MUTUAL FUND GROUP, 485APOS, 1996-10-16

MUTUAL FUND GROUP
485APOS, 1996-10-16

Previous: SUMMIT TECHNOLOGY INC, 8-K, 1996-10-16

Next: TECHKNITS INC, 10-Q, 1996-10-16

As filed via EDGAR with the Securities and Exchange
Commission on October 16, 1996

File No. 811-5151
Registration No. 33-14196
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

------------------

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 | |

Pre-Effective Amendment No. |_|

Post-Effective Amendment No. 38 |X|

and

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 | |

Post-Effective Amendment No. 77 |X|
-------------------------------
MUTUAL FUND GROUP
(Exact Name of Registrant as Specified in Charter)

101 Park Avenue
New York, New York 10178
--------------------------------------------------
(Address of Principal Executive Office)

Registrant's Telephone Number, including Area Code: (212) 492-1600

George Martinez, Esq. Niall L. O'Toole, Esq. Gary S. Schpero, Esq.
BISYS Fund Services, Inc. Chase Manhattan Bank Simpson Thacher & Bartlett
3435 Stelzer Road 270 Park Avenue 425 Lexington Avenue
Columbus, Ohio 43219 New York, New York 10017 New York, New York 10017
- --------------------------------------------------------------------------------

(Name and Address of Agent for Service)

It is proposed that this filing will become effective:

If appropriate, check the following box:

|_| this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

------------------

The Registrant has registered an indefinite number or amount of its shares of
common stock for each of its series under the Securities Act of 1933 pursuant to
Rule 24f-2 under the Investment Company Act of 1940 on July 18, 1994 and
Registrant's Rule 24f-2 Notice was filed on November 27, 1995.

The Trustees of the Hub Portfolios have also executed this registration
statement.

<PAGE>

MUTUAL FUND GROUP
Registration Statement on Form N-1A

CROSS-REFERENCE SHEET
Pursuant to Rule 495(a) Under the Securities Act of 1933

VISTA(SM) U.S. TREASURY INCOME FUND
VISTA(SM) BALANCED FUND
VISTA(SM) EQUITY INCOME FUND
VISTA(SM) GROWTH AND INCOME FUND
VISTA(SM) CAPITAL GROWTH FUND
VISTA(SM) LARGE CAP EQUITY FUND
VISTA(SM) BOND FUND
VISTA(SM) SHORT-TERM BOND FUND
VISTA(SM) GLOBAL FIXED INCOME FUND
VISTA(SM) INTERNATIONAL EQUITY FUND
VISTA(SM) SMALL CAP EQUITY FUND
VISTA(SM) U.S. GOVERNMENT SECURITIES FUND
VISTA(SM) AMERICAN VALUE FUND
VISTA(SM) SOUTHEAST ASIAN FUND
VISTA(SM) JAPAN FUND
VISTA(SM) EUROPEAN FUND
VISTA(SM) EMERGING GROWTH FUND
VISTA(SM) SELECT GROWTH AND INCOME FUND

<TABLE>
<CAPTION>
Item Number
Form N-1A, Statement of Additional
Part A Prospectus Caption Information Caption
- ----------- ------------------ -----------------------
<S> <C> <C>

Captions apply to all Prospectuses except where
indicated in parenthesis. Parenthesis indicate
captions for Institutional Shares Prospectuses

1 Front Cover Page *

2(a) Expense Summary *

(b) Not Applicable *

3(a) Financial Highlights *

(b) Not Applicable *

4(a)(b) Other Information *
Concerning the Fund;
Fund Objective; Investment
Policies

(d) Not Applicable *

5(a) Management *

(b) Management *

(c)(d) Management; Other Information Concerning the Fund *
</TABLE>

-i-
<PAGE>

<TABLE>
<CAPTION>
Item Number
Form N-1A, Statement of Additional
Part A Prospectus Caption Information Caption
- ----------- ------------------ -----------------------
<S> <C> <C>

(e) Other Information Concerning *
the Fund; Back Cover Page

(f) Other Information Concerning *
the Fund

(g) Not Applicable *

5A Not Applicable *

6(a) Other Information Concerning *
the Fund

(b) Not Applicable *

(d) Not Applicable *

(e)(f) About Your Investment; How to Buy, Sell *
and Exchange Shares (How to Purchase, Redeem
and Exchange Shares); How Distributions Are
Made; Tax Information; Other Information
Concerning the Fund; Make the Most of Your
Vista Privileges.

(f) How Distributions are Made; *
Tax Information

(g) How Distributions are Made; Tax Matters
Tax Information

(h) About Your Investment; How to Buy, *
Sell and Exchange Shares (How to
Purchase, Redeem and Exchange Shares);
Other Information Concerning the Fund

7(a) How to Buy, Sell and Exchange *
Shares (How to Purchase, Redeem
and Exchange Shares)

(b) How the Fund Values its Shares; *
How to Buy, Sell and Exchange
Shares (How to Purchase, Redeem
and Exchange Shares)

(d) How to Buy, Sell and Exchange *
Shares (How to Purchase, Redeem and
Exchange Shares)

</TABLE>

-ii-

<PAGE>

<TABLE>
<CAPTION>
Item Number
Form N-1A, Statement of Additional
Part A Prospectus Caption Information Caption
- ----------- ------------------ -----------------------
<S> <C> <C>

(e) Management; Other Information *
Concerning the Fund

(f) Other Information Concerning the *
Fund

8(a) How to Buy, Sell and Exchange *
Shares (How to Purchase, Redeem
and Exchange Shares)

(b) How to Buy, Sell and Exchange *
Shares (How to Purchase, Redeem
and Exchange Shares)

(d) How to Buy, Sell and Exchange *
Shares (How to Purchase, Redeem
and Exchange Shares)

9 Not Applicable *
</TABLE>

-iii-

<PAGE>

<TABLE>
<CAPTION>
Item Number
Form N-1A, Statement of Additional
Part B Prospectus Caption Information Caption
- ----------- ------------------ -----------------------
<S> <C> <C>

10 * Front Cover Page

11 * Front Cover Page

12 * Not Applicable

13(a)(b) Fund Objective; Investment Investment Policies
Policies and Restrictions

14(c) * Management of the Trust and
Funds or Portfolios

(b) * Not Applicable

15(a) * Not Applicable

(b) * General Information

16(a) Management Management of the Trust and
Funds or Portfolios

(b) Management Management of the Trust and
Funds or Portfolios

(d) Management Management of the Trust and
Funds or Portfolios

(e) * Not Applicable
</TABLE>
-iv-

<PAGE>
<TABLE>
<CAPTION>
Item Number
Form N-1A, Statement of Additional
Part B Prospectus Caption Information Caption
- ----------- ------------------ -----------------------
<S> <C> <C>

(f) How to Buy, Sell and Exchange Shares Management of the Trust and
(How to Purchase, Redeem and Exchange Shares); Funds or Portfolios
Other Information Concerning the Fund

(g) * Not Applicable

(h) * Management of the Trust and
Funds or Portfolios;
Independent Accountants

(i) * Not Applicable

17 Investment Policies Investment Policies and Restrictions

18(a) Other Information Concerning the Fund; General Information
How to Buy, Sell and Exchange Shares
(How to Purchase, Redeem and Exchange
Shares)

(b) * Not Applicable

19(a) How to Buy, Sell and Exchange Shares Purchases, Redemptions and Exchanges
(How to Purchase, Redeem and Exchange
Shares)

(b) How the Fund Values its Shares; How to Determination of Net Asset Value
Buy, Sell and Exchange Shares (How to
Purchase, Redeem and Exchange Shares)

20 How Distributions are Made; Tax Information Tax Matters

21(a) * Management of the Trust and Funds
or Portfolios

(b) * Management of the Trust and Funds
or Portfolios

22 * Performance Information

23 * Not Applicable
</TABLE>

-v-
<PAGE>

EXPLANATORY NOTE

The Prospectuses for the Class A and Class B Shares of the Vista U.S. Treasury
Income Fund, Vista Bond Fund, Vista Large Cap Equity Fund, Vista Equity Income
Fund, Vista Small Cap Equity Fund, Vista Growth and Income Fund, Vista Balanced
Fund, Vista Capital Growth Fund, Vista International Equity Fund, Vista Global
Fixed Income Fund, Vista Southeast Asian Fund, Vista European Fund and Vista
Japan Fund, the Prospectuses for the Class A Shares of the Vista Short-Term Bond
Fund and Vista U.S. Government Securities Fund, the Prospectus for Shares of the
Vista American Value Fund, and the Prospectuses for the Institutional Shares of
the Vista U.S. Government Securities Fund, Vista Short-Term Bond Fund, Vista
Bond Fund, Vista Large Cap Equity Fund, Vista Small Cap Equity Fund, Vista
Growth and Income Fund and Vista Capital Growth Fund, each dated May 6, 1996,
are incorporated by reference to the Registrant's filing of definitive copies
under Rule 497 (c) of the Securities Act of 1933, as amended (the "Securities
Act"), on May 9, 1996.

The Prospectus for Class A and Class B shares of the Vista Emerging Growth Fund
is incorporated by reference to the Registrant's filing of Form N-1A pursuant to
Rule 485(a) of the Securities Act on August 6, 1996.

The Prospectus Supplement for the Vista Large Cap Equity Fund dated May 10,
1996 is incorporated by reference to the Registrant's filing of a definitive
copy under Rule 497 (e) of the Securities Act on May 10, 1996.

The Prospectus Supplement for the Vista European Fund, Vista Southeast Asian
Fund and Vista Japan Fund dated May 30, 1996 is incorporated by reference to
the Registrant's filing of a definitive copy under Rule 497 (e) of the
Securities Act on May 30, 1996.

The Prospectus Supplement for the Vista Balanced Fund, Vista Bond Fund, Vista
Short-Term Bond Fund, Vista U.S. Government Securities Fund and Vista U.S.
Treasury Income Fund dated June 25, 1996 is incorporated by reference to the
Registrant's filing of a definitive copy under Rule 497 (e) of the Securities
Act on June 28, 1996.

The Prospectus Supplement for the Class A and Class B Shares of the Vista U.S.
Treasury Income Fund, Vista U.S. Government Securities Fund, Vista Bond Fund,
Vista Large Cap Equity Fund, Vista Balanced Fund, Vista Equity Income Fund,
Vista Growth and Income Fund, Vista Capital Growth Fund, Vista International
Equity Fund, Vista Global Fixed Income Fund, Vista Southeast Asian Fund, Vista
European Fund, Vista Japan Fund and Vista Short-Term Bond Fund dated July 1,
1996 is incorporated by reference to the Registrant's filing of a definitive
copy under Rule 497 (e) of the Securities Act on July 2, 1996.

The Prospectus Supplement for the Vista Small Cap Equity Fund dated July 1,
1996 is incorporated by reference to the Registrant's filing of a definitive
copy under Rule 497 (e) of the Securities Act on July 2, 1996.

The Statement of Additional Information for the Vista U.S. Treasury Income Fund,
Vista Bond Fund, Vista Large Cap Equity Fund, Vista Balanced Fund, Vista Equity
Income Fund, Vista Small Cap Equity Fund, Vista Growth and Income Fund, Vista
Capital Growth Fund, Vista American Value Fund, Vista U.S. Government Securities
Fund, Vista Short-Term Bond Fund and Vista Emerging Growth Fund is incorporated
by reference to the Registrant's filing of Form N-1A pursuant to Rule 485(a) of
the Securities Act on August 6, 1996.

The Statement of Additional Information for the Vista International Equity Fund,
Vista Global Fixed Income Fund, Vista Southeast Asian Fund, Vista European Fund
and Vista Japan Fund (the "International SAI"), dated May 6, 1996, is
incorporated by reference to the Registrant's filing of definitive copies under
Rule 497 (c) of the Securities Act on May 9, 1996.

The Statement of Additional Information Supplement for the International SAI
dated July 12, 1996 is incorporated by reference to the Registrant's filing of a
definitive copy under rule 497(e) of the Securities Act on July 18, 1996.

<PAGE>
(VISTA LOGO)

PROSPECTUS

VISTA SELECT GROWTH AND INCOME FUND

Investment Strategy:
Growth and Income

, 1996

This Prospectus explains concisely what you should know before investing. Please
read it carefully and keep it for future reference. You can find more detailed
information about the Fund in its _____, 1996 Statement of Additional
Information, as amended periodically (the "SAI"). For a free copy of the SAI,
call the Vista Service Center at 1-800-34-VISTA. The SAI has been filed with the
Securities and Exchange Commission and is incorporated into this Prospectus by
reference.

The Fund, unlike many other investment companies which directly acquire and
manage their own portfolios of securities, seeks its investment objective by
investing all of its investable assets in Growth and Income Portfolio (the
"Portfolio"), an open-end management investment company with investment
objectives identical to those of the Fund. Investors should carefully consider
this investment approach. For additional information regarding this investment
structure, see "Unique Characteristics of Master/ Feeder Fund Structure" on page
15.

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.

INVESTMENTS IN THE FUND ARE SUBJECT TO RISK-- INCLUDING POSSIBLE LOSS OF
PRINCIPAL--AND WILL FLUCTUATE IN VALUE. SHARES OF THE FUND ARE NOT BANK DEPOSITS
OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, THE CHASE MANHATTAN BANK OR ANY
OF ITS AFFILIATES AND ARE NOT INSURED BY, OBLIGATIONS OF OR OTHERWISE SUPPORTED
BY THE U.S. GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY.

<PAGE>
[This Page Intentionally Left Blank.]

<PAGE>

TABLE OF CONTENTS

<S> <C>
Expense Summary ................................................................. 4

Fund Objectives ................................................................. 5

Investment Policies ............................................................. 5

Management ...................................................................... 9

How to Purchase and Redeem Shares ............................................... 10

How the Fund Values Its Shares .................................................. 11

How Distributions Are Made; Tax Information ..................................... 12

Other Information Concerning the Fund ........................................... 13

Performance Information ......................................................... 17
</TABLE>

<PAGE>

EXPENSE SUMMARY

Expenses are one of several factors to consider when investing. The following
table summarizes your costs from investing in the Fund based on estimated
expenses for the current fiscal year. The examples show the cumulative expenses
attributable to a hypothetical $1,000 investment over specified periods.

<S> <C>
Annual Fund Operating Expenses
(as a percentage of average net assets)

Investment Advisory Fee .................................... 0.40%
12b-1 Fee .................................................. None
Shareholder Servicing Fee .................................. None
Other Expenses (after reimbursements)* ..................... 0. %
-----
Total Fund Operating Expenses (after reimbursements)* ...... 0. %
=====
</TABLE>

<TABLE>
<S> <C> <C> <C> <C>
Examples
Your investment of $1,000 would incur the
following expenses, assuming 5% annual return: 1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Shares .............................................. $-- $-- $-- $--
</TABLE>

* Reflects the agreement by Chase voluntarily to reimburse certain expenses for
a period of at least one year after the date of this Prospectus. Absent such
reimbursements, Total Fund Operating Expenses for the Fund would be 0. %.

The table is provided to help you understand the expenses of investing in the
Fund and your share of the operating expenses that the Fund incurs. The examples
should not be considered representations of past or future expenses or returns;
actual expenses and returns may be greater or less than shown.

Charges or credits, not reflected in the expense table above, may be incurred
directly by customers of financial institutions in connection with an investment
in the Fund.

<PAGE>

FUND OBJECTIVES

Vista Select Growth and Income Fund seeks to provide long-term capital
appreciation and dividend income. The Fund is not intended to be a complete
investment program, and there is no assurance it will achieve its objectives.

INVESTMENT POLICIES

INVESTMENT APPROACH

The Fund seeks to achieve its objective by investing all of its investable
assets in the Portfolio. The Portfolio invests in common stocks of issuers with
a broad range of market capitalizations. Under normal market conditions, the
Portfolio will invest at least 80% of its total assets in common stocks. In
addition, the Portfolio may invest up to 20% of its total assets in convertible
securities.

The Portfolio's advisers intend to utilize both quantitative and fundamental
research to identify undervalued stocks with a catalyst for positive change. The
advisers believe that the market risk involved in seeking capital appreciation
will be moderated to an extent by the anticipated dividend returns on the stocks
in which the Portfolio invests.

The Portfolio is classified as a "non-diversified" fund under federal securities
law. The Portfolio's assets may be more concentrated in the securities of any
single issuer or group of issuers than if the Portfolio were diversified.

The Portfolio may invest any portion of its assets not invested as described
above in high quality money market instruments and repurchase agreements. For
temporary defensive purposes, the Portfolio may invest without limitation in
these instruments as well as investment grade debt securities. To the extent
that the Portfolio departs from its investment policies during temporary
defensive periods, the Fund's investment objective may not be achieved.

FUND STRUCTURE

The Portfolio has an objective identical to that of the Fund. The Fund may
withdraw its investment from the Portfolio at any time if the Trustees determine
that it is in the best interest of the Fund to do so. Upon any such withdrawal,
the Trustees would consider what action might be taken, including investing all
of the Fund's investable assets in another pooled investment entity having
substantially the same objective and policies as the Fund or retaining an
investment adviser to manage the Fund's assets directly.

OTHER INVESTMENT PRACTICES

The Portfolio may also engage in the following investment practices, when
consistent with the Portfolio's overall objective and policies. These practices,
and certain associated risks, are more fully described in the SAI.

FOREIGN SECURITIES. The Portfolio may invest up to 20% of its total assets in
foreign securities, including Depositary Receipts. Since foreign securities
are normally denominated and traded in foreign currencies, the values of the
Portfolio's foreign investments may

<PAGE>

be affected favorably or unfavorably by currency exchange rates and exchange
control regulations. There may be less information publicly available about
foreign companies than U.S. companies, and they are not generally subject to
accounting, auditing and financial reporting standards and practices comparable
to those in the U.S. The securities of foreign companies may be less liquid and
more volatile than the securities of comparable U.S. companies. Foreign
settlement procedures and trade regulations may involve certain risks (such as
delay in payment or delivery of securities or in the recovery of the Portfolio's
assets held abroad) and expenses. It is possible that nationalization or
expropriation of assets, imposition of currency exchange controls, confiscatory
taxation, political or financial instability and diplomatic developments could
affect the value of the Portfolio's investments in certain foreign countries.
Foreign laws may restrict the ability to invest in certain countries or issuers
and special tax considerations will apply to foreign securities. The risks can
increase if the Portfolio invests in securities of issuers in emerging markets.

The Portfolio may invest its assets in securities of foreign issuers in the form
of American Depositary Receipts, European Depositary Receipts, Global Depositary
Receipts or other similar securities representing securities of foreign issuers
(collectively, "Depositary Receipts"). The Portfolio treats Depositary Receipts
as interests in the underlying securities for purposes of its investment
policies. The Portfolio will limit its investment in Depositary Receipts not
sponsored by the issuer of the underlying securities to no more than 5% of the
value of its net assets (at the time of investment).

SUPRANATIONAL AND ECU OBLIGATIONS. The Portfolio may invest in securities issued
by supranational organizations, which include organizations such as The World
Bank, the European Community, the European Coal and Steel Community and the
Asian Development Bank. The Portfolio may also invest in securities denominated
in the ECU, which is a "basket" consisting of specified amounts of the
currencies of certain member states of the European Community. These securities
are typically issued by European governments and supranational organizations.

CONVERTIBLE SECURITIES. The Portfolio may invest up to 20% of its net assets in
convertible securities, which are securities generally offering fixed interest
or dividend yields which may be converted either at a stated price or stated
rate for common or preferred stock. Although to a lesser extent than with
fixed-income securities generally, the market value of convertible securities
tends to decline as interest rates increase, and increase as interest rates
decline. Because of the conversion feature, the market value of convertible
securities also tends to vary with fluctuations in the market value of the
underlying common or preferred stock.

MONEY MARKET INSTRUMENTS. The Portfolio may invest in cash or high-quality,
short-term money market instruments. Such

<PAGE>

instruments may include U.S. Government securities, commercial paper of domestic
and foreign issuers and obligations of domestic and foreign banks. Investments
in foreign money market instruments may involve certain risks associated with
foreign investment.

INVESTMENT GRADE DEBT SECURITIES. Investment grade debt securities are
securities rated in the category BBB or higher by Standard & Poor's Corporation
("S&P"), or Baa or higher by Moody's Investors Services, Inc. ("Moody's") or the
equivalent by another national rating organization, or, if unrated, determined
by the advisers to be of comparable quality.

REPURCHASE AGREEMENTS, SECURITIES LOANS AND FORWARD COMMITMENTS. The Portfolio
may enter into agreements to purchase and resell securities at an agreed-upon
price and time. The Portfolio also has the ability to lend portfolio securities
in an amount equal to not more than 30% of its total assets to generate
additional income. These transactions must be fully collateralized at all times.
The Portfolio may purchase securities for delivery at a future date, which may
increase its overall investment exposure and involves a risk of loss if the
value of the securities declines prior to the settlement date. These
transactions involve some risk to the Portfolio if the other party should
default on its obligation and the Portfolio is delayed or prevented from
recovering the collateral or completing the transaction.

BORROWINGS AND REVERSE REPURCHASE AGREEMENTS. The Portfolio may borrow money
from banks for temporary or short-term purposes, but will not borrow for
leveraging purposes. The Portfolio may also sell and simultaneously commit to
repurchase a portfolio security at an agreed-upon price and time, to avoid
selling securities during unfavorable market conditions in order to meet
redemptions. Whenever the Portfolio enters into a reverse repurchase agreement,
it will establish a segregated account in which it will maintain liquid assets
on a daily basis in an amount at least equal to the repurchase price (including
accrued interest). The Portfolio would be required to pay interest on amounts
obtained through reverse repurchase agreements, which are considered borrowings
under federal securities laws.

STAND-BY COMMITMENTS. The Portfolio may enter into put transactions, including
transactions sometimes referred to as stand-by commitments, with respect to
securities in its portfolio. In these transactions, the Portfolio would acquire
the right to sell a security at an agreed upon price within a specified period
prior to its maturity date. These transactions involve some risk to the
Portfolio if the other party should default on its obligation and the Portfolio
is delayed or prevented from recovering the collateral or completing the
transaction. Acquisition of puts will have the effect of increasing the cost of
the

7
<PAGE>

securities subject to the put and thereby reducing the yields otherwise
available from such securities.

OTHER INVESTMENT COMPANIES. The Portfolio may invest up to 10% of its total
assets in shares of other investment companies when consistent with its
investment objective and policies, subject to applicable regulatory limitations.
Additional fees may be charged by other investment companies.

STRIPS. The Portfolio may invest up to 20% of its total assets in separately
traded principal and interest components of securities backed by the full faith
and credit of the U.S. Government, including instruments known as "STRIPS". The
value of these instruments tends to fluctuate more in response to changes in
interest rates than the value of ordinary interest-paying debt securities with
similar maturities. The risk is greater when the period to maturity is longer.

DERIVATIVES AND RELATED INSTRUMENTS. The Portfolio may invest its assets in
derivative and related instruments to hedge various market risks or to increase
the Portfolio's income or gain. Some of these instruments will be subject to
asset segregation requirements to cover the Portfolio's obligations. The
Portfolio may (i) purchase, write and exercise call and put options on
securities and securities indexes (including using options in combination with
securities, other options or derivative instruments); (ii) enter into swaps,
futures contracts and options on futures contracts; (iii) employ forward
currency contracts; and (iv) purchase and sell structured products, which are
instruments designed to restructure or reflect the characteristics of certain
other investments.

There are a number of risks associated with the use of derivatives and related
instruments and no assurance can be given that any strategy will succeed. The
value of certain derivatives or related instruments in which the Portfolio
invests may be particularly sensitive to changes in prevailing economic
conditions and market value. The ability of the Portfolio to successfully
utilize these instruments may depend in part upon the ability of the Portfolio's
advisers to forecast these factors correctly. Inaccurate forecasts could expose
the Portfolio to a risk of loss. There can be no guarantee that there will be a
correlation between price movements in a hedging instrument and in the portfolio
assets being hedged. The Portfolio is not required to use any hedging
strategies. Hedging strategies, while reducing risk of loss, can also reduce the
opportunity for gain. Derivatives transactions not involving hedging may have
speculative characteristics, involve leverage and result in more risk to the
Portfolio than hedging strategies using the same instruments. There can be no
assurance that a liquid market will exist at a time when the Portfolio seeks to
close out a derivatives position. Activities of large traders in the futures and
securities markets involving arbitrage, "program trading," and other investment
strategies may cause price distortions in derivatives markets. In certain
instances, particularly those involving over-

<PAGE>

the-counter transactions or forward contracts, there is a greater potential that
a counterparty or broker may default. In the event of a default, the Portfolio
may experience a loss. For additional information concerning derivatives,
related instruments and the associated risks, see the SAI.

PORTFOLIO TURNOVER. The frequency of the Portfolio's portfolio transactions will
vary from year to year. The Portfolio's investment policies may lead to frequent
changes in investments, particularly in periods of rapidly changing market
conditions. High portfolio turnover rates would generally result in higher
transaction costs, including brokerage commissions or dealer mark-ups, and would
make it more difficult for the Portfolio to qualify as a registered investment
company under federal tax law. See "How Distributions are Made; Tax Information"
and "Other Information Concerning the Fund--Certain Regulatory Matters."

LIMITING INVESTMENT RISKS

Specific investment restrictions help the Portfolio limit investment risks for
the Fund's shareholders. These restrictions prohibit the Portfolio from: (a)
investing more than 15% of its net assets in illiquid securities (which include
securities restricted as to resale unless they are determined to be readily
marketable in accordance with procedures established by the Board of Trustees);
or (b) investing more than 25% of its total assets in any one industry. A
complete description of these and other investment policies is included in the
SAI. Except for restriction (b) above and investment policies designated as
fundamental in the SAI, the investment policies (including their investment
objective) of the Portfolio and the Fund are not fundamental. Shareholder
approval is not required to change any non-fundamental investment policy.
However, in the event of a change in the Fund's or Portfolio's investment
objective, shareholders will be given at least 30 days prior written notice.

RISK FACTORS

The net asset value of the shares of the Fund can be expected to fluctuate based
on the value of the securities held by the Portfolio. The Fund does not
constitute a balanced or complete investment program. The Fund is subject to the
general risks and considerations associated with equity investing.

Because the Portfolio is "non-diversified," the value of the Fund's shares is
more susceptible to developments affecting issuers in which the Portfolio
invests.

For a discussion of certain other risks associated with the Portfolio's
additional investment activities, see "Other Investment Practices" above.

MANAGEMENT

THE PORTFOLIO'S ADVISERS

The Chase Manhattan Bank ("Chase") acts as investment adviser to the Portfolio
pursuant to an Investment Advisory Agreement and has overall responsibility for
investment decisions of the Portfolio, subject to the oversight of the Board of
Trustees. Chase is a wholly-owned subsidiary of The

9
<PAGE>

Chase Manhattan Corporation, a bank holding company. Chase and its predecessors
have over 100 years of money management experience. For its investment advisory
services to the Portfolio, Chase is entitled to receive an annual fee computed
daily and paid monthly based at an annual rate equal to 0.40% of the Portfolio's
average daily net assets. Chase is located at 270 Park Avenue, New York, New
York 10017.

Chase Asset Management, Inc. ("CAM"), a registered investment adviser, is the
sub-investment adviser to the Portfolio pursuant to a Sub-Investment Advisory
Agreement between CAM and Chase. CAM is a wholly-owned operating subsidiary of
Chase. CAM makes investment decisions for the Portfolio on a day-to-day basis.
For these services, CAM is entitled to receive a fee, payable by Chase from its
advisory fee, at an annual rate equal to 0.20% of the Portfolio's average daily
net assets. CAM was recently formed for the purpose of providing discretionary
investment advisory services to institutional clients and to consolidate Chase's
investment management function. The same individuals who serve as portfolio
managers for Chase also serve as portfolio managers for CAM. CAM is located at
1211 Avenue of the Americas, New York, New York 10036.

PORTFOLIO MANAGERS. Dave Klassen, Director of Domestic Equity Management at
Chase, and Greg Adams, Director of U.S. Equity Research at Chase, have been
responsible for the day-to-day management of the Portfolio since March 1995.
Mr. Klassen joined Chase in March 1992 and, in addition to managing the Vista
Growth and Income Portfolio, is a manager of the Vista Small Cap Equity Fund
and the Vista Capital Growth Portfolio. Prior to joining Chase, Mr. Klassen
was a vice president and portfolio manager at Dean Witter Reynolds,
responsible for managing several mutual funds and other accounts. Mr. Adams
joined Chase in 1987 and is also a manager of the Vista Balanced Fund and the
Vista Large Cap Equity Fund. In addition, Mr. Adams has been responsible for
overseeing the proprietary computer model program used in the U.S. equity
selection process.

HOW TO PURCHASE AND REDEEM SHARES

HOW TO PURCHASE SHARES

Shares of the Fund may be purchased through Chase and other selected financial
institutions that have entered into an agreement with the Fund (such
institutions are referred to herein as "Financial Institutions") on each
business day during which Chase and the New York Stock Exchange are open ("Fund
Business Day"). Qualified investors are defined as institutions, trusts,
partnerships, corporations, qualified and other retirement plans and fiduciary
accounts. The Fund reserves the right to reject any purchase order or cease
offering shares for purchase at any time.

Shares are sold at their public offering price, which is their next determined
net asset value. Orders received by the account administrator at your Financial
Institution in proper form prior to

<PAGE>

the New York Stock Exchange closing time (or such earlier cut-off time as may be
established by your Financial Institution) are confirmed at that day's net asset
value, provided the order is received by the Fund prior to its close of
business. Financial Institutions are responsible for forwarding orders for the
purchase of shares on a timely basis. Shares will be maintained in book entry
form and share certificates will not be issued. Management reserves the right to
refuse to sell shares of the Fund to any institution.

Federal regulations require that each investor provide a certified Taxpayer
Identification Number upon opening an account.

MINIMUM INVESTMENTS

Financial Institutions are required to maintain at least $5,000,000 in an
omnibus account with one or more of the Vista Select Funds.

HOW TO REDEEM SHARES

You may redeem all or any portion of the shares in your account at any time at
the net asset value next determined after a redemption request in proper form is
furnished by you to the account administrator at your Financial Institution and
transmitted to and received by the Fund.

In making redemption requests, the names of the registered shareholders on your
account and your account number must be supplied. The price you will receive is
the next net asset value calculated after the Fund receives your request in
proper form. In order to receive that day's net asset value, the Fund must
receive your request before the close of regular trading on the New York Stock
Exchange. Your Financial Institution will be responsible for furnishing all
necessary documentation to the Fund, and may charge you for its services.

The Fund generally sends your Financial Institution payment for your shares in
federal funds on the business day after your request is received in proper form.
Under unusual circumstances, the Fund may suspend redemptions, or postpone
payment for more than seven days, as permitted by federal securities law.

If a Financial Institution is authorized to act upon redemption and transfer
instructions received by telephone from an investor and the Financial
Institution fails to employ reasonable procedures to confirm that instructions
communicated by telephone are genuine, it may be liable for any losses due to
unauthorized or fraudulent instructions. An investor agrees, however, that to
the extent permitted by applicable law, neither the Fund nor the investor's
Financial Institution nor any of their agents will be liable for any loss,
liability, cost or expense arising out of any redemption request, including any
fraudulent or unauthorized request. For information, consult your account
administrator.

HOW THE FUND
VALUES ITS SHARES

The net asset value of the Fund's shares is determined once daily based upon
prices determined as of the close of regular trading on the New York Stock
Exchange (normally 4:00 p.m.,

<PAGE>

Eastern time, however, options are priced at 4:15 p.m., Eastern time), on each
Fund Business Day, by dividing the net assets of a Fund by the total number of
outstanding shares of the Fund. Values of assets held by the Fund are determined
on the basis of their market or other fair value, as described in the SAI.

HOW DISTRIBUTIONS ARE MADE; TAX INFORMATION

The Fund distributes any net investment income other than short term capital
gains at least quarterly. The Fund distributes any net realized short term and
long term capital gains at least annually. Distributions from capital gains are
made after applying any available capital loss carryovers.

You can choose from three distribution options if made available by your
Financial Institution: (1) reinvest all distributions in additional Fund shares;
(2) receive distributions from net investment income in cash while reinvesting
capital gains distributions in additional shares; or (3) receive all
distributions in cash. You can change your distribution option by notifying your
account administrator in writing. If your Financial Institution does not offer
distribution reinvestment or if you do not select an option when you open your
account, all distributions will be made in cash.

The Fund intends to qualify as a "regulated investment company" for federal
income tax purposes and to meet all other requirements that are necessary for it
to be relieved of federal taxes on income and gains it distributes to
shareholders. The Fund intends to distribute substantially all of its ordinary
income and capital gain net income on a current basis. If the Fund does not
qualify as a regulated investment company for any taxable year or does not make
such distributions, the Fund will be subject to tax on all of its income and
gains.

All Fund distributions will be taxable to you as ordinary income, except that
any distributions of net long-term capital gains will be taxable as such,
regardless of how long you have held the shares. Distributions will be taxable
as described above whether received in cash or in shares through the
reinvestment of distributions.

A portion of the ordinary income dividends paid by the Fund may qualify for the
70% dividends-received deduction for corporate shareholders.

Investors should be careful to consider the tax implications of purchasing
shares just prior to the next distribution date. Those investors purchasing
shares just prior to a distribution will be taxed on the entire amount of the
distribution received, even though the net asset value per share on the date of
such purchase reflected the amount of such distribution.

Early in each calendar year the Fund will notify your Financial Institution of
the amount and tax status of distributions paid for the preceding year.

The foregoing is a summary of certain federal income tax consequences of
investing in the Fund. You should consult your tax adviser to determine the
precise

<PAGE>

effect of an investment in the Fund on your particular tax situation
(including possible liability for state and local taxes and, for foreign
shareholders, U.S. withholding taxes).

OTHER INFORMATION
CONCERNING THE FUND

Your Financial Institution may offer additional services to its customers,
including specialized procedures for the purchase and redemption of Fund shares,
such as pre-authorized or systematic purchase and redemption plans. Each
Financial Institution may establish its own terms and conditions, including
limitations on the amounts of subsequent transactions, with respect to such
services. Certain Financial Institutions may (although they are not required by
the Trust to do so) credit to the accounts of their customers from whom they are
already receiving other fees an amount not exceeding such other fees.

ADMINISTRATOR

Chase acts as the Fund's administrator and is entitled to receive a fee computed
daily and paid monthly at an annual rate equal to 0.10% of the Fund's average
daily net assets.

SUB-ADMINISTRATOR
AND DISTRIBUTOR

Vista Fund Distributors, Inc. ("VFD") acts as the Fund's sub-administrator and
distributor. VFD is a subsidiary of The BISYS Group, Inc. and is unaffiliated
with Chase. For the sub-administrative services it performs, VFD is entitled to
receive a fee from the Fund at an annual rate equal to 0.05% of the Fund's
average daily net assets. VFD has agreed to use a portion of this fee to pay for
certain expenses incurred in connection with organizing new series of the Trust
and certain other ongoing expenses of the Trust. VFD is located at 101 Park
Avenue, New York, New York 10178.

CUSTODIAN

Chase acts as custodian for the Fund and receives compensation under an
agreement with the Trust. Chase may sub-contract for the provision of certain
services to be provided under the custody agreement. Fund securities and cash
may be held by sub-custodian banks if such arrangements are reviewed and
approved by the Trustees.

EXPENSES

The Fund pays the expenses incurred in its operations, including its pro rata
share of expenses of the Trust. These expenses include investment advisory and
administrative fees; the compensation of the Trustees; registration fees;
interest charges; taxes; expenses connected with the execution, recording and
settlement of security transactions; fees and expenses of the Fund's custodian
for all services to the Fund, including safekeeping of funds and securities and
maintaining required books and accounts; expenses of preparing and mailing
reports to investors and to government offices and commissions; expenses of
meetings of investors; fees and expenses of independent accountants, of legal
counsel and of any transfer agent, registrar or dividend disbursing

13
<PAGE>

agent of the Trust; insurance premiums; and expenses of calculating the net
asset value of, and the net income on, shares of the Fund. In addition, the Fund
may allocate transfer agency and certain other expenses by class if additional
classes of the Fund are established in the future. Service providers to the Fund
may, from time to time, voluntarily waive all or a portion of any fees to which
they are entitled.

ORGANIZATION AND DESCRIPTION OF SHARES

The Fund is a portfolio of Mutual Fund Group, an open-end management investment
company organized as a Massachusetts business trust in 1987 (the "Trust"). The
Trust has reserved the right to create and issue additional series and classes.
Each share of a series or class represents an equal proportionate interest in
that series or class with each other share of that series or class. The shares
of each series or class participate equally in the earnings, dividends and
assets of the particular series or class. Shares have no preemptive or
conversion rights. Shares when issued are fully paid and non-assessable, except
as set forth below. Shareholders are entitled to one vote for each whole share
held, and each fractional share shall be entitled to a proportionate fractional
vote, except that Trust shares held in the treasury of the Trust shall not be
voted.

The Fund currently issues a single class of shares but may, in the future, offer
other classes of shares. The categories of investors that are eligible to
purchase shares may differ for each class of Fund shares. In addition, other
classes of Fund shares may be subject to differences in sales charge
arrangements, ongoing distribution and service fee levels, and levels of certain
other expenses, which will affect the relative performance of the different
classes. Investors may call 1-800-622-4273 to obtain additional information
about other classes of shares of the Fund that may be offered in the future. Any
person entitled to receive compensation for selling or servicing shares of the
Fund may receive different levels of compensation with respect to one class of
shares over another. Shares of each class of the Fund would generally vote
together except when required under federal securities laws to vote separately
on matters that only affect a particular class, such as the approval of
distribution plans for a particular class.

The business and affairs of the Trust are managed under the general direction
and supervision of the Trust's Board of Trustees. The Trust is not required to
hold annual meetings of shareholders but will hold special meetings of
shareholders of all series or classes when in the judgment of the Trustees it is
necessary or desirable to submit matters for a shareholder vote. The Trustees
will promptly call a meeting of shareholders to remove a trustee(s) when
requested to do so in writing by record holders of not less than 10% of all
outstanding shares of the Trust.

Under Massachusetts law, shareholders of such a business trust may, under
certain circumstances, be held personally liable as partners for its
obligations. However, the risk of a shareholder incurring financial loss on
account of shareholder

<PAGE>

liability is limited to circumstances in which both inadequate insurance existed
and the Trust itself was unable to meet its obligations.

UNIQUE CHARACTERISTICS OF
MASTER/FEEDER FUND STRUCTURE

Unlike other mutual funds which directly acquire and manage their own portfolio
securities, the Fund invests all of its investable assets in the Portfolio, a
separate registered investment company. Therefore, a shareholder's interest in
the Portfolio's securities is indirect. In addition to selling a beneficial
interest to the Fund, the Portfolio may sell beneficial interests to other
mutual funds or institutional investors. Such investors will invest in the
Portfolio on the same terms and conditions and will pay a proportionate share of
the Portfolio's expenses. However, other investors investing in the Portfolio
are not required to sell their shares at the same public offering prices as the
Fund, and may bear different levels of ongoing expenses than the Fund.
Shareholders of the Fund should be aware that these differences may result in
differences in returns experienced in the different funds that invest in the
Portfolio. Such differences in returns are also present in other mutual fund
structures.

Smaller funds investing in the Portfolio may be materially affected by the
actions of larger funds investing in the Portfolio. For example, if a large fund
withdraws from the Portfolio, the remaining funds may experience higher pro rata
operating expenses, thereby producing lower returns. Additionally, the Portfolio
may become less diverse, resulting in increased portfolio risk. However, this
possibility also exists for traditionally structured funds which have large or
institutional investors. Funds with a greater pro rata ownership in the
Portfolio could have effective voting control of the operations of the
Portfolio. Whenever the Trust is requested to vote on matters pertaining to the
Portfolio, the Trust will hold a meeting of shareholders of the Fund and will
cast all of its votes in the same proportion as do the Fund's shareholders.
Shares of the Fund for which no voting instructions have been received will be
voted in the same proportion as those shares for which voting instructions are
received. Certain changes in the Portfolio's objective, policies or restrictions
may require the Trust to withdraw the Fund's interest in the Portfolio. Any
withdrawal could result in a distribution in kind of portfolio securities (as
opposed to a cash distribution from the Portfolio). The Fund could incur
brokerage fees or other transaction costs in converting such securities to cash.
In addition, a distribution in kind may result in a less diversified portfolio
of investments or adversely affect the liquidity of the Fund.

State securities regulations generally do not permit the same individuals who
are disinterested Trustees of the Trust to be Trustees of the Portfolio absent
the adoption of written procedures by a majority of the disinterested Trustees
of the Trust reasonably appropriate to deal with potential conflicts of interest
up to and including creating a separate Board of Trustees. The Trustees of the
Trust, including a majority of

15
<PAGE>

the disinterested Trustees, have adopted procedures they believe are reasonably
appropriate to deal with any conflict of interest up to and including creating a
separate Board of Trustees.

Investors in the Fund may obtain information about whether an investment in the
Portfolio may be available through other funds by calling the Fund at
1-800-622-4273.

CERTAIN REGULATORY MATTERS

Banking laws, including the Glass-Steagall Act as currently interpreted,
prohibit bank holding companies and their affiliates from sponsoring,
organizing, controlling, or distributing shares of mutual funds, and generally
prohibit banks from issuing, underwriting, selling or distributing securities.
These laws do not prohibit banks or their affiliates from acting as investment
adviser, administrator or custodian to mutual funds or from purchasing mutual
fund shares as agent for a customer. Chase and the Trust believe that Chase
(including its affiliates) may perform the services to be performed by it as
described in this Prospectus without violating such laws. If future changes in
these laws or interpretations required Chase to alter or discontinue any of
these services, it is expected that the Board of Trustees would recommend
alternative arrangements and that investors would not suffer adverse financial
consequences. State securities laws may differ from the interpretations of
banking law described above and banks may be required to register as dealers
pursuant to state law.

Chase and its affiliates may have deposit, loan and other commercial banking
relationships with the issuers of securities purchased on behalf of the Fund,
including outstanding loans to such issuers which may be repaid in whole or in
part with the proceeds of securities so purchased. Chase and its affiliates
deal, trade and invest for their own accounts in U.S. Government obligations,
municipal obligations and commercial paper and are among the leading dealers of
various types of U.S. Government obligations and municipal obligations. Chase
and its affiliates may sell U.S. Government obligations and municipal
obligations to, and purchase them from, other investment companies sponsored by
the Fund's distributor or affiliates of the distributor. Chase will not invest
the Fund's assets in any U.S. Government obligations, municipal obligations or
commercial paper purchased from itself or any affiliate, although under certain
circumstances such securities may be purchased from other members of an
underwriting syndicate in which Chase or an affiliate is a non-principal member.
This restriction may limit the amount or type of U.S. Government obligations,
municipal obligations or commercial paper available to be purchased by the Fund.
Chase has informed the Fund that in making its investment decisions, it does not
obtain or use material inside information in the possession of any other
division or department of Chase, including the division that performs services
for the Fund as custodian, or in the possession of any affiliate of Chase.
Shareholders of the Fund should be aware that, subject to applicable legal or
regulatory restrictions, Chase and

16
<PAGE>

its affiliates may exchange among themselves certain information about the
shareholder and his account. Transactions with affiliated broker- dealers will
only be executed on an agency basis in accordance with applicable federal
regulations.

PERFORMANCE INFORMATION

The Fund's investment performance may from time to time be included in
advertisements about the Fund. Performance is calculated separately for each
class of shares. "Yield" for each class of shares is calculated by dividing the
annualized net investment income per share during a recent 30-day period by the
maximum public offering price per share of such class on the last day of that
period.

"Total return" for the one-, five- and ten-year periods (or for the life of a
class, if shorter) through the most recent calendar quarter represents the
average annual compounded rate of return on an investment of $1,000 in the Fund
invested at the public offering price. Total return may also be presented for
other periods.

All performance data is based on the Fund's past investment results and does not
predict future performance. The performance data for the Fund prior to its
commencement of operations includes the historical performance of the Portfolio.
Investment performance, which will vary, is based on many factors, including
market conditions, the composition of the Fund's portfolio and the Fund's
operating expenses. Investment performance also often reflects the risks
associated with the Fund's investment objectives and policies. These factors
should be considered when comparing the Fund's investment results to those of
other mutual funds and other investment vehicles. Quotation of investment
performance for any period when a fee waiver or expense limitation was in effect
will be greater than if the waiver or limitation had not been in effect. The
Fund's performance may be compared to other mutual funds, relevant indices and
rankings prepared by independent services. See the SAI.

<PAGE>

(This Page Intentially Left Blank)

<PAGE>

(This Page Intentially Left Blank)

<PAGE>

TRANSFER AGENT AND DIVIDEND PAYING AGENT

DST Systems, Inc.
210 West 10th Street
Kansas City, MO 64105

LEGAL COUNSEL

Simpson Thacher & Bartlett
425 Lexington Avenue

New York, NY 10017

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP
1177 Avenue of the Americas

New York, NY 10036

(VISTA LOGO)

101 Park Avenue
New York, NY 10178

VGI-1-796CX

<PAGE>

STATEMENT OF
ADDITIONAL INFORMATION
______________________, 1996

VISTA[SM] SELECT GROWTH AND INCOME FUND
101 Park Avenue, New York, New York 10178

This Statement of Additional Information sets forth information which may be of
interest to investors but which is not necessarily included in the Prospectus
offering shares of the Fund. This Statement of Additional Information should be
read in conjunction with the Prospectus offering shares of Vista Select Growth
and Income Fund (the "Fund"). Any references to a "Prospectus" in this Statement
of Additional Information is a reference to the foregoing Prospectus, as the
context requires. Copies of the Prospectus may be obtained by an investor
without charge by contacting Vista Fund Distributors, Inc.("VFD"), the Fund's
distributor (the "Distributor"), at the above-listed address. This Statement of
Additional Information is NOT a prospectus and is authorized for distribution to
prospective investors only if preceded or accompanied by an effective
prospectus.

For more information about the Fund, simply call or write the Vista Select
Service Center at:

1-800-622-4273
Vista Select Service Center
P.O. Box 419392
Kansas City, MO 64141
MFG-SAI

<PAGE>

Table of Contents Page

The Fund ................................................................. 3
Investment Policies and Restrictions ..................................... 3
Performance Information .................................................. 16
Determination of Net Asset Value ......................................... 20
Purchases and Redemptions ................................................ 21
Tax Matters .............................................................. 22
Management of the Trust and the Fund or Portfolio ........................ 26
Independent Accountants .................................................. 37
General Information ...................................................... 37
Appendix A--Description of Certain Obligations Issued or
Guaranteed by U.S. Government Agencies or Instrumentalities ............. A-1
Appendix B--Description of Ratings ....................................... B-1

2
<PAGE>
THE FUND

Mutual Fund Group (the "Trust") is an open-end management investment company
which was organized as a business trust under the laws of the Commonwealth of
Massachusetts on May 11, 1987. The Trust presently consists of 18 separate
series, including Vista Select Growth and Income Fund (the "Fund"). The Fund is
non-diversified, as such term is defined in the Investment Company Act of 1940,
as amended (the "1940 Act"). The shares of the Fund are collectively referred to
in this Statement of Additional Information as the "Shares."

The Vista Select Growth and Income Fund will operate with a master fund/feeder
fund structure. Under this structure, the Fund seeks to achieve its investment
objective by investing all of its investable assets in an open-end management
investment company which has the same investment objective as the Fund. The
Vista Select Growth and Income Fund invests in the Growth and Income Portfolio
(the "Portfolio"). The Portfolio is a New York trust with its principal office
in New York. Certain qualified investors, in addition to the Fund, may invest in
the Portfolio. For purposes of this Statement of Additional Information, any
information or references to the Portfolio refer to the operations and
activities after implementation of the master fund/feeder fund structure.

The Board of Trustees of the Trust provides broad supervision over the affairs
of the Trust including the Fund. In the case of the Portfolio, a separate Board
of Trustees, with the same members as the Board of Trustees of the Trust,
provides broad supervision. The Chase Manhattan Bank ("Chase") is the investment
adviser for the Portfolio. Chase also serves as the Trust's administrator (the
"Administrator") and supervises the overall administration of the Trust,
including the Fund, and is the administrator of the Portfolio. A majority of the
Trustees of the Trust are not affiliated with the investment adviser or
sub-advisers. Similarly, a majority of the Trustees of the Portfolio are not
affiliated with the investment adviser or sub-adviser.

INVESTMENT POLICIES AND RESTRICTIONS

Investment Policies

The Prospectus sets forth the various investment policies of the Fund and
Portfolio. The following information supplements and should be read in
conjunction with the related sections of the Prospectus. For descriptions of the
securities ratings of Moody's Investors Service, Inc. ("Moody's"), Standard &
Poor's Corporation ("S&P") and Fitch Investors Service, Inc. ("Fitch"), see
Appendix B.

U.S. Government Securities. U.S. Government Securities include (1) U.S. Treasury
obligations, which generally differ only in their interest rates, maturities and
times of issuance, including: U.S. Treasury bills (maturities of one year or
less), U.S. Treasury notes (maturities of one to ten years) and U.S. Treasury
bonds (generally maturities of greater than ten years); and (2) obligations
issued or guaranteed by U.S. Government agencies and instrumentalities which are
supported by any of the following: (a) the full faith and credit of the U.S.
Treasury, (b) the right of the issuer to borrow any amount listed to a specific
line of credit from the U.S. Treasury, (c) discretionary authority of the U.S.
Government to purchase certain obligations of the U.S. Government agency or
instrumentality or (d) the credit of the agency or instrumentality. Agencies and
instrumentalities of the U.S. Government include but are not limited to: Federal
Land Banks, Federal Financing Banks, Banks for Cooperatives, Federal
Intermediate Credit Banks, Farm Credit Banks, Federal Home Loan Banks, Federal
Home Loan Mortgage Corporation, Federal National Mortgage Association, Student
Loan Marketing Association, United States Postal Service, Chrysler Corporate
Loan Guarantee Board, Small Business Administration, Tennessee Valley Authority
and any other enterprise established or sponsored by the U.S. Government.
Certain U.S. Government Securities, including U.S. Treasury bills, notes and
bonds, Government National Mortgage Association certificates and Federal Housing
Administration debentures, are supported by the full faith and credit of the
United States. Other U.S. Government Securities

3
<PAGE>
are issued or guaranteed by federal agencies or government sponsored enterprises
and are not supported by the full faith and credit of the United States. These
securities include obligations that are supported by the right of the issuer to
borrow from the U.S. Treasury, such as obligations of the Federal Home Loan
Banks, and obligations that are supported by the creditworthiness of he
particular instrumentality, such as obligations of the Federal National Mortgage
Association or Federal Home Loan Mortgage Corporation. For a description of
certain obligations issued or guaranteed by U.S. Government agencies and
instrumentalities, see Appendix A.

In addition, certain U.S. Government agencies and instrumentalities issue
specialized types of securities, such as guaranteed notes of the Small Business
Administration, Federal Aviation Administration, Department of Defense, Bureau
of Indian Affairs and Private Export Funding Corporation, which often provide
higher yields than are available from the more common types of government-backed
instruments. However, such specialized instruments may only be available from a
few sources, in limited amounts, or only in very large denominations; they may
also require specialized capability in portfolio servicing and in legal matters
related to government guarantees. While they may frequently offer attractive
yields, the limited-activity markets of many of these securities means that, if
the Fund or Portfolio were required to liquidate any of them, it might not be
able to do so advantageously; accordingly, the Fund and Portfolio normally hold
such securities to maturity or pursuant to repurchase agreements, and would
treat such securities (including repurchase agreements maturing in more than
seven days) as illiquid for purposes of its limitation on investment in illiquid
securities.

Bank Obligations. Investments in bank obligations are limited to those of U.S.
banks (including their foreign branches) which have total assets at the time of
purchase in excess of $1 billion and the deposits of which are insured by either
the Bank Insurance Fund or the Savings Association Insurance Fund of the Federal
Deposit Insurance Corporation, and foreign banks (including their U.S. branches)
having total assets in excess of $10 billion (or the equivalent in other
currencies), and such other U.S. and foreign commercial banks which are judged
by the advisers to meet comparable credit standing criteria.

Bank obligations include negotiable certificates of deposit, bankers'
acceptances, fixed time deposits and deposit notes. A certificate of deposit is
a short-term negotiable certificate issued by a commercial bank against funds
deposited in the bank and is either interest-bearing or purchased on a discount
basis. A bankers' acceptance is a short-term draft drawn on a commercial bank by
a borrower, usually in connection with an international commercial transaction.
The borrower is liable for payment as is the bank, which unconditionally
guarantees to pay the draft at its face amount on the maturity date. Fixed time
deposits are obligations of branches of United States banks or foreign banks
which are payable at a stated maturity date and bear a fixed rate of interest.
Although fixed time deposits do not have a market, there are no contractual
restrictions on the right to transfer a beneficial interest in the deposit to a
third party. Fixed time deposits subject to withdrawal penalties and with
respect to which the Fund or Portfolio cannot realize the proceeds thereon
within seven days are deemed "illiquid" for the purposes of its restriction on
investments in illiquid securities. Deposit notes are notes issued by commercial
banks which generally bear fixed rates of interest and typically have original
maturities ranging from eighteen months to five years.

Banks are subject to extensive governmental regulations that may limit both the
amounts and types of loans and other financial commitments that may be made and
the interest rates and fees that may be charged. The profitability of this
industry is largely dependent upon the availability and cost of capital funds
for the purpose of financing lending operations under prevailing money market
conditions. Also, general economic conditions play an important part in the
operations of this industry and exposure to credit losses arising from possible
financial difficulties of borrowers might affect a bank's ability to meet its
obligations. Bank obligations may be general obligations of the parent bank or
may be limited to the issuing branch by the terms of the specific obligations or
by government regulation. Investors should also be aware that securities of
foreign banks and foreign branches of United States banks may involve foreign
investment risks in addition to those relating to domestic bank obligations.

Depositary Receipts. The Fund or Portfolio will limit its investment in
Depositary Receipts not sponsored by the issuer of the underlying security to no
more than 5% of the value of its net assets (at the time of investment). A
purchaser of an unsponsored Depositary Receipt may not have unlimited voting
rights and may not receive as much information about the issuer of the
underlying securities as with a sponsored Depositary Receipt.

ECU Obligations. The specific amounts of currencies comprising the ECU may be
adjusted by the Council of Ministers of the European Community to reflect
changes in relative values of the underlying currencies. The Trustees do not
believe that such adjustments will adversely affect holders of ECU-denominated
securities or the marketability of such securities.

Supranational Obligations. Supranational organizations, include organizations
such as The World Bank, which was chartered to finance development projects in
developing member countries; the European Community, which is a twelve-nation
organization engaged in cooperative economic activities; the European Coal and
Steel Community, which is an economic union of various European nations steel
and coal industries; and the Asian Development Bank, which is an international
development bank established to lend funds, promote investment and provide
technical assistance to member nations of the Asian and Pacific regions.

Corporate Reorganizations. In general, securities that are the subject of a
tender or exchange offer or proposal sell at a premium to their historic market
price immediately prior to the announcement of the offer or proposal. The
increased market price of these securities may also discount what the stated or
appraised value of the security would be if the contemplated action were
approved or consummated. These investments may be advantageous when the discount
significantly overstates the risk of the contingencies involved; significantly
undervalues the securities, assets or cash to be received by shareholders of the
prospective portfolio company as

4
<PAGE>

a result of the contemplated transaction; or fails adequately to recognize the
possibility that the offer or proposal may be replaced or superseded by an offer
or proposal of greater value. The evaluation of these contingencies requires
unusually broad knowledge and experience on the part of the advisers that must
appraise not only the value of the issuer and its component businesses as well
as the assets or securities to be received as a result of the contemplated
transaction, but also the financial resources and business motivation of the
offeror as well as the dynamics of the business climate when the offer or
proposal is in progress. Investments in reorganization securities may tend to
increase the turnover ratio of the Fund or Portfolio and increase its brokerage
and other transaction expenses.

Warrants And Rights. Warrants basically are options to purchase equity
securities at a specified price for a specific period of time. Their prices do
not necessarily move parallel to the prices of the underlying securities. Rights
are similar to warrants but normally have a shorter duration and are distributed
directly by the issuer to shareholders. Rights and warrants have no voting
rights, receive no dividends and have no rights with respect to the assets of
the issuer.

Commercial Paper. Commercial paper consists of short-term (usually from 1 to 270
days) unsecured promissory notes issued by corporations in order to finance
their current operations. A variable amount master demand note (which is a type
of commercial paper) represents a direct borrowing arrangement involving
periodically fluctuating rates of interest under a letter agreement between a
commercial paper issuer and an institutional lender pursuant to which the lender
may determine to invest varying amounts.

Repurchase Agreements. The Fund or Portfolio will enter into repurchase
agreements only with member banks of the Federal Reserve System and securities
dealers believed creditworthy, and only if fully collateralized by securities in
which the Fund or Portfolio are permitted to invest. Under the terms of a
typical repurchase agreement, the Fund or Portfolio would acquire an underlying
instrument for a relatively short period (usually not more than one week)
subject to an obligation of the seller to repurchase the instrument and the Fund
or Portfolio to resell the instrument at a fixed price and time, thereby
determining the yield during the Fund's or Portfolio's holding period. This
procedure results in a fixed rate of return insulated from market fluctuations
during such period. A repurchase agreement is subject to the risk that the
seller may fail to repurchase the security. Repurchase agreements are considered
under the 1940 Act to be loans collateralized by the underlying securities. All
repurchase agreements entered into by the Fund or Portfolio will be fully
collateralized at all times during the period of the agreement in that the value
of the underlying security will be at least equal to 102% of the amount of the
loan, including the accrued interest thereon, and the Fund or Portfolio or its
custodian or sub-custodian will have possession of the collateral, which the
Board of Trustees believes will give it a valid, perfected security interest in
the collateral. Whether a repurchase agreement is the purchase and sale of a
security or a collateralized loan has not been conclusively established. This
might become an issue in the event of the bankruptcy of the other party to the
transaction. In the event of default by the seller under a repurchase agreement
construed to be a collateralized loan, the underlying securities would not be
owned by the Fund or Portfolio, but would only constitute collateral for the
seller's obligation to pay the repurchase price. Therefore, the Fund or
Portfolio may suffer time delays and incur costs in connection with the
disposition of the collateral. The Board of Trustees believes that the
collateral underlying repurchase agreements may be more susceptible to claims of
the seller's creditors than would be the case with securities owned by the Fund
or Portfolio. Repurchase agreements maturing in more than seven days are treated
as illiquid for purposes of the Fund's and Portfolio's restrictions on purchases
of illiquid securities. Repurchase agreements are also subject to the risks
described below with respect to stand-by commitments.

Forward Commitments. In order to invest the Fund's and Portfolio's assets
immediately, while awaiting delivery of securities purchased on a forward
commitment basis, short-term obligations that offer same-day settlement and
earnings will normally be purchased. When a commitment to purchase a security on
a forward commitment basis is made, procedures are established consistent with
the General Statement of Policy of the Securities and Exchange Commission
concerning such purchases. Since that policy currently recommends that an amount
of the Fund's or Portfolio's assets equal to the amount of the purchase be held
aside or segregated to be used to pay for the commitment, a separate account of
the Fund or Portfolio consisting of cash, cash equivalents or high quality debt
securities equal to the amount of the Fund's or Portfolio's commitments
securities will be established at the Fund's or Portfolio's custodian bank. For
the purpose of determining the adequacy of the securities in the account, the
deposited securities will be valued at market value. If the market value of such
securities declines, additional cash, cash equivalents or highly liquid
securities will be placed in the account daily so that the value of the account
will equal the amount of such commitments by the Fund or Portfolio.

Although it is not intended that such purchases would be made for speculative
purposes, purchases of securities on a forward commitment basis may involve more
risk than other types of purchases. Securities purchased on a forward commitment
basis and the securities held in the Fund's or Portfolio's portfolio are subject
to changes in value based upon the public's perception of the issuer and
changes, real or anticipated, in the level of interest rates. Purchasing
securities on a forward commitment basis can involve the risk that the yields
available in the market when the delivery takes place may actually be higher or
lower than those obtained in the transaction itself. On the settlement date of
the forward commitment transaction, the Fund or Portfolio will meet its
obligations from then available cash flow, sale of securities held in the
separate account, sale of other securities or, although it would not normally
expect to do so, from sale of the forward commitment securities themselves
(which may have a value greater or lesser than the Fund's or Portfolio's payment
obligations). The sale of securities to meet such obligations may result in the
realization of capital gains or losses.

To the extent the Fund or Portfolio engages in forward commitment transactions,
it will do so for the purpose of acquiring securities consistent with its
investment objective and policies and not for the purpose of investment
leverage, and settlement of such transactions will be within 90 days from the
trade date.

<PAGE>

Reverse Repurchase Agreements. Reverse repurchase agreements involve the sale of
securities held by the Fund or Portfolio with an agreement to repurchase the
securities at an agreed upon price and date. The repurchase price is generally
equal to the original sales price plus interest. Reverse repurchase agreements
are usually for seven days or less and cannot be repaid prior to their
expiration dates. Reverse repurchase agreements involve the risk that the market
value of the portfolio securities transferred may decline below the price at
which the Fund or Portfolio is obliged to purchase the securities.

Stripped Obligations. The principal and interest components of United States
Treasury bonds with remaining maturities of longer than ten years are eligible
to be traded independently under the Separate Trading of Registered Interest and
Principal of Securities ("STRIPS") program. Under the STRIPS program, the
principal and interest components are separately issued by the United States
Treasury at the request of depository financial institutions, which then trade
the component parts separately. The interest component of STRIPS may be more
volatile than that of United States Treasury bills with comparable maturities.

<PAGE>

Illiquid Securities. For purposes of its limitation on investments in illiquid
securities, the Fund and Portfolio may elect to treat as liquid, in accordance
with procedures established by the Board of Trustees, certain investments in
restricted securities for which there may be a secondary market of qualified
institutional buyers as contemplated by Rule 144A under the Securities Act of
1933, as amended (the "Securities Act") and commercial obligations issued in
reliance on the so-called "private placement" exemption from registration
afforded by Section 4(2) of the Securities Act ("Section 4(2) paper"). Rule 144A
provides an exemption from the registration requirements of the Securities Act
for the resale of certain restricted securities to qualified institutional
buyers. Section 4(2) paper is restricted as to disposition under the federal
securities laws, and generally is sold to institutional investors such as the
Fund and Portfolio who agree that they are purchasing the paper for investment
and not with a view to public distribution. Any resale of Section 4(2) paper by
the purchaser must be in an exempt transaction.

One effect of Rule 144A and Section 4(2) is that certain restricted securities
may now be liquid, though there is no assurance that a liquid market for Rule
144A securities or Section 4(2) paper will develop or be maintained. The
Trustees have adopted policies and procedures for the purpose of determining
whether securities that are eligible for resale under Rule 144A and Section 4(2)
paper are liquid or illiquid for purposes of the limitation on investment in
illiquid securities. Pursuant to those policies and procedures, the Trustees
have delegated to the advisers the determination as to whether a particular
instrument is liquid or illiquid, requiring that consideration be given to,
among other things, the frequency of trades and quotes for the security, the
number of dealers willing to sell the security and the number of potential
purchasers, dealer undertakings to make a market in the security, the nature of
the security and the time needed to dispose of the security. The Trustees will
periodically review the Fund's and Portfolio's purchases and sales of Rule 144A
securities and Section 4(2) paper.

Stand-by Commitments. In a put transaction, the Fund or Portfolio acquires the
right to sell a security at an agreed upon price within a specified period prior
to its maturity date, and a stand-by commitment entitles the Fund or Portfolio
to same-day settlement and to receive an exercise price equal to the amortized
cost of the underlying security plus accrued interest, if any, at the time of
exercise. Stand-by commitments are subject to certain risks, which include the
inability of the issuer of the commitment to pay for the securities at the time
the commitment is exercised, the fact that the commitment is not marketable by
the Fund or Portfolio, and that the maturity of the underlying security will
generally be different from that of the commitment.

Securities Loans. To the extent specified in the Prospectus, the Fund and
Portfolio are permitted to lend their securities to broker-dealers and other
institutional investors in order to generate additional income. Such loans of
portfolio securities may not exceed 30% of the value of the Fund's or
Portfolio's total assets. In connection with such loans, the Fund or Portfolio
will receive collateral consisting of cash, cash equivalents, U.S. Government
securities or irrevocable letters of credit issued by financial institutions.
Such collateral will be maintained at all times in an amount equal to at least
102% of the current market value plus accrued interest of the securities loaned.
The Fund or Portfolio can increase its income through the investment of such
collateral. The Fund or Portfolio continues to be entitled to the interest
payable or any dividend-equivalent payments received on a loaned security and,
in addition, to receive interest on the amount of the loan. However, the receipt
of any dividend-equivalent payments by the Fund or Portfolio on a loaned
security from the borrower will not qualify for the dividends-received
deduction. Such loans will be terminable at any time upon specified notice. The
Fund or Portfolio might experience risk of loss if the institutions with which
it has engaged in portfolio loan transactions breach their agreements with the
Fund or Portfolio. The risks in lending portfolio securities, as with other
extensions of secured credit, consist of possible delays in receiving additional
collateral or in the recovery of the securities or possible loss of rights in
the collateral should the borrower experience financial difficulty. Loans will
be made only to firms deemed by the advisers to be of good standing and will not
be made unless, in the judgment of the advisers, the consideration to be earned
from such loans justifies the risk.

Additional Policies Regarding Derivative And Related Transactions

Introduction. As explained more fully below, the Fund and Portfolio may employ
derivative and related instruments as tools in the management of portfolio
assets. Put briefly, a "derivative" instrument may be considered a security or
other instrument which derives its value from the value or performance of

<PAGE>

other instruments or assets, interest or currency exchange rates, or indexes.
For instance, derivatives include futures, options, forward contracts,
structured notes and various over-the-counter instruments.

Like other investment tools or techniques, the impact of using derivatives
strategies or similar instruments depends to a great extent on how they are
used. Derivatives are generally used by portfolio managers in three ways: First,
to reduce risk by hedging (offsetting) an investment position. Second, to
substitute for another security particularly where it is quicker, easier and
less expensive to invest in derivatives. Lastly, to speculate or enhance
portfolio performance. When used prudently, derivatives can offer several
benefits, including easier and more effective hedging, lower transaction costs,
quicker investment and more profitable use of portfolio assets. However,
derivatives also have the potential to significantly magnify risks, thereby
leading to potentially greater losses for the Fund or Portfolio.

The Fund and Portfolio may invest its assets in derivative and related
instruments subject only to the Fund's or Portfolio's investment objective and
policies and the requirement that the Fund or Portfolio maintain segregated
accounts consisting of liquid assets, such as cash, U.S. Government securities,
or other high-grade debt obligations (or, as permitted by applicable regulation,
enter into certain offsetting positions) to cover its obligations under such
instruments with respect to positions where there is no underlying portfolio
asset so as to avoid leveraging the Fund or Portfolio.

The value of some derivative or similar instruments in which the Fund or
Portfolio may invest may be particularly sensitive to changes in prevailing
interest rates or other economic factors, and--like other investments of the
Fund and Portfolio--the ability of the Fund or Portfolio to successfully utilize
these instruments may depend in part upon the ability of the advisers to
forecast interest rates and other economic factors correctly. If the advisers
inaccurately forecast such factors and have taken positions in derivative or
similar instruments contrary to prevailing market trends, the Fund and Portfolio
could be exposed to the risk of a loss. The Fund or Portfolio might not employ
any or all of the strategies described herein, and no assurance can be given
that any strategy used will succeed.

Set forth below is an explanation of the various derivatives strategies and
related instruments the Fund and Portfolio may employ along with risks or
special attributes associated with them. This discussion is intended to
supplement the Fund's current prospectus as well as provide useful information
to prospective investors.

Risk Factors. As explained more fully below and in the discussions of particular
strategies or instruments, there are a number of risks associated with the use
of derivatives and related instruments. There can be no guarantee that there
will be a correlation between price movements in a hedging vehicle and in the
portfolio assets being hedged. An incorrect correlation could result in a loss
on both the hedged assets in the portfolio and the hedging vehicle so that the
portfolio return might have been greater had hedging not been attempted. This
risk is particularly acute in the case of "cross-hedges" between currencies. The
advisers may inaccurately forecast interest rates, market values or other
economic factors in utilizing a derivatives strategy. In such a case, the Fund
or Portfolio may have been in a better position had it not entered into such
strategy. Hedging strategies, while reducing risk of loss, can also reduce the
opportunity for gain. In other words, hedging usually limits both potential
losses as well as potential gains. Strategies not involving hedging may increase
the risk to the Fund or Portfolio. Certain strategies, such as yield
enhancement, can have speculative characteristics and may result in more risk to
the Fund or Portfolio than hedging strategies using the same instruments. There
can be no assurance that a liquid market will exist at a time when the Fund or
Portfolio seeks to close out an option, futures contract or other derivative or
related position. Many exchanges and boards of trade limit the amount of
fluctuation permitted in option or futures contract prices during a single day;
once the daily limit has been reached on particular contract, no trades may be
made that day at a price beyond that limit. In addition, certain instruments are
relatively new and without a significant trading history. As a result, there is
no assurance that an active secondary market will develop or continue to exist.
Finally, over-the-counter instruments typically do not have a liquid market.
Lack of a liquid market for any reason may prevent the Fund or Portfolio from
liquidating an unfavorable position. Activities of large traders in the futures
and securities markets involving arbitrage, "program trading," and other
investment strategies may cause price distortions in these markets. In certain
instances, particularly those involving over-the-counter transactions and
forward contracts, there is a greater potential that a counterparty or broker
may default or be unable to perform on its commitments. In the event of such a
default, the Fund or Portfolio may experience a loss. In transactions involving
currencies, the value of the currency underlying an instrument may fluctuate due
to many factors, including economic conditions, interest rates, governmental
policies and market forces.

Specific Uses And Strategies. Set forth below are explanations of various
strategies involving derivatives and related instruments which may be used by
the Fund or Portfolio.

Options On Securities, Securities Indexes And Debt Instruments. The Fund or
Portfolio may PURCHASE, SELL or EXERCISE call and put options on (i) securities,
(ii) securities indexes, and (iii) debt instruments.

Although in most cases these options will be exchange-traded, the Fund or
Portfolio may also purchase, sell or exercise over-the-counter options.
Over-the-counter options differ from exchange-traded options in that they are
two-party contracts with price and other terms negotiated between buyer and
seller. As such, over-the-counter options generally have much less market
liquidity and carry the risk of default or nonperformance by the other party.

One purpose of purchasing put options is to protect holdings in an underlying or
related security against a substantial decline in market value. One purpose of
purchasing call options is to protect against substantial increases in prices of
securities the Fund or Portfolio intends

<PAGE>

to purchase pending its ability to invest in such securities in an orderly
manner. The Fund or Portfolio may also use combinations of options to minimize
costs, gain exposure to markets or take advantage of price disparities or market
movements. For example, the Fund or Portfolio may sell put or call options it
has previously purchased or purchase put or call options it has previously sold.
These transactions may result in a net gain or loss depending on whether the
amount realized on the sale is more or less than the premium and other
transaction costs paid on the put or call option which is sold. The Fund or
Portfolio may write a call or put option in order to earn the related premium
from such transactions. Prior to exercise or expiration, an option may be closed
out by an offsetting purchase or sale of a similar option. The Fund and
Portfolio will not write uncovered options.

In addition to the general risk factors noted above, the purchase and writing of
options involve certain special risks. During the option period, where the Fund
or Portfolio has written a covered call (i.e., where the underlying securities
are held by the Fund or Portfolio), it has, in return for the premium on the
option, given up the opportunity to profit from a price increase in the
underlying securities above the exercise price, but has retained the risk of
loss should the price of the underlying securities decline. The writer of an
option has no control over the time when it may be required to fulfill its
obligation as a writer of the option. Once an option writer has received an
exercise notice, it cannot effect a closing purchase transaction in order to
terminate its obligation under the option and must deliver the underlying
securities at the exercise price.

If a put or call option purchased by the Fund or Portfolio is not sold when it
has remaining value, and if the market price of the underlying security, in the
case of a put, remains equal to or greater than the exercise price or, in the
case of a call, remains less than or equal to the exercise price, the Fund or
Portfolio will lose its entire investment in the option. Also, where a put or
call option on a particular security is purchased to hedge against price
movements in a related security, the price of the put or call option may move
more or less than the price of the related security. There can be no assurance
that a liquid market will exist when the Fund or Portfolio seeks to close out an
option position. Furthermore, if trading restrictions or suspensions are imposed
on the options markets, the Fund or Portfolio may be unable to close out a
position.

Futures Contracts And Options On Futures Contracts. The Fund or Portfolio may
purchase or sell (i) interest-rate futures contracts, (ii) futures contracts on
specified instruments or indices, and (iii) options on these futures contracts
("futures options").

The futures contracts and futures options may be based on various instruments or
indices in which the Fund and Portfolio may invest such as foreign currencies,
certificates of deposit, Eurodollar time deposits, securities indices, economic
indices (such as the Consumer Price Indices compiled by the U.S. Department of
Labor).

Futures contracts and futures options may be used to hedge portfolio positions
and transactions as well as to gain exposure to markets. For example, the Fund
or Portfolio may sell a futures contract--or buy a futures option--to protect
against a decline in value, or reduce the duration, of portfolio holdings.
Likewise, these instruments may be used where the Fund or Portfolio intends to
acquire an instrument or enter into a position. For example, the Fund or
Portfolio may purchase a futures contract--or buy a futures option--to gain
immediate exposure in a market or otherwise offset increases in the purchase
price of securities or currencies to be acquired in the future. Futures options
may also be written to earn the related premiums.

When writing or purchasing options, the Fund and Portfolio may simultaneously
enter into other transactions involving futures contracts or futures options in
order to minimize costs, gain exposure to markets, or take advantage of price
disparities or market movements. Such strategies may entail additional risks in
certain instances. The Fund and Portfolio may engage in cross-hedging by
purchasing or selling futures or options on a security or currency different
from the security or currency position being hedged to take advantage of
relationships between the two securities or currencies.

Investments in futures contracts and options thereon involve risks similar to
those associated with options transactions discussed above. The Fund and
Portfolio will only enter into futures contracts or options on futures contracts
which are traded on a U.S. or foreign exchange or board of trade, or similar
entity, or quoted on an automated quotation system.

Forward Contracts. The Fund and Portfolio may use foreign currency and
interest-rate forward contracts for various purposes as described below.

Foreign 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 the relative merits of investments in different
countries, actual or perceived changes in interest rates and other complex
factors, as seen from an international perspective. The Fund or Portfolio may
invest in securities denominated in foreign currencies and may, in addition to
buying and selling foreign currency futures contracts and options on foreign
currencies and foreign currency futures, enter into forward foreign currency
exchange contracts to reduce the risks or otherwise take a position in
anticipation of changes in foreign exchange rates. A forward foreign currency
exchange contract involves an obligation to purchase or sell a specific currency
at a future date, which may be a fixed number of days from the date of the
contract agreed upon by the parties, at a price set at the time of the contract.
By entering into a forward foreign currency contract, the Fund or Portfolio
"locks in" the exchange rate between the currency it will deliver and the
currency it will receive for the duration of the contract. As a result, the Fund
or Portfolio reduces its exposure to changes in the value of the currency it
will deliver and increases its exposure to changes in the value of the currency
it will exchange into. The effect on the value of the Fund or Portfolio is
similar to selling securities denominated in one currency and purchasing
securities denominated in another. Transactions that use two foreign currencies
are sometimes referred to as "cross-hedges."

<PAGE>

The Fund or Portfolio may enter into these contracts for the purpose of hedging
against foreign exchange risk arising from the Fund's or Portfolio's investments
or anticipated investments in securities denominated in foreign currencies. The
Fund or Portfolio may also enter into these contracts for purposes of
increasing exposure to a foreign currency or to shift exposure to foreign
currency fluctuations from one country to another.

The Fund or Portfolio may also use forward contracts to hedge against changes
in interest rates, increase exposure to a market or otherwise take advantage of
such changes. An interest-rate forward contract involves the obligation to
purchase or sell a specific debt instrument at a fixed price at a future date.

Interest Rate And Currency Transactions. The Fund or Portfolio may employ
currency and interest rate management techniques, including transactions in
options (including yield curve options), futures, options on futures, forward
foreign currency exchange contracts, currency options and futures and currency
and interest rate swaps. The aggregate amount of the Fund's or Portfolio's net
currency exposure will not exceed the total net asset value of its portfolio.
However, to the extent that the Fund or Portfolio is fully invested while also
maintaining currency positions, it may be exposed to greater combined risk.

The Fund and Portfolio will only enter into interest rate and currency swaps on
a net basis, i.e., the two payment streams are netted out, with the Fund or
Portfolio receiving or paying, as the case may be, only the net amount of the
two payments. Interest rate and currency swaps do not involve the delivery of
securities, the underlying currency, other underlying assets or principal.
Accordingly, the risk of loss with respect to interest rate and currency swaps
is limited to the net amount of interest or currency payments that the Fund or
Portfolio is contractually obligated to make. If the other party to an interest
rate or currency swap defaults, the Fund's or Portfolio's risk of loss consists
of the net amount of interest or currency payments that the Fund or Portfolio is
contractually entitled to receive. Since interest rate and currency swaps are
individually negotiated, the Fund and Portfolio expect to achieve an acceptable
degree of correlation between its portfolio investments and its interest rate or
currency swap positions.

The Fund or Portfolio may hold foreign currency received in connection with
investments in foreign securities when it would be beneficial to convert such
currency into U.S. dollars at a later date, based on anticipated changes in the
relevant exchange rate.

The Fund or Portfolio may purchase or sell without limitation as to a percentage
of its assets forward foreign currency exchange contracts when the advisers
anticipate that the foreign currency will appreciate or depreciate in value, but
securities denominated in that currency do not present attractive investment
opportunities and are not held by the Fund or Portfolio. In addition, the Fund
or Portfolio may enter into forward foreign currency exchange contracts in order
to protect against adverse changes in future foreign currency exchange rates.
The Fund or Portfolio may engage in cross-hedging by using forward contracts in
one currency to hedge against fluctuations in the value of securities
denominated in a different currency if its advisers believe that there is a
pattern of correlation between the two currencies. Forward contracts may reduce
the potential gain from a positive change in the relationship between the U.S.
Dollar and foreign currencies. Unanticipated changes in currency prices may
result in poorer overall performance for the Fund or Portfolio than if it had
not entered into such contracts. The use of foreign currency forward contracts
will not eliminate fluctuations in the underlying U.S. dollar equivalent value
of the prices of or rates of return on the Fund's or Portfolio's foreign
currency denominated portfolio securities and the use of such techniques will
subject the Fund or Portfolio to certain risks.

The matching of the increase in value of a forward contract and the decline in
the U.S. dollar equivalent value of the foreign currency denominated asset that
is the subject of the hedge generally will not be precise. In addition, the Fund
or Portfolio may not always be able to enter into foreign currency forward
contracts at attractive prices, and this will limit the Fund's or Portfolio's
ability to use such contract to hedge or cross-hedge its assets. Also, with
regard to the Fund's or Portfolio's use of cross-hedges, there can be no
assurance that historical correlations between the movement of certain foreign
currencies relative to the U.S. dollar will continue. Thus, at any time poor
correlation may exist between movements in the exchange rates of the foreign
currencies underlying the Fund's or Portfolio's cross-hedges and the movements
in the exchange rates of the foreign currencies in which the Fund's or
Portfolio's assets that are the subject of such cross-hedges are denominated.

The Fund or Portfolio may enter into interest rate and currency swaps to the
maximum allowed limits under applicable law. The Fund or Portfolio will
typically use interest rate swaps to shorten the effective duration of its
portfolio. Interest rate swaps involve the exchange by the Fund or Portfolio
with another party of their respective commitments to pay or receive interest,
such as an exchange of fixed rate payments for floating rate payments. Currency
swaps involve the exchange of their respective rights to make or receive
payments in specified currencies.

10
<PAGE>

Structured Products. The Fund or Portfolio may invest in interests in entities
organized and operated solely for the purpose of restructuring the investment
characteristics of certain other investments. This type of restructuring
involves the deposit with or purchase by an entity, such as a corporation or
trust, or specified instruments (such as commercial bank loans) and the issuance
by that entity of one or more classes of securities ("structured products")
backed by, or representing interests in, the underlying instruments. The cash
flow on the underlying instruments may be apportioned among the newly issued
structured products to create securities with different investment
characteristics such as varying maturities, payment priorities and interest rate
provisions, and the extent of the payments made with respect to structured
products is dependent on the extent of the cash flow on the underlying
instruments. The Fund or Portfolio may invest in structured products which
represent derived investment positions based on relationships among different
markets or asset classes.

The Fund or Portfolio may also invest in other types of structured products,
including, among others, inverse floaters, spread trades and notes linked by a
formula to the price of an underlying instrument. Inverse floaters have coupon
rates that vary inversely at a multiple of a designated floating rate (which
typically is determined by reference to an index rate, but may also be
determined through a dutch auction or a remarketing agent or by reference to
another security) (the "reference rate"). As an example, inverse floaters may
constitute a class of CMOs with a coupon rate that moves inversely to a
designated index, such as LIBOR (London Interbank Offered Rate) or the Cost of
Funds Index. Any rise in the reference rate of an inverse floater (as a
consequence of an increase in interest rates) causes a drop in the coupon rate
while any drop in the reference rate of an inverse floater causes an increase in
the coupon rate. A spread trade is

11
<PAGE>

an investment position relating to a difference in the prices or interest rates
of two securities where the value of the investment position is determined by
movements in the difference between the prices or interest rates, as the case
may be, of the respective securities. When the Fund or Portfolio invests in
notes linked to the price of an underlying instrument, the price of the
underlying security is determined by a multiple (based on a formula) of the
price of such underlying security. A structured product may be considered to be
leveraged to the extent its interest rate varies by a magnitude that exceeds the
magnitude of the change in the index rate of interest. Because they are linked
to their underlying markets or securities, investments in structured products
generally are subject to greater volatility than an investment directly in the
underlying market or security. Total return on the structured product is derived
by linking return to one or more characteristics of the underlying instrument.
Because certain structured products of the type in which the Fund or Portfolio
may invest may involve no credit enhancement, the credit risk of those
structured products generally would be equivalent to that of the underlying
instruments. The Fund or Portfolio may invest in a class of structured products
that is either subordinated or unsubordinated to the right of payment of another
class. Subordinated structured products typically have higher yields and present
greater risks than unsubordinated structured products. Although the Fund's or
Portfolio's purchase of subordinated structured products would have similar
economic effect to that of borrowing against the underlying securities, the
purchase will not be deemed to be leverage for purposes of the Fund's or
Portfolio's fundamental investment limitation related to borrowing and leverage.

Certain issuers of structured products may be deemed to be "investment
companies" as defined in the 1940 Act. As a result, the Fund's or Portfolio's
investments in these structured products may be limited by the restrictions
contained in the 1940 Act. Structured products are typically sold in private
placement transactions, and there currently is no active trading market for
structured products. As a result, certain structured products in which the Fund
or Portfolio invests may be deemed illiquid and subject to its limitation on
illiquid investments.

Investments in structured products generally are subject to greater volatility
than an investment directly in the underlying market or security. In addition,
because structured products are typically sold in private placement
transactions, there currently is no active trading market for structured
products.

Additional Restrictions On The Use Of Futures And Option Contracts. The Fund and
Portfolio are not "commodity pools" (i.e., a pooled investment vehicle which
trades in commodity futures contracts and options thereon and the operator of
which is registered with the CFTC) and futures contracts and futures options
will be purchased, sold or entered into only for bona fide hedging purposes,
provided that the Fund or Portfolio may enter into such transactions for
purposes other than bona fide hedging if, immediately thereafter, the sum of the
amount of its initial margin and premiums on open contracts and options would
not exceed 5% of the liquidation value of the Fund's or Portfolio's portfolio,
provided, further, that, in the case of an option that is in-the-money, the
in-the-money amount may be excluded in calculating the 5% limitation.

When the Fund or Portfolio purchases a futures contract, an amount of cash or
cash equivalents or high quality debt securities will be deposited in a
segregated account with the Fund's or Portfolio's custodian or sub-custodian so
that the amount so segregated, plus the initial deposit and variation margin
held in the account of its broker, will at all times equal the value of the
futures contract, thereby insuring that the use of such futures is unleveraged.

The Fund's or Portfolio's ability to engage in the transactions described herein
may be limited by the current federal income tax requirement that the Fund and
Portfolio derive less than 30% of their gross income from the sale or other
disposition of stock or securities held for less than three months.

Investment Restrictions

The Fund and Portfolio have adopted the following investment restrictions which
may not be changed without approval by a "majority of the outstanding shares" of
the Fund or Portfolio which, as used in this Statement of Additional
Information, means the vote of the lesser of (i) 67% or more of the shares of
the Fund or total beneficial interests of the Portfolio present at a meeting, if
the holders of more than 50% of the outstanding shares of the Fund or total
beneficial interests of the Portfolio are present or represented by proxy, or
(ii) more than 50% of the outstanding shares of the Fund or total beneficial
interests of the Portfolio.

Whenever the Trust is requested to vote on a fundamental policy of the
Portfolio, the Trust will hold a meeting of shareholders of the Fund and will
cast its votes as instructed by the shareholders of the Fund.

It is a fundamental policy of the Fund that when the Fund holds no portfolio
securities except interests in the Portfolio, the Fund's investment objective
and policies shall be identical to the Portfolio's investment objective and
policies, except for the following: the Fund (1) may invest more than 10% of its
net assets in the securities of a registered investment company, (2) may hold
more than 10% of the voting securities of a registered investment company, and
(3) will concentrate its investments in the investment company. It is a
fundamental investment policy of the Fund that when the Fund holds only
portfolio securities other than interests in the Portfolio, the Fund's
investment objective and policies shall be identical to the investment objective
and policies of the Portfolio at the time the assets of the Fund were withdrawn
from the Portfolio.

12
<PAGE>

The Fund and Portfolio may not: (1) borrow money, except that the Fund and
Portfolio may borrow money for temporary or emergency purposes, or by engaging
in reverse repurchase transactions, in an amount not exceeding 33-1/3% of the
value of its total assets at the time when the loan is made and may pledge,
mortgage or hypothecate no more than 1/3 of its net assets to secure such
borrowings. Any borrowings representing more than 5% of the Fund's or
Portfolio's total assets must be repaid before the Fund or Portfolio may make
additional investments;

(2) make loans, except that the Fund and Portfolio may: (i) purchase and hold
debt instruments (including without limitation, bonds, notes, debentures or
other obligations and certificates of deposit, bankers' acceptances and fixed
time deposits) in accordance with its investment objectives and policies; (ii)
enter into repurchase agreements with respect to portfolio securities; and (iii)
lend portfolio securities with a value not in excess of one-third of the value
of its total assets;

(3) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or instrumentalities,
or repurchase agreements secured thereby) if, as a result, more than 25% of the
Fund's or Portfolio's total assets would be invested in the securities of
companies whose principal business activities are in the same industry.
Notwithstanding the foregoing, with respect to the Fund's or Portfolio's
permissible futures and options transactions in U.S. Government securities,
positions in such options and futures shall not be subject to this restriction;

(4) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments but this shall not prevent the Fund
or Portfolio from (i) purchasing or selling options and futures contracts or
from investing in securities or other instruments backed by physical commodities
or (ii) engaging in forward purchases or sales of foreign currencies or
securities;

(5) purchase or sell real estate unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the Fund or
Portfolio from investing insecurities or other instruments backed by real estate
or securities of companies engaged in the real estate business). Investments by
the Fund or Portfolio in securities backed by mortgages on real estate or in
marketable securities of companies engaged in such activities are not hereby
precluded;

(6) issue any senior security (as defined in the 1940 Act), except that (a) the
Fund or Portfolio may engage in transactions that may result in the issuance of
senior securities to the extent permitted under applicable regulations and
interpretations of the 1940 Act or an exemptive order; (b) the Fund or Portfolio
may acquire other securities, the acquisition of which may result in the
issuance of a senior security, to the extent permitted under applicable
regulations or interpretations of the 1940 Act; and (c) subject to the
restrictions set forth above, the Fund or Portfolio may borrow money as
authorized by the 1940 Act. For purposes of this restriction, collateral
arrangements with respect to permissible options and futures transactions,
including deposits of initial and variation margin, are not considered to be the
issuance of a senior security; or

(7) underwrite securities issued by other persons except insofar as the Fund or
Portfolio may technically be deemed to be an underwriter under the Securities
Act of 1933 in selling a portfolio security.

In addition, as a matter of fundamental policy, notwithstanding any other
investment policy or restriction, the Fund may seek to achieve its investment
objective by investing all of its investable assets in another investment
company having substantially the same investment objective and policies as the
Fund. For purposes of investment restriction (5) above, real estate includes
Real Estate Limited Partnerships. For purposes of investment restriction (3)
above, industrial development bonds, where the payment of principal and interest
is the ultimate responsibility of companies within the same industry, are
grouped together as an "industry." Investment restriction (3) above, however, is
not applicable to investments by the Fund or Portfolio in municipal obligations
where the issuer is regarded as a state, city, municipality or other public
authority since such entities are not members of an "industry." Supranational
organizations are collectively considered to be members of a single "industry"
for purposes of restriction (3) above.

In addition, the Fund and Portfolio are subject to the following nonfundamental
restrictions which may be changed without shareholder approval:

(1) The Fund and Portfolio may not, with respect to 50% of their respective
assets, hold more than 10% of the outstanding voting securities of any issuer.

(2) The Fund and Portfolio may not make short sales of securities, other than
short sales "against the box," or purchase securities on margin except for
short-term credits necessary for clearance of portfolio transactions, provided
that this restriction will not be applied to limit the use of options, futures
contracts and related options, in the manner otherwise permitted by the
investment restrictions, policies and investment program of the Fund or
Portfolio.

(3) The Fund and Portfolio may not purchase or sell interests in oil, gas or
mineral leases.

(4) The Fund and Portfolio may not invest more than 15% of their respective net
assets in illiquid securities.

13
<PAGE>

(5) The Fund and Portfolio may not write, purchase or sell any put or call
option or any combination thereof, provided that this shall not prevent (i) the
writing, purchasing or selling of puts, calls or combinations thereof with
respect to portfolio securities or (ii) with respect to the Fund's or
Portfolio's permissible futures and options transactions, the writing,
purchasing, ownership, holding or selling of futures and options positions or of
puts, calls or combinations thereof with respect to futures.

(6) The Fund and Portfolio may invest up to 5% of their respective total assets
in the securities of any one investment company, but may not own more than 3% of
the securities of any one investment company or invest more than 10% of its
total assets in the securities of other investment companies.

It is the Trust's position that proprietary strips, such as CATS and TIGRS, are
United States Government securities. However, the Trust has been advised that
the staff of the Securities and Exchange Commission's Division of Investment
Management does not consider these to be United States Government securities, as
defined under the Investment Company Act of 1940, as amended.

For purposes of the Fund's and Portfolio's investment restrictions, the issuer
of a tax-exempt security is deemed to be the entity (public or private)
ultimately responsible for the payment of the principal of and interest on the
security.

In order to permit the sale of its shares in certain states, the Fund or
Portfolio may make commitments more restrictive than the investment policies and
limitations described above and in the Fund's Prospectus. Should the Fund or
Portfolio determine that any such commitment is no longer in its best interests,
it will revoke the commitment by terminating sales of its shares in the state
involved. In order to comply with certain federal and state statutes and
regulatory policies, as a matter of operating policy, the Fund and Portfolio
will not: (i) invest more than 5% of its assets in companies which, including
predecessors, have a record of less than three years' continuous operation, (ii)
invest in warrants, valued at the lower of cost or market, in excess of 5% of
the value of its net assets, and no more than 2% of such value may be warrants
which are not listed on the New York or American Stock Exchanges, or (iii)
purchase or retain in its portfolio any securities issued by an issuer any of
whose officers, directors, trustees or security holders is an officer or Trustee
of the Trust or Portfolio, or is an officer or director of the adviser, if after
the purchase of the securities of such issuer by the Fund or Portfolio one or
more of such persons owns beneficially more than 1/2 of 1% of the shares or
securities, or both, all taken at market value, of such issuer, and such persons
owning more than 1/2 of 1% of such shares or securities together own
beneficially more than 5% of such shares or securities, or both, all taken at
market value.

If a percentage or rating restriction on investment or use of assets set forth
herein or in the Prospectus is adhered to at the time a transaction is effected,
later changes in percentage resulting from any cause other than actions by the
Fund or Portfolio will not be considered a violation. If the value of the Fund's
or Portfolio's holdings of illiquid securities at any time exceeds the
percentage limitation applicable at the time of acquisition due to subsequent
fluctuations in value or other reasons, the Board of Trustees will consider what
actions, if any, are appropriate to maintain adequate liquidity.

Portfolio Transactions And Brokerage Allocation

Specific decisions to purchase or sell securities for the Portfolio are made by
a portfolio manager who is an employee of the adviser or sub-adviser to the
Portfolio and who is appointed and supervised by senior officers of such adviser
or sub-adviser. Changes in the Portfolio's investments are reviewed by the Board
of Trustees of the Trust or Portfolio. The portfolio managers may serve other
clients of the advisers in a similar capacity.

The frequency of the Portfolio's portfolio transactions--the portfolio turnover
rate--will vary from year to year depending upon market conditions. Because a
high turnover rate may increase transaction costs and the possibility of taxable
short-term gains, the advisers will weigh the added costs of short-term
investment against anticipated gains. The Portfolio will engage in portfolio
trading if its advisers believe a transaction, net of costs (including custodian
charges), will help it achieve its investment objective. The Portfolio applies
this policy with respect to both the equity and debt portions of its portfolio.

14
<PAGE>

The Vista Select Growth and Income Fund invests all of its investable assets in
the Portfolio and does not invest directly in a portfolio of assets, and
therefore does not have reportable portfolio turnover rates. The portfolio
turnover rate for the Growth and Income Portfolio for the fiscal year ended
October 31, 1994 was 57%, and for the fiscal year ended October 31, 1995, the
portfolio turnover rate was 71%.

Under the advisory agreement and the sub-advisory agreement, the adviser and
sub-adviser shall use their best efforts to seek to execute portfolio
transactions at prices which, under the circumstances, result in total costs or
proceeds being the most favorable to the Portfolio. In assessing the best
overall terms available for any transaction, the adviser and sub-advisers
consider all factors they deem relevant, including the breadth of the market in
the security, the price of the security, the financial condition and execution
capability of the broker or dealer, research services provided to the adviser or
sub-advisers, and the reasonableness of the commissions, if any, both for the
specific transaction and on a continuing basis. The adviser and sub-adviser are
not required to obtain the lowest commission or the best net price for the
Portfolio on any particular transaction, and are not required to execute any
order in a fashion either preferential to the Portfolio relative to other
accounts they manage or otherwise materially adverse to such other accounts.

Debt securities are traded principally in the over-the-counter market through
dealers acting on their own account and not as brokers. In the case of
securities traded in the over-the-counter market (where no stated commissions
are paid but the prices include a dealer's markup or markdown), the adviser or
sub-adviser to the Portfolio normally seeks to deal directly with the primary
market makers unless, in its opinion, best execution is available elsewhere. In
the case of securities purchased from underwriters, the cost of such securities
generally includes a fixed underwriting commission or concession. From time to
time, soliciting dealer fees are available to the adviser or sub-adviser on the
tender of the Portfolio's portfolio securities in so-called tender or exchange
offers. Such soliciting dealer fees are in effect recaptured for the Portfolio
by the adviser and sub-advisers. At present, no other recapture arrangements are
in effect.

Under the advisory and sub-advisory agreement and as permitted by Section 28(e)
of the Securities Exchange Act of 1934, the adviser or sub-adviser may cause
the Portfolio to pay a broker-dealer which provides brokerage and research
services to the adviser or sub-adviser, the Portfolio and/or other accounts for
which they exercise investment discretion an amount of commission for effecting
a securities transaction for the Portfolio in excess of the amount other
broker-dealers would have charged for the transaction if they determine in good
faith that the greater commission is reasonable in relation to the value of the
brokerage and research services provided by the executing broker-dealer viewed
in terms of either a particular transaction or their overall responsibilities to
accounts over which they exercise investment discretion. Not all of such
services are useful or of value in advising the Portfolio. The adviser and
sub-adviser report to the Board of Trustees regarding overall commissions paid
by the Portfolio and their reasonableness in relation to the benefits to the
Portfolio. The term "brokerage and research services" includes advice as to the
value of securities, the advisability of investing in, purchasing or selling
securities, and the availability of securities or of purchasers or sellers of
securities, furnishing analyses and reports concerning issues, industries,
securities, economic factors and trends, portfolio strategy and the performance
of accounts, and effecting securities transactions and performing functions
incidental thereto such as clearance and settlement.

The management fees that the Portfolio pays to the adviser will not be reduced
as a consequence of the adviser's or sub-adviser's receipt of brokerage and
research services. To the extent the Portfolio's portfolio transactions are used
to obtain such services, the brokerage commissions paid by the Portfolio will
exceed those that might otherwise be paid by an amount which cannot be presently
determined. Such services generally would be useful and of value to the adviser
or sub-adviser in serving one or more of their other clients and, conversely,
such services obtained by the placement of brokerage business of other clients
generally would be useful to the adviser and sub-advisers in carrying out their
obligations to the Portfolio. While such services are not expected to reduce the
expenses of the adviser or sub-adviser, they advisers would, through use of the
services, avoid the additional expenses which would be incurred if they should
attempt to develop comparable information through their own staffs.

In certain instances, there may be securities that are suitable for the
Portfolio as well as one or more of the adviser's or sub-adviser's other
clients. Investment decisions for the Portfolio and for other clients are made
with a view to achieving their respective investment objectives. It may develop
that the same investment decision is made for more than one client or that a
particular security is bought or sold for only one client even though it might
be held by, or bought or sold for, other clients. Likewise, a particular
security may be bought for one or more clients when one or more clients are
selling that same security. Some simultaneous transactions are inevitable when
several clients receive investment advice from the same investment adviser,
particularly when the same security is suitable for the investment objectives of
more than one client. When the Portfolio and one or more other clients are
simultaneously engaged in the purchase or sale of the same security, the
securities are allocated among clients in a

15
<PAGE>

manner believed to be equitable to each. It is recognized that in some cases
this system could have a detrimental effect on the price or volume of the
security as far as the Portfolio is concerned. However, it is believed that the
ability of the Portfolio to participate in volume transactions will generally
produce better executions for the Portfolio.

For the fiscal years ended October 31, 1994 and 1995, the Growth and Income
Portfolio paid aggregate brokerage commissions of $1,515,504 and $2,352,596,
respectively.

No portfolio transactions are executed with the advisers or with any affiliate
of the advisers acting either as principal or as broker.

PERFORMANCE INFORMATION

From time to time, the Fund may use hypothetical investment examples and
performance information in advertisements, shareholder reports or other
communications to shareholders. Because such performance information is based on
past investment results, it should not be considered as an indication or
representation of the performance of the Fund in the future. From time to time,
the performance and yield of the Fund may be quoted and compared to those of
other mutual funds with similar investment objectives, unmanaged investment
accounts, including savings accounts, or other similar products and to stock or
other relevant indices or to rankings prepared by independent services or other
financial or industry publications that monitor the performance of mutual funds.
For example, the performance of the Fund may be compared to data
prepared by Lipper Analytical Services, Inc. or Morningstar Mutual Funds on
Disc, widely recognized independent services which monitor the performance of
mutual funds. Performance and yield data as reported in national financial
publications including, but not limited to, Money Magazine, Forbes, Barron's,
The Wall Street Journal and The New York Times, or in local or regional
publications, may also be used in comparing the performance and yield of the
Fund. The Fund's performance may be compared with indices such as the Lehman
Brothers Government/Corporate Bond Index, the Lehman Brothers Government Bond
Index, the Lehman Government Bond 1-3 Year Index and the Lehman Aggregate Bond
Index; the S&P 500 Index, the Dow Jones Industrial Average or any other commonly
quoted index of common stock prices; and the Russell 2000 Index and the NASDAQ
Composite Index. Additionally, the Fund may, with proper authorization, reprint
articles written about the Fund and provide them to prospective shareholders.

The Fund may provide period and average annual "total rates of return." The
"total rate of return" refers to the change in the value of an investment in the
Fund over a period (which period shall be stated in any advertisement or
communication with a shareholder) based on any change in net asset value per
share including the value of any shares purchased through the reinvestment of
any dividends or capital gains distributions declared during such period.

Unlike some bank deposits or other investments which pay a fixed yield for a
stated period of time, the yields and the net asset values of shares of the Fund
will vary based on market conditions, the current market value of the securities
held by the Fund and changes in the Fund's expenses. The advisers, the
Administrator, the Distributor and other service providers may voluntarily waive
a portion of their fees on a month-to-month basis. In addition, the Distributor
may assume a portion of the Fund's operating expenses on a month-to-month basis.
These actions would have the effect of increasing the net income (and therefore
the yield and total rate of return) of shares of the Fund during the period such
waivers are in effect. These factors and possible differences in the methods
used to calculate the yields and total rates of return should be considered when
comparing the yields or total rates of return of shares of the Fund to yields
and total rates of return published for other investment companies and other
investment vehicles.

16
<PAGE>

Advertising or communications to shareholders may contain the views of the
advisers as to current market, economic, trade and interest rate trends, as well
as legislative, regulatory and monetary developments, and may include investment
strategies and related matters believed to be of relevance to the Fund.

Advertisements for the Fund may include references to the asset size of
other financial products made available by Chase, such as the offshore assets of
other funds.

Total Rate Of Return

The Fund's total rate of return for any period will be calculated by
(a) dividing (i) the sum of the net asset value per share on the last day of the
period and the net asset value per share on the last day of the period of shares
purchasable with dividends and capital gains declared during such period with
respect to a share held at the beginning of such period and with respect to
shares purchased with such dividends and capital gains distributions, by (ii)
the public offering price per share on the first day of such period, and (b)
subtracting 1 from the result. The average annual rate of return quotation will
be calculated by (x) adding 1 to the period total rate of return quotation as
calculated above, (y) raising such sum to a power which is equal to 365 divided
by the number of days in such period, and (z) subtracting 1 from the result.

The average annual total rate of return figures for the Fund, reflecting the
initial investment and reinvested dividends (but excluding the effects of any
applicable sales charges) for the one and five year periods ended October 31,
1995, and for the period from commencement of business operations of such Fund
to October 31, 1995, were as follows:

Date of
One Five Since Fund
Year Years Inception Inception
------ ----- --------- ---------

Vista Select Growth and Income Fund..... _____% _____% _____% 9/8/87

<PAGE>

Performance presented in the table above and in each table that follows for the
Fund is based upon the performance of the Portfolio for periods prior to its
commencement of operations. Performance data for the Portfolio prior to November
23, 1993 reflects the payment of fees under a distribution plan adopted pursuant
to Rule 12b-1 under the 1940 Act. PERFORMANCE PRESENTED FOR THIS FUND IS BASED
ON THE HISTORICAL EXPENSES AND PERFORMANCE OF THE PORTFOLIO AND DOES NOT REFLECT
THE CURRENT DISTRIBUTION, SERVICE AND/OR OTHER EXPENSES THAT AN INVESTOR WOULD
INCUR AS A HOLDER OF SHARES OF SUCH FUND.

The Fund may also from time to time include in advertisements or other
communications a total return figure that is not calculated according to the
formula set forth above in order to compare more accurately the performance of
the Fund with other measures of investment return.

Yield Quotations

Any current "yield" quotation for shares shall consist of an annualized
hypothetical yield, carried at least to the nearest hundredth of one percent,
based on a thirty calendar day period and shall be calculated by (a) raising to
the sixth power the sum of 1

<PAGE>

plus the quotient obtained by dividing the Fund's net investment income earned
during the period by the product of the average daily number of shares
outstanding during the period that were entitled to receive dividends and the
maximum offering price per share on the last day of the period, (b) subtracting
1 from the result, and (c) multiplying the result by 2.

The yield of the shares of the Fund for the thirty-day period ended October 31,
1995 were as follows:

Vista Select Growth and Income Fund ____%

Advertisements for the Fund may include references to the asset size of other
financial products made available by Chase, such as the offshore assets of other
funds advised by Chase.

Non-standardized Performance Results

The table below reflects the net change in the value of an assumed initial
investment of $10,000 in the Fund (excluding the effects of any applicable
sale charges) for the period from the commencement date of business for
such Fund through October 31, 1995. The values reflect an assumption that
capital gain distributions and income dividends, if any, have been invested in
additional shares. From time to time, the Fund may provide these performance
results in addition to the total rate of return quotations required by the
Securities and Exchange Commission. As discussed more fully in the Prospectus,
neither these performance results, nor total rate of return quotations, should
be considered as representative of the performance of the Fund in the future.
These factors and the possible differences in the methods used to calculate
performance results and total rates of return should be considered when
comparing such performance results and total rate of return quotations of the
Fund with those published for other investment companies and other investment
vehicles.

Value of Value of
Initial Capital Value of
$10,000 Gains Reinvested
Investment Distributions Dividends Total Value
---------- ------------- --------- -----------
<S> <C> <C> <C> <C>

Vista Select Growth and Income Fund...... $_________ $_________ $________ $_________
</TABLE>

19
<PAGE>

DETERMINATION OF NET ASSET VALUE

As of the date of this Statement of Additional Information, the New York Stock
Exchange is open for trading every weekday except for the following holidays:
New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day. In addition to the days listed
above (other than Good Friday), Chase is closed for business on the following
holidays: Martin Luther King Day, Columbus Day and Veteran's Day.

Equity securities in the Fund's or Portfolio's portfolio are valued at the last
sale price on the exchange on which they are primarily traded or on the NASDAQ
National Market System, or at the last quoted bid price for securities in which
there were no sales during the day or for other unlisted (over-the-counter)
securities not reported on the NASDAQ National Market System. Bonds and other
fixed income securities (other than short-term obligations, but including listed
issues) in the Fund's or Portfolio's portfolio are valued on the basis of
valuations furnished by a pricing service, the use of which has been approved by
the Board of Trustees. In making such valuations, the pricing service utilizes
both dealer-supplied valuations and electronic data processing techniques that
take into account appropriate factors such as institutional-size trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics and other market data, without exclusive reliance
upon quoted prices or exchange or over-the-counter prices, since such valuations
are believed to reflect more accurately the fair value of such securities.
Short-term obligations which mature in 60 days or less are valued at amortized
cost, which constitutes fair value as determined by the Board of Trustees.
Futures and option contracts that are traded on commodities or securities
exchanges are normally valued at the settlement price on the exchange on which
they are traded. Portfolio securities (other than short-term obligations) for
which there are no such quotations or valuations are valued at fair value as
determined in good faith by or at the direction of the Board of Trustees.

20
<PAGE>

Interest income on long-term obligations in the Fund's or Portfolio's portfolio
is determined on the basis of coupon interest accrued plus amortization of
discount (the difference between acquisition price and stated redemption price
at maturity) and premiums (the excess of purchase price over stated redemption
price at maturity). Interest income on short-term obligations is determined on
the basis of interest and discount accrued less amortization of premium.

PURCHASES AND REDEMPTIONS

The Fund has established certain procedures and restrictions, subject to change
from time to time, for purchase, redemption, and exchange orders, including
procedures for accepting telephone instructions and effecting automatic
investments and redemptions. The Fund's Transfer Agent may defer acting on a
shareholder's instructions until it has received them in proper form. In
addition, the privileges described in the Prospectus are not available until a
completed and signed account application has been received by the Transfer
Agent.

Subject to compliance with applicable regulations, the Fund has reserved the
right to pay the redemption price of its Shares, either totally or partially, by
a distribution in kind of readily marketable portfolio securities (instead of
cash). The securities so distributed would be valued at the same amount as that
assigned to them in calculating the net asset value for the shares being sold.
If a shareholder received a distribution in kind, the shareholder could incur
brokerage or other charges in converting the securities to cash. The Trust has
filed an election under Rule 18f-1 committing to pay in cash all redemptions by
a shareholder of record up to amounts specified by the rule (approximately
$250,000).
21
<PAGE>

TAX MATTERS

The following is only a summary of certain additional tax considerations
generally affecting the Fund and its shareholders that are not described in the
Fund's Prospectus. No attempt is made to present a detailed explanation of the
tax treatment of the Fund or its shareholders, and the discussions here and in
the Fund's Prospectus are not intended as substitutes for careful tax planning.

Qualification as a Regulated Investment Company

The Fund has elected to be taxed as a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). As a
regulated investment company, the Fund is not subject to federal income tax on
the portion of its net investment income (i.e., its investment company taxable
income, as that term is defined in the Code, without a deduction for dividends
paid) and net capital gain (i.e., the excess of net long-term capital gains over
net short-term capital losses) that it distributes to shareholders, provided
that it distributes at least 90% of its net investment income for the taxable
year (the "Distribution Requirement"), and satisfies certain other requirements
of the Code that are described below. Distributions by the Fund made during the
taxable year or, under specified circumstances, within twelve months after the
close of the taxable year, will be considered distributions of income and gains
of the taxable year and can therefore satisfy the Distribution Requirement.
Because the Fund invests all of its assets in the Portfolio which will be
classified as a partnership for federal income tax purposes, the Fund will be
deemed to own a proportionate share of the income of the Portfolio for purposes
of determining whether the Fund satisfies the Distribution Requirement and the
other requirements necessary to qualify as a regulated investment company (e.g.,
Income Requirement (hereinafter defined), etc.).

In addition to satisfying the Distribution Requirement, a regulated investment
company must: (1) derive at least 90% of its gross income from dividends,
interest, certain payments with respect to securities loans, gains from the sale
or other disposition of stock or securities or foreign currencies (to the extent
such currency gains are directly related to the regulated investment company's
principal business of investing in stock or securities) and other income
(including but not limited to gains from options, futures or forward contracts)
derived with respect to its business of investing in such stock, securities or
currencies (the "Income Requirement"); and (2) derive less than 30% of its gross
income (exclusive of certain gains on designated hedging transactions that are
offset by realized or unrealized losses on offsetting positions) from the sale
or other disposition of stock, securities or foreign currencies (or options,
futures

22
<PAGE>

or forward contracts thereon) held for less than three months (the "Short-Short
Gain Test"). However, foreign currency gains, including those derived from
options, futures and forwards, will not in any event be characterized as
Short-Short Gain if they are directly related to the regulated investment
company's investments in stock or securities (or options or futures thereon).
Because of the Short-Short Gain Test, the Fund may have to limit the sale of
appreciated securities that it has held for less than three months. However, the
Short-Short Gain Test will not prevent the Fund from disposing of investments at
a loss, since the recognition of a loss before the expiration of the three-month
holding period is disregarded for this purpose. Interest (including original
issue discount) received by the Fund at maturity or upon the disposition of a
security held for less than three months will not be treated as gross income
derived from the sale or other disposition of such security within the meaning
of the Short-Short Gain Test. However, income that is attributable to realized
market appreciation will be treated as gross income from the sale or other
disposition of securities for this purpose.

In general, gain or loss recognized by the Fund on the disposition of an asset
will be a capital gain or loss. However, gain recognized on the disposition of a
debt obligation purchased by the Fund at a market discount (generally, at a
price less than its principal amount) will be treated as ordinary income to the
extent of the portion of the market discount which accrued during the period of
time the Fund held the debt obligation.

Further, the Code also treats as ordinary income a portion of the capital gain
attributable to a transaction where substantially all of the return realized is
attributable to the time value of the Fund's net investment in the transaction
and: (1) the transaction consists of the acquisition of property by the Fund and
a contemporaneous contract to sell substantially identical property in the
future; (2) the transaction is a straddle within the meaning of Section 1092 of
the Code; (3) the transaction is one that was marketed or sold to the Fund on
the basis that it would have the economic characteristics of a loan but the
interest-like return would be taxed as capital gain; or (4) the transaction is
described as a conversion transaction in the Treasury Regulations. The amount of
the gain recharacterized generally will not exceed the amount of the interest
that would have accrued on the net investment for the relevant period at a yield
equal to 120% of the federal long-term, mid-term, or short-term rate, depending
upon the type of instrument at issue, reduced by an amount equal to: (1) prior
inclusions of ordinary income items from the conversion transaction; and (2) the
capitalized interest on acquisition indebtedness under Code Section 263(g).
Built-in losses will be preserved where the Fund has a built-in loss with
respect to property that becomes a part of a conversion transaction. No
authority exists that indicates that the converted character of the income will
not be passed to the Fund's shareholders.

In general, for purposes of determining whether capital gain or loss recognized
by the Fund on the disposition of an asset is long-term or short-term, the
holding period of the asset may be affected if: (1) the asset is used to close a
"short sale" (which includes for certain purposes the acquisition of a put
option) or is substantially identical to another asset so used, (2) the asset is
otherwise held by the Fund as part of a "straddle" (which term generally
excludes a situation where the asset is stock and the Fund grants a qualified
covered call option (which, among other things, must not be deep-in-the-money)
with respect thereto); or (3) the asset is stock and the Fund grants an in-the-
money qualified covered call option with respect thereto. However, for purposes
of the Short-Short Gain Test, the holding period of the asset disposed of may be
reduced only in the case of clause (1) above. In addition, the Fund may be
required to defer the recognition of a loss on the disposition of an asset held
as part of a straddle to the extent of any unrecognized gain on the offsetting
position.

Any gain recognized by the Fund on the lapse of, or any gain or loss recognized
by the Fund from a closing transaction with respect to, an option written by the
Fund will be treated as a short-term capital gain or loss. For purposes of the
Short-Short Gain Test, the holding period of an option written by the Fund will
commence on the date it is written and end on the date it lapses or the date a
closing transaction is entered into. Accordingly, the Fund may be limited in its
ability to write options which expire within three months and to enter into
closing transactions at a gain within three months of the writing of options.

Transactions that may be engaged in by the Fund (such as regulated futures
contracts, certain foreign currency contracts, and options on stock indexes and
futures contracts) will be subject to special tax treatment as "Section 1256
contracts." Section 1256 contracts are treated as if they are sold for their
fair market value on the last business day of the taxable year, even though a
taxpayer's obligations (or rights) under such contracts have not terminated (by
delivery, exercise, entering into a closing transaction or otherwise) as of such
date. Any gain or loss recognized as a consequence of the year-end deemed
disposition of Section 1256 contracts is taken into account for the taxable year
together with any other gain or loss that was previously recognized upon the
termination of Section 1256 contracts during that taxable year. Any capital gain
or loss for the taxable year with respect to Section 1256 contracts (including
any capital gain or loss arising as a consequence of the year-end deemed sale of
such contracts) is generally treated as 60% long-term capital gain or loss and
40% short-term capital gain or loss. The Fund, however, may elect not to have
this special tax treatment apply to Section 1256 contracts that are part of a
"mixed straddle" with other investments of the Fund that are not Section 1256
contracts. The Internal Revenue Service (the "IRS") has held in several private
rulings that gains arising from Section 1256 contracts will be treated for
purposes of the Short-Short Gain Test as being derived from securities held for
not less than three months if the gains arise as a result of a constructive sale
under Code Section 1256.

Treasury Regulations permit a regulated investment company, in determining its
investment company taxable income and net capital gain (i.e., the excess of net
long-term capital gain over net short-term capital loss) for any taxable year,
to elect (unless it has made a taxable year election for excise tax purposes as
discussed below) to treat all or any part of any net capital loss, any net
long-term capital loss or any net foreign currency loss incurred after October
31 as if it had been incurred in the succeeding year.

23
<PAGE>

In addition to satisfying the requirements described above, the Fund must
satisfy an asset diversification test in order to qualify as a regulated
investment company. Under this test, at the close of each quarter of the Fund's
taxable year, at least 50% of the value of the Fund's assets must consist of
cash and cash items, U.S. Government securities, securities of other regulated
investment companies, and securities of other issuers (as to which the Fund has
not invested more than 5% of the value of the Fund's total assets in securities
of such issuer and as to which the Fund does not hold more than 10% of the
outstanding voting securities of such issuer), and no more than 25% of the value
of its total assets may be invested in the securities of any one issuer (other
than U.S. Government securities and securities of other regulated investment
companies), or in two or more issuers which the Fund controls and which are
engaged in the same or similar trades or businesses. Generally, an option (call
or put) with respect to a security is treated as issued by the issuer of the
security not the issuer of the option. However, with regard to forward currency
contracts, there does not appear to be any formal or informal authority which
identifies the issuer of such instrument. For purposes of asset diversification
testing, obligations issued or guaranteed by agencies or instrumentality's of
the U.S. Government such as the Federal Agricultural Mortgage Corporation, the
Farm Credit System Financial Assistance Corporation, a Federal Home Loan Bank,
the Federal Home Loan Mortgage Association, the Government National Mortgage
Corporation, and the Student Loan Marketing Association are treated as U.S.
Government Securities.

If for any taxable year the Fund does not qualify as a regulated investment
company, all of its taxable income (including its net capital gain) will be
subject to tax at regular corporate rates without any deduction for
distributions to shareholders, and such distributions will be taxable to the
shareholders as ordinary dividends to the extent of the Fund's current and
accumulated earnings and profits. Such distributions generally will be eligible
for the dividends-received deduction in the case of corporate shareholders.

Excise Tax On Regulated Investment Companies

A 4% non-deductible excise tax is imposed on a regulated investment company that
fails to distribute in each calendar year an amount equal to 98% of ordinary
taxable income for the calendar year and 98% of capital gain net income for the
one-year period ended on October 31 of such calendar year (or, at the election
of a regulated investment company having a taxable year ending November 30 or
December 31, for its taxable year (a "taxable year election")). The balance of
such income must be distributed during the next calendar year. For the foregoing
purposes, a regulated investment company is treated as having distributed any
amount on which it is subject to income tax for any taxable year ending in such
calendar year.

For purposes of the excise tax, a regulated investment company shall: (1) reduce
its capital gain net income (but not below its net capital gain) by the amount
of any net ordinary loss for the calendar year; and (2) exclude foreign currency
gains and losses incurred after October 31 of any year (or after the end of its
taxable year if it has made a taxable year election) in determining the amount
of ordinary taxable income for the current calendar year (and, instead, include
such gains and losses in determining ordinary taxable income for the succeeding
calendar year).

The Fund intends to make sufficient distributions or deemed distributions of its
ordinary taxable income and capital gain net income prior to the end of each
calendar year to avoid liability for the excise tax. However, investors should
note that the Fund may in certain circumstances be required to liquidate
portfolio investments to make sufficient distributions to avoid excise tax
liability.

Fund Distributions

The Fund anticipates distributing substantially all of its investment company
taxable income for each taxable year. Such distributions will be taxable to
shareholders as ordinary income and treated as dividends for federal income tax
purposes, but they will qualify for the 70% dividends-received deduction for
corporations only to the extent discussed below.

The Fund may either retain or distribute to shareholders its net realized
capital gain for each taxable year. The Fund currently intends to distribute any
such amounts. If net capital gain is distributed and designated as a capital
gain dividend, it will be taxable to shareholders as long-term capital gain,
regardless of the length of time the shareholder has held his shares or whether
such gain was recognized by the Fund prior to the date on which the shareholder
acquired his shares.

Conversely, if the Fund elects to retain its net realized capital gain, the Fund
will be taxed thereon (except to the extent of any available capital loss
carryovers) at the 35% corporate tax rate. If the Fund elects to retain its net
capital gain, it is expected that the Fund also will elect to have shareholders
of record on the last day of its taxable year treated as if each received a
distribution of his pro rata share of such gain, with the result that each
shareholder will be required to report his pro rata share of such gain on his
tax return as long-term capital gain, will receive a refundable tax credit for
his pro rata share of tax paid by the Fund on the gain, and will increase the
tax basis for his shares by an amount equal to the deemed distribution less the
tax credit.

Ordinary income dividends paid by the Fund with respect to a taxable year will
qualify for the 70% dividends-received deduction generally available to
corporations to the extent of the amount of qualifying dividends received by the
Fund from domestic corporations

24
<PAGE>

for the taxable year. A dividend received by the Fund will not be treated as a
qualifying dividend (1) if it has been received with respect to any share of
stock that the Fund has held for less than 46 days (91 days in the case of
certain preferred stock), excluding for this purpose under the rules of Code
Section 246(c) (3) and (4): (i) any day more than 45 days (or 90 days in the
case of certain preferred stock) after the date on which the stock becomes
ex-dividend and (ii) any period during which the Fund has an option to sell, is
under a contractual obligation to sell, has made and not closed a short sale of,
is the grantor of a deep-in-the-money or otherwise nonqualified option to buy,
or has otherwise diminished its risk of loss by holding other positions with
respect to, such (or substantially identical) stock; (2) to the extent that the
Fund is under an obligation (pursuant to a short sale or otherwise) to make
related payments with respect to positions in substantially similar or related
property; or (3) to the extent the stock on which the dividend is paid is
treated as debt-financed under the rules of Code Section 246A. Moreover, the
dividends-received deduction for a corporate shareholder may be disallowed or
reduced (1) if the corporate shareholder fails to satisfy the foregoing
requirements with respect to its shares of the Fund or (2) by application of
Code Section 246(b) which in general limits the dividends-received deduction to
70% of the shareholder's taxable income (determined without regard to the
dividends-received deduction and certain other items). In the case where the
Fund invests all of its assets in the Portfolio and the Fund satisfies the
holding period rules pursuant to Code Section 246(c) as to its interest in the
Portfolio, a corporate shareholder which satisfies the foregoing requirements
with respect to its shares of the Fund should receive the dividends-received
deduction.

For purposes of the Corporate AMT and the environmental Superfund tax, the
corporate dividends-received deduction is not itself an item of tax preference
that must be added back to taxable income or is otherwise disallowed in
determining a corporation's AMT. However, corporate shareholders will generally
be required to take the full amount of any dividend received from the Fund into
account (without a dividends-received deduction) in determining its adjusted
current earnings.

Investment income that may be received by the Fund from sources within foreign
countries may be subject to foreign taxes withheld at the source. The United
States has entered into tax treaties with many foreign countries which entitle
the Fund to a reduced rate of, or exemption from, taxes on such income. It is
impossible to determine the effective rate of foreign tax in advance since the
amount of the Fund's assets to be invested in various countries is not known.

Distributions by the Fund that do not constitute ordinary income dividends, or
capital gain dividends will be treated as a return of capital to the extent of
(and in reduction of) the shareholder's tax basis in his shares; any excess will
be treated as gain from the sale of his shares, as discussed below.

Distributions by the Fund will be treated in the manner described above
regardless of whether such distributions are paid in cash or reinvested in
additional shares of the Fund (or of another fund). Shareholders receiving a
distribution in the form of additional shares will be treated as receiving a
distribution in an amount equal to the fair market value of the shares received,
determined as of the reinvestment date. In addition, if the net asset value at
the time a shareholder purchases shares of the Fund reflects undistributed net
investment income or recognized capital gain net income, or unrealized
appreciation in the value of the assets of the Fund, distributions of such
amounts will be taxable to the shareholder in the manner described above,
although such distributions economically constitute a return of capital to the
shareholder.

Ordinarily, shareholders are required to take distributions by the Fund into
account in the year in which the distributions are made. However, dividends
declared in October, November or December of any year and payable to
shareholders of record on a specified date in such a month will be deemed to
have been received by the shareholders (and made by the Fund) on December 31 of
such calendar year if such dividends are actually paid in January of the
following year. Shareholders will be advised annually as to the U.S. federal
income tax consequences of distributions made (or deemed made) during the year.

The Fund will be required in certain cases to withhold and remit to the U.S.
Treasury 31% of ordinary income dividends and capital gain dividends, and the
proceeds of redemption of shares, paid to any shareholder (1) who has provided
either an incorrect tax identification number or no number at all, (2) who is
subject to backup withholding by the IRS for failure to report the receipt of
interest or dividend income properly, or (3) who has failed to certify to the
Fund that it is not subject to backup withholding or that it is a corporation or
other "exempt recipient."

Sale or Redemption of Shares

A shareholder will recognize gain or loss on the sale or redemption of shares of
the Fund in an amount equal to the difference between the proceeds of the sale
or redemption and the shareholder's adjusted tax basis in the shares. All or a
portion of any loss so recognized may be disallowed if the shareholder purchases
other shares of the Fund within 30 days before or after the sale or redemption.
In general, any gain or loss arising from (or treated as arising from) the sale
or redemption of shares of the Fund will be considered capital gain or loss and
will be long- term capital gain or loss if the shares were held for longer than
one year. However, any capital loss arising from the sale or redemption of
shares held for six months or less will be disallowed to the extent of the
amount of exempt-interest dividends received on such shares and (to the extent
not disallowed) will be treated as a long-term capital loss to the extent of the
amount of capital gain dividends received on such shares. For this purpose, the
special holding period rules of Code Section 246(c)(3) and (4) (discussed above
in connection with the dividends-received deduction for corporations) generally
will apply in determining the holding period of shares. Long-term capital gains
of noncorporate taxpayers are currently taxed at a maximum rate

25
<PAGE>

11.6% lower than the maximum rate applicable to ordinary income. Capital losses
in any year are deductible only to the extent of capital gains plus, in the case
of a noncorporate taxpayer, $3,000 of ordinary income.

If a shareholder (1) incurs a sales load in acquiring shares of the Fund, (2)
disposes of such shares less than 91 days after they are acquired and (3)
subsequently acquires shares of the Fund or another fund at a reduced sales load
pursuant to a right to reinvest at such reduced sales load acquired in
connection with the acquisition of the shares disposed of, then the sales load
on the shares disposed of (to the extent of the reduction in the sales load on
the shares subsequently acquired) shall not be taken into account in determining
gain or loss on the shares disposed of but shall be treated as incurred on the
acquisition of the shares subsequently acquired.

Foreign Shareholders

Taxation of a shareholder who, as to the United States, is a nonresident alien
individual, foreign trust or estate, foreign corporation, or foreign partnership
("foreign shareholder"), depends on whether the income from the Fund is
"effectively connected" with a U.S. trade or business carried on by such
shareholder.

If the income from the Fund is not effectively connected with a U.S. trade or
business carried on by a foreign shareholder, ordinary income dividends paid to
a foreign shareholder will be subject to U.S. withholding tax at the rate of 30%
(or lower treaty rate) upon the gross amount of the dividend. Such a foreign
shareholder would generally be exempt from U.S. federal income tax on gains
realized on the sale of shares of the Fund, capital gain dividends and
exempt-interest dividends and amounts retained by the Fund that are designated
as undistributed capital gains.

If the income from the Fund is effectively connected with a U.S. trade or
business carried on by a foreign shareholder, then ordinary income dividends,
capital gain dividends, and any gains realized upon the sale of shares of the
Fund will be subject to U.S. federal income tax at the rates applicable to U.S.
citizens or domestic corporations.

In the case of foreign noncorporate shareholders, the Fund may be required to
withhold U.S. federal income tax at a rate of 31% on distributions that are
otherwise exempt from withholding tax (or taxable at a reduced treaty rate)
unless such shareholders furnish the Fund with proper notification of its
foreign status.

The tax consequences to a foreign shareholder entitled to claim the benefits of
an applicable tax treaty may be different from those described herein. Foreign
shareholders are urged to consult their own tax advisers with respect to the
particular tax consequences to them of an investment in the Fund, including the
applicability of foreign taxes.

Effect of Future Legislation; Local Tax Considerations

The foregoing general discussion of U.S. federal income tax consequences is
based on the Code and the Treasury Regulations issued thereunder as in effect on
the date of this Statement of Additional Information. Future legislative or
administrative changes or court decisions may significantly change the
conclusions expressed herein, and any such changes or decisions may have a
retroactive effect with respect to the transactions contemplated herein.

Rules of state and local taxation of ordinary income dividends and capital gain
dividends from regulated investment companies often differ from the rules for
U.S. federal income taxation described above. Shareholders are urged to consult
their tax advisers as to the consequences of these and other state and local tax
rules affecting investment in the Fund.

MANAGEMENT OF THE TRUST AND THE FUND OR PORTFOLIO

Trustees and Officers

The Trustees and officers of the Trust and their principal occupations for at
least the past five years are set forth below. Their titles may have varied
during that period.

Fergus Reid, III--Chairman of the Trust. Chairman and Chief Executive Officer,
Lumelite Corporation, since September 1985; Trustee, Morgan Stanley Funds. Age:
63. Address: 202 June Road, Stamford, CT 06903.

Richard E. Ten Haken--Trustee; Chairman of the Audit Committee. Formerly
District Superintendent of Schools, Monroe No. 2 and Orleans Counties, New York;
Chairman of the Board and President, New York State Teachers' Retirement System.
Age: 61. Address: 4 Barnfield Road, Pittsford, NY 14534.

William J. Armstrong--Trustee. Vice President and Treasurer, Ingersoll-Rand
Company. Age: 54. Address: 49 Aspen Way, Upper Saddle River, NJ 07458.

<PAGE>

John R.H. Blum--Trustee. Attorney in private practice; formerly, partner in the
law firm of Richards, O'Neil & Allegaert; Commissioner of Agriculture - State of
Connecticut, 1992-1995. Age: 66. Address: 322 Main Street, Lakeville, CT 06039.

Joseph J. Harkins--Trustee. Retired; Commercial Sector Executive and Executive
Vice President of The Chase Manhattan Bank, N.A. from 1985 through 1989. He has
been employed by Chase in numerous capacities and offices since 1954. Director
of Blessings Corporation, Jefferson Insurance Company of New York, Monticello
Insurance Company and National. Age: 64. Address: 257 Plantation Circle South,
Ponte Vedra Beach, FL 32082.

*H. Richard Vartabedian--Trustee and President of the Trust; Chairman of the
Portfolios. Consultant, Republic Bank of New York; formerly, Senior Investment
Officer, Division Executive of the Investment Management Division of The Chase
Manhattan Bank, N.A., 1980 through 1991. Age: 60. Address: P.O. Box 296, Beach
Road, Hendrick's Head, Southport, ME 04576.

Stuart W. Cragin, Jr.--Trustee. Retired; formerly President, Fairfield Testing
Laboratory, Inc. He has previously served in a variety of marketing,
manufacturing and general management positions with Union Camp Corp., Trinity
Paper & Plastics Corp., and Conover Industries. Age: 63. Address: 108 Valley
Road, Cos Cob, CT 06807.

Irving L. Thode--Trustee. Retired; formerly Vice President of Quotron Systems.
He has previously served in a number of executive positions with Control Data
Corp., including President of its Latin American Operations, and General Manager
of its Data Services business. Age: 64. Address: 80 Perkins Road, Greenwich, CT
06830.

*W. Perry Neff--Trustee. Independent Financial Consultant; Director of North
America Life Assurance Co., Petroleum & Resources Corp. and The Adams Express
Co.; Director and Chairman of The Hanover Funds, Inc.; Director, Chairman and
President of The Hanover Investment Funds, Inc. Age: 68. Address: RR 1 Box 102,
Weston, VT 05181.

Roland R. Eppley, Jr.--Trustee. Retired; formerly President and Chief Executive
Officer, Eastern States Bankcard Association Inc. (1971-1988); Director, Janel
Hydraulics, Inc.; Director of The Hanover Funds, Inc. Age: 63. Address: 105
Coventry Place, Palm Beach Gardens, FL 33418.

W.D. MacCallan--Trustee. Director of The Adams Express Co. and Petroleum &
Resources Corp.; formerly Chairman of the Board and Chief Executive Officer of
The Adams Express Co. and Petroleum & Resources Corp.; Director of The Hanover
Funds, Inc. and The Hanover Investment Funds, Inc. Age: 68. Address: 624 East
45th Street, Savannah, GA 31405

Martin R. Dean--Treasurer and Assistant Secretary. Associate Director,
Accounting Services, BISYS Fund Services; formerly Senior Manager, KPMG Peat
Marwick (1987-1994). Age: 32. Address: 3435 Stelzer Road, Columbus, OH 43219.

Ann E. Bergin--Secretary. First Vice President, BISYS Fund Services, Inc.;
formerly, Senior Vice President, Administration, Concord Financial Group
(1991-1995); Assistant Vice President, Dreyfus Service Corporation (1982-1991).
Age: 35. Address: 125 West 55th Street, New York, NY 10019.

* Asterisks indicate those Trustees that are "interested persons" (as defined in
the 1940 Act). Mr. Reid is not an interested person of the Trust's investment
advisers or principal underwriter, but may be deemed an interested person of the
Trust solely by reason of being an officer of the Trust.

The Board of Trustees of the Trust presently has an Audit Committee. The members
of the Audit Committee are Messrs. Ten Haken (Chairman), Blum, Cragin, Thode,
Armstrong, Harkins, Reid and Vartabedian. The function of the Audit Committee is
to recommend independent auditors and monitor accounting and financial matters.
The Audit Committee met two times during the fiscal year ended October 31, 1995.

The Board of Trustees of the Trust has established an Investment Committee. The
members of the Investment Committee are Messrs. Vartabedian (Chairman) and Reid,
as well as Leonard M. Spalding, President of Vista Capital Management. The
function of the Investment Committee is to review the investment management
process of the Trust.

Remuneration of Trustees and Certain Executive Officers:

Each Trustee is reimbursed for expenses incurred in attending each meeting of
the Board of Trustees or any committee thereof. Each Trustee who is not an
affiliate of the advisers is compensated for his or her services according to a
fee schedule which recognizes the fact that each Trustee also serves as a
Trustee of other investment companies advised by the advisers. Each Trustee
receives a fee, allocated among all investment companies for which the Trustee
serves, which consists of an annual retainer component and a meeting fee
component. Effective August 21, 1995, each Trustee of the Vista Funds receives a
quarterly retainer of $12,000 and an additional per meeting fee of $1,500.
Members of committees receive a meeting fee only if the committee meeting is
held on a day other than a day on which a regularly scheduled meeting is held.
Prior to August 21, 1995, the quarterly retainer was $9,000 and the per-meeting

27
<PAGE>

fee was $1,000. The Chairman of the Trustees and the Chairman of the Investment
Committee each receive a 50% increment over regular Trustee total compensation
for serving in such capacities for all the investment companies advised by the
adviser.

Set forth below is information regarding compensation paid or accrued by the
"Fund Complex" (as defined below), including the Trust, for the period
indicated:

28
<PAGE>

Pension or Total
Retirement Compensation
Benefits Accrued from
as Fund Expenses "Fund Complex"(1)
---------------- -----------------

Fergus Reid, III, .......... 0 $78,456.65
Trustee
Richard E. Ten Haken, ...... 0 52,304.39
Trustee
William J. Armstrong, ...... 0 52,304.39
Trustee
John R.H. Blum, ............ 0 51,304.37
Trustee
Joseph J. Harkins, ......... 0 52,304.39
Trustee
H. Richard Vartabedian, .... 0 74,804.44
Trustee
Stuart W. Cragin, Jr., ..... 0 52,304.39
Trustee
Irving L. Thode, ........... 0 52,304.39
Trustee
W. Perry Neff, Trustee ..... 0 0
Ronald R. Eppley, Jr., ..... 0 0
Trustee
W.D. MacCallan, Trustee .... 0 0

(1) Data reflects total compensation earned during the period January 1, 1995 to
December 31, 1995 for service as a Trustee to all Funds advised by the adviser.

Vista Funds Retirement Plan for Eligible Trustees. Effective August 21, 1995,
the Trustees also instituted a Retirement Plan for Eligible Trustees (the
"Plan") pursuant to which each Trustee (who is not an employee of any of the
Funds, the advisers administrator or distributor or any of their affiliates) may
be entitled to certain benefits upon retirement from the Board of Trustees.
Pursuant to the

29
<PAGE>
Plan, the normal retirement date is the date on which the eligible Trustee has
attained age 65 and has completed at least five years of continuous service with
one or more of the investment companies advised by the adviser (collectively,
the "Covered Funds"). Each Eligible Trustee is entitled to receive from the
Covered Funds an annual benefit commencing on the first day of the calendar
quarter coincident with or following his date of retirement equal to 10% of the
highest annual compensation received from the Covered Funds multiplied by the
number of such Trustee's years of service (not in excess of 10 years) completed
with respect to any of the Covered Funds. Such benefit is payable to each
eligible Trustee in monthly installments for the life of the Trustee.

Set forth below in the table are the estimated annual benefits payable to an
eligible Trustee upon retirement assuming various compensation and years of
service classifications. As of September 30, 1996, the estimated credited years
of service for Messrs. Reid, Ten Haken, Armstrong, Blum, Harkins, Vartabedian,
Cragin, Thode, Neft, Eppley and MacCallan are 11, 11, 8, 11, 5, 3, 3, 3, 6, 7
and 6, respectively.

Highest Annual Compensation Paid by All Vista Funds
------------------------------------------------------------
$40,000 $45,000 $50,000 $55,000

Years of
Service Estimated Annual Benefits upon Retirement
- ------------------- ------------------------------------------
10 ....... $40,000 $45,000 $50,000 $55,000
9 ........ 36,000 40,500 45,000 49,500
8 ........ 32,000 36,000 40,000 44,000
7 ........ 28,000 31,500 35,000 38,500
6 ........ 24,000 27,000 30,000 33,000
5 ........ 20,000 22,500 25,000 27,500

Effective August 21, 1995, the Trustees instituted a Deferred Compensation Plan
for Eligible Trustees (the "Deferred Compensation Plan") pursuant to which each
Trustee (who is not an employee of any of the Covered Funds, the advisers,
administrator or distributor or any of their affiliates) may enter into
agreements with the Covered Funds whereby payment of the Trustee's fees are
deferred until the payment date elected by the Trustee (or the Trustee's
termination of service). The deferred amounts are invested in shares of Vista
funds selected by the Trustee. The deferred amounts are paid out in a lump sum
or over a period of several years as elected by the Trustee at the time of
deferral. If a deferring Trustee dies prior to the distribution of amounts held
in the deferral account, the balance of the deferral account will be distributed
to the Trustee's designated beneficiary in a single lump sum payment as soon as
practicable after such deferring Trustee's death.

Messrs. Ten Haken, Thode and Vartabedian have each executed a deferred
compensation agreement for the 1996 calendar year and as of September 30, 1996
they had contributed $15,200, $39,500 and $59,250 respectively.

The Declaration of Trust provides that the Trust will indemnify its Trustees and
officers against liabilities and expenses incurred in connection with litigation
in which they may be involved because of their offices with the Trust, unless,
as to liability to the Trust or its shareholders, it is finally adjudicated that
they engaged in willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in their offices or with respect to any matter
unless it is finally adjudicated that they did not act in good faith in the
reasonable belief that their actions were in the best interest of the Trust. In
the case of settlement, such indemnification will not be provided unless it has
been determined by a court or other body approving the settlement or other
disposition, or by a reasonable determination based upon a review of readily
available facts, by vote of a majority of disinterested Trustees or in a written
opinion of independent counsel, that such officers or Trustees have not engaged
in willful misfeasance, bad faith, gross negligence or reckless disregard of
their duties.

As of October 15, 1996, the Trustees and officers as a group owned none of the
Fund's outstanding shares. For the fiscal year ended October 31, 1995, the Trust
paid its disinterested Trustees fees and expenses for all of the meetings of the
Board and any committees attended in the aggregate amount of approximately
$39,790 which amount is then apportioned between the funds comprising the Trust.

Adviser and Sub-adviser

Chase acts as investment adviser to the Portfolio pursuant to an Investment
Advisory Agreement, dated as of May 6, 1996 (the "Advisory Agreement"). Subject
to such policies as the Board of Trustees may determine, Chase is responsible
for investment decisions for the Portfolio. Pursuant to the terms of the
Advisory Agreement, Chase provides the Portfolio with such investment advice and
supervision as it deems necessary for the proper supervision of the Portfolio's
investments. The advisers continuously provide investment programs and determine
from time to time what securities shall be purchased, sold or exchanged and what
portion of the Portfolio's assets shall be held uninvested. The advisers to the
Portfolio furnish, at their own expense, all services, facilities and personnel
necessary in connection with managing the investments and effecting portfolio
transactions for the Portfolio. The Advisory Agreement for the Portfolio will
continue in effect from year

30
<PAGE>

to year only if such continuance is specifically approved at least annually by
the Board of Trustees or by vote of a majority of the Portfolio's outstanding
voting securities and by a majority of the Trustees who are not parties to the
Advisory Agreement or interested persons of any such party, at a meeting called
for the purpose of voting on such Advisory Agreement.

Under the Advisory Agreement, the adviser may utilize the specialized portfolio
skills of all its various affiliates, thereby providing the Portfolio with
greater opportunities and flexibility in accessing investment expertise.

Pursuant to the terms of the Advisory Agreement and the sub-adviser's agreement
with the adviser, the adviser and sub-adviser are permitted to render services
to others. Each advisory agreement is terminable without penalty by the
Portfolio on not more than 60 days', nor less than 30 days', written notice when
authorized either by a majority vote of a Portfolio's shareholders or by a vote
of a majority of the Board of Trustees of the Portfolio, or by the adviser or
sub-adviser on not more than 60 days', nor less than 30 days', written notice,
and will automatically terminate in the event of its "assignment" (as defined in
the 1940 Act). The advisory agreements provide that the adviser or sub-adviser
under such agreement shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission in
the execution of portfolio transactions for the Portfolio, except for wilful
misfeasance, bad faith or gross negligence in the performance of its duties, or
by reason of reckless disregard of its obligations and duties thereunder.

The equity research team of the adviser looks for two key variables when
analyzing stocks for potential investment by equity portfolios: value and
momentum. To uncover these qualities, the team uses a combination of
quantitative analysis, fundamental research and computer technology to help
identify undervalued stocks.

In the event the operating expenses of the Fund, including all investment
advisory, administration and sub-administration fees, but excluding brokerage
commissions and fees, taxes, interest and extraordinary expenses such as
litigation, for any fiscal year exceed the most restrictive expense limitation
applicable to the Fund imposed by the securities laws or regulations thereunder
of any state in which the shares of the Fund are qualified for sale, as such
limitations may be raised or lowered from time to time, the adviser shall reduce
its advisory fee (which fee is described below) to the extent of its share of
such excess expenses. The amount of any such reduction to be borne by the
adviser shall be deducted from the monthly advisory fee otherwise payable with
respect to the Fund during such fiscal year; and if such amounts should exceed
the monthly fee, the adviser shall pay to the Fund its share of such excess
expenses no later than the last day of the first month of the next succeeding
fiscal year.

Under the Advisory Agreement, Chase may delegate a portion of its
responsibilities to a sub-adviser. In addition, the Advisory Agreement provides
that Chase may render services through its own employees or the employees of one
or more affiliated companies that are qualified to act as an investment adviser
of the Portfolio and are under the common control of Chase as long as all such
persons are functioning as part of an organized group of persons, managed by
authorized officers of Chase.

Chase, on behalf of the Portfolio, has entered into an investment sub-advisory
agreement dated as of May 6, 1996 with Chase Asset Management, Inc. ("CAM").
With respect to the day-to-day management of the Portfolio, under the
sub-advisory agreement, the sub-adviser makes decisions concerning, and places
all orders for, purchases and sales of securities and helps maintain the records
relating to such purchases and sales. The sub-adviser may, in its discretion,
provide such services through its own employees or the employees of one or more
affiliated companies that are qualified to act as an investment adviser to the
Company under applicable laws and are under the common control of Chase;
provided that (i) all persons, when providing services under the sub-advisory
agreement, are functioning as part of an organized group of persons, and (ii)
such organized group of persons is managed at all times by authorized officers
of the sub-adviser. This arrangement will not result in the payment of
additional fees by the Portfolio.

Chase, a wholly-owned subsidiary of The Chase Manhattan Corporation, a
registered bank holding company, is a commercial bank offering a wide range of
banking and investment services to customers throughout the United States and
around the world. Also included among Chase's accounts are commingled trust
funds and a broad spectrum of individual trust and investment management
portfolios. These accounts have varying investment objectives.

CAM is a wholly-owned operating subsidiary of the Adviser. CAM is registered
with the Securities and Exchange Commission as an investment adviser and was
formed for the purpose of providing discretionary investment advisory services
to institutional clients and to consolidate Chase's investment management
function, and the same individuals who serve as portfolio managers for CAM also
serve as portfolio managers for Chase.

31
<PAGE>

In consideration of the services provided by the adviser pursuant to the
Advisory Agreement, the adviser is entitled to receive from the Portfolio an
investment advisory fee computed daily and paid monthly based on a rate equal to
a percentage of the Portfolio's average daily net assets specified in the
relevant Prospectuses. However, the adviser may voluntarily agree to waive a
portion of the fees payable to it on a month-to-month basis. For its services
under its sub-advisory agreement, CAM will be entitled to receive, with respect
to the Portfolio, such compensation, payable by the adviser out of its advisory
fee, as is described in the relevant Prospectuses.

With respect to the Growth and Income Portfolio, for the period November 23,
1993 to October 31, 1994, Chase was paid or accrued investment advisory fees of
$4,805,067. For the fiscal year ended October 31, 1995, Chase was paid or
accrued investment advisory fees of $6,815,197 with respect to the Portfolio.

Administrator

Pursuant to separate Administration Agreements (the "Administration
Agreements"), Chase is the administrator of the Fund and the administrator of
the Portfolio. Chase provides certain administrative services to the Fund and
Portfolio, including, among other responsibilities, coordinating the negotiation
of contracts and fees with, and the monitoring of performance and billing of,
the Fund's and Portfolio's independent contractors and agents; preparation for
signature by an officer of the Trust and Portfolio of all documents required to
be filed for compliance by the Trust and Portfolio with applicable laws and
regulations excluding those of the securities laws of various states; arranging
for the computation of performance data, including net asset value and yield;
responding to shareholder inquiries; and arranging for the maintenance of books
and records of the Fund and Portfolio and providing, at its own expense, office
facilities, equipment and personnel necessary to carry out its duties. Chase in
its capacity as administrator does not have any responsibility or authority for
the management of the Fund or Portfolio, the determination of investment policy,
or for any matter pertaining to the distribution of Fund shares.

Under the Administration Agreements Chase is permitted to render administrative
services to others. The Administration Agreements will continue in effect from
year to year with respect to the Fund or Portfolio only if such continuance is
specifically approved at least annually by the Board of Trustees of the Trust or
Portfolio or by vote of a majority of such Fund's or Portfolio's outstanding
voting securities and, in either case, by a majority of the Trustees who are not
parties to the Administration Agreements or "interested persons" (as defined in
the 1940 Act) of any such party. The Administration Agreements are terminable
without penalty by the Trust on behalf of the Fund or by the Portfolio on 60
days' written notice when authorized either by a majority vote of the Fund's or
Portfolio shareholders or by vote of a majority of the Board of Trustees,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust or Portfolio, or by Chase on 60 days'
written notice, and will automatically terminate in the event of their
"assignment" (as defined in the 1940 Act). The Administration Agreements also
provide that neither

32
<PAGE>

Chase or its personnel shall be liable for any error of judgment or mistake of
law or for any act or omission in the administration of the Fund or Portfolio,
except for willful misfeasance, bad faith or gross negligence in the performance
of its or their duties or by reason of reckless disregard of its or their
obligations and duties under the Administration Agreements.

In addition, the Administration Agreements provide that, in the event the
operating expenses of the Fund or Portfolio, including all investment advisory,
administration and sub-administration fees, but excluding brokerage commissions
and fees, taxes, interest and extraordinary expenses such as litigation, for any
fiscal year exceed the most restrictive expense limitation applicable to the
Fund imposed by the securities laws or regulations thereunder of any state in
which the shares of the Fund are qualified for sale, as such limitations may be
raised or lowered from time to time, Chase shall reduce its administration fee
(which fee is described below) to the extent of its share of such excess
expenses. The amount of any such reduction to be borne by Chase shall be
deducted from the monthly administration fee otherwise payable to Chase during
such fiscal year, and if such amounts should exceed the monthly fee, Chase shall
pay to such Fund or Portfolio its share of such excess expenses no later than
the last day of the first month of the next succeeding fiscal year.

In consideration of the services provided by Chase pursuant to the
Administration Agreements, Chase receives from the Fund and the Portfolio a fee
computed daily and paid monthly at an annual rate equal to 0.05% of their
respective average daily net assets. Chase may voluntarily waive a portion of
the fees payable to it with respect to the Fund on a month-to-month basis.

33
<PAGE>

Distribution and Sub-administration Agreement

The Trust has entered into a Distribution and Sub-Administration Agreement dated
August 24, 1995, (the "Distribution Agreement") with the Distributor, pursuant
to which the Distributor acts as the Fund's exclusive underwriter, provides
certain administration services and promotes and arranges for the sale of
Shares. The Distributor is a wholly-owned subsidiary of BISYS Fund Services,
Inc. The Distribution Agreement provides that the Distributor will bear the
expenses of printing, distributing and filing prospectuses and statements of
additional information and reports used for sales purposes, and of preparing and
printing sales literature and advertisements not paid for by the Distribution
Plan. The Trust pays for all of the expenses for qualification of the shares of
each Fund for sale in connection with the public offering of such shares, and
all legal expenses in connection therewith. In addition, pursuant to the
Distribution Agreement, the Distributor provides certain sub-administration
services to the Trust, including providing officers, clerical staff and office
space.

The Distribution Agreement is currently in effect and will continue in effect
with respect to the Fund only if such continuance is specifically approved at
least annually by the Board of Trustees or by vote of a majority of the Fund's
outstanding voting securities and, in either case, by a majority of the Trustees
who are not parties to the Distribution Agreement or "interested persons" (as
defined in the 1940 Act) of any such party. The Distribution Agreement is
terminable without penalty by the Trust on behalf of the Fund on 60 days'
written notice when authorized either by a majority vote of the Fund's
shareholders or by vote of a majority of the Board of Trustees of the Trust,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust, or by the Distributor on 60 days' written
notice, and will automatically terminate in the event of its "assignment" (as
defined in the 1940 Act). The Distribution Agreement also provides that neither
the Distributor nor its personnel shall be liable for any act or omission in the
course of, or connected with, rendering services under the Distribution
Agreement, except for willful misfeasance, bad faith, gross negligence or
reckless disregard of its obligations or duties.

In the event the operating expenses of the Fund, including all investment
advisory, administration and sub-administration fees, but excluding brokerage
commissions and fees, taxes, interest and extraordinary expenses such as
litigation, for any fiscal year exceed the most restrictive expense limitation
applicable to the Fund imposed by the securities laws or regulations thereunder
of any state in which the shares of the Fund are qualified for sale, as such
limitations may be raised or lowered from time to time, the Distributor shall
reduce its sub-administration fee with respect to the Fund (which fee is
described below) to the extent of its share of such excess expenses. The amount
of any such reduction to be borne by the Distributor shall be deducted from the
monthly sub-administration fee otherwise payable with respect to the Fund during
such fiscal year; and if such amounts should exceed the monthly fee, the
Distributor shall pay to the Fund its share of such excess expenses no later
than the last day of the first month of the next succeeding fiscal year.

In consideration of the sub-administration services provided by the Distributor
pursuant to the Distribution Agreement, the Distributor receives an annual fee,
payable monthly, of 0.05% of the net assets of the Fund. However, the
Distributor has voluntarily agreed to waive a portion of the fees payable to it
under the Distribution Agreement with respect to the Fund on a month-to-month
basis.

<PAGE>

Transfer Agent and Custodian

<PAGE>

The Trust has also entered into a Transfer Agency Agreement with DST Systems,
Inc. ("DST") pursuant to which DST acts as transfer agent for the Trust. DST's
address is 210 West 10th Street, Kansas City, MO 64105.

Pursuant to a Custodian Agreement, Chase acts as the custodian of the assets of
the Fund and receives such compensation as is from time to time agreed upon by
the Trust and Chase. As custodian, Chase provides oversight and record keeping
for the assets held in the portfolios of the Fund. Chase also provides fund
accounting services for the income, expenses and shares outstanding for the
Fund. Chase is located at 3 Metrotech Center, Brooklyn, NY 11245.

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP, 1177 Avenue of the Americas, New York, New York 10036,
independent accountants of the Fund, provides the Fund with audit services, tax
return preparation and assistance and consultation with respect to the
preparation of filings with the Securities and Exchange Commission.

GENERAL INFORMATION

Description of Shares, Voting Rights and Liabilities

Mutual Fund Group is an open-end, non-diversified management investment company
organized as Massachusetts business trust under the laws of the Commonwealth of
Massachusetts in 1987. The Trust currently consists of 18 series of shares of
beneficial interest, par value $.001 per share. The Trust has reserved the right
to create and issue additional series or classes. Each share of a series or
class represents an equal proportionate interest in that series or class with
each other share of that series or class. The shares of each series or class
participate equally in the earnings, dividends and assets of the particular
series or class. Expenses of the Trust which are not attributable to a specific
series or class are allocated among all the series in a manner believed by
management of the Trust to be fair and equitable. Shares have no pre-emptive or
conversion rights. Shares when issued are fully paid and non-assessable, except
as set forth below. Shareholders are entitled to one vote for each share held.
Shares of each series or class generally vote together, except when required
under federal securities laws to vote separately on matters that only affect a
particular class, such as the approval of distribution plans for a particular
class.

The Fund currently issues a single class of shares but may, in the future, offer
other classes of shares. The categories of investors that are eligible to
purchase shares may be different for each class of Fund shares. Other classes of
shares may be subject to differences in sales charge arrangements, ongoing
distribution and service fee levels, and levels of certain other expenses, which
will affect the relative performance of the different classes.

37
<PAGE>

Any person entitled to receive compensation for selling or servicing shares of
the Fund may receive different levels of compensation for selling one particular
class of shares rather than another.

The Trust is not required to hold annual meetings of shareholders but will hold
special meetings of shareholders of a series or class when, in the judgment of
the Trustees, it is necessary or desirable to submit matters for a shareholder
vote. Shareholders have, under certain circumstances, the right to communicate
with other shareholders in connection with requesting a meeting of shareholders
for the purpose of removing one or more Trustees. Shareholders also have, in
certain circumstances, the right to remove one or more Trustees without a
meeting. No material amendment may be made to the Trust's Declaration of Trust
without the affirmative vote of the holders of a majority of the outstanding
shares of each portfolio affected by the amendment. Shares have no preemptive or
conversion rights. Shares, when issued, are fully paid and non-assessable,
except as set forth below. Any series or class may be terminated (i) upon the
merger or consolidation with, or the sale or disposition of all or substantially
all of its assets to, another entity, if approved by the vote of the holders of
two-thirds of its outstanding shares, except that if the Board of Trustees
recommends such merger, consolidation or sale or disposition of assets, the
approval by vote of the holders of a majority of the series' or class'
outstanding shares will be sufficient, or (ii) by the vote of the holders of a
majority of its outstanding shares, or (iii) by the Board of Trustees by written
notice to the series' or class' shareholders. Unless each series and class is so
terminated, the Trust will continue indefinitely.

Under Massachusetts law, shareholders of a business trust may, under certain
circumstances, be held personally liable as partners for its obligations.
However, the Trust's Declaration of Trust contains an express disclaimer of
shareholder liability for acts or obligations of the Trust and provides for
indemnification and reimbursement of expenses out of the Trust property for any
shareholder held personally liable for the obligations of the Trust. The Trust's
Declaration of Trust also provides that the Trust shall maintain appropriate
insurance (for example, fidelity bonding and errors and omissions insurance) for
the protection of the Trust, its shareholders, Trustees, officers, employees and
agents covering possible tort and other liabilities. Thus, the risk of a
shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which both inadequate insurance existed and the
Trust itself was unable to meet its obligations.

The Trust's Declaration of Trust further provides that obligations of the Trust
are not binding upon the Trustees individually but only upon the property of the
Trust and that the Trustees will not be liable for any action or failure to act,
errors of judgment or mistakes of fact or law, but nothing in the Declaration of
Trust protects a Trustee against any liability to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the conduct of his office.

The Board of Trustees has adopted a code of ethics addressing personal
securities transactions by investment personnel and access persons and other
related matters. The code has been designed to address potential conflicts of
interest that can arise in connection with the personal trading activities of
such persons. Persons subject to the code are generally permitted to engage in
personal securities transactions, subject to certain prohibitions, pre-clearance
requirements and blackout periods.

<PAGE>

Principal Holders

As of March 31, 1996, no person owned of record 5% or more of the
outstanding shares of the Fund.

39
<PAGE>

APPENDIX A

DESCRIPTION OF CERTAIN OBLIGATIONS
ISSUED OR GUARANTEED BY U.S. GOVERNMENT
AGENCIES OR INSTRUMENTALITIES

Federal Farm Credit System Notes and Bonds--are bonds issued by a
cooperatively owned nationwide system of banks and associations supervised by
the Farm Credit Administration, an independent agency of the U.S. Government.
These bonds are not guaranteed by the U.S. Government.

Maritime Administration Bonds--are bonds issued and provided by the Department
of Transportation of the U.S. Government are guaranteed by the U.S. Government.

FNMA Bonds--are bonds guaranteed by the Federal National Mortgage Association.
These bonds are not guaranteed by the U.S. Government.

FHA Debentures--are debentures issued by the Federal Housing Administration of
the U.S. Government and are guaranteed by the U.S. Government.

FHA Insured Notes--are bonds issued by the Farmers Home Administration of the
U.S. Government and are guaranteed by the U.S. Government.

GNMA Certificates--are mortgage-backed securities which represent a partial
ownership interest in a pool of mortgage loans issued by lenders such as
mortgage bankers, commercial banks and savings and loan associations. Each
mortgage loan included in the pool is either insured by the Federal Housing
Administration or guaranteed by the Veterans Administration and therefore
guaranteed by the U.S. Government. As a consequence of the fees Paid to GNMA and
the issuer of GNMA Certificates, the coupon rate of interest of GNMA
Certificates is lower than the interest paid on the VA-guaranteed or FHA-insured
mortgages underlying the Certificates. The average life of a GNMA Certificate is
likely to be substantially less than the original maturity of the mortgage pools
underlying the securities. Prepayments of principal by mortgagors and mortgage
foreclosures may result in the return of the greater part of principal invested
far in advance of the maturity of the mortgages in the pool. Foreclosures impose
no risk to principal investment because of the GNMA guarantee. As the prepayment
rate of individual mortgage pools will vary widely, it is not possible to
accurately predict the average life of a particular issue of GNMA Certificates.
The yield which will be earned on GNMA Certificates may vary from their coupon
rates for the following reasons: (i) Certificates may be issued at a premium or
discount, rather than at par; (ii) Certificates may trade in the secondary
market at a premium or discount after issuance; (iii) interest is earned and
compounded monthly which has the effect of raising the effective yield earned on
the Certificates; and (iv) the actual yield of each Certificate is affected by
the prepayment of mortgages included in the mortgage pool underlying the
Certificates. Principal which is so prepaid will be reinvested although possibly
at a lower rate. In addition, prepayment of mortgages included in the mortgage
pool underlying a GNMA Certificate purchased at a premium could result in a loss
to a Fund. Due to the large amount of GNMA Certificates outstanding and active
participation in the secondary market by securities dealers and investors, GNMA
Certificates are highly liquid instruments. Prices of GNMA Certificates are
readily available from securities dealers and depend on, among other things, the
level of market rates, the Certificate's coupon rate and the prepayment
experience of the pool of mortgages backing each Certificate. If agency
securities are purchased at a premium above principal, the premium is not
guaranteed by the issuing agency and a decline in the market value to par may
resultin a loss of the premium, which may be particularly likely in the event of
a prepayment. When and if available, U.S. Government obligations may be
purchased at a discount from face value.

FHLMC Certificates and FNMA Certificates--are mortgage-backed bonds issued by
the Federal Home Loan Mortgage Corporation and the Federal National Mortgage
Association, respectively, and are guaranteed by the U.S. Government.

GSA Participation Certificates--are participation certificates issued by the
General Services Administration of the U.S. Government and are guaranteed by the
U.S. Government.

New Communities Debentures--are debentures issued in accordance with the
provisions of Title IV of the Housing and Urban Development Act of 1968, as
supplemented and extended by Title VII of the Housing and Urban Development Act
of 1970, the payment of which is guaranteed by the U.S. Government.

Public Housing Bonds--are bonds issued by public housing and urban renewal
agencies in connection with programs administered by the Department of Housing
and Urban Development of the U.S. Government, the payment of which is secured by
the U.S. Government.

Penn Central Transportation Certificates--are certificates issued by Penn
Central Transportation and guaranteed by the U.S. Government.

<PAGE>

SBA Debentures--are debentures fully guaranteed as to principal and interest by
the Small Business Administration of the U.S. Government.

Washington Metropolitan Area Transit Authority Bonds--are bonds issued by the
Washington Metropolitan Area Transit Authority. Some of the bonds issued prior
to 1993 are guaranteed by the U.S. Government.

FHLMC Bonds--are bonds issued and guaranteed by the Federal Home Loan Mortgage
Corporation. These bonds are not guaranteed by the U.S. Government.

Federal Home Loan Bank Notes and Bonds--are notes and bonds issued by the
Federal Home Loan Bank System and are not guaranteed by the U.S. Government.

Student Loan Marketing Association ("Sallie Mae") Notes and bonds--are notes and
bonds issued by the Student Loan Marketing Association and are not guaranteed by
the U.S. Government.

D.C. Armory Board Bonds--are bonds issued by the District of Columbia Armory
Board and are guaranteed by the U.S. Government.

Export-Import Bank Certificates--are certificates of beneficial interest and
participation certificates issued and guaranteed by the Export-Import Bank of
the U.S. and are guaranteed by the U.S. Government.

In the case of securities not backed by the "full faith and credit" of the U.S.
Government, the investor must look principally to the agency issuing or
guaranteeing the obligation for ultimate repayment, and may not be able to
assert a claim against the U.S. Government itself in the event the agency or
instrumentality does not meet its commitments.

Investments may also be made in obligations of U.S. Government agencies or
instrumentalities other than those listed above.

<PAGE>

APPENDIX B

DESCRIPTION OF RATINGS

A description of the rating policies of Moody's, S&P and Fitch with respect to
bonds and commercial paper appears below.

Moody's Investors Service's Corporate Bond Ratings

Aaa--Bonds which are rated "Aaa" are judged to be of the best quality and
carry the smallest degree of investment risk. 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 are generally known as
high grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as 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 qualities 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 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 thereby not well safeguared
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 a desirable
investment. Assurance of interest and principal payments or of maintenance and
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" represent obligations which are speculative in
high degree.

Such issues are often in default or have other marked shortcomings.

C--Bonds which are rated "C" are the lowest rated class of bonds and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

Moody's applies numerical modifiers "1", "2", and "3" to certain of its rating
classifications. The modifier "1" indicates that the security ranks in the
higher end of its generic rating category; the modifier "2" indicates a
mid-range ranking; and the modifier "3" indicates that the issue ranks in the
lower end of its generic rating category.

Standard & Poor's Ratings Group Corporate Bond Ratings

AAA--This is the highest rating assigned by Standard & Poor's to a debt
obligation and indicates an extremely strong capacity to repay principal and pay
interest.

AA--Bonds rated "AA" also qualify as high quality debt obligations. Capacity to
pay principal and interest is very strong, and differs from "AAA" issues only in
small degree.

A--Bonds rated "A" have a strong capacity to repay principal and pay interest,
although they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB--Bonds rated "BBB" are regarded as having an adequate capacity to repay
principal and pay interest. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to repay principal and pay interest for
bonds in this category than for higher rated categories.

<PAGE>
BB-B-CCC-CC-C--Bonds rated "BB", "B", "CCC", "CC" and "C" are regarded, on
balance, as predominantly speculative with respect to the issuer's capacity to
pay interest and repay principal in accordance with the terms of the
obligations. BB indicates the lowest degree of speculation and C 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.

CI--Bonds rated "CI" are income bonds on which no interest is being paid.

D--Bonds rated "D" are in default. The "D" category is used when interest
payments or principal payments are not made on the date due even if the
applicable grace period has not expired unless S&P believes that such payments
will be made during such grace period. The "D" rating is also used upon the
filing of a bankruptcy petition if debt service payments are jeopardized.

The ratings set forth above may be modified by the addition of a plus or minus
to show relative standing within the major rating categories.

Moody's Investors Service's Commercial Paper Ratings

Prime-1--Issuers (or related supporting institutions) rated "Prime-1" have a
superior ability for repayment of senior short-term debt obligations. "Prime-1"
repayment ability will often be evidenced by many of the following
characteristics: 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.

Prime-2--Issuers (or related supporting institutions) rated "Prime-2" have a
strong ability for repayment of senior short-term debt obligations. This will
normally 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 alternative liquidity is maintained.
Prime-3--Issuers (or related supporting institutions) rated "Prime-3" have an
acceptable ability for repayment of senior short-term obligations. The effect of
industry characteristics and market compositions may be more pronounced.
Variability in earnings and profitability may result in changes in the level of
debt protection measurements and the requirement for relatively high financial
leverage. Adequate alternate liquidity is maintained.

Not Prime--Issuers rated "Not Prime" do not fall within any of the Prime rating
categories.

Standard & Poor's Ratings Group Commercial Paper Ratings

A S&P commercial paper rating is current assessment of the likelihood of timely
payment of debt having an original maturity of no more than 365 days. Ratings
are graded in several categories, ranging from "A-1" for the highest quality
obligations to "D" for the lowest. The four categories are as follows:

A-1--This highest category indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus (+) sign designation.

A-2--Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1".

A-3--Issues carrying this designation have adequate capacity for timely payment.
They are, however, somewhat more vulnerable to the adverse effects of changes in
circumstances than obligations carrying the higher designations.

B--Issues rated "B" are regarded as having only speculative capacity for timely
payment.

C--This rating is assigned to short-term debt obligations with a doubtful
capacity for payment.

D--Debt rated "D" is in payment default. The "D" rating category is used when
interest payments or principal payments are not made on the date due, even if
the applicable grace period has not expired, unless S&P believes that such
payments will be made during such grace period.

Fitch Bond Ratings

AAA--Bonds rated AAA by Fitch are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to pay
interest and repay principal, which is unlikely to be affected by reasonably
foreseeable events.

AA--Bonds rated AA by Fitch are considered to be investment grade and of very
high credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because bonds
rated in the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issues is generally
rated F-1+ by Fitch.
43
<PAGE>
A--Bonds rated A by Fitch are considered to be investment grade and of high
credit quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.

BBB--Bonds rated BBB by Fitch are considered to be investment grade and of
satisfactory credit quality. The obligor's ability to pay interest and repay
principal is considered to be adequate. Adverse changes in economic conditions
and circumstances, however, are more likely to have adverse consequences on
these bonds, and therefore impair timely payment. The likelihood that the
ratings of these bonds will fall below investment grade is higher than for bonds
with higher ratings. Plus and minus signs are used by Fitch to indicate the
relative position of a credit within a rating category. Plus and minus signs,
however, are not used in the AAA category.

Fitch Short-Term Ratings

Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of generally up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal and
investment notes.

The short-term rating places greater emphasis than a long-term rating on the
existence of liquidity necessary to meet the issuer's obligations in a timely
manner.

Fitch's short-term ratings are as follows:

F-1+--Issues assigned this rating are regarded as having the strongest degree of
assurance for timely payment.

F-1--Issues assigned this rating reflect an assurance of timely payment only
slightly less in degree than issues rated F-1+.

F-2--Issues assigned this rating have a satisfactory degree of assurance for
timely payment but the margin of safety is not as great as for issues assigned
F-1+ and F-1 ratings.

F-3--Issues assigned this rating have characteristics suggesting that the degree
of assurance for timely payment is adequate, although near-term adverse changes
could cause these securities to be rated below investment grade.

LOC--The symbol LOC indicates that the rating is based on a letter of credit
issued by a commercial bank.

Like higher rated bonds, bonds rated in the Baa or BBB categories are considered
to have adequate capacity to pay principal and interest. However, such bonds may
have speculative characteristics, and changes in economic conditions or other
circumstances are more likely to lead to a weakened capacity to make principal
and interest payments than is the case with higher grade bonds.

After purchase by the Fund, a security may cease to be rated or its rating may
be reduced below the minimum required for purchase by the Fund. Neither event
will require a sale of such security by the Fund. However, the Fund's investment
manager will consider such event in its determination of whether the Fund should
continue to hold the security. To the extent the ratings given by Moody's, S&P
or Fitch may change as a result of changes in such organizations or their rating
systems, the Fund will attempt to use comparable ratings as standards for
investments in accordance with the investment policies contained in this
Prospectus and in the Statement of Additional Information.

<PAGE>

PART C

<PAGE>

MUTUAL FUND GROUP
PART C. OTHER INFORMATION

ITEM 24. Financial Statements and Exhibits

(a) Financial statements

In Part A: Financial Highlights (incorporated by
reference to the Registrant's filing of
definitive Prospectuses under Rule 497(c) of
the Securities Act on May 9, 1996, and the
Registrant's filing of a Prospectus Supplement
for the Vista European Fund, Vista Southeast
Asian Fund and Vista Japan Fund on May 30,
1996).

In Part B: Financial Statements and the Reports thereon
for the Funds filed herein, other than Vista
U.S. Government Securities Fund, Vista
American Value Fund, Vista European Fund,
Vista Japan Fund and Vista Southeast Asian
Fund for the fiscal year ended October 31,
1995 are incorporated by reference into Part B
as part of the 1995 Annual Reports to
Shareholders for such Funds as filed with the
Securities and Exchange Commission by Mutual
Fund Group on Form N-30D on December 29, 1995,
accession number 0000950123-95-003915, which
are incorporated into Part B by reference.
Financial Statements and the Reports thereon
for The Hanover U.S. Government Securities
Fund and The Hanover American Value Fund, each
a series of The Hanover Investment Funds,
Inc., for the fiscal year ended November 30,
1995 are incorporated by reference into Part B
as part of the 1995 Annual Reports to
Shareholders for such funds as filed with the
Securities and Exchange Commission by The
Hanover Investment Funds, Inc. on Form N-30D
on February 5, 1996, accession number
0000950123-96-000348, which are incorporated
into Part B by reference. Financial Statements
and the Reports thereon for the Vista European
Fund, Vista Japan Fund and Vista Southeast
Asian Fund for the period ended April 30, 1996
are incorporated by reference into Part B as
part of the April 30, 1996 Semi-Annual Report
to Shareholders for such funds as filed with
the Securities and Exchange Commission by
Mutual Fund Group on Form N-30D on June 25,
1996, accession number 0000950123-96-003251,
which is incorporated into Part B by
reference.

In Part C: None.

(b) Exhibits:

Exhibit
Number
- -------
1(a) Declaration of Trust, as amended. (1)
1(b) Certificate of Amendment to Declaration of Trust dated December 14,
1995.(12)
1(c) Certificate of Amendment to Declaration of Trust dated October 19,
1995.(12)
1(d) Certificate of Amendment to Declaration of Trust dated July 25,
1993.(12)
2 By-laws, as amended. (1)
3 None.
4 Specimen share certificate. (1)
5(a) Investment Advisory Agreements and Sub-Advisory Agreements(6)
5(b) Form of Investment Advisory Agreement for Vista Small Cap Equity
Fund. (9)
5(c) Administration Agreement.(6)
5(d) Form of Interim Investment Advisory Agreement.(12)
5(e) Form of Proposed Investment Advisory Agreement.(12)
5(f) Form of Proposed Sub-Advisory Agreement between The Chase Manhattan
Bank and Chase Asset Management, Inc.(12)
5(g) Form of Administration Agreement.(12)
5(h) Form of Proposed Investment Subadvisory Agreement between The Chase
Manhattan Bank and [Chase Asset Management, Inc./Van Deventer &
Hoch(12)].
6(a) Distribution and Sub-Administration Agreement.(6)
6(b) Distribution and Sub-Administration Agreement dated August 21,
1995.(12)
7(a) Retirement Plan for Eligible Trustees.(12)
7(b) Deferred Compensation Plan for Eligible Trustees.(12)
8(a) Custodian Agreement. (1)
8(b) Sub-Custodian Agreement. (1)
9(a) Transfer Agency Agreement. (1)
9(b) Administrative Services Plan. (1)
9(c) Shareholder Servicing Agreement of Vista Mutual Funds. (1)
9(d) Form of Shareholder Servicing Agreement of Vista Premier Funds.(1)
9(e) Form of Shareholder Servicing Agreement. (12)

C-1

<PAGE>

9(f) Agreement and Plan of Reorganization and Liquidation.(12)
10 Opinion re: Legality of Securities being Registered.(1)
11 Consent of Price Waterhouse LLP.(13)

12 None.
13 Not Applicable

14 None.
15(a) Rule 12b-1 Distribution Plan of Vista Mutual Funds including
Selected Dealer Agreement and Shareholder Service Agreement. (1)
15(b) Rule 12b-1 Distribution Plan of Vista Premier Funds including
Selected Dealer Agreement and Shareholder Service Agreement. (1)
15(c) Rule 12b-1 Distribution Plan for each of Vista Bond Fund, Vista
Short-Term Bond Fund, Vista Equity Fund and Vista U.S. Government
Money Market Fund including Selected Dealer Agreement and
Shareholder Service Agreement.(3)
15(d) Form of Rule 12b-1 Distribution Plan for Class B shares of the Vista
Prime Money Market Fund.(8)
15(e) Form of Rule 12b-1 Distribution Plan for Vista Asian Oceanic Shares
Fund, Vista Japan Pacific Shares Fund, Vista U.S. Government
Securities Fund and Vista European Shares Fund.(8)
15(f) Form of Rule 12b-1 Distribution Plan for Vista Small Cap Equity
Fund.(9)
15(g) Proposed Rule 12b-1 Distribution Plan - Class A Shares - Vista
American Value Fund (including forms of Selected Dealer Agreement
and Shareholder Servicing Agreement).(12)
15(h) Rule 12b-1 Distribution Plan - Class B Shares (including forms of
Selected Dealer Agreement and Shareholder Servicing Agreement).(12)
16 Schedule for Computation for Each Performance Quotation.(11)
17 Financial Data Schedule.(13)
18 Form of Rule 18f-3 Multi-Class Plan.(12)

- --------------------
(1) Filed as an exhibit to Amendment No. 6 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) as filed with the
Securities and Exchange Commission on March 23, 1990.
(2) Filed as an exhibit to Amendment No. 11 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) as filed with the
Securities and Exchange Commission on June 8, 1992 to register shares of
the Vista Balanced Fund and IEEE Spectrum Fund series of the Trust.
(3) Filed as an exhibit to Amendment No. 15 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) as filed with the
Securities and Exchange Commission on October 30, 1992.
(4) Filed as an exhibit to Amendment No. 16 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on December 28, 1992.
(5) Filed as an exhibit to Amendment No. 19 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on June 30, 1993.
(6) Filed as an exhibit to Amendment No. 23 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on December 30, 1993.
(7) Filed as an exhibit to Amendment No. 24 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on February 10, 1994.
(8) Filed as an Exhibit to Amendment No. 26 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on June 30, 1994.
(9) Filed as an Exhibit to Amendment No. 27 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on October 3, 1994.
(10) Filed as an Exhibit to Amendment No. 30 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on July 19, 1995.
(11) Filed as an Exhibit to Amendment No. 31 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on November 13, 1995.
(12) Filed as an Exhibit to Amendment No. 32 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on December 28, 1995.
(13) Filed as an exhibit to Amendment No. 37 to the Registration Statement on
Form N-1A of the Registrant (File No. 33-14196) on August 7, 1996.

ITEM 25. Persons Controlled by or Under Common
Control with Registrant

Not applicable

C-2

<PAGE>

ITEM 26. Number of Holders of Securities

Number of Record Holders
Title of Series as of August 31, 1996
- --------------- -----------------------------
A B Institutional
Shares Shares Shares
------ ------ ------
VISTA(SM) U.S. Treasury Income Fund 2,482 766 n/a
VISTA(SM) U.S. Government Securities Fund 62 n/a 98
VISTA(SM) Balanced Fund 1,935 735 n/a
VISTA(SM) Short-Term Bond Fund 74 n/a 71
VISTA(SM) Bond Fund 26 23 77
VISTA(SM) Large Cap Equity Fund 211 13 214
VISTA(SM) American Value Fund 190 n/a n/a
VISTA(SM) Equity Income Fund 757 32 n/a
VISTA(SM) Small Cap Equity Fund 7,583 5,818 none
VISTA(SM) Growth and Income Fund 74,383 23,421 9
VISTA(SM) Capital Growth Fund 37,082 23,579 10
VISTA(SM) International Equity Fund 2,500 1,174 n/a
VISTA(SM) Global Fixed Income Fund 120 47 n/a
VISTA(SM) Southeast Asian Fund 372 174 n/a
VISTA(SM) European Fund 74 24 n/a
VISTA(SM) Japan Fund 106 31 n/a
VISTA(SM) Select Growth and Income Fund n/a n/a none

ITEM 27. Indemnification

Reference is hereby made to Article V of the Registrant's Declaration
of Trust.

The Trustees and officers of the Registrant and the personnel of the
Registrant's investment adviser, administrator and distributor are insured under
an errors and omissions liability insurance policy. The Registrant and its
officers are also insured under the fidelity bond required by Rule 17g-1 under
the Investment Company Act of 1940.

Under the terms of the Registrant's Declaration of Trust, the
Registrant may indemnify any person who was or is a Trustee, officer or employee
of the Registrant to the maximum extent permitted by law; provided, however,
that any such indemnification (unless ordered by a court) shall be made by the
Registrant only as authorized in the specific case upon a determination that
indemnification of such persons is proper in the circumstances. Such
determination shall be made (i) by the Trustees, by a majority vote of a quorum
which consists of Trustees who are neither in Section 2(a)(19) of the Investment
Company Act of 1940, nor parties to the proceeding, or (ii) if the required
quorum is not obtainable or, if a quorum of such Trustees so directs, by
independent legal counsel in a written opinion. No indemnification will be
provided by the Registrant to any Trustee or officer of the Registrant for any
liability to the Registrant or shareholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of duty.

Insofar as the conditional advancing of indemnification monies for
actions based upon the Investment Company Act of 1940 may be concerned, such
payments will be made only on the following conditions: (i) the advances must be
limited to amounts used, or to be used, for the preparation or presentation of a
defense to the action, including costs connected with the preparation of a
settlement; (ii) advances may be made only upon receipt of a written promise by,
or on behalf of, the recipient to repay that amount of the advance which exceeds
that amount to which it is ultimately determined that he is entitled to receive
from the Registrant by reason of indemnification; and (iii) (a) such promise
must be secured by a surety bond, other suitable

C-3

<PAGE>

insurance or an equivalent form of security which assures that any repayments
may be obtained by the Registrant without delay or litigation, which bond,
insurance or other form of security must be provided by the recipient of the
advance, or (b) a majority of a quorum of the Registrant's disinterested,
non-party Trustees, or an independent legal counsel in a written opinion, shall
determine, based upon a review of readily available facts, that the recipient of
the advance ultimately will be found entitled to indemnification.

Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to trustees, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of it counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

ITEM 28(a). Business and Other Connections of Investment Adviser

The Chase Manhattan Bank (the "Adviser") is a commercial bank
providing a wide range of banking and investment services.

To the knowledge of the Registrant, none of the Directors or
executive officers of the Adviser, except those described below, are or have
been, at any time during the past two years, engaged in any other business,
profession, vocation or employment of a substantial nature, except that certain
Directors and executive officers of the Adviser also hold or have held various
positions with bank and non-bank affiliates of the Adviser, including its
parent, The Chase Manhattan Corporation. Each Director listed below is also a
Director of The Chase Manhattan Corporation.

<TABLE>
<CAPTION>
Principal Occupation or Other
Position with Employment of a Substantial
Name the Adviser Nature During Past Two Years
- ---- ------------- -----------------------------
<S> <C> <C>

Thomas G. Labreque President and Chief Operating Officer Chairman, Chief Executive Officer
and Director and a Director of The Chase
Manhattan Corporation and a
Director of AMAX, Inc.

M. Anthony Burns Director Chairman of the Board, President
and Chief Executive Officer of
Ryder System, Inc.

</TABLE>

C-4

<PAGE>

H. Laurance Fuller Director Chairman, President, Chief
Executive Officer and Director of
Amoco Corporation and Director of
Abbott Laboratories

Paul W. MacAvoy Director Dean of Yale School of
Organization and Management

David T. McLaughlin Director President and Chief Executive
Officer of The Aspen Institute,
Chairman of Standard Fuse
Corporation and a Director of each
of ARCO Chemical Company and
Westinghouse Electric Corporation

Edmund T. Pratt, Jr. Director Chairman Emeritus, formerly
Chairman and Chief Executive
Officer, of Pfizer Inc. and a
Director of each of Pfizer, Inc.,
Celgene Corp., General Motors
Corporation and International Paper
Company

Henry B. Schacht Director Chairman and Chief Executive
Officer of Cummins Engine
Company, Inc. and a Director of
each of American Telephone and
Telegraph Company and CBS Inc.

Donald H. Trautlein Director Retired Chairman and
Chief Executive Officer
of Bethlehem Steel
Corporation

</TABLE>

C-5

<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
James L. Ferguson Director Retired Chairman and Chief
Executive Officer of General Foods
Corporation

William H. Gray III Director President and Chief Executive
Officer of the United Negro College
Fund, Inc.

David T. Kearns Director Retired Chairman and Chief
Executive Officer of the Xerox
Corporation

Delano E. Lewis Director President and Chief Executive
Officer of National Public Radio

John H. McArthur Director Dean of the Harvard Graduate
School of Business Administration

Frank A. Bennack, Jr. Director President and Chief Executive Officer
The Hearst Corporation

Michael C. Bergerac Director Chairman of the Board and
Chief Executive Officer Bergerac & Co., Inc.

Susan V. Berresford Director President, The Ford Foundation

Randolph W. Bromery Director President, Springfield College; President,
Geoscience Engineering Corporation

Charles W. Duncan, Jr. Director Private Investor

Melvin R. Goodes Director Chairman of the Board and Chief Executive
Officer, The Warner-Lambert Company

George V. Grune Director Retired Chairman and Chief Executive
Officer, The Reader's Digest Association,
Inc.; Chairman, The DeWitt Wallace-
Reader's Digest Fund; The Lila-Wallace
Reader's Digest Fund

William B. Harrison, Jr. Vice Chairman of the Board

Harold S. Hook Director Chairman and Chief Executive Officer,
General Corporation

Helen L. Kaplan Director Of Counsel, Skadden, Arps, Slate, Meagher
& Flom

E. Michael Kruse Vice Chairman of the Board

J. Bruce Llewellyn Director Chairman of the Board, The Philadelphia
Coca-Cola Bottling Company, The Coca-
Cola Bottling Company of Wilmington,
Inc., Queen City Broadcasting, Inc.

John P. Mascotte Director Chairman, The Missouri Corporation of
Johnson & Higgins

John F. McGillicuddy Director Retired Chairman of the Board and
Chief Executive Officer

Edward D. Miller Senior Vice Chairman
of the Board

Walter V. Shipley Chairman of the Board and
Chief Executive Officer

Andrew C. Sigler Director Chairman of the Board and Chief
Executive Officer, Champion International
Corporation

Michael I. Sovern Director President, Emeritus and Chancellor Kent,
Professor of Law, Columbia University

John R. Stafford Director Chairman, President and Chief Executive
Officer, American Home Products
Corporation

W. Bruce Thomas Director Private Investor

Marina v. N. Whitman Director Professor of Business Administration and
Public Policy, University of Michigan

Richard D. Wood Director Retired Chairman of the Board, Eli Lilly
and Company
</TABLE>

<PAGE>

Item 28(b)

Chase Asset Management ("CAM") is an Investment Advisor providing investment
services to institutional clients.

To the knowledge of the Registrant, none of the Directors or executive
officers of the CAM, except those described below, are or have been, at any time
during the past two years, engaged in any other business, profession, vocation
or employment of a substantial nature, except that certain Directors and
executive officers of the CAM also hold or have held various positions with bank
and non-bank affiliates of the Advisor, including its parent, The Chase
Manhattan Corporation.

Principal Occupation or Other
Position with Employment of a Substantial
Name the Sub-Advisor Nature During Past Two Years
- ---- --------------- ----------------------------

James Zeigon Chairman and Director Director of Chase
Asset Management
(London) Limited

Steven Prostano Executive Vice President Chief Operating Officer
and Chief Operating Officer and Director of Chase
Asset Management
(London) Limited

Mark Richardson President and Chief Chief Investment Officer
Investment Officer and Director of Chase
Asset Management
(London) Limited

Item 28(c)

Chase Asset Management (London) Limited ("CAM London") is an Investment
Advisor providing investment services to institutional clients.

To the knowledge of the Registrant, none of the Directors or executive
officers of CAM London, except those described below, are or have been, at any
time during the past two years, engaged in any other business, profession,
vocation or employment of a substantial nature, except that certain Directors
and executive officers of CAM London also hold or have held various positions
with bank and non-bank affiliates of the Advisor, including its parent, The
Chase Manhattan Corporation.

Principal Occupation or Other
Position with Employment of a Substantial
Name the Sub-Advisor Nature During Past Two Years
- ---- --------------- ----------------------------

Michael Browne Director Fund Manager, The Chase Manhattan
Bank, N.A.; Fund Manager, BZW
Investment Management

David Gordon Ross Director Head of Global Fixed Income
Management, Chase Asset
Management, Inc.; Vice President,
The Chase Manhattan Bank, N.A.

Brian Harte Director Investment Manager, The Chase
Manhattan Bank, N.A.

Cornelia L. Kiley Director

James Zeigon Director Chairman and Director of Chase
Asset Management, Inc.

Mark Richardson Chief Investment Director, President and Chief
Officer and Director Operating Officer of Chase Asset
Management, Inc.

Steve Prostano Chief Operating Director, Executive Vice President
Officer and and Chief Operating Officer of Chase
Director Asset Management, Inc.

<PAGE>

ITEM 29. Principal Underwriters

(a) Vista Fund Distributors, Inc., a wholly-owned subsidiary of
The BISYS Group, Inc. is the underwriter for Mutual Fund Group, Mutual Fund
Trust and Mutual Fund Select Trust.

(b) The following are the Directors and officers of Vista Fund
Distributors, Inc. The principal business address of each of these persons, is
listed below.

<TABLE>
<CAPTION>
Position and Offices Position and Offices
Name and Address with Distributor with the Registrant
- ---------------- -------------------- --------------------
<S> <C> <C>

Lynn J. Mangum Chairman None
150 Clove Street
Little Falls, NJ 07424

Robert J. McMullan Director and Exec. Vice President None
150 Clove Street
Little Falls, NJ 07424

Lee W. Schultheis President None
101 Park Avenue, 16th Floor
New York, NY 10178

George O. Martinez Senior Vice President None
3435 Stelzer Road
Columbus, OH 43219

Irimga McKay Vice President None
1230 Columbia Street
5th Floor, Suite 500
San Diego, CA 92101

Michael Burns Vice President/Compliance None
3435 Stelzer Road
Columbus, OH 43219

William Blundin Vice President None
125 West 55th Avenue
11th Floor
New York, NY 10019

Dennis Sheehan Vice President None
150 Clove Street
Little Falls, NJ 07424

Annamaria Porcaro Assistant Secretary None
150 Clove Street
Little Falls, NJ 97424

Robert Tuch Assistant Secretary None
3435 Stelzer Road
Columbus, OH 43219

Stephen Mintos Executive Vice President/COO None
3435 Stelzer Road
Columbus, OH 43219

Dale Smith Vice President/CFO None
3435 Stelzer Road
Columbus, OH 43219

William J. Tomko Vice President None
3435 Stelzer Road
Columbus, OH 43219
</TABLE>

C-6

<PAGE>
ITEM 30. Location of Accounts and Records

The accounts and records of the Registrant are located, in whole or in
part, at the office of the Registrant and the following locations:

Name Address
---- -------
Vista Fund Distributors, Inc. 101 Park Avenue,
New York, NY 10178

DST Systems, Inc. 210 W. 10th Street,
Kansas City, MO 64105

The Chase Manhattan Bank 270 Park Avenue,
New York, NY 10017

Chase Asset Mangement, Inc. 1211 Avenue of the
Americas,
New York, NY 10036

Chase Asset Management, Ltd. (London) Colvile House
32 Curzon Street
London, England W1Y8AL

The Chase Manhattan Bank One Chase Square,
Rochester, NY 14363

ITEM 31. Management Services

Not applicable

ITEM 32. Undertakings

(1) Registrant undertakes that its trustees shall promptly
call a meeting of shareholders of the Trust for the purpose of voting upon the
question of removal of any such trustee or trustees when requested in writing so
to do by the record holders of not less than 10 per centum of the outstanding
shares of the Trust. In addition, the Registrant shall, in certain
circumstances, give such shareholders assistance in communicating with other
shareholders of a fund as required by Section 16(c) of the Investment Company
Act of 1940.

(2) The Registrant, on behalf of the Funds, undertakes,
provided the information required by Item 5A is contained in the latest annual
report to shareholders, to furnish to each person to whom a prospectus has been
delivered, upon their request and without charge, a copy of the Registrant's
latest annual report to shareholders.

(3) Registrant undertakes to file a post-effective amendment,
using reasonably current financial statements which need not be certified,
within four to six months from the date of commencement of investment operations
for Vista Select Growth and Income Fund.

C-7

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Post-Effective
Amendment to its Registration Statement on Form N-1A to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of New York and the
State of New York on the 15th day of October, 1996.

MUTUAL FUND GROUP

By /s/ H. Richard Vartabedian
--------------------------
H. Richard Vartabedian
President

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment to the Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.

/s/ Fergus Reid, III Chairman and Trustee October 15, 1996
_______________________________
Fergus Reid, III

/s/ William J. Armstrong Trustee October 15, 1996
_______________________________
William J. Armstrong

/s/ John R.H. Blum Trustee October 15, 1996
_______________________________
John R.H. Blum

/s/ Joseph J. Harkins Trustee October 15, 1996
_______________________________
Joseph J. Harkins

/s/ Richard E. Ten Haken Trustee October 15, 1996
_______________________________
Richard E. Ten Haken

/s/ Stuart W. Cragin, Jr. Trustee October 15, 1996
_______________________________
Stuart W. Cragin, Jr.

/s/ Irv Thode Trustee October 15, 1996
_______________________________
Irv Thode

/s/ H. Richard Vartabedian President October 15, 1996
_______________________________ and Trustee
H. Richard Vartabedian

/s/ W. Perry Neff
_______________________________ Trustee October 15, 1996
W. Perry Neff

/s/ Roland R. Eppley, Jr.
_______________________________ Trustee October 15, 1996
Roland R. Eppley, Jr.

/s/ W.D. MacCallan
_______________________________ Trustee October 15, 1996
W.D. MacCallan

C-8

<PAGE>

/s/ Martin R. Dean Treasurer and October 15, 1996
_______________________________ Principal Financial
Martin R. Dean Officer

<PAGE>

SIGNATURES

Growth and Income Portfolio has duly caused this Post-Effective Amendment to the
Registration Statement on Form N-1A of Mutual Fund Group to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York
and the State of New York on the 15th day of October, 1996.

GROWTH AND INCOME PORTFOLIO

By /s/ H. Richard Vartabedian
____________________________
H. Richard Vartabedian
Chairman and President

This Amendment to the Registration Statement on Form N-1A of Mutual Fund Group
has been signed below by the following persons in the capacities and on the
dates indicated.

/s/ H. Richard Vartabedian
_______________________________ Chairman, President October 15, 1996
H. Richard Vartabedian and Trustee

*
_______________________________ Trustee October 15, 1996
William J. Armstrong

*
_______________________________ Trustee October 15, 1996
John R.H. Blum

*
_______________________________ Trustee October 15, 1996
Joseph J. Harkins

*
_______________________________ Trustee October 15, 1996
Richard E. Ten Haken

*
_______________________________ Trustee October 15, 1996
Stuart W. Cragin, Jr.

*
_______________________________ Trustee October 15, 1996
Irving L. Thode

*
_______________________________ Trustee October 15, 1996
Fergus Reid, III

*
_______________________________ Trustee October 15, 1996
W. Perry Neff

*
_______________________________ Trustee October 15, 1996
Roland R. Eppley, Jr.

*
_______________________________ Trustee October 15, 1996
W.D. MacCallan

/s/ H. Richard Vartabedian
_______________________________ Attorney October 15, 1996
H. Richard Vartabedian in Fact