File No.33-11351
Rule 497(e)
STEIN ROE INVESTMENT TRUST
Growth and Income Funds
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Stein Roe Growth & Income Fund
Stein Roe Balanced Fund
Growth Funds
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Stein Roe Growth Stock Fund
Stein Roe Special Venture Fund
Stein Roe Young Investor Fund
Stein Roe Capital Opportunities Fund
Stein Roe Special Fund
Stein Roe International Fund
Supplement to February 3, 1997 Statement of Additional
Information
SWAPS, CAPS, FLOORS AND COLLARS. Each Fund may enter
into swaps and may purchase or sell related caps, floors and
collars. A Fund would enter into these transactions
primarily to preserve a return or spread on a particular
investment or portion of its portfolio, to protect against
currency fluctuations, as a duration management technique or
to protect against any increase in the price of securities it
purchasing at a later date. The Funds intend to use these
techniques as hedges and not as speculative investments and
will not sell interest rate income stream a Fund may be
obligated to pay.
A swap agreement is generally individually negotiated
and structured to include exposure to a variety of different
types of investments or market factors. Depending on its
structure, a swap agreement may increase or decrease a Fund's
exposure to changes in the value of an index of securities in
which the Fund might invest, the value of a particular
security or group of securities, or foreign currency values.
Swap agreements can take many different forms and are known
by a variety of names. A Fund may enter into any form of
swap agreement if the Adviser determines it is consistent
with its investment objective and policies.
A swap agreement tends to shift a Fund's investment
exposure from one type of investment to another. For
example, if a Fund agrees to exchange payments in dollars at
a fixed rate for payments in a foreign currency the amount of
which is determined by movements of a foreign securities
index, the swap agreement would tend to increase exposure to
foreign stock market movements and foreign currencies.
Depending on how it is used, a swap agreement may increase or
decrease the overall volatility of a Fund's investments and
its net asset value.
The performance of a swap agreement is determined by the
change in the specific currency, market index, security, or
other factors that determine the amounts of payments due to
and from a Fund. If a swap agreement calls for payments by a
Fund, the Fund must be prepared to make such payments when
due. If the counterparty's creditworthiness declines, the
value of a swap agreement would be likely to decline,
potentially resulting in a loss. A Fund will not enter into
any swap, cap, floor or collar transaction unless, at the
time of entering into such transaction, the unsecured long-
term debt of the counterparty, combined with any credit
enhancements, is rated at least A by Standard & Poor's
Corporation or Moody's or has an equivalent rating from a
nationally recognized statistical rating organization or is
determined to be of equivalent credit quality by the Adviser.
The purchase of a cap entitles the purchaser to receive
payments on a notional principal amount from the party
selling the cap to the extent that a specified index exceeds
a predetermined interest rate or amount. The purchase of a
floor entitles the purchaser to receive payments on a
notional principal amount from the party selling such floor
to the extent that a specified index falls below a
predetermined interest rate or amount. A collar is a
combination of a cap and floor that preserves a certain
return within a predetermined range of interest rates or
values.
At the time a Fund enters into swap arrangements or
purchases or sells caps, floors or collars, liquid assets of
the Fund having a value at least as great as the commitment
underlying the obligations will be segregated on the books of
the Fund and held by the custodian throughout the period of
the obligation.
NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. The following
non-fundamental investment restrictions (see Investment
Restrictions, pages 24-27) have been eliminated by vote of
the Boards of Trustees of Investment Trust and Base Trust:
(d) [No Fund or Portfolio may] purchase or hold
securities of an issuer if 5% of the securities of such
issuer are owned by those officers, trustees, or directors of
the Trust or of its investment adviser, who each own
beneficially more than 1/2 of 1% of the securities of that
issuer;
(e) mortgage, pledge, or hypothecate its assets, except
as may be necessary in connection with permitted borrowings
or in connection with options, futures, and options on
futures;
(i) buy or sell an option on a security, a futures
contract, or an option on a futures contract unless the
option, the futures contract, or the option on the futures
contract is offered through the facilities of a recognized
securities association or listed on a recognized exchange or
similar entity;
(l) invest more than 5% of its total assets (taken at
market value at the time of a particular investment) in
securities of issuers (other than issuers of federal agency
obligations or securities issued or guaranteed by any foreign
country or asset-backed securities) that, together with any
predecessors or unconditional guarantors, have been in
continuous operation for less than three years ("unseasoned
issuers");
(n) invest more than 15% of its total assets (taken at
market value at the time of a particular investment) in
restricted securities and securities of unseasoned issuers.
This Supplement is Dated August 7, 1997
<PAGE>
STEIN ROE INVESTMENT TRUST
Stein Roe Emerging Markets Fund
Supplement to Statement of Additional Information Dated
February 3, 1997 as revised and supplemented through June
9, 1997
NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. The following
non-fundamental investment restrictions (see Investment
Restrictions, pages 24-27) have been eliminated by vote of
the Board of Trustees of Investment Trust:
(d) [The Fund may not] purchase or hold securities of
an issuer if 5% of the securities of such issuer are owned by
those officers, trustees, or directors of the Trust or of its
investment adviser, who each own beneficially more than 1/2
of 1% of the securities of that issuer;
(e) mortgage, pledge, or hypothecate its assets, except
as may be necessary in connection with permitted borrowings
or in connection with options, futures, and options on
futures;
(h) buy or sell an option on a security, a futures
contract, or an option on a futures contract unless the
option, the futures contract, or the option on the futures
contract is offered through the facilities of a recognized
securities association or listed on a recognized exchange or
similar entity;
(k) invest more than 5% of its total assets (taken at
market value at the time of a particular investment) in
securities of issuers (other than issuers of federal agency
obligations or securities issued or guaranteed by any foreign
country or asset-backed securities) that, together with any
predecessors or unconditional guarantors, have been in
continuous operation for less than three years ("unseasoned
issuers");
(m) invest more than 15% of its total assets (taken at
market value at the time of a particular investment) in
restricted securities and securities of unseasoned issuers.
This Supplement is Dated August 7, 1997
<PAGE>
STEIN ROE INVESTMENT TRUST
Stein Roe Growth Opportunities Fund
Supplement to May 9, 1997 Statement of Additional Information
SWAPS, CAPS, FLOORS AND COLLARS. The Fund may enter
into swaps and may purchase or sell related caps, floors and
collars. The Fund would enter into these transactions
primarily to preserve a return or spread on a particular
investment or portion of its portfolio, to protect against
currency fluctuations, as a duration management technique or
to protect against any increase in the price of securities it
purchasing at a later date. The Fund intends to use these
techniques as hedges and not as speculative investments and
will not sell interest rate income stream the Fund may be
obligated to pay.
A swap agreement is generally individually negotiated
and structured to include exposure to a variety of different
types of investments or market factors. Depending on its
structure, a swap agreement may increase or decrease the
Fund's exposure to changes in the value of an index of
securities in which the Fund might invest, the value of a
particular security or group of securities, or foreign
currency values. Swap agreements can take many different
forms and are known by a variety of names. The Fund may
enter into any form of swap agreement if the Adviser
determines it is consistent with its investment objective and
policies.
A swap agreement tends to shift the Fund's investment
exposure from one type of investment to another. For
example, if the Fund agrees to exchange payments in dollars
at a fixed rate for payments in a foreign currency the amount
of which is determined by movements of a foreign securities
index, the swap agreement would tend to increase exposure to
foreign stock market movements and foreign currencies.
Depending on how it is used, a swap agreement may increase or
decrease the overall volatility of the Fund's investments and
its net asset value.
The performance of a swap agreement is determined by the
change in the specific currency, market index, security, or
other factors that determine the amounts of payments due to
and from the Fund. If a swap agreement calls for payments by
the Fund, the Fund must be prepared to make such payments
when due. If the counterparty's creditworthiness declines,
the value of a swap agreement would be likely to decline,
potentially resulting in a loss. The Fund will not enter
into any swap, cap, floor or collar transaction unless, at
the time of entering into such transaction, the unsecured
long-term debt of the counterparty, combined with any credit
enhancements, is rated at least A by Standard & Poor's
Corporation or Moody's or has an equivalent rating from a
nationally recognized statistical rating organization or is
determined to be of equivalent credit quality by the Adviser.
The purchase of a cap entitles the purchaser to receive
payments on a notional principal amount from the party
selling the cap to the extent that a specified index exceeds
a predetermined interest rate or amount. The purchase of a
floor entitles the purchaser to receive payments on a
notional principal amount from the party selling such floor
to the extent that a specified index falls below a
predetermined interest rate or amount. A collar is a
combination of a cap and floor that preserves a certain
return within a predetermined range of interest rates or
values.
At the time the Fund enters into swap arrangements or
purchases or sells caps, floors or collars, liquid assets of
the Fund having a value at least as great as the commitment
underlying the obligations will be segregated on the books of
the Fund and held by the custodian throughout the period of
the obligation.
NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. The following
non-fundamental investment restrictions (see Investment
Restrictions, pages 19-22) have been eliminated by vote of
the Board of Trustees of Investment Trust:
(d) [The Fund may not] purchase or hold securities of
an issuer if 5% of the securities of such issuer are owned by
those officers, trustees, or directors of the Trust or of its
investment adviser, who each own beneficially more than 1/2
of 1% of the securities of that issuer;
(e) mortgage, pledge, or hypothecate its assets, except
as may be necessary in connection with permitted borrowings
or in connection with options, futures, and options on
futures;
(i) buy or sell an option on a security, a futures
contract, or an option on a futures contract unless the
option, the futures contract, or the option on the futures
contract is offered through the facilities of a recognized
securities association or listed on a recognized exchange or
similar entity;
(l) invest more than 5% of its total assets (taken at
market value at the time of a particular investment) in
securities of issuers (other than issuers of federal agency
obligations or securities issued or guaranteed by any foreign
country or asset-backed securities) that, together with any
predecessors or unconditional guarantors, have been in
continuous operation for less than three years ("unseasoned
issuers");
(n) invest more than 15% of its total assets (taken at
market value at the time of a particular investment) in
restricted securities and securities of unseasoned issuers.
This Supplement is Dated August 7, 1997
