IVY FUND, 485BPOS, 1996-12-23

IVY FUND
485BPOS, 1996-12-23

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As filed with the Securities and Exchange Commission on
December 23, 1996 (File No. 2-17613)

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933 Post-Effective Amendment No. 89
[ X ]

and

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 Amendment No. [ X ]

IVY FUND
(Exact Name of Registrant as Specified in
Charter)

Via Mizner Financial Plaza
700 South Federal Highway - Suite 300
Boca Raton, Florida 33432
(Address of Principal Executive Offices)

Registrant's Telephone Number: (800)
777-6472

C. William Ferris
Mackenzie Investment Management Inc.
Via Mizner Financial Plaza
700 South Federal Highway - Suite 300
Boca Raton, Florida 33432
(Name and Address of Agent for Service)

Copies to:

Joseph R. Fleming, Esq.
Dechert Price & Rhoads
Ten Post Office Square, South - Suite 1230
Boston, MA 02109

[ X ] It is proposed that this Post-Effective
Amendment become effective on January 1, 1997
pursuant to subparagraph (b) of Rule 485.

The Registrant has elected to register an indefinite
number of shares of beneficial interest under the
Securities Act of 1933 pursuant to Rule 24f-2 under the
Investment Company Act of 1940; accordingly, no fee is
payable herewith. The Registrant filed on February 28,
1996 its notice pursuant to Rule 24f-2 for the
Registrant's most recent fiscal year ended December 31, 1995.

THIS POST-EFFECTIVE AMENDMENT NO. 89 IS BEING FILED
SOLELY IN ORDER TO ADD TO THE EXISTING PROSPECTUS,
DATED APRIL 30, 1996,

FOR IVY CANADA FUND, IVY CHINA REGION FUND, IVY GLOBAL
FUND, IVY INTERNATIONAL FUND, IVY LATIN AMERICA
STRATEGY FUND AND IVY NEW

CENTURY FUND (I) THE EXISTING PROSPECTUS, DATED JULY
20, 1996, FOR IVY GLOBAL SCIENCE & TECHNOLOGY FUND AND
(II) DISCLOSURE

RELATING TO THREE NEW PORTFOLIOS OF THE TRUST
DESIGNATED AS IVY GLOBAL NATURAL RESOURCES FUND, IVY
ASIA PACIFIC FUND AND IVY

INTERNATIONAL SMALL COMPANIES FUND, THE PROSPECTUSES
AND STATEMENTS OF ADDITIONAL INFORMATION OF WHICH WERE
FILED PURSUANT

TO RULE 485(A)(2) ON OCTOBER 16, 1996. AS SUCH, THE
PROSPECTUSES AND STATEMENTS OF ADDITIONAL INFORMATION
THAT ARE INCLUDED IN

THIS POST-EFFECTIVE AMENDMENT NO. 89 ARE TO BE USED
CONCURRENTLY WITH AND SEPARATELY FROM EACH PROSPECTUS
AND STATEMENT OF

ADDITIONAL INFORMATION FOR THE OTHER 6 SERIES OFFERED
BY THE REGISTRANT DESIGNATED AS IVY BOND FUND, IVY
EMERGING GROWTH FUND,

IVY GROWTH FUND, IVY GROWTH WITH INCOME FUND, IVY
INTERNATIONAL BOND FUND AND IVY MONEY MARKET FUND,
WHICH ARE INCORPORATED BY

REFERENCE TO THIS FILING.

IVY FUND

CROSS REFERENCE SHEET

Post-Effective Amendment No. 89 contains the
Prospectuses and Statements of Additional Information
to be used with Ivy Asia Pacific Fund, Ivy Canada Fund,
Ivy China Region Fund, Ivy Global Fund, Ivy Global
Natural Resources Fund, Ivy Global Science & Technology
Fund, Ivy International Fund, Ivy International Small
Companies Fund, Ivy Latin America Strategy Fund and Ivy New
Century Fund, ten of the sixteen series of Ivy Fund (the
"Registrant"). The other six series of the Registrant are
described in separate prospectuses and statements of
additional information, which are not included herewith
but are incorporated by reference herein.

Items Required by Form N-1A

PART A:

1 COVER PAGE: Cover Page

2 SYNOPSIS: Not Applicable

3 CONDENSED FINANCIAL INFORMATION: Schedule of Fees

4 GENERAL DESCRIPTION OF REGISTRANT: Investment
Objectives and Policies; Risk Factors and
Investment Techniques

5 MANAGEMENT OF THE FUND: Organization and
Management of the Fund; Investment Manager

6 CAPITAL STOCK AND OTHER SECURITIES: Dividends and
Taxes

7 PURCHASE OF SECURITIES BEING OFFERED: How to Buy
Shares; How Your Purchase Price is Determined; How
the Fund Values its Shares

8 REDEMPTION OR REPURCHASE: How to Redeem Shares;
Minimum Account Balance Requirements; Tax
Identification Number; Certificates; Exchange
Privilege; Reinvestment Privilege

9 PENDING LEGAL PROCEEDINGS: Not Applicable

PART B:

10 COVER PAGE: Cover Page

11 TABLE OF CONTENTS: Table of Contents

12 GENERAL INFORMATION AND HISTORY: Investment
Objectives and Policies

13 INVESTMENT OBJECTIVES AND POLICIES: Investment
Objectives and Policies; Investment Restrictions;
Additional Restrictions

14 MANAGEMENT OF THE FUND: Trustees and Officers;
Investment Advisory and Other Services

15 CONTROL PERSONS AND PRINCIPAL HOLDERS OF
SECURITIES: Trustees and Officers; Capitalization
and Voting Rights

16 INVESTMENT ADVISORY AND OTHER SERVICES:
Investment Advisory and Other Services

17 BROKERAGE ALLOCATION AND OTHER PRACTICES:
Brokerage Allocation; Portfolio Turnover

18 CAPITAL STOCK AND OTHER SECURITIES:
Capitalization and Voting Rights

19 PURCHASE, REDEMPTION AND PRICING OF SECURITIES
BEING OFFERED: Net Asset Value; Redemptions

20 TAX STATUS: Taxation

21 UNDERWRITERS: Investment Advisory and Other
Services

22 CALCULATION OF PERFORMANCE DATA: Performance
Information

23 FINANCIAL STATEMENTS: Financial Statements

<PAGE> 1
IVY FUNDS
January 1, 1997

Ivy
International
Equity
Funds

- ---------------------
PROSPECTUS
- ---------------------

Ivy Management, Inc.
Via Mizner Financial
700 South Federal Hwy.
Boca Raton, FL 33432
1-800-456-5111

THROUGHOUT THE
CENTURIES,
THE CASTLE KEEP HAS
BEEN A SOURCE
OF LONG-RANGE VISION
AND STRATEGIC
ADVANTAGE.

Ivy Fund (the "Trust") is a registered investment company currently
consisting of sixteen separate portfolios. Ten of these portfolios, as
identified below (the "Funds"), are described in this Prospectus. Each Fund has
its own investment objective and policies, and your interest is limited to the
Fund in which you own shares. The ten Ivy international equity funds are:

Ivy Asia Pacific Fund
Ivy Canada Fund
Ivy China Region Fund
Ivy Global Fund
Ivy Global Natural Resources Fund
Ivy Global Science & Technology Fund
Ivy International Fund
Ivy International Small Companies Fund
Ivy Latin America Strategy Fund
Ivy New Century Fund

This Prospectus sets forth concisely the information about the Funds that
a prospective investor should know before investing. Please read it carefully
and retain it for future reference. Additional information about the Funds is
contained in the Statement of Additional Information for the Funds dated
January 1, 1997 (the "SAI"), which has been filed with the Securities and
Exchange Commission and is incorporated by reference into this Prospectus. The
SAI is available upon request and without charge from the Trust at the
Distributor's address and telephone number below.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES 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.

<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Expense Information 2
The Funds' Financial Highlights ......................................... 6
Investment Objectives and Policies....................................... 12
Risk Factors and Investment Techniques................................... 16
Organization and Management of the Funds................................. 21
Investment Manager....................................................... 21
Fund Administration and Accounting....................................... 22
Transfer Agent........................................................... 22
Alternative Purchase Arrangements........................................ 22
Dividends and Taxes...................................................... 22
Performance Data......................................................... 23
How to Buy Shares........................................................ 23
How Your Purchase Price is Determined.................................... 24
How Each Fund Values its Shares.......................................... 24
Initial Sales Charge Alternative-Class A Shares.......................... 24
Contingent Deferred Sales Charge-Class A Shares.......................... 25
Qualifying for a Reduced Sales Charge.................................... 25
Contingent Deferred Sales Charge Alternative-
Class B and Class C Shares ........................................ 26
How to Redeem Shares..................................................... 27
Minimum Account Balance Requirements..................................... 28
Signature Guarantees..................................................... 28
Choosing a Distribution Option........................................... 28
Tax Identification Number................................................ 28
Certificates............................................................. 28
Exchange Privilege....................................................... 28
Reinvestment Privilege................................................... 29
Systematic Withdrawal Plan............................................... 29
Automatic Investment Method.............................................. 30
Consolidated Account Statements.......................................... 30
Retirement Plans......................................................... 30
Shareholder Inquiries.................................................... 30
</TABLE>

<TABLE>
<S> <C> <C> <C>
BOARD OF TRUSTEES OFFICERS TRANSFER AGENT INVESTMENT MANAGER
John S. Anderegg, Jr. Michael G. Landry, Chairman Ivy Mackenzie Ivy Management, Inc.
Paul H. Broyhill Keith J. Carlson, President Services Corp. 700 South Federal Highway
Keith J. Carlson James W. Broadfoot, Vice President P.O. Box 3022 Boca Raton, FL 33432
Stanley Channick C. William Ferris, Boca Raton, FL 33431-0922 1-800-456-5111
Frank W. DeFriece, Jr. Secretary/Treasurer 1-800-777-6472
Roy J. Glauber DISTRIBUTOR
Michael G. Landry LEGAL COUNSEL AUDITORS Ivy Mackenzie
Joseph G. Rosenthal Dechert Price & Rhoads Coopers & Lybrand L.L.P. Distributors, Inc.
Richard N. Silverman Boston, MA Ft. Lauderdale, FL Via Mizner Financial Plaza
J. Brendan Swan 700 South Federal Highway
CUSTODIAN Boca Raton, FL 33432
Brown Brothers Harriman & Co. 1-800-456-5111
Boston, MA
</TABLE>

[LOGO IVY MACKENZIE]

<PAGE> 2

EXPENSE INFORMATION

The tables and examples below are designed to assist you in understanding
the various costs and expenses that you will bear directly or indirectly as an
investor in the Funds. Unless otherwise noted, the information is based on each
Fund's expenses during fiscal year 1995.

SHAREHOLDER TRANSACTION EXPENSES

All Funds offer Class A, Class B and Class C shares. Class I shares are
offered by Ivy Global Science & Technology Fund, Ivy International Fund and Ivy
International Small Companies Fund only (generally referred to herein as the
"Class I Funds".)

<TABLE>
<CAPTION>
MAXIMUM SALES LOAD MAXIMUM CONTINGENT
IMPOSED ON PURCHASES DEFERRED SALES CHARGE
(AS A% OF (AS A % OF ORIGINAL
OFFERING PRICE) PURCHASE PRICE)
-------------------- ---------------------
<S> <C> <C>
Class A............................................................................ 5.75%(1) None(2)
Class B............................................................................ None 5.00%(3)
Class C............................................................................ None 1.00%(4)
Class I............................................................................ None None
</TABLE>

None of the Funds charge a redemption fee, an exchange fee, or a sales load on
reinvested dividends.
- ---------------
(1) Class A shares may be purchased under a variety of plans that provide for
the reduction or elimination of the sales charge.
(2) A contingent deferred sales charge ("CDSC") may apply to the redemption of
Class A shares that are purchased without an initial sales charge. See
"Purchases of Class A Shares at Net Asset Value" and "Contingent Deferred
Sales Charge -- Class A Shares."
(3) The maximum CDSC on Class B shares applies to redemptions during the first
year after purchase. The charge declines to 4% during the second year; 3%
during the third and fourth years; 2% during the fifth year; 1% during the
sixth year; and 0% in the seventh year and thereafter.
(4) The CDSC on Class C shares applies only to redemptions during the first year
after purchase.

2
<PAGE> 3

ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)

<TABLE>
<CAPTION>
TOTAL FUND
MANAGEMENT 12B-1 OTHER OPERATING
FEES SERVICE/ EXPENSES EXPENSES
(AFTER EXPENSE DISTRIBUTION (AFTER EXPENSE (AFTER EXPENSE
REIMBURSEMENTS)* FEES REIMBURSEMENTS)* REIMBURSEMENTS)*
---------------- ------------ ---------------- ----------------
<S> <C> <C> <C> <C>
IVY ASIA PACIFIC FUND**
IVY GLOBAL NATURAL RESOURCES FUND**
Class A................................................. 1.00% 0.25% 0.95% 2.20%
Class B................................................. 1.00% 1.00%(2) 0.95% 2.95%
Class C................................................. 1.00% 1.00%(2) 0.95% 2.95%
IVY CANADA FUND
Class A................................................. 0.85% 0.40% 1.98% 3.23%
Class B................................................. 0.85% 1.00%(2) 1.98% 3.83%
Class C(1).............................................. 0.85% 1.00%(2) 1.98% 3.83%
IVY CHINA REGION FUND
Class A................................................. 0.47% 0.25% 1.48% 2.20%
Class B................................................. 0.47% 1.00%(2) 1.48% 2.95%
Class C(1).............................................. 0.47% 1.00%(2) 1.48% 2.95%
IVY GLOBAL FUND
Class A................................................. 0.74% 0.25% 1.21% 2.20%
Class B................................................. 0.74% 1.00%(2) 1.21% 2.95%
Class C(1).............................................. 0.74% 1.00%(2) 1.21% 2.95%
IVY GLOBAL SCIENCE & TECHNOLOGY FUND***
Class A................................................. 0.00% 0.25% 1.95% 2.20%
Class B................................................. 0.00% 1.00%(2) 1.92% 2.92%
Class C................................................. 0.00% 1.00%(2) 1.89% 2.89%
Class I................................................. 0.00% 0.00% 1.86%(3) 1.86%
IVY INTERNATIONAL FUND
Class A................................................. 1.00% 0.08%(4) 0.44% 1.52%
Class B................................................. 1.00% 1.00%(2) 0.44% 2.44%
Class C(1).............................................. 1.00% 1.00%(2) 0.44% 2.44%
Class I................................................. 1.00% 0.00% 0.35%(3) 1.35%
IVY INTERNATIONAL SMALL COMPANIES FUND**
Class A................................................. 1.00% 0.25% 0.95% 2.20%
Class B................................................. 1.00% 1.00%(2) 0.95% 2.95%
Class C................................................. 1.00% 1.00%(2) 0.95% 2.95%
Class I................................................. 1.00% 0.00% 0.86%(3) 1.86%
IVY LATIN AMERICA STRATEGY FUND
IVY NEW CENTURY FUND
Class A................................................. 0.00% 0.25% 1.95% 2.20%
Class B................................................. 0.00% 1.00%(2) 1.95% 2.95%
Class C(1).............................................. 0.00% 1.00%(2) 1.95% 2.95%
</TABLE>

- ---------------

<TABLE>
<S> <C>
* Ivy Management, Inc. ("IMI") currently limits Total Fund
Operating Expenses (excluding Rule 12b-1 fees) for all Funds
except Ivy Canada Fund and Ivy International Fund to an
annual rate of 1.95% of each Fund's average net assets.
Without expense reimbursements (or expense offset
arrangements, if applicable) Management Fees would have been
1.00% and Total Fund Operating Expenses (excluding Rule
12b-1 fees) would have been 2.48% for Ivy China Region Fund;
2.21% for Ivy Global Fund; 9.01% for Ivy Latin America
Strategy Fund; 6.93% for Ivy New Century Fund and 3.82%
greater than each figure shown for Ivy Global Science &
Technology Fund.
** Expense information is based on estimated amounts for the
current fiscal year.
*** Expense information is based on amounts from July 22, 1996
(commencement of operations) to October 31, 1996.
(1) The inception date for Class C shares was April 30, 1996.
The expense ratios shown are estimates based on amounts
incurred by the Fund during the year ended December 31,
1995.
(2) Long-term investors may, as a result of the Fund's 12b-1
fees, pay more than the economic equivalent of the maximum
front-end sales charge permitted by the Rules of Fair
Practice of the National Association of Securities Dealers,
Inc. ("NASD").
(3) "Other Expenses" of Class I are lower than such expenses for
Class A, Class B and Class C shares. See "Fund
Administration and Accounting" in this Prospectus and
"Transfer Agent" in the SAI.
(4) Rule 12b-1 Service Fees paid by Class A shares may increase,
but are subject to a maximum of 0.25%. See "Alternative
Purchase Arrangements."
</TABLE>

3
<PAGE> 4

EXAMPLES

The following tables list the expenses that an investor would pay on a
$1,000 investment, assuming (1) 5% annual return and (2) unless otherwise noted,
redemption at the end of each time period. These examples further assume
reinvestment of all dividends and distributions, and that the percentage amounts
under "Total Fund Operating Expenses" (above) remain the same each year. THE
EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE HIGHER OR LOWER THAN THOSE SHOWN.

<TABLE>
<CAPTION>
IVY ASIA PACIFIC FUND+
IVY GLOBAL NATURAL RESOURCES FUND 1 YEAR 3 YEARS
------ -------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 79 $ 122
Class B Shares...................................................................... $ 80(1) $ 121(2)
Class B Shares (no redemption)...................................................... $ 30 $ 91
Class C Shares...................................................................... $ 40(5) $ 91
Class C Shares (no redemption)...................................................... $ 30 $ 91
</TABLE>

<TABLE>
<CAPTION>
IVY CANADA FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 88 $ 151 $ 217 $390
Class B Shares...................................................................... $ 89(1) $ 147(2) $ 217(3) $393(4)
Class B Shares (no redemption)...................................................... $ 39 $ 117 $ 197 $393(4)
Class C Shares...................................................................... $ 49(5) $ 117 $ 197 $406
Class C Shares (no redemption)...................................................... $ 39 $ 117 $ 197 $406
</TABLE>

<TABLE>
<Caption
IVY CHINA REGION FUND
IVY GLOBAL FUND
IVY LATIN AMERICA STRATEGY FUND
IVY NEW CENTURY FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 79 $ 122 $ 169 $296
Class B Shares...................................................................... $ 80(1) $ 121(2) $ 175(3) $309(4)
Class B Shares (no redemption)...................................................... $ 30 $ 91 $ 155 $309(4)
Class C Shares...................................................................... $ 40(5) $ 91 $ 155 $327
Class C Shares (no redemption)...................................................... $ 30 $ 91 $ 155 $327
</TABLE>

<TABLE>
<CAPTION>
IVY GLOBAL SCIENCE & TECHNOLOGY FUND 1 YEAR 3 YEARS
------ -------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 79 $ 122
Class B Shares...................................................................... $ 80(1) $ 120(2)
Class B Shares (no redemption)...................................................... $ 30 $ 90
Class C Shares...................................................................... $ 39(5) $ 89
Class C Shares (no redemption)...................................................... $ 29 $ 89
Class I shares**.................................................................... $ 19 $ 58
</TABLE>

4
<PAGE> 5

<TABLE>
<CAPTION>
IVY INTERNATIONAL FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 72 $ 103 $ 136 $228
Class B Shares...................................................................... $ 75(1) $ 106(2) $ 150(3) $255(4)
Class B Shares (no redemption)...................................................... $ 25 $ 76 $ 130 $255(4)
Class C Shares...................................................................... $ 35(5) $ 76 $ 130 $278
Class C Shares (no redemption)...................................................... $ 25 $ 76 $ 130 $278
Class I Shares**.................................................................... $ 14 $ 43 $ 74 $162
</TABLE>

<TABLE>
<CAPTION>
IVY INTERNATIONAL SMALL COMPANIES FUND+ 1 YEAR 3 YEARS
------ -------
<S> <C> <C> <C> <C>
Class A Shares*..................................................................... $ 79 $ 122
Class B Shares...................................................................... $ 80(1) $ 121(2)
Class B Shares (no redemption)...................................................... $ 30 $ 91
Class C Shares...................................................................... $ 40(5) $ 91
Class C Shares (no redemption)...................................................... $ 30 $ 91
Class I Shares**.................................................................... $ 19 $ 58
</TABLE>

- ---------------

<TABLE>
<S> <C>
* Assumes deduction of the maximum 5.75% initial sales charge
at the time of purchase and no deduction of a CDSC at the
time of redemption.
** Class I Shares are not subject to an initial sales charge at
the time of purchase, nor are they subject to the deduction
of a CDSC at the time of redemption.
+ Expense information is based on estimated amounts for the
current fiscal year.
(1) Assumes deduction of a 5% CDSC at the time of redemption.
(2) Assumes deduction of a 3% CDSC at the time of redemption.
(3) Assumes deduction of a 2% CDSC at the time of redemption.
(4) Assumes conversion to Class A shares at the end of the
eighth year, and therefore reflects Class A expenses for
years nine and ten.
(5) Assumes deduction of a 1% CDSC at the time of redemption.
</TABLE>

The purpose of the foregoing table is to assist an investor in understanding
the various costs and expenses that he or she will bear directly or indirectly.
The information presented in the table does not reflect the charge of $10 per
transaction that would apply if a shareholder elects to have redemption proceeds
wired to his or her bank account. For a more detailed discussion of the Funds'
fees and expenses, see the following sections of this Prospectus: "Organization
and Management of the Funds," "Initial Sales Charge Alternative -- Class A
Shares," and "Contingent Deferred Sales Charge Alternative -- Class B and Class
C Shares," and "Investment Advisory and Other Services" in the SAI.

5
<PAGE> 6

THE FUNDS' FINANCIAL HIGHLIGHTS

Unless otherwise noted, the tables that follow are for fiscal periods ending
December 31 of each year. The accounting firm of Coopers & Lybrand L.L.P. has
audited Ivy Canada Fund, Ivy China Region Fund, Ivy Global Fund, Ivy Latin
America Strategy Fund and Ivy New Century Fund since their inception, and Ivy
International Fund since fiscal year ended December 31, 1992. Their report is
included in these Funds' Annual Reports, which are incorporated by reference
into the SAI. The information for Ivy International Fund for fiscal periods
prior to December 31, 1992 was audited by other independent accountants. The
Annual Reports for these six Funds contain additional information about each
Fund's performance, including a comparison to an appropriate securities index.
For a copy of your Fund's Annual Report, call 1-800-777-6472. Annual Reports are
not yet available for Ivy Global Science & Technology Fund, which commenced
operations on July 22, 1996, or for Ivy Asia Pacific Fund, Ivy Global Natural
Resources Fund or Ivy International Small Companies Fund, which commenced
operations on January 1, 1997.

Expense and income ratios and portfolio turnover rates have been annualized
for periods of less than one year. Total returns do not reflect sales charges,
and are not annualized for periods of less than one year (unless otherwise
noted). In addition, for fiscal years beginning on or after September 1, 1995,
registered investment companies are required to disclose average commission
rates per share for security trades on which commissions are charged. This
amount may vary from period to period and fund to fund depending on the mix of
trades executed in various markets where trading practices and commission rate
structures may differ.

IVY CANADA FUND
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------------------------
SELECTED PER SHARE DATA 1996(H)* 1995 1994(A) 1994(B) 1993(B) 1992(B) 1991(C)
-------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 9.21 $ 8.90 $ 9.85 $10.04 $ 7.43 $ 8.89 $ 8.55
-------- ------- ------- ------- ------- ------- -------
Income (loss) from investment operations:
Net investment income (loss)............... (.10) (.19)(g) (.11) (.11) (.01) (.12) (.03)
Net gain (loss) on investment transactions
(both realized and unrealized)............ .97 .75 (.81) .24 3.35 (1.34) .41
-------- ------- ------- ------- ------- ------- -------
Total from investment operations........ .87 .56 (.92) .13 3.34 (1.46) .38
-------- ------- ------- ------- ------- ------- -------
Less distributions:
From net investment income................. -- -- -- -- -- -- --
From net realized gain..................... .89 .25 -- .31 .73 -- .04
In excess of net realized gain............. .03 -- -- -- -- -- --
From capital paid-in....................... -- -- .03 .01 -- -- --
-------- ------- ------- ------- ------- ------- -------
Total distributions..................... .92 .25 .03 .32 .73 -- .04
-------- ------- ------- ------- ------- ------- -------
Net asset value, end of period............... $ 9.16 $ 9.21 $ 8.90 $ 9.85 $10.04 $ 7.43 $ 8.89
========= ======== ========= ========= ========= ========= =========
Total return(%).............................. 9.45 6.37 (9.38) 1.05 47.10 (16.42) 6.59(j)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $14,474 $19,353 $23,296 $34,549 $30,971 $11,280 $14,369
Ratio of expenses to average net assets:
With expense reimbursement(%)............... -- 2.90 -- -- -- -- --
Without expense reimbursement(%)............ 2.82 3.23 2.44 2.05 2.63 2.70 2.78
Ratio of net investment income (loss) to
average net assets(%)....................... (1.73) (2.13)(g) (1.85) (1.09) (1.41) (1.39) (.52)
Portfolio turnover rate(%)................... 32 21 36 62 32 2 4
Average commission rate...................... $ .0143 N/A N/A N/A N/A N/A N/A

CLASS A
---------------------------------
SELECTED PER SHARE DATA 1990(D) 1989(D) 1988(E)
------- ------- -------
<S> <C> <C> <C>
Net asset value, beginning of period......... $10.53 $10.15 $ 9.50
------- ------- -------
Income (loss) from investment operations:
Net investment income (loss)............... .02 .15 (g) .17 (g)
Net gain (loss) on investment transactions
(both realized and unrealized)............ (1.98) .50 .57
------- ------- -------
Total from investment operations........ (1.96) .65 .74
------- ------- -------
Less distributions:
From net investment income................. .02 .24 .07
From net realized gain..................... -- .03 .02
In excess of net realized gain............. -- -- --
From capital paid-in....................... -- -- --
------- ------- -------
Total distributions..................... .02 .27 .09
------- ------- -------
Net asset value, end of period............... $ 8.55 $10.53 $10.15
========= ========= =========
Total return(%).............................. (18.69) 6.41 8.15
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $14,268 $16,807 $5,360
Ratio of expenses to average net assets:
With expense reimbursement(%)............... -- 2.36 1.91
Without expense reimbursement(%)............ 2.89 3.14 5.05
Ratio of net investment income (loss) to
average net assets(%)....................... .16 1.57 (g) 1.86 (g)
Portfolio turnover rate(%)................... 0 2 3
Average commission rate...................... N/A N/A N/A
</TABLE>
<TABLE>
<CAPTION>
CLASS B
-------------------------------
SELECTED PER SHARE DATA 1996(H)* 1995 1994(A)
------- ------- -------
<S> <C> <C> <C>
Net asset value, beginning of period....................................................... $ 9.21 $ 8.90 $ 9.85
------- ------- -------
Income (loss) from investment operations:
Net investment loss...................................................................... (.11) (.20) (g) (.09)
Net gain (loss) on investment transactions
(both realized and unrealized).......................................................... .95 .71 (.86)
------- ------- -------
Total from investment operations...................................................... .84 .51 (.95)
------- ------- -------
Less distributions:
From net realized gain................................................................... .89 .20 --
In excess of net realized gain........................................................... .03 -- --
------- ------- -------
Total distributions................................................................... .92 .20 --
------- ------- -------
Net asset value, end of period............................................................. $ 9.13 $ 9.21 $ 8.90
========= ========= =========
Total return(%)............................................................................ 9.12 5.74 (9.64)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)................................................... $1,148 $1,142 $ 741
Ratio of expenses to average net assets:
With expense reimbursement(%)............................................................. -- 3.50 --
Without expense reimbursement(%).......................................................... 3.42 3.83 3.03
Ratio of net investment loss to average net assets(%)...................................... (2.33) (2.73) (g) (2.44)
Portfolio turnover rate(%)................................................................. 32 21 36
Average commission rate.................................................................... $.0143 N/A N/A

CLASS B CLASS C
------- -------
SELECTED PER SHARE DATA 1994(F) 1996(I)*
------- -------
<S> <C> <C>
Net asset value, beginning of period......... $10.16 $10.67
------- -------
Income (loss) from investment operations:
Net investment loss........................ (.02) (.01)
Net gain (loss) on investment transactions
(both realized and unrealized)............ (.29) (.60)
------- -------
Total from investment operations........ (.31) (.61)
------- -------
Less distributions:
From net realized gain..................... -- .89
In excess of net realized gain............. -- .03
------- -------
Total distributions..................... -- .92
------- -------
Net asset value, end of period............... $ 9.85 $ 9.14
========= =========
Total return(%).............................. (3.05) (5.72)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $ 227 $ 24
Ratio of expenses to average net assets:
With expense reimbursement(%)............... -- --
Without expense reimbursement(%)............ 2.68 3.42
Ratio of net investment loss to average net a (1.72) (2.33)
Portfolio turnover rate(%)................... 62 32
Average commission rate...................... N/A $.0143
</TABLE>

- ---------------

(a) For the six months ended December 31, 1994.
(b) For the year ended June 30.
(c) For the eight months ended June 30, 1991.
(d) For the year ended October 31.
(e) From November 18, 1987 (commencement of operations) to October 31, 1988.
(f) From April 1, 1994 (commencement) to June 30, 1994.
(g) Net investment income (loss) is net of expenses reimbursed by IMI.
(h) For the six months ended June 30, 1996.
(i) From April 30, 1996 (commencement) to June 30, 1996.
(j) Annualized.
* Unaudited

6
<PAGE> 7

IVY CHINA REGION FUND

<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------
SELECTED PER SHARE DATA 1996(B)* 1995 1994 1993(A)
--------- -------- -------- ---------
<S> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 8.58 $ 8.61 $ 11.55 $ 10.00
--------- -------- -------- ---------
Income (loss) from investment operations:
Net investment income (loss)(d)........... .02 .14 .05 (.01)
Net gain (loss) on investment transactions
(both realized and unrealized)........... .82 (.01) (2.91) 1.57
--------- -------- -------- ---------
Total from investment operations....... .84 .13 (2.86) 1.56
--------- -------- -------- ---------
Less distributions:
From net investment income................ -- .14 .05 --
In excess of net investment income........ -- -- .03 --
In excess of net realized gain............ -- .02 -- --
From capital paid-in...................... -- -- -- .01
--------- -------- -------- ---------
Total distributions.................... -- .16 .08 .01
--------- -------- -------- ---------
Net asset value, end of period............... $ 9.42 $ 8.58 $ 8.61 $ 11.55
========= ======== ======== =========
Total return(%).............................. 9.66 1.59 (24.88) 15.65
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $15,044 $12,855 $13,180 $ 8,371
Ratio of expenses to average net assets:
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.20 2.20 2.20 1.98
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 2.57 2.73 2.76 2.45
Ratio of net investment income (loss) to
average net assets(%)(d).................... .73 1.61 .55 (.91)
Portfolio turnover rate(%)................... 17 25 4 0
Average commission rate...................... $ .0035 N/A N/A N/A
</TABLE>

<TABLE>
<CAPTION>
CLASS B CLASS C
-------------------------------------------------- ---------
SELECTED PER SHARE DATA 1996(B)* 1995 1994 1993(A) 1996(C)*
--------- ------ ------ -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 8.58 $ 8.61 $11.55 $10.00 $ 9.44
--------- ------ ------ -------- ---------
Income (loss) from investment operations:
Net investment income (loss)(d)........... -- .08 (.02) (.02) --
Net gain (loss) on investment transactions
(both realized and unrealized)........... .81 (.02) (2.92) 1.57 (.03)
--------- ------ ------ -------- ---------
Total from investment operations....... .81 .06 (2.94) 1.55 (.03)
--------- ------ ------ -------- ---------
Less distributions:
From net investment income................ -- .08 -- -- --
In excess of net realized gain............ -- .01 -- -- --
--------- ------ ------ -------- ---------
Total distributions.................... -- .09 -- -- --
--------- ------ ------ -------- ---------
Net asset value, end of period............... $ 9.39 $ 8.58 $ 8.61 $11.55 $ 9.41
========= ====== ====== ======== =========
Total return(%).............................. 9.31 .83 (25.45) 15.50 (.32)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $ 8,432 $6,905 $7,336 $3,565 $ --
Ratio of expenses to average net assets:
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.95 2.95 2.95 2.74 2.95
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 3.32 3.48 3.51 3.20 3.32
Ratio of net investment income (loss) to
average net assets(%)(d).................... (.02) .86 (.20) (1.66) (0.2)
Portfolio turnover rate(%)................... 17 25 4 0 17
Average commission rate...................... $ .0035 N/A N/A N/A $ .0035
</TABLE>

- ---------------

(a) From October 23, 1993 (commencement of operations) to December 31, 1993.
(b) For the six months ended June 30, 1996.
(c) From April 30, 1996 (commencement) to June 30, 1996.
(d) Net investment income (loss) is net of expenses reimbursed by IMI.
(e) Beginning in 1995, total expenses include fees paid indirectly through an
expense offset arrangement.

* Unaudited.

7
<PAGE> 8

IVY GLOBAL FUND(H)
<TABLE>
<CAPTION>
CLASS A
-----------------------------------------------------------------------------
SELECTED PER SHARE DATA 1996(E)* 1995 1994(A) 1994(B) 1993(B) 1992(B)
--------- ------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.... $ 11.97 $ 11.23 $ 11.52 $ 10.62 $ 10.55 $ 9.40
--------- ------- -------- -------- -------- --------
Income (loss) from investment
operations:
Net investment income(g)............. .10 .09 -- -- .03 .06
Net gain (loss) on investments
(both realized and unrealized)...... 1.30 1.25 (.10) 1.79 .44 1.79
--------- ------- -------- -------- -------- --------
Total from investment
operations....................... 1.40 1.34 (.10) 1.79 .47 1.85
--------- ------- -------- -------- -------- --------
Less distributions:
From net investment income........... -- .04 -- .01 .03 .06
From net realized gain............... -- .49 .09 .88 .37 .62
In excess of net realized gain....... -- .07 -- -- -- --
From capital paid-in................. -- -- .10 -- -- .02
--------- ------- -------- -------- -------- --------
Total distributions............... -- .60 .19 .89 .40 .70
--------- ------- -------- -------- -------- --------
Net asset value, end of period.......... $ 13.37 $ 11.97 $ 11.23 $ 11.52 $ 10.62 $ 10.55
========= ======= ======== ======== ======== ========
Total return(%)......................... 11.70 12.08 (1.00) 16.71 4.54 19.91
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)............................. $24,692 $21,264 $19,327 $17,393 $12,391 $ 8,780
Ratio of expenses to average net assets:
With expense reimbursement(%).......... 2.20 2.20 2.20 2.20 1.95 2.02
Without expense reimbursement(%)....... 2.24 2.46 2.34 2.42 2.76 2.97
Ratio of net investment income (loss) to
average net assets(%)(g)............... 1.59 .71 (.06) .01 .38 .82
Portfolio turnover rate(%).............. 38 53 23 85 67 59
Average commission rate................. $ .0133 N/A N/A N/A N/A N/A
<CAPTION>

SELECTED PER SHARE DATA 1991(C)
--------
<S> <C>
Net asset value, beginning of period.... $ 10.00
--------
Income (loss) from investment
operations:
Net investment income(g)............. .02
Net gain (loss) on investments
(both realized and unrealized)...... (.61)
--------
Total from investment
operations....................... (.59)
--------
Less distributions:
From net investment income........... .01
From net realized gain............... --
In excess of net realized gain....... --
From capital paid-in................. --
--------
Total distributions............... .01
--------
Net asset value, end of period.......... $ 9.40
========
Total return(%)......................... (24.65)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)............................. $ 1,667
Ratio of expenses to average net assets:
With expense reimbursement(%).......... 2.50
Without expense reimbursement(%)....... 11.70
Ratio of net investment income (loss) to
average net assets(%)(g)............... .81
Portfolio turnover rate(%).............. 24
Average commission rate................. N/A
</TABLE>
<TABLE>
<CAPTION>
CLASS B
-------------------------------------------------
SELECTED PER SHARE DATA 1996(E)* 1995 1994(A) 1994(D)
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net asset value, beginning of period........... $11.97 $11.23 $11.52 $12.12
-------- -------- -------- --------
Income (loss) from investment operations:
Net investment income (loss)(g).............. .05 -- (.03) (.01)
Net gain (loss) on investments
(both realized and unrealized).............. 1.30 1.25 (.12) (.04)
-------- -------- -------- --------
Total from investment operations.......... 1.35 1.25 (.15) (.05)
-------- -------- -------- --------
Less distributions:
From net realized gain....................... -- .45 .08 .55
In excess of net realized gain............... -- .06 -- --
From capital paid-in......................... -- -- .06 --
-------- -------- -------- --------
Total distributions....................... -- .51 .14 .55
-------- -------- -------- --------
Net asset value, end of period.................. $13.32 $11.97 $11.23 $11.52
======== ======== ======== ========
Total return(%)................................. 11.28 11.25 (1.37) (.38)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)........ $6,415 $4,811 $2,956 $ 376
Ratio of expenses to average net assets:
With expense reimbursement(%).................. 2.95 2.95 2.95 2.95
Without expense reimbursement(%)............... 2.99 3.21 3.09 3.17
Ratio of net investment loss to average net
assets(%)(g)................................... .84 (.04) (.81) (.74)
Portfolio turnover rate(%)...................... 38 53 23 85
Average commission rate......................... $.0133 N/A N/A N/A
<CAPTION>
CLASS C
--------
SELECTED PER SHARE DATA 1996(F)*
--------
<S> <C>
Net asset value, beginning of period.... $ 13.31
--------
Income (loss) from investment operation
Net investment income (loss)(g)...... --
Net gain (loss) on investments
(both realized and unrealized)...... .02
--------
Total from investment operations.. .02
--------
Less distributions:
From net realized gain............... --
In excess of net realized gain....... --
From capital paid-in................. --
--------
Total distributions............... --
--------
Net asset value, end of period.......... $ 13.33
========
Total return(%)......................... .15
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ --
Ratio of expenses to average net assets:
With expense reimbursement(%).......... 2.95
Without expense reimbursement(%)....... 2.99
Ratio of net investment loss to average
assets(%)(g)........................... .84
Portfolio turnover rate(%).............. 38
Average commission rate................. $ .0133
</TABLE>

- ---------------

<TABLE>
<S> <C>
(a) For the six months ended December 31, 1994.
(b) For the year ended June 30.
(c) From April 18, 1991 (commencement of operations) to June 30, 1991.
(d) From April 1, 1994 (commencement) to June 30, 1994.
(e) For the six months ended June 30, 1996.
(f) From April 30, 1996 (commencement) to June 30, 1996.
(g) Net investment income (loss) is net of expenses reimbursed by IMI.
(h) Since February 1, 1995, Ivy Global Fund's adviser has been IMI. Prior to
February 1, 1995, Ivy Global Fund's adviser was Mackenzie Investment
Management, Inc. ("MIMI").
* Unaudited.
</TABLE>

8
<PAGE> 9

IVY GLOBAL SCIENCE & TECHNOLOGY FUND*

<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
------- ------- -------
SELECTED PER SHARE DATA 1996(A) 1996(A) 1996(A)
------- ------- -------
<S> <C> <C> <C>
Net asset value, beginning of period.... $10.00 $10.00 $10.00
Income from investment operations:
Net investment loss(b)............... (.14) (.19) (.19)
Net gain on investments (both
realized and unrealized)............ 5.49 5.57 5.62
------ ------ ------
Total from investment
operations........................ 5.39 5.38 5.43
------ ------ ------
Net asset value, end of period.......... $15.35 $15.38 $15.43
====== ====== ======
Total return(%)......................... 53.50 53.80 54.30
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................. $3,743 $ 958 $ 421
Ratio of expenses to average net assets:
With expense reimbursement(%).......... 2.20 2.92 2.89
Without expense reimbursement(%)....... 6.02 6.74 6.71
Ratio of net investment loss to average
net assets(%)(b)....................... (2.07) (2.79) (2.76)
Portfolio turnover rate(%).............. 53% 53 % 53 %
Average commission rate................. $.0598 $.0598 $.0598
</TABLE>

- ---------------

(a) From July 22, 1996 (commencement of operations) to October 31, 1996.
(b) Net investment loss is net of expenses reimbursed by IMI.

* Unaudited.

9
<PAGE> 10

IVY INTERNATIONAL FUND+
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------------------------------
SELECTED PER SHARE DATA 1996(C)* 1995 1994 1993 1992 1991 1990
-------- -------- -------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.... $ 30.67 $ 27.60 $ 27.71 $ 18.88 $ 19.37 $ 16.98 $ 20.31
-------- -------- -------- -------- -------- ------- -------
Income (loss) from investment
operations:
Net investment income................ .29 .25 .07 .12 .27(e) .26 .50
Net gain (loss) on investment
transactions
(both realized and unrealized)...... 3.45 3.22 1.01 9.01 (.26) 2.61 (3.13)
-------- -------- -------- -------- -------- ------- -------
Total from investment
operations....................... 3.74 3.47 1.08 9.13 .01 2.87 (2.63)
-------- -------- -------- -------- -------- ------- -------
Less distributions:
From net investment income........... -- .25 .07 .08 .27 .26 .51
From net realized gain............... -- .12 1.11 .22 .23 .22 .19
In excess of net realized gain....... -- 03 -- -- -- -- --
From capital paid-in................. -- -- .01 -- -- -- --
-------- -------- -------- -------- -------- ------- -------
Total distributions............... -- .40 1.19 .30 .50 .48 .70
-------- -------- -------- -------- -------- ------- -------
Net asset value, end of period.......... $ 34.41 $ 30.67 $ 27.60 $ 27.71 $ 18.88 $ 19.37 $ 16.98
======== ======== ======== ======== ======== ======= =======
Total return(%)......................... 12.19 12.65 3.92 48.37 .07 16.93 (12.97)

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)............................. $699,700 $475,989 $229,586 $172,539 $109,637 $97,486 $64,651
Ratio of expenses to average net
assets(%).............................. 1.61 1.52 1.58 1.61 1.71(f) 1.64 1.66
Ratio of net investment income to
average net assets(%).................. 1.98 .97 .30 .56 1.36(e) 1.50 2.50
Portfolio turnover rate(%).............. 16 6 7 19 20 27 29
Average commission rate................. $ .0056 N/A N/A N/A N/A N/A N/A

CLASS A
------------------------------------------
SELECTED PER SHARE DATA 1989 1988 1987 1986
------- ------- ------- ------
<S> <C> <C> <C> <C>
Net asset value, beginning of period.... $ 16.62 $ 12.90 $ 12.40 $10.07
------- ------- ------- ------
Income (loss) from investment
operations:
Net investment income................ .27 .12 .04 .03
Net gain (loss) on investment
transactions
(both realized and unrealized)...... 4.43 3.71 2.38 2.37
------- ------- ------- ------
Total from investment
operations....................... 4.70 3.83 2.42 2.40
------- ------- ------- ------
Less distributions:
From net investment income........... .17 .11 .05 .07
From net realized gain............... .84 -- 1.87 --
In excess of net realized gain....... -- -- -- --
From capital paid-in................. -- -- -- --
------- ------- ------- ------
Total distributions............... 1.01 .11 1.92 .07
------- ------- ------- ------
Net asset value, end of period.......... $ 20.31 $ 16.62 $ 12.90 $12.40
======= ======= ======= ======
Total return(%)......................... 28.26 29.72 19.51 11.21(g)

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)............................. $58,469 $23,637 $21,146 $9,587
Ratio of expenses to average net
assets(%).............................. 1.80 1.93 1.88 2.00
Ratio of net investment income to
average net assets(%).................. 1.20 .80 .40 .30
Portfolio turnover rate(%).............. 23 45 47 20
Average commission rate................. N/A N/A N/A N/A
</TABLE>
<TABLE>
<CAPTION>
CLASS B CLASS C
-------------------------------------------- --------
SELECTED PER SHARE DATA 1996(C)* 1995 1994 1993(A) 1996(D)*
-------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............. $ 30.67 $ 27.60 $ 27.71 $25.86 $32.68
-------- ------- ------- ------- --------
Income (loss) from investment operations:
Net investment income (loss)................... .14 .01 (.10) (.01) .03
Net gain (loss) on investment transactions
(both realized and unrealized)................ 3.46 3.20 .91 2.12 1.55
-------- ------- ------- ------- --------
Total from investment operations............ 3.60 3.21 .81 2.11 1.58
-------- ------- ------- ------- --------
Less distributions:
From net investment income..................... -- .01 -- .04 --
From net realized gain......................... -- .10 .90 .22 --
In excess of net realized gain................. -- .03 -- -- --
From capital paid-in........................... -- -- .02 -- --
-------- ------- ------- ------- --------
Total distributions......................... -- .14 .92 .26 --
-------- ------- ------- ------- --------
Net asset value, end of period.................... $ 34.27 $ 30.67 $ 27.60 $27.71 $34.26
======== ======= ======= ======= ========
Total return(%)................................... 11.74 11.62 2.96 7.65 4.83

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands).......... $168,490 $74,650 $30,143 $2,846 $3,620
Ratio of expenses to average net assets(%)........ 2.43 2.44 2.50 2.59 2.43
Ratio of net investment income (loss) to average
net assets(%).................................... 1.16 .05 (.62) (.42) 1.16
Portfolio turnover rate(%)........................ 16 6 7 19 16
Average commission rate........................... $ .0056 N/A N/A N/A $.0056

CLASS I
------------------------------
SELECTED PER SHARE DATA 1996(C)* 1995 1994(B)
------- ------- ------
<S> <C> <C> <C>
Net asset value, beginning of period.... $30.67 $ 27.60 $29.06
------- ------- ------
Income (loss) from investment operation
Net investment income (loss)......... .32 .30 .03
Net gain (loss) on investment transac
(both realized and unrealized)...... 3.45 3.22 (.49)
------- ------- ------
Total from investment operations.. 3.77 3.52 (.46)
------- ------- ------
Less distributions:
From net investment income........... -- .30 .03
From net realized gain............... -- .12 .92
In excess of net realized gain....... -- .03 --
From capital paid-in................. -- -- .05
------- ------- ------
Total distributions............... -- .45 1.00
------- ------- ------
Net asset value, end of period.......... $34.44 $ 30.67 $27.60
======= ======= ======
Total return(%)......................... 12.29 12.85 (1.64)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $32,984 $13,020 $4,921
Ratio of expenses to average net assets( 1.34 1.35 1.41
Ratio of net investment income (loss) to
net assets(%).......................... 2.25 1.14 .47
Portfolio turnover rate(%).............. 16 6 7
Average commission rate................. $.0056 N/A N/A
</TABLE>

- ---------------

+ Since April 1, 1993, Ivy International Fund's subadviser has been Northern
Cross Investments Limited. In prior periods, Ivy International Fund had the
following subadvisers: Boston Overseas Investors, Inc., from July 1, 1990
through March 31, 1993; and Marsh & Cunningham, from November 15, 1985
through June 30, 1990.
(a) From October 23, 1993 (commencement of operations) to December 31, 1993.
(b) From October 6, 1994 (commencement) to December 31, 1994.
(c) For the six months ended June 30, 1996.
(d) From April 30, 1996 (commencement) to June 30, 1996.
(e) Net investment income is net of expenses reimbursed by IMI.
(f) The ratio of expenses to average net assets is net of expenses reimbursed by
IMI. If IMI had not reimbursed expenses during the year ended December 31,
1992, the ratio of expenses to average net assets would have been 1.80%.
(g) From May 1, 1986 (when first offered for public sale) to December 31, 1986.

* Unaudited.

10
<PAGE> 11

IVY LATIN AMERICA STRATEGY FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
------------------------------------ -----------------------------------
SELECTED PER SHARE DATA 1996(B)* 1995 1994(A) 1996(B)* 1995 1994(A)
-------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.88 $ 8.37 $10.00 $ 6.88 $ 8.37 $10.00
-------- ------- ------- ------- ------- -------
Loss from investment operations:
Net investment income (loss)(d)........... .05 .01 -- .02 (.02) (.01)
Net loss on investment transactions
(both realized and unrealized)........... 1.76 (1.45) (1.63) 1.75 (1.47) (1.62)
-------- ------- ------- ------- ------- -------
Total from investment operations....... 1.81 (1.44) (1.63) 1.77 (1.49) (1.63)
-------- ------- ------- ------- ------- -------
Less distributions:
From capital paid-in...................... -- .05 -- -- -- --
-------- ------- ------- ------- ------- -------
Total distributions.................... -- .05 -- -- -- --
-------- ------- ------- ------- ------- -------
Net asset value, end of period............... $ 8.69 $ 6.88 $ 8.37 $ 8.65 $ 6.88 $ 8.37
======== ======= ======= ======= ======= =======
Total return(%).............................. 26.31 (17.28) (16.10) 25.73 (17.90) (16.20)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $ 2,986 $ 2,015 $ 571 $1,411 $ 684 $ 122
Ratio of expenses to average net assets
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.20 2.20 2.20 2.95 2.95 2.95
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 5.97 9.26 16.22 6.72 10.01 16.97
Ratio of net investment income to average net
assets(%)(d)................................ 1.53 .22 .21 .78 (.53) (.54)
Portfolio turnover rate(%)................... 32 45 82 32 45 82
Average commission rate...................... $ .0001 N/A N/A $.0001 N/A N/A

CLASS C
--------
SELECTED PER SHARE DATA 1996(C)*
--------
<S> <C>
Net asset value, beginning of period......... $ 7.96
--------
Loss from investment operations:
Net investment income (loss)(d)........... .02
Net loss on investment transactions
(both realized and unrealized)........... .68
--------
Total from investment operations....... .70
--------
Less distributions:
From capital paid-in...................... --
--------
Total distributions.................... --
--------
Net asset value, end of period............... $ 8.66
========
Total return(%).............................. 8.92
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)..... $ 29
Ratio of expenses to average net assets
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.95
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 6.72
Ratio of net investment income to average net
assets(%)(d)................................ .78
Portfolio turnover rate(%)................... 32
Average commission rate...................... $.0001
</TABLE>

- ---------------

(a) From November 1, 1994 (commencement of operations) to December 31, 1994.
(b) For the six months ended June 30, 1996.
(c) From April 30, 1996 (commencement) to June 30, 1996.
(d) Net investment income (loss) is net of expenses reimbursed by IMI.
(e) Beginning in 1995, total expenses include fees paid indirectly through an
expense offset arrangement.

* Unaudited.

IVY NEW CENTURY FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
----------------------------------- -----------------------------------
SELECTED PER SHARE DATA 1996(B)* 1995 1994(A) 1996(B)* 1995 1994(A)
-------- ------ ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 9.05 $ 8.64 $10.00 $ 9.05 $ 8.64 $10.00
-------- ------ ------- ------- ------- -------
Income (loss) from investment operations:
Net investment income (loss)(d)........... .03 .01 -- -- (.02) --
Net gain (loss) on investment transactions
(both realized and unrealized)........... 1.13 .54 (1.36) 1.13 .51 (1.36)
-------- ------ ------- ------- ------- -------
Total from investment operations....... 1.16 .55 (1.36) 1.13 .49 (1.36)
-------- ------ ------- ------- ------- -------
Less distributions:
From net investment income................ -- .01 -- -- -- --
From net realized gain.................... -- .10 -- -- .08 --
In excess of net realized gain............ -- .03 -- -- -- --
-------- ------ ------- ------- ------- -------
Total distributions.................... -- .14 -- -- .08 --
-------- ------ ------- ------- ------- -------
Net asset value, end of period............... $ 10.21 $ 9.05 $ 8.64 $10.18 $ 9.05 $ 8.64
======== ====== ======= ======= ======= =======
Total return(%).............................. 12.82 6.40 (13.50) 12.49 5.62 (13.60)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands)..... $ 7,311 $3,435 $ 611 $3,574 $ 945 $ 121
Ratio of expenses to average net assets:
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.20 2.20 2.20 2.95 2.95 2.95
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 3.68 7.18 20.74 4.43 7.93 21.49
Ratio of net investment income to average net
assets(%)(d)................................ .81 .24 .52 .06 (.51) (.23)
Portfolio turnover rate(%)................... 28 14 0 28 14 0
Average commission rate...................... $ .0010 N/A N/A $.0010 N/A N/A

CLASS C
--------
SELECTED PER SHARE DATA 1996(C)*
--------
<S> <C>
Net asset value, beginning of period......... $ 9.89
--------
Income (loss) from investment operations:
Net investment income (loss)(d)........... --
Net gain (loss) on investment transactions
(both realized and unrealized)........... .30
--------
Total from investment operations....... .30
--------
Less distributions:
From net investment income................ --
From net realized gain.................... --
In excess of net realized gain............ --
--------
Total distributions.................... --
--------
Net asset value, end of period............... $10.19
========
Total return(%).............................. 3.03
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands)..... $ 62

Ratio of expenses to average net assets:
With expense reimbursement and fees paid
indirectly(%)(e).......................... 2.95
Without expense reimbursement and fees paid
indirectly(%)(e).......................... 4.43
Ratio of net investment income to average net
assets(%)(d)................................ .06
Portfolio turnover rate(%)................... 28
Average commission rate...................... $.0010
</TABLE>

- ---------------

* Unaudited.

11
<PAGE> 12

INVESTMENT OBJECTIVES AND POLICIES

Each Fund has its own investment objective and policies, which are described
below. Each Fund's investment objective is fundamental and may not be changed
without the approval of a majority of the outstanding voting shares of the Fund.
Except for a Fund's investment objective and those investment restrictions
specifically identified as fundamental, all investment policies and practices
described in this Prospectus and in the SAI are non-fundamental, and may be
changed by the Trustees without shareholder approval. There can be no assurance
that a Fund's objective will be met. The different types of securities and
investment techniques used by the Funds involve varying degrees of risk. For
information about the particular risks associated with each type of investment,
see "Risk Factors and Investment Techniques," below, and the SAI.

Whenever an investment objective, policy or restriction of a Fund described
in this Prospectus or in the SAI states a maximum percentage of assets that may
be invested in a security or other asset or describes a policy regarding quality
standards, that percentage limitation or standard will, unless otherwise
indicated, apply to the Fund only at the time a transaction takes place. Thus,
for example, if a percentage limitation is adhered to at the time of investment,
a later increase or decrease in the percentage that results from circumstances
not involving any affirmative action by the Fund will not be considered a
violation.

IVY ASIA PACIFIC FUND: The Fund's principal investment objective is long-
term growth. Consideration of current income is secondary to this principal
objective. Under normal circumstances the Fund invests at least 65% of its total
assets in securities issued in Asia-Pacific countries, which for purposes of
this Prospectus are defined to include China, Hong Kong, India, Indonesia,
Malaysia, Pakistan, the Philippines, Singapore, Sri Lanka, South Korea, Taiwan,
Thailand and Vietnam. Securities of Asia-Pacific issuers include: (a) securities
of companies organized under the laws of an Asia-Pacific country or for which
the principal securities trading market is in the Asia-Pacific region; (b)
securities that are issued or guaranteed by the government of an Asia-Pacific
country, its agencies or instrumentalities, political subdivisions or the
country's central bank; (c) securities of a company, wherever organized, where
at least 50% of the company's non-current assets, capitalization, gross revenue
or profit in any one of the two most recent fiscal years represents (directly or
indirectly through subsidiaries) assets or activities located in the
Asia-Pacific region; and (d) any of the preceding types of securities in the
form of depository shares.

The Fund may participate in markets throughout the Asia-Pacific region, and
it is expected that the Fund will be invested at all times in at least three
Asia-Pacific countries. The Fund does not expect to concentrate its investments
in any particular industry, but it may invest 25% or more of its total assets in
the securities of issuers located in any one Asia-Pacific country. See Appendix
C to the SAI for further information about the economic characteristics of
certain Asia-Pacific countries.

The Fund may invest up to 35% of its assets in investment-grade debt
securities of government or corporate issuers in emerging market countries,
investment-grade equity and debt securities of issuers in developed countries
(including the United States), warrants, and cash or cash equivalents, such as
bank obligations (including certificates of deposit and bankers' acceptances),
commercial paper, short-term notes and repurchase agreements. For temporary
defensive purposes, the Fund may invest without limit in such instruments. The
Fund may also invest up to 5% of its net assets in zero coupon bonds, and in
debt securities rated Ba or below by Moody's Investor Services, Inc. ("Moody's")
or BB or below by Standard and Poor's Corporation ("S&P"), or if unrated, are
considered by IMI to be of comparable quality (commonly referred to as "high
yield" or "junk" bonds).

For temporary or emergency purposes, the Fund may borrow up to one-third of
the value of its total assets from banks, but may not purchase securities at any
time during which the value of the Fund's outstanding loans exceeds 10% of the
value of the Fund's assets. The Fund may engage in foreign currency exchange
transactions and enter into forward foreign currency contracts. The Fund may
also invest (i) up to 10% of its total assets in other investment companies that
invest in securities issued in Asia-Pacific countries, and (ii) up to 15% of its
net assets in restricted and other illiquid securities.

The Fund may purchase put and call options on securities and stock indices,
provided the premium paid for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with respect to up to 10% of
the value of its net assets, and may write covered call options so long as not
more than 25% of the Fund's net assets is subject to being purchased upon the
exercise of the calls. For hedging purposes only, the Fund may engage in
transactions in stock index and foreign currency futures contracts, provided
that the Fund's aggregate investment in such contracts does not exceed 15% of
its total assets.

IVY CANADA FUND: Ivy Canada Fund seeks long-term capital appreciation by
investing primarily in equity securities of Canadian companies. Canada is one of
the world's leading industrial countries and a major exporter of agricultural
products. The country is rich in natural resources such as zinc, uranium,
nickel, gold, silver, aluminum, iron and copper, and forest covers over 44% of
land areas, making Canada a leading world producer of newsprint. Canada is also
a major producer of hydroelectricity, oil and gas.

As a fundamental policy, the Fund normally invests at least 65% of its total
assets in Canadian equity securities (i.e., common and preferred stock,
securities convertible into common stock and common stock purchase warrants)
listed on Canadian stock exchanges or traded over-the-counter in Canada.
Canadian issuers are companies (i) organized under the laws of Canada, (ii) for
which the principal securities trading market is in Canada, (iii) which derive
at least 50% of their revenues or profits from goods produced or sold,
investments made or services performed in Canada, or (iv) which have at least
50% of their assets situated in Canada. The balance of the Fund's assets
ordinarily are invested in (i) bills and bonds of the Canadian Government and
the governments of the provinces or municipalities of Canada, (ii) high quality
notes and debentures of Canadian companies (i.e., those rated Aaa or Aa by
Moody's or AAA or AA by S&P, or if unrated, judged to be of comparable quality
by Mackenzie Financial Corporation ("MFC"), the Fund's Adviser), (iii) foreign
securities (including sponsored or unsponsored American Depository Receipts
("ADRs"), Global Depository Receipts ("GDRs"), American Depository Shares
("ADSs") and Global Depository Shares ("GDSs")), (iv) U.S. Government
securities, (v) equity securities and investment-grade debt securities (i.e.,
those rated Baa or higher by Moody's or BBB or higher by S&P, or if unrated, are
considered by MFC to be of comparable quality) of U.S. companies, and (vi) zero
coupon bonds that meet these credit quality standards.

The Fund may purchase securities on a "when-issued" or firm commitment
basis, engage in currency exchange transactions and enter into forward foreign
currency contracts. The Fund may also invest (i) up to 10% of its total assets
in other investment companies and (ii) up to 15% of its net assets in restricted
and other illiquid securities.

For temporary defensive purposes, the Fund may invest without limit in U.S.
or Canadian dollar-denominated money market securities issued by

12
<PAGE> 13

entities organized in the U.S. or Canada, such as (i) obligations issued or
guaranteed by the Canadian Government or the governments of the provinces or
municipalities of Canada (or their agencies or instrumentalities), (ii) finance
company and corporate commercial paper (and other short-term corporate
obligations rated Prime-1 by Moody's or A or better by S&P, or if unrated,
considered by MFC to be of comparable quality), (iii) obligations of banks
(i.e., certificates of deposit, time deposits and bankers' acceptances)
considered creditworthy by MFC under guidelines approved by the Trust's Board of
Trustees, and (iv) repurchase agreements with broker-dealers and banks. For
temporary or emergency purposes, the Fund may also borrow up to 10% of the value
of its total assets from banks.

IVY CHINA REGION FUND: Ivy China Region Fund's principal investment
objective is long-term capital growth. Consideration of current income is
secondary to this principal objective. The Fund seeks to meet its objective
primarily by investing in the equity securities of companies that are expected
to benefit from the economic development and growth of China, Hong Kong and
Taiwan. A significant percentage of the Fund's assets may also be invested in
the securities markets of South Korea, Singapore, Malaysia, Thailand, Indonesia
and the Philippines (collectively, with China, Hong Kong and Taiwan, the "China
Region").

The Fund normally invests at least 65% of its total assets in "Greater China
growth companies," defined as companies (a) that are organized in or for which
the principal securities trading markets are the China Region; (b) that have at
least 50% of their assets in one or more China Region countries or derive at
least 50% of their gross sales revenues or profits from providing goods or
services to or from within one or more China Region countries; or (c) that have
at least 35% of their assets in China, Hong Kong or Taiwan, derive at least 35%
of their gross sales revenues or profits from providing goods or services to or
from within these three countries, or have significant manufacturing or other
operations in these countries. IMI's determination as to whether a company
qualifies as a Greater China growth company is based primarily on information
contained in financial statements, reports, analyses and other pertinent
information (some of which may be obtained directly from the company). The Fund
may invest 25% or more of its total assets in the securities of issuers located
in any one China Region country, and currently expects to invest more than 50%
of its total assets in Hong Kong. See Appendix C to the SAI for further
information about the economic characteristics of certain China Region
countries.

The balance of the Fund's assets ordinarily are invested in (i) certain
investment-grade debt securities and (ii) the equity securities of "China Region
associated companies," which are companies that do not meet the definition of a
Greater China growth company, but whose current or expected performance, based
on certain identified factors (such as the growth trends in the location of a
company's assets and the sources of its revenues and profits), is judged by IMI
to be strongly associated with the China Region. The investment-grade debt
securities in which the Fund may invest include (a) obligations of the U.S.
Government or its agencies or instrumentalities, (b) obligations of U.S. banks
and other banks organized and existing under the laws of Hong Kong, Taiwan or
countries that are members of the Organization for Economic Cooperation and
Development ("OECD"), and (c) obligations denominated in any currency issued by
international development institutions and Hong Kong, Taiwan and OECD member
governments and their agencies and instrumentalities, as well as repurchase
agreements with respect to any of the foregoing instruments. The Fund may also
invest in zero coupon bonds, and corporate bonds rated Baa or higher by Moody's
or BBB or higher by S&P (or if unrated, are considered by IMI to be of
comparable quality).

The Fund may invest less than 35% of its net assets in debt securities rated
Ba or below by Moody's or BB or below by S&P, or, if unrated, considered by IMI
to be of comparable quality (commonly referred to as "high yield" or "junk"
bonds). The Fund will not invest in debt securities rated less than C by either
Moody's or S&P. As of November 15, 1996, the Fund had 1.00% of its total assets
invested in low-rated debt securities.

The Fund may invest in sponsored or unsponsored ADRs, GDRs, ADSs and GDSs,
warrants, purchase securities on a "when-issued" or firm commitment basis,
engage in currency exchange transactions and enter into forward foreign currency
contracts. The Fund may also invest (i) up to 10% of its total assets in other
investment companies, and (ii) up to 15% of its net assets in restricted and
other illiquid securities.

For temporary defensive purposes and during periods when IMI believes that
circumstances warrant, the Fund may reduce its position in Greater China growth
companies and Greater China associated companies and increase its investment in
cash and liquid debt securities, such as U.S. Government securities, bank
obligations, commercial paper, short-term notes and repurchase agreements. For
temporary or emergency purposes, the Fund may also borrow up to 10% of the value
of its total assets from banks.

The Fund may purchase put and call options on securities and stock indices,
provided the premium paid for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with respect to up to 10% of
the value of its net assets, and may write covered call options so long as not
more than 25% of the Fund's net assets is subject to being purchased upon the
exercise of the calls. For hedging purposes only, the Fund may engage in
transactions in stock index futures contracts, provided that the Fund's
aggregate investment in such contracts does not exceed 15% of its total assets.

IVY GLOBAL FUND: The Fund seeks long-term capital growth through a flexible
policy of investing in stocks and debt obligations of companies and governments
of any nation. Any income realized will be incidental. Under normal conditions,
the Fund will invest at least 65% of its total assets in the common stock of
companies throughout the world, with at least three different countries (one of
which may be the United States) represented in the Fund's overall portfolio
holdings. Although the Fund generally invests in common stock, it may also
invest in preferred stocks, sponsored or unsponsored ADRs, GDRs, ADSs and GDSs,
and investment-grade debt securities (i.e., those rated Baa or higher by Moody's
or BBB or higher by S&P, or if unrated, are considered by IMI to be of
comparable quality), including corporate bonds, notes, debentures, convertible
bonds and zero coupon bonds.

The Fund may invest less than 35% of its net assets in debt securities rated
Ba or below by Moody's or BB or below by S&P, or if unrated, considered by IMI
to be of comparable quality (commonly referred to as "high yield" or "junk"
bonds). The Fund will not invest in debt securities rated less than C by either
Moody's or S&P. As of November 15, 1996, the Fund had 0.99% of its total assets
invested in low-rated debt securities.

The Fund may invest in equity real estate investment trusts, warrants,
purchase securities on a "when-issued" or firm commitment basis, engage in
currency exchange transactions and enter into forward foreign currency
contracts. The Fund may also invest (i) up to 10% of its total assets in other
investment companies and (ii) up to 15% of its net assets in restricted and
other illiquid securities.

13
<PAGE> 14

foreign commercial paper (which, if issued by a corporation, must be rated
Prime-1 by Moody's or A-1 by S&P, or if unrated has been issued by a company
that at the time of investment has an outstanding debt issue rated AAA or AA by
S&P or Aaa or Aa by Moody's). The Fund may also enter into repurchase
agreements, and, for temporary or emergency purposes, may borrow up to 10% of
the value of its total assets from banks.

The Fund may purchase put and call options stock indices, provided the
premium paid for such options does not exceed 10% of the Fund's net assets. The
Fund may also sell covered put options with respect to up to 50% of the value of
its net assets, and my write covered call options so long as not more than 20%
of the Fund's net assets is subject to being purchased upon the exercise of the
calls. For hedging purposes only, the Fund may engage in transactions in (and
options on) stock index and foreign currency futures contracts, provided that
the Fund's aggregate investment in such contracts does not exceed 20% of its
total assets.

IVY GLOBAL NATURAL RESOURCES FUND: The Fund's investment objective is
long-term growth. Any income realized will be incidental. Under normal
conditions, the Fund invests at least 65% of its total assets in the equity
securities of companies throughout the world that own, explore or develop
natural resources and other basic commodities, or supply goods and services to
such companies. Under this investment policy, at least three different countries
(one of which may be the United States) will be represented in the Fund's
overall portfolio holdings. "Natural resources" generally include precious
metals (such as gold, silver and platinum), ferrous and nonferrous metals (such
as iron, aluminum and copper), strategic metals (such as uranium and titanium),
coal, oil, natural gases, timber, undeveloped real property and agricultural
commodities. Although the Fund generally invests in common stock, it may also
invest in preferred stock, securities convertible into common stock and
sponsored or unsponsored ADRs, GDRs, ADSs and GDSs. The Fund may also invest
directly in precious metals and other physical commodities.

IMI believes that certain political and economic changes in the global
environment in recent years have had and will continue to have a profound effect
on global supply and demand of natural resources, and that rising demand from
developing markets and new sources of supply should create attractive investment
opportunities. In selecting the Fund's investments, IMI will seek to identify
securities of companies that, in IMI's opinion, appear to be undervalued
relative to the value of the companies' natural resource holdings.

For temporary defensive purposes, the Fund may invest without limit in cash
or cash equivalents, such as bank obligations (including certificates of deposit
and bankers' acceptances), commercial paper, short-term notes and repurchase
agreements. For temporary or emergency purposes, the Fund may borrow up to
one-third of the value of its total assets from banks, but may not purchase
securities at any time during which the value of the Fund's outstanding loans
exceeds 10% of the value of the Fund's total assets. The Fund may engage in
foreign currency exchange transactions and enter into forward foreign currency
contracts. The Fund may also invest (i) up to 10% of its total assets in other
investment companies and (ii) up to 15% of its net assets in restricted and
other illiquid securities.

For hedging purposes only, the Fund may engage in transactions in (and
options on) foreign currency futures contracts, provided that the Fund's
aggregate investment in such contracts does not exceed 15% of its total assets.

IVY GLOBAL SCIENCE & TECHNOLOGY FUND: The Fund's principal investment
objective is long-term capital growth. Any income realized will be incidental.
Under normal conditions, the Fund will invest at least 65% of its total assets
in the common stock of companies that are expected to benefit from the
development, advancement and use of science and technology. Under this
investment policy, at least three different countries (one of which may be the
United States) will be represented in the Fund's overall portfolio holdings.
Industries likely to be represented in the Fund's portfolio include computers
and peripheral products, software, electronic components and systems,
telecommunications, media and information services, pharmaceuticals, hospital
supply and medical devices, biotechnology, environmental services, chemicals and
synthetic materials, and defense and aerospace. The Fund may also invest in
companies that are expected to benefit indirectly from the commercialization of
technological and scientific advances. In recent years, rapid advances in these
industries have stimulated unprecedented growth. While this is no guarantee of
future performance, IMI believes that these industries offer substantial
opportunities for long-term capital appreciation.

Although the Fund generally invests in common stock, it may also invest in
preferred stock, securities convertible into common stock, sponsored or
unsponsored ADRs, GDRs, ADSs and GDSs and investment-grade debt securities
(i.e., those rated Baa or higher by Moody's or BBB or higher by S&P, or if
unrated, are considered by IMI to be of comparable quality), including corporate
bonds, notes, debentures, convertible bonds and zero-coupon bonds. The Fund may
also invest up to 5% of its net assets in debt securities that are rated Ba or
below by Moody's or BB or below by S&P, or if unrated, are considered by IMI to
be of comparable quality (commonly referred to as "high yield" or "junk" bonds).
The Fund will not invest in debt securities rated less than C by either Moody's
or S&P. (A description of the ratings assigned by Moody's and S&P is contained
in Appendix A to the SAI).

For temporary defensive purposes and during periods when IMI believes that
circumstances warrant, the Fund may invest without limit in U.S. Government
securities, obligations issued by domestic or foreign banks (including
certificates of deposit, time deposits and bankers' acceptances), and domestic
or foreign commercial paper (which, if issued by a corporation, must be rated
Prime-1 by Moody's or A-1 by S&P, or if unrated has been issued by a company
that at the time of investment has an outstanding debt issue rated AAA or AA by
S&P or Aaa or Aa by Moody's). The Fund may also enter into repurchase
agreements, and, for temporary or emergency purposes, may borrow up to 10% of
the value of its total assets from banks.

The Fund may purchase put and call options on stock indices and on
individual securities, provided the premium paid for such options does not
exceed 10% of the value of the Fund's net assets. The Fund may also sell covered
put options with respect to up to 50% of the value of its net assets, and may
sell covered call options so long as not more than 20% of the Fund's net assets
is subject to being purchased upon the exercise of the calls. For hedging
purposes only, the Fund may engage in transactions in (and options on) stock
index and foreign currency futures contracts, provided that the Fund's aggregate
investment in such contracts does not exceed 20% of the value of its total
assets.

14
<PAGE> 15

securities convertible into common stocks) principally traded in European,
Pacific Basin and Latin American markets. Under this investment policy, at least
three different countries (other than the United States) will be represented in
the Fund's overall portfolio holdings. For temporary defensive purposes, the
Fund may also invest in equity securities principally traded in U.S. markets.
The Fund's subadviser, Northern Cross Investments Limited ("Northern Cross"),
invests the Fund's assets in a variety of economic sectors, industry segments
and individual securities in order to reduce the effects of price volatility in
any one area and to enable shareholders to participate in markets that do not
necessarily move in concert with U.S. markets. Northern Cross seeks to identify
rapidly expanding foreign economies, and then searches out growing industries
and corporations, focusing on companies with established records. Individual
securities are selected based on value indicators, such as a low price-earnings
ratio, and are reviewed for fundamental financial strength. Companies in which
investments are made will generally have at least $1 billion in capitalization
and a solid history of operations.

When economic or market conditions warrant, the Fund may invest without
limit in U.S. Government securities, investment-grade debt securities (i.e.,
those rated Baa or higher by Moody's or BBB or higher by S&P, or if unrated, are
considered by Northern Cross to be of comparable quality), preferred stocks,
sponsored or unsponsored ADRs, GDRs, ADSs and GDSs, warrants, or cash or cash
equivalents such as bank obligations (including certificates of deposit and
bankers' acceptances), commercial paper, short-term notes and repurchase
agreements. For temporary or emergency purposes, the Fund may borrow up to 10%
of the value of its total assets from banks. The Fund may also purchase
securities on a "when-issued" or firm commitment basis, and may engage in
currency exchange transactions and enter into forward foreign currency
contracts. The Fund may also invest (i) up to 10% of its total assets in other
investment companies and (ii) up to 15% of its net assets in restricted and
other illiquid securities.

The Fund may purchase put and call options on securities and stock indices,
provided the premium paid for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with respect to up to 10% of
the value of its net assets, and may write covered call options so long as not
more than 25% of the Fund's net assets is subject to being purchased upon the
exercise of the calls. For hedging purposes only, the Fund may engage in
transactions in (and options on) stock index and foreign currency futures
contracts, provided that the Fund's aggregate investment in such contracts does
not exceed 15% of its total assets.

IVY INTERNATIONAL SMALL COMPANIES FUND: The Fund's principal investment
objective is long-term growth primarily through investment in foreign equity
securities. Consideration of current income is secondary to this principal
objective. Under normal circumstances the Fund invests at least 65% of its total
assets in common and preferred stocks (and securities convertible into common
stocks) of foreign issuers having total market capitalization of less than $1
billion. Under this investment policy, at least three different countries (other
than the United States) will be represented in the Fund's overall portfolio
holdings. For temporary defensive purposes, the Fund may also invest in equity
securities principally traded in the United States. The Fund will invest its
assets in a variety of economic sectors, industry segments and individual
securities in order to reduce the effects of price volatility in any area and to
enable shareholders to participate in markets that do not necessarily move in
concert with the U.S. market. The factors that IMI considers in determining the
appropriate distribution of investments among various countries and regions
include prospects for relative economic growth, expected levels of inflation,
government policies influencing business conditions and the outlook for currency
relationships.

In selecting the Fund's investments, IMI will seek to identify securities
that are attractively priced relative to their intrinsic value. The intrinsic
value of a particular security is analyzed by reference to characteristics such
as relative price/earnings ratio, dividend yield and other relevant factors
(such as applicable financial, tax, social and political conditions).

When economic or market conditions warrant, the Fund may invest without
limit in U.S. Government securities, investment-grade debt securities, zero
coupon bonds, preferred stocks, warrants, or cash or cash equivalents such as
bank obligations (including certificates of deposit and bankers' acceptances),
commercial paper, short-term notes and repurchase agreements. The Fund may also
invest up to 5% of its net assets in debt securities rated Ba or below by
Moody's or BB or below by S&P, or if unrated, are considered by IMI to be of
comparable quality (commonly referred to as "high yield" or "junk" bonds).

For temporary or emergency purposes, the Fund may borrow up to one-third of
the value of its total assets from banks, but may not purchase securities at any
time during which the value of the Fund's outstanding loans exceeds 10% of the
value of the Fund's assets. The Fund may engage in foreign currency exchange
transactions and enter into forward foreign currency contracts. The Fund may
also invest (i) up to 10% of its total assets in other investment companies and
(ii) up to 15% of its net assets in restricted and other illiquid securities.

IVY LATIN AMERICA STRATEGY FUND: The Fund's principal investment objective
is long-term capital growth. Consideration of current income is secondary to
this principal objective. Under normal conditions the Fund invests at least 65%
of its total assets in securities issued in Latin America, which for purposes of
this Prospectus is defined as Mexico, Central America, South America and the
Spanish-speaking islands of the Caribbean. Securities of Latin American issuers
include (a) securities of companies organized under the laws of a Latin American
country or for which the principal securities trading market is in Latin
America; (b) securities that are issued or guaranteed by the government of a
Latin American country, its agencies or instrumentalities, political
subdivisions or the country's central bank; (c) securities of a company,
wherever organized, where at least 50% of the company's non-current assets,
capitalization, gross revenue or profit in any one of the two most recent fiscal
years represents (directly or indirectly through subsidiaries) assets or
activities located in Latin America; or (d) any of the preceding types of
securities in the form of depository shares. The Fund may participate in markets
throughout Latin America, and it is expected that the Fund will be invested at
all times in at least three countries. Under present conditions, the Fund
expects to focus its investments in Argentina, Brazil, Chile, Mexico and
Venezuela, which IMI believes are the most developed capital markets in Latin
America. The Fund does not expect to concentrate its investments in any
particular industry.

15
<PAGE> 16

through rights). The Fund's equity securities may be listed on securities
exchanges, traded over-the-counter, or have no organized market.

The Fund may invest in debt securities (including zero coupon bonds) when
IMI anticipates that the potential for capital appreciation from debt securities
is likely to equal or exceed that of equity securities (e.g., a favorable change
in relative foreign exchange rates, interest rate levels or the creditworthiness
of issuers). These include debt securities issued by Latin American Governments
("Sovereign Debt"). Most of the debt securities in which the Fund may invest are
not rated, and those that are rated are expected to be below investment-grade
(i.e., rated Ba or below by Moody's or BB or below by S&P, or considered by IMI
to be of comparable quality), and are commonly referred to as "high yield" or
"junk" bonds. As of November 15, 1996, the Fund had 0.67% of its total assets
invested in low-rated debt securities.

To meet redemptions, or while the Fund is anticipating investments in Latin
American securities, the Fund may hold cash or cash equivalents such as bank
obligations (including certificates of deposit and bankers' acceptances),
commercial paper, short-term notes and repurchase agreements. For temporary
defensive or emergency purposes, the Fund may (i) invest without limit in such
instruments, and (ii) borrow up to one-third of the value of its total assets
from banks (but may not purchase securities at any time during which the value
of the Fund's outstanding loans exceeds 10% of the value of the Fund's total
assets).

The Fund may invest in warrants, purchase securities on a "when-issued" or
firm commitment basis, engage in currency exchange transactions and enter into
forward foreign currency contracts. The Fund may also invest (i) up to 10% of
its total assets in other investment companies, and (ii) up to 15% of its net
assets in restricted and other illiquid securities. The Fund will treat any
Latin American securities that are subject to restrictions on repatriation for
more than seven days, as well as any securities issued in connection with Latin
American debt conversion programs that are restricted to remittance of invested
capital or profits, as illiquid securities for purposes of this limitation.

The Fund may purchase put and call options on securities and stock indices,
provided the premium paid for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with respect to up to 10% of
the value of its net assets, and my write covered call options so long as not
more than 25% of the Fund's net assets is subject to being purchased upon the
exercise of the calls. For hedging purposes only, the Fund may engage in
transactions in (and options on) stock index and foreign currency futures
contracts, provided that the Fund's aggregate investment in such contracts does
not exceed 15% of its total assets.

IVY NEW CENTURY FUND: The Fund's principal objective is long-term growth.
Consideration of current income is secondary to this principal objective. In
pursuing its objective, the Fund invests primarily in the equity securities of
companies that IMI believes will benefit from the economic development and
growth of emerging markets. The Fund considers countries having emerging markets
to be those that (i) are generally considered to be "developing" or "emerging"
by the World Bank and the International Finance Corporation, or (ii) are
classified by the United Nations (or otherwise regarded by their authorities) as
"emerging." Under normal market conditions, the Fund invests at least 65% of its
total assets in equity securities (including common and preferred stocks,
convertible debt obligations, warrants, options, rights, and sponsored or
unsponsored ADRs, GDRs, ADSs and GDSs that are listed on stock exchanges or
traded over-the-counter) of "Emerging Market growth companies," which are
defined as companies (a) for which the principal securities trading market is an
emerging market (as defined above), (b) that (alone or on a consolidated basis)
derives 50% or more of its total revenue either from goods, sales or services in
emerging markets, or (c) that are organized under the laws of (and with a
principal office in) an emerging market country.

The Fund normally invests its assets in the securities of issuers located in
at least three emerging market countries, and may invest 25% or more of its
total assets in the securities of issuers located in any one country. IMI's
determination as to whether a company qualifies as a Emerging Markets growth
company is based primarily on information contained in financial statements,
reports, analyses and other pertinent information (some of which may be obtained
directly from the company).

For purposes of capital appreciation, the Fund may invest up to 35% of its
assets in (i) debt securities of government or corporate issuers in emerging
market countries, (ii) equity and debt securities of issuers in developed
countries (including the United States), and (iii) cash or cash equivalents such
as bank obligations (including certificates of deposit and bankers'
acceptances), commercial paper, short-term notes and repurchase agreements. For
temporary defensive purposes, the Fund may invest without limit in such
instruments. The Fund may also invest in zero coupon bonds and purchase
securities on a "when-issued" or firm commitment basis.

The Fund will not invest more than 20% of its total assets in debt
securities rated Ba or lower by Moody's or BB or lower by S&P, or if unrated,
are considered by IMI to be of comparable quality (commonly referred to as "high
yield" or "junk" bonds). As of November 15, 1996, the Fund had 0.65% of its
total assets invested in low-rated debt securities.

For temporary or emergency purposes, the Fund may borrow up to one-third of
the value of its total assets from banks, but may not purchase securities at any
time during which the value of the Fund's outstanding loans exceeds 10% of the
value of the Fund's assets. The Fund may engage in currency exchange
transactions and enter into forward foreign currency contracts. The Fund may
also invest (i) up to 10% of its total assets in other investment companies, and
(ii) up to 15% of its net assets in restricted and other illiquid securities.
Securities whose proceeds are subject to limitations on repatriation of
principal or profits for more than seven days, and those for which market
quotations are not readily available, may be deemed illiquid for these purposes.

The Fund may purchase put and call options on securities and stock indices,
provided the premium paid for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with respect to up to 10% of
the value of its net assets, and my write covered call options so long as not
more than 25% of the Fund's net assets is subject to being purchased upon the
exercise of the calls. For hedging purposes only, the Fund may engage in
transactions in (and options on) stock index and foreign currency futures
contracts, provided that the Fund's aggregate investment in such contracts does
not exceed 15% of its total assets.

RISK FACTORS AND INVESTMENT TECHNIQUES

SPECIAL CONSIDERATIONS RELATED TO IVY ASIA PACIFIC FUND: Certain Asia-
Pacific countries in which the Fund may invest are developing countries, and may
be in the initial stages of their industrialization cycle. The economic
structures of developing countries generally are less diverse and mature than in
the United States, and their political systems may be relatively unstable.
Historically, markets of developing countries have been more volatile than the
markets of developed countries, yet such markets often have provided higher
rates of return to investors.

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Investing in securities of issuers in Asia-Pacific countries involves
certain considerations not typically associated with investing in securities of
United States companies, including (i) restrictions on foreign investment and on
repatriation of capital invested in Asian countries, (ii) currency fluctuations,
(iii) the cost of converting foreign currency into United States dollars, (iv)
potential price volatility and lesser liquidity of shares traded on Asia-Pacific
country securities markets and (v) political and economic risks, including the
risk of nationalization or expropriation of assets and the risk of war.

Certain Asia-Pacific countries may be more vulnerable to the ebb and flow of
international trade and to trade barriers and other protectionist or retaliatory
measures. Investments in countries such as China that have recently opened their
capital markets and that appear to have relaxed their central planning
requirement, as well as in countries that have privatized some of their state-
owned industries, should be regarded as speculative.

The settlement period of securities transactions in foreign markets in
general may be longer than in domestic markets, and such delays may be of
particular concern in developing countries. For example, the possibility of
political upheaval and the dependence on foreign economic assistance may be
greater in developing countries than in developed countries, either one of which
may increase settlement delays.

Securities exchanges, issuers and broker-dealers in some Asia-Pacific
countries are subject to less regulatory scrutiny than in the United States. In
addition, due to the limited size of the markets for Asia-Pacific securities,
the prices for such securities may be more vulnerable to adverse publicity,
investors' perceptions or traders' positions or strategies, which could cause a
decrease not only in the value but also in the liquidity of the Fund's
investments.

SPECIAL CONSIDERATIONS RELATED TO IVY CANADA FUND: The economy of Canada is
strongly influenced by the activities of companies involved in the production
and processing of natural resources, particularly those involved in the energy
industry, industrial materials (e.g., chemicals, base metals, timber and paper)
and agricultural materials (e.g., grain cereals). The securities of companies in
the energy industry are subject to changes in value and dividend yield, which
depend, to a large extent, on the price and supply of energy fuels. Rapid price
and supply fluctuations may be caused by events relating to international
politics, energy conservation and the success of exploration projects.

SPECIAL CONSIDERATIONS RELATED TO IVY CHINA REGION FUND: Investors should
realize that China Region countries may be subject to a greater degree of
economic, political and social instability than is the case in the United States
or other developed countries. Among the factors causing this instability are (i)
authoritarian governments or military involvement in political and economic
decision making, (ii) popular unrest associated with demands for improved
political, economic and social conditions, (iii) internal insurgencies, (iv)
hostile relations with neighboring countries, (v) ethnic, religious and racial
disaffection, and (vi) changes in trading status, any one of which could disrupt
the principal financial markets in which the Fund invests and adversely affect
the value of its assets. In addition, several China Region countries have had
hostile relations with neighboring nations. For example, China continues to
claim sovereignty over Taiwan, and is scheduled to assume sovereignty over Hong
Kong in 1997.

China Region countries tend to be heavily dependent on international trade,
as a result of which their markets are highly sensitive to protective trade
barriers and the economic conditions of their principal trading partners (i.e.,
the United States, Japan and Western European countries). Protectionist trade
legislation, reduction of foreign investment in China Region economies and
general declines in the international securities markets could have a
significant adverse effect on the China Region securities markets. In addition,
certain China Region countries have in the past failed to recognize private
property rights and have at times nationalized or expropriated the assets of
private companies. There is a heightened risk in these countries that such
adverse actions might be repeated.

To take advantage of potential growth opportunities, the Fund might have
significant investments in companies with relatively small market
capitalization. Securities of smaller companies may be subject to more abrupt or
erratic market movements than the securities of larger more established
companies, both because they tend to be traded in lower volume and because the
companies are subject to greater business risk. In addition, to the extent that
any China Region country experiences rapid increases in its money supply or
investment in equity securities for speculative purposes, the equity securities
traded in such countries may trade at price-earning multiples higher than those
of comparable companies trading on securities markets in the United States,
which may not be sustainable. Finally, restrictions on foreign investment exists
to varying degrees in some China Region countries. Where such restrictions
apply, investments may be limited and may increase the Fund's expenses. The SAI
contains additional information concerning the risks associated with investing
in the China Region.

SPECIAL CONSIDERATIONS RELATED TO IVY GLOBAL SCIENCE & TECHNOLOGY FUND, IVY
INTERNATIONAL SMALL COMPANIES FUND AND IVY NEW CENTURY FUND: In light of Ivy New
Century Fund's concentration in equity securities of Emerging Market growth
companies (as defined above), an investment in the Fund should be considered
speculative. In addition, both Ivy Global Science & Technology Fund and Ivy
International Small Companies Fund are expected to have significant investments
in companies with relatively small market capitalization. Securities of smaller
companies may be subject to more abrupt or erratic market movements than the
securities of larger more established companies, both because they tend to be
traded in lower volume and because the companies are subject to greater business
risk.

Because Ivy Global Science & Technology Fund normally focuses its
investments in science and technology-related industries, the value of the
Fund's shares may be more susceptible to factors affecting those industries and
to greater market fluctuation than a fund whose portfolio holdings are more
diverse. For example, rapid advances in these industries tend to render existing
products obsolete. In addition, many companies in which the Fund is likely to
invest are subject to government regulations and approval of their products and
services, which may affect their overall profitability and cause their stock
prices to be more volatile. In selecting the Fund's portfolio of investments,
IMI will consider each company's ability to create new products, secure any
necessary regulatory approvals, and generate sufficient customer demand. A
company's failure to perform well in any one of these areas, however, could
cause its stock to decline sharply.

SPECIAL CONSIDERATIONS RELATED TO IVY GLOBAL NATURAL RESOURCES FUND: Since
the Fund normally invests a substantial portion of its assets in securities of
companies engaged in natural resources activities, the Fund may be subject to
greater risks and market fluctuations than funds with more diversified
portfolios. The value of the Fund's securities will fluctuate in response to
market conditions generally, and will be particularly sensitive to the markets
for those natural resources in which a particular issuer is involved. The values
of natural resources may also fluctuate directly with respect to real and
perceived inflationary trends and various political developments. In addition,
many natural resource companies have been subject to significant costs
associated with compliance with environmental and other safety regulations. In
selecting the

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Fund's portfolio of investments, IMI will consider each company's ability to
create new products, secure any necessary regulatory approvals, and generate
sufficient customer demand. A company's failure to perform well in any one of
these areas, however, could cause its stock to decline sharply.

The Fund's investments in precious metals (such as gold) and other physical
commodities are subject to special risk considerations, including substantial
price fluctuations over short periods of time. On the other hand, investments in
precious metals coins or bullion could help to moderate fluctuations in the
value of the Fund's portfolio, since the prices of precious metals have at times
tended not to fluctuate as widely as shares of issuers engaged in the mining of
precious metals. Because precious metals and other commodities do not generate
investment income, however, the return on such investments will be derived
solely from the appreciation and depreciation on such investments. The Fund may
also incur storage and other costs relating to its investments in precious
metals and other commodities, which may, under certain circumstances, exceed
custodial and brokerage costs associated with investments in other types of
securities. When the Fund purchases a precious metal, IMI currently intends that
it will only be in a form that is readily marketable.

SPECIAL CONSIDERATIONS RELATED TO IVY LATIN AMERICA STRATEGY FUND: The
securities markets of Latin American countries are substantially smaller, less
developed, less liquid and more volatile than the major securities markets in
the United States. This could cause prices to be erratic for reasons apart from
factors that affect the quality of the securities. For example, limited market
size may cause prices to be unduly influenced by traders who control large
positions. Adverse publicity and investor perception, whether or not based on
fundamental analysis, may decrease the value and liquidity of portfolio
securities, especially in these markets.

For many years, most Latin American countries have experienced substantial
(and in some periods extremely high) rates of inflation, which have had and may
continue to have very negative effects on the economies and securities markets
of these countries. In addition, certain Latin American countries are among the
largest debtors to commercial banks and foreign governments, and some have
declared moratoria on the payment of principal and/or interest on external debt.
Accordingly, the Sovereign Debt instruments in which the Fund may invest involve
a high degree of risk and should be considered equivalent in quality to debt
securities rated below investment-grade by Moody's and S&P.

The Fund is classified as a non-diversified investment company under the
1940 Act, and therefore may invest, with respect to 50% of its total assets,
more than 5% of its total assets in the securities of any one issuer.
Consequently, the performance of a single issuer in which the Fund has invested
may have a more significant effect on the overall performance of the Fund than
if the Fund was a diversified company.

BANK OBLIGATIONS: The bank obligations in which the Funds may invest
include certificates of deposit, bankers' acceptances, and other short-term debt
obligations. Investments in certificates of deposit and bankers' acceptances are
limited to obligations of (i) banks having total assets in excess of $1 billion,
and (ii) other banks if the principal amount of the obligation is fully insured
by the Federal Deposit Insurance Corporation ("FDIC"). Investments in
certificates of deposit of savings associations are limited to obligations of
Federal or state-chartered institutions whose total assets exceed $1 billion and
whose deposits are insured by the FDIC.

BORROWING: Borrowing may exaggerate the effect on a Fund's net asset value
of any increase or decrease in the value of the Fund's portfolio securities.
Money borrowed will be subject to interest costs (which may include commitment
fees and/or the cost of maintaining minimum average balances).

COMMERCIAL PAPER: Commercial paper represents short-term unsecured
promissory notes issued in bearer form by bank holding companies, corporations,
and finance companies. Each Fund's investments in commercial paper are limited
to obligations rated A-1 by S&P or Prime-1 by Moody's, or if not rated, are
issued by companies having an outstanding debt issue currently rated Aaa or Aa
by Moody's or AAA or AA by S&P.

CONVERTIBLE SECURITIES: The convertible securities in which the Funds may
invest include corporate bonds, notes, debentures and other securities
convertible into common stocks. Because convertible securities can be converted
into equity securities, their values will normally vary in some proportion with
those of the underlying equity securities. Convertible securities usually
provide a higher yield than the underlying equity, however, so that the price
decline of a convertible security may sometimes be less substantial than that of
the underlying equity security.

DEBT SECURITIES, IN GENERAL: Investment in debt securities, including
municipal securities, involves both interest rate and credit risk. Generally,
the value of debt instruments rises and falls inversely with fluctuations in
interest rates. As interest rates decline, the value of debt securities
generally increases. Conversely, rising interest rates tend to cause the value
of debt securities to decrease. Bonds with longer maturities generally are more
volatile than bonds with shorter maturities. The market value of debt securities
also varies according to the relative financial condition of the issuer. In
general, lower-quality bonds offer higher yields due to the increased risk that
the issuer will be unable to meet its obligations on interest or principal
payments at the time called for by the debt instrument.

U.S. GOVERNMENT SECURITIES: U.S. Government securities are obligations of,
or guaranteed by, the U.S. Government, its agencies or instrumentalities. Such
securities include: (1) direct obligations of the U.S. Treasury (such as
Treasury bills, notes, and bonds) and (2) Federal agency obligations guaranteed
as to principal and interest by the U.S. Treasury (such as GNMA certificates,
which are mortgage-backed securities). When such securities are held to
maturity, the payment of principal and interest is unconditionally guaranteed by
the U.S. Government, and thus they are of the highest possible credit quality.
U.S. Government securities that are not held to maturity are subject to
variations in market value caused by fluctuations in interest rates.

Mortgage-backed securities are securities representing part ownership of a
pool of mortgage loans. Although the mortgage loans in the pool will have
maturities of up to 30 years, the actual average life of the loans typically
will be substantially less because the mortgages will be subject to principal
amortization and may be prepaid prior to maturity. In periods of falling
interest rates, the rate of prepayment tends to increase, thereby shortening the
actual average life of the security. Conversely, rising interest rates tend to
decrease the rate of prepayment, thereby lengthening the security's actual
average life (and increasing the security's price volatility). Since it is not
possible to predict accurately the average life of a particular pool, and
because prepayments are reinvested at current rates, the market value of
mortgage-backed securities may decline during periods of declining interest
rates.

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INVESTMENT-GRADE DEBT SECURITIES: Bonds rated Aaa by Moody's and AAA by S&P
are judged to be of the best quality (i.e., capacity to pay interest and repay
principal is extremely strong). Bonds rated Aa/AA are considered to be of high
quality (i.e., capacity to pay interest and repay principal is very strong and
differs from the highest rated issues only to a small degree). Bonds rated A are
viewed as having many favorable investment attributes, but elements may be
present that suggest a susceptibility to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.
Bonds rated Baa/BBB (considered by Moody's to be "medium grade" obligations) are
considered to have an adequate capacity to pay interest and repay principal, but
certain protective elements may be lacking (i.e., such bonds lack outstanding
investment characteristics and have some speculative characteristics).

LOW-RATED DEBT SECURITIES: Securities rated lower than Baa or BBB, and
comparable unrated securities (commonly referred to as "high yield" or "junk"
bonds), are considered by major credit-rating organizations to have
predominately speculative characteristics with respect to the issuer's capacity
to pay interest and repay principal. Investors in those Funds that invest in
these securities, should be willing to accept the special risks associated with
these securities.

While high yield debt securities are likely to have some quality and
protective characteristics, these qualities are largely outweighed by the risk
of exposure to adverse conditions and other uncertainties. Accordingly,
investments in such securities, while generally providing for greater income and
potential opportunity for gain than investments in higher-rated securities, also
entail greater risk (including the possibility of default or bankruptcy of the
issuer of such securities) and generally involve greater price volatility than
securities in higher rating categories. IMI seeks to reduce risk through
diversification (including investments in foreign securities), credit analysis
and attention to current developments and trends in both the economy and
financial markets. Should the rating of a portfolio security be downgraded, IMI
will determine whether it is in the affected Fund's best interest to retain or
dispose of the security (unless the security is downgraded below the rating of
C, in which case IMI most likely would dispose of the security based on then
existing market conditions). For additional information regarding the risks
associated with investing in high yield bonds, see the SAI (and, in particular,
Appendix A, which contains a more complete description of the ratings assigned
by Moody's and S&P).

FOREIGN SECURITIES: The foreign securities in which the Funds invest may
include non-U.S. dollar-denominated securities, Eurodollar securities, sponsored
or unsponsored ADRs, GDRs, ADSs and GDSs, and debt securities issued, assumed or
guaranteed by foreign governments (or political subdivisions or
instrumentalities thereof). Investors should consider carefully the special
risks that arise in connection with investing in securities issued by companies
and governments of foreign nations, which are in addition to those risks that
are associated with the Funds' investments, generally.

In many foreign countries, there is less regulation of business and industry
practices, stock exchanges, brokers and listed companies than in the United
States. For example, foreign companies are not generally subject to uniform
accounting and financial reporting standards, and foreign securities
transactions may be subject to higher brokerage costs. There also tends to be
less publicly available information about issuers in foreign countries, and
foreign securities markets of many of the countries in which the Funds may
invest may be smaller, less liquid and subject to greater price volatility than
those in the United States. Generally, price fluctuations in the Funds' foreign
security holdings are likely to be high relative to those of securities issued
in the United States.

Other risks include the possibility of expropriation, nationalization or
confiscatory taxation, foreign exchange controls (which may include suspension
of the ability to transfer currency from a given country), difficulties in
pricing, default in foreign government securities, high rates of inflation,
difficulties in enforcing foreign judgments, political or social instability, or
other developments that could adversely affect the Funds' foreign investments.

The risks of investing in foreign securities (described above) are likely to
be intensified in the case of investments in issuers domiciled or doing
substantial business in countries with emerging or developing economies
("emerging markets"). For example, countries with emerging markets may have
relatively unstable governments and therefore be susceptible to sudden adverse
government action (such as nationalization of businesses, restrictions on
foreign ownership or prohibitions against repatriation of assets). Security
prices in emerging markets can also be significantly more volatile than in the
more developed nations of the world, and communications between the U.S. and
emerging market countries may be unreliable, increasing the risk of delayed
settlements of portfolio transactions or loss of certificates for portfolio
securities. Delayed settlements could cause a Fund to miss attractive investment
opportunities or impair its ability to dispose of portfolio securities,
resulting in a loss if the value of the securities subsequently declines. In
addition, many emerging markets have experienced and continue to experience
especially high rates of inflation. In certain countries, inflation has at times
accelerated rapidly to hyperinflationary levels, creating a negative interest
rate environment and sharply eroding the value of outstanding financial assets
in those countries.

In recent years, many emerging market countries around the world have
undergone political changes that have reduced government's role in economic and
personal affairs and have stimulated investment and growth. In order for these
emerging economies to continue to expand and develop industry, infrastructure
and currency reserves, continued influx of capital is essential. Historically,
there is a strong direct correlation between economic growth and stock market
returns. While this is no guarantee of future performance, IMI believes that
investment opportunities (particularly in the energy, environmental services,
natural resources, basic materials, power, telecommunications and transportation
industries) may result within the evolving economies of emerging market
countries from which the Funds and their shareholders will benefit. IMI believes
that similar investment opportunities will be created for companies involved in
providing consumer goods and services (e.g., food, beverages, autos, housing,
tourism and leisure and merchandising).

FOREIGN CURRENCY EXCHANGE TRANSACTIONS: A Fund usually effects its currency
exchange transactions on a spot (i.e., cash) basis at the spot rate prevailing
in the foreign exchange market. However, some price spread on currency exchange
(e.g., to cover service charges) is usually incurred when a Fund converts assets
from one currency to another. A Fund may also be affected unfavorably by
fluctuations in the relative rates of exchange between the currencies of
different nations.

FORWARD FOREIGN CURRENCY CONTRACTS: A forward foreign currency contract
involves an obligation to purchase or sell a specific currency at a future date
at a predetermined price. Although these contracts are intended to minimize the
risk of loss due to a decline in the value of the hedged currencies, they also
tend to limit any potential gain that might result should the value of the
currencies increase. In addition, there may be an imperfect correlation between
a Fund's portfolio holdings of securities denominated in a particular

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currency and forward contracts entered into by the Fund, which may prevent the
Fund from achieving the intended hedge or expose the Fund to the risk of
currency exchange loss.

OPTIONS AND FUTURES TRANSACTIONS: The Funds may use various techniques to
increase or decrease their exposure to changing security prices, currency
exchange rates, commodity prices, or other factors that affect the value of the
Funds' securities. These techniques may involve derivative transactions such as
purchasing put and call options, selling put and call options, and engaging in
transactions in currency rate futures, stock index futures and related options.

A Fund may invest in options on securities in accordance with its stated
investment objective and policies (see above). A put option is a short-term
contract that gives the purchaser of the option, in return for a premium, the
right to sell the underlying security or currency to the seller of the option at
a specified price during the term of the option. A call option is a short-term
contract that gives the purchaser the right to buy the underlying security or
currency from the seller of the option at a specified price during the term of
the option. An option on a stock index gives the purchaser the right to receive
from the seller cash equal to the difference between the closing price of the
index and the exercise price of the option.

A Fund may also enter into futures transactions in accordance with its
stated investment objective and policies. An interest rate futures contract is
an agreement between two parties to buy or sell a specified debt security at a
set price on a future date. A stock index futures contract is an agreement to
take or make delivery of an amount of cash based on the difference between the
value of the index at the beginning and at the end of the contract period.

Investors should be aware that the risks associated with the use of options
and futures are considerable. Options and futures transactions generally involve
a small investment of cash relative to the magnitude of the risk assumed, and
therefore could result in a significant loss to a Fund if IMI judges market
conditions incorrectly or employs a strategy that does not correlate well with
the Fund's investments. A Fund may also experience a significant loss if it is
unable to close a particular position due to the lack of a liquid secondary
market. For further information regarding the use of options and futures
transactions and any associated risks, see the SAI.

PRECIOUS METALS AND OTHER PHYSICAL COMMODITIES: Investors in Ivy Global
Natural Resources Fund should be aware that commodities trading is generally
considered a speculative activity. For example, prices of precious metals are
affected by factors such as cyclical economic conditions, political events and
monetary policies of various countries. Accordingly, markets for precious metals
may at times be volatile and there may be sharp price fluctuations even during
periods when prices overall are rising. Investments in physical commodities may
also present practical problems of delivery, storage and maintenance, possible
illiquidity, the unavailability of accurate market valuations and increased
expenses.

REAL ESTATE INVESTMENT TRUSTS: A real estate investment trust ("REIT") is a
corporation, trust or association that invests in real estate mortgages or
equities for the benefit of its investors. REITs are dependent upon management
skill, may not be diversified and are subject to the risks of financing
projects. Equity REITs are also subject to heavy cash flow dependency, defaults
by borrowers, self-liquidation and the possibility of failing to qualify for
tax-free pass-through of income under the Internal Revenue Code of 1986, as
amended (the "Code") and to maintain exemption under the Investment Company Act
of 1940, as amended (the "1940 Act"). By investing in REITs indirectly through a
Fund, a shareholder will bear not only his/her proportionate share of the
expenses of the Fund, but also, indirectly, similar expenses of the REITs.

REPURCHASE AGREEMENTS: Repurchase agreements are agreements under which a
Fund buys a money market instrument and obtains a simultaneous commitment from
the seller to repurchase the instrument at a specified time and agreed-upon
yield. Each Fund may enter into repurchase agreements with banks or
broker-dealers deemed to be creditworthy by IMI under guidelines approved by the
Board of Trustees. A Fund could experience a delay in obtaining direct ownership
of the underlying collateral, and might incur a loss if the value of the
security should decline.

RESTRICTED AND ILLIQUID SECURITIES: An "illiquid security" is an asset that
may not be sold or disposed of in the ordinary course of business within seven
days at approximately the value at which a Fund has valued the security on its
books. A "restricted security" is a security that cannot be offered to the
public for sale without first being registered under the Securities Act of 1933,
and is considered to be illiquid until such filing takes place. There may be a
lapse of time between a Fund's decision to sell a restricted or illiquid
security and the point at which the Fund is permitted or able to sell the
security. If adverse market conditions were to develop during that period, the
Fund might obtain a price less favorable than the price that prevailed when it
decided to sell. In addition, issuers of restricted and other illiquid
securities may not be subject to the disclosure and other investor protection
requirements that would apply if their securities were publicly traded.
Securities whose proceeds are subject to limitations on repatriation of
principal or profits for more than seven days, and those for which market
quotations are not readily available, are considered illiquid for purposes of
the percentage limitations that apply to each Fund's investment in illiquid
securities.

SHARES OF OTHER INVESTMENT COMPANIES: As a shareholder of an investment
company, a Fund will bear its ratable share of the investment company's expenses
(including management fees, in the case of a management investment company).

SMALL COMPANIES: Investing in smaller company stocks involves certain
special considerations and risks that are not usually associated with investing
in larger, more established companies. For example, the securities of smaller
companies may be subject to more abrupt or erratic market movements, because
they tend to be thinly traded and are subject to a greater degree to changes in
the issuer's earnings and prospects. Small companies also tend to have limited
product lines, markets or financial resources. Transaction costs in smaller
company stocks also may be higher than those of larger companies.

WARRANTS: The holder of a warrant has the right to purchase a given number
of shares of a particular issuer at a specified price until expiration of the
warrant. Such investments can provide a greater potential for profit or loss
than an equivalent investment in the underlying security, and are considered
speculative investments. For example, if a warrant were not exercised by the
date of its expiration, a Fund would lose its entire investment.

"WHEN-ISSUED" SECURITIES AND FIRM COMMITMENTS: Purchasing securities on a
"when-issued" or firm commitment basis involves a risk of loss if the value of
the security to be purchased declines prior to the settlement date.

ZERO COUPON BONDS: Zero coupon bonds are debt obligations issued without
any requirement for the periodic payment of interest, and are issued at a
significant discount from face value. Since the interest on such bonds is, in
effect, compounded, they are subject to greater market value fluctuations in
response to changing interest rates than debt securities that distribute income
regularly. In addition, for Federal income tax purposes a Fund generally

20
<PAGE> 21

recognizes and is required to distribute income generated by zero coupon bonds
currently in the amount of the unpaid accrued interest, even though the actual
income will not yet have been received by the Fund.

ORGANIZATION AND MANAGEMENT OF THE FUNDS

Each Fund, other than Ivy Latin America Strategy Fund, is organized as a
separate, diversified portfolio of the Trust, an open-end management investment
company organized as a Massachusetts business trust on December 21, 1983. Ivy
Latin America Strategy Fund is organized as a non-diversified portfolio (see
"Special Considerations Related to Ivy Latin America Strategy Fund"). The
business and affairs of each Fund are managed under the direction of the
Trustees. Information about the Trustees, as well as the Trust's executive
officers, may be found in the SAI. The Trust has an unlimited number of
authorized shares of beneficial interest, and currently has 16 separate
portfolios. Each Fund has three classes of shares, designated as Class A, Class
B and Class C. Ivy Global Science & Technology Fund, Ivy International Fund and
Ivy International Small Companies Fund have a fourth class of shares designated
as Class I. Shares of each Fund entitle their holders to one vote per share
(with proportionate voting for fractional shares). The shares of each class
represent an interest in the same portfolio of Fund investments. Each class of
shares, except for Class I, has a separate Rule 12b-1 distribution plan and
bears different distribution fees. Shares of each class have equal rights as to
voting, redemption, dividends and liquidation but have exclusive voting rights
with respect to their Rule 12b-1 distribution plans.

The Trust employs IMI to provide business management services to the Funds,
and investment advisory services to all of the Funds other than Ivy Canada Fund
and Ivy Global Natural Resources Fund (which are advised by MFC). MIMI provides
administrative and accounting services. Ivy Mackenzie Distributors, Inc.
("IMDI") distributes the Funds' shares, and Ivy Mackenzie Services Corp.
("IMSC") provides transfer agency and shareholder-related services for the
Funds. IMI, IMDI and IMSC are wholly-owned subsidiaries of MIMI. As of November
29, 1996, IMI and MIMI had approximately $2.02 billion and $158 million,
respectively, in assets under management. MIMI is a subsidiary of MFC, which has
been an investment counsel and mutual fund manager in Toronto, Ontario, Canada
for more than 25 years.

INVESTMENT MANAGER

IVY CANADA FUND AND IVY GLOBAL NATURAL RESOURCES FUND: For IMI's business
management services, each Fund pays IMI a fee, which is accrued daily and paid
monthly, based on the Fund's average net assets at an annual rate of 0.50%. Each
Fund pays MFC a monthly fee for advisory services, which is accrued daily and
paid monthly, based on the Fund's average net assets at an annual rate of 0.35%
and 0.50% for Ivy Canada Fund and Ivy Global Natural Resources Fund,
respectively.

IVY ASIA PACIFIC FUND, IVY CHINA REGION FUND, IVY GLOBAL SCIENCE &
TECHNOLOGY FUND, IVY INTERNATIONAL FUND, IVY INTERNATIONAL SMALL COMPANIES FUND,
IVY LATIN AMERICA STRATEGY FUND AND IVY NEW CENTURY FUND: For IMI's business
management and investment advisory services, each Fund pays IMI a fee, which is
accrued daily and paid monthly, based on the Fund's average net assets at an
annual rate of 1.00%.

IMI voluntarily limits the total operating expenses for each Fund except Ivy
International Fund (excluding Rule 12b-1 fees, interest, taxes, brokerage
commissions, litigation, indemnification, and extraordinary expenses) to an
annual rate of 1.95% of the Funds' average net assets, which may lower each
Fund's expenses and increase its yield. This voluntary expense limitation may be
terminated or revised at any time, at which point the affected Fund's expenses
may increase and its yield may be reduced.

Northern Cross currently serves as subadviser for Ivy International Fund,
for which IMI pays a fee at the rate equal, on an annual basis, to 0.60% of the
Fund's average net assets. From July 1, 1990 through March 31, 1993 and from
November 18, 1985 through June 30, 1990, Boston Overseas Investors, Inc. and
Marsh & Cunningham, Inc., respectively, provided subadvisory services to the
Fund, based on the same investment strategy and program currently employed by
Northern Cross.

IVY GLOBAL FUND: For IMI's business management and investment advisory
services, the Fund pays IMI a fee, which is accrured daily and paid monthly,
based on the Fund's average net assets at an annual rate of 1.00% of the first
$500 million in net assets and 0.75% on net assets over $500 million. For the
period from January 1, 1996 to November 29, 1996, the effective management fee
paid to IMI was 0.91% of the Fund's average net assets.

Currently, IMI voluntarily limits the Fund's total operating expenses
(excluding Rule 12b-1 fees, interest taxes, brokerage commissions, litigation,
indemnification, and extraordinary expenses) to an annual rate of 1.95% of the
Fund's average net assets, which may lower the Fund's expenses and increase its
total return. This voluntary expense limitation may be terminated or revised at
any time, at which point the Fund's expenses may increase and its total return
may be reduced.

ALL FUNDS: IMI pays all expenses that it incurs in rendering management
services to the Funds. Each Fund bears its own operational costs. General
expenses of the Trust that are not readily identifiable as belonging to a
particular series of the Trust (or a particular class thereof) are allocated
among and charged to each series based on its relative net asset size. Expenses
that are attributable to a particular Fund (or class thereof) will be borne by
that Fund (or class) directly. The fees payable to IMI are subject to any
reimbursement or fee waiver to which IMI may agree. The investment management
fees paid by the Funds are higher than those charged by many funds that invest
primarily in U.S. securities, but not necessarily higher than the fees charged
to funds with investment objectives similar to those of the Funds.

PORTFOLIO MANAGEMENT: The following individuals have responsibilities for
management of the Funds:

- James W. Broadfoot, an Executive Vice President and Chief Investment
Officer of IMI and Vice President of the Trust, is the portfolio manager
for Ivy Global Science & Technology Fund. Prior to joining the
organization in 1990, Mr. Broadfoot was a principal in an investment
counsel firm specializing in emerging growth companies. Mr. Broadfoot has
24 years of professional investment experience, and is a Chartered
Financial Analyst. He has an MBA from The Wharton School of the University
of Pennsylvania.

- Hakan Castegren, President of Northern Cross, has been the portfolio
manager for Ivy International Fund since its inception in 1986 and has 36
years of professional investment experience. He earned his MBA from the
Stockholm School of Economics.

- Michael G. Landry is the President and a Director of IMI and MIMI and the
President and a Trustee of the Trust. Mr. Landry has headed these
organizations since 1987. Previously he was a Senior Vice President and
portfolio manager with the Templeton organization. He has over 20 years of
professional investment experience. He has a degree in economics from
Carleton University. Mr. Landry is the portfolio manager for Ivy Global
Fund, co-manages Ivy International Small Compa-

21
<PAGE> 22

nies Fund and manages Ivy New Century Fund in conjunction with the Ivy
emerging markets research team.

- Frederick Sturm, a Senior Vice President of MFC, is the portfolio manager
of Ivy Canada Fund and Ivy Global Natural Resources Fund. Mr. Sturm joined
MFC in 1983 and has 11 years of professional investment experience. In
that time, Mr. Sturm has established a performance record in the natural
resource sector. Mr. Sturm, a Chartered Financial Analyst, is a graduate
of the University of Toronto where he earned a degree in commerce and
finance.

- Barbara Trebbi is a Senior Vice President of IMI and managing director of
the Ivy emerging markets research team. In conjunction with the Ivy
emerging markets research team she is the portfolio manager for Ivy Asia
Pacific Fund, Ivy China Region Fund and Ivy Latin America Strategy Fund.
Ms. Trebbi also co-manages Ivy International Small Companies Fund. Ms.
Trebbi joined the organization in 1988 and has eight years of professional
investment experience. She is a Chartered Financial Analyst and holds a
Graduate Diploma from the London School of Economics. In addition to Ms.
Trebbi, the Ivy emerging markets research team is comprised of Frank
DuMond, who has a Bachelor of Science degree from the Massachusetts
Institute of Technology; Justin Lu, located in Shanghai, who is a graduate
of Shanghai International University; Oleg Makhorine, located in Prague,
who is a graduate of the Economics University of Prague; and Moira
McLachlan, who earned her degree in international business from the
University of South Carolina.

FUND ADMINISTRATION AND ACCOUNTING

MIMI provides various administrative services for the Funds, such as
maintaining the registration of Fund shares under state "Blue Sky" laws, and
assisting with the preparation of Federal and state income tax returns,
financial statements and periodic reports to shareholders. MIMI also assists the
Trust's legal counsel with the filing of registration statements, proxies and
other required filings under Federal and state law. Under this arrangement, the
average net assets attributable to each Fund's Class A, Class B and Class C
shares are subject to a fee, accrued daily and paid monthly, at an annual rate
of 0.10%. The average net assets attributable to Class I shares are subject to a
fee at the annual rate of 0.01%.

MIMI also provides certain accounting and pricing services for the Funds
(see "Fund Accounting Services" in the SAI for more information).

TRANSFER AGENT

IMSC is the transfer and dividend-paying agent for the Funds, and also
provides certain shareholder-related services. Certain broker-dealers that
maintain shareholder accounts with the Funds through an omnibus account provide
transfer agent and other shareholder-related services that would otherwise be
provided by IMSC if the individual accounts that comprise the omnibus account
were opened by their beneficial owners directly (see "Investment Advisory and
Other Services" in the SAI).

ALTERNATIVE PURCHASE ARRANGEMENTS

CLASS A SHARES: Class A shares are subject to an initial sales charge,
unless the amount you purchase is $500,000 or more (see "Contingent Deferred
Sales Charge -- Class A Shares"). Certain purchases qualify for a reduced
initial sales charge (see "Qualifying for a Reduced Sales Charge"). Class A
shares (for all Funds except Ivy Canada Fund) are subject to ongoing service
fees at an annual rate of 0.25% of a Fund's average net assets attributable to
its Class A shares. Class A shares of Ivy Canada Fund are subject to ongoing
service and distribution fees at a combined annual rate of up to 0.40% of the
Fund's average net assets attributable to its Class A shares. If you do not
specify on your Account Application which class of shares you are purchasing, it
will be assumed that you are investing in Class A shares.

CLASS B AND CLASS C SHARES: Class B and Class C shares are not subject to
an initial sales charge, but are subject to a CDSC if redeemed within six years
of purchase, in the case of Class B shares, or within one year of purchase, in
the case of Class C shares. Both classes of shares are subject to ongoing
service and distribution fees at a combined annual rate of up to 1.00% of a
Fund's average net assets attributable to its Class B or Class C shares. The
ongoing distribution fee will cause these shares to have a higher expense ratio
than that of Class A shares. Also, to the extent that a Fund pays any dividends,
these higher expenses will result in lower dividends than those paid on Class A
shares.

CLASS I SHARES: Class I shares are offered by Ivy Global Science &
Technology Fund, Ivy International Fund and Ivy International Small Companies
Fund only to institutions and certain individuals, and are not subject to an
initial sales charge or a CDSC, nor to ongoing service or distribution fees.
Class I shares also bear lower fees than Class A, Class B and Class C shares.

FACTORS TO CONSIDER IN CHOOSING AN ALTERNATIVE: The multi-class structure
of the Funds allows you to choose the most beneficial way to buy shares given
the size of your purchase and the length of time you expect to hold your shares.
You should consider whether, during the anticipated life of your Fund
investment, the accumulated service and distribution fees on Class B and Class C
shares would be less than the initial sales charge and accumulated service fees
on Class A shares purchased at the same time, and to what extent this
differential would be offset by the Class A shares' potentially higher yield.
Also, sales personnel may receive different compensation depending on which
class of shares they are selling. The tables under the caption "Annual Fund
Operating Expenses" at the beginning of this Prospectus contain additional
information that is designed to assist you in making this determination.

DIVIDENDS AND TAXES

DIVIDENDS: Distributions you receive from a Fund are reinvested in
additional shares of the same class of a Fund unless you elect to receive them
in cash. Dividends ordinarily will vary from one class to another.

Each Fund intends to make a distribution for each fiscal year of any net
investment income and net realized short-term capital gain, as well as any net
long-term capital gain realized during the year. An additional distribution may
be made of net investment income, net realized short-term capital gains and net
realized long-term capital gains to comply with the calendar year distribution
requirement under the excise tax provisions of Section 4982 of the Code.

TAXATION: The following discussion is intended for general information
only. You should consult with your tax adviser as to the tax consequences of an
investment in a particular Fund, including the status of distributions from the
Fund under applicable state or local law.

Each Fund intends to qualify annually as a regulated investment company
under the Code. To qualify, each Fund must meet certain income, distribution and
diversification requirements. In any year in which a Fund qualifies as a
regulated investment company and timely distributes all of its taxable income,
the Fund generally will not pay any Federal income or excise tax.

22
<PAGE> 23

Dividends paid out of a Fund's investment company taxable income (including
dividends, interest and net short-term capital gains) will be taxable to a
shareholder as ordinary income. If a portion of a Fund's income consists of
dividends paid by U.S. corporations, a portion of the dividends paid by the Fund
may be eligible for the corporate dividends-received deduction. Distributions of
net capital gains (the excess of net long-term capital gains over net short-term
capital losses), if any, are taxable as long-term capital gains, regardless of
how long the shareholder has held a Fund's shares. Dividends are taxable to
shareholders in the same manner whether received in cash or reinvested in
additional Fund shares.

If, for any year, a Fund's total distributions exceed its earnings and
profits, the excess will generally be treated as a return of capital. The amount
treated as a return of capital will reduce a shareholder's adjusted basis in
his/her shares (thereby increasing potential gain or reducing potential loss on
the sale of shares) and, to the extent that the amount exceeds this basis, will
be treated as a taxable gain.

A distribution will be treated as paid on December 31 of the current
calendar year if it is declared by a Fund in October, November or December with
a record date in such a month and paid by the Fund during January of the
following calendar year. Such distributions will be taxable to shareholders in
the calendar year in which the distributions are declared, rather than the
calendar year in which the distributions are received.

Investments in securities that are issued at a discount will result each
year in income to a Fund equal to a portion of the excess of the face value of
the securities over their issue price, even though the Fund receives no cash
interest payments from the securities.

Income and gains received by a Fund from sources within foreign countries
may be subject to foreign withholding and other taxes. Unless a Fund is eligible
to and elects to "pass through" to its shareholders the amount of foreign income
and similar taxes paid by the Fund, these taxes will reduce the Fund's
investment company taxable income, and distributions of investment company
taxable income received from the Fund will be treated as U.S. source income.

Any gain or loss realized by a shareholder upon the sale or other
disposition of shares of a Fund, or upon receipt of a distribution in complete
liquidation of the Fund, generally will be a capital gain or loss which will be
long-term or short-term, generally depending upon the shareholder's holding
period for the shares.

A Fund may be required to withhold U.S. Federal income tax at the rate of
31% of all taxable distributions payable to shareholders who fail to provide the
Fund with their correct taxpayer identification number or to make required
certifications, or who have been notified by the Internal Revenue Service
("IRS") that they are subject to backup withholding. Backup withholding is not
an additional tax. Any amounts withheld may be credited against the
shareholder's U.S. Federal income tax liability.

Fund distributions may be subject to state, local and foreign taxes.
Distributions of a Fund which are derived from interest on obligations of the
U.S. Government and certain of its agencies, authorities and instrumentalities
may be exempt from state and local taxes in certain states. Further information
relating to tax consequences is contained in the SAI.

PERFORMANCE DATA

Performance information (e.g., "total return" and "yield") is computed
separately for each class of Fund shares in accordance with formulas prescribed
by the SEC. Performance information for each class may be compared in reports
and promotional literature to indices such as the Standard and Poor's 500 Stock
Index, Dow Jones Industrial Average, and Morgan Stanley Capital International
World Index. Advertisements, sales literature and communications to shareholders
may also contain statements of a Fund's current yield, various expressions of
total return and current distribution rate. Performance figures will vary in
part because of the different expense structures of the Funds' different
classes. ALL PERFORMANCE INFORMATION IS HISTORICAL AND IS NOT INTENDED TO
SUGGEST FUTURE RESULTS.

"Total return" is the change in value of an investment in a Fund for a
specified period, and assumes the reinvestment of all distributions and
imposition of the maximum applicable sales charge. "Average annual total return"
represents the average annual compound rate of return of an investment in a
particular class of Fund shares assuming the investment is held for one year,
five years and ten years as of the end of the most recent calendar quarter.
Where a Fund provides total return quotations for other periods, or based on
investments at various sales charge levels or at net asset value, "total return"
is based on the total of all income and capital gains paid to (and reinvested
by) shareholders, plus (or minus) the change in the value of the original
investment expressed as a percentage of the purchase price.

"Current yield" reflects the income per share earned by a Fund's portfolio
investments, and is calculated by dividing the Fund's net investment income per
share during a recent 30-day period by the maximum public offering price on the
last day of that period and then annualizing the result. Dividends or
distributions that were paid to a Fund's shareholders are reflected in the
"current distribution rate," which is computed by dividing the total amount of
dividends per share paid by a Fund during the preceding 12 months by the Fund's
current maximum offering price (which includes any applicable sales charge). The
"current distribution rate" will differ from the "current yield" computation
because it may include distributions to shareholders from sources other than
dividends and interest, short term capital gain and net equalization credits and
will be calculated over a different period of time.

HOW TO BUY SHARES

OPENING AN ACCOUNT: Complete and sign the Account Application on the last
page of this Prospectus. Make your check payable to the Fund in which you are
investing. No third party checks will be accepted. Deliver these items to your
registered representative or selling broker, or send them to one of the
addresses below:

Regular Mail:

IVY MACKENZIE SERVICES CORP.
P.O. BOX 3022
BOCA RATON, FL 33431-0922

Courier:

IVY MACKENZIE SERVICES CORP.
700 SOUTH FEDERAL HIGHWAY, SUITE 300
BOCA RATON, FL 33432

The Funds reserve the right to reject, for any reason, any purchase order.

MINIMUM INVESTMENT POLICIES: The minimum initial investment is $1,000; the
minimum additional investment is $100. Initial or additional amounts for
retirement accounts may be less (see "Retirement Plans").

Accounts in Class I of any of the Class I Funds can be opened with a minimum
initial investment of $5,000,000; the minimum additional investment

23
<PAGE> 24

is $10,000. The minimum initial investment in Class I of these Funds may be
spread over the thirteen-month period following the opening of the account.

BUYING ADDITIONAL SHARES: You may add to your account at any time through
any of the following options:

By Mail: Complete the investment slip attached to your statement, or write
instructions including the account registration, Fund number and account number
of the shares you wish to purchase. Send your check (payable to the Fund in
which you are investing), along with your investment slip or written
instructions, to one of the addresses above.

Through your Broker: Deliver the investment slip attached to your
statement, or written instructions, along with your payment to your registered
representative or selling broker.

By Wire: Purchases may also be made by wiring money from your bank account
to your Ivy account. Your bank may charge a fee for wiring funds. Before wiring
any funds, please call IMSC at 1-800-777-6472. Wiring instructions are as
follows:
FIRST UNION NATIONAL BANK OF FLORIDA
JACKSONVILLE, FL
ABA#063000021
ACCOUNT #2090002063833
FOR FURTHER CREDIT TO:
YOUR IVY ACCOUNT REGISTRATION
YOUR FUND NUMBER AND ACCOUNT NUMBER

By Automatic Investment Method: Complete Sections 6A and 7B on the Account
Application (see "Automatic Investment Method" on page 30 for more information).

HOW YOUR PURCHASE PRICE IS DETERMINED

Your purchase price for Class A shares of a Fund is the net asset value
("NAV") per share plus a sales charge, which may be reduced or eliminated in
certain circumstances. The purchase price per share is known as the public
offering price. Your purchase price for Class B, Class C and Class I shares is
the NAV per share.

Share purchases will be made at the next determined price after your
purchase order is received. The price is effective for orders received by IMSC
or by your registered securities dealer prior to the time of the determination
of the NAV. Any orders received after the time of the determination of the NAV
will be entered at the next calculated price.

Orders placed with a securities dealer before the NAV is determined that are
transmitted through the facilities of the National Securities Clearing
Corporation on the same day are confirmed at that day's price. Any loss
resulting from the dealer's failure to submit an order by the deadline will be
borne by that dealer.

You will receive an account statement after any purchase, exchange or full
liquidation. Statements related to reinvestment of dividends, capital gains,
automatic investment plans (see the SAI for further explanation) and/or
systematic withdrawal plans will be sent quarterly.
HOW EACH FUND VALUES ITS SHARES

The NAV per share is the value of one share. The NAV is determined for each
Class of shares as of the close of the New York Stock Exchange on each day the
Exchange is open by dividing the value of a Fund's net assets attributable to a
class by the number of shares of that class that are outstanding, adjusted to
the nearest cent. These procedures are described more completely in the SAI.

The Trust's Board of Trustees has established procedures to value a Fund's
securities in order to determine the NAV. The value of a foreign security is
determined as of the normal close of trading on the foreign exchange on which it
is traded or as of the close of regular trading on the New York Stock Exchange,
if that is earlier. If no sale is reported at that time, the average between the
current bid and asked price is used. All other securities for which OTC market
quotations are readily available are valued at the average between the current
bid and asked price. Securities and other assets for which market prices are not
readily available are valued at fair value, as determined by IMI and approved in
good faith by the Board. Money market instruments of a Fund are valued at
amortized cost.

INITIAL SALES CHARGE ALTERNATIVE -- CLASS A SHARES

Shares are purchased at a public offering price equal to their NAV per share
plus a sales charge, as set forth below.

<TABLE>
<CAPTION>
SALES CHARGE
----------------------- PORTION OF
AS A AS A PUBLIC
PERCENTAGE PERCENTAGE OFFERING
OF PUBLIC OF NET PRICE
OFFERING AMOUNT RETAINED
AMOUNT INVESTED PRICE INVESTED BY DEALER
- ----------------------------------------------------- ---------- ---------- ----------
<S> <C> <C> <C>
Less than $50,000.................................... 5.75% 6.10% 5.00%
$50,000 but less than $100,000....................... 5.25% 5.54% 4.50%
$100,000 but less than $250,000...................... 4.50% 4.71% 3.75%
$250,000 but less than $500,000...................... 3.00% 3.09% 2.50%
$500,000 or over*.................................... 0.00% 0.00% 0.00%
</TABLE>

* A CDSC may apply to the redemption of Class A shares that are purchased
without an initial sales charge. See "Contingent Deferred Sales Charge --
Class A Shares."

Sales charges are not applied to any dividends or capital gains that are
reinvested in additional shares of the Fund. An investor may be charged a
transaction fee for Class A and Class I shares purchased or redeemed at NAV
through a broker or agent other than IMDI.

With respect to purchases of $500,000 or more through dealers or agents,
IMDI may, at the time of purchase, pay such dealers or agents from its own
resources a commission to compensate such dealers or agents for their
distribution assistance in connection with such purchases. The commission would
be computed as set forth below:

NAV COMMISSION TABLE
(FOR ALL IVY FUNDS EXCEPT IVY INTERNATIONAL FUND)

<TABLE>
<CAPTION>
PURCHASE AMOUNT COMMISSION
- ------------------------------------------------------------------------------ ----------
<S> <C> <C>
First $3,000,000............................................................ 1.00%
Next $2,000,000............................................................ .50%
Over $5,000,000............................................................ .25%
</TABLE>

NAV COMMISSION TABLE
(IVY INTERNATIONAL FUND)

<TABLE>
<CAPTION>
PURCHASE AMOUNT COMMISSION
- ------------------------------------------------------------------------------ ----------
<S> <C> <C>
First $3,000,000............................................................ .50%
Next $2,000,000............................................................ .25%
Over $5,000,000............................................................ .10%
</TABLE>

Dealers who receive 90% or more of the sales charge may be deemed to be
"underwriters" as that term is defined in the 1933 Act.

24
<PAGE> 25

IMDI compensates participating brokers who sell Class A shares through the
initial sales charge. IMDI retains that portion of the initial sales charge that
is not reallowed to the dealers, which it may use to distribute a Fund's Class A
shares. Pursuant to separate distribution plans for the Funds' Class A, Class B
and Class C shares, IMDI bears various promotional and sales related expenses,
including the cost of printing and mailing prospectuses to persons other than
shareholders. Pursuant to the Funds' Class A distribution plans, IMDI currently
pays a continuing service fee to qualified dealers at an annual rate of 0.25% of
qualified investments.

IMDI may from time to time pay a bonus or other incentive to dealers (other
than IMDI) which employ a registered representative who sells a minimum dollar
amount of the shares of a Fund and/or other funds distributed by IMDI during a
specified period of time. This bonus or other incentive may take the form of
payment for travel expenses, including lodging, incurred in connection with
trips taken by qualifying registered representatives and members of their
families to places within or without the U.S. or other bonuses such as gift
certificates or the cash equivalent of such bonus or incentive.

CONTINGENT DEFERRED SALES CHARGE -- CLASS A SHARES

Purchases of $500,000 or more of Class A shares will be made at NAV with no
initial sales charge, but if the shares are redeemed within 24 months (12
months, in the case of Ivy International Fund) after the end of the calendar
month in which the purchase was made (the CDSC period), a CDSC of 1.00% will be
imposed (0.50%, in the case of Ivy International Fund).

In order to recover commissions paid to dealers on NAV transfers (as defined
in "Purchases of Class A Shares at Net Asset Value"), Class A shares of a Fund
are subject to a CDSC of 1.00% (0.50%, in the case of Ivy International Fund)
for certain redemptions within 24 months (12 months, in the case of Ivy
International Fund) after the date of purchase.

The charge will be assessed on an amount equal to the lesser of the current
market value or the original purchase cost of the Class A shares redeemed.
Accordingly, no CDSC will be imposed on increases in account value above the
initial purchase price, including any dividends or capital gains which have been
reinvested in additional Class A shares.

In determining whether a CDSC applies to a redemption, the calculation will
be determined in a manner that results in the lowest possible rate being
charged. Therefore, it will be assumed that the redemption is first made from
any shares in your account not subject to the CDSC. The CDSC is waived in
certain circumstances. See the discussion below under the caption "Waiver of
Contingent Deferred Sales Charge."

WAIVER OF CONTINGENT DEFERRED SALES CHARGE: The CDSC is waived for (i)
redemptions in connection with distributions not exceeding 12% annually of the
initial account balance (i.e., the value of the shareholder's Class A Fund
account at the time of the initial distribution) (ia) following retirement under
a tax qualified retirement plan, or (ib) upon attaining age 59 1/2 in the case
of an IRA, a custodial account pursuant to section 403(b)(7) of the Code or a
Keogh Plan; (ii) redemption resulting from tax-free return of an excess
contribution to an IRA; or (iii) any partial or complete redemption following
the death or disability (as defined in Section 72(m)(7) of the Code) of a
shareholder from an account in which the deceased or disabled is named, provided
that the redemption is requested within one year of death or disability. IMDI
may require documentation prior to waiver of the CDSC.

Class A shareholders may exchange their Class A shares subject to a CDSC
("outstanding Class A shares") for Class A shares of another Ivy or Mackenzie
Fund ("new Class A shares") on the basis of the relative NAV per Class A share,
without the payment of any CDSC that would be due upon the redemption of the
outstanding Class A shares. The original CDSC rate that would have been charged
if the outstanding Class A shares were redeemed will carry over to the new Class
A shares received in the exchange, and will be charged accordingly at the time
of redemption.

QUALIFYING FOR A REDUCED SALES CHARGE

RIGHTS OF ACCUMULATION (ROA): Rights of Accumulation ("ROA") is calculated
by determining the current market value of all Class A shares in all Ivy or
Mackenzie fund accounts (except Ivy Money Market Fund) owned by you, your
spouse, and your children under 21 years of age. ROA is also applicable to
accounts under a trustee or other single fiduciary (including retirement
accounts qualified under Section 401 of the Code). The current market value of
each of your accounts as described above is added together and then added to
your current purchase amount. If the combined total is equal or greater than a
breakpoint amount for a Fund, then you qualify for the reduced sales charge. To
reduce or eliminate the sales charge, you must complete Section 4C of the
Account Application.

LETTER OF INTENT (LOI): A Letter of Intent ("LOI") is a non-binding
agreement that states your intention to invest in additional Class A shares,
within a thirteen month period after the initial purchase, an amount equal to a
breakpoint amount for a Fund. The LOI may be backdated up to 90 days. To sign an
LOI, please complete Section 4C of the Account Application.

Should the LOI not be fulfilled within the thirteen month period, your
account will be debited for the difference between the full sales charge that
applies for the amount actually invested and the reduced sales charge actually
paid on purchases placed under the terms of the LOI.

PURCHASES OF CLASS A SHARES AT NET ASSET VALUE: Investors who held Ivy Fund
shares as of December 31, 1991, or who held shares of certain funds that were
reorganized into an Ivy or Mackenzie fund, may be exempt from sales charges on
the purchase of Class A shares of any of the Ivy or Mackenzie funds. If you
believe you may be eligible for such an exemption, please contact IMSC at
1-800-235-3322 for additional information.

Class A shares of a Fund may be purchased without an initial sales charge or
CDSC by (i) officers and Trustees of the Trust (and their relatives), (ii)
officers, directors, employees, retired employees, legal counsel and independent
accountants of IMI, MIMI, and MFC (and their relatives), and (iii) directors,
officers, partners, registered representatives, employees and retired employees
(and their relatives) of dealers having a sales agreement with IMDI (or trustees
or custodians of any qualified retirement plan or IRA established for the
benefit of any such person). In addition, certain investment advisors and
financial planners who charge a management, consulting or other fee for their
services and who place trades for their own accounts or the accounts of their
clients may purchase Class A shares of a Fund without an initial sales charge or
a CDSC, provided such purchases are placed through a broker or agent who
maintains an omnibus account with that Fund. Also, clients of these advisors and
planners may make purchases under the same conditions if the purchases are
through the master account of such advisor or planner on the books of such
broker or agent. This provision applies to assets of retirement and deferred
compensation plans and trusts used to fund those plans including, but not
limited to, those defined in Section 401(a), 403(b) or 457 of the Code and
"Rabbi Trusts" whose assets are used to purchase shares of a fund through the
aforementioned channels.

25
<PAGE> 26

Class A shares of a Fund may be purchased at NAV by retirement plans
qualified under section 401(a) or 403(b) of the Code, subject to the Employee
Retirement Income Security Act of 1974, as amended. A CDSC of 1.00% (0.50%, in
the case of Ivy International Fund) will be imposed on such purchases in the
event of certain plan-level redemption transactions within 24 months (12 months,
in the case of Ivy International Fund) following such purchases.

If investments by retirement plans at NAV are made through a dealer who has
executed a dealer agreement with respect to a Fund, IMDI may, at the time of
purchase, pay the dealer out of IMDI's own resources a commission to compensate
the dealer for its distribution assistance in connection with the retirement
plan's investment. Please refer to the NAV Commission Tables on page 24 of this
Prospectus. Please contact IMDI for additional information.

Class A shares can also be purchased without an initial sales charge, but
subject to a CDSC of 1.00% during the first 24 months (0.50% during the first 12
months, in the case of Ivy International Fund), by: (a) any state, county, city
(or any instrumentality, department, authority or agency of such entities) that
is prohibited by applicable investment laws from paying a sales charge or
commission when purchasing shares of a registered investment management company
(an "eligible governmental authority"), and (b) trust companies, bank trust
departments, credit unions, savings and loans and other similar organizations in
their fiduciary capacity or for their own accounts, subject to any minimum
requirements set by IMDI (currently, these criteria require that the amount
invested or to be invested in the subsequent 13-month period totals at least
$250,000). In either case, IMDI may pay commissions to dealers that provide
distribution assistance on the same basis as in the preceding paragraph.

Class A shares of a Fund may also be purchased without a sales charge in
connection with certain liquidation, merger or acquisition transactions
involving other investment companies or personal holding companies.

Each Fund may, from time to time, waive the initial sales charge on its
Class A shares sold to clients of various broker-dealers with which IMDI has a
selling relationship. This privilege will apply only to Class A Shares of a Fund
that are purchased using all or a portion of the proceeds obtained by such
clients through redemptions of shares (on which a commission has been paid) of
an investment company (other than Mackenzie Series Trust or the Trust), unit
investment trust or limited partnership ("NAV transfers"). Some dealers may
elect not to participate in this program. Those dealers that do elect to
participate in the program must complete certain forms required by IMDI. The
normal service fee, as described in the "Initial Sales Charge Alternative --
Class A Shares" and "Contingent Deferred Sales Charge Alternative -- Class B and
Class C Shares" sections of this Prospectus, will be paid to dealers in
connection with these purchases. Additional information on reductions or waivers
may be obtained from IMDI at the address listed on the cover of the Prospectus.

CONTINGENT DEFERRED SALES CHARGE ALTERNATIVE -- CLASS B AND CLASS C SHARES

Class B and Class C shares are offered at NAV per share without a front end
sales charge. Class C shares redeemed within one year of purchase will be
subject to a CDSC of 1%, and Class B shares redeemed within six years of
purchase will be subject to a CDSC at the rates set forth below. This charge
will be assessed on an amount equal to the lesser of the current market value or
the original purchase cost of the shares being redeemed. Accordingly, you will
not be assessed a CDSC on increases in account value above the initial purchase
price, including shares derived from dividends or capital gains reinvested. In
determining whether a CDSC applies to a redemption, the calculation will be
determined in a manner that results in the lowest possible rate being charged.
It will be assumed that your redemption comes first from shares you have held
beyond the requisite maximum holding period or those you acquire through
reinvestment of dividends or capital gains, and next from the shares you have
held the longest during the requisite holding period.

Proceeds from the CDSC are paid to IMDI. The proceeds are used, in whole or
in part, to defray its expenses related to providing each Fund with distribution
services in connection with the sale of Class B and Class C shares, such as
compensating selected dealers and agents for selling these shares. The
combination of the CDSC and the distribution and service fees makes it possible
for a Fund to sell Class B or Class C shares without deducting a sales charge at
the time of the purchase.

In the case of Class B shares, the amount of the CDSC, if any, will vary
depending on the number of years from the time you purchase your Class B shares
until the time you redeem them. Solely for purposes of determining this holding
period, any payments you make during the quarter will be aggregated and deemed
to have been made on the last day of the quarter. In the case of Class C shares,
solely for purposes of determining this holding period, any purchases you make
during a month will be deemed to have been made on the last day of the month.

<TABLE>
<CAPTION>
CONTINGENT
DEFERRED SALES
CHARGE AS A
CLASS B SHARES PERCENTAGE OF
DOLLAR AMOUNT
YEAR SINCE PURCHASE SUBJECT TO CHARGE
- ---------------------------------------------- -----------------
<S> <C>
First......................................... 5%
Second........................................ 4%
Third......................................... 3%
Fourth........................................ 3%
Fifth......................................... 2%
Sixth......................................... 1%
Seventh and thereafter........................ 0%
</TABLE>

IMDI currently intends to pay to dealers a sales commission of 4% of the
sale price of Class B shares that they have sold, and will receive the entire
amount of the CDSC paid by shareholders on the redemption of Class B shares to
finance the 4% commission and related marketing expenses.

With respect to Class C shares, IMDI currently intends to pay to dealers a
sales commission of 1% of the sale price of Class C shares that they have sold,
a portion of which is to compensate the dealers for providing Class C
shareholder account services during the first year of investment. IMDI will
receive the entire amount of the CDSC paid by shareholders on the redemption of
Class C shares to finance the 1% commission and related marketing expenses.

Pursuant to separate distribution plans for the Funds' Class B and Class C
shares, IMDI bears various promotional and sales related expenses, including the
cost of printing and mailing prospectuses to persons other than shareholders.
Under the Funds' Class B Plan, IMDI retains 0.75% of the continuing 1.00%
service/distribution fee assessed to Class B shareholders, and pays a continuing
service fee to qualified dealers at an annual rate of 0.25% of qualified
investments. Under the Class C Plan, IMDI pays continuing service/distribution
fees to qualified dealers at an annual rate of 1.00% of qualified investments
after the first year of investment (0.25% of which represents a service fee).

CONVERSION OF CLASS B SHARES: Your Class B shares and an appropriate
portion of both reinvested dividends and capital gains on those shares will be
converted into Class A shares automatically no later than the month following

26
<PAGE> 27

eight years after the shares were purchased, resulting in lower annual
distribution fees. If you exchanged Class B shares into a Fund from Class B
shares of another Ivy or Mackenzie fund, the calculation will be based on the
time the shares in the original fund were purchased.

WAIVER OF CONTINGENT DEFERRED SALES CHARGE: The CDSC is waived for (i)
redemptions in connection with distributions not exceeding 12% annually of the
initial account balance (i.e., the value of the shareholder's Class B or Class C
Fund account at the time of the initial distribution) (ia) following retirement
under a tax qualified retirement plan, or (ib) upon attaining age 59 1/2 in the
case of an IRA, a custodial account pursuant to section 403(b)(7) of the Code or
a Keogh Plan; (ii) redemption resulting from tax-free return of an excess
contribution to an IRA; or (iii) any partial or complete redemption following
the death or disability (as defined in Section 72(m)(7) of the Code) of a
shareholder from an account in which the deceased or disabled is named, provided
that the redemption is requested within one year of death or disability. IMDI
may require documentation prior to waiver of the CDSC.

ARRANGEMENTS WITH BROKER-DEALERS AND OTHERS: IMDI may, at its own expense,
pay concessions in addition to those described above to dealers that satisfy
certain criteria established from time to time by IMDI. These conditions relate
to increasing sales of shares of the Funds over specified periods and to certain
other factors. These payments may, depending on the dealer's satisfaction of the
required conditions, be periodic and may be up to (i) 0.25% of the value of Fund
shares sold by the dealer during a particular period, and (ii) 0.10% of the
value of Fund shares held by the dealer's customers for more than one year,
calculated on an annual basis.

HOW TO REDEEM SHARES

You may redeem your Fund shares through your registered securities
representative, by mail or by telephone. A CDSC may apply to certain Class A
share redemptions, to Class B share redemptions prior to conversion and to Class
C shares that are redeemed within one year of purchase. All redemptions are made
at the NAV next determined after a redemption request has been received in good
order. Requests for redemptions must be received by 4:00 p.m. Eastern time to be
processed at the NAV for that day. Any redemption request in good order that is
received after 4:00 p.m. Eastern time will be processed at the price determined
on the following business day. IF SHARES TO BE REDEEMED WERE PURCHASED BY CHECK,
PAYMENT OF THE REDEMPTION MAY BE DELAYED UNTIL THE CHECK HAS CLEARED OR FOR UP
TO 15 DAYS AFTER THE DATE OF PURCHASE. If you own shares of more than one class
of a Fund, the Fund will redeem first the shares having the highest 12b-1 fees;
any shares subject to a CDSC will be redeemed last unless you specifically elect
otherwise.

When shares are redeemed, a Fund generally sends you payment on the next
business day. Under unusual circumstances, a Fund may suspend redemptions or
postpone payment to the extent permitted by Federal securities laws. The
proceeds of the redemption may be more or less than the purchase price of your
shares, depending upon, among other factors, the market value of the Fund's
securities at the time of the redemption. If the redemption is for over $50,000,
or the proceeds are to be sent to an address other than the address of record,
or an address change has occurred in the last 30 days, it must be requested in
writing with a signature guarantee. See "Signature Guarantees," below.

If you are not certain of the requirements for a redemption, please contact
IMSC at 1-800-777-6472.

THROUGH YOUR REGISTERED SECURITIES DEALER: The Dealer is responsible for
promptly transmitting redemption orders. Redemptions requested by dealers will
be made at the NAV (less any applicable CDSC) determined at the close of regular
trading (4:00 p.m. Eastern time) on the day that a redemption request is
received in good order by IMSC.

BY MAIL: Requests for redemption in writing are considered to be in "proper
or good order" if they contain the following:

- Any outstanding certificate(s) for shares being redeemed.

- A letter of instruction, including the account registration, fund number,
the account number and the dollar amount or number of shares to be
redeemed.

- Signatures of all registered owners whose names appear on the account.

- Any required signature guarantees.

- Other supporting legal documentation, if required (in the case of estates,
trusts, guardianships, corporations, unincorporated associations,
retirement plan trustees or others acting in representative capacities).

The dollar amount or number of shares indicated for redemption must not
exceed the available shares or NAV of your account at the next-determined
prices. If your request exceeds these limits, then the trade will be rejected in
its entirety.

Mail your request to IMSC at one of the addresses on page 24 of this
Prospectus.

BY TELEPHONE: Individual and joint accounts may redeem up to $50,000 per
day over the telephone by contacting IMSC at 1-800-777-6472. In times of unusual
economic or market changes, the telephone redemption privilege may be difficult
to implement. If you are unable to execute your transaction by telephone, you
may want to consider placing the order in writing and sending it by mail or
overnight courier.

Checks will be made payable to the current account registration and sent to
the address of record. If there has been a change of address in the last 30
days, please use the instructions for redemption requests by mail described
above. A signature guarantee would be required.

Requests for telephone redemptions will be accepted from the registered
owner of the account, the designated registered representative or the registered
representative's assistant.

Shares held in certificate form cannot be redeemed by telephone.

If Section 6E of the Account Application is not completed, telephone
redemption privileges will be provided automatically. Although telephone
redemptions may be a convenient feature, you should realize that you may be
giving up a measure of security that you may otherwise have if you terminated
the privilege and redeemed your shares in writing. If you do not wish to make
telephone redemptions or let your registered representative do so on your
behalf, you must notify IMSC in writing.

Each Fund employs reasonable procedures that require personal identification
prior to acting on redemption instructions communicated by telephone to confirm
that such instructions are genuine. In the absence of such procedures, a Fund
may be liable for any losses due to unauthorized or fraudulent telephone
instructions.

Receiving Your Proceeds By Federal Funds Wire: For shareholders who
established this feature at the time they opened their account, telephone
instructions will be accepted for redemption of amounts up to $50,000 ($1,000

27
<PAGE> 28

minimum) and proceeds will be wired on the next business day to a predesignated
bank account.

In order to add this feature to an existing account or to change existing
bank account information, please submit a letter of instructions including your
bank information to IMSC at the address provided above. The letter must be
signed by all registered owners, and their signatures must be guaranteed.

Your account will be charged a fee of $10 each time redemption proceeds are
wired to your bank. Your bank may also charge you a fee for receiving a Federal
Funds wire.

Neither IMSC nor any of the Funds can be responsible for the efficiency of
the Federal Funds wire system or the shareholder's bank.

MINIMUM ACCOUNT BALANCE REQUIREMENTS

Due to the high cost of maintaining small accounts and subject to state law
requirements, a Fund may redeem the accounts of shareholders whose investment,
including sales charges paid, has been less than $1,000 for more than 12 months.
A Fund will not redeem an account unless the shareholder has been given at least
60 days' advance notice of the Fund's intention to do so. No redemption will be
made if a shareholder's account falls below the minimum due to a reduction in
the value of the Fund's portfolio securities. This provision does not apply to
IRAs, other retirement accounts and UGMA/UTMA accounts.

SIGNATURE GUARANTEES

For your protection, and to prevent fraudulent redemptions, we require a
signature guarantee in order to accommodate the following requests:

- Redemption requests over $50,000.

- Requests for redemption proceeds to be sent to someone other than the
registered shareholder.

- Requests for redemption proceeds to be sent to an address other than the
address of record.

- Registration transfer requests.

- Requests for redemption proceeds to be wired to your bank account (if this
option was not selected on your original application, or if you are
changing the bank wire information).

A signature guarantee may be obtained only from an eligible guarantor
institution as defined in Rule 17Ad-15 of the Securities Exchange Act of 1934,
as amended. An eligible guarantor institution includes banks, brokers, dealers,
municipal securities dealers, government securities dealers, government
securities brokers, credit unions, national securities exchanges, registered
securities associations, clearing agencies and savings associations. The
signature guarantee must not be qualified in any way. Notarizations from notary
publics are not the same as signature guarantees, and are not accepted.

Circumstances other than those described above may require a signature
guarantee. Please contact IMSC at 1-800-777-6472 for more information.

CHOOSING A DISTRIBUTION OPTION

You have the option of selecting the distribution option that best suits
your needs:

AUTOMATIC REINVESTMENT OPTION -- Both dividends and capital gains are
automatically reinvested at NAV in additional shares of the same class of a Fund
unless you specify one of the other options.

INVESTMENT IN ANOTHER IVY OR MACKENZIE FUND -- Both dividends and capital
gains are automatically invested at NAV in another Ivy or Mackenzie Fund of the
same class.

DIVIDENDS IN CASH/CAPITAL GAINS REINVESTED -- Dividends will be paid in
cash. Capital gains will be reinvested at NAV in additional shares of the same
class of a Fund or another Ivy or Mackenzie Fund of the same class.

DIVIDENDS AND CAPITAL GAINS IN CASH -- Both dividends and capital gains will
be paid in cash.

If you wish to have your cash distributions deposited directly to your bank
account via electronic funds transfer ("EFT"), or if you wish to change your
distribution option, please contact IMSC at 1-800-777-6472.

If you wish to have your cash distributions go to an address other than the
address of record, you must provide IMSC with a letter of instruction signed by
all registered owners with signatures guaranteed.

TAX IDENTIFICATION NUMBER

In general, to avoid being subject to a 31% U.S. Federal backup withholding
tax on dividends, capital gains distributions and redemption proceeds, you must
furnish a Fund with your certified tax identification number ("TIN") and certify
that you are not subject to backup withholding due to prior underreporting of
interest and dividends to the IRS. If you fail to provide a certified TIN, or
such other tax-related certifications as a Fund may require, within 30 days of
opening your new account, each Fund reserves the right to involuntarily redeem
your account and send the proceeds to your address of record.

You can avoid the above withholding and/or redemption by correctly
furnishing your TIN, and making certain certifications, in Section 2 of the
Account Application at the time you open your new account, unless the IRS
requires that backup withholding be applied to your account.

Certain payees, such as corporations, generally are exempt from backup
withholding. Please complete IRS Form W-9 with the new account application to
claim this exemption. If the registration is for an UGMA/UTMA account, please
provide the social security number of the minor. Non-U.S. investors who do not
have a TIN must provide, with their Account Application, a completed IRS Form
W-8.

CERTIFICATES

In order to facilitate transfers, exchanges and redemptions, most
shareholders elect not to receive certificates. Should you wish to have a
certificate issued, please contact IMSC at 1-800-777-6472 and request that one
be sent to you. (Retirement plan accounts are not eligible for this service.)
Please note that if you were to lose your certificate, you would incur an
expense to replace it.

Certificates requested by telephone for shares valued up to $50,000 will be
issued to the current registration and mailed to the address of record. Should
you wish to have your certificates mailed to a different address, or registered
differently from the current registration, contact IMSC at 1-800-777-6472.

EXCHANGE PRIVILEGE

Shareholders of a Fund have an exchange privilege with other Ivy and
Mackenzie funds. The Funds reserve the right to reject, for any reason, any
exchange orders.

28
<PAGE> 29

Class A shareholders may exchange their outstanding Class A shares for Class
A shares of another Ivy or Mackenzie fund on the basis of the relative NAV per
Class A share, plus an amount equal to the difference between the sales charge
previously paid on the outstanding Class A shares and the sales charge payable
at the time of the exchange on the new Class A shares. Incremental sales charges
are waived for outstanding Class A shares that have been invested for 12 months
or longer.

Class B (and Class C) shareholders may exchange their outstanding Class B
(or Class C) shares for Class B (or Class C) shares of another Ivy or Mackenzie
Fund on the basis of the relative NAV per Class B (or Class C) share, without
the payment of any CDSC that would otherwise be due upon the redemption of Class
B (or Class C) shares. Class B shareholders who exercise the exchange privilege
would continue to be subject to the original Fund's CDSC schedule (or period)
following an exchange if such schedule is higher (or longer) than the CDSC for
the new Class B shares.

Class I shareholders may exchange their outstanding Class I shares for Class
I shares of another Ivy or Mackenzie Fund on the basis of the relative NAV per
Class I share.

Shares resulting from the reinvestment of dividends and other distributions
will not be charged an initial sales charge or a CDSC when exchanged into
another Ivy or Mackenzie Fund.

Exchanges are considered to be taxable events, and may result in a capital
gain or a capital loss for tax purposes. Before executing an exchange, you
should obtain and read the prospectus and consider the investment objective of
the fund to be purchased. Shares must be uncertificated in order to execute a
telephone exchange. Exchanges are available only in states where they can be
legally made. This privilege is not intended to provide shareholders a means by
which to speculate on short-term movements in the market. The Funds reserve the
right to limit the frequency of exchanges. Exchanges are accepted only if the
registrations of the two accounts are identical. Amounts to be exchanged must
meet minimum investment requirements for the Ivy or Mackenzie Fund into which
the exchange is made.

With respect to shares subject to a CDSC, if less than all of an investment
is exchanged out of a Fund, the shares exchanged will reflect, pro rata, the
cost, capital appreciation and/or reinvestment of distributions of the original
investment as well as the original purchase date, for purposes of calculating
any CDSC for future redemptions of the exchanged shares.

Investors who held Ivy Fund shares as of December 31, 1991, or who held
shares of certain funds that were reorganized into an Ivy or Mackenzie fund, may
be exempt from sales charges on the exchange of shares between any of the Ivy or
Mackenzie funds. If you believe you may be eligible for such an exemption,
please contact IMSC at 1-800-235-3322 for additional information.

In calculating the sales charge assessed on an exchange, shareholders will
be allowed to use the Rights of Accumulation privilege.

EXCHANGES BY TELEPHONE: If Section 6D of the Account Application is not
completed, telephone exchange privileges will be provided automatically.
Although telephone exchanges may be a convenient feature, you should realize
that you may be giving up a measure of security that you may otherwise have if
you terminated the privilege and exchanged your shares in writing. If you do not
wish to make telephone exchanges or let your registered representative do so on
your behalf, you must notify IMSC in writing.

In order to execute an exchange, please contact IMSC at 1-800-777-6472. Have
the account number of your current fund and the exact name in which it is
registered available to give to the telephone representative.

Each Fund employs reasonable procedures that require personal identification
prior to acting on exchange instructions communicated by telephone to confirm
that such instructions are genuine. In the absence of such procedures, a Fund
may be liable for any losses due to unauthorized or fraudulent telephone
instructions.

EXCHANGES IN WRITING: In a letter, request an exchange and provide the
following information:

- - The name and class of the fund whose shares you currently own.

- - Your account number.

- - The name(s) in which the account is registered.

- - The name of the fund in which you wish your exchange to be invested.

- - The number of shares or the dollar amount you wish to exchange.

The request must be signed by all registered owners.

REINVESTMENT PRIVILEGE

Investors who have redeemed Class A shares of a Fund have a one-time
privilege of reinvesting all or a part of the proceeds of the redemption back
into Class A shares of that Fund at NAV (without a sales charge) within 60 days
after the date of redemption. IN ORDER TO REINVEST WITHOUT A SALES CHARGE,
SHAREHOLDERS OR THEIR BROKERS MUST INFORM IMSC THAT THEY ARE EXERCISING THE
REINVESTMENT PRIVILEGE AT THE TIME OF REINVESTMENT. The tax status of a gain
realized on a redemption generally will not be affected by the exercise of the
reinvestment privilege, but a loss realized on a redemption generally may be
disallowed by the IRS if the reinvestment privilege is exercised within 30 days
after the redemption. In addition, upon a reinvestment, the shareholder may not
be permitted to take into account sales charges incurred on the original
purchase of shares in computing their taxable gain or loss.

SYSTEMATIC WITHDRAWAL PLAN

You may elect the Systematic Withdrawal Plan at any time by completing the
Account Application, which is attached to this Prospectus. You can also obtain
this application by contacting your registered representative or IMSC at
1-800-777-6472. To be eligible, you must have at least $5,000 in your account.
Payments (minimum distribution amount -- $50) from your account can be made
monthly, quarterly, semi-annually, annually or on a selected monthly basis, to
yourself or any other designated payee. You may elect to have your systematic
withdrawal paid directly to your bank account via EFT, at no charge. Share
certificates must be unissued (i.e., held by a Fund) while the plan is in
effect. A Systematic Withdrawal Plan may not be established if you are currently
participating in the Automatic Investment Method. For more information, please
contact IMSC at 1-800-777-6472.

If payments you receive through the Systematic Withdrawal Plan exceed the
dividends and capital appreciation of your account, you will be reducing the
value of your account. Additional investments made by shareholders participating
in the Systematic Withdrawal Plan must equal at least $1,000 while the plan is
in effect. However, it may not be advantageous to purchase additional Class A,
Class B or Class C shares when you have a Systematic Withdrawal Plan, because
you may be subject to an initial sales charge on your purchase of

29
<PAGE> 30

Class A shares or to a CDSC imposed on your redemptions of Class B or Class C
shares. In addition, redemptions are taxable events.

Amounts paid to you through the Systematic Withdrawal Plan are derived from
the redemption of shares in your account. Any applicable CDSC will be assessed
upon the redemptions. A CDSC will not be assessed on withdrawals not exceeding
12% annually of the initial account balance when the Systematic Withdrawal Plan
was started.

Should you wish at any time to add a Systematic Withdrawal Plan to an
existing account or change payee instructions, you will need to submit a written
request, signed by all registered owners, with signatures guaranteed.

Retirement accounts are eligible for Systematic Withdrawal Plans. Please
contact IMSC at 1-800-777-6472 to obtain the necessary paperwork to establish a
plan.

If the U.S. Postal Service cannot deliver your checks, or if deposits to a
bank account are returned for any reason, your redemptions will be discontinued.

AUTOMATIC INVESTMENT METHOD

You may authorize an investment to be automatically drawn each month from
your bank for investment in Fund shares by completing Sections 6A and 7B of the
Account Application. Attach a "voided" check to your account application. At
pre-specified intervals, your bank account will be debited and the proceeds will
be credited to your Ivy Fund account. The minimum investment under this plan is
$50 per month ($25 per month for retirement plans). There is no charge to you
for this program.

You may terminate or suspend your Automatic Investment Method by telephone
at any time by contacting IMSC at 1-800-777-6472.

If you have investments being withdrawn from a bank account and we are
notified that the account has been closed, your Automatic Investment Method will
be discontinued.

CONSOLIDATED ACCOUNT STATEMENTS

Shareholders with two or more Ivy or Mackenzie fund accounts having the same
taxpayer I.D. number will receive a single quarterly account statement, unless
otherwise specified. This feature consolidates the activity for each account
onto one statement. Requests for quarterly consolidated statements for all other
accounts must be submitted in writing and must be signed by all registered
owners.

RETIREMENT PLANS

The Ivy and Mackenzie family of funds offer several tax-sheltered retirement
plans that may fit your needs:

- IRA (Individual Retirement Account)

- 401(k), Money Purchase Pension and Profit Sharing Plans

- SEP-IRA (Simplified Employee Pension Plan)

- 403(b)(7) Plan

- SIMPLE Plans (Individual Retirement Account and 401(k))

Minimum initial and subsequent investments for retirement plans are $25.

Investors Bank & Trust, which serves as custodian or trustee under the
retirement plan prototypes available from each Fund, charges certain nominal
fees for annual maintenance. A portion of these fees is remitted to IMSC, as
compensation for its services to the retirement plan accounts maintained with
each Fund.

Distributions from retirement plans are subject to certain requirements
under the Code. Certain documentation, including IRS Form W4-P, must be provided
to IMSC prior to taking any distribution. Please contact IMSC for details. The
Ivy and Mackenzie family of funds and IMSC assume no responsibility to determine
whether a distribution satisfies the conditions of applicable tax laws, and will
not be responsible for any penalties assessed. For additional information,
please contact your broker, tax adviser or IMSC.

Please call IMSC at 1-800-777-6472 for complete information kits describing
the plans, their benefits, restrictions, provisions and fees.

SHAREHOLDER INQUIRIES

Inquiries regarding the Funds should be directed to IMSC at 1-800-777-6472.

30
<PAGE> 31
ACCOUNT APPLICATION

IVY ASIA PACIFIC FUND IVY GLOBAL SCIENCE &
IVY CANADA FUND TECHNOLOGY FUND
IVY CHINA REGION FUND IVY INTERNATIONAL FUND
IVY GLOBAL FUND IVY INTERNATIONAL SMALL _________________
IVY GLOBAL NATURAL COMPANIES FUND ACCOUNT NUMBER
RESOURCES FUND IVY LATIN AMERICA STRATEGY FUND
IVY NEW CENTURY FUND

PLEASE MAIL APPLICATIONS AND CHECKS TO: Ivy Mackenzie Services Corp.,
P.O. Box 3022, Boca Raton, FL 33431-0922.
(This application should not be used for retirement accounts for which Ivy is
custodian.)
<TABLE>
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- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
FUND USE ONLY
101/ 1 / 2 1 / 2 0 / 1 0 / X
- ----------------------- --------- --------- ------------ -------- ---------- --------- --------- ------------
Dealer # Branch # Rep # Acct Type Soc Cd Div Cd CG Cd Exc Cd Red Cd
- ------------------------------------------------------------------------------------------------------------------------------------
1 REGISTRATION

[ ] Individual ________________________________________________________________________________________
[ ] Joint Tenant Owner, Custodian or Trustee
[ ] Estate ________________________________________________________________________________________
[ ] UGMA/UTMA Co-owner or Minor
[ ] Corporation ________________________________________________________________________________________
[ ] Partnership Minor's State of Residence
[ ] Sole Proprietor ________________________________________________________________________________________
[ ] Trust Street
__________________ ________________________________________________________________________|__|__|__|__|__|
Date of Trust City State Zip Code
|__|__|__|-|__|__|__|-|__|__|__|__| |__|__|__|-|__|__|__|-|__|__|__|__|
Phone Number -- Day Phone Number -- Evening
[ ] Other ____________
__________________

- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
2 TAX ID #

|__|__|__|-|__|__|-|__|__|__|__| or |__|__|-|__|__|__|__|__|__|__| Citizenship: [ ] U.S. [ ] Other _______________
Social Security Number Tax Identification Number

Under penalties of perjury, I certify by signing in Section 8 below that: (1) the number shown in this section is my correct
taxpayer identification number (TIN), and (2) I am not subject to backup withholding because: (a) I have not been notified by the
Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends,
or (b) the IRS has notified me that I am no longer subject to backup withholding. (Cross out item (2) if you have been notified by
the IRS that you are currently subject to backup withholding because of underreporting interest or dividends on your tax return.)
Please see the "Tax Identification Number" section of the Prospectus for additional information on completing this section.
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
3 DEALER INFORMATION

The undersigned ("Dealer") agrees to all applicable provisions in this Application, guarantees the signature and legal capacity of
the Shareholder, and agrees to notify IMSC of any purchases made under a Letter of Intent or Rights of Accumulation.

__________________________________________________________ __________________________________________________________
Dealer Name Representative's Name and Number

__________________________________________________________ __________________________________________________________
Branch Office Address Representative's Phone Number

__________________________________________________________ __________________________________________________________
City State Zip Code Authorized Signature of Dealer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
4 INVESTMENTS

A. Enclosed is my check for $______ ($1,000 minimum) made payable to the appropriate Fund.

B. Please invest in [ ] Class A shares [ ] Class B shares [ ] Class C shares [ ] Class I shares ("*" Funds only)
of the following Fund(s):

$______________ Ivy Asia Pacific Fund $______________ Ivy Global Science & Technology Fund*
$______________ Ivy Canada Fund $______________ Ivy International Fund*
$______________ Ivy China Region Fund $______________ Ivy International Small Companies Fund*
$______________ Ivy Global Fund $______________ Ivy Latin America Strategy Fund
$______________ Ivy Global Natural Resources Fund $______________ Ivy New Century Fund

C. I qualify for a reduced sales charge due to the following privilege (applies only to Class A shares):
[ ] New Letter of Intent (if ROA or 90-day backdate privilege is applicable, provide account(s) information below.)
[ ] ROA with the account(s) listed below.
[ ] Existing Letter of Intent with account(s) listed below.

_____________________________________________________ |__|__|__|__|__|__|__|__|__|__| [ ] or New
Fund Name Account Number
_____________________________________________________ |__|__|__|__|__|__|__|__|__|__| [ ] or New
Fund Name Account Number

If establishing a Letter of Intent, you will need to purchase Class A shares over a thirteen-month period in accordance with
the provisions in the Prospectus. The aggregate amount of these purchases will be at least equal to the amount indicated below
(see Prospectus for minimum amount required for reduced sales charges.)

[ ] $50,000 [ ] $100,000 [ ] $250,000 [ ] $500,000

D. FOR DEALER USE ONLY
Confirmed trade orders: |__|__|__|__|__|__| |__|__|__|__|__|__| - |__|__|__| |__|__|__|__|__|__|
Confirm Number Number of Shares Trade Date
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
5 DISTRIBUTION OPTIONS

A. I would like to reinvest dividends and capital gains into additional shares of the same class in this account at net asset
value unless a different option is checked below.

B. [ ] Reinvest all dividends and capital gains into additional shares of the same class in an account in a different Ivy or
Mackenzie fund.

_____________________________________ |__|__|__|__|__|__|__|__|__|__| [ ] New Account
Fund Name Account Number

C. [ ] Pay all dividends in cash and reinvest capital gains into additional shares of the same class in this account or an account
in a different Ivy or Mackenzie fund.

_____________________________________ |__|__|__|__|__|__|__|__|__|__| [ ] New Account
Fund Name Account Number

D. [ ] Pay all dividends and capital gains in cash.

I REQUEST THE ABOVE CASH DISTRIBUTION, SELECTED IN C OR D ABOVE, BE:

[ ] Sent to the address listed in the registration. [ ] Sent to the special payee listed in Section 7A [ ] (By Mail)
7B [ ] (By E.F.T.)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 32
<TABLE>
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<S> <C>
6 OPTIONAL SPECIAL FEATURES

A. [ ] AUTOMATIC INVESTMENT METHOD (AIM)

I wish to invest [ ] once per month. My bank account will be debited on or about the
[ ] twice ______________ day of the month(*)
[ ] 3 times ______________ day of the month
[ ] 4 times ______________ day of the month
______________ day of the month

Please invest $_____________ each period starting in the month of _______ in [ ] Class A [ ] Class B or
Dollar Amount Month [ ] Class C of _________________________ .
Fund Name

[ ] I have attached a voided check to ensure my correct bank account will be debited.

B. [ ] SYSTEMATIC WITHDRAWAL PLANS**
I wish to automatically withdraw funds from my account in Class A [ ] Class B [ ] or Class C [ ] of _______________________
Fund Name
[ ] Once [ ] Twice [ ] 3 times [ ] 4 times per month

[ ] Monthly [ ] Quarterly [ ] Semianually [ ] Annually

I request the distribution be:
[ ] Sent to the address listed in the registration.
[ ] Sent to the special payee listed in Section 7.
[ ] Invested into additional shares of the same
class of a different Ivy or Mackenzie fund: _______________________________
Fund Name

|__|__|__|__|__|__|__|__|__|__|
Account Number

Amount $ _______________, starting on or about the _______________day of ________________________
Minimum $50 month
_______________day of ________________________
month
_______________day of ________________________
month*

NOTE: Account minimum: $5,000 in shares at current offering price

C. [ ] FEDERAL FUNDS WIRE FOR REDEMPTION PROCEEDS**
I authorize the Agent to honor telephone instructions for the redemption of Fund shares up to $50,000. Proceeds may be
wire transferred to the bank account designated ($1,000 minimum). (COMPLETE SECTION 7B)

D. [ ] TELEPHONIC EXCHANGES** [ ] YES [ ] NO
I authorize exchanges by telephone among the Ivy and Mackenzie family of funds, upon instructions from any person as more
fully described in the Prospectus. To change this option once established, written instructions must be received from the
shareholder of record or the current registered representative.

If neither box is checked, the telephone exchange privilege will be provided automatically.

E. [ ] TELEPHONIC REDEMPTIONS** [ ] YES [ ] NO
The Fund or its agents are authorized to honor telephone instructions from any person as more fully described in the
Prospectus for the redemption of Fund shares. The amount of the redemption shall not exceed $50,000 and the proceeds
are to be payable to the shareholder of record and mailed to the address of record. To change this option once established,
written instructions must be received from the shareholder of record or the current registered representative.

If neither box is checked, the telephone exchange privilege will be provided automatically.

* There must be a period of at least seven calendar days between each investment/withdrawal period.
** This option may not be selected if shares are issued in certificate form.
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
7 SPECIAL PAYEE

A. MAILING ADDRESS B. FED WIRE / E.F.T. INFORMATION
- -----------------------------------------------------------------------------------------------------------------------------
Please send all disbursements to this special payee

------------------------------------------------------- ----------------------------------------------------
Name of Bank or Individual Financial Institution

------------------------------------------------------- ---------------------------- ---------------------
Account Number (if applicable) ABA # Account #

------------------------------------------------------- ----------------------------------------------------
Street Street

------------------------------------------------------- ----------------------------------------------------
City/State/Zip City/State/Zip
(Please attach a voided check)
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
8 SIGNATURES

Investors should be aware that failure to check "No" under Section 6D and 6E above means that the Telephone Exchange/Redemptions
Privileges will be provided. The Funds employ reasonable procedures that require personal identification prior to acting on
exchange/redemption instructions communicated by telephone to confirm that such instructions are genuine. In the absence of such
procedures, a Fund may be liable for any losses due to unauthorized or fraudulent telephone instructions. Please see "Exchange
Privilege" and "How to Redeem Shares" in the Prospectus for more information on these privileges.

I certify to my legal capacity to purchase or redeem shares of the Fund for my own account or for the account of the organization
named in Section 1. I have received a current Prospectus and understand its terms are incorporated in this application by
reference. I am certifying my taxpayer information as stated in Section 2.

THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE YOUR CONSENT TO ANY PROVISION OF THIS DOCUMENT OTHER THAN THE CERTIFICATION REQUIRED
TO AVOID BACKUP WITHHOLDING.

- --------------------------------------------------------------------------- ------------------
Signature of Owner, Custodian, Trustee or Corporate Officer Date

- --------------------------------------------------------------------------- ------------------
Signature of Joint Owner, Co-Trustee or Corporate Officer Date
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
INTL-1-496 (REMEMBER TO SIGN SECTION 8)

IVY ASIA PACIFIC FUND
IVY CANADA FUND
IVY CHINA REGION FUND
IVY GLOBAL FUND
IVY GLOBAL NATURAL RESOURCES FUND
IVY GLOBAL SCIENCE & TECHNOLOGY FUND
IVY INTERNATIONAL FUND
IVY INTERNATIONAL SMALL COMPANIES FUND
IVY LATIN AMERICA STRATEGY FUND
IVY NEW CENTURY FUND

series of

IVY FUND
Via Mizner Financial Plaza, Suite 300
700 South Federal Highway
Boca Raton, Florida 33432

STATEMENT OF ADDITIONAL INFORMATION

January 1, 1997

_________________________________________________________________

Ivy Fund (the "Trust") is an open-end management
investment company that currently consists of sixteen
fully managed portfolios, each of which (except for Ivy
Latin America Strategy Fund) is diversified. Ivy Latin
America Strategy Fund is a non- diversified portfolio.
This Statement of Additional Information ("SAI")
describes ten of the portfolios, Ivy Asia Pacific Fund,
Ivy Canada Fund, Ivy China Region Fund, Ivy Global Fund, Ivy
Global Natural Resources Fund, Ivy Global Science &
Technology Fund, Ivy International Fund, Ivy
International Small Companies Fund, Ivy Latin America
Strategy Fund and Ivy New Century Fund (the "Funds,"
each a "Fund"). The other six portfolios of the Trust
are described in separate Statements of Additional
Information.

This SAI is not a prospectus and should be read in
conjunction with the prospectus for the Funds dated
January 1, 1997 (the "Prospectus"), which may be
obtained upon request and without charge from the Trust
at the Distributor's address and telephone number
listed below.

INVESTMENT MANAGER

Ivy Management, Inc. ("IMI")
Via Mizner Financial Plaza, Suite 300
700 South Federal Highway
Boca Raton, Florida 33432
Telephone: (800) 777-6472

DISTRIBUTOR

Ivy Mackenzie Distributors, Inc.
Via Mizner Financial Plaza, Suite 300
700 South Federal Highway
Boca Raton, Florida 33432
Telephone: (800) 456-5111

INVESTMENT ADVISER

(Ivy Canada Fund and Ivy Global Natural Resources
Fund only) Mackenzie Financial
Corporation 150 Bloor Street
West
Suite 400
Toronto, Ontario
CANADA M5S3B5
Telephone (416) 922-5322

TABLE OF CONTENTS

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . .
. . . 6

RISK FACTORS . . . . . . . . . . . . . . . . . . . . .
. . . 19 U.S. GOVERNMENT SECURITIES . . . . . . .
. . . . . . . . 19 CONVERTIBLE SECURITIES . . . .
. . . . . . . . . . . . . 20 DEBT SECURITIES, IN
GENERAL . . . . . . . . . . . . . . 21 ZERO
COUPON BONDS . . . . . . . . . . . . . . . . . . . 21
REPURCHASE AGREEMENTS . . . . . . . . . . . . . . . . . 22
WARRANTS . . . . . . . . . . . . . . . . . . . . . .
. . 22 SMALL COMPANIES . . . . . . . . . . . . .
. . . . . . . 22

COMMERCIAL PAPER . . . . . . . . . . . . . . . . . . .
. . . 23 BANKING INDUSTRY AND SAVINGS AND LOAN
OBLIGATIONS . . . 23 DEPOSITORY RECEIPTS . . .
. . . . . . . . . . . . . . . 23 INVESTMENT GRADE
DEBT SECURITIES . . . . . . . . . . . . 23 LOW-
RATED DEBT SECURITIES . . . . . . . . . . . . . . . 24
FOREIGN SECURITIES . . . . . . . . . . . . . . . . . . . 25
INVESTING IN EMERGING MARKETS . . . . . . . . . .
. . . 26 CANADIAN SECURITIES . . . . . . . . . .
. . . . . . . . 28 INVESTING IN LATIN AMERICA . .
. . . . . . . . . . . . . 29 INVESTING IN ASIA
PACIFIC SECURITIES . . . . . . . . . . 31
INVESTING IN NATURAL RESOURCES . . . . . . . . . . . . . 32
INVESTING IN THE CHINA REGION . . . . . . . . . . . . .
34 PRECIOUS METALS AND OTHER PHYSICAL COMMODITIES
. . . . . 35 FORWARD FOREIGN CURRENCY CONTRACTS .
. . . . . . . . . . 35 FOREIGN CURRENCIES . . . .
. . . . . . . . . . . . . . . 36 REAL ESTATE
INVESTMENT TRUSTS (REITs) . . . . . . . . . 37
OPTIONS TRANSACTIONS . . . . . . . . . . . . . . . . . . 37
OPTIONS, IN GENERAL . . . . . . . . . . . . . . . .
37 WRITING OPTIONS ON INDIVIDUAL SECURITIES
. . . . . 39 PURCHASING OPTIONS ON
INDIVIDUAL SECURITIES . . . . 39 PURCHASING
AND WRITING OPTIONS ON SECURITIES
INDICES . . . . . . . . . . . . . . . . . . . 40
RISKS OF OPTIONS TRANSACTIONS . . . . . . . . . . . 41
FUTURES CONTRACTS . . . . . . . . . . . . . . . . . . .
42 FUTURES, IN GENERAL. . . . . . . . . . .
. . . . . 42 FOREIGN CURRENCY FUTURES
CONTRACTS. . . . . . . . . 43 RISKS
ASSOCIATED WITH FUTURES. . . . . . . . . . . 43
SECURITIES INDEX FUTURES CONTRACTS . . . . . . . . . . . 44
RISKS OF SECURITIES INDEX FUTURES . . . . . . . . .
45 COMBINED TRANSACTIONS . . . . . . .
. . . . . 46 FIRM COMMITMENT AGREEMENTS AND WHEN-
ISSUED SECURITIES . 47 RESTRICTED AND ILLIQUID
SECURITIES . . . . . . . . . . . 47 BORROWING .
. . . . . . . . . . . . . . . . . . . . . . 48
LOANS OF PORTFOLIO SECURITIES . . . . . . . . . . . . . 48

INVESTMENT RESTRICTIONS . . . . . . . . . . . . . . . .
. . . 48

ADDITIONAL RESTRICTIONS . . . . . . . . . . . . . . . .
. . . 54

ADDITIONAL RIGHTS AND PRIVILEGES . . . . . . . . . . .
. . . 56

AUTOMATIC INVESTMENT METHOD . . . . . . . . . . .
. . . 57 EXCHANGE OF SHARES . . . . . . . . . . .
. . . . . . . . 57 INITIAL SALES CHARGE
SHARES . . . . . . . . . . . . 57 CONTINGENT
DEFERRED SALES CHARGE SHARES. CLASS A . 57
CLASS B . . . . . . . . . . . . . . . . . . . . . . 58
CLASS C . . . . . . . . . . . . . . . . . . . . . . 59
CLASS I . . . . . . . . . . . . . . . . . . . .
. . 60 ALL CLASSES . . . . . . . . . . . . .
. . . . . . . 60 LETTER OF INTENT . . . . . . . .
. . . . . . . . . . . . 60 RETIREMENT PLANS . . .
. . . . . . . . . . . . . . . . . 61
INDIVIDUAL RETIREMENT ACCOUNTS . . . . . . . . . . 62
QUALIFIED PLANS . . . . . . . . . . . . . . . . . . 63
DEFERRED COMPENSATION FOR PUBLIC SCHOOLS AND
CHARITABLE ORGANIZATIONS ("403(B)(7)
ACCOUNT") . . . . . . . . . . . . . . . . . .
64 SIMPLIFIED EMPLOYEE PENSION ("SEP") IRAS
. . . . . 65 REINVESTMENT PRIVILEGE . . . . . . .
. . . . . . . . . . 65 RIGHTS OF ACCUMULATION . .
. . . . . . . . . . . . . . . 66 SYSTEMATIC
WITHDRAWAL PLAN . . . . . . . . . . . . . . . 67
GROUP SYSTEMATIC INVESTMENT PROGRAM . . . . . . . . . . 67

BROKERAGE ALLOCATION . . . . . . . . . . . . . . . . .
. . . 68 TRUSTEES AND OFFICERS .
. . . . . . . . 71 PERSONAL INVESTMENTS BY
EMPLOYEES OF IMI . . . . . . . . 75 COMPENSATION
TABLE . . . . . . . . . . . . . . . . . . . 76

INVESTMENT ADVISORY AND OTHER SERVICES . . . . . . . .
. . . 78 BUSINESS MANAGEMENT AND INVESTMENT
ADVISORY SERVICES . . 78 SUBADVISORY
CONTRACT - IVY INTERNATIONAL FUND . . 82
DISTRIBUTION SERVICES . . . . . . . . . . . . . . . . . 83
RULE 18F-3 PLAN . . . . . . . . . . . . . . . . . .
86 RULE 12B-1 DISTRIBUTION PLANS . . . . . .
. . . . . 87 CUSTODIAN . . . . . . . . . . . . .
. . . . . . . . . . 92 FUND ACCOUNTING SERVICES .
. . . . . . . . . . . . . . . 93 TRANSFER AGENT
AND DIVIDEND PAYING AGENT . . . . . . . . 94
ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . 94
AUDITORS . . . . . . . . . . . . . . . . . . . . . . . .
95

CAPITALIZATION AND VOTING RIGHTS . . . . . . . . . . .
. . . 95

NET ASSET VALUE . . . . . . . . . . . . . . . . . . . .
. . . 99

PORTFOLIO TURNOVER . . . . . . . . . . . . . . . . . .
. . . 100

REDEMPTIONS . . . . . . . . . . . . . . . . . . . . . .
. . . 101

CONVERSION OF CLASS B SHARES . . . . . . . . . . . . .
. . . 102

TAXATION . . . . . . . . . . . . . . . . . . . . . . .
. . . 103 OPTIONS, FUTURES AND FOREIGN CURRENCY
FORWARD CONTRACTS . . . . . . . . . . . . . .
. . . . . . . 104 CURRENCY FLUCTUATIONS --
"SECTION 988" GAINS OR LOSSES . . . . . .
. . . . . . . . . . . . . . . . . . . 105
INVESTMENT IN PASSIVE FOREIGN INVESTMENT COMPANIES . . . 106

DEBT SECURITIES ACQUIRED AT A DISCOUNT . . . . . .
. . . 106 DISTRIBUTIONS . . . . . . . . . . . . .
. . . . . . . . 108 DISPOSITION OF SHARES . . . .
. . . . . . . . . . . . . 108 FOREIGN WITHHOLDING
TAXES . . . . . . . . . . . . . . . 109 BACKUP
WITHHOLDING . . . . . . . . . . . . . . . . . . . 110

PERFORMANCE INFORMATION . . . . . . . . . . . . . . . .
. . . 110 AVERAGE ANNUAL TOTAL RETURN . . . .
. . . . . . . . 111 CUMULATIVE TOTAL RETURN .
. . . . . . . . . . . . . 121 OTHER
QUOTATIONS, COMPARISONS AND GENERAL
INFORMATION . . . . . . . . . . . . . . . . . 125

FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . .
. . . 126

APPENDIX A

DESCRIPTION OF STANDARD & POOR'S CORPORATION
("S&P") AND MOODY'S INVESTORS SERVICE, INC.
("MOODY'S") CORPORATE BOND AND
COMMERCIAL PAPER RATINGS . . . . . . . . 127

APPENDIX B

STATEMENT OF ASSETS AND LIABILITIES
AS OF DECEMBER 10, 1996
AND
REPORT OF INDEPENDENT ACCOUNTANTS . . .
. . . 130

APPENDIX C

SELECTED ECONOMIC AND MARKET DATA FOR
ASIA PACIFIC AND CHINA REGION COUNTRIES . . .
. 136

INVESTMENT OBJECTIVES AND POLICIES

Each Fund has its own investment objectives and
policies, which are set forth below. The different
types of securities and investment techniques used by
the Funds involve varying degrees of risk.

IVY ASIA PACIFIC FUND: The principal investment
objective of Ivy Asia Pacific Fund is long-term growth.
Consideration of current income is secondary to this
principal objective. Under normal circumstances the
Fund invests at least 65% of its total assets in
securities issued in Asia-Pacific countries, which for
purposes of this SAI are defined to include China, Hong Kong,
India, Indonesia, Malaysia, Pakistan, the Philippines,
Singapore, Sri Lanka, South Korea, Taiwan, Thailand and
Vietnam. Securities of Asia-Pacific issuers include:
(a) securities of companies organized under the laws of
an Asia-Pacific country or for which the principal
securities trading market is in the Asia-Pacific
region; (b) securities that are issued or guaranteed by the
government of an Asia-Pacific country, its agencies or
instrumentalities, political subdivisions or the country's
central bank; (c) securities of a company, wherever organized,
where at least 50% of the company's non-current assets,
capitalization, gross revenue or profit in any one of the
two most recent fiscal years represents (directly or
indirectly through subsidiaries) assets or activities
located in the Asia- Pacific region; and (d) any of the
preceding types of securities in the form of depository
shares.

The Fund may participate in markets throughout the
Asia- Pacific region, and it is expected that the Fund
will be invested at all times in at least three Asia-
Pacific countries. The Fund does not expect to
concentrate its investments in any particular industry,
but it may invest 25% or more of its total assets in
the securities of issuers located in any one Asia-Pacific
country. See Appendix C of this SAI for further information
about the economic characteristics of certain Asia-Pacific
countries.

The Fund may invest up to 35% of its assets in investment-
grade debt securities of government or corporate
issuers in emerging market countries, investment-grade
equity and debt securities of issuers in developed
countries (including the United States), warrants, and
cash or cash equivalents, such as bank obligations
(including certificates of deposit and bankers'
acceptances), commercial paper, short-term notes and repurchase
agreements. For temporary defensive purposes, the Fund
may invest without limit in such instruments. The Fund
may also invest up to 5% of its net assets in zero
coupon bonds, and in debt securities rated Ba or below
by Moody's Investor Services, Inc. ("Moody's) or BB or
below by Standard and Poor's Corporation ("S&P"), or if
unrated, are considered by IMI to be of comparable
quality (commonly referred to as "high yield" or "junk" bonds).

For temporary or emergency purposes, the Fund may
borrow up to one-third of the value of its total assets
from banks, but may not purchase securities at any time
during which the value of the Fund's outstanding loans
exceeds 10% of the value of the Fund's total assets.
The Fund may engage in foreign currency exchange
transactions and enter into forward foreign currency contracts.
The Fund may also invest (i) up to 10% of its total
assets in other investment companies that invest in
securities issued in Asia-Pacific countries, and (ii)
up to 15% of its net assets in restricted and other
illiquid securities. The Fund may with approval of its
Board of Trustees, but currently does not intend to,
lend portfolio securities.

The Fund may purchase put and call options on
securities and stock indices, provided the premium paid
for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options
with respect to up to 10% of the value of its net
assets, and may write covered call options so long as not
more than 25% of the Fund's net assets is subject to being
purchased upon the exercise of the calls. For hedging
purposes only, the Fund may engage in transactions in
stock index and foreign currency futures contracts,
provided that the Fund's aggregate investment in such
contracts does not exceed 15% of its total assets.

IVY CANADA FUND: Ivy Canada Fund seeks long-term
capital appreciation by investing primarily in equity
securities of Canadian companies. Canada is one of the
world's leading industrial countries and a major
exporter of agricultural products. The country is rich
in natural resources such as zinc, uranium, nickel,
gold, silver, aluminum, iron and copper, and forest
covers over 44% of land areas, making Canada a leading
world producer of newsprint. Canada is also a major producer of
hydroelectricity, oil and gas.

To meet its objective, the Fund normally invests
at least 65% of its total assets in Canadian equity
securities (i.e., common and preferred stock,
securities convertible into common stock and common
stock purchase warrants) listed on Canadian stock
exchanges or traded over-the-counter in Canada. Canadian
issuers are companies (i) organized under the laws of Canada,
(ii) for which the principal securities trading market is in
Canada, (iii) which derive at least 50% of their
revenues or profits from goods produced or sold,
investments made or services performed in Canada, or
(iv) which have at least 50% of their assets situated
in Canada. The balance of the Fund's assets ordinarily
are invested in (i) bills and bonds of the Canadian
Government and the governments of the provinces or municipalities
of Canada, (ii) high quality notes and debentures of
Canadian companies (i.e., those rated Aaa or Aa by
Moody's or AAA or AA by S&P, or if not rated, judged to
be of comparable quality by Mackenzie Financial
Corporation ("MFC"), the Fund's Adviser), (iii) foreign
securities (including sponsored or unsponsored American
Depository Receipts ("ADRs"), Global Depository Receipts

("GDRs"), American Depository Shares ("ADSs") and
Global Depository Shares ("GDSs")), (iv) U.S.
Government securities, (v) equity securities and
investment-grade debt securities (i.e., those rated Baa
or higher by Moody's or BBB or higher by S&P, or if
unrated, are considered by MFC to be of comparable quality) of
U.S. companies, and (vi) zero coupon bonds that meet these
credit quality standards.

The Fund may purchase securities on a "when-
issued" or firm commitment basis, engage in currency
exchange transactions and enter into forward foreign
currency contracts. The Fund may also invest (i) up to
10% of its total assets in other investment companies
and (ii) up to 15% of its net assets in restricted and
other illiquid securities.

For temporary defensive purposes, the Fund may
invest without limit in U.S. or Canadian dollar-
denominated money market securities issued by entities
organized in the U.S. or Canada, such as (i)
obligations issued or guaranteed by the Canadian
Government or the governments of the provinces or municipalities
of Canada (or their agencies or instrumentalities), (ii)
finance company and corporate commercial paper (and
other short-term corporate obligations rated Prime-1 by
Moody's or A or better by S&P, or if not rated,
considered by MFC to be of comparable quality), (iii)
obligations of banks (i.e., certificates of deposit,
time deposits and bankers' acceptances) of banks
considered creditworthy by MFC under guidelines approved by the
Trust's Board of Trustees, and (iv) repurchase agreements
with broker-dealers and banks. For temporary or
emergency purposes, the Fund may also borrow up to 10%
of the value of its total assets from banks.

IVY CHINA REGION FUND: Ivy China Region Fund's
principal investment objective is long-term capital
growth. Consideration of current income is secondary to
this principal objective. The Fund seeks to meet its
objective primarily by investing in the equity
securities of companies that are expected to benefit from
the economic development and growth of China, Hong Kong and
Taiwan. A significant percentage of the Fund's assets may
also be invested in the securities markets of South
Korea, Singapore, Malaysia, Thailand, Indonesia and the
Philippines (collectively, with China, Hong Kong and
Taiwan, the "China Region").

manufacturing or other operations in these countries.
IMI's determination as to whether a company qualifies
as a Greater China growth company is based primarily on
information contained in financial statements, reports,
analyses and other pertinent information (some of which
may be obtained directly from the company). The Fund
may invest 25% or more of its total assets in the
securities of issuers located in any one China Region
country, and currently expects to invest more than 50% of its
total assets in Hong Kong. See Appendix C to this SAI for
further information about the economic characteristics of
certain China Region countries.

The balance of the Fund's assets ordinarily are
invested in (i) certain investment-grade debt
securities and (ii) the equity securities of "China
Region associated companies," which are companies that
do not meet the definition of a Greater China growth
company, but whose current or expected performance, based
on certain identified factors (such as the growth trends in the
location of a company's assets and the sources of its
revenues and profits), is judged by IMI to be strongly
associated with the China Region. The investment-grade
debt securities in which the Fund may invest include
(a) obligations of the U.S. Government or its agencies
or instrumentalities, (b) obligations of U.S. banks and
other banks organized and existing under the laws of Hong
Kong, Taiwan or countries that are members of the Organization
for Economic Cooperation and Development ("OECD"), and (c)
obligations denominated in any currency issued by
international development institutions and Hong Kong,
Taiwan and OECD member governments and their agencies
and instrumentalities, as well as repurchase agreements
with respect to any of the foregoing instruments. The
Fund may also invest in zero coupon bonds, and
corporate bonds rated Baa or higher by Moody's or BBB or higher
by S&P (or if unrated, are considered by IMI to be of
comparable quality).

The Fund may invest less than 35% of its net
assets in debt securities rated Ba or below by Moody's
or BB or below by S&P, or, if unrated, are considered
by IMI to be of comparable quality (commonly referred
to as "high yield" or "junk" bonds). The Fund will not
invest in debt securities rated less than C by either
Moody's or S&P.

The Fund may with approval of its Board of
Trustees, but currently does not intend to, lend
portfolio securities valued at not more that 30% of the
Fund's total assets. The Fund may also invest in
sponsored or unsponsored ADRs, GDRs, ADSs and GDSs,
warrants, purchase securities on a "when-issued" or firm
commitment basis, engage in currency exchange transactions and
enter into forward foreign currency contracts. The Fund
may also invest (i) up to 10% of its total assets in
other investment companies and (ii) up to 15% of its
net assets in restricted and other illiquid
securities.

For temporary defensive purposes and during
periods when IMI believes that circumstances warrant,
the Fund may reduce its position in Greater China
growth companies and Greater China associated companies
and increase its investment in cash and liquid debt
securities, such as U.S. Government securities, bank
obligations, commercial paper, short-term notes and repurchase
agreements. For temporary or emergency purposes, the Fund
may also borrow up to 10% of the value of its total
assets from banks.

The Fund may purchase put and call options on
securities and stock indices, provided the premium paid
for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with
respect to up to 10% of the value of its net assets,
and may write covered call options so long as not more
than 25% of the Fund's net assets is subject to being
purchased upon the exercise of the calls. For hedging purposes
only, the Fund may engage in transactions in stock index
futures contracts, provided that the Fund's aggregate
investment in such contracts does not exceed 15% of its
total assets.

IVY GLOBAL FUND: The Fund seeks long-term capital
growth through a flexible policy of investing in stocks
and debt obligations of companies and governments of
any nation. Any income realized will be incidental.
Under normal conditions, the Fund will invest at least
65% of its total assets in the common stock of
companies throughout the world, with at least three
different countries (one of which may be the United States) will
be represented in the Fund's overall portfolio holdings.
Although the Fund generally invests in common stock, it
may also invest in preferred stocks, sponsored or
unsponsored ADRs, GDRs, ADSs and GDSs, and investment-
grade debt securities (i.e., those rated Baa or higher
by Moody's or BBB or higher by S&P, or if unrated, are
considered by IMI to be of comparable quality), including
corporate bonds, notes, debentures, convertible bonds and zero
coupon bonds.

The Fund may invest less than 35% of its net
assets in debt securities rated Ba or below by Moody's
or BB or below by S&P, or, if unrated, considered by
IMI to be of comparable quality (commonly referred to
as "high yield" or "junk" bonds). The Fund will not
invest in debt securities rated less than C by either
Moody's or S&P.

For temporary defensive purposes and during
periods when IMI believes that circumstances warrant,
the Fund may invest without limit in U.S. Government
securities, obligations issued by domestic or foreign
banks (including certificates of deposit, time deposits
and bankers' acceptances), and domestic or foreign
commercial paper (which, if issued by a corporation, must be
rated Prime-1 by Moody's or A-1 by S&P, or if unrated has
been issued by a company that at the time of investment
has an outstanding debt issue rated AAA or AA by S&P or
Aaa or Aa by Moody's). The Fund may also enter into
repurchase agreements, and, for temporary or emergency
purposes, may borrow up to 10% of the value of its
total assets from banks.

The Fund may purchase put and call options stock
indices, provided the premium paid for such options
does not exceed 10% of the Fund's net assets. The Fund
may also sell covered put options with respect to up to
50% of the value of its net assets, and may write
covered call options so long as not more than 20% of the
Fund's net assets is subject to being purchased upon the exercise
of the calls. For hedging purposes only, the Fund may
engage in transactions in (and options on) stock index
and foreign currency futures contracts, provided that
the Fund's aggregate investment in such contracts does
not exceed 20% of its total assets.

IVY GLOBAL NATURAL RESOURCES FUND: The Fund's
investment objective is long-term growth. Any income
realized will be incidental. Under normal conditions,
the Fund invests at least 65% of its total assets in
the equity securities of companies throughout the world
that own, explore or develop natural resources and
other basic commodities, or supply goods and services
to such companies. Under this investment policy, at
least three different countries (one of which may be the United
States) will be represented in the Fund's overall
portfolio holdings. "Natural resources" generally
include precious metals (such as gold, silver and
platinum), ferrous and nonferrous metals (such as iron,
aluminum and copper), strategic metals (such as uranium
and titanium), coal, oil, natural gases, timber,
undeveloped real property and agricultural commodities. Although
the Fund generally invests in common stock, it may also
invest in preferred stock, securities convertible into
common stock and sponsored or unsponsored ADRs, GDRs,
ADSs and GDSs. The Fund may also invest directly in
precious metals and other physical commodities.

IMI believes that certain political and economic
changes in the global environment in recent years have
had and will continue to have a profound effect on
global supply and demand of natural resources, and that
rising demand from developing markets and new sources
of supply should create attractive investment
opportunities. In selecting the Fund's investments, IMI will
seek to identify securities of companies that, in IMI's
opinion, appear to be undervalued relative to the value
of the companies' natural resource holdings.

For temporary defensive purposes, the Fund may
invest without limit in cash or cash equivalents, such
as bank obligations (including certificates of deposit
and bankers' acceptances), commercial paper, short-term
notes and repurchase agreements. For temporary or
emergency purposes, the Fund may borrow up to one-third
of the value of its total assets from banks, but may
not purchase securities at any time during which the
value of the Fund's outstanding loans exceeds 10% of the
value of the Fund's total assets. The Fund may engage in foreign
currency exchange transactions and enter into forward
foreign currency contracts. The Fund may also invest
(i) up to 10% of its total assets in other investment
companies and (ii) up to 15% of its net assets in
restricted and other illiquid securities. The Fund may
with approval of its Board of Trustees, but currently
does not intend to, lend portfolio securities.

For hedging purposes only, the Fund may engage in
transactions in (and options on) foreign currency futures
contracts, provided that the Fund's aggregate investment
in such contracts does not exceed 15% of its total
assets.

IVY GLOBAL SCIENCE & TECHNOLOGY FUND: The
principal investment objective of Ivy Global Science &
Technology Fund is long-term capital growth. Any
income realized will be incidental. Under normal
conditions, the Fund will invest at least 65% of its
total assets in the common stock of companies that are
expected to benefit from the development, advancement
and use of science and technology. Under this investment policy,
at least three different countries (one of which may be
the United States) will be represented in the Fund's
overall portfolio holdings. Industries likely to be
represented in the Fund's portfolio include computers
and peripheral products, software, electronic
components and systems, telecommunications, media and
information services, pharmaceuticals, hospital supply
and medical devices, biotechnology, environmental services,
chemicals and synthetic materials, and defense and aerospace.
The Fund may also invest in companies that are expected
to benefit indirectly from the commercialization of
technological and scientific advances. In recent
years, rapid advances in these industries have
stimulated unprecedented growth. While this is no
guarantee of future performance, IMI believes that
these industries offer substantial opportunities for long-term
capital appreciation.

Although the Fund generally invests in common
stock, it may also invest in preferred stock,
securities convertible into common stock, sponsored or
unsponsored ADRs, GDRs, ADSs and GDSs, and investment-
grade debt securities (i.e., those rated Baa or higher
by Moody's or BBB or higher by S&P, or if unrated, are
considered by IMI to be of comparable quality), including
corporate bonds, notes, debentures, convertible bonds and zero-
coupon bonds. The Fund may also invest up to 5% of its
net assets in debt securities that are rated Ba or
below by Moody's or BB or below by S&P, or if unrated,
are considered by IMI to be

of comparable quality (commonly referred to as "high
yield" or "junk" bonds). The Fund will not invest in
debt securities rated less than C by either Moody's or
S&P. (A description of the ratings assigned by Moody's
and S&P is contained in Appendix A to this SAI).

The Fund may with approval of its Board of
Trustees, but currently does not intend to, lend
portfolio securities valued at not more than 30% of the
Fund's total assets. The Fund may also invest in
warrants, purchase securities on a "when-issued" or
firm commitment basis, engage in currency exchange transactions
and enter into forward foreign currency contracts. The
Fund may also invest (i) up to 10% of its total assets
in other investment companies and (ii) up to 15% of its
net assets in restricted and other illiquid securities.

For temporary defensive purposes and during
periods when IMI believes that circumstances warrant,
the Fund may invest without limit in U.S. Government
securities, obligations issued by domestic or foreign
banks (including certificates of deposit, time deposits
and bankers' acceptances), and domestic or foreign
commercial paper (which, if issued by a corporation, must be
rated Prime-1 by Moody's or A-1 by S&P, or if unrated has
been issued by a company that at the time of investment
has an outstanding debt issue rated AAA or AA by S&P or
Aaa or Aa by Moody's). The Fund may also enter into
repurchase agreements, and, for temporary or emergency
purposes, may borrow up to 10% of the value of its
total assets from banks.

The Fund may purchase put and call options on
stock indices and on individual securities, provided
the premium paid for such options does not exceed 10%
of the value of the Fund's net assets. The Fund may
also sell covered put options with respect to up to 50%
of the value of its net assets, and may sell covered
call options so long as not more than 20% of the Fund's net
assets is subject to being purchased upon the exercise of the
calls. For hedging purposes only, the Fund may engage in
transactions in (and options on) stock index and foreign
currency futures contracts, provided that the Fund's
aggregate investment in such contracts does not exceed
20% of the value of its total assets.

IVY INTERNATIONAL FUND: The Fund's principal
objective is long-term capital growth primarily through
investment in equity securities. Consideration of
current income is secondary to this principal
objective. It is anticipated that at least 65% of the
Fund's total assets will be invested in common stocks (and
securities convertible into common stocks) principally traded
in European, Pacific Basin and Latin America markets.
Under this investment policy, at least three different
countries (other than the United States) will be
represented in the Fund's overall portfolio holdings.
For temporary defensive purposes, the Fund may also
invest in equity securities principally traded in U.S.
markets. The Fund's subadviser, Northern Cross Investments

Limited ("Northern Cross" or the "Subadviser"), invests
the Fund's assets in a variety of economic sectors,
industry segments and individual securities in order to
reduce the effects of price volatility in any one area
and to enable shareholders to participate in markets
that do not necessarily move in concert with U.S.
markets. The Subadviser seeks to identify rapidly
expanding foreign economies, and then searches out growing
industries and corporations, focusing on companies with
established records. Individual securities are selected based
on value indicators, such as a low price-earnings
ratio, and are reviewed for fundamental financial
strength. Companies in which investments are made will
generally have at least $1 billion in capitalization
and a solid history of operations.

When economic or market conditions warrant, the
Fund may invest without limit in U.S. Government
securities, investment- grade debt securities (i.e.,
those rated Baa or higher by Moody's or BBB or higher
by S&P, or if unrated, are considered by the Subadviser
to be of comparable quality), preferred stocks,
sponsored or unsponsored ADRs, GDRs, ADSs and GDSs, warrants, or
cash or cash equivalents such as bank obligations
(including certificates of deposit and bankers'
acceptances), commercial paper, short-term notes and
repurchase agreements. For temporary or emergency
purposes, the Fund may borrow up to 10% of the value of
its total assets from banks. The Fund may also purchase
securities on a "when-issued" or firm commitment basis.

The Fund may with approval of its Board of
Trustees, but currently does not intend to, lend
portfolio securities valued at not more that 30% of the
Fund's total assets. The Fund may also engage in
currency exchange transactions and enter into forward
foreign currency contracts. The Fund may also invest (i) up to
10% of its total assets in other investment companies and
(ii) up to 15% of its net assets in restricted and
other illiquid securities.

The Fund may purchase put and call options on
securities and stock indices, provided the premium paid
for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with
respect to up to 10% of the value of its net assets,
and may write covered call options so long as not more
than 25% of the Fund's net assets is subject to being
purchased upon the exercise of the calls. For hedging purposes
only, the Fund may engage in transactions in (and options
on) stock index and foreign currency futures contracts,
provided that the Fund's aggregate investment in such
contracts does not exceed 15% of its total assets.

into common stocks) of foreign issuers having total
market capitalization of less than $1 billion. Under
this investment policy, at least three different
countries (other than the United States) will be
represented in the Fund's overall portfolio holdings.
For temporary defensive purposes, the Fund may also
invest in equity securities principally traded in the United
States. The Fund will invest its assets in a variety of
economic sectors, industry segments and individual
securities in order to reduce the effects of price
volatility in any area and to enable shareholders to
participate in markets that do not necessarily move in
concert with the U.S. market. The factors that IMI
considers in determining the appropriate distribution of
investments among various countries and regions include prospects
for relative economic growth, expected levels of
inflation, government policies influencing business
conditions and the outlook for currency relationships.

In selecting the Fund's investments, IMI will seek
to identify securities that are attractively priced
relative to their intrinsic value. The intrinsic value
of a particular security is analyzed by reference to
characteristics such as relative price/earnings ratio,
dividend yield and other relevant factors (such as
applicable financial, tax, social and political
conditions).

When economic or market conditions warrant, the
Fund may invest without limit in U.S. Government
securities, investment- grade debt securities, zero
coupon bonds, preferred stocks, warrants, or cash or
cash equivalents such as bank obligations (including
certificates of deposit and bankers' acceptances),
commercial paper, short-term notes and repurchase agreements.
The Fund may also invest up to 5% of its net assets in debt
securities rated Ba or below by Moody's or BB or below
by S&P, or if unrated, are considered by IMI to be of
comparable quality (commonly referred to as "high
yield" or "junk" bonds).

For temporary or emergency purposes, the Fund may
borrow up to one-third of the value of its total assets
from banks, but may not purchase securities at any time
during which the value of the Fund's outstanding loans
exceeds 10% of the value of the Fund's assets. The
Fund may engage in foreign currency exchange
transactions and enter into forward foreign currency contracts.
The Fund may also invest (i) up to 10% of its total
assets in other investment companies and (ii) up to 15%
of its net assets in restricted and other illiquid
securities. The Fund may with approval of its Board of
Trustees, but currently does not intend to, lend
portfolio securities.

purchased upon the exercise of the calls. For hedging
purposes only, the Fund may engage in transactions in
stock index and foreign currency futures contracts,
provided that the Fund's aggregate investment in such
contracts does not exceed 15% of its total assets.

IVY LATIN AMERICA STRATEGY FUND: The Fund's
principal investment objective is long-term capital
growth. Consideration of current income is secondary
to this principal objective. Under normal conditions
the Fund invests at least 65% of its total assets in
securities issued in Latin America, which for purposes
of this Prospectus is defined as Mexico, Central
America, South America and the Spanish-speaking islands of the
Caribbean. Securities of Latin American issuers include
(a) securities of companies organized under the laws of
a Latin American country or for which the principal
securities trading market is in Latin America; (b)
securities that are issued or guaranteed by the
government of a Latin American country, its agencies or
instrumentalities, political subdivisions or the
country's central bank; (c) securities of a company, wherever
organized, where at least 50% of the company's non-current
assets, capitalization, gross revenue or profit in any one
of the two most recent fiscal years represents
(directly or indirectly through subsidiaries) assets or
activities located in Latin America; or (d) any of the
preceding types of securities in the form of depository
shares. The Fund may participate in markets throughout
Latin America, and it is expected that the Fund will be
invested at all times in at least three countries. Under
present conditions, the Fund expects to focus its investments in
Argentina, Brazil, Chile, Mexico and Venezuela, which IMI
believes are the most developed capital markets in Latin
America. The Fund does not expect to concentrate its
investments in any particular industry.

The Fund's equity investments consist of common
stock, preferred stock (either convertible or non-
convertible), sponsored or unsponsored ADRs, GDRs, ADSs
and GDSs, and warrants (any of which may be purchased
through rights). The Fund's equity securities may be
listed on securities exchanges, traded over- the-
counter, or have no organized market.

The Fund may invest in debt securities (including
zero coupon bonds) when IMI anticipates that the
potential for capital appreciation from debt securities
is likely to equal or exceed that of equity securities
(e.g., a favorable change in relative foreign exchange
rates, interest rate levels or the creditworthiness of
issuers). These include debt securities issued by Latin
American Governments ("Sovereign Debt"). Most of the
debt securities in which the Fund may invest are not rated,
and those that are rated are expected to be below investment-
grade (i.e., rated Ba or below by Moody's or BB or below
by S&P, or considered by IMI to be of comparable
quality), and are commonly referred to as "high yield"
or "junk" bonds.

To meet redemptions, or while the Fund is
anticipating investments in Latin American securities,
the Fund may hold cash or cash equivalents such as bank
obligations (including certificates of deposit and
banders' acceptances), commercial paper, short-term
notes and repurchase agreements. For temporary
defensive or emergency purposes, the Fund may (i) invest without
limit in such instruments, and (ii) borrow up to one-
third of the value of its total assets from banks (but
may not purchase securities at any time during which
the value of the Fund's outstanding loans exceeds 10%
of the value of the Fund's assets).

The Fund may with approval of its Board of
Trustees, but currently does not intend to, lend
portfolio securities valued at not more that 30% of the
Fund's total assets. The Fund may also invest in
warrants, purchase securities on a "when-issued" or
firm commitment basis, engage in currency exchange transactions
and enter into forward foreign currency contracts. The
Fund may also invest (i) up to 10% of its total assets
in other investment companies and (ii) up to 15% of its
net assets in restricted and other illiquid securities.
The Fund will treat any Latin American securities that
are subject to restrictions on repatriation for more
than seven days, as well as any securities issued in
connection with Latin American debt conversion programs
that are restricted to remittance of invested capital or profits,
as illiquid securities for purposes of this
limitation.

The Fund may purchase put and call options on
securities and stock indices, provided the premium paid
for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with
respect to up to 10% of the value of its net assets,
and may write covered call options so long as not more
than 25% of the Fund's net assets is subject to being
purchased upon the exercise of the calls. For hedging purposes
only, the Fund may engage in transactions in (and options
on) stock index and foreign currency futures contracts,
provided that the Fund's aggregate investment in such
contracts does not exceed 15% of its total assets.

IVY NEW CENTURY FUND: The Fund's principal
objective is long-term growth. Consideration of
current income is secondary to this principal
objective. In pursuing its objective, the Fund invests
primarily in the equity securities of companies that IMI
believes will benefit from the economic development and growth of
emerging markets. The Fund considers countries having
emerging markets to be those that (i) are generally
considered to be "developing" or "emerging" by the
World Bank and the International Finance Corporation,
or (ii) are classified by the United Nations (or
otherwise regarded by their authorities) as "emerging."
Under normal market conditions, the Fund invests at
least 65% of its total assets in equity securities (including
common and preferred stocks, convertible debt obligations,
warrants, options, rights and sponsored or unsponsored
ADRs, GDRs ADSs and GDSs that are listed on stock
exchanges or traded over- the-counter) of "Emerging
Market growth companies," which are

defined as companies (a) for which the principal
securities trading market is an emerging market (as
defined above), (b) that (alone or on a consolidated
basis) derives 50% or more of its total revenue either
from goods, sales or services in emerging markets, or
(c) that are organized under the laws of (and with a
principal office in) an emerging market country.

The Fund normally invests its assets in the
securities of issuers located in at least three
emerging market countries, and may invest 25% or more
of its total assets in the securities of issuers
located in any one country. IMI's determination as to
whether a company qualifies as a Emerging Markets growth company
is based primarily on information contained in financial
statements, reports, analyses and other pertinent
information (some of which may be obtained directly
from the company).

For purposes of capital appreciation, the Fund may
invest up to 35% of its assets in (i) debt securities
of government or corporate issuers in emerging market
countries, (ii) equity and debt securities of issuers
in developed countries (including the United States),
and (iii) cash or cash equivalents such as bank
obligations (including certificates of deposit and banders'
acceptances), commercial paper, short-term notes and
repurchase agreements. For temporary defensive
purposes, the Fund may invest without limit in such
instruments. The Fund may also invest in zero coupon
bonds and purchase securities on a "when-issued" or
firm commitment basis.

The Fund will not invest more than 20% of its
total assets in debt securities rated Ba or lower by
Moody's or BB or lower by S&P, or if unrated, are
considered by IMI to be of comparable quality (commonly
referred to as "high yield" or "junk" bonds).

For temporary or emergency purposes, the Fund may
borrow up to one-third of the value of its total assets
from banks, but may not purchase securities at any time
during which the value of the Fund's outstanding loans
exceeds 10% of the value of the Fund's assets. The
Fund may with approval of its Board of Trustees, but
currently does not intend to, lend portfolio securities valued at
not more that 30% of the Fund's total assets, engage in
currency exchange transactions and enter into forward
foreign currency contracts. The Fund may also invest
(i) up to 10% of its total assets in other investment
companies, and (ii) up to 15% of its net assets in
restricted and other illiquid securities.

The Fund may purchase put and call options on
securities and stock indices, provided the premium paid
for such options does not exceed 5% of the Fund's net
assets. The Fund may also sell covered put options with
respect to up to 10% of the value of its net assets,
and may write covered call options so long as not more
than 25% of the Fund's net assets is subject to being
purchased upon the exercise of the calls. For hedging purposes
only, the Fund may engage in transactions in (and options
on) stock index and foreign currency futures contracts,
provided that

the Fund's aggregate investment in such contracts does
not exceed 15% of its total assets.

RISK FACTORS

U.S. GOVERNMENT SECURITIES

U.S. Government securities are obligations of, or
guaranteed by, the U.S. Government, its agencies or
instrumentalities. Securities guaranteed by the U.S.
Government include: (1) direct obligations of the U.S.
Treasury (such as Treasury bills, notes, and bonds) and
(2) Federal agency obligations guaranteed as to
principal and interest by the U.S. Treasury (such as GNMA
certificates, which are mortgage-backed securities). When such
securities are held to maturity, the payment of principal
and interest is unconditionally guaranteed by the U.S.
Government, and thus they are of the highest possible
credit quality. U.S. Government securities that are
not held to maturity are subject to variations in
market value due to fluctuations in interest rates.

Mortgage-backed securities are securities
representing part ownership of a pool of mortgage
loans. For example, GNMA certificates are such
securities in which the timely payment of principal and
interest is guaranteed by the full faith and credit of
the U.S. Government. Although the mortgage loans in the pool
will have maturities of up to 30 years, the actual average
life of the loans typically will be substantially less
because the mortgages will be subject to principal
amortization and may be prepaid prior to maturity.
Prepayment rates vary widely and may be affected by
changes in market interest rates. In periods of
falling interest rates, the rate of prepayment tends to increase,
thereby shortening the actual average life of the
security. Conversely, rising interest rates tend to
decrease the rate of prepayment, thereby lengthening
the actual average life of the security (and increasing
the security's price volatility). Accordingly, it is
not possible to predict accurately the average life of
a particular pool. Reinvestment of prepayment may occur
at higher or lower rates than the original yield on the
certificates. Due to the prepayment feature and the need to
reinvest prepayments of principal at current rates, mortgage-
backed securities can be less effective than typical
bonds of similar maturities at "locking in" yields
during periods of declining interest rates. Such
securities may appreciate or decline in market value
during periods of declining or rising interest rates,
respectively.

Securities issued by U.S. Government
instrumentalities and certain federal agencies are
neither direct obligations of nor guaranteed by the
U.S. Treasury; however, they involve Federal
sponsorship in one way or another. Some are backed by specific
types of collateral, some are supported by the issuer's
right to borrow from the Treasury, some are supported
by the discretionary authority of the Treasury to
purchase certain obligations of the

issuer, others are supported only by the credit of the
issuing government agency or instrumentality. These
agencies and instrumentalities include, but are not
limited to, Federal Land Banks, Farmers Home
Administration, Central Bank for Cooperatives, Federal
Intermediate Credit Banks, Federal Home Loan Banks,
Federal National Mortgage Association, Federal Home
Loan Mortgage Corporation, and Student Loan Marketing
Association.

CONVERTIBLE SECURITIES

Because convertible securities can be converted
into equity securities, their values will normally vary
in some proportion with those of the underlying equity
securities. Convertible securities usually provide a
higher yield than the underlying equity, however, so
that the price decline of a convertible security may
sometimes be less substantial than that of the
underlying equity security.

A Fund may invest in convertible securities, such
as corporate bonds, notes, debentures and other
securities that may be converted into common stock.
Investments in convertible securities can provide
income through interest and dividend payments as well
as an opportunity for capital appreciation by virtue of
their conversion or exchange features.

The convertible securities in which a Fund may
invest include preferred stock that may be converted or
exchanged at a stated or determinable exchange ratio
into underlying shares of common stock. The exchange
ratio for any particular convertible security may be
adjusted from time to time due to stock splits,
dividends, spin-offs, other corporate distributions or scheduled
changes in the exchange ratio. Convertible debt
securities and convertible preferred stocks, until
converted, have general characteristics similar to both
debt and equity securities. Although to a lesser
extent than with debt securities generally, the market
value of convertible securities tends to decline as
interest rates increase and, conversely, tends to increase as
interest rates decline. In addition, because of the
conversion or exchange feature, the market value of
convertible securities typically changes as the market
value of the underlying common stock changes, and,
therefore, also tends to follow movements in the
general market for equity securities. When the market price
of the underlying common stock increases, the price of a
convertible security tends to rise as a reflection of the
value of the underlying common stock, although
typically not as much as the price of the underlying
common stock. While no securities investments are
without risk, investments in convertible securities
generally entail less risk than investments in common
stock of the same issuer.

As debt securities, convertible securities are
investments which provide for a stream of income. Of
course, like all debt securities, there can be no
assurance of income or principal

payments because the issuers of the convertible
securities may default on their obligations.
Convertible securities generally offer lower yields
than non-convertible securities of similar quality
because of their conversion or exchange features.

Convertible securities generally are subordinated
to other similar but non-convertible securities of the
same issuer, although convertible bonds, as corporate
debt obligations, are senior in right of payment to all
equity securities, and convertible preferred stock is
senior to common stock, of the same issuer. However,
convertible bonds and convertible preferred stock
typically have lower coupon rates than similar non-
convertible securities. Convertible securities may be issued
as fixed income obligations that pay current income.

DEBT SECURITIES, IN GENERAL

Investment in debt securities involves both
interest rate and credit risk. Generally, the value of
debt instruments rises and falls inversely with
fluctuations in interest rates. As interest rates
decline, the value of debt securities generally
increases. Conversely, rising interest rates tend to cause the
value of debt securities to decrease. Bonds with longer
maturities generally are more volatile than bonds with
shorter maturities. The market value of debt securities
also varies according to the relative financial
condition of the issuer. In general, lower-quality
bonds offer higher yields due to the increased risk
that the issuer will be unable to meet its obligations
on interest or principal payments at the time called
for by the debt instrument.

ZERO COUPON BONDS

A Fund may purchase zero coupon bonds in
accordance with the Fund's credit quality standards.
Zero coupon bonds are debt obligations issued without
any requirement for the periodic payment of interest,
and are issued at a significant discount from face
value. The discount approximates the total amount of
interest the bonds would accrue and compound over the period
until maturity at a rate of interest reflecting the market
rate at the time of issuance. If a Fund holds zero
coupon bonds in its portfolio, it would recognize
income currently for Federal income tax purposes in the
amount of the unpaid, accrued interest and generally
would be required to distribute dividends repre- senting
such income to shareholders currently, even though the
cash representing such income would not have been received by the
Fund. Cash to pay dividends representing unpaid,
accrued interest may be obtained from, for example,
sales proceeds of portfolio securities and Fund shares
and from loan proceeds. However, this may result in a
Fund's having to sell portfolio securities at a time
when it might otherwise choose not to do so, and the
Fund might incur a capital loss on such sales. Because
interest on zero coupon obligations is not distributed to a Fund
on a current basis, but is in effect compounded, the
value of

such securities is subject to greater fluctuations in
response to changing interest rates than the value of
debt obligations that distribute income regularly.

REPURCHASE AGREEMENTS

Repurchase agreements are contracts under which a
Fund buys a money market instrument and obtains a
simultaneous commitment from the seller to repurchase
the instrument at a specified time and at an agreed-
upon yield. Under guidelines approved by the Trust's
Board of Trustees (the "Board"), a Fund is permitted to
enter into repurchase agreements only if the repurchase
agreements are at least fully collateralized with U.S. Government
securities or other securities that the Fund's
investment adviser has approved for use as collateral
for repurchase agreements and the collateral must be
marked-to-market daily. A Fund will enter into
repurchase agreements only with banks and broker-dealers
deemed to be creditworthy by the Fund's investment adviser under
guidelines approved by the Board. In the unlikely event
of failure of the executing bank or broker-dealer, a
Fund could experience some delay in obtaining direct
ownership of the underlying collateral and might incur
a loss if the value of the security should decline, as
well as costs in disposing of the security.

WARRANTS

The holder of a warrant has the right, until the
warrant expires, to purchase a given number of shares
of a particular issuer at a specified price. Such
investments can provide a greater potential for profit
or loss than an equivalent investment in the underlying
security. However, prices of warrants do not
necessarily move in tandem with the prices of the
underlying securities, and are, therefore, considered speculative
investments. Warrants pay no dividends and confer no
rights other than a purchase option. Thus, if a
warrant held by a Fund were not exercised by the date
of its expiration, the Fund would lose the entire
purchase price of the warrant. A Fund's investments in
warrants will not exceed 5% of the value of its net
assets.

SMALL COMPANIES

Investing in smaller company stocks involves
certain special considerations and risks that are not
usually associated with investing in larger, more
established companies. For example, the securities of
smaller companies may be subject to more abrupt or
erratic market movements, because they tend to be thinly
traded and are subject to a greater degree to changes in the
issuer's earnings and prospects. Small companies also tend
to have limited product lines, markets or financial
resources. Transaction costs in smaller company stocks
also may be higher than those of larger companies.

COMMERCIAL PAPER

Commercial paper represents short-term unsecured
promissory notes issued in bearer form by bank holding
companies, corporations and finance companies. A Fund
may invest in commercial paper that is rated A-1 by S&P
or Prime-1 by Moody's or, if not rated by Moody's or
S&P, is issued by companies having an outstanding debt
issue rated Aaa or Aa by Moody's or AAA or AA by
S&P.

BANKING INDUSTRY AND SAVINGS AND LOAN OBLIGATIONS

Certificates of deposit are negotiable
certificates issued against funds deposited in a
commercial bank for a definite period of time and
earning a specified return. Bankers' acceptances are
negotiable drafts or bills of exchange, normally drawn
by an importer or exporter to pay for specific merchandise,
which are "accepted" by a bank (meaning, in effect, that the
bank unconditionally agrees to pay the face value of
the instrument at maturity). In addition to investing
in certificates of deposit and bankers' acceptances, a
Fund may invest in time deposits in banks or savings
and loan associations. Time deposits are generally
similar to certificates of deposit, but are
uncertificated. A Fund's investments in certificates of deposit,
time deposits, and bankers' acceptances are limited to
obligations of (i) banks having total assets in excess of
$1 billion, (ii) U.S. banks which do not meet the $1
billion asset requirement, if the principal amount of
such obligation is fully insured by the Federal Deposit
Insurance Corporation (the "FDIC"), (iii) savings and
loan associations which have total assets in excess of
$1 billion and which are members of the FDIC, and (iv)
foreign banks if the obligation is, in IMI's opinion, of
an investment quality comparable to other debt securities which
may be purchased by the particular Fund. A Fund's
investments in certificates of deposit of savings
associations are limited to obligations of Federal and
state-chartered institutions whose total assets exceed
$1 billion and whose deposits are insured by the
FDIC.

DEPOSITORY RECEIPTS

ADRs, GDRs and similar instruments, the issuance
of which is typically administered by a U.S. or foreign
bank or trust company, evidence ownership of underlying
securities issued by a U.S. or foreign corporation.
Unsponsored programs are organized independently and
without the cooperation of the issuer of the underlying
sdecurities. As a result, available information
concerning the issuer may not be as current as for sponsored
depository instruments and their prices may be more volatile
than if they were sponsored by the issuers of the
underlying securities. ADRs are publicly traded on
exchanges or over-the- counter ("OTC") in the United
States.

INVESTMENT GRADE DEBT SECURITIES

Bonds rated Aaa by Moody's and AAA by S&P are
judged to be of the best quality (i.e., capacity to pay
interest and repay principal is extremely strong).
Bonds rated Aa/AA are considered to be of high quality
(i.e., capacity to pay interest and repay principal is
very strong and differs from the highest rated issues
only to a small degree). Bonds rated A are viewed as
having many favorable investment attributes, but elements may be
present that suggest a susceptibility to the adverse
effects of changes in circumstances and economic
conditions than debt in higher rated categories. Bonds
rated Baa/BBB (considered by Moody's to be "medium
grade" obligations) are considered to have an adequate
capacity to pay interest and repay principal, but
certain protective elements may be lacking (i.e., such bonds lack
outstanding investment characteristics and have some
speculative characteristics). A Fund may invest in
debt securities that are given an investment-grade
rating by Moody's or S&P, and may also invest in
unrated debt securities that are considered by IMI to
be of comparable quality.

LOW-RATED DEBT SECURITIES

A Fund may invest in corporate debt securities
rated Ba or lower by Moody's, or BB or lower by S&P. A
Fund will not, however, invest in securities that, at
the time of investment, are rated lower than C by
either Moody's or S&P. Securities rated lower than Baa
or BBB (and comparable unrated securities) are commonly
referred to as "high yield" or "junk" bonds and are
considered to be predominantly speculative with respect to the
issuer's continuing ability to meet principal and interest
payments. The lower the ratings of corporate debt
securities, the more their risks render them like
equity securities. (See Appendix A for a more complete
description of the ratings assigned by Moody's and S&P
and their respective
characteristics.)

While IMI may refer to ratings issued by
established credit rating agencies, it is not IMI's
policy to rely exclusively on such ratings, but rather
to supplement such ratings with its own independent and
ongoing review of credit quality. A Fund's achievement
of its investment objective may, to the extent of its
investment in low-rated debt securities, be more dependent upon
IMI's credit analysis than would be the case if the Funds
were investing in higher quality bonds. Should the
rating of a portfolio security be downgraded, IMI will
determine whether it is in the relevant Fund's best
interest to retain or dispose of the security.
However, should any individual bond held by a Fund be
downgraded below a rating of C, IMI currently intends to
dispose of such bond based on then existing market conditions.

The secondary market on which low-rated debt
securities are traded may be less liquid than the
market for higher grade bonds. Less liquidity in the
secondary trading market could adversely affect the
price at which a Fund could sell a low-rated debt
security, and cause large fluctuations in the daily net asset

value of the Fund's shares. Adverse publicity and
investor perceptions, whether or not based on
fundamental analysis, may decrease the value and
liquidity of low-rated , especially in a thinly traded
market. When secondary markets for high yield
securities become relatively less liquid, it may be more
difficult to value the securities, requiring additional research,
and elements of judgment. Prices for high yield bonds
may be affected by legislative and regulatory
developments. (For example, Federal rules require
savings and loan institutions to reduce gradually their
holdings of this type of security).

FOREIGN SECURITIES

A Fund may invest in securities of foreign
issuers, including non-U.S. dollar-denominated debt
securities, Euro dollar securities, sponsored and
unsponsored ADRs, ADSs, GDRs GDSs and debt securities
issued, assumed or guaranteed by foreign governments or
political subdivisions or instrumentalities thereof.
Shareholders should consider carefully the substantial
risks involved in investing in securities issued by companies and
governments of foreign nations, which are in addition to
the usual risks inherent in the domestic investments.

Although a Fund intends to invest only in nations
that IMI considers to have relatively stable and
friendly governments, there is the possibility of
expropriation, nationalization, repatriation or
confiscatory taxation, taxation of income earned in a
foreign country and other foreign taxes, foreign exchange
controls (which may include suspension of the ability to
transfer currency from a given country), default in
foreign government securities, political or social
instability or diplomatic developments which could
affect investments in securities of issuers in those
nations. In addition, in many countries there is less
publicly available information about issuers than is
available for U.S. companies. For example, ownership of
unsponsored ADRs may not entitle the owner to financial or other
reports from the issuer to which it might otherwise be
entitled as the owner of a sponsored ADR. Moreover,
foreign companies are not generally subject to uniform
accounting, auditing and financial reporting standards,
and auditing practices and requirements may not be
comparable to those applicable to U.S. companies. In
many foreign countries, there is less government
supervision and regulation of business and industry practices,
stock exchanges, brokers and listed companies than in the
United States. Foreign securities transactions may
also be subject to higher brokerage costs than domestic
securities transactions. The foreign securities
markets of many of the countries in which a Fund may
invest may also be smaller, less liquid and subject to
greater price volatility than those in the United States. In
addition, a Fund may encounter difficulties or be unable to
pursue legal remedies and obtain judgment in foreign
courts.

Foreign stock markets have different clearance and
settlement procedures and in certain markets there have
been

times when settlements have been unable to keep pace
with the volume of securities transactions, making it
difficult to conduct such transactions. Delays in
settlement could result in temporary periods when
assets of a Fund are uninvested and no return is earned
thereon. The inability of a Fund to make intended
security purchases due to settlement problems could
cause that Fund to miss attractive investment opportunities.
Further, the inability to dispose of portfolio securities
due to settlement problems could result either in
losses to a Fund because of subsequent declines in the
value of the portfolio security or, if a Fund has
entered into a contract to sell the security, in
possible liability to the purchaser. Fixed commissions
on some foreign securities exchanges are generally
higher than negotiated commissions on U.S. exchanges, although
IMI will endeavor to achieve the most favorable net results
on a Fund's portfolio transactions. It may be more
difficult for a Fund's agents to keep currently
informed about corporate actions such as stock
dividends or other matters that may affect the prices
of portfolio securities. Communications between the
United States and foreign countries may be less reliable than
within the United States, thus increasing the risk of
delayed settlements of portfolio transactions or loss
of certificates for portfolio securities. Moreover,
individual foreign economies may differ favorably or
unfavorably from the United States economy in such
respects as growth of gross national product, rate of
inflation, capital reinvestment, resource self-sufficiency and
balance of payments position. IMI seeks to mitigate the
risks to a Fund associated with the foregoing
considerations through investment variation and
continuous professional management.

INVESTING IN EMERGING MARKETS

Investors should recognize that investing in
certain foreign securities involves special
considerations, including those set forth below, that
are not typically associated with investing in United
States securities and that may affect a Fund's performance
favorably or unfavorably. (See "Foreign Securities" under the
caption "Risk Factors and Investment Techniques" in the
Prospectus.)

In recent years, many emerging market countries
around the world have undergone political changes that
have reduced government's role in economic and personal
affairs and have stimulated investment and growth.
Historically, there is a strong direct correlation
between economic growth and stock market returns.
While this is no guarantee of future performance, IMI
believes that investment opportunities (particularly in the
energy, environmental services, natural resources, basic
materials, power, telecommunications and transportation
industries) may result within the evolving economies of
emerging market countries from which the Fund and its
shareholders will benefit.

Investments in companies domiciled in developing
countries may be subject to potentially higher risks
than investments in developed countries. Such risks
include (i) less social, political and economic
stability; (ii) a small market for securities and/or a
low or nonexistent volume of trading, which result in a
lack of liquidity and greater price volatility; (iii)
certain national policies that may restrict a Fund's investment
opportunities, including restrictions on investment in
issuers or industries deemed sensitive to national
interests; (iv) foreign taxation; (v) the absence of
developed structures governing private or foreign
investment or allowing for judicial redress for injury
to private property; (vi) the absence, until relatively
recently in certain Eastern European countries, of a
capital market structure or market-oriented economy; (vii) the
possibility that recent favorable economic developments in
Eastern Europe may be slowed or reversed by unanticipated
political or social events in such countries; and (viii)
the possibility that currency devaluations could
adversely affect the value of a Fund's investments.
Further, many emerging markets have experienced and
continue to experience high rates of inflation.

Despite the dissolution of the Soviet Union, the
Communist Party may continue to exercise a significant
role in certain Eastern European countries. To the
extent of the Communist Party's influence, investments
in such countries will involve risks of
nationalization, expropriation and confiscatory
taxation. The communist governments of a number of Eastern
European countries expropriated large amounts of private
property in the past, in many cases without adequate
compensation, and there can be no assurance that such
expropriation will not occur in the future. In the
event of such expropriation, a Fund could lose a
substantial portion of any investments it has made in the
affected countries. Further, few (if any) accounting standards
exist in Eastern European countries. Finally, even
though certain Eastern European currencies may be
convertible into U.S. dollars, the conversion rates may
be artificial in relation to the actual market values
and may be adverse to a Fund's net asset value.

Certain Eastern European countries that do not
have well- established trading markets are characterized
by an absence of developed legal structures governing
private and foreign investments and private property.
In addition, certain countries require governmental
approval prior to investments by foreign persons, or
limit the amount of investment by foreign persons in a
particular company, or limit the investment of foreign persons
to only a specific class of securities of a company that
may have less advantageous terms than securities of the
company available for purchase by nationals.

Authoritarian governments in certain Eastern
European countries may require that a governmental or
quasi-governmental authority act as custodian of a
Fund's assets invested in such

country. To the extent such governmental or quasi-
governmental authorities do not satisfy the
requirements of the Investment Company Act of 1940, as
amended (the "1940 Act"), with respect to the custody
of a Fund's cash and securities, that Fund's investment
in such countries may be limited or may be required to
be effected through intermediaries. The risk of loss through
governmental confiscation may be increased in such
countries.

CANADIAN SECURITIES

Ivy Canada Fund normally invests a significant
portion of its assets in Canadian securities. The
Canadian securities market is among the largest in the
world. Equity securities are traded primarily on the
country's five independent regional stock exchanges:
The Toronto Stock Exchange ("TSE"), the Montreal
Exchange ("ME"), the Vancouver Stock Exchange ("VSE"), the
Alberta Stock Exchange and the Winnipeg Stock Exchange. The
TSE, which is the largest regional exchange, had a
total market capitalization of $1190.8 billion as of
November, 1996 and its 1,304 listed companies had a
November trading volume of 2,610,118,602 shares. A
small percentage of Canadian stocks are traded on the
unlisted or OTC market. In contrast, almost all debt
securities are traded on the OTC. Interlisting is common
among the Canadian and U.S. stock exchanges and the OTC markets.
In addition, the TSE, the American Stock Exchange and
the Midwest Stock Exchange are electronically linked to
permit the order routing of interlisted securities on
those stock exchanges. The ME and the Boston Stock
Exchange are similarly linked. Ivy Canada Fund invests
less than 1% of its assets in securities listed solely
on the VSE.

The economy of Canada is strongly influenced by
the activities of companies and industries involved in
the production and processing of natural resources.
The companies may include those involved in the energy
industry, industrial materials (chemicals, base metals,
timber and paper) and agricultural materials (grain
cereals). The securities of companies in the energy
industry are subject to changes in value and dividend
yield, which depend, to a large extent, on the price and supply
of energy fuels. Rapid price and supply fluctuations may
be caused by events relating to international politics,
energy conservation and the success of exploration
projects. Economic prospects are changing due to recent
government attempts to reduce restrictions against
foreign investment. These considerations are
especially important for a Fund, like Ivy Canada Fund,
which invests primarily in Canadian securities.

Many factors, including social, environmental and
economic conditions, that are not within the control of
Canada affect and could have an adverse impact on the
financial condition of Canada. IMI is unable to
predict what effect, if any, such factors would have on
instruments held in a Fund's portfolio.

Beginning in January of 1989 the U.S. - Canada
Free Trade Agreement will be phased in over a period of
10 years. This agreement will remove tariffs on U.S.
technology and Canadian agricultural products in
addition to removing trade barriers affecting other
important sectors of each country's economy.
Additionally, the recent implementation of the North American
Free Trade Agreement in January, 1994 is expected to lead to
increased trade and reduced barriers between Canada and
the United States.

Canada is one of the world's leading industrial
countries, as well as a major exporter of agricultural
products. Canada is rich in natural resources such as
zinc, uranium, nickel, gold, silver, aluminum, iron and
copper. Forest covers over 44% of land area, making
Canada a leading world producer of newsprint.

Canada is also a major producer of
hydroelectricity, oil and gas. The business activities
of companies in the energy field may include the
production, generation, transmission, marketing,
control or measurement of energy or energy fuels.

Canadian securities exchanges are self-regulatory
agencies that are recognized by the securities
administrators of the province in which the exchange is
located. The largest, most active Canadian exchange is
the TSE, which is a self-regulated agency recognized by
the Ontario Securities Commission. Canadian securities
regulation differs in certain respects from United
States securities regulation. For example, the amount of
information available concerning companies that have securities
traded on Canadian exchanges and do not have securities
traded on an exchange in the United States is generally
less than that available concerning companies which
have securities traded on United States exchanges. See
"Risk Factors and Investment Techniques" in the
Prospectus for a discussion of the risks associated
with investing in the securities of foreign companies.

INVESTING IN LATIN AMERICA

Investing in securities of Latin American issuers
may entail risks relating to the potential political
and economic instability of certain Latin American
countries and the risks of expropriation,
nationalization, confiscation or the imposition of
restrictions on foreign investment and on repatriation of capital
invested. In the event of expropriation,
nationalization or other confiscation by any country, a
Fund could lose its entire investment in any such
country.

The securities markets of Latin American countries
are substantially smaller, less developed, less liquid
and more volatile than the major securities markets in
the U.S. Disclosure and regulatory standards are in
many respects less stringent than U.S. standards.
Furthermore, there is a lower level of monitoring and
regulation of the markets and the activities of
investors in such markets.

The limited size of many Latin American securities
markets and limited trading volume in the securities of
Latin American issuers compared to volume of trading in
the securities of U.S. issuers could cause prices to be
erratic for reasons apart from factors that affect the
soundness and competitiveness of the securities
issuers. For example, limited market size may cause
prices to be unduly influenced by traders who control large
positions. Adverse publicity and investors' perceptions,
whether or not based on in-depth fundamental analysis,
may decrease the value and liquidity of portfolio
securities.

Latin America Strategy Fund invests in securities
denominated in currencies of Latin American countries.
Accordingly, changes in the value of these currencies
against the U.S. dollar will result in corresponding
changes in the U.S. dollar value of the Fund's assets
denominated in those currencies.

Some Latin American countries also may have
managed currencies, which are not free floating against
the U.S. dollar. In addition, there is risk that
certain Latin American countries may restrict the free
conversion of their currencies into other countries.
Further, certain Latin American currencies may not be
internationally traded. Certain of these currencies have
experienced a steep devaluation relative to the U.S. dollar.
Any devaluations in the currencies in which a Fund's
portfolio securities are denominated may have a
detrimental impact on that Fund's net asset value.

The economies of individual Latin American
countries may differ favorably or unfavorably from the
U.S. economy in such respects as the rate of growth of
gross domestic product, the rate of inflation, capital
reinvestment, resource self- sufficiency and balance of
payments position. Certain Latin American countries
have experienced high levels of inflation which can
have a debilitating effect on the economy.
Furthermore, certain Latin American countries may impose
withholding taxes on dividends payable to a Fund at a higher rate
than those imposed by other foreign countries. This may
reduce the Fund's investment income available for
distribution to shareholders.

Certain Latin American countries such as
Argentina, Brazil and Mexico are among the world's
largest debtors to commercial banks and foreign
governments. At times, certain Latin American
countries have declared moratoria on the payment of principal
and/or interest on outstanding debt. Investment in
sovereign debt can involve a high degree of risk. The
governmental entity that controls the repayment of
sovereign debt may not be able or willing to repay the
principal and/or interest when due in accordance with
the terms of such debt. A governmental entity's
willingness or ability to repay principal and interest due in a
timely manner may be affected by, among other factors, its
cash flow situation, the extent of its foreign
reserves, the

availability of sufficient foreign exchange on the date
a payment is due, the relative size of the debt service
burden to the economy as a whole, the governmental
entity's policy towards the International Monetary
Fund, and the political constraints to which a
governmental entity may be subject. Governmental
entities may also be dependent on expected disbursements from
foreign governments, multilateral agencies and others abroad
to reduce principal and interest arrearages on their
debt. The commitment on the part of these governments,
agencies and others to make such disbursements may be
conditioned on a governmental entity's implementation
of economic reforms and/or economic performance and the
timely service of such debtor's obligations. Failure
to implement such reforms, achieve such levels of
economic performance or repay principal or interest when due may
result in the cancellation of such third parties'
commitments to lend funds to the governmental entity,
which may further impair such debtor's ability or
willingness to service its debts in a timely manner.
Consequently, governmental entities may default on
their sovereign debt.

Holders of sovereign debt, including a Fund, may
be requested to participate in the rescheduling of such
debt and to extend further loans to governmental
entities. There is no bankruptcy proceeding by which
defaulted sovereign debt may be collected in whole or
in part.

Governments of many Latin American countries have
exercised and continue to exercise substantial
influence over many aspects of the private sector
through the ownership or control of many companies,
including some of the largest in those countries. As a
result, government actions in the future could have a
significant effect on economic conditions which may adversely
affect prices of certain portfolio securities.
Expropriation, confiscatory taxation, nationalization,
political, economic or social instability or other
similar developments, such as military coups, have
occurred in the past and could also adversely affect a
Fund's investments in this region.

Changes in political leadership, the
implementation of market oriented economic policies,
such as privatization, trade reform and fiscal and
monetary reform are among the recent steps taken to
renew economic growth. External debt is being
restructured and flight capital (domestic capital that has left
home country) has begun to return. Inflation control
efforts have also been implemented. Latin American
equity markets can be extremely volatile and in the
past have shown little correlation with the U.S.
market. Currencies are typically weak, but most are
now relatively free floating, and it is not unusual for the
currencies to undergo wide fluctuations in value over short
periods of time due to changes in the market.

INVESTING IN ASIA PACIFIC SECURITIES

Certain Asia-Pacific countries in which Ivy Asia
Pacific Fund may invest are developing countries, and
may be in the initial stages of their industrialization
cycle. The economic structures of developing countries
generally are less diverse and mature than in the
United States, and their political systems may be
relatively unstable. Historically, markets of developing
countries have been more volatile than the markets of developed
countries, yet such markets often have provided higher
rates of return to investors.

Investing in securities of issuers in Asia-Pacific
countries involves certain considerations not typically
associated with investing in securities of United
States companies, including (i) restrictions on foreign
investment and on repatriation of capital invested in
Asian countries, (ii) currency fluctuations, (iii) the
cost of converting foreign currency into United States
dollars, (iv) potential price volatility and lesser liquidity of
shares traded on Asia-Pacific country securities markets
and (v) political and economic risks, including the
risk of nationalization or expropriation of assets and
the risk of war.

Certain Asia-Pacific countries may be more
vulnerable to the ebb and flow of international trade
and to trade barriers and other protectionist or
retaliatory measures. Investments in countries that
have recently opened their capital markets and that
appear to have relaxed their central planning requirement,
as well as in countries that have privatized some of their state-
owned industries, should be regarded as speculative.

The settlement period of securities transactions
in foreign markets in general may be longer than in
domestic markets, and such delays may be of particular
concern in developing countries. For example, the
possibility of political upheaval and the dependence on
foreign economic assistance may be greater in
developing countries than in developed countries, either one of
which may increase settlement delays.

Securities exchanges, issuers and broker-dealers
in some Asia-Pacific countries are subject to less
regulatory scrutiny than in the United States. In
addition, due to the limited size of the markets for
Asia-Pacific securities, the prices for such securities
may be more vulnerable to adverse publicity, investors'
perceptions or traders' positions or strategies, which
could cause a decrease not only in the value but also in the
liquidity of the Fund's investments.

INVESTING IN NATURAL RESOURCES

Since the Ivy Global Natural Resources Fund
normally invests a substantial portion of its assets in
securities of companies engaged in natural resources
activities, the Fund may be subject to greater risks
and market fluctuations than funds with more
diversified portfolios. The value of the Fund's securities will
fluctuate in response to market conditions generally, and
will be

particularly sensitive to the markets for those natural
resources in which a particular issuer is involved.
The values of natural resources may also fluctuate
directly with respect to real and perceived
inflationary trends and various political developments.
In selecting the Fund's portfolio of investments, IMI will
consider each company's ability to create new products, secure
any necessary regulatory approvals, and generate
sufficient customer demand. A company's failure to
perform well in any one of these areas, however, could
cause its stock to decline sharply.

Ivy Global Natural Resources Fund's investments in
precious metals (such as gold) and other physical
commodities are subject to special risk considerations,
including substantial price fluctuations over short
periods of time. On the other hand, investments in
precious metals coins or bullion could help to moderate
fluctuations in the value of the Fund's portfolio, since
the prices of precious metals have at times tended not to
fluctuate as widely as shares of issuers engaged in the mining
of precious metals. Because precious metals and other
commodities do not generate investment income, however,
the return on such investments will be derived solely
from the appreciation and depreciation on such
investments. The Fund may also incur storage and other
costs relating to its investments in precious metals
and other commodities, which may, under certain
circumstances, exceed custodial and brokerage costs associated
with investments in other types of securities. When the
Fund purchases a precious metal, IMI currently intends
that it will only be in a form that is readily
marketable.

Natural resource industries throughout the world
may be subject to greater political, environmental and
other governmental regulation than many other
industries. Changes in governmental policies and the
need for regulatory approvals may have an adverse
effect on the products and services of natural
resources companies. For example, the exploration, development
and distribution of coal, oil and gas in the United States
are subject to significant Federal and state
regulation, which may affect rates of return on such
investments and the kinds of services that may be
offered to companies in those industries. In addition,
many natural resource companies have been subject to
significant costs associated with compliance with environmental
and other safety regulations. Such regulations may also
hamper the development of new technologies. The
direction, type or effect of any future regulations
affecting natural resource industries are virtually
impossible to predict.

To take advantage of potential growth
opportunities, Ivy Global Natural Resources Fund might
have significant investments in companies with
relatively small market capitalization. Securities of
smaller companies may be subject to more abrupt or
erratic market movements than the securities of larger more
established companies, because they tend to be traded in lower

volume and because the companies are subject to greater
business risk.

Under normal conditions, Ivy Global Natural
Resources Fund is likely to be invested heavily in
foreign securities. Investing in securities of foreign
issuers and denominated in foreign currencies involves
risks not typically associated with investing in United
States securities, including fluctuations in foreign
exchange rates, exposure to adverse political and
economic developments and the possible imposition of exchange
controls and related restrictions. In addition, competition
is intense for many natural resource companies. As a
result, the value of the securities issues by such
companies may to subject to increased share price
volatility.

INVESTING IN THE CHINA REGION

Investors should realize that China Region
countries may be subject to a greater degree of
economic, political and social instability than is the
case in the United States or other developed countries.
Among the factors causing this instability are (i)
authoritarian governments or military involvement in
political and economic decision making, (ii) popular unrest
associated with demands for improved political, economic and
social conditions, (iii) internal insurgencies, (iv)
hostile relations with neighboring countries, (v)
ethnic, religious and racial disaffection, and (vi)
changes in trading status, any one of which could
disrupt the principal financial markets in which the
Ivy China Region Fund invests and adversely affect the value
of its assets. In addition, several China Region countries
have had hostile relations with neighboring nations.
For example, China continues to claim sovereignty over
Taiwan, and is scheduled to assume sovereignty over
Hong Kong in 1997.

China Region countries tend to be heavily
dependent on international trade, as a result of which
their markets are highly sensitive to protective trade
barriers and the economic conditions of their principal
trading partners (i.e., the United States, Japan and
Western European countries). Protectionist trade
legislation, reduction of foreign investment in China
Region economies and general declines in the international
securities markets could have a significant adverse effect on
the China Region securities markets. In addition,
certain China Region countries have in the past failed
to recognize private property rights and have at times
nationalized or expropriated the assets of private
companies. There is a heightened risk in these
countries that such adverse actions might be repeated.

To take advantage of potential growth
opportunities, the Ivy China Region Fund might have
significant investments in companies with relatively
small market capitalization. Securities of smaller
companies may be subject to more abrupt or erratic
market movements than the securities of larger more
established companies, both because they tend to be traded in

lower volume and because the companies are subject to
greater business risk. In addition, to the extent that
any China Region country experiences rapid increases
in its money supply or investment in equity securities
for speculative purposes, the equity securities traded
in such countries may trade at price- earning multiples
higher than those of comparable companies trading on
securities markets in the United States, which may not
be sustainable. Finally, restriction on foreign investment
exists to varying degrees in some China Region countries.
Where such restrictions apply, investments may be
limited and may increase the Fund's expenses. See also
"Selected Economic and Market Data for Asia Pacific and
China Region Countries" in Appendix C to this SAI.

PRECIOUS METALS AND OTHER PHYSICAL COMMODITIES

Commodities trading is generally considered a
speculative activity. For example, prices of precious
metals are affected by factors such as cyclical
economic conditions, political events and monetary
policies of various countries. Accordingly, markets
for precious metals may at times be volatile and there may be
sharp price fluctuations even during periods when prices
overall are rising. Investments in physical
commodities may also present practical problems of
delivery, storage and maintenance, possible
illiquidity, the unavailability of accurate market valuations and
increased expenses.

Under current U.S. tax law, the Ivy Global Natural
Resources Fund may not receive more than 10% of its
yearly income from gains resulting from selling
precious metals or any other physical commodity.
Accordingly, the Fund may be required to hold its
precious metals or sell them at a loss, or to sell its
portfolio securities at a gain, when for investment reasons it
would not otherwise do so.

FORWARD FOREIGN CURRENCY CONTRACTS

A forward contract is an obligation to purchase or
sell a specific currency for an agreed price at a
future date (usually less than a year), and typically
is individually negotiated and privately traded by
currency traders and their customers. A forward
contract generally has no deposit requirement, and no
commissions are charged at any stage for trades. Although
foreign exchange dealers do not charge a fee for commissions,
they do realize a profit based on the difference between
the price at which they are buying and selling various
currencies. Although these contracts are intended to
minimize the risk of loss due to a decline in the value
of the hedged currencies, at the same time, they tend
to limit any potential gain which might result should
the value of such currencies increase.

While a Fund may enter into forward contracts to
reduce currency exchange risks, changes in currency
exchange rates may result in poorer overall performance
for a Fund than if it had

not engaged in such transactions. Moreover, there may
be an imperfect correlation between a Fund's portfolio
holdings of securities denominated in a particular
currency and forward contracts entered into by that
Fund. An imperfect correlation of this type may
prevent a Fund from achieving the intended hedge or
expose the Fund to the risk of currency exchange loss.

A Fund will not enter into or maintain a net
exposure to a forward contract where the consummation
of the contract would obligate the Fund to deliver an
amount of currency that exceeds the value of the Fund's
portfolio securities or other assets denominated in
that currency. Further, a Fund generally will not
enter into a forward contract with a term greater than one year.

To the extent required by applicable law, a Fund
will hold cash or liquid securities in a segregated
account with its custodian in an amount equal (on a
daily marked-to-market basis) to the amount of the
commitments under these contracts. At the maturity of
a forward contract, a Fund may either accept or make
delivery of the currency specified in the contract, or, prior to
maturity, enter into a closing purchase transaction
involving the purchase or sale of an offsetting
position. Closing purchase transactions with respect
to forward contracts are usually effected with the
currency trader who is a party to the original forward
contract.

FOREIGN CURRENCIES

Investment in foreign securities will usually
involve currencies of foreign countries. In addition,
a Fund may temporarily hold foreign currency deposits
during the completion of investment programs and may
purchase forward contracts. Because of these factors,
the value of the assets of a Fund as measured in U.S.
dollars may be affected favorably or unfavorably by
changes in foreign currency exchange rates and exchange
control regulations, and the Fund may incur costs in connection
with conversions between various currencies. Although a
Fund values the Fund's assets daily in terms of U.S.
dollars, a Fund does not intend to convert its holdings
of foreign currencies into U.S. dollars on a daily
basis. A Fund may do so from time to time, and
investors should be aware of the costs of currency
conversion. Although foreign exchange dealers do not charge a
fee for conversion, they do realize a profit based on the
difference (the "spread") between the prices at which they
are buying and selling various currencies. Thus, a
dealer may offer to sell a foreign currency to a Fund
at one rate, while offering a lesser rate of exchange
should the Fund desire to resell that currency to the
dealer. A Fund will conduct its foreign currency
exchange transactions either on a cash basis at the spot rate
prevailing in the foreign currency exchange market, or
through entering into forward contracts to purchase or
sell foreign currencies.

Because a Fund normally will be invested in both
U.S. and foreign securities markets, changes in the
Fund's share price may have a low correlation with
movements in U.S. markets. A Fund's share price will
reflect movements of the stock and bond markets in
which it is invested (both U.S. and foreign), and of the
currencies in which its foreign investments are denominated.
Thus, the strength or weakness of the U.S. dollar against
foreign currencies accounts for part of a Fund's
investment performance. U.S. and foreign securities
markets do not always move in step with each other, and
the total returns from different markets may vary
significantly.

REAL ESTATE INVESTMENT TRUSTS (REITs)

Ivy Global Fund may invest in equity real estate
investment trusts ("REITs"). A REIT is a corporation,
trust or association that invests in real estate
mortgages or equities for the benefit of its investors.
REITs are dependent upon management skill, may not be
diversified and are subject to the risks of financing
projects. Such entities are also subject to heavy cash flow
dependency, defaults by borrowers, self-liquidation and the
possibility of failing to qualify for tax-free pass-through
of income under the Internal Revenue Code of 1986, as
amended (the "Code") and to maintain exemption from the
1940 Act. By investing in REITs indirectly through a
fund, a shareholder will bear not only his or her
proportionate share of the expenses of the Fund, but
also, indirectly, similar expenses of the REITs.

OPTIONS TRANSACTIONS

OPTIONS, IN GENERAL. A Fund may engage in
transactions in options on securities and stock indices
in accordance with the Fund's stated investment
objective and policies. A Fund may also purchase put
options on securities and may purchase and sell (write)
put and call options on stock indices. Options on
securities and stock indices purchased or written by a Fund will
be limited to options traded on national securities
exchanges, boards of trade or similar entities, or in
the OTC markets.

A call option is a short-term contract (having a
duration of less than one year) pursuant to which the
purchaser, in return for the premium paid, has the
right to buy the security underlying the option at the
specified exercise price at any time during the term of
the option. The writer of the call option, who
receives the premium, has the obligation, upon exercise of
the option, to deliver the underlying security against payment
of the exercise price. A put option is a similar
contract pursuant to which the purchaser, in return for
the premium paid, has the right to sell the security
underlying the option at the specified exercise price
at any time during the term of the option. The writer
of the put option, who receives the premium, has the
obligation, upon exercise of the option, to buy the underlying
security at the exercise price. The premium paid by the

purchaser of an option will reflect, among other
things, the relationship of the exercise price to the
market price and volatility of the underlying security,
the time remaining to expiration of the option, supply
and demand, and interest rates.

If the writer of an option wishes to terminate the
obligation, the writer may effect a "closing purchase
transaction." This is accomplished by buying an option of
the same series as the option previously written. The
effect of the purchase is that the writer's position
will be cancelled by the Options Clearing Corporation.
However, a writer may not effect a closing purchase
transaction after it has been notified of the exercise
of an option. Likewise, an investor who is the holder
of an option may liquidate his or her position by effecting a
"closing sale transaction." This is accomplished by selling
an option of the same series as the option previously
purchased. There is no guarantee that either a closing
purchase or a closing sale transaction can be effected
at any particular time or at any acceptable price. If
any call or put option is not exercised or sold, it
will become worthless on its expiration date.

A Fund will realize a gain (or a loss) on a
closing purchase transaction with respect to a call or
a put previously written by the Fund if the premium,
plus commission costs, paid by the Fund to purchase the
call or the put is less (or greater) than the premium,
less commission costs, received by the Fund on the sale
of the call or the put. A gain also will be realized if a call
or a put that a Fund has written lapses unexercised,
because the Fund would retain the premium. Any such
gains (or losses) are considered short-term capital
gains (or losses) for Federal income tax purposes. Net
short-term capital gains, when distributed by a Fund,
are taxable as ordinary income. See "Taxation."

A Fund will realize a gain (or a loss) on a
closing sale transaction with respect to a call or a
put previously purchased by the Fund if the premium,
less commission costs, received by the Fund on the sale
of the call or the put is greater (or less) than the
premium, plus commission costs, paid by the Fund to
purchase the call or the put. If a put or a call expires
unexercised, it will become worthless on the expiration date,
and a Fund will realize a loss in the amount of the
premium paid, plus commission costs. Any such gain or
loss will be long-term or short-term gain or loss,
depending upon a Fund's holding period for the option.

Exchange-traded options generally have
standardized terms and are issued by a regulated
clearing organization (such as the Options Clearing
Corporation), which, in effect, guarantees the
completion of every exchange-traded option transaction. In
contrast, the terms of OTC options are negotiated by a Fund
and its counterparty (usually a securities dealer or a
financial institution) with no clearing organization
guarantee. When a Fund purchases an OTC option, it
relies on the party from whom it

has purchased the option (the "counterparty") to make
delivery of the instrument underlying the option. If
the counterparty fails to do so, a Fund will lose any
premium paid for the option, as well as any expected
benefit of the transaction. Accordingly, IMI will
assess the creditworthiness of each counterparty to
determine the likelihood that the terms of the OTC option will be
satisfied.

WRITING OPTIONS ON INDIVIDUAL SECURITIES. A Fund
may write (sell) covered call options on the Fund's
securities in an attempt to realize a greater current
return than would be realized on the securities alone.
A Fund may also write covered call options to hedge a
possible stock or bond market decline (only to the
extent of the premium paid to the Fund for the
options). In view of the investment objectives of a Fund, the
Fund generally would write call options only in
circumstances where the investment adviser to the Fund
does not anticipate significant appreciation of the
underlying security in the near future or has otherwise
determined to dispose of the security.

A Fund may write covered call options as described
in the Fund's Prospectus. A "covered" call option
means generally that so long as the Fund is obligated
as the writer of a call option, the Fund will (i) own
the underlying securities subject to the option, or
(ii) have the right to acquire the underlying
securities through immediate conversion or exchange of
convertible preferred stocks or convertible debt securities owned
by the Fund. Although a Fund receives premium income
from these activities, any appreciation realized on an
underlying security will be limited by the terms of the
call option. A Fund may purchase call options on
individual securities only to effect a "closing
purchase transaction."

As the writer of a call option, a Fund receives a
premium for undertaking the obligation to sell the
underlying security at a fixed price during the option
period, if the option is exercised. So long as a Fund
remains obligated as a writer of a call option, it
forgoes the opportunity to profit from increases in the
market price of the underlying security above the exercise
price of the option, except insofar as the premium represents
such a profit (and retains the risk of loss should the
value of the underlying security decline).

PURCHASING OPTIONS ON INDIVIDUAL SECURITIES. A
Fund may purchase a put option on an underlying
security owned by the Fund as a defensive technique in
order to protect against an anticipated decline in the
value of the security. A Fund, as the holder of the
put option, may sell the underlying security at the
exercise price regardless of any decline in its market price. In
order for a put option to be profitable, the market
price of the underlying security must decline
sufficiently below the exercise price to cover the
premium and transaction costs that a Fund must pay.
These costs will reduce any profit a Fund might have
realized had it sold the underlying security instead of buying

the put option. The premium paid for the put option
would reduce any capital gain otherwise available for
distribution when the security is eventually sold. The
purchase of put options will not be used by a Fund for
leverage purposes.

A Fund may also purchase a put option on an
underlying security that it owns and at the same time
write a call option on the same security with the same
exercise price and expiration date. Depending on
whether the underlying security appreciates or
depreciates in value, a Fund would sell the underlying
security for the exercise price either upon exercise of the call
option written by it or by exercising the put option held
by it. A Fund would enter into such transactions in
order to profit from the difference between the premium
received by the Fund for the writing of the call option
and the premium paid by the Fund for the purchase of
the put option, thereby increasing the Fund's current
return. A Fund may write (sell) put options on
individual securities only to effect a "closing sale
transaction."

PURCHASING AND WRITING OPTIONS ON SECURITIES
INDICES. A Fund may purchase and sell (write) put and
call options on securities indices. An index assigns
relative values to the securities included in the index
and the index fluctuates with changes in the market
values of the securities so included. Options on
indices are similar to options on individual
securities, except that, rather than giving the purchaser the
right to take delivery of an individual security at a
specified price, they give the purchaser the right to
receive cash. The amount of cash is equal to the
difference between the closing price of the index and
the exercise price of the option, expressed in dollars,
times a specified multiple (the "multiplier"). The
writer of the option is obligated, in return for the
premium received, to make delivery of this amount.

The multiplier for an index option performs a
function similar to the unit of trading for a stock
option. It determines the total dollar value per
contract of each point in the difference between the
exercise price of an option and the current level of
the underlying index. A multiplier of 100 means that a
one-point difference will yield $100. Options on
different indices have different multipliers.

When a Fund writes a call or put option on a stock
index, the option is "covered", in the case of a call,
or "secured", in the case of a put, if the Fund
maintains in a segregated account with the Custodian
cash or liquid securities equal to the contract value.
A call option is also covered if a Fund holds a call on
the same index as the call written where the exercise
price of the call held is (i) equal to or less than the exercise
price of the call written or (ii) greater than the
exercise price of the call written, provided that the
Fund maintains in a segregated account with the
Custodian the difference in cash or liquid securities.
A put option is also "secured" if a Fund

holds a put on the same index as the put written where
the exercise price of the put held is (i) equal to or
greater than the exercise price of the put written or
(ii) less than the exercise price of the put written,
provided that the Fund maintains in a segregated
account with the Custodian the difference in cash or
liquid securities.

RISKS OF OPTIONS TRANSACTIONS. The purchase and
writing of options involves certain risks. During the
option period, the covered call writer has, in return
for the premium on the option, given up the opportunity
to profit from a price increase in the underlying
securities above the exercise price, but, as long as
its obligation as a writer continues, has retained the risk of
loss should the price of the underlying security decline.
The writer of an option has no control over the time
when it may be required to fulfill its obligation as a
writer of the option. Once an option writer has
received an exercise notice, it cannot effect a closing
purchase transaction in order to terminate its
obligation under the option and must deliver the underlying
securities (or cash in the case of an index option) at the
exercise price. If a put or call option purchased by a Fund
is not sold when it has remaining value, and if the
market price of the underlying security (or index), in
the case of a put, remains equal to or greater than the
exercise price or, in the case of a call, remains less
than or equal to the exercise price, a Fund will lose
its entire investment in the option. Also, where a put
or call option on a particular security (or index) is purchased
to hedge against price movements in a related security (or
securities), the price of the put or call option may
move more or less than the price of the related
security (or securities). In this regard, there are
differences between the securities and options markets
that could result in an imperfect correlation between
these markets, causing a given transaction not to achieve
its objective.

There can be no assurance that a liquid market
will exist when a Fund seeks to close out an option
position. Furthermore, if trading restrictions or
suspensions are imposed on the options markets, a Fund
may be unable to close out a position. Finally,
trading could be interrupted, for example, because of supply and
demand imbalances arising from a lack of either buyers or
sellers, or the options exchange could suspend trading
after the price has risen or fallen more than the
maximum amount specified by the exchange. Closing
transactions can be made for OTC options only by
negotiating directly with the counterparty or by a
transaction in the secondary market, if any such market exists.
There is no assurance that a Fund will be able to close
out an OTC option position at a favorable price prior
to its expiration. In the event of insolvency of the
counterparty, a Fund might be unable to close out an
OTC option position at any time prior to its
expiration. Although a Fund may be able to offset to some
extent any adverse effects of being unable to liquidate an
option position, the Fund may experience losses in some
cases as a result of such inability.

A Fund's options activities also may have an
impact upon the level of its portfolio turnover and
brokerage commissions. See "Portfolio Turnover."

A Fund's success in using options techniques
depends, among other things, on IMI's ability to
predict accurately the direction and volatility of
price movements in the options and securities markets,
and to select the proper type, time and duration of
options.

FUTURES CONTRACTS

FUTURES, IN GENERAL. A Fund may enter into
futures contracts for hedging purposes. A futures
contract provides for the future sale by one party and
purchase by another party of a specified quantity of a
commodity at a specified price and time. When a
purchase or sale of a futures contract is made by a Fund,
the Fund is required to deposit with its custodian (or broker,
if legally permitted) a specified amount of cash or
U.S. Government securities ("initial margin"). The
margin required for a futures contract is set by the
exchange on which the contract is traded and may be
modified during the term of the contract. The initial
margin is in the nature of a performance bond or good faith
deposit on the futures contract which is returned to the Fund
upon termination of the contract, assuming all
contractual obligations have been satisfied. A futures
contract held by the Fund is valued daily at the
official settlement price of the exchange on which it
is traded. Each day the Fund pays or receives cash,
called "variation margin," equal to the daily change in
value of the futures contract. This process is known
as "marking to market." Variation margin does not represent a
borrowing or loan by a Fund but is instead a settlement
between the Fund and the broker of the amount one would
owe the other if the futures contract expired. In
computing daily net asset value, the Fund will mark-to-
market its open futures position.

Although some futures contracts call for making or
taking delivery of the underlying securities, generally
these obligations are closed out prior to delivery of
offsetting purchases or sales of matching futures
contracts (same exchange, underlying security or index,
and delivery month). If an offsetting purchase price
is less than the original sale price, a Fund generally
realizes a capital gain, or if it is more, the Fund
generally realizes a capital loss. Conversely, if an
offsetting sale price is more than the original purchase price,
the Fund generally realizes a capital gain, or if it is
less, the Fund generally realizes a capital loss. The
transaction costs must also be included in these
calculations. When purchasing a futures contract, a
Fund will maintain with its Custodian (and mark-to-
market on a daily basis) cash or liquid securities that,
when added to the amounts deposited with a futures commission
merchant ("FCM") as margin, are equal to the market value of
the futures contract.

When selling a futures contact, a Fund will
maintain with its custodian in a segregated account
(and mark-to-market on a daily basis) cash or liquid
securities that, when added to the amounts deposited
with an FCM as margin, are equal to the market value of
the instruments underlying the contract. Alternatively,
a Fund may "cover" its position by owning the instruments
underlying the contract.

A Fund will only enter into futures contracts
which are standardized and traded on a U.S. or foreign
exchange, board of trade, or similar entity or quoted
on an automated quotation system. A Fund will not
enter into a futures contract if, immediately
thereafter, the aggregate initial margin deposits for
futures contracts held by the Fund plus premiums paid by it for
open futures option positions, less the amount by which
any such positions are "in-the-money," would exceed 5%
of the liquidation value of the Fund's portfolio (or
the Fund's net asset value), after taking into account
unrealized profits and unrealized losses on any such
contracts the Fund has entered into.

The requirements for qualification as a regulated
investment company also may limit the extent to which a
Fund may enter into futures.

FOREIGN CURRENCY FUTURES CONTRACTS. A Fund may
engage in foreign currency futures contracts for
hedging purposes. A foreign currency futures contract
provides for the future sale by one party and purchase
by another party of a specified quantity of a foreign
currency at a specified price and time.

RISKS ASSOCIATED WITH FUTURES. There are several
risks associated with the use of futures contracts as
hedging techniques. A purchase or sale of a futures
contract may result in losses in excess of the amount
invested in the futures contract. There can be no
guarantee that there will be a correlation between
price movements in the hedging vehicle and in a Fund's
portfolio securities being hedged. In addition, there
are significant differences between the securities and futures
markets that could result in an imperfect correlation
between the markets, causing a given hedge not to
achieve its objectives. The degree of imperfection of
correlation depends on circumstances such as variations
in speculative market demand for futures on securities,
including technical influences in futures trading, and
differences between the financial instruments being
hedged and the instruments underlying the standard contracts
available for trading in such respects as interest rate
levels, maturities, and creditworthiness of issuers. A
decision as to whether, when and how to hedge involves
the exercise of skill and judgment, and even a well-
conceived hedge may be unsuccessful to some degree
because of market behavior or unexpected interest rate
trends.

Futures exchanges may limit the amount of
fluctuation permitted in certain futures contract
prices during a single

trading day. The daily limit establishes the maximum
amount that the price of a futures contract may vary
either up or down from the previous day's settlement
price at the end of the current trading session. Once
the daily limit has been reached in a futures contract
subject to the limit, no more trades may be made on
that day at a price beyond that limit. The daily limit
governs only price movements during a particular trading day and
therefore does not limit potential losses because the
limit may work to prevent the liquidation of
unfavorable positions. For example, futures prices
have occasionally moved to the daily limit for several
consecutive trading days with little or no trading,
thereby preventing prompt liquidation of positions and
subjecting some holders of futures contracts to substantial
losses.

There can be no assurance that a liquid market
will exist at a time when a Fund seeks to close out a
futures position, and the Fund would remain obligated
to meet margin requirements until the position is
closed. In addition, there can be no assurance that an
active secondary market will continue to exist.

Currency futures contracts may be traded on
foreign exchanges. Such transactions may not be
regulated as effectively as similar transactions in the
United States; may not involve a clearing mechanism and
related guarantees; and are subject to the risk of
governmental actions affecting trading in, or the prices
of, foreign securities. The value of such position also could be
adversely affected by (i) other complex foreign
political, legal and economic factors, (ii) lesser
availability than in the United States of data on which
to make trading decisions, (iii) delays in a Fund's
ability to act upon economic events occurring in
foreign markets during non business hours in the United States,
(iv) the imposition of different exercise and settlement
terms and procedures and margin requirements than in
the United States, and (v) lesser trading volume.

SECURITIES INDEX FUTURES CONTRACTS

A Fund may enter into securities index futures
contracts as an efficient means of regulating the
Fund's exposure to the equity markets. A Fund will not
engage in transactions in futures contracts for
speculation but only as a hedge against changes
resulting from market conditions in the values of
securities held in the Fund's portfolio or which it intends to
purchase.

An index futures contract is a contract to buy or
sell units of an index at a specified future date at a
price agreed upon when the contract is made. Entering
into a contract to buy units of an index is commonly
referred to as purchasing a contract or holding a long
position in the index. Entering into a contract to
sell units of an index is commonly referred to as selling a
contract or holding a short position. The value of a unit is
the current value of the stock index. For example, the
S&P 500 Index

is composed of 500 selected common stocks, most of
which are listed on the New York Stock Exchange (the
"Exchange"). The S&P 500 Index assigns relative
weightings to the 500 common stocks included in the
Index, and the Index fluctuates with changes in the
market values of the shares of those common stocks. In the
case of the S&P 500 Index, contracts are to buy or sell 500
units. Thus, if the value of the S&P 500 Index were $150,
one contract would be worth $75,000 (500 units x $150).
The index futures contract specifies that no delivery
of the actual securities making up the index will take
place. Instead, settlement in cash must occur upon the
termination of the contract, with the settlement being
the difference between the contract price and the
actual level of the stock index at the expiration of
the contract. For example, if a Fund enters into a
futures contract to buy 500 units of the S&P 500 Index at a
specified future date at a contract price of $150 and the S&P
500 Index is at $154 on that future date, a Fund will
gain $2,000 (500 units x gain of $4). If a Fund enters
into a futures contract to sell 500 units of the stock
index at a specified future date at a contract price of
$150 and the S&P 500 Index is at $154 on that future
date, the Fund will lose $2,000 (500 units x loss of
$4).

RISKS OF SECURITIES INDEX FUTURES. A Fund's
success in using hedging techniques depends, among
other things, on IMI's ability to predict correctly the
direction and volatility of price movements in the
futures and options markets as well as in the
securities markets and to select the proper type, time and
duration of hedges. The skills necessary for successful use of
hedges are different from those used in the selection of
individual stocks.

A Fund's ability to hedge effectively all or a
portion of its securities through transactions in index
futures (and therefore the extent of its gain or loss
on such transactions) depends on the degree to which
price movements in the underlying index correlate with
price movements in the Fund's securities. Insofar as
such securities do not duplicate the components of an
index, the correlation probably will not be perfect.
Consequently, a Fund will bear the risk that the prices of the
securities being hedged will not move in the same amount as
the hedging instrument. This risk will increase as the
composition of a Fund's portfolio diverges from the
composition of the hedging instrument.

Although a Fund intends to establish positions in
these instruments only when there appears to be an
active market, there is no assurance that a liquid
market will exist at a time when the Fund seeks to
close a particular option or futures position. Trading
could be interrupted, for example, because of supply and
demand imbalances arising from a lack of either buyers or
sellers. In addition, the futures exchanges may suspend trading
after the price has risen or fallen more than the
maximum amount specified by the exchange. In some
cases, a Fund may experience

losses as a result of its inability to close out a
position, and it may have to liquidate other
investments to meet its cash needs.

Although some index futures contracts call for
making or taking delivery of the underlying securities,
generally these obligations are closed out prior to
delivery by offsetting purchases or sales of matching
futures contracts (same exchange, underlying security
or index, and delivery month). If an offsetting
purchase price is less than the original sale price, a
Fund generally realizes a capital gain, or if it is more, the
Fund generally realizes a capital loss. Conversely, if an
offsetting sale price is more than the original purchase
price, a Fund generally realizes a capital gain, or if
it is less, the Fund generally realizes a capital loss.
The transaction costs must also be included in these
calculations.

A Fund will only enter into index futures
contracts or futures options that are standardized and
traded on a U.S. or foreign exchange or board of trade,
or similar entity, or quoted on an automated quotation
system. A Fund will use futures contracts and related
options only for "bona fide hedging" purposes, as such
term is defined in applicable regulations of the CFTC.

When purchasing an index futures contract, a Fund
will maintain with its custodian in a segregated
account (and mark-to- market on a daily basis) cash or
liquid securities that, when added to the amounts
deposited with a futures commission merchant ("FCM") as
margin, are equal to the market value of the futures
contract. Alternatively, a Fund may "cover" its position by
purchasing a put option on the same futures contract with a
strike price as high as or higher than the price of the
contract held by a Fund.

When selling an index futures contract, a Fund
will maintain with its custodian in a segregated
account (and mark-to-market on a daily basis) cash or
liquid securities that, when added to the amounts
deposited with an FCM as margin, are equal to the market
value of the instruments underlying the contract. Alternatively,
a Fund may "cover" its position by owning the
instruments underlying the contract (or, in the case of
an index futures contract, a portfolio with a
volatility substantially similar to that of the index
on which the futures contract is based), or by holding
a call option permitting a Fund to purchase the same
futures contract at a price no higher than the price of the
contract written by the Fund (or at a higher price if the
difference is maintained in liquid assets with the Fund's
custodian).

COMBINED TRANSACTIONS. A Fund may enter into
multiple transactions, including multiple options
transactions, multiple futures transactions, multiple
currency transactions (including forward currency
contracts) and multiple interest rate

transactions and some combination of futures, options,
currency and interest rate transactions ("component"
transactions), instead of a single transaction, as part
of a single or combined strategy when, in the opinion
of IMI, it is in the best interests of a Fund to do so.
A combined transaction will usually contain elements of
risk that are present in each of its component
transactions. Although combined transactions are normally
entered into based on IMI's judgment that the combined
strategies will reduce risk or otherwise more
effectively achieve the desired portfolio management
goal, it is possible that the combination will instead
increase such risks or hinder achievement of the
management objective.

FIRM COMMITMENT AGREEMENTS AND WHEN-ISSUED SECURITIES

New issues of certain debt securities are often
offered on a "when-issued basis," meaning the payment
obligation and the interest rate are fixed at the time
the buyer enters into the commitment, but delivery and
payment for the securities normally take place after
the date of the commitment to purchase. Firm
commitment agreements call for the purchase of securities at an
agreed-upon price on a specified future date. A Fund uses
such investment techniques in order to secure what is
considered to be an advantageous price and yield to the
Fund and not for purposes of leveraging the Fund's
assets. In either instance, a Fund will maintain in a
segregated account with its custodian cash or liquid
securities equal (on a daily marked-to-market basis) to
the amount of its commitment to purchase the underlying
securities.

RESTRICTED AND ILLIQUID SECURITIES

An "illiquid security" is an asset that may not be
sold or disposed of in the ordinary course of business
within seven days at approximately the value at which a
Fund has valued the security on its books. A
"restricted security" is a security that cannot be
offered to the public for sale without first being
registered under the Securities Act of 1933, and is considered to
be illiquid until such filing takes place. Restricted
securities may be sold only in privately negotiated
transactions or in a public offering with respect to
which a registration statement is in effect under the
Securities Act of 1933. Where a registration statement
is required, a Fund may be required to bear all or part
of the registration expenses. Issuers of restricted securities
may not be subject to the disclosure and other investor
protection requirements that would be applicable if their
securities were publicly traded. There may also be a lapse
of time between a Fund's decision to sell a restricted
or illiquid security and the point at which the Fund is
permitted or able to do so. If, during such a period,
adverse market conditions were to develop, a Fund might
obtain a less favorable price than the price that
prevailed when it decided to sell. Since it is not
possible to predict with assurance that the market for securities
eligible for resale under Rule 144A will continue to be
liquid, a

Fund will monitor each of its investments in these
securities, focusing on factors such as valuation,
liquidity and availability of information. This
investment practice could have the effect of increasing
the level of illiquidity in a Fund to the extent that
qualified institutional buyers become, for a time,
uninterested in purchasing these restricted securities.
Securities whose proceeds are subject to limitations on
repatriation of principal or profits for more than seven days,
and those for which market quotations are not readily
available, may be deemed illiquid for these
purposes.

BORROWING

Borrowing may exaggerate the effect on a Fund's
net asset value of any increase or decrease in the
value of the Fund's portfolio securities. Money
borrowed will be subject to interest costs (which may
include commitment fees and/or the cost of maintaining
minimum average balances). Although the principal of a
Fund's borrowings will be fixed, the Fund's assets may change
in value during the time a borrowing is outstanding, thus
increasing exposure to capital risk. All borrowings will
be repaid before any additional investments are
made.

LOANS OF PORTFOLIO SECURITIES

A Fund may lend its investment securities to
brokers, dealers and financial institutions for the
purpose of realizing additional income. Loans of
securities by a Fund will be collateralized by cash,
letters of credit, or securities issued or guaranteed
by the U.S Government or its agencies or
instrumentalities. The collateral will equal (on a daily marked-
to-market basis) at least 100% of the current market
value of the loaned securities. The risks in lending
portfolio securities, as with other extensions of
credit, involve a possible loss of rights in the
collateral should the borrower fail financially. In
determining whether to lend securities, IMI will consider all
relevant facts and circumstances, including the
creditworthiness of the borrower.

INVESTMENT RESTRICTIONS

A Fund's investment objective, as set forth in the
Prospectus under "Investment Objectives and Policies,"
and the investment restrictions set forth below are
fundamental policies of the Fund and may not be changed
with respect to that Fund without the approval of a
majority (as defined in the 1940 Act) of the
outstanding voting shares of that Fund. Under these
restrictions, each of Ivy Asia Pacific Fund, Ivy China Region
Fund, Ivy Global Natural Resources Fund, Ivy Global Science
& Technology Fund, Ivy International Fund, Ivy
International Small Companies Fund, Ivy Latin America
Strategy Fund and Ivy New Century Fund may not:

(i) make an investment in securities of companies
in any one industry (except obligations of
domestic banks or the U.S. Government, its
agencies, authorities, or instrumentalities)
if such investment would cause investments in
such industry to exceed 25% of the market
value of the Fund's total assets at the time of
such investment; or

(ii) issue senior securities, except as
appropriate to evidence indebtedness which it
is permitted to incur, and except to the
extent that shares of the separate classes or
series of the Trust may be deemed to be
senior securities; provided that collateral
arrangements with respect to currency-related
contracts, futures contracts, options or other
permitted investments, including deposits of initial
and variation margin, are not considered to be the
issuance of senior securities for purposes of this
restriction.

Further, as a matter of fundamental policy, each of Ivy
Asia Pacific Fund, Ivy Canada Fund, Ivy China Region
Fund, Ivy Global Fund, Ivy Global Natural Resources
Fund, Ivy Global Science & Technology Fund, Ivy
International Small Companies Fund and Ivy New Century
Fund may not:

(i) purchase securities of any one issuer (except
U.S. Government securities) if as a result
more than 5% of the Fund's total assets would
be invested in such issuer or the Fund would
own or hold more than 10% of the outstanding
voting securities of that issuer; provided,
however, that up to 25% of the value of the
Fund's total assets may be invested without regard to
these limitations.

Further, as a matter of fundamental policy, each
of Ivy Asia Pacific Fund, Ivy China Region Fund, Ivy
International Fund, Ivy Latin America Strategy Fund and
Ivy New Century Fund may not:

(i) participate in an underwriting or selling
group in connection with the public
distribution of securities except for its own
capital stock.

Further, as a matter of fundamental policy, each
of Ivy China Region Fund, Ivy Global Science &
Technology Fund, Ivy International Fund, Ivy Latin
America Strategy Fund and Ivy New Century Fund may not:

(i) purchase securities on margin; or

(ii) purchase from or sell to any of its officers
or trustees, or firms of which any of them
are members or which they control, any
securities (other than capital stock of the
Fund), but such persons or firms may act

as brokers for the Fund for customary
commissions to the extent permitted by the
Investment Company Act of 1940.

Further, as a matter of fundamental policy, Ivy Asia
Pacific Fund, Ivy Canada Fund, Ivy Global Fund, Ivy
Global Natural Resources Fund and Ivy International
Small Companies Fund may not:

(i) Purchase securities on margin, except such
short-term credits as are necessary for the
clearance of transactions, but Ivy Asia
Pacific Fund, Ivy Global Fund, Ivy Global
Natural Resources Fund and Ivy International
Small Companies Fund may make margin deposits
in connection with transactions in options,
futures and options on futures; or

(ii) Make loans, except this restriction shall not
prohibit (a) the purchase and holding of a
portion of an issue of publicly distributed
debt securities, (b) the entry into
repurchase agreements with banks or broker-
dealers, or, with respect to Ivy Asia Pacific Fund, Ivy
Global Fund, Ivy Global Natural Resources Fund and Ivy
International Small Companies Fund, (c) the
lending of the Fund's portfolio securities in
accordance with applicable guidelines
established by the Securities and Exchange
Commission (the "SEC") and any guidelines
established by the Trust's Trustees.

Further, as a matter of fundamental policy, Ivy Canada
Fund, Ivy Global Fund, Ivy Global Natural Resources
Fund and Ivy International Small Companies Fund may
not:

(i) Make investments in securities for the
purpose of exercising control over or
management of the issuer; or

(ii) Act as an underwriter of securities, except
to the extent that, in connection with the
sale of securities, it may be deemed to be an
underwriter under applicable securities laws.

Further, as a matter of fundamental policy, each of Ivy
Asia Pacific Fund, Ivy Global Natural Resources Fund,
Ivy Global Science & Technology Fund and Ivy
International Small Companies Fund may not:

(i) borrow money, except as a temporary measure
for extraordinary or emergency purposes, and
provided that the Fund maintains asset
coverage of 300% for all borrowings.

Further, as a matter of fundamental policy, Ivy Asia
Pacific Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund and Ivy International Small Companies
Fund may not:

(i) Invest in real estate, real estate mortgage
loans, commodities or interests in oil, gas
and/or mineral exploration or development
programs, although (a) the Fund may purchase
and sell marketable securities of issuers
which are secured by real estate, (b) the Fund
may purchase and sell securities of issuers which
invest or deal in real estate, (c) the Fund may enter
into forward foreign currency contracts as described in
the Fund's prospectus, and (d) the Fund may
write or buy puts, calls, straddles or
spreads and may invest in commodity futures
contracts and options on futures contracts.

Further, as a matter of fundamental policy, each of Ivy
China Region Fund, Ivy International Fund, Ivy Latin
America Strategy Fund and Ivy New Century Fund may not:

(i) purchase or sell real estate or commodities
and commodity contracts; or

(ii) sell securities short.

Under the 1940 Act, a Fund is permitted, subject
to each Fund's investment restrictions, to borrow money
only from banks. The Trust has no current intention of
borrowing amounts in excess of 5% of each the Fund's
assets. Each of Ivy China Region Fund, Ivy
International Fund, Ivy Latin America Strategy Fund and Ivy
New Century Fund will continue to interpret fundamental
investment restriction (i) above to prohibit investment in real
estate limited partnership interests; this restriction
shall not, however, prohibit investment in readily
marketable securities of companies that invest in real
estate or interests therein, including real estate
investment trusts.

Further, as a matter of fundamental policy, each of Ivy
Asia Pacific Fund, Ivy China Region Fund, Ivy Global
Natural Resources Fund, Ivy Global Science & Technology
Fund, Ivy International Small Companies Fund, Ivy Latin
America Strategy Fund and Ivy New Century Fund may not:

(i) lend any funds or other assets, except that
this restriction shall not prohibit (a) the
entry into repurchase agreements, (b) the
purchase of publicly distributed bonds,
debentures and other securities of a similar
type, or privately placed municipal or
corporate bonds, debentures and other securities of a
type customarily purchased by institutional investors
or publicly traded in the securities markets, or
(c) the lending of portfolio securities
(provided that the loan is secured
continuously by collateral consisting of U.S.
Government securities or cash or cash
equivalents maintained on a daily marked-to-market
basis in an amount at least equal to the market value
of the securities loaned).

Further, as a matter of fundamental policy, each of Ivy
Latin America Strategy Fund and Ivy New Century Fund
may not:

(i) borrow money, except for temporary or
emergency purposes; provided that the Fund
maintains asset coverage of 300% for all
borrowings.

Further, as a matter of fundamental policy, each of Ivy
China Region Fund and Ivy International Fund may not:

(i) borrow money, except for temporary purposes
where investment transactions might
advantageously require it. Any such loan may
not be for a period in excess of 60 days, and
the aggregate amount of all outstanding loans
may not at any time exceed 10% of the value of
the total assets of the Fund at the time any such loan
is made.

Further, as a matter of fundamental policy, Ivy Canada
Fund and Ivy Global Fund may not:

(i) Participate on a joint or a joint and several
basis in any trading account in securities.
The "bunching" of orders of the Fund and of
other accounts under the investment
management of the Manager (in the case of Ivy
Global Fund) or the investment adviser, Mackenzie
Financial Corporation (the "Investment Adviser") (in
the case of Ivy Canada Fund) for the sale or purchase
of portfolio securities shall not be considered
participation in a joint securities trading
account;

(ii) Borrow amounts in excess of 10% of its total
assets, taken at the lower of cost or market
value, and then only from banks as a
temporary measure for extraordinary or
emergency purposes. All borrowings will be
repaid before any additional investments are
made;

(iii)Purchase the securities of issuers conducting
their principal business activities in the
same industry if immediately after such
purchase the value of the Fund's investments
in such industry would exceed 25% of the
value of the total assets of the Fund;

(iv) Purchase any security if, as a result, the
Fund would then have more than 5% of its
total assets (taken at current value)
invested in securities restricted as to
disposition under the Federal securities laws; or

(v) Issue senior securities, except insofar as
the Fund may be deemed to have issued a
senior security in connection with any
repurchase agreement or any permitted
borrowing.

Further, as a matter of fundamental policy, Ivy Canada
Fund may not:

(i) Write or buy puts, calls, straddles or
spreads; invest in real estate, real estate
mortgage loans, commodities, commodity
futures contracts or interests in oil, gas
and/or mineral exploration or development
programs, although (a) the Fund may purchase and sell
marketable securities of issuers which are secured by
real estate, (b) the Fund may purchase and sell
securities of issuers which invest or deal in real
estate, and (c) the Fund may enter into
forward foreign currency contracts as
described in the Fund's prospectus.

Further, as a matter of fundamental policy, Ivy Global
Fund may not:

(i) purchase securities of another investment
company, except in connection with a merger,
consolidation, reorganization or acquisition
of assets, and except that the Fund may
invest in securities of other investment
companies subject to the restrictions in
Section 12(d)(1) of the Investment Company Act of 1940
(the "1940 Act").

Further, as a matter of fundamental policy, Ivy Global
Science & Technology Fund may not:

(i) participate in an underwriting or selling
group in connection with the public
distribution of securities, except for its
own capital stock, and except to the extent
that, in connection with the disposition of
portfolio securities, it may be deemed to be an
underwriter under the Federal securities laws;

(ii) purchase or sell real estate or commodities
and commodity contracts; provided, however,
that the Fund may purchase securities secured
by real estate or interests therein, or
securities issued by companies that invest in
real estate or interests therein, and except
that, subject to the policies and restrictions
set forth in the Prospectus and elsewhere in this SAI,
(i) the Fund may enter into futures contracts, and
options thereon, and (ii) the Fund may enter into
forward foreign currency contracts and currency
futures contracts, and options thereon; or

(iii)sell securities short, except for short sales
"against the box."

Further, as a matter of fundamental policy, Ivy
International Fund may not:

(i) lend any funds or other assets, except that
this restriction shall not prohibit (a) the
entry into repurchase agreements or (b) the
purchase of publicly distributed bonds,
debentures and other securities of a similar
type, or privately placed municipal or
corporate bonds, debentures and other securities of a
type customarily purchased by institutional investors
or publicly traded in the securities markets;

(ii) invest more than 5% of the value of its total
assets in the securities of any one issuer
(except obligations of domestic banks or the
U.S. Government, its agencies, authorities
and instrumentalities); or

(iii)purchase the securities of any other open-end
investment company, except as part of a plan
of merger or consolidation.

ADDITIONAL RESTRICTIONS

Unless otherwise indicated, each Fund has adopted
the following additional restrictions, which are not
fundamental and which may be changed without
shareholder approval, to the extent permitted by
applicable law, regulation or regulatory policy. Under
these restrictions, each of Asia Pacific Fund, Ivy China
Region Fund, Ivy Global Natural Resources Fund, Ivy Global
Science & Technology Fund, Ivy International Small Companies
Fund, Ivy Latin America Strategy Fund and Ivy New Century
Fund may not:

(i) invest more than 15% of its net assets taken
at market value at the time of investment in
"illiquid securities", provided, however,
that the Fund will not invest more than 10%
of its total assets in securities of issuers
that are restricted from selling to the
public without registration under the Securities act of
1933. Illiquid securities may include securities
subject to legal or contractual restrictions on
resale (including private placements),
repurchase agreements maturing in more than
seven days, certain options traded over the
counter that the Fund has purchased,
securities being used to cover certain options that a
fund has written, securities for which market
quotations are not readily available, or other
securities which legally or in IMI's opinion, subject
to the Board's supervision, may be deemed illiquid,
but shall not include any instrument that,
due to the existence of a trading market, to
the Fund's compliance with certain conditions
intended to provide liquidity, or to other
factors, is liquid.

Further, as a matter of non-fundamental policy, each of
Ivy Asia Pacific Fund, Ivy China Region Fund, Ivy
Global Science &

Technology Fund, Ivy International Fund, Ivy Latin
America Strategy Fund and Ivy New Century Fund may not:

(i) invest in oil, gas or other mineral leases or
exploration or development programs.

Further, as a matter of non-fundamental policy, each of
Ivy Asia Pacific Fund, Ivy China Region Fund, Ivy
Global Resources Fund, Ivy International Small
Companies Fund, Ivy Latin America Strategy Fund and Ivy
New Century Fund may not:

(i) purchase securities of other investment
companies, except in connection with a
merger, consolidation or sale of assets, and
except that it may purchase shares of other
investment companies subject to such
restrictions as may be imposed by the Investment
Company Act of 1940 and rules thereunder.

Further, as a matter of non-fundamental policy, each of
Ivy China Region Fund, Ivy Global Science & Technology
Fund, Ivy International Fund, Ivy Latin America
Strategy Fund and Ivy New Century Fund may not:

(i) invest in companies for the purpose of
exercising control of management; or

(ii) invest more than 5% of its total assets in
warrants, valued at the lower of cost or
market, or more than 2% of its total assets
in warrants, so valued, which are not listed
on either the New York or American Stock
Exchanges.

Further, as a matter of non-fundamental policy, each of
Ivy Canada Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund and Ivy International Small Companies
Fund may not:

(i) purchase or sell interests in oil, gas or
mineral leases (other than securities of
companies that invest in or sponsor such
programs).

Further, as a matter of non-fundamental policy, each of
Ivy Canada Fund, Ivy Global Fund and Ivy International
Small Companies Fund may not:

(i) purchase or sell real estate limited
partnership interests.

Further, as a matter of non-fundamental policy, each of
Ivy Asia Pacific Fund, Ivy Global Natural Resources
Fund and Ivy International Small Companies Fund may
not:

(i) sell securities short, except for short sales
"against the box;" or

(ii) participate on a joint or a joint and several
basis in any trading account in securities.
The "bunching" of orders of the Fund and of
other accounts under the investment
management of the Fund's investment adviser,
for the sale or purchase of portfolio securities shall
not be considered participation in a joint securities
trading account.

Further, as a matter of non-fundamental policy, Ivy
Latin America Strategy Fund may not:

(i) purchase or retain securities of an issuer
if, with respect to 75% of the Fund's total
assets, such purchase would result in more
than 10% of the outstanding voting securities
of such issuer being held by the Fund.

Whenever an investment objective, policy or
restriction set forth in the Prospectus or this SAI
states a maximum percentage of assets that may be
invested in any security or other asset or describes a
policy regarding quality standards, such percentage
limitation or standard shall, unless otherwise indicated, apply
to the particular Fund only at the time a transaction is
entered into. Accordingly, if a percentage limitation
is adhered to at the time of investment, a later
increase or decrease in the percentage which results
from circumstances not involving any affirmative action
by a Fund, such as a change in market conditions or a
change in the Fund's asset level or other circumstances
beyond the Fund's control, will not be considered a
violation.

ADDITIONAL RIGHTS AND PRIVILEGES

The Trust offers and (except as noted below) bears
the cost of providing to investors the following rights
and privileges. The Trust reserves the right to amend
or terminate any one or more of these rights and
privileges. Notice of amendments to or terminations of
rights and privileges will be provided to shareholders
in accordance with applicable law.

Certain of the rights and privileges described
below refer to funds, other than the Funds, whose
shares are also distributed by Ivy Mackenzie
Distributors, Inc. ("IMDI") (formerly known as
Mackenzie Ivy Funds Distribution, Inc.). These funds are: Ivy
Growth Fund, Ivy Growth with Income Fund, Ivy Emerging
Growth Fund, Ivy International Bond Fund, Ivy Bond Fund
and Ivy Money Market Fund (the other six series of the
Trust); and Mackenzie California Municipal Fund,
Mackenzie Limited Term Municipal Fund, Mackenzie
National Municipal Fund and Mackenzie New York
Municipal Fund (the four series of Mackenzie Series Trust)
(collectively, with the Funds, the "Ivy Mackenzie Funds").
Shareholders should obtain a current prospectus before
exercising any right or privilege that may relate to
these funds.

AUTOMATIC INVESTMENT METHOD

The Automatic Investment Method, which enables a
Fund shareholder to have specified amounts
automatically drawn each month from his or her bank for
investment in Fund shares, is available for Class A,
Class B and Class C shares. The minimum initial and
subsequent investment under this method is $50 per
month (except in the case of a tax qualified retirement plan for
which the minimum initial and subsequent investment is
$25 per month). A shareholder may terminate the
Automatic Investment Method at any time upon delivery
to Ivy Mackenzie Services Corp. ("IMSC") (formerly
Mackenzie Ivy Investor Services Corp.) of telephone
instructions or written notice. See "Automatic
Investment Method" in the Prospectus. To begin the plan,
complete Sections 6A and 7B of the Account Application.

EXCHANGE OF SHARES

As described in the Prospectus, shareholders of
each Fund have an exchange privilege with certain other
Ivy Mackenzie Funds. Before effecting an exchange,
shareholders of each Fund should obtain and read the
currently effective prospectus for the Ivy or Mackenzie
Fund into which the exchange is to be made.

INITIAL SALES CHARGE SHARES. Class A shareholders
may exchange their Class A shares ("outstanding Class A
shares") for Class A shares of another Ivy or Mackenzie
Fund ("new Class A Shares") on the basis of the
relative net asset value per Class A share, plus an
amount equal to the difference, if any, between the
sales charge previously paid on the outstanding Class A
shares and the sales charge payable at the time of the exchange
on the new Class A shares. (The additional sales charge
will be waived for Class A shares that have been
invested for a period of 12 months or longer.) Class A
shareholders may also exchange their shares for shares
of Ivy Money Market Fund (no initial sales charge will
be assessed at the time of such an exchange).

CONTINGENT DEFERRED SALES CHARGE SHARES. CLASS A:
Class A shareholders may exchange their Class A shares
that are subject to a contingent deferred sales charge
("CDSC"), as described in the Prospectus ("outstanding
Class A shares"), for Class A shares of another Ivy or
Mackenzie Fund ("new Class A shares") on the basis of
the relative net asset value per Class A share, without
the payment of any CDSC that would otherwise be due upon the
redemption of the outstanding Class A shares. Class A
shareholders of a Fund exercising the exchange privilege will
continue to be subject to that Fund's CDSC period
following an exchange if such period is longer than the
CDSC period, if any, applicable to the new Class A
shares.

For purposes of computing the CDSC that may be
payable upon the redemption of the new Class A shares,
the holding period of the outstanding Class A shares is
"tacked" onto the holding period of the new Class A
shares.

CLASS B: Class B shareholders may exchange their
Class B shares ("outstanding Class B shares") for Class
B shares of another Ivy or Mackenzie Fund ("new Class B
shares") on the basis of the relative net asset value
per Class B share, without the payment of any CDSC that
would otherwise be due upon the redemption of the
outstanding Class B shares. Class B shareholders of a
Fund exercising the exchange privilege will continue to
be subject to that Fund's CDSC schedule (or period)
following an exchange if such schedule is higher (or such period
is longer) than the CDSC schedule (or period) applicable
to the new Class B shares.

Class B shares of a Fund acquired through an
exchange of Class B shares of another Ivy or Mackenzie
Fund will be subject to that Fund's CDSC schedule (or
period) if such schedule is higher (or such period is
longer) than the CDSC schedule (or period) applicable
to the Ivy or Mackenzie Fund from which the exchange
was made.

For purposes of both the conversion feature and
computing the CDSC that may be payable upon the
redemption of the new Class B shares (prior to
conversion), the holding period of the outstanding
Class B shares is "tacked" onto the holding period of
the new Class B shares.

The following CDSC table ("Table 1") applies to
Class B shares of Ivy Asia Pacific Fund, Ivy Bond Fund,
Ivy Canada Fund, Ivy China Region Fund, Ivy Emerging
Growth Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund, Ivy Global Science & Technology Fund,
Ivy Growth Fund, Ivy Growth with Income Fund, Ivy
International Fund, Ivy International Bond Fund, Ivy
International Small Companies Fund, Ivy Latin America Strategy
Fund, Ivy New Century Fund, Mackenzie California Municipal
Fund, Mackenzie National Municipal Fund and Mackenzie
New York Municipal Fund ("Table 1 Funds"):

CONTINGENT DEFERRED
SALES CHARGE AS A
PERCENTAGE OF DOLLAR
AMOUNT SUBJECT TO YEAR SINCE PURCHASE
CHARGE

First 5%
Second 4%
Third 3%
Fourth 3%
Fifth 2%
Sixth 1%
Seventh and thereafter 0%

The following CDSC table ("Table 2") applies to
Class B shares of Mackenzie Limited Term Municipal Fund
("Table 2 Funds"):

CONTINGENT DEFERRED
SALES CHARGE AS A
PERCENTAGE OF DOLLAR
AMOUNT SUBJECT TO YEAR SINCE PURCHASE
CHARGE

First 3%
Second 2.5%
Third 2%
Fourth 1.5%
Fifth 1%
Sixth and thereafter 0%

The CDSC schedule for Table 1 Funds is higher (and
the period is longer) than the CDSC schedule (and
period) for Table 2 Funds.

If a shareholder exchanges Class B shares of a
Table 1 Fund for Class B shares of a Table 2 Fund,
Table 1 will continue to apply to the Class B shares
following the exchange. For example, an investor may
decide to exchange Class B shares of a Table 1 Fund
("outstanding Class B shares") for Class B shares of a Table
2 Fund ("new Class B shares") after having held the
outstanding Class B shares for two years. The 4% CDSC
that generally would apply to a redemption of
outstanding Class B shares held for two years would not
be deducted at the time of the exchange. If, three
years later, the investor redeems the new Class B shares, a
2% CDSC will be assessed upon the redemption because by
"tacking" the two year holding period of the
outstanding Class B shares onto the three year holding
period of the new Class B shares, the investor will be
deemed to have held the new Class B shares for five
years.

If a shareholder exchanges Class B shares of a
Table 2 Fund for Class B shares of a Table 1 Fund,
Table 1 will apply to the Class B shares following the
exchange. For example, an investor may decide to
exchange Class B shares of a Table 2 Fund ("outstanding
Class B shares") for Class B shares of a Table 1 Fund
("new Class B shares") after having held the outstanding
Class B shares for two years. The 2.5% CDSC that generally would
apply to a redemption of outstanding Class B shares held
for two years would not be deducted at the time of the
exchange. If, three years later, the investor redeems
the new Class B shares, a 2% CDSC will be assessed upon
the redemption because by "tacking" the two year
holding period of the outstanding Class B shares onto
the three year holding period of the new Class B shares, the
investor will be deemed to have held the new Class B shares
for five years.

CLASS C: Class C shareholders may exchange their
Class C shares ("outstanding Class C shares") for Class
C shares of another Ivy or Mackenzie Fund ("new Class C
shares") on the basis of the relative net asset value
per Class C share, without the payment of any CDSC that
would otherwise be due upon redemption.

(Class C shares are subject to a CDSC of 1% if redeemed
within one year of the date of purchase.)

CLASS I: Class I shareholders may exchange their
Class I shares for Class I shares of another Ivy Fund
on the basis of the relative net asset value per Class
I share.

ALL CLASSES: The minimum amount which may be
exchanged into Ivy Mackenzie Fund in which shares are
not already held is $1,000 ($5,000,000 in the case of
Class I of Ivy Bond Fund, Ivy Global Science &
Technology Fund, Ivy International Fund and Ivy
International Small Companies Fund (generally referred to herein
as the Class I Funds)). No exchange out of a Fund (other
than by a complete exchange of all Fund shares) may be
made if it would reduce the shareholder's interest in
that Fund to less than $1,000 ($5,000,000 in the case
of Class I shares of the Class I Funds.

Each exchange will be made on the basis of the
relative net asset values per share of each fund of the
Ivy Mackenzie Funds next computed following receipt by
IMSC of telephone instructions by IMSC or a properly
executed request. Exchanges, whether written or
telephonic, must be received by IMSC by the close of
regular trading on the Exchange (normally 4:00 p.m., Eastern
time) to receive the price computed on the day of receipt.
Exchange requests received after that time will receive
the price next determined following receipt of the
request. The exchange privilege may be modified or
terminated at any time, upon at least 60 days' notice
to the extent required by applicable law. See
"Redemptions."

An exchange of shares between any of the Ivy
Mackenzie Funds will result in a taxable gain or loss.
Generally, this will be a capital gain or loss (long-
term or short-term, depending on the holding period of
the shares) in the amount of the difference between the
net asset value of the shares surrendered and the
shareholder's tax basis for those shares. However, in certain
circumstances, shareholders will be ineligible to take
sales charges into account in computing taxable gain or
loss on an exchange. See "Taxation."

With limited exceptions, gain realized by a tax-
deferred retirement plan will not be taxable to the
plan and will not be taxed to the participant until
distribution. Each investor should consult his or her
tax adviser regarding the tax consequences of an
exchange transaction.

LETTER OF INTENT

Reduced sales charges apply to initial investments
in Class A shares of each Fund made pursuant to a non-
binding Letter of Intent. A Letter of Intent may be
submitted by an individual, his or her spouse and
children under the age of 21, or a trustee or other
fiduciary of a single trust estate or single fiduciary

account. See the Account Application in the
Prospectus. Any investor may submit a Letter of Intent
stating that he or she will invest, over a period of 13
months, at least $50,000 in Class A shares of a Fund.
A Letter of Intent may be submitted at the time of an
initial purchase of Class A shares of a Fund or within
90 days of the initial purchase, in which case the Letter
of Intent will be back dated. A shareholder may include, as an
accumulation credit, the value (at the applicable
offering price) of all Class A shares of Ivy Asia
Pacific Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund, Ivy Global Science & Technology Fund,
Ivy Growth Fund, Ivy Growth with Income Fund, Ivy
Emerging Growth Fund, Ivy International Bond Fund, Ivy
International Small Companies Fund, Ivy Bond Fund, Mackenzie
National Municipal Fund, Mackenzie Limited Term Municipal
Fund, Mackenzie California Municipal Fund and Mackenzie
New York Municipal Fund (and shares that have been
exchanged into Ivy Money Market Fund from any of the
other funds in the Ivy Mackenzie Funds) held of record
by him or her as of the date of his or her Letter of
Intent. During the term of the Letter of Intent, the
Transfer Agent will hold Class A shares representing 5%
of the indicated amount (less any accumulation credit value)
in escrow. The escrowed Class A shares will be released when
the full indicated amount has been purchased. If the
full indicated amount is not purchased during the term
of the Letter of Intent, the investor is required to
pay IMDI an amount equal to the difference between the
dollar amount of sales charge that he or she has paid
and that which he or she would have paid on his or her
aggregate purchases if the total of such purchases had been
made at a single time. Such payment will be made by an
automatic liquidation of Class A shares in the escrow
account. A Letter of Intent does not obligate the
investor to buy or the Trust to sell the indicated
amount of Class A shares, and the investor should read
carefully all the provisions of such letter before signing.

RETIREMENT PLANS

Shares may be purchased in connection with several
types of tax-deferred retirement plans. Shares of more
than one fund distributed by IMDI may be purchased in a
single application establishing a single plan account,
and shares held in such an account may be exchanged
among the funds in the Ivy Mackenzie Funds in
accordance with the terms of the applicable plan and the
exchange privilege available to all shareholders. Initial and
subsequent purchase payments in connection with tax-
deferred retirement plans must be at least $25 per
participant.

The following fees will be charged to individual
shareholder accounts as described in the retirement
prototype plan document:

Retirement Plan New Account Fee no fee
Retirement Plan Annual Maintenance Fee $10.00 per
account

For shareholders whose retirement accounts are
diversified across several funds of the Ivy Mackenzie
Funds, the annual maintenance fee will be limited to
not more than $20.

The following discussion describes the tax
treatment of certain tax-deferred retirement plans
under current Federal income tax law. State income tax
consequences may vary. An individual considering the
establishment of a retirement plan should consult with
an attorney and/or an accountant with respect to the
terms and tax aspects of the plan.

INDIVIDUAL RETIREMENT ACCOUNTS: Shares of the
Trust may be used as a funding medium for an Individual
Retirement Account ("IRA"). Eligible individuals may
establish an IRA by adopting a model custodial account
available from IMSC, who may impose a charge for
establishing the account. Individuals should consult
their tax advisers before investing IRA assets in a Fund (which
primarily distributes exempt-interest dividends).

An individual who has not reached age 70-1/2 and
who receives compensation or earned income is eligible
to contribute to an IRA, whether or not he or she is an
active participant in a retirement plan. An individual
who receives a distribution from another IRA, a
qualified retirement plan, a qualified annuity plan or
a tax-sheltered annuity or custodial account ("403(b)
plan") that qualifies for "rollover" treatment is also eligible
to establish an IRA by rolling over the distribution
either directly or within 60 days after its receipt.
Tax advice should be obtained in connection with
planning a rollover contribution to an IRA.

In general, an eligible individual may contribute
up to the lesser of $2,000 or 100% of his or her
compensation or earned income to an IRA each year. If
a husband and wife are both employed, and both are
under age 70-1/2, each may set up his or her own IRA
within these limits. If both earn at least $2,000 per
year, the maximum potential contribution is $4,000 per year
for both. For years after 1996, the result is similar even if
one spouse has no earned income; if the joint earned
income of the spouses is at least $4,000, a
contribution of up to $2,000 may be made to each
spouse's IRA. For years before 1997, however, if one
spouse has (or elects to be treated as having) no
earned income for IRA purposes for a year, the working spouse may
contribute up to the lesser of $2,250 or 100% of his or
her compensation or earned income for the year to IRAs
for both spouses, provided that no more than $2,000 is
contributed to the IRA of one spouse. Rollover
contributions are not subject to these limits.

An individual may deduct his or her annual
contributions to an IRA in computing his or her Federal
income tax within the limits described above, provided
he or she (or his or her spouse, if they file a joint
Federal income tax return) is not an active participant
in a qualified retirement plan (such as a qualified

corporate, sole proprietorship, or partnership pension,
profit sharing, 401(k) or stock bonus plan), qualified
annuity plan, 403(b) plan, simplified employee pension,
or governmental plan. If he or she (or his or her
spouse) is an active participant, a full deduction is
only available if he or she has adjusted gross income
that is less than a specified level ($40,000 for married
couples filing a joint return, $25,000 for single individuals,
and $0 for a married individual filing a separate return).
The deduction is phased out ratably for active
participants with adjusted gross income between certain
levels ($40,000 and $50,000 for married individuals
filing a joint return, $25,000 and $35,000 for single
individuals, and $0 and $10,000 for married individuals
filing separate returns). Individuals who are active
participants with income above the specified phase-out level may
not deduct their IRA contributions. Rollover
contributions are not includible in income for Federal
income tax purposes and therefore are not deductible
from it.

Generally, earnings on an IRA are not subject to
current Federal income tax until distributed.
Distributions attributable to tax-deductible
contributions and to IRA earnings are taxed as ordinary
income. Distributions of non-deductible contributions
are not subject to Federal income tax. In general, distributions
from an IRA to an individual before he or she reaches
age 59-1/2 are subject to a nondeductible penalty tax
equal to 10% of the taxable amount of the distribution.
The 10% penalty tax does not apply to amounts withdrawn
from an IRA after the individual reaches age 59-1/2,
becomes disabled or dies, or if withdrawn in the form
of substantially equal payments over the life or life
expectancy of the individual and his or her designated benefi-
ciary, if any, or rolled over into another IRA, or, for
years after 1996, amounts withdrawn and used to pay for
deductible medical expenses and amounts withdrawn by
certain unemployed individuals not in excess of amounts
paid for certain health insurance premiums.
Distributions must begin to be withdrawn not later than
April 1 of the calendar year following the calendar
year in which the individual reaches age 70-1/2. Failure to take
certain minimum required distributions will result in
the imposition of a 50% non-deductible penalty tax.
Extremely large distributions in any one year (other
than 1997, 1998 or 1999) from an IRA (or from an IRA
and other retirement plans) may also result in a
penalty tax.

QUALIFIED PLANS: For those self-employed
individuals who wish to purchase shares of one or more
of the funds in the Ivy Mackenzie Funds through a
qualified retirement plan, a Custodial Agreement and a
Retirement Plan are available from IMSC. The
Retirement Plan may be adopted as a profit sharing plan or a
money purchase pension plan. A profit sharing plan permits
an annual contribution to be made in an amount
determined each year by the self-employed individual
within certain limits prescribed by law. A money
purchase pension plan requires annual contributions at
the level specified in the Custodial Agreement.

There is no set-up fee for qualified plans and the
annual maintenance fee is $20.00 per account.

In general, if a self-employed individual has any
common law employees, employees who have met certain
minimum age and service requirements must be covered by
the Retirement Plan. A self- employed individual
generally must contribute the same percentage of income
for common law employees as for himself or herself.

A self-employed individual may contribute up to
the lesser of $30,000 or 25% of compensation or earned
income to a money purchase pension plan or to a
combination profit sharing and money purchase pension
plan arrangement each year on behalf of each
participant. To be deductible, total contributions to a
profit sharing plan generally may not exceed 15% of the total
compensation or earned income of all participants in the
plan, and total contributions to a combination money
purchase-profit sharing arrangement generally may not
exceed 25% of the total compensation or earned income
of all participants. The amount of compensation or
earned income of any one participant that may be
included in computing the deduction is limited (generally to
$150,000 for benefits accruing in plan years beginning after
1993, with annual inflation adjustments). A self-
employed individual's contributions to a retirement
plan on his or her own behalf must be deducted in
computing his or her earned income.

Corporate employers may also adopt the Custodial
Agreement and Retirement Plan for the benefit of their
eligible employees. Similar contribution and deduction
rules apply to corporate employers.

Distributions from the Retirement Plan generally
are made after a participant's separation from service.
A 10% penalty tax generally applies to distributions to
an individual before he or she reaches age 59-1/2,
unless the individual (1) has reached age 55 and
separated from service; (2) dies; (3) becomes disabled;
(4) uses the withdrawal to pay tax-deductible medical expenses;
(5) takes the withdrawal as part of a series of
substantially equal payments over his or her life
expectancy or the joint life expectancy of himself or
herself and a designated beneficiary; or (6) rolls over
the distribution.

The Transfer Agent will arrange for Investors Bank
& Trust to furnish custodial services to the employer
and any participating employees.

DEFERRED COMPENSATION FOR PUBLIC SCHOOLS AND
CHARITABLE ORGANIZATIONS ("403(B)(7) ACCOUNT"):
Section 403(b)(7) of the Internal Revenue Code of 1986,
as amended (the "Code"), permits public school systems
and certain charitable organizations to use mutual fund
shares held in a custodial account to fund deferred
compensation arrangements with their employees. A custodial
account agreement is available for those employers whose
employees wish to purchase shares of the Trust in conjunction

with such an arrangement. The sales charge for
purchases of less than $10,000 of Class A shares is set
forth under "Retirement Plans" in the Prospectus.
Sales charges for purchases of $10,000 or more of Class
A shares are the same as those set forth under "Initial
Sales Charge Alternative -- Class A Shares" in the
Prospectus. The special application for a 403(b)(7) Account is
available from IMSC.

Distributions from the 403(b)(7) Account may be
made only following death, disability, separation from
service, attainment of age 59-1/2, or incurring a
financial hardship. A 10% penalty tax generally
applies to distributions to an individual before he or
she reaches age 59-1/2, unless the individual (1) has reached
age 55 and separated from service; (2) dies or becomes
disabled; (3) uses the withdrawal to pay tax-deductible
medical expenses; (4) takes the withdrawal as part of a
series of substantially equal payments over his or her
life expectancy or the joint life expectancy of himself
or herself and a designated beneficiary; or (5) rolls
over the distribution. There is no set-up fee for
403(b)(7) Accounts and the annual maintenance fee is $20.00 per
account.

SIMPLIFIED EMPLOYEE PENSION ("SEP") IRAS: An
employer may deduct contributions to a SEP up to the
lesser of $30,000 or 15% of compensation. SEP accounts
generally are subject to all rules applicable to IRA
accounts, except the deduction limits, and are subject
to certain employee participation requirements. No new
salary reduction SEPs ("SARSEPs") may be established after 1996,
but existing SARSEPs may continue to be maintained, and non-
salary reduction SEPs may continue to be established as
well as maintained after 1996.

SIMPLE PLANS: An employer may establish a SIMPLE
IRA or a SIMPLE 401(k) for years after 1996. An
employee can make pre-tax salary reduction
contributions to a SIMPLE Plan, up to $6,000 a year.
Subject to certain limits, the employer will either match
a portion of employee contributions, or will make a contribution
equal to 2% of each employee's compensation without
regard to the amount the employee contributes. An
employer cannot maintain a SIMPLE Plan for its
employees if any contributions or benefits are credited
to those employees under any other qualified retirement
plan maintained by the employer.

REINVESTMENT PRIVILEGE

Shareholders who have redeemed Class A shares of a
Fund may reinvest all or a part of the proceeds of the
redemption back into Class A shares of the Fund at net
asset value (without a sales charge) within 60 days
from the date of redemption. This privilege may be
exercised only once. The reinvestment will be made at
the net asset value next determined after receipt by IMSC
of the reinvestment order accompanied by the funds to be
reinvested. No compensation will be paid to any sales personnel
or dealer in connection with the transaction.

Any redemption is a taxable event. A loss
realized on a redemption generally may be disallowed
for tax purposes if the reinvestment privilege is
exercised within 30 days after the redemption. In
certain circumstances, shareholders will be ineligible
to take sales charges into account in computing taxable
gain or loss on a redemption if the reinvestment
privilege is exercised. See "Taxation."

RIGHTS OF ACCUMULATION

A scale of reduced sales charges applies to any
investment of $50,000 or more in Class A shares of a
Fund. See "Initial Sales Charge Alternative -- Class A
Shares" in the Prospectus. The reduced sales charge is
applicable to investments made at one time by an
individual, his or her spouse and children under the
age of 21, or a trustee or other fiduciary of a single trust
estate or single fiduciary account (including a pension,
profit sharing or other employee benefit trust created
pursuant to a plan qualified under Section 401 of the
Code). It is also applicable to current purchases of
all of the funds in the Ivy Mackenzie Funds (except Ivy
Money Market Fund) by any of the persons enumerated
above, where the aggregate quantity of Class A shares
of Ivy Asia Pacific Fund, Ivy Bond Fund, Ivy Canada Fund,
Ivy China Region Fund, Ivy Emerging Growth Fund, Ivy Global
Fund, Ivy Global Natural Resources Fund, Ivy Global
Science & Technology Fund, Ivy Growth Fund, Ivy Growth
with Income Fund, Ivy International Fund, Ivy
International Bond Fund, Ivy International Small
Companies Fund, Ivy Latin America Strategy Fund, Ivy
New Century Fund, Mackenzie National Municipal Fund,
Mackenzie California Municipal Fund Mackenzie New York Municipal
Fund and Mackenzie Limited Term Municipal Fund (and
shares that have been exchanged into Ivy Money Market
Fund from any of the other funds in the Ivy Mackenzie
Funds) and of any other investment company distributed
by IMDI, previously purchased or acquired and currently
owned, determined at the higher of current offering
price or amount invested, plus the Class A shares being
purchased, amounts to $50,000 or more for Ivy Asia Pacific Fund,
Ivy Canada Fund, Ivy China Region Fund, Ivy Emerging
Growth Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund, Ivy Global Science & Technology Fund,
Ivy Growth Fund, Ivy Growth with Income Fund, Ivy
International Fund, Ivy International Small Companies
Fund, Ivy Latin America Strategy Fund, Ivy New Century
Fund; $100,000 or more for Ivy Bond Fund, Ivy International Bond
Fund, Mackenzie National Municipal Fund, Mackenzie
California Municipal Fund and Mackenzie New York
Municipal Fund; or $25,000 or more for Mackenzie
Limited Term Municipal Fund.

At the time an investment takes place, IMSC must
be notified by the investor or his or her dealer that
the investment qualifies for the reduced sales charge
on the basis of previous investments. The reduced
sales charge is subject to confirmation of the
investor's holdings through a check of the particular
Fund's records.

SYSTEMATIC WITHDRAWAL PLAN

A shareholder (except shareholders with accounts
in Class I of the Class I Funds) may establish a
Systematic Withdrawal Plan (a "Withdrawal Plan"), by
telephone instructions or by delivery to IMSC of a
written election to have his or her shares withdrawn
periodically, accompanied by a surrender to IMSC of all share
certificates then outstanding in such shareholder's name,
properly endorsed by the shareholder. To be eligible to
elect a Withdrawal Plan, a shareholder must have at
least $5,000 in his or her account. A Withdrawal Plan
may not be established if the investor is currently
participating in the Automatic Investment Method. A
Withdrawal Plan may involve the depletion of a
shareholder's principal, depending on the amount withdrawn.

A redemption under a Withdrawal Plan is a taxable
event. Shareholders contemplating participating in a
Withdrawal Plan should consult their tax advisers.

Additional investments made by investors
participating in a Withdrawal Plan must equal at least
$1,000 each while the Withdrawal Plan is in effect.
Making additional purchases while a Withdrawal Plan is
in effect may be disadvantageous to the investor
because of applicable initial sales charges or CDSCs.

An investor may terminate his or her participation
in the Withdrawal Plan at any time by delivering
written notice to IMSC. If all shares held by the
investor are liquidated at any time, participation in
the Withdrawal Plan will terminate automatically. The
Trust or IMSC may terminate the Withdrawal Plan option
at any time after reasonable notice to shareholders.

GROUP SYSTEMATIC INVESTMENT PROGRAM

Shares may be purchased in connection with
investment programs established by employee or other
groups using systematic payroll deductions or other
systematic payment arrangements. The Trust does not
itself organize, offer or administer any such programs.
However, it may, depending upon the size of the
program, waive the minimum initial and additional investment
requirements for purchases by individuals in conjunction with
programs organized and offered by others. Unless shares
of a Fund are purchased in conjunction with IRAs (see
"How to Buy Shares" in the Prospectus), such group
systematic investment programs are not entitled to
special tax benefits under the Code. The Trust
reserves the right to refuse purchases at any time or
suspend the offering of shares in connection with group
systematic investment programs, and to restrict the offering of
shareholder privileges, such as check writing, simplified
redemptions and other optional privileges, as described
in the Prospectus, to shareholders using group
systematic investment programs.

With respect to each shareholder account
established on or after September 15, 1972 under a
group systematic investment program, the Trust and IMI
each currently charge a maintenance fee of $3.00 (or
portion thereof) that for each twelve-month period (or
portion thereof) that the account is maintained. The
Trust may collect such fee (and any fees due to IMI) through a
deduction from distributions to the shareholders involved
or by causing on the date the fee is assessed a
redemption in each such shareholder account sufficient
to pay such fee. The Trust reserves the right to
change these fees from time to time without advance
notice.

BROKERAGE ALLOCATION

Subject to the overall supervision of the
President and the Board, IMI (or MFC with respect to
Ivy Canada Fund and Ivy Global Natural Resources Fund)
places orders for the purchase and sale of each Fund's
portfolio securities. With respect to Ivy
International Fund, Northern Cross also places orders for the
purchase and sale of the Fund's portfolio securities. All
portfolio transactions are effected at the best price and
execution obtainable. Purchases and sales of debt
securities are usually principal transactions, and,
therefore, brokerage commissions are usually not
required to be paid by the particular Fund for such
purchases and sales (although the price paid generally
includes undisclosed compensation to the dealer). The
prices paid to underwriters of newly-issued securities usually
include a concession paid by the issuer to the underwriter,
and purchases of after-market securities from dealers
normally reflect the spread between the bid and asked
prices. In connection with OTC transactions, IMI (or
MFC for Ivy Canada Fund and Ivy Global Natural
Resources Fund and the Subadviser for Ivy International
Fund) attempts to deal directly with the principal
market makers, except in those circumstances where IMI (or MFC
for Ivy Canada Fund and Ivy Global Natural Resources Fund
and the Subadviser for Ivy International Fund) believes
that a better price and execution are available
elsewhere.

IMI (or MFC for Ivy Canada Fund and Ivy Global
Natural Resources Fund and the Subadviser for Ivy
International Fund) selects broker-dealers to execute
transactions and evaluates the reasonableness of
commissions on the basis of quality, quantity, and the
nature of the firms' professional services. Commissions
to be charged and the rendering of investment services, including
statistical, research, and counseling services by
brokerage firms, are factors to be considered in the
placing of brokerage business. The types of research
services provided by brokers may include general
economic and industry data, and information on
securities of specific companies. Research services furnished by
brokers through whom the Trust effects securities
transactions may be used by IMI (or MFC for Ivy Canada
Fund and Ivy Global Natural Resources Fund and the
Subadviser for Ivy International Fund) in servicing all
of its accounts. In addition, not all of these
services may be used by IMI (or MFC for Ivy Canada Fund and

Ivy Global Natural Resources Fund and the Subadviser
for Ivy International Fund) in connection with the
services it provides to a particular Fund or the Trust.
IMI (or MFC for Ivy Canada Fund and Ivy Global Natural
Resources Fund and the Subadviser for Ivy International
Fund) may consider sales of shares of a Fund as a
factor in the selection of broker-dealers and may select
broker-dealers who provide it with research services. IMI (or
MFC for Ivy Canada Fund and Ivy Global Natural Resources
Fund and the Subadviser for Ivy International Fund)
will not, however, execute brokerage transactions other
than at the best price and execution.

With respect to Ivy International Fund, when a
security proposed to be purchased or sold for the Fund
is also to be purchased or sold at the same time for
other accounts managed by the Subadviser, purchases or
sales are effected on a pro rata, rotating or other
equitable basis so as to avoid any one account being
preferred over any other account.

During the fiscal years ended June 30, 1993 and
1994, during the six-month period ended December 31,
1994 and during the fiscal year ended December 31,
1995, Ivy Canada Fund paid brokerage commissions of
$24,925, $202,849, $98,390 and $79,464, respectively.

During the period from October 23, 1993
(commencement of operations) to December 31, 1993, Ivy
China Region Fund paid brokerage commissions of
$43,919. During the fiscal years ended December 31,
1994 and December 31, 1995, Ivy China Region Fund paid
brokerage commissions of $26,579 and $70,459, respectively.

During the fiscal years ended June 30, 1993 and
1994, during the six-month period ended December 31,
1994, and during the fiscal year ended December 31,
1995, Ivy Global Fund paid brokerage commissions of
$31,789, $58,828, $43,367 and $96,124, respectively.

During the fiscal years ended December 31, 1993,
1994 and 1995, Ivy International Fund paid brokerage
commissions of $98,756, $139,426 and $715,524,
respectively.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994, Ivy
Latin America Strategy Fund and Ivy New Century Fund
each paid brokerage commissions of $5,491 and $2,611,
respectively. During the fiscal year ended December
31, 1995, Ivy Latin America Strategy Fund and Ivy New
Century Fund each paid brokerage commissions of $17,184 and
$15,236, respectively.

Brokerage commission information is not yet
available for Ivy Global Science & Technology Fund,
which commenced operations on July 22, 1996, and Ivy
Asia Pacific Fund, Ivy Global Natural Resources Fund
and Ivy International Small Companies Fund, which
commenced operations on January 1, 1997.

Each Fund may, under some circumstances, accept
securities in lieu of cash as payment for Fund shares.
Each of these Funds will accept securities only to
increase its holdings in a portfolio security or to
take a new portfolio position in a security that IMI
(and the Subadviser for Ivy International Fund) deems
to be a desirable investment for each the Fund. While no
minimum has been established, it is expected that each the Fund
will not accept securities having an aggregate value of
less than $1 million. The Trust may reject in whole or
in part any or all offers to pay for the Fund shares
with securities and may discontinue accepting
securities as payment for the Fund shares at any time
without notice. The Trust will value accepted
securities in the manner and at the same time provided for
valuing portfolio securities of each the Fund, and the Fund
shares will be sold for net asset value determined at the
same time the accepted securities are valued. The
Trust will only accept securities delivered in proper
form and will not accept securities subject to legal
restrictions on transfer. The acceptance of securities
by the Trust must comply with the applicable laws of
certain states.

TRUSTEES AND OFFICERS

The Trustees and Executive Officers of the Trust,
their business addresses and principal occupations
during the past five years are:

POSITION
WITH THE BUSINESS
AFFILIATIONS NAME, ADDRESS, AGE TRUST AND
PRINCIPAL OCCUPATIONS

John S. Anderegg, Jr. Trustee Chairman,
Dynamics 60 Concord Street Research
Corp. instruments Wilmington, MA 01887
and controls); Director, Age: 72
Burr-Brown Corp.
(operational amplifiers);
Director, Metritage
Incorporated (level
measuring instruments);
Trustee of Mackenzie Series
Trust (1992-present).

Paul H. Broyhill Trustee Chairman, BMC
Fund, Inc. 800 Hickory Blvd. (1983-
present); Chairman, Golfview Park-Box 500
Broyhill Family Foundation, Lenoir, NC 28645
Inc. (1983-Present); Age: 72
Chairman and President,
Broyhill Investments, Inc.
(1983-present); Chairman,
Broyhill Timber Resources
(1983-present); Management
of a personal
portfolio of
fixed-income and equity
investments (1983-present);
Trustee of Mackenzie Series
Trust (1988-present);
Director of The Mackenzie
Funds Inc. (1988-1995).

Stanley Channick Trustee President and
Chief 11 Bala Avenue Executive
Officer, The Bala Cynwyd, PA 19004
Whitestone Corporation Age: 73
(insurance agency);
Chairman, Scott Management
Company (administrative
services for insurance
companies); President, The
Channick Group (consultants
to insurance companies
and national
trade
associations); Trustee of
Mackenzie Series Trust
(1994-present); Director of
The Mackenzie Funds Inc.
(1994-1995).

Frank W. DeFriece, Jr. Trustee Director, Manager
and Vice The Landmark Centre
President, Director and 113 Landmark Lane,
Fund Manager, Massengill- Suite B
DeFriece Foundation Bristol, TN 37620-2285
(charitable organization) Age: 75
(1950-present); Trustee and
Vice Chairman, East
Tennessee Public
Communications Corp. (WSJK-
TV) (1984-present); Trustee
of Mackenzie Series
Trust (1985-
present); Director of
The Mackenzie Funds Inc.
(1987-1995).

Roy J. Glauber Trustee Mallinckrodt
Professor of Lyman Laboratory
Physics, Harvard of Physics
University (1974-present); Harvard University
Trustee of Mackenzie Series Cambridge, MA 02138
Trust (1994-present). Age: 71

Michael G. Landry Trustee President, Chief
Executive 700 South Federal Hwy. and Officer
and Suite 300 Chairman Director of
Mackenzie Boca Raton, FL 33432
Investment Management Age: 50
Inc. (1987-present); [*Deemed to be an
President, Director and "interested person"
Chairman of Ivy Management, of the Trust, as
Inc. (1992-present); defined under
the Chairman and Director of 1940
Act.] Ivy Mackenzie Services
Corp.(1993-present);
Chairman and Director of
Ivy Mackenzie
Distributors,
Inc. (1994-present);
Director and President of
Ivy Mackenzie Distributors,
Inc. (1993-1994); Director
and President of The
Mackenzie Funds Inc. (1987-
1995); Trustee and
President of Mackenzie
Series Trust (1987-
present).

Joseph G. Rosenthal Trustee Chartered
Accountant 110 Jardin Drive (1958-
present); Trustee Unit #12
of Mackenzie Series Concord, Ontario Canada
Trust (1985-present); L4K 2T7
Director of The Mackenzie Age: 62
Funds Inc. (1987-1995).

Richard N. Silverman Trustee Director, Newton-
Wellesley 18 Bonnybrook Road
Hospital; Director, Beth Waban, MA 02168
Israel Hospital; Director, Age: 72
Boston Ballet; Director,
Boston Children's Museum;
Director, Brimmer and May
School.

J. Brendan Swan Trustee President,
Airspray 4701 North Federal Hwy.
International, Inc.; Suite 465
Joint Managing Director, Pompano Beach, FL 33064
Airspray International Age: 66
B.V. (an environmentally
sensitive packaging
company); Director of
Polyglass LTD.; Director,
The Mackenzie Funds Inc.
(1992-1995); Trustee of
Mackenzie Series Trust
(1992-present).

Keith J. Carlson Trustee Senior Vice
President 700 South Federal Hwy. and and
Director of Mackenzie Suite 300 Vice
Investment Management, Boca Raton, FL 33432
President Inc. (1994-present); Age: 40
Senior Vice President, [*Deemed to be an
Treasurer of Mackenzie "interested
person" Investment Management Inc. of
the Trust, as (1989-1994); Senior Vice
defined under the President and Director
of 1940 Act.] Ivy
Management, Inc. (1994-
present); Senior Vice
President, Treasurer and
Director of Ivy Management,
Inc. (1992-1994); Vice
President of The Mackenzie
Funds Inc. (1987-1995);
Senior Vice President and
Director, Ivy
Mackenzie
Services Corp. (1996-
present); President and
Director of Ivy Mackenzie
Services Corp. (1993-1996);
Vice President of Mackenzie
Series Trust (1994-
present); Treasurer of
Mackenzie Series Trust
(1985-1994); President,
Chief Executive
Officer and
Director of Ivy Mackenzie
Distributors, Inc. (1994-
present); Executive Vice
President and Director of
Ivy Mackenzie Distributors,

Inc. (1993-1994);
Trustee of
Mackenzie Series Trust
(1996-present).

C. William Ferris Secretary/ Senior Vice
President, 700 South Federal Hwy. Treasurer Chief
Financial Officer Suite 300
and Secretary/Treasurer Boca Raton, FL 33432
of Mackenzie Investment Age: 52
Management Inc. (1995-
present); Senior Vice
President, Finance and
Administration/Compliance
Officer of Mackenzie
Investment Management Inc.
(1989-1994); Senior Vice
President, Secretary/
Treasurer and Clerk
of Ivy
Management, Inc. (1994-
present); Vice President,
Finance/Administration and
Compliance Officer of Ivy
Management, Inc. (1992-
1994); Senior Vice
President, Secretary/
Treasurer and Director of
Ivy Mackenzie
Distributors,
Inc. (1994-present);
Secretary/ Treasurer and
Director of Ivy Mackenzie
Distributors, Inc. (1993-
1994); President and
Director of Ivy Mackenzie
Services Corp. (1996-
present);

Secretary/Treasurer and
Director of Ivy Mackenzie
Services Corp. (1993-1996);
Secretary/ Treasurer of The
Mackenzie Funds Inc. (1993-
1995); Secretary/Treasurer
of Mackenzie Series
Trust (1994-
present).

James W. Broadfoot Vice Executive Vice
President, 700 South Federal Hwy. President Ivy
Management, Inc. (1996 Suite 300
-present); Senior Vice Boca Raton, FL 33432
President, Ivy Management, Age:54
Inc. (1992-1996); Director
and Senior Vice President,
Mackenzie Investment
Management Inc. (1995-
present); Senior Vice
President, Mackenzie
Investment Management
Inc.

(1990-1995);
Author/Consultant (1987-
1990).

PERSONAL INVESTMENTS BY EMPLOYEES OF IMI

Employees of IMI are permitted to make personal
securities transactions, subject to requirements and
restrictions set forth in IMI's Code of Ethics. The
Code of Ethics is designed to identify and address
certain conflicts of interest between personal
investment activities and the interests of investment
advisory clients such as the Funds. Among other things, the Code
of Ethics, which generally complies with standards
recommended by the Investment Company Institute's
Advisory Group on Personal Investing, prohibits certain
types of transactions absent prior approval, applies to
portfolio managers, traders, research analysts and
others involved in the investment advisory process, and
imposes time periods during which personal transactions may
not be made in certain securities, and requires the submission
of duplicate broker confirmations and monthly reporting
of securities transactions. Exceptions to these and
other provisions of the Code of Ethics may be granted
in particular circumstances after review by appropriate
personnel.

COMPENSATION TABLE
IVY FUND
(FISCAL YEAR ENDED DECEMBER 31, 1995)

TOTAL PENSION OR
COMPENSA- RETIREMENT
TION FROM
BENEFITS ESTIMATED TRUST AND
AGGREGATE ACCRUED AS ANNUAL FUND COM-
COMPENSA- PART OF BENEFITS PLEX PAID
NAME, TION FUND UPON TO
POSITION FROM TRUST EXPENSES RETIREMENT
TRUSTEES

John S. 7,112 N/A N/A
8,000 Anderegg, Jr.
(Trustee)

Paul H. 7,112 N/A N/A
8,000 Broyhill
(Trustee)

Stanley -0- N/A N/A
8,000 Channick[*]
(Trustee)

Frank W. 7,112 N/A N/A
8,000 DeFriece, Jr.
(Trustee)

Roy J. -0- N/A N/A
8,000 Glauber[*]
(Trustee)

Michael G. -0- N/A N/A
- -0- Landry
(Trustee and
President)

Joseph G. 7,112 N/A N/A
8,000 Rosenthal
(Trustee)

Richard N. 8,000 N/A N/A
8,000 Silverman
(Trustee)

J. Brendan 7,112 N/A N/A
8,000 Swan
(Trustee)

Michael R. 8,000 N/A N/A
8,000 Peers[**]
(Trustee and
Chairman)

C. William -0- N/A N/A
- -0- Ferris
(Secretary/Treasurer)

[*] Appointed as a Trustee of the Trust at a meeting
of the Board of Trustees held on February 10,
1996.

[**] Resigned as a Trustee of the Trust effective
December 7, 1996. Keith J. Carlson was
appointed as a Trustee of the Trust on
December 7, 1996.

As of December 6, 1996, the Officers and Trustees
of the Trust as a group owned beneficially less than 1%
of the outstanding Class A, Class B, Class C and Class
I shares of the Funds, except that as of such date, the
Officers and Trustees of the Trust as a group owned
beneficially 1.07% of Ivy Money Market Fund Class A
shares, 4.56% of Ivy Latin America Strategy Fund Classs
A shares and 2.35% of Ivy Global Fund Class A shares.

INVESTMENT ADVISORY AND OTHER SERVICES

BUSINESS MANAGEMENT AND INVESTMENT ADVISORY SERVICES

IMI provides business management and investment
advisory services to each Fund (other than Ivy Canada
Fund and Ivy Global Natural Resources Fund) pursuant to
a Business Management and Investment Advisory Agreement
(the "Agreement"). IMI provides business management
services to Ivy Canada Fund and Ivy Global Natural
Resources Fund pursuant to a Business Management
Agreement (the "Management Agreement"). The Agreement (or the
Management Agreement, in the case of Ivy Canada Fund and
Ivy Global Natural Resources Fund) was approved (i) by
the sole shareholder of Ivy China Region Fund on
October 23, 1993, (ii) by the shareholders of Ivy
International Fund on December 30, 1991, (iii) by the
sole shareholder of each of Ivy Latin America Strategy
Fund and Ivy New Century Fund on October 28, 1994, (iv)
by the sole shareholder of each of Ivy Global Fund and Ivy Canada
Fund on January 27, 1995, (v) by the sole shareholder of
Ivy Global Science & Technology Fund on July 16, 1996,
and (vi) by the sole shareholder of each of Ivy Asia
Pacific Fund, Ivy Global Natural Resources Fund and Ivy
International Small Companies Fund on December 13,
1996. Prior to shareholder approval, the Agreement (or
the Management Agreement, in the case of Ivy Canada
Fund and Ivy Global Natural Resources Fund) was approved by the
Board (including a majority of the Trustees who are
neither "interested persons," as defined in the 1940
Act, of the Trust nor have any direct or indirect
financial interest in the operation of the distribution
plan or in any related agreement (the "Independent
Trustees")) (i) on August 23, 1993 with respect to Ivy
China Region Fund, (ii) on October 28, 1991 with respect
to Ivy International Fund, (iii) on September 17, 1994 with
respect to Ivy Latin America Strategy Fund and Ivy New Century
Fund, (iv) on September 29, 1994 with respect to each of
Ivy Canada Fund and Ivy Global Natural Resources Fund,
(v) on June 8, 1996 with respect to Ivy Global Science
& Technology Fund, and (vi) on December 7, 1996 with
respect to each of Ivy Asia Pacific Fund, Ivy Global
Natural Resources Fund and Ivy International Small
Companies Fund.

Until January 31, 1995 MIMI served as the manager
and investment adviser to Ivy Global Fund and as
manager to Ivy Canada Fund, which were then series of
The Mackenzie Funds Inc. (the "Company"). On January
31, 1995, MIMI's interest in the Agreement (in the case
of Ivy Global Fund) and in the Management Agreement (in
the case of Ivy Canada Fund) was assigned by MIMI to
IMI, which is a wholly owned subsidiary of MIMI. The
provisions of the Agreement and the Management Agreement remain
unchanged by IMI's succession to MIMI thereunder. MIMI is
a subsidiary of MFC, 150 Bloor Street West, Toronto,
Ontario, Canada, a public corporation organized under
the laws of Ontario and registered in Ontario as a
mutual fund dealer whose shares are listed for trading
on the TSE. MFC provides investment advisory services
to Ivy Canada Fund and Ivy Global Natural

Resources Fund pursuant to an Investment Advisory
Agreement (the "MFC Agreement"). The MFC Agreement was
approved (i) by the sole shareholder of Ivy Canada Fund
on January 27, 1995 and (ii) by the sole shareholder of
Ivy Global Natural Resources Fund on December 13, 1996.
Prior to shareholder approval, the MFC Agreement was
approved by the Board (including a majority of
Independent Trustees) (i) on September 29, 1994 with respect to
Ivy Canada Fund and (ii) on December 7, 1996 with respect
to Ivy Global Natural Resources Fund.

IMI currently acts as manager and investment
adviser to the following additional investment
companies registered under the 1940 Act: Ivy Growth
Fund, Ivy Emerging Growth Fund, Ivy Growth with Income
Fund, Ivy Bond Fund, Ivy International Bond Fund and
Ivy Money Market Fund.

The Agreement obligates IMI to make investments
for the accounts of each Fund (except Ivy Canada Fund
and Ivy Global Natural Resources Fund) in accordance
with its best judgment and within the investment
objectives and restrictions set forth in the
Prospectus, the 1940 Act and the provisions of the Code
relating to regulated investment companies, subject to policy
decisions adopted by the Board. IMI also determines the
securities to be purchased or sold by these Funds and places
orders with brokers or dealers who deal in such
securities. The Advisory Agreement obligates MFC to
make investments for the account of each of Ivy Canada
Fund and Ivy Global Natural Resources Fund, in
accordance with its best judgment and within the
investment objectives and restrictions set forth in the
Prospectus with respect to each of Ivy Canada Fund and Ivy Global
Natural Resources Fund, the 1940 Act and the provisions
of the Code, relating to regulated investment
companies, subject to policy decisions adopted by the
Board. MFC also determines the securities to be
purchased or sold by each of Ivy Canada Fund and Ivy
Global Natural Resources Fund and places orders with brokers
or dealers who deal in such securities.

Under the Agreement (the Management Agreement with
respect to Ivy Canada Fund and Ivy Global Natural
Resources Fund), IMI also provides certain business
management services. IMI is obligated to (1)
coordinate with each Fund's Custodian and monitor the
services it provides to that Fund; (2) coordinate with
and monitor any other third parties furnishing services to
each Fund; (3) provide each Fund with necessary office space,
telephones and other communications facilities as are
adequate for the particular Fund's needs; (4) provide
the services of individuals competent to perform
administrative and clerical functions that are not
performed by employees or other agents engaged by the
particular Fund or by IMI acting in some other capacity
pursuant to a separate agreement or arrangements with
the Fund; (5) maintain or supervise the maintenance by third
parties of such books and records of the Trust as may be
required by applicable Federal or state law; (6)
authorize and permit IMI's directors, officers and
employees who may be elected or

appointed as trustees or officers of the Trust to serve
in such capacities; and (7) take such other action with
respect to the Trust, after approval by the Trust as
may be required by applicable law, including without
limitation the rules and regulations of the SEC and of
state securities commissions and other regulatory
agencies. Pursuant to the Management Agreement, IMI is
also responsible for reviewing the activities of MFC to
insure that each of Ivy Canada Fund and Ivy Global Natural
Resources Fund is operated in compliance with each such Fund's
investment objectives and policies and with the 1940 Act.

Ivy Global Fund pays IMI a monthly fee for
providing business management and investment advisory
services at an annual rate of 1.00% of the first $500
million of its average net assets, reduced to 0.75% on
average net assets over $500 million. Each of the
other Funds (except Ivy Canada Fund and Ivy Global
Natural Resources Fund) pays IMI a monthly fee for providing
business management and investment advisory serves at an
annual rate of 1.00% of each of the Fund's average net
assets. Ivy Canada Fund and Ivy Global Natural
Resources Fund each pays IMI a monthly fee for
providing business management services at an annual
rate of 0.50% of each such Fund's average net assets.

For advisory services, Ivy Canada Fund and Ivy
Global Natural Resources Fund each pays MFC a monthly
fee at an annual rate of 0.35% and 0.50%, respectively,
of the average net assets of each such Fund. For the
fiscal years ended June 30, 1993 and 1994, for the six-
month period ended December 31, 1994 and for the fiscal
year ended December 31, 1995, Ivy Canada Fund paid MFC
fees of $47,671, $120,495, $54,763 and $67,229, respectively.

For the period from October 23, 1993 (commencement
of operations) to December 31, 1993 and during the
fiscal years ended December 31, 1994 and 1995, Ivy
China Region Fund paid IMI $10,340, $193,875 and
$200,605, respectively (of which IMI reimbursed $0,
$1,036 and $0, respectively, pursuant to required
expense limitations and of which IMI reimbursed $2,907, $106,631
and $106,085, respectively, pursuant to voluntary expense
limitations).

During the fiscal years ended June 30, 1993 and
1994 and during the six-month period ended December 31,
1994, MIMI, as investment manager to Ivy Canada Fund
and as investment adviser to Ivy Global Fund, when each
was a series of the Company, received fees of $68,102,
$172,136 and $78,234, respectively, from Ivy Canada
Fund and $104,015, $155,540 and $107,966, respectively,
(of which MIMI reimbursed $581, $0 and $0,
respectively, pursuant to required expense limitations and of
which MIMI reimbursed $83,214, $34,779 and $15,264,
respectively, pursuant to voluntary expense
limitations) from Ivy Global Fund. During the fiscal
year ended December 31, 1995, IMI received fees of
$96,041 from Ivy Canada Fund (of which IMI reimbursed $63,466
pursuant to required expense limitations) and $239,963 from
Ivy

Global Fund (of which IMI reimbursed $62,242 pursuant
to voluntary expense limitations).

For the fiscal years ended December 31, 1993, 1994
and 1995, Ivy International Fund paid IMI fees of
$1,302,526, $2,217,950 and $3,948,456, respectively.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994 and
during the fiscal year ended December 31, 1995, Ivy
Latin America Strategy Fund paid IMI fees of $1,006 and
$95,380, respectively (of which IMI reimbursed IMI
reimbursed $13,333 and $93,340, respectively, pursuant to
required expense limitations and of which IMI reimbursed $523
and $2,040, respectively, pursuant to voluntary expense
limitations) and Ivy New Century Fund paid IMI fees of
$912 and $91,226, respectively (of which IMI reimbursed
$16,415 and $87,348, respectively, pursuant to required
expense limitations and of which IMI reimbursed $512
and $3,878, respectively, pursuant to voluntary expense
limitations).

Advisory fee information is not yet available for
Ivy Global Science & Technology Fund, which commenced
operations on July 22, 1996, and Ivy Asia Pacific Fund,
Ivy Global Natural Resources Fund and Ivy International
Small Companies Fund, which commenced operations on
January 1, 1997.

Under the Agreement (or the Management Agreement
and the Advisory Agreement with respect to Ivy Canada
Fund and Ivy Global Natural Resources Fund), the Trust
pays the following expenses: (1) the fees and expenses
of the Trust's Independent Trustees; (2) the salaries
and expenses of any of the Trust's officers or
employees who are not affiliated with IMI; (3) interest expenses;
(4) taxes and governmental fees, including any original
issue taxes or transfer taxes applicable to the sale or
delivery of shares or certificates therefor; (5)
brokerage commissions and other expenses incurred in
acquiring or disposing of portfolio securities; (6) the
expenses of registering and qualifying shares for sale
with the SEC and with various state securities
commissions; (7) accounting and legal costs; (8) insurance
premiums; (9) fees and expenses of the Trust's Custodian and
Transfer Agent and any related services; (10) expenses of
obtaining quotations of portfolio securities and of
pricing shares; (11) expenses of maintaining the
Trust's legal existence and of shareholders' meetings;
(12) expenses of preparation and distribution to
existing shareholders of periodic reports, proxy
materials and prospectuses; and (13) fees and expenses of
membership in industry organizations.

IMI currently limits each Fund's (with the
exception of Ivy Canada Fund and Ivy International
Fund) total operating expenses (excluding Rule 12b-1
fees, interest, taxes, brokerage commissions,
litigation and indemnification expenses, and other
extraordinary expenses) to an annual rate of 1.95% of the Fund's
average net assets, which may lower that Fund's expenses
and

increase its yield. Each Fund's expense limitation may
be terminated or revised at any time, at which time its
expenses may increase and its yield may be reduced.

On August 23-24, 1996, the Board (including a
majority of the Independent Trustees) (i) approved the
continuance of the Agreement with respect to Ivy China
Region Fund, Ivy Global Fund, Ivy International Fund,
Ivy Latin America Strategy Fund and Ivy New Century
Fund and (ii) approved the continuance of the
Management Agreement for Ivy Canada Fund. The initial term of
the Agreement (or the Management Agreement with respect to
Ivy Global Natural Resources Fund) between IMI and each
of Ivy Asia Pacific Fund, Ivy Global Natural Resources
Fund and Ivy International Small Companies Fund, which
are commencing on January 1, 1997, will run for a
period of two years from the date of commencement.
Each Agreement (or Management Agreement, with respect
to Ivy Canada Fund and Ivy Global Natural Resources Fund)
will continue in effect with respect to each Fund from year to
year, or for more than the initial period, as the case may
be, only so long as the continuance is specifically
approved at least annually (i) by the vote of a
majority of the Independent Trustees and (ii) either
(a) by the vote of a majority of the outstanding voting
securities (as defined in the 1940 Act) of the
particular Fund or (b) by the vote of a majority of the entire
Board. If the question of continuance of the Agreements
(or adoption of any new agreement) is presented to
shareholders, continuance (or adoption) shall be
effected only if approved by the affirmative vote of a
majority of the outstanding voting securities of the
particular Fund. See "Capitalization and Voting
Rights."

Each Agreement (or Management Agreement with
respect to Ivy Canada Fund and Ivy Global Natural
Resources Fund) may be terminated with respect to a
particular Fund at any time, without payment of any
penalty, by the vote of a majority of the Board, or by
a vote of a majority of the outstanding voting securities
of that Fund, on 60 days' written notice to IMI, or by IMI on 60
days' written notice to the Trust. The Agreement shall
terminate automatically in the event of its
assignment.

SUBADVISORY CONTRACT - IVY INTERNATIONAL FUND.
The Trust and IMI, on behalf of Ivy International Fund,
have entered into a subadvisory contract with an
independent investment adviser (the "Subadvisory
Contract") under which the subadviser develops,
recommends and implements an investment program and strategy for
the Fund's portfolio and is responsible for making all
portfolio security and brokerage decisions, subject to
the supervision of IMI and, ultimately, the Board.
Fees payable under the Subadvisory Contract accrue
daily and are paid quarterly by IMI. Effective April
1, 1993, Northern Cross serves as subadviser for Ivy
International Fund's portfolio pursuant to the Subadvisory
Contract. As compensation for its services, Northern Cross is
paid a fee by IMI at the annual rate of 0.60% of Ivy
International Fund's average net assets. As compensation for

advisory services rendered for the period from April 1,
1993 to December 31, 1993 and for the fiscal years
ended December 31, 1994 and 1995, IMI paid Northern
Cross $617,520, $1,330,770 and $2,369,074,
respectively. Northern Cross, wholly-owned and
operated by Hakan Castegren, is the successor to the investment
advisory functions of Boston Overseas Investors, Inc.
("BOI"), which also was wholly-owned and operated by
Hakan Castegren. Boston Investor Services, Inc., the
successor to the administrative and research functions
of BOI, provides administrative and research services
to Northern Cross.

BOI served as subadviser for Ivy International
Fund's portfolio from July 1, 1990 until March 31,
1993. Under its subadvisory contract, IMI paid BOI a
fee at an annual rate of 0.60% of the Fund's average
net assets. As compensation for advisory services
rendered for the three-month period ended March 31,
1993, IMI paid BOI $163,879.

Any amendment to the current Subadvisory Contract
requires approval by votes of (a) a majority of the
outstanding voting securities of Ivy International Fund
affected thereby and (b) a majority of the Trustees who
are not interested persons of the Trust or of any other
party to such Contract. The Subadvisory Contract
terminates automatically in the event of its assignment
(as defined in the 1940 Act) or upon termination of the
Agreement. Also, the Subadvisory Contract may be terminated by
not more than 60 days' nor less than 30 days' written
notice by either the Trust or IMI or upon not less than
120 days' notice by the Subadviser. The Subadvisory
Contract provides that IMI or the Subadviser shall not
be liable to the Trust, to any shareholder of the
Trust, or to any other person, except for loss
resulting from willful misfeasance, bad faith, gross negligence
or reckless disregard of duty.

The Subadvisory Contract will continue in effect
(subject to provisions for earlier termination as
described above) only if such continuance is approved
at least annually (a) by a majority of the Trustees who
are not interested persons of the Trust or of any other
party to the Contract and (b) by either (i) a majority
of all of the Trustees of the Trust or (ii) a vote of a majority
of the outstanding voting securities of any Fund affected
thereby. On September 17, 1994, the Board, including a
majority of the Independent Trustees, last approved the
continuance of the Subadvisory Contract.

DISTRIBUTION SERVICES

IMDI, a wholly owned subsidiary of MIMI, serves as
the exclusive distributor of the Funds' shares pursuant
to an Amended and Restated Distribution Agreement with
the Trust dated October 23, 1991, as amended from time
to time (the "Distribution Agreement"). The
Distribution Agreement was last approved by the Board
of Trustees on August 25, 1996. IMDI distributes shares of
the Funds through broker-dealers who are members of the
National

Association of Securities Dealers, Inc. and who have
executed dealer agreements with IMDI. IMDI distributes
shares of the Funds on a continuous basis, but reserves
the right to suspend or discontinue distribution on
that basis. IMDI is not obligated to sell any specific
amount of Fund shares.

Pursuant to the Distribution Agreement, IMDI is
entitled to deduct a commission on all Class A Fund
shares sold equal to the difference, if any, between
the public offering price, as set forth in the Funds'
then-current prospectus, and the net asset value on
which such price is based. Out of that commission, IMDI
may reallow to dealers such concession as IMDI may determine from
time to time. In addition, IMDI is entitled to deduct a
CDSC on the redemption of Class A shares sold without
an initial sales charge and Class B and Class C shares
in accordance with, and in the manner set forth in, the
Prospectus.

Under the Distribution Agreement, each Fund bears,
among other expenses, the expenses of registering and
qualifying its shares for sale under federal and state
securities laws and preparing and distributing to
existing shareholders periodic reports, proxy materials
and prospectuses.

During the fiscal year ended June 30, 1993 and the
three months ended September 30, 1993, MIMI, which at
that time was Ivy Canada Fund's distributor, received
from sales of Class A [FN][Shares of Ivy Canada Fund
outstanding as of March 31, 1994 were designated Class
A shares of the Fund.] shares of Ivy Canada Fund
$395,698 and $332,241, respectively, in sales commissions,
of which $59,871 and $52,414, respectively, was retained after
dealers' reallowances. During the nine months ended June
30, 1994, the six-month period ended December 31, 1994
and the fiscal year ended December 31, 1995, IMDI
received commissions of $386,239, $44,748 and $45,959,
respectively, from sales of Class A shares of the Fund,
of which $62,036, $7,074 and $7,824, respectively, was
retained after dealers' reallowances. During the
period April 1, 1994 (commencement of sales of Class B
shares) to June 30, 1994 and the six-month period ended December
31, 1994 and the fiscal year ended December 31, 1995,
IMDI received $574 and $2,387, respectively, in CDSCs
on redemptions of Class B shares of Ivy Canada Fund.

During the period from October 23, 1993
(commencement of operations) to December 31, 1993 and
during the fiscal years ended December 31, 1994 and
December 31, 1995, IMDI received from sales of Class A
shares of Ivy China Region Fund $215,030, $328,530 and
$132,337, respectively, in sales commissions, of which
$33,451, $52,347 and $9,919, respectively, was retained
after dealers' re-allowances. During the period from October 23,
1993 (commencement of operations) to December 31, 1993,
IMDI received no CDSCs on Class B shares of Ivy China
Region Fund. During the fiscal years ended December
31, 1994 and December 31, 1995, IMDI received $17,290
and $48,686, respectively, in CDSCs on redemptions of
Class B shares of the Fund.

During the fiscal years ended June 30, 1993 and
the three month period ended September 30, 1993, MIMI,
which at that time was Ivy Global Fund's distributor,
received from sales of Class A [FN][Shares of Ivy
Global Fund outstanding as of March 31, 1994 were
designated Class A shares of the Fund.] shares of Ivy Global
Fund $192,128 and $57,279, respectively, in sales
commissions, of which $35,500 and $8,869, respectively,
was retained after dealers' reallowances. During the
nine months ended June 30, 1994, the six-month period
ended December 31, 1994 and the fiscal year ended
December 31, 1995, IMDI received commissions of
$166,539, $96,349 and $150,828, respectively, from sales of Class
A shares of the Fund, of which $25,240, $16,508 and
$23,153, respectively, was retained after dealers'
reallowances. During the period April 1, 1994
(commencement of sales of Class B shares) to December
31, 1994 and during the fiscal year ended December 31,
1995, IMDI received $0 and $2,833, respectively, in
CDSCs on redemptions of Class B shares of Ivy Global Fund.

During the period from January 1, 1993 to
September 30, 1993, MIMI, which at that time was Ivy
International Fund's distributor, received from sales
of Class A shares of the Fund $262,908 in sales
commissions, of which $41,306 was retained after
dealers' re-allowances. During the period from October 1,
1993 to December 31, 1993, IMDI received from sales of Class A
shares of Ivy International Fund $215,623 in sales
commissions, of which $33,877 was retained after
dealers' re-allowances. During the fiscal years ended
December 31, 1994 and December 31, 1995, IMDI received
from sales of Class A shares of Ivy International Fund
$788,610 and $931,967, respectively, in sales
commissions, of which $124,786 and $144,220, respectively, was
retained after dealers' re-allowances. During the period
from January 1, 1993 to September 30, 1993, and from
October 1, 1993 to December 31, 1993, MIMI and IMDI,
respectively, received no CDSCs upon certain
redemptions of Class A shares of Ivy International
Fund. During the period from October 23, 1993 (the
date on which Class B shares of Ivy International Fund were first
offered for sale to the public) to December 31, 1993,
IMDI received $439 in CDSCs paid upon certain
redemptions of Class B shares of Ivy International
Fund. During the fiscal years ended December 31, 1994
and December 31, 1995, IMDI received $23,381 and
$102,532, respectively, in CDSCs paid upon certain
redemptions of Class B shares of Ivy International Fund.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994 and
during the fiscal year ended December 31, 1995, IMDI
received from sales of Class A shares of Ivy Latin
America Strategy Fund $7,492 and $65,204, respectively,
in sales commissions, of which $1,071 and $8,435, respectively,
was retained after dealers re-allowances. During the
period from November 1, 1994 (commencement of
operations) to December 31, 1994, IMDI received no
CDSCs on redemptions of Class B shares of Ivy Latin
America Strategy Fund. During the fiscal year ended
December 31, 1995, IMDI received $447 in CDSCs on redemptions of
Class B shares of the Fund.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994 and
during the fiscal year ended December 31, 1995, IMDI
received from sales of Class A Shares of Ivy New
Century Fund $5,766 and $96,634, respectively, in sales
commissions, of which $865 and $14,419, respectively, was
retained after dealer re-allowances. During the period from
November 1, 1994 (commencement of operations) to December
31, 1994, IMDI received no CDSCs on redemptions of
Class B Shares of Ivy New Century Fund. During the
fiscal year ended December 31, 1995, IMDI received $813
in CDSCs on redemptions of Class B shares of the Fund.

Since the inception date for Class C shares of
each Fund is April 30, 1996, no payments were made in
connection with the sale of Class C shares with respect
to any Fund during the relevant time periods. Further,
none of Ivy Asia Pacific Fund, Ivy Global Natural
Resources Fund, Ivy Global Science & Technology Fund or
Ivy International Small Companies Fund had commenced
operations.

Each Distribution Agreement will continue in
effect for successive one-year periods, provided that
such continuance is specifically approved at least
annually by the vote of a majority of the Independent
Trustees, cast in person at a meeting called for that
purpose and by the vote of either a majority of the
entire Board or a majority of the outstanding voting securities
of each Fund. Each Distribution Agreement may be
terminated with respect to a particular Fund at any
time, without payment of any penalty, by IMDI on 60
days' written notice to the particular Fund or by a
Fund by vote of either a majority of the outstanding
voting securities of the Fund or a majority of the Independent
Trustees on 60 days' written notice to IMDI. Each
Distribution Agreement shall terminate automatically in
the event of its assignment.

RULE 18F-3 PLAN. On February 23, 1995, the SEC
adopted Rule 18f-3 under the 1940 Act, which permits a
registered open-end investment company to issue
multiple classes of shares in accordance with a written
plan approved by the investment company's board of
directors/trustees and filed with the SEC. At a
meeting held on December 1-2, 1995, the Board adopted a multi-
class plan (the "Rule 18f-3 plan") on behalf of each Fund.
At a meeting held on December 7, 1996, the Board last
approved the Rule 18f-3 plan on behalf of each Fund.
The key features of the Rule 18f-3 plan are as follows:
(i) shares of each class of a Fund represent an equal
pro rata interest in that Fund and generally have
identical voting, dividend, liquidation, and other
rights, preferences, powers, restrictions, limitations,
qualifications, terms and conditions, except that each class
bears certain class-specific expenses and has separate voting
rights on certain matters that relate solely to that
class or in which the interests of shareholders of one
class differ from the interests of shareholders of
another class; (ii) subject to certain limitations
described in the Prospectus, shares of a

particular class of a Fund may be exchanged for shares
of the same class of another Ivy or Mackenzie fund; and
(iii) a Fund's Class B shares will convert
automatically into Class A shares of that Fund after a
period of eight years, based on the relative net asset
value of such shares at the time of conversion.

RULE 12B-1 DISTRIBUTION PLANS. The Trust has
adopted on behalf of each Fund, in accordance with Rule
12b-1 under the 1940 Act, separate Rule 12b-1
distribution plans pertaining to the Funds' Class A,
Class B and Class C shares (each, a "Plan"). In
adopting each Plan, a majority of the Independent Trustees
concluded in accordance with the requirements of Rule 12b-1
that there is a reasonable likelihood that each Plan
will benefit each Fund and its shareholders. The
Trustees of the Trust believe that the Plans should
result in greater sales and/or fewer redemptions of
each Fund's shares, although it is impossible to know
for certain the level of sales and redemptions of a Fund's
shares in the absence of a Plan or under an alternative
distribution arrangement.

Under each Plan, each Fund pays IMDI a service
fee, accrued daily and paid monthly, at the annual rate
of up to 0.25% of the average daily net assets
attributable to its Class A, Class B or Class C shares,
as the case may be. The services for which service
fees may be paid include, among other things, advising
clients or customers regarding the purchase, sale or retention of
shares of the Fund, answering routine inquiries
concerning the Fund and assisting shareholders in
changing options or enrolling in specific plans.
Pursuant to each Plan, service fee payments made out of
or charged against the assets attributable to a Fund's
Class A, Class B or Class C shares must be in
reimbursement for services rendered for or on behalf of the
affected class. The expenses not reimbursed in any one month
may be reimbursed in a subsequent month. The Class A
Plan (other than the Class A Plan for Ivy Canada Fund)
does not provide for the payment of interest or
carrying charges as distribution expenses.

Under the Funds' Class B and Class C Plans, each
Fund also pays IMDI a distribution fee, accrued daily
and paid monthly, at the annual rate of 0.75% of the
average daily net assets attributable to its Class B or
Class C shares. Ivy Canada Fund also pays IMDI a
distribution fee, accrued daily and paid monthly, at
the annual rate of 0.15% of the average daily assets
attributable to its Class A shares. IMDI may reallow to dealers
all or a portion of the service and distribution fees as
IMDI may determine from time to time. The distribution
fee compensates IMDI for expenses incurred in
connection with activities primarily intended to result
in the sale of the Funds' Class B or Class C shares
(and Class A shares, in the case of Ivy Canada Fund),
including the printing of prospectuses and reports for
persons other than existing shareholders and the preparation,
printing and distribution of sales literature and
advertising materials. Pursuant to each Class B and
Class C Plan (and Ivy

Canada Fund's Class A Plan), IMDI may include interest,
carrying or other finance charges in its calculation of
distribution expenses, if not prohibited from doing so
pursuant to an order of or a regulation adopted by the
SEC.

Among other things, each Plan provides that (1)
IMDI will submit to the Board at least quarterly, and
the Trustees will review, written reports regarding all
amounts expended under the Plan and the purposes for
which such expenditures were made; (2) each Plan will
continue in effect only so long as such continuance is
approved at least annually, and any material amendment
thereto is approved, by the votes of a majority of the
Board, including the Independent Trustees, cast in person at a
meeting called for that purpose; (3) payments by each Fund
under each Plan shall not be materially increased
without the affirmative vote of the holders of a
majority of the outstanding shares of the relevant
class; and (4) while each Plan is in effect, the
selection and nomination of Trustees who are not
"interested persons" (as defined in the 1940 Act) of the Trust
shall be committed to the discretion of the Trustees who
are not "interested persons" of the Trust.

IMDI may make payments for distribution assistance
and for administrative and accounting services from
resources that may include the management fees paid (to
MIMI, in the case of Ivy Canada Fund and Ivy Global
Natural Resources Fund) by a Fund. IMDI also may make
payments (such as the service fee payments described
above) to unaffiliated broker-dealers for services
rendered in the distribution of each Fund's shares. To qualify
for such payments, shares may be subject to a minimum
holding period. However, no such payments will be made
to any dealer or broker if at the end of each year the
amount of shares held does not exceed a minimum amount.
The minimum holding period and minimum level of
holdings will be determined from time to time by
IMDI.

A report of the amount expended pursuant to each
Plan, and the purposes for which such expenditures were
incurred, must be made to the Board for its review at
least quarterly.

During the period from October 1, 1993 to June 30,
1994, during the six-month period ended December 31,
1994 and during the fiscal year ended December 31,
1995, Ivy Canada Fund paid IMDI $92,079, $61,133 and
$73,233, respectively, pursuant to its Class A plan.
During the period from April 1, 1994 (the date on which
Class B shares of Ivy Canada Fund were first offered to the
public) to June 30, 1994, during the six-month period ended
December 31, 1994 and during the fiscal year ended December
31, 1995, Ivy Canada Fund paid IMDI $312, $2,953 and
$8,964, respectively, pursuant to its the Class B plan.

For the period from October 23, 1993 (commencement
of operations) to December 31, 1993 and during the
fiscal years ended December 31, 1994 and December 31,
1995, Ivy China Region

Fund paid IMDI $1,844, $31,640 and $32,647,
respectively, pursuant to its Class A Plan. For the
period from October 23, 1993 (commencement of
operations) to December 31, 1993 and during the fiscal
years ended December 31, 1994 and December 31, 1995,
Ivy China Region Fund paid IMDI $2,962, $67,315 and $70,020,
respectively, pursuant to its Class B Plan.

During the period from October 1, 1993 to June 30,
1994, during the six-month period ended December 31,
1994 and during the fiscal year ended December 31,
1995, Ivy Global Fund paid IMDI $30,665, $24,936 and
$50,833, respectively, pursuant to its Class A plan.
During the period from April 1, 1994 (the date on which
Class B shares of Ivy Global Fund were first offered to the
public) to June 30, 1994, during the six-month period ended
December 31, 1994 and during the fiscal year ended December
31, 1995, the Fund paid IMDI $434, $8,224 and $36,632,
respectively, pursuant to its Class B plan.

For the period from January 1, 1993 to September
30, 1993, Ivy International Fund paid MIMI $22,673
pursuant to its Class A Plan. For the period from
October 1, 1993 to December 31, 1993, the Fund paid
IMDI $9,196 pursuant to its Class A Plan. For the
fiscal years ended December 31, 1994 and December 31, 1995, Ivy
International Fund paid IMDI $168,356 and $281,215,
respectively, pursuant to its Class A Plan. For the
period from October 23, 1993 (the date on which Class B
shares of Ivy International Fund were first offered for
sale to the public) to December 31, 1993, the Fund paid
IMDI $2,339 pursuant to its Class B Plan. For the
fiscal years ended December 31, 1994 and December 31, 1995, the
Fund paid IMDI $175,505 and $474,670, respectively,
pursuant to its Class B Plan.

Since the inception date for Class C shares of
each Fund is April 30, 1996, no payments were made
pursuant to the Funds' Class C Plan during the relevant
time periods. Further, no payments were made with
respect to Ivy Global Science & Technology Fund, which
commenced operations on July 22, 1996, or Ivy Asia
Pacific Fund, Ivy Global Natural Resources Fund and Ivy
International Small Companies Fund, which commenced operations on
January 1, 1997.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994 and
during the fiscal year ended December 31, 1995, Ivy
Latin America Strategy Fund paid IMDI $208 and $2,637,
respectively, pursuant to its Class A plan. During the
period from November 1, 1994 (commencement of operations) to
December 31, 1994 and during the fiscal year ended December
31, 1995, the Fund paid IMDI $157 and $3,855,
respectively, pursuant to its Class B plan.

During the period from November 1, 1994
(commencement of operations) to December 31, 1994 and
during the fiscal year ended December 31, 1995, Ivy New
Century Fund paid IMDI $196 and $3,888, respectively,
pursuant to its Class A plan. During the

period from November 1, 1994 (commencement of
operations) to December 31, 1994 and during the fiscal
year ended December 31, 1995, the Fund paid IMDI $124
and $4,160, respectively, pursuant to its Class B plan.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy Canada Fund: advertising, $4,295;
printing and mailing of prospectuses to persons other
than current shareholders, $23,665; compensation to
dealers, $17,887; compensation to sales
personnel,$38,389; seminars and meetings, $4,471; travel and
entertainment, $9,964; general and administrative, $20,597;
telephone, $1,271; and occupancy and equipment rental,
$3,201.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy Canada Fund: advertising, $264;
printing and mailing of prospectuses to persons other
than current shareholders, $1,454; compensation to
dealers, $1,099; compensation to sales
personnel,$2,359; seminars and meetings, $275; travel and
entertainment, $612; general and administrative, $1,266;
telephone, $78; and occupancy and equipment rental, $197.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy China Region Fund: advertising,
$2,677; printing and mailing of prospectuses to persons
other than current shareholders, $29,558; compensation
to dealers, $23,976; compensation to sales
personnel,$18,697; seminars and meetings, $5,994; travel and
entertainment, $4,704; general and administrative, $10,914;
telephone, $608; and occupancy and equipment rental,
$1,534.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy China Region Fund: advertising,
$1,430; printing and mailing of prospectuses to persons
other than current shareholders, $15,848; compensation
to dealers, $12,855; compensation to sales
personnel,$10,025; seminars and meetings, $3,214; travel and
entertainment, $2,523; general and administrative, $5,852;
telephone, $326; and occupancy and equipment rental, $822.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy Global Fund: advertising, $5,843;
printing and mailing of prospectuses to persons other
than current shareholders, $27,934; compensation to
dealers, $39,757; compensation to sales
personnel,$60,170; seminars and meetings, $9,939; travel and
entertainment, $15,857; general and administrative, $29,677;
telephone, $2,071; and occupancy and equipment rental,
$5,051.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy Global Fund: advertising, $1,053;
printing and mailing of prospectuses to persons other
than current shareholders, $5,032;

compensation to dealers, $7,162; compensation to sales
personnel,$10,840; seminars and meetings, $1,791; travel
and entertainment, $2,857; general and administrative,
$5,346; telephone, $373; and occupancy and equipment
rental, $910.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy International Fund: advertising,
$77,492; printing and mailing of prospectuses to
persons other than current shareholders, $132,769;
compensation to dealers, $455,975; compensation to
sales personnel,$517,288; seminars and meetings, $113,994; travel
and entertainment, $129,225; general and administrative,
$301,697; telephone, $17,067; and occupancy and
equipment rental, $42,223.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy International Fund: advertising,
$10,840; printing and mailing of prospectuses to
persons other than current shareholders, $18,573;
compensation to dealers, $63,786; compensation to sales
personnel,$72,363; seminars and meetings, $15,946; travel and
entertainment, $18,077; general and administrative, $42,204;
telephone, $2,388; and occupancy and equipment rental,
$5,906.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy Latin America Strategy Fund:
advertising, $257; printing and mailing of prospectuses
to persons other than current shareholders, $19,032;
compensation to dealers, $2,606; compensation to sales
personnel,$1,649; seminars and meetings, $650; travel
and entertainment, $410; general and administrative,
$970; telephone, $55; and occupancy and equipment rental, $133.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy Latin America Strategy Fund:
advertising, $94; printing and mailing of prospectuses
to persons other than current shareholders, $6,920;
compensation to dealers, $947; compensation to sales
personnel,$600; seminars and meetings, $237; travel and
entertainment, $149; general and administrative, $353; telephone,
$20; and occupancy and equipment rental, $49.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
A shares of Ivy New Century Fund: advertising, $393;
printing and mailing of prospectuses to persons other
than current shareholders, $15,252; compensation to
dealers, $4,008; compensation to sales
personnel,$2,560; seminars and meetings, $1,002; travel and
entertainment, $637; general and administrative, $1,486;
telephone, $85; and occupancy and equipment rental, $208.

During the fiscal year ended December 31, 1995,
IMDI expended the following amounts in marketing Class
B shares of Ivy New Century Fund: advertising, $105;
printing and mailing of

prospectuses to persons other than current
shareholders, $4,083; compensation to dealers, $1,073;
compensation to sales personnel,$685; seminars and
meetings, $268; travel and entertainment, $170; general
and administrative, $398; telephone, $23; and occupancy
and equipment rental, $56.

Since the inception date for Class C shares of
each Fund is April 30, 1996, no payments were made in
marketing Class C shares of any Fund during the
relevant time period. Further, no payments were made
with respect to Ivy Global Science & Technology Fund,
which commenced operations on July 22, 1996, or Ivy
Asia Pacific Fund, Ivy Global Natural Resources Fund and Ivy
International Small Companies Fund, which commenced
operations on January 1, 1997.

Each Plan may be amended at any time with respect
to the class of shares of the Fund to which the Plan
relates by vote of the Trustees, including a majority
of the Independent Trustees, cast in person at a
meeting called for the purpose of considering such
amendment. Each Plan may be terminated at any time with
respect to the class of shares of the particular Fund to which
the Plan relates, without payment of any penalty, by vote
of a majority of the Independent Trustees, or by vote
of a majority of the outstanding voting securities of
that class.

If the Distribution Agreement or the Distribution
Plans are terminated (or not renewed) with respect to
any of the Ivy Mackenzie Funds (or class of shares
thereof), each may continue in effect with respect to
any other fund (or Class of shares thereof) as to which
they have not been terminated (or have been
renewed).

CUSTODIAN

Pursuant to a Custodian Agreement with the Trust,
Brown Brothers Harriman & Co. (the "Custodian"), a
private bank and member of the principal securities
exchanges, located at 40 Water Street, Boston,
Massachusetts 02109, maintains custody of the assets of
each Fund held in the United States. Under the
Custodian Agreement, Brown Brothers also provides certain
financial services for Ivy International Fund, including
bookkeeping, computation of daily net asset value, maintenance
of income, expense and brokerage records, and provision
of all information required by the Trust in order to
satisfy its reporting and filing requirements. Rules
adopted under the 1940 Act permit the Trust to maintain
its foreign securities (Canadian securities, with
respect to Ivy Canada Fund and Ivy Global Natural
Resources Fund) and cash in the custody of certain
eligible foreign banks and securities depositories (and certain
eligible Canadian banks and securities depositories, with
respect to Ivy Canada Fund and Ivy Global Natural
Resources Fund). Pursuant to those rules, Brown
Brothers has entered into subcustodial agreements for
the holding of each Fund's foreign securities (and for
the holding of Ivy Canada Fund's and Ivy

Global Natural Resources Fund's non-Canadian foreign
securities). Similarly, pursuant to those rules, Ivy
Canada Fund's and Ivy Global Natural Resources Fund's
portfolio securities and cash, when invested in
Canadian securities, will be held by its Sub- custodian,
The Bank of Nova Scotia. With respect to each Fund,
except for Ivy Canada Fund and Ivy Global Natural Resources Fund,
Brown Brothers may receive, as partial payment for its
services, a portion of the Trust's brokerage business,
subject to its ability to provide best price and
execution.

FUND ACCOUNTING SERVICES

Pursuant to a Fund Accounting Services Agreement,
MIMI provides certain accounting and pricing services
for the Funds. As compensation for those services,
each Fund pays MIMI a monthly fee plus out-of-pocket
expenses as incurred. The monthly fee is based upon
the net assets of a Fund at the preceding month end at
the following rates: $1,250 when net assets are $10 million and
under; $2,500 when net assets are over $10 million to $40
million; $5,000 when net assets are over $40 million to
$75 million; and $6,500 when net assets are over $75
million.

For the fiscal years ended June 30, 1993 and 1994,
for the six-month period ended December 31, 1994 and
for the fiscal year ended December 31, 1995, Ivy Canada
Fund paid MIMI $32,742, $32,492, $16,442 and $32,399,
respectively, under the agreement.. During the period
from October 23, 1993 (commencement of operations) to
December 31, 1993 and during the fiscal years ended
December 31, 1994 and 1995, Ivy China Region Fund paid MIMI
$2,513, $32,137 and $32,653, respectively, under the
agreement. For the fiscal years ended June 30, 1993
and 1994, for the six- month period ended December 31,
1994 and for the fiscal year ended December 31, 1995,
Ivy Global Fund paid MIMI $25,612 and $31,448, $15,957
and $32,982, respectively, under the agreement. The
payments to MIMI from Ivy International Fund amounted to
$48,788 for the nine months ended December 31, 1994. Prior to
April 1, 1994, the Fund utilized an unrelated entity for
fund accounting and pricing services. Such fees and
expenses for the fiscal year ended December 31, 1994
totalled $88,790. For the fiscal year ended December
31, 1995, Ivy International Fund paid MIMI $91,612
under the agreement. During the period from November
1, 1994 (commencement of operations) to December 31,
1994 and during the fiscal year ended December 31, 1995, Ivy
Latin America Strategy Fund paid MIMI $2,505 and $15,094,
respectively, under the agreement. During the period from
November 1, 1994 (commencement of operations) to December
31, 1994 and during the fiscal year ended December 31,
1995, Ivy New Century Fund paid MIMI $2,505 and
$15,112, respectively, under the agreement.

No payments were made by Ivy Global Science &
Technology Fund, which commenced operations on July 22,
1996, or Ivy Asia Pacific Fund, Ivy Global Natural
Resources Fund and Ivy

International Small Companies Fund, which commenced
operations on January 1, 1997.

TRANSFER AGENT AND DIVIDEND PAYING AGENT

Pursuant to a Transfer Agency and Shareholder
Service Agreement, IMSC, a wholly owned subsidiary of
MIMI, is the transfer agent for each Fund. Each Fund
(except for the Class I Funds with respect to their
Class I shares) pays a monthly fee at an annual rate of
$20.00 for each open Class A, Class B and Class C
account. The Class I Funds pay $10.25 per open Class I
account. In addition, each Fund pays a monthly fee at an annual
rate of $4.48 per account that is closed plus certain
out-of- pocket expenses. Such fees and expenses for the
fiscal year ended December 31, 1995 for Ivy Canada
Fund, Ivy China Region Fund, Ivy Global Fund, Ivy
International Fund, Ivy Latin America Strategy Fund and
Ivy New Century Fund totalled $181,036, $113,884,
$88,419, $590,068, $7,376 and $7,918, respectively. No
payments were made by Ivy Global Science & Technology Fund, which
commenced operations on July 22, 1996, or Ivy Asia
Pacific Fund, Ivy Global Natural Resources Fund and Ivy
International Small Companies Fund, which commenced
operations on January 1, 1997. Certain broker-dealers
that maintain shareholder accounts with a Fund through
an omnibus account provide transfer agent and other
shareholder-related services that would otherwise be provided by
IMSC if the individual accounts that comprise the omnibus
account were opened by their beneficial owners
directly. IMSC pays such broker-dealers a per account
fee for each open account within the omnibus account,
or a fixed rate (e.g., .10%) fee, based on the average
daily net asset value of the omnibus account (or a
combination thereof).

ADMINISTRATOR

Pursuant to an Administrative Services Agreement,
MIMI provides certain administrative services to each
Fund. As compensation for these services, each Fund
(except for the Class I Funds with respect to their
Class I shares) pays MIMI a monthly fee at the annual
rate of .10% of that Fund's average daily net assets.
The Class I Funds pay MIMI a monthly fee at the annual
rate of .01% of its average daily net assets for Class I. Such
fees for the fiscal year ended December 31, 1995 for Ivy
Canada Fund, Ivy China Region Fund, Ivy Global Fund,
Ivy International Fund, Ivy Latin America Strategy Fund
and Ivy New Century Fund totalled $19,208, $20,061,
$23,996, $387,795, $1,434 and $1,971, respectively.
As of December 31, 1995, none of Ivy Asia Pacific Fund,
Ivy Global Natural Resources Fund, Ivy Global Science &
Technology Fund or Ivy International Small Companies Fund had
commenced operations.

Outside of providing administrative services to
the Trust, as described above, MIMI may also act on
behalf of IMDI in paying commissions to broker-dealers
with respect to sales of Class B and Class C shares of
each Fund.

AUDITORS

Coopers & Lybrand L.L.P., independent certified
public accountants, 200 East Las Olas Boulevard, Suite
1700, Ft. Lauderdale, Florida 33301, has been selected
as auditors for the Trust. The audit services
performed by Coopers & Lybrand L.L.P., include audits
of the annual financial statements of each of the funds
of the Trust. Other services provided principally relate
to filings with the SEC and the preparation of the Fund's tax
returns.

CAPITALIZATION AND VOTING RIGHTS

Ivy Canada Fund results from a reorganization of
Mackenzie Canada Fund, a series of the Company, which
reorganization was approved by shareholders on January
27, 1995. Ivy Global Fund results from a
reorganization of Mackenzie Global Fund, which
reorganization was approved by shareholders on January 27, 1995.
The capitalization of the Trust consists of an unlimited
number of shares of beneficial interest (no par value
per share). When issued, shares of each class of each
Fund are fully paid, non- assessable, redeemable and
fully transferable. No class of shares of a Fund has
preemptive rights or subscription rights.

The Amended and Restated Declaration of Trust
permits the Trustees to create separate series or
portfolios and to divide any series or portfolio into
one or more classes. The Trustees have authorized
sixteen series, each of which represents a fund. The
Trustees have further authorized the issuance of Classes A, B
and C for Ivy Asia Pacific Fund, Ivy Bond Fund, Ivy Canada
Fund, Ivy China Region Fund, Ivy Emerging Growth Fund,
Ivy Global Fund, Ivy Global Natural Resources Fund, Ivy
Global Science & Technology Fund, Ivy Growth Fund, Ivy
Growth with Income Fund, Ivy International Fund, Ivy
International Bond Fund, Ivy Latin America Strategy
Fund, Ivy Money Market Fund and Ivy New Century Fund,
as well as Class I for Ivy Bond Fund, Ivy Global Science &
Technology Fund, Ivy International Fund and Ivy International
Small Companies Fund, and Class D for Ivy Growth with
Income Fund. [FN][The Class D shares of Ivy Growth with
Income Fund were initially issued as "Ivy Growth with
Income Fund -- Class C" to shareholders of Mackenzie
Growth & Income Fund, a former series of the Company,
in connection with the reorganization between that fund
and Ivy Growth with Income Fund and not offered for
sale to the public. On February 29, 1996, the Trustees of the
Trust resolved by written consent to establish a new class
of shares designated as "Class C" for all Ivy Fund
portfolios and to redesignate the shares of beneficial
interest of "Ivy Growth with Income Fund--Class C" as
shares of beneficial interest of "Ivy Growth with
Income Fund--Class D," which establishment and
redesignation, respectively, became effective on April 30, 1996.
The voting, dividend, liquidation and other rights,
preferences, powers, restrictions, limitations,
qualifications, terms and conditions of the Class D
shares of Ivy Growth with Income Fund,

as set forth in Ivy Fund's Declaration of Trust, as
amended from time to time, will not be changed by this
redesignation.]

Shareholders have the right to vote for the
election of Trustees of the Trust and on any and all
matters on which they may be entitled to vote by law or
by the provisions of the Trust's By-Laws. The Trust is
not required to hold a regular annual meeting of
shareholders, and it does not intend to do so. Shares
of each class of each Fund entitle their holders to one
vote per share (with proportionate voting for fractional shares).
Shareholders of a Fund are entitled to vote alone on
matters that only affect that Fund. All classes of
shares of a Fund will vote together, except with
respect to the distribution plan applicable to that
Fund's Class A, Class B or Class C shares or when a class
vote is required by the 1940 Act. On matters relating to all
funds of the Trust, but affecting the funds differently,
separate votes by the shareholders of each fund are
required. Approval of an investment advisory agreement
and a change in fundamental policies would be regarded
as matters requiring separate voting by the
shareholders of each fund of the Trust. If the Trustees
determine that a matter does not affect the interests of a Fund,
then the shareholders of that Fund will not be entitled
to vote on that matter. Matters that affect the Trust
in general, such as ratification of the selection of
independent public accountants, will be voted upon
collectively by the shareholders of all funds of the
Trust.

As used in this SAI and the Prospectus, the phrase
"majority vote of the outstanding shares" of a Fund
means the vote of the lesser of: (1) 67% of the shares
of that Fund (or of the Trust) present at a meeting if
the holders of more than 50% of the outstanding shares
are present in person or by proxy; or (2) more than 50%
of the outstanding shares of that Fund (or of the
Trust).

With respect to the submission to shareholder vote
of a matter requiring separate voting by a Fund, the
matter shall have been effectively acted upon with
respect to that Fund if a majority of the outstanding
voting securities of that Fund votes for the approval
of the matter, notwithstanding that: (1) the matter
has not been approved by a majority of the outstanding
voting securities of any other fund of the Trust; or (2) the
matter has not been approved by a majority of the outstanding
voting securities of the Trust.

The Amended and Restated Declaration of Trust
provides that the holders of not less than two-thirds
of the outstanding shares of the Trust may remove a
person serving as trustee either by declaration in
writing or at a meeting called for such purpose. The
Trustees are required to call a meeting for the purpose of
considering the removal of a person serving as Trustee if
requested in writing to do so by the holders of not less than
10% of the outstanding shares of the Trust.
Shareholders will be assisted in communicating with
other shareholders in connection

with the removal of a Trustee as if Section 26(c) of
the Act were applicable.

The Trust's shares do not have cumulative voting
rights and accordingly the holders of more than 50% of
the outstanding shares could elect the entire Board, in
which case the holders of the remaining shares would
not be able to elect any Trustees.

To the knowledge of the Trust, as of November 29,
1996, no shareholder owned beneficially or of record 5%
of more of any Fund's outstanding Class A shares,
except that of the outstanding Class shares of Ivy
Global Science & Technology Fund, Donaldson Lufkin &
Jenrette Securities Corp., PO Box 2052, Jersey City, NJ
07303-9998 owned of record 148,416.494 shares (34.01%); and
except that of the outstanding Class A shares of Ivy
International Fund, Charles Schwab & Co., Inc., 101 Montgomery
Street, San Francisco, California 94101 owned of record
10,054,412.074 shares (39.62%); and except that of the
outstanding Class A shares of Ivy Latin America Strategy Fund,
Donaldson Lufkin & Jenrette Securities Corp., PO Box
2052, Jersey City, NJ 07303-9998, owned of record
87,577.721 shares (18.08%), and Merrill Lynch Pierce
Fenner & Smith, 4800 Deer Lake Drive East, 3rd Floor,
Jacksonville, FL 32246, owned of record 53,494.000
shares (11.04%).

To the knowledge of the Trust, as of November 29,
1996, no shareholder owned beneficially or of record 5%
or more of any Fund's outstanding Class B shares,
except that of the outstanding Class B shares of Ivy
Canada Fund, Merrill Lynch Pierce Fenner & Smith, 4800
Deer Lake Drive East, 3rd Floor, Jacksonville, FL
32246, owned of record 33,556.000 shares (17.16%) and JW Charles
Clearing Corp Cust., FBO Joseph Zerger IRA c/o Zarlene
Imports, 1550 E Oakland Blvd., Ft. Lauderdale, FL
33334-4425, owned of record 13,565.891 shares (6.93%);
and except that of the outstanding Class B shares of
Ivy China Region Fund, Merrill Lynch Pierce Fenner &
Smith, 4800 Deer Lake Drive East, 3rd Floor
Jacksonville, FL 32246, owned of record 63,280.000 shares
(7.13%); and except that of the outstanding Class B shares of
Ivy International Fund, Merrill Lynch Pierce Fenner &
Smith, 4800 Deer Lake Drive East, 3rd Floor,
Jacksonville, FL 32246, owned of record 2,992,569.000
shares (38.13%); and except that of the outstanding
Class B shares of Ivy Latin America Strategy Fund,
Merrill Lynch Pierce Fenner & Smith, 4800 Deer Lake Drive East,
3rd Floor, Jacksonville, FL 32246, owned of record
85,034.000 shares (36.99%), and Donaldson Lufkin
Jenrette Securities Corporation Inc., P. O. Box 2052,
Jersey City, New Jersey 07303, owned of record
13,632.449 shares (5.93%); and except that of the
outstanding Class B shares of Ivy New Century Fund, Merrill Lynch
Pierce Fenner & Smith, 4800 Deer Lake Drive East, 3rd
Floor, Jacksonville, FL 32246, owned of record
142,676.000 shares (23.95%).

To the knowledge of the Trust, as of November 29,
1996, no shareholder owned beneficially or of record 5%
or more of any

Fund's outstanding Class C shares, except that of the
outstanding Class C shares of Ivy Canada Fund, Merrill
Lynch Pierce Fenner & Smith, 4800 Deer Lake Drive East,
3rd Floor, Jacksonville, FL 32246, owned of record
9,843.000 shares (21.77%), Wedbush Morgan Securities,
A/C 6998-0206, 1000 Wilshire Blvd., Los Angeles, CA
90292, owned of record 6,012.000 shares (13.29%), Alma R Buncsak,
N6975 Rocklake Road #8, Lake Mills, WI 53551, owned of
record 2,625.612 shares (5.80%), and Wedbush Morgan
Securities, A/C 2215-9922, 1000 Wilshire Blvd., Los
Angeles, CA 90292, owned of record 2,608.000 shares
(5.76%); and except that of the outstanding Class C
shares of Ivy China Region Fund, The Ohio Company c/o
Mansbach Metal, 155 E Broad Street, Columbus, OH 43115,
owned of record 26,567.481 shares (66.37%), and Merrill
Lynch Pierce Fenner & Smith, 4800 Deer Lake Drive East, 3rd
Floor, Jacksonville, FL 32246, owned of record 2,037.000
shares (5.05%); and except that of the outstanding
shares of Ivy Global Fund, Prudential Securities Inc.
FBO the 1994 Schulz Trust, Villa Park, CA 92667-4533,
owned of record 733.000 shares (45.31%), Linda Moorash,
414B Black Hawk Lane, Stratford, CT 06497, owned of
record 598.541 shares (37.00%), and Merrill Lynch Pierce
Fenner & Smith, 4800 Deer Lake Drive East, 3rd Floor,
Jacksonville, FL 32246, owned of record 286.000 shares (17.68%);
and except that of the outstanding Class C shares of Ivy
International Fund, Merrill Lynch Pierce Fenner & Smith,
4800 Deer Lake Drive East, 3rd Floor, Jacksonville, FL
32246, owned of record 633,898.000 shares (65.07%); and
except that of the outstanding Class C shares of Ivy
Latin America Strategy Fund, Merrill Lynch Pierce
Fenner & Smith, 4800 Deer Lake Drive East, 3rd Floor,
Jacksonville, FL 32246, owned of record 9,731.000
shares (99.99%); and except that of the outstanding Class shares
of Ivy New Century Fund, Merrill Lynch Pierce Fenner &
Smith, 4800 Deer Lake Drive East, 3rd Floor,
Jacksonville, FL 32246, owned of record 38,170.000
shares (26.38%).

To the knowledge of the Trust, as of November 29,
1996, no shareholder owned beneficially or of record 5%
or more of any Fund's outstanding Class I shares,
except that of the outstanding Class I shares of Ivy
International Fund, The John E. Fetzer Institute Inc.,
9292 W KL Ave., Kalamazoo, MI 49009, owned of record
435,287.290 shares (30.25%), Vernat Company, P. O. Box
800, Brattleboro, VT 05302, owned of record 208,798.292 shares
(14.51%), S. Mark Taper Foundation, 12011 San Vicente
Blvd. Suite 400, Los Angeles, CA 90049, owned of
record 149,387.511 shares (10.38%), Wendel & Co., c/o
Bank of New York, PO Box 1066 Wall Street Station, New
York, NY 10268, owned of record 132,331.674 shares
(9.19%), and Samuel Miller TTEE of the Liz Claiborne PSP,
One Claiborne Ave., N. Bergen NJ 07047, owned of record
88,836.245 shares (6.17%).

Under Massachusetts law, the Trust's shareholders
could, under certain circumstances, be held personally
liable for the obligations of the Trust. However, the
Amended and Restated Declaration of Trust disclaims
liability of the shareholders, Trustees or officers of
the Trust for acts or obligations of the

Trust, which are binding only on the assets and
property of the Trust, and requires that notice of the
disclaimer be given in each contract or obligation
entered into or executed by the Trust or its Trustees.
The Amended and Restated Declaration of Trust provides
for indemnification out of Fund property for all loss
and expense of any shareholder of a Fund held personally liable
for the obligations of that Fund. The risk of a
shareholder of the Trust incurring financial loss on
account of shareholder liability is limited to
circumstances in which the Trust itself would be unable
to meet its obligations and, thus, should be considered
remote. No series of the Trust is liable for the
obligations of any other series of the Trust. However, because
the Prospectus pertains to more than one Fund, it is
possible that one of the Funds to which the Prospectus
pertains might become liable for any misstatement,
inaccuracy, or incomplete disclosure in the Prospectus
concerning any other Fund to which the Prospectus
pertains.

NET ASSET VALUE

The share price, or value, for the separate
Classes of shares of a Fund is called the net asset
value per share. The net asset value per share of a
Fund is computed by dividing the value of the assets of
that Fund, less its liabilities, by the number of
shares of the particular Fund outstanding. For
purposes of determining the aggregate net assets of a Fund, cash
and receivables will be valued at their realizable
amounts. A security listed or traded on a recognized
stock exchange or NASDAQ is valued at its last sale
price on the principal exchange on which the security
is traded. The value of a foreign security is
determined in its national currency as of the normal close of
trading on the foreign exchange on which it is traded or as
of the close of regular trading on the Exchange, if
that is earlier, and that value is then converted into
its U.S. dollar equivalent at the foreign exchange rate
in effect at noon, Eastern time, on the day the value
of the foreign security is determined. If no sale is
reported at that time, the average between the current
bid and asked price is used. All other securities for which OTC
market quotations are readily available are valued at the
average between the current bid and asked price.
Interest will be recorded as accrued. Securities and
other assets for which market prices are not readily
available are valued at fair value as determined by IMI
and approved in good faith by the Board. Money market
instruments of the Fund are valued at amortized cost,
which approximates money market value.

A Fund's liabilities are allocated between its
Classes. The total of such liabilities allocated to a
Class plus that Class's distribution fee and any other
expenses specially allocated to that Class are then
deducted from the Class's proportionate interest in
that Fund's assets, and the resulting amount for each
Class is divided by the number of shares of that Class
outstanding to produce the net asset value per share.

Portfolio securities are valued and net asset
value per share is determined as of the close of
regular trading on the Exchange (normally 4:00 p.m.,
eastern time), every Monday through Friday (exclusive
of national business holidays). The Trust's offices
will be closed, and net asset value will not be
calculated, on the following national business holidays: New
Year's Day, President's Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas
Day. On those days when either or both of the Funds'
Custodian or the Exchange close early as a result of
such day being a partial holiday or otherwise, the
Trust reserves the right to advance the time on that
day by which purchase and redemption requests must be
received.

When a Fund writes an option, an amount equal to
the premium received by that Fund is included in that
Fund's Statement of Assets and Liabilities as an asset
and as an equivalent liability. The amount of the
liability will be subsequently marked-to-market daily
to reflect the current market value of the option
written. The current market value of a written option is
the last sale on the principal exchange on which such option is
traded or, in the absence of a sale, the last offering
price.

The premium paid by a Fund for the purchase of a
call or a put option will be deducted from its assets
and an equal amount will be included in the asset
section of that Fund's Statement of Assets and
Liabilities as an investment and subsequently adjusted
to the current market value of the option. For example, if the
current market value of the option exceeds the premium
paid, the excess would be unrealized appreciation and,
conversely, if the premium exceeds the current market
value, such excess would be unrealized depreciation.
The current market value of a purchased option will be
the last sale price on the principal exchange on which
the option is traded or, in the absence of a sale, the last
bid price. If a Fund exercises a call option which it has
purchased, the cost of the security which that Fund
purchased upon exercise will be increased by the
premium originally paid.

The sale of shares of a Fund will be suspended
during any period when the determination of its net
asset value is suspended pursuant to rules or orders of
the SEC and may be suspended by the Board whenever in
its judgment it is in the best interest of the
particular Fund to do so.

PORTFOLIO TURNOVER

Each Fund purchases securities that are believed
by IMI to have above average potential for capital
appreciation. Common stocks are disposed of in
situations where it is believed that potential for such
appreciation has lessened or that other common stocks
have a greater potential. Therefore, a Fund may purchase
and sell securities without regard to the length of time the
security is to be, or has been, held. A change in
securities held by a Fund is known as "portfolio
turnover" and may involve

the payment by that Fund of dealer markup or
underwriting commission and other transaction costs on
the sale of securities, as well as on the reinvestment
of the proceeds in other securities. A Fund's
portfolio turnover rate is calculated by dividing the
lesser of purchases or sales of portfolio securities
for the most recently completed fiscal year by the monthly
average of the value of the portfolio securities owned by the
Fund during that year. For purposes of determining a
Fund's portfolio turnover rate, all securities whose
maturities at the time of acquisition were one year or
less are excluded. The annual portfolio turnover rates
for the Funds are provided in the Prospectus under "The
Funds' Financial Highlights."

REDEMPTIONS

Shares of each Fund are redeemed at their net
asset value next determined after a proper redemption
request has been received by IMSC, less any applicable
CDSC.

Unless a shareholder requests that the proceeds of
any redemption be wired to his or her bank account,
payment for shares tendered for redemption is made by
check within seven days after tender in proper form,
except that the Trust reserves the right to suspend the
right of redemption or to postpone the date of payment
upon redemption beyond seven days, (i) for any period
during which the Exchange is closed (other than customary weekend
and holiday closings) or during which trading on the
Exchange is restricted, (ii) for any period during
which an emergency exists as determined by the SEC as a
result of which disposal of securities owned by a Fund
is not reasonably practicable or it is not reasonably
practicable for the Fund to fairly determine the value
of its net assets, or (iii) for such other periods as the
SEC may by order permit for the protection of shareholders of a
Fund.

Under unusual circumstances, when the Board deems
it in the best interest of a Fund's shareholders, the
Fund may make payment for shares repurchased or
redeemed in whole or in part in securities of that Fund
taken at current values. If any such redemption in
kind is to be made, each Fund intends to make an
election pursuant to Rule 18f-1 under the 1940 Act. This will
require the particular Fund to redeem with cash at a
shareholder's election in any case where the redemption
involves less than $250,000 (or 1% of that Fund's net
asset value at the beginning of each 90-day period
during which such redemptions are in effect, if that
amount is less than $250,000). Should payment be made
in securities, the redeeming shareholder may incur
brokerage costs in converting such securities to cash.

Subject to state law restrictions, the Trust may
redeem those accounts of shareholders who have
maintained an investment, including sales charges paid,
of less than $1,000 in a Fund for a period of more than
12 months. All accounts below that minimum will be
redeemed simultaneously when MIMI deems it advisable.

The $1,000 balance will be determined by actual dollar
amounts invested by the shareholder, unaffected by
market fluctuations. The Trust will notify any such
shareholder by certified mail of its intention to
redeem such account, and the shareholder shall have 60
days from the date of such letter to invest such
additional sums as shall raise the value of such account above
that minimum. Should the shareholder fail to forward such
sum within 60 days of the date of the Trust's letter of
notification, the Trust will redeem the shares held in
such account and transmit the redemption in value
thereof to the shareholder. However, those
shareholders who are investing pursuant to the
Automatic Investment Method will not be redeemed automatically
unless they have ceased making payments pursuant to the
plan for a period of at least six consecutive months,
and these shareholders will be given six-months' notice
by the Trust before such redemption. Shareholders in a
qualified retirement, pension or profit sharing plan
who wish to avoid tax consequences must "rollover" any
sum so redeemed into another qualified plan within 60
days. The Trustees of the Trust may change the minimum
account size.

If a shareholder has given authorization for
telephonic redemption privilege, shares can be redeemed
and proceeds sent by Federal wire to a single
previously designated bank account. Delivery of the
proceeds of a wire redemption request of $250,000 or
more may be delayed by a Fund for up to seven days if deemed
appropriate under then-current market conditions. The Trust
reserves the right to change this minimum or to terminate
the telephonic redemption privilege without prior
notice. The Trust cannot be responsible for the
efficiency of the Federal wire system of the
shareholder's dealer of record or bank. The
shareholder is responsible for any charges by the shareholder's
bank.

Each Fund employs reasonable procedures that
require personal identification prior to acting on
redemption or exchange instructions communicated by
telephone to confirm that such instructions are
genuine. In the absence of such instructions, a Fund
may be liable for any losses due to unauthorized or
fraudulent telephone instructions.

CONVERSION OF CLASS B SHARES

As described in the Prospectus, Class B shares of
each Fund will automatically convert to Class A shares
of the respective Fund, based on the relative net asset
values per share of the two classes, no later than the
month following the eighth anniversary of the initial
issuance of such Class B shares of the particular Fund
occurs. For the purpose of calculating the holding period
required for conversion of Class B shares, the date of initial
issuance shall mean: (1) the date on which such Class B
shares were issued, or (2) for Class B shares obtained
through an exchange, or a series of exchanges, (subject
to the exchange privileges for Class B shares) the date
on which the original

Class B shares were issued. For purposes of conversion
of Class B shares, Class B shares purchased through the
reinvestment of dividends and capital gain
distributions paid in respect of Class B shares will be
held in a separate sub-account. Each time any Class B
shares in the shareholder's regular account (other than
those shares in the sub-account) convert to Class A shares,
a pro rata portion of the Class B shares in the sub-account
will also convert to Class A shares. The portion will
be determined by the ratio that the shareholder's Class
B shares converting to Class A shares bears to the
shareholder's total Class B shares not acquired through
the reinvestment of dividends and capital gain
distributions.

TAXATION

The following is a general discussion of certain
tax rules thought to be applicable with respect to the
Funds. It is merely a summary and is not an exhaustive
discussion of all possible situations or of all
potentially applicable taxes. Accordingly,
shareholders and prospective shareholders should consult a
competent tax advisor about the tax consequences to them of
investing in the Funds.

Each Fund intends to be taxed as a regulated
investment company under Subchapter M of the Code.
Accordingly, each Fund must, among other things, (a)
derive in each taxable year at least 90% of its gross
income from dividends, interest, payments with respect
to certain securities loans, and gains from the sale or
other disposition of stock, securities or foreign currencies,
or other income derived with respect to its business of
investing in such stock, securities or currencies; (b)
derive in each taxable year less than 30% of its gross
income from the sale or other disposition of certain
assets held less than three months, namely: (i) stock
or securities; (ii) options, futures, or forward
contracts (other than those on foreign currencies); or
(iii) foreign currencies (or options, futures, or forward
contracts on foreign currencies) that are not directly related
to the particular Fund's principal business of
investing in stock or securities (or options and
futures with respect to stock or securities) (the "30%
Limitation"); and (c) diversify its holdings so that,
at the end of each fiscal quarter, (i) at least 50% of
the market value of the particular Fund's assets is
represented by cash, U.S. Government securities, the securities
of other regulated investment companies and other
securities, with such other securities limited, in
respect of any one issuer, to an amount not greater
than 5% of the value of the particular Fund's total
assets and 10% of the outstanding voting securities of
such issuer, and (ii) not more than 25% of the value of its
total assets is invested in the securities of any one issuer
(other than U.S. Government securities and the securities
of other regulated investment companies).

As a regulated investment company, each Fund
generally will not be subject to U.S. Federal income
tax on its income and gains

that it distributes to shareholders, if at least 90% of
its investment company taxable income (which includes,
among other items, dividends, interest and the excess
of any short-term capital gains over long-term capital
losses) for the taxable year is distributed. Each Fund
intends to distribute all such income.

Amounts not distributed on a timely basis in
accordance with a calendar year distribution
requirement are subject to a nondeductible 4% excise
tax at the Fund level. To avoid the tax, each Fund
must distribute during each calendar year, (1) at least
98% of its ordinary income (not taking into account any capital
gains or losses) for the calendar year, (2) at least 98%
of its capital gains in excess of its capital losses
(adjusted for certain ordinary losses) for a one-year
period generally ending on October 31 of the calendar
year, and (3) all ordinary income and capital gains for
previous years that were not distributed during such
years. To avoid application of the excise tax, each
Fund intends to make distributions in accordance with the
calendar year distribution requirements. A distribution will be
treated as paid on December 31 of the current calendar
year if it is declared by the particular Fund in
October, November or December of the year with a record
date in such a month and paid by that Fund during
January of the following year. Such distributions will
be taxable to shareholders in the calendar year the
distributions are declared, rather than the calendar
year in which the distributions are received.

OPTIONS, FUTURES AND FOREIGN CURRENCY FORWARD CONTRACTS

The taxation of equity options and OTC options on
debt securities is governed by Code section 1234.
Pursuant to Code section 1234, the premium received by
a Fund for selling a put or call option is not included
in income at the time of receipt. If the option
expires, the premium is short-term capital gain to the
Fund. If the Fund enters into a closing transaction, the
difference between the amount paid to close out its position and
the premium received is short-term capital gain or loss.
If a call option written by a Fund is exercised,
thereby requiring the Fund to sell the underlying
security, the premium will increase the amount realized
upon the sale of such security and any resulting gain
or loss will be a capital gain or loss, and will be
long-term or short-term depending upon the holding period of
the security. With respect to a put or call option that is
purchased by a Fund, if the option is sold, any resulting
gain or loss will be a capital gain or loss, and will
be long-term or short-term, depending upon the holding
period of the option. If the option expires, the
resulting loss is a capital loss and is long-term or
short-term, depending upon the holding period of the
option. If the option is exercised, the cost of the option, in
the case of a call option, is added to the basis of the
purchased security and, in the case of a put option,
reduces the amount realized on the underlying security
in determining gain or loss.

Some of the options, futures and foreign currency
forward contracts in which a Fund may invest may be
"section 1256 contracts." Gains (or losses) on these
contracts generally are considered to be 60% long-term
and 40% short-term capital gains or losses; however
foreign currency gains or losses arising from certain
section 1256 contracts are ordinary in character. Also,
section 1256 contracts held by a Fund at the end of each taxable
year (and on certain other dates prescribed in the Code)
are "marked-to-market" with the result that unrealized
gains or losses are treated as though they were
realized.

The transactions in options, futures and forward
contracts undertaken by a Fund may result in
"straddles" for Federal income tax purposes. The
straddle rules may affect the character of gains or
losses realized by a Fund. In addition, losses realized
by a Fund on positions that are part of a straddle may be
deferred under the straddle rules, rather than being taken into
account in calculating the taxable income for the taxable
year in which such losses are realized. Because only a
few regulations implementing the straddle rules have
been promulgated, the consequences of such transactions
to a Fund are not entirely clear. The straddle rules
may increase the amount of short-term capital gain
realized by a Fund, which is taxed as ordinary income
when distributed to shareholders.

A Fund may make one or more of the elections
available under the Code which are applicable to
straddles. If a Fund makes any of the elections, the
amount, character and timing of the recognition of
gains or losses from the affected straddle positions
will be determined under rules that vary according to
the election(s) made. The rules applicable under certain of the
elections may operate to accelerate the recognition of
gains or losses from the affected straddle positions.

Because application of the straddle rules may
affect the character of gains or losses, defer losses
and/or accelerate the recognition of gains or losses
from the affected straddle positions, the amount which
must be distributed to shareholders as ordinary income
or long-term capital gain, may be increased or
decreased substantially as compared to a fund that did not engage
in such transactions.

The 30% Limitation and the diversification
requirements applicable to a Fund's assets may limit
the extent to which a Fund will be able to engage in
transactions in options, futures and forward contracts.

CURRENCY FLUCTUATIONS -- "SECTION 988" GAINS OR LOSSES

Gains or losses attributable to fluctuations in
exchange rates which occur between the time a Fund
accrues receivables or liabilities denominated in a
foreign currency and the time the Fund actually
collects such receivables or pays such liabilities
generally are treated as ordinary income or ordinary loss.

Similarly, on disposition of some investments,
including debt securities denominated in a foreign
currency and certain options, futures and forward
contracts, gains or losses attributable to fluctuations
in the value of the foreign currency between the date
of acquisition of the security or contract and the date of
disposition also are treated as ordinary gain or loss. These
gains and losses, referred to under the Code as "section
988" gains or losses, increase or decrease the amount
of a Fund's investment company taxable income available
to be distributed to its shareholders as ordinary
income. If section 988 losses exceed other investment
company taxable income during a taxable year, a Fund
would not be able to make any ordinary dividend
distributions, or distributions made before the losses were
realized would be recharacterized as a return of capital to
shareholders, rather than as an ordinary dividend, reducing
each shareholder's basis in his or her Fund shares.

INVESTMENT IN PASSIVE FOREIGN INVESTMENT COMPANIES

A Fund may invest in shares of foreign
corporations which may be classified under the Code as
passive foreign investment companies ("PFICs"). In
general, a foreign corporation is classified as a PFIC
if at least one-half of its assets constitute
investment-type assets, or 75% or more of its gross
income is investment-type income. If a Fund receives a so-called
"excess distribution" with respect to PFIC stock, a Fund
itself may be subject to a tax on a portion of the
excess distribution, whether or not the corresponding
income is distributed by a Fund to shareholders. In
general, under the PFIC rules, an excess distribution
is treated as having been realized ratably over the
period during which a Fund held the PFIC shares. A Fund itself
will be subject to tax on the portion, if any, of an
excess distribution that is so allocated to prior Fund
taxable years and an interest factor will be added to
the tax, as if the tax had been payable in such prior
taxable years. Certain distributions from a PFIC as
well as gain from the sale of PFIC shares are treated
as excess distributions. Excess distributions are
characterized as ordinary income even though, absent application
of the PFIC rules, certain excess distributions might
have been classified as capital gain.

A Fund may be eligible to elect alternative tax
treatment with respect to PFIC shares. Under an
election that currently is available in some
circumstances, a Fund generally would be required to
include in its gross income its share of the earnings
of a PFIC on a current basis, regardless of whether distributions
are received from the PFIC in a given year. If this
election were made, the special rules, discussed above,
relating to the taxation of excess distributions, would
not apply. In addition, other elections may become
available that would affect the tax treatment of PFIC
shares held by a Fund.

DEBT SECURITIES ACQUIRED AT A DISCOUNT

Some of the debt securities (with a fixed maturity
date of more than one year from the date of issuance)
that may be acquired by a Fund may be treated as debt
securities that are issued originally at a discount.
Generally, the amount of the original issue discount
("OID") is treated as interest income and is included
in income over the term of the debt security, even
though payment of that amount is not received until a later time,
usually when the debt security matures.

If a Fund invests in certain high yield original
issue discount obligations issued by corporations, a
portion of the original issue discount accruing on the
obligation may be eligible for the deduction for
dividends received by corporations. In such event,
dividends of investment company taxable income received
from the Fund by its corporate shareholders, to the
extent attributable to such portion of accrued original
issue discount, may be eligible for this deduction for
dividends received by corporations if so designated by
the Fund in a written notice to shareholders.

Some of the debt securities (with a fixed maturity
date of more than one year from the date of issuance)
that may be acquired by a Fund in the secondary market
may be treated as having market discount. Generally,
gain recognized on the disposition of, and any partial
payment of principal on, a debt security having market
discount is treated as ordinary income to the extent
the gain, or principal payment, does not exceed the
"accrued market discount" on such debt security. In addition,
the deduction of any interest expenses attributable to debt
securities having market discount may be deferred.
Market discount generally accrues in equal daily
installments. A Fund may make one or more of the
elections applicable to debt securities having market
discount, which could affect the character and timing
of recognition of income.

Some debt securities (with a fixed maturity date
of one year or less from the date of issuance) that may
be acquired by a Fund may be treated as having
acquisition discount, or OID in the case of certain
types of debt securities. Generally, a Fund will be
required to include the acquisition discount, or OID, in income
over the term of the debt security, even though payment of
that amount is not received until a later time, usually
when the debt security matures. A Fund may make one or
more of the elections applicable to debt securities
having acquisition discount, or OID, which could affect
the character and timing of recognition of income.

A Fund generally will be required to distribute
dividends to shareholders representing discount on debt
securities that is currently includible in income, even
though cash representing such income may not have been
received by a Fund. Cash to pay such dividends may be
obtained from sales proceeds of securities held by a
Fund.

DISTRIBUTIONS

Distributions of investment company taxable income
are taxable to a U.S. shareholder as ordinary income,
whether paid in cash or shares. Dividends paid by a
Fund to a corporate shareholder, to the extent such
dividends are attributable to dividends received from
U.S. corporations by the Fund, may qualify for the
dividends received deduction. However, the revised
alternative minimum tax applicable to corporations may
reduce the value of the dividends received deduction.
Distributions of net capital gains (the excess of net long-term
capital gains over net short-term capital losses), if any,
designated by a Fund as capital gain dividends, are
taxable as long-term capital gains, whether paid in
cash or in shares, regardless of how long the
shareholder has held a Fund's shares and are not
eligible for the dividends received deduction.
Shareholders receiving distributions in the form of newly issued
shares will have a cost basis in each share received
equal to the net asset value of a share of a Fund on
the distribution date. A distribution of an amount in
excess of a Fund's current and accumulated earnings and
profits will be treated by a shareholder as a return of
capital which is applied against and reduces the
shareholder's basis in his or her shares. To the extent that the
amount of any such distribution exceeds the
shareholder's basis in his or her shares, the excess
will be treated by the shareholder as gain from a sale
or exchange of the shares. Shareholders will be
notified annually as to the U.S. Federal tax status of
distributions and shareholders receiving distributions
in the form of newly issued shares will receive a report as to
the net asset value of the shares received.

If the net asset value of shares is reduced below
a shareholder's cost as a result of a distribution by a
Fund, such distribution generally will be taxable even
though it represents a return of invested capital.
Shareholders should be careful to consider the tax
implications of buying shares just prior to a
distribution. The price of shares purchased at this time may
reflect the amount of the forthcoming distribution. Those
purchasing just prior to a distribution will receive a
distribution which generally will be taxable to them.

DISPOSITION OF SHARES

Upon a redemption, sale or exchange of his or her
shares, a shareholder will realize a taxable gain or
loss depending upon his or her basis in the shares.
Such gain or loss will be treated as capital gain or
loss if the shares are capital assets in the
shareholder's hands and generally will be long-term or
short-term, depending upon the shareholder's holding period for
the shares. Any loss realized on a redemption sale or
exchange will be disallowed to the extent the shares
disposed of are replaced (including through
reinvestment of dividends) within a period of 61 days
beginning 30 days before and ending 30 days after the
shares are disposed of. In such a case, the basis of

the shares acquired will be adjusted to reflect the
disallowed loss. Any loss realized by a shareholder on
the sale of Fund shares held by the shareholder for
six-months or less will be treated for tax purposes as
a long-term capital loss to the extent of any
distributions of capital gain dividends received or
treated as having been received by the shareholder with respect
to such shares.

In some cases, shareholders will not be permitted
to take all or portion of their sales loads into
account for purposes of determining the amount of gain
or loss realized on the disposition of their shares.
This prohibition generally applies where (1) the
shareholder incurs a sales load in acquiring the shares
of a Fund, (2) the shares are disposed of before the 91st
day after the date on which they were acquired, and (3) the
shareholder subsequently acquires shares in a Fund or another
regulated investment company and the otherwise
applicable sales charge is reduced under a
"reinvestment right" received upon the initial purchase
of Fund shares. The term "reinvestment right" means
any right to acquire shares of one or more regulated
investment companies without the payment of a sales load or with
the payment of a reduced sales charge. Sales charges
affected by this rule are treated as if they were
incurred with respect to the shares acquired under the
reinvestment right. This provision may be applied to
successive acquisitions of fund shares.

FOREIGN WITHHOLDING TAXES

Income received by a Fund from sources within a
foreign country may be subject to withholding and other
taxes imposed by that country.

If more than 50% of the value of a Fund's total
assets at the close of its taxable year consists of
securities of foreign corporations, the Fund will be
eligible and may elect to "pass- through" to that Fund's
shareholders the amount of foreign income and similar
taxes paid by that Fund. Pursuant to this election, a
shareholder will be required to include in gross income (in
addition to taxable dividends actually received) his or her
pro rata share of the foreign income and similar taxes
paid by a Fund, and will be entitled either to deduct
his or her pro rata share of foreign income and similar
taxes in computing his or her taxable income or to use
it as a foreign tax credit against his or her U.S.
Federal income taxes, subject to limitations. No
deduction for foreign taxes may be claimed by a shareholder who
does not itemize deductions. Foreign taxes generally may
not be deducted by a shareholder that is an individual
in computing the alternative minimum tax. Each
shareholder will be notified within 60 days after the
close of a Fund's taxable year whether the foreign
taxes paid by the Fund will "pass-through" for that
year and, if so, such notification will designate (1) the
shareholder's portion of the foreign taxes paid to each such
country and (2) the portion of the dividend which represents
income derived from sources within each such country.

Generally, a credit for foreign taxes is subject
to the limitation that it may not exceed the
shareholder's U.S. tax attributable to his or her total
foreign source taxable income. For this purpose, if a
Fund makes the election described in the preceding
paragraph, the source of that Fund's income flows
through to its shareholders. With respect to a Fund, gains from
the sale of securities generally will be treated as
derived from U.S. sources and section 988 gains will be
treated as ordinary income derived from U.S. sources.
The limitation on the foreign tax credit is applied
separately to foreign source passive income, including
foreign source passive income received from a Fund. In
addition, the foreign tax credit may offset only 90% of
the revised alternative minimum tax imposed on corporations and
individuals.

The foregoing is only a general description of the
foreign tax credit under current law. Because
application of the credit depends on the particular
circumstances of each shareholder, shareholders are
advised to consult their own tax advisers.

BACKUP WITHHOLDING

Each Fund will be required to report to the
Internal Revenue Service ("IRS") all taxable
distributions as well as gross proceeds from the
redemption of the particular Fund's shares, except in
the case of certain exempt shareholders. All such
distributions and proceeds will be subject to withholding of
Federal income tax at a rate of 31% ("backup withholding") in
the case of non-exempt shareholders if (1) the
shareholder fails to furnish a Fund with and to certify
the shareholder's correct taxpayer identification
number or social security number, (2) the IRS notifies
the shareholder or the particular Fund that the
shareholder has failed to report properly certain interest and
dividend income to the IRS and to respond to notices to
that effect, or (3) when required to do so, the
shareholder fails to certify that he or she is not
subject to backup withholding. If the withholding
provisions are applicable, any such distributions or
proceeds, whether reinvested in additional shares or taken in
cash, will be reduced by the amounts required to be
withheld.

Distributions may also be subject to additional
state, local and foreign taxes depending on each
shareholder's particular situation. Non-U.S.
shareholders may be subject to U.S. tax rules that
differ significantly from those summarized above. This
discussion does not purport to deal with all of the tax
consequences applicable to a Fund or shareholders. Shareholders
are advised to consult their own tax advisers with
respect to the particular tax consequences to them of
an investment in a Fund.

PERFORMANCE INFORMATION

Comparisons of a Fund's performance may be made
with respect to various unmanaged indices (including
the TSE 300, S&P 100, S&P 500, Dow Jones Industrial
Average and Major Market Index) which

assume reinvestment of dividends, but do not reflect
deductions for administrative and management costs. A
Fund also may be compared to Lipper's Analytical
Reports, reports produced by a widely used independent
research firm that ranks mutual funds by overall
performance, investment objectives and assets, or to
Wiesenberger Reports. Lipper Analytical Services does not
include sales charges in computing performance. Further
information on comparisons is contained in the Prospectus.
Performance rankings will be based on historical information
and are not intended to indicate future performance.

In addition, the Trust may, from time to time,
include the average annual total return and the
cumulative total return of shares of a Fund in
advertisements, promotional literature or reports to
shareholders or prospective investors.

AVERAGE ANNUAL TOTAL RETURN. Quotations of
standardized average annual total return ("Standardized
Return") for a specific Class of shares of a Fund will
be expressed in terms of the average annual compounded
rate of return that would cause a hypothetical
investment in that Class of a Fund made on the first
day of a designated period to equal the ending redeemable value
("ERV") of such hypothetical investment on the last day of
the designated period, according to the following
formula:

P(1 + T){superscript n} = ERV

Where: P = a hypothetical initial payment of
$1,000 to purchase shares of a
specific Class

T = the average annual total return of
shares of that Class

n = the number of years

ERV = the ending redeemable value of a
hypothetical $1,000 payment made at
the beginning of the period.

For purposes of the above computation for a Fund,
it is assumed that all dividends and capital gains
distributions made by a Fund are reinvested at net
asset value in additional shares of the same Class
during the designated period. In calculating the
ending redeemable value for Class A shares and assuming
complete redemption at the end of the applicable period, the
maximum 5.75% sales charge is deducted from the initial
$1,000 payment and, for Class B shares and Class C
shares, the applicable CDSC imposed upon redemption of
Class B shares or Class C shares held for the period is
deducted. Standardized Return quotations for the Funds
do not take into account any required payments for
federal or state income taxes. Standardized Return
quotations for Class B shares for periods of over eight
years will reflect conversion of the Class B shares to

Class A shares at the end of the eighth year.
Standardized Return quotations are determined to the
nearest 1/100 of 1%.

A Fund may, from time to time, include in
advertisements, promotional literature or reports to
shareholders or prospective investors total return data
that are not calculated according to the formula set
forth above ("Non-Standardized Return"). Neither
initial nor CDSCs are taken into account in calculating Non-
Standardized Return; a sales charge, if deducted, would reduce
the return.

The following tables summarize the calculation of
Standardized and Non-Standardized Return for the Class A,
Class B, Class C and Class I (for Ivy International
Fund) shares of the Funds for the periods indicated.
In determining the average annual total return for a
specific Class of shares of a Fund, recurring fees, if
any, that are charged to all shareholder accounts are
taken into consideration. For any account fees that
vary with the size of the account of a Fund, the account fee used
for purposes of the following computations is assumed to
be the fee that would be charged to the mean account
size of the particular Fund. Shares of each of Ivy
Canada Fund and Ivy Global Fund outstanding as of March
31, 1994 were designated Class A shares of each
respective Fund. Shares of Ivy International Fund
outstanding as of October 22, 1993 have been
redesignated as "Class A" shares of the Fund. The information
provided below information is not yet available for Ivy
Global Science & Technology Fund, which commenced
operations on July 22, 1996, and Ivy Asia Pacific Fund,
Ivy Global Natural Resources Fund and Ivy International
Small Companies Fund, which commenced operations on
January 1, 1997.

IVY CANADA FUND:

STANDARDIZED RETURN[*] CLASS A[1]
CLASS B[2] CLASS C[6]

One year ended
December 31,
1995: .26% .74% N/A

Five years ended
December 31,
1995: 3.29% N/A N/A

Inception[#] to
December 31,
1995:[5] 1.18% (6.49)% N/A

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[6]

One year ended

December 31,
1995: 6.37% 5.74% N/A

Five years ended
December 31,
1995: 4.52% N/A N/A

Inception[#] to
December 31,
1995:[5] 1.91% (4.28)% N/A
_________________________

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy Canada Fund (and the
Class A shares of the Fund) was November 17, 1987;
the inception date for Class B shares of the Fund
was April 1, 1994. The inception date for Class C
shares of the Fund is April 30, 1996. Until
December 31, 1994, Mackenzie Investment
Management, Inc. served as investment adviser to the Fund,
which until that date was a series of the Company.

[1] The Standardized Return figures for Class A shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class A
shares for the one year ended December 31, 1995,
the five years ended December 31, 1995 and the
period from inception through December 31, 1995
would have been (.08)%, 3.22% and .71%, respectively.

[2] The Standardized Return figures for Class B shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class B
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been .40% and (6.67)%,
respectively. (Since the inception date for Class B shares
of the Fund was April 1, 1994, there were no Class B
shares outstanding for the duration of the five
year period ending December 31, 1995.)

[3] The Non-Standardized Return figures for Class A
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class A shares for the one year ended December
31, 1995, the five years ended December 31, 1995
and the period from inception through December 31,
1995 would have been 6.01%, 4.45% and 1.44%,
respectively.

[4] The Non-Standardized Return figures for Class B
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class B shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been 5.39% and
(4.47)%, respectively. (Since the inception date
for Class B shares of the Fund was April 1, 1994, there
were no Class B shares outstanding for the duration of the
five year period ending December 31, 1995.)

[5] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[6] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

IVY CHINA REGION FUND:

STANDARDIZED RETURN[*]
CLASS A[1] CLASS B[2] CLASS C[6]

One year ended
December 31,
1995: (4.26)% (4.17)% N/A

Inception[#] to
December 31,
1995:[5] (8.10)% (7.58)% N/A

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[6]

One year ended
December 31,
1995: (1.59)% .83% N/A

Inception[#] to
December 31,
1995:[5] (5.56)% (6.27)% N/A
_________________________

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy China Region Fund
(Class A and Class B shares) was October 23, 1993.
The inception date for Class C shares of the Fund
is April 30, 1996.

[1] The Standardized Return figures for Class A shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class A
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been (4.70)% and (8.57)%,
respectively.

[3] The Non-Standardized Return figures for Class A
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class A shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been 1.11% and
(6.06)%, respectively.

[5] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[6] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

IVY GLOBAL FUND:

STANDARDIZED RETURN[*]
CLASS A[1] CLASS B[2] CLASS C[6]

One year ended
December 31,
1995: 5.64% 6.25% N/A

Inception[#] to
December 31,
1995:[5] 8.05% 3.00% N/A

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[6]

One year ended
December 31,
1995: 12.08% 11.25% N/A

Inception[#] to
December 31,
1995:[5] 9.42% 5.22% N/A
_________________________

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy Global Fund (and Class
A shares of the Fund) was April 18, 1991; the
inception date for Class B shares of the Fund was
April 1, 1994; and the inception date for the
Class C shares of the Fund is April 30, 1996.
Until December 31, 1994, Mackenzie Investment
Management Inc. served as investment adviser to the Fund,
which until that date was a series of the Company.

[1] The Standardized Return figures for Class A shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class A
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been 5.37% and 7.02%,
respectively.

[3] The Non-Standardized Return figures for Class A
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class A shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been 11.80% and
3.38%, respectively.

period from inception through December 31, 1995
would have been 10.97% and 5.05%, respectively.

[5] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[6] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

IVY INTERNATIONAL FUND

STANDARDIZED
RETURN[*] CLASS A[1] CLASS B[2] CLASS
C[7] CLASS I[5]

One year ended
December 31,
1995: 6.17% 6.62% N/A
12.85%
Five years ended
December 31,
1995: 13.88% N/A N/A
N/A

Inception[#] to
December 31,
1995:[6] 14.42% 8.57% N/A
10.41%

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[7] CLASS
I[5]

One year ended
December 31,
1995: 12.65% 11.62% N/A
12.85%

Five years ended
December 31,
1995: 15.24% N/A N/A
N/A

Inception[#] to
December 31,
1995:[6] 15.13% 10.21% N/A
10.41%

_________________________

[*] The Standardized Return figures for Class A shares
reflect the deduction of the maximum initial sales
charge of 5.75%. The Standardized Return figures
for Class B shares reflect the deduction of the
applicable CDSC imposed on a redemption of Class B
shares held for the period. Class I shares are
not subject to an initial or a CDSC; therefore, the Non-
Standardized Return figures would be identical to the
Standardized Return figures.

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy International Fund (and
the Class A shares of the Fund) was April 21,
1986; the inception date for the Class B and Class
I shares of the Fund was October 23, 1993; and the
inception date for the Class C shares of the Fund
is April 30, 1996.

[2] The Standardized Return figures for Class B shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class B
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been 6.62% and 8.57%,
respectively. (Since the inception date for Class B shares
of the Fund was October 23, 1993, there were no Class B
shares outstanding for the duration of the five year
period ending December 31, 1995.)

[4] The Non-Standardized Return figures for Class B
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class B shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been 11.62% and
10.21%, respectively. (Since the inception date
for Class B shares of the Fund was October 23, 1993,
there were no Class B shares outstanding for the duration of
the five year period ending December 31, 1995.)

[5] Class I shares are not subject to an initial sales
charge or a CDSC, therefore the Non-Standardized
and Standardized Return figures are identical.
(Since the inception date for Class I shares of
the Fund was October 23, 1993, there were no Class
I shares outstanding for the duration of the five
year period ending December 31, 1995.)

[6] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[7] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

IVY LATIN AMERICA STRATEGY FUND

STANDARDIZED RETURN[*]
CLASS A[1] CLASS B[2] CLASS C[6]

One year ended
December 31,
1995: (22.04)% (22.90)% N/A

Inception[#] to
December 31,
1995:[5] (30.65)% (30.06)% N/A

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[6]

One year ended
December 31,
1995: (17.28)% (17.90)% N/A

Inception[#] to
December 31,
1995:[5] (26.93)% (27.47)% N/A
_________________________

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy Latin America Strategy
Fund (Class A and Class B shares) was November 1,
1994. The inception date for Class C shares of
the Fund is April 30, 1996.

[1] The Standardized Return figures for Class A shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class A
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been (28.49)% and (36.91)%,
respectively.

[2] The Standardized Return figures for Class B shares
reflect expense reimbursement. Without expense
reimbursement, the

Standardized Return for Class B shares for the one
year ended December 31, 1995 and the period from
inception through December 31, 1995 would have
been (29.29)% and (36.10)%, respectively.

[3] The Non-Standardized Return figures for Class A
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class A shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been (24.09)% and
(33.57)%, respectively.

[5] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[6] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

IVY NEW CENTURY FUND

STANDARDIZED RETURN[*]
CLASS A[1] CLASS B[2] CLASS C[6]

One year ended
December 31,
1995: .29% .62% N/A

Inception[#] to
December 31,
1995:[5] (11.54)% (3.01)% N/A

NON-STANDARDIZED RETURN[**]
CLASS A[3] CLASS B[4] CLASS C[6]

One year ended
December 31,
1995: 6.40% 5.62% N/A

Inception[#] to
December 31,
1995:[5] (6.88)% (7.56)% N/A
_________________________

[*] The Standardized Return figures for Class A shares
reflect the deduction of the maximum initial sales
charge of 5.75%.

The Standardized Return figures for Class B shares
reflect the deduction of the applicable CDSC
imposed on a redemption of Class B shares held for
the period.

[**] The Non-Standardized Return figures do not reflect
the deduction of any initial sales charge or CDSC.

[#] The inception date for Ivy New Century Fund (Class
A and Class B shares) was November 1, 1994. The
inception date for Class C shares of the Fund is
April 30, 1996.

[1] The Standardized Return figures for Class A shares
reflect expense reimbursement. Without expense
reimbursement, the Standardized Return for Class A
shares for the one year ended December 31, 1995
and the period from inception through December 31,
1995 would have been (3.34)% and (15.73)%,
respectively.

[3] The Non-Standardized Return figures for Class A
shares reflect expense reimbursement. Without
expense reimbursement, the Non-Standardized Return
for Class A shares for the one year ended December
31, 1995 and the period from inception through
December 31, 1995 would have been 2.58% and
(11.28)%, respectively.

[5] The total return for a period less than a full
year is calculated on an aggregate basis and is
not annualized.

[6] Since the inception date for Class C shares of the
Fund is April 30, 1996, there were no Class C
shares outstanding during any of the relevant time
periods.

CUMULATIVE TOTAL RETURN. Cumulative total return
is the cumulative rate of return on a hypothetical
initial investment of $1,000 in a specific Class of
shares of a Fund for a specified period. Cumulative
total return quotations reflect changes in the price of
a Fund's shares and assume that all dividends and
capital gains distributions during the period were reinvested in
the Fund shares. Cumulative total return is calculated
by computing the cumulative rates of return of a
hypothetical

investment in a specific Class of shares of a Fund over
such periods, according to the following formula
(cumulative total return is then expressed as a
percentage):

C = (ERV/P) - 1

Where: C = cumulative total return

P = a hypothetical initial investment
of $1,000 to purchase shares of a
specific Class

ERV = ending redeemable value: ERV is
the value, at the end of the
applicable period, of a
hypothetical $1,000 investment made at the
beginning of the applicable period.

IVY CANADA FUND. The following table summarizes
the calculation of Cumulative Total Return for the
periods indicated through December 31, 1995, assuming
the maximum 5.75% sales charge has been assessed.
SINCE
ONE YEAR FIVE YEARS INCEPTION[*]

Class A .26% 17.56% 10.03%
Class B .74% N/A[**] (11.08)%
Class C N/A[**] N/A[**] N/A[**]

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR FIVE YEARS INCEPTION[*]

Class A 6.37% 24.73% 16.74%
Class B 5.74% N/A[**] (7.37)%
Class C N/A[**] N/A[**] N/A[**]

___________________________

[*] The inception date for Ivy Canada Fund (and the
Class A shares of the Fund) was November 17, 1987;
the inception date for the Class B shares of Ivy
Canada Fund was April 1, 1994. Until December 31,
1994, Mackenzie Investment Management, Inc. served
as investment adviser to Ivy Canada Fund, which
until that date was a series of the Company.

[**] No such shares were outstanding for the duration
of the time period indicated.

IVY CHINA REGION FUND. The following table
summarizes the calculation of Cumulative Total Return
for the periods indicated through December 31, 1995,
assuming the maximum 5.75% sales charge has been
assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A (4.27)% (16.83)%
Class B (4.17)% (15.79)%
Class C N/A[**] N/A[**]

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A 1.59% (11.75)%
Class B .83% (13.19)%
Class C N/A[**] N/A[**]

___________________________

[*] The inception date for Ivy China Region Fund was
October 23, 1993.

[**] No such shares were outstanding for the duration
of the time period indicated.

IVY GLOBAL FUND. The following table summarizes
the calculation of Cumulative Total Return for the
periods indicated through December 31, 1995, assuming
the maximum 5.75% sales charge has been assessed.
SINCE
ONE YEAR INCEPTION[*]

Class A 5.64% 44.00%
Class B 6.25% 5.31%
Class C N/A[**] N/A[**]

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A 12.08% 52.79%
Class B 11.25% 9.31%
Class C N/A[**] N/A[**]

___________________________

[*] The inception date for the Fund (and Class A
shares of the Fund) was April 18, 1991; the
inception date for Class B shares of the Fund was
April 1, 1994. Until December 31, 1994, Mackenzie
Investment Management Inc. served as

investment adviser to the Fund, which until that
date was a series of the Company.

[**] No such shares were outstanding for the duration
of the time period indicated.

IVY INTERNATIONAL FUND. The following table
summarizes the calculation of Cumulative Total Return
for the periods indicated through December 31, 1995,
assuming the maximum 5.75% sales charge has been
assessed.
SINCE
ONE YEAR FIVE YEARS INCEPTION[*]

Class A 6.17% 91.54% 268.32%
Class B 6.62% N/A[**] 20.72%
Class C N/A[**] N/A[**] N/A[**]
Class I 12.85% N/A[**] 24.25%

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR FIVE YEARS INCEPTION[*]

Class A 12.65% 103.22% 290.79%
Class B 11.62% N/A[**] 23.72%
Class C N/A[**] N/A[**] N/A[**]
Class I 12.85% N/A[**] 24.25%
___________________________

[*] The inception date for Ivy International Fund (and
the Class A shares of the Fund) was April 21,
1986; the inception date for the Class B and Class
I shares of Ivy International Fund was October 23,
1993.

[**] No such shares were outstanding for the duration
of the time period indicated.

IVY LATIN AMERICA STRATEGY FUND. The following
table summarizes the calculation of Cumulative Total
Return for the periods indicated through December 31,
1995, assuming the maximum 5.75% sales charge has been
assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A (22.04)% (34.59)%
Class B (22.90)% (33.95)%
Class C N/A[**] N/A[**]

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A (17.28)% (30.60)%
Class B (17.90)% (31.20)%
Class C N/A[**] N/A[**]

___________________________

[*] The inception date for Ivy Latin America Strategy
Fund was November 1, 1994.

[**] No such shares were outstanding for the duration
of the time period indicated.

IVY NEW CENTURY FUND. The following table
summarizes the calculation of Cumulative Total Return
for the periods indicated through December 31, 1995,
assuming the maximum 5.75% sales charge has been
assessed.
SINCE
ONE YEAR INCEPTION[*]

Class A .29% (13.25)%
Class B .62% (12.40)%
Class C N/A[**] N/A[**]

The following table summarizes the calculation of
Cumulative Total Return for the periods indicated
through December 31, 1995, assuming the maximum 5.75%
sales charge has not been assessed.

SINCE
ONE YEAR INCEPTION[*]

Class A 6.40% (7.96)%
Class B 5.62% (8.75)%
Class C N/A[**] N/A[**]

___________________________

[*] The inception date for Ivy New Century Fund was
November 1, 1994.

[**] No such shares were outstanding for the duration
of the time period indicated.

OTHER QUOTATIONS, COMPARISONS AND GENERAL
INFORMATION. The foregoing computation methods are
prescribed for advertising and other communications
subject to SEC Rule 482. Communications not subject to
this rule may contain a number of different measures of
performance, computation methods and assumptions, including

but not limited to: historical total returns; results
of actual or hypothetical investments; changes in
dividends, distributions or share values; or any
graphic illustration of such data. These data may
cover any period of the Trust's existence and may or may
not include the impact of sales charges, taxes or other factors.

Performance quotations for a Fund will vary from
time to time depending on market conditions, the
composition of the Fund's portfolio and operating
expenses of that Fund. These factors and possible
differences in the methods used in calculating
performance quotations should be considered when
comparing performance information regarding a Fund's shares with
information published for other investment companies and
other investment vehicles. Performance quotations
should also be considered relative to changes in the
value of a Fund's shares and the risks associated with
a Fund's investment objectives and policies. At any
time in the future, performance quotations may be
higher or lower than past performance quotations and there can
be no assurance that any historical performance quotation
will continue in the future.

The Funds may also cite endorsements or use for
comparison their performance rankings and listings
reported in such newspapers or business or consumer
publications as, among others: AAII Journal, Barron's,
Boston Business Journal, Boston Globe, Boston Herald,
Business Week, Consumer's Digest, Consumer Guide
Publications, Changing Times, Financial Planning, Financial
World, Forbes, Fortune, Growth Fund Guide, Houston Post,
Institutional Investor, International Fund Monitor, Investor's
Daily, Los Angeles Times, Medical Economics, Miami
Herald, Money Mutual Fund Forecaster, Mutual Fund
Letter, Mutual Fund Source Book, Mutual Fund Values,
National Underwriter, Nelson's Directory of Investment
Managers, New York Times, Newsweek, No Load Fund
Investor, No Load Fund* X, Oakland Tribune, Pension
World, Pensions and Investment Age, Personal Investor, Rugg and
Steele, Time, U.S. News and World Report, USA Today, The
Wall Street Journal, and Washington Post.

FINANCIAL STATEMENTS

The Funds' Portfolios of Investments as of
December 31, 1995, Statements of Assets and Liabilities
as of December 31, 1995, Statements of Operations for
the fiscal year ended December 31, 1995, Statements of
Changes in Net Assets for the fiscal years ended
December 31, 1995 and December 31, 1994, Financial
Highlights, Notes to Financial Statements, and Reports of
Independent Accountants are included in each Fund's December 31,
1995 Annual Report to shareholders, which are
incorporated by reference into this SAI. See the
Prospectus for the interim unaudited financial
information for Ivy Global Science & Technology Fund.
The Statement of Assets and Liabilities for each of Ivy
Asia Pacific Fund, Ivy Global Natural Resources Fund
and Ivy International Small Companies Fund as of December 10,
1996 and the Notes thereto are attached hereto as Appendix
B.

APPENDIX A

DESCRIPTION OF STANDARD & POOR'S CORPORATION
("S&P") AND MOODY'S INVESTORS SERVICE, INC.
("MOODY'S") CORPORATE BOND AND
COMMERCIAL PAPER RATINGS

[From "Moody's Bond Record," November 1994 Issue
(Moody's Investor Service, New York, 1994), and
"Standard & Poor's Municipal Ratings Handbook," October
1994 Issue (McGraw Hill, New York, 1994).]

MOODY'S:

(a) CORPORATE BONDS. Bonds rated Aaa by Moody's
are judged by Moody's to be of the best quality,
carrying the smallest degree of investment risk.
Interest payments are protected by a large or
exceptionally stable margin and principal is secure.
Bonds rated Aa are judged by Moody's to be of high quality by all
standards. Aa bonds are rated lower than Aaa bonds
because margins of protection may not be as large as
those of Aaa bonds, or fluctuations of protective
elements may be of greater amplitude, or there may be
other elements present which make the long-term risks
appear somewhat larger than those applicable to Aaa
securities. Bonds which are rated A by Moody's possess many
favorable investment attributes and are considered as upper
medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but
elements may be present which suggest a susceptibility
to impairment sometime in the future.

Bonds rated Baa by Moody's are considered medium-
grade obligations, i.e., they are neither highly
protected nor poorly secured. Interest payments and
principal security appear adequate for the present, but
certain protective elements may be lacking or may be
characteristically unreliable over any great length of
time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as
well. Bonds which are rated Ba are judged to have
speculative elements; their future cannot be considered
well-assured. Often the protection of interest and
principal payments may be very moderate and thereby not
well safeguarded during both good and bad times over
the future. Uncertainty of position characterizes
bonds in this class. Bonds which are rated B generally lack
characteristics of the desirable investment. Assurance of
interest and principal payments of or maintenance of other
terms of the contract over any long period of time may
be small.

Bonds which are rated Caa are of poor standing.
Such issues may be in default or there may be present
elements of danger with respect to principal or
interest. Bonds which are rated Ca represent
obligations which are speculative in a high degree.
Such issues are often in default or have other marked
shortcomings. Bonds which are rated C are the lowest rated class

of bonds and issues so rated can be regarded as having
extremely poor prospects of ever attaining any real
investment standing.

(b) COMMERCIAL PAPER. The Prime rating is the
highest commercial paper rating assigned by Moody's.
Among the factors considered by Moody's in assigning
ratings are the following: (1) evaluation of the
management of the issuer; (2) economic evaluation of
the issuer's industry or industries and an appraisal of
speculative-type risks which may be inherent in certain
areas; (3) evaluation of the issuer's products in
relation to competition and customer acceptance; (4) liquidity;
(5) amount and quality of long-term debt; (6) trend of
earnings over a period of ten years; (7) financial
strength of a parent company and the relationships
which exist with the issuer; and (8) recognition by
management of obligations which may be present or may
arise as a result of public interest questions and
preparations to meet such obligations. Issuers within this Prime
category may be given ratings 1, 2 or 3, depending on
the relative strengths of these factors. The
designation of Prime-1 indicates the highest quality
repayment capacity of the rated issue.

S&P:

(a) CORPORATE BONDS. An S&P corporate debt
rating is a current assessment of the creditworthiness
of an obligor with respect to a specific obligation.
The ratings are based on current information furnished
by the issuer or obtained by S&P from other sources it
considers reliable. The ratings described below may be
modified by the addition of a plus or minus sign to
show relative standing within the major rating categories.

Debt rated AAA by S&P is considered by S&P to be
the highest grade obligation. Capacity to pay interest
and repay principal is extremely strong. Debt rated AA
is judged by S&P to have a very strong capacity to pay
interest and repay principal and differs from the
highest rated issues only in small degree. Debt rated
A by S&P has a strong capacity to pay interest and repay
principal, although it is somewhat more susceptible to the
adverse effects of changes in circumstances and economic
conditions than debt in higher rated categories.

Debt rated BBB by S&P is regarded by S&P as having
an adequate capacity to pay interest and repay
principal. Although such bonds normally exhibit
adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to
lead to a weakened capacity to pay interest and repay
principal than debt in higher rated categories.

Debt rated BB, B, CCC, CC and C is regarded as
having predominately speculative characteristics with
respect to capacity to pay interest and repay
principal. BB indicates the least degree of
speculation and C the highest. While such debt will
likely have some quality and protective characteristics,

these are outweighed by large uncertainties or
exposures to adverse conditions. Debt rated BB has
less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing
uncertainties or exposure to adverse business,
financial or economic conditions which could lead to
inadequate capacity to meet timely interest and principal
payments. The BB rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied
BBB- rating. Debt rated B has a greater vulnerability
to default but currently has the capacity to meet
interest payments and principal repayments. Adverse
business, financial, or economic conditions will likely
impair capacity or willingness to pay interest and
repay principal. The B rating category is also used
for debt subordinated to senior debt that is assigned an actual
or implied BB or BB- rating. Debt rated CCC has a
currently identifiable vulnerability to default, and is
dependent upon favorable business, financial, and
economic conditions to meet timely payment of interest
and repayment of principal. In the event of adverse
business, financial or economic conditions, it is not
likely to have the capacity to pay interest and repay
principal. The CCC rating category is also used for debt
subordinated to senior debt that is assigned an actual or
implied B or B- rating. The rating CC typically is
applied to debt subordinated to senior debt which is
assigned an actual or implied CCC debt rating. The
rating C typically is applied to debt subordinated to
senior debt which is assigned an actual or implied CCC-
debt rating. The C rating may be used to cover a
situation where a bankruptcy petition has been filed, but debt
service payments are continued.

(b) COMMERCIAL PAPER. An S&P commercial paper
rating is a current assessment of the likelihood of
timely payment of debt having an original maturity of
no more than 365 days.

Commercial paper rated A by S&P has the following
characteristics: (i) liquidity ratios are adequate to
meet cash requirements; (ii) long-term senior debt
rating should be A or better, although in some cases
BBB credits may be allowed if other factors outweigh
the BBB; (iii) the issuer should have access to at
least one additional channel of borrowing; (iv) basic
earnings and cash flow should have an upward trend with
allowances made for unusual circumstances; and (v) typically the
issuer's industry should be well established and the
issuer should have a strong position within its
industry and the reliability and quality of management
should be unquestioned. Issues rated A are further
referred to by use of numbers 1, 2 and 3 to denote
relative strength within this highest classification.
For example, the A-1 designation indicates that the degree of
safety regarding timely payment of debt is strong.

Issues rated B are regarded as having only
speculative capacity for timely payment. The C rating
is assigned to short- term debt obligations with a
doubtful capacity for payment.

APPENDIX B

STATEMENT OF ASSETS AND LIABILITIES
AS OF DECEMBER 10, 1996
AND
REPORT OF INDEPENDENT ACCOUNTANTS

_________________________________________________________________
IVY ASIA PACIFIC FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________

ASSETS
Cash . . . . . . . . . . . . . . . . $ 30
Deferred organization expenses . . . 13,732
Prepaid Blue Sky Fees . . . . . . . . 31,434
------- Total
Assets . . . . . . . . . . . 45,196
------- LIABILITIES
Due to affiliate . . . . . . . . . . 45,166
-------
NET ASSETS . . . . . . . . . . . . . . $ 30
=======
CLASS A:
Net asset value and
redemption price per share
($10 / 1 share outstanding) . . . $ 10.00
=======
Maximum offering price
per share
($10.00 x 100 / 94.25)* . . . . . $ 10.61
=======
CLASS B:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
CLASS C:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
NET ASSETS CONSISTS OF:
Capital paid-in . . . . . . . . . . . $ 30
=======

* On sales of more than $50,000 the offering price
is reduced. ** Redemption price per share is equal to
the net asset value per share less any applicable
contingent deferred sales charge, up to a maximum
of 5%.

(See Notes to Financial Statements)

_________________________________________________________________
IVY ASIA PACIFIC FUND
NOTES TO STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________

1. ORGANIZATION: Ivy Asia Pacific Fund is a diversified
series of shares of Ivy Fund. The shares of beneficial
interest are assigned no par value and an unlimited
number of shares of Class A, Class B and Class C are
authorized. Ivy Fund was organized as a Massachusetts
business trust under a Declaration of Trust dated
December 21, 1983 and is registered under the Investment Company
Act of 1940, as amended, as an open-end management
investment company.

The Fund will commence operations on January 1, 1997.
As of the date of this report, operations have been
limited to organizational matters and the issuance of
initial shares to Mackenzie Investment Management Inc.
(MIMI).

2. ORGANIZATION COSTS AND PREPAID BLUE SKY FEES:
Organization expenses are being amortized over a five
year period from January 1, 1997, the commencement date
of operations. Blue sky fees are being amortized over
a one year period from Januray 1, 1997. Such
organizational expenses and blue sky fees have been paid by
MIMI and will be reimbursed by the Fund.

3. TRANSACTIONS WITH AFFILIATES: Ivy Management, Inc.
(IMI), a wholly owned subsidiary of MIMI, is the
Manager and Investment Adviser of the Fund. Currently,
IMI voluntarily limits the Fund's total operating
expenses (excluding taxes, 12b-1 fees, brokerage
commissions, interest, litigation and indemnification
expenses, and any other extraordinary expenses) to an annual rate
of 1.95% of its average net assets.

MIMI provides certain administrative, accounting and
pricing services for the Fund.

Ivy Mackenzie Distributors, Inc. (IMDI), a wholly owned
subsidiary of MIMI, is the underwriter and distributor
of the Fund's shares, and as such, purchases shares
from the Fund at net asset value to settle orders from
investment dealers.

Ivy Mackenzie Services Corp. (IMSC), a wholly owned
subsidiary of MIMI, is the transfer and shareholder
servicing agent for the Fund.

Officers of Ivy Fund are officers and/or employees of
MIMI, IMI, IMDI and IMSC. Such individuals are not
compensated by the Fund for services in their capacity
as officers of Ivy Fund. Trustees of Ivy Fund who are
not affiliated with MIMI or IMI receive compensation
from the Fund.

STATEMENT OF ASSETS AND LIABILITIES
AS OF DECEMBER 10, 1996
AND REPORT OF INDEPENDENT ACCOUNTANTS

_________________________________________________________________
IVY GLOBAL NATURAL RESOURCES FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________

ASSETS
Cash . . . . . . . . . . . . . . . . $ 30
Deferred Organization Expenses . . . 13,732
Prepaid Blue Sky Fees . . . . . . . . 31,436
------- Total
Assets . . . . . . . . . . . 45,198
------- LIABILITIES
Due to affiliate . . . . . . . . . . 45,168
-------
NET ASSETS . . . . . . . . . . . . . . $ 30
=======
CLASS A:
Net asset value and
redemption price per share
($10 / 1 share outstanding) . . . $ 10.00
=======
Maximum offering price
per share
($10.00 x 100 / 94.25)* . . . . . $ 10.61
=======
CLASS B:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
CLASS C:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
NET ASSETS CONSISTS OF:
Capital paid-in . . . . . . . . . . . $ 30
=======

(See Notes to Financial Statements)

_________________________________________________________________
IVY GLOBAL NATURAL RESOURCES FUND
NOTES TO STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________

1. ORGANIZATION: Ivy Global Natural Resources Fund is a
diversified series of shares of Ivy Fund. The shares of
beneficial interest are assigned no par value and an
unlimited number of shares of Class A, Class B and
Class C are authorized. Ivy Fund was organized as a
Massachusetts business trust under a Declaration of
Trust dated December 21, 1983 and is registered under
the Investment Company Act of 1940, as amended, as an open-
end management investment company.

MIMI provides certain administrative, accounting and
pricing services for the Fund.

Ivy Mackenzie Services Corp. (IMSC), a wholly owned
subsidiary of MIMI, is the transfer and shareholder
servicing agent for the Fund.

STATEMENT OF ASSETS AND LIABILITIES
AS OF DECEMBER 10, 1996
AND REPORT OF INDEPENDENT ACCOUNTANTS

_________________________________________________________________
IVY INTERNATIONAL SMALL COMPANIES FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________
ASSETS
Cash . . . . . . . . . . . . . . . . $ 40
Deferred organization expenses . . . 13,755
Prepaid Blue Sky Fees . . . . . . . . 32,020
------- Total
Assets . . . . . . . . . . . 45,815
------- LIABILITIES
Due to affiliate . . . . . . . . . . 45,775
-------
NET ASSETS . . . . . . . . . . . . . . $ 40
======= CLASS A:
Net asset value and
redemption price per share
($10 / 1 share outstanding) . . . $ 10.00
=======
Maximum offering price
per share
($10.00 x 100 / 94.25)* . . . . . $ 10.61
=======
CLASS B:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
CLASS C:
Net asset value and
offering price per share
($10 / 1 share outstanding)** . . $ 10.00
=======
CLASS I:
Net asset value, offering price,
and redemption price per share
($10 / 1 share outstanding) . . . $ 10.00
=======
NET ASSETS CONSISTS OF:
Capital paid-in . . . . . . . . . . . $ 40
=======
* On sales of more than $50,000 the offering price is reduced.
** Redemption price per share is equal to the net asset
value per share less any applicable contingent
deferred sales charge, up to a maximum of 5%.

(See Notes to Financial Statements)

_________________________________________________________________
IVY INTERNATIONAL SMALL COMPANIES FUND
NOTES TO STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 10, 1996

_________________________________________________________________

1. ORGANIZATION: Ivy International Small Companies Fund
is a diversified series of shares of Ivy Fund. The
shares of beneficial interest are assigned no par value
and an unlimited number of shares of Class A, Class B,
Class C and Class I are authorized. Ivy Fund was
organized as a Massachusetts business trust under a
Declaration of Trust dated December 21, 1983 and is
registered under the Investment Company Act of 1940, as amended,
as an open-end management investment company.

MIMI provides certain administrative, accounting and
pricing services for the Fund.

Ivy Mackenzie Services Corp. (IMSC), a wholly owned
subsidiary of MIMI, is the transfer and shareholder
servicing agent for the Fund.

APPENDIX C

SELECTED ECONOMIC AND MARKET DATA FOR
ASIA PACIFIC AND CHINA REGION COUNTRIES

The information set forth in this Appendix has
been extracted from various government and private
publications. Ivy China Region Fund and the Trust's
Board of Trustees make no representation as to the
accuracy of such information, nor has the Fund or the
Trust's Board of Trustees attempted to verify it.
The China Region, one of the fastest growing areas
of the world, is diverse, dynamic and evolving. In
terms of population, this region is almost ten times
the size of the United States and is five times the
size of Europe.

Countries in this region are at various stages of
economic development. Hong Kong and Singapore are at a
more advanced stage of economic growth while countries
such as Indonesia and China are at the early stages of
economic development. GDP per capita data presented
below illustrates this point. The following table shows
the GDP, population and per capita GDP of the China Region
countries and, for comparison purposes, the United States.

1994

GDP ($US POPULATION
PER CAPITA BILLIONS)
(MILLIONS) GDP ($US) ---------
--------- --------- Hong Kong 131.8
5.7 23,123 Korea 379.6
43.4 8,747 Singapore 60.7
2.7 22,481 Taiwan 228.9
20.6 11,112 Thailand 143.2
54.5 2,628 Malaysia 71.6
17.6 4,068 Indonesia 159.7
129.4 890 Philippines 63.9
60.6 1,055 China 529.2
1,131.9 467 China Region 1,767.6
1,516.4 1,166 USA 6,738.4
248.7 27,095
Source: International Marketing Data and Statistics,
19th Ed. (Euromonitor 1995).

Total GDP for the China Region was about $1.7
billion in 1994, approximately one quarter of the GDP
of the United States. Year over year growth in GDP for
the China Region is significant, averaging 9.50% for
the five-year period 1990-1994 compared with only 3.39%
for the United States for the same period. The
following tables show the annual change in real GDP and
inflation, as measured by the Consumer Price Indexes (CPI), in
1990-1994 and the average for the five-year period
1990-1994.

CHANGE IN REAL GROSS DOMESTIC PRODUCT

AVERAGE 1990 1991 1992 1993
1994 1990-94 ----- ----- -----
- ----- ------ ------- Hong Kong 2.99% 3.94%
14.31% 14.75% 13.69% 9.94% Korea 9.05%
8.38% 4.68% 7.43% 14.06% 8.72% Singapore
8.37% 6.79% 14.49% 7.81% 10.38% 9.57% Taiwan
5.00% 7.30% 11.70% 6.97% 3.80% 6.95%
Thailand 10.27% 8.00% 8.50% 13.65% 14.36% 10.96%
Malaysia 9.95% 8.90% 22.32% 5.89% 11.05%
11.62% Indonesia 6.99% 6.35% 9.05% 13.10%
10.36% 9.17% Philippines 2.44% -1.02% 16.50%
1.87% 17.46% 7.45% China 5.37% 6.42%
14.85% 25.03% -6.72% 8.99% United States 0.64%
- -1.34% 5.81% 5.62% 6.23% 3.39%
Sources: 1989-1991 China Region countries, except
Taiwan: World Tables 1993, A World Bank Book; 1989-1991
Taiwan: Baring Securities, Pacific Rim Stock Market
Review, July 1993; 1992-1994 China Region countries:
International Marketing Data and Statistics, 19th Ed.
(Euromonitor 1995).

CHANGE IN CONSUMER PRICE INDEXES

AVERAGE 1990 1991 1992 1993
1994 1990-94 ----- ----- -----
- ----- ----- ------- Hong Kong 9.76% 10.98%
9.40% 8.54% 8.00% 9.34% Korea 8.56%
9.59% 6.30% 4.84% 6.22% 7.10% Singapore
3.46% 3.44% 2.30% 2.42% 3.01% 2.93% Taiwan
4.10% 3.60% 4.40% * *% 4.03%
Thailand 5.94% 5.69% 4.10% 3.31% 5.65% 4.94%
Malaysia 2.66% 4.34% 4.80% 3.59% *% 3.85%
Indonesia 7.39% 9.31% 7.20% 9.23% 6.28%
7.88% Philippines 14.18% 18.74% 8.90% 7.60% *%
12.36% China 1.35% 2.90% 5.40% *
16.97% 6.66% United States 5.41% 4.26% 3.00%
3.00% 2.57% 3.65%

Sources: 1989-91 China Region countries, except Taiwan
and 1991-1992 China: World Tables 1993, A World Bank
Book; 1989-1991 Taiwan: Baring Securities, Pacific Rim
Stock Market Review, July 1993; 1991-1992 China: China
Statistical Yearbook; 1992 China Region countries:
Morgan Stanley Investment Research Japan & Asia/Pacific
June/July, 1993; 1993-1994 China Region countries,
except Taiwan and China: International Marketing Data and
Statistics, 19th Ed. (Euromonitor 1995).

* Not available. Average reflects data from available
years.
As the economic in the China Region have
experienced different levels of growth, so too have
their stock markets. Countries in the China Region now
account for nearly 9.4% of world stock market
capitalization. The following tables show the

capitalization of the stock markets, and the changes in
stock prices as measured by the local stock indexes.

STOCK MARKET CAPITALIZATION ($US MILLIONS)

1990 1991 1992 1993
1994 ------- ------- ------- -----
- -- ------- China -- 2,028 18,255
40,567 43,521 Hong Kong 83,397 121,986
172,106 385,247 269,508 Korea 110,594
96,373 107,448 139,420 191,778 Singapore
34,308 47,637 48,818 132,742 134,516 Taiwan
100,710 124,864 101,124 195,191 242,325
Thailand 23,896 35,815 58,259 130,510 131,479
Malaysia 48,611 58,627 94,004 220,328
199,276 Indonesia 8,081 6,823 12,038
32,953 47,241 Philippines 5,927 10,197
13,794 40,327 55,519

Sources: Emerging Stock Market Fact Book 1995,
International Finance Corp.

ANNUAL PERCENTAGE CHANGES IN LOCAL
STOCK MARKET INDEXES

1990 1991 1992 1993
1994 ------ ------ ------ -----
- - ------ China -- 192.80% 166.53%
6.84% -22.30% Hong Kong 6.63% 42.08%
28.27% 115.70% 28.8% Korea -23.48%
- -12.24% 11.05% 27.67% 18.61% Singapore
- -22.06% 29.12% 2.26% 48.30% 3.30% Taiwan
-52.93% 1.56% -26.60% 79.76% 17.36%
Thailand -30.29% 16.07% 25.59% 88.36% -19.18%
Malaysia -10.02% 9.94% 15.77% 98.04%
- -23.85% Indonesia 4.53% -40.79% 10.89%
114.61% -20.23% Philippines -45.10% 94.77%
5.27% 166.60% -12.84%

Sources: China Region countries, except Singapore,
Emerging Stock Market Fact Book 1995, International
Finance Corp.; Hong Kong and Singapore 1988-1992:
Baring Securities, Pacific Rim Stock Market Review,
July 1993; Hong Kong and Singapore 1993: Jardine Fleming,
January 1994; Hong Kong and Singapore 1994: Morgan Stanley.

Equity valuations in the China Region, as measured
by price/earnings ratios, also vary from country to
country according to economic growth forecasts,
corporate earnings growth forecasts, the outlook for
inflation, exchange rates and overall investor
sentiment.

PRICE/EARNINGS RATIOS

1990 1991 1992 1993
1994 ----- ----- ----- -----
----- Hong Kong 10.5 12.9 15.8 *
13.3 Korea 16.4 21.3 21.4
25.1 34.5 Singapore 16.3 17.7 16.1
* 19.5

Taiwan 25.0 22.3 16.6 34.7
36.8 Thailand 8.7 12.0 13.9 27.5
21.2 Malaysia 23.6 21.3 21.8
43.5 29.0 Indonesia 20.3 11.6 12.2
28.9 20.2 Philippines 11.3 11.3
14.1 38.8 30.8

Sources: 1989-1992 Hong Kong and Singapore: Morgan
Stanley; 1989-1993 all other China Region countries:
Emerging Stock Market Fact Book 1995, International
Finance Corp.; Hong Kong and Singapore 1994: Morgan
Stanley.

* Not available.

The following table shows changes in the exchange
rate of the currency of each China Region country
relative to the U.S. dollar for the years ended
December 31, 1990-1994.
CURRENCY MOVEMENTS VERSUS US DOLLAR (%
CHANGE)

YEAR ENDED DECEMBER 31,
--------------------------------------------------
- ------ 1990 1991 1992
1993 1994 ------ ----- --
- ---- ------ ----- Hong Kong 0.10%
0.30% 0.50% 0.20% 0% Korea
- -5.19% -5.83% -3.77% -2.44% -6.13%
Singapore 9.20% 7.40% -1.20% 2.30% 10.2%
Taiwan -2.18% 4.43% 1.31% -4.51%
- -2.73% Thailand 1.20% 1.00% -1.70%
- -0.20% -1.47% Malaysia 0.01% -0.82%
4.03% -2.90% -3.38% Indonesia -4.87%
- -4.79% -3.85% -1.88% 4.51% Philippines
- -19.96% 4.02% 2.15% -5.19% -9.62% China
(Official) -9.80% -3.10% -7.50% -0.90% 4.51%
China (SWAP) 3.70% -4.10% -19.80% -11.50% *%

Sources: China Region countries, except Hong Kong and
Singapore: Emerging Stock Market Fact Book 1995,
International Finance Corp.; Hong Kong, Singapore and
China, 1988-1992: Baring Securities, Pacific Rim Stock
Market Review, July 1993; 1993 Hong Kong and Singapore:
Jardine Fleming; 1993 China: Mees Pierson Securities,
Inc.; 1994 Hong Kong and Singapore: Morgan Stanley.

* Dual exchange rates were eliminated in 1994.

PART C. OTHER INFORMATION

Item 24: Financial Statements and Exhibits

(a) Financial Statements:

- Included in Part A: Not applicable.

- Included in Part B: Statement of Assets
and Liabilities as of December 10, 1996
and Related Notes

(b) Exhibits:

1. (a) Amended and Restated Declaration of
Trust dated December 10, 1992 filed
with Post- Effective Amendment No.
71 to Registration Statement No.
2-17613 and incorporated by
reference herein.

(b) Amendment to Amended and Restated
Declaration of Trust filed with
Post-Effective Amendment No. 73 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(c) Amendment to Amended and Restated
Declaration of Trust filed with
Post-Effective Amendment No. 74 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(d) Establishment and Designation of
Additional Series (Ivy Emerging
Growth Fund) filed with Post-
Effective Amendment No. 73 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(e) Redesignation of Shares (Ivy Growth
with Income Fund--Class A) and
Establishment and Designation of
Additional Class (Ivy Growth with
Income Fund--Class C) filed with Post-
Effective Amendment No. 73 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(f) Redesignation of Shares (Ivy
Emerging Growth Fund--Class A, Ivy
Growth Fund--Class A and Ivy
International Fund--Class A) filed with
Post-Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(g) Establishment and Designation of
Additional Series (Ivy China Region
Fund) filed with Post-Effective
Amendment No. 74 to

Registration Statement No. 2-17613
and incorporated by reference
herein.

(h) Establishment and Designation of
Additional Class (Ivy China Region
Fund--Class B, Ivy Emerging Growth
Fund--Class B, Ivy Growth Fund--
Class B, Ivy Growth with Income Fund--
Class B and Ivy International Fund--Class B)
filed with Post-Effective Amendment No. 74
for Registration Statement No. 2-17613 and
incorporated by reference herein.

(i) Establishment and Designation of
Additional Class (Ivy International
Fund--Class I) filed with Post-
Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(j) Establishment and Designation of
Series and Classes (Ivy Latin
American Strategy Fund-- Class A and
Class B, Ivy New Century Fund--
Class A and Class B) filed with Post-
Effective Amendment No. 75 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(k) Establishment and Designation of
Series and Classes (Ivy
International Bond Fund--Class A
and Class B) filed with Post-Effective
Amendment No. 76 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(l) Establishment and Designation of
Series and Classes (Ivy Bond Fund,
Ivy Canada Fund, Ivy Global Fund,
Ivy Short-Term U.S. Government
Securities Fund (now known as Ivy Short-Term
Bond Fund) -- Class A and Class B) filed with
Post-Effective Amendment No. 77 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(m) Redesignation of Ivy Short-Term
U.S. Government Securities Fund as
Ivy Short-Term Bond Fund filed with
Post-Effective Amendment No. 81 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(n) Redesignation of Shares (Ivy Money
Market Fund--Class A and Ivy Money
Market Fund-- Class B) filed with
Post-Effective Amendment No. 84 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(o) Form of Establishment and
Designation of Additional Class
(Ivy Bond Fund--Class C; Ivy Canada
Fund--Class C; Ivy China Region Fund--
Class C; Ivy Emerging Growth Fund--Class C;
Ivy Global Fund--Class C; Ivy Growth Fund--
Class C; Ivy Growth with Income Fund--Class
C; Ivy International Fund--Class C; Ivy
Latin America Strategy Fund--Class
C; Ivy International Bond Fund--
Class C; Ivy Money Market Fund--
Class C; Ivy New Century Fund--
Class C) filed with Post-Effective Amendment
No. 84 to Registration Statement No. 2-17613
and incorporated by reference herein.

(p) Establishment and Designation of
Series and Classes (Ivy Global
Science & Technology Fund--Class A,
Class B, Class C and Class I) filed
with Post-Effective Amendment No. 86 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(q) Establishment and designation of
Series and Classes (Ivy Global
Natural Resources Fund-- Class A,
Class B and Class C; Ivy Asia
Pacific Fund--Class A, Class B and Class C;
Ivy International Small Companies Fund--Class
A, Class B, Class C and Class I) filed with
this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

2. By-Laws, as amended and filed with Post-
Effective Amendment No. 48 to
Registration Statement No. 2- 17613 and
incorporated by reference herein.

3. Not Applicable

4. (a) Specimen Securities for Ivy Growth
Fund, Ivy Growth with Income Fund,
Ivy International Fund and Ivy
Money Market Fund filed with Post-
Effective Amendment No. 49 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(b) Specimen Security for Ivy Emerging
Growth Fund filed with Post-
Effective Amendment No. 70 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(c) Specimen Security for Ivy China
Region Fund filed with Post-
Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(d) Specimen Security for Ivy Latin
American Strategy Fund filed with
Post-Effective Amendment No. 75 to
Registration Statement No. 2-17613
and incorporated by reference
herein.

(e) Specimen Security for Ivy New
Century Fund filed with Post-
Effective Amendment No. 75 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(f) Specimen Security for Ivy
International Bond Fund filed with
Post-Effective Amendment No. 76 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(g) Specimen Securities for Ivy Bond
Fund, Ivy Canada Fund, Ivy Global
Fund, and Ivy Short- Term U.S.
Government Securities Fund filed
with Post-Effective Amendment No. 77 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

5. (a) Master Business Management and
Investment Advisory Agreement
between Ivy Fund and Ivy
Management, Inc. and Supplements for Ivy
Growth Fund, Ivy Growth with Income Fund, Ivy
International Fund and Ivy Money Market Fund
filed with Post-Effective Amendment No. 68
to Registration Statement No.
2-17613 and incorporated by
reference herein.

(b) Subadvisory Contract by and among
Ivy Fund, Ivy Management, Inc. and
Boston Overseas Investors, Inc.
filed with Post-Effective Amendment
No. 68 to Registration Statement
No. 2-17613 and incorporated by the reference
herein.

(c) Assignment Agreement relating to
Subadvisory Contract filed with
Post-Effective Amendment No. 74 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(d) Business Management and Investment
Advisory Agreement Supplement for
Ivy Emerging Growth Fund filed with
Post-Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(e) Business Management and Investment
Advisory Agreement Supplement for
Ivy China Region Fund filed with
Post-Effective Amendment No.

71 to Registration Statement No.
2-17613 and incorporated by
reference herein.

(f) Form of Business Management and
Investment Advisory Supplement for
Ivy Latin America Strategy Fund
filed with Post-Effective Amendment
No. 75 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(g) Form of Business Management and
Investment Advisory Agreement
Supplement for Ivy New Century Fund
filed with Post-Effective Amendment
No. 75 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(h) Form of Business Management and
Investment Advisory Agreement
Supplement for Ivy International
Bond Fund filed with Post- Effective
Amendment No. 76 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(i) Business Management and Investment
Advisory Agreement Supplement for
Ivy Bond Fund, Ivy Global Fund and
Ivy Short-Term U.S. Government
Securities Fund filed with Post-
Effective Amendment No. 81 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(j) Master Business Management
Agreement between Ivy Fund and Ivy
Management, Inc. filed with Post-
Effective Amendment No. 81 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(k) Form of Supplement to Master
Business Agreement between Ivy Fund
and Ivy Management, Inc. (Ivy
Canada Fund) filed with Post-
Effective Amendment No. 77 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(l) Form of Investment Advisory
Agreement between Ivy Fund and
Mackenzie Financial Corporation
filed with Post-Effective Amendment No. 77 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(m) Form of Supplement to Master
Business Management and Investment
Advisory Agreement between Ivy Fund
and Ivy Management, Inc.

(Ivy Global Science & Technology
Fund) filed with Post-Effective
Amendment No. 86 to Registration
Statement No. 2-17613 and
incorporated by reference herein.

(n) Form of Supplement to Master
Business Management and Investment
Advisory Agreement between Ivy Fund
and Ivy Management, Inc. (Ivy Asia
Pacific Fund and Ivy International
Small Companies Fund) filed with this Post-
Effective Amendment No. 89 to Registration
Statement No. 2-17613.

(o) Form of Supplement to Master
Business Management Agreement
between Ivy Fund and Ivy
Management, Inc. (Ivy Global Natural
Resources Fund) filed with this Post-
Effective Amendment No. 89 to Registration
Statement No. 2-17613.

(p) Form of Supplement to Investment
Advisory Agreement between Ivy Fund
and Mackenzie Financial Corporation
(Ivy Global Natural Resources Fund)
filed with this Post- Effective
Amendment No. 89 to Registration
Statement No. 2-17613.

6. (a) Dealer Agreement, as amended and
filed with Post-Effective Amendment
No. 70 to Registration Statement
No. 2-17613 and incorporated by
reference herein.

(b) Amended and Restated Distribution
Agreement filed with Post-Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and
incorporated by reference herein.

(c) Addendum to Amended and Restated
Distribution Agreement filed with
Post-Effective Amendment No. 73 to
Registration Statement No. 2-17613
and incorporated by reference herein.

(d) Addendum to Amended and Restated
Distribution Agreement (Ivy Money
Market Fund--Class A and Class B)
filed with Post-Effective Amendment
No. 84 to Registration Statement No. 2-17613
and incorporated by reference herein.

(e) Form of Addendum to Amended and
Restated Distribution Agreement
(Class C) filed with Post-Effective
Amendment No. 84 to Registration
Statement No. 2-17613 and
incorporated by reference herein.

(f) Form of Addendum to Amended and
Restated Distribution Agreement
(Ivy Global Science & Technology
Fund--Class A, Class B, Class C and
Class I) filed with Post-Effective
Amendment No. 86 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(g) Form of Addendum to Amended and
Restated Distribution Agreement
(Ivy Global Natural Resources Fund-
- -Class A, Class B and Class C; Ivy
Asia Pacific Fund--Class A, Class B and
Class C; Ivy International Small Companies
Fund--Class A, Class B, Class C, and Class I)
filed with this Post-Effective Amendment No.
89 to Registration Statement No.
2-17613.

7. Not Applicable

8. Custodian Agreement between Ivy Fund and
Brown Brothers Harriman & Co. filed with
Post-Effective Amendment No. 74 to
Registration No. 2-17613 and
incorporated by reference herein.

9. (a) Master Administrative Services
Agreement between Ivy Fund and
Mackenzie Investment Management
Inc. and Supplements for Ivy Growth
Fund, Ivy Growth with Income Fund, Ivy
International Fund and Ivy Money Market Fund
filed with Post-Effective Amendment No. 68 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(b) Addendum to Administrative Services
Agreement Supplement for Ivy
International Fund filed with Post-
Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(c) Administrative Services Agreement
Supplement for Ivy Emerging Growth
Fund filed with Post- Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and incorporated by
reference herein.
(d) Administrative Services Agreement
Supplement for Ivy China Region
Fund filed with Post- Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(e) Administrative Services Agreement
Supplement for Class I Shares of
Ivy International Fund filed with
Post-Effective Amendment No. 74 to

Registration Statement No. 2-17613
and incorporated by reference
herein.

(f) Master Fund Accounting Services
Agreement between Ivy Fund and
Mackenzie Investment Management
Inc. and Supplements for Ivy Growth
Fund, Ivy Emerging Growth Fund and Ivy
Money Market Fund filed with Post-Effective
Amendment No. 73 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(g) Fund Accounting Services Agreement
Supplement for Ivy Growth with
Income Fund filed with Post-
Effective Amendment No. 73 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(h) Fund Accounting Services Agreement
Supplement for Ivy China Region
Fund filed with Post- Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(i) Transfer Agency and Shareholder
Services Agreement between Ivy Fund
and Ivy Management, Inc. filed with
Post-Effective Amendment No. 71 to
Registration Statement No. 2-17613
and incorporated by reference
herein.

(j) Addendum to Transfer Agency and
Shareholder Services Agreement
filed with Post-Effective Amendment
No. 73 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(k) Assignment Agreement relating to
Transfer Agency and Shareholder
Services Agreement filed with Post-
Effective Amendment No. 74 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(l) Form of Administrative Services
Agreement Supplement for Ivy Latin
America Strategy Fund filed with
Post-Effective Amendment No. 75 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(m) Form of Administrative Services
Agreement Supplement for Ivy New
Century Fund filed with Post-
Effective Amendment No. 75 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(n) Form of Fund Accounting Services
Agreement Supplement for Ivy Latin
America Strategy Fund filed with
Post-Effective Amendment No. 75 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(o) Form of Fund Accounting Services
Agreement Supplement for Ivy New
Century Fund filed with Post-
Effective Amendment No. 75 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(p) Form of Administrative Services
Agreement Supplement for Ivy
International Bond Fund filed with
Post-Effective Amendment No. 76 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(q) Form of Fund Accounting Services
Agreement Supplement for
International Bond Fund filed with
Post-Effective Amendment No. 76 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(r) Addendum to Transfer Agency and
Shareholder Services Agreement
filed with Post-Effective Amendment
No. 76 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(s) Addendum to Transfer Agency and
Shareholder Services Agreement
filed with Post-Effective Amendment
No. 77 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(t) Administrative Services Agreement
Supplement for Ivy Bond Fund, Ivy
Global Fund and Ivy Short-Term U.S.
Government Securities Fund filed
with Post-Effective Amendment No. 81 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(u) Fund Accounting Services Agreement
Supplement for Ivy Bond Fund, Ivy
Global Fund and Ivy Short-Term U.S.
Government Securities Fund filed
with Post-Effective Amendment No. 81 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(v) Form of Administrative Services
Agreement Supplement for Ivy Bond
Fund, Ivy Canada Fund, Ivy China
Region Fund, Ivy Emerging Growth
Fund, Ivy Global Fund, Ivy Growth

Fund, Ivy Growth with Income Fund,
Ivy International Fund, Ivy
International Bond Fund, Ivy Latin
America Strategy Fund, Ivy Money
Market Fund and Ivy New Century Fund
filed with Post-Effective Amendment No. 84 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(w) Form of Addendum to Transfer Agency
and Shareholder Services Agreement
filed with Post-Effective Amendment
No. 84 to Registration Statement
No. 2-17613 and incorporated by
reference herein.

(x) Form of Administrative Services
Agreement Supplement for Ivy Global
Science & Technology Fund filed
with Post-Effective Amendment No.
86 to Registration Statement No.
2-17613 and incorporated by reference
herein.

(y) Form of Fund Accounting Services
Agreement Supplement for Ivy Global
Science & Technology Fund filed
with Post-Effective Amendment No.
86 to Registration Statement No.
2-17613 and incorporated by reference
herein.

(z) Form of Addendum to Transfer Agency
and Shareholder Services Agreement
for Ivy Global Science & Technology
Fund filed with Post- Effective
Amendment No. 86 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(aa) Form of Administrative Services
Agreement Supplement for Ivy Global
Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International
Small Companies Fund filed with
this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

(bb) Form of Fund Accounting Services
Agreement Supplement for Ivy Global
Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International
Small Companies Fund filed with
this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

(cc) Form of Addendum to Transfer Agency
and Shareholder Services Agreement
for Ivy Global Natural Resources
Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund

filed with this Post-Effective
Amendment No. 89 to Registration
Statement No. 2-17613.

10. Opinion and Consent of Dechert Price &
Rhoads, filed herewith.

11. Consent of Coopers & Lybrand L.L.P.

12. Report of Coopers & Lybrand L.L.P.

13. Not applicable

14. Not applicable

15. (a) Amended and Restated Distribution
Plan for Class A shares of Ivy
China Region Fund, Ivy Growth Fund,
Ivy Growth with Income Fund, Ivy
International Fund and Ivy Emerging Growth
Fund filed with Post-Effective Amendment No.
73 to Registration Statement No. 2-17613 and
incorporated by reference herein.

(b) Distribution Plan for Class B
shares of Ivy China Region Fund,
Ivy Growth Fund, Ivy Growth with
Income Fund, Ivy International Fund
and Ivy Emerging Growth Fund filed with
Post-Effective Amendment No. 73 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(c) Distribution Plan for Class C
Shares of Ivy Growth with Income
Fund filed with Post- Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and incorporated by
reference herein.

(d) Form of Rule 12b-1 Related
Agreement filed with Post-Effective
Amendment No. 73 to Registration
Statement No. 2-17613 and
incorporated by reference herein.

(e) Supplement to Master Amended and
Restated Distribution Plan for Ivy
Fund Class A Shares filed with
Post-Effective Amendment No. 76 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(f) Supplement to Distribution Plan for
Ivy Fund Class B Shares filed with
Post-Effective Amendment No. 76 to
Registration Statement No. 2-17613
and incorporated by reference
herein.

(g) Supplement to Master Amended and
Restated Distribution Plan for Ivy
Fund Class A Shares filed with
Post-Effective Amendment No. 77 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(h) Supplement to Distribution Plan for
Ivy Fund Class B Shares filed with
Post-Effective Amendment No. 77 to
Registration Statement No. 2-17613
and incorporated by reference
herein.

(i) Form of Supplement to Distribution
Plan for Ivy Growth with Income
Fund Class C Shares (Redesignation
as Class D Shares) filed with Post-
Effective Amendment No. 84 to
Registration Statement No. 2-17613 and
incorporated by reference herein.

(j) Form of Distribution Plan for Class
C shares of Ivy Bond Fund, Ivy
Canada Fund, Ivy China Region Fund,
Ivy Emerging Growth Fund, Ivy
Global Fund, Ivy Growth Fund, Ivy Growth with
Income Fund, Ivy International Fund, Ivy
International Bond Fund, Ivy Latin America
Strategy Fund and Ivy New Century Fund filed
with Post-Effective Amendment No. 85
to Registration Statement No.
2-17613 and incorporated by
reference herein.

(k) Form of Supplement to Master
Amended and Restated Distribution
Plan for Ivy Fund Class A Shares
(Ivy Global Science & Technology
Fund), filed with Post-Effective Amendment
No. 87 to Registration Statement No. 2-17613
and incorporated by reference herein.

(l) Form of Supplement to Distribution
Plan for Ivy Fund Class B Shares
(Ivy Global Science & Technology
Fund), filed with Post-Effective
Amendment No. 87 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(m) Form of Supplement to Distribution
Plan for Ivy Fund Class C Shares
(Ivy Global Science & Technology
Fund), filed with Post-Effective
Amendment No. 87 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(n) Form of Supplement to Master
Amended and Restated Distribution
Plan for Ivy Fund Class A Shares
(Ivy Global Natural Resources Fund,

Ivy Asia Pacific Fund and Ivy
International Small Companies
Fund), filed with this Post-
Effective Amendment No. 89 to Registration
Statement No. 2-17613.

(o) Form of Supplement to Distribution
Plan for Ivy Fund Class B Shares
(Ivy Global Natural Resources
Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund), filed
with this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

(p) Form of Supplement to Distribution
Plan for Ivy Fund Class C Shares
(Ivy Global Natural Resources Fund,
Ivy Asia Pacific Fund and Ivy
International Small Companies Fund), filed
with this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

16. Schedule of Computation of Standardized
Performance Quotations filed with Post-
Effective Amendment No. 71 to
Registration Statement No. 2- 17613 and
incorporated by reference herein.

17. Not applicable.

18. (a) Plan adopted pursuant to Rule 18f-3
under the Investment Company Act of
1940 filed with Post-Effective
Amendment No. 83 to Registration
Statement No. 2-17613 and
incorporated by reference herein.

(b) Form of Amended and Restated Plan
adopted pursuant to Rule 18f-3
under the Investment Company Act of
1940 filed with Post-Effective
Amendment No. 85 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(c) Form of Amended and Restated Plan
adopted pursuant to Rule 18f-3
under the Investment Company Act of
1940 filed with Post-Effective
Amendment No. 87 to Registration Statement
No. 2-17613 and incorporated by reference
herein.

(d) Form of Amended and Restated Plan
adopted pursuant to Rule 18f-3
under the Investment Company Act of
1940 filed with this Post- Effective
Amendment No. 89 to Registration
Statement No. 2-17613.

25. Persons Controlled by or Under Common Control with
Registrant: Not applicable

26. Number of Holders of Securities

Fund: Date Class Record
Holders

Ivy Bond Fund 11/30/96 Class A 4,720
Class B 203
Class C 39
Class I 0

Ivy Canada Fund 11/30/96 Class A 2,297
Class B 147
Class C 44

Ivy China Region 11/30/96 Class A 2,132
Class B 1,113
Class C 21

Ivy Emerging 11/30/96 Class A 4,887
Growth Fund Class B 3,068
Class C 179

Ivy Global Fund 11/30/96 Class A 1,469
Class B 562
Class C 4

Ivy Global Science 11/30/96 Class A 304
& Technology Fund Class B 218
Class C 78
Class I 0

Ivy Growth Fund 11/30/96 Class A 30,412
Class B 300
Class C 6

Ivy Growth with 11/30/96 Class A 6,002
Income Fund Class B 1,016
Class C 5
Class D 41

Ivy International 11/30/96 Class A 20,651
Fund Class B 13,084
Class C 764
Class I 292

Ivy International 11/30/96 Class A 0
Bond Fund Class B 0
Class C 0

Ivy Latin America 11/30/96 Class A 307
Strategy Fund Class B 132
Class C 2

Ivy Money Market 11/30/96 Class A 2,492
Fund Class B 108

Class C 6

Ivy New Century 11/30/96 Class A 797
Fund Class B 436
Class C 86

Ivy Short-Term 11/30/96 Class A 0
Bond Fund Class B 0
Class I 0

27. Indemnification

The information required by this item is
incorporated by reference to Item 27 of Part C of
Post-Effective Amendment No. 48 to Registrant's
Registration Statement on Form N-1A under the
Securities Act of 1933 (File No. 2-17613).
Mackenzie Investment Management Inc. ("Mackenzie") has
agreed to indemnify certain disinterested Trustees of the
Fund for legal fees and court costs, not exceeding
$250,000 in the aggregate, except to the extent
that indemnification is otherwise provided by the
Fund or such fees or costs are covered by
insurance. Mackenzie is not obligated to
indemnify any such Trustee if he is finally adjudicated by
the SEC or any court to have acted in bad faith or with
gross negligence or willful misconduct with respect to
any Board action in connection with Mackenzie's
purchase of all of the outstanding capital stock
of Ivy Management, Inc. Mackenzie has also agreed
to indemnify the selling shareholders, consisting
of William M. Watson and a company controlled by
Michael R. Peers (Trustees and Officers of Ivy
Fund), against a variety of matters with respect to the sale
of such stock to Mackenzie.

28. Business and Other Connections of Investment
Adviser

Information Regarding Adviser and Subadviser Under
Advisory Arrangements. Reference is made to the
Form ADV of each of Ivy Management, Inc., the
adviser to the Trust, Mackenzie Financial
Corporation, the adviser to Ivy Canada Fund, and
Northern Cross Investments Limited (the successor to Boston
Overseas Investors, Inc.), the subadviser to Ivy
International Fund.

The list required by this Item 28 of officers and
directors of Ivy Management, Inc. and Northern
Cross Investments Limited, together with
information as to any other business profession,
vocation or employment of a substantial nature
engaged in by such officers and directors during the past
two years, is incorporated by reference to Schedules A and
D of each firm's respective Form ADV.

29. Principal Underwriters

(a) Ivy Mackenzie Distribution, Inc. ("IMDI"),
formerly Mackenzie Ivy Funds Distribution,
Inc., Via Mizner Financial Plaza, 700 South
Federal Highway, Suite 300, Boca Raton,
Florida 33432, Registrant's distributor, is a
subsidiary of Mackenzie Investment Management Inc.
("MIMI"), Via Mizner Financial Plaza, 700 South Federal
Highway, Suite 300, Boca Raton, Florida 33432. IMDI
also serves as the distributor for Mackenzie
Series Trust. IMDI is the successor to
MIMI's distribution activities.

(b) The information required by this Item 29
regarding each director, officer or partner
of IMDI is incorporated by reference to
Schedule A of Form BD filed by IMDI pursuant
to the Securities Exchange Act of 1934.

30. Location of Accounts and Records

The information required by this item is
incorporated by reference to Item 7 of Part II of
Post-Effective Amendment No. 46 to Registration
Statement No. 2-17613.

31. Not applicable

32. Undertakings

(a) Not applicable

(b) Registrant undertakes to file a Post-
Effective Amendment, using reasonably current
financial statements of Ivy Asia Pacific
Fund, Ivy Global Natural Resources Fund and
Ivy International Small Companies Fund,
within four to six months from the effective date
of this Post-Effective Amendment No. 89 to Registrant's
Registration Statement under the Securities Act of
1933.

(c) Registrant undertakes to furnish each person
to whom a prospectus is delivered with a copy
of Registrant's latest annual report to
shareholders, upon request and without
charge.

SIGNATURES

Pursuant to the requirements of the Securities Act
of 1933 and the Investment Company Act of 1940, the
Registrant certifies that it meets all of the
requirements for effectiveness of this Post-Effective
Amendment No. 89 to its Registration Statement pursuant
to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Post-Effective Amendment No. 89 to its
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Boston, in
the Commonwealth of Massachusetts, on the 23rd day of
December, 1996.

IVY FUND

By: MICHAEL G.
LANDRY*
President *By: JOSEPH R. FLEMING
Attorney-in-fact

Pursuant to the requirements of the Securities Act
of 1933, this Post-Effective Amendment No. 89 to the
Registration Statement has been signed below by the
following persons in the capacities and on the dates
indicated.

SIGNATURES TITLE
DATE

MICHAEL G. LANDRY* Trustee and
12/23/96 President (Chief

Executive Officer)

JOHN S. ANDEREGG, JR.* Trustee
12/23/96

PAUL H. BROYHILL* Trustee
12/23/96

STANLEY CHANNICK* Trustee
12/23/96

FRANK W. DEFRIECE, JR.* Trustee
12/23/96

ROY J. GLAUBER* Trustee
12/23/96

KEITH J. CARLSON** Trustee
12/23/96

JOSEPH G. ROSENTHAL* Trustee
12/23/96

RICHARD N. SILVERMAN* Trustee
12/23/96

J. BRENDAN SWAN* Trustee
12/23/96

C. WILLIAM FERRIS* Treasurer (Chief
12/23/96 Financial
Officer)

*By: JOSEPH R. FLEMING
Attorney-in-fact

* Executed pursuant to powers of attorney filed with
Post-Effective Amendments Nos. 69, 73, 74 and 84 to
Registration Statement No. 2-17613.

** Executed pursuant to power of attorney filed with
this Post-Effective Amendment No. 89 to
Registration Statement No. 2-17613.

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that the
undersigned constitutes and appoints each of Joseph R.
Fleming, Sheldon A. Jones and Allan S. Mostoff his true
and lawful attorney-in-fact and agent, each with full
power of substitution and resubstitution for him in his
name, place and stead, to sign any and all Registration
Statements on Form N-1A applicable to Ivy Fund and any
amendments or supplements thereto, and to file the
same, with all exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission,
granting unto said attorney-in-fact and agent full
power and authority to do and perform each and every
act and thing requisite and necessary to be done, as
fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that
said attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue
hereof.

IN WITNESS WHEREOF, the undersigned has subscribed to
these presents this 7th day of December, 1996.

SIGNATURE TITLE

KEITH J. CARLSON Trustee

EXHIBIT INDEX

1(q) Establishment and Designation of Series and
Classes (Ivy Global Natural Resources Fund--
Class A, Class B and Class C; Ivy Asia
Pacific Fund--Class A, Class B and Class C;
Ivy International Value Fund--Class A, Class
B, Class C and Class I)

5(n) Form of Supplement to Master Business
Management and Investment Advisory Agreement
between Ivy Fund and Ivy Management, Inc.
(Ivy Asia Pacific Fund and Ivy International
Value Fund)

5(o) Form of Supplement to Master Business
Management Agreement between Ivy Fund and Ivy
Management, Inc. (Ivy Global Natural
Resources Fund)

5(p) Form of Supplement to Investment Advisory
Agreement between Ivy Fund and Mackenzie
Financial Corporation (Ivy Global Natural
Resources Fund)

6(g) Form of Addendum to Amended and Restated
Distribution Agreement (Ivy Global Natural
Resources Fund--Class A, Class B and Class C;
Ivy Asia Pacific Fund--Class A, Class B and
Class C; Ivy International Value Fund-- Class
A, Class B, Class C and Class I)

9(aa) Form of Administrative Services Agreement
Supplement for Ivy Global Natural Resources
Fund, Ivy Asia Pacific Fund and Ivy
International Value Fund

9(bb) Form of Fund Accounting Services Agreement
Supplement for Ivy Global Natural Resources
Fund, Ivy Asia Pacific Fund and Ivy
International Value Fund

9(cc) Form of Addendum to Transfer Agency and
Shareholder Services Agreement for Ivy Global
Natural Resources Fund, Ivy Asia Pacific Fund
and Ivy International Value Fund

10 Opinion and Consent of Dechert Price & Rhoads

11 Consent of Coopers & Lybrand L.L.P.

12 Report of Coopers & Lybrand L.L.P.

15(n) Form of Supplement to Master Amended and
Restated Distribution Plan For Ivy Fund Class
A Shares (Ivy Global Natural Resources, Ivy
Asia Pacific Fund and Ivy International Value
Fund)

15(o) Form of Supplement to Distribution Plan For
Ivy Fund Class B Shares (Ivy Global Natural
Resources Fund, Ivy Asia Pacific Fund and Ivy
International Value Fund)

15(p) Form of Supplement to Distribution Plan For
Ivy Fund Class C Shares (Ivy Global Natural
Resources Fund, Ivy Asia Pacific Fund and Ivy
International Value Fund)

18(d) Form of Amended and Restated Plan adopted
pursuant to Rule 18f-3 under the Investment
Company Act of 1940

EXHIBIT 1(q)

IVY FUND

Ivy Global Natural Resources Fund
Ivy Asia Pacific Fund
Ivy International Small Companies Fund

Establishment and Designation of Additional
Series of Shares of Beneficial Interest,
No Par Value Per Share

I, Michael G. Landry, being a duly elected, qualified and
acting Trustee of Ivy Fund (the "Trust"), a business trust formed
under the laws of the Commonwealth of Massachusetts, DO HEREBY
CERTIFY that, by written consent dated [-], the Trustees of the
Trust (the "Trustees"), pursuant to Article III of the Agreement
and Declaration of Trust of the Trust dated December 21, 1983, as
amended and restated December 10, 1992 (the "Declaration of
Trust"), duly approved, adopted and consented to the following
resolutions as actions of the Trustees of the Trust:

RESOLVED, that (i) the shares of beneficial interest of the Trust
having previously been divided into fourteen separate series,
designated as Ivy Bond Fund, Ivy Canada Fund, Ivy China Region
Fund, Ivy Emerging Growth Fund, Ivy Global Fund, Ivy Growth Fund,
Ivy Growth with Income Fund, Ivy International Fund, Ivy
International Bond Fund, Ivy Latin America Strategy Fund, Ivy
Money Market Fund, Ivy New Century Fund, Ivy Short-Term Bond Fund
and Ivy Global Science & Technology Fund, the shares of
beneficial interest of the Trust shall hereby be divided into
three additional separate series designated as "Ivy Global
Natural Resources Fund," "Ivy Asia Pacific Fund" and "Ivy
International Small Companies Fund" (each, a "Fund," collectively
the "Funds," and collectively with the other fourteen series of
the Trust, the "Series"); and (ii) having established and
designated the Funds as additional Series of the Trust, there
shall hereby be designated an unlimited number of authorized and
unissued shares of beneficial interest of the Trust as (a) "Ivy
Global Natural Resources Fund--Class A," (b) "Ivy Global Natural
Resources Fund--Class B," (c) "Ivy Global Natural Resources Fund-
-Class C," (d) "Ivy Asia Pacific Fund--Class A," (e) "Ivy Asia
Pacific Fund--Class B," (f) "Ivy Asia Pacific Fund--Class C," (g)
"Ivy International Small Companies Fund--Class A," (h) "Ivy
International Small Companies Fund--Class B," (i) "Ivy
International Small Companies Fund--Class C" and (j) "Ivy
International Small Companies Fund--Class I," with the Funds and
each of their classes of shares being subject to all provisions
of the Declaration of Trust relating to shares of the Trust
generally, and having the following special and relative rights:

1. Each Fund shall be authorized to hold cash and invest
in securities and instruments and use investment
techniques as described in the Trust's registration
statement under the Securities Act of 1933, as amended
from time to time. Each share of beneficial interest,
no par value per share, of a Fund ("share") shall be
redeemable as provided in the Declaration of Trust,
shall be entitled to one vote (or fraction thereof in
respect of a fractional share) on matters on which
shares of that Fund shall be entitled to vote and shall
represent a pro rata beneficial interest in the assets
allocated to that Fund. The proceeds of sales of
shares of a Fund, together with any income and gain
thereon, less any diminution or expenses thereof, shall
irrevocably belong to that Fund, unless otherwise
required by law. Each share of a Fund shall be
entitled to receive its pro rata share of net assets of
that Fund upon liquidation of that Fund. Upon
redemption of a shareholder's shares, or
indemnification for liabilities incurred by reason of a
shareholder being or having been a shareholder of a
Fund, such shareholder shall be paid solely out of the
property of that Fund.

2. Shareholders of each Fund shall vote separately as a
Series on any matter to the extent required by
applicable federal or state law. Shareholders of each
class of a Fund shall have (i) exclusive voting rights
with respect to matters on which the holders of each
such class shall be entitled to exclusive voting rights
under applicable federal or state law, and (ii) no
voting rights with respect to matters on which the
holders of another class of shares of that Fund or the
holders of another Series (or class thereof) shall be
entitled to exclusive voting rights under applicable
federal or state law.

3. The assets and liabilities of the Trust existing as of
the end of the day immediately preceding the date on
which the Registration Statement for the Funds becomes
effective shall be allocated among the Series other
than the Funds in accordance with Article III of the
Declaration of Trust, and thereafter the assets and
liabilities of the Trust shall be allocated among all
Series and classes thereof in accordance with Article
III of the Declaration of Trust, except as provided
below:

(a) Costs incurred by the Trust on behalf of a Fund in
connection with the organization, registration and
public offering of shares of that Fund shall be
allocated to that Fund and shall be amortized by
that Fund in accordance with applicable law and
generally accepted accounting principles.

(b) The Trustees may from time to time in particular
cases make specific allocations of assets or
liabilities among the Series.

4. The Trustees (including any successor Trustees) shall
have the right at any time and from time to time to
reallocate assets and expenses or to change the
designation of any Series (or class thereof) now or
hereafter created, or to otherwise change the special
and relative rights of any such Series (or class),
provided that such change shall not adversely affect
the rights of shareholders of that Series (or class).

5. The dividends and distributions with respect to each
class of shares shall be in such amount as may be
declared from time to time by the Trust's Board of
Trustees in accordance with the Declaration of Trust
and applicable law.

6. (a) Each Class B share of a Fund, other than a share
purchased through the automatic reinvestment of a
dividend or a distribution with respect to Class B
shares, shall be converted automatically, and
without any action or choice on the part of the
holder thereof, into and be reclassified as a
Class A share of that Fund on the date that is the
first business day following the last calendar day
of the month in which the eighth anniversary date
of the date of the issuance of such Class B share
falls (the "Conversion Date") on the basis of the
relative net asset values of the two classes,
without the imposition of any sales load, fee or
other charge;

(b) Each Class B share purchased through the automatic
reinvestment of a dividend or a distribution with
respect to Class B shares shall be segregated in a
separate sub-account. Each time any Class B
shares of a Fund in a shareholder's Fund account
(other than those in the sub-account) convert to
Class A shares of that Fund, a pro rata portion of
the Class B shares then in the sub-account will
also convert to Class A shares. The portion will
be determined by the ratio that the shareholder's
Class B shares converting to Class A shares bears
to the shareholder's total Class B shares not
acquired through the reinvestment of dividends and
distributions;

(c) The conversion of Class B shares into Class A
shares may be suspended if (i) a ruling of the
Internal Revenue Service (the "IRS") to the effect
that the conversion of Class B shares does not
constitute a taxable event under Federal income

tax law is revoked or (ii) an opinion of counsel
on such tax matter is withdrawn or (iii) the Board
of Trustees determines that continuing such
conversions would have material, adverse tax
consequences for a Fund or its shareholders; and

(d) On the Conversion Date, the Class B shares
converted into Class A shares shall cease to
accrue dividends and shall no longer be deemed
outstanding and the rights of the holders thereof
(except the right to receive the number of Class A
shares into which the Class B shares have been
converted and any declared but unpaid dividends to
the Conversion Date) shall cease. Certificates
representing Class A shares of a Fund resulting
from the conversion of Class B shares need not be
issued until certificates representing the Class B
shares converted, if issued, have been received by
the Trust or its agent duly endorsed for transfer.

FURTHER RESOLVED, that the preceding resolutions shall
constitute an Amendment to the Declaration of Trust,
effective as of the date that the Registration Statement for
the Funds is filed with the Securities and Exchange
Commission in accordance with Rule 485(a)(2) under the
Securities Act of 1933.

IN WITNESS WHEREOF, I have signed this Amendment this _____
day of [-], 1996.

_____________________________________
Michael G. Landry, as Trustee

The above signature is the true and correct signature of
Michael G. Landry, Trustee of the Trust.

_____________________________________
C. William Ferris, Secretary/Treasurer
Mackenzie Investment Management Inc.

EXHIBIT 5(n)

IVY FUND

MASTER BUSINESS MANAGEMENT AND INVESTMENT ADVISORY
AGREEMENT SUPPLEMENT

Ivy Asia Pacific Fund
Ivy International Small Companies Fund

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Ivy Management, Inc. (the
"Manager").

WHEREAS, the Trust is an open-end investment company,
organized as a Massachusetts business trust, and consists of such
separate investment portfolios as have been or may be established
and designated by the Trustees of the Trust from time to time;

WHEREAS, a separate class of shares of the Trust is offered
to investors with respect to each investment portfolio;

WHEREAS, the Trust has adopted a Master Business Management
and Investment Advisory Agreement dated December 31, 1991 (the
"Master Agreement"), pursuant to which the Trust has appointed
the Manager to provide the business management and investment
advisory services specified in that Master Agreement; and

WHEREAS, Ivy Asia Pacific Fund and Ivy International Small
Companies Fund (each, a "Fund" and collectively the "Funds") are
separate investment portfolios of the Trust.

NOW, THEREFORE, the Trustees of the Trust hereby take the
following actions, subject to the conditions set forth:

1. As provided for in the Master Agreement, the Trust
hereby adopts the Master Agreement with respect to the Funds, and
the Manager hereby acknowledges that the Master Agreement shall
pertain to the Funds, the terms and conditions of such Master
Agreement being hereby incorporated herein by reference.

2. The term "Portfolio" as used in the Master Agreement
shall, for purposes of this Supplement, pertain to each Fund.

3. As provided in the Master Agreement and subject to
further conditions as set forth therein, each Fund shall pay the
Manager a monthly fee on the first business day of each month
based upon the average daily value (as determined on each
business day at the time set forth in the Prospectus of each Fund
for determining net asset value per share) of the net assets of
that Fund during the preceding month at the annual rate of 1.00%.

4. This Supplement and the Master Agreement (together, the
"Agreement") shall become effective with respect to each of the
Funds as of the date specified above, and unless sooner
terminated as hereinafter provided, the Agreement shall remain in
effect with respect to a Fund for a period of more than two (2)
years from such date only so long as the continuance is
specifically approved at least annually (a) by the vote of a
majority of the outstanding voting securities of that Fund (as
defined in the Investment Company Act of 1940, as amended (the
"1940 Act")) or by the Trust's entire Board of Trustees and (b)
by the vote, cast in person at a meeting called for that purpose,
of a majority of the Trust's Independent Trustees. This
Agreement may be terminated with respect to a Fund at any time,
without payment of any penalty, by vote of a majority of the
outstanding voting securities of that Fund (as defined in the
1940 Act) or by vote of a majority of the Trust's entire Board of
Trustees on sixty (60) days' written notice to the Manager or by
the Manager on sixty (60) days' written notice to the Trust.
This Agreement shall terminate automatically in the event of its
assignment (as defined in the 1940 Act).

IVY FUND, on behalf of
Ivy Asia Pacific Fund and
Ivy International Small Companies Fund

By: _____________________________
Michael G. Landry, President

IVY MANAGEMENT, INC.

By: _____________________________
Michael G. Landry, President

EXHIBIT 5(o)

IVY FUND

MASTER BUSINESS MANAGEMENT AGREEMENT SUPPLEMENT

Ivy Global Natural Resources Fund

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Ivy Management, Inc. (the
"Manager").

WHEREAS, a separate class of shares of the Trust is offered
to investors with respect to each investment portfolio;

WHEREAS, the Trust has adopted a Master Business Management
Agreement dated December 31, 1994 (the "Master Agreement"),
pursuant to which the Trust has appointed the Manager to provide
the business management services specified in that Master
Agreement; and

WHEREAS, Ivy Global Natural Resources Fund (the "Fund") is a
separate investment portfolio of the Trust.

NOW, THEREFORE, the Trustees of the Trust hereby take the
following actions, subject to the conditions set forth:

1. As provided for in the Master Agreement, the Trust
hereby adopts the Master Agreement with respect to the Fund, and
the Manager hereby acknowledges that the Master Agreement shall
pertain to the Fund, the terms and conditions of such Master
Agreement being hereby incorporated herein by reference.

2. The term "Fund" as used in the Master Agreement shall,
for purposes of this Supplement, pertain to the Fund.

3. As provided in the Master Agreement and subject to
further conditions as set forth therein, the Fund shall pay the
Manager a monthly fee on the first business day of each month
based upon the average daily value (as determined on each
business day at the time set forth in the Fund's Prospectus for
determining net asset value per share) of the Fund's net assets
during the preceding month at the annual rate of 0.50%.

4. This Supplement and the Master Agreement (together, the
"Agreement") shall become effective with respect to the Fund as
of the date specified above, and unless sooner terminated as
hereinafter provided, the Agreement shall remain in effect with

respect to the Fund for a period of more than two (2) years from
such date only so long as the continuance is specifically
approved at least annually (a) by the vote of a majority of the
outstanding voting securities of the Fund (as defined in the
Investment Company Act of 1940, as amended (the "1940 Act")) or
by the Trust's entire Board of Trustees and (b) by the vote, cast
in person at a meeting called for that purpose, of a majority of
the Trust's Independent Trustees. This Agreement may be
terminated with respect to the Fund at any time, without payment
of any penalty, by vote of a majority of the outstanding voting
securities of the Fund (as defined in the 1940 Act) or by vote of
a majority of the Trust's entire Board of Trustees on sixty (60)
days' written notice to the Manager or by the Manager on sixty
(60) days' written notice to the Trust. This Agreement shall
terminate automatically in the event of its assignment (as
defined in the 1940 Act).

IVY FUND, on behalf of
Ivy Global Natural Resources Fund,

By: _____________________________
Michael G. Landry, President

IVY MANAGEMENT, INC.

By: _____________________________
Michael G. Landry, President

EXHIBIT 5(p)

IVY FUND

INVESTMENT ADVISORY AGREEMENT SUPPLEMENT

Ivy Global Natural Resources Fund

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Mackenzie Financial
Corporation (the "Adviser").

WHEREAS, a separate class of shares of the Trust is offered
to investors with respect to each investment portfolio;

WHEREAS, the Trust has adopted an Investment Advisory
Agreement (the "Advisory Agreement") dated December 31, 1994,
pursuant to which the Trust has appointed the Adviser to provide
the investment advisory services specified in that Advisory
Agreement; and

WHEREAS, Ivy Global Natural Resources Fund (the "Fund") is a
separate investment portfolio of the Trust.

NOW, THEREFORE, the Trustees of the Trust hereby take the
following actions, subject to the conditions set forth:

1. As provided for in the Advisory Agreement, the Trust
hereby adopts the Advisory Agreement with respect to the Fund,
and the Adviser hereby acknowledges that the Advisory Agreement
shall pertain to the Fund, the terms and conditions of such
Advisory Agreement being hereby incorporated herein by reference.

2. The term "Portfolio" as used in the Advisory Agreement
shall, for purposes of this Supplement, pertain to the Fund.

3. As provided in the Advisory Agreement and subject to
further conditions as set forth therein, the Fund shall pay the
Adviser a monthly fee on the first business day of each month
based upon the average daily value (as determined on each
business day at the time set forth in the Fund's Prospectus for
determining net asset value per share) of the Fund's net assets
during the preceding month at the annual rate of 0.50%.

4. This Supplement and the Advisory Agreement (together,
the "Agreement") shall become effective with respect to the Fund
as of the date specified above, and unless sooner terminated as
hereinafter provided, the Agreement shall remain in effect with

respect to the Fund for a period of more than two (2) years from
such date only so long as the continuance is specifically
approved at least annually (a) by the vote of a majority of the
outstanding voting securities of the Fund (as defined in the
Investment Company Act of 1940, as amended (the "1940 Act")) or
by the Trust's entire Board of Trustees and (b) by the vote, cast
in person at a meeting called for that purpose, of a majority of
the Trust's Independent Trustees. This Agreement may be
terminated with respect to the Fund at any time, without payment
of any penalty, by vote of a majority of the outstanding voting
securities of the Fund (as defined in the 1940 Act) or by vote of
a majority of the Trust's entire Board of Trustees on sixty (60)
days' written notice to the Adviser or by the Adviser on sixty
(60) days' written notice to the Trust. This Agreement shall
terminate automatically in the event of its assignment (as
defined in the 1940 Act).

IVY FUND, on behalf of
Ivy Global Natural Resources Fund,

By: _____________________________
Michael G. Landry, President

MACKENZIE FINANCIAL CORPORATION

By: _____________________________
Alexander Christ, President

EXHIBIT 6(g)
IVY FUND

ADDENDUM TO
AMENDED AND RESTATED DISTRIBUTION AGREEMENT

Ivy Global Natural Resources Fund,
Ivy Asia Pacific Fund and
Ivy International Small Companies Fund
Class A, Class B and Class C Shares

Ivy International Small Companies Fund
Class I Shares

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Ivy Mackenzie Distributors,
Inc. ("IMDI")(formerly "Mackenzie Ivy Funds Distribution, Inc.").

WHEREAS, the Trust is registered as an open-end investment
company under the Investment Company Act of 1940, as amended, and
consists of one or more separate investment portfolios, as may be
designated from time to time; and

WHEREAS, IMDI serves as the Trust's distributor pursuant to
an Amended and Restated Distribution Agreement dated October 23,
1993 (the "Agreement"); and

WHEREAS, the Trustees of the Trust, at a meeting held on
December 6 and 7, 1996, duly approved an amendment to the
Agreement to include the Class A, Class B and Class C shares of
Ivy Global Natural Resources Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund (the "Funds") and the Class I
shares of Ivy International Small Companies Fund (the "Shares").

WHEREAS, the Shares were established and designated by the
Board of Trustees of the Trust by written consent made effective
as of the date that the Registration Statement for the Funds was
filed with the Securities and Exchange Commission in accordance
with Rule 485(a)(2) under the Securities Act of 1933.

NOW THEREFORE, the Trust and IMDI hereby agree as follows:

Effective as of December 31, 1996, the
Agreement shall relate in all respects to the
Shares, in addition to the classes of shares
of the Funds and any other series of the
Trust specifically identified in Paragraph 1
of the Agreement and any other Addenda
thereto.

IN WITNESS WHEREOF, the Trust and IMDI have adopted this
Addendum as of the date first set forth above.

IVY FUND

By: _____________________________
Michael G. Landry, President

IVY MACKENZIE DISTRIBUTORS, INC.

By: _____________________________
Keith J. Carlson, President

EXHIBIT 9(aa)

IVY FUND

ADMINISTRATIVE SERVICES AGREEMENT SUPPLEMENT

Ivy Global Natural Resources Fund
Ivy Asia Pacific Fund
Ivy International Small Companies Fund

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Mackenzie Investment
Management Inc. ("MIMI").

WHEREAS, a separate series of shares of the Trust is offered
to investors with respect to each investment portfolio;

WHEREAS, the Trust has adopted a Master Administrative
Services Agreement dated September 1, 1992 (the "Master Services
Agreement"), pursuant to which the Trust has appointed MIMI to
provide the administrative services specified in the Master
Services Agreement; and

WHEREAS, Ivy Global Natural Resources Fund, Ivy Asia Pacific
Fund and Ivy International Small Companies Fund (each, a "Fund"
and collectively the "Funds") are separate investment portfolios
of the Trust.

NOW, THEREFORE, the Trustees of the Trust hereby take the
following actions, subject to the conditions set forth:

1. As provided for in the Master Services Agreement, the
Trust hereby adopts the Master Services Agreement with respect to
the Funds, and MIMI hereby acknowledges that the Master Services
Agreement shall pertain to the Funds, the terms and conditions of
such Master Services Agreement being incorporated herein by
reference.

2. The term "Fund" as used in the Master Services
Agreement shall, for purposes of this Supplement, pertain to each
Fund.

3. As provided in the Master Services Agreement and
subject to further conditions as set forth therein, each Fund
shall pay MIMI a monthly fee on the first business day of each
month based upon the average daily value (as determined on each
business day at the time set forth in each Fund's Prospectus for
determining net asset value per share) of the net assets of that

Fund during the preceding month at the annual rate of (i) 0.10%
with respect to that Fund's Class A, Class B and Class C shares,
and (ii) in the case of Ivy International Small Companies Fund,
0.01%, with respect to that Fund's Class I shares.

4. This Supplement and the Master Services Agreement
(together, the "Agreement") shall become effective with respect
to each of the Funds as of the date specified above, and unless
sooner terminated as hereinafter provided, the Agreement shall
remain in effect for a period of two years from that date.
Thereafter, the Agreement shall continue in effect with respect
to each Fund from year to year, provided such continuance with
respect to each Fund is approved at least annually by the Trust's
Board of Trustees, including the vote or written consent of a
majority of the Trust's Independent Trustees (as defined in the
Investment Company Act of 1940, as amended). This Agreement may
be terminated with respect to a Fund at any time, without payment
of any penalty, by MIMI upon at least sixty (60) days' prior
written notice to that Fund, or by a Fund upon at least sixty
(60) days' written notice to MIMI; provided, that in case of
termination by a Fund, such action shall have been authorized by
the Trust's Board of Trustees, including the vote or written
consent of a majority of the Trust's Independent Trustees.

IVY FUND, on behalf of
Ivy Global Natural Resources Fund,
Ivy Asia Pacific Fund and
Ivy International Small Companies Fund

By: _____________________________
Michael G. Landry, President

MACKENZIE INVESTMENT MANAGEMENT INC.

By: _____________________________
Michael G. Landry, President

EXHIBIT 9(bb)

IVY FUND

FUND ACCOUNTING SERVICES AGREEMENT SUPPLEMENT

Ivy Global Natural Resources Fund
Ivy Asia Pacific Fund
Ivy International Small Companies Fund

AGREEMENT made as of the 31st day of December, 1996, by and
between Ivy Fund (the "Trust") and Mackenzie Investment
Management Inc. (the "Agent").

WHEREAS, a separate class of shares of the Trust is offered
to investors with respect to each investment portfolio;

WHEREAS, the Trust has adopted a Master Fund Accounting
Services Agreement dated January 25, 1993 (the "Master
Agreement"), pursuant to which the Trust has appointed the Agent
to provide the fund accounting services specified in the Master
Agreement; and

NOW, THEREFORE, the Trustees of the Trust hereby take the
following actions, subject to the conditions set forth:

2. The term "Portfolio" as used in the Master Agreement
shall, for purposes of this Supplement, pertain to each Fund.

3. As provided in the Master Agreement and subject to
further conditions as set forth therein, each Fund shall pay the
Agent a monthly fee based upon the rate(s) set forth in the Fee
Schedule attached hereto as Annex 1.

4. This Supplement and the Master Agreement (together, the
"Agreement") shall become effective with respect to each of the
Funds as of the date specified above, and unless sooner

terminated as hereinafter provided, the Agreement shall remain in
effect with respect to a Fund for a period of more than one (1)
year from such date only so long as the continuance is
specifically approved at least annually by the Trust's Board of
Trustees, including the vote or written consent of a majority of
the Trust's Independent Trustees (as defined in the Investment
Company Act of 1940, as amended). This Agreement may be
terminated with respect to a Fund, without payment of any
penalty, by that Fund upon at least ninety (90) days' prior
written notice to the Agent or by the Agent upon at least ninety
(90) days' prior written notice to that Fund; provided, that in
the case of termination by a Fund, such action shall have been
authorized by the Trust's Board of Trustees, including the vote
or written consent of a majority of the Trust's Independent
Trustees.

IVY FUND, on behalf of
Ivy Global Natural Resources Fund,
Ivy Asia Pacific Fund and
Ivy International Small Companies Fund

By: ___________________________________
Michael G. Landry, President

MACKENZIE INVESTMENT MANAGEMENT INC.

By: ___________________________________
Michael G. Landry, President

ANNEX 1

FUND ACCOUNTING SERVICES AGREEMENT
FEE SCHEDULE

Based upon assets under management (in millions):

$0-$10 >$10-$40 >$40-$75 Over $75

Ivy Global $1,250 $2,500 $5,000 $6,500
Natural Resources
Fund

Ivy Asia Pacific $1,250 $2,500 $5,000 $6,500
Fund

Ivy International $1,250 $2,500 $5,000 $6,500
Small Companies Fund

EXHIBIT 9(cc)

ADDENDUM TO TRANSFER AGENCY AND SHAREHOLDER SERVICES AGREEMENT

IVY FUND

The Transfer Agency and Shareholder Services Agreement, made
as of the 1st day of January, 1992 between Ivy Fund and Ivy
Management, Inc. ("IMI"), the duties of IMI thereunder of which
were assigned on October 1, 1993 to Ivy Mackenzie Services Corp.
("IMSC")(formerly "Mackenzie Ivy Investor Services Corp."), is
hereby revised as set forth below in this Addendum.

Schedule A of the Agreement is revised in its entirety to read as
follows:

SCHEDULE A

Ivy Fees:

The transfer agency and shareholder service fees are based
on an annual per account fee. These fees are payable on a
monthly basis at the rate of 1/12 of the annual fee and are
charged with respect to all open accounts.

A. Per Account Fees

Fund Annual Fee

Ivy Asia Pacific Fund $ 20.00
(Classes A, B and C)
Ivy Bond Fund (Classes A, B and C) 20.75
Ivy Bond Fund (Class I) 10.25
Ivy Canada Fund 20.00
Ivy China Region Fund 20.00
Ivy Emerging Growth Fund 20.00
Ivy Global Fund 20.00
Ivy Global Natural Resources Fund 20.00
(Classes A, B and C)
Ivy Global Science & Technology Fund 20.00
(Classes A, B and C)
Ivy Global Science & Technology Fund 10.25
(Class I)
Ivy Growth Fund 20.00
Ivy Growth with Income Fund 20.00
Ivy International Fund 20.00
(Classes A, B and C)
Ivy International Fund (Class I) 10.25
Ivy International Bond Fund 20.00
Ivy International Small Companies Fund 20.00
(Classes A, B and C)

Ivy International Small Companies Fund 10.25
(Class I)
Ivy Latin America Strategy Fund 20.00
Ivy Money Market Fund 22.00
Ivy New Century Fund 20.00
Ivy Short-Term Bond Fund (Classes A and B) 20.75
Ivy Short-Term Bond Fund (Class I) 10.25

In addition, in accordance with an agreement between IMSC
and The Shareholder Services Group, each Fund will pay a fee of
$4.48 for each account that is closed, which fee may be increased
from time to time in accordance with the terms of that agreement.

B. Special Services

Fees for activities of a non-recurring nature, such as
preparation of special reports, portfolio consolidations, or
reorganization, and extraordinary shipments will be subject to
negotiation.

This Addendum shall take effect as of the date that the
Registration Statement pertaining to Ivy Global Natural Resources
Fund, Ivy Asia Pacific Fund and Ivy International Small Companies
Fund, filed with the Securities and Exchange Commission on or
about October 16, 1996 pursuant to Rule 485(a)(2) under the
Securities Act of 1933, first becomes effective.

IN WITNESS WHEREOF, the parties hereto have caused this
Addendum to be executed as of this 31st day of December, 1996.

IVY FUND

By: ___________________________________
Michael G. Landry, President

IVY MACKENZIE SERVICES CORP.

By: ___________________________________
C. William Ferris, President

EXHIBIT 10

DECHERT PRICE & RHOADS
TEN POST OFFICE SQUARE -- SOUTH
SUITE 1230
BOSTON, MA 02109-4603

December 23, 1996

Ivy Fund
Via Mizner Financial Plaza
700 South Federal Highway
Suite 300
Boca Raton, Florida 33432

Dear Sirs:

As counsel for Ivy Fund (the "Trust"), we are familiar with
the registration of the Trust under the Investment Company Act of
1940, as amended (the "1940 Act")(File No. 811-1028), and the
prospectus contained in Post-Effective Amendment No. 89 to the
Trust's registration statement relating to the shares of
beneficial interest of Ivy Asia Pacific Fund, Ivy Canada Fund,
Ivy China Region Fund, Ivy Global Fund, Ivy Global Natural
Resources Fund, Ivy Global Science & Technology Fund, Ivy
International Fund, Ivy International Small Companies Fund, Ivy
Latin America Strategy Fund and Ivy New Century Fund (the
"Shares") being filed under the Securities Act of 1933, as
amended (File No. 2-17613)("Post-Effective Amendment No. 89").
We have also examined such other records of the Trust,
agreements, documents and instruments as we deemed appropriate.

Based upon the foregoing, it is our opinion that the Shares
have been duly authorized and, when issued and sold at the public
offering price contemplated by the Prospectus for the Funds and
delivered by the Trust against receipt of the net asset value of
the Shares, will be issued as fully paid and nonassessable shares
of the Trust.

We consent to the filing of this opinion on behalf of the
Trust with the Securities and Exchange Commission in connection
with the filing of Post-Effective Amendment No. 89.

Very truly yours,

DECHERT PRICE & RHOADS

EXHIBIT 11

CONSENT OF INDEPENDENT ACCOUNTANTS

To the Board of Trustees of
Ivy Fund

We hereby consent to the incorporation by reference in
Post-Effective Amendment No. 89 to the Registration Statement on
Form N-1A (File No. 2-17613, hereafter the "Registration
Statement") of Ivy Fund of our reports dated February 16, 1996,
relating to the financial statements and financial highlights of
Ivy Canada Fund, Ivy China Region Fund, Ivy Global Fund, Ivy
International Fund, Ivy New Century Fund, and Ivy Latin America
Strategy Fund appearing in the December 31, 1995 Annual Reports
to Shareholders of the above Funds, which annual reports are
incorporated by reference in the Registration Statement.

We also hereby consent to the inclusion in the Registration
Statement of Ivy Fund of our reports dated December 11, 1996, on
our audits of the Statements of Assets and Liabilities as of
December 10, 1996, of Ivy Asia Pacific Fund, Ivy Global Natural
Resources Fund and Ivy International Small Companies Fund, which
Statements are included in the Registration Statement.

We also consent to the reference to our Firm under the caption
"The Funds' Financial Highlights" in the Prospectus and
"Auditors" in the Statement of Additional Information.

COOPERS & LYBRAND L.L.P.

Fort Lauderdale, Florida
December 23, 1996

EXHIBIT 12

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and Board of Trustees of
Ivy Asia Pacific Fund (the Fund)

We have audited the accompanying Statement of Assets and
Liabilities of the Fund as of December 10, 1996. This financial
statement is the responsibility of the Fund's management. Our
responsibility is to express an opinion on this financial
statement based on our audit.

We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements and financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable
basis for our opinion.

In our opinion, the financial statement referred to above
presents fairly, in all material respects, the financial position
of the Fund as of December 10, 1996, in conformity with generally
accepted accounting principles.

COOPERS & LYBRAND L.L.P.

Fort Lauderdale, Florida
December 11, 1996

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and Board of Trustees of
Ivy Global Natural Resources Fund (the Fund)

COOPERS & LYBRAND L.L.P.

Fort Lauderdale, Florida
December 11, 1996

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and Board of Trustees of
Ivy International Small Companies Fund (the Fund)

COOPERS & LYBRAND L.L.P.

Fort Lauderdale, Florida
December 11, 1996

EXHIBIT 15(n)

SUPPLEMENT TO
MASTER AMENDED AND RESTATED DISTRIBUTION PLAN
FOR IVY FUND CLASS A SHARES

WHEREAS, Ivy Fund is registered as an open-end investment
company under the Investment Company Act of 1940 (the "1940 Act")
and consists of one or more separate investment portfolios as may
be established and designated from time to time (each, a
"Portfolio");

WHEREAS, the Board of Trustees of Ivy Fund has adopted a
Plan dated December 21, 1991 and amended and restated on October
23, 1993 (the "Plan"), in accordance with the requirements of the
1940 Act, and determined that there is a reasonable likelihood
that the Plan will benefit Ivy Fund and its shareholders; and

WHEREAS, the Board of Trustees of Ivy Fund, pursuant to
Section 1 of the Plan, desires to supplement the Plan so that it
pertains to the Class A Shares of three new Portfolios of Ivy
Fund referred to as Ivy Global Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International Small Companies Fund.

NOW THEREFORE, the Board of Trustees of Ivy Fund having
determined that the Plan shall pertain to the Class A shares of
Ivy Global Natural Resources Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund, Ivy Fund hereby adopts this
Supplement as of this 31st day of December, 1996.

IVY FUND

By: ____________________________
Michael G. Landry, President

EXHIBIT 15(o)

SUPPLEMENT TO
DISTRIBUTION PLAN FOR IVY FUND CLASS B SHARES

WHEREAS, the Board of Trustees of Ivy Fund has adopted a
Plan dated October 23, 1993 (the "Plan"), in accordance with the
requirements of the 1940 Act, and determined that there is a
reasonable likelihood that the Plan will benefit Ivy Fund and its
shareholders; and

WHEREAS, the Board of Trustees of Ivy Fund, pursuant to
Section 1 of the Plan, desires to supplement the Plan so that it
pertains to the Class B Shares of three new Portfolios of Ivy
Fund referred to as Ivy Global Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International Small Companies Fund.

NOW THEREFORE, the Board of Trustees of Ivy Fund having
determined that the Plan shall pertain to the Class B shares of
Ivy Global Natural Resources Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund, Ivy Fund hereby adopts this
Supplement as of this 31st day of December, 1996.

IVY FUND

By: ____________________________
Michael G. Landry, President

EXHIBIT 15(p)

SUPPLEMENT TO
DISTRIBUTION PLAN FOR IVY FUND CLASS C SHARES

WHEREAS, the Board of Trustees of Ivy Fund has adopted a
Plan dated February 10, 1996 (the "Plan"), in accordance with the
requirements of the 1940 Act, and determined that there is a
reasonable likelihood that the Plan will benefit Ivy Fund and its
shareholders; and

WHEREAS, the Board of Trustees of Ivy Fund, pursuant to
Section 1 of the Plan, desires to supplement the Plan so that it
pertains to the Class C Shares of three new Portfolios of Ivy
Fund referred to as Ivy Global Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International Small Companies Fund.

NOW THEREFORE, the Board of Trustees of Ivy Fund having
determined that the Plan shall pertain to the Class C shares of
Ivy Global Natural Resources Fund, Ivy Asia Pacific Fund and Ivy
International Small Companies Fund, Ivy Fund hereby adopts this
Supplement as of this 31st day of December, 1996.

IVY FUND

By: ____________________________
Michael G. Landry, President

EXHIBIT 18(d)

IVY FUND

PLAN PURSUANT TO RULE 18F-3
UNDER THE
INVESTMENT COMPANY ACT OF 1940

(As Amended and Restated on December 7, 1996)

I. INTRODUCTION

In accordance with Rule 18f-3 under the Investment Company
Act of 1940, as amended (the "1940 Act"), this Plan describes the
multi-class structure that will apply to certain series of Ivy
Fund (each, a "Fund" and collectively, the "Funds"), including
the separate class arrangements for the service and distribution
of shares, the method for allocating the expenses and income of
each Fund among its classes, and any related exchange privileges
and conversion features that apply to the different classes.

II. THE MULTI-CLASS STRUCTURE

Each of the following Funds is authorized to issue three
classes of shares, identified as Class A, Class B and Class C,
respectively: Ivy Asia Pacific Fund, Ivy Bond Fund, Ivy Canada
Fund, Ivy China Region Fund, Ivy Emerging Growth Fund, Ivy Global
Fund, Ivy Global Natural Resources Fund, Ivy Global Science &
Technology Fund, Ivy Growth Fund, Ivy Growth with Income Fund,
Ivy Latin America Strategy Fund, Ivy Money Market Fund,[FN1][The
separation of Ivy Money Market Fund shares into three separate
classes has been authorized as a means of enabling the Funds'
transfer agent to track the contingent deferred sales charge
period that applies to Class B and Class C shares of other Ivy or
Mackenzie Funds that are being exchanged for shares of Ivy Money
Market Fund. In all other relevant respects, the three classes
of Ivy Money Market Fund shares are identical (i.e., having the
same arrangement for shareholder services and the distribution of
securities), and are not subject to any sales load other than in
connection with the redemption of Class B or Class C shares of
that have been acquired pursuant to an exchange from another Ivy
or Mackenzie Fund. (See Section III.D.)] Ivy International Fund,
Ivy International Bond Fund, Ivy International Small Companies
Fund and Ivy New Century Fund. Ivy Bond Fund, Ivy Global Science
& Technology Fund, Ivy International Fund and Ivy International
Small Companies Fund are also authorized to issue a fourth class
of shares, identified as Class I. Ivy Short-Term Bond Fund is
authorized to issue Class A, Class B and Class I shares.

Shares of each class of a Fund represent an equal pro rata
interest in the underlying assets of that Fund, and generally
have identical voting, dividend, liquidation, and other rights,
preferences, powers, restrictions, limitations, qualifications

and terms and conditions, except that: (a) each class shall have
a different designation; (b) each class shall bear certain class-
specific expenses, as described more fully in Section III.C.2.,
below; (c) each class shall have exclusive voting rights on any
matter submitted to shareholders that relates solely to its
arrangement; and (d) each class shall have separate voting rights
on any matter submitted to shareholders in which the interests of
one class differ from the interests of any other class. Each
class of shares shall also have the distinct features described
in Section III, below.

III. CLASS ARRANGEMENTS

A. FRONT-END SALES CHARGES AND CONTINGENT DEFERRED SALES
CHARGES

Class A shares shall be offered at net asset value plus a
front-end sales charge. The front-end sales charge shall be in
such amount as is disclosed in each Fund's current prospectus and
shall be subject to reductions for larger purchases and such
waivers or reductions as are determined or approved by the Board
of Trustees. Class A shares generally will not be subject to a
contingent deferred sales charge (a "CDSC"), although a CDSC may
be imposed in certain limited cases as disclosed in each Fund's
current prospectus or prospectus supplement.

Class B and Class C shares shall be offered at net asset
value without the imposition of a front-end sales charge. A CDSC
in such amount as is described in each Fund's current prospectus
or prospectus supplement shall be imposed on Class B and Class C
shares, subject to such waivers or reductions as are determined
or approved by the Board of Trustees.

Class I shares are not subject to a front-end sales charge
or a CDSC.

B. RULE 12B-1 PLANS

Each Fund (other than Ivy Money Market Fund) has adopted a
service and distribution plan pursuant to Rule 12b-1 under the
1940 Act (a "12b-1 plan") under which it pays to Ivy Mackenzie
Distributors, Inc. (the "Distributor") an annual fee based on the
average daily net assets value of the Fund's outstanding Class A,
Class B and Class C shares, respectively.[FN2][Class I shares are
not subject to Rule 12b-1 service or distribution fees.] The
maximum fees currently charged to each Fund under its 12b-1 plan
are set forth in the table below, and are expressed as a
percentage of the Fund's average daily net assets.[FN3][Fees for
services in connection with the Rule 12b-1 plans will be
consistent with any applicable restriction imposed by the
National Association of Securities Dealers, Inc.]

The services that the Distributor provides in connection
with each Rule 12b-1 plan for which service fees[FN4][Each Fund

pays the Distributor at the annual rate of up to 0.25% of the
average daily net asset value attributable to its Class A, Class
B and Class C shares, respectively. Ivy Canada Fund pays an
additional service-related fee of 0.15% of the average daily net
asset value attributable to its Class A shares. In addition,
each Fund (other than Ivy Canada Fund and Ivy Short-Term Bond
Fund) pays the Distributor a fee for other distribution services
at the annual rate of 0.75% of the Fund's average daily net
assets attributable to its Class B and Class C shares. Ivy
Canada Fund and Ivy Short-Term Bond Fund pay the Distributor an
additional amount for other distribution services at the annual
rate of 0.60% and 0.50%, respectively, of average daily net
assets attributable to their respective Class B and Class C
shares.] are paid include, among other things, advising clients
or customers regarding the purchase, sale or retention of a
Fund's Class A, Class B or Class C shares, answering routine
inquiries concerning the Fund, assisting shareholders in changing
options or enrolling in specific plans and providing shareholders
with information regarding the Fund and related developments.

The other distribution services provided by the Distributor
in connection with each Fund's Rule 12b-1 plan include any
activities primarily intended to result in the sale of the Fund's
Class B and Class C shares. For such distribution services, the
Distributor is paid for, among other things, compensation to
broker-dealers and other entities that have entered into
agreements with the Distributor; bonuses and other incentives
paid to broker-dealers or such other entities; compensation to
and expenses of employees of the Distributor who engage in or
support distribution of a Fund's Class B or Class C shares;
telephone expenses; interest expense (only to the extent not
prohibited by a regulation or order of the SEC); printing of
prospectuses and reports for other than existing shareholders;
and preparation, printing and distribution of sales literature
and advertising materials.

RULE 12b-1 FEES

CLASS B AND
CLASS A CLASS A CLASS C SHARES
SHARES SHARES (SERVICE AND
(SERVICE (DISTRIBUTION DISTRIBUTION
FUND NAME FEE) FEES) FEES)

Ivy Asia Pacific Fund 0.25% 0.00% 1.00%

Ivy Bond Fund 0.25% 0.00% 1.00%

Ivy Canada Fund 0.25% 0.15% 1.00%

Ivy China Region Fund 0.25% 0.00% 1.00%

Ivy Emerging Growth
Fund 0.25% 0.00% 1.00%

Ivy Global Fund 0.25% 0.00% 1.00%

Ivy Global Natural
Resources Fund 0.25% 0.00% 1.00%

Ivy Global Science &
Technology Fund 0.25% 0.00% 1.00%

Ivy Growth Fund 0.25% 0.00% 1.00%

Ivy Growth with Income
Fund 0.25% 0.00% 1.00%

Ivy International Bond
Fund 0.25% 0.00% 1.00%

Ivy International Fund 0.25% 0.00% 1.00%

Ivy International
Small Companies Fund 0.25% 0.00% 1.00%

Ivy Latin America
Strategy Fund 0.25% 0.00% 1.00%

Ivy Money Market Fund* 0.00% 0.00% 0.00%

Ivy New Century Fund 0.25% 0.00% 1.00%

Ivy Short-Term Bond
Fund 0.25% 0.00% 0.75%**

* See footnote 1.
** Ivy Short-Term Bond Fund has no Class C shares.

C. ALLOCATION OF EXPENSES AND INCOME

1. "TRUST" AND "FUND" EXPENSES

The gross income, realized and unrealized capital gains and
losses and expenses (other than "Class Expenses," as defined
below) of each Fund shall be allocated to each class on the basis
of its net asset value relative to the net asset value of the
Fund. Expenses so allocated include expenses of Ivy Fund that
are not attributable to a particular Fund or class of a Fund
("Trust Expenses") and expenses of a Fund not attributable to a
particular class of the Fund ("Fund Expenses"). Trust Expenses
include, but are not limited to, Trustees' fees and expenses;
insurance costs; certain legal fees; expenses related to
shareholder reports; and printing expenses. Fund Expenses
include, but are not limited to, certain registration fees (i.e.,
state registration fees imposed on a Fund-wide basis and SEC
registration Fees); custodial fees; transfer agent fees; advisory
fees; fees related to the preparation of separate documents of a
particular Fund, such as a separate prospectus; and other
expenses relating to the management of the Fund's assets.

2. "CLASS" EXPENSES

The types of expenses attributable to a particular class
("Class Expenses") include: (a) payments pursuant to the Rule
12b-1 plan for that class[FN5][Class I shares of Ivy Bond Fund,
Ivy Global Science & Technology Fund, Ivy Short-Term Bond Fund,
Ivy International Fund and Ivy International Small Companies Fund
bear no distribution or service fees.]; (b) transfer agent fees
attributable to a particular class; (c) printing and postage
expenses related to preparing and distributing shareholder
reports, prospectuses and proxy materials; (d) registration fees
(other than those set forth in Section C.1. above); (e) the
expense of administrative personnel and services as required to
support the shareholders of a particular class[FN6][Class I
shares of Ivy Bond Fund, Ivy Global Science & Technology Fund,
Ivy International Fund and Ivy International Small Companies Fund
bear lower administrative services fees relative to these Funds'
other classes of shares (i.e., Class I shares of the Funds pay a
monthly administrative services fee based upon each Fund's
average daily net assets at the annual rate of only 0.01%, while
Class A, Class B and Class C shares of these two Funds pay such a
fee at the annual rate of 0.10%).]; (f) litigation or other legal
expenses relating solely to a particular class; (g) Trustees'
fees incurred as a result of issues relating to a particular
class; and (h) the expense of holding meetings solely for
shareholders of a particular class. Expenses described in
subpart (a) of this paragraph must be allocated to the class for
which they are incurred. All other expenses described in this
paragraph may (but need not) be allocated as Class Expenses, but
only if Ivy Fund's Board of Trustees determines, or Ivy Fund's
President and Secretary/Treasurer have determined, subject to
ratification by the Board of Trustees, that the allocation of

such expenses by class is consistent with applicable legal
principles under the 1940 Act and the Internal Revenue Code of
1986, as amended.

In the event that a particular expense is no longer
reasonably allocable by class or to a particular class, it shall
be treated as a Trust Expense or Fund Expense, and in the event a
Trust Expense or Fund Expense becomes reasonably allocable as a
Class Expense, it shall be so allocated, subject to compliance
with Rule 18f-3 and to approval or ratification by the Board of
Trustees.

3. WAIVERS OR REIMBURSEMENTS OF EXPENSES

Expenses may be waived or reimbursed by any adviser to Ivy
Fund, by Ivy Fund's underwriter or any other provider of services
to Ivy Fund without the prior approval of Ivy Fund's Board of
Trustees.

D. EXCHANGE PRIVILEGES

Shareholders of each Fund have exchange privileges with the
other Funds and with the five funds that comprise Mackenzie
Series Trust (together, with the Funds, the "Ivy and Mackenzie
Funds").[FN7][Other exchange privileges, not described herein,
exist under certain other circumstances, as described in each
Fund's current prospectus or prospectus supplement.]

1. CLASS A:

INITIAL SALES CHARGE SHARES. Class A shareholders may
exchange their Class A shares ("outstanding Class A shares") for
Class A shares of another Ivy or Mackenzie Fund (or for shares of
another Ivy or Mackenzie Fund that currently offers only a single
class of shares) ("new Class A Shares") on the basis of the
relative net asset value per Class A share, plus an amount equal
to the difference, if any, between the sales charge previously
paid on the outstanding Class A shares and the sales charge
payable at the time of the exchange on the new Class A shares.
Incremental sales charges are waived for outstanding Class A
shares that have been invested for 12 months or longer.

CONTINGENT DEFERRED SALES CHARGE SHARES. Class A
shareholders may exchange their Class A shares subject to a
contingent deferred sales charge ("CDSC"), as described in the
Prospectus ("outstanding Class A shares"), for Class A shares of
another Ivy or Mackenzie Fund (or for shares of another Ivy or
Mackenzie Fund that currently offers only a single class of
shares) ("new Class A shares") on the basis of the relative net
asset value per Class A share, without the payment of a CDSC that
would otherwise be due upon the redemption of the outstanding
Class A shares. Class A shareholders of a Fund exercising the
exchange privilege will continue to be subject to the Fund's CDSC
schedule (or period) following an exchange, unless the CDSC

schedule that applies to the new Class A shares is higher (or
such period is longer) than the CDSC schedule (or period), if
any, applicable to the outstanding Class A shares, in which case
the schedule (or period) of the Fund into which the exchange is
made shall apply.

2. CLASS B AND CLASS C:

Shareholders may exchange their Class B or Class C shares
("outstanding Class B shares" or "outstanding Class C shares,"
respectively) for Class B (or Class C) shares of another Ivy or
Mackenzie Fund ("new Class B shares" or "new Class C shares,"
respectively) on the basis of the net asset value per Class B (or
Class C) share, without the payment of any CDSC that would
otherwise be due upon the redemption of the outstanding Class B
(or Class C) shares. Class B and Class C shareholders of a Fund
exercising the exchange privilege will continue to be subject to
the Fund's CDSC schedule (or period) following an exchange,
unless, in the case of Class B shareholders, the CDSC schedule
that applies to the new Class B shares is higher (or such period
is longer) than the CDSC schedule (or period) applicable to the
outstanding Class B shares, in which case the schedule (or
period) of the Fund into which the exchange is made shall apply.

3. CLASS I:

Class I shareholders may exchange their outstanding Class I
shares for Class I shares of another Fund or Mackenzie Fund on
the basis of the net asset value per Class I share.

4. GENERAL:

Shares resulting from the reinvestment of dividends and
other distributions will not be charged an initial sales charge
or CDSC when exchanged into another Ivy or Mackenzie Fund.

With respect to Fund shares subject to a CDSC, if less than
all of an investment is exchanged out of the Fund, the shares
exchanged will reflect, pro rata, the cost, capital appreciation
and/or reinvestment of distributions of the original investment
as well as the original purchase date, for purposes of
calculating any CDSC for future redemptions of the exchanged
shares.

E. CONVERSION FEATURE

Class B shares of a Fund convert automatically to Class A
shares of the Fund as of the close of business on the first
business day after the last day of the calendar quarter in which
the eighth anniversary of the purchase date of the Class B shares
occurs. The conversion will be based on the relative net asset
values per share of the two classes, without the imposition of
any sales load, fee or other charge. For purposes of calculating
the eight year holding period, the "purchase date" shall mean the

date on which the Class B shares were initially purchased,
regardless of whether the Class B shares that are subject to the
conversion were obtained through an exchange (or series of
exchanges) from a different Ivy or Mackenzie Fund. For purposes
of conversion of Class B shares, Class B shares acquired through
the reinvestment of dividends and capital gain distributions paid
in respect of Class B shares will be held in a separate sub-
account. Each time any Class B shares in the shareholder's
regular account (other than those shares in the sub-account)
convert to Class A shares, a pro rata portion of the Class B
shares in the sub-account will also convert to Class A shares.
The portion will be determined by the ratio that the
shareholder's Class B shares converting to Class A shares bears
to the shareholder's total Class B shares not acquired through
the reinvestment of dividends and capital gain distributions.

IV. BOARD REVIEW

A. INITIAL APPROVAL

The Board of Trustees of Ivy Fund, including a majority of
the Trustees who are not interested persons of Ivy Fund, as
defined under the 1940 Act (the "Independent Trustees"), at a
meeting held on December 1-2, 1995, initially approved this Plan
based on a determination that the Plan, including the expense
allocation, is in the best interests of each class of shares of
each Fund individually and Ivy Fund as a whole.[FN8][The Plan, as
initially approved, pertained only to the Class A and Class B
shares of the Funds, and the Class I shares of Ivy Bond Fund, Ivy
Short-Term Bond Fund and Ivy International Fund. The Plan was
amended and restated on April 30, 1996 to reflect the
establishment and designation of Class C shares of the Funds
(other than Ivy Short-Term Bond Fund). The Plan was amended and
restated on June 8, 1996 to reflect the establishment and
designation of Ivy Global Science and Technology Fund. The Plan
has been further amended and restated, as of the date set forth
on the first page hereof, to reflect the establishment and
designation of Ivy Global Natural Resources Fund, Ivy Asia
Pacific Fund and Ivy International Small Companies Fund.]

B. APPROVAL OF AMENDMENTS

Before any material amendments to this Plan, Ivy Fund's
Board of Trustees, including a majority of the Independent
Trustees, must find that the Plan, as proposed to be amended
(including any proposed amendments to the method of allocating
class and/or fund expenses), is in the best interests of each
class of shares of each Fund individually and Ivy Fund as a
whole. In considering whether to approve any proposed
amendment(s) to the Plan, the Trustees of Ivy Fund shall request
and evaluate such information as they consider reasonably
necessary to evaluate the proposed amendment(s) to the Plan.
Such information shall address the issue of whether any waivers
or reimbursements of advisory or administrative fees could be

considered a cross-subsidization of one class by another, and
other potential conflicts of interest between classes.

C. PERIODIC REVIEW

The Board of Trustees of Ivy Fund shall review the Plan as
frequently as it deems necessary, consistent with applicable
legal requirements.

V. EFFECTIVE DATE

The Plan first became effective as of January 1, 1996.