<PAGE>
Filed Pursuant to Rule 497(c)
Registration File No.: 2-94996
PROSPECTUS SUPPLEMENT DATED MAY 1, 1998 TO:
THE HUDSON RIVER TRUST
PROSPECTUS DATED MAY 1, 1997
1. The date of the Prospectus is May 1, 1998. A Statement of Additional
Information relating to Class IA shares ("SAI") dated May 1, 1998 has been
filed with the Securities and Exchange Commission ("SEC"). This SAI is
incorporated by reference into this prospectus and is available at no charge
by writing the Trust at the above address. California residents may obtain
the SAI at no charge by calling 1-800-999-3527.
2. The section entitled "Financial Highlights" is replaced with the
following:
FINANCIAL HIGHLIGHTS
The financial information in the tables below for the fiscal years ended on
or after December 31, 1993 has been audited by Price Waterhouse LLP, the
Trust's independent accountants. Financial highlights for prior years have
been audited by another independent accounting firm. The December 31, 1997
audited financial statements of the Trust and the "Report of Independent
Accountants" appear in the SAI. The Trust's annual report, which contains
additional performance information, is available without charge upon request.
FINANCIAL HIGHLIGHTS
PER SHARE INCOME AND CAPITAL CHANGES
(FOR A CLASS IA SHARE OUTSTANDING THROUGHOUT EACH PERIOD)(c)
ASSET ALLOCATION SERIES
ALLIANCE CONSERVATIVE INVESTORS PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1997 1996 1995 1994 1993*
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) ..... $ 11.29 $ 11.52 $10.15 $11.12 $10.94
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ....................... 0.49 0.50 0.60 0.55 0.52
Net realized and unrealized gain (loss) on
investments and foreign currency
transactions............................... 0.97 0.07 1.43 (1.00) 0.65
---------- ---------- ---------- ---------- ----------
Total from investment operations ............ 1.46 0.57 2.03 (0.45) 1.17
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income ........ (0.49) (0.51) (0.59) (0.52) (0.50)
Dividends in excess of net investment
income..................................... -- -- -- -- (0.00)
Distributions from realized gains .......... (0.37) (0.27) (0.07) -- (0.49)
Distributions in excess of realized gains ... -- (0.02) -- -- --
---------- ---------- ---------- ---------- ----------
Total dividends and distributions .......... (0.86) (0.80) (0.66) (0.52) (0.99)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period................ $ 11.89 $ 11.29 $11.52 $10.15 $11.12
========== ========== ========== ========== ==========
Total return (d).............................. 13.25% 5.21% 20.40% (4.10)% 10.76%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)............. $307,847 $282,402 $252,101 $173,691 $114,418
Ratio of expenses to average net assets ..... 0.57% 0.61% 0.59% 0.59% 0.60%
Ratio of net investment income to average net
assets ...................................... 4.17% 4.48% 5.48% 5.22% 4.49%
Portfolio turnover rate....................... 206% 181% 287% 228% 178%
Average commission rate paid (f).............. $0.0413 $0.0488 -- -- --
</TABLE>
<PAGE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
OCTOBER 2,
YEAR ENDED DECEMBER 31, 1989 TO
------------------------------ DECEMBER 31,
1992 1991 1990 1989
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net asset value, beginning of period (a) ..... $ 11.29 $ 10.23 $ 10.26 $ 10.00
--------- --------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ....................... 0.64 0.69 0.72 0.15
Net realized and unrealized gain (loss) on
investments and foreign currency
transactions............................... (0.01) 1.28 (0.09) 0.16
--------- --------- --------- ---------
Total from investment operations ............ 0.63 1.97 0.63 0.31
--------- --------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income ........ (0.62) (0.66) (0.66) (0.05)
Dividends in excess of net investment
income..................................... -- -- -- --
Distributions from realized gains .......... (0.36) (0.25) -- --
Distributions in excess of realized gains ... -- -- -- --
--------- --------- --------- ---------
Total dividends and distributions .......... (0.98) (0.91) (0.66) (0.05)
--------- --------- --------- ---------
Net asset value, end of period................ $ 10.94 $ 11.29 $ 10.23 $ 10.26
========= ========= ========= =========
Total return (d).............................. 5.64% 19.80% 6.30% 3.10%
========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)............. $70,675 $50,279 $29,971 $13,984
Ratio of expenses to average net assets ..... 0.61% 0.64% 0.73% 0.26%
Ratio of net investment income to average net
assets ...................................... 5.77% 6.45% 7.06% 1.54%
Portfolio turnover rate....................... 136% 171% 88% 0%
Average commission rate paid (f).............. -- -- -- --
</TABLE>
- ------------
Footnotes appear on page 9.
- -----------------------------------------------------------------------------
HRT103 (5/98) Supp.1 Copyright 1998 The Hudson River Trust. All rights
reserved.
<PAGE>
ALLIANCE BALANCED PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1997 1996 1995 1994 1993*
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a)....................... $ 16.64 $ 16.76 $14.87 $16.67 $16.19
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income.......... 0.58 0.53 0.54 0.45 0.50
Net realized and unrealized
gain (loss) on investments
and foreign currency
transactions.................. 1.86 1.31 2.36 (1.78) 1.46
---------- ---------- ---------- ---------- ----------
Total from investment
operations.................... 2.44 1.84 2.90 (1.33) 1.96
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment
income......................... (0.59) (0.53) (0.54) (0.44) (0.50)
Dividends in excess of net
investment income............. -- -- -- (0.03) --
Distributions from realized
gains......................... (0.91) (1.40) (0.47) -- (0.95)
Distributions in excess of
realized gains................ -- (0.03) -- -- (0.03)
Tax return of capital
distributions................. -- -- -- (0.00) --
---------- ---------- ---------- ---------- ----------
Total dividends and
distributions................. (1.50) (1.96) (1.01) (0.47) (1.48)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year ... $ 17.58 $ 16.64 $16.76 $14.87 $16.67
========== ========== ========== ========== ==========
Total return (d)................ 15.06% 11.68% 19.75% (8.02)% 12.28%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year
(000's)........................ $1,724,089 $1,637,856 $1,523,142 $1,329,820 $1,364,640
Ratio of expenses to average
net assets..................... 0.45% 0.41% 0.40% 0.39% 0.39%
Ratio of net investment income
to average net assets.......... 3.30% 3.15% 3.33% 2.87% 2.99%
Portfolio turnover rate (h) .... 146% 177% 186% 115% 99%
Average commission rate
paid (f)....................... $0.0409 $0.0516 -- -- --
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------
1992 1991 1990 1989 1988
---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a)....................... $18.48 $14.40 $15.16 $13.38 $12.39
---------- -------- -------- -------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income.......... 0.56 0.60 0.78 0.85 0.67
Net realized and unrealized
gain (loss) on investments
and foreign currency
transactions.................. (1.11) 5.23 (0.76) 2.53 0.95
---------- -------- -------- -------- --------
Total from investment
operations.................... (0.55) 5.83 0.02 3.38 1.62
---------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income......................... (0.55) (0.55) (0.78) (0.85) (0.63)
Dividends in excess of net
investment income............. -- -- -- -- --
Distributions from realized
gains......................... (1.19) (1.20) -- (0.75) --
Distributions in excess of
realized gains................ -- -- -- -- --
Tax return of capital
distributions................. -- -- -- -- --
---------- -------- -------- -------- --------
Total dividends and
distributions................. (1.74) (1.75) (0.78) (1.60) (0.63)
---------- -------- -------- -------- --------
Net asset value, end of year ... $16.19 $18.48 $14.40 $15.16 $13.38
========== ======== ======== ======== ========
Total return (d)................ (2.85)% 41.25% 0.25% 25.84% 13.27%
========== ======== ======== ======== ========
<PAGE>
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year
(000's)........................ $1,076,670 $964,262 $286,432 $241,910 $161,819
Ratio of expenses to average
net assets..................... 0.40% 0.41% 0.45% 0.45% 0.51%
Ratio of net investment income
to average net assets.......... 3.30% 3.60% 5.35% 5.71% 5.15%
Portfolio turnover rate (h) .... 91% 159% 119% 132% 204%
Average commission rate
paid (f)....................... -- -- -- -- --
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
The Hudson River Trust 2
<PAGE>
ALLIANCE GROWTH INVESTORS PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
1997 1996 1995 1994 1993*
----------- ----------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) . $ 17.20 $ 17.68 $14.66 $15.61 $14.69
------------ ------------ ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................. 0.41 0.40 0.57 0.50 0.43
Net realized and unrealized gain (loss)
on investments and foreign currency
transactions .......................... 2.43 1.66 3.24 (0.98) 1.79
------------ ------------ ---------- ---------- ----------
Total from investment operations ........ 2.84 2.06 3.81 (0.48) 2.22
------------ ------------ ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income .... (0.46) (0.40) (0.54) (0.46) (0.42)
Dividends in excess of net investment
income................................. -- (0.03) (0.01) (0.01) --
Distributions from realized gains ...... (1.03) (2.10) (0.24) -- (0.88)
Distributions in excess of realized
gains.................................. -- (0.01) -- -- --
------------ ------------ ---------- ---------- ----------
Total dividends and distributions ...... (1.49) (2.54) (0.79) (0.47) (1.30)
------------ ------------ ---------- ---------- ----------
Net asset value, end of period............ $ 18.55 $ 17.20 $17.68 $14.66 $15.61
============ ============ ========== ========== ==========
Total return (d) ......................... 16.87% 12.61% 26.37% (3.15)% 15.26%
============ ============ ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net asset, end of period (000's).......... $1,630,389 $1,301,643 $896,134 $492,478 $278,467
Ratio of expenses to average net assets . 0.57% 0.57% 0.56% 0.59% 0.62%
Ratio of net investment income to average
net assets .............................. 2.18% 2.31% 3.43% 3.32% 2.71%
Portfolio turnover rate................... 121% 190% 107% 131% 118%
Average commission rate paid (f).......... $0.0460 $0.0495 -- -- --
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
OCTOBER 2,
YEAR ENDED DECEMBER 31, 1989 TO
------------------------------- DECEMBER 31,
1992 1991 1990 1989
---------- --------- --------- ----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period (a) . $ 15.17 $ 11.03 $ 10.33 $10.00
---------- --------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................. 0.44 0.41 0.44 0.11
Net realized and unrealized gain (loss)
on investments and foreign currency
transactions .......................... 0.28 4.93 0.64 0.29
---------- --------- --------- ---------
Total from investment operations ........ 0.72 5.34 1.08 0.40
---------- --------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income .... (0.41) (0.37) (0.38) (0.06)
Dividends in excess of net investment
income................................. -- -- -- --
Distributions from realized gains ...... (0.79) (0.83) -- (0.01)
Distributions in excess of realized
gains.................................. -- -- -- --
---------- --------- --------- ---------
Total dividends and distributions ...... (1.20) (1.20) (0.38) (0.07)
---------- --------- --------- ---------
Net asset value, end of period............ $ 14.69 $ 15.17 $ 11.03 $10.33
========== ========= ========= =========
Total return (d) ......................... 4.85% 48.83% 10.70% 4.00%
========== ========= ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net asset, end of period (000's).......... $148,650 $84,338 $24,539 $6,018
Ratio of expenses to average net assets . 0.60% 0.66% 0.78% 0.29%
Ratio of net investment income to average
net assets .............................. 3.00% 3.03% 4.11% 1.01%
Portfolio turnover rate................... 129% 139% 92% 6%
Average commission rate paid (f).......... -- -- -- --
</TABLE>
<PAGE>
EQUITY SERIES
ALLIANCE GROWTH AND INCOME PORTFOLIO:
<TABLE>
<CAPTION>
OCTOBER 1, 1993
YEAR ENDED TO
DECEMBER 31, DECEMBER 31, 1993
------------------------------------------- ---------------------
1997 1996 1995 1994
--------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a)............... $ 13.01 $ 11.70 $ 9.70 $ 9.95 $10.00
---------- ---------- --------- --------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................................. 0.15 0.24 0.33 0.31 0.03
Net realized and unrealized gain (loss) on
investments........................................... 3.30 2.05 1.97 (0.36) (0.06)
---------- ---------- --------- --------- ----------
Total from investment operations...................... 3.45 2.29 2.30 (0.05) (0.03)
---------- ---------- --------- --------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income.................. (0.15) (0.23) (0.30) (0.20) (0.02)
Dividends in excess of net investment income ......... -- -- -- -- (0.00)
Distributions from realized gains .................... (0.93) (0.75) -- -- --
Tax return of capital distributions................... -- -- -- -- (0.00)
---------- ---------- --------- --------- ----------
Total dividends and distributions..................... (1.08) (0.98) (0.30) (0.20) (0.02)
---------- ---------- --------- --------- ----------
Net asset value, end of period......................... $ 15.38 $ 13.01 $11.70 $ 9.70 $ 9.95
========== ========== ========= ========= ==========
Total return (d)....................................... 26.90% 20.09% 24.07% (0.58)% (0.25)%
========== ========== ========= ========= ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)...................... $555,059 $232,080 $98,053 $31,522 $1,456
Ratio of expenses to average net assets................ 0.58% 0.58% 0.60% 0.78% 2.70%(b)
Ratio of net investment income to average net assets .. 0.99% 1.94% 3.11% 3.13% 1.12%(b)
Portfolio turnover rate................................ 79% 88% 65% 52% 48%
Average commission rate paid (f)....................... $0.0586 $0.0604 -- -- --
</TABLE>
- ------------
Footnotes appear on page 9.
- --------------------------------------------------------------------------------
3 The Hudson River Trust
<PAGE>
ALLIANCE EQUITY INDEX PORTFOLIO:
<TABLE>
<CAPTION>
MARCH 1, 1994
YEAR ENDED TO
DECEMBER 31, DECEMBER 31, 1994
--------------------------------- -----------------
1997 1996 1995
--------- --------- ---------
<S> <C> <C> <C> <C>
Net asset value, beginning of period (a)................................... $ 15.16 $ 13.13 $ 9.87 $10.00
---------- ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................................................... 0.26 0.27 0.26 0.20
Net realized and unrealized gain (loss) on investments and foreign
currency transactions ................................................... 4.64 2.65 3.32 (0.09)
---------- ---------- ---------- ----------
Total from investment operations ......................................... 4.90 2.92 3.58 0.11
---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income ..................................... (0.25) (0.25) (0.22) (0.20)
Distributions of realized gains........................................... (0.07) (0.64) (0.09) (0.03)
Distributions in excess of realized gains................................. -- -- (0.01) (0.01)
---------- ---------- ---------- ----------
Total dividends and distributions......................................... (0.32) (0.89) (0.32) (0.24)
---------- ---------- ---------- ----------
Net asset value, end of period ............................................ $ 19.74 $ 15.16 $13.13 $ 9.87
========== ========== ========== ==========
Total return (d) .......................................................... 32.58% 22.39% 36.48% 1.08%
========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ......................................... $943,631 $386,249 $165,785 $36,748
Ratio of expenses to average net assets.................................... 0.37% 0.39% 0.48% 0.49%(b)
Ratio of net investment income to average net assets....................... 1.46% 1.91% 2.16% 2.42%(b)
Portfolio turnover rate ................................................... 3% 15% 9% 7%
Average commission rate paid (f)........................................... $0.0309 $0.0306 -- --
</TABLE>
ALLIANCE COMMON STOCK PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1997 1996 1995 1994 1993*
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a)......................... $18.23 $16.48 $13.36 $14.65 $13.49
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income............ 0.14 0.15 0.20 0.20 0.23
Net realized and unrealized
gain (loss) on investments and
foreign currency transactions .. 5.12 3.73 4.12 (0.51) 3.10
---------- ---------- ---------- ---------- ----------
Total from investment
operations...................... 5.26 3.88 4.32 (0.31) 3.33
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net
investment income............... (0.11) (0.15) (0.20) (0.19) (0.23)
Dividends in excess of net
investment income............... -- -- (0.02) (0.01) (0.00)
Distributions from
realized gains.................. (1.77) (1.76) (0.95) (0.77) (1.94)
Distributions in excess
of realized gains............... -- (0.22) (0.03) -- --
Tax return of capital
distributions................... -- -- -- (0.01) --
---------- ---------- ---------- ---------- ----------
Total dividends
and distributions............... (1.88) (2.13) (1.20) (0.98) (2.17)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year ..... $21.61 $18.23 $16.48 $13.36 $14.65
========== ========== ========== ========== ==========
Total return (d).................. 29.40% 24.28% 32.45% (2.14)% 24.84%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) .. $9,331,994 $6,625,390 $4,879,677 $3,466,245 $3,125,128
Ratio of expenses to average
net assets...................... 0.39% 0.38% 0.38% 0.38% 0.38%
Ratio of net investment income to
average net assets............... 0.69% 0.85% 1.27% 1.40% 1.55%
Portfolio turnover rate .......... 52% 55% 61% 52% 82%
Average commission rate paid (f) . $0.0579 $0.0565 -- -- --
</TABLE>
<PAGE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------
1992 1991 1990 1989 1988
-------- -------- ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a)......................... $ 14.18 $ 11.22 $ 12.87 $ 12.19 $ 10.15
---------- ---------- -------- -------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income............ 0.24 0.32 0.21 0.27 0.23
Net realized and unrealized
gain (loss) on investments and
foreign currency transactions .. 0.20 3.91 (1.25) 2.84 2.04
---------- ---------- -------- -------- --------
Total from investment
operations...................... 0.44 4.23 (1.04) 3.11 2.27
---------- ---------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net
investment income............... (0.24) (0.29) (0.22) (0.26) (0.23)
Dividends in excess of net
investment income............... -- -- -- -- --
Distributions from
realized gains.................. (0.89) (0.98) (0.39) (2.17) --
Distributions in excess
of realized gains............... -- -- -- -- --
Tax return of capital
distributions................... -- -- -- -- --
---------- ---------- -------- -------- --------
Total dividends
and distributions............... (1.13) (1.27) (0.61) (2.43) (0.23)
---------- ---------- -------- -------- --------
Net asset value, end of year ..... $ 13.49 $ 14.18 $ 11.22 $ 12.87 $ 12.19
========== ========== ======== ======== ========
Total return (d).................. 3.22% 37.90% (8.11)% 25.59% 22.44%
========== ========== ======== ======== ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) .. $2,307,292 $2,126,402 $673,476 $725,627 $537,827
Ratio of expenses to average
net assets...................... 0.38% 0.40% 0.44% 0.43% 0.46%
Ratio of net investment income to
average net assets............... 1.73% 2.32% 1.72% 1.87% 2.02%
Portfolio turnover rate .......... 71% 90% 82% 90% 71%
Average commission rate paid (f) . -- -- -- -- --
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
The Hudson River Trust 4
<PAGE>
ALLIANCE GLOBAL PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------
1997 1996 1995 1994 1993*
---------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period (a)....................... $16.92 $15.74 $13.87 $13.62 $11.41
---------- ------- ------- ------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ........... 0.17 0.21 0.26 0.20 0.08
Net realized and unrealized gain
(loss) on investments and
foreign currency transactions.. 1.75 2.05 2.32 0.52 3.58
---------- ------- ------- ------- --------
Total from investment
operations..................... 1.92 2.26 2.58 0.72 3.66
---------- ------- ------- ------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income......................... (0.36) (0.21) (0.25) (0.17) (0.15)
Dividends in excess of net
investment income.............. -- (0.08) -- -- --
Distributions from realized
gains.......................... (1.19) (0.79) (0.42) (0.28) (1.30)
Distributions in excess of
realized gains................. -- -- (0.03) (0.00) (0.00)
Tax return of capital
distributions ................. -- (0.00) (0.01) (0.02) --
---------- ------- ------- ------- --------
Total dividends and
distributions.................. (1.55) (1.08) (0.71) (0.47) (1.45)
---------- ------- ------- ------- --------
Net asset value, end of period ... $17.29 $16.92 $15.74 $13.87 $13.62
========== ======= ======= ======= ========
Total return (d) ................. 11.66% 14.60% 18.81% 5.23% 32.09%
========== ======= ======= ======= ========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's) .........................$1,203,867 $997,041 $686,140 $421,698 $141,257
Ratio of expenses to average net
assets .......................... 0.69% 0.60% 0.61% 0.69% 0.84%
Ratio of net investment income to
average net assets .............. 0.97% 1.28% 1.76% 1.41% 0.62%
Portfolio turnover rate........... 57% 59% 67% 71% 150%
Average commission rate paid (f) . $0.0412 $0.0418 -- -- --
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1992 1991 1990 1989 1988
------- ------- ------- ------- ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period (a)....................... $ 11.64 $ 9.76 $ 10.74 $ 9.57 $ 8.67
------- ------- ------- ------- ------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ........... 0.14 0.22 0.38 0.17 0.13
Net realized and unrealized gain
(loss) on investments and
foreign currency transactions.. (0.20) 2.74 (1.03) 2.38 0.82
------- ------- ------- ------- ------
Total from investment
operations..................... (0.06) 2.96 (0.65) 2.55 0.95
------- ------- ------- ------- ------
LESS DISTRIBUTIONS:
Dividends from net investment
income......................... (0.11) (0.23) (0.33) (0.14 ) (0.05)
Dividends in excess of net
investment income.............. -- -- -- -- --
Distributions from realized
gains.......................... (0.06) (0.85) -- (1.24 ) --
Distributions in excess of
realized gains................. -- -- -- -- --
Tax return of capital
distributions ................. -- -- -- -- --
------- ------- ------- ------- ------
Total dividends and
distributions.................. (0.17) (1.08) (0.33) (1.38 ) (0.05)
------- ------- ------- ------- ------
Net asset value, end of period ... $ 11.41 $ 11.64 $ 9.76 $ 10.74 $ 9.57
======= ======= ======= ======= ======
Total return (d) ................. (0.50)% 30.54% (6.06)% 26.73 % 10.88%
======= ======= ======= ======= ======
<PAGE>
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's) ......................... $49,171 $39,487 $24,097 $15,409 $9,212
Ratio of expenses to average net
assets .......................... 0.70% 0.75% 0.75% 0.80 % 1.06%
Ratio of net investment income to
average net assets .............. 1.20% 1.94% 3.67% 1.49 % 1.30%
Portfolio turnover rate........... 216% 267% 502% 399 % 235%
Average commission rate paid (f) . -- -- -- -- --
</TABLE>
ALLIANCE INTERNATIONAL PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, APRIL 3, 1995
----------------------- TO
1997 1996 DECEMBER 31, 1995
---------- ---------- -----------------
<S> <C> <C> <C>
Net asset value, beginning of period (a)................................................ $11.50 $10.87 $10.00
---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income.................................................................. 0.10 0.13 0.14
Net realized and unrealized gain (loss) on investments and foreign currency
transactions.......................................................................... (0.45) 0.94 0.98
---------- ---------- ----------
Total from investment operations....................................................... (0.35) 1.07 1.12
---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income................................................... (0.32) (0.10) (0.07)
Dividends in excess of net investment income........................................... -- (0.09) (0.13)
Distributions from realized gains...................................................... (0.56) (0.25) (0.05)
---------- ---------- ----------
Total dividends and distributions...................................................... (0.88) (0.44) (0.25)
---------- ---------- ----------
Net asset value, end of period.......................................................... $10.27 $11.50 $10.87
========== ========== ==========
Total return (d)........................................................................ (2.98)% 9.82% 11.29%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)....................................................... $190,611 $151,907 $28,684
Ratio of expenses to average net assets................................................. 1.08% 1.06% 1.03%(b)
Ratio of net investment income to average net assets.................................... 0.83% 1.10% 1.71%(b)
Portfolio turnover rate................................................................. 59% 48% 56%
Average commission rate paid (f)........................................................ $0.0294 $0.0251 --
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
5 The Hudson River Trust
<PAGE>
ALLIANCE AGGRESSIVE STOCK PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1997 1996 1995 1994 1993*
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a) ....................... $35.85 $35.68 $30.63 $31.89 $29.81
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income .......... 0.04 0.09 0.10 0.04 0.09
Net realized and unrealized
gain (loss) on investments.... 3.71 7.52 9.54 (1.26) 4.91
---------- ---------- ---------- ---------- ----------
Total from investment
operations ................... 3.75 7.61 9.64 (1.22) 5.00
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment
income........................ (0.05) (0.09) (0.10) (0.04) (0.09)
Dividends in excess of net
investment income............. -- (0.00) -- -- --
Distributions from realized
gains......................... (3.33) (7.33) (4.49) -- (2.75)
Distributions in excess of
realized gains................ -- (0.02) -- -- (0.07)
Tax return of capital
distributions................. -- -- -- (0.00) (0.01)
---------- ---------- ---------- ---------- ----------
Total dividends and
distributions................. (3.38) (7.44) (4.59) (0.04) (2.92)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year ... $36.22 $35.85 $35.68 $30.63 $31.89
========== ========== ========== ========== ==========
Total return (d)................. 10.94% 22.20% 31.63% (3.81)% 16.77%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) . $4,589,771 $3,865,256 $2,700,515 $1,832,164 $1,557,332
Ratio of expenses to average net
assets ......................... 0.54% 0.48% 0.49% 0.49% 0.49%
Ratio of net investment income
to average net assets .......... 0.11% 0.24% 0.28% 0.12% 0.28%
Portfolio turnover rate ......... 123% 108% 127% 92% 89%
Average commission rate
paid (f) ....................... $0.0571 $0.0263 -- -- --
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------
1992 1991 1990 1989 1988
---------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
year (a) ....................... $ 33.82 $ 19.37 $ 19.90 $ 14.07 $ 14.09
---------- -------- -------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income .......... 0.17 0.12 0.16 0.23 0.20
Net realized and unrealized
gain (loss) on investments.... (1.25) 16.68 1.46 5.87 (0.03)
---------- -------- -------- ------- -------
Total from investment
operations ................... (1.08) 16.80 1.62 6.10 0.17
---------- -------- -------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment
income........................ (0.18) (0.10) (0.16) (0.23) (0.19)
Dividends in excess of net
investment income............. -- -- -- -- --
Distributions from realized
gains......................... (2.75) (2.25) (1.99) (0.04) --
Distributions in excess of
realized gains................ -- -- -- -- --
Tax return of capital
distributions................. -- -- -- -- --
---------- -------- -------- ------- -------
Total dividends and
distributions................. (2.93) (2.35) (2.15) (0.27) (0.19)
---------- -------- -------- ------- -------
Net asset value, end of year ... $ 29.81 $ 33.82 $ 19.37 $ 19.90 $ 14.07
========== ======== ======== ======= =======
Total return (d)................. (3.16)% 86.87% 8.16% 43.50% 1.13%
========== ======== ======== ======= =======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) . $1,210,576 $959,257 $120,960 $99,459 $62,116
Ratio of expenses to average net
assets ......................... 0.50% 0.51% 0.55% 0.55% 0.65%
Ratio of net investment income
to average net assets .......... 0.57% 0.40% 0.78% 1.29% 1.35%
Portfolio turnover rate ......... 68% 117% 54% 89% 70%
Average commission rate
paid (f) ....................... -- -- -- -- --
</TABLE>
<PAGE>
ALLIANCE SMALL CAP GROWTH PORTFOLIO:
<TABLE>
<CAPTION>
MAY 1, 1997
TO
DECEMBER 31, 1997
-----------------
<S> <C>
Net asset value, beginning of period (a) ............. $ 10.00
-----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ............................... 0.01
Net realized and unrealized gain on investments ..... 2.65
-----------------
Total from investment operations .................... 2.66
-----------------
LESS DISTRIBUTIONS:
Dividends from net investment income ................ (0.01 )
Distributions from realized gains ................... (0.30 )
-----------------
Total dividends and distributions ................... (0.31 )
-----------------
Net asset value, end of period........................ $ 12.35
=================
Total return (d) ..................................... 26.74 %
=================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) .................... $94,676
Ratio of expenses to average net assets .............. 0.95 %(b)
Ratio of net investment income to average net assets 0.10 %(b)
Portfolio turnover rate .............................. 96 %
Average commission rate paid.......................... $0.0488
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
The Hudson River Trust 6
<PAGE>
FIXED INCOME SERIES
ALLIANCE MONEY MARKET PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1997 1996 1995 1994 1993*
--------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of year(a)..................... $10.17 $10.16 $10.14 $10.12 $10.11
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income.......... 0.54 0.54 0.57 0.41 0.30
Net realized and
unrealized gain (loss)
on investments................ -- (0.01) -- -- --
---------- ---------- ---------- ---------- ----------
Total from investment
operations.................... 0.54 0.53 0.57 0.41 0.30
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net
investment income............. (0.53) (0.52) (0.55) (0.39) (0.29)
Distributions from realized
gains......................... (0.00) -- -- -- --
Total dividends and
distributions ................ (0.53) (0.52) (0.55) (0.39) (0.29)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year .. $10.18 $10.17 $10.16 $10.14 $10.12
========== ========== ========== ========== ==========
Total return (d)................ 5.42% 5.33% 5.74% 4.02% 3.00%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $449,960 $463,422 $386,691 $325,391 $248,460
Ratio of expenses to average
net assets..................... 0.39% 0.43% 0.44% 0.42% 0.42%
Ratio of net investment
income to average net
assets......................... 5.28% 5.17% 5.53% 4.01% 2.91%
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1992 1991 1990 1989 1988
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of year(a) $10.13 $10.17 $10.14 $10.13 $10.09
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income.......... 0.37 0.61 0.81 0.89 0.73
Net realized and
unrealized gain (loss)
on investments................ (0.01) -- 0.01 0.01 (0.01)
---------- ---------- ---------- ---------- ----------
Total from investment
operations.................... 0.36 0.61 0.82 0.90 0.72
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net
investment income............. (0.38) (0.65) (0.79) (0.89) (0.68)
Distributions from realized
gains......................... -- -- -- -- --
Total dividends and
distributions ................ (0.38) (0.65) (0.79) (0.89) (0.68)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year .. $ 10.11 $ 10.13 $ 10.17 $ 10.14 $ 10.13
========== ========== ========== ========== ==========
Total return (d)................ 3.57% 6.20% 8.22% 9.18% 7.32%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $268,584 $302,395 $359,426 $289,338 $234,378
Ratio of expenses to average
net assets..................... 0.43% 0.43% 0.44% 0.44% 0.48%
Ratio of net investment
income to average net
assets......................... 3.63% 5.96% 7.85% 8.70% 7.14%
</TABLE>
<PAGE>
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO (e):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------
1997 1996 1995 1994 1993* 1992
--------- -------- -------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) ..... $ 9.29 $ 9.47 $ 8.87 $10.08 $10.53 $10.73
---------- --------- --------- --------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income........................ 0.53 0.54 0.58 0.65 0.59 0.60
Net realized and unrealized gain (loss) on
investments................................. 0.13 (0.19) 0.57 (1.08) 0.51 (0.02)
---------- --------- --------- --------- ---------- ----------
Total from investment operations............. 0.66 0.35 1.15 (0.43) 1.10 0.58
---------- --------- --------- --------- ---------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income ........ (0.51) (0.53) (0.55) (0.78) (0.68) (0.60)
Distributions from realized gains............ -- -- -- -- (0.87) (0.18)
---------- --------- --------- --------- ---------- ----------
Total dividends and distributions............ (0.51) (0.53) (0.55) (0.78) (1.55) (0.78)
---------- --------- --------- --------- ---------- ----------
Net asset value, end of period................ $ 9.44 $ 9.29 $ 9.47 $ 8.87 $10.08 $10.53
========== ========= ========= ========= ========== ==========
Total return (d).............................. 7.29% 3.78% 13.33% (4.37)% 10.58% 5.53%
========== ========= ========= ========= ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)............. $115,114 $88,384 $71,780 $48,518 $158,511 $293,587
Ratio of expenses to average net assets ...... 0.55% 0.56% 0.57% 0.56% 0.53% 0.52%
Ratio of net investment income to average net
assets....................................... 5.61% 5.73% 6.15% 6.75% 5.43% 5.63%
Portfolio turnover rate....................... 285% 318% 255% 133% 254% 316%
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
APRIL 1, 1991
TO
DECEMBER 31, 1991
--------------------
<S> <C>
Net asset value, beginning of period (a) ..... $10.00
----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income........................ 0.52
Net realized and unrealized gain (loss) on
investments................................. 0.66
----------
Total from investment operations............. 1.18
----------
LESS DISTRIBUTIONS:
Dividends from net investment income ........ (0.34)
Distributions from realized gains............ (0.11)
----------
Total dividends and distributions............ (0.45)
----------
Net asset value, end of period................ $ 10.73
==========
Total return (d).............................. 12.10%
==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)............. $241,290
Ratio of expenses to average net assets ...... 0.43%
Ratio of net investment income to average net
assets....................................... 4.88%
Portfolio turnover rate....................... 174%
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
7 The Hudson River Trust
<PAGE>
ALLIANCE QUALITY BOND PORTFOLIO:
<TABLE>
<CAPTION>
OCTOBER 1, 1993
TO
YEAR ENDED DECEMBER 31, DECEMBER 31, 1993
--------------------------------------------- ------------------
1997 1996 1995 1994
--------- --------- --------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a)................. $ 9.49 $ 9.61 $ 8.72 $ 9.82 $10.00
---------- --------- --------- -------- ------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................................... 0.60 0.57 0.57 0.66 0.11
Net realized and unrealized gain (loss) on
investments and foreign currency transactions......... 0.24 (0.07) 0.88 (1.16) (0.16)
---------- --------- --------- -------- ------
Total from investment operations........................ 0.84 0.50 1.45 (0.50) (0.05)
---------- --------- --------- -------- ------
LESS DISTRIBUTIONS:
Dividends from net investment income.................... (0.59) (0.60) (0.56) (0.55) (0.12)
Dividends in excess of net investment income............ -- (0.02) -- -- --
Distributions in excess of realized gains............... -- -- -- -- (0.01)
Tax return of capital distributions..................... -- -- -- (0.05) --
---------- --------- --------- -------- ------
Total dividends and distributions....................... (0.59) (0.62) (0.56) (0.60) (0.13)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period........................... $9.74 $9.49 $9.61 $8.72 $9.82
========== ========== ========== ========== ==========
Total return (d)......................................... 9.14% 5.36% 17.02% (5.10)% (0.51)%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)........................ $203,233 $155,023 $157,443 $127,575 $104,832
Ratio of expenses to average net assets.................. 0.57% 0.59% 0.59% 0.59% 0.69%(b)
Ratio of net investment income to average net assets..... 6.19% 6.06% 6.13% 7.17% 4.62%(b)
Portfolio turnover rate.................................. 374% 431% 411% 222% 77%
</TABLE>
ALLIANCE HIGH YIELD PORTFOLIO (g):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1997 1996 1995 1994 1993*
---------- ---------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period
(a)...................................... $10.02 $ 9.64 $ 8.91 $10.08 $ 9.15
---------- ---------- ---------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................. 1.04 1.02 0.98 0.89 0.94
Net realized and unrealized gain (loss)
on investments ....................... 0.75 1.07 0.73 (1.17) 1.10
---------- ---------- ---------- --------- ---------
Total from investment operations ....... 1.79 2.09 1.71 (0.28) 2.04
---------- ---------- ---------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income .. (0.97) (0.98) (0.94) (0.88) (0.92)
Dividends in excess of net investment
income................................ -- (0.03) (0.04) (0.01) --
Distributions from realized gains ...... (0.43) (0.70) -- -- (0.19)
---------- ---------- ---------- --------- ---------
Total dividends and distributions ...... (1.40) (1.71) (0.98) (0.89) (1.11)
---------- ---------- ---------- --------- ---------
Net asset value, end of period........... $10.41 $10.02 $ 9.64 $ 8.91 $10.08
========== ========== ========== ========= =========
Total return (d)......................... 18.48% 22.89% 19.92% (2.79)% 23.15%
========== ========== ========== ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ....... $355,473 $199,360 $118,129 $73,895 $67,169
Ratio of expenses to average net assets . 0.62% 0.59% 0.60% 0.61% 0.63%
Ratio of net investment income to
average net assets ..................... 9.82% 9.93% 10.34% 9.23% 9.52%
Portfolio turnover rate ................. 390% 485% 350% 248% 280%
</TABLE>
<PAGE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------
1992 1991 1990 1989 1988
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period
(a)...................................... $ 8.96 $ 7.97 $ 9.14 $ 9.72 $ 9.67
--------- --------- --------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................. 0.89 0.89 1.04 1.09 1.00
Net realized and unrealized gain (loss)
on investments ....................... 0.19 0.99 (1.14) (0.60 ) (0.08 )
--------- --------- --------- --------- ---------
Total from investment operations ....... 1.08 1.88 (0.10) 0.49 0.92
--------- --------- --------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income .. (0.89 ) (0.89 ) (1.07) (1.07 ) (0.87 )
Dividends in excess of net investment
income................................ -- -- -- -- --
Distributions from realized gains ...... -- -- -- -- --
--------- --------- --------- --------- ---------
Total dividends and distributions ...... (0.89 ) (0.89 ) (1.07) (1.07 ) (0.87 )
--------- --------- --------- --------- ---------
Net asset value, end of period........... $ 9.15 $ 8.96 $ 7.97 $ 9.14 $ 9.72
========= ========= ========= ========= =========
Total return (d)......................... 12.31 % 24.46 % (1.10)% 5.14 % 9.73 %
========= ========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ....... $47,687 $45,066 $36,569 $41,280 $34,810
Ratio of expenses to average net assets . 0.60 % 0.61 % 0.62% 0.62 % 0.73 %
Ratio of net investment income to
average net assets ..................... 9.58 % 10.31 % 12.04% 11.22 % 10.05 %
Portfolio turnover rate ................. 177 % 187 % 53% 116 % 209 %
</TABLE>
- ------------
Footnotes appear on page 9.
- -------------------------------------------------------------------------------
The Hudson River Trust 8
<PAGE>
- ------------
FOOTNOTES TO FINANCIAL HIGHLIGHTS
* Prior to July 22, 1993, Equitable Capital Management Corporation
("Equitable Capital") served as the investment adviser to the Trust. On
July 22, 1993, Alliance Capital Management L.P. ("Alliance") acquired
the business and substantially all of the assets of Equitable Capital
and became the investment adviser to the Trust.
(a) Date as of which funds were first allocated to the Portfolios are as
follows:
Alliance Common Stock Portfolio -- June 16, 1975
Alliance Money Market Portfolio -- July 13, 1981
Alliance Balanced Portfolio -- January 27, 1986
Alliance Aggressive Stock Portfolio -- January 27, 1986
Alliance High Yield Portfolio -- January 2, 1987
Alliance Global Portfolio -- August 27, 1987
Alliance Conservative Investors Portfolio -- October 2, 1989
Alliance Growth Investors Portfolio -- October 2, 1989
Alliance Intermediate Government Securities Portfolio -- April 1, 1991
Alliance Quality Bond Portfolio -- October 1, 1993
Alliance Growth and Income Portfolio -- October 1, 1993
Alliance Equity Index Portfolio -- March 1, 1994
Alliance International Portfolio -- April 3, 1995
Alliance Small Cap Growth Portfolio -- May 1, 1997
(b) Annualized.
(c) Net investment income and capital changes per share are based upon
monthly average shares outstanding.
(d) Total return is calculated assuming an initial investment made at net
asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total return calculated for a
period of less than one year is not annualized.
(e) On February 22, 1994 shares of the Alliance Intermediate Government
Securities Portfolio of the Trust were substituted for shares of the
Trust's Alliance Short-Term World Income Portfolio.
(f) For fiscal years beginning on or after September 1, 1995, a portfolio
is required to disclose its average commission rate paid per share for
equity security trades on which commissions are charged.
(g) On December 16, 1992, the Trust's Board of Trustees declared a 10-for-1
stock split of the outstanding shares of the Alliance Money Market,
Alliance High Yield, Alliance Balanced, Alliance Common Stock, Alliance
Global and Alliance Aggressive Stock Portfolios ("Split Portfolios").
The split was effected on January 1, 1993 for shareholders of record on
that date. Consequently, the information presented in the tables above
for each Split Portfolio share outstanding throughout each period
(other than the periods ended prior to January 1, 1993), and the shares
outstanding at the end of such periods presented for the Split
Portfolios, has been restated.
(h) The Alliance Balanced Portfolio's portfolio turnover rates in 1997 and
1996 were 95% and 139%, respectively, for the equity component and were
192% and 221%, respectively, for the fixed income component.
- -------------------------------------------------------------------------------
9 The Hudson River Trust
<PAGE>
3. The section entitled "The Trust" is revised by replacing the fourth
paragraph thereof with the following:
The Trust's shares are sold only to separate accounts of insurance companies
in connection with variable life insurance contracts and variable annuity
certificates and contracts (collectively, the "Contracts") issued by The
Equitable Life Assurance Society of the United States ("Equitable") and
certain insurance companies unaffiliated with Equitable. Equitable was the
record owner of approximately 99.7% and 100% of the Trust's Class IA and
Class IB shares, respectively, as of March 31, 1998, and consequently may be
deemed to control the Trust.
4. The section entitled "Investment Objectives and Policies--Alliance
Conservative Investors Portfolio--Investment Policies" is revised by
replacing the second paragraph thereof with the following:
The Portfolio will at all times hold at least 40% of its assets in investment
grade fixed income securities, each having a duration, as determined by
Alliance, that is less than that of a 10-year Treasury bond (the "Fixed
Income Core"). Duration is a measure that relates the price volatility of a
bond to changes in interest rates. The duration of a bond is the weighted
average term to maturity, expressed in years, of the present value of all
future cash flows, including coupon payments and principal repayments. Thus,
by definition, duration is always less than or equal to full maturity. In
some cases, Alliance's calculation of duration will be based on certain
assumptions (including assumptions regarding prepayment rates, in the case of
mortgage-backed or asset-backed securities, and foreign and domestic interest
rates). As of December 31, 1997, the duration of a 10-year Treasury bond was
considered by Alliance to be 7.3 years.
5. The section entitled "Investment Objectives and Policies--Alliance Growth
Investors Portfolio--Investment Policies" is revised by replacing the
first paragraph thereof with the following:
The Alliance Growth Investors Portfolio attempts to achieve its investment
objective by allocating varying portions of its assets to a number of asset
classes. Equity investments will include both exchange-traded and
over-the-counter common stocks and equity-type securities, which may include
preferred stock and convertible securities, and may include securities issued
by intermediate-and small-sized companies that, in the opinion of Alliance,
have favorable growth prospects. More risk is associated with investment in
intermediate and small-sized companies because they are often dependent on
limited product lines, financial resources or management groups. They may be
more vulnerable to competition from larger companies with greater resources
and to economic conditions affecting their market sector. Intermediate-and
small-sized companies may be new, without long business or management
histories, and perceived by the market as unproven. Their securities may be
held primarily by insiders or institutional investors, and may trade
infrequently or in limited volume. The prices of these stocks often fluctuate
more than those of larger, more established companies. Fixed income
investments will include investment grade fixed income securities (including
cash and money market instruments) as well as securities that have a high
current yield and that are either rated in the lower categories by nationally
recognized statistical rating organizations ("NRSROs") (i.e., Baa or lower by
Moody's or BBB or lower by S&P) or are unrated. For a discussion of the risks
associated with investment in these higher yielding securities, see
"Investment Techniques--Fixed Income Securities"; and "Investment
Techniques--Risk Factors of Lower Rated Fixed Income Securities," below. For
the fiscal year ended December 31, 1997, approximately 19% of the Portfolio
was invested in fixed income securities. No more than 30% of the Portfolio's
assets will be invested in securities of non-U.S. issuers. See "Investment
Techniques--Foreign Securities and Currencies," below.
6. The section entitled "Investment Objectives and Policies--Alliance Common
Stock Portfolio--Investment Policies" is revised by replacing the third
paragraph thereof with the following:
If, in light of economic conditions and the general level of common stock
prices, it appears that the Portfolio's investment objective will not be met
by using all its assets to buy equities, the Alliance Common Stock Portfolio
may also use part of its assets to make nonequity investments. These could
include buying securities such as nonparticipating and nonconvertible
preferred stocks and certain fixed income securities. Fixed income securities
will include investment grade bonds and debentures and money market
instruments, as well as securities that have a high current yield because
they are either rated in the lower categories by NRSROs (i.e., Baa or lower
by Moody's or BBB or lower by S&P) or are unrated. For a discussion of the
risks associated with investment in these higher yielding securities, see
"Investment
- ------------------------------------------------------------------------------
The Hudson River Trust 10
<PAGE>
Techniques--Fixed Income Securities" and "Investment Techniques--Risk Factors
of Lower Rated Fixed Income Securities," below. For the fiscal year ended
December 31, 1997, less than 1% of the average assets of the Portfolio were
invested in higher yielding securities.
7. The section entitled "Investment Objectives and Policies--Alliance Small
Cap Growth Portfolio--Investment Policies" is revised by replacing the
first paragraph thereof with the following:
The Alliance Small Cap Growth Portfolio pursues its objective by investing
primarily in U.S. common stocks and other equity-type securities issued by
smaller companies with favorable growth prospects. The Alliance Small Cap
Growth Portfolio may also invest a portion of its assets in securities of
companies in cyclical industries, companies whose securities are temporarily
undervalued, companies in special situations and less widely known companies.
8. The section entitled "Investment Objectives and Policies--Alliance
Intermediate Government Securities Portfolio--Investment Policies" is
revised by replacing the fifth paragraph thereof with the following:
The Portfolio buys and sells securities with a view to maximizing current
return without, in the view of Alliance, undue risk to principal. Potential
capital gains resulting from possible changes in interest rates will not be a
major consideration. The Portfolio may take full advantage of a wide range of
maturities of U.S. Government Securities and may adjust the dollar-weighted
average maturity of its portfolio from time to time, depending on Alliance's
assessment of relative yields on securities of different maturities and the
expected effect of future changes in interest rates on the market value of
the securities held by the Portfolio. However, at all times, each instrument
held by the Portfolio will have either a final maturity of not more than ten
years or a duration, as determined by Alliance, not exceeding that of a
10-year Treasury note. Duration is a measure that relates the price
volatility of a security to changes in interest rates. The duration of a
security is the weighted average term to maturity, expressed in years, of the
present value of all future cash flows, including coupon payments and
principal repayments. Thus, by definition, duration is always less than or
equal to full maturity. In some cases, Alliance's calculation of duration
will be based on certain assumptions (including assumptions regarding
prepayment rates, in the mortgage-backed or asset-backed securities, and
foreign and domestic interest rates). As of December 31, 1997, the duration
of a 10-year Treasury bond was considered by Alliance to be 7.3 years. The
Portfolio may also invest a substantial portion of its assets in money market
instruments. See "Investment Techniques--Certain Money Market Instruments,"
below.
9. The section entitled "Investment Objectives and Policies--Alliance High
Yield Portfolio--Investment Policies" is revised by replacing the third
paragraph thereof with the following:
For the fiscal year ended December 31, 1997, the approximate percentages of
the Portfolio's average assets invested in securities of each rating
category, determined on a dollar weighted basis, were as follows: 10% in
securities rated AAA or its equivalent, 6.8% in securities rated BB or its
equivalent, 69.2% in securities rated B or its equivalent and 4% in
securities rated CCC or its equivalent. Of these securities, 90% were rated
by an NRSRO and 10% were unrated. All of the unrated securities were
considered by the investment adviser to be of comparable quality to the
Portfolio's investments rated by an NRSRO.
10. The section entitled "Investment Techniques--Options" is revised by
replacing the third paragraph thereof with the following:
Options purchased or written by the Portfolios may be traded on the national
securities exchanges or negotiated with a dealer. Options traded in the
over-the-counter market may not be as actively traded as those on an
exchange, so it may be more difficult to value such options. In addition,
such options are subject to the risk that the counterparty may fail to meet
its obligations to the Fund, and it may be difficult to enter into closing
transactions with respect to such options. Such options, and the securities
used as "cover" for such options, may be considered illiquid securities.
11. The section entitled "Investment Techniques--Options" is revised by
replacing the fifth paragraph thereof with the following:
The Portfolios, except the Alliance Money Market, Alliance Intermediate
Government Securities and Alliance Equity Index Portfolios, may purchase put
and call options and write covered put and call
- -------------------------------------------------------------------------------
11 The Hudson River Trust
<PAGE>
options on foreign currencies for the purpose of protecting against declines
in the dollar value of portfolio securities and against increases in the
dollar cost of securities to be acquired. Such investment strategies will be
used as a hedge and not for speculation. As in the case of other types of
options, however, the writing of an option on foreign currency will
constitute only a partial hedge, up to the amount of the premium received,
and the Portfolio could be required to purchase or sell foreign currencies at
disadvantageous exchange rates, thereby incurring losses. The purchase of an
option on foreign currency may constitute an effective hedge against
fluctuations in exchange rates although, in the event of rate movements
adverse to the Portfolio's position, it may forfeit the entire amount of the
premium plus related transaction costs. Options on foreign currencies may be
traded on the national securities exchanges or in the over-the-counter
market. As described above, options traded in the over-the-counter market may
not be as actively traded as those on an exchange, so it may be more
difficult to value such options. In addition, such options are subject to the
risk that the counterparty may fail to meet its obligations to the Fund, and
it may be difficult to enter into closing transactions with respect to
options traded over-the-counter.
12. The section entitled "Investment Techniques--Foreign Securities and
Currencies" is revised by replacing the first paragraph thereof with the
following:
All of the Portfolios, except the Alliance Intermediate Government Securities
and Alliance Equity Index Portfolios, may invest in foreign securities. For
these purposes, "foreign securities" are securities of foreign issuers that
are not traded in U.S. markets. Each of the Portfolios, except the Alliance
Intermediate Government Securities Portfolio, may invest in American
depositary receipts and securities of foreign issuers that are traded in U.S.
markets. These securities may involve certain of the risks described below
for foreign securities.
13. The section entitled "Management of the Trust--The Portfolio Managers" is
replaced with the following:
THE PORTFOLIO MANAGERS
THE ASSET ALLOCATION SERIES
- ---------------------------
ALLIANCE CONSERVATIVE INVESTORS, ALLIANCE BALANCED AND ALLIANCE GROWTH
INVESTORS PORTFOLIOS
Robert G. Heisterberg has been the person principally responsible for the
Alliance Conservative Investors, Alliance Balanced and Alliance Growth
Investors Portfolios' investment programs since February 12, 1996. Mr.
Heisterberg, a Senior Vice President of Alliance and Global Economic Policy
Analysis, has been associated with Alliance since 1977.
THE EQUITY SERIES
- -----------------
ALLIANCE GROWTH AND INCOME PORTFOLIO
Paul Rissman and W. Theodore Kuck have been the persons principally
responsible for the Alliance Growth and Income Portfolio's investment
program, Mr. Rissman since 1996 and Mr. Kuck since the Portfolio's inception.
Mr. Rissman, a Senior Vice President of Alliance, has been associated with
Alliance since 1989. Mr. Kuck, a Vice President of Alliance, has been
associated with Alliance since 1971.*
ALLIANCE EQUITY INDEX PORTFOLIO
Judith A. DeVivo has been the person principally responsible for the Alliance
Equity Index Portfolio's investment program since its inception. Ms. DeVivo,
a Vice President of Alliance, has been associated with Alliance since 1970.
ALLIANCE COMMON STOCK PORTFOLIO
Tyler J. Smith has been the person principally responsible for the Alliance
Common Stock Portfolio's investment program since 1977. Mr. Smith, a Senior
Vice President of Alliance, has been associated with Alliance since 1970.*
- -------------------------------------------------------------------------------
The Hudson River Trust 12
<PAGE>
ALLIANCE GLOBAL AND ALLIANCE INTERNATIONAL PORTFOLIOS
Bruce Calvert and Ronald L. Simcoe have been the persons principally
responsible for the Alliance Global Portfolio's investment program, Mr.
Calvert since 1998 and Mr. Simcoe since 1988; and the Alliance International
Portfolio's investment program, Mr. Calvert since 1998 and Mr. Simcoe since
its inception. Mr. Calvert, the Vice Chairman and Chief Investment Officer of
Alliance, has been associated with Alliance since 1973. Mr. Simcoe, a Vice
President of Alliance, has been associated with Alliance since 1978.*
ALLIANCE AGGRESSIVE STOCK PORTFOLIO
Alden M. Stewart and Randall E. Haase have been the persons principally
responsible for the Alliance Aggressive Stock Portfolio's investment program
since 1993. Mr. Stewart, an Executive Vice President of Alliance, has been
associated with Alliance since 1970.* Mr. Haase, a Senior Vice President of
Alliance, has been associated with Alliance since 1988.*
ALLIANCE SMALL CAP GROWTH PORTFOLIO
Michael F. Gaffney has been the person principally responsible for the
Alliance Small Cap Growth Portfolio's investment program since its inception.
Mr. Gaffney, a Senior Vice President of Alliance, has been associated with
Alliance since 1987.*
THE FIXED INCOME SERIES
- -----------------------
ALLIANCE MONEY MARKET PORTFOLIO
Raymond J. Papera has been the person principally responsible for the
Alliance Money Market Portfolio's investment program since 1990. Mr. Papera,
a Senior Vice President of Alliance, has been associated with Alliance since
1990.*
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO
Patricia J. Young and Jeffrey S. Phlegar have been the persons principally
responsible for the Alliance Intermediate Government Securities Portfolio's
investment program, Ms. Young since 1995 and Mr. Phlegar since 1997. Ms.
Young, a Senior Vice President of Alliance, has been associated with Alliance
since 1992. Mr. Phlegar, a Senior Vice President of Alliance, has been
associated with Alliance since 1988.
ALLIANCE QUALITY BOND PORTFOLIO
Matthew Bloom has been the person principally responsible for the Alliance
Quality Bond Portfolio's investment program since 1995. Mr. Bloom, a Senior
Vice President of Alliance, has been associated with Alliance since 1989.
ALLIANCE HIGH YIELD PORTFOLIO
Wayne C. Tappe has been the person principally responsible for the Alliance
High Yield Portfolio's investment program since 1995. Mr. Tappe, a Senior
Vice President of Alliance, has been associated with Alliance since 1987.*
- ----------------------
* Prior to July 22, 1993, with Equitable Capital Management Corporation
("Equitable Capital"). On that date Alliance acquired the business and
substantially all of the assets of Equitable Capital and became the
investment adviser to the Trust.
14. The section entitled "Management of the Trust--The Trust's Expenses" is
replaced with the following:
THE TRUST'S EXPENSES
The Trust pays all of its operating expenses not specifically assumed by
Alliance. The expenses borne by the Trust include or could include taxes;
brokerage commissions; interest charges; securities lending fees; fees and
expenses of the registration or qualification of a Portfolio's securities
under federal or state securities laws; fees of the Portfolio's custodian,
transfer agent, independent accountants and legal counsel; all expenses of
shareholders' and trustees' meetings; all expenses of the preparation,
typesetting,
- -------------------------------------------------------------------------------
13 The Hudson River Trust
<PAGE>
printing and mailing to existing shareholders of prospectuses, prospectus
supplements, statements of additional information, proxy statements, and
annual and semi-annual reports; any proxy solicitor's fees and expenses;
costs of fidelity bonds and Trustees' liability insurance premiums as well as
extraordinary expenses such as indemnification payments or damages awarded in
litigation or settlements made; any membership fees of the Investment Company
Institute and similar organizations; costs of maintaining the Trust's
corporate existence and the compensation of Trustees who are not directors,
officers, or employees of Alliance or its affiliates. The following table,
reflecting the Trust's estimated expenses, is based on information for the
year ended December 31, 1997 and has been restated to reflect (i) the fees
that would have been paid to Alliance if the present advisory agreement had
been in effect as of January 1, 1997 and (ii) estimated accounting expenses
for the year ended December 31, 1997.
<TABLE>
<CAPTION>
ALLIANCE ALLIANCE
ALLIANCE ALLIANCE GROWTH ALLIANCE ALLIANCE SMALL
CONSERVATIVE ALLIANCE GROWTH AND EQUITY COMMON CAP
INVESTORS BALANCED INVESTORS INCOME INDEX STOCK GROWTH
TYPE OF EXPENSE PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------- -------------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Advisory
Fees .............. 0.48% 0.42% 0.52% 0.55% 0.32% 0.37% 0.90%
Other Expenses ..... 0.07% 0.05% 0.05% 0.04% 0.04% 0.03% 0.05%
-------------- ----------- ----------- ----------- ----------- ----------- -----------
Total Expenses ..... 0.55% 0.47% 0.57% 0.59% 0.36% 0.40% 0.95%
============== =========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
ALLIANCE
ALLIANCE ALLIANCE INTERMEDIATE ALLIANCE ALLIANCE
ALLIANCE AGGRESSIVE MONEY GOVERNMENT QUALITY HIGH ALLIANCE
GLOBAL STOCK MARKET SECURITIES BOND YIELD INTERNATIONAL
TYPE OF EXPENSE PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------- ----------- ------------ ----------- -------------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Advisory
Fees .............. 0.65% 0.54% 0.35% 0.50% 0.53% 0.60% 0.90%
Other Expenses ..... 0.08% 0.03% 0.04% 0.06% 0.05% 0.04% 0.18%
----------- ------------ ----------- -------------- ----------- ----------- ---------------
Total Expenses ..... 0.73% 0.57% 0.39% 0.56% 0.58% 0.64% 1.08%
=========== ============ =========== ============== =========== =========== ===============
</TABLE>
Actual investment advisory fees, other expenses and total expenses for the
year ended December 31, 1997 were as follows:
<TABLE>
<CAPTION>
ALLIANCE ALLIANCE
ALLIANCE ALLIANCE GROWTH ALLIANCE ALLIANCE SMALL
CONSERVATIVE ALLIANCE GROWTH AND EQUITY COMMON CAP
INVESTORS BALANCED INVESTORS INCOME INDEX STOCK GROWTH
TYPE OF EXPENSE PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO*
- ------------------- -------------- ----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Advisory
Fees .............. 0.50% 0.40% 0.52% 0.55% 0.33% 0.36% 0.90%
Other Expenses ..... 0.07% 0.05% 0.05% 0.03% 0.04% 0.03% 0.05%
-------------- ----------- ----------- ----------- ----------- ----------- ------------
Total Expenses ..... 0.57% 0.45% 0.57% 0.58% 0.37% 0.39% 0.95%
============== =========== =========== =========== =========== =========== ============
</TABLE>
<TABLE>
<CAPTION>
ALLIANCE
ALLIANCE ALLIANCE INTERMEDIATE ALLIANCE ALLIANCE
ALLIANCE AGGRESSIVE MONEY GOVERNMENT QUALITY HIGH ALLIANCE
GLOBAL STOCK MARKET SECURITIES BOND YIELD INTERNATIONAL
TYPE OF EXPENSE PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------- ----------- ------------ ----------- -------------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Advisory
Fees .............. 0.61% 0.51% 0.36% 0.50% 0.53% 0.59% 0.90%
Other Expenses ..... 0.08% 0.03% 0.03% 0.05% 0.04% 0.03% 0.18%
----------- ------------ ----------- -------------- ----------- ----------- ---------------
Total Expenses ..... 0.69% 0.54% 0.39% 0.55% 0.57% 0.62% 1.08%
=========== ============ =========== ============== =========== =========== ===============
</TABLE>
- ------------
* Annualized expenses for the period May 1, 1997 to December 31, 1997.
15. The following section is added after the section entitled "Management of
the Trust--Transactions with Affiliates":
YEAR 2000
Many computer software systems in use today cannot properly process
date-related information relating to periods from and after January 1, 2000.
Should any of the computer systems employed by the Trust's
- -------------------------------------------------------------------------------
The Hudson River Trust 14
<PAGE>
major service providers fail to process this type of information properly,
that could have a negative impact on the Trust's operations and services that
are provided to the Trust's shareholders. Alliance has advised the Trust that
it is reviewing all of its computer systems with the goal of modifying or
replacing such systems prior to January 1, 2000, to the extent necessary to
foreclose any such negative impact. In addition, Alliance has been advised by
the Trust's custodian that it is also in the process of reviewing its systems
with the same goal. As of the date of this prospectus, the Trust and Alliance
have no reason to believe that these goals will not be achieved. Similarly,
the values of certain of the portfolio securities held by the Trust may be
adversely affected by the inability of the securities' issuers or of third
parties to process this type of information properly.
16. The section entitled "Appendix B--Performance Information" is revised by
replacing the fifth paragraph thereof with the following:
Each Portfolio's performance may also be compared to the performance of other
mutual funds by Morningstar, Inc. which ranks mutual funds on the basis of
historical risk and total return. Morningstar rankings are calculated using
the mutual fund's average annual return for certain periods and a risk factor
that reflects the mutual fund's performance relative to three-month Treasury
bill monthly returns. Morningstar's rankings range from five stars (highest)
to one star (lowest) and represent Morningstar's assessment of the historical
risk level and total return of a mutual fund as a weighted average for 3-,
5-and 10-year periods. If the fund scores in the top 10% of its class it
receives 5 stars; if it falls in the next 22.5% it receives 4 stars; a place
in the middle 35% earns it 3 stars; those in the next 22.5% receive 2 stars;
and the bottom 10% get 1 star.
17. The section entitled "Appendix B--Performance Information" is revised by
replacing the thirteenth paragraph thereof with the following:
The Russell 2000 Index consists of the smallest 2,000 securities in the
Russell 3000 Index. (The Russell 3000 Index represents approximately 98% of
the investable U.S. equity market.) The Russell 2000 Index, widely regarded
in the industry as the premier measure of small capitalization stocks,
represents approximately 11% of the Russell 3000 Index total market
capitalization. The Russell 2000 Growth Index ("Russell 2000 Growth")
consists of that half of the 2,000 smallest of the 3,000 largest
capitalization U.S. companies that has higher price-to-book ratios and higher
forecasted growth.
18. The section entitled "Appendix B--Performance Information" is revised by
replacing the eighteenth paragraph thereof with the following:
The dates as of which funds were first allocated to the Portfolios are as
follows: the Alliance Common Stock Portfolio on June 16, 1975; the Alliance
Money Market Portfolio on July 13, 1981; the Alliance Balanced and Alliance
Aggressive Stock Portfolios on January 27, 1986; the Alliance High Yield
Portfolio on January 2, 1987; the Alliance Global Portfolio on August 27,
1987; the Alliance Conservative Investors and Alliance Growth Investors
Portfolios on October 2, 1989; the Alliance Intermediate Government
Securities Portfolio on April 1, 1991; the Alliance Quality Bond and Alliance
Growth and Income Portfolios on October 1, 1993; the Alliance Equity Index
Portfolio on March 1, 1994; the Alliance International Portfolio on April 3,
1995; and the Alliance Small Cap Growth Portfolio on May 1, 1997. In the
"Since Inception" columns of Table I and Table II below, the performance of
each Portfolio and its comparative indices is measured from the date funds
were first allocated to the Portfolios, except as follows: for the Alliance
Common Stock Portfolio and its comparative indices, from January 13, 1976,
the date on which the unit value was established and Contract owner
contributions were first accepted by the Alliance Common Stock Portfolio's
separate account predecessor; for the Lipper Money Market Funds Average, from
June 1, 1981; for the Lipper Balanced Funds and Small Company Growth Funds
Averages, from January 1, 1986; and for the Lipper Global Funds Average, from
August 28, 1987.
- -------------------------------------------------------------------------------
15 The Hudson River Trust
<PAGE>
19. The section entitled "Appendix B--Performance Information" is revised by
replacing Tables I, II and III thereunder with the following:
TABLE I
ANNUALIZED RATES OF RETURN
PERIODS ENDING DECEMBER 31, 1997
<TABLE>
<CAPTION>
SINCE
PORTFOLIO/BENCHMARKS 1 YEAR 3 YEARS 5 YEARS 10 YEARS 15 YEARS 20 YEARS INCEPTION
------ ------- ------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
THE ASSET ALLOCATION SERIES
ALLIANCE CONSERVATIVE INVESTORS ............. 13.25% 12.79% 8.79% -- -- -- 9.53%
Lipper Flexible Portfolio Average ........... 18.69 19.44 13.14 -- -- -- 12.15
70% Lehman Treasury/30% S&P 500.............. 16.71 17.18 11.87 -- -- -- 11.39
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE BALANCED ........................... 15.06 15.45 9.71 12.04% -- -- 12.30
Lipper Balanced Mutual Funds Average ........ 19.00 19.44 13.20 12.92 -- -- 12.33
50% S&P 500/50% Lehman Gov't Corp. .......... 21.56 21.68 14.63 21.19 -- -- 13.97
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE GROWTH INVESTORS.................... 16.87 18.48 13.17 -- -- -- 15.73
Lipper Flexible Portfolio Average ........... 18.69 19.44 13.14 -- -- -- 12.15
70% S&P 500/30% Lehman Gov't Corp. .......... 26.28 25.64 17.02 -- -- -- 14.48
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
THE EQUITY SERIES
ALLIANCE GROWTH AND INCOME................... 26.90 23.65 -- -- -- -- 15.94
Lipper Growth & Income Funds Average ........ 27.14 26.49 -- -- -- -- 18.48
75% S&P 500/25% Value Line Convertible ...... 29.54 28.62 -- -- -- -- 20.14
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE EQUITY INDEX........................ 32.58 30.35 -- -- -- -- 23.35
Lipper S&P 500 Index Funds Average........... 32.60 30.49 -- -- -- -- 23.31
S&P 500...................................... 33.36 31.15 -- -- -- -- 23.84
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE COMMON STOCK........................ 29.40 28.66 21.08 18.00 17.25% 17.56% 15.83
Lipper Growth Equity Mutual Funds Average ... 25.30 25.11 16.47 15.93 14.37 15.73 15.50
S&P 500...................................... 33.36 31.15 20.27 18.05 17.52 16.66 15.44
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE GLOBAL ............................. 11.66 14.99 16.15 13.74 -- -- 11.70
Lipper Global Mutual Funds Average........... 13.04 15.20 13.76 11.50 -- -- 9.10
MSCI World .................................. 15.76 16.62 15.34 10.57 -- -- 8.22
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE INTERNATIONAL....................... (2.98) -- -- -- -- -- 6.39
Lipper International Mutual Funds Average ... 5.44 -- -- -- -- -- 9.87
MSCI EAFE.................................... 1.78 -- -- -- -- -- 6.15
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE AGGRESSIVE STOCK.................... 10.94 21.29 14.92 19.00 -- -- 19.41
Lipper Small Company Growth Funds
Average..................................... 19.63 22.51 15.24 16.50 -- -- 14.06
50% S&P 400/50% Russell 2000................. 27.31 24.88 17.11 17.74 -- -- 15.12
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE SMALL CAP GROWTH ................... -- -- -- -- -- -- 26.74*
Lipper Small Company Growth Funds Average .. -- -- -- -- -- -- 29.36*
Russell 2000 Growth ......................... -- -- -- -- -- -- 27.66*
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
THE FIXED INCOME SERIES
ALLIANCE MONEY MARKET ....................... 5.42 5.50 4.69 5.78 6.59 -- 7.17
Lipper Money Market Mutual Funds Average .... 4.90 5.05 4.31 5.40 6.18 -- 6.89
3 Month T-Bill .............................. 5.23 5.41 4.71 5.61 6.33 -- 6.87
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES 7.29 8.06 5.94 -- -- -- 7.00
Lipper Intermediate Government Funds
Average..................................... 8.08 8.68 6.00 -- -- -- 7.19
Lehman Intermediate Government Bond ........ 7.72 8.65 6.39 -- -- -- 7.47
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE QUALITY BOND........................ 9.14 10.40 -- -- -- -- 5.80
Lipper Corporate Debt Funds A Rated
Average..................................... 9.17 10.01 -- -- -- -- 5.82
Lehman Aggregate Bond........................ 9.65 10.42 -- -- -- -- 6.51
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
ALLIANCE HIGH YIELD.......................... 18.48 20.42 15.89 12.80 -- -- 12.04
Lipper High Current Yield Mutual
Funds Average............................... 12.96 14.17 11.36 10.66 -- -- 9.78
ML Master.................................... 12.83 14.54 11.72 12.09 -- -- 11.39
- -------------------------------------------- ------ ------- ------- -------- -------- -------- ---------
</TABLE>
* Unannualized
- ------------------------------------------------------------------------------
The Hudson River Trust 16
<PAGE>
TABLE II
CUMULATIVE RATES OF RETURN
PERIODS ENDING DECEMBER 31, 1997
<TABLE>
<CAPTION>
SINCE
PORTFOLIO/BENCHMARKS 1 YEAR 3 YEARS 5 YEARS 10 YEARS 15 YEARS 20 YEARS INCEPTION
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
THE ASSET ALLOCATION SERIES
ALLIANCE CONSERVATIVE INVESTORS............. 13.25% 43.47% 52.41% -- -- -- 111.92%
Lipper Flexible Portfolio Average .......... 18.69 71.00 86.52 -- -- -- 160.04
70% Lehman Treasury/30% S&P 500 ............ 16.71 60.91 75.18 -- -- -- 143.55
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE BALANCED........................... 15.06 53.88 58.90 211.70% -- -- 298.86
Lipper Balanced Mutual Funds Average ...... 19.00 70.61 86.33 239.04 -- -- 302.62
50% S&P 500/50% Lehman Gov't Corp. ........ 21.56 80.14 97.96 583.14 -- -- 376.27
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE GROWTH INVESTORS................... 16.87 66.31 85.66 -- -- -- 233.71
Lipper Flexible Portfolio Average. ........ 18.69 71.00 86.52 -- -- -- 160.04
70% S&P 500/30% Lehman Gov't Corp. ........ 26.28 98.32 119.42 -- -- -- 205.24
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
THE EQUITY SERIES
ALLIANCE GROWTH AND INCOME.................. 26.90 89.07 -- -- -- -- 87.52
Lipper Growth & Income Funds Average ...... 27.14 102.81 -- -- -- -- 106.17
75% S&P 500/25% Value Line Convertible .... 29.54 112.80 -- -- -- -- 118.17
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE EQUITY INDEX ...................... 32.58 121.46 -- -- -- -- 123.85
Lipper S&P 500 Index Funds Average ........ 32.60 122.21 -- -- -- -- 123.31
S&P 500..................................... 33.36 125.60 -- -- -- -- 127.24
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE COMMON STOCK....................... 29.40 113.00 160.20 423.28 988.51% 2440.13% 2,422.45
Lipper Growth Equity Mutual Funds Average .. 25.30 97.08 117.56 356.18 710.84 2037.84 2,757.78
S&P 500..................................... 33.36 125.60 151.62 425.67 1,026.40 2080.13 2,248.74
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE GLOBAL............................. 11.66 52.06 111.38 262.34 -- -- 214.27
Lipper Global Mutual Funds Average ........ 13.04 53.69 92.92 205.52 -- -- 151.76
MSCI World ................................. 15.76 58.59 104.13 173.01 -- -- 126.45
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE INTERNATIONAL...................... (2.98) -- -- -- -- -- 18.57
Lipper International Mutual Funds Average .. 5.44 -- -- -- -- -- 30.12
MSCI EAFE................................... 1.78 -- -- -- -- -- 17.83
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE AGGRESSIVE STOCK................... 10.94 78.45 100.42 469.28 -- -- 730.05
Lipper Small Company Growth Funds Average . 19.63 84.83 105.11 371.28 -- -- 398.38
50% S&P 400/50% Russell 2000................ 27.31 94.76 120.25 412.08 -- -- 436.52
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE SMALL CAP GROWTH PORTFOLIO ....... -- -- -- -- -- -- 26.74
Lipper Small Company Growth Funds Average . -- -- -- -- -- -- 29.36
Russell 2000 ............................... -- -- -- -- -- -- 27.66
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
THE FIXED INCOME SERIES
ALLIANCE MONEY MARKET....................... 5.42 17.42 25.77 75.34 160.40 -- 212.76
Lipper Money Market Mutual Funds Average .. 4.90 15.94 23.52 69.20 146.11 -- 200.21
3 Month T-Bill.............................. 5.23 17.13 25.87 72.64 150.97 -- 199.34
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE INTERMEDIATE GOVERNMENT
SECURITIES................................. 7.29 26.18 33.44 -- -- -- 57.92
Lipper Intermediate Government Funds
Average ................................... 8.08 28.40 33.93 -- -- -- 59.98
Lehman Intermediate Government Bond ....... 7.72 28.25 36.31 -- -- -- 62.74
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE QUALITY BOND....................... 9.14 34.57 -- -- -- -- 27.07
Lipper Corporate Debt Funds A Rated Average 9.17 33.20 -- -- -- -- 27.23
Lehman Aggregate Bond....................... 9.65 34.63 -- -- -- -- 30.78
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
ALLIANCE HIGH YIELD......................... 18.48 74.60 109.05 233.48 -- -- 249.07
Lipper High Current Yield Bond Funds
Average ................................... 12.96 48.92 71.52 177.35 -- -- 181.23
ML Master .................................. 12.83 50.26 74.04 213.08 -- -- 227.68
- ------------------------------------------- -------- --------- --------- ---------- ---------- ---------- -----------
</TABLE>
- -------------------------------------------------------------------------------
17 The Hudson River Trust
<PAGE>
TABLE III
ANNUAL RATES OF RETURN
<TABLE>
<CAPTION>
ALLIANCE ALLIANCE ALLIANCE ALLIANCE ALLIANCE
YEAR ENDING COMMON MONEY AGGRESSIVE ALLIANCE HIGH ALLIANCE CONSERV.
DECEMBER 31 STOCK MARKET STOCK BALANCED YIELD GLOBAL INVESTORS
- ----------- -------- -------- ---------- --------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1976........ 9.2%*
1977........ -9.2
1978........ 8.2
1979........ 29.8
1980........ 50.1
1981........ -5.8 7.1%*
1982........ 17.6 13.0
1983........ 26.1 8.9
1984........ -2.0 10.9
1985........ 33.4 8.2
1986........ 17.3 6.6 35.9%* 29.1%*
1987........ 7.5 6.6 7.3 -0.9 4.7%* -13.3%*
1988........ 22.4 7.3 1.1 13.3 9.7 10.9
1989........ 25.6 9.2 43.5 25.8 5.1 26.7 3.1%*
1990........ -8.1 8.2 8.2 0.3 -1.1 -6.1 6.3
1991........ 37.9 6.2 86.9 41.3 24.5 30.5 19.8
1992........ 3.2 3.6 -3.2 -2.8 12.3 -0.5 5.6
1993........ 24.8 3.0 16.8 12.3 23.2 32.1 10.8
1994........ -2.1 4.0 -3.8 -8.0 -2.8 5.2 -4.1
1995........ 32.5 5.7 31.6 19.8 19.9 18.8 20.4
1996........ 24.3 5.3 22.2 11.7 22.9 14.6 5.2
1997 ....... 29.40 5.4 10.9 15.1 18.5 11.7 13.3
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
ALLIANCE
ALLIANCE ALLIANCE ALLIANCE GROWTH ALLIANCE ALLIANCE
YEAR ENDING GROWTH INTERMEDIATE QUALITY AND EQUITY ALLIANCE SMALL CAP
DECEMBER 31 INVESTORS GOVT. SECURITIES BOND INCOME INDEX INTERNATIONAL GROWTH
- ----------- -------- ----------------- -------- -------- -------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
1976 .......
1977 .......
1978 .......
1979 .......
1980 .......
1981 .......
1982 .......
1983 .......
1984 .......
1985 .......
1986 .......
1987 .......
1988 .......
1989........ 4.0%*
1990........ 10.7
1991........ 48.8 12.1%*
1992........ 4.9 5.5
1993........ 15.3 10.6 -0.5%* -0.3%*
1994........ -3.2 -4.4 -5.1 -0.6 1.1*
1995........ 26.4 13.3 17.0 24.0 36.5 11%
1996........ 12.6 3.8 5.4 20.1 22.4 9.8
1997 ....... 16.9 7.3 9.1 26.9 32.6 -2.98 26.74%*
</TABLE>
- ------------
* Unannualized from the inception date described in the Prospectus through the
end of the calendar year indicated.
- -------------------------------------------------------------------------------
The Hudson River Trust 18
<PAGE>
20. The section entitled "Appendix B--Performance Information--Performance of
Portfolios Managed Similarly to the Alliance Small Cap Growth Portfolio"
is revised by replacing the second paragraph thereof with the following:
Set forth below is performance data provided by Alliance relating to the
Historical Portfolios for each of the fifteen full calendar years during
which Alliance has managed the Historical Portfolios. As of December 31,
1997, the assets in the Historical Portfolios totaled approximately $988.4
million and the average size of a Historical Portfolio was $54.9 million.
Each Historical Portfolio has a nearly identical composition of individual
investment holdings and related percentage weightings.
21. The section entitled "Appendix B--Performance Information--Schedule of
Composite Investment Performance--Historical Portfolios for the Fifteen
Years Ended December 31, 1997*" is replaced with the following:
SCHEDULE OF COMPOSITE INVESTMENT PERFORMANCE--HISTORICAL PORTFOLIOS
FOR THE FIFTEEN YEARS ENDED DECEMBER 31, 1997*
<TABLE>
<CAPTION>
RUSSELL LIPPER SMALL CO.
HISTORICAL RUSSELL 2000 GROWTH GROWTH
PORTFOLIOS 2000 INDEX INDEX FUND INDEX
TOTAL RETURN TOTAL RESEARCH TOTAL RETURN TOTAL RETURN
-------------- -------------- -------------- ----------------
<S> <C> <C> <C> <C>
Year ended:
December 31, 1997 ........... 17.58% 22.37% 12.94% 15.05%
December 31, 1996 ........... 36.91% 16.50% 11.26% 14.37%
December 31, 1995 ........... 54.59% 28.45% 31.04% 31.62%
December 31, 1994 ........... -3.47% -1.82% -2.43% -0.48%
December 31, 1993 ........... 14.35% 18.88% 13.36% 16.93%
December 31, 1992 ........... 4.85% 18.41% 7.77% 11.18%
December 31, 1991 ........... 40.96% 46.04% 51.19% 48.53%
December 31, 1990 ........... -23.46% -19.48% -17.41% -13.78%
December 31, 1989 ........... 25.81% 16.26% 20.17% 21.06%
December 31, 1988 ........... 25.63% 25.02% 20.37% 20.34%
December 31, 1987 ........... -7.66% -8.80% -10.48% -5.48%
December 31, 1986 ........... 15.30% 5.68% 3.58% 6.04%
December 31, 1985 ........... 42.57% 31.05% 30.97% 27.27%
December 31, 1984 ........... -11.73% -7.30% -15.83% -9.18%
December 31, 1983 ........... 32.53% 29.13% 20.13% 29.80%
</TABLE>
- ------------
* Total return is a measure of investment performance that is based upon
the change in value of an investment from the beginning to the end of a
specified period and assumes reinvestment of all dividends and other
distributions. The basis of preparation of this data is described in
the preceding discussion.
The average annual total returns presented below are based upon the
cumulative total return as of December 31, 1997, assume a steady compounded
rate of return and are not year-by-year results, which fluctuated over the
periods as shown.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
----------------------------------------------------------
RUSSELL LIPPER SMALL CO.
HISTORICAL RUSSELL 2000 GROWTH GROWTH
PORTFOLIOS 2000 INDEX INDEX FUND INDEX
------------ ------------ ------------- ----------------
<S> <C> <C> <C> <C>
Three years ........... 35.51% 22.34% 18.09% 20.09%
Five years ............ 22.40% 16.41% 12.74% 15.05%
Ten years ............. 17.25% 15.77% 13.49% 15.38%
Since January 1, 1983 15.53% 13.34% 10.30% 13.04%
</TABLE>
- --------------------------------------------------------------------------------
19 The Hudson River Trust
