 on a monthly, quarterly or annual
basis, without payment of the contingent deferred sales charge. The maximum
monthly withdrawal is one percent of the current account value in the Portfolio
at the time you begin participation in the Plan.
REDEMPTION IN KIND
Under unusual circumstances, shares of the Portfolio may be redeemed "in
kind", which means that the redemption proceeds will be paid with securities
which are held by the Portfolio. Please refer to the Statement of Additional
Information for more details.
HOW TO EXCHANGE SHARES
If you want to authorize exchanges by telephone, you should mark the
appropriate box on the New Account Application. Shares of the Portfolio may be
exchanged for shares of another portfolio at net asset value per share at the
time of the exchange. No contingent deferred sales charge is assessed in
connection with exchanges. For tax purposes, an exchange of shares is treated as
a sale of the shares exchanged and, therefore, you may realize a taxable gain or
loss when you exchange shares. Shares exchanged prior to the close of business
of the New York Stock Exchange (normally 4:00 p.m. Eastern time) from the
Portfolio to any other portfolio will receive dividends from the Portfolio for
the day of the exchange. Shares of the Portfolio received in exchange for shares
of any other portfolio will earn dividends beginning on the next business day
after the exchange.
You may make up to six exchanges annually by telephone or in writing. The
Fund may charge a $5.00 transaction fee for each exchange, although it does not
intend to do so at present. You will be notified at least 60 days in advance if
the Fund decides to impose this fee. The Fund reserves the right to terminate or
modify the exchange privilege upon notice to shareholders.
INVESTMENT OBJECTIVE
AND POLICIES
The investment objective and restrictions summarized below are fundamental
which means that they may not be changed without shareholder approval. All
investment policies and practices described elsewhere in this Prospectus and in
the Statement of Additional Information are not fundamental, so the Fund's Board
of Trustees may change them without shareholder approval. There is no guarantee
that the Portfolio's objective will be achieved.
As a matter of fundamental policy, the Portfolio will not: (1) with respect
to 75% of its total assets, invest more than 5% of its total assets in any one
issuer, except for obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities ("U.S. Government securities"); (2) own more than
10% of the outstanding voting securities of any company; (3) invest more than
10% of its net assets in securities that are not readily marketable and in
repurchase agreements with maturities of more than seven days; (4) invest more
than 25% of its total assets in any one industry, except for U.S. Government
securities and bank and thrift obligations; (5) borrow money or pledge its
assets, except for temporary or emergency purposes, in an amount not exceeding
10% of its total assets. The Statement of Additional Information contains
additional investment restrictions as well as information on the Portfolio's
investment practices.
3
<PAGE>
The investment objective of the Portfolio is to earn high current income
consistent with preservation of principal and maintenance of liquidity. The
Portfolio may invest in "money market" instruments including, certificates of
deposit, time deposits and bankers' acceptances; U.S. Government securities;
corporate bonds having less than 397 days remaining to maturity; and commercial
paper, including variable rate master demand notes. The Portfolio may also enter
into repurchase agreements, reverse repurchase agreements and firm commitment
agreements. The Statement of Additional Information contains more information on
these instruments.
The Portfolio will invest at least 95% of its total assets in money market
securities which are rated within the highest credit category assigned by at
least two established rating agencies (or one rating agency if the security is
rated by only one) and will only invest in money market securities rated at the
time of purchase within the two highest credit categories or, if not rated of
equivalent investment quality as determined by Fred Alger Management, Inc.
("Alger Management"), the Fund's investment manager. Alger Management subjects
all securities eligible for investment to its own credit analysis and considers
all securities purchased by the Portfolio to present minimal credit risks.
The Portfolio has a policy of maintaining a stable net asset value of $1.00.
This policy has been maintained since its inception; however, the $1.00 price is
not guaranteed or insured, nor is its yield fixed. The Portfolio generally
purchases securities which mature in 13 months or less. The average maturity of
the Portfolio will not be greater than 90 days. A discussion of rating agencies
is included in the Appendix to the Statement of Additional Information.
INVESTMENT PRACTICES
The Portfolio may use the investment strategies and invest in the types of
securities described below, which may involve certain risks. The Statement of
Additional Information contains more detailed information about these practices
and information about other investment practices of the Portfolio.
BANK OBLIGATIONS
These are certificates of deposit, bankers' acceptances, and other short-term
debt obligations. Certificates of deposit are short-term obligations of
commercial banks. A bankers' acceptance is a time draft drawn on a commercial
bank by a borrower, usually in connection with international commercial
transactions. Certificates of deposit may have fixed or variable rates.
REPURCHASE AGREEMENTS
In a repurchase agreement, the Portfolio buys a security at one price and
simultaneously agrees to sell it back at a higher price. In the event of a
bankruptcy or default of the other party to the repurchase agreement, the
Portfolio could experience costs and delays in liquidating the underlying
security, which is held as collateral, and the Portfolio might incur a loss if
the value of the collateral held declines during this period.
ILLIQUID AND RESTRICTED SECURITIES
Under the policies and procedures established by the Fund's Board of
Trustees, Fred Alger Management, Inc. ("Alger Management") determines the
liquidity of the Portfolio's investments. Investments may be illiquid because of
the absence of an active trading market, making it difficult to sell promptly at
an acceptable price. The Portfolio may purchase securities eligible for resale
under Rule 144A of the Securities Act of 1933. This rule permits otherwise
restricted securities to be sold to certain institutional buyers. The Portfolio
will limit its purchases of these securities to those which Alger Management,
under the supervision of the Fund's Board of Trustees, determines to be liquid.
A restricted security is one that has a contractual restriction on its resale or
which cannot be sold publicly until it is registered under the Securities Act of
1933.
LENDING OF PORTFOLIO SECURITIES
In order to generate income and to offset expenses, the Portfolio may lend
portfolio securities with a value up to 331/3% of the Portfolio's total assets
to brokers, dealers and other financial organizations. Any such loan will be
4
<PAGE>
continuously secured by collateral at least equal to the value of the securities
loaned. Such lending could result in delays in receiving additional collateral
or in the recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially.
MANAGEMENT OF THE FUND
ORGANIZATION
The Fund was organized on March 20, 1986 as a multi-series Massachusetts
business trust. The Fund offers an unlimited number of shares of six series,
representing the shares of the Fund's portfolios including the Portfolio.
Although the Fund is not required by law to hold annual shareholder meetings,
it may hold meetings from time to time on important matters, and shareholders
have the right to call a meeting to remove a Trustee or to take other action
described in the Trust's Declaration of Trust. Shareholders of the Portfolio may
vote only on matters that affect the Portfolio.
BOARD OF TRUSTEES
The Fund is governed by a Board of Trustees which is responsible for
protecting the interests of shareholders under Massachusetts law. The Statement
of Additional Information contains general background information about each
Trustee and officer of the Fund.
INVESTMENT MANAGER
Alger Management is the Fund's investment manager and is responsible for the
overall administration of the Fund, subject to the supervision of the Board of
Trustees. Alger Management makes investment decisions for the Portfolio, places
orders to purchase and sell securities on behalf of the Portfolio and selects
broker-dealers that, in its judgment, provide prompt and reliable execution at
favorable prices and reasonable commission rates. It is anticipated that Alger
Inc. will serve as the Fund's broker in effecting substantially all of the
Portfolio's transactions on securities exchanges and will retain commissions in
accordance with certain regulations of the Securities and Exchange Commission.
The Fund will consider sales of its shares as a factor in the selection of
broker-dealers to execute over-the-counter portfolio transactions, subject to
the requirements of best price and execution. In addition, Alger Management
employs professional securities analysts who provide research services
exclusively to the Portfolio and other accounts for which Alger Management or
its affiliates serve as investment adviser or subadviser.
Alger Management has been in the business of providing investment advisory
services since 1964 and, as of December 31, 1994, had approximately $2.9 billion
under management, $1.4 billion in mutual fund accounts and $1.5 billion in other
advisory accounts. Alger Management is owned by Alger Inc. which in turn is
owned by Alger Associates, Inc., a financial services holding company. Fred M.
Alger, III and his brother, David D. Alger, are the majority shareholders of
Alger Associates, Inc. and may be deemed to control that company and its
subsidiaries.
Fund personnel ("Access Persons") are permitted to engage in personal
securities transactions subject to the restrictions and procedures of the Fund's
Code of Ethics. Pursuant to the Code of Ethics, Access Persons generally must
preclear all personal securities transactions prior to trading and are subject
to certain prohibitions on personal trading. You can get a copy of the Fund's
Code of Ethics by calling the Fund toll-free at (800) 992-3863.
FEE AND EXPENSES
The Portfolio pays Alger Management a management fee computed daily and paid
monthly at an annual rate of .50% of the value of the Portfolio's average daily
net assets.
The Portfolio pays other expenses related to its daily operations, such as
custodian fees, Trustees' fees, transfer agency fees, legal and auditing costs.
More information about the Portfolio's investment management agreement and other
expenses paid by the Portfolio is included in the Statement of Additional
Information.
The Statement of Additional Information contains information about the Fund's
brokerage policies and practices.
5
<PAGE>
DISTRIBUTOR
Alger Inc. serves as the Fund's distributor and also distributes the shares
of other mutual funds managed by Alger Management.
TRANSFER AGENT
Alger Shareholder Services, Inc., an affiliate of Alger Management, serves as
transfer agent for the Fund. Certain record-keeping services that would
otherwise be performed by Alger Shareholder Services, Inc. may be performed by
other entities providing similar services to their customers who invest in the
Portfolio. The Fund, Alger Shareholder Services, Inc., Alger Inc. or any of its
affiliates may elect to enter into a contract to pay them for such services.
NET ASSET VALUE
The price of one share of the Portfolio is its "net asset value." The net
asset value is computed by adding the value of the Portfolio's investments plus
cash and other assets, deducting liabilities and then dividing the result by the
number of its shares outstanding. The net asset value of the Portfolio is
calculated on each day the New York Stock Exchange is open as of 12:00 noon
Eastern time.
CONTINGENT DEFERRED
SALES CHARGE
There is no initial sales charge on purchases of shares of any Portfolio, but
a contingent deferred sales charge may be charged on certain redemptions. The
charge is imposed on any redemption that causes the current value of your
account in any Portfolio other than the Alger Money Market Portfolio to fall
below the amount of purchase payments made during a six-year holding period.
There is no charge on redemptions of (i) shares that represent appreciation on
your original investment, or (ii) shares purchased through reinvestment of
dividends and capital gains. No charge is imposed on the redemption of shares of
the Portfolio, except for redemption of shares acquired in exchange for shares
of the other portfolios. The amount of the charge is based on the length of time
shares are held, according to the following table:
Contingent
Deferred
Years Share Were Held Charge
------------------------------------ ----------
Less than one........................ 5%
One but less than two................ 4%
Two but less than three.............. 3%
Three but less than four............. 2%
Four but less than five.............. 2%
Five but less than six............... 1%
Six and greater...................... 0%
For purposes of the charge, it is assumed that the shares redeemed are the
shares of the Portfolio held the longest and which result in the lowest charge.
DIVIDENDS AND TAXES
DIVIDENDS
Dividends and distributions will be automatically reinvested on the payment
date in additional shares of the Portfolio at net asset value, unless you
elected on the New Account Application to have all dividends and distributions
paid in cash. Dividends of the Portfolio are declared and paid monthly.
Distributions of any net realized short-term and long-term capital gains earned
by the Portfolio usually will be made annually after the close of the fiscal
year in which the gains are earned.
TAXES
The Fund intends that the Portfolio separately qualify and elect to be
treated each year as a "regulated investment company" for federal income tax
purposes. A regulated investment company is not subject to regular income tax on
any income or capital gains distributed to its shareholders if it, among other
things, distributes at least 90 percent of its investment company taxable income
to them within applicable time periods. The Portfolio is treated as a separate
taxable entity, with the result that taxable dividends and distributions from
the Portfolio reflect only the income and gains, net of losses, of the
Portfolio.
6
<PAGE>
For federal income tax purposes dividends and distributions from the
Portfolio are taxable to you whether paid in cash or reinvested in additional
shares. You may also be liable for tax on any gain realized upon the redemption
or exchange of shares in the Portfolio.
Shortly after the close of each calendar year, you will receive a statement
setting forth the dollar amounts of dividends and any distributions for the
prior calendar year and the tax status of the dividends and distributions for
federal income tax purposes. You should consult your tax adviser to assess the
federal, state and local tax consequences of investing in the Portfolio. This
discussion is not intended to address the tax consequences of an investment by a
nonresident alien.
PERFORMANCE
All performance figures are based on historical earnings and are not intended
to indicate future performance. Further information about the Fund's performance
is contained in its Annual Report to Shareholders, which may be obtained without
charge by contacting the Fund.
The Portfolio may advertise its "yield" and "effective yield." The "yield" of
the Portfolio refers to the income generated by an investment in the Portfolio
over a particular base period. This income is then "annualized." That is, the
amount of income generated by the investment during the period is assumed to be
generated over a 52 week period and is shown as a percentage of the investment.
The "effective yield" is calculated similarly but, when annualized, the income
earned by an investment in the Portfolio is assumed to be reinvested. The
"effective yield" will be slightly higher than the "yield" because of the
compounding effect on this assumed reinvestment.
The Statement of Additional Information further describes the method used to
determine the yields and total return figures. Current yield and/or total return
quotations may be obtained by contacting the Fund.
7
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, THE STATEMENT OF
ADDITIONAL INFORMATION OR THE FUND'S OFFICIAL SALES LITERATURE IN CONNECTION
WITH THE OFFERING OF THE PORTFOLIO'S SHARES, AND IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED ON AS HAVING BEEN AUTHORIZED
BY THE FUND. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH,
OR TO ANY PERSON TO WHOM, SUCH OFFER MAY NOT LAWFULLY BE MADE.
----------
INVESTMENT MANAGER:
Fred Alger Management, Inc.
75 Maiden Lane
New York, New York 10038
DISTRIBUTOR:
Fred Alger & Company, Incorporated
30 Montgomery Street
Jersey City, New Jersey 07302
TRANSFER AGENT:
Alger Shareholder Services, Inc.
30 Montgomery Street
Box 2001
Jersey City, New Jersey 07302
AUDITORS:
Arthur Andersen LLP
1345 Avenue of the Americas
New York, New York 10105
THE | Meeting the challenge
ALGER | of investing
FUND |
ALGER MONEY MARKET PORTFOLIO
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| April 18, 1995
PROSPECTUS | as Supplemented
| September 18, 1995
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