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VANGUARD CONVERTIBLE SECURITIES FUND, INC.
PROSPECTUS SUPPLEMENT
FEBRUARY 2, 1996
The Board of Directors of Vanguard Convertible Securities Fund, Inc. (the
"Fund") has approved a revised investment advisory agreement with Desai Capital
Management, Inc. ("DCMI"), the Fund's investment adviser. The new agreement
involves a reduction in the annual rate of advisory fees to be paid to DCMI.
Under the terms of the new agreement, the Fund will pay DCMI a basic
advisory fee at the end of each fiscal quarter. The fee will be calculated by
applying the following annual percentage rates, to the Fund's average month-end
net assets for the quarter:
<TABLE>
<CAPTION>
NET ASSETS ANNUAL BASIC FEE RATE
---------- ---------------------
<S> <C>
First $50 million 0.40%
Next $50 million 0.35
Next $100 million 0.30
Over $200 million 0.25
</TABLE>
This revised investment advisory agreement replaces the Fund's existing
agreement with the adviser dated March 1, 1988, and will go into effect on or
about March 1, 1996. Until this date, the adviser has agreed to waive its
advisory fees to the extent necessary to abide by the new fee schedule.
PSCV
