<PAGE>
Deutsche Asset Management
Mutual Fund
Prospectus
January 31, 2000
As Revised October 13, 2000
International Equity
formerly a BT Mutual Fund
[Like shares of all mutual funds,
these securities have not been
approved or disapproved by the
Securities and Exchange Commission nor
has the Securities and Exchange
Commission passed upon the accuracy or A Member of the
adequacy of this prospectus. Any Deutsche Bank Group [/]
representation to the contrary is a
criminal offense.]
<PAGE>
Overview
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of International Equity
Goal: The Fund invests for long-term capital appreciation.
Core Strategy: The Fund invests primarily in the stocks and other equity
securities of companies in developed countries outside the United States.
INVESTMENT POLICIES AND STRATEGIES
The Fund invests all of its assets in a master portfolio with the same
investment goal as the Fund. The Fund, through the master portfolio, seeks to
achieve that goal by investing primarily in companies in developed foreign
countries. The Fund may also invest a portion of its assets in companies based
in emerging markets. The companies are selected by an extensive tracking system
plus the input of experts from various financial disciplines.
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<PAGE>
International Equity
Overview of International Equity
Goal............................................................. 1
Core Strategy.................................................... 1
Investment Policies And Strategies............................... 1
Principal Risks Of Investing In The Fund......................... 3
Who Should Consider Investing In The Fund........................ 3
Total Returns, After Fees And Expenses........................... 4
Annual Fund Operating Expenses................................... 6
A Detailed Look at International Equity
Objective........................................................ 7
Strategy......................................................... 7
Principal Investments............................................ 7
Investment Process............................................... 8
Risks............................................................ 8
Management Of The Fund........................................... 11
Calculating The Fund's Share Price............................... 16
Performance Information.......................................... 16
Dividends And Distributions...................................... 16
Tax Considerations............................................... 16
Buying And Selling Fund Shares................................... 17
Financial Highlights............................................. 23
2
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Overview of International Equity
PRINCIPAL RISKS OF INVESTING IN THE FUND
An investment in the Fund could lose money, or the Fund's performance could
trail that of other investments. For example:
. Stocks that we have selected could perform poorly; or
. The stock market could perform poorly in one or more of the countries in
which the Fund has invested.
Beyond the risks common to all stock investing, an investment in the Fund
could also lose money or under perform alternative investments as a result of
risks in the foreign countries in which the Fund invests:
. Adverse political, economic or social developments could undermine the
value of the Fund's investments or prevent the Fund from realizing their
full value;
. Accounting and financial reporting standards differ from those in the U.S.
and could convey incomplete information when compared to information
typically provided by U.S. companies; or
. The currency of a country in which the Fund invests may decrease in value
relative to the U.S. dollar, which could affect the value of the investment
to U.S. investors.
WHO SHOULD CONSIDER INVESTING IN THE FUND
You should consider investing in the Fund if you are seeking long-term capital
appreciation. There is, of course, no guarantee that the Fund will realize its
goal. Moreover, you should be willing to accept greater short-term fluctuation
in the value of your investment than you would typically experience investing in
bond or money market funds.
You should not consider investing in the Fund if you are pursuing a short-term
financial goal, if you seek regular income or if you cannot tolerate
fluctuations in the value of your investments.
The Fund by itself does not constitute a balanced investment program. It can,
however, afford you exposure to investment opportunities not available to
someone who invests in U.S. securities alone. Diversifying your investments may
improve your long-run investment return and lower the volatility of your overall
investment portfolio.
An investment in International Equity is not a bank deposit and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
3
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Overview of International Equity
TOTAL RETURNS, AFTER FEES AND EXPENSES
The bar chart and table on this page can help you evaluate the potential risks
and rewards of investing in the Fund by showing changes in the Fund's
performance year to year. The bar chart shows the Fund's actual return for each
full calendar year since the Fund began selling shares on August 4, 1992 (its
inception date). The table compares the Fund's average annual return with the
Morgan Stanley Capital International (MSCI) EAFE Index over the last one and
five years, and since its inception. The Index is a passive measure of combined
national stock market returns. It does not factor in the costs of buying,
selling and holding stock--costs that are reflected in the Fund's results.
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The MSCI EAFE Index of major markets in Europe, Australia and the Far East is a
widely accepted benchmark of international stock performance. It is a model, not
an actual portfolio. It tracks stocks in Australia, Austria, Belgium, Denmark,
Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, the Netherlands, New
Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the United
Kingdom.
4
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Year-by-Year Returns
(each full calendar year since inception)
---------------------------
1993 37.38%
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1994 4.11%
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1995 16.10%
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1996 21.32%
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1997 17.37%
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1998 20.82%
---------------------------
1999 32.22%
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Since inception, the Fund's highest return in any calendar quarter was 32.05%
(fourth quarter 1999) and its lowest quarterly return was -16.58% (third
quarter 1998). Past performance offers no indication of how the Fund will
perform in the future.
PERFORMANCE FOR PERIOD ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
Average Annual Returns/1/
1 Year 5 Years Since Inception
(August 4, 1992)/2/
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
International Equity Fund 32.22% 21.44% 19.25%
--------------------------------------------------------------------------------------------------------
MSCI EAFE Index 26.96% 12.83% 13.84%
--------------------------------------------------------------------------------------------------------
Lipper International Funds
Average 40.81% 15.05% 14.23%
--------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Unweighted average return, net of fees and expenses, of all mutual funds
that invested primarily in stocks and other equity securities of companies
outside the United States during the periods covered.
/2/ The MSCI EAFE Index and Lipper International Funds Average are calculated
from July 31, 1992.
5
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Overview of International Equity
ANNUAL FUND OPERATING EXPENSES
(expenses paid from Fund assets)
The Annual Fees and Expenses table to the right describes the fees and expenses
that you may pay if you buy and hold shares of International Equity.
Expense Example. The example below illustrates the expenses you would have
incurred on a $10,000 investment in the Fund. It assumes that the Fund earned an
annual return of 5% over the periods shown, the Fund's operating expenses
remained the same and you sold your shares at the end of the period.
You may use this hypothetical example to compare the Fund's expense history with
other funds./1/ Your actual costs may be higher or lower.
<TABLE>
<CAPTION>
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ANNUAL FEES AND EXPENSES
Percentage of Average
Daily Net Assets/1/
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<S> <C>
Management Fees 0.65%
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Distribution an Service (12b-1) Fees None
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Other Expenses 1.01%
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Total Fund Operating Expenses 1.66%
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Less: Fee Waivers or Expenses Reimbursements (0.16%)/2/
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Net Expenses 1.50%
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</TABLE>
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Expense Example/3/
1 year 3 years 5 years 10 years
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$153 $503 $882 $1,948
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_______________________________
/1/ Information on the annual operating expenses reflects the expenses of both
the Fund and the International Equity Portfolio, the master portfolio into which
International Equity invests all of its assets. (A further discussion of the
relationship between the Fund and the master portfolio appears in the
"Organizational Structure" section of this prospectus.)
/2/ The investment adviser and administrator have agreed, for the 16-month
period from the Fund's fiscal year end of October 31, 1999, to waive their fees
and reimburse expenses so that total expenses will not exceed 1.50%.
/3/ For the first 16 months, the expense example takes into account fee waivers
and reimbursements.
6
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A detailed look
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at International Equity
OBJECTIVE
The Fund seeks long-term capital appreciation. Under normal circumstances, the
Fund invests at least 65% of its total assets in the stocks and other securities
with equity characteristics of companies in developed countries outside the
United States.
The Fund invests for capital appreciation, not income; any dividend or interest
income is incidental to the pursuit of that goal. While we give priority to
capital appreciation, we cannot offer any assurance of achieving this goal. The
Fund's goal is not a fundamental policy. We must notify shareholders before we
change it, but we do not require their approval to do so.
STRATEGY
The Fund invests for the long term. We employ a strategy of growth at a
reasonable price. We seek to identify companies outside the United States that
combine strong potential for earnings growth with reasonable investment value.
Such companies typically exhibit increasing rates of profitability and cash
flow, yet their share prices compare favorably to other stocks in a given market
and to their global peers. In evaluating stocks, we consider factors such as
sales, earnings, cash flow and enterprise value. Enterprise value is a company's
market capitalization plus the value of its net debt. We further consider the
relationship between these and other quantitative factors. Together, these
indicators of growth and value may identify companies with improving prospects
before the market in general has taken notice.
PRINCIPAL INVESTMENTS
Almost all the companies in which the Fund invests are based in the developed
foreign countries that make up the MSCI EAFE Index, plus Canada. The Fund may
also invest a portion of its assets in companies based in the emerging markets
of Latin America, the Middle East, Europe, Asia and Africa if we believe that
their return potential more than compensates for the extra risks associated with
these markets. While we have invested in emerging markets in the past, under
normal market conditions we do not consider this a central element of the Fund's
strategy. Typically, we would not hold more than 15% of the Fund's net assets in
emerging markets.
7
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INVESTMENT PROCESS
Company research lies at the heart of our investment process, as it does with
many stock mutual funds. We track several thousand companies to arrive at the
approximately 100 stocks the Fund normally holds. But our process brings an
added dimension to this fundamental research. It draws on the insight of experts
from a range of financial disciplines--regional stock market specialists, global
industry specialists, economists and quantitative analysts. They challenge,
refine and amplify each other's ideas. Their close collaboration is a critical
element of our investment process.
Temporary Defensive Position. We may from time to time adopt a temporary
defensive position in response to extraordinary adverse political, economic or
stock market events. We may invest up to 100% of the Fund's assets in U.S. or
foreign government money market investments, or other short-term bonds that
offer comparable safety, if the situation warranted. To the extent we might
adopt such a position and over the course of its duration, the Fund may not meet
its goal of long-term capital appreciation.
RISKS
Below we set forth some of the prominent risks associated with international
investing, as well as investing in general. Although we attempt to assess the
likelihood that these risks may actually occur and to limit them, we make no
guarantee that we will succeed.
Primary Risks
Market Risk. Although individual stocks can outperform their local markets,
deteriorating market conditions might cause an overall weakness in the stock
prices of the entire market.
Stock Selection Risk. A risk that pervades all investing is the risk that the
securities an investor has selected will not perform to expectations. To
minimize this risk, we monitor each of the stocks in the Fund according to three
basic quantitative criteria. We subject a stock to intensive review if:
. its rate of price appreciation begins to trail that of its national stock
index;
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Portfolio Turnover. The portfolio turnover rate measures the frequency that the
master portfolio sells and replaces the securities it holds within a given
period. Historically, this Fund has had a low portfolio turnover rate.
8
<PAGE>
A Detailed Look at International Equity
. the financial analysts who follow the stock, both within Bankers Trust and
outside, cut their estimates of the stock's future earnings; or
. the stock's price approaches the downside target we set when we first
bought the stock (and may since have modified to reflect changes in market
and economic conditions).
In this review, we seek to learn if the deteriorating performance accurately
reflects deteriorating prospects or if, in our view, it merely reflects investor
overreaction to temporary circumstances.
Foreign Stock Market Risk. From time to time, foreign capital markets have
exhibited more volatility than those in the United States. Trading stocks on
some foreign exchanges is inherently more difficult than trading in the United
States for reasons including:
. Political Risk. Some foreign governments have limited the outflow of
profits to investors abroad, extended diplomatic disputes to include trade
and financial relations, and imposed high taxes on corporate profits. While
these political risks have not occurred recently in the major countries in
which the Fund invests, we analyze countries and regions to try to
anticipate these risks.
. Information Risk. Financial reporting standards for companies based in
foreign markets differ from those in the United States. Since the "numbers"
themselves sometimes mean different things, we devote much of our research
effort to understanding and assessing the impact of these differences upon
a company's financial conditions and prospects.
. Liquidity Risk. Stocks that trade less can be more difficult or more costly
to buy, or to sell, than more liquid or active stocks. This liquidity risk
is a factor of the trading volume of a particular stock, as well as the
size and liquidity of the entire local market. On the whole, foreign
exchanges are smaller and less liquid than the U.S. market. This can make
buying and selling certain shares more difficult and costly. Relatively
small value transactions in some instances can have a disproportionately
large effect on the price and supply of shares. In certain situations, it
may become virtually impossible to sell a stock in an orderly fashion at a
price that approaches our estimate of its value.
. Regulatory Risk. Some foreign governments regulate their exchanges less
stringently, and the rights of shareholders may not be as firmly
established.
In an effort to reduce these foreign stock market risks, the Fund diversifies
its investments, just as you may spread your investments
9
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among a range of securities so that a setback in one need not overwhelm your
entire undermine the pursuit strategy. In this of way, a reversal in one market
or stock need not undermine the pursuit of long-term capital appreciation.
Currency Risk. The Fund invests in foreign securities denominated in foreign
currencies. This creates the possibility that changes in foreign exchange rates
will affect the value of foreign securities or the U.S. dollar amount of income
or gain received on these securities. We seek to minimize this risk by actively
mmanaging the currency exposure of the Fund.
Emerging Market Risk. To the extent that the Fund does invest in emerging
markets to enhance overall returns, it may face higher political, information,
and stock market risks. In addition, profound social changes and business
practices that depart from norms in developed countries' economies have hindered
the orderly growth of emerging economies and their stock markets in the past.
High levels of debt tend to make emerging economies heavily reliant on foreign
capital and vulnerable to capital flight. For all these reasons, the Fund
carefully limits and balances its commitment to these markets.
Secondary Risks
Small Company Risk. Although the Fund generally invests in the shares of large,
well-established companies, it may occasionally take advantage of exceptional
opportunities presented by smaller companies. Such opportunities pose unique
risks, which we take into account in considering an investment. Small company
stocks tend to experience steeper price fluctuations--down as well as up--than
the stocks of larger companies. A shortage of reliable information--the same
information gap that creates opportunity in small company investing--can also
pose added risk. Industrywide reversals have had a greater impact on small
companies, since they lack a large company's financial resources. Finally, small
company stocks are typically less liquid than large company stocks: when things
are going poorly, it is harder to find a buyer for a small company's shares.
Pricing Risk. When price quotations for securities are not readily available, we
determine their value by the method that most accurately reflects their current
worth in the judgment of the Board of Trustees. This procedure implies an
unavoidable risk, the risk that our prices are higher or lower than the prices
that the securities might actually command if we sold them. If we have valued
the securities too highly, you may end up paying too much for Fund shares when
you buy. If we
--------------------------------------------------------------------------------
Currency management is used to offset investment risks ("hedging") and, where
possible, to add to investment returns. Currency management activities include
the use of forward contracts and may include the use of other instruments. There
is no guarantee that these currency management activities will work and they
could cause losses to the Fund.
10
<PAGE>
A Detailed Look at International Equity
underestimate their price, you may not receive the full market value for your
Fund shares when you sell.
Futures and Options Risk. Although not one of its principal investment
strategies, the Fund may invest in futures contracts, options and options on
futures contracts. These investments, when made, are for hedging purposes. If
the Fund invests in futures contracts and options on futures contracts for non-
hedging purposes, the margin and premiums required to make those investments
will not exceed 5% of the Fund's net asset value after taking into account
unrealized profits and losses on the contracts. Futures contracts, options and
options on futures contracts used for non-hedging purposes involve greater risks
than stock investments.
Euro Risk. On January 1, 1999, eleven countries of the European Economic and
Monetary Union (EMU) began implementing a plan to replace their national
currencies with a new currency, the euro. Full conversion to the euro is slated
to occur by July 1, 2002.
Although it is impossible to predict the impact of the conversion to the euro on
the Fund, the risks may include:
. Changes in the relative strength and value of the U.S. dollar or other
major currencies
. Adverse effects on the business or other financial condition of European
issuers that the Fund holds in its portfolio; and
. Unpredictable effects on trade and commerce generally.
These and other factors could increase volatility in financial markets worldwide
and could adversely affect the value of securities held by the Fund.
MANAGEMENT OF THE FUND
Deutsche Asset Management is the marketing name for the asset management
activities of Deutsche Bank A.G., Deutsche Funds Management, Bankers Trust
Company, DB Alex. Brown LLC, Deutsche Asset Management, Inc., and Deutsche Asset
Management Investment Services Limited.
Board of Trustees. The Fund's shareholders, voting in proportion to the number
of shares each owns, elect a Board of Trustees, and the Trustees supervise all
of the Fund's activities on their behalf.
Investment Adviser. Under the supervision of the Board of Trustees, Bankers
Trust Company, with headquarters at 130 Liberty Street, New York, NY 10006, acts
as the Fund's
--------------------------------------------------------------------------------
Futures contracts, options and options on futures contracts are used as a
lowcost method of gaining exposure to a particular securities market without
investing directly in those securities.
11
<PAGE>
investment adviser. Bankers Trust is an indirect wholly-owned subsidiary of
Deutsche Bank A.G. As investment adviser, Bankers Trust makes the Fund's
investment decisions. It buys and sells securities for the Fund and conducts the
research that leads to the purchase and sale decisions. The investment adviser
received a fee of 0.65% of the Fund's average daily net assets for its services
in the last fiscal year. The investment adviser reimbursed a portion of its fee
during the period.
As of September 30, 1999, Bankers Trust had total assets under management of
approximately $285 billion. Bankers Trust is dedicated to servicing the needs of
corporations, governments, financial institutions, and private clients and has
invested retirement assets on behalf of the nation's largest corporations and
institutions for more than 50 years. The scope of the firm's capability is
broad: it is a leader in both the active and passive quantitative investment
disciplines and maintains a major presence in stock and bond markets worldwide.
At a special meeting of shareholders held in 1999, shareholders of the Fund
approved a new investment advisory agreement with Deutsche Asset Management,
Inc. (formerly Morgan Grenfell Inc.). The new investment advisory agreement may
be implemented within two years of the date of the special meeting upon approval
of a majority of the members of the Board of Trustees who are not "interested
persons," generally referred to as independent trustees. Shareholders of the
Fund also approved a new sub-investment advisory agreement among the Trust,
Deutsche Asset Management, Inc. and Bankers Trust under which Bankers Trust may
perform certain of Deutsche Asset Management, Inc.'s responsibilities, at
Deutsche Asset Management, Inc.'s expense, upon approval of the independent
trustees, within two years of the date of the special meeting. Under the new
investment advisory agreement and new sub-advisory agreement, the compensation
paid and the services provided would be the same as those under the existing
advisory agreement with Bankers Trust.
Deutsche Asset Management, Inc. is located at 885 Third Avenue, 32nd Floor, New
York, New York 10022. The firm provides a full range of investment advisory
services to institutional clients. It serves as investment adviser to 11 other
investment companies and as sub-adviser to five other investment companies.
12
<PAGE>
A Detailed Look at International Equity
Portfolio Managers. The following portfolio managers are responsible for the
day-to-day management of the master portfolio's investments:
Michael Levy
. Co-Lead Portfolio Manager of the master portfolio since its inception.
. International equity strategist, overseeing the design and implementation
of the firm's proprietary stock selection process.
. 28 years of business experience, 18 of them as an investment professional.
. Degrees in mathematics and geophysics from the University of Michigan.
Robert Reiner
. Co-Lead Portfolio Manager of the master portfolio since its inception.
. Specializes in Japanese and European stock and market analysis.
. Served as a Senior Financial Analyst at Scudder, Stevens & Clark from 1993
to 1994.
. 18 years of investment industry experience.
. Degrees from the University of Southern California and Harvard University.
Julie Wang
. Co-Portfolio Manager of the master portfolio since its inception.
. Focuses on the master portfolio's Asia-Pacific investments and its emerging
markets exposure.
. Served as Investment Manager for American International Group's Southeast
Asia portfolio from 1991 to 1994.
. 11 years of investment management experience.
. BS in economics from Yale University, MBA from The Wharton School,
University of Pennsylvania.
13
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Other Services. Bankers Trust provides administrative services--such as
portfolio accounting, legal services and others--for the Fund. In addition,
Bankers Trust--or your service agent--performs the functions necessary to
establish and maintain your account. In addition to setting up the account and
processing your purchase and sale orders, these functions include:
. keeping accurate, up-to-date records for your individual Fund account;
. implementing any changes you wish to make in your account information;
. processing your requests for cash dividends and distributions from the
Fund;
. answering your questions on the Fund's investment performance or
administration;
. sending proxy reports and updated prospectus information to you; and
. collecting your executed proxies.
Service agents include brokers, financial advisors or any other bank, dealer or
other institution that has a sub-shareholder servicing agreement with Bankers
Trust. Service agents may charge additional fees to investors only for those
services not otherwise included in the Bankers Trust servicing agreement, such
as cash management, or special trust or retirement-investment reporting.
Organizational Structure. The Fund is a "feeder fund" that invests all of its
assets in a "master portfolio," the International Equity Portfolio. The Fund and
its master portfolio have the same investment objective. The master portfolio is
advised by Bankers Trust, an indirect wholly-owned subsidiary of Deutsche Bank
A.G.
The master portfolio may accept investments from other feeder funds. The feeders
bear the master portfolio's expenses in proportion to their assets. Each feeder
can set its own transaction minimums, fund-specific expenses, and other
conditions. This arrangement allows the Fund's Trustees to withdraw the Fund's
assets from the master portfolio if they believe doing so is in the
shareholder's best interests. If the Trustees withdraw the Fund's assets, they
would then consider whether the Fund should hire its own investment adviser,
invest in a different master portfolio, or take other action.
14
<PAGE>
A Detailed Look at International Equity
CALCULATING THE FUND'S SHARE PRICE
We calculate the daily price of the Fund's shares (also known as the "Net Asset
Value" or "NAV") in accordance with the standard formula for valuing mutual fund
shares at the close of regular trading on the New York Stock Exchange every day
the Exchange is open for business.
The formula calls for deducting all of the Fund's liabilities from the total
value of its assets--the market value of the securities it holds, plus its cash
reserves--and dividing the result by the number of shares outstanding. (Note
that prices for securities that trade on foreign exchanges can change
significantly on days when the New York Stock Exchange is closed and you cannot
buy or sell Fund shares. Price changes in the securities the Fund owns may
ultimately affect the price of Fund shares the next time the NAV is calculated.)
We value the securities in the Fund at their stated market value if price
quotations are available. When price quotations for a particular security are
not readily available, we determine their value by the method that most
accurately reflects their current worth in the judgment of the Board of
Trustees. You can find the Fund's daily share price in the mutual fund listings
of most major newspapers.
PERFORMANCE INFORMATION
The Fund's performance can be used in advertisements that appear in various
publications. It may be compared to the performance of various indexes and
investments for which reliable performance data is available. The Fund's
performance may also be compared to averages, performance rankings, or other
information prepared by recognized mutual fund statistical services.
DIVIDENDS AND DISTRIBUTIONS
Dividends and capital gains distributions, if any, are paid annually. We
automatically reinvest all dividends and any capital gains, unless you elect to
receive your distributions in cash.
TAX CONSIDERATIONS
The Fund does not ordinarily pay income taxes. You and other shareholders pay
taxes on the income or capital gains from the Fund's holdings. Your taxes will
vary from year to year, based on the amount of capital gains distributions and
dividends paid
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The Exchange is open every week, Monday through Friday, except when the
following holidays are celebrated: New Year's Day, Martin Luther King, Jr. Day
(the third Monday in January), Presidents' Day (the third Monday in February),
Good Friday, Memorial Day (the last Monday in May), Independence Day (July 4th),
Labor Day (the first Monday in September), Thanksgiving Day (the fourth Thursday
in November) and Christmas Day.
15
<PAGE>
out by the Fund. You owe the taxes whether you receive cash or choose to have
distributions and dividends reinvested. Distributions and dividends usually
create the following tax liability:
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Transaction Tax Status
-------------------------------------------------------------------------
Income dividends Ordinary income
-------------------------------------------------------------------------
Short-term capital gains distributions Ordinary income
-------------------------------------------------------------------------
Long-term capital gains distributions Capital gains
-------------------------------------------------------------------------
Every year the Fund will send you information on the distributions for the
previous year. In addition, if you sell your Fund shares you may have a capital
gain or loss.
--------------------------------------------------------------------------------
Transaction Tax Status
--------------------------------------------------------------------------------
Your sale of shares owned more than one year Capital gains or losses
--------------------------------------------------------------------------------
Your sale of shares owned for one year or less Ordinary income
--------------------------------------------------------------------------------
Long-term capital gains distributions Gains treated as ordinary
income, losses subject to
special rules.
--------------------------------------------------------------------------------
The tax considerations for tax deferred accounts or non-taxable entities will be
different.
Because each investor's tax circumstances are unique and because the tax laws
are subject to change, we recommend that you consult your tax advisor about your
investment.
BUYING AND SELLING FUND SHARES
Contacting the Mutual Fund Service Center of Deutsche Asset Management
By phone 1-800-730-1313
By mail P.O. Box 219210
Kansas City, MO 64121-9210
By overnight mail 210 West 10th Street, 8th floor
Kansas City, MO 64105-1716
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A Detailed Look at International Equity
Retirement Service Center
By phone 1-800-677-7596
By mail P.O. Box 219210
Kansas City, MO 64121-9210
By overnight mail 210 West 10th Street, 8th floor
Kansas City, MO 64105-1716
Our representatives are available to assist you personally Monday through
Friday, 9:00 a.m. to 7:00 p.m., Eastern time each day the New York Stock
Exchange is open for business. You can reach the Service Center's automated
assistance line 24 hours a day, 7 days a week.
Minimum Account Investments
Initial purchase: Minimum amount:
A standard account $2,500
A retirement account $ 500
An automatic investment plan account $1,000
Subsequent purchase:
A standard account $ 250
A retirement account $ 100
An automatic investment plan account $ 100
Account balance:
Non-retirement account $1,000
Retirement account None
The Fund and its service providers reserve the right to, from time to time in
their discretion, waive or reduce the investment minimums.
How to Open Your Fund Account
By mail Complete and sign the account application that
accompanies this prospectus. (You may obtain
additional applications by calling the Service
Center.) Mail the completed application along with
a check payable to International Equity--463.
By wire Call the Service Center to set up a wire account.
Please note that your account cannot become activated until we receive a
completed application via mail or fax.
17
<PAGE>
If this is your first investment through a tax-sheltered retirement plan, such
as an IRA, you will need a special application form. This form is available from
your service agent, or by calling the Retirement Service Center at 1-800-677-
7596.
Two Ways to Buy and Sell Shares in Your Account
MAIL:
Buying: Send your check, payable to the Fund you have selected, to the Service
Center. The addresses are shown under "Contacting the Mutual Fund Service Center
of Deutsche Asset Management." Be sure to include the fund number and your
account number (see your account statement) on your check. Please note that we
cannot accept starter checks or third-party checks. If you are investing in more
than one fund, make your check payable to "Deutsche Asset Management (Mutual
Funds)" and include your account number, the names and numbers of the funds you
have selected, and the dollar amount or percentage you would like invested in
each fund.
Selling: Send a signed letter to the Service Center with your name, your fund
number and account number, the fund's name, and either the number of shares you
wish to sell or the dollar amount you wish to receive. You must leave at least
$1,000 invested in your account to keep it open. Unless exchanging into another
Deutsche Asset Management mutual fund, you must submit a written authorization
to sell shares in a retirement account.
WIRE:
Buying: You may buy shares by wire only if your account is authorized to do so.
Please note that you or your service agent must call the Service Center at 1-
800-730-1313 to notify us in advance of a wire transfer purchase. Inform the
Service Center representative of the amount of your purchase and receive a trade
confirmation number. Instruct your bank to send payment by wire using the wire
instructions noted below. All wires must be received by 4:00 p.m. Eastern time
the next business day.
Routing No: 021001033
Attn: Deutsche Asset Management/ Mutual Funds
DDA No: 00-226-296
FBO: (Account name)
(Account number)
Credit: International Equity--463
Refer to your account statement for the account name and number.
18
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A Detailed Look at International Equity
Selling: You may sell shares by wire only if your account is authorized to do
so. For your protection, you may not change the destination bank account over
the phone. To sell by wire, contact your service agent or the Service Center at
1-800-730-1313. Inform the Service Center representative of the amount of your
redemption and receive a trade confirmation number. The minimum redemption by
wire is $1,000. We must receive your order by 4:00 p.m. Eastern time to wire
your account the next business day.
Important Information about Buying and Selling Shares
. You may buy and sell shares of a fund through authorized service agents as
well as directly from us. The same terms and conditions apply.
Specifically, once you place your order with a service agent, it is
considered received by the Service Center. It is then your service agent's
responsibility to transmit the order to the Service Center by the next
business day. You should contact your service agent if you have a dispute
as to when your order was placed with the fund. Your service agent may
charge a fee for buying and selling shares for you.
. You may place orders to buy and sell over the phone by calling your service
agent or the Service Center at 1-800-730-1313. If you pay for shares by
check and the check fails to clear, or if you order shares by phone and
fail to pay for them by 4:00 p.m. Eastern time the next business day, we
have the right to cancel your order, hold you liable or charge you or your
account for any losses or fees a fund or its agents have incurred. To sell
shares, you must state whether you would like to receive the proceeds by
wire or check.
. After we or your service agent receives your order, we buy or sell you
shares at the next price calculated on a day the New York Stock Exchange is
open for business.
. We accept payment for shares only in U.S. dollars by check, bank or Federal
Funds wire transfer, or by electronic bank transfer. Please note that we
cannot accept starter checks or third-party checks.
. The payment of redemption proceeds (including exchanges) for shares of a
fund recently purchased by check may be delayed for up to 15 calendar days
while we wait for your check to clear.
. We process all sales orders free of charge.
. Unless otherwise instructed, we normally mail a check for the proceeds from
the sale of your shares to your account address the next business day but
always within seven days.
19
<PAGE>
. You can exchange all or part of your shares for shares in another Deutsche
Asset Management mutual fund up to four times a year (from the date of the
first exchange). When you exchange shares, you are selling shares in one
fund to purchase shares in another. Before buying shares through an
exchange, you should obtain a copy of that fund's prospectus and read it
carefully. You may order exchanges over the phone only if your account is
authorized to do so.
Please note the following conditions:
. The accounts between which the exchange is taking place must have
the same name, address and taxpayer ID number.
. You may make the exchange by phone, letter or wire, if your
account has the exchange by phone feature.
. If you are maintaining a taxable account, you may have to pay
taxes on the exchange.
. You will receive a written confirmation of each transaction from
the Service Center or your service agent.
. We reserve the right to close your account on 30 days' notice if it fails
to meet minimum balance requirements for any reason other than a change in
market value.
If you sell shares by mail or wire, you may be required to obtain a signature
guarantee. Please contact your service agent or the Service Center for more
information.
. We remit proceeds from the sale of shares in U.S. dollars (unless the
redemption is so large it is made "in-kind").
. We do not issue share certificates.
. Selling shares of trust accounts and business or organization accounts may
require additional documentation. Please contact your service agent or the
Service Center for more information.
. During periods of heavy market activity, you may have trouble reaching the
Service Center by telephone. If this occurs, you should make your request
by mail.
. We reserve the right to reject purchases of Fund shares (including
exchanges) for any reason. We will reject purchases if we conclude that the
purchaser may be investing only for the short-term or for the purpose of
profiting from day to day fluctuations in the Fund's share price.
. We reserve the right to reject purchases of Fund shares (including
exchanges) or to suspend or postpone redemptions at times when both the New
York Stock Exchange and the Fund's custodian are closed.
20
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A Detailed Look at International Equity
Special Shareholder Services
To help make investing with us as easy as possible, and to help you build your
investment, we offer the following special services. You can obtain further
information about these programs by calling the Service Center at 1-800-730-
1313.
. Regular Investments: You can make regular investments of $100 or more
automatically from your checking account bi-weekly, monthly, quarterly, or
semi-annually.
. Regular Withdrawals: You can arrange regular monthly, quarterly, semi-
annual and annual sales of shares in your account. The minimum transaction
is $100, and the account must have a balance of at least $10,000 to
qualify.
. Account Statements and Fund Reports: We or your service agent will furnish
you with a written confirmation of every transaction that affects your
account balance. You will also receive monthly statements reflecting the
balances in your account. We will send you a report every six months on
your fund's overall performance, its current holdings and its investing
strategies.
21
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A Detailed Look at International Equity
The table below provides a picture of the Fund's financial performance for
the past five years. The information selected reflects financial results
for a single Fund share. The total returns in the table represent the rate
of return that an investor would have earned on an investment in the Fund
(assuming reinvestment of all dividends and distributions). This
information has been audited by PricewaterhouseCoopers LLP whose report,
along with the Fund's financial statements, is included in the Fund's
annual report. The annual report is available free of charge by calling the
Service Center at 1-800-730-1313.
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
Financial Highlights
For the period
For the period January 1, 1995 For the year
October 1, 1999 For the year ended September 30, through ended
to October 31, September 30, December 31,
1999/1/ 1999 1998 1997 1996 1995/2/ 1994
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net Asset Value, Beginning of
Period $ 24.22 $ 20.68 $ 22.13 $ 16.77 $ 15.47 $ 13.37 $ 13.18
------------------------------------------------------------------------------------------------------------------------------------
Income From Investment Operations
Net Investment (Expenses in
Excess of) Income (0.02) 0.04 0.02 0.09 0.18 0.14 0.10
------------------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain
(Loss) on Investment, Option,
Foreign Currency, Forward
Foreign Currency and Foreign
Futures Contracts 1.13 3.56 (0.87) 5.63 1.80 1.97 0.44
------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.11 3.60 (0.85) 5.72 1.98 2.11 0.54
====================================================================================================================================
Distributions to Shareholders
-----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income - (0.06) (0.01) (0.16) (0.31) - (0.09)
-----------------------------------------------------------------------------------------------------------------------------------
Net Realized Gains - - (0.59) (0.20) (0.37) (0.01) (0.26)
------------------------------------------------------------------------------------------------------------------------------------
Total Distributions - (0.06) (0.60) (0.36) (0.68) (0.01) (0.35)
====================================================================================================================================
Net Asset Value, End of Period $ 25.33 $ 24.22 $ 20.68 $ 22.13 $ 16.77 $ 15.47 $ 13.37
------------------------------------------------------------------------------------------------------------------------------------
Total Investment Return 4.63% 17.35% (3.73%) 34.76% 13.42% 15.82% 4.12%
====================================================================================================================================
Supplemental Data and Ratios:
Net Assets, End of Period (000s
omitted) $1,913,667 $1,851,230 $1,251,580 $525,520 $161,692 $82,807 $56,020
------------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets: 0.84%
Net Investment (Expenses in
Excess of) Income (0.93)%/3/ 0.19% 0.61% 0.53% 0.91% 1.55%/3/ 1.50%
------------------------------------------------------------------------------------------------------------------------------------
Expenses, Including Expenses of
the International Equity Portfolio 1.50%/3/ 1.50% 1.50% 1.50% 1.50% 1.50%/3/ 0.37%
------------------------------------------------------------------------------------------------------------------------------------
Decrease Reflected in Above
Expense Ratio Due to Fees
Waived/Expenses Reimbursed
by Bankers Trust 0.20%/3/ 0.16% 0.20% 0.18% 0.26% 0.33%/3/
------------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover Rate/4/ 5% 106% 65% 63% 68% 21% 15%
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
__________________________
/1/ On September 8, 1999, the Board of Trustees approved the change of the
fiscal year end from September 30 to October 31.
/2/ August 2, 1995, the Board of Trustees approved the change of the
fiscal year end from December 31 to September 30.
/3/ Annualized.
/4/ The portfolio turnover rate is the rate for the master portfolio into
which the Fund invests all of its assets.
22
<PAGE>
Additional information about the Fund's investments and performance is available
in the Fund's annual and semi-annual reports to shareholders. In the Fund's
annual report, you will find a discussion of the market conditions and
investment strategies that significantly affected the Fund's performance during
its last fiscal year.
You can find more detailed information about each Fund in the current Statement
of Additional Information, dated January 31, 2000, which we have filed
electronically with the Securities and Exchange Commission (SEC) and which is
incorporated by reference. To receive your free copy of the Statement of
Additional Information, the annual or semi-annual report, or if you have
questions about investing in the Fund, write to us at:
Service Center
P.O. Box 219210
Kansas City, MO 64121-9210
or call our toll-free number: 1-800-730-1313
You can find reports and other information about the Fund on the EDGAR Database
on the SEC's website (http://www.sec.gov), or you can get copies of this
information, after payment of a duplicating fee, by electronic request at
[email protected] or by writing to the Public Reference Section of the SEC,
Washington, D.C. 20549-0102. Information about the Fund, including its Statement
of Additional Information, can be reviewed and copied at the SEC's Public
Reference Room in Washington, D.C. For information on the Public Reference Room,
call the SEC at 202-942-8090.
International Equity
BT Investment Funds
Distributed by:
ICC Distributors, Inc. CUSIP #055922868
Two Portland Square 463PRO (10/00)
Portland, ME 04101 811-4760
