American Skandia Trust
Supplement dated February 2, 1999 to the Prospectus dated December 31, 1998
AST American Century Strategic Balanced Portfolio
Effective March 1, 1999, a quantitative, computer-aided process will be
implemented for the selection of securities for the equity portion of the AST
American Century Strategic Balanced Portfolio (the "Portfolio"). These changes
will occur in connection with the change in the portfolio managers for the
equity portion of the Portfolio to those persons listed in the section of the
December 31, 1998 prospectus entitled "Management of the Trust - Sub-advisors -
American Century Investment Management, Inc." (on page 117).
Accordingly, the section of the prospectus entitled "Investment
Objectives and Policies -- AST American Century Strategic Balanced Portfolio --
Investment Policies -- Equity Investments" (on pages 68-69) is deleted and
replaced with the following:
Equity Investments. With the equity portion of the Portfolio, the
Sub-advisor utilizes quantitative management techniques in a two-step
process that draws heavily on computer technology. In the first step,
the Sub-advisor ranks stocks, primarily the 1,500 largest publicly
traded U.S. companies as measured by market capitalization. These
rankings are determined by using a computer model that combines
measures of a stock's value and measures of its growth potential. To
measure value, the Sub-advisor uses ratios of stock price to book value
and stock price to cash flow, among others. To measure growth, the
manager uses, among others, the rate of growth in a company's earnings
and changes in its earnings estimates.
In the second step, the Sub-advisor uses a technique called portfolio
optimization. In portfolio optimization, the Sub-advisor uses a
computer to build a portfolio of stocks from the ranking described
earlier that it thinks will provide the best balance between risk and
expected return. The goal is to create an equity portfolio that
provides better returns than the S&P 500 Index without taking on
significant additional risk.
