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VAN KAMPEN AMERICAN CAPITAL
HARBOR FUND
SUPPLEMENT DATED NOVEMBER 2, 1995, TO THE
STATEMENT OF ADDITIONAL INFORMATION DATED AUGUST 21, 1995.
The section of the Statement of Additional Information captioned "Fund
Performance" is hereby supplemented as follows:
The Fund seeks to provide current income, capital appreciation and
conservation of capital by investing principally in senior securities,
primarily convertible bonds and convertible preferred stocks of other
corporations. The Fund attempts to remain fully invested and diversified
across many industries to achieve consistent long-term performance.
Convertible securities typically have offered a higher current yield than
that offered by the underlying stock and less downside risk, which has
helped the Fund achieve its investment objectives. The Fund may be an
important complement to an existing portfolio for investors who want both
the opportunity for capital appreciation, regular income and lower
volatility of returns.
Since the commencement of investment operations on November 15, 1956, the
world has experienced a number of significant political and economic
events. For example, in 1971, there were wage and price freezes to attempt
to control inflation. In 1973 the dollar was devalued and the OPEC oil
embargo was in effect. 1976 saw sweeping tax law changes, and in 1979 the
CPI rose over 13%, it's largest rise in 33 years. In 1982, the country was
in a recession, in 1985 the U.S. deficit became the largest in the world
and the U.S. was now a debtor nation. 1987 saw the stock market crash. The
Persian Gulf War began in 1991, and the Dow Jones Industrial Average hit a
record high of 4000 in 1995.
From time to time marketing materials may contain a portfolio manager
update on the Fund or discuss general economic conditions. The top 10
holdings of the Fund may also be listed in marketing pieces.
