PAINEWEBBER BALANCED FUND
SUPPLEMENT TO STATEMENT OF ADDITIONAL INFORMATION DATED DECEMBER 10, 1999
October 10, 2000
Dear Investor,
The board of directors for PaineWebber Balanced Fund has approved changes
to the fund's investment strategies that became effective on October 10, 2000.
As a result of these new investment strategies, the fund's Statement of
Additional Information ("SAI") is revised as follows:
THE DESCRIPTION OF PAINEWEBBER BALANCED FUND ON P. 2 OF THE SAI IN THE SECTION
CAPTIONED "THE FUNDS AND THEIR INVESTMENT POLICIES" IS REVISED BY REPLACING THE
THIRD PARAGRAPH IN ITS ENTIRETY WITH THE FOLLOWING:
For its stock investments, Balanced Fund seeks to replicate (before
fees and expenses) the total return of the Standard & Poor's
Composite Stock Price Index. For its bond investments, the fund
seeks to replicate (before fees and expenses) the total return of
the Lehman Brothers Aggregate Bond Index. To the extent necessary to
track the performances of these benchmark indices, the fund may
invest in U.S. dollar denominated securities of foreign issuers that
are traded on recognized U.S. exchanges or in the U.S.
over-the-counter market. The fund also may invest up to 10% of its
assets in bonds and other securities (including convertible
securities) rated below investment grade but rated at least B by
Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's, a
division of The McGraw-Hill Companies, Inc. ("S&P"), comparably
rated by another rating agency or, if unrated, determined by
Mitchell Hutchins to be of comparable quality. The fund's bond
investments may include zero coupon bonds and other original issue
discount securities.
