OPPENHEIMER INVESTMENT GRADE BOND FUND
Supplement dated September 30, 1994
to the Prospectus dated May 1, 1994
The Prospectus is amended as follows:
1. The following is added at the end of the second paragraph under the
caption "Mortgage-Backed Securities and CMOs" on page 8:
The Fund may also invest in CMOs that are "stripped," that is, the
security is divided into two parts, one of which receives the principal
payments (P/O) and the other which receives the interest (I/O). I/Os
and P/Os are subject to increased volatility in price due to interest
rate changes. Rapid repayment of mortgage principal in a sharply
declining interest rate environment reduced the value of an I/O since
the interest will not be paid on prepaid mortgages, and increases the
value of the value of the corresponding P/O because the payments are
nearer. If rates rise, the value of the P/O falls as early payments
decline and the value of the I/O increases as prospects for a long
stream of interest payments increase.
September 30, 1994 PS285
