Scudder Short Term Global Income Fund
Supplement to Prospectus
dated March 1, 1995
The following text replaces the section entitled "Shareholder benefits--A
team approach to investing."
Scudder Short Term Global Income Fund is managed by a team of Scudder
investment professionals who each play an important role in the Fund's
management process. Team members work together to develop investment
strategies and select securities for the Fund's portfolio. They are
supported by Scudder's large staff of economists, research analysts,
traders and other investment specialists who work in Scudder's offices
across the United States and abroad. Scudder believes its team approach
benefits Fund investors by bringing together many disciplines and
leveraging Scudder's extensive resources.
Lead Portfolio Manager Margaret R. Craddock has set the Fund's investment
strategy and overseen its daily operation since she joined Scudder in 1991.
Ms. Craddock has seven years of experience in global fixed-income research
and investing. Gary P. Johnson, Portfolio Manager, concentrates on the
Fund's hedging strategies and research, a role he has filled since the Fund
commenced operations. Mr. Johnson joined Scudder in 1987 and has worked
with quantitative analysis and strategic trading since 1982. Adam M.
Greshin, Portfolio Manager, joined Scudder in 1986 as an international bond
analyst and is Product Leader for Scudder's global and international fixed
income investing. Mr. Greshin will be involved in both managing the Fund
and setting investment strategies.
March 27, 1995
<PAGE>
March 27, 1995
Dear Scudder Investor,
The prospectus supplement on the reverse side is to inform you that
Lawrence Teitelbaum, formerly a Portfolio Manager of Scudder Short Term
Global Income Fund, has left Scudder, Stevens & Clark, Inc. We thank Mr.
Teitelbaum for his contributions to the Fund and wish him well.
We welcome Adam M. Greshin, who rejoins the Fund as a Portfolio
Manager. Mr. Greshin was involved in the original design of the Fund and
was a member of the Fund's portfolio management team from 1991 to 1993.
If you have any questions, please call us at 1-800-225-2470, between 8
a.m. and 6 p.m. eastern time, Monday through Friday. We will be happy to
assist you.
Sincerely,
/s/David S. Lee
David S. Lee
President, Scudder Investor Services, Inc.
This letter is for explanatory purposes and is not part of the prospectus
supplement on the reverse side.
(over please)
<PAGE>
This prospectus sets forth concisely the information about Scudder Short
Term Global Income Fund, a series of Scudder Global Fund, Inc., an open-end
management investment company, that a prospective investor should know
before investing. Please retain it for future reference.
If you require more detailed information, a Statement of Additional
Information dated March 1, 1995, as amended from time to time, may be
obtained without charge by writing Scudder Investor Services, Inc., Two
International Place, Boston, MA 02110-4103 or calling 1-800-225-2470. The
Statement, which is incorporated by reference into this prospectus, has
been filed with the Securities and Exchange Commission.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
Contents--see page 4.
Scudder Short Term Global Income Fund
Prospectus
March 1, 1995
A pure no-load(tm) (no sales charges) mutual fund series which seeks high
current income by investing primarily in high-grade money market
instruments and short-term bonds denominated in foreign currencies and the
U.S. dollar.
Expense information
How to compare a Scudder pure no-load(tm) fund
This information is designed to help you understand the various costs and
expenses of investing in Scudder Short Term Global Income Fund (the
"Fund"). By reviewing this table and those in other mutual funds'
prospectuses, you can compare the Fund's fees and expenses with those of
other funds. With Scudder's pure no-load(tm) funds, you pay no commissions
to purchase or redeem shares, or to exchange from one fund to another. As a
result, all of your investment goes to work for you.
1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.
Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE
2) Annual Fund operating expenses (after expense maintenance): Expenses
paid by the Fund before it distribute d its net investment
income, expressed as a percentage of the Fund's average daily net
assets for the fiscal year ended October 31, 1994.
Investment management fee 0.60%
12b-1 fees NONE
Other expenses 0.40%**
-----
Total Fund operating expenses 1.00%**
=====
Example
Based on the level of total Fund operating expenses listed above, the total
expenses relating to a $1,000 investment, assuming a 5% annual return and
redemption at the end of each period, are listed below. Investors do not
pay these expenses directly; they are paid by the Fund before it
distributes its net investment income to shareholders. (As noted above, the
Fund has no redemption fees of any kind.)
1 Year 3 Years 5 Years 10 Years
$10 $32 $55 $122
See "Fund organization--Investment adviser" for further information about
the investment management fee. This example assumes reinvestment of all
dividends and distributions and that the percentage amounts listed under
"Annual Fund operating expenses" remain the same each year. This example
should not be considered a representation of past or future expenses or
return. Actual Fund expenses and return vary from year to year and may be
higher or lower than those shown.
* You may redeem by writing or calling the Fund. If you wish to receive
your redemption proceeds via wire, there is a $5 wire service fee. For
additional information, please refer to "Transaction
Information--Redeeming Shares."
** Until February 29, 1996 , the Adviser has agreed to maintain the
total annualized expenses of the Fund at not more than 1.00% of
average daily net assets . If the Adviser had not agreed
to maintain the Fund's expenses, the total annualized expenses of the
Fund would have been 1.15% (of which 0.75% would have consisted of
investment management fees) for the fiscal year ended October 31,
1994.
Financial highlights
The following table includes selected data for a share outstanding
throughout each period and other performance information derived from the
audited financial statements.
If you would like more detailed information concerning the Fund's
performance, a complete portfolio listing and audited financial statements
are available in the Fund's Annual Report dated October 31, 1994 and may be
obtained without charge by writing or calling Scudder Investor Services,
Inc.
<TABLE>
<CAPTION> FOR THE PERIOD
MARCH 1, 1991
(COMMENCEMENT
YEARS ENDED OCTOBER 31, OF OPERATIONS)
---------------------------------------------- TO OCTOBER 31,
1994 1993 1992 1991
---------------------------------------------- --------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period . . . . . . . . . . $11.68 $11.84 $12.01 $12.00
------ ------ ------ ------
Income from investment operations:
Net investment income (a) . . . . . . . . . . . . . . . .87 .95 1.08 .76
Net realized and unrealized gain (loss) on investment
transactions . . . . . . . . . . . . . . . . . . . . . (.90) (.14) (.17) .01
------ ------ ------ ------
Total from investment operations . . . . . . . . . . . . (.03) .81 .91 .77
------ ------ ------ ------
Less distributions from:
Net investment income . . . . . . . . . . . . . . . . . (.02) (.95) (1.08) (.76)
Net realized gains on investments . . . . . . . . . . . -- (.02) -- --
Tax return of capital distribution . . . . . . . . . . (.85) -- -- --
------ ------ ------ ------
Total distributions . . . . . . . . . . . . . . . . . . . (.87) (.97) (1.08) (.76)
------ ------ ------ ------
Net asset value, end of period . . . . . . . . . . . . . $10.78 $11.68 $11.84 $12.01
====== ====== ====== ======
TOTAL RETURN (%) . . . . . . . . . . . . . . . . . . . . (.25) 7.14 7.83 6.65**
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period ($ millions) . . . . . . . . . 560 1,041 1,369 205
Ratio of operating expenses, net to average daily
net assets (%) (a) . . . . . . . . . . . . . . . . . . 1.00 1.00 1.00 1.00*
Ratio of net investment income to average daily
net assets (%) . . . . . . . . . . . . . . . . . . . . 7.76 8.10 8.94 9.97*
Portfolio turnover rate (%) . . . . . . . . . . . . . . . 272.4 259.8 274.2 26.1*
(a) Reflects a per share amount of management fee not
imposed by the Adviser . . . . . . . . . . . . . . . $ .02 $ .01 $ .03 $ .06
Operating expense ratio including management fee and
other expenses not imposed (%) . . . . . . . . . . . 1.15 1.11 1.23 1.89*
<FN>
* Annualized
** Not annualized
</TABLE>
A message from Scudder's chairman
Scudder, Stevens & Clark, Inc., investment adviser to the Scudder Family of
Funds, was founded in 1919. We offered America's first no-load mutual fund
in 1928. Today, we manage in excess of $90 billion for many private
accounts and over 50 mutual fund portfolios. We manage the mutual funds in
a special program for the American Association of Retired Persons, as well
as the fund options available through Scudder Horizon Plan, a
tax-advantaged variable annuity. We also advise The Japan Fund and nine
closed-end funds that invest in countries around the world.
The Scudder Family of Funds is designed to make investing easy and less
costly. It includes money market, tax free, income and growth funds as well
as IRAs, 401(k)s, Keoghs and other retirement plans.
Services available to all shareholders include toll-free access to the
professional service representatives of Scudder Investor Relations, easy
exchange among funds, shareholder reports, informative newsletters and the
walk-in convenience of Scudder Funds Centers.
All Scudder mutual funds are pure no-load(tm). This means you pay no
commissions to purchase or redeem your shares or to exchange from one fund
to another. There are no "12b-1" fees either, which many other funds now
charge to support their marketing efforts. All of your investment goes to
work for you. We look forward to welcoming you as a shareholder.
/s/Daniel Pierce
Scudder Short Term Global Income Fund
Investment objective
* high current income by investing primarily in high-grade money market
instruments and short-term bonds denominated in foreign currencies and
the U.S. dollar
Investment characteristics
* active management of currency risk to help reduce share price
volatility
* global investments primarily in government and other high-grade
securities
Contents
Investment objective and policies 5
Investments 5
Global investment opportunities 6
Why invest in the Fund? 7
International investment experience 7
Special risk considerations 8
Additional information about policies and investments 9
Purchases 12
Exchanges and redemptions 13
Distribution and performance information 15
Fund organization 16
Transaction information 17
Shareholder benefits 19
Directors and Officers 22
Investment products and services 23
How to contact Scudder Back cover
Investment objective and policies
Scudder Short Term Global Income Fund (the "Fund"), a
non-diversified series of Scudder Global Fund, Inc., provides
investors with easy, low-cost access to short-term debt securities issued
throughout the world. The Fund's objective is to provide high current
income by investing primarily in high-grade money market instruments and
short-term bonds denominated in foreign currencies and the U.S. dollar.
The Fund invests primarily in individual debt obligations which have an
effective maturity or, an expected average life not exceeding three years.
Average life is a measure of the effective maturity of certain securities
held in the Fund's portfolio. The dollar-weighted effective average
maturity of the portfolio will not exceed three years. Within this
limitation, the Fund may invest in individual securities with remaining
stated maturities of more than three years. The Fund's price and yield will
fluctuate, primarily due to movement of foreign currencies against the U.S.
dollar and changes in interest rates. To the extent the Fund invests in
high-grade securities, it will be unable to avail itself of opportunities
for higher income which may be available with lower grade investments. The
Fund is not meant to be a substitute for a fixed-price money market fund.
Except as otherwise indicated, the Fund's investment objective and policies
are not fundamental and may be changed without a vote of shareholders.
Shareholders will receive written notice of any changes in the Fund's
objective. If there is a change in investment objective, shareholders
should consider whether the Fund remains an appropriate investment in light
of their then current financial position and needs. There can be no
assurance that the Fund's objective will be met.
Currency risk
It is anticipated that, under normal conditions, the Fund will provide a
higher level of income than domestic money market and short-term bond
investments due to the Fund's participation in higher yielding debt markets
outside of the United States. Since the Fund invests significantly in
securities denominated in foreign currencies, however, movements in foreign
currency exchange rates versus the U.S. dollar are likely to increase the
Fund's price variability relative to domestic short-term income funds.
Fluctuations in foreign currencies can have a positive or negative impact
on returns. Normally, to the extent that the Fund is invested in foreign
securities, a weakening in the U.S. dollar relative to the foreign
currencies underlying the Fund's investments should help increase the net
asset value of the Fund. Conversely, a strengthening in the U.S. dollar
versus the foreign currencies in which the Fund invests should have a
downward effect on the net asset value of the Fund. The Fund's
investment adviser, Scudder, Stevens & Clark, Inc. (the "Adviser"),
will attempt to reduce exchange rate risk through active portfolio
management, including currency hedging activities and efforts to identify
bond markets with strong or stable currencies, but it cannot completely
eliminate the impact of currency fluctuations on the investment returns of
the Fund.
Investments
As a global investment, the Fund will typically invest in a variety of
high-grade domestic and foreign short-term debt securities. In addition to
U.S. dollar holdings, the Fund may invest in bonds denominated in foreign
currencies including, but not limited to, the Australian Dollar, British
Pound Sterling, Canadian Dollar, Swedish Krona, Danish Krone, and New
Zealand Dollar, as well as the Austrian Schilling, Dutch Guilder, Japanese
Yen, French Franc, Mexican Peso, Spanish Peseta, Swiss Franc,
Fin n ish Markka, Irish Punt, Belgian Franc, Italian Lira and German
Mark. In addition, the Fund may invest in securities denominated in
multi-national currency units, such as the European Currency Unit (ECU).
The currency of a given security may be different than the currency of the
country where the security's issuer is domiciled. Although the Fund is
considered "non-diversified" for purposes of the Investment Company Act of
1940 (the "1940 Act"), it will invest in debt securities of issuers from a
minimum of three different countries. To limit fluctuation in the Fund's
net asset value, the Fund will invest a minimum of 25% of its total assets
in U.S. dollar-denominated securities, issued domestically or abroad. Under
certain circumstances, the Fund may invest substantially all of its assets
in U.S. debt securities, including short-term money market securities.
To further limit risk, at least 65% of the Fund's investments will consist
of securities rated within the three highest rating categories of Standard
and Poor's ("S&P") (AAA, AA, A) or Moody's Investors Service, Inc.
("Moody's") (Aaa, Aa or A) or, if not rated, will be considered by the
Adviser to be of equivalent quality in local currency terms. The Fund may
invest up to 10% of its net assets in debt securities rated lower than BBB
by S&P or Baa by Moody's, or unrated securities of equivalent quality as
determined by the Adviser. The Fund will not invest in any securities rated
B or lower. See "Risk factors" for more information.
In keeping with the Fund's high-grade emphasis, the Fund will invest
predominantly in U.S. and foreign government securities and money market
instruments. The Fund may invest in debt securities issued or guaranteed by
the U.S. government, its agencies or instrumentalities; obligations issued
or guaranteed by foreign national governments, their agencies,
instrumentalities or political subdivisions; and debt securities issued or
guaranteed by supranational organizations such as the European Investment
Bank, Inter-American Development Bank and The World Bank. The Fund may also
invest in non-government securities including corporate debt securities,
bank or bank holding company obligations (e.g., certificates of deposit and
banker acceptances), and mortgage and other asset-backed issues.
Unlike domestic money market funds, the Fund's price will fluctuate. The
Adviser, however, actively manages the Fund in an effort to reduce the
effect of currency fluctuations and other factors on the Fund's net asset
value. The Adviser will allocate the Fund's investments among those markets
and currencies which it believes offer the most attractive combination of
high income and principal stability. In evaluating investments for the
Fund, the Adviser will analyze relative yields and appreciation potential
of securities in particular markets; world interest rate and monetary
trends; economic, political and financial market conditions in different
countries; credit quality; and the relationship of individual foreign
currencies to the U.S. dollar. The Adviser relies on internally and
externally generated financial, economic, and credit research to evaluate
alternative investment opportunities. Aside from security selection, the
Fund may seek to hedge currency exposure through the use of strategic
transactions. See "Additional Information about policies and
investments--Strategic Transactions."
Global investment opportunities
Greater portfolio diversity
While Scudder Short Term Global Income Fund is non-diversified, an
investment in the Fund can help add diversity to an investor's portfolio of
U.S. dollar-denominated bonds, which can lead to reduced volatility over
time. This results because the income and capital returns on fixed income
securities denominated in foreign currencies often diverge from those
generated by similar securities denominated in U.S. dollars. The
performance of any country's short-term bond and cash markets will reflect
the unique characteristics of that country's economy, including its rate of
inflation, its need for capital, and the outlook for its currency.
Higher potential returns
A global income portfolio is able to take advantage of a far wider range of
investment opportunities than one that is restricted to U.S. dollar
securities and may, at times, provide higher investment returns. Foreign
currency denominated bond markets have recently grown faster than the U.S.
dollar-denominated bond market, and now represent more than 50% of the
market value of the world's bond markets. Also, access to foreign bond
markets has increased in recent years as certain countries have dismantled
exchange rate controls and reduced withholding taxes.
In addition, foreign short-term debt obligations frequently offer higher
yields than similar U.S. securities, and the prices of foreign instruments
can outperform those of U.S. securities. Inefficiencies in the foreign
exchange and global debt markets can create opportunities for higher
risk-adjusted rates of return. Fluctuations in foreign currencies relative
to the U.S. dollar can strongly influence investment returns, positively or
negatively. Foreign short-term debt obligations may from time to time offer
lower yields and returns than similar U.S. securities.
Why invest in the Fund?
Scudder Short Term Global Income Fund is designed for investors seeking
high current income from a portfolio of high-grade money market instruments
and short-term bonds denominated in foreign currencies and the U.S. dollar.
The Fund is appropriate for those investors who can tolerate short-term
currency swings and other risks associated with international investing in
return for the possibility of earning a higher total rate of return than
might be available from a short-term fixed income portfolio invested solely
in U.S. securities.
The Fund may also be attractive to investors seeking to enhance the current
income and balance of an established investment portfolio. It is expected
that, under normal conditions, the Fund will provide a higher level of
income than less risky domestic money market and short-term bond
investments. Moreover, the Fund will be managed with the goal of offering
more price stability than most long-term domestic and international bond
investments.
The Fund may provide investors with an easy, convenient and economical way
to participate in attractive short-term debt markets around the globe.
Individuals and smaller institutional investors often find it expensive and
impractical to buy and sell international bonds, hold securities in
safekeeping, and transact in foreign currencies.
In addition, the Fund offers all the benefits of the Scudder Family of
Funds. Scudder, Stevens & Clark, Inc. manages a diverse family of pure
no-load(tm) funds and provides a wide range of services to help investors
meet their investment needs. Please refer to "Investment products and
services" for additional information.
International investment experience
The Adviser has been a leader in international investment management and
trading for over 40 years. Its investment company clients include Scudder
International Fund, Inc., which was incorporated in Canada in 1953 as the
first foreign investment company registered with the United States
Securities and Exchange Commission, Scudder International Bond Fund, which
invests internationally, Scudder Global Fund and Scudder Global Small
Company Fund, which invest worldwide, The Japan Fund, Inc., which invests
in Japanese issuers, Scudder Latin America Fund, which invests in Latin
American issuers, Scudder Pacific Opportunities Fund, which invests in
Pacific Basin issuers, Scudder Emerging Markets Income Fund, which invests
in debt securities issued in emerging markets and Scudder Greater Europe
Growth Fund, which invests in equity securities of European companies. The
Adviser also manages the assets of eight closed-end investment companies
investing in foreign securities: The Argentina Fund, Inc., The Brazil Fund,
Inc., The First Iberian Fund, Inc., The Korea Fund, Inc., The Latin America
Dollar Income Fund, Inc., Scudder New Asia Fund, Inc., Scudder New Europe
Fund, Inc. and Scudder World Income Opportunities Fund, Inc.
Special risk considerations
The Fund is intended for investors who can accept the risks associated with
investing in fixed income securities denominated in foreign currencies.
Total return from investment in the Fund will consist of income after
expenses, currency gains (or losses) and security price gains (or losses)
in terms of the local currency. For tax purposes, realized gains and losses
on currency are regarded as ordinary income and loss and could, under
certain circumstances, have an impact on distributions. The value of the
Fund's portfolio will fluctuate in response to various economic factors
including fluctuations in foreign currency exchange rates. Please refer to
"Currency risk" for additional information.
Since most of the Fund's investments are denominated in foreign currencies,
exchange rates have a significant impact on total Fund performance. For
example, a fall in the U.S. dollar's value relative to the British Pound
Sterling will increase the U.S. dollar value of a British bond held in the
portfolio, even though the price of that bond in Pound terms remains
unchanged. Conversely, if the U.S. dollar rises in value relative to the
Pound, the U.S. dollar value of a British bond will fall. Investors should
be aware that exchange rate movements can be significant and can endure for
long periods of time.
The Adviser attempts to manage exchange rate and interest rate risks
through active portfolio management. The Adviser's techniques include
management of currency, bond market and maturity exposure, and security
selection, which will reflect the Adviser's outlook for the interest rate
cycle in various countries and changes in foreign currency exchange rates.
In the markets in which the Fund invests, longer maturity bonds tend to
fluctuate more in price as interest rates change than shorter-term
instruments--again providing both opportunity and risk. There can be no
assurance of success in these attempts to minimize risk.
Investments in foreign securities involve special considerations due to
more limited information, higher brokerage costs, different accounting
standards, thinner trading markets and the likely impact of foreign taxes
on the yield from debt securities. They may also entail certain risks, such
as the possibility of one or more of the following: imposition of dividend
or interest withholding or confiscatory taxes, currency blockages or
transfer restrictions, expropriation, nationalization or other adverse
political or economic developments, less government supervision and
regulation of securities exchanges, brokers and listed companies and the
difficulty of enforcing obligations in other countries. Purchases of
foreign securities are usually made in foreign currencies and, as a result,
the Fund may incur currency conversion costs and may be affected favorably
or unfavorably by changes in the value of foreign currency against the U.S.
dollar. Further, it may be more difficult for the Fund's agents to keep
currently informed about corporate or government actions which may affect
the prices of portfolio securities. Communications between the U.S. and
foreign countries may be less reliable than within the U.S., thus
increasing the risk of delayed settlements of portfolio transactions or
loss of certificates for portfolio securities. The Fund's ability and
decisions to purchase and sell portfolio securities may be affected by laws
or regulations relating to the convertibility and repatriation of assets.
Because of the Fund's investment approach, investors should not rely on an
investment in the Fund for their short-term financial needs and should not
view the Fund as a vehicle for playing short-term swings in the
international bond and foreign exchange markets. Shares of the Fund alone
should not be regarded as a complete investment program.
Additional information about policies and investments
Investment restrictions
The Fund has adopted certain fundamental policies which may not be changed
without a vote of shareholders and which are designed to reduce the Fund's
investment risk.
The Fund may not borrow money except as a temporary measure for
extraordinary or emergency purposes or except in connection with reverse
repurchase agreements and may not make loans except through the lending of
portfolio securities, the purchase of debt securities or through repurchase
agreements.
In addition, as a matter of nonfundamental policy, the Fund may not invest
more than 10% of its net assets in securities which are not readily
marketable, in restricted securities or in repurchase agreements
maturing in more than seven days. The Fund may not invest more than 5% of
its total assets in restricted securities.
A complete description of these and other policies and restrictions is
contained under "The Fund's Investment Objectives and Policies" in the
Fund's Statement of Additional Information.
Repurchase agreements
As a means of earning income for periods as short as overnight, the Fund
may enter into repurchase agreements with selected banks and
broker/dealers. Under a repurchase agreement, the Fund acquires securities,
subject to the seller's agreement to repurchase at a specified time and
price. The Fund may also enter into repurchase commitments for investment
purposes for periods of 30 days or more. Such commitments involve
investment risk similar to that of debt securities in which the Fund
invests.
When-issued securities
The Fund may purchase securities on a when-issued or forward delivery
basis, for payment and delivery at a later date. The price and yield are
generally fixed on the date of commitment to purchase. During the period
between purchase and settlement, no interest accrues to the Fund. At the
time of settlement, the market value of the security may be more or less
than the purchase price.
Mortgage and other asset-backed securities
The Fund may invest in mortgage-backed securities, which are securities
representing interests in pools of mortgage loans. The securities provide
shareholders with payments consisting of both interest and principal as the
mortgages in the underlying mortgage pools are paid off. The timely payment
of principal and interest on mortgage-backed securities issued or
guaranteed by the Government National Mortgage Association ("GNMA") is
backed by GNMA and the full faith and credit of the U.S. Government. These
guarantees, however, do not apply to the market value or yield of
mortgage-backed securities or to the value of Fund shares. Also, GNMA and
other mortgage-backed securities may be purchased at a premium over the
maturity value of the underlying mortgages. This premium is not guaranteed
and will be lost if prepayment occurs.
The Fund may also invest in securities representing interests in pools of
certain other consumer loans, such as automobile loans and credit card
receivables. In some cases, principal and interest payments are partially
guaranteed by a letter of credit from a financial institution.
Dollar roll transactions
The Fund may enter into dollar roll transactions with selected banks and
broker/dealers. Dollar roll transactions are treated as reverse repurchase
agreements for purposes of the Fund's borrowing restrictions and consist of
the sale by the Fund of mortgage-backed securities, together with a
commitment to purchase similar, but not identical, securities at a future
date, at the same price. In addition, the Fund is paid a fee as
consideration for entering into the commitment to purchase. Dollar rolls
may be renewed after cash settlement and initially may involve only a firm
commitment agreement by the Fund to buy a security.
Convertible securities
The Fund may invest in convertible securities which may offer higher income
than the common stocks into which they are convertible. The convertible
securities in which the Fund may invest consists of bonds, notes,
debentures and preferred stocks which may be converted or exchanged at a
stated or determinable exchange ratio into underlying shares of common
stock. Prior to their conversion, convertible securities may have
characteristics similar to nonconvertible securities.
Portfolio turnover
Recent economic and market conditions have necessitated more active
trading, resulting in a higher portfolio turnover rate for the Fund. A
higher rate involves greater transaction costs to the Fund and may result
in the realization of net capital gains, which would be taxable to
shareholders when distributed.
Strategic Transactions and derivatives
The Fund may, but is not required to, utilize various other investment
strategies as described below to hedge various market risks (such as
interest rates, currency exchange rates, and broad or specific equity or
fixed-income market movements), to manage the effective maturity or
duration of the Fund's portfolio or to enhance potential gain. These
strategies may be executed through the use of derivative contracts. Such
strategies are generally accepted as a part of modern portfolio management
and are regularly utilized by many mutual funds and other institutional
investors. Techniques and instruments may change over time as new
instruments and strategies are developed or regulatory changes occur.
In the course of pursuing these investment strategies, the Fund may
purchase and sell exchange-listed and over-the-counter put and call options
on securities, equity and fixed-income indices and other financial
instruments, purchase and sell financial futures contracts and options
thereon, enter into various interest rate transactions such as swaps, caps,
floors or collars, and enter into various currency transactions such as
currency forward contracts, currency futures contracts, currency swaps or
options on currencies or currency futures (collectively, all the above are
called "Strategic Transactions").
Strategic Transactions may be used without limit to attempt to protect
against possible changes in the market value of securities held in or to be
purchased for the Fund's portfolio resulting from securities markets or
currency exchange rate fluctuations, to protect the Fund's unrealized gains
in the value of its portfolio securities, to facilitate the sale of such
securities for investment purposes, to manage the effective maturity or
duration of the Fund's portfolio, or to establish a position in the
derivatives markets as a temporary substitute for purchasing or selling
particular securities. Some Strategic Transactions may also be used to
enhance potential gain although no more than 5% of the Fund's assets will
be committed to Strategic Transactions entered into for non-hedging
purposes. Any or all of these investment techniques may be used at any time
and in any combination, and there is no particular strategy that dictates
the use of one technique rather than another, as use of any Strategic
Transaction is a function of numerous variables including market
conditions. The ability of the Fund to utilize these Strategic Transactions
successfully will depend on the Adviser's ability to predict pertinent
market movements, which cannot be assured. The Fund will comply with
applicable regulatory requirements when implementing these strategies,
techniques and instruments. Strategic Transactions involving financial
futures and options thereon will be purchased, sold or entered into only
for bona fide hedging, risk management or portfolio management purposes and
not for speculative purposes. Please refer to "Risk factors--Strategic
Transactions and derivatives" for more information.
Risk factors
The Fund's risks are determined by the nature of the securities held and
the portfolio management strategies used by the Adviser. The following are
descriptions of certain risks related to the investments and techniques
that the Fund may use from time to time.
Bonds. The Fund will invest no more than 10% of its total assets in debt
securities rated below investment-grade, that is, below BBB by S&P or below
Baa by Moody's or in unrated securities of equivalent quality as determined
by the Adviser. Securities rated below investment-grade are commonly
referred to as "junk bonds" and usually entail greater risk (including the
possibility of default or bankruptcy of the issuers), and generally involve
greater price volatility and higher degrees of speculation with respect to
the payment of principal and interest. In addition, the trading market for
those securities is generally less liquid than for higher-rated securities
and the Fund may have difficulty disposing of these securities at the time
it may wish to do so. The lack of a liquid secondary market for certain
securities may also make it more difficult for a Fund to obtain accurate
market quotations for purposes of valuing its portfolio and calculating its
net asset value. Prices for below investment-grade securities may be
affected by legislative and regulatory developments.
Non-diversified investment company. As a "non-diversified" investment
company, the Fund may invest a greater proportion of its assets in the
securities of a smaller number of issuers and therefore may be subject to
greater market and credit risk than a more broadly diversified portfolio.
Repurchase agreements. If the seller under a repurchase agreement becomes
insolvent, the Fund's right to dispose of the securities may be restricted.
In the event of the commencement of bankruptcy or insolvency proceedings
with respect to the seller of the securities under a repurchase agreement,
the Fund may encounter delay and incur costs before being able to sell the
securities. Also, if the seller defaults, the value of such securities may
decline before the Fund is able to dispose of them.
Mortgage and other asset-backed securities. Unscheduled or early payments
on the underlying mortgages may shorten the securities' effective
maturities and lessen their growth potential. The Fund may agree to
purchase or sell these securities with payment and delivery taking place at
a future date. A decline in interest rates may lead to a faster rate of
repayment of the underlying mortgages, and expose the Fund to a lower rate
of return upon reinvestment. To the extent that such mortgage-backed
securities are held by the Fund, the prepayment right of mortgagors may
limit the increase in net asset value of the Fund because the value of the
mortgage-backed securities held by the Fund may not appreciate as rapidly
as the price of non-callable debt securities.
(Continued on page 14)
Purchases
Opening an account
Minimum initial investment: $1,000; IRAs $500
Group retirement plans (401(k), 403(b), etc.) have similar or lower
minimums. See appropriate plan literature.
Make checks payable to "The Scudder Funds."
* By Mail
Send your completed and signed application and check
by regular mail to: or by express,
registered,
or certified mail to:
The Scudder Funds The Scudder Funds
P.O. Box 2291 1099 Hingham Street
Boston, MA Rockland, MA
02107-2291 02370-1052
* By Wire
Please see Transaction information--Purchasing shares--
By wire following these tables for details, including the ABA wire
transfer number. Then call 1-800-225-5163 for instructions.
* In Person
Visit one of our Funds Centers to complete your application with the
help of a Scudder representative. Funds Center locations are listed
under Shareholder benefits.
Purchasing additional shares
Minimum additional investment: $100; IRAs $50
Group retirement plans (401(k), 403(b), etc.) have similar or lower
minimums. See appropriate plan literature.
Make checks payable to "The Scudder Funds."
* By Mail
Send a check with a Scudder investment slip, or with a letter of
instruction including your account number and the complete Fund name,
to the appropriate address listed above.
* By Wire
Please see Transaction information--Purchasing shares--
By wire following these tables for details, including the ABA wire
transfer number.
* In Person
Visit one of our Funds Centers to make an additional investment in
your Scudder fund account. Funds Center locations are listed under
Shareholder benefits.
* By Automatic Investment Plan ($50 minimum)
You may arrange to make investments on a regular basis through
automatic deductions from your bank checking account. Please call
1-800-225-5163 for more information and an enrollment form.
Exchanges and redemptions
Exchanging shares
Minimum investments: $1,000 to establish a new account; $100 to exchange
among existing accounts
* By Telephone
To speak with a service representative, call 1-800-225-5163 from 8
a.m. to 8 p.m. eastern time or to access SAIL(tm), Scudder's Automated
Information Line, call 1-800-343-2890 (24 hours a day).
* By Mail or Fax
Print or type your instructions and include:
- the name of the Fund and the account number you are exchanging
from;
- your name(s) and address as they appear on your account;
- the dollar amount or number of shares you wish to exchange;
- the name of the Fund you are exchanging into; and
- your signature(s) as it appears on your account and a daytime
telephone number.
Send your instructions
by regular mail to: or by express, or by fax to:
registered, or
certified mail to:
The Scudder Funds The Scudder Funds 1-800-821-6234
P.O. Box 2291 1099 Hingham Street
Boston, MA Rockland, MA
02107-2291 02370-1052
Redeeming shares
* By Telephone
To speak with a service representative, call 1-800-225-5163 from 8
a.m. to 8 p.m. eastern time or to access SAIL(tm), Scudder's Automated
Information Line, call 1-800-343-2890 (24 hours a day). You may have
redemption proceeds sent to your predesignated bank account, or
redemption proceeds of up to $50,000 sent to your address of record.
* By Mail or Fax
Send your instructions for redemption to the appropriate address or
fax number above and include:
- the name of the Fund and account number you are redeeming from;
- your name(s) and address as they appear on your account;
- the dollar amount or number of shares you wish to redeem; and
- your signature(s) as it appears on your account and a daytime
telephone number.
A signature guarantee is required for redemptions over $50,000. See
Transaction information--Redeeming shares following these tables.
* By Automatic Withdrawal Plan
You may arrange to receive automatic cash payments periodically if the
value of your account is $10,000 or more. Call 1-800-225-5163 for more
information and an enrollment form.
(Continued from page 11)
In addition to prepayment risk, securities representing pools of certain
consumer loans present certain risks that are not presented by
mortgage-backed securities. These securities may not have the benefit of
any security interest in the underlying assets. Also, there is the
possibility that recoveries on repossessed collateral may not, in some
cases, be available to support payments on these securities.
Dollar roll transactions. If the broker/dealer to whom the Fund sells the
securities becomes insolvent, the Fund's right to purchase or repurchase
the securities may be restricted; the value of the securities may change
adversely over the term of the dollar roll; the securities that the Fund is
required to repurchase may be worth less than the securities that the Fund
originally held, and the return earned by the Fund with the proceeds of a
dollar roll may not exceed transaction costs.
Convertible securities. While convertible securities generally offer lower
yields than nonconvertible debt securities of similar quality, their prices
may reflect changes in the value of the underlying common stock.
Convertible securities entail less credit risk than the issuer's common
stock.
Strategic Transactions and derivatives. Strategic Transactions, including
derivative contracts, have risks associated with them including possible
default by the other party to the transaction, illiquidity and, to the
extent the Adviser's view as to certain market movements is incorrect, the
risk that the use of such Strategic Transactions could result in losses
greater than if they had not been used. Use of put and call options may
result in losses to the Fund, force the sale or purchase of portfolio
securities at inopportune times or for prices higher than (in the case of
put options) or lower than (in the case of call options) current market
values, limit the amount of appreciation the Fund can realize on its
investments or cause the Fund to hold a security it might otherwise sell.
The use of currency transactions can result in the Fund incurring losses as
a result of a number of factors including the imposition of exchange
controls, suspension of settlements or the inability to deliver or receive
a specified currency. The use of options and futures transactions entails
certain other risks. In particular, the variable degree of correlation
between price movements of futures contracts and price movements in the
related portfolio position of the Fund creates the possibility that losses
on the hedging instrument may be greater than gains in the value of the
Fund's position. In addition, futures and options markets may not be liquid
in all circumstances and certain over-the-counter options may have no
markets. As a result, in certain markets, the Fund might not be able to
close out a transaction without incurring substantial losses, if at all.
Although the use of futures contracts and options transactions for hedging
should tend to minimize the risk of loss due to a decline in the value of
the hedged position, at the same time they tend to limit any potential gain
which might result from an increase in value of such position. Finally, the
daily variation margin requirements for futures contracts would create a
greater ongoing potential financial risk than would purchases of options,
where the exposure is limited to the cost of the initial premium. Losses
resulting from the use of Strategic Transactions would reduce net asset
value, and possibly income, and such losses can be greater than if the
Strategic Transactions had not been utilized. The Strategic Transactions
that the Fund may use and some of their risks are described more fully in
the Fund's Statement of Additional Information.
Distribution and performance information
Dividends and capital gains distributions
The Fund's dividends from net investment income are declared daily and
distributed monthly. The Fund intends to distribute net realized capital
gains after utilization of capital loss carryforwards and net currency
gains, if any, in December to prevent application of a federal excise tax.
Any dividends or capital gains distributions declared in October, November
or December with a record date in such a month and paid during the
following January will be treated by shareholders for federal income tax
purposes as if received on December 31 of the calendar year declared.
According to preference, shareholders may receive distributions in cash or
have them reinvested in additional shares of the Fund. If an investment is
in the form of a retirement plan, all dividends and capital gains
distributions must be reinvested into the shareholder's account.
Generally, dividends from net investment income are taxable to investors as
ordinary income. Certain realized gains or losses on the sale or retirement
of international bonds held by the Fund, to the extent attributable to
fluctuations in currency exchange rates, as well as certain other gains or
losses attributable to exchange rate fluctuations, must be treated as
ordinary income or loss. Such income or loss may increase or decrease (or
possibly eliminate) the Fund's income available for distribution to
shareholders. If, under the rules governing the tax treatment of foreign
currency gains and losses, the Fund's income available for distribution is
decreased or eliminated, all or a portion of the dividends declared by the
Fund may be treated for federal income tax purposes as a non-taxable return
of capital distribution. Generally, a shareholder's tax basis in Fund
shares will be reduced to the extent that an amount distributed to the
shareholder is treated as a return of capital. The Fund may reduce its
daily dividend to lessen the effect of these rules. If the Fund's income is
increased under the foreign currency taxation rules, the Fund intends to
declare additional distributions of such income in December.
Long-term capital gains distributions, if any, are taxable as long-term
capital gains regardless of the length of time you have owned your shares.
Short-term capital gains and other distributions are taxable as ordinary
income. Shareholders may be able to claim a credit or deduction on their
income tax returns for their pro rata portions of qualified taxes paid by
the Fund to foreign countries.
The Fund sends detailed tax information to shareholders about the amount
and type of its distributions by January 31 of each year.
Performance information
From time to time, quotations of the Fund's performance may be included in
advertisements, sales literature, or shareholder reports. All performance
figures are historical, show the performance of a hypothetical investment
and are not intended to indicate future performance. The "yield" of the
Fund refers to income of an investment in the Fund over a specified 30-day
(one month) period. Yield is expressed as an annualized percentage. "Total
return" is the change in value of an investment in the Fund for a specified
period. The "average annual total return" of the Fund is the average annual
compound rate of return of an investment in the Fund assuming the
investment has been held for one year and the life of the Fund as of a
stated ending date. "Cumulative total return" represents cumulative change
in value of an investment in the Fund for various periods. Total return
calculations assume that all dividends and capital gains distributions
during the period were reinvested in shares of the Fund. "Capital change"
measures return from capital, including reinvestment of any capital gains
distributions but does not include reinvestment of dividends. Performance
will vary based upon, among other things, changes in market conditions and
the level of the Fund's expenses.
Fund organization
The Fund is a non-diversified series of Scudder Global Fund, Inc. (the
"Corporation"), an open-end, management investment company registered under
the 1940 Act. The Corporation was organized as a Maryland corporation in
May 1986.
The Fund's activities are supervised by the Corporation's Board of
Directors. Shareholders have one vote for each share held on matters on
which they are entitled to vote. The Corporation is not required to hold
and has no current intention of holding annual shareholder meetings,
although special meetings may be called for purposes such as electing or
removing Directors, changing fundamental investment policies or approving
an investment advisory contract. Shareholders will be assisted in
communicating with other shareholders in connection with removing a
Director as if Section 16(c) of the 1940 Act were applicable.
Investment adviser
The Fund retains the investment management firm of Scudder, Stevens &
Clark, Inc., a Delaware corporation, to manage the Fund's daily investment
and business affairs subject to the policies established by the Board of
Directors. The Directors have overall responsibility for the management of
the Fund under Maryland law.
The Adviser receives monthly an investment advisory fee for its services
equal to 0.75% for the first $1 billion of the average daily net assets of
the Fund and 0.70% of the average daily net assets of the Fund exceeding $1
billion on an annual basis. The fee is graduated so that increases in the
Fund's net assets may result in a lower annual fee rate and decreases in
the Fund's net assets may result in a higher annual fee rate. The fee is
payable monthly, provided that the Fund will make such interim payments as
may be requested by the Adviser not to exceed 75% of the amount of the fee
then accrued on the books of the Fund and unpaid. The Adviser has agreed
not to impose all or a portion of its investment management fee and to take
other action, to the extent necessary, to maintain the annualized expenses
of the Fund at not more than 1.00% of average daily net assets of the Fund
until February 29, 1996 .
For the fiscal year ended October 31, 1994, the Adviser received an
investment management fee of 0.60% of the Fund's average daily net assets
on an annual basis.
The fee is higher than that charged many bond funds which invest primarily
in U.S. debt securities. However, management of the Fund involves analyzing
market, credit and currency relationships in a number of economies
throughout the world.
All the Fund's expenses are paid out of gross investment income.
Shareholders pay no direct charges or fees for investment or administrative
services.
Scudder, Stevens & Clark, Inc., is located at 345 Park Avenue, New York,
New York.
Transfer agent
Scudder Service Corporation, P.O. Box 2291, Boston, Massachusetts
02107-2291, a wholly-owned subsidiary of the Adviser, is the transfer,
shareholder servicing and dividend-paying agent for the Fund.
Underwriter
Scudder Investor Services, Inc., a wholly-owned subsidiary of the Adviser,
is the Fund's principal underwriter. Scudder Investor Services, Inc.
confirms, as agent, all purchases of shares of the Fund. Scudder Investor
Relations is a telephone information service provided by Scudder Investor
Services, Inc.
Transaction information
Purchasing shares
Purchases are executed at the next calculated net asset value per share
after the Fund's transfer agent in Boston receives the purchase request in
good order. Purchases are made in full and fractional shares. (See "Share
price.")
By check. If you purchase shares with a check that does not clear, your
purchase will be canceled and you will be subject to any losses or fees
incurred in the transaction. Checks must be drawn on or payable through a
U.S. bank. If you purchase shares by check and redeem them within seven
business days of purchase, the Fund may hold redemption proceeds until the
purchase check has cleared, which may take up to seven business days. If
you purchase shares by federal funds wire, you may avoid this delay.
Redemption or exchange requests by telephone prior to the expiration of the
seven-day period will not be accepted.
By wire. To open a new account by wire, first call Scudder at
1-800-225-5163 to obtain an account number. A representative will instruct
you to send a completed, signed application to the transfer agent in
Boston. Accounts cannot be opened without a completed, signed application
and a Scudder fund account number. Contact your bank to arrange a wire
transfer to:
The Scudder Funds
State Street Bank and Trust Company
Boston, MA 02101
ABA Number 011000028
DDA Account 9903-5552
Your wire instructions must also include:
-- the name of the fund in which the money is to be invested,
-- the account number of the fund, and
-- the name(s) of the account holder(s).
The account will be established once the application and money order are
received in good order.
You may also make additional investments of $100 or more to your existing
account by wire.
By exchange. Your new account will have the same registration and address
as your existing account.
The exchange requirements for corporations, other organizations, trusts,
fiduciaries, agents, institutional investors and retirement plans may be
different from those for regular accounts. Please call 1-800-225-5163 for
more information, including information about the transfer of special
account features.
You can also make exchanges among your Scudder fund accounts on SAIL, the
Scudder Automated Information Line, by calling 1-800-343-2890.
Redeeming shares
The Fund allows you to redeem shares (i.e., sell them back to the Fund)
without redemption fees.
By telephone. This is the quickest and easiest way to sell Fund shares. If
you elected telephone redemption to your bank on your application, you can
call to request that federal funds be sent to your authorized bank account.
If you did not elect telephone redemption to your bank on your application,
call 1-800-225-5163 for more information.
Redemption proceeds will be wired to your bank unless otherwise requested.
If your bank cannot receive federal reserve wires, redemption proceeds will
be mailed to your bank. There will be a $5 charge for all wire redemptions.
You can also make redemptions from your Scudder fund account on SAIL, the
Scudder Automated Information Line, by calling 1-800-343-2890.
If you open an account by wire, you cannot redeem shares by telephone until
the Fund's transfer agent has received your completed and signed
application. Telephone redemption is not available for shares held in
Scudder IRA accounts and most other Scudder retirement plan accounts.
In the event that you are unable to reach the Fund by telephone, you should
write to the Fund; see "How to contact Scudder" for the address.
Signature guarantees. For your protection and to prevent fraudulent
redemptions, on written redemption requests in excess of $50,000 we require
an original signature and an original signature guarantee for each person
in whose name the account is registered. (The Fund reserves the right,
however, to require a signature guarantee for all redemptions.) You can
obtain a signature guarantee from most banks, credit unions or savings
associations, or from broker/dealers, municipal securities broker/dealers,
government securities broker/dealers, national securities exchanges,
registered securities associations, or clearing agencies deemed eligible by
the Securities and Exchange Commission. Signature guarantees by notaries
public are not acceptable. Redemption requirements for corporations, other
organizations, trusts, fiduciaries, agents, institutional investors and
retirement plans may be different from those for regular accounts. For more
information, please call 1-800-225-5163.
Telephone transactions
Shareholders automatically receive the ability to exchange by telephone and
the right to redeem by telephone up to $50,000 to their address of record.
Shareholders also may, by telephone, request that redemption proceeds be
sent to a predesignated bank account. The Fund uses procedures designed to
give reasonable assurance that telephone instructions are genuine,
including recording telephone calls, testing a caller's identity and
sending written confirmation of telephone transactions. If the Fund does
not follow such procedures, it may be liable for losses due to unauthorized
or fraudulent telephone instructions. The Fund will not be liable for
acting upon instructions communicated by telephone that it reasonably
believes to be genuine.
Share price
Purchases and redemptions, including exchanges, are made at net asset
value. The Fund's custodian, Brown Brothers Harriman & Co., determines net
asset value per share as of the close of regular trading on the New York
Stock Exchange (the "Exchange"), normally 4 p.m. eastern time, on each day
the Exchange is open for trading. Net asset value per share is calculated
by dividing the value of total Fund assets, less all liabilities, by the
total number of shares outstanding.
Processing time
All purchase and redemption requests must be received in good order by the
Fund's transfer agent in Boston. Those requests received by the close of
regular trading on the Exchange are executed at the net asset value per
share calculated at the close of trading that day. Purchase and redemption
requests received after the close of regular trading on the Exchange will
be executed the following business day. Purchases made by federal funds
wire before noon eastern time will begin earning income that day; all other
purchases received before the close of regular trading on the Exchange will
begin earning income the next business day. Redeemed shares will earn
income on the day on which the redemption request is executed.
If you wish to make a purchase of $500,000 or more, you should notify
Scudder Investor Relations by calling 1-800-225-5163.
The Fund will normally send redemption proceeds within one business day
following the redemption request, but may take up to seven days (or longer
in the case of shares recently purchased by check).
Tax information
A redemption of shares, including an exchange into another Scudder fund, is
a sale of shares and may result in a gain or loss for income tax purposes.
Tax identification number
Be sure to complete the Tax Identification Number section of the Fund's
application when you open an account. Federal tax law requires the Fund to
withhold 31% of taxable dividends, capital gains distributions and
redemption and exchange proceeds from accounts (other than those of certain
exempt payees) without a certified Social Security or tax identification
number and certain other certified information or upon notification from
the IRS or a broker that withholding is required. The Fund reserves the
right to reject new account applications without a certified Social
Security or tax identification number. The Fund also reserves the right,
following 30 days' notice, to redeem all shares in accounts without a
certified Social Security or tax identification number. A shareholder may
avoid involuntary redemption by providing the Fund with a tax
identification number during the 30-day notice period.
Minimum balances
Shareholders should maintain a share balance worth at least $1,000, which
amount may be changed by the Board of Directors. Scudder retirement plans
have similar or lower minimum share balance requirements. The Fund reserves
the right, following 60 days' written notice to shareholders, to redeem all
shares in sub-minimum accounts, including accounts of new investors, where
a reduction in value has occurred due to a redemption or exchange out of
the account. Reductions in value that result solely from market activity
will not trigger an involuntary redemption. The Fund will mail the proceeds
of the redeemed account to the shareholder. The shareholder may restore the
share balance to $1,000 or more during the 60-day notice period and must
maintain it at no lower than that minimum to avoid involuntary redemption.
Third party transactions
If purchases and redemptions of Fund shares are arranged and settlement is
made at an investor's election through a member of the National Association
of Securities Dealers, Inc., other than Scudder Investor Services, Inc.,
that member may, at its discretion, charge a fee for that service.
Redemption-in-kind
The Fund reserves the right, if conditions exist which make cash payments
undesirable, to honor any request for redemption or repurchase order by
making payment in whole or in part in readily marketable securities chosen
by the Fund and valued as they are for purposes of computing the Fund's net
asset value (a redemption-in-kind). If payment is made in securities, a
shareholder may incur transaction expenses in converting these securities
to cash. The Corporation has elected, however, to be governed by Rule 18f-1
under the 1940 Act, as a result of which the Fund is obligated to redeem
shares, with respect to any one shareholder during any 90-day period,
solely in cash up to the lesser of $250,000 or 1% of the net asset value of
the Fund at the beginning of the period.
Shareholder benefits
Experienced professional management
Scudder, Stevens & Clark, Inc., one of the nation's most experienced
investment management firms, actively manages your Scudder fund investment.
Professional management is an important advantage for investors who do not
have the time or expertise to invest directly in individual securities.
A team approach to investing
Scudder Short Term Global Income Fund is managed by a team of Scudder
investment professionals who each play an important role in the Fund's
management process. Team members work together to develop investment
strategies and select securities for the Fund's portfolio. They are
supported by Scudder's large staff of economists, research analysts,
traders, and other investment specialists who work in Scudder's offices
across the United States and abroad. Scudder believes its team approach
benefits Fund investors by bringing together many disciplines and
leveraging Scudder's extensive resources.
Lead Portfolio Manager Margaret Craddock has set the Fund's investment
strategy and overseen its daily operation since she joined Scudder in 1991.
Ms. Craddock has seven years of experience in global fixed-income research
and investing. Gary P. Johnson, Portfolio Manager, concentrates on the
Fund's hedging strategies and research, a role he has filled since the Fund
commenced operations. Mr. Johnson joined Scudder in 1987 and has worked
with quantitative analysis and strategic trading since 1982. Lawrence
Teitelbaum, Portfolio Manager, contributes expertise on global interest
rates and currency strategies, a role he assumed when he joined Scudder in
1993. Mr. Teitelbaum has worked with global fixed-income investments and
strategies since 1981.
SAIL(tm)--Scudder Automated Information Line
For touchtone access to account information, prices and yields, or to
perform transactions in existing Scudder fund accounts, shareholders can
call Scudder's Automated Information Line (SAIL) at 1-800-343-2890. During
periods of extreme economic or market changes, or other conditions, it may
be difficult for you to effect telephone transactions in your account. In
such an event you should write to the Fund; please see "How to contact
Scudder" for the address.
Investment flexibility
Scudder offers toll-free telephone exchange between funds at current net
asset value. You can move your investments among money market, income,
growth, tax-free and growth and income funds with a simple toll-free call
or, if you prefer, by sending your instructions through the mail or by fax.
Telephone and fax redemptions and exchanges are subject to termination and
their terms are subject to change at any time by the Fund or the transfer
agent. In some cases, the transfer agent or Scudder Investor Services, Inc.
may impose additional conditions on telephone transactions.
Dividend reinvestment plan
You may have dividends and distributions automatically reinvested in
additional Fund shares. Please call 1-800-225-5163 to request this feature.
Shareholder statements
You receive a detailed account statement every time you purchase or redeem
shares. All of your statements should be retained to help you keep track of
account activity and the cost of shares for tax purposes.
Shareholder reports
In addition to account statements, you receive periodic shareholder reports
highlighting relevant information, including investment results and a
review of portfolio changes.
To reduce the volume of mail you receive, only one copy of most Fund
reports, such as the Fund's Annual Report, may be mailed to your household
(same surname, same address). Please call 1-800-225-5163 if you wish to
receive additional shareholder reports.
Newsletters
Four times a year, Scudder sends you At the Helm, an informative newsletter
covering economic and investment developments, service enhancements and
other topics of interest to Scudder fund investors.
Scudder Funds Centers
As a convenience to shareholders who like to conduct business in person,
Scudder Investor Services, Inc. maintains Funds Centers in Boca Raton,
Boston, Chicago, Cincinnati, Los Angeles, New York, Portland (OR), San
Diego, San Francisco and Scottsdale.
T.D.D. service for the hearing impaired
Scudder's full range of investor information and shareholder services is
available to hearing impaired investors through a toll-free T.D.D.
(Telephone Device for the Deaf) service. If you have access to a T.D.D.,
call 1-800-543-7916 for investment information or specific account
questions and transactions.
Scudder tax-advantaged retirement plans
Scudder offers a variety of tax-advantaged retirement plans for
individuals, businesses and non-profit organizations. These flexible plans
are designed for use with the Scudder Family of Funds (except Scudder
tax-free funds, which are inappropriate for such plans). Scudder Funds
offer a broad range of investment objectives and can be used to seek almost
any investment goal. Using Scudder's retirement plans can help shareholders
save on current taxes while building their retirement savings.
* Scudder No-Fee IRAs. These retirement plans allow a maximum annual
contribution of $2,000 per person for anyone with earned income. Many
people can deduct all or part of their contributions from their
taxable income, and all investment earnings accrue on a tax deferred
basis. The Scudder No-Fee IRA charges no annual custodial fee.
* 401(k) Plans. 401(k) plans allow employers and employees to make
tax-deductible retirement contributions. Scudder offers a full service
program that includes recordkeeping, prototype plan, employee
communications and trustee services, as well as investment options.
* Profit Sharing and Money Purchase Pension Plans. These plans allow
corporations, partnerships and people who are self-employed to make
annual, tax-deductible contributions of up to $30,000 for each person
covered by the plans. Plans may be adopted individually or paired to
maximize contributions. These are sometimes known as Keogh plans.
* 403(b) Plans. Retirement plans for tax-exempt organizations and school
systems to which employers and employees may both contribute.
* SEP-IRAs. Easily administered retirement plans for small businesses
and self-employed individuals. The maximum annual contribution to
SEP-IRA accounts is adjusted each year for inflation.
* Scudder Horizon Plan. A no-load variable annuity that lets you build
assets by deferring taxes on your investment earnings. You can start
with $2,500 or more.
Scudder Trust Company (an affiliate of the Adviser) is Trustee or Custodian
for some of these plans and is paid an annual fee for some of the above
retirement plans. For information about establishing a Scudder No-Fee IRA,
SEP-IRA, Profit Sharing Plan, Money Purchase Pension Plan or a Scudder
Horizon Plan, please call 1-800-225-2470. For information about 401(k)s or
403(b)s please call 1-800-323-6105. To effect transactions in existing IRA,
SEP-IRA, Profit Sharing or Pension Plan accounts, call 1-800-225-5163.
The variable annuity contract is provided by Charter National Life
Insurance Company (in New York State, Intramerica Life Insurance Company (S
1802)). The contract is offered by Scudder Insurance Agency, Inc. (in New
York State, Nevada and Montana, Scudder Insurance Agency of New York,
Inc.). CNL, Inc. is the Principal Underwriter. Scudder Horizon Plan is not
available in all states.
Directors and Officers
Edmond D. Villani*
Chairman of the Board and Director
Nicholas Bratt*
President and Director
Daniel Pierce*
Vice President and Director
Paul Bancroft III
Director; Venture Capitalist and Consultant
Thomas J. Devine
Director; Consultant
William H. Gleysteen, Jr.
Director; President, The Japan Society, Inc.
William H. Luers
Director; President, The Metropolitan Museum of Art
Robert G. Stone, Jr.
Director; Chairman of the Board and Director, Kirby Corporation
Robert W. Lear
Honorary Director; Executive-in-Residence, Columbia University
Graduate School of Business
Jerard K. Hartman*
Vice President
Thomas W. Joseph*
Vice President
Douglas M. Loudon*
Vice President
Gerald J. Moran*
Vice President
Cornelia M. Small*
Vice President
Lawrence Teitelbaum*
Vice President
Thomas F. McDonough*
Vice President and Secretary
Pamela A. McGrath*
Vice President and Treasurer
David S. Lee*
Vice President and Assistant Treasurer
Edward J. O'Connell*
Vice President and Assistant Treasurer
Juris Padegs*
Vice President and Assistant Secretary
Kathryn L. Quirk*
Vice President and Assistant Secretary
Coleen Downs Dinneen*
Assistant Secretary
* Scudder, Stevens & Clark, Inc.
Investment products and services
The Scudder Family of Funds
Money market
Scudder Cash Investment Trust
Scudder U.S. Treasury Money Fund
Tax free money market+
Scudder Tax Free Money Fund
Scudder California Tax Free Money Fund*
Scudder New York Tax Free Money Fund*
Tax free+
Scudder California Tax Free Fund*
Scudder High Yield Tax Free Fund
Scudder Limited Term Tax Free Fund
Scudder Managed Municipal Bonds
Scudder Massachusetts Limited Term Tax Free Fund*
Scudder Massachusetts Tax Free Fund*
Scudder Medium Term Tax Free Fund
Scudder New York Tax Free Fund*
Scudder Ohio Tax Free Fund*
Scudder Pennsylvania Tax Free Fund*
Growth and Income
Scudder Balanced Fund
Scudder Growth and Income Fund
Income
Scudder Emerging Markets Income Fund
Scudder GNMA Fund
Scudder Income Fund
Scudder International Bond Fund
Scudder Short Term Bond Fund
Scudder Short Term Global Income Fund
Scudder Zero Coupon 2000 Fund
Growth
Scudder Capital Growth Fund
Scudder Development Fund
Scudder Global Fund
Scudder Global Small Company Fund
Scudder Gold Fund
Scudder Greater Europe Growth Fund
Scudder International Fund
Scudder Latin America Fund
Scudder Pacific Opportunities Fund
Scudder Quality Growth Fund
Scudder Value Fund
The Japan Fund
Retirement Plans and Tax-Advantaged Investments
IRAs
Keogh Plans
Scudder Horizon Plan*+++ (a variable annuity)
401(k) Plans
403(b) Plans
SEP-IRAs
Profit Sharing and Money Purchase Pension Plans
Closed-end Funds#
The Argentina Fund, Inc.
The Brazil Fund, Inc.
The First Iberian Fund, Inc.
The Korea Fund, Inc.
The Latin America Dollar Income Fund, Inc.
Montgomery Street Income Securities, Inc.
Scudder New Asia Fund, Inc.
Scudder New Europe Fund, Inc.
Scudder World Income Opportunities Fund, Inc.
Institutional Cash Management
Scudder Institutional Fund, Inc.
Scudder Fund, Inc.
Scudder Treasurers Trust(tm)++
For complete information on any of the above Scudder funds, including
management fees and expenses, call or write for a free prospectus. Read it
carefully before you invest or send money. +A portion of the income from
the tax-free funds may be subject to federal, state and local taxes. *Not
available in all states. +++A no-load variable annuity contract provided by
Charter National Life Insurance Company and its affiliate, offered by
Scudder's insurance agencies, 1-800-225-2470. #These funds, advised by
Scudder, Stevens & Clark, Inc., are traded on various stock exchanges.
++For information on Scudder Treasurers Trust(tm), an institutional cash
management service that utilizes certain portfolios of Scudder Fund, Inc.
($100,000 minimum), call: 1-800-541-7703.
How to contact Scudder
Account Service and Information:
For existing account service and transactions
Scudder Investor Relations
1-800-225-5163
For account updates, prices, yields, exchanges and redemptions
Scudder Automated Information Line (SAIL)
1-800-343-2890
Investment Information:
To receive information about the Scudder funds, for additional
applications and prospectuses, or for investment questions
Scudder Investor Relations
1-800-225-2470
For establishing 401(k) and 403(b) plans
Scudder Defined Contribution Services
1-800-323-6105
Please address all correspondence to:
The Scudder Funds
P.O. Box 2291
Boston, Massachusetts
02107-2291
Or Stop by a Scudder Funds Center:
Many shareholders enjoy the personal, one-on-one service of the
Scudder Funds Centers. Check for a Funds Center near you--they can be
found in the following cities:
Boca Raton
Boston
Chicago
Cincinnati
Los Angeles
New York
Portland, OR
San Diego
San Francisco
Scottsdale
For information on Scudder Treasurers Trust(tm), an institutional cash
management service for corporations, non-profit organizations and trusts
which utilizes certain portfolios of Scudder Fund, Inc.* ($100,000
minimum), call: 1-800-541-7703.
For information on Scudder Institutional Funds*, funds designed to meet the
broad investment management and service needs of banks and other
institutions, call: 1-800-854-8525.
Scudder Investor Relations and Scudder Funds Centers are services provided
through Scudder Investor Services, Inc., Distributor.
* Contact Scudder Investor Services, Inc., Distributor, to receive a
prospectus with more complete information, including management fees and
expenses. Please read it carefully before you invest or send money.
