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The MainStay Funds
Supplement dated March 7, 1997 to the
Prospectus dated May 1, 1996
The Prospectus is amended as follows:
1. In the description of the Value Fund under the heading "Who's Managing your
Money?" on page 28 Mr. Kolefas' biography is hereby deleted and replaced with
the following:
Mr. Simon joined MacKay-Shields in 1993. Mr. Simon is a Director of MacKay-
Shields and specializes in equity securities. Previously, Mr. Simon was a
senior equity research analyst and portfolio manager at National Securities
and Research Corporation (from 1991-1992) and Neuberger & Berman (from
1987-1991)
2. Effective January 1, 1996, the Administrator voluntarily agreed to reduce its
fees payable by the Equity Index Fund to the extent that Fund's total
expenses (including Rule 12b-1 fees) for any fiscal year exceed .80% of the
value of the Fund's average annual net assets. See Note + to the chart on the
Administrator's fees on page 63.
3. In the section titled "Deferred Sales Charge Class B Shares - Contingent
Deferred Sales Charge, Class B" on page 68, the following subsection is added
at the end of the listing of redemptions for which the contingent deferred
sales charge will be waived:
and (xviii) redemptions by shareholders of shares purchased with the
proceeds of a settlement payment made in connection with the liquidation
and dissolution of a limited partnership sponsored by New York Life or one
of its affiliates.
4. In the description of the High Yield Corporate Bond Fund under the heading
"The Fund invests in..." on page 30, the first item under "Under normal
market conditions..." is hereby deleted and replaced with the following:
...at least 65% of total assets in corporate debt securities: all types of
foreign and domestic debt securities ordinarily in the lower rating
categories of Moody's (Baa to B) and S&P (BBB to B). These securities tend
to offer yields above those that are rated higher and are not considered
speculative.
5. In the description of the International Equity Fund and International Bond
Fund under the heading "Who's Managing your Money?" on pages 25 and 31,
respectively, Mr. Perelstein's biography is hereby deleted and replaced with
the following on page 31:
Mr. Portera is a Director of MacKay-Shields specializing in international
bonds. He returned to MacKay-Shields in December 1996 after working at
Fiduciary Trust Company International as a portfolio manager in
international bonds. Mr. Portera joined MacKay-Shields in 1991 and was
portfolio manager of the International Bond Fund from its inception in
September 1994 to August 1995. Previously, Mr. Portera was a portfolio
manager specializing in international debt securities at ABN-AMRO Bank,
N.V. (from 1988-1991).
Shigemi Takagi remains a portfolio manager of the International Equity Fund.
His biography appears on page 25.
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6. At the January 27, 1997 MainStay Funds Board Meeting, the Trustees approved a
change of investment policy for Convertible Fund which would require the
Fund, under normal market conditions, to invest at least 65% of its total
assets in dividend and interest-paying equity securities including common
stocks, preferred stocks and convertible securities. At least 30% of the
Fund's total assets will be invested in convertible securities under normal
market conditions. The Trustees also approved a corresponding change of the
Fund's name to Convertible-Equity Income Fund. These changes will be
effective May 1, 1997. The contingent deferred sales charge will be waived on
redemptions of Class B shares of the Convertible Fund purchased prior to
March 7, 1997 that are redeemed between April 21, 1997 and May 30, 1997.
