November 15, 1997
DREYFUS REAL ESTATE
MORTGAGE FUND
SUPPLEMENT TO PROSPECTUS
DATED SEPTEMBER 30, 1997
THE FOLLOWING INFORMATION SUPPLEMENTS AND SHOULD BE READ IN
CONJUNCTION WITH THE SECTION OF THE FUND'S PROSPECTUS ENTITLED "DESCRIPTION
OF THE FUND_MANAGEMENT POLICIES":
The Fund also may invest in equity securities, such as common stocks
and securities convertible into common stocks, issued by companies that
primarily invest or deal in real estate.
THE FOLLOWING INFORMATION SUPPLEMENTS AND SUPERCEDES ANY CONTRARY
INFORMATION CONTAINED IN THE SECTION OF THE FUND'S PROSPECTUS ENTITLED
"DESCRIPTION OF THE FUND_MANAGEMENT POLICIES":
The average dollar-weighted credit rating of the debt securities
(including preferred stock) held by the Fund, however, as measured on the
basis of the dollar value of the securities purchased and their credit rating
without reference to subcategories, will be at least Baa by Moody's or BBB by
S&P, Fitch, or Duff.
THE FOLLOWING INFORMATION SUPERCEDES THE INFORMATION CONTAINED IN
THE SECTION OF THE FUND'S PROSPECTUS ENTITLED "APPENDIX_ADDITIONAL
INFORMATION ABOUT PURCHASES, EXCHANGES AND REDEMPTIONS":
ADDITIONAL INFORMATION ABOUT PURCHASES, EXCHANGES AND REDEMPTIONS.
The Fund is intended to be a long-term investment vehicle and is not designed
to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases and exchanges can be disruptive to
efficient portfolio management and, consequently, can be detrimental to the
Fund's performance and its shareholders. Accordingly, if the Fund's
management determines that an investor is engaged in excessive trading, the
Fund, with or without prior notice, may temporarily or permanently terminate
the availability of Fund exchanges, or reject in whole or part any purchase
or exchange request, with respect to such investor's account. Such investors
also may be barred
(CONTINUED ON REVERSE SIDE)
from purchasing other funds in the Dreyfus Family of Funds. Generally, an
investor who makes more than four exchanges out of the Fund during any
calendar year or who makes exchanges that appear to coincide with an active
market-timing strategy may be deemed to be engaged in excessive trading.
Accounts under common ownership or control will be considered as one account
for purposes of determining a pattern of excessive trading. In addition, the
Fund may refuse or restrict purchase or exchange requests by any person or
group if, in the judgment of the Fund's management, the Fund would be unable
to invest the money effectively in accordance with its investment objective
and policies or could otherwise be adversely affected or if the Fund receives
or anticipates receiving simultaneous orders that may significantly affect
the Fund (E.G., amounts equal to 1% or more of the Fund's total assets). If
an exchange request is refused, the Fund will take no other action with
respect to the shares until it receives further instructions from the
investor. The Fund may delay forwarding redemption proceeds for up to seven
days if the investor redeeming shares is engaged in excessive trading or if
the amount of the redemption request otherwise would be disruptive to
efficient portfolio management or would adversely affect the Fund. The Fund's
policy on excessive trading applies to investors who invest in the Fund
directly or through financial intermediaries, but does not apply to the
Dreyfus Auto-Exchange Privilege, to any automatic investment or withdrawal
privilege described herein, or to participants in employer-sponsored
retirement plans.
THE FOLLOWING POLICY WILL BE EFFECTIVE ON JANUARY 15, 1998. During
times of drastic economic or market conditions, the Fund may suspend the
Exchange Privilege temporarily without notice and treat exchange requests
based on their separate components _ redemption orders with a simultaneous
request to purchase the other fund's shares. In such a case, the redemption
request would be processed at the Fund's next determined net asset value but
the purchase order would be effective only at the net asset value next
determined after the fund being purchased receives the proceeds of the
redemption, which may result in the purchase being delayed.
045s1197
