American AAdvantage Funds - AMR Class
Supplement dated January 23, 1998
to the Prospectus dated March 1, 1997
1.Effective January 16, 1998, Brandywine Asset Management, Inc.
("Brandywine") was acquired, and became a wholly owned
subsidiary of, Legg Mason, Inc. in an exchange of stock.
Brandywine continues to serve as an investment adviser to the
American AAdvantage Balanced Fund and the American AAdvantage
Growth and Income Fund with the same investment personnel as
it employed before the acquisition.
2.All references to Hub & Spoker should be replaced by "master-
feeder" and footnote 2 on page 2 should be deleted.
3.Effective January 1, 1998, the International Equity Portfolio
may invest in Portugal.
4.The section titled "Custodian and Transfer Agent" on page 29
should read:
State Street Bank & Trust Company, Boston, Massachusetts,
serves as custodian for the Portfolios of the AMR Trust and
the Funds and as transfer as agent for the AMR Class. Bankers
Trust Company, New York, New York, serves as custodian and
transfer agent for the assets of the Equity 500 Index
Portfolio.
5.Add Martin Luther King's Birthday to the list of New York
Stock Exchange business holidays on page 33.
6.Effective January 2, 1998, the phone number for purchase and
redemption of shares is (800) 492-9063. Wire purchases should
be sent to: State Street Bank & Trust Company, ABA Routing
#0110-0002-8, AC-0002-888-6, Attn: American AAdvantage Funds-
AMR Class and reference the specific Fund. Purchases by mail
should be sent to: State Street Bank & Trust Company, P.O. Box
1978, Boston, MA 02105-1978, Attn: American AAdvantage Funds-
AMR Class.
7.On May 31, 1997, Morgan Stanley Group Inc. and Dean Witter,
Discover & Co. merged to form Morgan Stanley, Dean Witter,
Discover & Co. As of that date, Morgan Stanley Asset
Management Inc., an investment adviser to the American
AAdvantage International Equity Fund, became a subsidiary of
Morgan Stanley, Dean Witter, Discover & Co.
8.The financial highlights in the following table for the
American AAdvantage S&P 500 Index Fund have been derived from
financial statements of the American AAdvantage Funds. The
information is unaudited. Such information should be read in
conjunction with the financial statements incorporated in the
statement of additional information, as supplemented July 30,
1997, which contains further information about performance of
the Funds and can be obtained by investors without charge.
American AAdvantage S&P 500 Index Fund - Financial Highlights
Contained below are selected data for a share outstanding,
total investment return, ratios to average net assets and
other supplemental data for the American AAdvantage S&P 500
Index Fund.
<TABLE>
<CAPTION>
For the
six months
ended June 30,
1997(1)
<S> <C>
Per Share Operating Performance:
Net Asset Value, Beginning of Period..... $ 10.00
__________
Income From Investment Operations
Net Investment Income.................. 0.06
Net Realized and Unrealized Gain on
Investments and Futures Transactions. 1.99
__________
Total From Investment Operations......... 2.05
__________
Distributions To Shareholders
Net Investment Income................. (0.02)
Net Realized Gain on Investments and
Futures Transactions................ -
__________
Total Distributions................... (0.02)
==========
Net Asset Value, End of Period........... $ 12.03
Total Investment Return.................. 20.50%
Supplemental Data and Ratios:
Net Assets, End of Period (000s omitted) $ 2,832
Ratios to Average Net Assets:
Net Investment Income................ 1.77%(2)
Expenses, including expenses of the BT
Equity 500 Index Portfolio...... 0.22%(2)
Decrease Reflected in Above Expense Ratio
Due to Absorption of Expenses by AMR
Investment Services, Inc.......... 1.62%(2)
</TABLE>
______________
(1) Unaudited
(2) Annualized
American AAdvantage Funds - Institutional Class
Supplement dated January 23, 1998
to the Prospectus dated March 1, 1997
Effective January 16, 1998, Brandywine Asset Management,
Inc. ("Brandywine") was acquired, and became a wholly owned
subsidiary of, Legg Mason, Inc. in an exchange of stock.
Brandywine continues to serve as an investment adviser to the
American AAdvantage Balanced Fund and the American AAdvantage
Growth and Income Fund with the same investment personnel as it
employed before the acquisition.
American AAdvantage Funds - PlanAhead Class
Supplement dated January 23, 1998
to the Prospectus dated March 1, 1997
Effective January 16, 1998, Brandywine Asset Management,
Inc. ("Brandywine") was acquired, and became a wholly owned
subsidiary of, Legg Mason, Inc. in an exchange of stock.
Brandywine continues to serve as an investment adviser to the
American AAdvantage Balanced Fund and the American AAdvantage
Growth and Income Fund with the same investment personnel as it
employed before the acquisition.
