<PAGE>
PaineWebber
Global Equity Fund
PaineWebber
Global Income Fund
PaineWebber
Asia Pacific
Growth Fund
PaineWebber
Emerging Markets
Equity Fund
------------------------------
PROSPECTUS
MARCH 1, 2000
------------------------------
This prospectus offers four classes of shares in PaineWebber's four Global
Funds -- Classes A, B, C and Y. Each class has different sales charges and
ongoing expenses. You can choose the class that is best for you based on how
much you plan to invest and how long you plan to hold your fund shares. Class Y
shares are available only to certain types of investors.
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved any fund's shares or determined whether this prospectus
is complete or accurate. To state otherwise is a crime.
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
Contents
THE FUNDS
<TABLE>
<S> <C> <C>
- ----------------------------------------------------------------------------------------------
What every investor
should know about PaineWebber Global Equity Fund:
the funds 3 Investment Objective, Strategies and Risks
4 Performance
5 Expenses and Fee Tables
PaineWebber Global Income Fund:
6 Investment Objective, Strategies and Risks
7 Performance
8 Expenses and Fee Tables
Paine Webber Asia Pacific Growth Fund:
9 Investment Objective, Strategies and Risks
10 Performance
11 Expenses and Fee Tables
PaineWebber Emerging Markets Equity Fund:
12 Investment Objective, Strategies and Risks
13 Performance
14 Expenses and Fee Tables
YOUR INVESTMENT
- ----------------------------------------------------------------------------------------------
Information for 17 Managing Your Fund Account
managing your fund --Flexible Pricing
account --Buying Shares
--Selling Shares
--Exchanging Shares
--Pricing and Valuation
ADDITIONAL INFORMATION
- ----------------------------------------------------------------------------------------------
Additional important 22 Management
information about 23 Dividends and Taxes
the funds 24 Financial Highlights
- ----------------------------------------------------------------------------------------------
Where to learn more Back Cover
about PaineWebber
mutual funds
</TABLE>
The funds are not complete or
balanced investment programs.
- --------------------------------------------------------------------------------
Prospectus Page 2
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund
PaineWebber Global Equity Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Long-term growth of capital.
PRINCIPAL INVESTMENT STRATEGIES
The fund invests primarily in stocks of companies in the United States and in
foreign countries that are represented in the MSCI Europe, Australia and Far
East Index. The EAFE Index reflects stocks in most developed countries outside
North America. The fund also invests, to a lesser extent, in stocks of issuers
in other countries, including emerging markets, and in U.S. and foreign bonds.
The fund's investment adviser, Mitchell Hutchins Asset Management Inc.,
allocates the fund's assets between U.S. and foreign markets based on how it
expects U.S. stock markets to perform in comparison to stock markets in certain
of the EAFE countries. Mitchell Hutchins may increase the allocation of the
fund's assets to either the U.S. or foreign markets if it believes that one of
those markets has a greater potential for high returns, relative to the risk of
loss. The fund may (but is not required to) use options, futures contracts,
forward currency contracts and other derivatives as part of its investment
strategy or to help manage portfolio risks.
Mitchell Hutchins has appointed Invista Capital Management, LLC as the
sub-adviser for the fund's foreign investments. In buying and selling foreign
stocks for the fund, Invista analyzes the fundamental business prospects of
industries and of individual companies and assesses the relative risks presented
by the countries in which those companies operate.
In buying and selling U.S. stocks for the fund, Mitchell Hutchins uses its own
Factor Valuation Model to identify companies that appear undervalued. The model
ranks companies based on "value" factors, such as dividends, cash flows,
earnings and book values, as well as on "growth" factors, such as earnings
momentum and industry performance forecasts. Mitchell Hutchins then applies
fundamental analysis to select specific stocks from among those identified by
the model.
PRINCIPAL RISKS
An investment in the fund is not guaranteed; you may lose money by investing in
the fund.
Common stocks, which are the fund's main investment, generally fluctuate in
value more than other investments. The fund could lose all of its investment in
a company's stock. Mitchell Hutchins may not be successful in making the best
allocation between U.S. and foreign investments. The value of the fund's foreign
investments may fall due to adverse political, social and economic developments
abroad and decreases in foreign currency values relative to the U.S. dollar.
This risk is greater for investments in emerging market issuers than for issuers
in more developed countries. The fund's investments in derivatives may rise or
fall more rapidly than other investments.
More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies." In particular,
see the following headings:
- - Equity Risk
- - Sector Allocation Risk
- - Foreign Investing Risk
- - Emerging Markets Risk
- - Derivatives Risk
INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THOSE REPORTS).
- --------------------------------------------------------------------------------
Prospectus Page 3
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
chart shows Class A shares because they have the longest performance history of
any class of fund shares. The chart does not reflect the effect of sales
charges; if it did, the total returns shown would be lower.
The table that follows the chart shows the average annual returns over several
time periods for each class of the fund's shares. That table does reflect fund
sales charges. The table compares fund returns to returns on a broad-based
market index that is unmanaged and that, therefore, does not include any sales
charges or expenses.
The fund's past performance does not necessarily indicate how the fund will
perform in the future. This may be particularly true of the period prior to
October 1, 1998, when Mitchell Hutchins and Invista assumed the day-to-day
management of the fund's assets. Prior to that date, another sub-adviser was
responsible for managing all fund assets.
TOTAL RETURN ON CLASS A SHARES (1992 IS THE FUND'S FIRST FULL CALENDAR YEAR
OF OPERATIONS)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CALENDAR YEAR PERCENTAGES
<S> <C>
1990
1991
1992 3.26%
1993 30.77%
1994 -2.38%
1995 13.54%
1996 14.80%
1997 6.34%
1998 11.61%
1999 18.19%
</TABLE>
Best quarter during years shown: 1st quarter, 1998--19.22%
Worst quarter during years shown: 3rd quarter, 1998--(19.41%)
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999
<TABLE>
<CAPTION>
MSCI
CLASS CLASS A CLASS B CLASS C CLASS Y WORLD
(INCEPTION DATE) (11/14/91) (8/25/95) (5/10/93) (5/10/93) INDEX
- ---------------- ---------- --------- --------- --------- -----
<S> <C> <C> <C> <C> <C>
One Year........................................... 12.86% 12.15% 16.23% 18.57% 20.34%
Five Years......................................... 11.79% N/A 11.95% 13.20% 20.25%
Life of Class...................................... 11.11% 10.71% 10.99% 12.19% *
</TABLE>
- ---------
*Average annual total returns for the MSCI World Index for the life of each
class were as follows: Class A--15.29%; Class B--20.44%; Class C--17.14%; and
Class Y--17.14%.
- --------------------------------------------------------------------------------
Prospectus Page 4
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investments)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases
(as a % of offering price)................................ 4.5% None None None
Maximum Contingent Deferred Sales Charge (Load) (CDSC)
(as a % of offering price)................................ None 5% 1% None
Exchange Fee................................................ None None None None
</TABLE>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Management Fees............................................. 0.85% 0.85% 0.85% 0.85%
Distribution and/or Service (12b-1) Fees.................... 0.25 1.00 1.00 None
Other Expenses.............................................. 0.46 0.57 0.49 0.38
---- ---- ---- ----
Total Annual Fund Operating Expenses........................ 1.56% 2.42% 2.34% 1.23%
==== ==== ==== ====
</TABLE>
EXAMPLE
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds.
This example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods unless
otherwise stated. The example also assumes that your investment has a 5% return
each year and that the fund's operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your costs would
be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Class A..................................................... $602 $ 920 $1,262 $2,223
Class B (assuming sales of all shares at end of period)..... 745 1,055 1,491 2,348
Class B (assuming no sales of shares)....................... 245 755 1,291 2,348
Class C (assuming sales of all shares at end of period)..... 337 730 1,250 2,676
Class C (assuming no sales of shares)....................... 237 730 1,250 2,676
Class Y..................................................... 125 390 676 1,489
</TABLE>
- --------------------------------------------------------------------------------
Prospectus Page 5
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Income Fund
PaineWebber Global Income Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Primarily, high current income consistent with prudent investment risk;
secondarily, capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
The fund invests primarily in high quality bonds of governmental and private
issuers in the United States and in developed foreign countries. These high
quality bonds are rated in one of the two highest rating categories or are of
comparable quality. The fund also invests, to a lesser extent, in lower rated
bonds, including bonds of issuers in emerging markets. These may include bonds
that have very low credit ratings but that Mitchell Hutchins Asset Management
Inc., the fund's investment adviser, believes may provide a return that is high
enough to justify the additional risk. Some of the fund's bonds may be backed by
mortgages.
Mitchell Hutchins normally invests a portion of the fund's assets in bonds of
U.S. government and private issuers and allocates the balance of the fund's
portfolio among bonds of issuers in different foreign countries. Mitchell
Hutchins decides which bonds to buy or sell by determining the allocation to
different geographic areas, countries and industries based upon its assessment
of fundamental economic strengths, credit quality and currency and interest rate
trends. The fund may (but is not required to) use options, futures contracts,
forward currency contracts and other derivatives as part of its investment
strategy or to help manage portfolio risks.
PRINCIPAL RISKS
An investment in the fund is not guaranteed; you may lose money by investing in
the fund.
The fund is subject to interest rate risk, which is the risk that the value of
its investments generally will fall when interest rates rise. The value of the
fund's foreign investments also may fall due to adverse political, social and
economic developments abroad and decreases in foreign currency values relative
to the U.S. dollar. This risk is greater for investments in emerging market
issuers than for issuers in more developed countries. The fund also is subject
to credit risk, which is the risk that issuers may fail, or become less able to
make principal or interest payments when due. This risk is greater for bonds
rated below investment grade. Investments in foreign government bonds involve
special risks because the fund may have limited legal recourse in the event of
default. The fund is subject to sector allocation risk, which means that
Mitchell Hutchins may not be successful in choosing the best allocation of the
fund's assets between U.S. and foreign issuers.
Because the fund is non-diversified, it can invest more of its assets in a
single issuer than a diversified fund can. As a result, changes in the market
value of a single issuer can have a greater effect on the fund's performance and
share price than if the fund held a smaller position. The fund's investments in
derivatives may rise or fall more rapidly than other investments.
More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies." In particular,
see the following headings:
- - Interest Rate Risk
- - Foreign Investing Risk
- - Credit Risk
- - Sovereign Risk
- - Sector Allocation Risk
- - Emerging Markets Risk
- - Non-Diversified Status Risk
- - Derivatives Risk
INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THOSE REPORTS).
- --------------------------------------------------------------------------------
Prospectus Page 6
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Income Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
chart shows Class B shares because they have the longest performance history of
any class of fund shares. The chart does not reflect the effect of sales
charges; if it did, the total returns shown would be lower.
The table that follows the chart shows the average annual returns over several
time periods for each class of the fund's shares. That table does reflect fund
sales charges. The table compares fund returns to returns on a broad-based
market index that is unmanaged and that, therefore, does not include any sales
charges or expenses.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN ON CLASS B SHARES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CALENDAR YEAR PERCENTAGES
<S> <C>
1990 17.72%
1991 10.75%
1992 0.38%
1993 13.36%
1994 -4.77%
1995 12.39%
1996 6.34%
1997 3.06%
1998 9.73%
1999 -4.89%
</TABLE>
Best quarter during years shown: 3rd quarter, 1991--7.17%
Worst quarter during years shown: 1st quarter, 1994--(3.92)%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999
<TABLE>
<CAPTION>
SALOMON SMITH
BARNEY WORLD
CLASS CLASS A CLASS B* CLASS C CLASS Y GOVERNMENT
(INCEPTION DATE) (7/1/91) (3/20/87) (7/2/92) (8/26/91) BOND INDEX
- ---------------- -------- --------- -------- --------- -------------
<S> <C> <C> <C> <C> <C>
One Year...................................... (7.77)% (9.43)% (5.09)% (3.60)% (4.27)%
Five Years.................................... 5.16% 4.83% 5.51% 6.36% 6.42%
Ten Years..................................... N/A 6.75% N/A N/A 8.03%
Life of Class................................. 5.58% 7.98% 4.80% 6.35% **
</TABLE>
- ---------
*Assumes conversion of Class B shares to Class A shares after six years.
**Average annual total returns for the Salomon Smith Barney World Government
Bond Index for the life of each class were as follows: Class A--8.17%;
Class B--7.94%; Class C--6.63%; and Class Y--7.82%.
- --------------------------------------------------------------------------------
Prospectus Page 7
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Income Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investments)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases
(as a % of offering price)................................ 4% None None None
Maximum Contingent Deferred Sales Charge (Load) (CDSC)
(as a % of offering price)................................ None 5% 0.75% None
Exchange Fee................................................ None None None None
</TABLE>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Management Fees............................................. 0.75% 0.75% 0.75% 0.75%
Distribution and/or Service (12b-1) Fees.................... 0.25 1.00 0.75 None
Other Expenses.............................................. 0.19 0.36 0.19 0.10
---- ---- ---- ----
Total Annual Fund Operating Expenses........................ 1.19% 2.11% 1.69% 0.85%
==== ==== ==== ====
</TABLE>
EXAMPLE
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods unless
otherwise stated. The example also assumes that your investment has a 5% return
each year and that the fund's operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your costs would
be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Class A..................................................... $516 $763 $1,028 $1,785
Class B (assuming sales of all shares at end of period)..... 714 961 1,334 1,990
Class B (assuming no sales of shares)....................... 214 661 1,134 1,990
Class C (assuming sales of all shares at end of period)..... 247 533 918 1,998
Class C (assuming no sales of shares)....................... 172 533 918 1,998
Class Y..................................................... 87 271 471 1,049
</TABLE>
- --------------------------------------------------------------------------------
Prospectus Page 8
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Asia Pacific Growth Fund
PaineWebber Asia Pacific Growth Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Long-term capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
The fund invests primarily in stocks of companies in the Asia Pacific Region,
except Japan.
Mitchell Hutchins Asset Management Inc., the fund's investment adviser, has
appointed Schroder Investment Management North America Inc. (SIMNA) as the
fund's sub-adviser. SIMNA focuses on companies that it believes have a
sustainable competitive advantage and growth potential that is undervalued by
other investors. SIMNA allocates the fund's assets among Asia Pacific Region
countries based on its assessment of the likelihood that those countries will
have favorable long-term business environments. In deciding which securities
within a country to buy or sell for the fund, SIMNA analyzes historical growth
rates and future growth prospects, management capability and profit margins.
SIMNA's evaluation of securities reflects information available from the
extensive network of locally based analysts maintained by SIMNA and its
affiliates.
The fund may (but is not required to) use options, futures contracts, forward
currency contracts and other derivatives as part of its investment strategy or
to help manage portfolio risks.
PRINCIPAL RISKS
An investment in the fund is not guaranteed; you may lose money by investing in
the fund.
Common stocks, which are the fund's main investment, generally fluctuate in
value more than other investments. The fund could lose all of its investment in
a company's stock. The value of the fund's foreign investments may fall due to
adverse political, social and economic developments abroad and decreases in
foreign currency values relative to the U.S. dollar. These risks are greater for
investments in emerging market issuers than for issuers in more developed
countries. The fund's concentration of a significant portion of its assets in
one geographic area, means that it will be more susceptible to factors adversely
affecting that area. The fund's investments in derivatives may rise or fall more
rapidly than other investments.
More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies." In particular,
see the following headings:
- - Equity Risk
- - Foreign Investing Risk
- - Emerging Markets Risk
- - Regional Concentration Risk
- - Derivatives Risk
INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THOSE REPORTS).
- --------------------------------------------------------------------------------
Prospectus Page 9
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Asia Pacific Growth Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
chart shows Class A shares because they have as long a performance history as
any class of fund shares. The chart does not reflect the effect of sales
charges; if it did, the total returns shown would be lower.
The table that follows the chart shows the average annual returns during the
last calendar year and for the life of the fund for each class of the fund's
shares. That table does reflect fund sales charges. The table compares fund
returns to returns on a broad-based market index that is unmanaged and that,
therefore, does not include any sales charges or expenses.
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
TOTAL RETURN ON CLASS A SHARES (1998 IS THE FUND'S FIRST FULL CALENDAR YEAR
OF OPERATIONS)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CALENDAR YEAR PERCENTAGES
<S> <C>
1990
1991
1992
1993
1994
1995
1996
1997
1998 -11.74%
1999 67.35%
</TABLE>
Best quarter during the year shown: 2nd quarter, 1999--29.55%
Worst quarter during the year shown: 2nd quarter, 1998--(25.95)%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999
<TABLE>
<CAPTION>
MSCI
CLASS CLASS A CLASS B CLASS C CLASS Y ALL COUNTRY ASIA PACIFIC
(INCEPTION DATE) (3/25/97) (3/25/97) (3/25/97) (3/13/98) FREE (EX-JAPAN) INDEX
- ---------------- --------- --------- --------- --------- ------------------------
<S> <C> <C> <C> <C> <C>
One Year.................................... 59.90% 60.97% 65.11% 67.72% 55.23%
Life of Class............................... (2.51)% (2.68)% (1.58)% 20.68% *
</TABLE>
- ---------
*Average annual total returns for the MSCI All Country Asia Pacific Free
(ex-Japan) Index for the life of each class were as follows: Class A--0.37%;
Class B--0.37%; Class C--0.37%; and Class Y--16.78%.
- --------------------------------------------------------------------------------
Prospectus Page 10
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Asia Pacific Growth Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investments)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases
(as a % of offering price)................................ 4.5% None None None
Maximum Contingent Deferred Sales Charge (Load) (CDSC)
(as a % of offering price)................................ None 5% 1% None
Exchange Fee................................................ None None None None
</TABLE>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Management Fees............................................. 1.20% 1.20% 1.20% 1.20%
Distribution and/or Service (12b-1) Fees.................... 0.25 1.00 1.00 None
Other Expenses.............................................. 1.28 1.32 1.25 1.14
---- ---- ---- ----
Total Annual Fund Operating Expenses........................ 2.73% 3.52% 3.45% 2.34%
==== ==== ==== ====
</TABLE>
EXAMPLE
The following example is intended to help you compare the cost of investing in
the fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods unless
otherwise stated. The example also assumes that your investment has a 5% return
each year and that the fund's operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your costs would
be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Class A..................................................... $714 $1,259 $1,830 $3,373
Class B (assuming sales of all shares at end of period)..... 855 1,380 2,026 3,456
Class B (assuming no sales of shares)....................... 355 1,080 1,826 3,456
Class C (assuming sales of all shares at end of period)..... 448 1,059 1,793 3,730
Class C (assuming no sales of shares)....................... 348 1,059 1,793 3,730
Class Y..................................................... 237 730 1,250 2,676
</TABLE>
- --------------------------------------------------------------------------------
Prospectus Page 11
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Emerging Markets Equity Fund
PaineWebber Emerging Markets Equity Fund
INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
- --------------------------------------------------------------------------------
FUND OBJECTIVE
Long-term capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
The fund invests primarily in stocks of companies in emerging market countries.
Mitchell Hutchins Asset Management Inc., the fund's investment adviser, has
appointed Schroder Investment Management North America Inc. (SIMNA) as the
fund's sub-adviser. SIMNA focuses on companies that it believes have a
sustainable competitive advantage and growth potential that is undervalued by
other investors. SIMNA allocates the fund's assets among emerging market
countries based on its assessment of the likelihood that those countries will
have favorable long-term business environments. In deciding which securities
within a country to buy or sell for the fund, SIMNA analyzes historical growth
rates and future growth prospects, management capability and profit margins.
SIMNA's evaluation of securities reflects information available from the
extensive network of locally based analysts maintained by SIMNA and its
affiliates.
The fund may (but is not required to) use options, futures contracts, forward
currency contracts and other derivatives as part of its investment strategy or
to help manage portfolio risks.
PRINCIPAL RISKS
An investment in the fund is not guaranteed; you may lose money by investing in
the fund.
Common stocks, which are the fund's main investment, generally fluctuate in
value more than other investments. The fund could lose all of its investment in
a company's stock. The value of the fund's foreign investments may fall due to
adverse political, social and economic developments abroad and decreases in
foreign currency values relative to the U.S. dollar. These risks are greater for
emerging market issuers than for issuers in more developed countries. The fund's
investments in derivatives may rise or fall more rapidly than other investments.
More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies." In particular,
see the following headings:
- - Equity Risk
- - Foreign Investing Risk
- - Emerging Markets Risk
- - Derivatives Risk
INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THOSE REPORTS).
- --------------------------------------------------------------------------------
Prospectus Page 12
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Emerging Markets Equity Fund
PERFORMANCE
- --------------------------------------------------------------------------------
RISK/RETURN BAR CHART AND TABLE
The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.
The bar chart shows how the fund's performance has varied from year to year. The
chart shows Class A shares because they have as long a performance history as
any class of fund shares. The chart does not reflect the effect of sales
charges; if it did, the total returns shown would be lower.
The table that follows the chart shows the average annual returns over several
time periods for each class of the fund's shares. That table does reflect fund
sales charges. The table compares fund returns to returns on a broad-based
market index that is unmanaged and that, therefore, does not include any sales
charges or expenses.
The fund's past performance does not necessarily indicate how the fund will
perform in the future. This may be particularly true of the period prior to
February 25, 1997, which is when Mitchell Hutchins appointed SIMNA as the fund's
sub-adviser. Prior to that date, another sub-adviser was responsible for
managing the fund's assets.
TOTAL RETURN ON CLASS A SHARES (1995 IS THE FUND'S FIRST FULL CALENDAR YEAR
OF OPERATIONS)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CALENDAR YEAR PERCENTAGES
<S> <C>
1990
1991
1992
1993
1994
1995 -11.20%
1996 4.86%
1997 -4.53%
1998 -26.43%
1999 61.44%
</TABLE>
Best quarter during years shown: 4th quarter, 1999--27.28%
Worst quarter during years shown: 2nd quarter, 1998--(22.48)%
AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999
<TABLE>
<CAPTION>
MSCI
EMERGING
CLASS CLASS A CLASS B CLASS C CLASS Y MARKETS
(INCEPTION DATE) (1/19/94) (12/5/95) (1/19/94) (1/19/94) FREE INDEX
- ---------------- --------- --------- --------- --------- ----------
<S> <C> <C> <C> <C> <C>
One Year......................................... 54.20% 55.06% 58.85% 61.92% 66.41%
Five Years....................................... 0.17% N/A 0.26% 1.31% 2.00%
Life of Class.................................... (2.10)% 3.43% (2.13)% (1.12)% *
</TABLE>
- ---------
* Average annual total returns for the MSCI Emerging Markets Free Index for the
life of each class were as follows: Class A--0.08%; Class B--4.92%;
Class C--0.08%; and Class Y--0.08%.
- --------------------------------------------------------------------------------
Prospectus Page 13
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Emerging Markets Equity Fund
EXPENSES AND FEE TABLES
- --------------------------------------------------------------------------------
FEES AND EXPENSES These tables describe the fees and expenses that you may pay
if you buy and hold shares of the fund.
SHAREHOLDER TRANSACTION EXPENSES (fees paid directly from your investments)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases(as a % of
offering price)........................................... 4.5% None None None
Maximum Contingent Deferred Sales Charge (Load) (CDSC)
(as a % of offering price)................................ None 5% 1% None
Exchange Fee................................................ None None None None
</TABLE>
ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from fund assets)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Management Fees............................................. 1.20% 1.20% 1.20% 1.20%
Distribution and/or Service (12b-1) Fees.................... 0.25 1.00 1.00 None
Other Expenses.............................................. 2.11 2.30 2.23 2.26
---- ---- ---- ----
Total Annual Fund Operating Expenses........................ 3.56% 4.50% 4.43% 3.46%
Expense Reimbursement*...................................... 1.12 1.31 1.24 1.27
---- ---- ---- ----
Net Expenses*............................................... 2.44% 3.19% 3.19% 2.19%
==== ==== ==== ====
</TABLE>
- ---------
*The fund and Mitchell Hutchins have entered into a written expense
reimbursement agreement. Mitchell Hutchins is contractually obligated to
reimburse the fund to the extent that the fund's expenses through March 1, 2001
otherwise would exceed the "Net Expenses" rates for each class as shown above.
The fund has agreed to repay Mitchell Hutchins for those reimbursed expenses if
it can do so over the following three years without causing the fund's expenses
in any of those years to exceed those "Net Expenses" rates.
EXAMPLE
The following example is intended to help you compare the cost of investing in
the fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods unless
otherwise stated. The example also assumes that your investment has a 5% return
each year and that the fund's operating expenses remain the same, except for the
one-year period when the fund's expenses are lower due to its reimbursement
agreement with Mitchell Hutchins. Although your actual costs may be higher or
lower, based on these assumptions your costs would be:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Class A..................................................... $686 $1,393 $2,121 $4,035
Class B (assuming sales of all shares at end of period)..... 822 1,543 2,373 4,171
Class B (assuming no sales of shares)....................... 322 1,243 2,173 4,171
Class C (assuming sales of all shares at end of period)..... 422 1,229 2,146 4,486
Class C (assuming no sales of shares)....................... 322 1,229 2,146 4,486
Class Y..................................................... 222 945 1,689 3,654
</TABLE>
- --------------------------------------------------------------------------------
Prospectus Page 14
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
MORE ABOUT RISKS AND INVESTMENT
STRATEGIES
- --------------------------------------------------------------------------------
PRINCIPAL RISKS
The main risks of investing in the funds are described below. Not all of these
risks apply to each fund. You can find a list of the main risks that apply to a
particular fund by looking under the "Investment Objective, Strategies and
Risks" heading for that fund.
Other risks of investing in a fund, along with further detail about some of the
risks described below, are discussed in the funds' Statement of Additional
Information ("SAI"). Information on how you can obtain the SAI is on the back
cover of this prospectus.
CREDIT RISK. Credit risk is the risk that the issuer of a bond will not make
principal or interest payments when they are due. Even if an issuer does not
default on a payment, a bond's value may decline if the market believes that the
issuer has become less able, or less willing, to make payments on time. Even
high quality bonds are subject to some credit risk. However, credit risk is
greater for lower quality bonds. Bonds that are not investment grade involve
high credit risk and are considered speculative. Lower quality bonds may
fluctuate in value more than higher quality bonds and, during periods of market
volatility, may be more difficult to sell at the time and price a fund desires.
DERIVATIVES RISK. The value of "derivatives" - so-called because their value
"derives" from the value of an underlying asset, reference rate or index - may
rise or fall more rapidly than other investments. For some derivatives, it is
possible for a fund to lose more than the amount it invested in the derivative.
Options, futures contracts and forward currency contracts are examples of
derivatives. A fund's use of derivatives may not succeed for various reasons,
including unexpected changes in the values of the derivatives or the assets
underlying the derivatives. If a fund uses derivatives to adjust or "hedge" the
overall risk of its portfolio, it is possible that the hedge will not succeed if
changes in the value of the derivatives are not matched by opposite changes in
the value of the rest of the fund's portfolio.
EMERGING MARKETS RISK. Securities of issuers located in emerging market
countries are subject to all of the risks of other foreign securities (see
below). However, the level of those risks often is higher due to the fact that
social, political, legal and economic systems in emerging market countries may
be less fully developed and less stable than those in developed countries.
Emerging market securities also may be subject to additional risks, such as
lower liquidity and larger or more rapid changes in value.
EQUITY RISK. The prices of common stocks and other equity securities generally
fluctuate more than those of other investments. They reflect changes in the
issuing company's financial condition and changes in the overall market. A fund
may lose a substantial part, or even all, of its investment in a company's
stock.
FOREIGN INVESTING RISK. Foreign investing involves risks relating to political,
social and economic developments abroad to a greater extent than investing in
the securities of U.S. issuers. In addition, there are differences between U.S.
and foreign regulatory requirements and market practices. Foreign investments
denominated in foreign currencies are subject to the risk that the value of a
foreign currency will fall in relation to the U.S. dollar. Currency exchange
rates can be volatile and can be affected by, among other factors, the general
economics of a country, the actions of U.S. and foreign governments or central
banks, the imposition of currency controls and speculation.
INTEREST RATE RISK. The value of bonds generally can be expected to fall when
interest rates rise and to rise when interest rates fall. Interest rate risk is
the risk that interest rates will rise, so that the value of a fund's
investments in bonds will fall. Because interest rate risk is the primary risk
presented by U.S. government and other very high quality bonds, changes in
interest rates may actually have a larger effect on the value of those bonds
than on lower quality bonds.
NON-DIVERSIFIED STATUS RISK. Global Income Fund is non-diversified, which means
that it is not subject to certain limitations on its ability to invest more than
5% of its total assets in securities of a single issuer. When a fund holds a
large position in the securities of one issuer, changes in the financial
condition or in the market's assessment of that issuer may cause larger changes
in its total return and in the price of its shares than if the fund held only a
smaller position.
- --------------------------------------------------------------------------------
Prospectus Page 15
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
REGIONAL CONCENTRATION RISK. Asia Pacific Growth Fund invests primarily in
stocks of companies in the Asia Pacific Region (excluding Japan). As a result,
factors affecting this region will affect the value of the fund's investments
more than if the fund invested in several geographic areas. The Asia Pacific
Region countries in which the fund invests generally have less stable economies,
stock markets, currencies and political systems than countries in Europe or
North America. Also, countries in the Asia Pacific Region generally are heavily
dependent on international trade and on the availability of foreign capital.
This makes these countries more subject to external influences.
SECTOR ALLOCATION RISK. A fund's investment adviser or sub-adviser may not be
successful in choosing the best allocation among geographic or other market
sectors. A fund that allocates its assets among market sectors is more dependent
on its investment adviser's or sub-adviser's ability to successfully assess the
relative values in each sector than are funds that do not do so.
SOVEREIGN RISK. Investments in foreign government bonds involve special risks
because the investors may have limited legal recourse in the event of default.
Political conditions, especially a country's willingness to meet the terms of
its debt obligations, can be of considerable significance.
ADDITIONAL INVESTMENT STRATEGIES
DEFENSIVE POSITIONS; CASH RESERVES. To protect itself from adverse market
conditions, a fund may take a defensive position that is different from its
normal investment strategy. This means that the fund may temporarily invest a
larger-than-normal part, or even all, of its assets in cash or money market
instruments. Since these investments provide relatively low income, a defensive
position may not be consistent with achieving a fund's investment objective.
Each fund may invest up to 35% of its total assets in cash or money market
instruments as a cash reserve for liquidity or other purposes.
PORTFOLIO TURNOVER. Each fund may engage in frequent trading in order to
achieve its investment objective. Frequent trading may result in portfolio
turnover over 100% or more (high portfolio turnover).
Frequent trading may increase the portion of a fund's capital gains that are
realized for tax purposes in any given year. This may increase the fund's
taxable dividends in that year. Frequent trading also may increase the portion
of a fund's realized capital gains that are considered "short-term" for tax
purposes. Shareholders will pay higher taxes on dividends that represent short-
term gains than they would pay on dividends that represent long-term gains.
Frequent trading also may result in higher fund expenses due to transaction
costs.
The funds do not restrict the frequency of trading in order to limit expenses or
the tax effect that the fund's dividends may have on shareholders.
- --------------------------------------------------------------------------------
Prospectus Page 16
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
MANAGING YOUR FUND ACCOUNT
- --------------------------------------------------------------------------------
FLEXIBLE PRICING
The funds offer four classes of shares - Class A, Class B, Class C and Class Y.
Each class has different sales charges and ongoing expenses. You can choose the
class that is best for you, based on how much you plan to invest and how long
you plan to hold your fund investment. Class Y shares are only available to
certain types of investors.
Each fund has adopted a plan under rule 12b-1 for its Class A, Class B and
Class C shares that allows it to pay service fees for providing services to
shareholders and (for Class B and Class C shares) distribution fees for the sale
of its shares. Because the 12b-1 distribution fees for Class B and Class C
shares are paid out of a fund's assets on an ongoing basis, over time they will
increase the cost of your investment and may cost you more than if you paid a
front-end sales charge.
CLASS A SHARES
Class A shares have a front-end sales charge that is included in the offering
price of the Class A shares. This sales charge is not invested in the fund.
Class A shares pay an annual 12b-1 service fee of 0.25% of average net assets,
but they pay no 12b-1 distribution fees. The ongoing expenses for Class A shares
are lower than for Class B and Class C shares.
The Class A sales charges for each fund are described in the following tables.
CLASS A SALES CHARGES FOR: GLOBAL EQUITY FUND
ASIA PACIFIC GROWTH FUND
EMERGING MARKETS EQUITY FUND
<TABLE>
<CAPTION>
SALES CHARGE AS A PERCENTAGE OF: DISCOUNT TO SELECTED DEALERS AS
AMOUNT OF INVESTMENT OFFERING PRICE NET AMOUNT INVESTED PERCENTAGE OF OFFERING PRICE
- -------------------- -------------- ------------------- -------------------------------
<S> <C> <C> <C>
Less than $50,000............................ 4.50% 4.71% 4.25%
$50,000 to $99,999........................... 4.00 4.17 3.75
$100,000 to $249,999......................... 3.50 3.63 3.25
$250,000 to $499,999......................... 2.50 2.56 2.25
$500,000 to $999,999......................... 1.75 1.78 1.50
$1,000,000 and over (1)...................... None None 1.00(2)
</TABLE>
CLASS A SALES CHARGES FOR: GLOBAL INCOME FUND
<TABLE>
<S> <C> <C> <C>
Less than $100,000........................... 4.00% 4.17% 3.75%
$100,000 to $249,999......................... 3.00 3.09 2.75
$250,000 to $499,999......................... 2.25 2.30 2.00
$500,000 to $999,999......................... 1.75 1.78 1.50
$1,000,000 and over(1)....................... None None 1.00(2)
</TABLE>
- ---------
(1) A contingent deferred sales charge of 1% of the shares' offering price or
the net asset value at the time of sale by the shareholder, whichever is
less, is charged on sales of shares made within one year of the purchase
date. Class A shares representing reinvestment of dividends are not subject
to this 1% charge. Withdrawals in the first year after purchase of up to 12%
of the value of the fund account under the funds' Systematic Withdrawal Plan
are not subject to this charge.
(2) Mitchell Hutchins pays 1% to PaineWebber.
SALES CHARGE REDUCTIONS AND WAIVERS. You may qualify for a lower sales charge
if you already own Class A shares of a PaineWebber mutual fund. You can combine
the value of Class A shares that you own in other PaineWebber funds and the
purchase amount of the Class A shares of the PaineWebber fund that you are
buying.
- --------------------------------------------------------------------------------
Prospectus Page 17
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
You may also qualify for a lower sales charge if you combine your purchases with
those of:
- - your spouse, parents or children under age 21;
- - your Individual Retirement Accounts (IRAs);
- - certain employee benefit plans, including 401(k) plans;
- - a company that you control;
- - a trust that you created;
- - Uniform Gifts to Minors Act/Uniform Transfers to Minors Act accounts created
by you or by a group of investors for your children; or
- - accounts with the same adviser.
You may qualify for a complete waiver of the sales charge if you:
- - Are an employee of PaineWebber or its affiliates or the spouse, parent or
child under age 21 of a PaineWebber employee;
- - Buy these shares through a PaineWebber Financial Advisor who was formerly
employed as an investment executive with a competing brokerage firm that was
registered as a broker-dealer with the SEC, and
-- you were the Financial Advisor's client at the competing brokerage firm;
-- within 90 days of buying shares in a fund, you sell shares of one or more
mutual funds that were principally underwritten by the competing brokerage
firm or its affiliates, and you either paid a sales charge to buy those
shares, pay a contingent deferred sales charge when selling them or held
those shares until the contingent deferred sales charge was waived; and
-- you purchase an amount that does not exceed the total amount of money you
received from the sale of the other mutual fund;
- - Acquire these shares through the reinvestment of dividends of a PaineWebber
unit investment trust;
- - Are a 401(k) or 403(b) qualified employee benefit plan with 50 or more
eligible employees in the plan or at least $1 million in assets;
- - Are a participant in the PaineWebber Members Only-SM- Program. For investments
made pursuant to this waiver, Mitchell Hutchins may make payments out of its
own resources to PaineWebber and to participating membership organizations in
a total amount not to exceed 1% of the amount invested; or
- - Acquire these shares through a PaineWebber InsightOne-SM- Program brokerage
account.
NOTE: See the funds' SAI for some other sales charge waivers. If you think you
qualify for any sales charge reductions or waivers, you will need to provide
documentation to PaineWebber or the fund. For more information, you should
contact your PaineWebber Financial Advisor or correspondent firm or call
1-800-647-1568. If you want information on the funds' Systematic Withdrawal
Plan, see the SAI or contact your PaineWebber Financial Advisor or correspondent
firm.
CLASS B SHARES
Class B shares have a contingent deferred sales charge. When you purchase Class
B shares, we invest 100% of your purchase in fund shares. However, you may have
to pay the deferred sales charge when you sell your fund shares, depending on
how long you own the shares.
Class B shares pay an annual 12b-1 distribution fee of 0.75% of average net
assets, as well as an annual 12b-1 service fee of 0.25% of average net assets.
If you hold your Class B shares for six years, they will automatically convert
to Class A shares, which have lower ongoing expenses.
If you sell Class B shares before the end of six years, you will pay a deferred
sales charge. We calculate the deferred sales charge by multiplying the lesser
of the net asset value of the Class B shares at the time of purchase or the net
asset value at the time of sale by the percentage shown below:
<TABLE>
<CAPTION>
PERCENTAGE BY WHICH
IF YOU SELL THE SHARES' NET ASSET
SHARES WITHIN: VALUE IS MULTIPLIED:
- -------------- ---------------------
<S> <C>
1st year since purchase........ 5%
2nd year since purchase........ 4
3rd year since purchase........ 3
4th year since purchase........ 2
5th year since purchase........ 2
6th year since purchase........ 1
7th year since purchase........ None
</TABLE>
We will not impose the deferred sales charge on Class B shares representing
reinvestment of dividends or on withdrawals in any year of up to 12% of the
value of your Class B shares under the Systematic Withdrawal Plan.
To minimize the deferred sales charge, we will assume that you are selling:
- - First, Class B shares representing reinvested dividends and
- - Second, Class B shares that you have owned the longest.
- --------------------------------------------------------------------------------
Prospectus Page 18
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
SALES CHARGE WAIVERS. You may qualify for a waiver of the deferred sales charge
on a sale of shares if:
- - You participate in the Systematic Withdrawal Plan;
- - You are older than 59 1/2 and are selling shares to take a distribution from
certain types of retirement plans;
- - You receive a tax-free return of an excess IRA contribution;
- - You receive a tax-qualified retirement plan distribution following retirement;
- - The shares are sold within one year of your death and you owned the shares
either (1) as the sole shareholder or (2) with your spouse as a joint tenant
with the right of survivorship; or
- - You are eligible to invest in certain offshore investment pools offered by
PaineWebber, your shares are sold before March 31, 2000, and the proceeds are
used to purchase interests in one or more of those pools.
NOTE: If you think you qualify for any of these sales charge waivers, you will
need to provide documentation to PaineWebber or the fund. For more information,
you should contact your PaineWebber Financial Advisor or correspondent firm or
call 1-800-647-1568. If you want information on the Systematic Withdrawal Plan,
see the SAI or contact your PaineWebber Financial Advisor or correspondent firm.
CLASS C SHARES
Class C shares have a level load sales charge in the form of ongoing 12b-1
distribution fees. When you purchase Class C shares, we will invest 100% of your
purchase in fund shares.
Class C shares pay an annual 12b-1 distribution fee of 0.75% (0.50% for Global
Income Fund) of average net assets, as well as an annual 12b-1 service fee of
0.25% of average net assets. Class C shares do not convert to another class of
shares. This means that you will pay the 12b-1 fees for as long as you own your
shares.
Class C shares also have a contingent deferred sales charge. You may have to pay
the deferred sales charge if you sell your shares within one year of the date
you purchased them. We calculate the deferred sales charge on sales of Class C
shares by multiplying 1.00% (0.75% for Global Income Fund) by the lesser of the
net asset value of the Class C shares at the time of purchase or the net asset
value at the time of sale. We will not impose the deferred sales charge on Class
C shares representing reinvestment of dividends or on withdrawals, in the first
year after purchase, of up to 12% of the value of your Class C shares under the
Systematic Withdrawal Plan.
You may be eligible to sell your shares without paying a contingent deferred
sales charge if you:
- - Are a 401(k) or 403(b) qualified employee benefit plan with fewer than 100
employees or less than $1 million in assets; or
- - Are eligible to invest in certain offshore investment pools offered by
PaineWebber, your shares are sold before March 31, 2000 and the proceeds are
used to purchase interests in one or more of these pools.
NOTE: If you think you qualify for any of these sales charge waivers, you may
need to provide documentation to PaineWebber or the funds. For more information,
you should contact your PaineWebber Financial Advisor or correspondent firm or
call 1-800-647-1568.
If you want information on the funds' Systematic Withdrawal Plan, see the SAI or
contact your PaineWebber Financial Advisor or correspondent firm.
CLASS Y SHARES
Class Y shares have no sales charge. Only specific types of investors can
purchase Class Y shares. You may be eligible to purchase Class Y shares if you:
- - Buy shares through PaineWebber's PACE-SM- Multi-Advisor Program;
- - Buy $10 million or more of PaineWebber fund shares at any one time;
- - Are a qualified retirement plan with 5,000 or more eligible employees or $50
million in assets; or
- - Are an investment company advised by PaineWebber or an affiliate of
PaineWebber.
The trustee of PaineWebber's 401(k) Plus Plan for its employees is also eligible
to purchase Class Y shares.
Class Y shares do not pay ongoing sales or distribution fees or sales charges.
The ongoing expenses for Class Y shares are the lowest for all the classes.
BUYING SHARES
If you are a PaineWebber client, or a client of a PaineWebber correspondent
firm, you can purchase fund shares through your Financial Advisor. Otherwise,
you can invest in the funds through the funds' transfer agent, PFPC Inc. You can
obtain an application by calling 1-800-647-1568. You must complete and sign the
application and mail it, along with a check, to:
PFPC Inc.
Attn.: PaineWebber Mutual Funds
P.O. Box 8950
Wilmington, DE 19899.
- --------------------------------------------------------------------------------
Prospectus Page 19
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
If you wish to invest in other PaineWebber Funds, you can do so by:
- - Contacting your Financial Advisor (if you have an account at PaineWebber or at
a PaineWebber correspondent firm);
- - Mailing an application with a check; or
- - Opening an account by exchanging shares from another PaineWebber fund.
You do not have to complete an application when you make additional investments
in the same fund.
The funds and Mitchell Hutchins reserve the right to reject a purchase order or
suspend the offering of shares.
<TABLE>
<CAPTION>
MINIMUM INVESTMENTS:
<S> <C>
To open an account........... $1,000
To add to an account......... $ 100
</TABLE>
Each fund may waive or reduce these amounts for:
- - Employees of PaineWebber or its affiliates; or
- - Participants in certain pension plans, retirement accounts, unaffiliated
investment programs or the funds' automatic investment plans.
FREQUENT TRADING. The interests of a fund's long-term shareholders and its
ability to manage its investments may be adversely affected when its shares are
repeatedly bought and sold in response to short-term market fluctuations -- also
known as "market timing." When large dollar amounts are involved, the fund may
have difficulty implementing long-term investment strategies because it cannot
predict how much cash it will have to invest. Market timing also may force the
fund to sell portfolio securities at disadvantageous times to raise the cash
needed to buy a market timer's fund shares. These factors may hurt the fund's
performance and its shareholders. When Mitchell Hutchins believes frequent
trading would have a disruptive effect on a fund's ability to manage its
investments, Mitchell Hutchins and the fund may reject purchase orders and
exchanges into the fund by any person, group or account that Mitchell Hutchins
believes to be a market timer. A fund may notify the market timer that a
purchase order or an exchange has been rejected after the day on which the order
is placed.
SELLING SHARES
You can sell your fund shares at any time. If you own more than one class of
shares, you should specify which class you want to sell. If you do not, the fund
will assume that you want to sell shares in the following order: Class A, then
Class C, then Class B and last, Class Y.
If you want to sell shares that you purchased recently, the fund may delay
payment until it verifies that it has received good payment. If you purchased
shares by check, this can take up to 15 days.
If you have an account with PaineWebber or a PaineWebber correspondent firm, you
can sell shares by contacting your Financial Advisor.
If you do not have an account at PaineWebber or a correspondent firm, and you
bought your shares through the transfer agent, you can sell your shares by
writing to the fund's transfer agent. Your letter must include:
- - Your name and address;
- - The fund's name;
- - The fund account number;
- - The dollar amount or number of shares you want to sell; and
- - A guarantee of each registered owner's signature. A signature guarantee may be
obtained from a domestic bank or trust company, broker, dealer, clearing
agency or savings association that is a participant in one of the medallion
programs recognized by the Securities Transfer Agents Association. These are:
Securities Transfer Agents Medallion Program (STAMP), Stock Exchanges
Medallion Program (SEMP) and the New York Stock Exchange Medallion Signature
Program (MSP). The funds will not accept signature guarantees that are not a
part of these programs.
Mail the letter to:
PFPC Inc.
Attn.: PaineWebber Mutual Funds
P.O. Box 8950
Wilmington, DE 19899.
If you sell Class A shares and then repurchase Class A shares of the same fund
within 365 days of the sale, you can reinstate your account without paying a
sales charge.
It costs each fund money to maintain shareholder accounts. Therefore, the funds
reserve the right to repurchase all shares in any account that has a net asset
value of less than $500. If a fund elects to do this with your account, it will
notify you that you can increase the amount invested to $500 or more within 60
days. A fund will not repurchase shares in accounts that fall below $500 solely
because of a decrease in the fund's net asset value.
EXCHANGING SHARES
You may exchange Class A, Class B or Class C shares of each fund for shares of
the same class of most other PaineWebber funds. You may not exchange Class Y
shares.
- --------------------------------------------------------------------------------
Prospectus Page 20
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
You will not pay either a front-end sales charge or a deferred sales charge when
you exchange shares. However, you may have to pay a deferred sales charge if you
later sell the shares you acquired in the exchange. Each fund will use the date
that you purchased the shares in the first fund to determine whether you must
pay a deferred sales charge when you sell the shares in the acquired fund.
Other PaineWebber funds may have different minimum investment amounts. You may
not be able to exchange your shares if your exchange is not as large as the
minimum investment amount in that other fund.
You may exchange shares of one fund for shares of another fund only after the
first purchase has settled and the first fund has received your payment.
PAINEWEBBER AND CORRESPONDENT FIRM CLIENTS. If you bought your shares through
PaineWebber or a correspondent firm, you may exchange your shares by placing an
order with your Financial Advisor.
OTHER INVESTORS. If you are not a PaineWebber or correspondent firm client, you
may exchange your shares by writing to the fund's transfer agent. You must
include:
- - Your name and address;
- - The name of the fund whose shares you are selling and the name of the fund
whose shares you want to buy;
- - Your account number;
- - How much you are exchanging (by dollar amount or by number of shares to be
sold); and
- - A guarantee of your signature. (See "Selling Shares" for information on
obtaining a signature guarantee.)
Mail the letter to:
PFPC Inc.
Attn.: PaineWebber Mutual Funds
P.O. Box 8950
Wilmington, DE 19899.
A fund may modify or terminate the exchange privilege at any time.
PRICING AND VALUATION
The price at which you may buy, sell or exchange fund shares is based on net
asset value per share. Each fund calculates net asset value on days that the New
York Stock Exchange is open. Each fund calculates net asset value separately for
each class as of the close of regular trading on the NYSE (generally,
4:00 p.m., Eastern time). The NYSE normally is not open, and the funds do not
price their shares, on most national holidays and on Good Friday. If trading on
the NYSE is halted for the day before 4:00 p.m., Eastern time, the fund's net
asset value per share will be calculated as of the time trading was halted.
Your price for buying, selling or exchanging shares will be based on the net
asset value that is next calculated after the fund accepts your order. If you
place your order through PaineWebber, your PaineWebber Financial Advisor is
responsible for making sure that your order is promptly sent to the fund.
You should keep in mind that a front-end sales charge may be applied to your
purchase if you buy Class A shares. A deferred sales charge may be applied when
you sell Class B or Class C shares.
Each fund calculates its net asset value based on the current market value for
its portfolio securities. The funds normally obtain market values for their
securities from independent pricing services that use reported last sales
prices, current market quotations or valuations from computerized "matrix"
systems that derive values based on comparable securities. If a market value is
not available from an independent pricing source for a particular security, that
security is valued at a fair value determined by or under the direction of the
fund's board. The funds normally use the amortized cost method to value bonds
that will mature in 60 days or less.
Judgment plays a greater role in valuing thinly traded securities, including
many lower-rated bonds, because there is less reliable, objective data
available.
The funds calculate the U.S. dollar value of investments that are denominated in
foreign currencies daily, based on current exchange rates. A fund may own
securities, including some securities that trade primarily in foreign markets,
that trade on weekends or other days on which a fund does not calculate net
asset value. As a result, a fund's net asset value may change on days when you
will not be able to buy and sell fund shares. If a fund concludes that a
material change in the value of a foreign security has occurred after the close
of trading in its principal foreign market but before the close of regular
trading on the NYSE, the fund may use fair value methods to reflect those
changes. This policy is intended to assure that the fund's net asset value
fairly reflects security values as of the time of pricing.
- --------------------------------------------------------------------------------
Prospectus Page 21
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
MANAGEMENT
- --------------------------------------------------------------------------------
INVESTMENT ADVISERS
Mitchell Hutchins Asset Management Inc. is the investment adviser and
administrator of the funds. Mitchell Hutchins is located at 51 West 52(nd)
Street, New York, New York 10019-6114, and is a wholly owned asset management
subsidiary of PaineWebber Incorporated, which is wholly owned by Paine Webber
Group Inc., a publicly owned financial services holding company. On January 31,
2000, Mitchell Hutchins was adviser or sub-adviser of 31 investment companies
with 75 separate portfolios and aggregate assets of approximately $52.7 billion.
Invista Capital Management, LLC is the sub-adviser for Global Equity Fund's
foreign investments. It is located at 1800 Hub Tower, 699 Walnut, Des Moines,
Iowa 50309. As of December 31, 1999, Invista managed approximately $35.3 billion
in client assets.
Schroder Investment Management North America Inc. is the sub-adviser to Asia
Pacific Growth Fund and Emerging Markets Equity Fund. SIMNA is located at 787
Avenue of the Americas, New York, New York 10019. As of June 30, 1999, SIMNA and
its affiliates had approximately $208 billion in assets under management.
PORTFOLIO MANAGERS
GLOBAL EQUITY FUND. Mitchell Hutchins is responsible for allocating Global
Equity Fund's assets between U.S. and foreign markets and for managing its U.S.
investments. Since October 1, 1998, T. Kirkham Barneby has been responsible for
the fund's asset allocation decisions. Mr. Barneby is a managing director and
chief investment officer for quantitative investments of Mitchell Hutchins.
Mark A. Tincher has been primarily responsible for the day-to-day management of
the fund's U.S. investments since October 1, 1998. Mr. Tincher is a managing
director and chief investment officer for equities of Mitchell Hutchins. Prior
to joining Mitchell Hutchins in 1995, Mr. Tincher worked for Chase Manhattan
Private Bank, where he was a vice president and directed the U.S. funds
management and equity research area and oversaw the management of all Chase
equity funds.
Scott D. Opsal and Kurtis D. Spieler have been primarily responsible for the
day-to-day management of the fund's foreign investments since October 1, 1998,
when Invista was appointed as the fund's sub-adviser for foreign investments.
Mr. Opsal is an executive vice president and chief investment officer of
Invista, where he has been employed since 1986. Mr. Spieler is a portfolio
manager specializing in the management of international equity portfolios and
serves as the lead manager for Invista's dedicated emerging market portfolios.
He has been employed by Invista since 1994.
GLOBAL INCOME FUND. Stuart Waugh and William King are primarily responsible for
the day-to-day management of Global Income Fund. Mr. Waugh has been involved
with the fund since its inception, first as an analyst and then as portfolio
manager since 1993. Mr. Waugh is a managing director of Mitchell Hutchins
responsible for global fixed income investments and currency trading. Mr. Waugh
has been with Mitchell Hutchins since 1983. Mr. King joined Mitchell Hutchins in
November 1995 and assumed his present responsibilities with the fund in 1997.
Prior to 1995, he was at IBM Corporation, where he was responsible for the
management of IBM Pension Fund's global bond portfolio. Both Mr. Waugh and
Mr. King are Chartered Financial Analysts.
Other members of Mitchell Hutchins' international fixed income group provide
information on market outlook, interest rate forecasts and other factors
affecting global fixed income investments.
ASIA PACIFIC GROWTH FUND. Louise Croset and Heather Crighton, with the
assistance of SIMNA's Asia Pacific Region investment committee, have been
primarily responsible for the day-to-day management of Asia Pacific Growth Fund
since its inception. Ms. Croset is a senior vice president and director of SIMNA
and has been with the firm since 1993. She has managed Asia Pacific Region
stocks for the past 15 years. Ms. Crighton is a senior vice president and a
director of SIMNA and has also been with the firm since 1993. She has managed
Asia Pacific Region stocks for the past 11 years.
- --------------------------------------------------------------------------------
Prospectus Page 22
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
EMERGING MARKETS EQUITY FUND. John A. Troiano, Ms. Crighton and Mark Bridgeman,
with the assistance of SIMNA's emerging markets investment committee, have been
primarily responsible for the day-to-day management of Emerging Markets Equity
Fund since SIMNA was appointed sub-adviser on February 25, 1997. Mr. Troiano is
the chief executive and a director of SIMNA and has been employed by various
affiliates of SIMNA in the portfolio management area since 1986. He is currently
chairman of SIMNA's emerging markets investment committee. Ms. Crighton is a
senior vice president and a director of SIMNA and has been with the firm since
1993. Mr. Bridgeman joined SIMNA in 1990 and is a first vice president and
international fund manager of the firm.
ADVISORY FEES
The funds paid advisory fees to Mitchell Hutchins for the most recent fiscal
year at the following annual contract rates of average daily net assets:
<TABLE>
<S> <C>
Global Equity Fund....................... 0.85%
Global Income Fund....................... 0.75%
Asia Pacific Growth Fund................. 1.20%
Emerging Markets Equity Fund............. 1.20%
</TABLE>
OTHER INFORMATION
The funds have received an exemptive order from the SEC that permits their
boards to appoint and replace sub-advisers and to amend sub-advisory contracts
without obtaining shareholder approval. A fund's shareholders must approve this
policy before its board may implement it. The shareholders of Global Equity Fund
have approved this policy. As of March 1, 2000, the shareholders of the other
funds have not been asked to do so.
- --------------------------------------------------------------------------------
DIVIDENDS AND TAXES
- --------------------------------------------------------------------------------
DIVIDENDS
Global Income Fund normally declares and pays dividends monthly, and it
distributes substantially all of its gains, if any, annually. The other funds
normally declare and pay dividends and distribute any gains annually.
Classes with higher expenses are expected to have lower dividends. For example,
Class B shares are expected to have the lowest dividends of any class of a
fund's shares, while Class Y shares are expected to have the highest.
You will receive dividends in additional shares of the same class unless you
elect to receive them in cash. Contact your Financial Advisor at PaineWebber or
one of its corresponding firms if you prefer to receive dividends in cash.
TAXES
The dividends that you receive from a fund generally are subject to federal
income tax regardless of whether you receive them in additional fund shares or
in cash. If you hold fund shares through a tax-exempt account or plan, such as
an IRA or 401(k) plan, dividends on your shares generally will not be subject to
tax.
When you sell fund shares, you generally will be subject to federal income tax
on any gain you realize. If you exchange any fund's shares for shares of another
PaineWebber mutual fund, the transaction will be treated as a sale of the first
fund's shares, and any gain will be subject to federal income tax.
Global Income Fund expects that its dividends will be taxed primarily as
ordinary income. The other funds expect that their dividends will be comprised
primarily of capital gain distributions. The distribution of capital gains may
be taxed at a lower rate than ordinary income, depending on whether the fund
held the assets that generated the gains for more than 12 months. Your fund will
tell you how you should treat its dividends for tax purposes.
- --------------------------------------------------------------------------------
Prospectus Page 23
<PAGE>
- --------------------------------------------------------------------------------
--------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The following financial highlights tables are intended to help you understand
the funds' financial performance for the past 5 years. Shorter periods are shown
for funds or classes of fund shares that have existed for less than 5 years.
Certain information reflects financial results for a single fund share. In the
tables, "total investment return" represents the rate that an investor would
have earned (or lost) on an investment in a fund (assuming reinvestment of all
dividends).
The information in the financial highlights has been audited for Global Equity
Fund, Asia Pacific Growth Fund and Emerging Markets Equity Fund by Ernst & Young
LLP, independent auditors, and for Global Income Fund by PricewaterhouseCoopers
LLP, independent accountants. The reports of the funds' independent auditors or
independent accountants, along with the funds' financial statements, are
included in the funds' Annual Reports to Shareholders. Annual Reports may be
obtained without charge by calling 1-800-647-1568.
<TABLE>
<CAPTION>
GLOBAL EQUITY FUND
-----------------------------------------------------------------
CLASS A
-----------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED TWO MONTHS FOR THE YEARS ENDED
OCTOBER 31, ENDED AUGUST 31,
------------------------------ OCTOBER 31, -------------------
1999 1998# 1997 1996 1996 1995**
-------- -------- -------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period.......................... $ 16.27 $ 18.37 $ 17.43 $ 16.81 $ 16.12 $ 16.98
-------- -------- -------- -------- -------- --------
Net investment income (loss)...... 0.08@ 0.03@ 0.00 (0.02) 0.02 0.02
Net realized and unrealized gains
(losses) from investments and
foreign currency................ 2.38@ 0.35@ 1.52 0.64 1.24 0.37
-------- -------- -------- -------- -------- --------
Net increase (decrease) from
investment operations........... 2.46 0.38 1.52 0.62 1.26 0.39
-------- -------- -------- -------- -------- --------
Dividends from net investment
income.......................... (0.02) -- -- -- -- --
Distributions from net realized
gains from investment
transactions.................... (0.81) (2.48) (0.58) -- (0.57) (1.25)
-------- -------- -------- -------- -------- --------
Total dividends and distributions
to shareholders................. (0.83) (2.48) (0.58) -- (0.57) (1.25)
-------- -------- -------- -------- -------- --------
Net asset value, end of period.... $ 17.90 $ 16.27 $ 18.37 $ 17.43 $ 16.81 $ 16.12
======== ======== ======== ======== ======== ========
Total investment return (1)....... 15.56% 2.53% 8.87% 3.69% 8.06% 3.24%
======== ======== ======== ======== ======== ========
Ratios/Supplemental Data:
Net assets, end of period
(000's)......................... $235,341 $251,680 $294,878 $307,267 $305,218 $360,652
Expenses to average net assets,
net of waivers from adviser
(3)............................. 1.56% 1.55% 1.44% 1.53%* 1.48% 1.71%(2)
Net investment income (loss) to
average net assets, net of
waivers from adviser (3)........ 0.45% 0.17% 0.01% (0.80)%* 0.10% 0.09%(2)
Portfolio turnover rate........... 72% 151% 86% 3% 33% 40%
<CAPTION>
GLOBAL EQUITY FUND
------------------------------------------------------------------------
CLASS B
------------------------------------------------------------------------
FOR THE FOR THE FOR THE PERIOD
FOR THE YEARS ENDED TWO MONTHS YEAR AUGUST 25,
OCTOBER 31, ENDED ENDED 1995++
---------------------------- OCTOBER 31, AUGUST 31, TO AUGUST 31,
1999 1998# 1997 1996 1996 1995**
------- ------- --------- ----------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period.......................... $ 15.43 $ 17.69 $ 16.93 $ 16.35 $ 15.82 $ 15.83
------- ------- -------- -------- -------- --------
Net investment income (loss)...... (0.06)@ (0.12)@ (0.21) (0.05) (0.12) 0.00
Net realized and unrealized gains
(losses) from investments and
foreign currency................ 2.25@ 0.34@ 1.55 0.63 1.22 (0.01)
------- ------- -------- -------- -------- --------
Net increase (decrease) from
investment operations........... 2.19 0.22 1.34 0.58 1.10 (0.01)
------- ------- -------- -------- -------- --------
Dividends from net investment
income.......................... -- -- -- -- -- --
Distributions from net realized
gains from investment
transactions.................... (0.81) (2.48) (0.58) -- (0.57) --
------- ------- -------- -------- -------- --------
Total dividends and distributions
to shareholders................. (0.81) (2.48) (0.58) -- (0.57) --
------- ------- -------- -------- -------- --------
Net asset value, end of period.... $ 16.81 $ 15.43 $ 17.69 $ 16.93 $ 16.35 $ 15.82
======= ======= ======== ======== ======== ========
Total investment return (1)....... 14.63% 1.62% 8.05% 3.55% 7.18% (0.06)%
======= ======= ======== ======== ======== ========
Ratios/Supplemental Data:
Net assets, end of period
(000's)......................... $27,435 $52,709 $ 87,104 $113,445 $113,235 $142,880
Expenses to average net assets,
net of waivers from adviser
(3)............................. 2.42% 2.38% 2.26% 2.34%* 2.25% 2.17%*(2)
Net investment income (loss) to
average net assets, net of
waivers from adviser (3)........ (0.40)% (0.74)% (0.80)% (1.61)%* (0.68)% (1.92)%*(2)
Portfolio turnover rate........... 72% 151% 86% 3% 33% 40%
</TABLE>
- ---------------
* Annualized
** Investment advisory functions for the Fund were transferred from Kidder
Peabody Asset Management Inc. to Mitchell Hutchins on February 13, 1995.
# Effective October 1, 1998, Invista Capital Management, Inc. began
overseeing the day-to-day management of the foreign portion of the Fund's
assets and Mitchell Hutchins allocates the portfolio between domestic and
foreign investments and manages the domestic portion of the Fund's assets.
@ Calculated using the average monthly shares outstanding for the period.
++ Commencement of offering of shares.
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends and other
distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of each period reported. The figures do
not include any applicable sales charges or program fees; results would be
lower if they were included. Total investment returns for periods of less
than a year have not been annualized.
(2) These ratios include non-recurring acquisition expenses of 0.06% for
Class A, C and Y shares and 0.00% for Class B shares.
(3) During the year ended October 31, 1999 Mitchell Hutchins waived a portion
of its advisory and administration fees. The ratios excluding the waiver
would be the same since the fee waiver represents less than 0.005%.
- --------------------------------------------------------------------------------
Prospectus Page 24
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund
<TABLE>
<CAPTION>
GLOBAL EQUITY FUND
------------------------------------------------------------------
CLASS C
------------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED TWO MONTHS FOR THE YEARS ENDED
OCTOBER 31, ENDED AUGUST 31,
------------------------------ OCTOBER 31, --------------------
1999 1998# 1997 1996 1996 1995**
-------- -------- -------- ----------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 15.45 $ 17.69 $ 16.93 $ 16.35 $ 15.82 $ 16.81
-------- -------- -------- -------- -------- -------
Net investment income (loss)................. (0.05)@ (0.11)@ (0.23) (0.05) (0.13) (0.11)
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.25@ 0.35@ 1.57 0.63 1.23 0.37
-------- -------- -------- -------- -------- -------
Net increase (decrease) from investment
operations................................. 2.20 0.24 1.34 0.58 1.10 0.26
-------- -------- -------- -------- -------- -------
Dividends from net investment income......... -- -- -- -- -- --
Distributions from net realized gains from
investment transactions.................... (0.81) (2.48) (0.58) -- (0.57) (1.25)
-------- -------- -------- -------- -------- -------
Total dividends and distributions to
shareholders............................... (0.81) (2.48) (0.58) -- (0.57) (1.25)
-------- -------- -------- -------- -------- -------
Net asset value, end of period............... $ 16.84 $ 15.45 $ 17.69 $ 16.93 $ 16.35 $ 15.82
======== ======== ======== ======== ======== =======
Total investment return (1).................. 14.67% 1.74% 8.05% 3.55% 7.18% 2.46%
======== ======== ======== ======== ======== =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $ 32,917 $ 41,103 $ 54,510 $ 67,530 $ 66,585 $83,485
Expenses to average net assets, net of
waivers from adviser (3)................... 2.34% 2.32% 2.20% 2.30%* 2.27% 2.48% (2)
Net investment income (loss) to average net
assets, net of waivers from adviser (3).... (0.33)% (0.65)% (0.75)% (1.57)%* (0.70)% (0.68)%(2)
Portfolio turnover rate...................... 72% 151% 86% 3% 33% 40%
<CAPTION>
GLOBAL EQUITY FUND
----------------------------------------------------------------
CLASS Y
----------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED TWO MONTHS FOR THE YEARS ENDED
OCTOBER 31, ENDED AUGUST 31,
---------------------------- OCTOBER 31, -------------------
1999 1998# 1997 1996 1996 1995**
------- ------- --------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 16.59 $ 18.63 $ 17.60 $ 16.97 $ 16.22 $ 17.03
------- ------- -------- -------- -------- --------
Net investment income (loss)................. 0.14@ 0.09@ 0.10 (0.01) 0.07 0.07
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.43@ 0.35@ 1.51 0.64 1.25 0.37
------- ------- -------- -------- -------- --------
Net increase (decrease) from investment
operations................................. 2.57 0.44 1.61 0.63 1.32 0.44
------- ------- -------- -------- -------- --------
Dividends from net investment income......... (0.04) -- -- -- -- --
Distributions from net realized gains from
investment transactions.................... (0.81) (2.48) (0.58) -- (0.57) (1.25)
------- ------- -------- -------- -------- --------
Total dividends and distributions to
shareholders............................... (0.85) (2.48) (0.58) -- (0.57) (1.25)
------- ------- -------- -------- -------- --------
Net asset value, end of period............... $ 18.31 $ 16.59 $ 18.63 $ 17.60 $ 16.97 $ 16.22
======= ======= ======== ======== ======== ========
Total investment return (1).................. 15.97% 2.86% 9.31% 3.71% 8.39% 3.54%
======= ======= ======== ======== ======== ========
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $53,334 $51,025 $ 57,683 $ 63,225 $ 61,736 $ 57,150
Expenses to average net assets, net of
waivers from adviser (3)................... 1.23% 1.21% 1.10% 1.18%* 1.17% 1.46%(2)
Net investment income (loss) to average net
assets, net of waivers from adviser (3).... 0.79% 0.50% 0.36% (0.45)%* 0.46% 0.36%(2)
Portfolio turnover rate...................... 72% 151% 86% 3% 33% 40%
</TABLE>
- ---------------
- --------------------------------------------------------------------------------
Prospectus Page 25
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Income Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL INCOME FUND
----------------------------------------------------
CLASS A
----------------------------------------------------
FOR THE YEARS ENDED OCTOBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $ 10.58 $ 10.27 $ 10.46 $ 10.35 $ 9.99
-------- -------- -------- -------- --------
Net investment income@....................... 0.57 0.62 0.69 0.72 0.77
Net realized and unrealized gains (losses)
from investments and foreign currency@..... (0.82) 0.32 (0.19) 0.13 0.31
-------- -------- -------- -------- --------
Net increase (decrease) from investment
transactions............................... (0.25) 0.94 0.50 0.85 1.08
-------- -------- -------- -------- --------
Dividends from net investment income......... (0.33) (0.50) (0.54) (0.74) (0.72)
Distributions in excess of net investment
income..................................... (0.07) (0.05) (0.06) -- --
Distributions from paid-in capital........... (0.17) (0.08) (0.09) -- --
-------- -------- -------- -------- --------
Total dividends and distributions to
shareholders............................... (0.57) (0.63) (0.69) (0.74) (0.72)
-------- -------- -------- -------- --------
Net asset value, end of year................. $ 9.76 $ 10.58 $ 10.27 $ 10.46 $ 10.35
======== ======== ======== ======== ========
Total investment return(1)................... (2.44)% 9.51% 4.99% 8.60% 11.09%
======== ======== ======== ======== ========
Ratio/Supplemental data:
Net assets, end of year (000's).............. $314,475 $408,190 $486,718 $549,932 $663,022
Expenses to average net assets, net of
waivers from adviser(3).................... 1.19% 1.24% 1.21% 1.27% 1.24%(2)
Net investment income to average net assets,
net of waivers from adviser(3)............. 5.58% 6.07% 6.66% 6.88% 7.47%(2)
Portfolio turnover rate...................... 63% 93% 172% 126% 113%
<CAPTION>
GLOBAL INCOME FUND
--------------------------------------------------------
CLASS B
--------------------------------------------------------
FOR THE YEARS ENDED OCTOBER 31,
--------------------------------------------------------
1999 1998 1997 1996 1995
------- ------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $ 10.54 $ 10.24 $ 10.44 $ 10.31 $ 9.96
------- ------- -------- ---------- ----------
Net investment income@....................... 0.48 0.51 0.58 0.64 0.69
Net realized and unrealized gains (losses)
from investments and foreign currency@..... (0.82) 0.33 (0.17) 0.15 0.30
------- ------- -------- ---------- ----------
Net increase (decrease) from investment
transactions............................... (0.34) 0.84 0.41 0.79 0.99
------- ------- -------- ---------- ----------
Dividends from net investment income......... (0.28) (0.43) (0.48) (0.66) (0.64)
Distributions in excess of net investment
income..................................... (0.06) (0.04) (0.05) -- --
Distributions from paid-in capital........... (0.14) (0.07) (0.08) -- --
------- ------- -------- ---------- ----------
Total dividends and distributions to
shareholders............................... (0.48) (0.54) (0.61) (0.66) (0.64)
------- ------- -------- ---------- ----------
Net asset value, end of year................. $ 9.72 $ 10.54 $ 10.24 $ 10.44 $ 10.31
======= ======= ======== ========== ==========
Total investment return(1)................... (3.29)% 8.53% 4.11% 7.95% 10.24%
======= ======= ======== ========== ==========
Ratio/Supplemental data:
Net assets, end of year (000's).............. $12,187 $33,478 $103,312 $ 307,577 $ 484,534
Expenses to average net assets, net of
waivers from adviser(3).................... 2.11% 2.13% 1.99% 1.99% 2.00%(2)
Net investment income to average net assets,
net of waivers from adviser(3)............. 4.64% 5.16% 5.83% 6.14% 6.71%(2)
Portfolio turnover rate...................... 63% 93% 172% 126% 113%
</TABLE>
- ------------
@ Calculated using the average monthly shares outstanding.
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each year reported, reinvestment of all dividends and other
distributions at net asset value on the payable dates and a sale at net
asset value on the last day of each year reported. The figures do not
include any applicable sales charges or program fees; results would be
lower if they were included.
(2) These ratios include non-recurring acquisition expenses of 0.04%.
(3) During the year ended October 31, 1999, Mitchell Hutchins waived a portion
of its advisory and administration fees. The ratios excluding the waiver
would be the same since the fee waiver represents less than 0.005%.
- --------------------------------------------------------------------------------
Prospectus Page 26
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Income Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL INCOME FUND
-------------------------------------------------------
CLASS C
-------------------------------------------------------
FOR THE YEARS ENDED OCTOBER 31,
-------------------------------------------------------
1999 1998 1997 1996 1995
------- ------- ------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $ 10.58 $ 10.26 $ 10.45 $ 10.33 $ 9.98
------- ------- ------- ---------- ----------
Net investment income@....................... 0.52 0.56 0.63 0.67 0.71
Net realized and unrealized gains (losses)
from investments and foreign currency@..... (0.82) 0.33 (0.18) 0.14 0.31
------- ------- ------- ---------- ----------
Net increase (decrease) from investment
transactions............................... (0.30) 0.89 0.45 0.81 1.02
------- ------- ------- ---------- ----------
Dividends from net investment income......... (0.30) (0.46) (0.50) (0.69) (0.67)
Distributions in excess of net investment
income..................................... (0.06) (0.04) (0.06) -- --
Distributions from paid-in capital........... (0.16) (0.07) (0.08) -- --
------- ------- ------- ---------- ----------
Total dividends and distributions to
shareholders............................... (0.52) (0.57) (0.64) (0.69) (0.67)
------- ------- ------- ---------- ----------
Net asset value, end of year................. $ 9.76 $ 10.58 $ 10.26 $ 10.45 $ 10.33
======= ======= ======= ========== ==========
Total investment return(1)................... (2.93)% 9.01% 4.48% 8.12% 10.49%
======= ======= ======= ========== ==========
Ratio/Supplemental data:
Net assets, end of year (000's).............. $21,682 $28,633 $36,935 $ 50,928 $ 71,329
Expenses to average net assets, net of
waivers from adviser(3).................... 1.69% 1.77% 1.69% 1.73% 1.75%(2)
Net investment income to average net assets,
net of waivers from adviser(3)............. 5.08% 5.54% 6.17% 6.40% 6.96%(2)
Portfolio turnover rate...................... 63% 93% 172% 126% 113%
<CAPTION>
GLOBAL INCOME FUND
-------------------------------------------------------------------
CLASS Y
-------------------------------------------------------------------
FOR THE YEARS ENDED OCTOBER 31,
-------------------------------------------------------------------
1999 1998 1997 1996 1995
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $ 10.58 $ 10.27 $ 10.49 $ 10.35 $ 9.99
---------- ---------- ---------- ---------- ----------
Net investment income@....................... 0.60 0.65 0.71 0.75 0.78
Net realized and unrealized gains (losses)
from investments and foreign currency@..... (0.82) 0.32 (0.21) 0.17 0.32
---------- ---------- ---------- ---------- ----------
Net increase (decrease) from investment
transactions............................... (0.22) 0.97 0.50 0.92 1.10
---------- ---------- ---------- ---------- ----------
Dividends from net investment income......... (0.35) (0.52) (0.56) (0.78) (0.74)
Distributions in excess of net investment
income..................................... (0.07) (0.05) (0.06) -- --
Distributions from paid-in capital........... (0.18) (0.09) (0.10) -- --
---------- ---------- ---------- ---------- ----------
Total dividends and distributions to
shareholders............................... (0.60) (0.66) (0.72) (0.78) (0.74)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year................. $ 9.76 $ 10.58 $ 10.27 $ 10.49 $ 10.35
========== ========== ========== ========== ==========
Total investment return(1)................... (2.10)% 9.89% 5.20% 9.25% 11.39%
========== ========== ========== ========== ==========
Ratio/Supplemental data:
Net assets, end of year (000's).............. $ 9,735 $ 9,547 $ 10,096 $ 13,077 $ 16,613
Expenses to average net assets, net of
waivers from adviser(3).................... 0.85% 0.96% 0.94% 0.96% 0.95%(2)
Net investment income to average net assets,
net of waivers from adviser(3)............. 5.86% 6.35% 6.93% 7.19% 7.77%(2)
Portfolio turnover rate...................... 63% 93% 172% 126% 113%
</TABLE>
- ------------
- --------------------------------------------------------------------------------
Prospectus Page 27
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Asia Pacific Growth Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASIA PACIFIC GROWTH FUND
------------------------------------
CLASS A
------------------------------------
FOR THE YEARS ENDED FOR THE PERIOD
OCTOBER 31, ENDED
-------------------- OCTOBER 31,
1999 1998 1997+
--------- --------- --------------
<S> <C> <C> <C>
Net asset value, beginning of period......... $ 6.82 $ 8.96 $ 12.50
------- ------- -------
Net investment income (loss)................. (0.05)@ 0.00@ 0.03
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.94@ (2.14)@ (3.57)
------- ------- -------
Net increase (decrease) from investment
operations................................. 2.89 (2.14) (3.54)
------- ------- -------
Net asset value, end of period............... $ 9.71 $ 6.82 $ 8.96
======= ======= =======
Total investment return(1)................... 42.38% (23.88)% (28.32)%
======= ======= =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $14,229 $11,526 $21,466
Expenses to average net assets, net of
waivers from adviser(2).................... 2.73% 2.88% 2.33%*
Net investment income (loss) to average net
assets, net of waivers from adviser(2)..... (0.53)% (0.02)% 0.37%*
Portfolio turnover rate...................... 70% 59% 13%
</TABLE>
- -----------
* Annualized
+ For the period March 25, 1997 (commencement of operations) to October 31,
1997.
++ For the period March 13, 1998 (commencement of offering) through October
31, 1998.
@ Calculated using the average monthly shares outstanding for the period.
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends and other
distributions if any, at net asset value on the payable dates, and a sale
at net asset value on the last day of each period reported. The figures do
not include any applicable sales charges or program fees; results would be
lower if they were included. Total investment returns for periods less than
a year have not been annualized.
(2) During the year ended October 31, 1999 Mitchell Hutchins waived a portion
of its advisory and administration fees. The ratios excluding the waiver
would be the same since the fee waiver represents less than 0.005%.
- --------------------------------------------------------------------------------
Prospectus Page 28
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Asia Pacific Growth Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASIA PACIFIC GROWTH FUND
----------------------------------------
CLASS B
----------------------------------------
FOR THE YEARS ENDED FOR THE PERIOD
OCTOBER 31, ENDED
----------------------- OCTOBER 31,
1999 1998 1997+
---------- ---------- --------------
<S> <C> <C> <C>
Net asset value, beginning of period......... $ 6.74 $ 8.92 $ 12.50
------- ------- -------
Net investment income (loss)................. (0.11)@ (0.06)@ (0.03)
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.89@ (2.12)@ (3.55)
------- ------- -------
Net increase (decrease) from investment
operations................................. 2.78 (2.18) (3.58)
------- ------- -------
Net asset value, end of period............... $ 9.52 $ 6.74 $ 8.92
======= ======= =======
Total investment return(1)................... 41.25% (24.44)% (28.64)%
======= ======= =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $14,589 $12,746 $22,949
Expenses to average net assets, net of
waivers from adviser(2).................... 3.52% 3.63% 3.12%*
Net investment income (loss) to average net
assets, net of waivers from adviser(2)..... (1.34)% (0.78)% (0.43)%*
Portfolio turnover rate...................... 70% 59% 13%
<CAPTION>
ASIA PACIFIC GROWTH FUND
---------------------------------------------------------------------
CLASS C CLASS Y
------------------------------------- -----------------------------
FOR THE YEARS ENDED FOR THE PERIOD FOR THE YEAR FOR THE PERIOD
OCTOBER 31, ENDED ENDED ENDED
-------------------- OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1997+ 1999 1998++
---------- ------- -------------- ------------ --------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.74 $ 8.92 $ 12.50 $ 6.79 $ 8.66
------- ------- ------- ------ -------
Net investment income (loss)................. (0.10)@ (0.06)@ (0.03) 0.00@ 0.06@
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.89@ (2.12)@ (3.55) 2.89@ (1.93)@
------- ------- ------- ------ -------
Net increase (decrease) from investment
operations................................. 2.79 (2.18) (3.58) 2.89 (1.87)
------- ------- ------- ------ -------
Net asset value, end of period............... $ 9.53 $ 6.74 $ 8.92 $ 9.68 $ 6.79
======= ======= ======= ====== =======
Total investment return(1)................... 41.39% (24.44)% (28.64)% 42.56% (21.59)%
======= ======= ======= ====== =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $10,052 $ 6,220 $13,887 $ 192 $ 47
Expenses to average net assets, net of
waivers from adviser(2).................... 3.45%* 3.60% 3.10%* 2.34% 2.66%*
Net investment income (loss) to average net
assets, net of waivers from adviser(2)..... (1.23)%* (0.79)% (0.42)%* (0.06)% (1.46)%*
Portfolio turnover rate...................... 70% 59% 13% 70% 59%
</TABLE>
- -----------
- --------------------------------------------------------------------------------
Prospectus Page 29
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Emerging Markets Equity Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EMERGING MARKETS EQUITY FUND
--------------------------------------------------------------
CLASS A
--------------------------------------------------------------
FOR THE FOR THE YEARS
FOR THE YEARS ENDED FOUR MONTHS ENDED
OCTOBER 31, ENDED JUNE 30,
--------------------------- OCTOBER 31, ------------------
1999 1998 1997*** 1996 1996 1995**
------ -------- ------- ----------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.52 $ 9.39 $ 9.46 $ 10.06 $ 9.73 $ 10.79
------ -------- ------ ------- ------- -------
Net investment income (loss)................. (0.02)@ (0.01)@ (0.06) (0.13) (0.14) (0.04)
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.29@ (2.86)@ (0.01) (0.47) 0.47 (0.97)
------ -------- ------ ------- ------- -------
Net increase (decrease) from investment
operations................................. 2.27 (2.87) (0.07) (0.60) 0.33 (1.01)
------ -------- ------ ------- ------- -------
Dividends from net investment income......... -- -- -- -- -- (0.05)
------ -------- ------ ------- ------- -------
Net asset value, end of period............... $ 8.79 $ 6.52 $ 9.39 $ 9.46 $ 10.06 $ 9.73
====== ======== ====== ======= ======= =======
Total investment return (1).................. 34.82% (30.56)% (0.74)% (5.96)% 3.39% (9.29)%
====== ======== ====== ======= ======= =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $5,090 $ 4,237 $9,222 $14,992 $20,680 $33,043
Expenses, net of fee waivers, to average net
assets..................................... 2.44% 2.44% 2.44% 2.44%* 2.44% 2.44%
Expenses, before fee waivers, to average net
assets..................................... 3.56% 3.71% 3.01% 3.48%* 3.42% 2.54%
Net investment loss, net of fee waivers, to
average net assets......................... (0.31)% (0.16)% (0.40)% (1.42)%* (0.52)% (0.76)%
Net investment loss, before fee waivers, to
average net assets......................... (1.43)% (1.43)% (0.97)% (2.46)%* (1.50)% (0.86)%
Portfolio turnover rate...................... 80% 64% 87% 22% 69% 76%
<CAPTION>
EMERGING MARKETS EQUITY FUND
------------------------------------------------------------
CLASS B
------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED FOUR MONTHS FOR THE
OCTOBER 31, ENDED PERIOD ENDED
------------------------------- OCTOBER 31, JUNE 30,
1999 1998 1997*** 1996 1996++
------- ------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.37 $ 9.19 $ 9.32 $ 9.94 $ 9.13
------- ------- ---------- ---------- ------
Net investment income (loss)................. (0.08)@ (0.08)@ (0.10) (0.07) (0.01)
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.23@ (2.74)@ (0.03) (0.55) 0.82
------- ------- ---------- ---------- ------
Net increase (decrease) from investment
operations................................. 2.15 (2.82) (0.13) (0.62) 0.81
------- ------- ---------- ---------- ------
Dividends from net investment income......... -- -- -- -- --
------- ------- ---------- ---------- ------
Net asset value, end of period............... $ 8.52 $ 6.37 $ 9.19 $ 9.32 $ 9.94
======= ======= ========== ========== ======
Total investment return (1).................. 33.75% (30.69)% (1.39)% (6.24)% 8.87%
======= ======= ========== ========== ======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $ 459 $ 461 $ 1,598 $ 879 $ 936
Expenses, net of fee waivers, to average net
assets..................................... 3.19% 3.19% 3.19% 3.19%* 3.19%*
Expenses, before fee waivers, to average net
assets..................................... 4.50% 4.92% 3.82% 4.23%* 4.97%*
Net investment loss, net of fee waivers, to
average net assets......................... (1.06)% (0.99)% (1.25)% (2.12)%* (0.21)%*
Net investment loss, before fee waivers, to
average net assets......................... (2.37)% (2.72)% (1.88)% (3.16)%* (1.99)%*
Portfolio turnover rate...................... 80% 64% 87% 22% 69%
</TABLE>
- ---------------
++ For the period December 5, 1995 (commencement of offering of shares) to
June 30, 1996.
@ Calculated using the average shares outstanding for the year.
* Annualized.
** Investment advisory functions for the Fund were transferred from Kidder
Peabody Asset Management Inc. to Mitchell Hutchins on February 13, 1995.
*** Investment sub-advisory functions for the Fund were transferred from
Emerging Markets Management to Schroder Investment Management North America
Inc. on February 25, 1997.
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends at net
asset value on the payable dates and a sale at net asset value on the last
day of each period reported. The figures do not include any applicable
sales charges or program fees; results would be lower if they were
included. Total investment returns for periods of less than one year have
not been annualized.
- --------------------------------------------------------------------------------
Prospectus Page 30
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Emerging Markets Equity Fund
FINANCIAL HIGHLIGHTS
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EMERGING MARKETS EQUITY FUND
-------------------------------------------------------------------------
CLASS C
-------------------------------------------------------------------------
FOR THE FOR THE YEARS
FOR THE YEARS ENDED FOUR MONTHS ENDED
OCTOBER 31, ENDED JUNE 30,
------------------------------- OCTOBER 31, -------------------------
1999 1998 1997*** 1996 1996 1995**
------- ------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.32 $ 9.17 $ 9.32 $ 9.94 $ 9.67 $ 10.75
------ ------ ---------- ---------- ---------- ----------
Net investment income (loss)................. (0.08)@ (0.08)@ (0.14) (0.22) (0.24) (0.17)
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.19@ (2.77)@ (0.01) (0.40) 0.51 (0.90)
------ ------ ---------- ---------- ---------- ----------
Net increase (decrease) from investment
operations................................. 2.11 (2.85) (0.15) (0.62) 0.27 (1.07)
------ ------ ---------- ---------- ---------- ----------
Dividends from net investment income......... -- -- -- -- -- (0.01)
------ ------ ---------- ---------- ---------- ----------
Net asset value, end of period............... $ 8.43 $ 6.32 $ 9.17 $ 9.32 $ 9.94 $ 9.67
====== ====== ========== ========== ========== ==========
Total investment return (1).................. 33.39% (31.08)% (1.61)% (6.24)% 2.79% (10.01)%
====== ====== ========== ========== ========== ==========
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $2,126 $2,575 $ 5,345 $ 7,882 $ 11,561 $ 18,551
Expenses, net of fee waivers, to average net
assets..................................... 3.19% 3.19% 3.19% 3.19%* 3.19% 3.19%
Expenses, before fee waivers, to average net
assets..................................... 4.43% 4.42% 3.78% 4.23%* 4.17% 3.29%
Net investment loss, net of fee waivers, to
average net assets......................... (1.06)% (0.96)% (1.18)% (2.16)%* (1.28)% (1.50)%
Net investment loss, before fee waivers, to
average net assets......................... (2.30)% (2.19)% (1.77)% (3.20)%* (2.26)% (1.60)%
Portfolio turnover rate...................... 80% 64% 87% 22% 69% 76%
<CAPTION>
EMERGING MARKETS EQUITY FUND
-----------------------------------------------------------------
CLASS Y
-----------------------------------------------------------------
FOR THE FOR THE YEARS
FOR THE YEARS ENDED FOUR MONTHS ENDED
OCTOBER 31, ENDED JUNE 30,
----------------------------- OCTOBER 31, -------------------
1999 1998 1997*** 1996 1996 1995**
------- -------- -------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 6.58 $ 9.46 $ 9.51 $ 10.11 $ 9.75 $ 10.80
------ ------- ------- ------- ------- -------
Net investment income (loss)................. 0.00@ (0.01)@ (0.02) (0.05) (0.01) 0.01
Net realized and unrealized gains (losses)
from investments and foreign currency...... 2.31@ (2.87)@ (0.03) (0.55) 0.37 (0.99)
------ ------- ------- ------- ------- -------
Net increase (decrease) from investment
operations................................. 8.89 (2.88) (0.05) (0.60) 0.36 (0.98)
------ ------- ------- ------- ------- -------
Dividends from net investment income......... -- -- -- -- -- (0.07)
------ ------- ------- ------- ------- -------
Net asset value, end of period............... $ 8.89 $ 6.58 $ 9.46 $ 9.51 $ 10.11 $ 9.75
====== ======= ======= ======= ======= =======
Total investment return (1).................. 35.11% (30.44)% (0.53)% (5.93)% 3.69% (9.03)%
====== ======= ======= ======= ======= =======
Ratios/Supplemental Data:
Net assets, end of period (000's)............ $ 804 $ 877 $10,053 $11,375 $12,979 $12,332
Expenses, net of fee waivers, to average net
assets..................................... 2.19% 2.19% 2.19% 2.19%* 2.19% 2.19%
Expenses, before fee waivers, to average net
assets..................................... 3.46% 3.36% 2.69% 3.23%* 3.29% 2.29%
Net investment loss, net of fee waivers, to
average net assets......................... (0.03)% (0.08)% (0.15)% (1.13)%* (0.15)% (0.51)%
Net investment loss, before fee waivers, to
average net assets......................... (1.31)% (1.25)% (0.65)% (2.17)%* (1.25)% (0.61)%
Portfolio turnover rate...................... 80% 64% 87% 22% 69% 76%
</TABLE>
- ---------------
- --------------------------------------------------------------------------------
Prospectus Page 31
<PAGE>
- --------------------------------------------------------------------------------
------------------------
PaineWebber Global Equity Fund PaineWebber Asia Pacific Growth Fund
PaineWebber Global Income Fund PaineWebber Emerging Markets Equity Fund
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
TICKER SYMBOL: Global Equity Fund Class A: KPGEX.Q Asia Pacific Growth Fund Class A: PPGAX.Q
B: KPGLX.Q B: PPGBX.Q
C: KPGBX.Q C: PPGCX.Q
Y: KPGCX.Q Y: None
Global Income Fund Class A: PGBAX.Q Emerging Markets Equity Fund Class A: KPEAX.Q
B: PGBBX.Q B: None
C: PWIDX.Q C: KPEBX.Q
Y: None Y: None
</TABLE>
For investors who want more information about the funds, the following documents
are available free upon request:
ANNUAL/SEMI-ANNUAL REPORTS
Additional information about the funds' investments is available in the funds'
annual and semi-annual reports to shareholders. In the funds' annual reports,
you will find a discussion of the market conditions and investment strategies
that significantly affected the funds' performance during the last fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
The SAI provides more detailed information about the funds and is incorporated
by reference into this prospectus.
You may discuss your questions about the funds by contacting your PaineWebber
Financial Advisor. You may obtain free copies of annual and semi-annual reports
and the SAI by contacting the funds directly at 1-800-647-1568.
You may review and copy information about the funds, including shareholder
reports and the SAI, at the Public Reference Room of the Securities and Exchange
Commission. You may obtain information about the operations of the SEC's Public
Reference Room by calling the SEC at 1-202-942-8090. You can get text-only
copies of reports and other information about the funds:
- - For a fee, by electronic request or by writing the SEC's Public Reference
Room, Washington, D.C. 20549-0102; or
- - Free from the EDGAR Database on the SEC's Internet website at:
http://www.sec.gov
PaineWebber Investment Trust
- --PaineWebber Global Equity Fund
Investment Company Act File No. 811-6292
PaineWebber Investment Series
- --PaineWebber Global Income Fund
Investment Company Act File No. 811-5259
PaineWebber Managed Investments Trust
- --PaineWebber Asia Pacific Growth Fund
Investment Company Act File No. 811-4040
PaineWebber Investment Trust II
- --PaineWebber Emerging Markets Equity Fund
Investment Company Act File No. 811-7104
- -C- 2000 PaineWebber Incorporated. All rights reserved.
- --------------------------------------------------------------------------------
_______________
