SECURITIES AND EXCHAGE COMMISSION
Washington, DC 20549
Registration No. 33-12703
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. ____________ _X_
Post -Effective Amendment No. ____13______ _X_
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 _X_
Amendment No. ______ 18__________________ _X_
VOLUMETRIC FUND, INC.
(exact Name of Registrant as specified in Charter)
87 VIOLET DRIVE, PEARL RIVER, NEW YORK 10965
(Address of Principal Executive Officers)
(914) 623-7637
(Registrant's Telephone Number)
Gabriel J. Gibs
Volumetric Fund, Inc.
87 Violet Drive, Pearl River, New York 10965
(Name and Address of Agent for Services)
Approximate Date of Proposed Public Offering: Feb 25, 2000
It is proposed that this filing will become effective
_X_ Immediately upon filing pursuant to paragraph (b)
___ on (date) pursuant to paragraph (b)
___ 60 days after filing pursuant to paragraph (b)
___ on (date) pursuant to paragraph (a) of rule 485
VOLUMETRIC FUND, INC.
Registration Statement on Form N-1A
CROSS REFERENCE SHEET
Form N-1A
Item No.
Prospectus
Part A Prospectus Caption Page Number
1. Cover Page Cover
2. *
3. Financial Highlights 3
4. The Fund; Investment Objective; 3;3;4;6
Investment Strategy; Investment Restrictions
5. Management; Officers and Directors 8,9
6. (a) Capital Stock 10
(b)-(d) *
(e) Cover Page;Shareholder Services Cover;8
(f)-(g)Dividends, Distributions and Tax Statues 8
7. How to Purchase Shares; Shareholder 6;8
Services
8. How to Redeem Shares 7
9. *
SAI
Part B Information Caption Page Number
10. Cover Page Cover
11. Table of Contents 2
12. History and General Information 2
13. Investment Objective and Approach 2
Investment Restrictions 3
14. Management of the Fund 4
15. Control Persons and Principal 6
Holders of Securities
_______________________
* Not Applicable
SAI
Part B Information Caption Page Number
16.(a) - (b Investment Advisory Services 6
(c) - (g) *
(h) See Prospectus
(I) *
17. Brokerage Allocation 7
18. See Prospectus
19. Purchase, Redemption and Pricing of 7
Securities
20. See Prospectus
21. *
22. Calculation of Performance Data 8
23. Financial Statements Annual Report
Part C Information Caption
Information required to be included in Part C
is set forth under the appropriate Item, so
numbered, in Part C to this Registration
Statement
PROSPECTUS February 25, 2000
VOLUMETRIC FUND, INC.
87 Violet Drive
Pearl River, New York 10965
(914)623-7637 (800)541-3863
OBJECTIVE
Volumetric Fund's (the "Fund") investment objective is
capital growth
INVESTMENT STYLE
The Fund invests in a broadly diversified portfolio of large
and mid-cap stocks, primarily those of the New York Stock
Exchange. Under negative stock market conditions, the Fund
may allocate a portion of its assets into money market or
cash equivalentsto minimize risk and for downside protection.
HISTORY
The Fund was established in 1978 and went public in 1987.
The Fund had an average annual return of 14.0% between
January 1, 1979, and December 31, 1999.
SALES AND REDEMPTION FEES
None. The Fund is 100% No-Load.
MINIMUM INVESTMENT
To open an account: $500
Additional purchase: $200
Automatic investment plan: $100
Investors are advised to read and retain this prospectus
for future reference. A "Statement of Additional
Information", dated February 25, 2000, containing further
information about the Fund has been filed with the
Securities and Exchange Commission and is hereby
incorporated by reference into this prospectus. A copy of
"Statement of Additional Information" is available without
charge by calling the Fund.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
TABLE OF CONTENTS
Summary of Fund Expenses......................... 2
The Fund......................................... 3
Investment Objective............................. 3
Financial Highlights............................. 3
Performance...................................... 4
Investment Strategy.............................. 4
Investment Restrictions.......................... 6
How to Purchase Shares........................... 6
"No-Fee" Retirement and Other Special Accounts... 7
How to Redeem Shares............................. 7
Shareholder Services............................. 8
Dividends, Distributions and Tax Statues......... 8
Management....................................... 8
Officers and Directors........................... 9
Capital Stock.................................... 10
Custodian, Trustee and Auditor................... 10
Listing Information.............................. 10
Application...................................... 11
SUMMARY OF FUND EXPENSES
The following table has been prepared to assist the
investor in understanding the various costs and expenses
that an investor in the Fund will bear directly or
indirectly. You should consider this expense information
along with other important information in this prospectus,
the Fund's investment objective and the Fund's past
performance. Please refer to the "MANAGEMENT" section of the
Prospectus for a more complete description of the various
costs and expenses.
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases..............None
Maximum Sales Load Imposed on Reinvest Dividends.....None
Deferred Sales Load..................................None
Redemption Fees......................................None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fee.......................................1.90%
12b-1 Fees...........................................None
Other Expenses.......................................None
TOTAL FUND OPERATING EXPENSES........................1.90%
You would pay the following expenses on a $1,000
investment assuming 5% annual return at the end of each time
period. The return of 5% and expenses should not be
considered indications of actual or expected fund
performance or expenses, both of which will vary. These
expenses are incorporated in the Fund's net asset value. You
do not pay them directly.
1 Year: $19 3 Years: $58 5 Years: $99 10 Years: $207
THE FUND
The Fund is a diversified, open-end management investment
company, as defined by the Investment Company Act of 1940.
It is called a no-load fund because its shares are sold
without a sales charge.
Between August of 1978, its inception, and June of 1986,
the Fund was operated as a private limited partnership,
under the name of The Volumetric Investment Society, with
the same investment objective, approach, restrictions and
management as described in this prospectus. Its name was
changed to Volumetric Fund, Inc. on June 15, 1986 and it was
incorporated under the laws of the State of New York on July
25, 1986. The Fund has been open to the general public since
September 3, 1987.
INVESTMENT OBJECTIVE
The Fund's investment objective is capital growth. Its
secondary objective is downside protection. The Fund
endeavors to accomplish its purpose through investments in
common stocks, principally those of the New York Stock
Exchange. The Fund may also invest in common stocks of other
exchanges, NASDAQ stocks and, for temporary defensive
purposes, may allocate up to 100% of its assets in cash
equivalents and debt instruments, such as United States
government securities and corporate bonds with Standard &
Poor`s rating of BBB or higher.
Since risks are inherent in all stock market investments,
there is no assurance that the investment objective of the
Fund will be realized.
The Fund's investment objective may not be changed
without shareholder approval.
FINANCIAL HIGHLIGHTS
The following table sets forth the per share operating
performance data for a share of capital stock outstanding,
total return, ratios to average net assets and other
supplemental data for each year indicated. The financial
highlights have been audited by Feuer & Orlando, Pye & Co,
L.L.P., independent certified public accountants, whose
report appears in the Fund's Annual Report. The Fund will
furnish a copy of its Annual Report upon request without
charge.
<TABLE>
<S> <C> <C> <C> <C> <C>
Year ending December 31 1999 1998 1997 1996 1995
Net Asset Value, beginning of period $19.25 $20.30 $18.38 $16.81 $14.33
Income from Investment Operations
Net investment income (0.06) (0.02) (0.03) 0.03 0.03
Net realized and unrealized
gain and losses on securities 1.03 1.86 3.16 2.44 2.45
----- ----- ----- ----- ------
Total from investment operations 0.97 1.84 3.13 2.47 2.48
----- ---- ----- ----- ------
Less distributions:
Dividends from net investment income 0.00 (0.00) (0.00) (0.06) 0.00
Distributions from capital gainss (0.56) (2.89) (1.21) (0.84) 0.00
------ ------ ------ ---- -------
Total Distributions (0.56) (2.89) (1.21) (0.90) 0.00
------ ------ ------ ------ ------
Net Asset Value end of period $19.66 $19.25 $20.30 $18.38 $16.81
====== ====== ====== ====== ======
Total Return 5.19% 10.57% 18.23% 15.52% 17.31%
====== ====== ====== ====== =======
Ratio and supplement data
Net assets,end of period(in thousands) $21,044 $20,539 $17,832 $14,286 $12,489
Ratio of expenses to average net assets 1.90% 1.97% 1.96% 1.99% 1.95%
Ratio of net inv income to avg net assets (0.32%) (0.13)% (0.17)% 0.19% 0.21%
Portfolio turnover rate 232% 237% 213% 154% 159%
</TABLE>
PERFORMANCE
During the period from January 1, 1979, beginning of the
Fund's first full year, to December 31, 1999, $10,000
invested in Volumetric Fund grew to $141,866, when all
distributions were reinvested. The Fund's average annual
total return from the beginning of 1979 until December 31,
1999, was 14.0%, as compared to that of the New York Stock
Exchange Composite ("NYSE") Index, an unmanaged index
incorporating the weighted average of all the stocks on the
New York Stock Exchange, which had a 13.0% average annual
return in the same period.
The performance of Volumetric Fund is expressed as total
return. Total return is the change in value of an
investment in a fund over a particular period, assuming that
all distributions have been reinvested. Thus, total return
reflects dividend income, capital gain distributions, and
variations in share prices at the beginning and end of a
period. It also incorporates deduction of expenses, such as
the payment of brokerage commissions and management fees.
Please bear in mind: past performance is not necessarily
indicative of future results. Further information about
performance is available in the Fund's annual and quarterly
reports which may be obtained free of charge.
From time to time, the Fund may advertise its performance
in various ways, including information on the Fund's average
annual total return and comparing the performance of the
Fund to relevant benchmarks. In reports to shareholders or
other literature, the Fund may compare its performance to
that of other mutual funds with similar investment
objectives and to stock or other relevant indices.
INVESTMENT STRATEGY
The Fund is using the unique Volumetric Trading System to
make investment decisions. This disciplined stock trading
system has been derived from Volumetrics, a proprietary
method of technical analysis which measures the flow of
money into and out of stocks by their volume activity.
Volumetrics was developed in the early 1970's by the Fund's
founder Gabriel J. Gibs. The basic concepts of Volumetrics
is described in Mr. Gibs' M.B.A. thesis entitled
"Forecasting Stock Trends by Volume Analysis" (Pace
University, 1974).
The stock selection strategy of the Fund involves the
identification of those stocks, mostly from the New York
Stock Exchange, for which a sudden and substantial new
demand is developing and are in their early or middle stages
of an upside move. As volume typically precedes price, the
Fund's timing system often successfully identifies stocks
under accumulation, takeover and restructuring candidates
and stocks that "smart money" buys. A simplified stock
screening process to achieve this is shown in the following
paragraphs.
THE FOLLOWING CHARTED INFORMATION WAS PRESENTED AS A BAR
GRAPH IN THE PROSPECTUS SHOWING THE COMPARISON OF CHANGE IN
VALUE OF A $10,000 INVESTMENT IN VOLUMETRIC FUND AND THE NEW
YORK STOCK EXCHANGE COMPOSITE INDEX*.
(Year Ending 12/31)
YEAR VOLUMETRIC NYSE INDEX
1978 $ 10,000 $ 10,000
1979 $ 11,630 $ 11,550
1980 $ 15,991 $ 14,456
1981 $ 18,712 $ 13,198
1982 $ 21,876 $ 15,046
1983 $ 26,321 $ 17,664
1984 $ 27,696 $ 17,894
1985 $ 36,524 $ 22,564
1986 $ 39,225 $ 25,723
1987 $ 38,637 $ 25,646
1988 $ 46,349 $ 28,954
1989 $ 53,743 $ 33,587
1990 $ 50,963 $ 31,068
1991 $ 68,902 $ 38,524
1992 $ 76,331 $ 40,334
1993 $ 77,839 $ 43,521
1994 $ 76,104 $ 42,128
1995 $ 89,336 $ 55,314
1996 $103,189 $ 71,160
1997 $121,987 $ 92,728
1998 $134,918 $108,074
1999 $141,866 $117,909
Average Annual Total Returns of the Fund (12-31-99)*
1 year 5 years 10 years Since 1-1-79
5.2% 13.4% 10.7% 14.0%
*All distributions and dividends were reinvested. Past performance
is not predictive of future performance.
1) Using a computerized data base, stocks are
identified from the New York Stock Exchange or Nasdaq, whose
price advanced during the previous day or week on unusually
heavy volume, relative to their own normal volume.
2) From this group of stocks, primary consideration is
given to those which exhibit high relative strength, are in
a strong industry group, have improved earnings prospects,
low debt and are not yet over-appreciated in price. This
group may also include turnaround situations and stocks with
some other positive investment characteristics.
3) Stocks with the most positive overall characteristics
from the above group are then further analyzed by a
proprietary mathematical model and the stock(s) with the
highest up/down volume ratio (demand/supply ratio) will be
bought.
A major aim of the Fund is to protect its porfolio against
declines during market corrections and bear markets. Therefore,
all stocks in the Fund's portfolio are under continuous daily
volume/price surveillance. Generally, a stock will be sold when
volume and price trend analysis indicate that there is a distinct
reversal in the price of the stock. Once a stock is sold, it will
be replaced by a new,stronger stock, or under negative stock
market conditions, proceeds from the sale may be invested in cash
equivalents, US treasury securities or corporate bonds with
S&P rating of BBB or higher.
The Fund allocates its assets between stocks and cash equivalents
using a proprietary asset allocation formula. Under most stock
market conditions, the cash position of the Fund would be between
3 to 15%. However, under negative stock market conditions the Fund's
cash position may increase up to 40%, and under extremely negative
conditions to over 40%.
The management does not take portfolio turnover into
account in making investment decisions. It is estimated
that most stocks in the Fund's portfolio will be held from 3
to 15 months, and the typical portfolio turnover rate of
the Fund will be between 100-250%. Generally, holding
periods in bull markets are expected to be longer than in
bear markets. High turnover involves correspondingly
greater brokerage commissions which the Fund must pay. A
high turnover rate may have tax consequences for
shareholders, due to the realization of capital gains or
losses by the Fund. See "Dividends, Distributions and Tax
Status".
INVESTMENT RESTRICTIONS
The Fund will not purchase securities on margin and
will not sell any security short or engage in the purchase
of call, put and other options or trading in other
derivatives. The Fund will not purchase or deal in
commodities, real estate or non-financial assets.
The Fund cannot borrow money except as a temporary
emergency measure and then not exceeding 10% of its total
assets. The Fund may not purchase additional securities
while borrowings exceed 5% of the value of its total assets.
HOW TO PURCHASE SHARES
Shares of the Fund may be purchased at net asset value
per share. Net asset value per share is calculated on every
business day at the close of trading on the New York Stock
Exchange. The Fund determines the net asset value per share
by subtracting the Fund's liabilities from the Fund's total
assets, dividing the remainder by the total number of shares
outstanding and adjusting the result to the nearest full
cent. The minimum initial investment is $500. The minimum
for each subsequent investment is $200. Shares may be also
purchased through an automatic investment plan from your bank
account. It has a minimum additional investment of only $100.
New investors who wish to purchase shares must fill
out the application form and mail it with their check or
money order to the Fund. The day after receipt, the Fund
will issue an "Account Statement" acknowledging the amount
invested and the number of shares purchased. Additional
shares may be purchased by written or telephone request.
Shares will be priced at the net asset value per share next
determined after the investor's check or telephone purchase
request is received. The maximum amount to be purchased by
telephone is limited to three times the market value of the
shares held in the shareholder's account. The Fund must
receive payment after a telephone purchase within three
business days. If payment is not received, the Fund will
redeem sufficient additional shares from the shareholder's
account to reimburse the Fund for such loss. A confirmation
of the telephone purchase is not sent until payment is
received.
Purchase of Fund shares will be made in full and
fractional shares, computed to third decimal places, unless
the investor specifies full shares. Full shares may be
purchased only by telephone. The Fund reserves the right to
reject purchase orders when, in the judgment of management,
such rejection is in the best interest of the Fund.
Investors may also arrange to purchase shares of
the Fund through financial planners or broker-dealers. Such
financial planners or broker-dealers may charge investors a
service fee for the service provided; bearing in mind that
the investor could have acquired the Fund's shares directly
without payment of any fee. No part of any service fee will
be received by the Fund.
"NO-FEE" RETIREMENT AND OTHER SPECIAL ACCOUNTS
Volumetric Fund offers a variety of "no-fee"
retirement accounts for individuals (IRAs), corporations
(pension plans) and the self-employed (SEP, Keogh plans).
Prototype forms of Self-Directed IRA, Roth IRA and
Simplified Employee Pension Plans (SEP) are available from
the Fund or from the brokerage firm of Investec Ernst & Co.
(One Battery Park Plaza, New York, NY 10004).To open a self-
directed retirement account, you will also have to open a
brokerage account at Ernst & Co. which represents the
Trustee, Delaware Charter Guarantee and Trust Company, for
your IRA transactions. To obtain an IRA application form or
more information about retirement accounts please contact
the Fund.
If you transfer to or invest in an IRA, Roth IRA or
SEP account of Volumetric Fund, the usual set-up fee ($25)
and annual fee ($45) charged by the Trustee will be
partially or fully waived and paid for you by Volumetric
Advisers, Inc. according to the following schedule:
Value of Your Account Set-up Fee Annual Fee
$2,000 or more None None
Less than $2,000 None $20
The Fund has an Automatic Investment Plan ("AIP")
available for shareholders who wish invest electronically
through their bank. The minimum additional investment for
this plan is $100. Monthly, bi-monthly and quarterly
payments are available. Please contact the fund for an AIP
application form.
The Fund also offers College Investment Plan ("CIP") and
Beneficiary ("BA") accounts. The CIP is a long-term
accumulation account with the objective to meet a minor's
projected college expenses. There are lump sum, monthly,
quarterly and annual payment options. The Beneficiary
Account is similar to a revocable trust. It is the same as a
regular account, except it will be automatically transferred
to the designated beneficiary, in case of death. The
beneficiary may be a person, such as a relative or friend,
or a charitable organization. Please contact the Fund for
additional details on BA and CIP accounts.
HOW TO REDEEM SHARES
Shares of the Fund may be partially or fully
redeemed any time at their net asset value next determined
after a written request is received. Telephone redemption
requests will be also accepted but only after verification
of ownership and is available only to individual
shareholders. Joint, custodian, corporate, trust and
institutional redemption requests must be made in writing.
Redemption payments are made no later than the third
business day after the effective date for redemption. Under
the Investment Company Act of 1940, the Fund may suspend the
right of redemption or postpone the date of payment for more
than three days when: (a) the New York Stock Exchange is
closed, (b) when trading on the New York Stock Exchange is
restricted, (c) when an emergency exists which makes it
impractical for the Fund to either dispose of securities or
make a fair determination of net asset value. There is no
assurance that the net asset value received upon redemption
will be greater than that paid by a shareholder upon
purchase.
The Fund expects to make all redemptions in cash. For those
shareholdersfor which it is applicable, the Fund reserves
the right to honor any request for redemption by making
payment in whole or in part in readily marketable securities
from the Fund's porfolio. These securites would be valued
the same way the securities are valued in calculating the net
asset value of the Fund. The Fund is governed by Rule 18f-1
under the Investment Company Act of 1940. Therefore, the
Fund is obligated to redeem shares, with respect to one
shareholder during any 90-day period, solely in cash up to
the lesser of the $250,000 or 1% of the net asset value of
the Fund at the beginning period.
SHAREHOLDER SERVICES
Shareholders receive the following services and statements
from the Fund:
* Detailed account statement every time shares are
purchased or redeemed.
* Quarterly reports showing the Fund's portfolio and
performance.
* Semi-annual account statements showing the value of the
shareholder's account semi-annually.
* Latest quotes, account or general information. Contact
the Fund by calling (914) 623-7637 or (800) 541-FUND, or
visit our web site.
* Volumetric Fund web site: www.volumetric.com
DIVIDENDS, DISTRIBUTIONS AND TAX STATUS
The Fund intends to qualify annually as a "regulated
investment company" under the Internal Revenue Code.
Qualified investment companies, such as most mutual funds,
are exempt from Federal income taxes. In order to qualify
as a "regulated investment company" the Fund will distribute
annually to its shareholders substantially all of its net
investment income and net capital gains in the form of
dividends and capital gain distributions.
Whether received in shares or cash, dividends paid by
the Fund from net investment income or distributions from
short-term net capital gains are taxable to shareholders as
ordinary income. Distributions of capital gains are taxable
to shareholders as such, regardless of the length of time
Fund shares have been owned by the shareholder. The Fund
declares dividends and capital gain distributions to
shareholders of record annually, in December, and pays the
dividends and distributions before January 15 of the next
year. A shareholder will be treated for tax purposes as
having received the dividend in December when it was
declared and not in January when it is paid; Dividends and
capital gain distributions may be subject to state and local
laws. Shareholders are urged to consult with their own tax
advisors for further information.
MANAGEMENT
The Fund's investments and other activities are
managed by Volumetric Advisers, Inc., 87 Violet Drive, Pearl
River, New York 10965 (the "Adviser"), and the officers of
the Fund. The Fund's Adviser and its officers are subject
to the supervision and control of the Board of Directors.
The Adviser has acted as adviser since the Fund's inception.
Pursuant to an Investment Advisory Agreement
approved by the Board of Directors on May 26, 1999, the
Adviser, in addition to providing investment advice, pays
all expenses of the Fund. These include: salaries of
personnel, research, data processing, printing, postage,
clerical, administrative, advertising and marketing
expenses. Furthermore, the Adviser also pays the Fund's
custodian fees, state registration fees and franchise taxes,
legal and auditing fees, and all other operating expenses,
such as shareholder's reports and proxy statement. The
Adviser also acts as the Fund's Transfer Agent. The Adviser
does not pay the Fund's brokerage commissions. The Adviser
shall not pay those expenses of the Fund which are related
to litigation against the Fund, if any; or if the Fund is
required to pay income taxes or penalties associated with
those taxes.
As compensation for all the above services, the
Adviser receives from the Fund a fee, payable monthly,
at the annual rate of 2% of the average daily net assets of
the Fund on the first $10 million of the average daily net
assets, 1.90% of such net assets from $10 million to $25
million, 1.80% of such net assets from $25 to $50 million,
1.70% of such net assets from $50 to $100 million, and 1.50%
of such assets over $100 million. Although this fee is
higher than that paid by most mutual funds, most funds also
pay various other such expenses, such as custodian,
registration, legal, auditing and transfer agent fees, plus
expenses of shareholder's reports. At Volumetric Fund all
expenses are paid directly by the Adviser. It should also
be noted that unlike many other funds, the Fund does not
have any sales and redemption charges for shareholders or
certain "hidden" charges associated with distribution or
marketing of the fund (12b-1 fees). Mr. Gabriel J. Gibs,
President of the Adviser, is considered a "controlling
person" of the Adviser, as defined by the Investment Company
Act of 1940.
OFFICERS AND DIRECTORS
The officers of the Fund manage its day-to-day
operations. The officers are subject to the supervision and
control of the Board of Directors. Board members are
elected at the Fund's annual meeting, usually held in May.
Directors and officers, and their principal occupations as
of January 31, 2000, are listed below.
WILLIAM P. BEHRENS, Director (since 1987)
CEO of Investec Ernst & Company, a member firm of New York,
American and other principal stock exchanges.
JEFFREY J. CASTALDO, Director (since 1994)
Executive Director, Capelli Associates, a commercial real
estate development and management company.
RICHARD C. FRIEDENBERG, Director (since 1996)
President, Twenty First Century Group, direct marketing
consultants.
GABRIEL J. GIBS, Founder, President, Portfolio
Manager, and Chairman (since 1978)
President of Volumetric Advisers Inc., the Fund's investment
adviser.
JEFFREY M. GIBS, Senior Vice President (since 1997)
Vice President of Volumetric Advisers, Inc.
ANNA KARPATI, Director (since 1997)
Executive Secretary. Board of Education, River Vale, New
Jersey.
WAYNE W. MOSHIER, Director (since 1998)
Retired in 1994. Formerly President of SST Corporation, a
pharmaceutical and chemical products company.
MARCEL A. OLBRECHT, Director (since 1998)
Director of Manufacturing, Allied Signal, Specialty Chemicals
Division.
STEPHEN J. SAMITT, Director (since 1996)
Partner, CPA, Briggs Bunting & Dougherty, LLP, Certified
Public Accountants.
DAVID L. SEIDENBERG, Treasurer and Director (since
1983)
Vice President, Davos Chemical Company.
RAYMOND W. SHERIDAN, Vice President, Director (since
1995)
Owner, Sheridan Associates, insurance and real estate
brokers.
IRENE J. ZAWITKOWSKI, Executive Vice President,
Secretary and Director (since 1978)
Assistant Portfolio Manager of the Fund. Executive Vice
President of Volumetric Advisers, Inc.
CAPITAL STOCK
The Fund is authorized to issue 2,000,000 shares of
Common Stock with a par value of $.01 per share. Each share
has one vote and all shares participate equally in dividends
and other distributions by the Fund. Fractional shares have
the same rights proportionately as do full shares.
Shareholders are entitled to redeem their shares as set
forth under "How to Redeem Shares".
The Fund's Board of Directors may authorize the
issuance of additional shares of common stock, if demand for
the Fund's shares surpasses currently authorized shares.
CUSTODIAN, TRUSTEE AND AUDITOR
The Chase Manhattan Bank N.A., ("Chase"), 1211
Avenue of Americas, New York, NY 10036, acts as the
Custodian of the Fund's securities. Chase does not have any
part in determining the investment policies of the Fund or
which securities are to be purchased or sold.
Delaware Charter Guarantee & Trust Company, P.O. Box
8963, Wilmington, DE 19899, through a brokerage account at
Investec Ernst & Company, One Battery Park Plaza, New York,
NY 10004, acts as the Trustee for the Fund's self-directed
IRA and SEP accounts.
The firm of Feuer & Orlando, Pye & Co., L.L.P., 220 Fifth
Avenue, New York, NY 10001, acts as the Fund's independent
certified public accountants.
GENERAL INFORMATION
Volumetric Fund is on NASDAQ's mutual fund listing
with the ticker symbol of VOLMX. The Fund's daily net asset
value (NAV) is published nationwide in the mutual fund
section of major newspapers or may be accessed through on-
line services including the Fund's web site:
www.volumetric.com. The Fund may be contacted by E-mail via
[email protected].
February 25, 2000
PART B
STATEMENT OF ADDITIONAL INFORMATION
VOLUMETRIC FUND, INC.
This Statement of Additional Information is not a
prospectus. It should be read in conjunction with the
Fund's Prospectus, a copy of which may be obtained by
writing Volumetric Fund, 87 Violet Drive, Pearl River, New
York 10965 or calling (914) 623-7637.
This Statement of Additional Information relates to the
Fund's Prospectus, dated February 25, 2000.
TABLE OF CONTENTS
History and General Information.......................2
Investment Objective and Approach.....................2
Investment Restrictions...............................3
Management of the Fund................................4
Control Persons and Principal Holders of Securities. 6
Investment Advisory Services..........................6
Brokerage Allocation..................................7
Purchase, Redemption and Pricing of Securities........7
Calculation of Performance Data.......................8
Financial Statements..................................8
HISTORY AND GENERAL INFORMATION
Volumetric Fund, Inc. -- formerly named The Volumetric
Investment Society -- was founded in August of 1978 by Mr.
Gabriel J. Gibs, as a private investment partnership for his
friends, relatives and associates. At that time he had
worked as a chemist for Lonza, Inc., a large multinational
chemical firm, where some of his associates encouraged him
to start the fund. The Fund started its operations on
September 1, 1978 with 19 charter shareholders and with net
assets of $17,712 and an initial offering price of $10.00
per share.
The Fund's name was changed from the Volumetric
Investment Society to Volumetric Fund on June 15, 1986. The
Annual Meeting of shareholders approved the reorganization
of the Fund into a New York corporation on July 24, 1986.
Additional history and general information about the Fund
is described in the Prospectus.
INVESTMENT OBJECTIVE AND APPROACH
The Fund's investment objective is capital growth. The
Fund's investment approach is described in the appropriate
section of the Prospectus. In the following, some
additional details of the Fund's investment approach is
provided.
The Fund's investment decisions, buying and selling of
common stocks, are made with the utilization of volume
analysis, specifically the Fund's proprietary Volumetric
Trading System. This is a technical system, based on the
analysis of stocks and the market's trading volume and in
which fundamental aspects are of only minor significance.
INVESTMENT RESTRICTIONS
(1) The Fund will not purchase securities on margin.
(2) The Fund will not sell any security short or engage
in the purchase of call, put or other options.
(3) The Fund will not invest more than 5% of its assets
in the securities of any one issuer -- except securities
based on stock market indices or United States government
securities -- or more than 25% of its assets in any single
industry.
(4) The Fund will not purchase more than 5% of any
class of securities of any one issuer or invest for the
purpose of exercising control of the issuer's management.
(5) The Fund will not invest more than 5% of its total
assets in the securities of other investment companies or
purchase more than 3% of any other investment company's
securities.
(6) The Fund cannot borrow money except as a temporary
emergency measure and not exceeding 10% of its total assets.
The Fund may not purchase additional securities while
borrowings exceed 5% of the value of its total assets.
(7) The Fund will not make loans.
(8) The Fund will not underwrite securities of other
issuers, except when purchasing or selling portfolio
securities.
(9) The Fund will not issue senior securities.
(10) The Fund will not invest in securities for which
there exists no readily available market or for which there
are legal or contractual restrictions on resale.
(11) The Fund will not purchase or deal in commodities,
real estate or non-financial assets.
These investment restrictions may not be changed without
the approval by a vote of a majority of the Fund's
outstanding voting securities. Under the Investment Company
Act of 1940, such approval requires the affirmative vote, at
the meeting of shareholders, of the lesser of (a) more than
50% of the Fund's outstanding shares, or (b) at least 67% of
shares present or represented at the meeting, provided that
the holders of more than 50% of the Fund's outstanding
shares are present in person or represented by proxy.
MANAGEMENT OF THE FUND
The everyday operation of the Fund is managed by the
Fund's Adviser and its officers. All current officers are
also directors. Major policy decisions of the Fund must be
approved by the Board. The number of directors is currently
set at 11. Any change in the number of directors must be
approved by the Board.
The directors and officers of the Fund, their addresses
and principal occupations are listed below.
* William P. Behrens, Director
Investec Ernst & Co, 1 Battery Park Plaza, New York, NY 10004
Cheif Executive Officer, Investec Ernst & Co., a member
firm of New York and American Stock Exchanges since 1975.
American Stock Exchange Official. Investec Ernst & Co. and
Volumetric Advisers, Inc. have a Distribution Agreement
for the Fund's shares.
Jeffrey J. Castaldo, Director
1901 Regent Drive, Mount Kisco, NY 10549
Executive Director, Capelli Associates, a commercial real
estate development and management company since 1989.
Richard C. Friedenberg, Director
11 Sterling Road, Chestnut Ridge, NY 10977
President, Twenty First Century Group, direct marketing
consultants.
* Gabriel J. Gibs, President, Portfolio Manager, Chairman of
the Board
87 Violet Drive, Pearl River, New York 10965
President of Volumetric Advisers, Inc., the Fund's
Adviser, since 1983. Between 1974 and 1983 he was also
the President of his own SEC registered investment advisory
firm, a sole proprietorship, and the predecessor firm for
Volumetric Advisers, Inc.
*Jeffrey M. Gibs, Senior Vice President
1007 Willow Avenue, Hoboken, NJ 07030
Vice President of Volumetric Advisers, Inc. since 1997.
Between 1995 and 1997 he was Senior Portfolio Administrator
of Van Eck Associates. From 1989 to 1995 he was employed
by Chase Manhattan Bank as Assistant Treasurer and in other
capacities.
Anna Karpati, Director (effective May 21, 1997)
28 Summit Avenue, Hackensack, NJ 07601
Executive Secretary, River Vale, NJ, Board of Education
Wayne W. Moshier, Director
2 Stokes Farm Road, Old Tappan, NJ 07675
Retired in 1994. Formerly, President of SST Corporation, a
pharmaceutical and fine chemical products company.
Marcel A. Olbrecht, Director
76 Chuckanutt Drive, Oakland, NJ 07436
Director of Manufacturing, Allied Signal, Specialty Chemicals
Divisions, since 1998. Previously, Vice President of Lonza,
Inc., an international chemical manufacter.
Stephen J. Samitt, Director
2 Ridge Drive North, Montville, NJ 07045
Partner, Briggs Bunting & Dougherty, LLP, Certfiied
Public Accountants since 1997. Previously at Tait, Weller
& Baker, a full service accounting firm.
David L. Seidenberg, Treasurer, Director
29 Shaw Road, Woodcliff Lake, NJ 07605
Vice President, Davos Chemical Company, since 1972.
Reymond W. Sheridan, Director
1 Parker Road, Blauvelt, NY 10913
Partner, Sheridan Associates, insurance and real estate
brokers.
*Irene J. Zawitkowski, Executive Vice President, Secretary,
Assistant Portfolio Manager, Director
647 Athlone Terrace, River Vale, New Jersey 07675
Executive Vice President and CFO of Volumetric Advisers,
Inc.
*Interested person within the definition set forth in
Section 2(a)(19) of the Investment Company Act of
1940.
Directors do not receive any compensation other than a
$100 fee per board meeting which is paid by the Fund's
Adviser. Officers are employees of the Adviser and are not
being paid by the Fund.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
Gabriel Gibs, President of the Fund's Adviser is
considered the "controlling person" of the Adviser, and
therefore, that of the Fund.
No shareholder owned beneficially more than 5% of the
Fund's shares, as of January 31, 2000.
INVESTMENT ADVISORY SERVICES
Volumetric Advisers, Inc., until August of 1986 named
Volumetric, Inc., is the Investment Adviser of the Fund, (
87 Violet Drive, Pearl River, New York, 10965), pursuant to
an Investment Advisory Agreement dated May 26, 1999. It is
registered with the Securities and Exchange Commission
pursuant to the Investment Advisers Act of 1940. Gabriel J.
Gibs is the controlling person of the Adviser. Mr. Gibs has
been managing discretionary investment accounts for
individuals since 1974. His sole proprietorship business
was incorporated in New York in 1983 as Volumetric, Inc.
Gabriel J. Gibs is President of both the Fund and the
Adviser. Irene J. Zawitkowski is Executive Vice President
of the both the Fund and of the Adviser.
The fee received by the Adviser is described in detail in
the Prospectus. The Investment Adviser's fee will be
reduced for any fiscal year by any amount necessary to
prevent Fund expenses (exclusive of interest, taxes,
brokerage commissions and extraordinary expenses) from
exceeding the most restrictive expense limitations imposed
by the securities laws or regulations of those states or
jurisdictions in which the Fund's shares registered or
qualified for sale. Currently this expense limitation is
2%. The daily management fee is calculated each day and
deducted from total assets, as an accrued expense, to obtain
net assets. The management fee is paid out to the Adviser,
monthly. The daily management fee is determined by
multiplying the Fund's net assets by 0.02 (current rate) and
divide the resulting number by 365.
Management fees paid by the Fund to the Adviser for the
past three years were as follows:
1999 $ 386,094
1998 $ 383,174
1997 $ 317,249
The Agreement was approved by the Board of Directors
(including the affirmative vote of all Directors who were
not parties to the Agreement or interested persons of any
such party) on May 26, 1999. The Agreement may be
terminated without penalty on 60 days written notice by a
vote of the majority of the Fund's Board of Directors or by
the Adviser, or by holders of a majority of the Fund's
outstanding shares. The Agreement will be submitted to the
first meeting of the Fund's shareholders, and if approved at
the meeting will continue for two years and from year-to-
year thereafter provided it is approved, at least annually,
in the manner stipulated in the Investment Company Act of
1940. This requires that the Agreement and any renewal be
approved by a vote of the majority of the Fund's directors
who are not parties there to or interested persons of any
such party, cast in person at a meeting specifically called
for the purpose of voting on such approval.
BROKERAGE ALLOCATION
To minimize brokerage commissions the Fund uses
predominantly the services of discount brokers and full-
service brokers whose negotiated rates are competitive with
those of discount brokers. Brokers are selected based on
their fees, services, execution capability, and reputation.
The Fund is not obtaining research services from any broker.
William P. Behrens, a director of the Fund, is CEO of Investec
Ernst & Co., a New York Stock Exchange Member firm, which
acts also as one of the brokers of the Fund.
The aggregate commissions paid by the Fund to brokers for
the three previous calendar years are indicated below:
1999 $65,432
1998 $57,307
1997 $54,987
PURCHASE, REDEMPTION AND PRICING OF SECURITIES
The Fund is a no-load fund. It is offering and redeeming
its shares at net asset value, as described in detail in the
Prospectus.
Net asset value per share is calculated daily, except on
Saturdays, Sundays and holidays, as soon as the closing
prices of the New York Stock Exchange become available,
currently at 4 P.M. On holidays, when the New York Stock
Exchange is closed, the Fund does not calculate its net
asset value per share. These days are: New Year's Day, Dr.
Martin Luther King's Day, President's Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day.
CALCULATION OF PERFORMANCE DATA
The performance of the Fund is expressed as total return.
Total return is the change in value of an investment in a
fund over a particular period, assuming that all
distributions have been reinvested. Thus, total return
reflects dividend income, capital gain distributions and
variations in share prices at the beginning and end of a
period.
The Fund's average annual total returns for periods of 1,
5 and 10 years, from the beginning of the Fund's first full
year, January 1, 1979, are shown below. The average annual
total return is calculated by summing up annual returns and
dividing the sum by the number of years used. The SEC
standardized is a compounded return, per instruction in Item
22 (b) (1) (A).
Average Annual Total Returns, Period Ending 12/31/99
Return 1 Year 5 Year 10 Year Since 12/31/78
Average Annual Total+ 5.19% +14.40% +11.24% +14.02%
SEC Standardized + 5.19% +13.25% +10.21% +12.87%
(compounded)
FINANCIAL STATEMENTS
The Fund's 1999 Annual Report, dated February 9, 2000,
containing the audited financial statements for year ending
1999, notes to financial statements, and the Opinion of
Feuer & Orlando, Pye & Co., L.L.P, is being filed with the
Securities and Exchange Commission and is hereby
incorporated by reference into this Statement of Additional
Information. A copy of the Fund's 1999 Annual Report is
available free of charge upon request.
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
In Prospectus: Financial Highlights
In SAI: Other financial statements have been
incorporated by reference into the Fund's 1999 Annual Report
(b) Exhibits (exhibits are attached are numbered to
correspond to items below:
*(1) Certificate of Incorporation of Volumetric
Fund, Inc.
*(2) By-Laws of Volumetric Fund, Inc.
(3) None
*(4) Specimen certificate for shares of Common
Stock of Registrant
*(5) Amended Investment Advisory Agreement between
Registrant and Volumetric Advisers, Inc.
(6) None
(7) None
*(8) Custodian Agreement between Registrant and
Chase Manhattan Bank, N.A.
(9) None
(10) None
(11) Consent of independent accountants for the
Registrant.
(12) None
(13) None
(14) None
(15) None
* Previously filed
Item 25 Persons Controlled by or Under Common Control with
Registrant
None
Item 26 Number of Holders of Securities
Title of Class Number of Record Holders
Common, $0.01 par value 1175 (as of December 31, 1999)
Item 27 Indemnification
Insofar as indemnification for liability arising under
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant
to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant for expenses incurred or paid by a director,
officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
Item 28 Business and Other Connection of Investment Adviser
None
Item 29 Principal Underwriters
None
Item 30 Location of Accounts and Records
Volumetric Advisers, Inc. maintains all records at the
office of the Registrant at 87 Violet Drive, Pearl
River, NY 10965.
Item 31 Management Services
None
Item 32 Undertakings
None
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940 the Registrant certifies that
it meets all of the requirements for the effectiveness of this
Registration Statement pursuant to Rule 485(b) under the Securitities
Act of 1933 and has duly caused this Registration Statement to
be signed on its behalf by the undersigned, thereto fully
autorized, in the Town of Orangetown, and State of New York on
25th Day of February 2000.
Volumetric Fund, Inc.
Registrant
By:____ /s/ Gabriel J. Gibs ______
Gabriel J. Gibs, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following
persons in the capacities and on the date indicated.
/s/ Gabriel J. Gibs
_________________________
Gabriel J. Gibs, President, Chairman of the Board 2/25/00
/s/ Irene J. Zawitkowski
________________________
Irene J. Zawitkowski Executive Vice President, Director 2/25/00
________________________
William P. Behrens Director
________________________
Jeffrey J. Castaldo Director
/s/ Richard C. Friedenberg
_______________________
Richard C. Friedenberg Director 2/25/00
/s/ Anna Karpati
_______________________
Anna Karpati Director 2/25/00
______________________
Wayne W. Moshier Director
______________________
Marcel A. Olbrecht Director
______________________
Stephen J. Samitt Director
______________________
David L. Seidenberg Treasuer, Director
/s/ Raymond W. Sheridan
______________________
Raymond W. Sheridan Vice President, Director 2/25/00
FEUER, ORLANDO, PYE & CO.
Certified Public Accountants, LLP
(A Partnership Including A Professional Corporation)
February 9, 2000
Mr. Gabriel Gibs
Volumetric Fund, Inc.
87 Violet Drive
Pearl River, New York 10965
Dear Mr. Gibs,
Please be advised that we hereby consent to the use of our
audit opinion dated February 8, 2000, for use in the Fund's
post effective Amendment No. 18. on Form N-1A which filing updates
the registration statement filed under the Securities Act of
1933. The above mentioned audit opinion being that which appeared
in the Fund's Annual Report for the year ended December 31, 1999.
/s/ Feuer, Orlando, Pye & Company
Feuer, Orlando, Pye, & Company
