THE PBHG FUNDS, INC.
SUPPLEMENT DATED NOVEMBER 2, 1999
TO THE PROSPECTUS FOR THE PBHG CLASS SHARES
DATED JULY 31, 1999
This Supplement updates certain information contained in the
Prospectus, as supplemented on November 1, 1999. This Supplement supercedes and
replaces in its entirety the Supplement dated September 20, 1999. You should
retain the Prospectus and all Supplements for future reference. You may obtain
an additional copy of the Prospectus, as supplemented, free of charge by calling
1-800-433-0051.
On November 2, 1999, a special meeting of shareholders of the Fund was
held, at which shareholders approved two proposals: (1) to change the Fund from
a diversified to a non-diversified investment company and (2) to allow the Fund
to concentrate its investments in one or more industries in the technology and
communications sectors. Accordingly, effective immediately the following
replaces in its entirety the information appearing under the headings "MAIN
INVESTMENT STRATEGIES" and "MAIN INVESTMENT RISKS" on page 46 of the Prospectus:
MAIN INVESTMENT STRATEGIES
Under normal market conditions, the Fund, a non-diversified fund, will invest at
least 65% of its total assets in common stocks of companies doing business in
the technology and communications sectors of the market. In addition, the Fund
is concentrated which means it will invest 25% or more of its total assets in
one or more of the industries within these sectors. These industries may include
computer software and hardware, network and cable broadcasting, semiconductors,
defense and data storage and retrieval, and biotechnology. The Fund invests in
companies that may be responsible for breakthrough products or technologies or
may be positioned to take advantage of cutting-edge developments. The Fund's
holdings may range from smaller companies developing new technologies or
pursuing scientific breakthroughs to large, blue chip firms with established
track records in developing, using or marketing scientific advances. The Fund
may sell a security for a variety of reasons, such as to invest in a company
with more attractive growth prospects.
The Fund may use options and futures contracts for hedging and risk management.
MAIN INVESTMENT RISKS
The Fund is non-diversified which means, as compared to a diversified fund, it
invests a higher percentage of its assets in a limited number of stocks in order
to achieve a potentially greater investment return than a more diversified fund.
As a result, the price change of a single security, positive or negative, has a
greater impact on the Fund's net asset value and will cause its shares to
fluctuate in value more than it would in a more widely diversified fund.
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The Fund is concentrated which means, compared to a non-concentrated fund, it
invests a higher percentage of its assets in specific industries within the
technology and communications sectors of the market in order to achieve a
potentially greater investment return. As a result, the economic, political and
regulatory developments in a particular industry, positive or negative, have a
greater impact on the Fund's net asset value and will cause its shares to
fluctuate more than if the Fund did not concentrate its investments.
The value of your investment in the Fund will go up and down, which means you
could lose money.
The price of the securities in the Fund will fluctuate. These price movements
may occur because of changes in the financial markets, the company's individual
situation, or industry changes. These risks are greater for companies with
smaller market capitalizations because they tend to have more limited product
lines, markets and financial resources and may be dependent on a smaller
management group than larger, more established companies.
Securities of technology and communications companies are strongly affected by
worldwide scientific and technological developments and governmental policies
and, therefore, are generally more volatile than securities of companies not
dependent upon or associated with technology and communications issues.
The Fund's use of options and futures contracts may reduce returns or increase
volatility.
Although the Fund strives to achieve its goal, it cannot guarantee that the goal
will be achieved.
Your investment in the Fund is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency.
