File No. 33-6013
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 13 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 13 [X]
(Check appropriate box or boxes.)
DREYFUS STRATEGIC INVESTING
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Daniel C. Maclean III, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
immediately upon filing pursuant to paragraph (b) of Rule 485
X on January 28, 1994 pursuant to paragraph (b) of Rule 485
60 days after filing pursuant to paragraph (a) of Rule 485
on (date) pursuant to paragraph (a) of Rule 485
Registrant has registered an indefinite number of shares of beneficial
interest under the Securities Act of 1933 pursuant to Section 24(f) of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for the
fiscal year ended October 31, 1993 was filed on December 29, 1993.
DREYFUS STRATEGIC INVESTING
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
- --------- ------- ----
1 Cover Page Cover
2 Synopsis 2
3 Condensed Financial Information 3
4 General Description of Registrant 5, 29
5 Management of the Fund 16
6 Capital Stock and Other Securities 29
7 Purchase of Securities Being Offered 17
8 Redemption or Repurchase 23
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
- ----------
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History *
13 Investment Objectives and Policies B-2
14 Management of the Fund B-9
15 Control Persons and Principal B-11
Holders of Securities
16 Investment Advisory and Other B-11, B-12
Services
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS STRATEGIC INVESTING
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
- ---------- -------- ----
17 Brokerage Allocation B-23
18 Capital Stock and Other Securities B-25
19 Purchase, Redemption and Pricing B-14, B-16,
of Securities Being Offered B-21
20 Tax Status *
21 Underwriters B-14
22 Calculations of Performance Data B-24
23 Financial Statements B-32
Items in
Part C of
Form N-1A
- ----------
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-4
Common Control with Registrant
26 Number of Holders of Securities C-4
27 Indemnification C-4
28 Business and Other Connections of C-5
Investment Adviser
29 Principal Underwriters C-30
30 Location of Accounts and Records C-37
31 Management Services C-37
32 Undertakings C-37
NOTE: * Omitted since answer is negative or inapplicable.
- -------------------------------------------------------------------------------
PROSPECTUS JANUARY 28, 1994
DREYFUS STRATEGIC INVESTING
- -------------------------------------------------------------------------------
DREYFUS STRATEGIC INVESTING (THE "FUND") IS AN OPEN-END, NON-DIVERSIFIED,
MANAGEMENT INVESTMENT COMPANY, KNOWN AS A MUTUAL FUND. ITS GOAL IS
CAPITAL GROWTH. THE FUND INVESTS PRINCIPALLY IN COMMON STOCKS OF
DOMESTIC ISSUERS, AS WELL AS SECURITIES OF FOREIGN COMPANIES AND FOREIGN
GOVERNMENTS. INVESTMENTS ALSO MAY BE MADE IN CONVERTIBLE SECURITIES,
WARRANTS, PREFERRED STOCKS AND DEBT SECURITIES UNDER CERTAIN MARKET
CONDITIONS. IN ADDITION TO USUAL INVESTMENT PRACTICES, THE FUND MAY USE
SPECULATIVE INVESTMENT TECHNIQUES SUCH AS SHORT-SELLING, LEVERAGING AND
OPTIONS TRANSACTIONS. THE FUND ALSO MAY ENGAGE IN FUTURES TRANSACTIONS.
YOU CAN PURCHASE OR REDEEM SHARES BY TELEPHONE USING DREYFUS
TELETRANSFER.
THE DREYFUS CORPORATION PROFESSIONALLY MANAGES THE FUND'S PORTFOLIO.
BY THIS PROSPECTUS, CLASS A AND CLASS B SHARES OF THE FUND ARE BEING
OFFERED. CLASS A SHARES ARE SUBJECT TO A SALES CHARGE IMPOSED AT THE TIME
OF PURCHASE AND CLASS B SHARES ARE SUBJECT TO A CONTINGENT DEFERRED
SALES CHARGE IMPOSED ON REDEMPTIONS MADE WITHIN SIX YEARS OF PURCHASE.
OTHER DIFFERENCES BETWEEN THE TWO CLASSES INCLUDE THE SERVICES OFFERED
TO AND THE EXPENSES BORNE BY EACH CLASS AND CERTAIN VOTING RIGHTS, AS
DESCRIBED HEREIN. THE FUND OFFERS THESE ALTERNATIVES SO AN INVESTOR MAY
CHOOSE THE METHOD OF PURCHASING SHARES THAT IS MOST BENEFICIAL GIVEN THE
AMOUNT OF THE PURCHASE, THE LENGTH OF TIME THE INVESTOR EXPECTS TO HOLD
THE SHARES AND OTHER CIRCUMSTANCES.
--------------
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR
FUTURE REFERENCE.
PART B (ALSO KNOWN AS THE STATEMENT OF ADDITIONAL INFORMATION), DATED
JANUARY 28, 1994, WHICH MAY BE REVISED FROM TIME TO TIME, PROVIDES A
FURTHER DISCUSSION OF CERTAIN AREAS IN THIS PROSPECTUS AND OTHER MATTERS
WHICH MAY BE OF INTEREST TO SOME INVESTORS. IT HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION AND IS INCORPORATED HEREIN BY
REFERENCE. FOR A FREE COPY, WRITE TO THE FUND AT 144 GLENN CURTISS
BOULEVARD, UNIONDALE, NEW YORK 11556-1044, OR CALL 1-800-654-6561. WHEN
TELEPHONING, ASK FOR OPERATOR 666.
--------------
THE FUND'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. THE FUND'S SHARES INVOLVE CERTAIN INVESTMENT RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL. THE FUND'S SHARE PRICE AND INVESTMENT RETURN
FLUCTUATE AND ARE NOT GUARANTEED.
- -------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
FEE TABLE.................................................. 2
CONDENSED FINANCIAL INFORMATION............................ 3
ALTERNATIVE PURCHASE METHODS............................... 4
DESCRIPTION OF THE FUND.................................... 5
MANAGEMENT OF THE FUND..................................... 16
HOW TO BUY FUND SHARES..................................... 17
SHAREHOLDER SERVICES....................................... 21
HOW TO REDEEM FUND SHARES.................................. 24
DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN............ 27
DIVIDENDS, DISTRIBUTIONS AND TAXES......................... 27
PERFORMANCE INFORMATION.................................... 29
GENERAL INFORMATION........................................ 29
- -------------------------------------------------------------------------------
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.
- -------------------------------------------------------------------------------
FEE TABLE
CLASS A CLASS B
------- -------
Shareholder Transaction Expenses:
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price).................... 4.50% ---
Maximum Deferred Sales Charge Imposed on Redemptions
(as a percentage of the amount subject to charge)...... --- 4.00%
Annual Fund Operating Expenses:
(as a percentage of average daily net assets)
Management Fees........................................ .75% .75%
12b-1 Fees............................................. -- .75%
Service Fees........................................... .25% .25%
Other Expenses......................................... .74% .74%
Total Fund Operating Expenses.......................... 1.74% 2.49%
Example:
An investor would pay the following
expenses on a $1,000 investment,
assuming (1) 5% annual return and
(2) except where noted, redemption
at the end of each time period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS*
------ ------- ------- ---------
CLASS A: $62 $ 97 $135 $241
CLASS B: $65 $108 $153 $247
ASSUMING NO REDEMPTION OF
CLASS B SHARES: $25 $ 78 $133 $247
*Ten-year figures assume conversion of Class B shares to Class A
shares at end of sixth year following the date of purchase.
- -------------------------------------------------------------------------------
The amounts listed in the example should not be considered as
representative of past or future expenses and actual expenses may be
greater or less than those indicated. Moreover, while the example assumes
a 5% annual return, the Fund's actual performance will vary and may result
in an actual return greater or less than 5%.
- -------------------------------------------------------------------------------
The purpose of the foregoing table is to assist you in understanding the
various costs and expenses that investors will bear, directly or indirectly,
the payment of which will reduce investors' return on an annual basis. For
Class B shares, Other Expenses and Total Fund Operating Expenses are
estimated based on expenses incurred by the Class A shares. Prior to
January 15, 1993, Class A shares were subject to 12b-1 fees, but no
service fees. Long-term investors in Class B shares could pay more in
12b-1 fees than the economic equivalent of paying a front-end sales
charge. Certain Service Agents (as defined below) may charge their clients
direct fees for effecting transactions in Fund shares; such fees are not
reflected in the foregoing table. See "Management of the Fund," "How to
Buy Fund Shares" and "Distribution Plan and Shareholder Services Plan."
(2)
CONDENSED FINANCIAL INFORMATION
The information in the following table has been audited by Ernst & Young,
the Fund's independent auditors, whose report thereon appears in the
Fund's Statement of Additional Information. Further financial data and
related notes are included in the Fund's Statement of Additional
Information, available upon request.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
beneficial interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each period indicated. The
information has been derived from information provided in the Fund's
financial statements.
<TABLE>
<CAPTION>
CLASS A SHARES
--------------------------------------------------------------
YEAR ENDED OCTOBER 31,
--------------------------------------------------------------
PER SHARE DATA: 1986(1) 1987 1988 1989 1990
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period................... $12.50 $12.51 $15.79 $15.85 $18.73
------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income (loss)-net........................... .06 .13 1.00 .48 .31
Net realized and unrealized gain (loss)
on investments.................................... .01 3.15 (.52) 3.70 (.35)
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS............... .07 3.28 .48 4.18 (.04)
------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment income--net.................. (.06) -- (.20) (1.30) (.21)
Dividends from net realized gain on investments........ -- -- (.22) -- (.45)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS............................ (.06) -- (.42) (1.30) (.66)
------ ------ ------ ------ ------
Net asset value, end of period......................... $12.51 $15.79 $15.85 $18.73 $18.03
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN (3): .31%(4) 26.22% 2.88% 28.59% (.31%)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to average net assets...... -- 1.59% 1.48% 1.50% 1.50%
Ratio of interest expense, loan commitment
fees and dividends on securities sold short to
average net assets................................. -- .32% .60% .59% 1.39%
Ratio of net investment income (loss) to average
net assets......................................... .50%(4) 1.14% 5.71% 2.63% 1.66%
Decrease reflected in above expense ratios due to
expense limitation................................. 1.04%(4) .10% .19% .29% .08%
Portfolio Turnover Rate................................ -- 321.23% 167.64% 228.12% 275.33%
Net Assets, end of period (000's Omitted).............. $1,145 $111,896 $104,772 $106,180 $102,421
</TABLE>
<TABLE>
<CAPTION>
Class A Shares Class B Shares
------------------------------- --------------
Year Ended October 31, Period Ended
------------------------------- October 31,
PER SHARE DATA: 1991 1992 1993 1993(2)
------ ------ ------
<S> <C> <C> <C> <C>
Net asset value, beginning of period................... $18.03 $22.12 $19.90 $21.38
------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income (loss)-net........................... .21 .06 .03 (.07)
Net realized and unrealized gain (loss)
on investments.................................... 5.77 (.46) 3.89 2.31
------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS............... 5.98 (.40) 3.92 2.24
------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment income--net.................. (.34) (.14) (.05) --
Dividends from net realized gain on investments........ (1.55) (1.68) -- --
------ ------ ------ ------
TOTAL DISTRIBUTIONS............................ (1.89) (1.82) (.05) --
------ ------ ------ ------
Net asset value, end of period......................... $22.12 $19.90 $23.77 $23.62
====== ====== ====== ======
TOTAL INVESTMENT RETURN (3): 36.50% (2.04%) 19.71% 10.48%(4)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to average net assets...... 1.35% 1.30% 1.27% 1.65%(4)
Ratio of interest expense, loan commitment
fees and dividends on securities sold short to
average net assets................................. .58% .38% .47% .44%(4)
Ratio of net investment income (loss) to average
net assets......................................... 1.07% .22% .16% (.69%)(4)
Decrease reflected in above expense ratios due to
expense limitation................................. -- -- -- --
Portfolio Turnover Rate................................ 207.10% 204.73% 237.14% 237.14%
Net Assets, end of period (000's Omitted).............. $145,717 $243,148 $276,022 $25,833
- ------------------------------
(1)From October 1, 1986 (commencement of operations) to October 31, 1986
(2)From January 15, 1993 (commencement of initial offering) to October 31, 1993.
(3)Exclusive of sales charge.
(4)Not annualized.
</TABLE>
Further information about the Fund's performance is contained in the
Fund's annual report, which may be obtained without charge by writing to
the address or calling the number set forth on the cover page of this
Prospectus.
(3)
<TABLE>
<CAPTION>
DEBT OUTSTANDING
YEAR ENDED OCTOBER 31,
------------------------------------------------------------------------
1986(1) 1987 1988 1989 1990 1991 1992 1993
------- ----- ----- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Amount of debt outstanding at
end of year (in thousands).................... -- -- -- $18,350 $ 9,020 $23,994 $23,300 $35,100
Average amount of debt
outstanding throughout
year (in thousands)(2)....................... -- $ 2,513 $6,145 $ 4,843 $10,388 $12,882 $ 5,102 $16,419
Average number of shares
outstanding throughout
year (in thousands)(3)....................... -- 5,193 7,102 6,161 5,807 6,244 10,058 12,321
Average amount of debt per share
throughout year.............................. -- $ .48 $ .87 $ .79 $ 1.79 $ .46 $ .51 $ 1.33
- ------------------------
(1) From October 1, 1986 (commencement of operations) to October 31, 1986.
(2) Based upon daily outstanding borrowings.
(3) Based upon month-end balances.
</TABLE>
ALTERNATIVE PURCHASE METHODS
The Fund offers you two methods of purchasing Fund shares; you may
choose the Class of shares that best suits your needs, given the amount of
your purchase, the length of time you expect to hold your shares and any
other relevant circumstances. Each Class A and Class B share represents
an identical pro rata interest in the Fund's investment portfolio.
Class A shares are sold at net asset value per share plus a maximum
initial sales charge of 4.50% of the public offering price imposed at the
time of purchase. The initial sales charge may be reduced or waived for
certain purchases. See "How to Buy Fund Shares - Class A Shares." These
shares are subject to an annual service fee at the rate of .25 of 1% of the
value of the average daily net assets of Class A. See "Distribution Plan
and Shareholder Services Plan - Shareholder Services Plan."
Class B shares are sold at net asset value per share with no initial sales
charge at the time of purchase; as a result, the entire purchase price is
immediately invested in the Fund. Class B shares are subject to a
maximum 4% contingent deferred sales charge ("CDSC"), which is
assessed only if you redeem Class B shares within six years of purchase.
See "How to Buy Fund Shares - Class B Shares" and "How to Redeem Fund
Shares -Contingent Deferred Sales Charge - Class B Shares." These shares
also are subject to an annual service fee at the rate of .25 of 1% of the
value of the average daily net assets of Class B. In addition, Class B
shares are subject to an annual distribution fee at the rate of .75 of 1% of
the value of the average daily net assets of Class B. See "Distribution Plan
and Shareholder Services Plan." The distribution fee paid by Class B will
cause such class to have a higher expense ratio and to pay lower dividends
than Class A. Approximately six years after the date of purchase, Class B
shares automatically will convert to Class A shares, based on the relative
net asset values for shares of each class, and will no longer be subject to
the distribution fee. Class B shares that have been acquired through the
reinvestment of dividends and distributions will be converted on a pro
rata basis together with other Class B shares, in the proportion that a
shareholder's Class B shares converting to Class A shares bears to the
total Class B shares not acquired through the reinvestment of dividends
and distributions.
You should consider whether, during the anticipated life of your
investment in the Fund, the accumulated distribution fee and CDSC on
Class B shares prior to conversion would be less than the initial sales
charge on Class A shares purchased at the same time, and to what extent,
if any, such differential would be offset by the return of Class A. In this
regard, investors qualifying for reduced initial sales charges who expect
to maintain their investment for an extended period of time might
consider purchasing Class A shares because the accumulated continuing
distribution fees on Class B shares may exceed the initial sales charge on
Class A shares during the life of the investment. Generally, Class A shares
may be more appropriate for investors who invest $100,000 or more in
Fund shares.
(4)
DESCRIPTION OF THE FUND
INVESTMENT OBJECTIVE - The Fund's goal is to provide you with capital
growth. The Fund's investment objective cannot be changed without
approval by the holders of a majority (as defined in the Investment
Company Act of 1940) of the Fund's outstanding voting shares. There can
be no assurance that the Fund's investment objective will be achieved.
MANAGEMENT POLICIES - The Fund invests principally in publicly issued
common stocks. There are no limitations on the type, size, operating
history or dividend paying record of companies or industries in which the
Fund may invest, the principal criteria for investment being that the
securities provide opportunities for capital growth. The Fund may invest
up to 30% of the value of its assets in the common stocks of foreign
companies which are not publicly traded in the United States and the debt
securities of foreign governments. The Fund may invest in convertible
securities, preferred stocks and debt securities without limitation when
management believes that such securities offer opportunities for capital
growth. The debt securities in which the Fund may invest must be rated at
least Caa by Moody's Investors Service, Inc. ("Moody's") or CCC by
Standard & Poor's Corporation ("Standard & Poor's") or if unrated, deemed
to be of comparable quality by The Dreyfus Corporation. Debt securities
rated Caa by Moody's or CCC by Standard & Poor's are considered to have
predominantly speculative characteristics with respect to capacity to pay
interest and repay principal and to be of poor standing. See "Risk Factors -
Lower Rated Securities" below for a discussion of certain risks.
The Fund's policy is to purchase marketable securities which are not
restricted as to public sale, subject to the limited exception set forth
under "Certain Portfolio Securities - Illiquid Securities" below. The Fund
will be alert to favorable arbitrage opportunities resulting from special
situations such as those arising from corporate takeovers. When
management believes it desirable, typically when it believes that common
stocks are a less attractive investment alternative and a temporary
defensive position is advisable, the Fund may invest in higher-rated
corporate bonds (i.e., debt securities of corporate issuers), U.S.
Government securities, repurchase agreements, time deposits,
certificates of deposit, bankers' acceptances and commercial paper.
In an effort to increase its total return, the Fund may engage in various
investment techniques which, if successful, would produce short-term
capital gains. The use of investment techniques and instruments such as
leveraging, short-selling, options and futures transactions, currency
transactions and lending of portfolio securities involves greater risk than
that incurred by many other funds. Using these techniques may produce
higher than normal portfolio turnover which usually generates additional
brokerage commissions and expenses for the Fund. You should purchase
Fund shares only as a supplement to an overall investment program and
only if you are willing to undertake the risks involved.
INVESTMENT TECHNIQUES
LEVERAGE THROUGH BORROWING - The Fund may borrow for investment
purposes. This borrowing, which is known as leveraging, generally will be
unsecured, except to the extent the Fund enters into reverse repurchase
agreements described below. The Investment Company Act of 1940
requires the Fund to maintain continuous asset coverage (that is, total
assets including borrowings, less liabilities exclusive of borrowings) of
300% of the amount borrowed. If the 300% asset coverage should decline
as a result of market fluctuations or other reasons, the Fund may be
required to sell some of its portfolio holdings within three days to reduce
the debt and restore the 300% asset coverage, even though it may be
disadvantageous from an investment standpoint to sell securities at that
time. Leveraging may exaggerate the effect on net asset value of any
increase or decrease in the market value of the Fund's portfolio. Money
borrowed for leveraging will be subject to interest costs which may or
may not be recovered by appreciation of the securities purchased. The Fund
also may be required to maintain minimum average balances in connection
with such borrowing or to pay a commitment or other fee to maintain a
line of credit; either of these requirements would increase the cost of
borrowing over the stated interest rate.
Among the forms of borrowing in which the Fund may engage is the
entry into reverse repurchase agreements with banks, brokers or dealers.
These transactions involve the transfer by the Fund of an underlying debt
instrument in return for cash proceeds based on a percentage of the value
of the security. The Fund
(5)
retains the right to receive interest and principal payments on the
security. At an agreed upon future date, the Fund repurchases the security
at principal, plus accrued interest. In certain types of agreements, there
is no agreed upon repurchase date and interest payments are calculated
daily, often based on the prevailing overnight repurchase rate. The Fund
will maintain in a segregated custodial account cash, cash equivalents or
U.S. Government securities or other high quality liquid debt securities at
least equal to the aggregate amount of its reverse repurchase obligations,
plus accrued interest, in certain cases, in accordance with releases
promulgated by the Securities and Exchange Commission. The Securities
and Exchange Commission views reverse repurchase transactions as
collateralized borrowings by the Fund. These agreements, which are
treated as if reestablished each day, are expected to provide the Fund with
a flexible borrowing tool.
SHORT-SELLING - The Fund may make short sales, which are
transactions in which the Fund sells a security it does not own in
anticipation of a decline in the market value of that security. To complete
such a transaction, the Fund must borrow the security to make delivery to
the buyer. The Fund then is obligated to replace the security borrowed by
purchasing it at the market price at the time of replacement. The price at
such time may be more or less than the price at which the security was
sold by the Fund. Until the security is replaced, the Fund is required to pay
to the lender amounts equal to any dividends or interest which accrue
during the period of the loan. To borrow the security, the Fund also may be
required to pay a premium, which would increase the cost of the security
sold. The proceeds of the short sale will be retained by the broker, to the
extent necessary to meet margin requirements, until the short position is
closed out.
Until the Fund closes its short position or replaces the borrowed
security, the Fund will: (a) maintain a segregated account, containing cash
or U.S. Government securities, at such a level that (i) the amount
deposited in the account plus the amount deposited with the broker as
collateral will equal the current value of the security sold short and (ii)
the amount deposited in the segregated account plus the amount deposited
with the broker as collateral will not be less than the market value of the
security at the time it was sold short; or (b) otherwise cover its short
position.
The Fund will incur a loss as a result of the short sale if the price of
the security increases between the date of the short sale and the date on
which the Fund replaces the borrowed security. The Fund will realize a
gain if the security declines in price between those dates. This result is
the opposite of what one would expect from a cash purchase of a long
position in a security. The amount of any gain will be decreased, and the
amount of any loss increased, by the amount of any premium or amounts in
lieu of dividends or interest the Fund may be required to pay in connection
with a short sale.
The Fund may purchase call options to provide a hedge against an
increase in the price of a security sold short by the Fund. When the Fund
purchases a call option it has to pay a premium to the person writing the
option and a commission to the broker selling the option. If the option is
exercised by the Fund, the premium and the commission paid may be more
than the amount of the brokerage commission charged if the security were
to be purchased directly. See "Call and Put Options on Specific Securities"
below.
The Fund anticipates that the frequency of short sales will vary
substantially under different market conditions, and it does not intend
that any specified portion of its assets as a matter of practice will be in
short sales. However, no securities will be sold short if, after effect is
given to any such short sale, the total market value of all securities sold
short would exceed 25% of the value of the Fund's net assets.The Fund may
not sell short the securities of any single issuer listed on a national
securities exchange to the extent of more than 5% of the value of the
Fund's net assets. The Fund may not sell short the securities of any class
of an issuer to the extent, at the time of transaction, of more than 5% of
the outstanding securities of that class.
In addition to the short sales discussed above, the Fund may make short
sales "against the box," a transaction in which the Fund enters into a
short sale of a security which the Fund owns. The proceeds of the short
sale are held by a broker until the settlement date at which time the Fund
delivers the security to close the short position. The Fund receives the net
proceeds from the short sale. The Fund at no time will have more than 15%
of the value of its net assets in deposits on short sales against the box.
CALL AND PUT OPTIONS ON SPECIFIC SECURITIES - The Fund may invest up
to 5% of its assets, represented by
(6)
the premium paid, in the purchase of call and put options in respect of
specific securities (or groups or "baskets" of specific securities). The
Fund may write covered call and put option contracts to the extent of 20%
of the value of its net assets at the time such option contracts are
written. A call option gives the purchaser of the option the right to buy,
and obligates the writer to sell, the underlying security or securities at
the exercise price at any time during the option period. Conversely, a put
option gives the purchaser of the option the right to sell, and obligates the
writer to buy, the underlying security or securities at the exercise price
at any time during the option period. A covered call option sold by the
Fund, which is a call option with respect to which the Fund owns the
underlying security or securities, exposes the Fund during the term of the
option to possible loss of opportunity to realize appreciation in the
market price of the underlying security or securities or to possible
continued holding of a security or securities which might otherwise have
been sold to protect against depreciation in the market price thereof. A
covered put option sold by the Fund exposes the Fund during the term of
the option to a decline in price of the underlying security or securities. A
put option sold by the Fund is covered when, among other things, cash or
liquid securities are placed in a segregated account with the Fund's
custodian to fulfill the obligation undertaken.
To close out a position when writing covered options, the Fund may
make a "closing purchase transaction," which involves purchasing an
option on the same security or securities with the same exercise price
and expiration date as the option which it has previously written. To close
out a position as a purchaser of an option, the Fund may make a "closing
sale transaction," which involves liquidating the Fund's position by
selling the option previously purchased. The Fund will realize a profit or
loss from a closing purchase or sale transaction depending upon the
difference between the amount paid to purchase an option and the amount
received from the sale thereof.
The Fund intends to treat options in respect of specific securities that
are not traded on a national securities exchange and the securities
underlying covered call options written by the Fund as illiquid.
The Fund will purchase options only to the extent permitted by the
policies of state securities authorities in states where shares of the
Fund are qualified for offer and sale.
STOCK INDEX OPTIONS - The Fund may purchase and write put and call
options on stock indexes listed on national securities exchanges or traded
in the over-the-counter market as an investment vehicle for the purpose
of realizing its investment objective or for the purpose of hedging its
portfolio. A stock index fluctuates with changes in the market values of
the stocks included in the index.
The effectiveness of purchasing or writing stock index options will
depend upon the extent to which price movements in the Fund's portfolio
correlate with price movements of the stock index selected. Because the
value of an index option depends upon movements in the level of the index
rather than the price of a particular stock, whether the Fund will realize a
gain or loss from the purchase or writing of options on an index depends
upon movements in the level of stock prices in the stock market generally
or, in the case of certain indexes, in an industry or market segment, rather
than movements in the price of a particular stock. Accordingly, successful
use by the Fund of options on stock indexes will be subject to The Dreyfus
Corporation's ability to predict correctly movements in the direction of
the stock market generally or of a particular industry. This requires
different skills and techniques than predicting changes in the price of
individual stocks.
When the Fund writes an option on a stock index, the Fund will place in
a segregated account with its custodian cash or liquid securities in an
amount at least equal to the market value of the underlying stock index
and will maintain the account while the option is open or will otherwise
cover the transaction.
FUTURES TRANSACTIONS - IN GENERAL - The Fund is not a commodity pool.
However, as a substitute for a comparable market position in the
underlying securities and for hedging purposes, the Fund may engage in
futures and options on futures transactions, as described below.
The Fund may trade futures contracts and options on futures contracts
in U.S. domestic markets, such as the Chicago Board of Trade and the
International Monetary Market of the Chicago Mercantile Exchange, or, to
the extent permitted under applicable law, on exchanges located outside
the United States, such as the London International Financial Futures
Exchange and the Sydney Futures Exchange Limited. Foreign mar-
(7)
kets may offer advantages such as trading in commodities that are not
currently traded in the United States or arbitrage possibilities not
available in the United States. Foreign markets, however, may have
greater risk potential than domestic markets. See "Risk Factors - Foreign
Commodity Transactions" below.
The Fund's commodities transactions must constitute bona fide hedging
or other permissible transactions pursuant to regulations promulgated by
the Commodity Futures Trading Commission (the "CFTC"). In addition, the
Fund may not engage in such transactions if the sum of the amount of
initial margin deposits and premiums paid for unexpired commodity
options, other than for bona fide hedging transactions, would exceed 5% of
the liquidation value of the Fund's assets, after taking into account
unrealized profits and unrealized losses on such contracts it has entered
into; provided, however, that in the case of an option that is in-the-money
at the time of purchase, the in-the-money amount may be excluded in
calculating the 5%. Pursuant to regulations and or published positions of
the Securities and Exchange Commission, the Fund may be required to
segregate cash or high quality money market instruments in connection
with its commodities transactions in an amount generally equal to the
value of the underlying commodity. The segregation of such assets will
have the effect of limiting the Fund's ability to otherwise invest those
assets.
Initially, when purchasing or selling futures contracts the Fund will be
required to deposit with its custodian in the broker's name an amount of
cash or cash equivalents up to approximately 10% of the contract amount.
This amount is subject to change by the exchange or board of trade on
which the contract is traded and members of such exchange or board of
trade may impose their own higher requirements. This amount is known as
"initial margin" and is in the nature of a performance bond or good faith
deposit on the contract which is returned to the Fund upon termination of
the futures position, assuming all contractual obligations have been
satisfied. Subsequent payments, known as "variation margin," to and from
the broker will be made daily as the price of the index or securities
underlying the futures contract fluctuates, making the long and short
positions in the futures contract more or less valuable, a process known
as "marking-to-market." At any time prior to the expiration of a futures
contract, the Fund may elect to close the position by taking an opposite
position at the then prevailing price, which will operate to terminate the
Fund's existing position in the contract.
Although the Fund intends to purchase or sell futures contracts only if
there is an active market for such contracts, no assurance can be given
that a liquid market will exist for any particular contract at any
particular time. Many futures exchanges and boards of trade limit the
amount of fluctuation permitted in futures contract prices during a single
trading day. Once the daily limit has been reached in a particular contract,
no trades may be made that day at a price beyond that limit or trading may
be suspended for specified periods during the day. Futures contract prices
could move to the limit for several consecutive trading days with little or
no trading, thereby preventing prompt liquidation of futures positions and
potentially subjecting the Fund to substantial losses. If it is not possible
or the Fund determines not to close a futures position in anticipation of
adverse price movements, the Fund will be required to make daily cash
payments of variation margin. In such circumstances, an increase in the
value of the portion of the portfolio being hedged, if any, may offset
partially or completely losses on the futures contract. However, no
assurance can be given that the price of the securities being hedged will
correlate with the price movements in a futures contract and thus provide
an offset to losses on the futures contract.
In addition, to the extent the Fund is engaging in a futures transaction
as a hedging device, due to the risk of an imperfect correlation between
securities in the Fund's portfolio that are the subject of a hedging
transaction and the futures contract used as a hedging device, it is
possible that the hedge will not be fully effective in that, for example,
losses on the portfolio securities may be in excess of gains on the futures
contract or losses on the futures contract may be in excess of gains on the
portfolio securities that were the subject of the hedge. In futures
contracts based on indexes, the risk of imperfect correlation increases as
the composition of the Fund's portfolio varies from the composition of the
index. In an effort to compensate for the imperfect correlation of
movements in the price of the securities being hedged and movements in
the price of futures contracts, the Fund may buy or sell futures contracts
in a greater or lesser dollar amount than the dollar amount of the
securities being hedged if the historical volatility of the futures contract
has been less or greater than that of the securities.
(8)
Such "over hedging" or "under hedging" may adversely affect the Fund's
net investment results if market movements are not as anticipated when
the hedge is established.
Successful use of futures by the Fund also is subject to The Dreyfus
Corporation's ability to predict correctly movements in the direction of
the market or interest rates. For example, if the Fund has hedged against
the possibility of a decline in the market adversely affecting the value of
securities held in its portfolio and prices increase instead, the Fund will
lose part or all of the benefit of the increased value of securities which it
has hedged because it will have offsetting losses in its futures positions.
In addition, in such situations, if the Fund has insufficient cash, it may
have to sell securities to meet daily variation margin requirements. Such
sales of securities may, but will not necessarily, be at increased prices
which reflect the rising market. The Fund may have to sell securities at a
time when it may be disadvantageous to do so.
An option on a futures contract gives the purchaser the right, in return
for the premium paid, to assume a position in a futures contract (a long
position if the option is a call and a short position if the option is a put)
at a specified exercise price at any time during the option exercise period.
The writer of the option is required upon exercise to assume an offsetting
futures position (a short position if the option is a call and a long position
if the option is a put). Upon exercise of the option, the assumption of
offsetting futures positions by the writer and holder of the option will be
accompanied by delivery of the accumulated cash balance in the writer's
futures margin account which represents the amount by which the market
price of the futures contract, at exercise, exceeds, in the case of a call, or
is less than, in the case of a put, the exercise price of the option on the
futures contract.
Call options sold by the Fund with respect to futures contracts will be
covered by, among other things, entering into a long position in the same
contract at a price no higher than the strike price of the call option, or by
ownership of the instruments underlying, or instruments the prices of
which are expected to move relatively consistently with the instruments
underlying, the futures contract. Put options sold by the Fund with respect
to futures contracts will be covered in the same manner as put options on
specific securities as described above.
STOCK INDEX FUTURES AND OPTIONS ON STOCK INDEX FUTURES - The Fund
may purchase and sell stock index futures contracts and options on stock
index futures contracts.
A stock index future obligates the seller to deliver (and the purchaser
to take) an amount of cash equal to a specific dollar amount times the
difference between the value of a specific stock index at the close of the
last trading day of the contract and the price at which the agreement is
made. No physical delivery of the underlying stocks in the index is made.
With respect to stock indexes that are permitted investments, the Fund
intends to purchase and sell futures contracts on the stock index for
which it can obtain the best price with consideration also given to
liquidity.
The Fund may use stock index futures as a substitute for a comparable
market position in the underlying securities.
There can be no assurance of the Fund's successful use of stock index
futures as a hedging device. In addition to the possibility that there may
be an imperfect correlation, or no correlation at all, between movements
in the stock index future and the portion of the portfolio being hedged, the
price of stock index futures may not correlate perfectly with the
movement in the stock index because of certain market distortions. First,
all participants in the futures market are subject to margin deposit and
maintenance requirements. Rather than meeting additional margin deposit
requirements, investors may close futures contracts through offsetting
transactions which would distort the normal relationship between the
stock index and futures markets. Secondly, from the point of view of
speculators, the deposit requirements in the futures market are less
onerous than margin requirements in the securities market. Therefore,
increased participation by speculators in the futures market also may
cause temporary price distortions. Because of the possibility of price
distortions in the futures market and the imperfect correlation between
movements in the stock index and movements in the price of stock index
futures, a correct forecast of general market trends by The Dreyfus
Corporation still may not result in a successful hedging transaction.
INTEREST RATE FUTURES CONTRACTS AND OPTIONS ON INTEREST RATE
FUTURES CONTRACTS - The Fund may invest in interest rate futures
contracts and options on interest rate futures contracts as a substitute
for a com-
(9)
parable market position and to hedge against adverse movements in
interest rates.
To the extent the Fund has invested in interest rate future contracts or
options on interest rate futures contracts as a substitute for a
comparable market position, the Fund will be subject to the investment
risks of having purchased the securities underlying the contracts.
The Fund may purchase call options on interest rate futures contracts
to hedge against decline in interest rates and may purchase put options on
interest rate futures contracts to hedge its portfolio securities against
the risk of rising interest rates.
The Fund may sell call options on interest rate futures contracts to
partially hedge against declining prices of portfolio securities. If the
futures price at expiration of the option is below the exercise price, the
Fund will retain the full amount of the option premium which provides a
partial hedge against any decline that may have occurred in the Fund's
portfolio holdings. The Fund may sell put options on interest rate futures
contracts to hedge against increasing prices of the securities which are
deliverable upon exercise of the futures contract. If the futures price at
expiration of the option is higher than the exercise price, the Fund will
retain the full amount of the option premium which provides a partial
hedge against any increase in the price of securities which the Fund
intends to purchase. If a put or call option sold by the Fund is exercised,
the Fund will incur a loss which will be reduced by the amount of the
premium it receives. Depending on the degree of correlation between
changes in the value of its portfolio securities and changes in the value of
its futures positions, the Fund's losses from existing options on futures
may to some extent be reduced or increased by changes in the value of its
portfolio securities.
The Fund also may sell options on interest rate futures contracts as
part of closing purchase transactions to terminate its options positions.
No assurance can be given that such closing transactions can be effected
or that there will be a correlation between price movements in the
options on interest rate futures and price movements in the Fund's
portfolio securities which are the subject of the hedge. In addition, the
Fund's purchase of such options will be based upon predictions as to
anticipated interest rate trends, which could prove to be inaccurate.
CURRENCY FUTURES - The Fund may purchase and sell currency futures
contracts. By selling foreign currency futures, the Fund can establish the
number of U.S. dollars it will receive in the delivery month for a certain
amount of a foreign currency. In this way, if the Fund anticipates a decline
of a foreign currency against the U.S. dollar, the Fund can attempt to fix
the U.S. dollar value of some or all of the securities held in its portfolio
that are denominated in that currency. By purchasing foreign currency
futures, the Fund can establish the number of dollars it will be required to
pay for a specified amount of a foreign currency in the delivery month.
Thus, if the Fund intends to buy securities in the future and expects the
U.S. dollar to decline against the relevant foreign currency during the
period before the purchase is effected, the Fund can attempt to fix the
price in U.S. dollars of the securities it intends to acquire.
FOREIGN CURRENCY TRANSACTIONS - The Fund may engage in currency
exchange transactions either on a spot (i.e., cash) basis at the rate
prevailing in the currency exchange market, or through entering into
forward contracts to purchase or sell currencies. A forward currency
exchange contract involves an obligation to purchase or sell a specific
currency at a future date, which must be more than two days from the
date of the contract, at a price set at the time of the contract. These
contracts are entered into in the interbank market conducted directly
between currency traders (typically commercial banks or other financial
institutions) and their customers.
OPTIONS ON FOREIGN CURRENCY - The Fund may purchase and sell call and
put options on foreign currency for the purpose of hedging against changes
in future currency exchange rates. Call options convey the right to buy the
underlying currency at a price which is expected to be lower than the spot
price of the currency at the time the option expires. Put options convey
the right to sell the underlying currency at a price which is anticipated to
be higher than the spot price of the currency at the time the option
expires. The Fund may use foreign currency options under the same
circumstances that it could use currency forward and futures transactions
as described above. See also "Call and Put Options on Specific Securities"
above.
OPTIONS ON SWAPS -- The Fund may purchase cash-settled options on
interest rate swaps, interest rate swaps denominated in foreign currency
and equity index swaps in pursuit of its investment objective. Interest
rate
(10)
swaps involve the exchange by the Fund with another party of their
respective commitments to pay or receive interest (for example, an
exchange of floating-rate payments for fixed-rate payments) denominated
in U.S. dollars or foreign currency. Equity index swaps involve the
exchange by the Fund with another party of cash flows based upon the
performance of an index or a portion of an index of securities which
usually include dividends. A cash-settled option on a swap gives the
purchaser the right, but not the obligation, in return for the premium paid,
to receive an amount of cash equal to the value of the underlying swap as
of the exercise date. These options typically are purchased in privately
negotiated transactions from financial institutions, including securities
brokerage firms.
LENDING PORTFOLIO SECURITIES - From time to time, the Fund may lend
securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain
transactions. Such loans may not exceed 331/3% of the value of the Fund's
total assets. In connection with such loans, the Fund will receive
collateral consisting of cash, U.S. Government securities or irrevocable
letters of credit which will be maintained at all times in an amount equal
to at least 100% of the current market value of the loaned securities. The
Fund can increase its income through the investment of such collateral.
The Fund continues to be entitled to payments in amounts equal to the
interest, dividends or other distributions payable on the loaned security
and receives interest on the amount of the loan. Such loans will be
terminable at any time upon specified notice. The Fund might experience
risk of loss if the institution with which it has engaged in a portfolio loan
transaction breaches its agreement with the Fund.
FUTURE DEVELOPMENTS - The Fund may take advantage of opportunities in
the area of options and futures contracts and options on futures contracts
and any other derivative investment which are not presently contemplated
for use by the Fund or which are not currently available but which may be
developed, to the extent such opportunities are both consistent with the
Fund's investment objective and legally permissible for the Fund. Before
entering into such transactions or making any such investment, the Fund
will provide appropriate disclosure in its prospectus.
CERTAIN PORTFOLIO SECURITIES
CONVERTIBLE SECURITIES - A convertible security is a fixed-income
security, such as a bond or preferred stock, which may be converted at a
stated price within a specified period of time into a specified number of
shares of common stock of the same or different issuer. Convertible
securities are senior to common stock in a corporation's capital
structure, but usually are subordinate to non-convertible debt securities.
While providing a fixed-income stream (generally higher in yield than the
income derivable from common stock but lower than that afforded by a
non-convertible debt security), a convertible security also affords an
investor the opportunity, through its conversion feature, to participate in
the capital appreciation of the common stock into which it is convertible.
In general, the market value of a convertible security is the higher of
its "investment value" (i.e., its value as a fixed-income security) or its
"conversion value" (i.e., the value of the underlying shares of common
stock if the security is converted). As a fixed-income security, the market
value of a convertible security generally increases when interest rates
decline and generally decreases when interest rates rise. However, the
price of a convertible security also is influenced by the market value of
the security's underlying common stock. Thus, the price of a convertible
security generally increases as the market value of the underlying stock
increases, and generally decreases as the market value of the underlying
stock declines. Investments in convertible securities generally entail less
risk than investments in the common stock of the same issuer.
WARRANTS - The Fund may invest up to 2% of its net assets in warrants,
except that this limitation does not apply to warrants acquired in units or
attached to securities. A warrant is an instrument issued by a corporation
which gives the holder the right to subscribe to a specified amount of the
corporation's capital stock at a set price for a specified period of time.
U.S. GOVERNMENT SECURITIES - Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Treasury Bills have initial maturities of one year or less;
Treasury Notes have initial maturities of one
(11)
to ten years; and Treasury Bonds generally have initial maturities of
greater than ten years. Some obligations issued or guaranteed by U.S.
Government agencies and instrumentalities, for example, Government
National Mortgage Association pass-through certificates, are supported by
the full faith and credit of the U.S. Treasury; others, such as those of the
Federal Home Loan Banks, by the right of the issuer to borrow from the
Treasury; others, such as those issued by the Federal National Mortgage
Association, by discretionary authority of the U.S. Government to purchase
certain obligations of the agency or instrumentality; and others, such as
those issued by the Student Loan Marketing Association, only by the credit
of the agency or instrumentality. These securities bear fixed, floating or
variable rates of interest. Principal and interest may fluctuate based on
generally recognized reference rates or the relationship of rates. While
the U.S. Government provides financial support to such U.S. Government-
sponsored agencies and instrumentalities, no assurance can be given that
it will always do so since it is not so obligated by law. The Fund will
invest in such securities only when it is satisfied that the credit risk
with respect to the issuer is minimal.
ZERO COUPON U.S. TREASURY SECURITIES - The Fund may invest in zero
coupon U.S. Treasury securities, which are Treasury Notes and Bonds that
have been stripped of their unmatured interest coupons, the coupons
themselves and receipts or certificates representing interests in such
stripped debt obligations and coupons. The Fund also may invest in zero
coupon securities issued by corporations and financial institutions which
constitute a proportionate ownership of the issuer's pool of underlying
U.S. Treasury securities. A zero coupon security pays no interest to its
holder during its life and is sold at a discount to its face value at
maturity. The amount of the discount fluctuates with the market price of
the security. The market prices of zero coupon securities generally are
more volatile than the market prices of securities that pay interest
periodically and are likely to respond to a greater degree to changes in
interest rates than non-zero coupon securities having similar maturities
and credit qualities.
REPURCHASE AGREEMENTS - Repurchase agreements involve the
acquisition by the Fund of an underlying debt instrument, subject to an
obligation of the seller to repurchase, and the Fund to resell, the
instrument at a fixed price, usually not more than one week after its
purchase. The Fund's custodian or subcustodian will have custody of, and
will hold in a segregated account, securities acquired by the Fund under a
repurchase agreement. Repurchase agreements are considered by the staff
of the Securities and Exchange Commission to be loans by the Fund. In an
attempt to reduce the risk of incurring a loss on a repurchase agreement,
the Fund will enter into repurchase agreements only with domestic banks
with total assets in excess of one billion dollars or primary government
securities dealers reporting to the Federal Reserve Bank of New York, with
respect to securities of the type in which the Fund may invest, and will
require that additional securities be deposited with it if the value of the
securities purchased should decrease below resale price. The Dreyfus
Corporation will monitor on an ongoing basis the value of the collateral to
assure that it always equals or exceeds the repurchase price. Certain
costs may be incurred by the Fund in connection with the sale of the
securities if the seller does not repurchase them in accordance with the
repurchase agreement. In addition, if bankruptcy proceedings are
commenced with respect to the seller of the securities, realization on the
securities by the Fund may be delayed or limited. The Fund will consider
on an ongoing basis the creditworthiness of the institutions with which it
enters into repurchase agreements.
BANK OBLIGATIONS - Time deposits are non-negotiable deposits
maintained in a banking institution for a specified period of time (in no
event longer than seven days) at a stated interest rate. Time deposits
which may be held by the Fund will not benefit from insurance from the
Bank Insurance Fund or the Savings Association Insurance Fund
administered by the Federal Deposit Insurance Corporation.
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period
of time.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the face
amount of the instrument upon maturity. The other short-term obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
(12)
COMMERCIAL PAPER - Commercial paper consists of short-term, unsecured
promissory notes issued to finance short-term credit needs. The
commercial paper purchased by the Fund will consist only of direct
obligations which, at the time of their purchase, are (a) rated not lower
than Prime-l by Moody's or A-1 by Standard & Poor's, (b) issued by
companies having an outstanding unsecured debt issue currently rated at
least Aa3 by Moody's or AA- by Standard & Poor's, or (c) if unrated,
determined by The Dreyfus Corporation to be of comparable quality to
those rated obligations which may be purchased by the Fund.
ILLIQUID SECURITIES - The Fund may invest up to 15% of the value of its
net assets in securities as to which a liquid trading market does not
exist, provided such investments are consistent with the Fund's
investment objective. Such securities may include securities that are not
readily marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, repurchase agreements providing for
settlement in more than seven days after notice, and certain options
traded in the over-the-counter market and securities used to cover such
options. As to these securities, the Fund is subject to a risk that should
the Fund desire to sell them when a ready buyer is not available for a
price the Fund deems representative of their value, the value of the Fund's
net assets could be adversely affected. When purchasing securities that
have not been registered under the Securities Act of 1933, as amended,
and are not readily marketable, the Fund will endeavor to obtain the right
to register them at the expense of the issuer. Generally, there will be a
lapse of time between the Fund's decision to sell any such security and
the registration of the security permitting sale. During any such period,
the price of the securities will be subject to market fluctuations.
However, if a substantial market of qualified institutional buyers
develops pursuant to Rule 144A under the Securities Act of 1933, as
amended, for certain unregistered securities held by the Fund, the Fund
intends to treat such securities as liquid securities in accordance with
procedures approved by the Fund's Board of Trustees. Because it is not
possible to predict with assurance how the market for restricted
securities pursuant to Rule 144A will develop, the Fund's Board of
Trustees has directed The Dreyfus Corporation to monitor carefully the
Fund's investments in such securities with particular regard to trading
activity, availability of reliable price information and other relevant
information. To the extent that, for a period of time, qualified
institutional buyers cease purchasing restricted securities pursuant to
Rule 144A, the Fund's investing in such securities may have the effect of
increasing the level of illiquidity in the Fund's portfolio during such
period.
CERTAIN FUNDAMENTAL POLICIES - The Fund may: (i) purchase securities
of any company having less than three years' continuous operation
(including operations of any predecessors) if such purchase does not cause
the value of the Fund's investments in all such companies to exceed 5% of
the value of its assets; (ii) borrow money and pledge, mortgage and
hypothecate its assets, but only as stated in this Prospectus and the
Fund's Statement of Additional Information; and (iii) invest up to 25% of
its total assets in securities of issuers in a single industry, provided
that, when the Fund has adopted a temporary defensive posture, there
shall be no limitation on investments in securities issued or guaranteed
by the U.S. Government, its agencies or instrumentalities. This paragraph
describes fundamental policies that cannot be changed without approval
by the holders of a majority (as defined in the Investment Company Act of
1940) of the Fund's outstanding voting shares. See "Investment Objective
and Management Policies - Investment Restrictions" in the Fund's
Statement of Additional Information.
RISK FACTORS
LOWER RATED SECURITIES - You should carefully consider the relative
risks of investing in the higher yielding (and, therefore, higher risk) debt
securities in which the Fund may invest when management believes that
such securities offer opportunities for capital growth. These are
securities such as those rated Ba by Moody's or BB by Standard & Poor's or
as low as those rated Caa by Moody's or CCC by Standard & Poor's. They
generally are not meant for short-term investing and may be subject to
certain risks with respect to the issuing entity and to greater market
fluctuations than certain lower yielding, higher rated fixed-income
securities. Securities rated Ba by Moody's are judged to have speculative
elements; their future cannot be considered as well assured and often the
protection of interest and principal payments may be very moderate.
Securities rated BB by Standard & Poor's are regarded as having
predominantly speculative characteristics and, while such securities have
less
(13)
near-term vulnerability to default than other speculative grade debt, they
face major ongoing uncertainties or exposure to adverse business,
financial or economic conditions which could lead to inadequate capacity
to meet timely interest and principal payments. Securities rated Caa by
Moody's are of poor standing and may be in default or there may be present
elements of danger with respect to principal or interest. Standard &
Poor's typically assigns a CCC rating to debt which has a currently
identifiable vulnerability to default and is dependent upon favorable
business, financial and economic conditions to meet timely payments of
interest and repayment of principal. Such obligations, though high
yielding, are characterized by great risk. See "Appendix" in the Fund's
Statement of Additional Information for a general description of Moody's
and Standard & Poor's ratings of debt obligations. The ratings of Moody's
and Standard & Poor's represent their opinions as to the quality of the
securities which they undertake to rate. It should be emphasized, however,
that ratings are relative and subjective and, although ratings may be
useful in evaluating the safety of interest and principal payments, they do
not evaluate the market value risk of these securities. Therefore, although
these ratings may be an initial criterion for selection of portfolio
investments, The Dreyfus Corporation also will evaluate these securities
and the ability of the issuers of such securities to pay interest and
principal. The Fund's ability to achieve its investment objective may be
more dependent on The Dreyfus Corporation's credit analysis than might be
the case for a fund that invests in higher rated securities. Once the rating
of a portfolio security has been changed, the Fund will consider all
circumstances deemed relevant in determining whether to continue to hold
the security.
The market price and yield of bonds rated Ba or lower by Moody's and BB
or lower by Standard & Poor's are more volatile than those of higher rated
bonds. Factors adversely affecting the market price and yield of these
securities will adversely affect the Fund's net asset value. In addition,
the retail secondary market for these bonds may be less liquid than that
of higher rated bonds; adverse conditions could make it difficult at times
for the Fund to sell certain securities or could result in lower prices than
those used in calculating the Fund's net asset value.
The market values of certain lower rated debt securities tend to reflect
individual corporate developments to a greater extent than do higher rated
securities, which react primarily to fluctuations in the general level of
interest rates, and tend to be more sensitive to economic conditions than
are higher rated securities. Companies that issue such bonds often are
highly leveraged and may not have available to them more traditional
methods of financing. Therefore, the risk associated with acquiring the
securities of such issuers generally is greater than is the case with
higher rated securities.
The Fund may invest in zero coupon securities and pay-in-kind bonds
(bonds which pay interest through the issuance of additional bonds) rated
as low as Caa by Moody's and as low as CCC by Standard & Poor's, which
involve special considerations. These securities may be subject to greater
fluctuations in value due to changes in interest rates than interest-
bearing securities and thus may be considered more speculative than
comparably rated interest-bearing securities. See "Other Investment
Considerations" below and "Investment Objective and Management
Policies - Risk Factors - Lower Rated Securities" and "Dividends,
Distributions and Taxes" in the Fund's Statement of Additional
Information.
INVESTING IN FOREIGN SECURITIES - In making foreign investments, the
Fund will give appropriate consideration to the following factors, among
others.
Foreign securities markets generally are not as developed or efficient
as those in the United States. Securities of some foreign issuers are less
liquid and more volatile than securities of comparable U.S. issuers.
Similarly, volume and liquidity in most foreign securities markets are
less than in the United States and, at times, volatility of price can be
greater than in the United States. The issuers of some of these securities,
such as foreign bank obligations, may be subject to less stringent or
different regulations than are U.S. issuers. In addition, there may be less
publicly available information about a non-U.S. issuer, and non-U.S. issuers
generally are not subject to uniform accounting and financial reporting
standards, practices and requirements comparable to those applicable to
U.S. issuers.
Because stock certificates and other evidences of ownership of such
securities usually are held outside the United States, the Fund will be
subject to additional risks which include possible adverse political and
economic developments, possible seizure or nationalization of foreign
deposits and possible adoption of governmental
(14)
restrictions which might adversely affect the payment of principal and
interest on the foreign securities or might restrict the payment of
principal and interest to investors located outside the country of the
issuer, whether from currency blockage or otherwise. Custodial expenses
for a portfolio of non-U.S. securities generally are higher than for a
portfolio of U.S. securities.
Since foreign securities often are purchased with and payable in
currencies of foreign countries, the value of these assets as measured in
U.S. dollars may be affected favorably or unfavorably by changes in
currency rates and exchange control regulations. Some currency exchange
costs may be incurred when the Fund changes investments from one
country to another.
Furthermore, some of these securities may be subject to brokerage
taxes levied by foreign governments, which have the effect of increasing
the cost of such investment and reducing the realized gain or increasing
the realized loss on such securities at the time of sale. Income received
by the Fund from sources within foreign countries may be reduced by
withholding and other taxes imposed by such countries. Tax conventions
between certain countries and the United States, however, may reduce or
eliminate such taxes. All such taxes paid by the Fund will reduce its net
income available for distribution to investors.
Distributions paid by the Fund to corporate investors do not qualify for
the dividends received deduction to the extent that the distributions are
attributable to amounts received by the Fund as dividends on foreign
securities.
FOREIGN CURRENCY EXCHANGE - Currency exchange rates may fluctuate
significantly over short periods of time. They generally are determined by
the forces of supply and demand in the foreign exchange markets and
relative merits of investments in different countries, actual or perceived
changes in interest rates and other complex factors, as seen from an
international perspective. Currency exchange rates also can be affected
unpredictably by intervention by U.S. or foreign governments or central
banks or the failure to intervene or by currency controls or political
developments in the U.S. or abroad.
The foreign currency market offers less protection against defaults in
the forward trading of currencies than is available when trading in
currencies occurs on an exchange. Since a forward currency contract is not
guaranteed by an exchange or clearinghouse, a default on the contract
would deprive the Fund of unrealized profits or force the Fund to cover its
commitments for purchase or resale, if any, at the current market price.
FOREIGN COMMODITY TRANSACTIONS - Unlike trading on domestic
commodity exchanges, trading on foreign commodity exchanges is not
regulated by the CFTC and may be subject to greater risks than trading on
domestic exchanges. For example, some foreign exchanges are principal
markets so that no common clearing facility exists and a trader may look
only to the broker for performance of the contract. In addition, unless the
Fund hedges against fluctuations in the exchange rate between the U.S.
dollar and the currencies in which the trading is done on foreign
exchanges, any profits that the Fund might realize in trading could be
eliminated by adverse changes in the exchange rate, or the Fund could
incur losses as a result of those changes. Transactions on foreign
exchanges may include both commodities which are traded on domestic
exchanges and those which are not.
OTHER INVESTMENT CONSIDERATIONS - Even though interest-bearing
securities are investments which promise a stable stream of income, the
prices of such securities are inversely affected by changes in interest
rates and, therefore, are subject to the risk of market price fluctuations.
The values of fixed-income securities also may be affected by changes in
the credit rating or financial condition of the issuing entities. See "Lower
Rated Securities" above.
Securities purchased by the Fund often are offered on a when-issued
basis, which means that delivery and payment take place a number of days
after the date of the commitment to purchase. The payment obligation and
the interest rate that will be received on a when-issued security are fixed
at the time the Fund enters into the commitment. The Fund will make
commitments to purchase such securities only with the intention of
actually acquiring the securities, but the Fund may sell these securities
before the settlement date if it is deemed advisable. The Fund will not
accrue income in respect of a when-issued security prior to its stated
delivery date.
Securities purchased on a when-issued basis and certain other
securities held in the Fund's portfolio are subject to changes in value
(both generally changing in the same way, i.e., appreciating when interest
rates decline and depreciating when interest rates rise) based upon the
public's perception of the creditworthiness of the issuer and changes, real
or anticipated, in the level of interest rates. Securities purchased on a
when-issued
(15)
basis may expose the Fund to risks because they may experience such
fluctuations prior to their actual delivery. Purchasing securities on a
when-issued basis can involve the additional risk that the yield available
in the market when the delivery takes place actually may be higher than
that obtained in the transaction itself. A segregated account of the Fund
consisting of cash, cash equivalents or U.S. Government securities or other
high quality liquid debt securities at least equal at all times to the
amount of the when-issued commitments will be established and
maintained at the Fund's custodian bank. Purchasing securities on a when-
issued basis when the Fund is fully or almost fully invested may result in
greater potential fluctuation in the value of the Fund's net assets and its
net asset value per share.
Federal income tax law requires the holder of a zero coupon security or
of certain pay-in-kind bonds to accrue income with respect to these
securities prior to the receipt of cash payments. To maintain its
qualification as a regulated investment company and avoid liability for
Federal income taxes, the Fund may be required to distribute such income
accrued to these securities and may have to dispose of portfolio
securities under disadvantageous circumstances in order to generate cash
to satisfy these distribution requirements.
The Fund's ability to engage in certain short-term transactions may be
limited by the requirement that, to qualify as a regulated investment
company, the Fund must earn less than 30% of its gross income from the
disposition of securities held for less than three months. This 30% test
limits the extent to which the Fund may sell securities held for less than
three months, effect short sales of securities held for less than three
months, write options expiring in less than three months and invest in
certain futures contracts, among other strategies. However, portfolio
turnover will not otherwise be a limiting factor in making investment
decisions, and the Fund's investment policies may result in portfolio
turnover greater than that of other investment companies. High portfolio
turnover rates are likely to result in comparatively greater brokerage
commissions.
The Fund's classification as a "non-diversified" investment company
means that the proportion of the Fund's assets that may be invested in the
securities of a single issuer is not limited by the Investment Company Act
of 1940. A "diversified investment company" is required by the
Investment Company Act of 1940 generally, with respect to 75% of its
total assets, to invest not more than 5% of such assets in the securities
of a single issuer and to hold not more than 10% of the voting securities
of any single issuer. However, the Fund intends to conduct its operations
so as to qualify as a "regulated investment company" for purposes of the
Internal Revenue Code of 1986, as amended (the "Code"), which requires
that, at the end of each quarter of its taxable year, (i) at least 50% of the
market value of the Fund's total assets be invested in cash, U.S.
Government securities, the securities of other regulated investment
companies and other securities, with such other securities of any one
issuer limited for the purposes of this calculation to an amount not
greater than 5% of the value of the Fund's total assets and 10% of the
outstanding voting securities of such issuer, and (ii) not more than 25% of
the value of its total assets be invested in the securities of any one
issuer (other than U.S. Government securities or the securities of other
regulated investment companies). Since a relatively high percentage of the
Fund's assets may be invested in the obligations of a limited number of
issuers, some of which may be within the same economic sector, the
Fund's portfolio securities may be more susceptible to any single
economic, political or regulatory occurrence than the portfolio securities
of a diversified investment company.
Investment decisions for the Fund are made independently from those of
the other investment companies advised by The Dreyfus Corporation.
However, if such other investment companies are prepared to invest in, or
desire to dispose of, securities of the type in which the Fund invests at
the same time as the Fund, available investments or opportunities for
sales will be allocated equitably to each investment company. In some
cases, this procedure may adversely affect the size of the position
obtained for or disposed of by the Fund or the price paid or received by the
Fund.
MANAGEMENT OF THE FUND
The Dreyfus Corporation, located at 200 Park Avenue, New York, New
York 10166, was formed in 1947 and serves as the Fund's investment
adviser. As of December 31, 1993, The Dreyfus Corporation managed or
administered approximately $78 billion in assets for more than 1.9
million investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a
(16)
Management Agreement with the Fund, subject to the overall authority of
the Fund's Trustees in accordance with Massachusetts law. The Fund's
primary investment officer is Richard C. Shields. He has held that position
since August 1988 and has been employed by The Dreyfus Corporation
since 1979. The Fund's other investment officers are identified under
"Management of the Fund" in the Fund's Statement of Additional
Information. The Dreyfus Corporation also provides research services for
the Fund as well as for other funds advised by The Dreyfus Corporation
through a professional staff of portfolio managers and security analysts.
For the fiscal year ended October 31, 1993, the Fund paid The Dreyfus
Corporation a monthly fee at the annual rate of .75 of 1% of the value of
the Fund's average daily net assets. From time to time, The Dreyfus
Corporation may waive receipt of its fees and/or voluntarily assume
certain expenses of the Fund, which would have the effect of lowering the
Fund's overall expense ratio and increasing yield to investors at the time
such amounts are waived or assumed, as the case may be. The Fund will
not pay The Dreyfus Corporation at a later time for any amounts it may
waive, nor will the Fund reimburse The Dreyfus Corporation for any
amounts it may assume. The management fee is higher than that paid by
most other investment companies. The Dreyfus Corporation may pay
Dreyfus Service Corporation for shareholder and distribution services
from its own monies, including past profits but not including the
management fee paid by the Fund. Dreyfus Service Corporation may pay
part or all of these payments to securities dealers or others for servicing
and distribution.
The Shareholder Services Group, Inc., a subsidiary of First Data
Corporation, P.O. Box 9671, Providence, Rhode Island 02940-9671, is the
Fund's Transfer and Dividend Disbursing Agent (the "Transfer Agent"). The
Bank of New York, 110 Washington Street, New York, New York 10286, is
the Fund's Custodian.
HOW TO BUY FUND SHARES
The Fund's distributor is Dreyfus Service Corporation, a wholly-owned
subsidiary of The Dreyfus Corporation, located at 200 Park Avenue, New
York, New York 10166. The shares it distributes are not deposits or
obligations of The Dreyfus Security Savings Bank, F.S.B. and therefore are
not insured by the Federal Deposit Insurance Corporation.
Fund shares can be purchased through Dreyfus Service Corporation or
certain financial institutions, securities dealers and other industry
professionals (collectively, "Service Agents") that have entered into
agreements with Dreyfus Service Corporation. Service Agents may receive
different levels of compensation for selling different Classes of shares.
Management understands that some Service Agents may impose certain
conditions on their clients which are different from those described in
this Prospectus, and, to the extent permitted by applicable regulatory
authority, may charge their clients direct fees which would be in addition
to any amounts which might be received under the Shareholder Service
Plan. Each Service Agent has agreed to transmit to its clients a schedule
of such fees. You should consult your Service Agent in this regard.
When purchasing Fund shares, you must specify whether the purchase is
for Class A or Class B shares. Share certificates are issued only upon your
written request. No certificates are issued for fractional shares. The Fund
reserves the right to reject any purchase order.
The minimum initial investment is $2,500, or $1,000 if you are a client
of a Service Agent which has made an aggregate minimum initial purchase
for its customers of $2,500. Subsequent investments must be at least
$500. The initial investment must be accompanied by the Fund's Account
Application. For full-time or part-time employees of The Dreyfus
Corporation or any of its affiliates or subsidiaries, directors of The
Dreyfus Corporation, Board members of a fund advised by The Dreyfus
Corporation, including members of the Fund's Board, or the spouse or
minor child of any of the foregoing, the minimum initial investment is
$1,000. For full-time or part-time employees of The Dreyfus Corporation
or any of its affiliates or subsidiaries who elect to have a portion of their
pay directly deposited into their Fund account, the minimum initial
investment is $50. The Fund reserves the right to offer Fund shares
without regard to minimum purchase requirements to employees
participating in certain qualified and non-qualified employee benefit plans
or other programs where contributions or account information can be
transmitted in a manner and form acceptable to the Fund. The Fund
(17)
reserves the right to vary further the initial and subsequent investment
minimum requirements at any time.
You may purchase Fund shares by check or wire, or through the Dreyfus
TELETRANSFER Privilege described below. Checks should be made payable
to "The Dreyfus Family of Funds," or, if for Dreyfus retirement plan
accounts, to "The Dreyfus Trust Company, Custodian." Payments to open
new accounts which are mailed should be sent to The Dreyfus Family of
Funds, P.O. Box 9387, Providence, Rhode Island 02940-9387, together with
your Account Application indicating which Class of shares is being
purchased. For subsequent investments, your Fund account number should
appear on the check and an investment slip should be enclosed and sent to
The Dreyfus Family of Funds, P.O. Box 105, Newark, New Jersey 07101-
0105. For Dreyfus retirement plan accounts, both initial and subsequent
investments should be sent to The Dreyfus Trust Company, Custodian, P.O.
Box 6427, Providence, Rhode Island 02940-6427. Neither initial nor
subsequent investments should be made by third party check. Purchase
orders may be delivered in person only to a Dreyfus Financial Center.
THESE ORDERS WILL BE FORWARDED TO THE FUND AND WILL BE PROCESSED
ONLY UPON RECEIPT THEREBY. For the location of the nearest Dreyfus
Financial Center, please call one of the telephone numbers listed under
"General Information."
Wire payments may be made if your bank account is in a commercial bank
that is a member of the Federal Reserve System or any other bank having a
correspondent bank in New York City. Immediately available funds may be
transmitted by wire to The Bank of New York, DDA #8900119365/Dreyfus
Strategic Investing - Class A shares, or DDA #8900115165/Dreyfus
Strategic Investing - Class B shares, as the case may be, for purchase of
Fund shares in your name. The wire must include your Fund account number
(for new accounts, your Taxpayer Identification Number ("TIN") should be
included instead), account registration and dealer number, if applicable. If
your initial purchase of Fund shares is by wire, please call 1-800-645-
6561 after completing your wire payment to obtain your Fund account
number. Please include your Fund account number on the Fund's Account
Application and promptly mail the Account Application to the Fund, as no
redemptions will be permitted until the Account Application is received.
You may obtain further information about remitting funds in this manner
from your bank. All payments should be made in U.S. dollars and, to avoid
fees and delays, should be drawn only on U.S. banks. A charge will be
imposed if any check used for investment in your account does not clear.
The Fund makes available to certain large institutions the ability to issue
purchase instructions through compatible computer facilities.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct
the institution to transmit immediately available funds through the
Automated Clearing House to The Bank of New York with instructions to
credit your Fund account. The instructions must specify your Fund account
registration and your Fund account number PRECEDED BY THE DIGITS
"1111."
Fund shares are sold on a continuous basis. Net asset value per share is
determined as of the close of trading on the New York Stock Exchange
(currently 4:00 p.m., New York time), on each day the New York Stock
Exchange is open for business. For purposes of determining net asset
value, options and futures contracts will be valued 15 minutes after the
close of trading on the New York Stock Exchange. Net asset value per share
of each Class is computed by dividing the value of the Fund's net assets
represented by such Class (i.e., the value of its assets less liabilities) by
the total number of shares of such Class outstanding. The Fund's
investments are valued based on market value or, where market quotations
are not readily available, based on fair value as determined in good faith
by the Board of Trustees. For further information regarding the methods
employed in valuing Fund investments, see "Determination of Net Asset
Value" in the Fund's Statement of Additional Information.
Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes"
and the Fund's Account Application for further information concerning this
requirement. Failure to furnish a certified TIN to the Fund could subject
you to a $50 penalty imposed by the Internal Revenue Service ("IRS").
If an order is received by the Transfer Agent or other agent by the close
of trading on the New York Stock Exchange (currently 4:00 p.m., New York
time) on a business day, Fund shares will be purchased at the public
(18)
offering price determined as of the close of trading on the New York Stock
Exchange on that day. Otherwise, Fund shares will be purchased at the
public offering price determined as of the close of trading on the New York
Stock Exchange on the next business day, except where shares are
purchased through a dealer as provided below.
Orders for the purchase of Fund shares received by the close of trading
on the floor of the New York Stock Exchange on a business day and
transmitted to Dreyfus Service Corporation by the close of its business
day (normally 5:15 p.m., New York time) will be based on the public
offering price per share determined as of the close of trading on the New
York Stock Exchange on that day. Otherwise, the orders will be based on
the next determined public offering price. It is the dealers' responsibility
to transmit orders so that they will be received by Dreyfus Service
Corporation before the close of its business day.
CLASS A SHARES-The public offering price for Class A shares is the net
asset value per share of that Class plus a sales load as shown below:
<TABLE>
<CAPTION>
Total Sales Load
---------------------------------
As a % of As a % of Dealers' Reallowance
offering price net asset value as a % of
Amount of Transaction per share per share offering price
- --------------------- -------------- --------------- --------------------
<S> <C> <C> <C>
Less than $50,000................. 4.50 4.70 4.25
$50,000 to less than $100,000..... 4.00 4.20 3.75
$100,000 to less than $250,000.... 3.00 3.10 2.75
$250,000 to less than $500,000.... 2.50 2.60 2.25
$500,000 to less than $1,000,000.. 2.00 2.00 1.75
$1,000,000 to less than $3,000,000 1.00 1.00 1.00
$3,000,000 to less than $5,000,000 .50 .50 .50
$5,000,000 and over............... .25 .25 .25
</TABLE>
Full-time employees of NASD member firms and full-time employees of
other financial institutions which have entered into an agreement with
Dreyfus Service Corporation pertaining to the sale of Fund shares (or
which otherwise have a brokerage related or clearing arrangement with an
NASD member firm or financial institution with respect to the sale of
Fund shares) may purchase Class A shares for themselves, directly or
pursuant to an employee benefit plan or other program, or for their
spouses and minor children at net asset value, provided that they have
furnished Dreyfus Service Corporation with such information that it may
request from time to time in order to verify eligibility for this privilege.
This privilege also applies to full-time employees of financial
institutions affiliated with NASD member firms whose full-time
employees are eligible to purchase Class A shares at net asset value. In
addition, Class A shares are offered at net asset value to full-time or
part-time employees of The Dreyfus Corporation or any of its affiliates or
subsidiaries, directors of The Dreyfus Corporation, Board members of a
fund advised by The Dreyfus Corporation, including members of the Fund's
Board, or the spouse or minor child of any of the foregoing.
Class A shares will be offered at net asset value without a sales load
to employees participating in qualified or non-qualified employee benefit
plans or other programs where (i) the employers or affiliated employers
maintaining such plans or programs have a minimum of 250 employees
eligible for participation in such plans or programs or (ii) such plan's or
program's aggregate initial investment in the Dreyfus Family of Funds or
certain other products made available by Dreyfus Service Corporation to
such plans or programs exceeds one million dollars ("Eligible Benefit
Plans"). The determination of the number of employees eligible for
participation in such a plan or program shall be made on the date that
Class A shares are first purchased by or on behalf of employees
participating in such plan or program and on each subsequent January 1st.
Dreyfus Service Corporation may pay dealers a fee of up to .5% of the
amount invested through such dealers in Class A shares at net asset value
by employees participating in Eligible Benefit Plans. All present holdings
of shares of funds in the Dreyfus Family of Funds by Eligible Benefit Plans
will be aggregated to determine the fee payable with respect to each such
purchase of Class A shares. Dreyfus Service Corporation reserves the right
to cease paying these fees at any time. Dreyfus Service Corporation will
pay such fees from its own funds, other than amounts
(19)
received from the Fund, including past profits or any other source
available to it.
Class A shares also may be purchased (including by exchange) at net
asset value without a sales load for Dreyfus-sponsored IRA "Rollover
Accounts" with the distribution proceeds from a qualified retirement plan
or a Dreyfus-sponsored 403(b)(7) plan, provided that, at the time of such
distribution, such qualified retirement plan or Dreyfus-sponsored
403(b)(7) plan (a) satisfied the requirements set forth under either clause
(i) or clause (ii) in the preceding paragraph and all or a portion of such
plan's assets were invested in funds in the Dreyfus Family of Funds or
certain other products made available by Dreyfus Service Corporation to
such plans, or (b) invested all of its assets in certain funds in the Dreyfus
Family of Funds or certain other products made available by Dreyfus
Service Corporation to such plans.
In fiscal 1993, Dreyfus Service Corporation retained $561,439 from
sales loads on Class A shares. The dealer reallowance may be changed
from time to time but will remain the same for all dealers. Dreyfus
Service Corporation, at its expense, may provide additional promotional
incentives to dealers that sell shares of funds advised by The Dreyfus
Corporation which are sold with a sales load, such as the Fund. In some
instances, these incentives may be offered only to certain dealers who
have sold or may sell significant amounts of shares. Dealers receive a
larger percentage of the sales load from Dreyfus Service Corporation than
they receive for selling most other funds.
CLASS B SHARES - The public offering price for Class B shares is the net
asset value per share of that Class. No initial sales charge is imposed at
the time of purchase. A CDSC is imposed, however, on certain redemptions
of Class B shares as described under "How to Redeem Fund Shares."
Dreyfus Service Corporation compensates certain Service Agents for
selling Class B shares at the time of purchase from Dreyfus Service
Corporation's own assets. The proceeds of the CDSC and the distribution
fee, in part, are used to defray these expenses. In fiscal 1993, $18,382
was retained by Dreyfus Service Corporation from the CDSC on Class B
shares.
RIGHT OF ACCUMULATION - CLASS A SHARES - Reduced sales loads may
apply to any purchase of Class A shares, shares of certain other funds
advised by The Dreyfus Corporation which are sold with a sales load and
shares acquired by a previous exchange of shares purchased with a sales
load (hereinafter referred to as "Eligible Funds"), by you and any related
"purchaser" as defined in the Statement of Additional Information, where
the aggregate investment, including such purchase, is $50,000 or more. If,
for example, you previously purchased and still hold Class A shares of the
Fund, or of any other Eligible Fund, or combination thereof, with an
aggregate current market value of $40,000 and subsequently purchase
Class A shares of the Fund having a current value of $20,000, the sales
load applicable to the subsequent purchase would be reduced to 4% of the
offering price. All present holdings of Eligible Funds may be combined to
determine the current offering price of the aggregate investment in
ascertaining the sales load applicable to each subsequent purchase.
To qualify for reduced sales loads, at the time of a purchase you or your
Service Agent must notify Dreyfus Service Corporation if orders are made
by wire, or the Transfer Agent if orders are made by mail. The reduced
sales load is subject to confirmation of your holdings through a check of
appropriate records.
DREYFUS TELETRANSFER PRIVILEGE - You may purchase Fund shares
(minimum $500, maximum $150,000 per day) by telephone if you have
checked the appropriate box and supplied the necessary information on the
Fund's Account Application or have filed an Optional Services Form with
the Transfer Agent. The proceeds will be transferred between the bank
account designated in one of these documents and your Fund account. Only
such a bank account maintained in a domestic financial institution which
is an Automated Clearing House member may be so designated. The Fund
may modify or terminate this Privilege at any time or charge a service fee
upon notice to shareholders. No such fee currently is contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER purchase of Fund shares by telephoning
1-800-221-4060 or, if you are calling from overseas, call 1-401-455-
3306.
(20)
SHAREHOLDER SERVICES
The services and privileges described under this heading may not be
available to clients of certain Service Agents and some Service Agents
may impose certain conditions on their clients which are different from
those described in this Prospectus. You should consult your Service Agent
in this regard.
EXCHANGE PRIVILEGE - The Exchange Privilege enables you to purchase, in
exchange for Class A or Class B shares of the Fund, shares of the same
Class in certain other funds managed or administered by The Dreyfus
Corporation, to the extent such shares are offered for sale in your state of
residence. These Funds may have different investment objectives which
may be of interest to you. The Exchange Privilege may be exercised two
times during the calendar year as described below. If you desire to use
this Privilege, you should consult your Service Agent or Dreyfus Service
Corporation to determine if it is available and whether any other
conditions are imposed on its use.
To use this Privilege, you or your Service Agent acting on your behalf
must give exchange instructions to the Transfer Agent in writing, by wire
or by telephone. If you previously established the Telephone Exchange
Privilege, you may telephone exchange instructions by calling 1-800-221-
4060 or, if you are calling from overseas, call 1-401-455-3306. See "How
to Redeem Fund Shares - Procedures." Before any exchange, you must
obtain and should review a copy of the current prospectus of the fund into
which the exchange is being made. Prospectuses may be obtained from
Dreyfus Service Corporation. The shares being exchanged must have a
current value of at least $500; furthermore, when establishing a new
account by exchange, the shares being exchanged must have a value of at
least the minimum initial investment required for the fund into which the
exchange is being made. Telephone exchanges may be made only if the
appropriate "YES" box has been checked on the Account Application, or a
separate signed Optional Services Form is on file with the Transfer Agent.
Upon an exchange into a new account, the following shareholder services
and privileges, as applicable and where available, will be automatically
carried over to the fund into which the exchange is made: Exchange
Privilege, Dreyfus TELETRANSFER Privilege and the dividend/capital gain
distributions option (except for the Dreyfus Dividend Sweep Privilege)
selected by the investor.
Shares will be exchanged at the next determined net asset value;
however, a sales load may be charged with respect to exchanges of Class
A shares into funds sold with a sales load. No CDSC will be imposed on
Class B shares at the time of an exchange; however, Class B shares
acquired through an exchange will be subject on redemption to the higher
CDSC applicable to the exchanged or acquired shares. The CDSC applicable
on redemption of the acquired Class B shares will be calculated from the
date of the initial purchase of the Class B shares exchanged. If you are
exchanging Class A shares into a fund that charges a sales load, you may
qualify for share prices which do not include the sales load or which
reflect a reduced sales load, if the shares of the fund from which you are
exchanging were: (a) purchased with a sales load, (b) acquired by a
previous exchange from shares purchased with a sales load, or (c) acquired
through reinvestments of dividends or distributions paid with respect to
the foregoing categories of shares. To qualify, at the time of your
exchange you must notify the Transfer Agent or your Service Agent must
notify Dreyfus Service Corporation. Any such qualification is subject to
confirmation of your holdings through a check of appropriate records. See
"Shareholder Services" in the Fund's Statement of Additional Information.
No fees currently are charged shareholders directly in connection with
exchanges, although the Fund reserves the right, upon not less than 60
days' written notice, to charge shareholders a nominal fee in accordance
with rules promulgated by the Securities and Exchange Commission. The
Fund reserves the right to reject any exchange request in whole or in part.
The Exchange Privilege may be modified or terminated at any time upon
notice to shareholders.
With respect to any investor who has exchanged into and out of the Fund
(or the reverse) twice during the calendar year, further purchase orders
(including those pursuant to exchange instructions) relating to any shares
of the Fund will be rejected for the remainder of the calendar year.
Management believes that this policy will enable shareholders to change
their investment program, while protecting the Fund against disruptions
in portfolio management resulting from frequent transactions by those
seeking to time market fluctuations. Exchanges
(21)
made through omnibus accounts for various retirement plans are not
subject to such limit on exchanges.
The exchange of shares of one fund for shares of another is treated for
Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
DREYFUS AUTO-EXCHANGE PRIVILEGE - Dreyfus Auto-Exchange Privilege
permits you to invest regularly (on a semi-monthly, monthly, quarterly or
annual basis), in exchange for Class A or Class B shares of the Fund, in
shares of the same class of certain other funds in the Dreyfus Family of
Funds of which you are currently an investor. The amount you designate,
which can be expressed either in terms of a specific dollar or share
amount ($100 minimum), will be exchanged automatically on the first and
or fifteenth of the month according to the schedule you have selected.
Shares will be exchanged at the then-current net asset value; however, a
sales load may be charged with respect to exchanges of Class A shares
into funds sold with a sales load. No CDSC will be imposed on Class B
shares at the time of an exchange; however, Class B shares acquired
through an exchange will be subject on redemption to the higher CDSC
applicable to the exchanged or acquired shares. The CDSC applicable on
redemption of the acquired Class B shares will be calculated from the
date of the initial purchase of the Class B shares exchanged. See
"Shareholder Services" in the Statement of Additional Information. This
Privilege may be modified or canceled by the Fund or the Transfer Agent.
You may modify or cancel your exercise of this Privilege at any time by
writing to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode
Island 02940-9671. The Fund may charge a service fee for this Privilege.
No such fee currently is contemplated. The exchange of shares of one fund
for shares of another is treated for Federal income tax purposes as a sale
of the shares given in exchange by the shareholder and, therefore, an
exchanging shareholder may realize a taxable gain or loss. Thus, you may
realize a taxable gain or loss. For more information concerning this
Privilege and the funds in the Dreyfus Family of Funds eligible to
participate in this Privilege, or to obtain a Dreyfus Auto-Exchange
Authorization Form, please call toll free 1-800-645-6561.
DREYFUS-AUTOMATIC ASSET BUILDER - Dreyfus-AUTOMATIC Asset Builder
permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund
shares are purchased by transferring funds from the bank account
designated by you. At your option, the bank account designated by you will
be debited in the specified amount, and Fund shares will be purchased,
once a month, on either the first or fifteenth day, or twice a month, on
both days. Only an account maintained at a domestic financial institution
which is an Automated Clearing House member may be so designated. To
establish a Dreyfus-AUTOMATIC Asset Builder account, you must file an
authorization form with the Transfer Agent. You may obtain the necessary
authorization form from Dreyfus Service Corporation. You may cancel your
participation in this Privilege or change the amount of purchase at any
time by mailing written notification to The Dreyfus Family of Funds, P.O.
Box 6527, Providence, Rhode Island 02940-6527, or, if for Dreyfus
Retirement Plan accounts, to The Dreyfus Trust Company, Custodian, P.O.
Box 6427, Providence, Rhode Island 02940-6427, and the notification will
be effective three business days following receipt. The Fund may modify
or terminate this Privilege at any time or charge a service fee. No such
fee currently is contemplated.
AUTOMATIC WITHDRAWAL PLAN - The Automatic Withdrawal Plan permits
you to request withdrawal of a specified dollar amount (minimum of $50)
on either a monthly or quarterly basis if you have a $5,000 minimum
account. An application for the Automatic Withdrawal Plan can be obtained
from Dreyfus Service Corporation. There is a service charge of 50 cents for
each withdrawal check. The Automatic Withdrawal Plan may be ended at
any time by you, the Fund or the Transfer Agent. Shares for which
certificates have been issued may not be redeemed through the Automatic
Withdrawal Plan.
Class B shares withdrawn pursuant to the Automatic Withdrawal Plan
will be subject to any applicable CDSC. Any correspondence with respect
to the Automatic Withdrawal Plan should be addressed to The Dreyfus
Family of Funds, P.O. Box 6527, Providence, Rhode Island 02940-6527, or,
if for Dreyfus retirement plan accounts, to The Dreyfus Trust Company,
Custodian, P.O. Box 6427, Providence, Rhode Island 02940-6427.
DREYFUS DIVIDEND SWEEP PRIVILEGE - Dreyfus Dividend Sweep Privilege
enables you to invest automatically dividends or dividends and capital
gain distributions, if any, paid by the Fund in shares of the same Class of
(22)
another fund in the Dreyfus Family of Funds of which you are an investor.
Shares of the other fund will be purchased at the then-current net asset
value; however, a sales load may be charged with respect to investments
in shares of a fund sold with a sales load. If you are investing in a fund
that charges a sales load, you may qualify for share prices which do not
include the sales load or which reflect a reduced sales load. If you are
investing in a fund or class that charges a CDSC, the shares purchased will
be subject on redemption to the CDSC, if any, applicable to the purchased
shares. See "Shareholder Services" in the Statement of Additional
Information. For more information concerning this Privilege and the funds
in the Dreyfus Family of Funds eligible to participate in this Privilege, or
to request a Dividend Sweep Authorization Form, please call toll free
1-800-645-6561. You may cancel this Privilege by mailing written
notification to The Dreyfus Family of Funds, P.O. Box 9671, Providence,
Rhode Island 02940-9671. To select a new fund after cancellation, you
must submit a new authorization form. Enrollment in or cancellation of
this Privilege is effective three business days following receipt. This
Privilege is available only for existing accounts and may not be used to
open new accounts. Minimum subsequent investments do not apply. The
Fund may modify or terminate this Privilege at any time or charge a
service fee. No such fee currently is contemplated. Shares held under
Keogh Plans, IRAs or other retirement plans are not eligible for this
Privilege.
DREYFUS PAYROLL SAVINGS PLAN - Dreyfus Payroll Savings Plan permits
you to purchase Fund shares (minimum of $100 per transaction)
automatically on a regular basis. Depending upon your employer's direct
deposit program, you may have part or all of your paycheck transferred to
your existing Dreyfus account electronically through the Automated
Clearing House system at each pay period. To establish a Dreyfus Payroll
Savings Plan account, you must file an authorization form with your
employer's payroll department. Your employer must complete the reverse
side of the form and return it to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671. You may obtain the necessary
authorization form from Dreyfus Service Corporation. You may change the
amount of purchase or cancel the authorization only by written
notification to your employer. It is the sole responsibility of your
employer, not Dreyfus Service Corporation, The Dreyfus Corporation, the
Fund, the Transfer Agent or any other person, to arrange for transactions
under Dreyfus Payroll Savings Plan. The Fund may modify or terminate this
Privilege at any time or charge a service fee. No such fee currently is
contemplated.
RETIREMENT PLANS - The Fund offers a variety of pension and profit-
sharing plans, including Keogh Plans, IRAs, SEP-IRAs and IRA "Rollover
Accounts," 401(k) Salary Reduction Plans and 403(b)(7) Plans. Plan
support services also are available. For details, please contact Dreyfus
Group Retirement Plans, a division of Dreyfus Service Corporation, by
calling toll free 1-800-358-5566.
LETTER OF INTENT - CLASS A SHARES - By signing a Letter of Intent form,
available from Dreyfus Service Corporation, you become eligible for the
reduced sales load applicable to the total number of Eligible Fund shares
purchased in a 13-month period pursuant to the terms and under the
conditions set forth in the Letter of Intent. A minimum initial purchase of
$5,000 is required. To compute the applicable sales load, the offering
price of shares you hold (on the date of submission of the Letter of Intent)
in any Eligible Fund that may be used toward "Right of Accumulation"
benefits described above may be used as a credit toward completion of the
Letter of Intent. However, the reduced sales load will be applied only to
new purchases.
The Transfer Agent will hold in escrow 5% of the amount indicated in
the Letter of Intent for payment of a higher sales load if you do not
purchase the full amount indicated in the Letter of Intent. The escrow will
be released when you fulfill the terms of the Letter of Intent by
purchasing the specified amount. If your purchases qualify for a further
sales load reduction, the sales load will be adjusted to reflect your total
purchase at the end of 13 months. If total purchases are less than the
amount specified, you will be requested to remit an amount equal to the
difference between the sales load actually paid and the sales load
applicable to the aggregate purchases actually made. If such remittance is
not received within 20 days, the Transfer Agent, as attorney-in-fact
pursuant to the terms of the Letter of Intent, will redeem an appropriate
number of Class A shares held in escrow to realize the difference. Signing
a Letter of Intent does not bind you to purchase, or the Fund to sell, the
full amount indicated at the sales load in effect at the time of signing,
but you must complete the intended pur-
(23)
chase to obtain the reduced sales load. At the time you purchase Class
A shares, you must indicate your intention to do so under a Letter of
Intent. Purchases pursuant to a Letter of Intent will be made at the then-
current net asset value plus the applicable sales load in effect at the time
such Letter of Intent was executed.
HOW TO REDEEM FUND SHARES
GENERAL - You may request redemption of your Class A or Class B shares
at any time. Redemption requests should be transmitted to the Transfer
Agent as described below. When a request is received in proper form, the
Fund will redeem the shares at the next determined net asset value as
described below. If you hold Fund shares of more than one Class, any
request for redemption must specify the Class of shares being redeemed.
If you fail to specify the Class of shares to be redeemed or if you own
fewer shares of the Class than specified to be redeemed, the redemption
request may be delayed until the Transfer Agent receives further
instructions from you or your Service Agent.
The Fund imposes no charges (other than any applicable CDSC) when
shares are redeemed directly through Dreyfus Service Corporation. Service
Agents may charge a nominal fee for effecting redemptions of Fund shares.
Any certificates representing Fund shares being redeemed must be
submitted with the redemption request. The value of the shares redeemed
may be more or less than their original cost, depending on the Fund's then-
current net asset value.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and
Exchange Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY
CHECK, BY DREYFUS TELETRANSFER OR THROUGH DREYFUS-AUTOMATIC ASSET
BUILDER AND SUBSEQUENTLY SUBMIT A WRITTEN REDEMPTION REQUEST TO THE
TRANSFER AGENT, THE REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU
PROMPTLY UPON BANK CLEARANCE OF YOUR PURCHASE CHECK, DREYFUS
TELETRANSFER PURCHASE OR DREYFUS-AUTOMATIC ASSET BUILDER ORDER, WHICH
MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, THE FUND WILL
REJECT REQUESTS TO REDEEM SHARES PURSUANT TO THE DREYFUS TELETRANSFER
PRIVILEGE FOR A PERIOD OF EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER
AGENT OF THE PURCHASE CHECK, THE DREYFUS TELETRANSFER PURCHASE OR THE
DREYFUS-AUTOMATIC ASSET BUILDER ORDER AGAINST WHICH SUCH REDEMPTION IS
REQUESTED. THESE PROCEDURES WILL NOT APPLY IF YOUR SHARES WERE PURCHASED
BY WIRE PAYMENT, OR IF YOU OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE
IN YOUR ACCOUNT TO COVER THE REDEMPTION REQUEST. PRIOR TO THE TIME ANY
REDEMPTION IS EFFECTIVE, DIVIDENDS ON SUCH SHARES WILL ACCRUE AND BE
PAYABLE, AND YOU WILL BE ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL
OWNERSHIP. Fund shares will not be redeemed until the Transfer Agent has
received your Account Application.
The Fund reserves the right to redeem your account at its option upon
not less than 30 days' written notice if your account's net asset value is
$500 or less and remains so during the notice period.
CONTINGENT DEFERRED SALES CHARGE - CLASS B SHARES - A CDSC payable
to Dreyfus Service Corporation is imposed on any redemption by a
shareholder of Class B shares which reduces the current net asset value of
your Class B shares to an amount which is lower than the dollar amount of
all payments by you for the purchase of Class B shares of the Fund held by
you at the time of redemption. No CDSC will be imposed to the extent that
the net asset value of the Class B shares redeemed does not exceed (i) the
current net asset value of Class B shares acquired through reinvestment
of dividends or capital gain distributions, plus (ii) increases in the net
asset value of your Class B shares above the dollar amount of all your
payments for the purchase of Class B shares of the Fund held by you at the
time of redemption.
If the aggregate value of the Class B shares redeemed has declined
below their original cost as a result of the Fund's performance, a CDSC
may be applied to the then-current net asset value rather than the
purchase price.
In circumstances where the CDSC is imposed, the amount of the charge
will depend on the number of years from the time you purchased the Class
B shares until the time of redemption of such shares. Solely for purposes
of determining the number of years from the time of any payment for the
purchase of Class B shares, all payments during a month will be
aggregated and deemed to have been made on the first day of the month.
(24)
The following table sets forth the rates of the CDSC:
Payment Was Made CDSC as a % of Amount
Year Since Purchase Invested or Redemption Proceeds
- ------------------- -------------------------------
First.............................. 4.00
Second............................. 4.00
Third.............................. 3.00
Fourth............................. 3.00
Fifth.............................. 2.00
Sixth.............................. 1.00
In determining whether a CDSC is applicable to a redemption, the
calculation will be made in a manner that results in the lowest possible
rate. It will be assumed that the redemption is made first of amounts
representing shares acquired pursuant to the reinvestment of dividends
and distributions; then of amounts representing the increase in net asset
value of Class B shares above the total amount of payments for the
purchase of Class B shares made during the preceding six years; then of
amounts representing the cost of shares purchased six years prior to the
redemption; and finally, of amounts representing the cost of shares held
for the longest period of time within the applicable six-year period.
For example, assume an investor purchased 100 shares at $10 per share
for a cost of $1,000. Subsequently, the shareholder acquired 5 additional
shares through dividend reinvestment. During the second year after the
purchase the investor decided to redeem $500 of his or her investment.
Assuming at the time of the redemption the net asset value had
appreciated to $12 per share, the value of the investor's shares would be
$1,260 (105 shares at $12 per share). The CDSC would not be applied to
the value of the reinvested dividend shares and the amount which
represents appreciation ($260). Therefore, $240 of the $500 redemption
proceeds ($500 minus $260) would be charged at a rate of 4% (the
applicable rate on the second year after purchase) for a total CDSC of
$9.60.
WAIVER OF CDSC - The CDSC will be waived in connection with (a)
redemptions made within one year after the death or disability, as defined
in Section 72(m)(7) of the Code, of the shareholder, (b) redemptions by
Eligible Benefit Plans, (c) redemptions as a result of a combination of any
investment company with the Fund by merger, acquisition of assets or
otherwise, (d) a distribution following retirement under a tax-deferred
retirement plan or upon attaining age 701/2 in the case of an IRA or Keogh
plan or custodial account pursuant to Section 403(b) of the Code and (e)
redemptions by such shareholders as the Securities and Exchange
Commission or its staff may permit. If the Trustees of the Fund determine
to discontinue the waiver of the CDSC, the disclosure in the Fund's
prospectus will be appropriately revised. Any Fund shares subject to a
CDSC which were purchased prior to the termination of such waiver will
have the CDSC waived as provided in the Fund's prospectus at the time of
the purchase of such shares.
To qualify for a waiver of the CDSC, at the time of redemption you must
notify the Transfer Agent or your Service Agent must notify Dreyfus
Service Corporation. Any such qualification is subject to confirmation of
your entitlement.
PROCEDURES - You may redeem Fund shares by using the regular
redemption procedure through the Transfer Agent or through the Dreyfus
TELETRANSFER Privilege. Other redemption procedures may be in effect
for investors who effect transactions in Fund shares through Service
Agents. The Fund makes available to certain large institutions the ability
to issue redemption instructions through compatible computer facilities.
In addition, Dreyfus Service Corporation will accept orders from
dealers with which it has sales agreements for the repurchase of shares
held by shareholders. Repurchase orders received by the dealer prior to the
close of trading on the floor of the New York Stock Exchange on a business
day and transmitted to Dreyfus Service Corporation prior to the close of
its business day (normally 5:15 p.m., New York time) are effected at the
price determined as of the close of trading on the floor of the New York
Stock Exchange on that day. Otherwise, the shares will be redeemed at the
next determined net asset value. It is the responsibility of the dealer to
transmit orders on a timely basis. The dealer may charge the shareholder a
fee for executing the
(25)
order. This repurchase arrangement is discretionary and may be withdrawn
at any time.
Your redemption request may direct that the redemption proceeds be
used to purchase shares of other funds advised or administered by The
Dreyfus Corporation that are not available through the Exchange Privilege.
The applicable CDSC will be charged upon the redemption of Class B
shares. Your redemption proceeds will be invested in shares of the other
fund on the next business day. Before you make such a request, you must
obtain and should review a copy of the current prospectus of the fund
being purchased. Prospectuses may be obtained from Dreyfus Service
Corporation. The prospectus will contain information concerning minimum
investment requirements and other conditions that may apply to your
purchase.
You may redeem or exchange Fund shares by telephone if you have
checked the appropriate box on the Fund's Account Application or have
filed an Optional Services Form with the Transfer Agent. If you select the
Dreyfus TELETRANSFER Privilege or telephone exchange privilege, you
authorize the Transfer Agent to act on telephone instructions from any
person representing himself or herself to be you, or a representative of
your Service Agent, and reasonably believed by the Transfer Agent to be
genuine. The Fund will require the Transfer Agent to employ reasonable
procedures, such as requiring a form of personal identification, to confirm
that instructions are genuine and, if it does not follow such procedures,
the Fund or the Transfer Agent may be liable for any losses due to
unauthorized or fraudulent instructions. Neither the Fund nor the Transfer
Agent will be liable for following telephone instructions reasonably
believed to be genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a Dreyfus TELETRANSFER redemption or exchange of Fund shares.
In such cases, you should consider using the other redemption procedures
described herein. Use of these other redemption procedures may result in
your redemption request being processed at a later time than it would
have been if Dreyfus TELETRANSFER redemption had been used. During the
delay, the Fund's net asset value may fluctuate.
REGULAR REDEMPTION - Under the regular redemption procedure, you may
redeem shares by written request mailed to The Dreyfus Family of Funds,
P.O. Box 6527, Providence, Rhode Island 02940-6527. Redemption requests
on Dreyfus Retirement Plan accounts should be sent to The Dreyfus Trust
Company, Custodian, P.O. Box 6427, Providence, Rhode Island 02940-6427.
Written redemption requests must specify the Class of shares being
redeemed. Redemption requests may be delivered in person only to a
Dreyfus Financial Center. THESE REQUESTS WILL BE FORWARDED TO THE
FUND AND WILL BE PROCESSED ONLY UPON RECEIPT THEREBY. For the
location of the nearest Dreyfus Financial Center, please call one of the
telephone numbers listed under "General Information." Redemption
requests must be signed by each shareholder, including each owner of a
joint account, and each signature must be guaranteed. The Transfer Agent
has adopted standards and procedures pursuant to which signature-
guarantees in proper form generally will be accepted from domestic
banks, brokers, dealers, credit unions, national securities exchanges,
registered securities associations, clearing agencies and savings
associations, as well as from participants in the New York Stock Exchange
Medallion Signature Program, the Securities Transfer Agents Medallion
Program ("STAMP"), and the Stock Exchanges Medallion Program. If you
have any questions with respect to signature-guarantees, please call one
of the telephone numbers listed under "General Information."
Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.
DREYFUS TELETRANSFER PRIVILEGE - You may redeem Fund shares
(minimum $500 per day) by telephone if you have checked the appropriate
box and supplied the necessary information on the Fund's Account
Application or have filed an Optional Services Form with the Transfer
Agent. Class B shares redeemed through the Dreyfus TELETRANSFER
Privilege will be subject to the appropriate CDSC. The proceeds will be
transferred between your Fund account and the bank account designated in
one of these documents. Only such a bank account maintained in a domestic
financial institution which is an Automated Clearing House member may
be so designated. Redemption proceeds will be on deposit in your account
at an Automated Clearing House member bank ordinarily two days after
receipt of the redemption request or, at your request, paid by check
(maximum $150,000 per day) and mailed to your address. Holders of
jointly registered Fund or
(26)
bank accounts may redeem through the Dreyfus TELETRANSFER Privilege
for transfer to their bank account only up to $250,000 within any 30-day
period. The Fund reserves the right to refuse any request made by
telephone, including requests made shortly after a change of address, and
may limit the amount involved or the number of such requests. The Fund
may modify or terminate this Privilege at any time or charge a service fee
upon notice to shareholders. No such fee currently is contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER redemption of Fund shares by telephoning
1-800-221-4060 or, if you are calling from overseas, call 1-401-455-
3306. Shares held under Keogh Plans, IRAs or other retirement plans, and
shares issued in certificate form, are not eligible for this Privilege.
REINVESTMENT PRIVILEGE - CLASS A - You may reinvest up to the number
of Class A shares you have redeemed, within 30 days of redemption, at the
then-prevailing net asset value without a sales load, or reinstate your
account for the purpose of exercising the Exchange Privilege. The
Reinvestment Privilege may be exercised only once.
DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN
The Class A and Class B shares are subject to a Shareholder Services
Plan and the Class B shares only are subject to a Distribution Plan.
DISTRIBUTION PLAN - Under the Distribution Plan, adopted pursuant to
Rule 12b-1 under the Investment Company Act of 1940, the Fund pays
Dreyfus Service Corporation for advertising, marketing and distributing
Class B shares at an annual rate of .75 of 1% of the value of the average
daily net assets of Class B. Under the Distribution Plan, Dreyfus Service
Corporation may make payments to Service Agents in respect of these
services. Dreyfus Service Corporation determines the amounts to be paid
to Service Agents. Service Agents receive such fees in respect of the
average daily value of Class B shares owned by their clients. From time to
time, Dreyfus Service Corporation may defer or waive receipt of fees
under the Distribution Plan while retaining the ability to be paid by the
Fund under the Distribution Plan thereafter. The fees payable to Dreyfus
Service Corporation under the Distribution Plan for advertising, marketing
and distributing Class B shares and payments to Service Agents are
payable without regard to actual expenses incurred.
SHAREHOLDER SERVICES PLAN - Under the Shareholder Services Plan, the
Fund pays Dreyfus Service Corporation for the provision of certain
services to the holders of Class A and Class B shares a fee at the annual
rate of .25 of 1% of the value of the average daily net assets of Class A
and Class B. The services provided may include personal services relating
to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. Dreyfus
Service Corporation may make payments to Service Agents in respect of
these services. Dreyfus Service Corporation determines the amounts to be
paid to Service Agents. Each Service Agent is required to disclose to its
clients any compensation payable to it by the Fund pursuant to the
Shareholder Services Plan and any other compensation payable by their
clients in connection with the investment of their assets in Class A or
Class B shares.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund ordinarily pays dividends from net investment income and
distributes net realized securities gains, if any, once a year, but it may
make distributions on a more frequent basis to comply with the
distribution requirements of the Code, in all events in a manner consistent
with the provisions of the Investment Company Act of 1940. The Fund will
not make distributions from net realized securities gains unless capital
loss carryovers, if any, have been utilized or have expired. You may choose
whether to receive distributions in cash or to reinvest such amounts in
additional Fund shares of the same Class at net asset value without a
sales load. All expenses are accrued daily and deducted before declaration
of dividends. Dividends paid by each Class will be calculated at the same
time and in the same manner and will be of the same amount, except that
the expenses attributable solely to Class A or Class B will be borne
exclusively by such Class. Class B shares will receive lower per share
dividends than Class A shares because of the higher expenses borne by
Class B. See "Fee Table."
(27)
Dividends derived from net investment income, together with
distributions from any net realized short-term securities gains and gains
from the sale or other disposition of market discount bonds, paid by the
Fund, are subject to Federal income tax as ordinary income whether
received in cash or reinvested in fund shares. Distributions from net
realized long-term securities gains of the Fund, if any, generally are
taxable as long-term capital gains for Federal income tax purposes if the
shareholder is a citizen or resident of the United States, whether such
distributions are received in cash or reinvested in Fund shares. The Code
provides that the net capital gain of an individual will not be subject to
Federal income tax at a rate in excess of 28%. Dividends and distributions
also may be subject to state and local taxes.
Dividends derived from net investment income, together with
distributions from net realized short-term securities gains and gains
from the sale or other disposition of market discount bonds, paid by the
Fund to a foreign investor generally are subject to U.S. nonresident
withholding taxes at the rate of 30%, unless the foreign investor claims
the benefit of a lower rate specified in a tax treaty. Distributions from
net realized long-term securities gains paid by the Fund to a foreign
investor as well as the proceeds of any redemptions from a foreign
investor's account, regardless of the extent to which gain or loss may be
realized, generally will not be subject to U.S. nonresident withholding tax.
However, such distributions may be subject to backup withholding, as
described below, unless the foreign investor certifies his non-U.S.
residency status.
Notice as to the tax status of your dividends and distributions is mailed
to you annually. You also will receive periodic summaries of your account
which will include information as to income dividends and distributions
from securities gains, if any, paid during the year. Depending upon the
composition of the Fund's income, a portion of the dividends from net
investment income may qualify for the dividends received deduction
allowable to certain U.S. corporations.
The Code provides for the "carryover" of some or all of the sales load
imposed on Class A shares, if you exchange your Class A shares for shares
of another fund advised by The Dreyfus Corporation within 91 days of
purchase and such other fund reduces or eliminates its otherwise
applicable sales load charge for the purpose of the exchange. In this case,
the amount of your sales load charge for Class A shares, up to the amount
of the reduction of the sales load charge on the exchange, is not included
in the basis of your Class A shares for purposes of computing gain or loss
on the exchange, and instead is added to the basis of the fund shares
received on the exchange.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of dividends,
distributions from net realized securities gains and the proceeds of any
redemption, regardless of the extent to which gain or loss may be
realized, paid to a shareholder if such shareholder fails to certify either
that the TIN furnished in connection with opening an account is correct, or
that such shareholder has not received notice from the IRS of being
subject to backup withholding as a result of a failure to properly report
taxable dividend or interest income on a Federal income tax return.
Furthermore, the IRS may notify the Fund to institute backup withholding
if the IRS determines that a shareholder's TIN is incorrect or if a
shareholder has failed to properly report dividend and interest income on
such shareholder's Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Management of the Fund believes that the Fund qualified for the fiscal
year ended October 31, 1993 as a "regulated investment company" under
the Code. The Fund intends to continue to so qualify if such qualification
is in the best interests of its shareholders. Qualification as a regulated
investment company relieves the Fund of any liability for Federal income
taxes to the extent its earnings are distributed in accordance with
applicable provisions of the Code. In addition, the Fund is subject to a non-
deductible 4% excise tax, measured with respect to certain undistributed
amounts of taxable income and capital gains.
You should consult your tax adviser regarding specific questions as to
Federal, state and local taxes.
(28)
PERFORMANCE INFORMATION
For purposes of advertising, performance for each Class of shares will
be calculated on the basis of average annual total return. Advertisements
may also include performance calculated on the basis of total return.
These total return figures reflect changes in the price of the shares and
assume that any income dividends and or capital gains distributions made
by the Fund during the measuring period were reinvested in shares of the
same Class. Class A total return figures include the maximum initial sales
charge and Class B total return figures include any applicable CDSC. These
figures also take into account any applicable service and distribution fees.
As a result, at any given time, the performance of Class B should be
expected to be lower than that of Class A. Performance for each Class will
be calculated separately.
Average annual total return is calculated pursuant to a standardized
formula which assumes that an investment in the Fund was purchased
with an initial payment of $1,000 and that the investment was redeemed
at the end of a stated period of time, after giving effect to the
reinvestment of dividends and distributions during the period. The return
is expressed as a percentage rate which, if applied on a compounded
annual basis, would result in the redeemable value of the investment at
the end of the period. Advertisements of the Fund's performance will
include the average annual total return of Class A and Class B for one, five
and ten year periods, or for shorter time periods depending upon the length
of time during which the Fund has operated.
Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the
income and principal changes for a specified period and dividing by the
maximum offering price per share at the beginning of the period.
Advertisements may include the percentage rate of total return or may
include the value of a hypothetical investment at the end of the period
which assumes the application of the percentage rate of total return.
Total return may also be calculated by using the net asset value per share
at the beginning of the period instead of the maximum offering price per
share at the beginning of the period for Class A shares or without giving
effect to any applicable CDSC at the end of the period for Class B shares.
Calculations based on the net asset value per share do not reflect the
deduction of the applicable sales charge which, if reflected, would reduce
the performance quoted.
Performance will vary from time to time and past results are not
necessarily representative of future results. You should remember that
performance is a function of portfolio management in selecting the type
and quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a
basis for comparison with other investments or other investment
companies using a different method of calculating performance.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., Standard & Poor's 500 Composite Stock Price
Index, the Dow Jones Industrial Average, Morningstar, Inc. and other
industry publications.
GENERAL INFORMATION
The Fund was organized as an unincorporated business trust under the
laws of the Commonwealth of Massachusetts pursuant to an Agreement
and Declaration of Trust (the "Trust Agreement") dated July 24, 1985, and
commenced operations on October 1, 1986. The Fund is authorized to issue
an unlimited number of shares of beneficial interest, par value $.001 per
share. The Fund's shares are classified into two classes. Each share has
one vote and shareholders will vote in the aggregate and not by class
except as otherwise required by law or when class voting is permitted by
the Board of Trustees. Holders of Class A and Class B shares, however,
will be entitled to vote on matters submitted to shareholders pertaining
to the Shareholder Service Plan and only holders of Class B shares will be
entitled to vote on matters submitted to shareholders pertaining to the
Distribution Plan.
Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of the Fund.
However, the Trust Agreement disclaims shareholder liability for acts or
obligations of the Fund and requires that notice of such disclaimer be
given in each agreement, obligation or instru-
(29)
ment entered into or executed by the Fund or a Trustee. The Trust
Agreement provides for indemnification from the Fund's property for all
losses and expenses of any shareholder personally held liable for the
obligations of the Fund. Thus, the risk of a shareholder's incurring
financial loss on account of shareholder liability is limited to
circumstances in which the Fund itself would be unable to meet its
obligations, a possibility which management believes is remote. Upon
payment of any liability incurred by the Fund, the shareholder paying such
liability will be entitled to reimbursement from the general assets of the
Fund. The Trustees intend to conduct the operations of the Fund in such a
way so as to avoid, as far as possible, ultimate liability of the
shareholders for liabilities of the Fund. As described under "Management
of the Fund" in the Fund's Statement of Additional Information, the Fund
ordinarily will not hold shareholder meetings; however, shareholders
under certain circumstances may have the right to call a meeting of
shareholders for the purpose of voting to remove Trustees.
The Transfer Agent maintains a record of your ownership and sends you
confirmations and statements of account.
Shareholder inquiries may be made by writing to the Fund at 144 Glenn
Curtiss Boulevard, Uniondale, New York 11556-0144, or by calling toll
free 1-800-645-6561. In New York City, call 1-718-895-1206; on Long
Island, call 794-5200.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY
PERSON TO WHOM, SUCH OFFERING MAY NOT LAWFULLY BE MADE.
(30)
DREYFUS STRATEGIC INVESTING
CLASS A AND CLASS B SHARES
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
JANUARY 28, 1994
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus Strategic Investing (the "Fund"), dated January 28, 1994, as it
may be revised from time to time. To obtain a copy of the Fund's
Prospectus, please write to the Fund at 144 Glenn Curtiss Boulevard,
Uniondale, New York 11556-0144, or call the following numbers:
Outside New York State -- Call Toll Free 1-800-645-6561
In New York City -- Call 1-718-895-1206
(Outside New York City -- Call Collect)
On Long Island -- Call 794-5200
The Dreyfus Corporation (the "Manager") serves as the Fund's
investment adviser.
Dreyfus Service Corporation (the "Distributor"), a wholly-owned
subsidiary of the Manager, is the distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies. . . . . . . . B-2
Management of the Fund. . . . . . . . . . . . . . . . . . . B-9
Management Agreement. . . . . . . . . . . . . . . . . . . . B-12
Purchase of Fund Shares . . . . . . . . . . . . . . . . . . B-14
Distribution Plan and Shareholder Services Plan . . . . . . B-15
Redemption of Fund Shares . . . . . . . . . . . . . . . . . B-17
Shareholder Services. . . . . . . . . . . . . . . . . . . . B-18
Determination of Net Asset Value. . . . . . . . . . . . . . B-21
Dividends, Distributions and Taxes. . . . . . . . . . . . . B-22
Portfolio Transactions. . . . . . . . . . . . . . . . . . . B-23
Performance Information . . . . . . . . . . . . . . . . . . B-24
Information About the Fund. . . . . . . . . . . . . . . . . B-25
Custodian, Transfer and Dividend Disbursing Agent, Counsel
and Independent Auditors. . . . . . . . . . . . . . . B-26
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . B-27
Financial Statements. . . . . . . . . . . . . . . . . . . . B-32
Report of Independent Auditors. . . . . . . . . . . . . . . B-46
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Description
of the Fund."
Management Policies
The Fund engages in the following practices in furtherance of its
objective.
Options Transactions. The Fund may engage in options transactions,
such as purchasing or writing covered call or put options. The principal
reason for writing covered call options is to realize, through the receipt
of premiums, a greater return than would be realized on the Fund's
portfolio securities alone. In return for a premium, the writer of a
covered call option forfeits the right to any appreciation in the value of
the underlying security above the strike price for the life of the option
(or until a closing purchase transaction can be effected). Nevertheless,
the call writer retains the risk of a decline in the price of the
underlying security. Similarly, the principal reason for writing covered
put options is to realize income in the form of premiums. The writer of a
covered put option accepts the risk of a decline in the price of the
underlying security. The size of the premiums that the Fund may receive
may be adversely affected as new or existing institutions, including other
investment companies, engage in or increase their option-writing
activities.
Options written ordinarily will have expiration dates between one and
nine months from the date written. The exercise price of the options may
be below, equal to or above the market values of the underlying securities
at the times the options are written. In the case of call options, these
exercise prices are referred to as "in-the-money," "at-the-money" and
"out-of-the-money," respectively. The Fund may write (a) in-the-money call
options when the Manager expects that the price of the underlying security
will remain stable or decline moderately during the option period, (b)
at-the-money call options when the Manager expects that the price of the
underlying security will remain stable or advance moderately during the
option period and (c) out-of-the-money call options when the Manager
expects that the premiums received from writing the call option plus the
appreciation in market price of the underlying security up to the exercise
price will be greater than the appreciation in the price of the underlying
security alone. In these circumstances, if the market price of the
underlying security declines and the security is sold at this lower price,
the amount of any realized loss will be offset wholly or in part by the
premium received. Out-of-the-money, at-the-money and in-the-money put
options (the reverse of call options as to the relation of exercise price
to market price) may be utilized in the same market environments that such
call options are used in equivalent transactions.
So long as the Fund's obligation as the writer of an option continues,
the Fund may be assigned an exercise notice by the broker-dealer through
which the option was sold, requiring the Fund to deliver, in the case of a
call, or take delivery of, in the case of a put, the underlying security
against payment of the exercise price. This obligation terminates when the
option expires or the Fund effects a closing purchase transaction. The
Fund can no longer effect a closing purchase transaction with respect to an
option once it has been assigned an exercise notice.
An option position may be closed out only if a secondary market for an
option of the same series exists on a recognized national securities
exchange or in the over-the-counter market. Because of this fact and
current trading conditions, the Fund expects to purchase only call or put
options issued by the Options Clearing Corporation. The Fund expects to
write options on national securities exchanges and in the over-the-counter
market.
While it may choose to do otherwise, the Fund generally will purchase
or write only those options for which the Manager believes there is an
active secondary market so as to facilitate closing transactions. There is
no assurance that sufficient trading interest to create a liquid secondary
market on a securities exchange will exist for any particular option or at
any particular time, and for some options no such secondary market may
exist. A liquid secondary market in an option may cease to exist for a
variety of reasons. In the past, for example, higher than anticipated
trading activity or order flow, or other unforeseen events, at times have
rendered certain clearing facilities inadequate and resulted in the
institution of special procedures, such as trading rotations, restrictions
on certain types of orders or trading halts or suspensions in one or more
options. There can be no assurance that similar events, or events that may
otherwise interfere with the timely execution of customers' orders, will
not recur. In such event, it might not be possible to effect closing
transactions in particular options. If as a covered call option writer the
Fund is unable to effect a closing purchase transaction in a secondary
market, it will not be able to sell the underlying security until the
option expires or it delivers the underlying security upon exercise or it
otherwise covers its position.
Stock Index Options The Fund may purchase and write put and call
options on stock indexes listed on national securities exchanges or traded
in the over-the-counter market as an investment vehicle for the purpose of
realizing its investment objective of capital appreciation or for the
purpose of hedging its portfolio. A stock index fluctuates with changes in
the market values of the stocks included in the index.
Options on stock indexes are similar to options on stock except that
(a) the expiration cycles of stock index options are monthly, while those
of stock options are currently quarterly, and (b) the delivery requirements
are different. Instead of giving the right to take or make delivery of a
stock at a specified price, an option on a stock index gives the holder the
right to receive a cash "exercise settlement amount" equal to (i) the
amount, if any, by which the fixed exercise price of the option exceeds (in
the case of a put) or is less than (in the case of a call) the closing
value of the underlying index on the date of exercise, multiplied by (ii) a
fixed "index multiplier." Receipt of this cash amount will depend upon the
closing level of the stock index upon which the option is based being
greater than, in the case of a call, or less than, in the case of a put,
the exercise price of the option. The amount of cash received will be
equal to such difference between the closing price of the index and the
exercise price of the option expressed in dollars times a specified
multiple. The writer of the option is obligated, in return for the premium
received, to make delivery of this amount. The writer may offset its
position in stock index options prior to expiration by entering into a
closing transaction on an exchange or it may let the option expire
unexercised.
Futures Contracts and Options on Futures Contracts. Upon exercise of
an option, the writer of the option delivers to the holder of the option
the futures position and the accumulated balance in the writer's futures
margin account, which represents the amount by which the market price of
the futures contract exceeds, in the case of a call, or is less than, in
the case of a put, the exercise price of the option on the futures
contract. The potential loss related to the purchase of options on futures
contracts is limited to the premium paid for the option (plus transaction
costs). Because the value of the option is fixed at the time of sale,
there are no daily cash payments to reflect changes in the value of the
underlying contract; however, the value of the option does change daily and
that change would be reflected in the net asset value of the Fund.
Interest Rate Futures Contracts and Options on Interest Rate Futures
Contracts. Upon exercise of an option, the delivery of the futures
position by the writer of the option to the holder of the option will be
accompanied by delivery of the accumulated balance in the writer's futures
margin account, which represents the amount by which the market price of
the futures contract exceeds, in the case of a call, or is less than, in
the case of a put, the exercise price of the option on the futures
contract. The potential loss related to the purchase of an option on
interest rate futures contracts is limited to the premium paid for the
option (plus transaction costs). Because the value of the option is fixed
at the point of sale, there are no daily cash payments to reflect changes
in the value of the underlying contract; however, the value of the option
does change daily and that change would be reflected in the net asset value
of the Fund.
Foreign Currency Transactions. The Fund may not hedge with respect to
a particular currency to an extent greater than the aggregate market value
(at the time of making such sale) of the securities held in its portfolio
denominated or quoted in or currently convertible into that particular
currency. If the Fund enters into a hedging transaction, the Fund will
deposit with its custodian cash or readily marketable securities in a
segregated account of the Fund in an amount at least equal to the value of
the Fund's total assets committed to the consummation of the forward
contract. If the value of the securities placed in the segregated account
declines, additional cash or securities will be placed in the account so
that the value of the account will equal the amount of the Fund's
commitment with respect to the contract. Hedging transactions may be made
from any foreign currency into U.S. dollars or into other appropriate
currencies.
At or before the maturity of a forward contract, the Fund either may
sell a portfolio security and make delivery of the currency, or retain the
security and offset its contractual obligation to deliver the currency by
purchasing a second contract pursuant to which the Fund will obtain, on the
same maturity date, the same amount of the currency which it is obligated
to deliver. If the Fund retains the portfolio security and engages in an
offsetting transaction, the Fund, at the time of execution of the
offsetting transaction, will incur a gain or a loss to the extent that
movement has occurred in forward contract prices. Should forward prices
decline during the period between the Fund's entering into a forward
contract for the sale of a currency and the date it enters into an
offsetting contract for the purchase of the currency, the Fund will realize
a gain to the extent the price of the currency it has agreed to sell
exceeds the price of the currency it has agreed to purchase. Should
forward prices increase, the Fund will suffer a loss to the extent the
price of the currency it has agreed to purchase exceeds the price of the
currency it has agreed to sell.
The cost to the Fund of engaging in currency transactions varies with
factors such as the currency involved, the length of the contract period
and the market conditions then prevailing. Because transactions in
currency exchange usually are conducted on a principal basis, no fees or
commissions are involved. The use of forward currency exchange contracts
does not eliminate fluctuations in the underlying prices of the securities,
but it does establish a rate of exchange that can be achieved in the
future. If a devaluation generally is anticipated, the Fund may not be
able to contract to sell the currency at a price above the devaluation
level it anticipates. The requirements for qualification as a regulated
investment company under the Internal Revenue Code of 1986, as amended (the
"Code"), may cause the Fund to restrict the degree to which it engages in
currency transactions. See "Dividends, Distributions and Taxes."
Lending Portfolio Securities. To a limited extent, the Fund may lend
its portfolio securities to brokers, dealers and other financial
institutions, provided it receives cash collateral which at all times is
maintained in an amount equal to at least 100% of the current market value
of the securities loaned. By lending its portfolio securities, the Fund
can increase its income through the investment of the cash collateral. For
purposes of this policy, the Fund considers collateral consisting of U.S.
Government securities or irrevocable letters of credit issued by banks
whose securities meet the standards for investment by the Fund to be the
equivalent of cash. From time to time, the Fund may return to the borrower
or a third party which is unaffiliated with the Fund, and which is acting
as a "placing broker," a part of the interest earned from the investment of
collateral received for securities loaned. Such loans may not exceed
33 1/3% of the value of the Fund's total assets.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value of
the securities rises above the level of such collateral; (3) the Fund must
be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any dividends, interest or
other distributions payable on the loaned securities, and any increase in
market value; (5) the Fund may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned
securities may pass to the borrower, the Fund's Board of Trustees must
terminate the loan and regain the right to vote the securities if a
material event adversely affecting the investment occurs. These conditions
may be subject to future modification.
Portfolio Securities. The Fund invests principally in common stocks
of domestic issuers, as well as securities of foreign companies and foreign
governments. Investments also may be made in convertible securities,
preferred stocks and debt securities without limitation when management
believes that such securities offer opportunities for capital growth.
Investment considerations with respect to lower rated debt securities are
set forth below.
Risk Factors
Lower Rated Securities. The Fund is permitted to invest in securities
rated below Baa by Moody's Investors Service, Inc. ("Moody's") and below
BBB by Standard & Poor's Corporation ("S&P") and as low as Caa by Moody's
or CCC by S&P. See "Description of the Fund--Risk Factors--Lower Rated
Securities" in the Prospectus for a discussion of certain risks and
"Appendix" for a general description of Moody's and S&P ratings. Although
ratings may be useful in evaluating the safety of interest and principal
payments, they do not evaluate the market value risk of these securities.
The Fund will rely on the Manager's judgment, analysis and experience in
evaluating the creditworthiness of an issuer. In this evaluation, the
Manager will take into consideration, among other things, the issuer's
financial resources, its sensitivity to economic conditions and trends, its
operating history, the quality of the issuer's management and regulatory
matters. It also is possible that a rating agency might not timely change
the rating on a particular issue to reflect subsequent events. Once the
rating of a security in the Fund's portfolio has been changed, the Manager
will consider all circumstances deemed relevant in determining whether the
Fund should continue to hold the security.
Investors should be aware that the market values of many of these
securities tend to be more sensitive to economic conditions than are higher
rated securities and will fluctuate over time. These securities are
considered by S&P and Moody's, on balance, as predominantly speculative
with respect to capacity to pay interest and repay principal in accordance
with the terms of the obligation and generally will involve more credit
risk than securities in the higher rating categories.
Companies that issue certain of these securities often are highly
leveraged and may not have available to them more traditional methods of
financing. Therefore, the risk associated with acquiring the securities of
such issuers generally is greater than is the case with the higher rated
securities. For example, during an economic downturn or a sustained period
of rising interest rates, highly leveraged issuers of these securities may
experience financial stress and may not have sufficient revenues to meet
their interest payment obligations. The issuer's ability to service its
debt obligations also may be affected adversely by specific corporate
developments or the issuer's inability to meet specific projected business
forecasts, or the unavailability of additional financing. The risk of loss
because of default by the issuer is significantly greater for the holders
of these securities because such securities generally are unsecured and
often are subordinated to other creditors of the issuer.
Because there is no established retail secondary market for many of
these securities, the Manager anticipates that such securities could be
sold only to a limited number of dealers or institutional investors. To
the extent a secondary trading market for these bonds does exist, it
generally is not as liquid as the secondary market for higher rated
securities. The lack of a liquid secondary market may have an adverse
impact on market price and yield and the Fund's ability to dispose of
particular issues when necessary to meet the Fund's liquidity needs or in
response to a specific economic event such as a deterioration in the
creditworthiness of the issuer. The lack of a liquid secondary market for
certain securities also may make it more difficult for the Fund to obtain
accurate market quotations for purposes of valuing the Fund's portfolio and
calculating its net asset value. Adverse publicity and investor
perceptions, whether or not based on fundamental analysis, may decrease the
values and liquidity of these securities. In such cases, judgment may play
a greater role in valuation because less reliable, objective data may be
available.
The Fund may acquire these securities during an initial offering.
Such securities may involve special risks because they are new issues. The
Fund has no arrangement with the Distributor or any other persons
concerning the acquisition of such securities, and the Manager will review
carefully the credit and other characteristics pertinent to such new
issues.
Zero Coupon Securities. Lower rated zero coupon securities and
pay-in-kind bonds in which the Fund may invest up to 5% of its net assets,
involve special considerations. Zero coupon securities are debt
obligations which do not entitle the holder to any periodic payments of
interest prior to maturity or a specified cash payment date when the
securities begin paying current interest (the "cash payment date") and
therefore are issued and traded at a discount from their face amount or par
value. The discount varies depending on the time remaining until maturity
or cash payment date, prevailing interest rates, liquidity of the security
and perceived credit quality of the issuer. The discount, in the absence
of financial difficulties of the issuer, decreases as the final maturity or
cash payment date of the security approaches.
The market prices of zero coupon securities generally are more
volatile than the market prices of securities that pay interest
periodically and are likely to respond to changes in interest rates to a
greater degree than do non-zero coupon securities having similar maturities
and credit quality. The credit risk factors pertaining to lower rated
securities also apply to lower rated zero coupon securities and pay-in-kind
bonds. Such zero coupon securities, pay-in-kind or delayed interest bonds
carry an additional risk in that, unlike bonds which pay interest
throughout the period to maturity, the Fund will realize no cash until the
cash payment date unless a portion of such securities are sold and, if the
issuer defaults, the Fund may obtain no return at all on its investment.
See "Dividends, Distributions and Taxes."
Investment Restrictions
The Fund has adopted investment restrictions numbered 1 through 13 as
fundamental policies. These restrictions cannot be changed without
approval by the holders of a majority (as defined in the Investment Company
Act of 1940 (the "Act")) of the Fund's outstanding voting shares.
Investment restriction number 14 is not a fundamental policy and may be
changed by a vote of a majority of the Trustees at any time. The Fund may
not:
1. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessors) if such
purchase would cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.
2. Purchase securities of closed-end investment companies except (a)
in the open market where no commission except the ordinary broker's
commission is paid, which purchases are limited to a maximum of (i) 3% of
the total voting stock of any one closed-end investment company, (ii) 5% of
its net assets with respect to any one closed-end investment company and
(iii) 10% of its net assets in the aggregate, or (b) those received as part
of a merger or consolidation. The Fund may not purchase the securities of
open-end investment companies other than itself.
3. Purchase or retain the securities of any issuer if the officers,
Trustees or Directors of the Fund or the Manager individually own
beneficially more than 1/2 of 1% of the securities of such issuer or
together own beneficially more than 5% of the securities of such issuer.
4. Invest in commodities, except that the Fund may purchase and sell
futures contracts, including those relating to indexes, and options on
futures contracts or indexes.
5. Purchase, hold or deal in real estate, or oil and gas interests,
but the Fund may purchase and sell securities that are secured by real
estate and may purchase and sell securities issued by companies that invest
or deal in real estate.
6. Borrow money, except (i) from banks for temporary or emergency
(not leveraging) purposes in an amount up to 15% of the value of the Fund's
total assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time
the borrowing is made and (ii) as described in the Fund's Prospectus and
this Statement of Additional Information. When borrowings under (i) exceed
5% of the value of the Fund's total assets, the Fund will not make any
additional investments. For purposes of this investment restriction, the
entry into options, futures contracts, including those relating to indexes,
and options on futures contracts or indexes shall not constitute borrowing.
7. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings and to the extent related to the
deposit of assets in escrow in connection with writing covered put and call
options and the purchase of securities on a when-issued or delayed-delivery
basis and collateral and initial or variation margin arrangements with
respect to options, futures contracts, including those relating to indexes,
and options on futures contracts or indexes.
8. Make loans to others, except through the purchase of debt
obligations. However, the Fund may lend its portfolio securities in an
amount not to exceed 33 1/3% of the value of its total assets. Any loans of
portfolio securities will be made according to guidelines established by
the Securities and Exchange Commission and the Fund's Trustees.
9. Act as an underwriter of securities of other issuers, except to
the extent the Fund may be deemed an underwriter under the Securities Act
of 1933, as amended, by virtue of disposing of portfolio securities.
10. Invest in the securities of a company for the purpose of
exercising management or control, but the Fund will vote the securities it
owns in its portfolio as a shareholder in accordance with its views.
11. Purchase, sell or write puts, calls or combinations thereof,
except as described in the Fund's Prospectus and Statement of Additional
Information.
12. Invest more than 25% of its assets in investments in any
particular industry or industries (including banking), provided that, when
the Fund has adopted a temporary defensive posture, there shall be no
limitation on the purchase of obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
13. Purchase warrants in excess of 2% of net assets. For purposes of
this restriction, such warrants shall be valued at the lower of cost or
market, except that warrants acquired by the Fund in units or attached to
securities shall not be included within this 2% restriction.
14. Enter into repurchase agreements providing for settlement in more
than seven days after notice or purchase securities which are illiquid, if,
in the aggregate, more than 15% of the value of the Fund's net assets would
be so invested.
If a percentage restriction is adhered to at the time an investment is
made, a later increase in percentage resulting from a change in values or
assets will not constitute a violation of such restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interests of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Trustees and officers of the Fund, together with information as to
their principal business occupations during at least the last five years,
are shown below. Each Trustee who is deemed to be an "interested person"
of the Fund, as defined in the Act, is indicated by an asterisk.
Trustees of the Fund
DIANE DUNST, Trustee. Since January 1992, President of Diane Dunst
Promotion, Inc., a full service promotion agency. From January 1989
to January 1992, Director of Promotion Services, Lear's Magazine.
From 1985 to January 1989, she was Sales Promotion Manager of ELLE
Magazine. Her address is 1070 Park Avenue, New York, New York 10021.
*DAVID P. FELDMAN, Trustee. Chairman and Chief Executive Officer at AT&T
Investment Management Corporation. He is also a trustee of Corporate
Property Investors, a real estate investment company. His address is
One Oak Way, Berkeley Heights, New Jersey 07922.
JAY I. MELTZER, Trustee. Physician engaged in private practice
specializing in internal medicine. He is also a member of the
Advisory Board of the Section of Society and Medicine, College of
Physicians and Surgeons, Columbia University and Clinical Professor of
Medicine, Department of Medicine, Columbia University College of
Physicians and Surgeons. His address is 903 Park Avenue, New York,
New York 10021.
DANIEL ROSE, Trustee. President and Chief Executive Officer of Rose
Associates, Inc., a New York based real estate development and
management firm. He is also Chairman of the Housing Committee of The
Real Estate Board of New York, Inc., and a Trustee of Corporate
Property Investors, a real estate investment company. His address is
c/o Rose Associates, Inc., 380 Madison Avenue, New York, New York
10017.
WARREN S. RUDMAN, Trustee. Since January 1993, Partner in the law firm
Paul, Weiss, Rifkind, Wharton & Garrison. From January 1981 to
January 1993, Mr. Rudman served as a United States Senator from the
state of New Hampshire. Also, since January 1993, Mr. Rudman has
served as Vice Chairman of the Federal Reserve Bank of Boston and as a
director of Chubb Corporation. Since 1988, Mr. Rudman has served as a
trustee of Boston College and since 1986 as a member of the Senior
Advisory Board of the Institute of Politics of the Kennedy School of
Government at Harvard University. His address is c/o Paul, Weiss,
Rifkind, Wharton & Garrison, 1615 L. Street, N.W., Washington, D.C.
20036.
*HOWARD STEIN, Trustee and Investment Officer. Chairman of the Board and
Chief Executive Officer of the Manager, Chairman of the Board of the
Distributor and an officer, director, or trustee or general partner of
other investment companies advised and administered by the Manager.
His address is 200 Park Avenue, New York, New York 10166.
SANDER VANOCUR, Trustee. Since January 1992, President of Old Owl
Communications, a full-service communications firm. Since November
1989, Mr. Vanocur has served as a Director of the Damon Runyon-Walter
Winchell Cancer Research Fund. From June 1986 to December 1991, he
was a Senior Correspondent of ABC News and, from October 1986 to
December 31, 1991, he was Anchor of the ABC News program "Business
World," a weekly business program on the ABC television network. His
address is 2928 P Street, N.W., Washington, D.C. 20007.
The "non-interested" Trustees and Mr. Feldman are also trustees of
Dreyfus BASIC U.S. Government Money Market Fund, Dreyfus California
Intermediate Municipal Bond Fund, Dreyfus Connecticut Intermediate
Municipal Bond Fund, Dreyfus Massachusetts Intermediate Municipal Bond Fund
and Dreyfus Strategic Income, and directors of Dreyfus BASIC Money Market
Fund, Inc., Dreyfus Strategic Governments Income, Inc. and FN Network Tax
Free Money Market Fund, Inc. Messrs. Feldman, Rose and Vanocur are also
directors of Dreyfus New Jersey Municipal Bond Fund, Inc., managing general
partners of Dreyfus Strategic Growth, L.P. and Dreyfus Strategic World
Investing, L.P., and trustees of Dreyfus Florida Intermediate Municipal
Bond Fund, Dreyfus Index Fund, Dreyfus New York Insured Tax Exempt Bond
Fund and Dreyfus Investors GNMA Fund, Dreyfus 100% U.S. Treasury
Intermediate Term Fund, Dreyfus 100% U.S. Treasury Long Term Fund, Dreyfus
100% U.S. Treasury Money Market Fund, Dreyfus 100% U.S. Treasury Short Term
Fund. Mr. Feldman is also a trustee of Dreyfus Index Fund and a director
of Dreyfus Edison Electric Index Fund, Inc., Dreyfus Life and Annuity Index
Fund, Inc., Peoples Index Fund, Inc. and Peoples S&P MidCap Index Fund, Inc
and Premier Global Investing. Mr. Rudman is also a trustee of Dreyfus Cash
Management, Dreyfus Government Cash Management, Dreyfus Municipal Cash
Management, Dreyfus New York Municipal Cash Management, Dreyfus Tax Exempt
Cash Management, Dreyfus Treasury Cash Management and Dreyfus Treasury
Prime Cash Management, and a director or Dreyfus Cash Management Plus, Inc.
There ordinarily will be no meetings of shareholders for the purpose
of electing Trustees unless and until such time as less than a majority of
the Trustees holding office have been elected by shareholders, at which
time the Trustees then in office will call a shareholders' meeting for the
election of Trustees. Under the Act, shareholders of record of not less
than two-thirds of the outstanding shares of the Fund may remove a Trustee
through a declaration in writing or by vote cast in person or by proxy at a
meeting called for that purpose. Under the Fund's Agreement and
Declaration of Trust, the Trustees are required to call a meeting of
shareholders for the purpose of voting upon the question of removal of any
such Trustee when requested in writing to do so by the shareholders of
record of not less than 10% of the Fund's outstanding shares.
For so long as the Fund's plans described in the section captioned
"Distribution Plan and Shareholder Service Plan" remain in effect, the
Trustees of the Fund who are not "interested persons" of the Fund, as
defined in the Act, will be selected and nominated by the Trustees who are
not "interested persons" of the Fund.
The Fund does not pay any remuneration to its officers and Trustees
other than fees and expenses to Trustees who are not officers, directors,
or employees or holders of 5% or more of the outstanding voting securities
of the Manager, which totalled $18,436 for the fiscal year ended October
31, 1993 for such Trustees as a group.
Officers of the Fund Not Listed Above
RICHARD C. SHIELDS, President and Investment Officer. An employee of the
Manager and an officer of other investment companies advised or
administered by the Manager.
MARK N. JACOBS, Vice President. Secretary and Deputy General Counsel of
the Manager and an officer of other investment companies advised or
administered by the Manager.
JEFFREY N. NACHMAN, Vice President-Financial. Vice President -- Mutual
Fund Accounting of the Manager and an officer of other investment
companies advised or administered by the Manager.
JOHN J. PYBURN, Treasurer. Assistant Vice President of the Manager and an
officer of other investment companies advised or administered by the
Manager.
DANIEL C. MACLEAN, Secretary. Vice President and General Counsel of the
Manager, Secretary of the Distributor and an officer of other
investment companies advised or administered by the Manager.
A. THOMAS SMITH III, Assistant Secretary. Since August 1991, Assistant
General Counsel of the Manager. From January 1989 to August 1991,
Senior Associate with Willkie Farr & Gallagher, and from January 1986
to December 1988, Staff Attorney in the Chief Counsel's Office of the
U.S. Securities and Exchange Commission, Division of Investment
Management.
CHRISTINE PAVALOS, Assistant Secretary. Assistant Secretary of the
Manager, the Distributor and other investment companies advised or
administered by the Manager.
PAUL R. CASTI, Jr.; Controller. Senior Accounting Manager in the Fund
Accounting Department of the Manager and an officer of other
investment companies advised or administered by the Manager.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Trustees and officers of the Fund, as a group, owned less than 1% of
the Fund's shares of beneficial interest outstanding on December 22, 1993.
The following persons are also officers and/or Directors of the
Manager: Julian M. Smerling, Vice Chairman of the Board of Directors;
Joseph S. DiMartino, President, Chief Operating Officer and a Director;
Alan M. Eisner, Vice President and Chief Financial Officer; David W. Burke,
Vice President and Chief Administrative Officer; Robert F. Dubuss, Vice
President; Elie M. Genadry, Vice President-Institutional Sales; Peter A.
Santoriello, Vice President; Robert H. Schmidt, Vice President; Kirk V.
Stumpp, Vice President--New Product Development; Philip L. Toia, Vice
President; Maurice Bendrihem, Controller; Katherine C. Wickham, Assistant
Vice President--Human Resources; and Mandell L. Berman, Alvin E. Friedman,
Lawrence M. Greene, Abigail Q. McCarthy and David B. Truman, Directors.
MANAGEMENT AGREEMENT
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") dated September 11, 1986, as amended, with the
Fund which is subject to annual approval by (i) the Fund's Board of
Trustees or (ii) vote of a majority (as defined in the Act) of the
outstanding voting securities of the Fund, provided that in either event
the continuance also is approved by a majority of the Trustees who are not
"interested persons" (as defined in the Act) of the Fund or the Manager, by
vote cast in person at a meeting called for the purpose of voting such
approval. The Agreement was approved by shareholders at a meeting held on
June 25, 1992, and was last approved by the Board of Trustees, including a
majority of the Trustees who are not "interested persons" of any party to
the Agreement, at a meeting held on August 11, 1993. The Agreement is
terminable without penalty, on 60 days' notice, by the Fund's Board of
Trustees or by vote of the holders of a majority of the Fund's shares or,
upon not less than 90 days' notice, by the Manager. The Agreement will
terminate automatically in the event of its assignment (as defined in the
Act).
The Manager manages the Fund's portfolio of investments in accordance
with the stated policies of the Fund, subject to the approval of the Fund's
Board of Trustees. The Manager is responsible for investment decisions,
and provides the Fund with Investment Officers who are authorized by the
Board of Trustees to execute purchases and sales of securities. The Fund's
Investment Officers are Barbara L. Kenworthy, Richard C. Shields, Howard
Stein and Wolodymyr Wronskyj. The Manager also maintains a research
department with a professional staff of portfolio managers and securities
analysts who provide research services for the Fund as well as for other
funds advised by the Manager. All purchases and sales are reported for the
Trustees' review at the meeting subsequent to such transactions.
All expenses incurred in the operation of the Fund are borne by the
Fund, except to the extent specifically assumed by the Manager. The
expenses borne by the Fund include: taxes, interest, loan commitment fees,
dividends and interest paid on securities sold short, brokerage fees and
commissions, if any, fees of Trustees who are not officers, directors,
employees or holders of 5% or more of the outstanding voting securities of
the Manager, Securities and Exchange Commission fees, state Blue Sky
qualification fees, advisory fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of maintaining
the Fund's existence, costs of independent pricing services, costs
attributable to investor services (including, without limitation, telephone
and personnel expenses), costs of shareholders' reports and meetings and
any extraordinary expenses. Class A and Class B shares are subject to an
annual service fee for ongoing personal services relating to shareholder
accounts and services related to the maintenance of shareholder accounts.
In addition, Class B shares are subject to an annual distribution fee for
advertising, marketing and distributing Class B shares pursuant to
distribution plan adopted in accordance with Rule 12b-1 under the Act. See
"Distribution Plan and Shareholder Service Plan."
As compensation for its services, the Fund has agreed to pay the
Manager a monthly management fee at the annual rate of .75 of 1% of the
value of the Fund's average daily net assets. The management fees for the
fiscal years ended October 31, 1991, 1992 and 1993 amounted to $905,069,
$1,547,781 and $2,022,123, respectively.
The Manager pays the salaries of all officers and employees employed
by both it and the Fund, maintains office facilities, and furnishes
statistical and research data, clerical help, accounting, data processing,
bookkeeping and internal auditing and certain other required services. The
Manager also may make such advertising and promotional expenditures, using
its own resources, as it from time to time deems appropriate.
The Manager has agreed that if, in any fiscal year, the aggregate
expenses of the Fund, exclusive of taxes, brokerage, interest on borrowings
and (with the prior written consent of the necessary state securities
commissions) extraordinary expenses, but including the management fee,
exceed the expense limitation of any state having jurisdiction over the
Fund, the Fund may deduct from the payment to be made to the Manager under
the Agreement, or the Manager will bear, such excess expense to the extent
required by state law. Such deduction or payment, if any, will be
estimated daily, and reconciled and effected or paid, as the case may be,
on a monthly basis.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of the Fund's net assets increases.
PURCHASE OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
The Distributor. The Distributor serves as the Fund's distributor
pursuant to an agreement which is renewable annually. The Distributor also
acts as distributor for the other funds in the Dreyfus Family of Funds and
for certain other investment companies.
Dreyfus TeleTransfer Privilege. Dreyfus TeleTransfer purchase orders
may be made between the hours of 8:00 A.M. and 4:00 P.M., New York time, on
any business day that The Shareholder Services Group, Inc., the Fund's
transfer and dividend disbursing agent (the "Transfer Agent"), and the New
York Stock Exchange are open. Such purchases will be credited to the
investor's Fund account on the next bank business day. To qualify to use
Dreyfus TeleTransfer, payments for purchase of Fund shares must be drawn
on, and redemption proceeds paid to, the same bank and account as is
designated on the Account Application or Optional Services Form on file.
If the proceeds of a particular redemption are to be wired to an account at
any other bank, the request must be in writing and signature-guaranteed.
See also "Redemption of Fund Shares--Dreyfus TeleTransfer Privilege."
Sales Loads -- Class A. The scale of sales loads applies to purchases
of Class A shares made by any "purchaser," which term includes an
individual and/or spouse purchasing securities for his, her or their own
account or for the account of any minor children, or a trustee or other
fiduciary purchasing securities for a single trust estate or a single
fiduciary account trust estate or a single fiduciary account (including a
pension, profit-sharing or other employee benefit trust created pursuant to
a plan qualified under Section 401 of the Code) although more than one
beneficiary is involved; or a group of accounts established by or on behalf
of the employees of an employer or affiliated employers pursuant to an
employee benefit plan or other program (including accounts established
pursuant to Sections 403(b), 408(k), and 457 of the Code); or an organized
group which has been in existence for more than six months, provided that
it is not organized for the purpose of buying redeemable securities of a
registered investment company and provided that the purchases are made
through a central administration or a single dealer, or by other means
which result in economy of sales effort or expense.
Offering Prices
Based upon the Fund's net asset value at the close of business on October
31, 1993 the maximum offering price of the Fund's shares would have been as
follows:
Class A shares:
NET ASSET VALUE per share. . . . . . . . . . . . . . . . . .$23.77
Sales load for individual sales of shares aggregating less
than $50,000 - 4.5 percent of offering price
(approximately 4.7 percent of net asset value per share) . 1.12
Offering price to public . . . . . . . . . . . . . . . . . .$24.89
Class B shares:
NET ASSET VALUE, redemption price and offering
price to public* . . . . . . . . . . . . . . . . . . . . .$23.62
___________________
* Class B shares are subject to a contingent deferred sales charge on
certain redemptions. She "How to Redeem Fund Shares" in the Fund's
Prospectus.
DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Distribution Plan and Shareholder Services Plan."
The Class A and Class B shares are subject to a Shareholder Services
Plan and the Class B shares only are subject to a Distribution Plan.
Distribution Plan. Rule 12b-1 (the "Rule") adopted by the
Securities and Exchange Commission under the Act, provides, among other
things, that an investment company may bear expenses of distributing its
shares only pursuant to a plan adopted in accordance with the Rule. The
Fund's Board of Trustees has adopted such a plan (the "Distribution Plan")
with respect to the Class B shares, pursuant to which the Fund pays the
Distributor for advertising, marketing and distributing Class B shares.
Under the Distribution Plan, the Distributor may make payments to certain
financial institutions, securities dealers, and other financial industry
professionals (collectively, "Service Agents") in respect of these
services. The Fund's Board of Trustees believes that there is a reasonable
likelihood that the Distribution Plan will benefit the Fund and holders of
its Class B shares. In some states, certain financial institutions
effecting transactions in Fund shares may be required to register as
dealers pursuant to state law.
A quarterly report of the amounts expended under the Distribution
Plan, and the purposes for which such expenditures were incurred, must be
made to the Trustees for their review. In addition, the Distribution Plan
provides that it may not be amended to increase materially the costs which
holders of Class B shares may bear for distribution pursuant to the
Distribution Plan without such shareholder approval and that other material
amendments of the Distribution Plan must be approved by the Board of
Trustees, and by the Trustees who are not "interested persons" (as defined
in the Act) of the Fund and have no direct or indirect financial interest
in the operation of the Distribution Plan or in any agreements entered into
in connection with the Distribution Plan, by vote cast in person at a
meeting called for the purpose of considering such amendments. The
Distribution Plan is subject to annual approval by such vote cast in person
at a meeting called for the purpose of voting on the Distribution Plan.
The Distribution Plan was last approved by the Board of Trustees at a
meeting held on August 11, 1993. The Distribution Plan may be terminated
at any time by vote of a majority of the Trustees who are not "interested
persons" and have no direct or indirect financial interest in the operation
of the Distribution Plan or in any related agreements entered into in
connection with the Distribution Plan or by vote of the holders of a
majority of the Class B shares.
For the period from January 15, 1993 (effective date of the
Distribution Plan) through October 31, 1993, $69,493 was charged to the
Fund, with respect to Class B shares, under the Distribution Plan.
Shareholder Services Plan. The Fund has adopted a Shareholder
Services Plan, pursuant to which the Fund pays the Distributor for the
provision of certain services to the holders of Class A and Class B shares.
A quarterly report of the amounts expended under the Shareholder
Services Plan, and the purposes for which such expenditures were incurred,
must be made to the Trustees for their review. In addition, the
Shareholder Services Plan provides that it may not be amended without
approval of the Board of Trustees, and by the Trustees who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in the operation of the Shareholder Services
Plan or in any agreements, entered into in connection with the Shareholder
Services Plan, by vote cast in person at a meeting called for the purpose
of considering such amendments. The Shareholder Services Plan is subject
to annual approval by such vote cast in person at a meeting called for the
purpose of voting on the Shareholder Services Plan. The Shareholder
Services Plan was so approved on August 11, 1993. The Shareholder Services
Plan is terminable at any time by vote of a majority of the Trustees who
are not "interested persons" and who have no direct or indirect financial
interest in the operation of the Shareholder Services Plan or in any
agreements entered into in connection with the Shareholder Services Plan.
For the period from January 15, 1993 (effective date of the Shareholder
Services Plan) through October 31, 1993, $650,877 was charged to the Fund,
with respect to Class A, and $23,164 was charged to the Fund, with respect
to Class B shares, under the Shareholder Services Plan.
Prior Rule 12b-1 Plan. As of January 15, 1993, the Fund terminated
its then existing Rule 12b-1 plan, which provided for payments to be made
to Service Agents for advertising, marketing and/or distributing Class A
shares and servicing holders of Class A shares. For the period November 1,
1992 through January 15, 1993, $128,633 was charged to the Fund with
respect to Class A shares under such Rule 12b-1 plan. All of which was
paid for advertising, marketing and servicing the Fund's Class A shares.
REDEMPTION OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Fund Shares."
Share Certificates; Signatures. Any certificates representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each owner of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York
Stock Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP"), and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the guarantor and
"Signature-Guaranteed" must appear with the signature. The Transfer Agent
may request additional documentation from corporations, executors,
administrators, trustees or guardians, and may accept other suitable
verification arrangements from foreign investors, such as consular
verification. For more information with respect to signature-guarantees,
please call one of the telephone numbers listed on the cover.
Dreyfus TeleTransfer Privilege. Investors should be aware that if
they have selected the Dreyfus TeleTransfer Privilege, any request for a
wire redemption will be effected as a Dreyfus TeleTransfer transaction
through the Automated Clearing House ("ACH") system. Redemption proceeds
will be on deposit in the investor's account at an ACH member bank
ordinarily two business days after receipt of the redemption request. See
"Purchase of Fund Shares--Dreyfus TeleTransfer Privilege."
Redemption Commitment. The Fund has committed itself to pay in cash
all redemption requests by any shareholder of record, limited in amount
during any 90-day period to the lesser of $250,000 or 1% of the value of
the Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, the Board of Trustees reserves the right to make payments in whole
or part in securities or other assets of the Fund in case of an emergency
or any time a cash distribution would impair the liquidity of the Fund to
the detriment of the existing shareholders. In such event, the securities
would be valued in the same manner as the Fund's portfolio is valued. If
the recipient sold such securities, brokerage charges would be incurred.
In connection with a redemption request where the Fund delivers in-kind
securities instead of cash on settlement date to an Texas investor, the in-
kind securities delivered will be readily marketable securities to the
extent available.
Suspension of Redemption. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than customary weekend and holiday
closings), (b) when trading in the markets the Fund ordinarily utilizes is
restricted, or when an emergency exists as determined by the Securities and
Exchange Commission so that disposal of the Fund's investments or
determination of its net asset value is not reasonably practicable, or (c)
for such other periods as the Securities and Exchange Commission by order
may permit to protect the Fund's shareholders.
SHAREHOLDER SERVICES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Shareholder
Services."
Exchange Privilege. Class A and Class B shares of the Fund may be
exchanged for shares of the respective Class of certain other funds advised
or administered by the Manager. Shares of the same Class of such other
funds purchased by exchange will be purchased on the basis of relative net
asset value per share as follows:
A. Class A shares of funds purchased without a sales load may be
exchanged for Class A shares of other funds sold with a sales
load, and the applicable sales load will be deducted.
B. Class A shares of funds purchased with or without a sales load
may be exchanged without a sales load for Class A shares of other
funds sold without a sales load.
C. Class A shares of funds purchased with a sales load, Class A
shares of funds acquired by a previous exchange from Class A
shares purchased with a sales load, and additional Class A shares
acquired through reinvestment of dividends or distributions of
any such funds (collectively referred to herein as "Purchased
Shares") may be exchanged for Class A shares of other funds sold
with a sales load (referred to herein as "Offered Shares"),
provided that, if the sales load applicable to the Offered Shares
exceeds the maximum sales load that could have been imposed in
connection with the Purchased Shares (at the time the Purchased
Shares were acquired), without giving effect to any reduced
loads, the difference will be deducted.
D. Class B shares of any fund may be exchanged for Class B shares of
other funds without a sales load. Class B shares of any fund
exchanged for Class shares of another fund will be subject to the
higher applicable contingent deferred sales charge ("CDSC") of
the two funds and, for purposes of calculating CDSC rates and
conversion periods, will be deemed to have been held since the
date the Class B shares being exchanged were initially purchased.
To accomplish an exchange under item C above, shareholders must
notify the Transfer Agent of their prior ownership of such Class A shares
and their account number.
To use this privilege, an investor or the investor's Service Agent
acting on his behalf must give exchange instructions to the Transfer Agent
in writing, by wire or by telephone. Telephone exchanges may be made only
if the appropriate "YES" box has been checked on the Account Application or
a separate signed Optional Services Form is on file with the Transfer
Agent. By using this Privilege, the investor authorizes the Transfer Agent
to act on telephonic, telegraphic or written exchange instructions from any
person representing himself or herself to be the investor or a
representative of the investor's Service Agent, and reasonably believed by
the Transfer Agent to be genuine. Telephone exchanges may be subject to
limitations as to the amount involved or the number of telephone exchanges
permitted. Shares issued in certificate form are not eligible for
telephone exchange.
To establish a Personal Retirement Plan by exchange, shares of the
fund being exchanged must have a value of at least the minimum initial
investment required for shares of the same class of the fund into which the
exchange is being made. For Dreyfus-sponsored Keogh Plans, IRAs and IRAs
set up under a Simplified Employee Pension Plan ("SEP-IRAs") with only one
participant, the minimum initial investment is $750. To exchange shares
held in Corporate Plans, 403(b)(7) Plans and SEP-IRAs with more than one
participant, the minimum initial investment is $100 if the plan has at
least $2,500 invested among shares of the same Class of the funds in the
Dreyfus Family of Funds. To exchange shares held in Personal Retirement
Plans, the shares exchanged must have a current value of at least $100.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for Class A or Class B shares
of the Fund, shares of the same Class of another fund in the Dreyfus Family
of Funds. This Privilege is available only for existing accounts. Shares
will be exchanged on the basis of relative net asset value as described
above under "Exchange Privilege." Enrollment in or modification or
cancellation of this Privilege is effective three business days following
such notification by the investor. An investor will be notified if his
account falls below the amount designated under this Privilege. In this
case, an investor's account will fall to zero unless additional investments
are made in excess of the designated amount prior to the next Auto-Exchange
transaction. Shares held under IRA and other retirement plans are eligible
for this Privilege. Exchanges of IRA shares may be made between IRA
accounts and from regular accounts to IRA accounts, but not from IRA
accounts to regular accounts. With respect to all other retirement
accounts, exchanges may be made among those accounts.
The Exchange Privilege and Dreyfus Auto-Exchange Privilege are
available to shareholders resident in any state in which shares of the fund
being acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
Optional Services Forms and prospectuses of the other funds may be
obtained from the Distributor, 144 Glenn Curtiss Boulevard, Uniondale, New
York 11556-0144. The Fund reserves the right to reject any exchange
request in whole or in part. The Exchange Privilege or Dreyfus Auto-
Exchange Privilege may be modified or terminated at any time upon notice to
shareholders.
Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an
investor with a $5,000 minimum account to request withdrawal of a specified
dollar amount (minimum of $50) on either a monthly or quarterly basis.
Withdrawal payments are the proceeds from sales of Fund shares, not the
yield on the shares. If withdrawal payments exceed reinvested dividends
and distributions, the investor's shares will be reduced and eventually may
be depleted. An Automatic Withdrawal Plan may be established by completing
the appropriate application available from the Distributor. There is a
service charge of $.50 for each withdrawal check. Automatic Withdrawal may
be terminated at any time by the investor, the Fund or the Transfer Agent.
Shares for which certificates have been issued may not be redeemed through
the Automatic Withdrawal Plan. Class B shares withdrawn pursuant to the
Automatic Withdrawal Plan will be subject to any applicable CDSC.
Dividend Sweep Privilege. Dreyfus Dividend Sweep Privilege allows
investors to invest on the payment date their dividends or dividends and
capital gain distributions, if any, from the Fund in shares of the same
Class of another fund in the Dreyfus Family of Funds of which the investor
is a shareholder. Shares of the same Class of other funds purchased
pursuant to this Privilege will be purchased on the basis of relative net
asset value per share as follows:
A. Dividends and distributions paid with respect to Class A shares
by a fund may be invested without imposition of a sales load in
Class A shares of other funds that are offered without a sales
load.
B. Dividends and distributions paid with respect to Class A shares
by a fund which does not charge a sales load may be invested in
Class A shares of other funds sold with a sales load, and the
applicable sales load will be deducted.
C. Dividends and distributions paid with respect to Class A shares
by a fund which charges a sales load may be invested in Class A
shares of other funds sold with a sales load (referred to herein
as "Offered Shares"), provided that, if the sales load applicable
to the Offered Shares exceeds the maximum sales load charged by
the fund from which dividends or distributions are being
swept, without giving effect to any reduced loads, the difference
will be deducted.
D. Dividends and distributions paid with respect to Class B shares
by a fund may be invested without imposition of a sales load in
Class B shares of other funds and the applicable CDSC, if any,
will be imposed upon redemption of such shares.
Corporate Pension/Profit-Sharing and Personal Retirement Plans. The
Fund makes available to corporations a variety of prototype pension and
profit-sharing plans, including a 401(k) Salary Reduction Plan. In
addition, the Fund makes available Keogh Plans, IRAs, including SEP-IRAs
and IRA "Rollover Accounts," and 403(b)(7) Plans. Plan support services
are also available. For details contact Dreyfus Group Retirement Plans, a
division of the Distributor, by calling toll free 1-800-358-5566.
Investors who wish to purchase Fund shares in conjunction with a
Keogh Plan, a 403(b)(7) Plan or an IRA, including a SEP-IRA, may request
from the Distributor forms for adoption of such plans.
The entity which acts as custodian may charge a fee for Keogh Plans,
403(b)(7) Plans or IRAs, payment of which could require the liquidation of
shares. All fees charged are described in the appropriate form.
Shares may be purchased in connection with these plans only by direct
remittance to the entity which acts as custodian. Purchases for these
plans may not be made in advance of receipt of funds.
The minimum initial investment for corporate plans, Salary Reduction
Plans, 403(b)(7) Plans, and SEP-IRAs, with more than one participant, is
$2,500, with no minimum on subsequent purchases. The minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs, and 403(b)(7)
Plans with only one participant is normally $750, with no minimum on
subsequent purchases. Individuals who open an IRA also may open a
non-working spousal IRA with a minimum investment of $250.
The investor should read the Prototype Retirement Plan and the
appropriate form of Custodial Agreement for further details as to
eligibility, service fees and tax implications, and should consult a tax
adviser.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
Valuation of Portfolio Securities. Portfolio securities, including
covered call options written by the Fund, are valued at the last sale price
on the securities exchange or national securities market on which such
securities primarily are traded. Securities not listed on an exchange or
national securities market, or securities in which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except in the case of open short positions where the asked price is
used for valuation purposes. Bid price is used when no asked price is
available. Market quotations for foreign securities in foreign currencies
are translated into U.S. dollars at the prevailing rates of exchange. Any
securities or other assets for which recent market quotations are not
readily available are valued at fair value as determined in good faith by
the Board of Trustees. Expenses and fees, including the management fee and
fees pursuant to the Shareholder Service Plan, with respect to the Class A
and Class B shares, and fees pursuant to the Distribution Plan, with
respect to the Class B shares only, are accrued daily and taken into
account for the purpose of determining the net asset value of the relevant
Class of shares. Because of the difference in operating expenses incurred
by each Class, the per share net asset value of each Class will differ.
New York Stock Exchange Closings. The holidays (as observed) on
which the New York Stock Exchange is closed currently are: Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving
and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
Management believes that the Fund qualified as a "regulated
investment company" under the Code for fiscal year ended October 31, 1993
and the Fund intends to continue to so qualify if such qualification is in
the best interests of its shareholders. As a regulated investment company,
the Fund will pay no Federal income tax on net investment income and net
realized capital gains to the extent that such income and gains are
distributed to shareholders in accordance with the applicable provisions of
the Code. To qualify as a regulated investment company, the Fund
distribute at least 90% of its net income (consisting of net investment
income and net short-term capital gain) to its shareholders, must derive
less than 30% of its annual gross income from gain on the sale of
securities held for less than three months, and must meet certain asset
diversification and other requirements. Accordingly, the Fund may be
restricted in the selling of securities held for less than three months,
and in the utilization of certain of the investment techniques described in
the Prospectus under "Description of the Fund -- Investment Techniques."
The Code, however, allows the Fund to net certain offsetting positions
making it easier for the Fund to satisfy the 30% test. The term "regulated
investment company" does not imply the supervision of management or
investment practices or policies by any government agency.
Any dividend or distribution paid shortly after an investor's
purchase may have the effect of reducing the aggregate net asset value of
his shares below the cost of his investment. Such a dividend would be a
return on investment in an economic sense, although taxable as stated
above. In addition, the Code provides that if a shareholder holds shares
of the Fund for six months or less and has received a capital gain
distribution with respect to such shares, any loss incurred on the sale of
such shares will be treated as long-term capital loss to the extent of the
capital gain distribution received.
Ordinarily, gains and losses realized from portfolio transactions
will be treated as capital gains or losses. However, a portion of the gain
or loss realized from the disposition of non-U.S. dollar denominated
securities (including debt instruments, certain financial forwards, futures
and options, and certain preferred stock) may be treated as ordinary income
or loss under Section 988 of the Code. In addition, all or a portion of
the gain realized from the disposition of certain market discount bonds
will be treated as ordinary income under section 1276. Finally, all or a
portion of the gain realized from engaging in "conversion transactions" may
be treated as ordinary income under Section 1258. "Conversion
transactions" are defined to include certain forward, futures, option and
straddle transactions, transactions marketed or sold to produce capital
gains, or transactions described in Treasury regulations to be issued in
the future.
Under Section 1256 of the Code, gain or loss realized by the Fund
from certain financial futures or forward contracts and certain options
transactions (other than those taxed under Section 988 of the Code) will be
treated as 60% long-term capital gain or loss and 40% short-term capital
gain or loss. Gain or loss will arise upon exercise or lapse of such
futures, forwards and options as well as from closing transactions. In
addition, any such futures, forwards or options remaining unexercised at
the end of the Fund's taxable year will be treated as sold for their then
fair market value, resulting in additional gain or loss to the Fund
characterized in the manner described above.
Offsetting positions held by the Fund involving certain financial
forwards or futures contracts or options transactions may be considered,
for tax purposes, to constitute "straddles." "Straddles" are defined to
include "offsetting positions" in actively traded personal property. The
tax treatment of "straddles" is governed by Sections 1092 and 1258 of the
Code, which, in certain circumstances, overrides or modifies the provisions
of Sections 988 and 1256. As such, all or a portion of any short-or long-
term capital gain from certain "straddle" transactions may be
recharacterized to ordinary income.
If the Fund were treated as entering into "straddles" by reason of
its engaging in financial forward or futures contracts or options
transactions, such "straddles" would be characterized as "mixed straddles"
if the futures, forwards or options comprising a part of such "straddles"
were governed by Section 1256 of the Code. The Fund may make one or more
elections with respect to "mixed straddles." If no election is made, to
the extent the straddle rules apply to positions established by the Fund,
losses realized by the Fund will be deferred to the extent of unrealized
gain in any offsetting positions. Moreover, as a result of the straddle
and conversion transaction rules, short-term capital loss on straddle
positions may be recharacterized as long-term capital loss, and long-term
capital gain may be recharacterized as short-term capital gain or ordinary
income.
Investment by the Fund in securities issued or acquired at a discount
or providing for deferred interest or for payment of interest in the form
of additional obligations could, under special tax rules, affect the
amount, timing and character of distributions to shareholders. For
example, the Fund could be required to take into account annually a portion
of the discount (or deemed discount) at which such securities were issued
and to distribute such portion in order to maintain its qualification as a
regulated investment company. In such case, the Fund may have to dispose
of securities which it might otherwise have continued to hold in order to
generate cash to satisfy these distribution requirements.
PORTFOLIO TRANSACTIONS
The Manager supervises the placement of orders on behalf of the Fund
for the purchase or sale of portfolio securities. Allocation of brokerage
transactions, including their frequency, is made in the best judgment of
the Manager and in a manner deemed fair and reasonable to shareholders.
The primary consideration is prompt execution of orders at the most
favorable net price. Subject to this consideration, the brokers selected
include those that supplement the Manager's research facilities with
statistical data, investment information, economic facts and opinions.
Information so received is in addition to and not in lieu of services
required to be performed by the Manager and the fee of the Manager is not
reduced as a consequence of the receipt of such supplemental information.
Such information may be useful to the Manager in serving both the Fund and
other funds which it manages and, conversely, supplemental information
obtained by the placement of business of other clients may be useful to the
Manager in carrying out its obligation to the Fund. Brokers also are
selected because of their ability to handle special executions such as are
involved in large block trades or broad distributions, provided the primary
consideration is met. Large block trades may, in certain cases, result
from two or more funds managed by the Manager being engaged simultaneously
in the purchase or sale of the same security. Certain of the Fund's
transactions in securities of foreign issuers may not benefit from the
negotiated commission rates available to the Fund for transactions in
securities of domestic issuers. Portfolio turnover may vary from year to
year, as well as within a year. High turnover rates are likely to result
in comparatively greater brokerage expenses. The overall reasonableness of
brokerage commissions paid is evaluated by the Manager based upon its
knowledge of available information as to the general level of commissions
paid by other institutional investors for comparable services.
For the fiscal years ended October 31, 1991, 1992 and 1993 the Fund
paid total brokerage commissions of $685,757, $1,544,568 and $2,720,136,
respectively, none of which was paid to the Distributor. The above figures
for brokerage commissions paid do not include gross spreads and concessions
on principal transactions which, where determinable, amounted to
$1,712,882, $1,293,013 and $1,603,133 in fiscal 1991, 1992 and 1993,
respectively, none of which was paid to the Distributor.
PERFORMANCE INFORMATION
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Performance
Information."
The offering of Class B shares commenced on January 15, 1993 and,
accordingly, only limited performance data are available for Class B at this
time.
The average annual total return for Class A for the 1, 5 and 7.044
year periods ended October 31, 1993 was-14.31%, 14.40% and 14.23%,
respectively. The average annual total return for the period from January
15, 1993 (commencement of initial offering of Class B shares) through
October 31, 1993 for Class B was 8.22%. Average annual total return is
calculated by determining the ending redeemable value of an investment
purchased with a hypothetical $1,000 payment made at the beginning of the
period (assuming the reinvestment of dividends and distributions), dividing
by the amount of the initial investment, taking the "n"th root of the
quotient (where "n" is the number of years in the period) and subtracting
one from the result. A Class's average annual total return figures
calculated in accordance with such formula assume that in the case of Class
A the maximum sales load has been deducted from the hypothetical initial
investment at the time of purchase or in the case of Class B the maximum
applicable CDSC has been paid upon redemption at the end of the period.
Total return is calculated by subtracting the amount of the maximum
offering price per share at the beginning of a stated period from the net
asset value per share at the end of the period (after giving effect to the
reinvestment of dividends and distributions during the period), and
dividing the result by the maximum offering price per share at the
beginning of the period. Total return also may be calculated based on the
net asset value per share at the beginning of the period for Class A shares
or without giving effect to any applicable CDSC at the end of the period
for Class B shares. In such cases, the calculation would not reflect the
deduction of the sales load with respect to Class A shares or any
applicable CDSC with respect to Class B shares, which, if reflected, would
reduce the performance quoted. The total return for Class A for the period
October 16, 1986 to October 31, 1993, based on the maximum offering price
per share, was 155.27%. Based on net asset value per share, the total
return for Class A was 167.28% for this period. The total return for the
period January 15, 1993 through October 31, 1993 for Class B, after giving
effect to the maximum applicable CDSC, was 6.48%. Without giving effect to
the maximum applicable CDSC, the total return for Class B was 10.48% for
this period.
Comparative performance may be used from time to time in advertising
the Fund's shares, including data from Lipper Analytical Services, Inc.,
Standard & Poor's 500 Composite Stock Price Index, the Dow Jones Industrial
Average, Money Magazine, Morningstar, Inc. and other industry publications.
From time to time, the Fund may compare its performance against inflation
with the performance of other instruments against inflation, such as short-
term Treasury Bills (which are direct obligations of the U.S. Government)
and FDIC-insured bank money market accounts. In addition, advertising for
the Fund may indicate that investors may consider diversifying their
investment portfolios in order to seek protection of the value of their
assets against inflation.
Advertising materials for the Fund may include reference to the role
played by the Manager or Jack J. Dreyfus, Jr. in popularizing the concept
of mutual funds as an investment vehicle and may refer to the role The
Dreyfus Corporation and the Dreyfus Family of Funds play or have played in
the mutual fund industry, and the fact that the mutual fund industry, which
includes Dreyfus and the Dreyfus funds, has, through the wide variety of
innovative and democratic mutual fund products it has made available,
brought to the public investment opportunities once reserved for the few.
Advertising materials may also refer to various Dreyfus investor services,
including, for example, asset allocation and IRA rollover services. From
time to time advertising materials for the Fund also may refer to
Morningstar ratings and related analyses supporting the rating.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and
non-assessable. Fund shares have no preemptive or subscription rights and
are freely transferable.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT,
COUNSEL AND INDEPENDENT AUDITORS
The Bank of New York, 110 Washington Street, New York, New York
10286, acts as custodian of the Fund's assets. The Shareholder Services
Group, Inc., a subsidiary of First Data Corporation, P.O. Box 9671,
Providence, Rhode Island 02904-9671, is the Fund's transfer and dividend
disbursing agent. Neither The Bank of New York nor The Shareholder
Services Group, Inc. has any part in determining the investment policies of
the Fund or which portfolio securities are to be purchased or sold by the
Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York
10004-2696, as counsel for the Fund, has rendered its opinion as to certain
legal matters regarding the due authorization and valid issuance of the
shares of beneficial interest being sold pursuant to the Fund's Prospectus.
Ernst & Young, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of the Fund.
APPENDIX
Descriptions of Standard & Poor's Corporation ("S&P") and Moody's
Investors Service, Inc. ("Moody's") ratings.
S&P
Bond Ratings
AAA
Bonds rated AAA have the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in a small degree.
A
Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than
obligations in higher rated categories.
BBB
Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for bonds in this category than for bonds in
higher rated categories.
BB, B, CCC, CC, C
Bonds rated BB, B, CCC, CC and C are regarded as having predominantly
speculative characteristics with respect to capacity to pay interest and
repay principal in accordance with the terms of the obligation. BB
indicates the lowest degree of speculation and CC the highest degree of
speculation. While such bonds will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.
BB
Bonds rated BB have less near-term vulnerability to default than other
speculative grade debt. However, they face major ongoing uncertainties or
exposure to adverse business, financial or economic conditions which could
lead to inadequate capacity to meet timely interest and principal payments.
B
Bonds rated B have a greater vulnerability to default but presently
have the capacity to meet interest payments and principal repayments.
Adverse business, financial or economic conditions would likely impair
capacity or willingness to pay interest and repay principal.
CCC
Bonds rated CCC have a current identifiable vulnerability to default,
and are dependent upon favorable business, financial and economic
conditions to meet timely payments of interest and repayment of principal.
In the event of adverse business, financial or economic conditions, they
are not likely to have the capacity to pay interest and repay principal.
CC
The rating CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC- rating.
C
The rating C is typically applied to income bonds on which no interest
is being paid.
Plus (+) or minus (-): The ratings from AA to CCC may be modified by
the addition of a plus or minus sign to show relative standing within the
major ratings categories.
Commercial Paper Ratings
An S&P commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more
than 365 days. Issues assigned an A rating are regarded as having the
greatest capacity for timely payment. Issues in this category are
delineated with the numbers 1, 2 and 3 to indicate the relative degree of
safety.
A-1
This designation indicates the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted with a plus sign
(+) designation.
A-2
Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as high as for issues
designated "A-l."
A-3
Issues carrying this designation have a satisfactory capacity for
timely payment. They are, however, somewhat more vulnerable to the adverse
effects of changes in circumstances than obligations carrying the higher
designations.
Moody's
Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are
known as high-grade bonds. They are rated lower than the best bonds
because margins of protection may not be as large in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities.
A
Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium-grade obligations. Factors giving
security to principal and interest are considered adequate, but elements
may be present which suggest a susceptibility to impairment sometime in the
future.
Baa
Bonds which are rated Baa are considered as medium-grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security may appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding
investment characteristics and in fact have speculative characteristics as
well.
Ba
Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate, and therefore not
well safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class.
B
Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may
be small.
Caa
Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.
Ca
Bonds which are rated Ca present obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category and
in the categories below B. The modifier 1 indicates a ranking for the
security in the higher end of a rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates a ranking in the lower end
of a rating category.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but
to a lesser degree. Earnings trends and coverage ratios, while sound, will
be more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
Issuers (or related supporting institutions) rated Prime-3 (P-3) have
an acceptable capacity for repayment of short-term promissory obligations.
The effect of industry characteristics and market composition may be more
pronounced. Variability in earnings and profitability may result in
changes in the level of debt protection measurements and the requirements
for relatively high financial leverage. Adequate alternate liquidity is
maintained.
<TABLE>
<CAPTION>
DREYFUS STRATEGIC INVESTING
STATEMENT OF INVESTMENTS OCTOBER 31, 1993
COMMON STOCKS--98.7%
SHARES VALUE
------- ------------
BASIC INDUSTRIES--6.8%
<S> <S> <S>
Chemicals--3.1% Hercules.............................. 75,000 $ 7,462,500
OM Group.............................. 115,000 1,955,000
------------
9,417,500
------------
Metals--1.4% Huntco Cl. A.......................... 115,000 4,140,000
Mining--2.3% American Barrick Resources............ 50,000 1,356,250
Placer Dome........................... 125,000 3,046,875
Royal Oak Mines....................... 500,000(a) 2,468,750
------------
6,871,875
------------
TOTAL BASIC INDUSTRIES.............. 20,429,375
============
CAPITAL GOODS--2.9%
Machinery & Industrial--2.9% Allied Products....................... 110,000 1,333,750
Danaher............................... 85,000 2,975,000
Illinois Tool Works................... 120,000 4,485,000
------------
TOTAL CAPITAL GOODS................. 8,793,750
============
CAPITAL GOODS/TECHNOLOGY--23.7%
Electrical Equipment--1.3% Linear Technology .................... 125,000 4,093,750
------------
Electronics/Semiconductors--9.9% Applied Materials..................... 150,000(a) 4,725,000
Arrow Electronics..................... 100,000 3,712,500
Atmel................................. 55,000(a) 1,512,500
Avnet................................. 50,000 1,962,500
Blyth Holdings........................ 60,000(a) 900,000
Kenetech.............................. 100,000(a) 1,562,500
Lam Research Corp..................... 175,000(a) 4,637,500
Mercury Interactive................... 22,200 413,475
Motorola.............................. 80,000 8,380,000
Sapiens International................. 75,000(a) 2,081,250
------------
29,887,225
============
Information Processing--5.9% Cabletron Systems...................... 75,000(a) 6,918,750
Cisco Systems.......................... 55,000(a) 2,818,750
Olicom A/S............................. 90,000(a) 1,260,000
Oracle Systems......................... 115,000(a) 6,813,750
------------
17,811,250
============
Telecommunications--6.6% Andrew Corp............................ 125,000(a) 4,718,750
DSC Communications..................... 125,000(a) 8,203,125
Mobil TeleCommunications............... 125,000(a) 3,765,625
Pittencriff............................ 85,000(a) 3,123,750
------------
19,811,250
------------
TOTAL CAPITAL GOODS/TECHNOLOGY....... 71,603,475
============
CONGLOMERATES--2.7%
Paramount Communications................ 100,000 $ 8,037,500
============
CONSUMER CYCLICAL--14.1%
Auto/Car--2.3% Chrysler................................ 100,000 5,600,000
Motor Coach Industries International....... 100,000 1,250,000
------------
6,850,000
------------
Auto/Replacement Parts--2.5% Allen Group................................ 105,000 2,362,500
Masland.................................... 123,500 2,114,937
------------
Standard Motor Products.................... 125,000 2,968,750
------------
7,446,187
------------
Footwear--.9% Timberland, Cl. A.......................... 35,000(a) 2,751,875
------------
Lodging--1.6% Hospitality Franchise...................... 115,000(a) 4,801,250
------------
Merchandising/Mass--6.1% Land's End................................. 100,000 4,250,000
Nordstrom.................................. 100,000 3,475,000
Sears Roebuck............................ 125,000 7,171,875
Spiegel Cl. A............................ 15,000 585,000
Williams-Sonoma.......................... 115,000(a) 3,047,500
------------
18,529,375
------------
Textiles--.7% Charter Golf............................. 50,000(a) 581,250
Mohawk Industries........................ 60,000(a) 1,695,000
------------
2,276,250
------------
TOTAL CONSUMER CYCLICAL................ 42,654,937
============
CONSUMER GROWTH STAPLES--19.4%
Broadcasting--1.3% ACS Enterprises.......................... 10,000(a) 505,000
Cablevision System Cl. A................. 50,000(a) 3,493,750
------------
3,998,750
------------
Drugs--2.6% Aramed Callable (Units).................. 50,000(a) 1,275,000
Genelabs Technologies.................... 111,111(a,f) 500,000
Gensia Inc............................... 115,000(a) 3,263,125
Gensia (Warrants)........................ 75,000(a) 1,256,250
Immunex (Warrants)....................... 95,000(a) 1,674,375
------------
7,968,750
------------
Entertainment--14.2% Bally Gaming International............... 110,000(a) 2,475,000
Blockbuster Entertainment................ 65,000 1,844,375
Boomtown................................. 50,000(a) 987,500
Club Car................................. 75,000 1,293,750
GTECH Holdings........................... 130,000(a) 4,338,750
Grand Casinos............................ 110,000(a) 2,750,000
Hollywood Park.......................... 110,000 3,300,000
Iwerks.................................. 45,000 1,541,250
Lodgenet................................ 75,000 1,237,500
Players International................... 230,000(a) 5,462,500
President Riverboat Casino.............. 113,000(a) 4,830,750
Promus.................................. 55,000 4,028,750
Sodak Gaming............................ 75,000(a) 2,568,750
Showboat................................ 165,000 3,279,375
WMS Industries.......................... 100,000 2,937,500
------------
42,875,750
------------
Food Service/Restaurants--1.3% D W G Corp.............................. 125,000 3,859,375
------------
TOTAL CONSUMER GROWTH STAPLES......... 58,702,625
============
CREDIT CYCLICAL--1.1%
Building Materials--1.1% National Gypsum......................... 125,000(a) 3,312,500
============
ENERGY--8.0%
Natural Gas--1.7% Seagull Energy........................... 150,000(a) 4,200,000
USX-Delhi Group.......................... 50,000 975,000
------------
5,175,000
------------
Oil & Gas Production--6.3% Apache................................... 125,000 3,328,125
Enron Oil & Gas.......................... 80,000 3,420,000
Noble Affiliates......................... 135,000 3,763,125
Nuevo Energy............................. 100,000(a) 2,300,000
Pogo Producing........................... 136,000 2,482,000
Union Texas Petroleum.................... 165,000 3,630,000
------------
18,923,250
------------
TOTAL ENERGY........................... 24,098,250
============
FINANCIAL--7.8%
Banking--1.2% Citicorp................................. 100,000 3,625,000
------------
Finance--4.1% Bear Stearns............................. 100,000 2,200,000
Green Tree Acceptance.................... 100,000 5,750,000
Schwab (Chas)............................ 125,000 4,312,500
------------
12,262,500
------------
Insurance--2.5% Mercury General........................... 95,000 3,277,500
NWNL Companies............................ 80,000 2,720,000
Paul Revere............................... 36,000 900,000
Progressive............................... 15,000 686,250
------------
7,583,750
------------
TOTAL FINANCIAL......................... 23,471,250
============
TRANSPORTATION--.9%
Airlines--.9% Southwest Airlines........................ 85,000 2,635,000
============
UTILITIES--1.8%
Southwestern Bell......................... 70,000 3,097,500
U.S. West................................. 45,000 2,255,625
------------
TOTAL UTILITIES......................... 5,353,125
============
FOREIGN--9.5%
Berjaya Sports Toto........................ 1,120,000 2,408,000
Cheung Kong Holdings....................... 650,000 3,069,300
Genting Berhad............................. 159,000 1,647,240
Guoco Group................................ 385,000 1,681,295
HSBC Holdings.............................. 225,200 2,607,816
Hutchinson Whampoa......................... 1,120,000 4,216,800
Malayan Banking Berhad..................... 575,000 3,978,425
New Straits Times.......................... 570,000 1,949,970
Resorts World.............................. 550,000 3,010,150
United Engineers........................... 285,000 1,348,050
World International........................ 1,300,000 2,775,500
------------
TOTAL FOREIGN............................ 28,692,546
============
TOTAL COMMON STOCKS
(cost $260,437,333)...................... $297,784,333
============
CALL OPTIONS--1.4%
CONTRACTS
SUBJECT TO
CALL
----------
German Bank Stocks, March '94 at $4,097.43... 42,841(c,f) $ 465,005
German Bank Stocks, March '94 at $4,112.08... 284,594(c,f) 3,022,106
NOTIONAL
AMOUNT
--------
French Franc Interest Rate Swap, July '95... 75,383,198(b,e,f) 838,273
------------
TOTAL CALL OPTIONS
(cost $3,283,028)......................... $ 4,325,384
============
SHORT-TERM INVESTMENTS--6.6%
PRINCIPAL
AMOUNT
-----------
U.S. Treasury Bills--6.6% 3.12%, 11/26/93............................ $ 3,784,000(d) $ 3,775,932
3.57%, 12/16/93............................ 16,113,000(d) 16,053,785
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $19,829,717)....................... $ 19,829,717
============
TOTAL INVESTMENTS (cost $283,550,078)............................................... 106.7% $321,939,434
===== ============
LIABILITIES, LESS CASH AND RECEIVABLES.............................................. (6.7%) $(20,084,050)
============
NET ASSETS.......................................................................... 100.0% $301,855,384
============
See notes to financial statements.
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Denominated in French Francs.
(c) Denominated in German Deutsche Marks.
(d) Partially held by brokers as collateral for open short positions.
(e) Based on fixed rate of 5.90% versus PIBOR, (Paris Interbank Offering
Rate).
(f) Securities restricted as to public resale. Investments in restricted
securities, with an aggregate market value of $4,825,384,represents
approximately 1.6% of net assets:
<TABLE>
<CAPTION>
Acquisition Purchase Percentage of
Issuer Date Price Net Assets Valuation*
- ------ ----------- -------- ------------- ----------
<S> <C> <C> <C> <C>
French Franc Interest Rate Swap, July '95....... 7/30/93 $0.013 .28% $ 0.011
Genelabs Technologies........................... 3/1/91 9.000 .17 4.50
German Bank Stocks:
March '94 at $4,097.43....................... 3/2/93 7.050 .15 10.85
March '94 at $4,112.08....................... 3/8/93 7.030 1.00 10.619
- -----
* The valuation of these securities has been determined in good faith
under the direction of the Board of Trustees.
STATEMENT OF SECURITIES SOLD SHORT OCTOBER 31, 1993
COMMON STOCKS SHARES VALUE
- ------------- ------ -----------
Artra Group............................................ 55,776 $ 348,600
Church & Dwight........................................ 35,000 905,625
Elcor.................................................. 41,700 943,462
Health Images.......................................... 40,500 207,563
Liz Claiborne.......................................... 40,000 760,000
McCormick & Co. ....................................... 20,000 472,500
Medco Research......................................... 75,000 890,625
Philip Morris.......................................... 25,000 1,343,750
Plains Resources....................................... 40,000 355,000
Policy Management System............................... 65,000 1,820,000
Sequent Computers...................................... 25,000 425,000
Stone Container........................................ 100,000 712,500
U.S. Filter............................................ 30,000 712,500
V.F. Corp. ............................................ 70,000 2,773,750
-----------
TOTAL SECURITIES SOLD SHORT (proceeds $15,746,133)..... $12,670,875
===========
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS STRATEGIC INVESTING
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1993
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $283,550,078)-see statement........................................ $321,939,434
Cash....................................................................... 3,013,691
Receivable for investment securities sold.................................. 18,445,508
Receivable from brokers for proceeds on securities sold short.............. 15,746,133
Receivable for shares of Beneficial Interest subscribed.................... 370,407
Dividends and interest receivable.......................................... 310,189
Prepaid expenses........................................................... 77,738
------------
359,903,100
LIABILITIES:
Due to The Dreyfus Corporation......................................... $ 269,061
Bank loans payable--Note 2.............................................. 35,100,000
Securities sold short, at value
(proceeds $15,746,133)--see statement.................................. 12,670,875
Payable for investment securities purchased............................. 9,353,524
Payable for shares of Beneficial Interest redeemed...................... 385,463
Loan commitment fees and interest payable............................... 101,789
Accrued expenses........................................................ 167,004 58,047,716
----------- ------------
NET ASSETS................................................................ $301,855,384
============
REPRESENTED BY:
Paid-in capital........................................................ $230,924,138
Accumulated distributions in excess of investment income-net........... (140,172)
Accumulated undistributed net realized gain on investments............. 29,606,804
Accumulated net unrealized appreciation on investments--Note 4(b)...... 41,464,614
------------
NET ASSETS at value...................................................... $301,855,384
============
Shares of Beneficial Interest outstanding:
Class A Shares
(unlimited number of $.001 par value authorized)..................... 11,613,078
============
Class B Shares
(unlimited number of $.001 par value authorized)..................... 1,093,545
============
NET ASSET VALUE per share:
Class A Shares ($276,021,707 divide 11,613,078 shares)................. $23.77
======
Class B Shares ($25,833,677 divide 1,093,545 shares)................... $23.62
======
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>trategic Investing
STATEMENT OF OPERATIONS YEAR ENDED OCTOBER 31, 1993
INVESTMENT INCOME:
INCOME: <C> <C>
<S>
Interest............................................................. $ 2,772,844
Cash dividends (net of $25,240 foreign taxes withheld at source)..... 2,348,524
-----------
TOTAL INCOME....................................................... $ 5,121,368
EXPENSES:
Management fee--Note 3(a)............................................ 2,022,123
Shareholder servicing costs--Note 3(b,c)............................. 1,020,231
Interest--Note 2..................................................... 676,615
Dividends on securities sold short................................... 525,143
Prospectus and shareholders' reports--Note 3(b)...................... 138,024
Custodian fees....................................................... 111,680
Professional fees.................................................... 73,011
Distribution fees (Class B shares)--Note 3(b)........................ 69,493
Loan commitment fees--Note 2......................................... 67,292
Registration fees.................................................... 46,899
Trustees' fees and expenses--Note 3(d)............................... 18,436
Miscellaneous........................................................ 7,845
----------- -----------
TOTAL EXPENSES..................................................... 4,776,792
-----------
INVESTMENT INCOME--NET............................................. 344,576
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain (loss) on investments--Note 4(a):
Long transactions (including options transactions)................... $41,200,944
Short sale transactions.............................................. (9,956,546)
Net realized gain (loss) on financial futures--Note 4(a):
Long transactions.................................................... 1,119,992
Short transactions................................................... (545,475)
-----------
NET REALIZED GAIN.................................................... 31,818,915
Net unrealized appreciation on investments and securities
sold short (including $481,625 net unrealized appreciation
on financial futures)................................................ 15,782,474
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS.................... 47,601,389
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............. $47,945,965
===========
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
Dreyfus Strategic Investing
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED OCTOBER 31,
--------------------------------
1992 1993
------------ ------------
OPERATIONS:
<S> <C> <C>
Investment income--net...................................................... $ 449,065 $ 344,576
Net realized gain (loss) on investments..................................... (1,975,054) 31,818,915
Net unrealized appreciation (depreciation) on investments for the year...... (7,123,579) 15,782,474
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS......... (8,649,568) 47,945,965
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net:
Class A shares............................................................ (990,789) (549,763)
Class B shares............................................................ -- --
Net realized gain on investments:
Class A shares............................................................ (11,445,313) --
Class B shares............................................................ -- --
------------ ------------
TOTAL DIVIDENDS......................................................... (12,436,102) (549,763)
------------ ------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares............................................................ 138,377,702 52,366,131
Class B shares............................................................ -- 25,107,551
Dividends reinvested:
Class A shares............................................................ 11,549,335 494,336
Class B shares............................................................ -- --
Cost of shares redeemed:
Class A shares............................................................ (31,410,916) (66,014,198)
Class B shares............................................................ -- (642,448)
------------ ------------
INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS............ 118,516,121 11,311,372
------------ ------------
TOTAL INCREASE IN NET ASSETS.......................................... 97,430,451 58,707,574
NET ASSETS:
Beginning of year........................................................... 145,717,359 243,147,810
------------ ------------
End of year [including undistributed investment income--net;
$65,015 in 1992 and distributions in excess of investment
income--net; ($140,172) in 1993]......................................... $243,147,810 $301,855,384
============ ============
SHARES
-------------------------------------------
CLASS A CLASS B
--------------------------- ------------
YEAR ENDED OCTOBER 31, YEAR ENDED
--------------------------- OCTOBER 31,
1992 1993 1993(1)
--------- --------- ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold...................................................... 6,608,598 2,402,790 1,122,136
Shares issued for dividends reinvested........................... 563,657 24,079 --
Shares redeemed.................................................. (1,540,795) (3,034,139) (28,591)
--------- --------- ------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING................ 5,631,460 (607,270) 1,093,545
========= ========= ============
- -----------
(1) From January 15, 1993 (commencement of initial offering) to
October 31, 1993.
See notes to financial statements.
</TABLE>
DREYFUS STRATEGIC INVESTING
FINANCIAL HIGHLIGHTS
Reference is made to page 2 of the Prospectus dated January 28, 1993.
DREYFUS STRATEGIC INVESTING
NOTES TO FINANCIAL STATEMENTS
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940
("Act") as a non-diversified open-end management investment company.
Dreyfus Service Corporation ("Distributor") acts as the distributor of
the Fund's shares. The Distributor is a wholly-owned subsidiary of The
Dreyfus Corporation ("Manager").
On July 24, 1992, shareholders approved an amendment to the Fund's
Agreement and Declaration of Trust to provide for the issuance of
additional classes of shares. On November 18, 1992, the Fund's Board of
Trustees classified the Fund's existing shares into Class A shares and
authorized an unlimited number of $.001 par value Class B shares. The
Fund began offering both Class A and Class B shares on January 15, 1993.
Class A shares are subject to a sales charge imposed at the time of
purchase and Class B shares are subject to a contingent deferred sales
charge imposed at the time of redemption on redemptions made within six
years of purchase. Other differences between the two Classes include the
services offered to and the expenses borne by each Class and certain
voting rights.
(A) PORTFOLIO VALUATION: Investments in securities (including options
and financial futures) are valued at the last sales price on the
securities exchange on which such securities are primarily traded or at
the last sales price on the national securities market. Securities not
listed on an exchange or the national securities market, or securities
for which there were no transactions, are valued at the average of the
most recent bid and asked prices, except for open short positions, where
the asked price is used for valuation purposes. Bid price is used when
no asked price is available. Securities for which there are no such
valuations are valued at fair value as determined in good faith under
the direction of the Board of Trustees. Short-term investments are
carried at amortized cost, which approximates value. Investments traded
in foreign currencies are translated to U.S. dollars at the prevailing
rates of exchange.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss
from securities transactions are recorded on the identified cost basis.
Dividend income is recognized on the ex-dividend date and interest
income, including, where applicable, amortization of discount on
investments, is recognized on the accrual basis.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-
dividend date. Dividends from investment income-net and dividends from
net realized capital gain are normally declared and paid annually, but
the Fund may make distributions on a more frequent basis to comply with
the distribution requirements of the Internal Revenue Code. To the
extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such
gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in
the best interests of its shareholders, by complying with the provisions
available to certain investment companies, as defined in applicable
sections of the Internal Revenue Code, and to make distributions of
taxable income sufficient to relieve it from all, or substantially all,
Federal income taxes.
NOTE 2--BANK LINE OF CREDIT:
In accordance with an agreement with a bank, the Fund may borrow up to
$60 million under a short-term unsecured line of credit. In connection
therewith, the Fund has agreed to pay commitment fees at an annual rate
of .125 of 1% on the total line of credit. Interest on borrowings is
charged at rates which are related to the Federal Funds rates in effect
from time to time.
Outstanding borrowings on October 31, 1993 under the line of credit,
amounted to $35.1 million, at an annualized interest rate 4.04%.
The average daily amount of short-term debt outstanding during the year
ended October 31, 1993 was approximately $16.4 million, with a related
weighted average annualized interest rate of 4.12% (based upon actual
interest expense, not including commitment fees, for the year). The
maximum amount of such debt outstanding at any time during the year
ended October 31, 1993, was $55.7 million.
NOTE 3--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .75 of 1% of the
average daily value of the Fund's net assets and is payable monthly. The
Agreement provides for an expense reimbursement from the Manager should
the Fund's aggregate expenses, exclusive of taxes, interest on
borrowings (which, in the view of Stroock & Stroock & Lavan, counsel to
the Fund, also contemplates loan commitment fees and dividends on
securities sold short), brokerage and extraordinary expenses, exceed the
expense limitation of any state having jurisdiction over the Fund. The
most stringent state expense limitation applicable to the Fund presently
requires reimbursement of expenses in any full fiscal year that such
expenses (exclusive of distribution expenses and certain expenses as
described above) exceed 21/2% of the first $30 million, 2% of the next
$70 million and 11/2% of the excess over $100 million of the average
value of the Fund's net assets in accordance with California "blue sky"
regulations. There was no expense reimbursement for the year ended
October 31, 1993.
The Distributor retained $561,439 during the year ended October 31,
1993 from commissions earned on sales of the Fund's Class A shares.
The Distributor retained $18,382 during the period ended October 31,
1993 from contingent deferred sales charges imposed upon redemptions of
the Fund's Class B shares.
(B) Under the Distribution Plan ("Class B Distribution Plan") adopted
pursuant to Rule 12b-1 under the Act, effective January 15, 1993, the
Fund pays the Distributor, at an annual rate of .75 of 1% of the value
of the Fund's Class B shares average daily net assets, for costs and
expenses in connection with advertising, marketing and distributing the
Fund's Class B shares. The Distributor may make payments to one or more
Service Agents (a securities dealer, financial institution, or other
industry professional) based on the value of the Fund's Class B shares
owned by clients of the Service Agent.
Prior to January 15, 1993, the Fund's Service Plan ("prior Service
Plan") provided that the Fund pays the Distributor, at an annual rate of
.25 of 1% of the value of the Fund's average daily net assets, for costs
and expenses in connection with advertising, marketing and distributing
the Fund's shares and for servicing shareholder accounts. The
Distributor made payments to one or more Service Agents based on the
value of the Fund's shares owned by clients of the Service Agent. The
prior Service Plan also provided for the Fund to bear the costs of
preparing, printing and distributing certain of the Fund's prospectuses
and statements of additional information and costs associated with
implementing and operating the Plan, not to exceed the greater of
$100,000 or .005 of 1% of the Fund's average daily net assets for any
full fiscal year.
During the period ended October 31, 1993, $128,633 was charged to the
Fund pursuant to the prior Service Plan and $69,493 was charged to the
Fund pursuant to the Class B Distribution Plan.
(C) Under the Shareholder Services Plan, effective January 15, 1993,
the Fund pays the Distributor, at an annual rate of .25 of 1% of the
value of the average daily net assets of Class A and Class B shares for
servicing shareholder accounts. The services provided may include
personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder
accounts. The Distributor may make payments to Service Agents in respect
of these services. The Distributor determines the amounts to be paid to
Service Agents. For the period ended October 31, 1993, $650,877 and
$23,164 were charged to the Class A and Class B shares, respectively,
pursuant to the Shareholder Services Plan.
(D) Certain officers and trustees of the Fund are "affiliated
persons," as defined in the Act, of the Manager and/or the Distributor.
Each trustee who is not an "affiliated person" receives an annual fee of
$2,500 and an attendance fee of $250 per meeting.
NOTE 4--SECURITIES TRANSACTIONS:
(A) The following summarizes the aggregate amount of purchases and
sales of investment securities and securities sold short, excluding
short-term securities and options transactions, during the year ended
October 31, 1993:
<TABLE>
PURCHASES SALES
------------ ------------
<S> <C> <C>
Long transactions............................... $585,999,920 $559,029,080
Short sale transactions......................... 200,006,842 147,048,261
Total........................................ $786,006,762 $706,077,341
============ ============
In addition, the following table summarizes the Fund's option
transactions for the year ended October 31, 1993.
</TABLE>
<TABLE>
<CAPTION>
OPTIONS TERMINATED
------------------
NET
NUMBER OF PREMIUMS REALIZED
CONTRACTS RECEIVED COST GAIN
--------- -------- ---- --------
OPTIONS WRITTEN:
<S> <C> <C> <C> <C>
Contracts outstanding October 31, 1992............. -- $ --
Contracts written. ................................ 17,700 43,718
------ --------
17,700 43,718
------ --------
Contracts Terminated;
Expired.......................................... 17,700 43,718 -- $43,718
------ -------- ---- -------
Contracts outstanding October 31, 1993............. -- $ --
====== ========
</TABLE>
As a writer of put options, the Fund receives a premium at the outset
and then bears the market risk of unfavorable changes in the price of
the financial instrument underlying the option. Generally, the Fund
would incur a gain if the price of the underlying financial instrument
increases between the date the option is written and the date on which
the option is terminated. Generally, the Fund would realize at loss, to
the extent of the premiums, if the price of the financial instrument
declines between those dates.
The Fund is engaged in short-selling which obligates the Fund to
replace the security borrowed by purchasing the security at current
market value. The Fund would incur a loss if the price of the security
increases between the date of the short sale and the date on which the
Fund replaces the borrowed security. The Fund would realize a gain if
the price of the security declines between those dates. Until the Fund
replaces the borrowed security, the Fund will maintain daily, a
segregated account with a broker and custodian, of cash and /or U.S.
Government securities sufficient to cover its short position. Securities
sold short at October 31, 1993 and their related market values and
proceeds are set forth in the Statement of Securities Sold Short.
The Fund is engaged in trading financial futures contracts. The Fund
is exposed to market risk as a result of changes in the value of the
underlying financial instruments. Investments in financial futures
require the Fund to "mark to market" on a daily basis, which reflects
the change in the market value of the contract at the close of each
day's trading. Accordingly, variation margin payments are made or
received to reflect daily unrealized gains or losses. When the contracts
are closed, the Fund recognizes a realized gain or loss. These
investments require initial margin deposits with a custodian, which
consist of cash or cash equivalents, up to approximately 10% of the
contract amount. The amount of these deposits is determined by the
exchange or Board of Trade on which the contract is traded and is
subject to change. At October 31, 1993, there were no financial futures
contracts outstanding.
(B) At October 31, 1993, accumulated net unrealized appreciation on
investments was $41,464,614, consisting of $50,346,388 gross unrealized
appreciation and $8,881,774 gross unrealized depreciation.
At October 31, 1993, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS STRATEGIC INVESTING
REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS STRATEGIC INVESTING
We have audited the accompanying statement of assets and liabilities
of Dreyfus Strategic Investing, including the statements of investments
and securities sold short, as of October 31, 1993, and the related
statements of operations and cash flows for the year then ended, the
statement of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the years
indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is
to express an opinion on these financial statements and financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included
confirmation of securities owned as of October 31, 1993 by
correspondence with the custodian and brokers. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of Dreyfus Strategic Investing at October 31, 1993,
the results of its operations and its cash flows for the year then
ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for each of the
indicated years, in conformity with generally accepted accounting
principles.
Ernst & Young
New York, New York
December 10, 1993
DREYFUS STRATEGIC INVESTING
PART C. OTHER INFORMATION
_________________________
Item 24 Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement:
Condensed Financial Information- for the period from October
1, 1986 (commencement of operations) to October 31, 1986 and
for each of the seven years in the period ended October 31,
1993.
Included in Part B of the Registration Statement:
Statement of Investments--October 31, 1993.
Statement of Securities Sold Short--October 31, 1993.
Statement of Assets and Liabilities--October 31, 1993.
Statement of Operations--Year ended October 31, 1993.
Statement of Changes in Net Assets--for each of the
years ended October 31, 1992 and 1993.
Statement of Cash Flows--Year ended October 31, 1993.
Notes to Financial Statements.
Report of Ernst & Young, Independent Auditors, dated
December 10, 1993.
Schedule Nos. I through VII and other Financial Statement information, for
which provision is made in the applicable accounting regulations of the
Securities and Exchange Commission, are either omitted because they are not
required under the related instructions, they are inapplicable, or the
required information is presented in the financial statements or notes
thereto which are included in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1) Registrant's Restated and Amended Agreement Declaration of Trust,
as amended, is incorporated by reference to Exhibit (1) of
Post-Effective Amendment No. 11 to the Registration Statement on
Form N-1A, filed on October 30, 1992.
(2) Registrant's By-Laws are incorporated by reference to Exhibit (2)
of Post-Effective Amendment No. 1 to the Registration Statement on
Form N-1A, filed on February 26, 1987.
(4) The specimen copy of a share certificate is incorporated by
reference to Exhibit (4) of Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-1A, filed on October 14, 1986.
(5) Form of Registrant's Management Agreement, as amended is
incorporated by reference to Exhibit (5) of Post-Effective
Amendment No. 11 to the Registration Statement on Form N-1A, filed
on October 30, 1992.
(6)(a) Form of Distribution Agreement, as amended is incorporated by
reference to Exhibit (6)(a) of Post-Effective Amendment No. 11 to
the Registration Statement on Form N-1A, filed on October 30,
1992.
(b) Forms of Shareholder Service Agreement and Distribution Plan
Agreement are incorporated by reference to Exhibit 6(b) and
(6)(c)of Post-Effective Amendment No. 11 to the Registration
Statement on Form N-1A, filed on October 30, 1992.
(c) The Sales Agreement is incorporated by reference to Exhibit (6) of
Pre-Effective Amendment No. 1 to the Registration Statement on
Form N-1A, filed on October 14, 1986.
(8) The Custody Agreement between the Fund and the Bank of New York
dated February 8, 1990 is incorporated by reference to Exhibit 8
of Post-Effective Amendment No. 8 to the Registration Statement on
Form N-1A, filed on March 1, 1991.
(10) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-1A, filed on October 14, 1986.
(11) Consent of Independent Auditors.
(14) Documents making up model plans in the establishment of retirement
plans in conjunction with which Registrant offers its securities
are incorporated by reference to Exhibit (14) of Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-1A, filed
on October 14, 1986.
(15)(a) Form of Shareholder Service Plan is incorporated by reference to
Exhibit (15)(a) if Post-Effective Amendment No. 11 to the
Registration Statement on Form N-1A, filed on October 30, 1992.
(15)(b) Form of Distribution Plan relating to Class B shares is
incorporated by reference to Exhibit (15)(b) of Post-Effective
Amendment No. 11 to the Registration Statement on Form N-1A, filed
on October 30, 1992.
(16) Schedules of Computation of Performance Data.
Other Exhibits
(a) Powers of Attorney are incorporated by reference to
Exhibits following the signature page of Post-Effective
Amendments Nos. 4, 8 and 11. Additional Powers of
Attorney are enclosed herein.
(b) Certificate of Secretary is incorporated by reference to
Exhibits following the signature page of Post-Effective
Amendment No. 4 to the Registration Statement on Form
N-1A, filed on February 17, 1989. An additional
Certificate of Secretary is enclosed herein.
Item 25. Persons Controlled by or under Common Control with Registrant.
Not Applicable
Item 26. Number of Holders of Securities.
(1) (2)
Number of Record
Title of Class Holders as of December 22, 1993
------------- --------------------------------
Shares of Beneficial Interest Class A=17,063
Par value $.001 Class B= 2,569
Item 27. Indemnification
The Statement as to the general effect of any contract,
arrangements or statute under which a director, officer,
underwriter or affiliated person of the Registrant is indemnified,
is incorporated by reference to Item 4 of Part II of Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-1A, filed
on October 14, 1986.
Reference is also made to the Distribution Agreement attached as
Exhibit (6) thereto.
Item 28. Business and Other Connections of Investment Adviser.
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business
consists primarily of providing investment management services
as the investment adviser, manager and distributor for sponsored
investment companies registered under the Investment Company Act
of 1940 and as an investment adviser to institutional and
individual accounts. Dreyfus also serves as sub-investment
adviser to and/or administrator of other investment companies.
Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, serves primarily as distributor of shares of investment
companies sponsored by Dreyfus and of other investment companies
for which Dreyfus acts as investment adviser, sub-investment
adviser or administrator. Dreyfus Management, Inc., another
wholly-owned subsidiary, provides investment management services
to various pension plans, institutions and individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Director of Independence One Investment
Services, Inc.
Division of Michigan National Corp.
27777 Inkster Road
Farmington Hills, Michigan 48018;
Past Chairman of the Board of Trustees of
Skillman Foundation
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and member of the Executive
Committee of Avnet, Inc.
767 Fifth Avenue
New York, New York 10153
ABIGAIL Q. McCARTHY Author, lecturer, columnist and educational
Director consultant
2126 Connecticut Avenue
Washington, D.C. 20008
DAVID B. TRUMAN Educational consultant;
Director Past President of the Russell Sage Foundation
230 Park Avenue
New York, New York 10017;
Past President of Mount Holyoke College
South Hadley, Massachusetts 01075;
Former Director:
Student Loan Marketing Association
1055 Thomas Jefferson Street, N.W.
Washington, D.C. 20006;
Former Trustee:
College Retirement Equities Fund
730 Third Avenue
New York, New York 10017
HOWARD STEIN Chairman of the Board, President and Investment
Chairman of the Board and Officer:
Chief Executive Officer The Dreyfus Leverage Fund, Inc.++;
Chairman of the Board and Investment Officer:
The Dreyfus Fund Incorporated++;
HOWARD STEIN Dreyfus New Leaders Fund, Inc.++;
(cont'd) The Dreyfus Third Century Fund, Inc.++;
Chairman of the Board:
Dreyfus Acquisition Corporation*;
Dreyfus America Fund++++;
The Dreyfus Consumer Credit Corporation*;
Dreyfus Land Development Corporation*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
The Dreyfus Trust Company (N.J.)++;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
President, Managing General Partner and
Investment Officer:
The Dreyfus Convertible Securities Fund,
Inc.++;
Dreyfus Strategic Growth, L.P.++;
Managing General Partner:
Dreyfus Investors GNMA Fund, L.P.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Strategic World Investing, L.P.++;
Director, President and Investment Officer:
Dreyfus Appreciation Fund, Inc.++;
Dreyfus Asset Allocation Fund, Inc.++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Growth Opportunity Fund, Inc.++;
Premier Growth Fund, Inc.++;
Director and President:
Dreyfus Life Insurance Company*;
Director and Investment Officer:
Dreyfus Growth and Income Fund, Inc.++;
President:
Dreyfus Consumer Life Insurance Company*;
President and Investment Officer:
Dreyfus Growth Allocation Fund, Inc.++;
Director:
Avnet, Inc.**;
Comstock Partners Strategy Fund, Inc.***;
Dreyfus A Bonds Plus, Inc.++;
Dreyfus BASIC Money Market Fund, Inc.++;
The Dreyfus Fund International
Limited++++++;
Dreyfus Global Investing, Inc.++;
Dreyfus Insured Municipal Bond Fund,
Inc.++;
Dreyfus Liquid Assets, Inc.++;
HOWARD STEIN Dreyfus Money Market Instruments, Inc.++;
(cont'd) Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus Partnership Management, Inc.*;
Dreyfus Personal Management, Inc.**;
Dreyfus Precious Metals, Inc.*;
Dreyfus Realty Advisors, Inc.+++;
Dreyfus Service Organization, Inc.*;
Dreyfus Strategic Governments Income,
Inc.++;
The Dreyfus Trust Company++;
General Government Securities Money Market
Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
FN Network Tax Free Money Market Fund,
Inc.++;
Seven Six Seven Agency, Inc.*;
World Balanced Fund++++;
Trustee and Investment Officer:
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Strategic Investing++;
Dreyfus Variable Investment Fund++;
Trustee:
Corporate Property Investors
New York, New York;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Dreyfus California Tax Exempt Money Market
Fund++;
Dreyfus Institutional Money Market Fund++;
Dreyfus Institutional Short Term Treasury
Fund++;
Dreyfus Strategic Income++
JULIAN M. SMERLING Director and Executive Vice President:
Vice Chairman of the Dreyfus Service Corporation*;
Board of Directors Director and Vice President:
Dreyfus Consumer Life Insurance Company*;
Dreyfus Land Development Corporation*;
Dreyfus Life Insurance Company*;
Dreyfus Service Organization, Inc.*;
Vice Chairman and Director:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
Director:
The Dreyfus Consumer Credit Corporation*;
Dreyfus Partnership Management, Inc.*;
Seven Six Seven Agency, Inc.*
JOSEPH S. DiMARTINO Director and Chairman of the Board:
President, Chief Operating The Dreyfus Trust Company++;
Officer and Director Director, President and Investment Officer:
Dreyfus Cash Management Plus, Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
General Government Securities Money Market
Fund, Inc.++;
General Money Market Fund, Inc.++;
Director and President:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit Corporation*;
Dreyfus Edison Electric Index Fund,
Inc.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus-Lincoln, Inc.*;
Dreyfus Partnership Management, Inc.*;
The Dreyfus Trust Company (N.J.)++;
Dreyfus-Wilshire Target Funds, Inc.++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
Peoples Index Fund, Inc.++;
Peoples S&P MidCap Index Fund, Inc.++;
Trustee, President and Investment Officer:
Dreyfus Cash Management++;
Dreyfus Government Cash Management++;
Dreyfus Institutional Money Market Fund++;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
Dreyfus Variable Investment Fund++;
Premier GNMA Fund++;
Trustee and President:
First Prairie Cash Management++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Money Market
Fund++;
First Prairie U.S. Government Income
Fund++;
First Prairie U.S. Treasury Securities
Cash Management++;
Trustee, Vice President and Investment Officer:
Dreyfus Institutional Short Term
Treasury Fund++;
Director and Executive Vice President:
Dreyfus Service Corporation*;
Director, Vice President and Investment
Officer:
Dreyfus Balanced Fund, Inc.++;
Dreyfus International Equity Fund, Inc.++;
JOSEPH S. DiMARTINO Director and Vice President:
(cont'd) Dreyfus Life Insurance Company*;
Dreyfus Service Organization, Inc.*;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
Director and Investment Officer:
Dreyfus A Bonds Plus, Inc.++;
Dreyfus Appreciation Fund, Inc.++;
The Dreyfus Convertible Securities Fund,
Inc.++;
Dreyfus Short-Term Income Fund, Inc.++;
Premier Growth Fund, Inc.++;
Director and Corporate Member:
Muscular Dystrophy Association
810 Seventh Avenue
New York, New York 10019;
Director:
Dreyfus Management, Inc.**;
Noel Group, Inc.
667 Madison Avenue
New York, New York 10021;
Trustee:
Bucknell University
Lewisburg, Pennsylvania 17837;
President and Investment Officer:
Dreyfus BASIC Money Market Fund, Inc.++;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Vice President:
Dreyfus Consumer Life Insurance Company*;
Investment Officer:
The Dreyfus Fund Incorporated++;
Dreyfus Investors GNMA Fund, L.P.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
McDonald Money Market Fund, Inc.++;
McDonald U.S. Government Money Market
Fund, Inc.++;
President, Chief Executive Officer and
Director:
Dreyfus Personal Management, Inc.*;
President, Chief Operating Officer and
Director:
Major Trading Corporation*
LAWRENCE M. GREENE Chairman of the Board:
Legal Consultant and The Dreyfus Consumer Bank+;
Director Director and President:
Dreyfus Land Development Corporation*;
Director and Executive Vice President:
Dreyfus Service Corporation*;
Director and Vice President:
Dreyfus Acquisition Corporation*;
Dreyfus Consumer Life Insurance Company*;
Dreyfus Life Insurance Company*;
Dreyfus Service Organization, Inc.*;
Director:
Dreyfus America Fund++++;
Dreyfus BASIC Municipal Money Market Fund,
Inc.++;
Dreyfus California Tax Exempt Bond Fund,
Inc.++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus Management, Inc.**;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
Dreyfus Precious Metals, Inc.*;
Dreyfus Thrift & Commerce+++;
The Dreyfus Trust Company (N.J.)++;
Seven Six Seven Agency, Inc.*;
Vice President:
The Dreyfus Convertible Securities Fund,
Inc.++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus-Lincoln, Inc.*;
Trustee:
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
Dreyfus New York Tax Exempt Money Market
Fund++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Investment Officer:
The Dreyfus Fund Incorporated++
ROBERT F. DUBUSS Director and Treasurer:
Vice President Major Trading Corporation*;
Director and Vice President:
The Dreyfus Consumer Credit Corporation*;
Dreyfus Life Insurance Company*;
The Truepenny Corporation*;
Vice President:
Dreyfus Consumer Life Insurance Company*;
Treasurer:
Dreyfus Management, Inc.**;
Dreyfus Personal Management, Inc.**;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Corporation*;
Assistant Treasurer:
The Dreyfus Fund Incorporated++;
Controller:
Dreyfus Land Development Corporation*;
Director:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
Dreyfus Thrift & Commerce****
ALAN M. EISNER Director and President:
Vice President and Chief The Truepenny Corporation*;
Financial Officer Director, Vice President and Chief Financial
Officer:
Dreyfus Life Insurance Company*;
Vice President and Chief Financial Officer:
Dreyfus Acquisition Corporation*;
Dreyfus Consumer Life Insurance Company*;
Treasurer:
Dreyfus Realty Advisors, Inc.+++;
Treasurer, Financial Officer and Director:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
Director:
Dreyfus Thrift & Commerce****;
Vice President and Director:
The Dreyfus Consumer Credit Corporation*
DAVID W. BURKE Vice President and Director:
Vice President and Chief The Dreyfus Trust Company++;
Administrative Officer Formerly, President:
CBS News, a division of CBS, Inc.
524 West 57th Street
New York, New York 10019
ELIE M. GENADRY President:
Vice President - Institutional Services Division of Dreyfus
Institutional Sales Service Corporation*;
Executive Vice President:
Dreyfus Service Corporation*;
Senior Vice President:
Dreyfus Cash Management++;
Dreyfus Cash Management Plus, Inc.++;
ELIE M. GENADRY Dreyfus Edison Electric Index Fund,
(cont'd) Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Institutional Short Term
Treasury Fund++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus Tax Exempt Cash Management++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
Dreyfus-Wilshire Target Funds, Inc.++;
Peoples Index Fund, Inc.++;
Peoples S&P MidCap Index Fund, Inc.++;
Vice President:
The Dreyfus Trust Company++;
Premier California Insured Municipal
Bond Fund++;
Premier California Municipal Bond Fund++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Vice President-Sales:
The Dreyfus Trust Company (N.J.)++;
Treasurer:
Pacific American Fund+++++
DANIEL C. MACLEAN Director, Vice President and Secretary:
Vice President and General Dreyfus Precious Metals, Inc.*;
Counsel Director and Vice President:
The Dreyfus Consumer Credit Corporation*;
Dreyfus Personal Management, Inc.**;
The Dreyfus Trust Company (N.J.)++;
Director and Secretary:
Dreyfus Partnership Management, Inc.*;
Major Trading Corporation*;
McDonald Money Market Fund, Inc.++;
McDonald Tax Exempt Money Market Fund,
Inc.++;
McDonald U.S. Government Money Market
Fund, Inc.++;
The Truepenny Corporation+;
Director:
Dreyfus America Fund++++;
Dreyfus Consumer Life Insurance Company*;
Dreyfus Life Insurance Company*;
The Dreyfus Trust Company++;
Vice President:
Dreyfus Appreciation Fund, Inc.++;
Dreyfus BASIC Municipal Money Market Fund,
Inc.++;
Dreyfus California Tax Exempt Bond Fund,
Inc.++;
DANIEL C. MACLEAN Dreyfus California Tax Exempt Money Market
(cont'd) Fund++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Cash Management++;
Dreyfus Cash Management Plus, Inc.++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
Dreyfus Edison Electric Index Fund,
Inc.++;
Dreyfus Florida Intermediate Municipal
Bond Fund++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Growth and Income Fund, Inc.++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus Institutional Short Term
Treasury Fund++;
Dreyfus Insured Municipal Bond Fund,
Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus Investors GNMA Fund, L.P.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Insured Tax Exempt Bond
Fund++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
Dreyfus New York Tax Exempt Money Market
Fund++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Short-Intermediate Municipal Bond
Fund++;
Dreyfus Tax Exempt Cash Management++;
The Dreyfus Third Century Fund, Inc.++;
Dreyfus Treasury Cash Management++;
DANIEL C. MACLEAN Dreyfus Treasury Prime Cash Management++;
(cont'd) Dreyfus-Wilshire Target Funds, Inc.++;
First Prairie Cash Management++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
First Prairie Tax Exempt Money Market
Fund++;
First Prairie U.S. Government Income
Fund++;
First Prairie U.S. Treasury Securities
Cash Management++;
FN Network Tax Free Money Market Fund,
Inc.++;
General California Municipal Money Market
Fund++;
General Government Securities Money Market
Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
General New York Municipal Bond Fund,
Inc.++;
General New York Municipal Money Market
Fund++;
Peoples Index Fund, Inc.++;
Peoples S&P MidCap Index Fund, Inc.++;
Premier California Insured Municipal
Bond Fund++;
Premier California Municipal Bond Fund++;
Premier GNMA Fund++;
Premier Growth Fund, Inc.++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Premier State Municipal Bond Fund++;
Secretary:
Dreyfus A Bonds Plus, Inc.++;
Dreyfus Acquisition Corporation*;
Dreyfus Asset Allocation Fund, Inc.++;
Dreyfus Balanced Fund, Inc.++;
Dreyfus BASIC Money Market Fund, Inc.++;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Dreyfus California Intermediate Municipal
Bond Fund++;
Dreyfus California Municipal Income,
Inc.++;
Dreyfus Connecticut Intermediate Municipal
Bond Fund++;
The Dreyfus Convertible Securities Fund,
Inc.++;
The Dreyfus Fund Incorporated++;
Dreyfus Global Investing, Inc.++;
DANIEL C. MACLEAN Dreyfus Growth Allocation Fund,
(cont'd) Inc.++;
Dreyfus Institutional Money Market Fund++;
Dreyfus International Equity Fund, Inc.++;
Dreyfus Land Development Corporation+;
The Dreyfus Leverage Fund, Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Massachusetts Intermediate
Municipal Bond Fund++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Income, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
Dreyfus New Jersey Intermediate Municipal
Bond Fund++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus New York Municipal Income, Inc.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.*;
Dreyfus Short-Term Income Fund, Inc.++;
Dreyfus Strategic Governments Income,
Inc.++;
Dreyfus Strategic Growth, L.P.++;
Dreyfus Strategic Income++;
Dreyfus Strategic Investing++;
Dreyfus Strategic Municipal Bond Fund,
Inc.++;
Dreyfus Strategic Municipals, Inc.++;
Dreyfus Strategic World Investing, L.P.++;
Dreyfus Variable Investment Fund++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
General California Municipal Bond Fund,
Inc.++;
Seven Six Seven Agency, Inc.*;
Director and Assistant Secretary:
The Dreyfus Fund International
Limited++++++
JEFFREY N. NACHMAN Vice President-Financial:
Vice President - Mutual Dreyfus A Bonds Plus, Inc.++;
Fund Accounting Dreyfus Appreciation Fund, Inc.++;
Dreyfus California Municipal Income,
Inc.++;
JEFFREY N. NACHMAN Dreyfus California Tax Exempt Bond Fund,
(cont'd) Inc.++;
Dreyfus California Tax Exempt Money Market
Fund++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Cash Management++;
Dreyfus Cash Management Plus, Inc.++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
The Dreyfus Convertible Securities Fund,
Inc.++;
The Dreyfus Fund Incorporated++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus Institutional Money Market Fund++;
Dreyfus Insured Municipal Bond Fund,
Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus Investors GNMA Fund, L.P.++;
The Dreyfus Leverage Fund, Inc.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus Municipal Income, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Insured Tax Exempt Bond
Fund++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus New York Municipal Income, Inc.++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
Dreyfus New York Tax Exempt Money Market
Fund++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
JEFFREY N. NACHMAN Dreyfus 100% U.S. Treasury Intermediate
(cont'd) Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Short-Intermediate Municipal Bond
Fund++;
Dreyfus Strategic Governments Income,
Inc.++;
Dreyfus Strategic Growth, L.P.++;
Dreyfus Strategic Income++;
Dreyfus Strategic Investing++;
Dreyfus Strategic Municipal Bond Fund,
Inc.++;
Dreyfus Strategic Municipals, Inc.++;
Dreyfus Strategic World Investing, L.P.++;
Dreyfus Tax Exempt Cash Management++;
The Dreyfus Third Century Fund, Inc.++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
Dreyfus Variable Investment Fund++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
First Prairie Tax Exempt Money Market
Fund++;
FN Network Tax Free Money Market Fund,
Inc.++;
General California Municipal Bond Fund
Inc.++;
General California Municipal Money Market
Fund++;
General Government Securities Money Market
Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
General New York Municipal Bond Fund,
Inc.++;
General New York Municipal Money Market
Fund++;
McDonald Money Market Fund, Inc.++;
McDonald Tax Exempt Money Market Fund,
Inc.++;
JEFFREY N. NACHMAN McDonald U.S. Government Money Market
(cont'd) Fund, Inc.++;
Peoples Index Fund, Inc.++;
Premier California Municipal Bond Fund++;
Premier GNMA Fund++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Premier State Municipal Bond Fund++;
Vice President and Treasurer:
Dreyfus Asset Allocation Fund, Inc.++;
Dreyfus Balanced Fund, Inc.++;
Dreyfus BASIC Money Market Fund, Inc.++;
Dreyfus BASIC Municipal Money Market Fund,
Inc.++;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Dreyfus California Intermediate Municipal
Bond Fund++;
Dreyfus Connecticut Intermediate Municipal
Bond Fund++;
Dreyfus Edison Electric Index Fund,
Inc.++;
Dreyfus Florida Intermediate Municipal
Bond Fund++;
Dreyfus Global Investing, Inc.++;
Dreyfus Growth Allocation Fund,
Inc.++;
Dreyfus Growth and Income Fund, Inc.++;
Dreyfus Institutional Short Term
Treasury Fund++;
Dreyfus Massachusetts Intermediate
Municipal Bond Fund++;
Dreyfus New Jersey Intermediate Municipal
Bond Fund++;
Dreyfus Short-Term Income Fund, Inc.++;
Dreyfus-Wilshire Target Funds, Inc.++;
First Prairie Cash Management++;
First Prairie U.S. Government Income
Fund++;
First Prairie U.S. Treasury Securities
Cash Management++;
Peoples S&P MidCap Index Fund, Inc.++;
Premier Growth Fund, Inc.++;
Premier California Insured Municipal
Bond Fund++;
Assistant Treasurer:
Pacific American Fund+++++
PETER A. SANTORIELLO Director, President and Investment
Vice President Officer:
Dreyfus Balanced Fund, Inc.++;
Director and President:
Dreyfus Management, Inc.**;
Vice President:
Dreyfus Personal Management, Inc.*
ROBERT H. SCHMIDT President and Director:
Vice President Dreyfus Service Corporation*;
Seven Six Seven Agency, Inc.*;
Formerly, Chairman and Chief Executive
Officer:
Levine, Huntley, Schmidt & Beaver
250 Park Avenue
New York, New York 10017
KIRK V. STUMPP Senior Vice President and
Vice President - Director of Marketing:
New Product Development Dreyfus Service Corporation*
PHILIP L. TOIA Chairman of the Board and Vice President:
Vice President and Dreyfus Thrift & Commerce****;
Director of Fixed- The Dreyfus Consumer Bank;
Income Research Senior Loan Officer and Director:
The Dreyfus Trust Company++;
Vice President:
The Dreyfus Consumer Credit Corporation*;
Formerly, Senior Vice President:
The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
One Chase Manhattan Plaza
New York, New York 10081
KATHERINE C. WICKHAM Vice President:
Assistant Vice President - Dreyfus Consumer Life Insurance
Human Resources Company++;
Formerly, Assistant Commissioner:
Department of Parks and Recreation of the
City of New York
830 Fifth Avenue
New York, New York 10022
JOHN J. PYBURN Vice President and Treasurer:
Assistant Vice President McDonald Money Market Fund, Inc.++;
McDonald Tax Exempt Money Market Fund,
Inc.++;
McDonald U.S. Government Money Market
Fund, Inc.++;
Treasurer and Assistant Secretary:
The Dreyfus Fund International
Limited++++++;
Treasurer:
Dreyfus A Bonds Plus, Inc.++;
Dreyfus Appreciation Fund, Inc.++;
Dreyfus California Municipal Income,
Inc.++;
Dreyfus California Tax Exempt Bond Fund,
Inc.++;
Dreyfus California Tax Exempt Money Market
Fund++;
Dreyfus Capital Value Fund, Inc.++;
JOHN J. PYBURN Dreyfus Cash Management++;
(cont'd) Dreyfus Cash Management Plus, Inc.++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
The Dreyfus Convertible Securities Fund,
Inc.++;
The Dreyfus Fund Incorporated++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus Institutional Money Market Fund++;
Dreyfus Insured Municipal Bond Fund,
Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus Investors GNMA Fund, L.P.++;
The Dreyfus Leverage Fund, Inc.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus Municipal Income, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Insured Tax Exempt Bond
Fund++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus New York Municipal Income, Inc.++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
Dreyfus New York Tax Exempt Money Market
Fund++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
JOHN J. PYBURN Dreyfus 100% U.S. Treasury Money Market
(cont'd) Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Short-Intermediate Municipal Bond
Fund++;
Dreyfus Strategic Governments Income,
Inc.++;
Dreyfus Strategic Growth, L.P.++;
Dreyfus Strategic Income++;
Dreyfus Strategic Investing++;
Dreyfus Strategic Municipal Bond Fund,
Inc.++;
Dreyfus Strategic Municipals, Inc.++;
Dreyfus Strategic World Investing, L.P.++;
Dreyfus Tax Exempt Cash Management++;
The Dreyfus Third Century Fund, Inc.++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
Dreyfus Variable Investment Fund++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
First Prairie Tax Exempt Money Market
Fund++;
FN Network Tax Free Money Market Fund,
Inc.++;
General California Municipal Bond Fund,
Inc.++;
General California Municipal Money Market
Fund++;
General Government Securities Money Market
Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
General New York Municipal Bond Fund,
Inc.++;
General New York Municipal Money Market
Fund++;
Peoples Index Fund, Inc.++;
Premier California Municipal Bond Fund++;
Premier GNMA Fund++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Premier State Municipal Bond Fund++
MAURICE BENDRIHEM Formerly, Vice President-Financial Planning,
Controller Administration and Tax:
Showtime/The Movie Channel, Inc.
1633 Broadway
New York, New York 10019;
Treasurer:
Dreyfus Acquisition Corporation*;
Dreyfus Consumer Life Insurance Company*;
Dreyfus Land Development Corporation*;
Dreyfus Life Insurance Company*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Partnership Management, Inc.*;
Dreyfus Service Organization, Inc.*;
Seven Six Seven Agency, Inc.*;
The Truepenny Corporation*;
Controller:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
The Dreyfus Consumer Credit Corporation*;
Assistant Treasurer:
Dreyfus Precious Metals*
MARK N. JACOBS Vice President:
Secretary and Deputy Dreyfus A Bonds Plus, Inc.++;
General Counsel Dreyfus Asset Allocation Fund, Inc.++;
Dreyfus Balanced Fund, Inc.++;
Dreyfus BASIC Money Market Fund, Inc.++;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Dreyfus California Intermediate Municipal
Bond Fund++;
Dreyfus Connecticut Intermediate Municipal
Bond Fund++;
The Dreyfus Convertible Securities Fund,
Inc. ++;
Dreyfus Edison Electric Index Fund,
Inc.++;
The Dreyfus Fund Incorporated++;
Dreyfus Global Investing, Inc.++;
Dreyfus Growth Allocation Fund,
Inc.++;
Dreyfus Institutional Money Market Fund++;
Dreyfus International Equity Fund, Inc.++;
The Dreyfus Leverage Fund, Inc.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Massachusetts Intermediate
Municipal Bond Fund++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
MARK N. JACOBS Dreyfus New Jersey Intermediate Municipal
(cont'd) Bond Fund++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Short-Term Income Fund, Inc.++;
Dreyfus Strategic Growth, L.P.++;
Dreyfus Strategic Income++;
Dreyfus Strategic Investing++;
Dreyfus Strategic Municipal Bond Fund,
Inc.++;
Dreyfus Strategic Municipals, Inc.++;
Dreyfus Strategic World Investing, L.P.++;
Dreyfus Variable Investment Fund++;
Dreyfus-Wilshire Target Funds, Inc.++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
General California Municipal Bond Fund,
Inc.++;
Peoples Index Fund, Inc.++;
Peoples S&P MidCap Index Fund, Inc.++;
Director:
World Balanced Fund++++;
Director and Secretary:
Dreyfus Life Insurance Company*;
Secretary:
Dreyfus Appreciation Fund, Inc.++;
Dreyfus BASIC Municipal Money Market Fund,
Inc.++;
Dreyfus California Tax Exempt Bond Fund,
Inc.++;
Dreyfus California Tax Exempt Money Market
Fund++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Cash Management++;
Dreyfus Cash Management Plus, Inc.++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
The Dreyfus Consumer Credit Corporation*;
Dreyfus Consumer Life Insurance Company*;
Dreyfus Florida Intermediate Municipal
Bond Fund++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Growth and Income Fund, Inc.++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus Institutional Short Term
Treasury Fund++;
MARK N. JACOBS Dreyfus Insured Municipal Bond Fund,
(cont'd) Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus Investors GNMA Fund, L.P.++;
Dreyfus Management, Inc.**;
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Insured Tax Exempt Bond
Fund++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
Dreyfus New York Tax Exempt Money Market
Fund++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Dreyfus Personal Management, Inc.**;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Short-Intermediate Municipal Bond
Fund++;
Dreyfus Tax Exempt Cash Management++;
The Dreyfus Third Century Fund, Inc.++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
First Prairie Cash Management++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
First Prairie Tax Exempt Money Market
Fund++;
First Prairie U.S. Government Income
Fund++;
First Prairie U.S. Treasury Securities
Cash Management++;
FN Network Tax Free Money Market Fund,
Inc.++;
General California Municipal Money Market
Fund++;
MARK N. JACOBS General Government Securities Money Market
(cont'd) Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
General New York Municipal Bond Fund,
Inc.++;
General New York Municipal Money Market
Fund++;
Pacific American Fund+++++;
Premier California Insured Municipal
Bond Fund++;
Premier California Municipal Bond Fund++;
Premier GNMA Fund++;
Premier Growth Fund, Inc.++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Premier State Municipal Bond Fund++;
Assistant Secretary:
Dreyfus Service Organization, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation*
CHRISTINE PAVALOS Assistant Secretary:
Assistant Secretary Dreyfus A Bonds Plus, Inc.++;
Dreyfus Acquisition Corporation*;
Dreyfus Appreciation Fund, Inc.++;
Dreyfus Asset Allocation Fund, Inc.++;
Dreyfus Balanced Fund, Inc.++;
Dreyfus BASIC Money Market Fund, Inc.++;
Dreyfus BASIC Municipal Money Market Fund,
Inc.++;
Dreyfus BASIC U.S. Government Money Market
Fund++;
Dreyfus California Intermediate Municipal
Bond Fund++;
Dreyfus California Municipal Income,
Inc.++;
Dreyfus California Tax Exempt Bond Fund,
Inc.++;
Dreyfus California Tax Exempt Money Market
Fund++;
Dreyfus Capital Value Fund, Inc.++;
Dreyfus Cash Management++;
Dreyfus Cash Management Plus, Inc.++;
Dreyfus Connecticut Intermediate
Municipal Bond Fund++;
Dreyfus Connecticut Municipal Money Market
Fund, Inc.++;
The Dreyfus Convertible Securities Fund,
Inc.++;
Dreyfus Edison Electric Index Fund,
Inc.++;
CHRISTINE PAVALOS Dreyfus Florida Intermediate Municipal
(cont'd) Bond Fund++;
The Dreyfus Fund Incorporated++;
Dreyfus Global Investing, Inc.++;
Dreyfus GNMA Fund, Inc.++;
Dreyfus Government Cash Management++;
Dreyfus Growth Allocation Fund,
Inc.++;
Dreyfus Growth and Income, Inc.++;
Dreyfus Growth Opportunity Fund, Inc.++;
Dreyfus Institutional Money Market Fund++;
Dreyfus Institutional Short Term
Treasury Fund++;
Dreyfus Insured Municipal Bond Fund,
Inc.++;
Dreyfus Intermediate Municipal Bond Fund,
Inc.++;
Dreyfus International Equity Fund, Inc.++;
Dreyfus Investors GNMA Fund, L.P.++;
Dreyfus Land Development Corporation*;
The Dreyfus Leverage Fund, Inc.++;
Dreyfus Life and Annuity Index Fund,
Inc.++;
Dreyfus Liquid Assets, Inc.++;
Dreyfus Management, Inc.**;
Dreyfus Massachusetts Intermediate
Municipal Bond Fund++;
Dreyfus Massachusetts Municipal Money
Market Fund++;
Dreyfus Massachusetts Tax Exempt Bond
Fund++;
Dreyfus Michigan Municipal Money Market
Fund, Inc.++;
Dreyfus Money Market Instruments, Inc.++;
Dreyfus Municipal Bond Fund, Inc.++;
Dreyfus Municipal Cash Management Plus++;
Dreyfus Municipal Income, Inc.++;
Dreyfus Municipal Money Market Fund,
Inc.++;
Dreyfus New Jersey Intermediate Municipal
Bond Fund++;
Dreyfus New Jersey Municipal Bond Fund,
Inc.++;
Dreyfus New Jersey Municipal Money Market
Fund, Inc.++;
Dreyfus New Leaders Fund, Inc.++;
Dreyfus New York Insured Tax Exempt Bond
Fund++;
Dreyfus New York Municipal Cash
Management++;
Dreyfus New York Municipal Income, Inc.++;
Dreyfus New York Tax Exempt Bond Fund,
Inc.++;
Dreyfus New York Tax Exempt Intermediate
Bond Fund++;
CHRISTINE PAVALOS Dreyfus New York Tax Exempt Money Market
(cont'd) Fund++;
Dreyfus Ohio Municipal Money Market Fund,
Inc.++;
Dreyfus 100% U.S. Treasury Intermediate
Term Fund, L.P.++;
Dreyfus 100% U.S. Treasury Long Term Fund,
L.P.++;
Dreyfus 100% U.S. Treasury Money Market
Fund, L.P.++;
Dreyfus 100% U.S. Treasury Short Term
Fund, L.P.++;
Dreyfus Pennsylvania Municipal Money
Market Fund++;
Dreyfus Service Corporation*;
Dreyfus Short-Intermediate Government
Fund++;
Dreyfus Short-Intermediate Municipal Bond
Fund++;
Dreyfus Short-Term Income Fund, Inc.++;
Dreyfus Strategic Governments Income,
Inc.++;
Dreyfus Strategic Growth, L.P.++;
Dreyfus Strategic Income++;
Dreyfus Strategic Investing++;
Dreyfus Strategic Municipal Bond Fund,
Inc.++;
Dreyfus Strategic Municipals, Inc.++;
Dreyfus Strategic World Investing, L.P.++;
Dreyfus Tax Exempt Cash Management++;
The Dreyfus Third Century Fund, Inc.++;
Dreyfus Treasury Cash Management++;
Dreyfus Treasury Prime Cash Management++;
Dreyfus Variable Investment Fund++;
Dreyfus-Wilshire Target Funds, Inc.++;
Dreyfus Worldwide Dollar Money Market
Fund, Inc.++;
First Prairie Cash Management++;
First Prairie Diversified Asset Fund++;
First Prairie Money Market Fund++;
First Prairie Tax Exempt Bond Fund,
Inc.++;
First Prairie Tax Exempt Money Market
Fund++;
First Prairie U.S. Government Income
Fund++;
First Prairie U.S. Treasury Securities
Cash Management++;
FN Network Tax Free Money Market Fund,
Inc.++;
General California Municipal Bond Fund,
Inc.++;
General California Municipal Money Market
Fund++;
CHRISTINE PAVALOS General Government Securities Money Market
(cont'd) Fund, Inc.++;
General Money Market Fund, Inc.++;
General Municipal Bond Fund, Inc.++;
General Municipal Money Market Fund,
Inc.++;
General New York Municipal Bond Fund,
Inc.++;
General New York Municipal Money Market
Fund++;
McDonald Money Market Fund, Inc.++;
McDonald Tax Exempt Money Market Fund,
Inc.++;
McDonald U.S. Government Money Market
Fund, Inc.++;
Peoples Index Fund, Inc.++;
Peoples S&P MidCap Index Fund, Inc.++;
Premier California Insured Municipal
Bond Fund++;
Premier California Municipal Bond Fund++;
Premier GNMA Fund++;
Premier Growth Fund, Inc.++;
Premier Municipal Bond Fund++;
Premier New York Municipal Bond Fund++;
Premier State Municipal Bond Fund++;
The Truepenny Corporation*
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 767 Fifth Avenue, New
York, New York 10153.
*** The address of the business so indicated is 45 Broadway, New York,
New York 10006.
**** The address of the business so indicated is Five Triad Center, Salt
Lake City, Utah 84180.
+ The address of the business so indicated is Atrium Building, 80 Route
4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
+++ The address of the business so indicated is One Rockefeller Plaza,
New York, New York 10020.
++++ The address of the business so indicated is 2 Boulevard Royal,
Luxembourg.
+++++ The address of the business so indicated is 800 West Sixth Street,
Suite 1000, Los Angeles, California 90017.
++++++ The address of the business so indicated is Nassau, Bahama Islands.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Strategy Fund, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC Money Market Fund, Inc.
7) Dreyfus BASIC Municipal Money Market Fund, Inc.
8) Dreyfus BASIC U.S. Government Money Market Fund
9) Dreyfus California Intermediate Municipal Bond Fund
10) Dreyfus California Tax Exempt Bond Fund, Inc.
11) Dreyfus California Tax Exempt Money Market Fund
12) Dreyfus Capital Value Fund, Inc.
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) The Dreyfus Convertible Securities Fund, Inc.
18) Dreyfus Edison Electric Index Fund, Inc.
19) Dreyfus Florida Intermediate Municipal Bond Fund
20) The Dreyfus Fund Incorporated
21) Dreyfus Global Investing, Inc.
22) Dreyfus GNMA Fund, Inc.
23) Dreyfus Government Cash Management
24) Dreyfus Growth and Income Fund, Inc.
25) Dreyfus Growth Opportunity Fund, Inc.
26) Dreyfus Institutional Money Market Fund
27) Dreyfus Institutional Short Term Treasury Fund
28) Dreyfus Insured Municipal Bond Fund, Inc.
29) Dreyfus Intermediate Municipal Bond Fund, Inc.
30) Dreyfus International Equity Fund, Inc.
31) Dreyfus Investors GNMA Fund, L.P.
32) The Dreyfus Leverage Fund, Inc.
33) Dreyfus Life and Annuity Index Fund, Inc.
34) Dreyfus Liquid Assets, Inc.
35) Dreyfus Massachusetts Intermediate Municipal Bond Fund
36) Dreyfus Massachusetts Municipal Money Market Fund
37) Dreyfus Massachusetts Tax Exempt Bond Fund
38) Dreyfus Michigan Municipal Money Market Fund, Inc.
39) Dreyfus Money Market Instruments, Inc.
40) Dreyfus Municipal Bond Fund, Inc.
41) Dreyfus Municipal Cash Management Plus
42) Dreyfus Municipal Money Market Fund, Inc.
43) Dreyfus New Jersey Intermediate Municipal Bond Fund
44) Dreyfus New Jersey Municipal Bond Fund, Inc.
45) Dreyfus New Jersey Municipal Money Market Fund, Inc.
46) Dreyfus New Leaders Fund, Inc.
47) Dreyfus New York Insured Tax Exempt Bond Fund
48) Dreyfus New York Municipal Cash Management
49) Dreyfus New York Tax Exempt Bond Fund, Inc.
50) Dreyfus New York Tax Exempt Intermediate Bond Fund
51) Dreyfus New York Tax Exempt Money Market Fund
52) Dreyfus Ohio Municipal Money Market Fund, Inc.
53) Dreyfus 100% U.S. Treasury Intermediate Term Fund, L.P.
54) Dreyfus 100% U.S. Treasury Long Term Fund, L.P.
55) Dreyfus 100% U.S. Treasury Money Market Fund, L.P.
56) Dreyfus 100% U.S. Treasury Short Term Fund, L.P.
57) Dreyfus Pennsylvania Municipal Money Market Fund
58) Dreyfus Short-Intermediate Government Fund
59) Dreyfus Short-Intermediate Municipal Bond Fund
60) Dreyfus Short-Term Income Fund, Inc.
61) Dreyfus Strategic Growth, L.P.
62) Dreyfus Strategic Income
63) Dreyfus Strategic World Investing, L.P.
64) Dreyfus Tax Exempt Cash Management
65) The Dreyfus Third Century Fund, Inc.
66) Dreyfus Treasury Cash Management
67) Dreyfus Treasury Prime Cash Management
68) Dreyfus Variable Investment Fund
69) Dreyfus-Wilshire Target Funds, Inc.
70) Dreyfus Worldwide Dollar Money Market Fund, Inc.
71) First Prairie Cash Management
72) First Prairie Diversified Asset Fund
73) First Prairie Money Market Fund
74) First Prairie Tax Exempt Bond Fund, Inc.
75) First Prairie Tax Exempt Money Market Fund
76) First Prairie U.S. Treasury Securities Cash Management
77) FN Network Tax Free Money Market Fund, Inc.
78) General California Municipal Bond Fund, Inc.
79) General California Municipal Money Market Fund
80) General Government Securities Money Market Fund, Inc.
81) General Money Market Fund, Inc.
82) General Municipal Bond Fund, Inc.
83) General Municipal Money Market Fund, Inc.
84) General New York Municipal Bond Fund, Inc.
85) General New York Municipal Money Market Fund
86) Pacific American Fund
87) Peoples Index Fund, Inc.
88) Peoples S&P MidCap Index Fund, Inc.
89) Premier California Insured Municipal Bond Fund
90) Premier California Municipal Bond Fund
91) Premier GNMA Fund
92) Premier Growth Fund, Inc.
93) Premier Municipal Bond Fund
94) Premier New York Municipal Bond Fund
95) Premier State Municipal Bond Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address Dreyfus Service Corporation Registrant
__________________ ___________________________ _____________
Howard Stein* Chairman of the Board Trustee and
Investment
Officer
Robert H. Schmidt* President and Director None
Joseph S. DiMartino* Executive Vice President and Director None
Lawrence M. Greene* Executive Vice President and Director None
Julian M. Smerling* Executive Vice President and Director None
Elie M. Genadry* Executive Vice President None
Hank Gottmann* Executive Vice President None
Donald A. Nanfeldt* Executive Vice President None
Kevin Flood* Senior Vice President None
Roy Gross* Senior Vice President None
Irene Papadoulis** Senior Vice President None
Kirk Stumpp* Senior Vice President None
and Director of Marketing
Diane M. Coffey* Vice President None
Walter T. Harris* Vice President None
William Harvey* Vice President None
Adwick Pinnock** Vice President None
George Pirrone* Vice President/Trading None
Karen Rubin Waldmann* Vice President None
Peter D. Schwab* Vice President/New Products None
Michael Anderson* Assistant Vice President None
Carolyn Sobering* Assistant Vice President-Trading None
Daniel C. Maclean* Secretary Secretary
Robert F. Dubuss* Treasurer None
Maurice Bendrihem* Controller None
Michael J. Dolitsky* Assistant Controller None
Susan Verbil Goldgraben* Assistant Treasurer None
Christine Pavalos* Assistant Secretary Assistant
Secretary
Broker-Dealer Division of Dreyfus Service Corporation
=====================================================
Positions and offices with Positions and
Name and principal Broker-Dealer Division of offices with
business address Dreyfus Service Corporation Registrant
__________________ ___________________________ _____________
Elie M. Genadry* President None
Craig E. Smith* Executive Vice President None
Peter Moeller* Vice President and Sales Manager None
Kristina Williams
Pomano Beach, FL Vice President-Administration None
Edward Donley
Latham, NY Regional Vice President None
Glenn Farinacci* Regional Vice President None
Peter S. Ferrentino
San Francisco, CA Regional Vice President None
William Frey
Hoffman Estates, IL Regional Vice President None
Suzanne Haley
Tampa, FL Regional Vice President None
Philip Jochem
Warrington, PA Regional Vice President None
Fred Lanier
Atlanta, GA Regional Vice President None
Beth Presson
Colchester, VT Regional Vice President None
Joseph Reaves
New Orleans, LA Regional Vice President None
Christian Renninger
Germantown, MD Regional Vice President None
Kurt Wiessner
Minneapolis, MN Regional Vice President None
Mary Rogers** Assistant Vice President None
Institutional Services Division of Dreyfus Service Corporation
==============================================================
Positions and offices with Positions and
Name and principal Institutional Services Division offices with
business address of Dreyfus Service Corporation Registrant
__________________ _______________________________ _____________
Elie M. Genadry* President None
Donald A. Nanfeldt* Executive Vice President None
Charles Cardona** Senior Vice President None
Stacy Alexander* Vice President None
Eric Almquist* Vice President None
James E. Baskin+++++++ Vice President None
Kenneth Bernstein
Boca Raton, FL Vice President-Institutional Sales None
Stephen Burke* Vice President None
Laurel A. Diedrick
Burrows*** Vice President None
Daniel L. Clawson++++ Vice President None
Michael Caraboolad
Gates Mills, OH Vice President-Institutional Sales None
Laura Caudillo++ Vice President-Institutional Sales None
Steven Faticone***** Vice-President-Institutional Sales None
William E. Findley**** Vice President None
Mary Genet***** Vice President None
Melinda Miller Gordon* Vice President None
Christina Haydt++ Vice President-Institutional Sales None
Carol Anne Kelty* Vice President-Institutional Sales None
Gwenn Kessler***** Vice President-Institutional Sales None
Nancy Knee++++ Vice President-Institutional Sales None
Bradford Lange* Vice President-Institutional Sales None
Kathleen McIntyre
Lewis++ Vice President None
Eva Machek***** Vice President-Institutional Sales None
Mary McCabe*** Vice President-Institutional Sales None
James McNamara***** Vice President-Institutional Sales None
James Neiland* Vice President None
Susan M. O'Connor* Vice President-Institutional
Seminars None
Andrew Pearson+++ Vice President-Institutional Sales None
Jean Heitzman Penny***** Vice President-Institutional Sales None
Dwight Pierce+ Vice President None
Lorianne Pinto* Vice President-Institutional Sales None
Douglas Rentschler
Grosse Point Park, MI Vice President-Institutional Sales None
Leah Ryan**** Vice President-Institutional Sales None
Emil Samman* Vice President-Institutional
Marketing None
Edward Sands* Vice President-Institutional
Administration None
William Schalda* Vice President None
Sue Ann Seefeld++++ Vice President-Institutional Sales None
Elizabeth Biordi Vice President-Institutional
Wieland* Administration None
Jeanne Butler* Assistant Vice President-
Institutional Operations None
Roberta Hall***** Assistant Vice President-
Institutional Servicing None
Tracy Hopkins** Assistant Vice President-
Institutional Operations None
Lois Paterson* Assistant Vice President-
Institutional Operations None
Karen Markovic
Shpall++++++ Assistant Vice President None
Patrick Synan** Assistant Vice President-
Institutional Support None
Emilie Tongalson** Assistant Vice President-
Institutional Servicing None
Carolyn Warren++ Assistant Vice President-
Institutional Servicing None
Tonda Watson**** Assistant Vice President-
Institutional Sales None
Group Retirement Plans Division of Dreyfus Service Corporation
==============================================================
Positions and offices with Positions and
Name and principal Group Retirement Plans Division offices with
business address of Dreyfus Service Corporation Registrant
__________________ _______________________________ _____________
Elie M. Genadry* President None
Robert W. Stone* Executive Vice President None
Paul Allen* Executive Vice President-
National Sales None
Leonard Larrabee* Vice President and Senior Counsel None
George Anastasakos* Vice President None
Bart Ballinger++ Vice President-Sales None
Paula Cleary* Vice President-Marketing None
Ellen S. Dinas* Vice President-Marketing/Communications None
Wendy Holcomb++ Vice President-Sales None
William Gallagher* Vice President-Sales None
Brent Glading* Vice President-Sales None
Gerald Goz* Vice President-Sales None
Jeffrey Lejune
Dallas, TX Vice President-Sales None
Samuel Mancino** Vice President-Installation None
Joanna Morris* Vice President-Sales None
Joseph Pickert++ Vice President-Sales None
Alison Saunders** Vice President-Enrollment None
Scott Zeleznik* Vice President-Sales None
Alana Zion* Vice President-Sales None
Jeffrey Blake* Assistant Vice President-Sales None
_____________________________________________________
* The address of the offices so indicated is 200 Park Avenue, New
York, New York 10166
** The address of the offices so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
*** The address of the offices so indicated is 580 California Street,
San Francisco, California 94104.
**** The address of the offices so indicated is 3384 Peachtree Road,
Suite 100, Atlanta, Georgia 30326-1106.
***** The address of the offices so indicated is 190 South LaSalle
Street, Suite 2850, Chicago, Illinois 60603.
+ The address of the offices so indicated is P.O. Box 1657, Duxbury,
Massachusetts 02331.
++ The address of the offices so indicated is 800 West Sixth Street,
Suite 1000, Los Angeles, California 90017.
+++ The address of the offices so indicated is 11 Berwick Lane,
Edgewood, Rhode Island 02905.
++++ The address of the offices so indicated is 1700 Lincoln Street,
Suite 3940, Denver, Colorado 80203.
+++++ The address of the offices so indicated is 6767 Forest Hill
Avenue, Richmond, Virginia 23225.
++++++ The address of the offices so indicated is 2117 Diamond Street,
San Diego, California 92109.
+++++++ The address of the offices so indicated is P.O. Box 757,
Holliston, Massachusetts 01746.
Item 30. Location of Accounts and Records
________________________________
1. The Shareholder Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
110 Washington Street
New York, New York 10286
3. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a trustee or trustees when requested
in writing to do so by the holders of at least 10% of the
Registrant's outstanding shares of beneficial interest and in
connection with such meeting to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 relating to
shareholder communications.
(2) To furnish each person to whom a prospectus is delivered with a
copy of its latest annual report to shareholders, upon request
and without charge.
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 effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and
has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of New
York, and State of New York on the 20th day of January, 1994.
DREYFUS STRATEGIC INVESTING
BY: /s/Richard C. Shields*
RICHARD C. SHIELDS, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, this Amendment to the Registration Statement
has been signed below by the following persons in the capacities and on the
date indicated.
Signatures Title Date
___________________________ ________________ ___________
/s/Richard C. Shields* President 1/20/94
- --------------------
Richard C. Shields
/s/John J. Pyburn* Treasurer (Principal Financial and 1/20/94
- ----------------- Accounting Officer)
John J. Pyburn
/s/Diane Dunst* Trustee 1/20/94
- --------------
Diane Dunst
/s/David P. Feldman* Trustee 1/20/94
- -------------------
David P. Feldman
/s/Howard Stein* Trustee 1/20/94
- ---------------
Howard Stein
/s/Jay I. Meltzer* Trustee 1/20/94
- -----------------
Jay Meltzer
/s/Daniel Rose* Trustee 1/20/94
- --------------
Daniel Rose
/s/Warren B. Rudman* Trustee 1/20/94
- -------------------
Warren B. Rudman
/s/Saunder Vanocur* Trustee 1/20/94
- ------------------
Saunder Vanocur
*BY: __________________________
Steven F. Newman,
Attorney-in-Fact
INDEX OF EXHIBITS
Page
(11) Consent of Ernst & Young,
Independent Auditors . . . . . . . . . . . . . . . .
(16) Schedules of Calculations
of Performance Data. . . . . . . . . . . . . . . . .
Other Exhibit
(a) Powers of Attorney . . . . . . . . . . . . . . . . .
(b) Certificate of Secretary . . . . . . . . . . . . . .
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Custodian, Transfer and Dividend Disbursing
Agent, Counsel and Independent Auditors" and to the use of our report dated
December 10, 1993, in this Registration Statement (Form N-1A 33-6013) of
Dreyfus Strategic Investing.
ERNST & YOUNG
New York, New York
January 14, 1994
DREYFUS STRATEGIC INVESTING - CLASS A
AVERAGE ANNUAL TOTAL RETURN COMPUTATION
Average annual total return computation from inception through 10/31/93
based upon the following formula:
n
P( 1 + T ) = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value as of 10/31/93 of a $1,000
hypothetical investment made on 10/16/86 (inception)
7.044
1000( 1 + T ) = 2,552.66
T = 14.23%
==========
DREYFUS STRATEGIC INVESTING - CLASS A
TOTAL RETURN COMPUTATION
Total return computation from inception through 10/31/93
based upon the following formula:
[ C + ( C x B ) ] - A
---------------------
T = A
where: A = NAV at beginning of period
B = Additional shares purchased through dividend reinvestment
C = NAV at end of period
T = Total return
T = [ 23.77 + ( 23.77 x 0.408952 ) ] - 12.53
--------------------------------------------
12.53
T = 167.28%
========
DREYFUS STRATEGIC INVESTING - CLASS A
AVERAGE ANNUAL TOTAL RETURN COMPUTATION
Average annual total return computation from 10/31/92 through 10/31/93
based upon the following formula:
n
P( 1 + T ) = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value as of 10/31/93 of a $1,000
hypothetical investment made on 10/31/92
1.00
1000( 1 + T ) = 1,143.10
T = 14.31%
============
DREYFUS STRATEGIC INVESTING - CLASS A
AVERAGE ANNUAL TOTAL RETURN COMPUTATION
Average annual total return computation from 10/31/88 through 10/31/93
based upon the following formula:
n
P( 1 + T ) = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value as of 10/31/93 of a $1,000
hypothetical investment made on 10/31/88
5.00
1000( 1 + T ) = 1,959.24
T = 14.40%
============
DREYFUS STRATEGIC INVESTING - CLASS A
TOTAL RETURN COMPUTATION
Total return computation from inception through 10/31/93
based upon the following formula:
[ C + ( C x B ) ] - A
---------------------
T = A
where: A = Maximum Offering Price at beginning of period
B = Additional shares purchased through dividend reinvestment
C = NAV at end of period
T = Total return
T = [ 23.77 + ( 23.77 x 0.408952 ) ] - 13.12
--------------------------------------------
13.12
T = 155.27%
========
DREYFUS STRATEGIC INVESTING - CLASS B
AVERAGE ANNUAL TOTAL RETURN COMPUTATION
Average annual total return computation from inception through 10/31/93
based upon the following formula:
n
P( 1 + T ) = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value as of 10/31/93 of a $1,000
hypothetical investment made on 1/15/93 (inception)
0.795
1000( 1 + T ) = 1,064.78
T = 8.22%
==========
DREYFUS STRATEGIC INVESTING - CLASS B
TOTAL RETURN COMPUTATION
Total return computation from inception through 10/31/93
based upon the following formula:
[ C + ( C x B ) ] - A
---------------------
T = A
where: A = NAV at beginning of period
B = Additional shares purchased through dividend reinvestment
C = NAV at end of period
T = Total return
T = [ 23.62 + ( 23.62 x 0.0000 ) ] - 21.38
--------------------------------------------
21.38
T = 10.48%
========
DREYFUS STRATEGIC INVESTING - CLASS B
TOTAL RETURN COMPUTATION
Total return computation from inception through 10/31/93
based upon the following formula:
[ C + ( C x B ) ] - A D x ( E x F )
--------------------- --- -------------
T = A G
where: A = NAV at beginning of period
B = Additional shares purchased through dividend reinvestment
C = NAV at end of period
D = Applicable CDSC
E = Lower of A or C
F = Original shares
G = Original investment
T = Total return
T = [ 23.62 + (23.62 x 0.0000 ) ] - 21.38 -- 0.04 x ( 21.38 x 46.773 )
----------------------------------------- ------------------------
21.38 1000
T = 6.48%
======
