T. Rowe Price
Supplement to Statement of Additional Information
for the Domestic Equity Funds dated May 1, 1997, as revised
The following paragraph will be added under Portfolio Management
Practices:
Money Market Reserves
It is expected that the Funds will invest their cash
reserves primarily
in one or more money market funds established for the exclusive
use of the T.
Rowe Price family of mutual funds and other clients of T. Rowe
Price and
Price-Fleming. Currently, two such money market funds are in
operation--
Reserve Investment Fund ("RIF") and Government Reserve Investment
Fund
("GRF"), each a series of the Reserve Investment Funds, Inc.
Additional series
may be created in the future. These funds were created and
operate under an
Exemptive Order issued by the Securities and Exchange Commission
(Investment
Company Act Release No. IC-22770, July 29, 1997).
Both funds must comply with the requirements of Rule 2a-7
under the
Investment Company Act of 1940 governing money market funds. The
RIF invests
at least 95% of its total assets in prime money market
instruments receiving
the highest credit rating. The GRF invests primarily in a
portfolio of U.S.
government-backed securities, primarily U.S. Treasuries, and
repurchase
agreements thereon.
The RIF and GRF provide a very efficient means of managing
the cash
reserves of the Funds. While neither RIF or GRF pay an advisory
fee to the
Investment Manager, they will incur other expenses. However, the
RIF and GRF
are expected by T. Rowe Price to operate at very low expense
ratios. The Funds
will only invest in RIF or GRF to the extent it is consistent
with each Fund's
objective and program.
Neither fund is insured or guaranteed by the U.S.
government, and there
is no assurance they will maintain a stable net asset value of
$1.00 per
share.
The date of this supplement is October 3, 1997.
C20-045 10/3/97
