G T INVESTMENT FUNDS INC
497, 1996-01-10
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<PAGE>
                             GT GLOBAL THEME FUNDS
                          PROSPECTUS -- MARCH 1, 1995
                           AS REVISED JANUARY 5, 1996
- --------------------------------------------------------------------------------

GT GLOBAL FINANCIAL SERVICES FUND ("Financial Services Fund") seeks long-term
capital growth by investing all of its investable assets in the Global Financial
Services Portfolio ("Financial Services Portfolio"), that, in turn, invests
primarily in securities of companies throughout the world that operate within
the financial services industry.
GT GLOBAL INFRASTRUCTURE FUND ("Infrastructure Fund") seeks long-term capital
growth by investing all of its investable assets in the Global Infrastructure
Portfolio ("Infrastructure Portfolio"), that, in turn, invests primarily in
securities of companies throughout the world that design, develop or provide
products and services significant to a country's infrastructure.
GT GLOBAL NATURAL RESOURCES FUND ("Natural Resources Fund") seeks long-term
capital growth by investing all of its investable assets in the Global Natural
Resources Portfolio ("Natural Resources Portfolio"), that, in turn, invests
primarily in securities of companies throughout the world that own, explore, or
develop natural resources and other basic commodities, or supply goods and
services to such companies.

GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND ("Consumer Products and Services
Fund") seeks long-term capital growth by investing all of its investable assets
in the Global Consumer Products and Services Portfolio ("Consumer Products and
Services Portfolio"), that, in turn, invests primarily in securities of
companies throughout the world that manufacture, market, retail, or distribute
consumer products and services.

GT GLOBAL HEALTH CARE FUND ("Health Care Fund") seeks long-term capital
appreciation by investing in securities of health care companies throughout the
world.

GT GLOBAL TELECOMMUNICATIONS FUND ("Telecommunications Fund") seeks long-term
growth of capital by investing primarily in securities of companies throughout
the world engaged in development, manufacture or sale of telecommunication
services or equipment.

Collectively, the above Funds are known as the GT Global Theme Funds.

There can be no assurance that any GT Global Theme Fund or any Portfolio will
achieve its investment objective.

FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR GUARANTEED BY,
ANY BANK, NOR ARE THEY FEDERALLY INSURED OR OTHERWISE PROTECTED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.

The Financial Services Fund, Infrastructure Fund, Natural Resources Fund,
Telecommunications Fund and Consumer Products and Services Fund are mutual funds
each organized as a diversified series, and the Health Care Fund as a
non-diversified series, of G.T. Investment Funds, Inc. ("Company"). THE
FINANCIAL SERVICES FUND, INFRASTRUCTURE FUND, NATURAL RESOURCES FUND AND
CONSUMER PRODUCTS AND SERVICES FUND, UNLIKE MANY OTHER INVESTMENT COMPANIES
WHICH DIRECTLY ACQUIRE AND MANAGE THEIR OWN PORTFOLIOS OF SECURITIES, EACH SEEKS
ITS INVESTMENT OBJECTIVE BY INVESTING ALL OF ITS INVESTABLE ASSETS IN ITS
CORRESPONDING PORTFOLIO, AS DESCRIBED ABOVE. The Financial Services Portfolio,
Infrastructure Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio ("Portfolios") and the Health Care Fund and
Telecommunications Fund are open-end management investment companies each
managed by LGT Asset Management, Inc. ("LGT Asset Management"). LGT Asset
Management, formerly G.T. Capital Management, Inc., and its worldwide
affiliates, are part of Liechtenstein Global Trust, formerly BIL GT Group
Limited, a provider of global asset management and private banking products and
services to individual and institutional investors. On January 1, 1996, G.T.
Capital Management, Inc. was renamed LGT Asset Management, and BIL GT Group
Limited was renamed Liechtenstein Global Trust.
Each of the Portfolios' investment objective is identical to that of its
corresponding Fund. This structure is different from that of many other
investment companies which directly acquire and manage their own portfolios.
Accordingly, investors should carefully consider this investment approach. For
additional information, see "Investment Objective and Policies" and
"Management."
LGT Asset Management attempts to identify countries where economic, political
and regulatory factors are likely to produce above-average growth rates, and to
further identify companies within the industries in which each of the GT Global
Theme Funds invests that are best positioned to benefit from these factors.
PROSPECTIVE WISCONSIN INVESTORS SHOULD NOTE THAT THE INFRASTRUCTURE FUND,
NATURAL RESOURCES FUND AND CONSUMER PRODUCTS AND SERVICES FUND MAY EACH INVEST
UP TO 10% OF ITS TOTAL ASSETS IN RESTRICTED SECURITIES. THIS INVESTMENT ACTIVITY
MAY BE CONSIDERED SPECULATIVE.

This Prospectus sets forth concisely information that an investor should know
before investing and should be read carefully and retained for future reference.
A Statement of Additional Information, dated March 1, 1995, as revised January
5, 1996, has been filed with the Securities and Exchange Commission ("SEC") and,
as amended or supplemented from time to time, is incorporated herein by
reference. The Statement of Additional Information is available without charge
by writing to the Funds at 50 California Street, 27th Floor, San Francisco,
California 94111, or calling (800) 824-1580.

An investment in the GT Global Theme Funds offers the following advantages:
/ / Professional Management by a Leading Manager with Offices in the World's
    Major Markets
/ / Low $500 Minimum Investment
/ / Alternative Purchase Plan
/ / Automatic Dividend and Other Distribution Reinvestment at No Additional
    Sales Charge
/ / Exchange Privileges with the Corresponding Classes of the other GT Global
    Mutual Funds
/ / Reduced Sales Charge Plans
/ / Dollar Cost Averaging Program
/ / Automatic Investment Plan
/ / Systematic Withdrawal Plan

FOR FURTHER INFORMATION, CONTACT (800) 824-1580 OR YOUR STOCKBROKER.

[LOGO]

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

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  ON THE  ACCURACY OR  ADEQUACY OF  THIS  PROSPECTUS.
             ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                               Prospectus Page 1
<PAGE>
                             GT GLOBAL THEME FUNDS

                               TABLE OF CONTENTS
- ------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                              Page
                                                                                            ---------
<S>                                                                                         <C>
Prospectus Summary........................................................................          3
Financial Highlights......................................................................         12
Alternative Purchase Plan.................................................................         15
Investment Objective and Policies.........................................................         16
Risk Factors..............................................................................         25
How to Invest.............................................................................         34
How to Make Exchanges.....................................................................         40
How to Redeem Shares......................................................................         41
Shareholder Account Manual................................................................         43
Calculation of Net Asset Value............................................................         44
Dividends, Other Distributions and Federal Income Taxation................................         44
Management................................................................................         46
Other Information.........................................................................         53
</TABLE>

                               Prospectus Page 2
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
- ------------------------------------------------------------
The following summary is qualified in its entirety by the more detailed
information appearing in the body of this Prospectus. Cross-references in this
summary are to headings in the body of the Prospectus.

<TABLE>
<S>                            <C>                               <C>
Investment Objective:          The   Financial  Services   Fund,  Infrastructure   Fund,  Natural
                               Resources Fund and Consumer Products and Services Fund each  seeks
                               long-term  capital growth.  The Health  Care Fund  seeks long-term
                               capital appreciation. The Telecommunications Fund seeks  long-term
                               growth of capital

Principal Investments:         Financial  Services Fund invests  all of its  investable assets in
                               the Financial Services Portfolio, that, in turn, invests primarily
                               in the securities of companies  throughout the world that  operate
                               in the financial services industry

                               Infrastructure  Fund invests all  of its investable  assets in the
                               Infrastructure Portfolio, that, in turn, invests primarily in  the
                               securities  of companies throughout the world that design, develop
                               or provide  products  and  services  significant  to  a  country's
                               infrastructure

                               Natural Resources Fund invests all of its investable assets in the
                               Natural  Resources Portfolio, that, in  turn, invests primarily in
                               the securities of companies throughout the world that own, explore
                               or develop  natural  resources  and other  basic  commodities,  or
                               supply goods and services to such companies

                               Consumer  Products and Services Fund invests all of its investable
                               assets in the Consumer Products  and Services Portfolio, that,  in
                               turn,  invests primarily in the securities of companies throughout
                               the world that manufacture, market, retail or distribute  consumer
                               products and services

                               Health  Care Fund invests principally  in the securities of health
                               care companies throughout the world

                               Telecommunications Fund invests principally  in the securities  of
                               companies   throughout  the  world  engaged  in  the  development,
                               manufacture or sale of telecommunications services or equipment

Investment Manager:            LGT Asset  Management is  part of  Liechtenstein Global  Trust,  a
                               provider  of global asset management  and private banking products
                               and services to individual  and institutional investors  entrusted
                               with approximately $45 billion in total assets

Alternative Purchase Plan:     Investors  may select Class  A or Class B  shares, each subject to
                               different expenses and a different sales charge structure

  Class A Shares:              Offered at  net  asset  value plus  any  applicable  sales  charge
                               (maximum is 4.75% of public offering price) and subject to service
                               and distribution fees at the annualized rate of up to 0.50% of the
                               average daily net assets of each Fund's Class A shares

  Class B Shares:              Offered  at net asset  value (a maximum  contingent deferred sales
                               charge of 5% of the lesser of  the shares' net asset value or  the
                               original  purchase price  is imposed  on certain  redemptions made
                               within six years of date of  purchase) and subject to service  and
                               distribution  fees at  the annualized rate  of up to  1.00% of the
                               average daily net assets of each Fund's Class B shares
</TABLE>

                               Prospectus Page 3
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<S>                            <C>                               <C>
Shares Available Through:      Most brokerage firms  nationwide, or directly  through the  Funds'
                               distributor

Exchange Privileges:           Shares  of a  class of  a Fund  may be  exchanged without  a sales
                               charge for shares of  the corresponding class  of other GT  Global
                               Mutual  Funds, which are  open-end management investment companies
                               advised and/or administered by LGT Asset Management and registered
                               with the Securities and Exchange Commission

Dividends and Other
  Distributions:               Dividends paid annually from  available net investment income  and
                               realized  net short-term  capital gains;  other distributions paid
                               annually from realized net capital gain and net gains from foreign
                               currency transactions, if any

Reinvestment:                  Distributions may be  reinvested automatically in  Fund shares  of
                               the  distributing class or in shares of the corresponding class of
                               other GT Global Mutual Funds without a sales charge

First Purchase:                $500 minimum ($100 for individual retirement accounts ("IRAs") and
                               reduced amounts for certain other retirement plans)

Subsequent Purchases:          $100  minimum  (reduced  amounts   for  IRAs  and  certain   other
                               retirement plans)

Net Asset Values:              Class A and B shares of Health Care Fund, Telecommunications Fund,
                               Infrastructure  Fund and Natural Resources  Fund are quoted daily,
                               and Financial  Services Fund  and Consumer  Products and  Services
                               Fund  are expected to be quoted daily, in the financial section of
                               most newspapers

Other Features:

  Class A Shares               Letter of Intent                  Dollar Cost Averaging Program
                               Quantity Discounts                Automatic Investment Plan
                               Right of Accumulation             Systematic Withdrawal Plan
                               Reinstatement Privilege

  Class B Shares               Reinstatement Privilege           Automatic Investment Plan
                               Systematic Withdrawal Plan        Dollar Cost Averaging Program
</TABLE>

                               Prospectus Page 4
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------

THE GT GLOBAL THEME FUNDS. The Financial Services Fund, Infrastructure Fund,
Natural Resources Fund and Consumer Products and Services Fund each seeks
long-term capital growth, the Telecommunications Fund seeks long-term growth of
capital and the Health Care Fund seeks long-term capital appreciation. Each Fund
is hereinafter referred to individually as a "Fund" and collectively as "Funds."

In seeking this objective, each of the Financial Services Fund, Infrastructure
Fund, Natural Resources Fund and Consumer Products and Services Fund invests all
of its investable assets in the Financial Services Portfolio, Infrastructure
Portfolio, Natural Resources Portfolio and Consumer Products and Services
Portfolio, respectively, that, in turn, invests in securities in accordance with
an investment objective and policies identical to those of its corresponding
Fund. The Health Care Fund and Telecommunications Fund each seeks its investment
objective by investing primarily in securities of health care and
telecommunications companies, respectively, throughout the world. The Financial
Services Portfolio, Infrastructure Portfolio, Natural Resources Portfolio,
Consumer Products and Services Portfolio, Health Care Fund and
Telecommunications Fund are hereinafter referred to individually as a "Theme
Portfolio," or collectively, "Theme Portfolios." Each of the Theme Portfolios
concentrates in the industry corresponding to that Theme Portfolio's name, and
invests in companies engaged in activities related to its investment theme.

The Financial Services Fund, Infrastructure Fund, Natural Resources Fund,
Consumer Products and Services Fund and Telecommunications Fund are mutual funds
organized as diversified series, and the Health Care Fund as a non-diversified
series, of G.T. Investment Funds, Inc. (the "Company"). Shares of each Fund's
common stock are available through broker/dealers who have entered into
agreements to sell shares with the Funds' distributor, GT Global, Inc. ("GT
Global"). Shares also may be acquired directly through the Funds' distributor or
through exchanges of shares of the other GT Global Mutual Funds. See "How to
Invest" and "Shareholder Account Manual." Shares may be redeemed either through
broker/dealers or the Funds' Transfer Agent, GT Global Investor Services, Inc.
("Transfer Agent"). See "How to Redeem Shares" and "Shareholder Account Manual."

INVESTMENT MANAGER AND ADMINISTRATOR. LGT Asset Management, Inc. ("LGT Asset
Management") is the investment manager and administrator for the Portfolios, the
Health Care Fund and Telecommunications Fund, and is the administrator for the
Financial Services Fund, Infrastructure Fund, Natural Resources Fund and
Consumer Products and Services Fund. LGT Asset Management provides investment
management and/or administration services to all of the GT Global Mutual Funds,
as well as other institutional, corporate and individual clients. LGT Asset
Management and its worldwide asset management affiliates maintain fully-staffed
investment offices in San Francisco, London, Hong Kong, Tokyo, Singapore, Sydney
and Frankfurt. LGT Asset Management is part of Liechtenstein Global Trust, a
provider of global asset management and private banking products and services to
individual and institutional investors. On January 1, 1996, G.T. Capital
Management, Inc. was renamed LGT Asset Management, and BIL GT Group Limited was
renamed Liechtenstein Global Trust. As of November 30, 1995, assets entrusted to
Liechtenstein Global Trust totaled approximately $45 billion. The companies
comprising Liechtenstein Global Trust are indirect subsidiaries of the Prince of
Liechtenstein Foundation. See "Management."

INVESTMENT POLICIES. The Financial Services Fund seeks its objective by
investing all of its investable assets in the Financial Services Portfolio,
that, in turn, normally invests at least 65% of its total assets in common and
preferred stocks and warrants to acquire such securities issued by financial
services companies throughout the world. The remainder of the Financial Services
Portfolio's assets may be invested in debt securities issued by financial
services companies and/or in equity and debt securities of companies outside of
the financial services industry, which, in the opinion of LGT Asset Management,
stand to benefit from developments

                               Prospectus Page 5
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------
in the financial services industry. See "Investment Objective and Policies."

The Infrastructure Fund seeks its investment objective by investing all of its
investable assets in the Infrastructure Portfolio, that, in turn, normally
invests at least 65% of its total assets in common and preferred stocks and
warrants to acquire such securities issued by infrastructure companies
throughout the world. The remainder of the Infrastructure Portfolio's assets may
be invested in debt securities issued by infrastructure companies and/ or equity
and debt securities of companies outside of the infrastructure industries which,
in the opinion of LGT Asset Management, stand to benefit from developments in
the infrastructure industries. See "Investment Objective and Policies."

The Natural Resources Fund seeks its investment objective by investing all of
its investable assets in the Natural Resources Portfolio, that, in turn,
normally invests at least 65% of its total assets in common and preferred stock
and warrants to acquire such securities issued by companies throughout the world
which own, explore or develop natural resources and other basic commodities, or
supply goods and services to such companies. The remainder of the Portfolio's
assets may be invested in debt securities issued by such companies and/or equity
and debt securities of companies outside of the natural resource industries,
which, in the opinion of LGT Asset Management, stand to benefit from
developments in natural resource industries. See "Investment Objective and
Policies."

The Consumer Products and Services Fund seeks its investment objective by
investing all of its investable assets in the Consumer Products and Services
Portfolio, that, in turn, normally invests at least 65% of its total assets in
common and preferred stocks and warrants to acquire such securities issued by
consumer products and services companies throughout the world. The remainder of
the Consumer Products and Services Portfolio's assets may be invested in debt
securities issued by consumer products and services companies and/ or in equity
and debt securities of companies outside of the consumer products and services
industries, which, in the opinion of LGT Asset Management, stand to benefit from
developments in the consumer products and services industries. See "Investment
Objective and Policies."

The Health Care Fund normally invests at least 65% of its total assets in common
and preferred stocks and warrants to acquire such securities issued by health
care companies throughout the world which, in the opinion of LGT Asset
Management, have high potential for long-term capital growth. The remainder of
the Health Care Fund's assets may be invested in debt securities issued by
health care companies and/or equity and debt securities of companies outside of
the health care industry which, in the opinion of LGT Asset Management, stand to
benefit from developments in the health care industry. The Fund may invest up to
35% of its total assets in debt securities, including debt securities
convertible into equity, when doing so presents a favorable opportunity for
potential capital appreciation in the determination of LGT Asset Management. See
"Investment Objective and Policies."

The Telecommunications Fund normally invests at least 65% of its total assets in
common and preferred stocks and warrants to acquire such securities issued by
telecommunications companies throughout the world. The remainder of the
Telecommunications Fund's assets may be invested in debt securities issued by
telecommunications companies and/or equity and debt securities of companies
outside of the telecommunications industry which, in LGT Asset Management's
judgment, stand to benefit from developments in the telecommunications industry.
See "Investment Objective and Policies."

LGT Asset Management believes that a portfolio of the securities of companies
operating in the sectors described above located throughout the world presents
greater potential for long-term capital growth than a portfolio comprised solely
of the securities of U.S. issuers.

INVESTMENT TECHNIQUES AND RISK FACTORS. Each Theme Portfolio may engage in
certain foreign currency, options and futures transactions to attempt to hedge
against the overall level of investment and currency risk associated with its
present or planned investments.

                               Prospectus Page 6
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------

For temporary defensive purposes, each Theme Portfolio may hold U.S. or foreign
currency and/or invest any portion of its assets in debt securities or high
quality money market instruments of U.S. or foreign issuers. Each Theme
Portfolio also may hold cash and invest in high quality foreign or domestic
money market instruments pending investment of proceeds from new sales of Fund
shares, or to meet its ordinary daily cash needs. See "Investment Objective and
Policies" for a more complete discussion of the Theme Portfolios' investment
policies.

Each Theme Portfolio may borrow an amount up to 33 1/3% of its total assets in
order to meet redemption requests. This may cause greater fluctuation in the
value of a Fund's shares than would be the case if the Theme Portfolios did not
borrow, but also may enable the Theme Portfolios to retain favorable securities
positions rather than liquidating such positions to meet redemption needs. The
Theme Portfolios also are authorized to lend securities if doing so represents a
favorable investment opportunity. See "Investment Objective and Policies --
Other Policies."

The Financial Services Portfolio, Health Care Fund and Telecommunications Fund
may each invest up to 5%, and the Infrastructure Portfolio, Natural Resources
Portfolio and Consumer Products and Services Portfolio may each invest up to
20%, of its total assets in debt securities rated below investment grade, which
may include (i) corporate debt securities and (ii) debt instruments issued by
governments whose debt is unrated. Investments of this type are subject to a
greater risk of loss of principal and interest. See "Investment Objective and
Policies -- Other Policies."

There is no assurance that the Funds or the Portfolios will achieve their
investment objective. Each Fund's net asset value will fluctuate, reflecting
fluctuations in the market value of its securities holdings. The Theme
Portfolios normally invest in a substantial number of issuers, and LGT Asset
Management believes that each Theme Portfolio's policy of concentrating its
investments in its particular sector companies enables each Theme Portfolio to
take advantage of the potential for long-term growth presented by such
companies. However, this policy may cause the value of the Funds' shares to
fluctuate more than if it invested in a greater number of industries. The
companies in each such industry are subject to extensive government regulation;
this and other factors could affect the value of the Funds' shares. See "Risk
Factors."

Investments in foreign securities involve risks relating to political and
economic developments abroad and the differences between the regulations to
which U.S. and foreign issuers are subject. Individual foreign economies also
may differ favorably or unfavorably from the U.S. economy. Changes in foreign
currency exchange rates will affect the Funds' net asset value, earnings and
gains and losses realized on sales of securities. Securities of foreign
companies may be less liquid and their prices more volatile than those of
securities of comparable U.S. companies. The Theme Portfolios' participation in
the currency, options and futures markets involves certain risks and transaction
costs. See "Risk Factors."

Investors should review the investment objective and policies of the Theme
Portfolios carefully and consider their ability to assume these and other risks
involved in purchasing shares of the particular Fund.

EXPENSES. The Financial Services Fund, Infrastructure Fund, Natural Resources
Fund and Consumer Products and Services Fund each pays administration fees
directly to LGT Asset Management at an annualized rate of 0.25% of that Fund's
average daily net assets. In addition, each such Fund bears its pro rata portion
of the investment management and administration fees paid by its corresponding
Portfolio to LGT Asset Management. The Financial Services Portfolio,
Infrastructure Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio each pays such fees, based on the average daily net assets of
that Portfolio, at the annualized rate of .725% on the first $500 million, .70%
on the next $500 million, .675% on the next $500 million, and .65% on all
amounts thereafter.

The Health Care Fund and Telecommunications Fund each pays LGT Asset Management
investment management and administration fees, based on

                               Prospectus Page 7
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------
the average daily net assets of that Fund, at the annualized rate of .975% on
the first $500 million, .95% on the next $500 million, .925% on the next $500
million, and .90% on all amounts thereafter.

As each Fund's distributor, GT Global collects the sales charges imposed on
purchases of Class A shares, and reallows all or a portion of such charges to
brokers that have made such sales. In addition, GT Global collects any
contingent deferred sales charges that may be imposed on certain redemptions of
Class A shares and on redemptions of Class B shares. GT Global also pays
broker/dealers upon their sales of Class B shares; and pays broker/ dealers and
other financial institutions ongoing payments for servicing shareholder accounts
and for sales efforts.

Pursuant to a distribution plan adopted in accordance with Rule 12b-1 under the
Investment Company Act of 1940, as amended ("1940 Act"), with respect to its
Class A shares, each Fund may pay GT Global a service fee at the annualized rate
of up to 0.25% of the average daily net assets of that Fund's Class A shares as
reimbursement for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay GT Global a distribution fee at the annualized
rate of up to 0.50% of the average daily net assets of that Fund's Class A
shares, less any amounts paid by the Fund as the aforementioned service fee for
its expenditures incurred in providing services as distributor.

Pursuant to a separate distribution plan adopted in accordance with Rule 12b-1
under the 1940 Act with respect to its Class B shares, each Fund may pay GT
Global a service fee at the annualized rate of up to 0.25% of the average daily
net assets of Class B shares for its expenditures incurred in servicing and
maintaining shareholder accounts, and may pay GT Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of its Class
B shares as reimbursement for its expenditures incurred in providing services as
distributor.

Each Theme Portfolio pays all expenses not assumed by LGT Asset Management, GT
Global or other agents. LGT Asset Management and GT Global have undertaken to
limit each Theme Portfolio's expenses (exclusive of brokerage commissions,
taxes, interest and extraordinary expenses) to the annual rate of 2.40% and
2.90% of the average daily net assets of the Funds' Class A and Class B shares,
respectively. See "Management."

                               Prospectus Page 8
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------

SUMMARY OF INVESTOR COSTS. The expenses and maximum transaction costs associated
with investing in the Class A and Class B shares of the Funds and the aggregate
annual operating expenses for the Funds and the Portfolios are reflected in the
following tables*+:

<TABLE>
<CAPTION>
                                                                                                        GT GLOBAL
                                                                GT GLOBAL           GT GLOBAL           FINANCIAL
                                                               HEALTH CARE      TELECOMMUNICATIONS      SERVICES
                                                                  FUND                FUND                FUND
                                                            -----------------   -----------------   -----------------
                                                            CLASS A   CLASS B   CLASS A   CLASS B   CLASS A   CLASS B
                                                            -------   -------   -------   -------   -------   -------
SHAREHOLDER TRANSACTION COSTS:
<S>                                                         <C>       <C>       <C>       <C>       <C>       <C>
  Maximum sales charge on purchases of shares
    (% of offering price).................................   4.75%      None     4.75%      None     4.75%      None
  Sales charges on reinvested distributions to
    shareholders..........................................    None      None      None      None      None      None
  Deferred sales charges..................................    None     5.00%      None     5.00%      None     5.00%
  Redemption charges......................................    None      None      None      None      None      None
  Exchange fees:
      -- On first four exchanges each year................    None      None      None      None      None      None
      -- On each additional exchange......................   $7.50     $7.50     $7.50     $7.50     $7.50     $7.50
ANNUAL FUND OPERATING EXPENSES:
  (AS A % OF AVERAGE NET ASSETS)
  Investment management and administration fees (after
    reimbursement)........................................   0.98%     0.98%     0.93%     0.93%     0.00%     0.00%
  12b-1 service and distribution fees.....................   0.50%     1.00%     0.50%     1.00%     0.50%     1.00%
  Other expenses (after reimbursements)...................   0.50%     0.50%     0.37%     0.37%     1.90%     1.90%
                                                            -------   -------   -------   -------   -------   -------
  Total Fund Operating Expenses (after reimbursements)....   1.98%     2.48%     1.80%     2.30%     2.40%     2.90%
                                                            -------   -------   -------   -------   -------   -------
                                                            -------   -------   -------   -------   -------   -------
</TABLE>

<TABLE>
<CAPTION>
                                                                                            GT GLOBAL
                                                    GT GLOBAL           GT GLOBAL       CONSUMER PRODUCTS
                                                 INFRASTRUCTURE     NATURAL RESOURCES          AND
                                                      FUND                FUND            SERVICES FUND
                                                -----------------   -----------------   -----------------
                                                CLASS A   CLASS B   CLASS A   CLASS B   CLASS A   CLASS B
                                                -------   -------   -------   -------   -------   -------
SHAREHOLDER TRANSACTION COSTS:
<S>                                             <C>       <C>       <C>       <C>       <C>       <C>
  Maximum sales charge on purchases of shares
     (% of offering price)....................   4.75%      None     4.75%      None     4.75%      None
  Sales charges on reinvested distributions to
     shareholders.............................    None      None      None      None      None      None
  Deferred sales charges......................    None     5.00%      None     5.00%      None     5.00%
  Redemption charges..........................    None      None      None      None      None      None
  Exchange fees:
      -- On first four exchanges each year....    None      None      None      None      None      None
      -- On each additional exchange..........   $7.50     $7.50     $7.50     $7.50     $7.50     $7.50
ANNUAL FUND OPERATING EXPENSES:
  (AS A % OF AVERAGE NET ASSETS)
  Investment management and administration
     fees (after reimbursement)...............   0.04%     0.04%     0.00%     0.00%     0.98%     0.98%
  12b-1 service and distribution fees.........   0.50%     1.00%     0.50%     1.00%     0.50%     1.00%
  Other expenses (after reimbursements).......   1.86%     1.86%     1.90%     1.90%     0.80%     0.80%
                                                -------   -------   -------   -------   -------   -------
  Total Fund Operating Expenses (after
     reimbursements)..........................   2.40%     2.90%     2.40%     2.90%     2.28%     2.78%
                                                -------   -------   -------   -------   -------   -------
                                                -------   -------   -------   -------   -------   -------
</TABLE>

- --------------
Sales charge waivers are available for Class A and Class B shares, and reduced
sales charge purchase plans are available for Class A shares. The maximum 5%
contingent deferred sales charge on Class B shares applies to redemptions during
the first year after purchase. The charge generally declines by 1% annually
thereafter, reaching zero after six years. See "How to Invest."

                               Prospectus Page 9
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------

HYPOTHETICAL EXAMPLE OF EFFECT OF EXPENSES*:
An investor would have directly or indirectly paid the following expenses at the
end of the periods shown on a $1,000 investment in the Funds, assuming a 5%
annual return:
<TABLE>
<CAPTION>
                                                 GT GLOBAL             GT GLOBAL TELECOMMUNICATIONS
                                                HEALTH CARE
                                                  FUND (1)                       FUND (1)
                                        ----------------------------   ----------------------------
                                        ONE    THREE   FIVE     TEN    ONE    THREE   FIVE     TEN
                                        YEAR   YEARS   YEARS   YEARS   YEAR   YEARS   YEARS   YEARS
                                        ----   -----   -----   -----   ----   -----   -----   -----
<S>                                     <C>    <C>     <C>     <C>     <C>    <C>     <C>     <C>
Class A Shares (1)....................  $67    $107    $149    $265    $66    $102    $140    $247
Class B Shares
  Assuming a complete redemption at
   end of period (2)..................  $75    $106    $150    $278    $73    $101    $141    $260
  Assuming no redemption..............  $25    $ 76    $130    $278    $23    $ 71    $121    $260

<CAPTION>

                                                 GT GLOBAL
                                             FINANCIAL SERVICES
                                                  FUND (2)
                                        ----------------------------
                                        ONE    THREE   FIVE     TEN
                                        YEAR   YEARS   YEARS   YEARS
                                        ----   -----   -----   -----
<S>                                     <C>    <C>     <C>     <C>
Class A Shares (1)....................  $72    $119    $169    $306
Class B Shares
  Assuming a complete redemption at
   end of period (2)..................  $79    $119    $171    $319
  Assuming no redemption..............  $29    $ 89    $151    $319
</TABLE>

<TABLE>
<CAPTION>
                                                                                                                GT GLOBAL
                                                                                                                 CONSUMER
                                                          GT GLOBAL                      GT GLOBAL             PRODUCTS AND
                                                        INFRASTRUCTURE               NATURAL RESOURCES           SERVICES
                                                           FUND (2)                       FUND (2)                 FUND
                                                 ----------------------------   ----------------------------   ------------
                                                 ONE    THREE   FIVE     TEN    ONE    THREE   FIVE     TEN    ONE    THREE
                                                 YEAR   YEARS   YEARS   YEARS   YEAR   YEARS   YEARS   YEARS   YEAR   YEARS
                                                 ----   -----   -----   -----   ----   -----   -----   -----   ----   -----
<S>                                              <C>    <C>     <C>     <C>     <C>    <C>     <C>     <C>     <C>    <C>
Class A Shares (1).............................  $72    $119    $169    $306    $72    $119    $169    $306    $70    $116
Class B Shares
  Assuming a complete redemption at end of
   period (2)..................................  $79    $119    $171    $319    $79    $119    $171    $319    $78    $115
  Assuming no redemption.......................  $29    $ 89    $151    $319    $29    $ 89    $151    $319    $28    $ 85
</TABLE>

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

(1) Assumes payment of maximum sales charge by investor.

(2) Assumes deduction of maximum applicable contingent deferred sales charge.

+   The Funds are authorized to offer Advisor Class shares to certain categories
    of investors. See "Alternative Purchase Plan." Advisor Class shares are not
    subject to a distribution or service fee. "Total Fund Operating Expenses"
    for the Advisor Class shares are estimated to approximate 1.48% for the
    Health Care Fund, 1.30% for the Telecommunications Fund, 1.90% for the
    Financial Services Fund, 1.78% for the Consumer Products and Services Fund,
    1.90% for the Infrastructure Fund, and 1.90% for the Natural Resources Fund.

*   THESE TABLES ARE INTENDED TO ASSIST INVESTORS IN UNDERSTANDING THE VARIOUS
    COSTS AND EXPENSES ASSOCIATED WITH INVESTING IN THE FUNDS. Expenses for the
    Health Care Fund and Telecommunications Fund are based on the Funds' fiscal
    year ended October 31, 1994, while the expenses for the Financial Services
    Fund, Infrastructure Fund and Natural Resources Fund and their corresponding
    Portfolios are after expense reimbursements and are based on the fiscal
    period May 31, 1994 (commencement of operations) to October 31, 1994.
    Because the Consumer Products and Services Fund and its corresponding
    Portfolio commenced operations only on December 30, 1994, "Other expenses"
    are based on estimated amounts for the first year of operations of such Fund
    and its Portfolio. Long-term shareholders may pay more than the economic
    equivalent of the maximum front-end sales charge permitted by the National
    Association of Securities Dealers, Inc. ("NASD") rules regarding investment
    companies. "Other expenses" include custody, transfer agency, legal, audit
    and other operating expenses. "Other expenses" may be reduced to the extent
    that (i) certain broker/dealers executing the Health Care Fund,
    Telecommunications Fund or the Portfolios' portfolio transactions pay all or
    a portion of custodian fees and transfer agency expenses, or (ii) fees
    received in connection with the lending of portfolio securities are used to
    reduce custodian fees. These arrangements are not anticipated to materially
    increase the brokerage commissions paid by the Health Care Fund,
    Telecommunications Fund or the Portfolios. For the fiscal year ended October
    31, 1994, without such reductions, "Other expenses" for Health Care Fund,
    Telecommunications Fund, Financial Services Fund and its corresponding
    Portfolio, Infrastructure Fund and its corresponding Portfolio, Natural
    Resources Fund and its corresponding Portfolio would have been 0.52%, 0.41%,
    1.94%, 1.86% and 1.92%, respectively, for Class A shares and 0.52%, 0.41%,
    1.94%, 1.86% and 1.92%, respectively, for Class B shares. See "Management"
    herein and in the Statement of Additional Information for more information.
    THE "HYPOTHETICAL EXAMPLE" SET FORTH ABOVE IS NOT A REPRESENTATION OF PAST
    OR FUTURE EXPENSES. THE FUNDS' AND THE PORTFOLIOS' ACTUAL EXPENSES MAY BE
    MORE OR LESS THAN THOSE SHOWN.

    Without reimbursements, "Investment management and administration fees,"
    "Other expenses" and "Total Fund Operating Expenses" for Class A shares of
    the Financial Services Fund and its corresponding Portfolio would have been
    0.975%, 8.85% and 10.32%, respectively, and the amount of expenses an
    investor would pay, assuming redemption after one, three, five and ten
    years, would be $151, $331, $493 and $829, respectively. Without
    reimbursements, "Investment management and administration fees," "Other
    expenses" and "Total Fund Operating Expenses" for Class B shares of the
    Financial Services Fund and its Portfolio would have been 0.975%, 8.85% and
    16.52%, respectively, and the amount of expenses an investor would pay,
    assuming redemption after one,

                               Prospectus Page 10
<PAGE>
                             GT GLOBAL THEME FUNDS

                               PROSPECTUS SUMMARY
                                  (Continued)
- --------------------------------------------------------------------------------
    three, five and ten years would be $158, $336, $502, and $838, respectively.
    Assuming no redemption, the amount of expenses an investor would pay after
    one, three, five and ten years, would be $108, $306, $482 and $838,
    respectively.

    Without reimbursements, "Investment management and administration fees,"
    "Other expenses" and "Total Fund Operating Expenses" for Class A shares of
    the Infrastructure Fund and its Portfolio would have been 0.975%, 1.80% and
    3.28%, respectively, and the amount of expenses an investor would pay,
    assuming redemption after one, three, five and ten years, would be $80,
    $144, $211 and $387, respectively. Without reimbursements, "Investment
    management and administration fees," "Other expenses" and "Total Fund
    Operating Expenses" for Class B shares of Infrastructure Fund and its
    Portfolio would have been 0.975%, 1.80% and 3.78%, respectively, and the
    amount of expenses an investor would pay, assuming redemption after one,
    three, five and ten years, would be $88, $145, $214 and $399, respectively.
    Assuming no redemption, the amount of expenses an investor would pay after
    one, three, five and ten years, would be $38, $115, $194 and $399,
    respectively.

    Without reimbursements, "Investment management and administration fees,"
    "Other expenses" and "Total Fund Operating Expenses" for Class A shares of
    Natural Resources Fund and its Portfolio would have been 0.975%, 2.90% and
    4.38%, respectively, and the amount of expenses an investor would pay,
    assuming redemption after one, three, five and ten years, would be $91,
    $176, $261 and $479, respectively. Without reimbursements, "Investment
    management and administration fees," "Other expenses" and "Total Fund
    Operating Expenses" for Class B shares of Natural Resources Fund and its
    Portfolio would have been 0.975%, 2.90% and 4.88%, respectively, and the
    amount of expenses an investor would pay, assuming redemption after one,
    three, five and ten years would be $99, $177, $265, and $491, respectively.
    Assuming no redemption, the amount of expenses an investor would pay after
    one, three, five and ten years would be $49, $147, $245 and $491,
    respectively.

    The above table and the assumption in the Hypothetical Example of a 5%
    annual return are required by regulation of the Securities and Exchange
    Commission applicable to all mutual funds. The 5% annual return is not a
    prediction of and does not represent the Funds' or the Portfolios' projected
    or actual performance.

    The Annual Fund Operating Expenses for the Consumer Products and Services
    Fund and its corresponding Portfolio are annualized projections based upon
    current administration fees for the Fund and management and administration
    fees for the Portfolio and estimated amounts for Other expenses. The Board
    of Directors of the Company believes that the aggregate per share expenses
    of the Financial Services Fund, Infrastructure Fund, Natural Resources Fund
    and Consumer Products and Services Fund and each of their corresponding
    Portfolios will be approximately equal to the expenses such Fund would incur
    if its assets were invested directly in the type of securities being held by
    its corresponding Portfolio. If investors other than such Fund invest in its
    corresponding Portfolio, such Funds could achieve economies of scale which
    could reduce expenses.

                               Prospectus Page 11
<PAGE>
                             GT GLOBAL THEME FUNDS

                              FINANCIAL HIGHLIGHTS

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

The tables below provide condensed financial information concerning income and
capital changes for one share of each class of shares of the Fund for the
periods shown. This information is supplemented by the financial statements and
accompanying notes appearing in the Statement of Additional Information. The
financial statements and notes for the fiscal year ended October 31, 1994, have
been audited by Coopers & Lybrand, L.L.P., independent accountants, whose report
thereon is also included in the Statement of Additional Information.

                           GT GLOBAL HEALTH CARE FUND
<TABLE>
<CAPTION>
                                                             CLASS B++
                                                     -------------------------
                                                                    APRIL 1,
                                                     YEAR ENDED       1993
                                                     OCTOBER 31,   TO OCTOBER
                                                        1994*       31, 1993*
                                                     -----------   -----------
<S>                                                  <C>           <C>
Per Share Operating Performance:
Net asset value, beginning of period...............    $ 17.80       $ 15.59
                                                     -----------   -----------
Income from investment operations:
  Net investment income (loss).....................      (0.32)        (0.14)
  Net realized and unrealized gain (loss) on
   investments.....................................       2.02          2.35
                                                     -----------   -----------
  Net increase (decrease) from investment
   operations......................................       1.70          2.21
                                                     -----------   -----------
Distributions:
  Net investment income............................      (0.00)        (0.00)
  Net realized gain on investments.................      (0.00)        (0.00)
  In excess of net realized gain on investments....      (0.04)        (0.00)
                                                     -----------   -----------
    Total distributions............................      (0.04)        (0.00)
                                                     -----------   -----------
Net asset value, end of period.....................    $ 19.46       $ 17.80
                                                     -----------   -----------
                                                     -----------   -----------
Total investment return (c)........................      9.55%         14.2%(a)

Ratios and supplemental data:
Net assets, end of period (in 000's)...............    $39,100       $ 8,604
Ratio of net investment income (loss) to average
 net assets........................................    (1.73)%        (1.4)%(b)
Ratio of expenses to average net assets before
 expense reductions................................      2.50%
Ratio of expenses to average net assets............      2.48%          2.5%(b)
Portfolio turnover rate +++........................        64%           61%

<CAPTION>
                                                                                CLASS A+
                                                     ---------------------------------------------------------------
                                                                                                         AUGUST 7,
                                                                                                           1989
                                                                                                       (COMMENCEMENT
                                                                                                            OF
                                                                  YEAR ENDED OCTOBER 31,                OPERATIONS)
                                                     ------------------------------------------------   TO OCTOBER
                                                      1994*     1993*      1992      1991      1990      31, 1989
                                                     --------  --------  --------  --------  --------  -------------
<S>                                                  <C>       <C>       <C>       <C>       <C>       <C>
Per Share Operating Performance:
Net asset value, beginning of period...............  $  17.86  $  17.44  $  19.29  $  12.83  $  11.83     $ 11.43
                                                     --------  --------  --------  --------  --------  -------------
Income from investment operations:
  Net investment income (loss).....................     (0.22)    (0.15)    (0.18)     0.03      0.06        0.01
  Net realized and unrealized gain (loss) on
   investments.....................................      2.02      0.57     (1.53)     6.78      0.97        0.39
                                                     --------  --------  --------  --------  --------  -------------
  Net increase (decrease) from investment
   operations......................................      1.80      0.42     (1.71)     6.81      1.03        0.40
                                                     --------  --------  --------  --------  --------  -------------
Distributions:
  Net investment income............................     (0.00)    (0.00)    (0.00)    (0.07)    (0.03)      (0.00)
  Net realized gain on investments.................     (0.00)    (0.00)    (0.14)    (0.28)    (0.00)      (0.00)
  In excess of net realized gain on investments....     (0.06)    (0.00)    (0.00)    (0.00)    (0.00)      (0.00)
                                                     --------  --------  --------  --------  --------  -------------
    Total distributions............................     (0.06)    (0.00)    (0.14)    (0.35)    (0.03)      (0.00)
                                                     --------  --------  --------  --------  --------  -------------
Net asset value, end of period.....................  $  19.60  $  17.86  $  17.44  $  19.29  $  12.83     $ 11.83
                                                     --------  --------  --------  --------  --------  -------------
                                                     --------  --------  --------  --------  --------  -------------
Total investment return (c)........................    10.11%      2.4%    (8.9)%     54.2%      8.7%        3.5%(a)
Ratios and supplemental data:
Net assets, end of period (in 000's)...............  $438,940  $461,113  $655,867  $552,897  $145,544     $49,903
Ratio of net investment income (loss) to average
 net assets........................................   (1.23)%    (0.9)%    (1.0)%      0.2%      0.7%        3.2%(b)
Ratio of expenses to average net assets before
 expense reductions................................     2.00%
Ratio of expenses to average net assets............     1.98%      2.0%      2.1%      2.0%      2.4%        2.5%(b)
Portfolio turnover rate +++........................       64%       61%       30%       23%       34%        183%(b)
</TABLE>

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

+   All capital shares issued and outstanding as of March 31, 1993, were
    reclassified as Class A shares.

++  Commencing April 1, 1993, the Fund began offering Class B shares.

+++ Portfolio turnover is calculated on the basis of the Fund as a whole without
    distinguishing between the classes of shares issued.

*   These selected per share data were calculated based upon weighted average
    shares outstanding during the period.

(a) Not annualized.

(b) Annualized.

(c) Total investment return does not include sales charges.

                               Prospectus Page 12
<PAGE>
                             GT GLOBAL THEME FUNDS

                       GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
                                                                         CLASS B++
                                                          ---------------------------------------
                                                               YEAR ENDED        APRIL 1, 1993 TO
                                                          OCTOBER 31, 1994 (C)   OCTOBER 31, 1993
                                                          --------------------   ----------------
<S>                                                       <C>                    <C>
Per Share Operating Performance:
Net asset value, beginning of period....................       $    16.87            $  12.68
                                                              -----------        ----------------
Income from investment operations:
  Net investment income (loss)..........................            (0.10)               0.01
  Net realized and unrealized gain (loss) on
   investments..........................................             1.17                4.18
                                                              -----------        ----------------
  Net increase (decrease) from investment operations....             1.07                4.19
                                                              -----------        ----------------
Distributions:
  Net investment income.................................            (0.01)              (0.00)
  Net realized gain on investments......................            (0.27)              (0.00)
                                                              -----------        ----------------
    Total distributions.................................            (0.28)              (0.00)
                                                              -----------        ----------------
Net asset value, end of period..........................       $    17.66            $  16.87
                                                              -----------        ----------------
                                                              -----------        ----------------
Total investment return (d).............................            6.50%               33.0%(a)

Ratios and supplemental data:
Net assets, end of period (in 000's)....................       $1,184,081            $455,335
Ratio of net investment income to average net assets....          (0.52)%                0.3%(b)
Ratio of expenses to average net assets before expense
 reductions.............................................            2.34%
Ratio of expenses to average net assets.................            2.30%                2.5%(b)
Portfolio turnover rate+++..............................              57%                 41%

<CAPTION>
                                                                                    CLASS A+
                                                          -------------------------------------------------------------

                                                                                                     JANUARY 27, 1992

                                                                                                       (COMMENCEMENT

                                                               YEAR ENDED           YEAR ENDED       OF OPERATIONS) TO

                                                          OCTOBER 31, 1994 (C)   OCTOBER 31, 1993    OCTOBER 31, 1992

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

<S>                                                       <C>                    <C>                <C>
Per Share Operating Performance:
Net asset value, beginning of period....................       $    16.92           $    11.16           $  11.43

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

Income from investment operations:
  Net investment income (loss)..........................            (0.01)                0.08               0.14*

  Net realized and unrealized gain (loss) on
   investments..........................................             1.17                 5.83              (0.41)

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

  Net increase (decrease) from investment operations....             1.16                 5.91              (0.27)

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

Distributions:
  Net investment income.................................            (0.01)               (0.15)             (0.00)

  Net realized gain on investments......................            (0.27)               (0.00)             (0.00)

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

    Total distributions.................................            (0.28)               (0.15)             (0.00)

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

Net asset value, end of period..........................       $    17.80           $    16.92           $  11.16

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

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

Total investment return (d).............................            7.02%                53.6%             (2.4)%(a)

Ratios and supplemental data:
Net assets, end of period (in 000's)....................       $1,644,402           $1,223,340           $442,862

Ratio of net investment income to average net assets....          (0.02)%                 0.8%               2.1%*(b)

Ratio of expenses to average net assets before expense
 reductions.............................................            1.84%
Ratio of expenses to average net assets.................            1.80%                 2.0%               2.3%*(b)

Portfolio turnover rate+++..............................              57%                  41%                 4%(b)

</TABLE>

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

+   All capital shares issued and outstanding as of March 31, 1993, were
    reclassified as Class A shares.

++  Commencing April 1, 1993, the Fund began offering Class B shares.

+++ Portfolio turnover is calculated on the basis of the Fund as a whole without
    distinguishing between the classes of shares issued.

*   Includes reimbursement by LGT Asset Management, Inc. of Fund operating
    expenses of less than $0.01. Without such reimbursement, the annualized
    expense ratio would have been 2.30% and the annualized ratio of net
    investment income to average net assets would have been 2.04%.

(a) Not annualized.

(b) Annualized.

(c) These selected per share data were calculated based upon weighted average
    shares outstanding during the period.

(d) Total investment return does not include sales charges.

                               Prospectus Page 13
<PAGE>
                             GT GLOBAL THEME FUNDS
<TABLE>
<CAPTION>
                                                             GT GLOBAL                                 GT GLOBAL
                                                         FINANCIAL SERVICES                          INFRASTRUCTURE
                                                                FUND                                      FUND
                                              ----------------------------------------  ----------------------------------------
                                                   CLASS B              CLASS A              CLASS B              CLASS A
                                              ------------------  --------------------  ------------------  --------------------
                                                 MAY 31, 1994         MAY 31, 1994         MAY 31, 1994         MAY 31, 1994
                                               (COMMENCEMENT OF     (COMMENCEMENT OF     (COMMENCEMENT OF     (COMMENCEMENT OF
                                                OPERATIONS) TO       OPERATIONS) TO       OPERATIONS) TO       OPERATIONS) TO
                                               OCTOBER 31, 1994     OCTOBER 31, 1994     OCTOBER 31, 1994     OCTOBER 31, 1994
                                              ------------------  --------------------  ------------------  --------------------
<S>                                           <C>                 <C>                   <C>                 <C>
Per Share Operating Performance:
Net asset value, beginning of period........     $      11.43         $      11.43        $        11.43      $          11.43
                                                   ----------           ----------      ------------------         -----------
  Income from investment operations:
  Net investment income+....................             0.00                 0.02                 (0.01)                 0.01
  Net realized and unrealized gain (loss) on
   investments..............................             0.17***              0.17***               1.03                  1.03
                                                   ----------           ----------      ------------------         -----------
Net increase (decrease) from investment
 operations.................................             0.17                 0.19                  1.02                  1.04
                                                   ----------           ----------      ------------------         -----------
Net asset value, end of period..............     $      11.60         $      11.62        $        12.45      $          12.47
                                                   ----------           ----------      ------------------         -----------
                                                   ----------           ----------      ------------------         -----------
Total investment return (c).................            1.49%(b)             1.66%(b)              8.92%(b)              9.10%(b)

Ratios and supplemental data:
Net assets, end of period
 (in 000's).................................     $      2,235         $      3,175        $       30,954      $         23,615
Ratio of net investment income to average
 net assets.................................            0.16%**(a)            0.66%*(a)          (0.09)%**(a)              0.41%*(a)
Ratio of expenses
 to average net assets
 before expense reductions..................            2.94%                2.44%                 2.90%                 2.40%
Ratio of expenses to average net assets.....            2.90%**(a)            2.40%*(a)            2.90%**(a)              2.40%*(a)

<CAPTION>
                                                             GT GLOBAL
                                                         NATURAL RESOURCES
                                                                FUND
                                              ----------------------------------------

                                                   CLASS B              CLASS A
                                              ------------------  --------------------
                                                 MAY 31, 1994         MAY 31, 1994
                                               (COMMENCEMENT OF     (COMMENCEMENT OF
                                                OPERATIONS) TO       OPERATIONS) TO
                                               OCTOBER 31, 1994     OCTOBER 31, 1994
                                              ------------------  --------------------
<S>                                           <C>                 <C>
Per Share Operating Performance:
Net asset value, beginning of period........    $        11.43        $      11.43
                                              ------------------        ----------
  Income from investment operations:
  Net investment income+....................              0.03                0.06
  Net realized and unrealized gain (loss) on
   investments..............................              0.92                0.92
                                              ------------------        ----------
Net increase (decrease) from investment
 operations.................................              0.95                0.98
                                              ------------------        ----------
Net asset value, end of period..............    $        12.38        $      12.41
                                              ------------------        ----------
                                              ------------------        ----------
Total investment return (c).................             8.31%(b)            8.57%(b)
Ratios and supplemental data:
Net assets, end of period
 (in 000's).................................    $       13,404        $     14,797
Ratio of net investment income to average
 net assets.................................             2.13%**(a)            2.63%*(a)
Ratio of expenses
 to average net assets
 before expense reductions..................             2.92%               2.42%
Ratio of expenses to average net assets.....             2.90%**(a)            2.40%*(a)
</TABLE>

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

*   The annualized ratios of operating expenses and net investment income to
    average net assets for Class A shares of Financial Services Fund,
    Infrastructure Fund and Natural Resources Fund before reimbursement by LGT
    Asset Managment, Inc. for the period ended October 31, 1994 would have been
    10.32% and (7.26)%; 3.28% and (0.47)%; and 4.38% and 0.65%, respectively.

**  The annualized ratios of operating expenses and net investment income to
    average net assets for Class B shares of Financial Services Fund,
    Infrastructure Fund and Natural Resources Fund before reimbursement by LGT
    Asset Management, Inc. for the period ended October 31, 1994 would have been
    10.82% and (7.76)%; 3.78% and (0.97)%; and 4.88% and 0.15%, respectively.

*** The per share amount does not correspond with the net realized and
    unrealized gain for the period due to the timing of the sales of Fund shares
    and the amount of per share realized and unrealized gains and losses at such
    time.

+   The net investment income per share before reimbursement by LGT Asset
    Management, Inc. for both classes of shares of Financial Services Fund,
    Infrastructure Fund and Natural Resources Fund would have been reduced by
    $0.23, $0.02 and $0.04, respectively.

(a) Annualized.

(b) Not annualized.

(c) Total investment return does not include sales charges.

                               Prospectus Page 14
<PAGE>
                             GT GLOBAL THEME FUNDS

                           ALTERNATIVE PURCHASE PLAN

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

DIFFERENCES BETWEEN THE CLASSES. The primary distinction between the two classes
of each Fund's shares offered through this Prospectus lies in their sales charge
structures and ongoing expenses, as summarized below. Class A and Class B shares
of each Fund represent interests in the same portfolio of investments of that
Fund and have the same rights, except that each class bears the separate
expenses of its Rule 12b-1 distribution plan and has exclusive voting rights
with respect to such plan, and each class has a separate exchange privilege. See
"Management" and "How to Make Exchanges." Each class has distinct advantages and
disadvantages for different investors, and investors should choose the class
that better suits their circumstances and objectives.

Dividends and other distributions paid by each Fund with respect to its Class A
and Class B shares are calculated in the same manner and at the same time. The
per share dividends on Class B shares of each Fund will be lower than the per
share dividends on Class A shares of that Fund as a result of the higher service
and distribution fees applicable to Class B shares.

CLASS A SHARES. Class A shares of each Fund are sold at net asset value plus an
initial sales charge of up to 4.75% of the public offering price imposed at the
time of purchase. This initial sales charge is reduced or waived for certain
purchases. Purchases of $500,000 or more must be for Class A shares. Class A
shares of each Fund also bear annual service and distribution fees of up to
0.50% of the average daily net assets of that class.

CLASS B SHARES. Class B shares of each Fund are sold at net asset value with no
initial sales charge at the time of purchase. Therefore, the entire amount of an
investor's purchase payment is invested in that Fund. Class B shares bear annual
service and distribution fees of up to 1.00% of the average daily net assets of
that class, and investors pay a contingent deferred sales charge of up to 5% of
the lesser of the original purchase price or the net asset value of such shares
at the time of redemption. This deferred sales charge is waived for certain
redemptions and is reduced for shares held more than one year. The higher
service and distribution fees paid by the Class B shares of each Fund should
cause that class to have a higher expense ratio and to pay lower dividends than
Class A shares of the Fund.

FACTORS TO CONSIDER IN CHOOSING A CLASS OF SHARES. In deciding which class of a
Fund to purchase, investors should consider the foregoing factors as well as the
following:

INTENDED HOLDING PERIOD. Over time, the cumulative expense of the 1.00% annual
service and distribution fees on the Class B shares of a Fund will approximate
or exceed the expense of the applicable 4.75% maximum initial sales charge plus
the 0.50% service and distribution fees on the Class A shares of a Fund. For
example, if net asset value remains constant, the Class B shares' aggregate
service and distribution fees would be equal to the Class A shares' initial
maximum sales charge and service and distribution fees approximately nine years
after purchase. Thereafter, Class B shares would bear higher expenses. Investors
who expect to maintain their investment in a Fund over the long-term but do not
qualify for a reduced initial sales charge might elect the Class A initial sales
charge alternative because the indirect expense to the shareholder of the
accumulated service and distribution fees on the Class B shares eventually will
exceed the initial sales charge paid by the shareholder plus the indirect
expense to the shareholder of the accumulated distribution fees of Class A
shares. Class B investors, however, enjoy the benefit of permitting all their
dollars to work from the time an investment is made. Any positive investment
return on this additional invested amount would partially or wholly offset the
higher annual expenses borne by Class B shares. Because the Funds' future
returns cannot be predicted, however, there can be no assurance that such a
positive return will be achieved.

Finally, Class B shareholders pay a contingent deferred sales charge if they
redeem during the first six years after purchase, unless a sales charge waiver
applies. Investors expecting to redeem during this period should consider the
cost of the applicable contingent deferred sales charge in addition to the
annual Class B service and distribution fees, as compared with the cost of the
applicable initial sales charge and annual service and distribution fees
applicable to the Class A shares.

                               Prospectus Page 15
<PAGE>
                             GT GLOBAL THEME FUNDS

The "Hypothetical Example of Effect of Expenses" under "Prospectus Summary"
shows for each Fund the cumulative expenses an investor would pay over time on a
hypothetical investment in each class of each Fund's shares, assuming an annual
return of 5%.

REDUCED SALES CHARGES. Class A share purchases over $50,000 and Class A share
purchases made under a Fund's reduced sales charge plans may be made at a
reduced initial sales charge. See "How to Invest" for a complete list of reduced
sales charges applicable to Class A purchases.

WAIVER OF SALES CHARGES. The entire initial sales charge on Class A shares of a
Fund may be waived for certain eligible purchasers and these purchasers' entire
purchase price would be immediately invested in that Fund. The contingent
deferred sales charge may be waived upon redemption of certain Class B shares of
a Fund. Investors eligible for complete initial sales charge waivers should
purchase Class A shares. See "How to Invest" for a complete list of initial
sales charge waivers applicable to Class A purchases and contingent deferred
sales charge waivers applicable to Class B purchases. A 1% contingent deferred
sales charge is imposed on certain redemptions of Class A shares on which no
initial sales charge was assessed.

Investors should understand that the contingent deferred sales charge on the
Class B shares and the initial sales charge on the Class A shares are both
intended to compensate GT Global and selling broker/dealers for their
distribution services. Broker/dealers may receive different levels of
compensation for selling a particular class of shares of the Funds.

ADVISOR CLASS SHARES. Advisor Class shares may be offered through a separate
prospectus to (a) trustees or other fiduciaries purchasing shares for employee
benefit plans which are sponsored by organizations which have at least 1,000
employees; (b) any account with assets of at least $25,000 if (i) a financial
planner, trust company, bank trust department or registered investment adviser
has investment discretion over such account, and (ii) the account holder pays
such person as compensation for its advice and other services an annual fee of
at least .50% on the assets in the account; (c) any account with assets of at
least $25,000 if (i) such account is established under a "wrap fee" program, and
(ii) the account holder pays the sponsor of such program an annual fee of at
least .50% on the assets in the account; (d) accounts advised by one of the
companies comprising or affiliated with Liechtenstein Global Trust; and (e) any
of the companies comprising or affiliated with Liechtenstein Global Trust.

See "How to Invest," "How to Redeem Shares," and "Management" for a more
complete description of the initial and contingent deferred sales charges,
service fees and distribution fees for Class A and Class B shares of each Fund
and "Dividends, Other Distributions and Federal Income Taxation," and "Valuation
of Shares" for other differences between these two classes.

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

                              INVESTMENT OBJECTIVE
                                  AND POLICIES

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

FINANCIAL SERVICES FUND
The Financial Services Fund's investment objective is long-term capital growth.
The Financial Services Fund seeks its objective by investing all of its
investable assets in the Financial Services Portfolio, that, in turn invests
primarily in equity securities of companies throughout the world that operate in
the financial services industry. The Financial Services Portfolio's investment
objective is identical to that of the Financial Services Fund. The Financial
Services Portfolio invests in financial services companies which, in the opinion
of LGT Asset Management, have potential for above average, long-term growth in
sales and earnings on a sustained basis. There is no assurance that the
Financial Services Fund or the Financial Services Portfolio will achieve its
investment objective.

At least 65% of the Financial Services Portfolio's total assets normally will be
invested in common and preferred stocks and warrants to acquire such securities,
issued by companies in the financial services industry. A "financial services"
company is an entity in which (i) at least 50% of either the revenues or
earnings was derived from financial services activities, or (ii) at least 50% of
the assets was devoted to such activities, based on the company's most recent
fiscal year. The remainder of

                               Prospectus Page 16
<PAGE>
                             GT GLOBAL THEME FUNDS
the Financial Services Portfolio's assets may be invested in debt securities
issued by financial services companies and/or equity and debt securities of
companies outside of the financial services industry, which, in the opinion of
LGT Asset Management, stand to benefit from developments in the financial
services industry.

In analyzing companies for investment by the Financial Services Portfolio, LGT
Asset Management ordinarily looks for several of the following characteristics:
above-average per share earnings growth; high return on invested capital; a
healthy balance sheet; sound financial and accounting policies and overall
financial strength; strong competitive advantages; efficient service; pricing
flexibility; strong management; and general operating characteristics which will
enable the companies to compete successfully in their respective markets.

GLOBAL FINANCIAL SERVICES INDUSTRY INVESTMENT.  Examples of financial services
companies include those providing financial services to consumers and industry
including the following and their foreign equivalents: commercial banks and
savings institutions and loan associations and their holding companies; consumer
and industrial finance companies; diversified financial services companies;
investment banking; insurance brokerages; securities brokerage and investment
advisory companies; real estate-related companies; leasing companies; and a
variety of firms in all segments of the insurance field such as multi-line,
property and casualty and life insurance and insurance holding companies.

LGT Asset Management believes an accelerating rate of global economic
interdependence will lead to significant growth in the demand for financial
services. In addition, in LGT Asset Management's view, as the industry evolves,
opportunities will emerge for those companies positioned for the future. Thus,
LGT Asset Management expects that banking and related financial institution
consolidation in the developed countries, increased demand for retail borrowing
in developing countries, a growing need for international trade-based financing,
a rising demand for sophisticated risk management, the proliferating number of
liquid securities markets around the world, and larger concentrations of
investable assets should lead to growth in financial service companies that are
positioned for the future.

INFRASTRUCTURE FUND
The Infrastructure Fund's investment objective is long-term capital growth. The
Infrastructure Fund seeks its objective by investing all of its investable
assets in the Infrastructure Portfolio, that, in turn, invests primarily in
equity securities of companies throughout the world that design, develop or
provide products and services significant to a country's infrastructure. The
Infrastructure Portfolio's investment objective is identical to that of the
Infrastructure Fund. The Infrastructure Portfolio invests in infrastructure
companies which, in the opinion of LGT Asset Management, have potential for
above average, long-term growth in sales and earnings on a sustained basis.
There is no assurance that the Infrastructure Fund or the Infrastructure
Portfolio will achieve its investment objective.

At least 65% of the Infrastructure Portfolio's total assets normally will be
invested in common stocks and preferred stocks and warrants to acquire such
securities issued by infrastructure companies. An "infrastructure" company is an
entity in which (i) at least 50% of either the revenues or earnings was derived
from infrastructure activities, or (ii) at least 50% of the assets was devoted
to such activities, based on the company's most recent fiscal year. The
remainder of the Infrastructure Portfolio's assets may be invested in debt
securities issued by infrastructure companies and/or equity and debt securities
of companies outside of the infrastructure industries, which, in the opinion of
LGT Asset Management, stand to benefit from developments in the infrastructure
industries.

In analyzing companies for investment by the Infrastructure Portfolio, LGT Asset
Management ordinarily looks for several of the following characteristics:
above-average per share earnings growth; high return on invested capital; a
healthy balance sheet; sound financial and accounting policies and overall
financial strength; strong competitive advantages; effective research and
product development and marketing; development of new technologies; efficient
service; pricing flexibility; strong management; and general operating
characteristics that will enable the companies to compete successfully in their
respective markets.

GLOBAL INFRASTRUCTURE INDUSTRIES INVESTMENT.  For purposes of the Infrastructure
Portfolio's policy of investing at least 65% of its total assets in the
securities of infrastructure companies, the companies in which the
Infrastructure Portfolio will principally

                               Prospectus Page 17
<PAGE>
                             GT GLOBAL THEME FUNDS
invest will be those engaged in designing, developing or providing the following
products and services: electricity production; oil, gas, and coal exploration,
development, production and distribution; water supply, including water
treatment facilities; nuclear power and other alternative energy sources;
transportation, including the construction or operation of transportation
systems; steel, concrete, or similar types of products; communications equipment
and services (including equipment and services for both data and voice
transmission); mobile communications and cellular radio/paging; emerging
technologies combining telephone, television and/or computer systems; and other
products and services, which, in LGT Asset Management's judgment, constitute
services significant to the development of a country's infrastructure.

In addition, long-term growth rates of certain foreign countries' economies may
be substantially higher than those of the U.S. economy. An integral aspect of
the foreign countries' economies may be the development or improvement of their
infrastructure.

LGT Asset Management believes that a country's infrastructure is one key to the
long-term success of that country's economy. LGT Asset Management believes that
adequate energy, transportation, water, and communications systems are essential
elements for long-term economic growth. LGT Asset Management believes that many
developing nations, especially in Asia and Latin America, plan to make
significant expenditures to the development of their infrastructure in the
coming years, which is expected to facilitate increased levels of services and
manufactured goods.

In the developed countries of North America, Europe, Japan and the south
Pacific, LGT Asset Management expects that the replacement and upgrade of
transportation and communications systems should stimulate growth in the
industries of those countries. In LGT Asset Management's view, deregulation of
telecommunications and electric and gas utilities in many countries is promoting
significant changes in these industries.

LGT Asset Management believes that strong economic growth in developing
countries and infrastructure replacement, upgrade, and deregulation in more
developed countries provide an environment for favorable investment
opportunities in infrastructure companies worldwide.

NATURAL RESOURCES FUND
The Natural Resources Fund's investment objective is long-term capital growth.
The Natural Resources Fund seeks its objective by investing all of its
investable assets in the Natural Resources Portfolio, that, in turn, invests
primarily in equity securities of companies throughout the world that own,
explore or develop natural resources and other basic commodities, or supply
goods and services to such companies. The Natural Resources Portfolio's
investment objective is identical to that of the Natural Resources Fund. The
Natural Resources Portfolio expects to principally invest in those natural
resource companies that own, explore or develop energy sources; ferrous and
non-ferrous metals, strategic metals and precious metals, chemicals, forest
products, foodstuffs, refined products, such as steel and other basic
commodities, which, in LGT Asset Management's opinion, historically have been
produced and marketed profitably during periods of improving supply and demand
fundamentals and rising inflation. The Natural Resources Portfolio invests in
natural resource companies which, in the opinion of LGT Asset Management, have
potential for above average, long-term growth in sales and earnings. There is no
assurance that the Natural Resources Fund or the Natural Resources Portfolio
will achieve its investment objective.

At least 65% of the Natural Resources Portfolio's total assets will normally be
invested in common stock and preferred stock, and warrants to acquire such
securities, issued by natural resource companies. A "natural resource" company
is an entity in which (i) at least 50% of either the revenues or earnings was
derived from natural resource activities, or (ii) at least 50% of the assets was
devoted to such activities, based upon the company's most recent fiscal year.
The remainder of the Natural Resources Portfolio's assets may be invested in
debt securities issued by natural resource companies and/or equity and debt
securities of companies outside of the natural resource industries, which, in
the opinion of LGT Asset Management, stand to benefit from developments in the
natural resource industries.

The Natural Resources Portfolio may invest in securities of companies in those
natural resource industries and commodity groups which, in LGT Asset
Management's opinion, may perform well during periods of rising inflation. In
analyzing such companies for possible investment by the Natural Resources
Portfolio, LGT Asset Management

                               Prospectus Page 18
<PAGE>
                             GT GLOBAL THEME FUNDS
ordinarily looks for several of the following characteristics: above-average per
share earnings growth; high return on invested capital; a healthy balance sheet;
sound financial and accounting policies and overall financial strength; strong
competitive advantages; development of new technologies; efficient service;
strong management; and general operating characteristics that will enable the
companies to compete successfully in their respective markets.

GLOBAL NATURAL RESOURCE INDUSTRIES INVESTMENT.  The natural resource industries
are comprised of a variety of companies. For purposes of the Natural Resources
Portfolio's policy of investing at least 65% of its total assets in the
securities of natural resource companies, the companies in which the Natural
Resources Portfolio will principally invest will be those which own, explore or
develop: energy sources (such as oil, gas and coal); ferrous and non-ferrous
metals (such as iron, aluminum, copper, nickel, zinc and lead), strategic metals
(such as uranium and titanium) and precious metals (such as gold, silver and
platinum); chemicals; forest products (such as timber, coated and uncoated tree
sheet, pulp and newsprint); other basic commodities (such as foodstuffs);
refined products (such as chemicals and steel) and service companies that sell
to these producers and refiners; and other products and services, which, in LGT
Asset Management's opinion are significant to the ownership and development of
natural resources and other basic commodities.

LGT Asset Management will allocate the Natural Resources Portfolio's investments
among those natural resource companies depending on its assessment of their
long-term growth potential. In assessing these companies' long-term growth
potential, LGT Asset Management will evaluate, among other factors, their
capabilities for expanded exploration and production, superior exploration
programs and production techniques and facilities, current inventories, expected
production and demand levels and the potential to accumulate new resources.

LGT Asset Management believes that the liberalization of formerly socialist
economies will bring about dramatic changes in both the supply and demand for
natural resources. In addition, rapid industrialization in developing countries
of Asia and Latin America are generating new demands for industrial materials
that are affecting world commodities markets. LGT Asset Management believes
these changes are likely to create investment opportunities that benefit from
new sources of supply and/or from changes in commodities prices.
LGT Asset Management believes that investments in natural resource industries
offer an opportunity to protect wealth against the capital-eroding effects of
inflation. During periods of accelerating inflation or currency uncertainty,
worldwide investment demand for natural resources, particularly precious metals,
tends to increase, and during periods of disinflation or currency stability, it
tends to decrease. LGT Asset Management believes that rising commodity prices
and increasing worldwide industrial production may favorably affect share prices
of natural resource companies, and investments in such companies can offer
excellent opportunities to offset the effects of inflation.

CONSUMER PRODUCTS AND SERVICES FUND
The Consumer Products and Services Fund's investment objective is long-term
capital growth. The Consumer Products and Services Fund seeks its objective by
investing all of its investable assets in the Consumer Products and Services
Portfolio, that, in turn, invests primarily in equity securities of companies
throughout the world that manufacture, market, retail or distribute consumer
products and services. The Consumer Products and Services Portfolio's investment
objective is identical to that of the Consumer Products and Services Fund. The
Consumer Products and Services Portfolio invests in consumer products and
services companies which, in the opinion of LGT Asset Management, have potential
for above average, long-term growth in sales and earnings on a sustained basis.
There is no assurance that the Consumer Products and Services Fund or the
Consumer Products and Services Portfolio will achieve its investment objective.

At least 65% of the Fund's total assets normally will be invested in common
stocks and preferred stocks and warrants to acquire such securities issued by
companies in the consumer products and services industries. A "consumer products
or services" company is an entity in which (i) at least 50% of either the
revenues or earnings was derived from activities relating to consumer products
or services or (ii) at least 50% of the assets was devoted to such activities,
based on the company's most recent fiscal year. The remainder of the Consumer
Products and Services Portfolio's assets may be invested in debt securities
issued by consumer products or services companies and/or equity and debt
securities of companies outside the consumer products or services industries,
which, in

                               Prospectus Page 19
<PAGE>
                             GT GLOBAL THEME FUNDS
the opinion of LGT Asset Management, stand to benefit from developments in such
industries.

In analyzing companies for investment by the Consumer Products and Services
Portfolio, LGT Asset Management ordinarily looks for several of the following
characteristics: above-average per share earnings growth; high return on
invested capital; a healthy balance sheet; sound financial and accounting
policies and overall financial strength; strong management; strong and growing
market share; pricing flexibility; effective product development and marketing;
excellent products and services; superior perceived value; and general operating
characteristics which will enable the companies to compete successfully in their
respective markets.

CONSUMER PRODUCTS AND SERVICES INDUSTRIES INVESTMENT. The consumer products and
services industries are composed of a variety of companies. For the purposes of
the Consumer Products and Services Portfolio's policy of investing at least 65%
of its total assets in the securities of consumer products and services
companies, the companies in which the Consumer Products and Services Portfolio
will principally invest will be those that manufacture, market, retail, or
distribute: (i) durable goods, such as homes, household goods, automobiles,
boats, furniture and appliances, and computers; (ii) non-durable goods, such as
food and beverages and apparel; (iii) media, entertainment, broadcasting,
publishing and sports-related goods and services, such as television and radio
broadcast, motion pictures, wireless communications, gaming casinos, theme
parks, restaurants and lodging; and (iv) goods and services to companies in the
foregoing industries such as advertisers, textile companies and distribution and
shipping companies.

The Consumer Products and Services Portfolio expects that a significant portion
of its assets may be invested in the securities of U.S. issuers from time to
time, particularly those that market their products globally. However, consumer
products and services companies of a particular nation or region of the world
are often operated and owned in their local markets, close to their customers.
These companies, LGT Asset Management believes, often offer superior
opportunities for capital growth as compared to their larger, multinational
counterparts. Certain global markets may be more attractive than others from
time to time; companies dependent on U.S. markets, for example, may be
outperformed by companies not dependent on U.S. markets.

LGT Asset Management also believes that the demand for consumer products and
services worldwide will increase along with rising disposable incomes in both
developed and developing nations. Emerging economies, such as those in China,
Southeast Asia, the former Eastern Europe and Latin America, offer opportunities
for the growth and expansion of consumer markets. These regions currently
comprise a growing source of inexpensive manufacture of consumer products for
export and a growing source of demand for consumer products and services as the
disposable incomes of their populations increase. In LGT Asset Management's
view, these changes are likely to create investment opportunities in companies,
both local and multi-national, that are able to employ innovative manufacturing,
marketing, retailing and distribution methods to open new markets and/or expand
existing markets.

HEALTH CARE FUND
The Health Care Fund's investment objective is long-term capital appreciation.
The Health Care Fund seeks its objective by investing primarily in equity
securities of health care companies throughout the world. The Health Care Fund
invests in health care companies, which, in the opinion of LGT Asset Management,
have potential for above average, long-term growth in sales and earnings on a
sustained basis. There is no assurance that the Health Care Fund will achieve
its objective.

At least 65% of the Health Care Fund's total assets normally will be invested in
common and preferred stocks, and warrants to acquire such securities, issued by
health care companies. A "health care" company is an entity in which (i) at
least 50% of its revenues were derived from health care activities, or (ii) at
least 50% of its assets were devoted to such activities, based on the company's
most recent fiscal year. The remainder of the Health Care Fund's assets may be
invested in debt securities issued by health care companies and/or equity and
debt securities of companies outside of the health care industry, which, in the
opinion of LGT Asset Management, stand to benefit from developments in the
health care industry. The Health Care Fund also may invest up to 35% of its
total assets in debt securities, including debt securities convertible into
equity, when LGT Asset Management believes such debt securities present a
favorable opportunity for capital appreciation.

In analyzing companies for investment by the Health Care Fund, LGT Asset
Management ordinarily looks for several of the following characteristics:
above-average per share earnings

                               Prospectus Page 20
<PAGE>
                             GT GLOBAL THEME FUNDS
growth; high return on invested capital; a healthy balance sheet; sound
financial and accounting policies and overall financial strength; strong
competitive advantages; effective research and product development and
marketing; efficient service; pricing flexibility; strong management; and
general operating characteristics which will enable the companies to compete
successfully in their respective markets.

GLOBAL HEALTH CARE INDUSTRY INVESTMENT.  The health care industry includes
companies that are substantially engaged in the design, manufacture or sale of
products or services used for or in connection with health care or medicine.
Such firms may include pharmaceutical companies; firms that design, manufacture,
sell or supply medical, dental and optical products, hardware or services;
companies involved in biotechnology, medical diagnostic, and biochemical
research and development; and companies involved in the ownership and/or
operation of health care facilities.

The Health Care Fund expects that, from time to time, a significant portion of
its assets may be invested in the securities of U.S. issuers. Health care,
however, is a global industry with significant, growing markets outside of the
United States. A sizeable portion of the companies which comprise the health
care industry are headquartered outside of the United States, and many important
pharmaceutical and biotechnology discoveries and technological breakthroughs
have occurred outside of the United States, primarily in Japan, the United
Kingdom and Western Europe.

LGT Asset Management believes that various global health care industries offer
attractive long-term supply/demand dynamics. While the U.S., western Europe, and
Japan presently account for over 90% of health care expenditures, this should
change dramatically in the coming decade if the populations of developing
countries devote an increasing percentage of income to health care.
Additionally, LGT Asset Management believes demographics on aging point to a
significant increase in demand from the industrialized nations, as the elderly
account for a growing proportion of worldwide health care spending. Finally, in
LGT Asset Management's view, technology will continue to expand the range of
products and services offered, with new drugs, medical devices and surgical
procedures addressing medical conditions previously considered untreatable.

In addition to these underlying trends, the United States is presently
experiencing a period of rapid and profound change in its own health care
system, marked by the rise of managed care, the formation of health care
delivery networks, and widespread consolidation across all segments of the
industry. LGT Asset Management believes that this transition offers investment
opportunities in those companies acting as consolidators or otherwise gaining
market share at the expense of less efficient competitors.

TELECOMMUNICATIONS FUND
The Telecommunications Fund's investment objective is long-term growth of
capital. The Telecommunications Fund seeks its objective by investing primarily
in equity securities of companies throughout the world engaged in the
development, manufacture or sale of telecommunications services or equipment.
The Telecommunications Fund invests in telecommunications companies which, in
the opinion of LGT Asset Management, have potential for above average, long-term
growth in sales and earnings on a sustained basis. There is no assurance that
the Telecommunications Fund will achieve its objective.

At least 65% of the Telecommunications Fund's total assets normally will be
invested in common and preferred stocks and warrants to acquire such securities
issued by telecommunications companies. A "telecommunications" company is an
entity in which (i) at least 50% of either its revenues or earnings was derived
from telecommunications activities, or (ii) at least 50% of its assets was
devoted to telecommunications activities, based on the company's most recent
fiscal year. The remainder of the assets of the Telecommunications Fund may be
invested in debt securities issued by telecommunications companies, and/or
equity and debt securities of companies outside of the telecommunications
industry which, in the opinion of LGT Asset Management, stand to benefit from
developments in the telecommunications industry.

In analyzing companies for investment by the Telecommunications Fund, LGT Asset
Management ordinarily looks for several of the following characteristics:
above-average per share earnings growth; high return on invested capital; a
healthy balance sheet; sound financial and accounting policies and overall
financial strength; strong competitive advantages; effective research and
product development and marketing; development of new technologies; efficient
service; pricing flexibility; strong management; and general operating
characteristics that will enable the

                               Prospectus Page 21
<PAGE>
                             GT GLOBAL THEME FUNDS
companies to compete successfully in their respective markets.

GLOBAL TELECOMMUNICATIONS INDUSTRY INVESTMENT.  The telecommunications industry
is comprised of a variety of sectors, ranging from companies concentrating on
established technologies to those primarily engaged in emerging or developing
technologies. The characteristics of companies focusing on the same technology
will vary among countries depending upon the extent to which the technology is
established in the particular country. LGT Asset Management will allocate the
Telecommunications Fund's investments among these sectors depending upon its
assessment of their relative long-term growth potentials.

For purposes of the Telecommunications Fund's policy of investing at least 65%
of its total assets in the securities of telecommunications companies, the
companies in which the Telecommunications Fund will invest are those engaged
primarily in designing, developing or providing the following products and
services: communications equipment and services (including equipment and
services for both data and voice transmission); electronic components and
equipment; broadcasting (including television and radio, satellite, microwave
and cable television and narrow-casting); computer equipment, mobile
communications and cellular radio/paging; electronic mail; local and wide area
networking and linkage of word and data processing systems; publishing and
information systems; videotext and teletext; and emerging technologies combining
telephone, television and/or computer systems.

LGT Asset Management believes that there are opportunities for continued growth
in demand for components, products, media and systems to collect, store,
retrieve, transmit, process, distribute, record, reproduce and use information.
The pervasive societal impact of communications and information has been
accelerated by the lower costs and higher efficiencies that result from the
blending of computers with telecommunications systems. Accordingly, companies
engaged in the production of methods for using electronic and, potentially,
video technology to communicate information are expected to be important in the
Telecommunications Fund's portfolio. Older technologies, such as photography and
print also may be represented, however.

GLOBAL INVESTMENTS. Each Theme Portfolio expects that, from time to time, a
significant portion of its assets may be invested in the securities of domestic
issuers. Each industry represented in the Theme Portfolios, however, is a global
industry with significant, growing markets outside of the United States. A
sizeable proportion of the companies which comprise such industries are
headquartered outside of the United States.

For these reasons, LGT Asset Management believes that a portfolio comprised only
of securities of U.S. issuers does not provide the greatest potential for return
from a Theme Portfolio investment. LGT Asset Management uses its financial
expertise in markets located throughout the world and the substantial global
resources of the G.T. Group in attempting to identify those countries and
companies then providing the greatest potential for long-term capital
appreciation. In this fashion, LGT Asset Management seeks to enable shareholders
to capitalize on the substantial investment opportunities and the potential for
long-term growth of capital presented by the global industries represented in
the Theme Portfolios.

LGT Asset Management allocates each Theme Portfolio's assets among securities of
countries and in currency denominations where opportunities for meeting each
Theme Portfolio's investment objective are expected to be the most attractive.
Each Theme Portfolio may invest substantially in securities denominated in one
or more currencies. Under normal conditions, each Theme Portfolio except the
Health Care Fund invests in the securities of issuers located in at least three
countries, including the United States; investments in securities of issuers in
any one country, other than the United States, will represent no more than 40%
of the Financial Services Portfolio's and the Telecommunication Fund's total
assets, and no more than 50% of the Infrastructure Portfolio's, the Natural
Resources Portfolio's and the Consumer Products and Services Portfolio's total
assets. The Health Care Fund is not limited with regard to the percentage of
assets that may be invested in the securities of issuers located in a particular
country.

PRIVATIZATIONS. The governments of some foreign countries have been engaged in
programs of selling part or all of their stakes in government owned or
controlled enterprises ("privatizations"). LGT Asset Management believes that
privatizations may offer opportunities for significant capital appreciation and
intends to invest assets of the Theme Portfolios in privatizations in
appropriate circumstances. In certain foreign countries, the ability of foreign
entities such as the Theme Portfolios to participate in privatizations may be

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limited by local law, or the terms on which the Theme Portfolios may be
permitted to participate may be less advantageous than those for local
investors. There can be no assurance that foreign governments will continue to
sell companies currently owned or controlled by them or that privatization
programs will be successful.

OTHER POLICIES. The Financial Services Portfolio, Infrastructure Portfolio,
Natural Resources Portfolio, Consumer Products and Services Portfolio and
Telecommunications Fund each may invest up to 15% of its net assets, and the
Health Care Fund up to 10% of its total assets, in securities for which no
readily available market exists, so-called "Illiquid Securities." LGT Asset
Management believes that carefully selected investments in joint ventures,
cooperatives, partnerships and state enterprises which are illiquid
(collectively, "Special Situations") could enable the Portfolio to achieve
capital appreciation substantially exceeding the appreciation the Portfolio
would realize if it did not make such investments. However, in order to attempt
to limit investment risk, each of the Theme Portfolios will invest no more than
5% of its total assets in Special Situations.

The Financial Services Portfolio, Health Care Fund and Telecommunications Fund
each currently will not invest more than 5%, and the Infrastructure Portfolio,
the Natural Resources Portfolio and the Consumer Products and Services Portfolio
not more than 20%, of its total assets in debt securities rated below investment
grade, that is, rated below one of the four highest rating categories by
Standard & Poor's Ratings Group ("S&P") or Moody's Investors Service, Inc.
("Moody's") or deemed to be of equivalent quality in the judgment of LGT Asset
Management. See "Risk Factors -- Risks Associated with Debt Securities."
Securities rated in the lowest category of investment grade, that is, securities
rated BBB by S&P or Baa by Moody's, are considered by S&P and Moody's to have
speculative characteristics. Debt securities rated below investment grade are
the equivalent of high yield, high risk bonds, commonly known as "junk bonds."
Such securities may include (i) corporate debt securities and (ii) debt
instruments issued by governments whose debt is unrated and are subject to a
greater risk of loss of principal and interest than those of securities rated
above BBB by S&P or Baa by Moody's in the four highest rating categories
described above. The Theme Portfolios may also use instruments (including
forward contracts) often referred to as "derivatives." See "Options, Futures and
Forward Currency Transactions."

TEMPORARY DEFENSIVE STRATEGIES. Each Theme Portfolio retains the flexibility to
respond promptly to changes in market and economic conditions. Accordingly, in
the interest of preserving shareholders' capital and consistent with each Theme
Portfolio's investment objective, LGT Asset Management may employ a temporary
defensive investment strategy if it determines such a strategy to be warranted
due to market, economic or political conditions. Under a defensive strategy,
each Theme Portfolio may hold cash (U.S. dollars, foreign currencies or
multinational currency units) and/or invest any portion or all of its assets in
debt securities or high quality money market instruments issued by corporations,
or the U.S. or a foreign government. For temporary defensive purposes, such as
during times of international political or economic uncertainty, most or all of
each Theme Portfolio's investments may be made in the United States and
denominated in U.S. dollars. To the extent any Theme Portfolio adopts a
temporary defensive posture, it will not be invested so as to achieve directly
its investment objective.

In addition, pending investment of proceeds from new sales of the Funds' shares
or to meet its ordinary daily cash needs, each Theme Portfolio may hold cash
(U.S. dollars, foreign currencies or multinational currency units) and may
invest in foreign or domestic high quality money market instruments. Money
market instruments in which each Theme Portfolio may invest include, but are not
limited to, U.S. or foreign government securities; high-grade commercial paper;
bank certificates of deposit; bankers' acceptances; and repurchase agreements
related to any of the foregoing. High-grade commercial paper refers to
commercial paper rated A-1 by S&P or P-1 by Moody's or, if unrated, determined
by LGT Asset Management to be of comparable quality.

INVESTMENTS IN OTHER INVESTMENT COMPANIES. Each Theme Portfolio may invest up to
10% of its total assets in other investment companies. As a shareholder in an
investment company, that Theme Portfolio would bear its ratable share of that
investment company's expenses, including its advisory and administration fees.
At the same time, the Theme Portfolio would continue to pay its own management
fees and other expenses.

BORROWING. From time to time, it may be advantageous for a Theme Portfolio to
borrow money rather than sell existing portfolio positions to meet redemption
requests. Accordingly, a Theme Portfolio may borrow from banks or may borrow
through

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reverse repurchase agreements and "roll" transactions in connection with meeting
requests for the redemptions of a Theme Portfolio's shares.

A reverse repurchase agreement is a borrowing transaction in which a Theme
Portfolio transfers possession of a security to another party, such as a bank or
broker/dealer, in return for cash, and agrees to repurchase the security in the
future at an agreed upon price which includes an interest component. A "roll"
borrowing transaction involves a Theme Portfolio's sale of securities together
with its commitment (for which that Theme Portfolio may receive a fee) to
purchase similar, but not identical, securities at a future date.

Any Theme Portfolio's borrowings will not exceed 33 1/3% of that Theme
Portfolio's total assets, i.e., that Theme Portfolio's total assets at all times
will equal at least 300% of the amount of outstanding borrowings. If market
fluctuations in the value of the Theme Portfolio's securities holdings or other
factors cause the ratio of the Theme Portfolio's total assets to outstanding
borrowings to fall below 300%, within three days (excluding Sundays and
holidays) of such event the Theme Portfolio may be required to sell portfolio
securities to restore the 300% asset coverage, even though from an investment
standpoint such sales might be disadvantageous. A Theme Portfolio also may
borrow up to 5% of its total assets for temporary or emergency purposes other
than to meet redemptions. Any borrowing by a Theme Portfolio may cause greater
fluctuation in the value of its shares than would be the case if a Theme
Portfolio did not borrow. If a Theme Portfolio's borrowings exceed 5% of its
total assets, no additional investments will be made.

SECURITIES LENDING. Each Theme Portfolio is authorized to make loans of its
portfolio securities to broker/dealers or to other institutional investors. The
borrower must maintain with the Theme Portfolio's custodian collateral
consisting of cash, U.S. government securities or other liquid, high-grade debt
securities equal to at least the value of the borrowed securities, plus any
accrued interest. The Theme Portfolios will receive any interest paid on the
loaned securities and a fee and/or a portion of the interest earned on the
collateral. Each Theme Portfolio will limit its loans of portfolio securities to
an aggregate of 30% of the value of its total assets, measured at the time any
such loan is made. The risks in lending portfolio securities, as with other
extensions of secured credit, consist of possible delay in receiving additional
collateral or in recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially.
WHEN-ISSUED OR FORWARD COMMITMENT SECURITIES. The Theme Portfolios may purchase
debt securities on a "when-issued" basis and may purchase or sell such
securities on a "forward commitment" basis in order to hedge against anticipated
changes in interest rates and prices. The price, which is generally expressed in
yield terms, is fixed at the time the commitment is made, but delivery and
payment for the securities take place at a later date. When-issued securities
and forward commitments may be sold prior to the settlement date, but a Theme
Portfolio will enter into when-issued and forward commitments only with the
intention of actually receiving or delivering the securities, as the case may
be. No income accrues on securities which have been purchased pursuant to a
forward commitment or on a when-issued basis prior to delivery to the Theme
Portfolio. If the Theme Portfolio disposes of the right to acquire a when-issued
security prior to its acquisition or disposes of its right to deliver or receive
against a forward commitment, it may incur a gain or loss. At the time a Theme
Portfolio enters into a transaction on a when-issued or forward commitment
basis, a segregated account consisting of cash or high grade liquid debt
securities equal to the value of the when-issued or forward commitment
securities will be established and maintained with its custodian and will be
marked to market daily. There is a risk that the securities may not be delivered
and that the Theme Portfolio may incur a loss.

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                             GT GLOBAL THEME FUNDS

                                  RISK FACTORS

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

FINANCIAL SERVICES FUND AND FINANCIAL SERVICES PORTFOLIO
The Financial Services Portfolio concentrates its assets in the global financial
services industry, and thus should not be considered as a complete investment
program. Because the Financial Services Portfolio focuses on this specific
investment area, the price of Financial Services Fund shares may be more
volatile than that of investment companies that do not concentrate their
investments in such a manner. The value of Financial Services Fund shares may be
susceptible to factors affecting the financial services industry.

The financial services industry may be subject to greater governmental
regulation than many other industries and changes in governmental policies and
the need for regulatory approvals may have a material effect on the services of
this industry. Banks, savings institutions and loan associations, and finance
companies are subject to extensive governmental regulation which may limit both
the financial commitments they can make, including the amounts and types of
loans, and the interest rates and fees they can charge. These companies are
subject to rapid business changes, significant competition, value fluctuations
due to the concentration of loans in particular industries significantly
affected by economic conditions (such as real estate or energy) and volatile
performance dependent upon the availability and cost of capital and prevailing
interest rates. In addition, general economic conditions significantly affect
these companies. Credit and other losses resulting from the financial difficulty
of borrowers or other third parties potentially have an adverse effect on
companies in this industry. Moreover, neither federal insurance of deposits nor
governmental regulation ensures the solvency or profitability of commercial
banks or thrifts or their holding companies, or insures against any risk of
investment in the securities issued by such institutions.

Similar considerations affect the financial services sector in foreign
countries. In particular, government regulation in certain foreign countries may
include interest rate controls, credit controls and price controls. Moreover, in
some cases foreign governments have taken steps to nationalize the operations of
certain companies, such as banks, in the financial services sector.

The laws generally separating commercial and investment banking, as well as laws
governing the capitalization and regulation of the industry, currently are being
studied by U.S. governmental authorities. The services offered by banks may
expand if legislation broadening bank powers is enacted. While providing
diversification, expanded powers could expose banks to well-established
competitors, particularly as the historical distinctions between banks and other
financial institutions erode. Increased competition may result from the
broadening of regional and national interstate powers, which has led to a
decline in the number of publicly traded regional banks, and from the aggressive
expansion of larger, publicly held foreign banks. Foreign banks, particularly
those of Japan, recently have reported financial difficulties attributed to
increased competition, regulatory changes, and general economic difficulties.

In addition, recent legislation has altered significantly the regulatory
environment for savings institutions. This legislation was enacted in response
to financial problems experienced by a number of thrifts due to inadequate
capitalization resulting from diversification into commercial lending and other
areas and alleged fraud and mismanagement, as well as in response to
deterioration in the financial condition of the Federal Savings and Loan
Insurance Corporation, the federal agency that had insured deposits for most
thrifts. The Federal Deposit Insurance Corporation ("FDIC") now insures deposits
in both banks and thrifts. The legislation has given federal regulators
substantial authority to use all of the assets of a bank or thrift holding
company to satisfy federal claims against an insolvent thrift or bank owned by
the holding company. These changes have expanded the risk to holding company
shareholders in the event of the insolvency of any depository institution owned
by the holding company. Additionally, changes in the extent to which the FDIC
will insure deposits may result in a higher cost of funds for banks and thrifts
and the loss of deposits to competitors that are viewed as better capitalized.

                               Prospectus Page 25
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                             GT GLOBAL THEME FUNDS

The financial services area currently is changing relatively rapidly as existing
distinctions between various financial service segments become less clear. For
instance, recent business combinations have included insurance, finance, and
securities brokerage under single ownership. Some primarily retail corporations
have expanded into securities and insurance fields. In addition, investment
banking, securities brokerage and investment advisory companies in particular
are subject to government regulation and risk due to securities trading and
underwriting activities.

Many of the investment considerations discussed in connection with banks,
savings institutions and loan associations, and finance companies also apply to
insurance companies. The performance of insurance investments will be subject to
risk from several factors. The earnings of insurance companies will be affected
by interest rates, pricing (including severe pricing competition, from time to
time), claims activity, marketing competition and general economic conditions.
Particular insurance lines also will be influenced by specific matters. Property
and casualty insurer profits may be affected by certain weather catastrophes and
other disasters. Life and health insurer profits may be affected by mortality
and morbidity rates. Individual companies may be exposed to material risks,
including reserve inadequacy, problems in investment portfolios (due to real
estate or "junk" bond holdings, for example), and the inability to collect from
reinsurance carriers. Insurance companies are subject to extensive governmental
regulation, including the imposition of maximum rate levels, which may not be
adequate for some lines of business. Proposed or potential anti-trust or tax law
changes also may affect adversely insurance companies' policy sales, tax
obligations and profitability. In addition, significant insurance companies
recently have reported liquidity or solvency difficulties, or have experienced
credit rating downgrades.

INFRASTRUCTURE FUND AND INFRASTRUCTURE PORTFOLIO
The Infrastructure Portfolio primarily invests its assets in the global
infrastructure industries, and thus should not be considered as a complete
investment program. Because the Infrastructure Portfolio focuses on this
specific investment area, the price of Infrastructure Fund shares may be more
volatile than that of investment companies that do not concentrate their
investments in such a manner. The value of Infrastructure Fund shares may be
susceptible to factors affecting the infrastructure industries. In both the U.S.
and foreign countries, these industries may be subject to greater political,
environmental and other governmental regulation than many other industries.

The nature of such regulation continues to evolve in both the United States and
foreign countries, and changes in governmental policies and the need for
regulatory approvals may have a material effect on the products and services of
this industry. Electric, gas, water and most telecommunications companies in the
United States, for example, are subject to both federal and state regulation
affecting permitted rates of return and the kinds of services that may be
offered. Changes in prevailing interest rates may also affect the Infrastructure
Fund's share values because prices of equity and debt securities of
infrastructure companies often tend to increase when interest rates decline and
decrease when interest rates rise.

In addition, many infrastructure companies, including coal, steel, and other
types of companies, have historically been subject to the risks attendant to
increases in fuel and other operating costs, high interest costs on borrowed
funds, costs associated with compliance with environmental and other safety
regulations and changes in the regulatory climate. Such governmental regulation
may also hamper the development of new technologies, and it is impossible to
predict the direction, type or effect of any future regulation. Further
competition is intense for many infrastructure companies. As a result, many of
these companies may be adversely affected in the future and such companies may
be subject to increased share price volatility. In addition, many companies have
diversified into oil and gas exploration and development, therefore returns may
be more sensitive to energy prices. Other infrastructure companies, such as
water supply companies, are in a highly fragmented industry due to local
ownership. Generally these companies are mature and are experiencing little or
no growth.

NATURAL RESOURCES FUND AND NATURAL RESOURCES PORTFOLIO
The Natural Resources Portfolio primarily invests its assets in the global
natural resource industries, and thus should not be considered as a complete
investment program. Because the Natural Resources Portfolio focuses on this
specific investment area, the price of Natural Resources Fund shares may be more
volatile than that of investment companies that do not concentrate their
investments in such a manner. The value of Natural Resources Fund shares may be
susceptible to factors affecting the natural resource industries. In both

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                             GT GLOBAL THEME FUNDS
the U.S. and foreign countries, for example, these industries may be subject to
greater political, environmental and other governmental regulation than other
industries.

The nature of such regulation continues to evolve in both the U.S. and foreign
countries, and changes in governmental policies and the need for regulatory
approvals may have a material effect on the products and services of natural
resource companies. For example, the exploration, development and distribution
of coal, oil and gas in the United States are subject to significant federal and
state regulation, which may affect rates of return on such investments and the
kinds of services that may be offered.

In addition, many natural resource companies historically have been subject to
significant costs associated with compliance with environmental and other safety
regulations and changes in the regulatory climate. Such governmental regulations
may also hamper the development of new technologies, and it is impossible to
predict the direction, type or effect of any future regulation.

Further, competition is intense for many natural resource companies. As a
result, many of these companies may be adversely affected in the future and the
value of the securities issued by such companies may be subject to increased
share price volatility.

The value of the Natural Resources Portfolio's securities will fluctuate in
response to stock market developments, as well as market conditions for the
particular natural resources with which the issuer is involved. The price of the
commodity will fluctuate due to changes in worldwide levels of inventory, and
changes, perceived or actual, in production and consumption. The values of
natural resources may fluctuate directly with respect to various stages of the
inflationary cycle and perceived inflationary trends and are subject to numerous
factors, including national and international politics. The Natural Resources
Portfolio's investments in precious metals are subject to many risks, including
substantial price fluctuations over short periods of time. Further, the Natural
Resources Portfolio's investments in companies are expected to be subject to
irregular fluctuations in earnings, because these companies are affected by
changes in the availability of money, the level of interest rates, and other
factors.

CONSUMER PRODUCTS AND SERVICES FUND AND CONSUMER PRODUCTS AND SERVICES PORTFOLIO

The Consumer Products and Services Portfolio primarily invests its assets in the
global consumer products and services industries, and thus should not be
considered as a complete investment program. Because the Consumer Products and
Services Portfolio focuses on this specific investment area, the price of
Consumer Products and Services Fund shares may be more volatile than that of
investment companies that do not concentrate their investments in such a manner.
The value of Consumer Products and Services Fund shares will be susceptible to
factors affecting the consumer products and services industries.

General economic conditions significantly affect these companies. The
performance of consumer products manufacturers, marketers, retailers and
distributors relates closely to the performance of the overall economy, interest
rates and consumer confidence. Such performance also depends substantially on
disposable household income and consumer spending, both of which are closely
tied to the actual or perceived performance of the overall economy. In addition,
changes in demographics and consumer tastes may also affect the demand for, and
success of, consumer products and services in the global marketplace. Further,
competition is keen for many consumer products and services companies.

As a result, many consumer products and services companies may be adversely
affected and the value of the securities issued by such companies may be subject
to increased share price volatility. In addition, many consumer products and
services companies have unpredictable earnings, due in part to changes in
consumer tastes and intense competition. Also, the consumer products and
services industries have reacted strongly to technology development and to the
threat of government regulation. These industries may be subject to greater
government regulation, including trade regulation, than many other industries.
Changes in governmental policy and the need for regulatory approvals may have a
material effect on the products and services of the consumer products and
services industries. Such governmental regulations may also hamper the
development of new business opportunities, and it is impossible to predict the
direction, type or effect of any future government regulation.

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                             GT GLOBAL THEME FUNDS

HEALTH CARE FUND
The Health Care Fund primarily invests its assets in the global health care
industry and, as a result, should not be considered as a complete investment
program. Because the Health Care Fund focuses on this specific investment area,
the price of Health Care Fund shares may be more volatile than that of
investment companies that do not concentrate their investments in such a manner.
The value of Health Care Fund shares may be susceptible to factors affecting the
health care industry. The health care industry generally is subject to
substantial government regulation; accordingly, changes in government policies
or regulation could have a material effect on the demand for products and
services offered by health care companies and therefore could affect the
performance of the Health Care Fund. In addition, the products and services
offered by such companies may be subject to rapid obsolescence caused by
technological and scientific advances. Moreover, although the Health Care Fund's
portfolio will consist of securities of a substantial number of issuers, the
Health Care Fund's status as a "non-diversified" investment company pursuant to
the 1940 Act means that, with respect to 50% of the Health Care Fund's total
assets, more than 5% may be invested in the securities of a single issuer.
Because the Health Care Fund concentrates in health care companies and is
non-diversified, the value of the Health Care Fund's shares may fluctuate more
widely, and the Health Care Fund may present greater risk than funds investing
in a greater number of industries or issuers.

TELECOMMUNICATIONS FUND
The Telecommunications Fund primarily invests its assets in the global
telecommunications industry and, as a result, should not be considered as a
complete investment program. Because the Telecommunications Fund focuses on this
specific investment area, the price of Telecommunications Fund shares may be
more volatile than that of investment companies that do not concentrate their
investments in such a manner. The value of Telecommunications Fund shares may be
susceptible to factors affecting the telecommunications industry. This industry
may be subject to greater governmental regulation than many other industries and
changes in governmental policies and the need for regulatory approvals may have
a material effect on the products and services of this industry. Telephone
operating companies in the United States, for example, are subject to both
federal and state regulation affecting permitted rates of return and the kinds
of services that may be offered. Certain types of companies represented in the
Fund are engaged in fierce competition for a share of the market for their
products. In recent years, these have been companies providing goods and
services such as private and local area networks and telephone set equipment.
Moreover, the investment flexibility of the Telecommunications Fund may be
restricted by the necessity of satisfying certain diversification requirements
in order to maintain the qualification of the Telecommunications Fund as a
regulated investment company within the meaning of the Internal Revenue Code of
1986, as amended ("Code").

RISKS ASSOCIATED WITH DEBT SECURITIES. The value of the debt securities held by
each Theme Portfolio generally will vary conversely with market interest rates.
If interest rates in a market fall, the value of the debt securities held by
each Theme Portfolio ordinarily will rise. If market interest rates increase,
however, the debt securities owned by each Theme Portfolio in that market will
be likely to decrease in value.

As discussed above, the Infrastructure Portfolio, Natural Resources Portfolio
and Consumer Products and Services Portfolio may each invest up to 20% of its
total assets in debt securities rated below investment grade. Such investments
involve a high degree of risk. However, the Infrastructure Portfolio, Natural
Resources Portfolio and Consumer Products and Services Portfolio will not invest
in debt securities that are in default as to payment of principal and interest.

Debt rated BB, B, CCC, CC and C by S&P and debt rated Ba, B, Caa, Ca, C by
Moody's is 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 obligation. For S&P, BB indicates the lowest degree of speculation
and C the highest degree of speculation. For Moody's, Ba indicates the lowest
degree of speculation and C the highest degree of speculation. While such debt
will likely have some quality and protective characteristics, these are
outweighed by large uncertainties or major risk exposures to adverse conditions.
Similarly, debt rated Ba or BB and below is regarded by the relevant rating
agency as speculative. Debt rated C by Moody's or S&P is the lowest rated debt
that is not in default as to principal or interest, and such issues so rated can
be regarded as having extremely poor prospects of ever attaining any real
investment standing. Such securities are also generally considered to be subject
to greater risk than securities with higher ratings with regard to a

                               Prospectus Page 28
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                             GT GLOBAL THEME FUNDS
deterioration of general economic conditions. These debt securities are the
equivalent of high yield, high risk bonds, commonly known as "junk bonds."

Ratings of debt securities represent the rating agency's opinion regarding their
quality and are not a guarantee of quality. Rating agencies attempt to evaluate
the safety of principal and interest payments and do not evaluate the risks of
fluctuations in market value. Also, rating agencies may fail to make timely
changes in credit ratings in response to subsequent events, so that an issuer's
current financial condition may be better or worse than a rating indicates. See
"Description of Debt Ratings" in the Statement of Additional Information for a
full discussion of Moody's and S&P's ratings.

The market values of lower quality debt securities tend to reflect individual
developments of the issuer to a greater extent than do higher quality
securities, which react primarily to fluctuations in the general level of
interest rates. In addition, lower quality debt securities tend to be more
sensitive to economic conditions and generally have more volatile prices than
higher quality securities. Issuers of lower quality securities are often highly
leveraged and may not have available to them more traditional methods of
financing. For example, during an economic downturn or a sustained period of
rising interest rates, highly leveraged issuers of lower quality securities may
experience financial stress. During such periods, such issuers may not have
sufficient revenues to meet their interest payment obligations. The issuer's
ability to service its debt obligations may also be adversely affected by
specific developments affecting the issuer, such as the issuer's inability to
meet specific projected business forecasts or the unavailability of additional
financing. The risk of loss due to default by the issuer is significantly
greater for the holders of lower quality securities because such securities are
generally unsecured and are often subordinated to other creditors of the issuer.

Lower quality debt securities of corporate issuers frequently have call or
buy-back features which would permit an issuer to call or repurchase the
security from the Theme Portfolios. If an issuer exercises these provisions in a
declining interest rate market, the Theme Portfolios may have to replace the
security with a lower yielding security, resulting in a decreased return for
investors. In addition, the Theme Portfolios may have difficulty disposing of
lower quality securities because they may have a thin trading market. There may
be no established retail secondary market for many of these securities, and each
of the Theme Portfolios anticipates that such securities could be sold only to a
limited number of dealers or institutional investors. The lack of a liquid
secondary market also may have an adverse impact on market prices of such
instruments and may make it more difficult for the Theme Portfolios to obtain
accurate market quotations for purposes of valuing the Theme Portfolios
portfolio investments. The Theme Portfolios may also acquire lower quality debt
securities during an initial underwriting or which are sold without registration
under applicable securities laws. Such securities involve special considerations
and risks.

In addition to the foregoing, factors that could have an adverse effect on the
market value of lower quality debt securities in which the Theme Portfolios may
invest include: (i) potential adverse publicity; (ii) heightened sensitivity to
general economic or political conditions; and (iii) the likely adverse impact of
a major economic recession. The Theme Portfolios may also incur additional
expenses to the extent it is required to seek recovery upon a default in the
payment of principal or interest on its portfolio holdings, and the Theme
Portfolios may have limited legal recourse in the event of a default.

LGT Asset Management attempts to minimize the speculative risks associated with
investments in lower quality securities through credit analysis and by carefully
monitoring current trends in interest rates, political developments and other
factors. Nonetheless, investors should carefully review the investment objective
and policies of each of the Theme Portfolios and consider their ability to
assume the investment risks involved before making an investment.

OTHER RISK FACTORS. While each Theme Portfolio's portfolio normally will include
securities of established suppliers of traditional products and services, each
Theme Portfolio may invest in smaller companies which can benefit from the
development of new products and services. These smaller companies may present
greater opportunities for capital appreciation, but may also involve greater
risks than large, established issuers. Such smaller companies may have limited
product lines, markets or financial resources, and their securities may trade
less frequently and in more limited volume than the securities of larger, more
established companies. As a result, the prices of the

                               Prospectus Page 29
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securities of such smaller companies may fluctuate to a greater degree than the
prices of the securities of other issuers.

LGT Asset Management believes that a global portfolio of investments in the
industries represented by the Theme Portfolios may be less subject to market
risk (the risk attendant to investing in a particular market) and price
fluctuation than a portfolio invested solely in the securities of domestic
issuers. Under each of the Theme Portfolios' policies, LGT Asset Management may
shift the country allocations of the Theme Portfolios' investments as market
conditions in individual countries change. Moreover, the number of different
investment opportunities from which the Theme Portfolios may choose is
significantly broader than that of a fund investing solely in the securities of
U.S. companies.

Foreign investing entails certain risks. The securities of non-U.S. issuers
generally will not be registered with, nor the issuers thereof be subject to,
the reporting requirements of the SEC. Accordingly, there may be less publicly
available information about foreign securities and issuers than is available
about domestic securities and issuers. Foreign companies generally are not
subject to uniform accounting, auditing and financial reporting standards,
practices and requirements comparable to those applicable to domestic companies.
In addition, certain costs attributable to foreign investing, such as custody
charges, are higher than those attributable to domestic investing. Securities of
some foreign companies are less liquid and their prices may be more volatile
than securities of comparable domestic companies. The Theme Portfolios' interest
and dividends from foreign issuers may be subject to non-U.S. withholding taxes,
thereby reducing the Theme Portfolios' net investment income.

With respect to some foreign countries, there is the increased possibility of
expropriation or confiscatory taxation, limitations on the removal of funds or
other assets of the Theme Portfolios' political or social instability, or
diplomatic developments which could affect the Theme Portfolios' investments in
those countries. Moreover, individual foreign economies may differ favorably or
unfavorably from the U.S. economy in such respects as growth of gross national
product, rate of inflation, rate of savings and capital reinvestment, resource
self-sufficiency and balance of payments positions.

Since the Theme Portfolios may invest substantially in securities denominated in
currencies other than the U.S. dollar, and since the Theme Portfolios may hold
foreign currencies, the Theme Portfolios will be affected favorably or
unfavorably by exchange control regulations or changes in the exchange rates
between such currencies and the U.S. dollar. Changes in currency exchange rates
will influence the value of the Funds' shares, and also may affect the value of
dividends and interest earned by the Theme Portfolios and gains and losses
realized by the Theme Portfolios. Exchange rates are determined by the forces of
supply and demand in the foreign exchange markets. These forces are affected by
the international balance of payments and other economic and financial
conditions, government intervention, speculation and other factors.

OPTIONS, FUTURES AND FORWARD CURRENCY TRANSACTIONS. Each Theme Portfolio may use
forward currency contracts, futures contracts, options on securities, options on
indices, options on currencies and options on futures contracts to implement
strategies to attempt to hedge its portfolio, I.E., reduce the overall level of
investment risk normally associated with the portfolio. These instruments are
often referred to as "derivatives," which may be defined as financial
instruments whose performance is derived, at least in part, from the performance
of another asset (such as a security, currency or an index of securities). Each
Theme Portfolio may enter into such instruments up to the full value of its
portfolio assets. There can be no assurance that these hedging efforts will
succeed. These techniques are described below and are further detailed in the
Statement of Additional Information.

To attempt to hedge against adverse movements in exchange rates between
currencies, each Theme Portfolio may enter into forward currency contracts for
the purchase or sale of a specified currency at a specified future date. Such
contracts may involve the purchase or sale of a foreign currency against the
U.S. dollar or may involve two foreign currencies. The Theme Portfolios may
enter into forward currency contracts either with respect to specific
transactions or with respect to that Theme Portfolio's portfolio positions. For
example, when a Theme Portfolio anticipates making a purchase or sale of a
security, that Theme Portfolio may enter into a forward currency contract in
order to set the rate (either relative to the U.S. dollar or another currency)
at which a currency exchange transaction related to the purchase or sale will be
made. Further, when LGT Asset Management believes that a particular currency may
decline compared to the

                               Prospectus Page 30
<PAGE>
                             GT GLOBAL THEME FUNDS
U.S. dollar or another currency, a Theme Portfolio may enter into a forward
contract to sell the currency LGT Asset Management expects to decline in an
amount approximating the value of some or all of that Theme Portfolio's
portfolio securities denominated in a foreign currency. Each Theme Portfolio
also may purchase and sell put and call options on currencies, futures contracts
on currencies and options on futures contracts on currencies to hedge against
movements in exchange rates.

In addition, a Theme Portfolio may purchase and sell put and call options on
equity and debt securities to hedge against the risk of fluctuations in the
prices of securities held by that Theme Portfolio or that LGT Asset Management
intends to include in the Theme Portfolio's portfolio. The Theme Portfolio also
may purchase and sell put and call options on stock indexes. Such stock index
options serve to hedge against overall fluctuations in the securities markets
generally or in the natural resources market sector specifically, rather than
anticipated increases or decreases in the value of a particular security.

Further, a Theme Portfolio may sell stock index futures contracts and may
purchase put options or write call options on such futures contracts to protect
against a general stock market decline or a decline in the financial services
market sector that could affect adversely a Theme Portfolio's holdings. A Theme
Portfolio also may buy stock index futures contracts and purchase call options
or write put options on such contracts to hedge against a general stock market
or market sector advance and thereby attempt to lessen the cost of future
securities acquisitions. A Theme Portfolio may use interest rate futures
contracts and options thereon to hedge the debt portion of its portfolio against
changes in the general level of interest rates.

In addition, each Theme Portfolio may purchase and sell put and call options on
securities, currencies and indices that are traded on recognized securities
exchanges and over-the-counter markets.

These practices may result in the loss of principal under certain conditions. In
addition, certain provisions of the Code limit the extent to which a Theme
Portfolio may enter into forward contracts or futures contracts, or engage in
options transactions. See "Taxes" in the Statement of Additional Information.

Although a Theme Portfolio might not employ any of the foregoing strategies, its
use of forward currency contracts, options and futures would involve certain
investment risks and transaction costs to which it might not otherwise be
subject. These risks include: (1) dependence on LGT Asset Management's ability
to predict movements in the prices of individual securities, fluctuations in the
general securities markets or in the appropriate market sector and movements in
interest rates and currency markets; (2) imperfect correlation, or even no
correlation, between movements in the price of options, forward contracts,
futures contracts or options thereon and movements in the price of the currency
or security hedged or used for cover; (3) the fact that skills and techniques
needed to trade options, futures contracts and options thereon or to use forward
currency contracts are different from those needed to select the securities in
which a Theme Portfolio invests; (4) lack of assurance that a liquid secondary
market will exist for any particular option, futures contract or option thereon
at any particular time; (5) the possible inability of a Theme Portfolio to
purchase or sell a portfolio security at a time when it would otherwise be
favorable for it to do so, or the possible need for a Theme Portfolio to sell a
security at a disadvantageous time, due to the need for the Theme Portfolio to
maintain "cover" or to segregate securities in connection with hedging
transactions; and (6) the possible need to defer closing out of certain options,
futures contracts and options thereon and forward currency contracts in order to
qualify or continue to qualify for the beneficial tax treatment afforded
regulated investment companies under the Code. See "Dividends, Other
Distributions and Federal Income Taxation" herein and "Taxes" in the Statement
of Additional Information. If LGT Asset Management incorrectly forecasts
securities market movements, currency exchange rates or interest rates in
utilizing a strategy for a Theme Portfolio, the Theme Portfolio would be in a
better position if it had not hedged at all. A Theme Portfolio may also conduct
its foreign currency exchange transactions on a spot (I.E., cash) basis at the
spot rate prevailing in the foreign currency exchange market.

REPURCHASE AGREEMENTS. Repurchase agreements are transactions in which a Theme
Portfolio purchases a security from a bank or recognized securities dealer and
simultaneously commits to resell that security to the bank or dealer at an
agreed-upon price, date, and market rate of interest unrelated to the coupon
rate or maturity of the purchased security. Although repurchase agreements carry
certain risks not associated with direct investments in securities, including
possible

                               Prospectus Page 31
<PAGE>
                             GT GLOBAL THEME FUNDS
decline in the market value of the underlying securities and delays and costs to
the Theme Portfolio if the other party to the repurchase agreement becomes
bankrupt, the Theme Portfolios intend to enter into repurchase agreements only
with banks and dealers believed by LGT Asset Management to present minimal
credit risks in accordance with guidelines established by the Company's Board of
Directors, or a Portfolio's Board of Trustees, as applicable. LGT Asset
Management will review and monitor the creditworthiness of such institutions
under the Board's general supervision. See "Investment Objective and Policies --
Repurchase Agreements" in the Statement of Additional Information.

OTHER INFORMATION. The investment objective of each Fund may not be changed
without the approval of a majority of that Fund's outstanding voting securities.
As defined in the 1940 Act and as used in this Prospectus, a "majority of the
Fund's outstanding voting securities" means the lesser of (i) 67% of the Fund's
shares represented at a meeting at which more than 50% of the outstanding shares
are represented, or (ii) more than 50% of the outstanding shares. In addition,
each Fund has adopted certain investment limitations as fundamental policies
which also may not be changed without shareholder approval. Unless specifically
noted, the Portfolios' and the Funds' investment policies described in this
Prospectus, and in the Statement of Additional Information, including the
policies with respect to investment in its particular sector's securities and
the percentage limitations with respect to such investments, are not fundamental
policies and may be changed by vote of the Company's Board of Directors or the
Portfolio's Board of Trustees, as applicable, without shareholder approval. Each
Fund's policies regarding concentration and lending, and the percentage of that
Fund's assets that may be committed to borrowing, are fundamental policies and
may not be changed without shareholder approval. See "Investment Limitations" in
the Statement of Additional Information.

OTHER INFORMATION REGARDING THE PORTFOLIOS. The Financial Services Fund,
Infrastructure Fund, Natural Resources Fund and Consumer Products and Services
Fund may each withdraw its investment in its corresponding Portfolio at any
time, if the Board of Directors of the Company determines that it is in the best
interests of that Fund and its shareholders to do so. Upon such withdrawal, the
Board would consider what action might be taken, including the investment of all
the investable assets of that Fund in another pooled investment entity having
substantially the same investment objective as that Fund or the retention by
that Fund of its own investment adviser to manage that Fund's assets in
accordance with the investment objective, policies and limitations discussed
herein with respect to each such Fund and its investment in its corresponding
Portfolio.

The approval of the Financial Services Fund, Infrastructure Fund, Natural
Resources Fund and Consumer Products and Services Fund and of other investors in
their corresponding Portfolio, if any, is not required to change the investment
objective, policies or limitations of that Portfolio, unless otherwise
specified. Written notice shall be provided to shareholders of such Fund thirty
days prior to any changes in its corresponding Portfolio's investment objective.
If the objective of that Portfolio changes and the shareholders of the
corresponding Fund do not approve a parallel change in such Fund's investment
objective, that Fund would seek an alternative investment vehicle or directly
retain its own investment adviser.

As previously described, investors should be aware that the Financial Services
Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products and
Services Fund, unlike mutual funds which directly acquire and manage their own
portfolios of securities, seek to achieve their investment objective by
investing all of their investable assets in the Financial Services Portfolio,
Infrastructure Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio, respectively, each of which is a separate investment
company, as previously described. Since its corresponding Fund will invest only
in its corresponding Portfolio, that Fund's shareholders will acquire only an
indirect interest in the investments of that Portfolio. Historically, LGT Asset
Management and GT Global have sponsored traditionally structured funds, and,
therefore, have limited experience with funds that invest all their assets in a
separate portfolio.

In addition to selling its interest to its corresponding Fund, the Financial
Services Portfolio, Infrastructure Portfolio, Natural Resources Portfolio and
Consumer Products and Services Portfolio may each sell its interests to other
non-affiliated investment companies and/or other institutional investors. All
institutional investors in a Portfolio will pay a proportionate share of that
Portfolio's expenses and will invest in that Portfolio on the same terms and
conditions. However, if another investment company invests all of its assets in
a Portfolio, it

                               Prospectus Page 32
<PAGE>
                             GT GLOBAL THEME FUNDS
would not be required to sell its shares at the same public offering price as
the Portfolio's corresponding Fund and may charge different sales commissions.
Therefore, investors in the Financial Services Fund, Infrastructure Fund,
Natural Resources Fund and Consumer Products and Services Fund may experience
different returns from investors in another investment company which invests
exclusively in its corresponding Portfolio. As of the date of this Prospectus,
the Financial Services Fund, Infrastructure Fund, Natural Resources Fund and
Consumer Products and Services Fund are the only institutional investors in
their corresponding Portfolios. However, the Financial Services Portfolio,
Infrastructure Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio expect to offer beneficial interests to other institutional
investors in the future. Although interests in the Portfolios are not currently
available, either directly or indirectly, to individual investors through other
funds, information regarding any such funds will be available from GT Global at
the appropriate toll-free telephone number provided in the Shareholder Account
Manual.

Investors in the Financial Services Fund, Infrastructure Fund, Natural Resources
Fund and Consumer Products and Services Fund should be aware that such Funds'
investment in its corresponding Portfolio may be materially affected by the
actions of large investors in such Portfolio, if any. For example, as with all
open-end investment companies, if a large investor were to redeem its interest
in a Portfolio, that Portfolio's remaining investors could experience higher pro
rata operating expenses, thereby producing lower returns. As a result, that
Portfolio's security holdings may become less diverse, resulting in increased
risk. Institutional investors in a Portfolio that have a greater pro rata
ownership interest in that Portfolio than its corresponding Fund could have
effective voting control over the operation of that Portfolio. A change in a
Portfolio's fundamental objective, policies and restrictions, which is not
approved by the shareholders of its corresponding Fund could require such Fund
to redeem its interest in the Portfolio. Any such redemption could result in a
distribution in kind of portfolio securities (as opposed to a cash distribution)
by that Portfolio. Should such a distribution occur, the Financial Services
Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products and
Services Fund could incur brokerage fees or other transaction costs in
converting such securities to cash. In addition, a distribution in kind could
result in a less diversified portfolio of investments for the Financial Services
Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products and
Services Fund and could affect adversely the liquidity of such Funds.

See "Management" for a complete description of the investment management fee and
other expenses associated with the investment of the Financial Services Fund,
Infrastructure Fund, Natural Resources Fund and Consumer Products and Services
Fund in their corresponding Portfolios. This Prospectus, and the Statement of
Additional Information dated March 1, 1995, as revised January 5, 1996, contain
more detailed information about this organizational structure of the Financial
Services Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products
and Services Fund and their corresponding Portfolios, including information
related to: (i) the investment objective, policies and restrictions of such
Funds and their Portfolios; (ii) the Board of Directors and officers of the
Company, the Trustees and officers of the Portfolios, the administrator of such
Funds and the investment manager and administrator of the Portfolios; (iii)
portfolio transactions and brokerage commissions; (iv) such Funds' shares,
including the rights and liabilities of its shareholders; (v) additional
performance information, including the method used to calculate yield and total
return; and (vi) the determination of the value of the shares of such Funds.

                               Prospectus Page 33
<PAGE>
                             GT GLOBAL THEME FUNDS

                                 HOW TO INVEST

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

GENERAL. Each Fund is authorized to issue three classes of shares. Class A
shares of each Fund are sold to investors subject to an initial sales charge,
while Class B shares are sold without an initial sales charge but are subject to
higher ongoing expenses and a contingent deferred sales charge payable upon
certain redemptions. The third class of shares of the Funds, the Advisor Class,
may be offered through a separate prospectus only to certain investors.
Investors known to be eligible to purchase Advisor Class shares will be sold
only Advisor Class shares rather than any other class of shares offered by a
Fund. See "Alternative Purchase Plan."

Orders received before the close of regular trading on the New York Stock
Exchange ("NYSE") (currently 4:00 p.m. Eastern Time, unless weather, equipment
failure or other factors contribute to an earlier closing time) on any Business
Day will be executed at the public offering price for the applicable class of
shares determined that day. A "Business Day" is any day Monday through Friday on
which the NYSE is open for business. The minimum initial investment is $500
($100 for IRAs and $25 for custodial accounts under Section 403(b)(7) of the
Code and other tax-qualified employer-sponsored retirement accounts, if made
under a systematic investment plan providing for monthly payments of at least
that amount), and the minimum for additional purchases is $100 ($25 for IRAs,
Code Section 403 (b)(7) custodial accounts and other tax-qualified
employer-sponsored retirement accounts, as mentioned above). All purchase orders
will be executed at the public offering price next determined after the purchase
order is received, which includes any applicable sales charge for Class A
shares. See "How to Invest -- Public Offering Price." The Funds and GT Global
reserve the right to reject any purchase order and to suspend the offering of
shares for a period of time.

WHEN PLACING PURCHASE ORDERS, INVESTORS SHOULD SPECIFY WHETHER THE ORDER IS FOR
CLASS A OR CLASS B SHARES OF THE FUNDS. ALL SHARE PURCHASE ORDERS THAT FAIL TO
SPECIFY A CLASS WILL AUTOMATICALLY BE INVESTED IN CLASS A SHARES. PURCHASES OF
$500,000 OR MORE MUST BE FOR CLASS A SHARES.

PURCHASES THROUGH BROKER/DEALERS. Shares of the Funds may be purchased through
broker/dealers with which GT Global has entered into dealer agreements. Orders
received by such broker/dealers before the close of regular trading on the NYSE
on a Business Day will be effected that day, provided that such order is
transmitted to the Transfer Agent prior to its close of business on such day.
The broker/dealer will be responsible for forwarding the investor's order to the
Transfer Agent so that it will be received prior to such time. After an initial
investment is made and a shareholder account is established through a broker, at
the investor's option subsequent purchases may be made directly through GT
Global. See "Shareholder Account Manual."

Broker/dealers that do not have dealer agreements with GT Global also may offer
to place orders for the purchase of shares. Purchases made through such
broker/dealers will be effected at the public offering price next determined
after the order is received by the Transfer Agent. Such a broker/ dealer may
charge the investor a transaction fee as determined by the broker/dealer. That
fee will be in addition to the sales charge payable by the investor, with
respect to Class A shares, and may be avoided if shares are purchased through a
broker/ dealer that has a dealer agreement with GT Global or directly through GT
Global.

PURCHASES THROUGH THE DISTRIBUTOR. Investors may purchase shares and open an
account directly through GT Global, the Funds' distributor, by completing and
signing the Account Application located at the end of this Prospectus. Investors
should mail to the Transfer Agent the completed Application together with a
check to cover the purchase in accordance with the instructions provided in the
Shareholder Account Manual. Purchases will be executed at the public offering
price next determined after the Transfer Agent has received the Account
Application and check. Subsequent investments do not need to be accompanied by
such an application.

Investors also may purchase shares of the Funds through GT Global by bank wire.
Bank wire purchases will be effected at the next determined

                               Prospectus Page 34
<PAGE>
                             GT GLOBAL THEME FUNDS
public offering price after the bank wire is received. Accordingly, a bank wire
received by the close of regular trading on the NYSE on a Business Day will be
effected that day. A wire investment is considered received when the Transfer
Agent is notified that the bank wire has been credited to a Fund. The investor
is responsible for providing prior telephonic or facsimile notice to the
Transfer Agent that a bank wire is being sent. An investor's bank may charge a
service fee for wiring money to a Fund. The Transfer Agent currently does not
charge a service fee for facilitating wire purchases, but reserves the right to
do so in the future. Investors desiring to open an account by bank wire should
call the Transfer Agent at the appropriate toll-free number provided in the
Shareholder Account Manual to obtain an account number and detailed
instructions.

                           PURCHASING CLASS A SHARES

Each Fund's public offering price per Class A share is equal to the net asset
value per share (see "Calculation of Net Asset Value") plus a sales charge
determined in accordance with the following schedule:

<TABLE>
<CAPTION>
                   SALES CHARGE AS PERCENTAGE OF        DEALER
AMOUNT OF                                             REALLOWANCE
PURCHASE           ------------------------------    AS PERCENTAGE
AT THE PUBLIC        OFFERING           NET             OF THE
OFFERING PRICE         PRICE        INVESTMENT      OFFERING PRICE
- -----------------  -------------  ---------------  -----------------
<S>                <C>            <C>              <C>
Less than
  $50,000........          4.75%           4.99%            4.25%
$50,000 but less
  than
  $100,000.......          4.00%           4.17%            3.50%
$100,000 but less
  than
  $250,000.......          3.00%           3.09%            2.75%
$250,000 but
  less than
  $500,000.......          2.00%           2.04%            1.75%
$500,000 or
  more...........          0.00%           0.00%           *
</TABLE>

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

*   GT Global will pay the following commissions to brokers that initiate and
    are responsible for purchases of any single purchaser of Class A shares of
    $500,000 or more in the aggregate: 1.00% of the purchase amount up to $3
    million, plus 0.50% on the excess over $3 million. For purposes of
    determining the appropriate brokerage commission to be paid in connection
    with the transaction, GT Global will combine purchases made by a broker on
    behalf of a single client so that the broker's commission, as outlined
    above, will be based on the aggregate amount of such client's share
    purchases over a rolling twelve month period from the date of the
    transaction.

All shares purchased pursuant to a sales charge waiver based on the aggregate
purchase amount equalling at least $500,000 will be subject to a contingent
deferred sales charge for the first year after their purchase, as described
under "Contingent Deferred Sales Charge -- Class A Shares," equal to 1% of the
lower of the original purchase price or the net asset value of such shares at
the time of redemption.

From time to time, GT Global may reallow to broker/ dealers the full amount of
the sales charge or may pay out additional amounts to broker/dealers who sell
Class A shares. In some instances, GT Global may offer these reallowances or
additional payments only to broker/dealers that have sold or may sell
significant amounts of Class A shares. To the extent that GT Global reallows the
full amount of the sales charge to broker/dealers, such broker/dealers may be
deemed to be underwriters under the Securities Act of 1933. Commissions also may
be paid to broker/dealers and other financial institutions that initiate
purchases of at least $500,000 made pursuant to sales charge waivers (i) and
(vii), described below under "Sales Charge Waivers -- Class A Shares."

The following describes purchases that may be aggregated for purposes of
determining the "Amount of Purchase":

(a) Individual purchases on behalf of a single purchaser, the purchaser's spouse
and their children under the age of 21 years. This includes shares purchased in
connection with an employee benefit plan(s) exclusively for the benefit of such
individual(s), such as an IRA, individual Code Section 403(b) plan or
single-participant Keogh-type plan (that is, a self-employed individual
retirement plan ("Keogh Plan")). This also includes purchases made by a company
controlled by such individual(s);

(b) Individual purchases by a trustee or other fiduciary purchasing shares for a
single trust estate or a single fiduciary account, including an employee benefit
plan (such as employer-sponsored pension, profit-sharing and stock bonus plans,
including Section 401(k) plans, and medical, life and disability insurance
trusts) other than a plan described in "(a)" above;

or

(c) Individual purchases by a trustee or other fiduciary purchasing shares
concurrently for two or more employee benefit plans of a single employer or of
employers affiliated with each other (again excluding an employee benefit plan
described in "(a)" above).

                               Prospectus Page 35
<PAGE>
                             GT GLOBAL THEME FUNDS

SALES CHARGE WAIVERS -- CLASS A SHARES. Class A shares are sold at net asset
value without imposition of sales charges when investments are made by the
following classes of investors:

(i) Trustees or other fiduciaries purchasing shares for employee benefit plans
which are sponsored by organizations which have at least 100 but less than 1,000
employees.

(ii) Current or retired Trustees, Directors and officers of the investment
companies for which LGT Asset Management serves as investment manager and/or
administrator; employees or retired employees of the companies comprising
Liechtenstein Global Trust or affiliated companies of Liechtenstein Global
Trust; the children, siblings and parents of the persons in the foregoing
categories; and trusts primarily for the benefit of such persons.

(iii) Registered representatives or full-time employees of broker/dealers which
have entered into dealer agreements with GT Global, and the children, siblings
and parents of such persons, and employees of financial institutions that
directly, or through their affiliates, have entered into dealer agreements with
GT Global (or that otherwise have an arrangement with respect to sales of Fund
shares with a broker/dealer that has entered into a dealer agreement with GT
Global) and the children, siblings and parents of such employees.

(iv) Companies exchanging shares with or selling assets to one or more of the GT
Global Mutual Funds pursuant to a merger, acquisition or exchange offer.

(v) Shareholders of any of the GT Global Mutual Funds as of April 30, 1987 who
since that date continually have owned shares of one or more of the GT Global
Mutual Funds.

(vi) Purchases made through the automatic investment of dividends and other
distributions paid by any of the other GT Global Mutual Funds.

(vii)  Registered investment advisers, trust companies and bank trust
departments exercising DISCRETIONARY investment authority with respect to the
money to be invested in the GT Global Mutual Funds provided that the aggregate
amount invested pursuant to this sales charge waiver is at least $500,000, and
further provided that such money is not eligible to be invested in the Advisor
Class.

(viii)  Clients of administrators of tax-qualified employee benefit plans which
have entered into agreements with GT Global.
(ix)  Retirement plan participants who borrow from their retirement accounts by
redeeming GT Global Mutual Fund shares and subsequently repay such loans via a
purchase of a Fund's shares.

(x)  Retirement plan participants who receive distributions from a tax-qualified
employer-sponsored retirement plan, which is invested in GT Global Mutual Funds,
the proceeds of which are reinvested in Funds' shares.

(xi)  Accounts not eligible for the Advisor Class as to which a financial
institution or broker/dealer charges an account management fee, provided the
financial institution or broker/dealer has entered into an agreement with GT
Global regarding such accounts.

REINSTATEMENT PRIVILEGE. Shareholders who redeem their Class A shares in a Fund
have a one-time privilege of reinstating their investment by investing the
proceeds of the redemption at net asset value without a sales charge in Class A
shares of that Fund and/or one or more of the other GT Global Mutual Funds. The
Transfer Agent must receive from the investor or the investor's broker/dealer
within 180 days after the date of the redemption both a written request for
reinvestment and a check not exceeding the amount of the redemption proceeds.
The reinstatement purchase will be effected at the net asset value per share
next determined after such receipt. For a discussion of the federal income tax
consequences of a reinstatement, see "Dividends, Other Distributions and Federal
Income Taxation -- Taxes."

REDUCED SALES CHARGE PLANS -- CLASS A SHARES. Class A shares may be purchased at
reduced sales charges either through the Right of Accumulation or under a Letter
of Intent. For more details on these plans, investors should contact their
broker/ dealers or the Transfer Agent.

RIGHT OF ACCUMULATION. Pursuant to the Right of Accumulation, investors are
permitted to purchase shares of a Fund at the sales charge applicable to the
total of (a) the dollar amount then being purchased plus (b) the dollar amount
of the investor's concurrent purchases of other GT Global Mutual Funds (other
than GT Global Dollar Fund) plus (c) the price of all shares of GT Global Mutual
Funds (other than shares of GT Global Dollar Fund not acquired by exchange)
already held

                               Prospectus Page 36
<PAGE>
                             GT GLOBAL THEME FUNDS
by the investor. To receive the Right of Accumulation, at the time of purchase
investors must give their broker/dealer, the Transfer Agent or GT Global
sufficient information to permit confirmation of qualification. THE FOREGOING
RIGHT OF ACCUMULATION APPLIES ONLY TO CLASS A SHARES OF THE FUND AND CLASS A
SHARES OF THE OTHER GT GLOBAL MUTUAL FUNDS (OTHER THAN GT GLOBAL DOLLAR FUND).

LETTER OF INTENT. In executing a Letter of Intent ("LOI"), an investor indicates
an aggregate investment amount he or she intends to invest in the Class A shares
of a Fund and the Class A shares of other GT Global Mutual Funds (other than GT
Global Dollar Fund) in the following thirteen months. The LOI is included as
part of the Account Application located at the end of this Prospectus. The sales
charge applicable to that aggregate amount then becomes the applicable sales
charge on all purchases made concurrently with the execution of the LOI and in
the thirteen months following that execution. If an investor executes an LOI
within 90 days of a prior purchase of GT Global Mutual Fund Class A shares
(other than shares of GT Global Dollar Fund), the prior purchase may be included
under the LOI and an appropriate adjustment, if any, with respect to the sales
charges paid by the investor in connection with the prior purchase will be made,
based on the then-current net asset value(s) of the pertinent Fund(s).

If at the end of the thirteen month period covered by the LOI the total amount
of purchases does not equal the amount indicated, the investor will be required
to pay the difference between the sales charges paid at the reduced rate and the
sales charges applicable to the purchases actually made. Shares having a value
equal to 5% of the amount specified in the LOI will be held in escrow during the
thirteen month period (while remaining registered in the investor's name) and
are subject to redemption to assure any necessary payment to GT Global of a
higher applicable sales charge.

For purposes of an LOI, any registered investment adviser, trust company or bank
trust department which exercises investment discretion and which intends within
thirteen months to invest $500,000 or more can be treated as a single purchaser,
provided further that such entity places all purchase and redemption orders.
Such entities should be prepared to establish their qualifications for such
treatment. THE FOREGOING LETTER OF INTENT APPLIES ONLY TO CLASS A SHARES OF THE
FUNDS AND OTHER GT GLOBAL MUTUAL FUNDS (OTHER THAN GT GLOBAL DOLLAR FUND). THE
VALUE OF CLASS B SHARES OF ANY GT GLOBAL MUTUAL FUND WILL NOT BE COUNTED TOWARD
THE FULFILLMENT OF AN LOI.

CONTINGENT DEFERRED SALES CHARGE -- CLASS A SHARES. Purchases of Class A shares
of $500,000 or more may be made without an initial sales charge. Purchases of
Class A shares of two or more GT Global Mutual Funds (other than the GT Global
Dollar Fund) may be combined for this purpose, and the Right of Accumulation
also applies to such purchases. If a shareholder within one year after the date
of purchase redeems any Class A shares that were purchased without a sales
charge by reason of a purchase of $500,000 or more as described above under
"Purchasing Class A Shares," a contingent deferred sales charge of 1% of the
lower of the original purchase price or the net asset value of such shares at
the time of redemption will be charged. Class A shares that are redeemed will
not be subject to the contingent deferred sales charge to the extent that the
value of such shares represents (1) reinvestment of dividends or other
distributions or (2) Class A shares redeemed more than one year after their
purchase. Such shares purchased in amounts of at least $500,000 without a sales
charge may be exchanged for Class A shares of another GT Global Mutual Fund
(other than GT Global Dollar Fund) without the imposition of a contingent
deferred sales charge, although the contingent deferred sales charge described
above will apply to the redemption of the shares acquired through an exchange.
The waivers set forth under "Contingent Deferred Sales Charge Waivers" below are
applied to redemptions of Class A shares upon which a contingent deferred sales
charge is imposed. For federal income tax purposes, the amount of the contingent
deferred sales charge will reduce the gain or increase the loss, as the case may
be, on the amount realized on redemption. The amount of any contingent deferred
sales charge will be paid to GT Global.

                           PURCHASING CLASS B SHARES

The public offering price of the Class B shares of the Funds is the next
determined net asset value per share. No initial sales charge is imposed. A
contingent deferred sales charge, however, is imposed on certain redemptions of
Class B shares. Since the Class B shares are sold without an initial sales
charge, the Fund receives the full amount of the investor's purchase payment.

Class B shares of the Funds that are redeemed will not be subject to a
contingent deferred sales charge

                               Prospectus Page 37
<PAGE>
                             GT GLOBAL THEME FUNDS
to the extent that the value of such shares represents: (1) reinvestment of
dividends or capital gain distributions or (2) shares redeemed more than six
years after their purchase. Redemptions of most other Class B shares will be
subject to a contingent deferred sales charge. See "Contingent Deferred Sales
Charge Waivers." The amount of any applicable contingent deferred sales charge
will be calculated by multiplying the lesser of the original purchase price or
the net asset value of such shares at the time of redemption by the applicable
percentage shown in the table below. Accordingly, no charge is imposed on
increases in net asset value above the original purchase price:

<TABLE>
<CAPTION>
                             CONTINGENT DEFERRED SALES CHARGE
                             AS A PERCENTAGE OF THE LESSER OF
                             NET ASSET VALUE AT REDEMPTION OR
     REDEMPTION DURING          THE ORIGINAL PURCHASE PRICE
- ---------------------------  ---------------------------------
<S>                          <C>
1st Year Since Purchase....                      5%
2nd Year Since Purchase....                      4%
3rd Year Since Purchase....                      3%
4th Year Since Purchase....                      3%
5th Year Since Purchase....                      2%
6th year Since Purchase....                      1%
Thereafter.................                      0%
</TABLE>

In determining whether a contingent deferred sales charge is applicable to a
redemption, the calculation will be made in a manner that results in the lowest
possible rate. It will be assumed that the redemption is made first of amounts
representing shares acquired pursuant to the reinvestment of dividends and
distributions; then of amounts representing the cost of shares purchased seven
years or more prior to the redemption; and finally, of amounts representing the
cost of shares held for the longest period of time within the applicable
six-year period.

For example, assume an investor purchased 100 shares at $10 per share for a cost
of $1,000. Subsequently, the shareholder acquired 15 additional shares through
dividend reinvestment. During the second year after the purchase the investor
decided to redeem $500 of his or her investment. Assuming at the time of the
redemption a net asset value of $11 per share, the value of the investor's
shares would be $1,265 (115 shares at $ 11 per share). The contingent deferred
sales charge would not be applied to the value of the reinvested dividend
shares. Therefore, the 15 shares currently valued at $165.00 would be sold
without a contingent deferred sales charge. The number of shares needed to fund
the remaining $335 of the redemption would equal 30.455. Using the lower of cost
or market price to determine the contingent deferred sales charge, the original
purchase price of $10.00 per share would be used. The contingent deferred sales
charge calculation would therefore be 30.455 shares times $10.00 per share at
the contingent deferred sales charge rate of 4% (the applicable rate in the
second year after purchase) for a total contingent deferred sales charge of
$12.18.

For federal income tax purposes, the amount of the contingent deferred sales
charge will reduce the gain or increase the loss, as the case may be, on the
amount recognized on the redemption of shares. The amount of any contingent
deferred sales charge will be paid to GT Global.

                           CONTINGENT DEFERRED SALES
                                 CHARGE WAIVERS

The contingent deferred sales charge will be waived for exchanges, as described
below, and for redemptions in connection with a Fund's systematic withdrawal
plan not in excess of 12% of the value of the account annually. In addition, the
contingent deferred sales charge will be waived in the following circumstances:
(1) total or partial redemptions made within one year following the death or
disability of a shareholder; (2) minimum required distributions made in
connection with a GT Global IRA, Keogh Plan or custodial account under Section
403(b) of the Code or other retirement plan following attainment of age 70 1/2;
(3) total or partial redemptions resulting from a distribution following
retirement in the case of a tax-qualified employer-sponsored retirement plan;
(4) when a redemption results from a tax-free return of an excess contribution
pursuant to Section 408(d)(4) or (5) of the Code or from the death or disability
of the employee; (5) a one-time reinvestment in Class B shares of a Fund within
180 days of a prior redemption; (6) redemptions pursuant to a Fund's right to
liquidate a shareholder's account involuntarily; (7) redemptions pursuant to
distributions from a tax-qualified employer-sponsored retirement plan, which is
invested in GT Global Mutual Funds, which are permitted to be made without
penalty pursuant to the Code, other than tax-free rollovers or transfers of
assets, and the proceeds of which are reinvested in Fund shares; (8) redemptions
made in connection with participant-directed exchanges between options in an
employer-sponsored benefit plan; (9) redemptions made for the purpose of
providing cash to fund a loan to a participant in a tax-qualified retirement
plan; (10) redemptions made in connection with a distribution from any
retirement plan or account that is permitted in

                               Prospectus Page 38
<PAGE>
                             GT GLOBAL THEME FUNDS
accordance with the provisions of Section 72(t)(2) of the Code, and the
regulations promulgated thereunder; (11) redemptions made in connection with a
distribution from any retirement plan or account that involves the return of an
excess deferral amount pursuant to Section 401(k)(8) or Section 402(g)(2) of the
Code or the return of excess aggregate contributions pursuant to Section
401(m)(6) of the Code; (12) redemptions made in connection with a distribution
(from a qualified profit-sharing or stock bonus plan described in Section 401(k)
of the Code) to a participant or beneficiary under Section 401(k)(2)(B)(IV) of
the Code upon hardship of the covered employee (determined pursuant to Treasury
Regulation Section 1.401(k)-1(d)(2)); and (13) redemptions made by or for the
benefit of certain states, counties or cities, or any instrumentalities,
departments or authorities thereof where such entities are prohibited or limited
by applicable law from paying a sales charge or commission.

            PROGRAMS APPLICABLE TO CLASS A SHARES AND CLASS B SHARES

AUTOMATIC INVESTMENT PLAN. Investors may purchase either Class A or Class B
shares of a Fund through the GT Global Automatic Investment Plan. Under this
Plan, an amount specified by the shareholder of $100 or more ($25 or more for
IRAs, Code Section 403(b)(7) custodial accounts and other tax-qualified
employer-sponsored retirement accounts) on a monthly or quarterly basis will be
sent to the Transfer Agent from the investor's bank for investment in the Funds.
Participants in the Automatic Investment Plan should not elect to receive
dividends or other distributions from the Funds in cash. To participate in the
Automatic Investment Plan, investors should complete the appropriate portion of
the Supplemental Application provided at the end of this Prospectus. Investors
should contact their brokers or GT Global for more information.

DOLLAR COST AVERAGING PROGRAM. Dollar cost averaging is a systematic,
disciplined investment method through which a shareholder invests the same
dollar amount each month. Accordingly, the investor purchases more shares when a
Fund's net asset value is relatively low and fewer shares when a Fund's net
asset value is relatively high. This can result in a lower average
cost-per-share than if the shareholder followed a less systematic approach. The
GT Dollar Cost Averaging Program provides a convenient means for investors to
use this method to purchase either Class A or Class B shares of the GT Global
Mutual Funds. Dollar cost averaging does not assure a profit and does not
protect against loss in declining markets. Because such a program involves
continuous investment in securities regardless of fluctuating price levels of
such securities, investors should consider their financial ability to continue
purchases through periods of low price levels.

A participant in the GT Dollar Cost Averaging Program first designates the size
of his or her monthly investment in a Fund ("Monthly Investment") after
participation in the program begins. The Monthly Investment must be at least
$1,000. The investor then will make an initial investment of at least $10,000 in
the GT Global Dollar Fund. Thereafter, each month an amount equal to the
specified Monthly Investment automatically will be redeemed from the GT Global
Dollar Fund and invested in Fund shares. A sales charge will be applied to each
automatic monthly purchase of Class A Fund shares in an amount determined in
accordance with the Right of Accumulation privilege described above. For more
information about the GT Global Dollar Cost Averaging Program, investors should
consult their brokers or GT Global.

CERTIFICATES. In the interest of economy and convenience, physical certificates
representing the Funds' shares will not be issued unless an investor submits a
written request to the Transfer Agent, or unless the investor's broker requests
that the Transfer Agent provide certificates. Shares of the Funds are recorded
on a register by the Transfer Agent, and shareholders who do not elect to
receive certificates have the same rights of ownership as if certificates had
been issued to them. Redemptions and exchanges by shareholders who hold
certificates may take longer to effect than similar transactions involving
non-certificated shares because the physical delivery and processing of properly
executed certificates is required. ACCORDINGLY, THE FUNDS AND GT GLOBAL
RECOMMEND THAT SHAREHOLDERS DO NOT REQUEST ISSUANCE OF CERTIFICATES.

                               Prospectus Page 39
<PAGE>
                             GT GLOBAL THEME FUNDS

                             HOW TO MAKE EXCHANGES

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

Shares of any Fund may be exchanged for shares of any of the other GT Global
Mutual Funds (including the other Funds), based on their respective net asset
values without imposition of any sales charges, provided that the registration
remains identical. This exchange privilege is available only in those
jurisdictions where the sale of GT Global Mutual Fund shares to be acquired may
be legally made. CLASS A SHARES MAY BE EXCHANGED ONLY FOR CLASS A SHARES OF
OTHER GT GLOBAL MUTUAL FUNDS. CLASS B SHARES MAY BE EXCHANGED ONLY FOR CLASS B
SHARES OF OTHER GT GLOBAL MUTUAL FUNDS. The exchange of Class B shares will not
be subject to a contingent deferred sales charge. For purposes of computing the
contingent deferred sales charge, the length of time of ownership of Class B
shares will be measured from the date of original purchase and will not be
affected by the exchange. EXCHANGES ARE NOT TAX-FREE AND WILL RESULT IN A
SHAREHOLDER REALIZING A GAIN OR LOSS, AS THE CASE MAY BE, FOR TAX PURPOSES. See
"Dividends, Other Distributions and Federal Income Taxation." Other than the
Funds, the GT Global Mutual Funds currently include:

      -- GT GLOBAL WORLDWIDE GROWTH FUND
      -- GT GLOBAL INTERNATIONAL GROWTH FUND
      -- GT GLOBAL EMERGING MARKETS FUND
      -- GT GLOBAL NEW PACIFIC GROWTH FUND
      -- GT GLOBAL EUROPE GROWTH FUND
      -- GT GLOBAL LATIN AMERICA GROWTH FUND*
      -- GT GLOBAL AMERICA SMALL CAP
         GROWTH FUND
      -- GT GLOBAL AMERICA GROWTH FUND
      -- GT GLOBAL AMERICA VALUE FUND
      -- GT GLOBAL JAPAN GROWTH FUND
      -- GT GLOBAL GROWTH & INCOME FUND
      -- GT GLOBAL GOVERNMENT INCOME FUND
      -- GT GLOBAL STRATEGIC INCOME FUND
      -- GT GLOBAL HIGH INCOME FUND
      -- GT GLOBAL DOLLAR FUND
- --------------
*   Formerly G.T. Latin America Growth Fund.

Up to four exchanges each year may be made without charge. A $7.50 service
charge will be imposed on each subsequent exchange. If an investor does not
surrender all of his or her shares in an exchange, the remaining balance in the
investor's account after the exchange must be at least $500. Exchange requests
received in good order by the Transfer Agent before the close of regular trading
on the NYSE on any Business Day will be processed at the net asset value
calculated on that day.

An investor interested in making an exchange should write or call his or her
broker/dealer or the Transfer Agent to request the prospectus of the other GT
Global Mutual Fund(s) being considered. Certain broker/dealers may charge a fee
for handling exchanges.

EXCHANGES BY TELEPHONE. A shareholder may give exchange instructions to the
shareholder's broker/ dealer or the Transfer Agent by telephone at the
appropriate toll-free number provided in the Shareholder Account Manual.
Exchange orders will be accepted by telephone provided that the exchange
involves only uncertificated shares on deposit in the shareholder's account or
for which certificates have previously been deposited. Shareholders
automatically have telephone privileges to authorize redemptions. The Funds, GT
Global and the Transfer Agent shall not be liable for any loss or damage for
acting in good faith upon instructions received by telephone and reasonably
believed to be genuine. The Funds employ reasonable procedures to confirm that
instructions communicated by telephone are genuine, including requiring some
form of personal identification prior to acting upon instructions received by
telephone, providing written confirmation of such transactions, and/or tape
recording of telephone instructions. The Funds may be liable for any losses due
to unauthorized or fraudulent instructions if they do not follow reasonable
procedures.

EXCHANGES BY MAIL. Exchange orders should be sent by mail to the investor's
broker/dealer or to the Transfer Agent at the address set forth in the
Shareholder Account Manual.

OTHER INFORMATION ABOUT EXCHANGES. Purchases, redemptions and exchanges should
be made for investment purposes only. A pattern of frequent exchanges, purchases
and sales is not acceptable and can be limited by the Funds' or GT Global's
refusal to accept further purchase and exchange orders from the investor or
broker/dealer. The terms of the exchange offer described above may be modified
at any time, on 60 days' prior written notice to shareholders.

                               Prospectus Page 40
<PAGE>
                             GT GLOBAL THEME FUNDS

                              HOW TO REDEEM SHARES

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

As described below, Fund shares may be redeemed at their net asset value
(subject to any applicable contingent deferred sales charge for Class B shares
or, in limited circumstances, Class A shares) and redemption proceeds will be
sent within seven days of the execution of a redemption request. Shareholders
with broker/dealers who sell shares may redeem shares through such
broker/dealers; if the shares are held in the broker/dealer's "street name" the
redemption must be made through the broker/dealer. Other shareholders may redeem
shares through the Transfer Agent. If a redeeming shareholder owns both Class A
and Class B shares of the Funds, the Class A shares will be redeemed first
unless the shareholder specifically requests otherwise.

REDEMPTIONS THROUGH BROKER/DEALERS. Shareholders with accounts at broker/dealers
who sell shares of the Funds may submit redemption requests to such
broker/dealers. Broker/dealers may honor a redemption request either by
repurchasing shares from a redeeming shareholder at the Funds' shares' net asset
value next computed after the broker/dealer receives the request or by
forwarding such requests to the Transfer Agent (see "How to Redeem Shares --
Redemptions Through the Transfer Agent"). Redemption proceeds (less any
applicable contingent deferred sales charge for Class B shares) normally will be
paid by check or, if offered by the broker/dealer, credited to the shareholder's
brokerage account at the election of the shareholder. Broker/dealers may impose
a service charge for handling redemption transactions placed through them and
may have other requirements concerning redemptions. Accordingly, shareholders
should contact their broker/dealers for more details.

REDEMPTIONS THROUGH THE TRANSFER AGENT. Redemption requests may be transmitted
to the Transfer Agent by telephone or by mail, in accordance with the
instructions provided in the Shareholder Account Manual. All redemptions will be
effected at the net asset value next determined after the Transfer Agent has
received the request in good order and any required supporting documentation
(less any applicable contingent deferred sales charge for Class B shares).
Redemption requests received before the close of regular trading on the NYSE on
a Business Day will be effected at the net asset value calculated on that day.
Redemption requests will not require a signature guarantee if the redemption
proceeds are to be sent either: (i) to the redeeming shareholder at the
shareholder's address of record as maintained by the Transfer Agent, provided
the shareholder's address of record has not been changed within the preceding
thirty days; or (ii) directly to a pre-designated bank, savings and loan or
credit union account ("Pre-Designated Account"). ALL OTHER REDEMPTION REQUESTS
MUST BE ACCOMPANIED BY A SIGNATURE GUARANTEE OF THE REDEEMING SHAREHOLDER'S
SIGNATURE. A signature guarantee can be obtained from any bank, U.S. trust
company, a member firm of a U.S. stock exchange or a foreign branch of any of
the foregoing or other eligible guarantor institution. A notary public is not an
acceptable guarantor. A shareholder with questions concerning the Funds'
signature guarantee requirement should contact the Transfer Agent.

Shareholders may qualify to have redemption proceeds sent to a Pre-Designated
Account by completing the appropriate section of the Account Application at the
end of this Prospectus. Shareholders with Pre-Designated Accounts should request
that redemption proceeds be sent either by bank wire or by check. The minimum
redemption amount for a bank wire is $1,000. Shareholders requesting a bank wire
should allow two business days from the time the redemption request is effected
for the proceeds to be deposited in the shareholder's Pre-Designated Account.
See "How to Redeem Shares -- Other Important Redemption Information."
Shareholders may change their Pre-Designated Accounts only by a letter of
instruction to the Transfer Agent containing all account signatures, each of
which must be guaranteed. The Transfer Agent currently does not charge a bank
wire service fee for each wire redemption sent, but reserves the right to do so
in the future.

REDEMPTIONS BY TELEPHONE. Redemption requests may be made by telephone by
calling the Transfer Agent at the appropriate toll-free number provided in the
Shareholder Account Manual. Shareholders who hold certificates for shares may
not redeem by telephone. REDEMPTION REQUESTS MAY NOT BE MADE BY TELEPHONE FOR
THIRTY DAYS

                               Prospectus Page 41
<PAGE>
                             GT GLOBAL THEME FUNDS
FOLLOWING ANY CHANGE OF THE SHAREHOLDER'S ADDRESS OF RECORD.

Shareholders automatically have telephone privileges to authorize redemptions.
The Funds, GT Global and the Transfer Agent shall not be liable for any loss or
damage for acting in good faith upon instructions received by telephone and
reasonably believed to be genuine. The Funds employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, including
requiring some form of personal identification prior to acting upon instructions
received by telephone, providing written confirmation of such transactions,
and/or tape recording of telephone instructions. The Funds may be liable for any
losses due to unauthorized or fraudulent instructions if they do not follow
reasonable procedures.

REDEMPTIONS BY MAIL. Redemption requests should be mailed directly to the
Transfer Agent at the appropriate address provided in the Shareholder Account
Manual. As discussed above, requests for payment of redemption proceeds to a
party other than the registered account owner(s) and/or requests that redemption
proceeds be mailed to an address other than the shareholder's address of record
require a signature guarantee. In addition, if the shareholder's address of
record has been changed within the preceding thirty days, a signature guarantee
is required. Redemptions of shares for which certificates have been issued must
be accompanied by properly endorsed share certificates.

SYSTEMATIC WITHDRAWAL PLAN. Shareholders owning shares with a value of $10,000
or more may participate in the GT Global Systematic Withdrawal Plan. A
participating shareholder will receive proceeds from monthly, quarterly or
annual redemptions of Fund shares with respect to either Class A or Class B
shares. No contingent deferred sales charge will be imposed on redemptions made
under the Systematic Withdrawal Plan. The minimum withdrawal amount is $100. The
amount or percentage a participating shareholder specifies to be redeemed may
not, on an annualized basis, exceed 12% of the value of the account, as of the
time the shareholder elects to participate in the Systematic Withdrawal Plan. To
participate in the Systematic Withdrawal Plan, investors should complete the
appropriate portion of the Supplemental Application provided at the end of this
Prospectus. Investors should contact their brokers or the Transfer Agent for
more information. With respect to Class A shares, participation in the
Systematic Withdrawal Plan concurrent with purchases of Class A shares may be
disadvantageous to investors because of the sales charges involved and possible
tax implications, and therefore is discouraged. In addition, shareholders who
participate in the Systematic Withdrawal Plan should not elect to reinvest
dividends or other distributions in additional Fund shares.

OTHER IMPORTANT REDEMPTION INFORMATION. A request for redemption will not be
processed until all of the necessary documentation has been received in good
order. A shareholder in doubt as to what documents are required should contact
his or her broker/dealer or the Transfer Agent.

Except in extraordinary circumstances and as permitted under the 1940 Act,
payment for shares redeemed by telephone or by mail will be made promptly after
receipt of a redemption request, if in good order, but not later than seven days
after the date the request is executed. Requests for redemption which are
subject to any special conditions or which specify a future or past effective
date cannot be accepted.

If the Transfer Agent is requested to redeem shares for which the Funds have not
yet received good payment, the Funds may delay payment of redemption proceeds
until they have assured themselves that good payment has been collected for the
purchase of the shares. In the case of purchases by check it can take up to 10
business days to confirm that the check has cleared and good payment has been
received. Redemption proceeds will not be delayed when shares have been paid for
by wire or when the investor's account holds a sufficient number of shares for
which funds already have been collected.

The Funds may redeem the shares of any shareholder whose account is reduced to
less than $500 in value through redemptions or other action by the shareholder.
Written notice will be given to the shareholder at least 60 days prior to the
date fixed for such redemption, during which time the shareholder may increase
his or her holdings to an aggregate amount of $500 or more (with a minimum
purchase of $100 or more).

                               Prospectus Page 42
<PAGE>
                             GT GLOBAL THEME FUNDS

                           SHAREHOLDER ACCOUNT MANUAL

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

Shareholders are encouraged to place purchase, exchange and redemption orders
through their broker/dealers. Shareholders also may place such orders directly
through the Transfer Agent in accordance with this Manual. See "How to Invest;"
"How to Make Exchanges;" "Dividends, Other Distributions and Federal Income
Taxation -- Taxes" and "How to Redeem Shares" for more information.

Each Fund's Transfer Agent is GT GLOBAL INVESTOR SERVICES, INC.

INVESTMENTS BY MAIL

Send the completed Account Application (if initial purchase) or letter stating
Fund name, class of shares, shareholder's registered name and account number (if
subsequent purchase) with a check to:

    GT Global
    P.O. Box 7345
    San Francisco, California 94120-7345

INVESTMENTS BY BANK WIRE

An investor opening a new account should call 1-800-223-2138 to obtain an
account number. WITHIN SEVEN DAYS OF PURCHASE SUCH AN INVESTOR MUST SEND A
COMPLETED ACCOUNT APPLICATION CONTAINING THE INVESTOR'S CERTIFIED TAXPAYER
IDENTIFICATION NUMBER TO GT GLOBAL AT THE ADDRESS PROVIDED ABOVE UNDER
"INVESTMENTS BY MAIL." Wire instructions must state Fund name, class of shares,
shareholder's registered name and account number. Bank wires should be sent
through the Federal Reserve Bank Wire System to:

    WELLS FARGO BANK N.A.
    ABA 121000248
    Attn: GT GLOBAL
    ACCOUNT NO. 4023-050701
(Stating Fund name, class of shares, shareholder's registered name and account
number)

EXCHANGES BY TELEPHONE

Call GT Global at 1-800-223-2138

EXCHANGES BY MAIL

Send complete instructions, including name of Fund exchanging from, class of
shares, amount of exchange, name of the GT Global Mutual Fund exchanging into,
shareholder's registered name and account number, to:

    GT Global
    P.O. Box 7893
    San Francisco, CA 94120-7893

REDEMPTIONS BY TELEPHONE

Call GT Global at 1-800-223-2138

REDEMPTIONS BY MAIL

Send complete instructions, including name of Fund, class of shares, amount of
redemption, shareholder's registered name and account number, to:

    GT Global
    P.O. Box 7893
    San Francisco, CA 94120-7893

OVERNIGHT MAIL

Overnight mail services do not deliver to post office boxes. To send purchase,
exchange or redemption orders by overnight mail, follow the above instructions
but send the instructions to the following address:

    GT Global Investor Services
    California Plaza
    2121 N. California Boulevard
    Suite 450
    Walnut Creek, CA 94596

ADDITIONAL QUESTIONS

Shareholders with additional questions regarding purchase, exchange and
redemption procedures should call GT Global at 1-800-223-2138.

                               Prospectus Page 43
<PAGE>
                             GT GLOBAL THEME FUNDS

                         CALCULATION OF NET ASSET VALUE

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

Each Fund calculates its net asset value as of the close of regular trading on
the floor of the NYSE (currently 4:00 p.m. Eastern Time, unless weather,
equipment failure or other factors contribute to an earlier closing time), each
Business Day. Each Fund's net asset value per share is computed by determining
the value of its total assets (which, in the case of the Financial Services
Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products and
Services Fund is the value of such Funds' investment in its corresponding
Portfolio), subtracting all of each Fund's liabilities, and dividing the result
by the total number of shares outstanding at such time. Net asset value is
determined separately for each class of shares of each Fund.

Equity securities held by the Theme Portfolios are valued at the last sale price
on the exchange or in the principal over-the-counter market in which such
securities are traded, as of the close of business on the day the securities are
being valued, or, lacking any sales, at the last available bid price. Long-term
debt obligations are valued at the mean of representative quoted bid and asked
prices for such securities or, if such prices are not available, at prices for
securities of comparable maturity, quality and type; however, when LGT Asset
Management deems it appropriate, prices obtained from a bond pricing service
will be used. Short-term debt investments are amortized to maturity based on
their cost, adjusted for foreign exchange translation and market fluctuations,
provided such valuations represent fair value. When market quotations for
futures and options positions held by a Fund are readily available, those
positions will be valued based upon such quotations.

Securities and other assets for which market quotations are not readily
available are valued at fair value determined in good faith by or under the
direction of the Company's Board of Directors or the Portfolios' Board of
Trustees, as applicable. Securities quoted in foreign currencies will be valued
in U.S. dollars based on the prevailing exchange rates on that day.

Certain of the Theme Portfolios' securities from time to time may be listed
primarily on foreign exchanges which trade on days when the NYSE is closed (such
as a Saturday). As a result, the net asset value of a Fund's shares may be
significantly affected by such trading on days when shareholders have no access
to that Fund.

The different expenses borne by each class of shares will result in different
net asset values and dividends. The per share net asset value of the Class B
shares of a Fund generally will be lower than that of the Class A shares of that
Fund because of the higher expenses borne by the Class B shares. It is expected,
however, that the net asset value per share of the two classes will tend to
converge immediately after the payment of dividends, which will differ by
approximately the amount of the service and distribution expense accrual
differential between the classes. The per share net asset value and dividends of
the Advisor Class shares of a Fund generally will be higher than that of the
Class A and Class B shares of that Fund because of the absence of 12b-1 service
and distribution fees with respect to Advisor Class shares.

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

                         DIVIDENDS, OTHER DISTRIBUTIONS
                          AND FEDERAL INCOME TAXATION

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

DIVIDENDS AND OTHER DISTRIBUTIONS. Each Fund annually declares as a dividend all
of its net investment income, if any, which includes dividends, accrued interest
and earned discount (including both original issue and market discounts) less
applicable expenses. Each Fund also normally distributes for each fiscal year
substantially all of its realized net short-term capital gain (the excess of
short-term capital gains over short-term capital

                               Prospectus Page 44
<PAGE>
                             GT GLOBAL THEME FUNDS
losses), net capital gain (the excess of net long-term capital gain over net
short-term capital loss) and net gains from foreign currency transactions, if
any. Each Fund may make an additional dividend or other distribution if
necessary to avoid a 4% excise tax on certain undistributed income and gain.

Dividends and other distributions paid by each Fund with respect to all classes
of its shares are calculated in the same manner and at the same time. The per
share income dividends on Class B shares of a Fund will be lower than the per
share income dividends on Class A shares of that Fund as a result of the higher
service and distribution fees applicable to Class B shares; the per share income
dividends on both such classes of shares of a Fund will be lower than the per
share income dividends on the Advisor Class shares of that Fund as a result of
the absence of any service and distribution fees applicable to Advisor Class
shares. SHAREHOLDERS MAY ELECT:

/ / to have all dividends and other distributions automatically reinvested in
    additional Fund shares of the distributing class (or in shares of the
    corresponding class of other GT Global Mutual Funds); or

/ / to receive dividends in cash and have other distributions automatically
    reinvested in additional Fund shares of the distributing class (or in shares
    of the corresponding class of other GT Global Mutual Funds); or

/ / to receive other distributions in cash and have dividends automatically
    reinvested in additional Fund shares of the distributing class (or in shares
    of the corresponding class of other GT Global Mutual Funds); or

/ / to receive dividends and other distributions in cash.

Automatic reinvestments in additional shares are made at net asset value without
imposition of a sales charge. IF NO ELECTION IS MADE BY A SHAREHOLDER, ALL
DIVIDENDS AND OTHER DISTRIBUTIONS WILL BE AUTOMATICALLY REINVESTED IN ADDITIONAL
FUND SHARES OF THE DISTRIBUTING CLASS. Reinvestments in another GT Global Mutual
Fund may only be directed to an account with the identical shareholder
registration and account number. These elections may be changed by a shareholder
at any time; to be effective with respect to a distribution, the shareholder or
the shareholder's broker must contact the Transfer Agent by mail or telephone at
least 15 Business Days prior to the payment date. THE FEDERAL INCOME TAX STATUS
OF DIVIDENDS AND OTHER DISTRIBUTIONS IS THE SAME WHETHER THEY ARE RECEIVED IN
CASH OR REINVESTED IN ADDITIONAL SHARES.

Any dividend or other distribution paid by a Fund has the effect of reducing the
net asset value per share on the ex-dividend date by the amount thereof.
Therefore, a dividend or other distribution paid shortly after a purchase of
shares would represent, in substance, a return of capital to the shareholder (to
the extent it is paid on the shares so purchased), even though subject to income
tax, as discussed below.

TAXES. Each Fund intends to qualify or continue to qualify for treatment as a
regulated investment company under the Code. In each taxable year that a Fund so
qualifies, that Fund (but not its shareholders) will be relieved of federal
income tax on that part of its investment company taxable income (consisting
generally of net investment income, net gains from certain foreign currency
transactions and net short-term capital gain) and net capital gain that is
distributed to its shareholders. Each Portfolio expects that it also will not be
liable for any federal income tax.

Dividends from a Fund's investment company taxable income (whether paid in cash
or reinvested in additional shares) are taxable to its shareholders as ordinary
income to the extent of the Fund's earnings and profits. Distributions of a
Fund's net capital gain, when designated as such, are taxable to its
shareholders as long-term capital gains, regardless of how long they have held
their Fund shares and whether paid in cash or reinvested in additional shares.

Each Fund provides federal tax information to its shareholders annually,
including information about dividends and other distributions paid during the
preceding year and, under certain circumstances, the shareholders' respective
shares of any foreign taxes treated as paid by the Fund, in which event each
shareholder would be required to include in his or her gross income his or her
pro rata share of those taxes but might be entitled to claim a credit or
deduction for them.

Each Fund must withhold 31% from dividends, capital gain distributions and
redemption proceeds payable to any individuals and certain other noncorporate
shareholders who have not furnished to the Fund a correct taxpayer
identification number or a properly completed claim for exemption on Form W-8 or
W-9. Withholding at that rate also is required from dividends and capital gain
distributions payable to such shareholders who otherwise are subject to backup
withholding. Fund accounts opened via a bank wire purchase (see "How to Invest
- -- Purchases Through the Distributor") are considered to have uncertified
taxpayer identification numbers unless a completed

                               Prospectus Page 45
<PAGE>
                             GT GLOBAL THEME FUNDS
Form W-8 or W-9 or Account Application is received by the Transfer Agent within
seven days after the purchase. A shareholder should contact the Transfer Agent
if the shareholder is uncertain whether a proper taxpayer identification number
is on file with a Fund.

A redemption of Fund shares may result in taxable gain or loss to the redeeming
shareholder, depending upon whether the redemption proceeds are more or less
than the shareholder's adjusted basis for the redeemed shares (which normally
includes any initial sales charge paid on Class A shares). An exchange of Fund
shares for shares of another GT Global Mutual Fund generally will have similar
tax consequences. However, special tax rules apply when a shareholder (1)
disposes of Class A shares of a Fund through a redemption or exchange within 90
days after purchase and (2) subsequently acquires Class A shares of such Fund or
any other GT Global Mutual Fund on which an initial sales charge normally is
imposed without paying a sales charge due to the reinstatement privilege or
exchange privilege. In these cases, any gain on the disposition of the original
Class A shares will be increased, or loss decreased, by the amount of the sales
charge paid when those shares were acquired, and that amount will increase the
adjusted basis of the shares subsequently acquired. In addition, if Fund shares
are purchased within 30 days before or after redeeming other shares of the same
Fund (regardless of class) at a loss, all or a part of the loss will not be
deductible and instead will increase the basis of the newly purchased shares.

The foregoing is only a summary of some of the important federal tax
considerations generally affecting the Funds and their shareholders. See "Taxes"
in the Statement of Additional Information for a further discussion. There may
be other federal, state, local or foreign tax considerations applicable to a
particular investor. Prospective investors therefore are urged to consult their
tax advisers.

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

                                   MANAGEMENT

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

The Company's Board of Directors has overall responsibility for the operation of
each Fund. Pursuant to such responsibility, the Board has approved contracts
with various financial organizations to provide certain services required by
each Fund. The Portfolios' Board of Trustees has overall responsibility for
operation of each Portfolio. See "Directors, Trustees, and Executive Officers"
in the Statement of Additional Information for a complete description of the
Directors of the Funds and the Trustees of the Portfolios. A majority of the
disinterested members (as defined in the 1940 Act) of the Board of Directors of
the Company and the Board of Trustees of the Portfolios have adopted written
procedures reasonably appropriate to deal with potential conflicts of interest
arising concerning the Funds and their corresponding Portfolios up to and
including creating a separate Board of Trustees of the Portfolios.

INVESTMENT MANAGEMENT AND ADMINISTRATION. Services provided by LGT Asset
Management as the Theme Portfolios' investment manager and administrator
include, but are not limited to, determining the composition of the investment
portfolio of the Portfolios and placing orders to buy, sell or hold particular
securities. In addition, LGT Asset Management provides the following
administration services to the Portfolios and the Funds: furnishing corporate
officers and clerical staff; providing office space, services and equipment; and
supervising all matters relating to the Portfolios' and the Funds' operation.

The Financial Services Fund, Infrastructure Fund, Natural Resources Fund and
Consumer Products and Services Fund each pays administration fees directly to
LGT Asset Management at the annualized rate of 0.25% of such Fund's average
daily net assets. In addition, each such Fund bears its pro rata portion of the
investment management and administration fees paid by its corresponding
Portfolio to LGT Asset Management. The Financial Services Portfolio,
Infrastructure Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio each pays such fees, based on the average daily net assets of
such Portfolio, directly to LGT Asset Management at the annualized rate of .725%
on the first $500 million, .70% on the next $500 million, .675% on the next $500
million and .65% on all amounts thereafter. For investment management and
administration services provided to the Health Care Fund and Telecommunications

                               Prospectus Page 46
<PAGE>
                             GT GLOBAL THEME FUNDS
Fund, each such Fund pays LGT Asset Management a fee computed daily and paid
monthly based on each such Fund's average daily net assets at the annualized
rate of .975% on the first $500 million, .95% on the next $500 million, .925% on
the next $500 million and .90% on amounts thereafter. These rates are higher
than those paid by most mutual funds. LGT Asset Management also serves as each
Fund's pricing and accounting agent. The monthly fee for these services to LGT
Asset Management is a percentage, not to exceed 0.03% annually, of the Fund's
average daily net assets. The annual fee rate is derived by applying 0.03% to
the first $5 billion of assets of GT Global Mutual Funds and 0.02% to the assets
in excess of $5 billion and dividing the result by the aggregate assets of GT
Global Mutual Funds.

LGT Asset Management provides investment management and/or administration
services to the GT Global Mutual Funds. LGT Asset Management and its worldwide
asset management affiliates have provided investment management and/or
adninistration services to institutional, corporate and individual clients
around the world since 1969. The U.S. offices of LGT Asset Management are
located at 50 California Street, 27th Floor, San Francisco, California 94111.

LGT Asset Management and its worldwide affiliates, including LGT Bank in
Liechtenstein, formerly Bank in Liechtenstein, comprise Liechtenstein Global
Trust, formerly BIL GT Group Limited. On January 1, 1996, G.T. Capital
Management, Inc. was renamed LGT Asset Management, Bank in Liechtenstein was
renamed LGT Bank in Liechtenstein, and BIL GT Group Limited was renamed
Liechtenstein Global Trust. Liechtenstein Global Trust is a provider of global
asset management and private banking products and services to individual and
institutional investors. Liechtenstein Global Trust is controlled by the Prince
of Liechtenstein Foundation, which serves as the parent organization for the
various business enterprises of the Princely Family of Liechtenstein. The
principal business address of the Prince of Liechtenstein Foundation is
Herrengasse 12, FL-9490, Vaduz, Liechtenstein.

As of November 30, 1995, LGT Asset Management and its worldwide asset management
affiliates managed or administered approximately $22 billion, of which
approximately $20 billion consist of GT Global retail funds worldwide. In the
U.S., as of November 30, 1995, LGT Asset Management managed or administered
approximately $9.6 billion in GT Global Mutual Funds. As of November 30, 1995,
assets under advice by the LGT Bank in Liechtenstein exceeded approximately $23
billion. As of November 30, 1995, assets entrusted to Liechtenstein Global Trust
totaled approximately $45 billion.

In addition to the resources of its San Francisco office, LGT Asset Management
uses the expertise, personnel, data and systems of other offices of
Liechtenstein Global Trust, including investment offices in London, Hong Kong,
Tokyo, Singapore, Sydney and Frankfurt. In managing GT Global Mutual Funds, LGT
Asset Management employs a team approach, taking advantage of the resources of
these various investment offices around the world in seeking to achieve each
Fund's investment objective. Many of the investment managers who manage GT
Global Mutual Funds' portfolios are natives of the countries in which they
invest, speak local languages and/or live or work in the markets they follow.

The investment professionals primarily responsible for the portfolio management
of the Theme Portfolios are as follows:

                      GLOBAL FINANCIAL SERVICES PORTFOLIO

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                         THE PORTFOLIO                          PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------
<S>                                     <C>                                     <C>
A. James Ellman                         Portfolio Manager since 1995            Analyst for LGT Asset Management from
 San Francisco                                                                   1994 to 1995. From 1992 to 1994, Mr.
                                                                                 Ellman was a student at the Harvard
                                                                                 Graduate School of Business
                                                                                 Administration (where he received a
                                                                                 Masters of Business Administration).
                                                                                 From 1990 to 1992, Mr. Ellman was
                                                                                 employed by the Federal Reserve Bank
                                                                                 of New York as an international bank
                                                                                 examiner.
</TABLE>

                               Prospectus Page 47
<PAGE>
                             GT GLOBAL THEME FUNDS

                        GLOBAL INFRASTRUCTURE PORTFOLIO

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                         THE PORTFOLIO                          PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------
<S>                                     <C>                                     <C>
David L. Sherry                         Portfolio Manager since Portfolio       Portfolio Manager for LGT Asset
 San Francisco                           inception in 1994                       Management since 1993. From 1992 to
                                                                                 1993, Mr. Sherry was Senior
                                                                                 Securities Analyst for Franklin
                                                                                 Resources, Inc. (San Mateo, CA). From
                                                                                 1990 to 1992, he was a student at
                                                                                 University of California at Los
                                                                                 Angeles Graduate School of Business
                                                                                 (where he received a Masters of
                                                                                 Business Administration). Prior
                                                                                 thereto, he was an Assistant
                                                                                 Treasurer with Brown Brothers
                                                                                 Harriman (NY).

Michael Mahoney                         Portfolio Manager since Portfolio       Portfolio Manager for LGT Asset
 San Francisco                           inception in 1994                       Management since 1993. From 1991 to
                                                                                 1993, Mr. Mahoney was an Investment
                                                                                 Analyst for LGT Asset Management.
                                                                                 From 1989 to 1991, he was a student
                                                                                 at Stanford Graduate School of
                                                                                 Business (where he received a Masters
                                                                                 of Business Administration). Prior
                                                                                 thereto, he was a Management
                                                                                 Consultant for Bain & Co., management
                                                                                 consulting (Boston).
</TABLE>

                       GLOBAL NATURAL RESOURCES PORTFOLIO

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                         THE PORTFOLIO                          PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------

<S>                                     <C>                                     <C>
Charles A. Wall                         Portfolio Manager since Portfolio       Portfolio Manager for LGT Asset
 Sydney                                  inception in 1994                       Management Ltd. (Australia) and LGT
                                                                                 Asset Management since 1992. Prior
                                                                                 thereto, Mr. Wall was a Portfolio
                                                                                 Manager for Baring Securities
                                                                                 (Sydney).

Derek H. Webb                           Portfolio Manager since Portfolio       Analyst for LGT Asset Management from
 San Francisco                           inception in 1994                       1992 to 1994. From 1990 to 1992, Mr.
                                                                                 Webb was a student at the University
                                                                                 of Pennsylvania, Wharton School of
                                                                                 Business. During 1989, he was Vice
                                                                                 President, Citicorp Investment Bank
                                                                                 of Los Angeles. Prior thereto, he was
                                                                                 a Bond Trader, Trust Co. of the West
                                                                                 (Los Angeles).
</TABLE>

                               Prospectus Page 48
<PAGE>
                             GT GLOBAL THEME FUNDS

                GLOBAL CONSUMER PRODUCTS AND SERVICES PORTFOLIO

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                         THE PORTFOLIO                          PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------

<S>                                     <C>                                     <C>
Derek H. Webb                           Portfolio Manager since Portfolio       Analyst for LGT Asset Management from
 San Francisco                           inception in 1994                       1992 to 1994. From 1990 to 1992, Mr.
                                                                                 Webb was a student at the University
                                                                                 of Pennsylvania, Wharton School of
                                                                                 Business. During 1989, he was Vice
                                                                                 President, Citicorp Investment Bank
                                                                                 for Los Angeles. Prior thereto, he
                                                                                 was a Bond Trader, Trust Co. of the
                                                                                 West (Los Angeles).
</TABLE>

                            GLOBAL HEALTH CARE FUND

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                            THE FUND                            PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------

<S>                                     <C>                                     <C>
Edward R. Gomoll                        Portfolio Manager since Fund inception  Portfolio Manager for LGT Asset
 San Francisco                           in 1989                                 Management.

Michael Yellen                          Research Analyst since 1994             Research Analyst for LGT Asset
 San Francisco                                                                   Management since 1994. From 1991 to
                                                                                 1994, Mr. Yellen was a securities
                                                                                 analyst and co-portfolio manager for
                                                                                 Franklin Resources, Inc. (San Mateo,
                                                                                 CA). Prior thereto, Mr. Yellen was a
                                                                                 student at Stanford University, where
                                                                                 he received a Bachelor's Degree in
                                                                                 International Relations.
</TABLE>

                               Prospectus Page 49
<PAGE>
                             GT GLOBAL THEME FUNDS

                         GLOBAL TELECOMMUNICATIONS FUND

<TABLE>
<CAPTION>
                                                 RESPONSIBILITIES FOR                    BUSINESS EXPERIENCE
NAME/OFFICE                                            THE FUND                            PAST FIVE YEARS
- --------------------------------------  --------------------------------------  --------------------------------------

<S>                                     <C>                                     <C>
Michael Mahoney                         Portfolio Manager since 1993            From 1991 to 1993, Mr. Mahoney was an
 San Francisco                                                                   Investment Analyst for LGT Asset
                                                                                 Management. From 1989 to 1991, he was
                                                                                 a student at Stanford Graduate School
                                                                                 of Business (where he received a
                                                                                 Masters of Business Administration).
                                                                                 Prior thereto, he was a Management
                                                                                 Consultant for Bain & Co., management
                                                                                 consulting (Boston).

David L. Sherry                         Portfolio Manager since 1993            Portfolio Manager for LGT Asset
 San Francisco                                                                   Management since 1993. From 1992 to
                                                                                 1993, Mr. Sherry was Senior
                                                                                 Securities Analyst for Franklin
                                                                                 Resources, Inc. (San Mateo, CA). From
                                                                                 1990 to 1992, he was a student at
                                                                                 University of California at Los
                                                                                 Angeles Graduate School of Business
                                                                                 (where he received a Masters of
                                                                                 Business Administration). Prior
                                                                                 thereto, he was an Assistant
                                                                                 Treasurer with Brown Brothers
                                                                                 Harriman (NY).
</TABLE>

                               Prospectus Page 50
<PAGE>
                             GT GLOBAL THEME FUNDS

In addition, in managing the Theme Portfolios these individuals utilize the
research and related work of other members of LGT Asset Management's investment
staff.

In placing orders for the Theme Portfolios' securities transactions, LGT Asset
Management seeks to obtain the best net results. LGT Asset Management has no
agreement or commitment to place orders with any broker/dealer. Commissions or
discounts in foreign securities exchanges and over-the-counter ("OTC") markets
often are fixed and generally are higher than those in U.S. securities exchanges
or markets. Debt securities generally are traded on a "net" basis with a dealer
acting as principal for its own account without a stated commission, although
the price of the security usually includes a profit to the dealer. U.S. and
foreign government securities and money market instruments generally are traded
in the OTC markets. In underwritten offerings, securities usually are purchased
at a fixed price which includes an amount of compensation to the underwriter. On
occasion, securities may be purchased directly from an issuer, in which case no
commissions or discounts are paid. Broker/dealers may receive commissions on
futures, currency and options transactions. Consistent with its obligation to
obtain best net results, LGT Asset Management may consider a broker/dealer's
sale of shares of the GT Global Mutual Funds as a factor in considering through
whom portfolio transactions will be effected. Brokerage transactions for the
Theme Portfolios may be executed through any Liechtenstein Global Trust
affiliates.

LGT Asset Management anticipates that the annual turnover rate of each Theme
Portfolio will not exceed 100%. However, LGT Asset Management does not regard
portfolio turnover as a limiting factor and will buy or sell securities for each
Theme Portfolio as necessary in response to market conditions to meet each Theme
Portfolio's objective of long-term growth of capital. The portfolio turnover
rate is calculated by dividing the lesser of sales or purchases of portfolio
securities by each Theme Portfolio's average month-end portfolio value,
excluding short-term investments. For purposes of this calculation, portfolio
securities exclude purchases and sales of debt securities having a maturity at
the date of purchase of one year or less. High portfolio turnover involves
correspondingly greater transaction costs in the form of brokerage commissions
or dealer spreads and other costs that the Theme Portfolios will bear directly,
and may result in the realization of net capital gains, which are taxable when
distributed to each Fund's shareholders.

DISTRIBUTION OF FUND SHARES. GT Global is the distributor, or principal
underwriter, of the Funds' Class A and Class B shares. Like LGT Asset
Management, GT Global is a subsidiary of Liechtenstein Global Trust with offices
at 50 California Street, 27th Floor, San Francisco, CA 94111. As distributor, GT
Global collects the sales charges imposed on purchases of Class A shares and any
contingent deferred sales charges that may be imposed on certain redemptions of
Class A and Class B shares. GT Global reallows a portion of the sales charge on
Class A shares to broker/dealers that have sold such shares in accordance with
the schedule set forth above under "How to Invest." In addition, GT Global pays
a brokerage commission equal to 4.00% of the amount invested to broker/ dealers
who sell Class B shares. A brokerage commission with respect to Class B shares
is not paid on exchanges or certain reinvestments in Class B shares.

GT Global, at its own expense, may provide additional promotional incentives to
broker/dealers that sell shares of a Fund and/or shares of the other GT Global
Mutual Funds. In some instances additional compensation or promotional
incentives may be offered to broker/dealers that have sold or may sell
significant amounts of shares during specified periods of time. Such
compensation and incentives may include, but are not limited to, cash,
merchandise, trips and financial assistance to brokers in connection with
preapproved conferences or seminars, sales or training programs for invited
sales personnel, payment for travel expenses (including meals and lodging)
incurred by sales personnel and members of their families or other invited
guests to various locations for such seminars or training programs, seminars for
the public, advertising and sales campaigns regarding one or more of the GT
Global Mutual Funds, and/or other events sponsored by the broker/dealer. In
addition, GT Global makes ongoing payments to brokerage firms, financial
institutions (including banks) and others that facilitate the administration and
servicing of shareholder accounts.

Under a plan of distribution adopted by the Company's Board of Directors
pursuant to Rule 12b-1 under the 1940 Act, with respect to each Fund's Class A
shares ("Class A Plan"), each Fund may pay GT Global a service fee at the
annualized rate of up to 0.25% of the average daily net assets of such Fund's
Class A shares for its expenditures

                               Prospectus Page 51
<PAGE>
                             GT GLOBAL THEME FUNDS
incurred in servicing and maintaining shareholder accounts, and may pay GT
Global a distribution fee at the annualized rate of up to 0.50% of the average
daily net assets of each such Fund's Class A shares, less any amounts paid by
that Fund as the aforementioned service fee for its expenditures incurred in
providing services as distributor. All expenses for which GT Global is
reimbursed under the Class A Plan will have been incurred within one year of
such reimbursement.

Pursuant to a separate plan of distribution adopted with respect to each Fund's
Class B shares ("Class B Plan"), each Fund may pay GT Global a service fee at
the annualized rate of up to 0.25% of the average daily net assets of such
Fund's Class B shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay GT Global a distribution fee at the annualized
rate of up to 0.75% of the average daily net assets of such Fund's Class B
shares for its expenditures incurred in providing services as distributor.
Expenses incurred under the Class B Plan in excess of 1.00% annually may be
carried forward for reimbursement in subsequent years as long as such Plan
continues in effect.

GT Global's service and distribution expenses include the payment of ongoing
commissions; the cost of any additional compensation paid by GT Global to
broker/dealers; the costs of printing and mailing to prospective investors
prospectuses and other materials relating to the Funds; the costs of developing,
printing, distributing and publishing advertisements and other sales literature;
and allocated costs relating to GT Global's distribution activities, including,
among other things, employee salaries, bonuses and other overhead expenses. In
addition, its expenses under the Class B Plan include payment of initial sales
commissions to broker/dealers and interest on any unreimbursed amounts carried
forward thereunder.

The Glass-Steagall Act and other applicable laws, among other things, generally
prohibit federally chartered or supervised banks from engaging in the business
of underwriting or distributing securities. Accordingly, GT Global intends to
engage banks (if at all) only to perform administrative and shareholder
servicing functions. If a bank were prohibited from so acting, its shareholder
clients would be permitted to remain shareholders, and alternative means for
continuing the servicing of such shareholders would be sought. It is not
expected that shareholders would suffer any adverse financial consequences as a
result of any of these occurrences.

                               Prospectus Page 52
<PAGE>
                             GT GLOBAL THEME FUNDS

                               OTHER INFORMATION

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

CONFIRMATIONS AND REPORTS TO SHAREHOLDERS. Each time a transaction is made that
affects a shareholder's account in a Fund, such as an additional investment,
redemption or the payment of a dividend or distribution, the shareholder will
receive from the Transfer Agent a confirmation statement reflecting the
transaction. Confirmations for transactions effected pursuant to a Fund's
Automatic Investment Plan, Systematic Withdrawal Plan and automatic dividend
reinvestment program may be provided quarterly. Shortly after the end of each
Fund's fiscal year on October 31 and fiscal half-year on April 30 of each year,
shareholders receive an annual and semiannual report, respectively. These
reports list the securities held by each Fund and contain each Fund's financial
statements. In addition, the federal income status of distributions made by a
Fund to shareholders will be reported after the end of the fiscal year on Form
1099-DIV. Under certain circumstances, duplicate mailings of such reports may be
consolidated.

ORGANIZATION. The Company was organized as a Maryland corporation on October 29,
1987 and is registered with the SEC as an open-end management investment
company. From time to time, the Company may establish other funds, each
corresponding to a distinct investment portfolio and a distinct series of the
Company's common stock. Shares of each Fund are entitled to one vote per share
(with proportional voting for fractional shares) and are freely transferable.
Shareholders have no preemptive or conversion rights.

On any matter submitted to a vote of shareholders, shares of a Fund will be
voted by a Fund's shareholders individually when the matter affects the specific
interest of that Fund only, such as approval of its investment management
arrangements. In addition, each class of shares of a Fund has exclusive voting
rights with respect to its distribution plan. The shares of each Fund and of all
the Company's funds will be voted in the aggregate on other matters, such as the
election of Directors and ratification of the selection by the Board of
Directors of the Company's independent accountants.

Normally there will be no annual meeting of shareholders in any year, except as
required under the 1940 Act. Each Fund would be required to hold a shareholders'
meeting in the event that at any time less than a majority of the Directors
holding office had been elected by shareholders. Directors shall continue to
hold office until their successors are elected and have qualified. Shares of
each Fund and of the Company's other funds do not have cumulative voting rights,
which means that the holders of a majority of the shares voting for the election
of Directors can elect all the Directors. A Director may be removed upon a
majority vote of the shareholders qualified to vote in the election.
Shareholders holding 10% of the Company's outstanding voting shares may call a
meeting of shareholders for the purpose of voting upon the question of removal
of any Director or for any other purpose. The 1940 Act requires the Company to
assist shareholders in calling such a meeting.

Pursuant to the Company's Articles of Incorporation, it may issue six billion
shares. Of this number, three hundred million shares have been classified as
shares of each Fund, 100 million shares as Class A shares and 100 million shares
as Class B shares, except for the Telecommunications Fund, of which 200 million
shares have each been classified as Class A shares and Class B shares,
respectively. One hundred million shares have been classified as Advisor Class
shares for each Fund. These amounts may be increased from time to time in the
discretion of the Board of Directors. Each share of each Fund represents an
interest in that Fund only, has a par value of $0.0001 per share, represents an
equal proportionate interest in that Fund with other shares of that Fund and is
entitled to such dividends and other distributions out of the income earned and
gain realized on the assets belonging to that Fund as may be declared at the
discretion of the Board of Directors. Each Class A, Class B and Advisor Class
share of each Fund is equal as to earnings, assets and voting privileges, except
as noted above, and each class bears the expenses, if any, related to the
distribution of its shares. Shares of each Fund when issued are fully paid and
nonassessable.

ORGANIZATION OF THE PORTFOLIOS. Each Portfolio is organized as a subtrust of a
New York common law trust. The Declaration of Trust provides that the

                               Prospectus Page 53
<PAGE>
                             GT GLOBAL THEME FUNDS
Financial Services Fund, Infrastructure Fund, Natural Resources Fund and
Consumer Products and Services Fund and other entities investing in its
corresponding Portfolio (E.G., other investment companies, insurance company
separate accounts and common and commingled trust funds), if any, each will be
liable for all obligations of that Portfolio. However, the Directors of the
Company believe that the risk of such Funds' incurring financial loss because of
such liability is limited to circumstances in which both inadequate insurance
existed and each of the Portfolios itself was unable to meet its obligations,
and that neither the Financial Services Fund, Infrastructure Fund, Natural
Resources Fund and Consumer Products and Services Fund nor their shareholders
will be exposed to a material risk of liability by reason of the Funds'
investing in their corresponding Portfolios.

Whenever the Financial Services Fund, Infrastructure Fund, Natural Resources
Fund and Consumer Products and Services Fund is requested to vote on any
proposal of its corresponding Portfolio, such Fund will hold a meeting of such
Fund's shareholders and will cast its vote as instructed by its shareholders. As
is true for many investment companies, a majority of the outstanding voting
securities can control the results of certain shareholder votes. Because a
Portfolio investors' votes are proportionate to their percentage interests in
that Portfolio, one or more other Portfolio investors could, in certain
instances, approve an action against which a majority of the outstanding voting
securities of its corresponding Fund had voted. This could result in that Fund's
redeeming its investment in its corresponding Portfolio, which could result in
increased expenses for that Fund. Whenever the shareholders of the Financial
Services Fund, Infrastructure Fund, Natural Resources Fund and Consumer Products
and Services Fund are called to vote on matters related to its corresponding
Portfolio, the Directors of the Company shall vote shares for which they receive
no voting instructions in the same proportion as the shares for which they do
receive voting instructions. Any information received from the Financial
Services Portfolio, Infrastructure Portfolio, Natural Resources Portfolio and
Consumer Products and Services Portfolio in the Portfolio's report to
shareholders will be provided to the shareholders of its corresponding Fund.

Each investor in a Portfolio, including its corresponding Fund, may add to or
reduce its investment in that Portfolio on each day the NYSE is open for
trading. As of the close of regular trading on the NYSE on each such day, the
value of each such investor's beneficial interest in that Portfolio will be
determined by multiplying the net asset value of that Portfolio by the
percentage, effective for that day, which represents that investor's share of
the aggregate beneficial interests in that Portfolio. Any additions or
reductions, which are to be effected as of the close of the regular trading on
the NYSE, on such day, will then be effected. The investor's percentage of the
aggregate beneficial interests in that Portfolio will then be recomputed as the
percentage equal to the fraction (i) the numerator of which is the value of such
investor's investment in that Portfolio as of the close of regular trading on
the NYSE, on such day plus or minus, as the case may be, the amount of net
additions to or reductions from the investor's investment in that Portfolio
effected as of that time, and (ii) the denominator of which is the aggregate net
asset value of that Portfolio as of that time, on such day, plus or minus, as
the case may be, the amount of net additions to or reductions from the aggregate
investments in that Portfolio by all investors in that Portfolio. The percentage
so determined will then be applied to determine the value of the investor's
interest in that Portfolio as of the close of regular trading on the NYSE, on
the following day the NYSE is open for trading.

Each Fund, except the Health Care Fund, is classified as a "diversified" fund
under the 1940 Act, which means that, with respect to 75% of the Fund's total
assets: (i) no more than 5% will be invested in the securities of any one
issuer, and (ii) each Fund will purchase no more than 10% of the outstanding
voting securities of any one issuer. The Health Care Fund is a "non-diversified"
investment company under the 1940 Act, which means that, with respect to 50% of
the Fund's total assets, no more than 5% may be invested in the securities of a
single issuer.

SHAREHOLDER INQUIRIES. Shareholder inquiries may be made by calling the Funds
toll-free at (800) 223-2138 or by writing to the Fund at 50 California Street,
27th Floor, San Francisco, California 94111.

PERFORMANCE INFORMATION. The Funds, from time to time, may include information
on their investment results and/or comparisons of its investment results to
various unmanaged indices or results of other mutual funds or groups of mutual
funds in advertisements, sales literature or reports furnished to present or
prospective shareholders.

                               Prospectus Page 54
<PAGE>
                             GT GLOBAL THEME FUNDS

In such materials, the Funds may quote their average annual total return
("Standardized Return"). Standardized Return is calculated separately for each
class of shares of each Fund. Standardized Return shows percentage rates
reflecting the average annual change in the value of an assumed investment in a
Fund at the end of a one-year period and at the end of five- and ten-year
periods, reduced by the maximum applicable sales charge imposed on sales of Fund
shares. If a one-, five- and/or ten-year period has not yet elapsed, data will
be provided as of the end of a shorter period corresponding to the life of a
Fund. Standardized Return assumes the reinvestment of all dividends and other
distributions at net asset value on the reinvestment date as established by the
Board of Directors.

In addition, in order to more completely represent the Funds' performance or
more accurately compare such performance to other measures of investment return,
the Funds also may include in advertisements, sales literature and shareholder
reports other total return performance data ("Non-Standardized Return").
Non-Standardized Return reflects percentage rates of return encompassing all
elements of return (i.e., income and capital appreciation or depreciation) and
assumes reinvestment of all dividends and other distributions. Non-Standardized
Return may be quoted for the same or different periods as those for which
Standardized Return is quoted; it may consist of an aggregate or average annual
percentage rate of return, actual year-by-year rates or any combination thereof.
Non-Standardized Return may or may not take sales charges into account;
performance data calculated without taking the effect of sales charges into
account will be higher than data including the effect of such charges.

The Funds' performance data will reflect past performance and will not
necessarily be indicative of future results. The Funds' investment results will
vary from time to time depending upon market conditions, the composition of its
portfolio and its operating expenses. These factors and possible differences in
calculation methods should be considered when comparing the Fund's investment
results with those published for other investment companies, other investment
vehicles and unmanaged indices. The Funds' results also should be considered
relative to the risks associated with its investment objective and policies. The
Funds will include performance data for all classes of shares of the Funds in
any advertisement or information including performance data for the Funds. See
"Investment Results" in the Statement of Additional Information.

Each Fund's annual report contains additional information with respect to its
performance. The annual report is available to investors upon request and free
of charge.

TRANSFER AGENT. Shareholder servicing, reporting and general transfer agent
functions for the Funds are performed by GT Global Investor Services, Inc. The
Transfer Agent is an affiliate of LGT Asset Management and GT Global, a
subsidiary of Liechtenstein Global Trust and maintains offices at 50 California
Street, 27th Floor, San Francisco, CA 94111.

CUSTODIAN. State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110, is custodian of the assets of the Portfolios, Health Care
Fund and Telecommunications Fund.

COUNSEL. The law firm of Kirkpatrick & Lockhart, 1800 M Street, N.W.,
Washington, D.C. 20036-5891, acts as counsel to the Company and to the Theme
Portfolios. Kirkpatrick & Lockhart also acts as counsel to LGT Asset Management,
GT Global and GT Global Investor Services in connection with other matters.

INDEPENDENT ACCOUNTANTS. The Theme Portfolios' independent accountants are
Coopers & Lybrand L.L.P., One Post Office Square, Boston, Massachusetts 02109.
Coopers & Lybrand L.L.P. conducts an annual audit of the Funds and Portfolios,
assists in the preparation of the Funds' and Portfolios' federal and state
income tax returns and consults with the Company and the Funds and the
Portfolios as to matters of accounting, regulatory filings, and federal and
state income taxation.

MULTIPLE TRANSLATIONS OF THE PROSPECTUS. This Prospectus may be translated into
other languages. In the event of any inconsistency or ambiguity as to the
meaning of any word or phrase contained in a translation, the English text shall
prevail.

                               Prospectus Page 55
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

                               Prospectus Page 56
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

                               Prospectus Page 57
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

                               Prospectus Page 58
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

                               Prospectus Page 59
<PAGE>

<TABLE>
      <S>                     <C>                                                     <C>
[LGT LOGO]
                              GT GLOBAL
                              MUTUAL FUNDS
                              P.O. Box 7345                                                                      ACCOUNT APPLICATION
                              SAN FRANCISCO, CA 94120-7345
                              800/223-2138
</TABLE>

 / / INDIVIDUAL              / / JOINT TENANT             / / GIFT/TRANSFER FOR
 MINOR                            / / TRUST                           / / CORP.
 ACCOUNT REGISTRATION
 / / NEW ACCOUNT
 / / ACCOUNT REVISION (Account No.:
 ---------------------------------------)

 NOTE:  Trust registrations should specify name of trustee(s), beneficiary(ies)
 and date  of trust  instrument. Registration  for Uniform  Gifts/Transfers  to
 Minors  accounts should  be in  the name  of one  custodian and  one minor and
 include the state under which the custodianship is created.

<TABLE>
<S>                                       <C>                             <C>                                                  <C>

  ------------------------------------    --------------------------------------------------------------------------------
  Owner                                   Social  Security  Number  /  /  or  Tax  I.D.  Number  /  /  (Check  applicable  box)
  ------------------------------------    If  more than  one owner,  social security  number or  taxpayer identification number
  Co-owner 1                              should be provided for first owner listed. If a purchase is made under Uniform  Gift/
  ------------------------------------    Transfer  to  Minors Act,  social  security number  of  the minor  must  be provided.
  Co-owner 2                              Resident of /  / U.S.   / / Other  (specify)-----------------------------------------

                                                                          (    )
  ----------------------------------------------------------------------  ---------------------------
  Street Address                                                          Home Telephone
                                                                          (    )
  ----------------------------------------------------------------------  ---------------------------
  City, State, Zip Code                                                   Business Telephone
</TABLE>

 FUND SELECTION $500 minimum initial investment required for each Fund
 selected. Checks should be made payable to "GT GLOBAL."

 TO PURCHASE THE FUNDS LISTED BELOW PLEASE SELECT EITHER / / Class A Shares or
 / / Class B Shares (Not available for purchases of $500,000 or more or for the
                    GT Global Dollar Fund).
 If a class share box is not checked, your investment will be made in Class A
 shares.

<TABLE>
<S>                                                    <C>             <C>                                           <C>       <C>
                                                       INITIAL                                                       INITIAL
                                                       INVESTMENT                                                    INVESTMENT
07 / / GT GLOBAL WORLDWIDE GROWTH FUND                 $               13 / / GT GLOBAL LATIN AMERICA GROWTH FUND    $
                                                       ----------                                                    ----------
05 / / GT GLOBAL INTERNATIONAL GROWTH FUND             $               24 / / GT GLOBAL AMERICA SMALL CAP GROWTH     $
                                                       ----------             FUND                                   ----------
16 / / GT GLOBAL EMERGING MARKETS FUND                 $               06 / / GT GLOBAL AMERICA GROWTH FUND          $
                                                       ----------                                                    ----------
11 / / GT GLOBAL HEALTH CARE FUND                      $               23 / / GT GLOBAL AMERICA VALUE FUND           $
                                                       ----------                                                    ----------
15 / / GT GLOBAL TELECOMMUNICATIONS FUND               $               04 / / GT GLOBAL JAPAN GROWTH FUND            $
                                                       ----------                                                    ----------
19 / / GT GLOBAL INFRASTRUCTURE FUND                   $               10 / / GT GLOBAL GROWTH & INCOME FUND         $
                                                       ----------                                                    ----------
17 / / GT GLOBAL FINANCIAL SERVICES FUND               $               09 / / GT GLOBAL GOVERNMENT INCOME FUND       $
                                                       ----------                                                    ----------
21 / / GT GLOBAL NATURAL RESOURCES FUND                $               08 / / GT GLOBAL STRATEGIC INCOME FUND        $
                                                       ----------                                                    ----------
22 / / GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND   $               18 / / GT GLOBAL HIGH INCOME FUND             $
                                                       ----------                                                    ----------
02 / / GT GLOBAL NEW PACIFIC GROWTH FUND               $               01 / / GT GLOBAL DOLLAR FUND                  $
                                                       ----------                                                    ----------
03 / / GT GLOBAL EUROPE GROWTH FUND                    $
                                                       ----------
  CHECKWRITING PRIVILEGE
 Checkwriting privilege available on Class A shares of GT Global Dollar Fund and GT Global Government Income Fund.
 / / Check here if desired. You will be sent a book of checks.
  CAPITAL GAINS AND DIVIDEND DISTRIBUTIONS                                                TOTAL INITIAL INVESTMENT:  $
                                                                                                                     ----------
 All capital gains and dividend distributions will be reinvested in additional shares of the same class unless appropriate
 boxes below are checked:
 / / Pay capital gain distributions only in cash   / / Pay dividends only in cash   / / Pay capital gain distributions AND
 dividends in cash.
  SPECIAL CAPITAL GAINS AND DIVIDEND DISTRIBUTIONS OPTION
 Pay distributions noted above to another GT Global Mutual Fund: Fund Name ------------------------------------------
</TABLE>

 AGREEMENTS & SIGNATURES

 By  the execution of this Account Application, I/we represent and warrant that
 I/we have full right, power  and authority and am/are  of legal age in  my/our
 state  of  residence  to make  the  investment  applied for  pursuant  to this
 Application. The  person(s),  if  any,  signing  on  behalf  of  the  investor
 represent  and warrant that they are  duly authorized to sign this Application
 and to purchase, redeem  or exchange shares  of the Fund(s)  on behalf of  the
 investor.  I/WE HEREBY AFFIRM THAT I/WE  HAVE RECEIVED A CURRENT PROSPECTUS OF
 THE GT GLOBAL MUTUAL FUND(S) IN WHICH I/WE AM/ARE INVESTING AND I/WE AGREE  TO
 ITS TERMS AND CONDITIONS.

 I/WE  AND MY/OUR ASSIGNS AND SUCCESSORS  UNDERSTAND AND AGREE THAT THE ACCOUNT
 WILL BE SUBJECT TO THE TELEPHONE EXCHANGE AND TELEPHONE REDEMPTION  PRIVILEGES
 DESCRIBED  IN THE CURRENT PROSPECTUS TO WHICH THIS APPLICATION IS ATTACHED AND
 AGREE THAT GT GLOBAL, INC., G.T. GLOBAL GROWTH SERIES, G.T. INVESTMENT  FUNDS,
 INC.,  G.T. INVESTMENT PORTFOLIOS,  INC. AND THE  FUNDS' TRANSFER AGENT, THEIR
 OFFICERS AND EMPLOYEES, WILL NOT BE LIABLE FOR ANY LOSS OR DAMAGES ARISING OUT
 OF ANY SUCH TELEPHONE, TELEX  OR TELEGRAPHIC INSTRUCTIONS REASONABLY  BELIEVED
 TO  BE GENUINE, INCLUDING  ANY SUCH LOSS  OR DAMAGES DUE  TO NEGLIGENCE ON THE
 PART OF  SUCH ENTITIES.  THE INVESTOR(S)  CERTIFIES(Y) AND  AGREE(S) THAT  THE
 CERTIFICATIONS,  AUTHORIZATIONS, DIRECTIONS AND  RESTRICTIONS CONTAINED HEREIN
 WILL  CONTINUE  UNTIL  GT  GLOBAL,  INC.,  G.T.  GLOBAL  GROWTH  SERIES,  G.T.
 INVESTMENT  FUNDS,  INC.,  G.T.  INVESTMENT  PORTFOLIOS,  INC.  OR  THE FUNDS'
 TRANSFER AGENT RECEIVES WRITTEN NOTICE OF ANY CHANGE OR REVOCATION. ANY CHANGE
 IN THESE INSTRUCTIONS MUST BE  IN WRITING AND IN  SOME CASES, AS DESCRIBED  IN
 THE PROSPECTUS, REQUIRES THAT ALL SIGNATURES BE GUARANTEED.

     PLEASE INDICATE THE NUMBER OF SIGNATURES REQUIRED TO PROCESS CHECKS OR
 WRITTEN REDEMPTION REQUESTS:  / / ONE   / / TWO   / / THREE   / / FOUR.

     (If you do not indicate the number of required signatures, ALL account
 owners must sign checks and/or written redemption requests.)

     Under  penalties of  perjury, I  certify that  the Taxpayer Identification
 Number provided on  this form  is my (or  my employer's,  trust's, minor's  or
 other  payee's) true, correct and  complete Number and may  be assigned to any
 new account opened under the exchange  privilege. I further certify that I  am
 (or  the payee  whose Number  is given is)  not subject  to backup withholding
 because: (a) I am (or  the payee is) exempt  from backup withholding; (b)  the
 Internal  Revenue Service (the "I.R.S.") has not notified me that I am (or the
 payee is) subject to backup withholding as a result of a failure to report all
 interest or dividends; OR (c) the I.R.S. has notified me that I am (the  payee
 is) no longer subject to backup withholding;

     OR, / / I am (the payee is) subject to backup withholding.
     ALL ACCOUNT OWNERS MUST SIGN BELOW (Minors are not authorized signers)
  Account revisions may require that signatures be guaranteed. Please see the
                                  Prospectus.

<TABLE>
<S>                                                           <C>
 -----------------------------------------------------------
 Date

 X                                                            X
 ----------------------------------------------------------   ----------------------------------------------------------

 X                                                            X
 ----------------------------------------------------------   ----------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<S>                                                    <C>
 ACCOUNT PRIVILEGES
 TELEPHONE EXCHANGE AND REDEMPTION                     AUTHORITY TO TRANSMIT REDEMPTION PROCEEDS TO
                                                       PRE-DESIGNATED ACCOUNT
 I/We, either directly or through the Authorized       By completing the following section, redemptions
 Agent, if any, named below, hereby authorize the      which exceed $1,000
 Transfer Agent of the GT Global Mutual Funds, to      may be wired or mailed to a Pre-Designated Account
 honor any telephone, telex or telegraphic             at your bank. (Wiring instructions may be obtained
 instructions reasonably believed to be authentic      from your bank.) A bank wire service fee may be
 for redemption and/or exchange between a similar      charged.
 class of shares of any of the Funds distributed
 by GT Global, Inc.                                    --------------------------------------------------
                                                       Name of Bank
 SPECIAL PURCHASE AND REDEMPTION PLANS
  / / I have completed and attached the                --------------------------------------------------
 Supplemental Application for:                         Bank Address
  / / AUTOMATIC INVESTMENT PLAN
 / / SYSTEMATIC WITHDRAWAL PLAN                        --------------------------------------------------
 OTHER                                                 Bank A.B.A Number      Account Number
  / / I/We owned shares of one or more Funds
      distributed by GT Global, Inc. as of April       --------------------------------------------------
      30, 1987 and since that date continuously        Names(s) in which Bank Account is Established
      have owned shares of such Funds. Attached is     A corporation (or partnership) must also submit a
      a schedule showing the numbers of each of        "Corporate Resolution"
      my/our Shareholder Accounts.                     (or "Certificate of Partnership") indicating the
                                                       names and titles of Officers authorized to act on
                                                       its behalf.
</TABLE>

 RIGHT OF ACCUMULATION -- CLASS A SHARES
  / / I/We qualify for the Right of Accumulation sales charge discount
      described in the Prospectus and Statement of Additional Information of
      the Fund purchased.

  / / I/We own shares of more than one Fund distributed by GT Global. Listed
      below are the numbers of each of my/our Shareholder Accounts.

  / / The registration of some of my/our shares differs from that shown on this
      Application. Below are the account number(s) and registration(s) in each
      case.

 LIST OF OTHER G.T. FUND ACCOUNTS:

<TABLE>
<S>                                                    <C>
 -------------------------------------------           --------------------------------------------------
 -------------------------------------------           --------------------------------------------------
 -------------------------------------------           --------------------------------------------------
</TABLE>

 Account Numbers                                 Account Registrations
 LETTER OF INTENT -- CLASS A SHARES

  / / I agree to the terms of the Letter of Intent set forth below. Although I
      am not obligated to do so, it is my intention to invest over a
      thirteen-month period in Class A shares of one or more of the GT Global
      Mutual Funds in an aggregate amount at least equal to:
            / / $50,000     / / $100,000     / / $250,000     / / $500,000

 When a shareholder signs a Letter of Intent in order to qualify for a reduced
 sales charge, Class A shares equal to 5% (in no case in excess of 1/2 of 1%
 after an aggregate of $500,000 has been purchased under the Letter) of the
 dollar amount specified in this Letter will be held in escrow in the
 Shareholder's Account out of the initial purchase (or subsequent purchases, if
 necessary) by GT Global, Inc. All dividends and other distributions will be
 credited to the Shareholder's Account in shares (or paid in cash, if
 requested). If the intended investment is not completed within the specified
 thirteen-month period, the purchaser will remit to GT Global, Inc. the
 difference between the sales charge actually paid and the sales charge which
 would have been paid if the total of such purchases had been made at a single
 time. If this difference is not paid within twenty days after written request
 by GT Global, Inc. or the shareholder's Authorized Agent, the appropriate
 number of escrowed shares will be redeemed to pay such difference. If the
 proceeds from this redemption are inadequate, the purchaser will be liable to
 GT Global, Inc. for the balance still outstanding. The Letter of Intent may be
 revised upward at any time during the thirteen-month period, and such a
 revision will be treated as a new Letter, except that the thirteen-month
 period during which the purchase must be made will remain unchanged. Exchange
 requests involving escrowed shares must specifically reference those shares.
 Exchanges of escrowed shares may be delayed to allow for the extra processing
 required.

 Any questions relating to this Letter of Intent should be directed to GT
 Global, 50 California Street, 27th Floor, San Francisco, CA 94111.
 FOR USE BY AUTHORIZED AGENT (BROKER/DEALER) ONLY

 We hereby submit this Account Application for the purchase of Class A shares
 including such shares purchased under a Right of Accumulation or Letter of
 Intent or for the purchase of Class B shares in accordance with the terms of
 our Dealer Agreement with GT Global, Inc. and with the Prospectus and
 Statement of Additional Information of each Fund purchased. We agree to notify
 GT Global, Inc. of any purchases properly made under a Letter of Intent or
 Right of Accumulation.

 ------------------------------------------------------------------------------
 Investment Dealer Name
 ------------------------------------------------------------------------------
 Main Office Address   Branch Number  Representative's Number  Representative's
 Name
                                                                (     )
 ------------------------------------------------------------------------------
 Branch Address                                                        Telephone

 X
 ------------------------------------------------------------------------------
 Investment Dealer's Authorized Signature                                  Title
<PAGE>

<TABLE>
<S>        <C>                    <C>
[LGT LOGO]
           GT  GLOBAL
           MUTUAL FUNDS
           P.O. Box 7345          SUPPLEMENTAL APPLICATION
           San Francisco, CA      SPECIAL INVESTMENT AND
           94120-7345             WITHDRAWAL OPTIONS
           800/223-2138
</TABLE>

<TABLE>
<S>                                                         <C>                                                         <C>
ACCOUNT REGISTRATION

Please supply the following information exactly as it appears on the Fund's records.

- ---------------------------------------------------------   ---------------------------------------------------------
Fund Name                                                   Account Number

- ----------------------------------------------------------  ----------------------------------------------------------
Owner's Name                                                Co-Owner 1

- ----------------------------------------------------------  ----------------------------------------------------------
Co-Owner 2                                                  Telephone Number

- ----------------------------------------------------------  ----------------------------------------------------------
Street Address                                              Social Security or Tax I.D. Number

- ----------------------------------------------------------
City, State, Zip Code

Resident of  / / U.S.  / / Other  ------------------

AUTOMATIC INVESTMENT PLAN     / / YES  / / NO

I/We hereby authorize the Transfer Agent of the GT Global Mutual Funds to debit my/our personal checking account on
the designated dates in order to purchase / / Class A shares or / / Class B shares of the Fund indicated at the top of
this Supplemental Application at the applicable public offering price determined on that day.

/ / Monthly on the 25th day        / / Quarterly beginning on the 25th day of the month you first select
(The request for participation in the Plan must be received by the 1st day of the month in which you wish investments
to begin.)

Amount of each debit (minimum $100)  $
                                     -------------------------------------------------

NOTE:  A Bank  Authorization Form (below)  and a voided  personal check  must accompany the  Automatic Investment Plan
Application.
</TABLE>

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

<TABLE>
<S>        <C>                            <C>
[LOGO]
           GT GLOBAL
           MUTUAL FUNDS                                                               AUTOMATIC INVESTMENT PLAN
</TABLE>

<TABLE>
<S>                                                         <C>                                                         <C>
BANK AUTHORIZATION
</TABLE>

<TABLE>
<S>                        <C>                             <C>                   <C>
- -------------------------  ------------------------------  ------------
Bank Name                  Bank Address                    Bank Account Number
I/We authorize you, the above named bank, to debit my/our account for amounts drawn by the Transfer Agent of the GT
Global Mutual Funds, acting as my agent. I/We agree that your rights in respect to each withdrawal shall be the same as
if it were a check drawn upon you and signed by me/us. This authority shall remain in effect until I/we revoke it in
writing and you receive it. I/We agree that you shall incur no liability when honoring any such debit.
I/We further agree that you will incur no liability to me if you dishonor any such withdrawal. This will be so even
though such dishonor results in the forfeiture of investment.

- ---------------------------------------------------------    ---------------------------------------------------------
Account Holder's Name                                        Joint Account Holder's Name

X                                                            X
- ------------------------------------      --------------     ------------------------------------      --------------
Account Holder's Signature                Date               Joint Account Holder's Signature          Date
</TABLE>

                                     (OVER)
<PAGE>

<TABLE>
<S>                             <C>                          <C>                                                        <C>

SYSTEMATIC WITHDRAWAL PLAN    / / YES  / / NO
MINIMUM REQUIREMENTS: $10,000 INITIAL ACCOUNT BALANCE AND $100 MINIMUM PERIODIC PAYMENT.
I/We hereby authorize the Transfer Agent of the GT Global Mutual Funds to redeem the necessary number of / / Class A
or / / Class B shares from my/our GT Global Account on the designated dates in order to make the following periodic
payments:
/ / Monthly on the 25th day        / / Quarterly beginning on the 25th day of the month you first select
(The request for participation in the Plan must be received by the 18th day of the month in which you wish withdrawals
to begin.)
Maximum annual withdrawal of 12% of initial account balance for shares subject to a contingent deferred sales charge.
Withdrawals in excess of 12% of the initial account balance annually may result in assessment of a contingent deferred
sales charge, as described in the applicable Fund's prospectus.
Amount of each check ($100 minimum): $ -----------------

Please make checks payable to:  --------------------------------------------------------------------------------------
(TO  BE   COMPLETED  ONLY   IF  Recipient
REDEMPTION PROCEEDS TO BE PAID  --------------------------------------------------------------------------------------
TO  OTHER THAN  ACCOUNT HOLDER  Street Address
OF RECORD OR MAILED TO ADDRESS  --------------------------------------------------------------------------------------
OTHER THAN ADDRESS OF RECORD)   City, State, Zip Code
NOTE: If recipient of checks is not the registered shareholder, signature(s) below must be guaranteed. A corporation
(or partnership) must also submit a "Corporate Resolution" (or "Certification of Partnership") indicating the names
and titles of Officers authorized to act on its behalf.
AGREEMENT AND SIGNATURES
The investor(s) certifies(y) and agree(s) that the certifications, authorizations, directions and restrictions
contained herein will continue until the Transfer Agent of the GT Global Mutual Funds receives written notice of any
change or revocation. Any change in these instructions must be in writing with all signatures guaranteed (if
applicable).

- ----------------------------------------------------------
Date
X                                                            X
- -----------------------------------------------------        ---------------------------------------------------
Signature                                                    Signature

- -----------------------------------------------------------  ---------------------------------------------------------
Signature Guarantee* (if applicable)                         Signature Guarantee* (if applicable)
X                                                            X
- -----------------------------------------------------        ---------------------------------------------------
Signature                                                    Signature

- -----------------------------------------------------------  ---------------------------------------------------------
Signature Guarantee* (if applicable)                         Signature Guarantee* (if applicable)
*Acceptable signature guarantors: (1) a commercial bank; (2) a U.S. trust company; (3) a member firm of a U.S. stock
exchange;
(4) a foreign branch of any of the foregoing; or (5) any other eligible guarantor institution. A notary public is NOT
an acceptable guarantor. An investor with questions concerning the GT Global Mutual Funds signature guarantee
requirement should contact the Transfer Agent.
</TABLE>

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

INDEMNIFICATION AGREEMENT

To: Bank Named on the Reverse

In consideration of your compliance with the request and authorization of the
depositor(s) named on the reverse, the Transfer Agent of the GT Global Mutual
Funds hereby agrees:

1. To indemnify and hold you harmless from any loss you may incur because of the
payment by you and of any debit by the Transfer Agent to its own order on the
account of such depositor(s) and received by you in the regular course of
business for payment, or arising out of the dishonor by you of any debit,
provided there are sufficient funds in such account to pay the same upon
presentation.

2. To defend at its own expense any action which might be brought by any
depositor or any other persons because of your actions taken pursuant to the
above mentioned request or in any manner arising by reason of your participation
in connection with such request.
<PAGE>
                             GT GLOBAL THEME FUNDS

                             GT GLOBAL MUTUAL FUNDS

  GT GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY INVESTORS'
  PORTFOLIOS.  FOR MORE INFORMATION AND  A PROSPECTUS ON ANY  OF THE GT GLOBAL
  MUTUAL FUNDS, PLEASE  CONTACT YOUR  INVESTMENT COUNSELOR OR  CALL GT  GLOBAL
  DIRECTLY AT 1-800-824-1580.

GROWTH FUNDS

/ / GLOBALLY DIVERSIFIED FUNDS

GT GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.

GT GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside
the U.S.

GT GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies

/ / GLOBAL THEME FUNDS

GT GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide

GT GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment

GT GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain a country's infrastructure

GT GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products

GT GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources

GT GLOBAL CONSUMER PRODUCTS AND
SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services

/ / REGIONALLY DIVERSIFIED FUNDS

GT GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan

GT GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe

GT GLOBAL LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America

/ / SINGLE COUNTRY FUNDS

GT GLOBAL AMERICA SMALL CAP GROWTH FUND
Invests in equity securities of small U.S. companies

GT GLOBAL AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.

GT GLOBAL AMERICA VALUE FUND
Concentrates on equity securities of large cap U.S. companies believed to be
undervalued

GT GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market

GROWTH AND INCOME FUND

GT GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world

INCOME FUNDS

GT GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities

GT GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets

GT GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets

MONEY MARKET FUND

GT GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities

worldwide for stability and preservation of capital

[LOGO]

  NO  DEALER,  SALESMAN  OR  OTHER  PERSON HAS  BEEN  AUTHORIZED  TO  GIVE ANY
  INFORMATION OR TO MAKE ANY  REPRESENTATION NOT CONTAINED IN THIS  PROSPECTUS
  AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
  UPON  AS HAVING  BEEN AUTHORIZED BY  G.T. INVESTMENT FUNDS,  INC., GT GLOBAL
  FINANCIAL SERVICES FUND, GT GLOBAL  FINANCIAL SERVICES PORTFOLIO, GT  GLOBAL
  INFRASTRUCTURE  FUND, GT GLOBAL INFRASTRUCTURE  PORTFOLIO, GT GLOBAL NATURAL
  RESOURCES FUND, GT  GLOBAL NATURAL RESOURCES  PORTFOLIO, GT GLOBAL  CONSUMER
  PRODUCTS  AND  SERVICES  FUND,  GT  GLOBAL  CONSUMER  PRODUCTS  AND SERVICES
  PORTFOLIO, GT GLOBAL  HEALTH CARE FUND,  GT GLOBAL TELECOMMUNICATIONS  FUND,
  LGT  ASSET  MANAGEMENT, INC.  OR GT  GLOBAL, INC.  THIS PROSPECTUS  DOES NOT
  CONSTITUTE AN OFFER TO SELL OR SOLICITATION  OF ANY OFFER TO BUY ANY OF  THE
  SECURITIES  OFFERED  HEREBY  IN  ANY  JURISDICTION  TO  ANY  PERSON  IN SUCH
  JURISDICTION TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER.

                                                                   THEPR601250MC
<PAGE>
                             GT GLOBAL THEME FUNDS

                        50 California Street, 27th Floor
                        San Francisco, California 94111
                                 (415) 392-6181
                           Toll Free: (800) 824-1580

                      Statement of Additional Information

                   March 1, 1995, as Revised January 5, 1996
- --------------------------------------------------------------------------------

This  Statement of  Additional Information  relates to the  Class A  and Class B
shares of  GT Global  Financial Services  Fund ("Financial  Services Fund"),  GT
Global  Infrastructure Fund ("Infrastructure Fund"), GT Global Natural Resources
Fund ("Natural Resources Fund"), GT  Global Consumer Products and Services  Fund
("Consumer  Products and  Services Fund"), GT  Global Health  Care Fund ("Health
Care Fund") and  GT Global Telecommunications  Fund ("Telecommunications  Fund")
(individually,  "Fund" or "Theme Fund," collectively, "Funds" or "Theme Funds").
Each Fund  (except  for  Health Care  Fund)  is  a diversified  series  of  G.T.
Investment  Funds, Inc. ("Company"), a registered open-end management investment
company. The Health Care  Fund is organized as  a non-diversified series of  the
Company.  The Financial  Services Fund,  Infrastructure Fund,  Natural Resources
Fund and  Consumer  Products and  Services  Fund (individually,  "Feeder  Fund,"
collectively,  "Feeder  Funds") invest  all of  their  investable assets  in the
Global Financial  Services Portfolio,  Global Infrastructure  Portfolio,  Global
Natural  Resources Portfolio and Global Consumer Products and Services Portfolio
(individually,  "Portfolio,"  collectively,  "Portfolios"),  respectively.  This
Statement  of Additional Information, which is not a prospectus, supplements and
should be read in conjunction  with the GT Global  Theme Funds' current Class  A
and  Class B Prospectus dated March 1, 1995,  as revised January 5, 1996, a copy
of which is available without charge by writing to the above address or  calling
the Funds at the toll-free telephone number printed above.

LGT  Asset Management,  Inc. ("LGT Asset  Management") serves  as the investment
manager of and administrator for  the Health Care Fund, Telecommunications  Fund
and  the  Portfolios  (each  a  "Theme  Portfolio"),  and  also  serves  as  the
administrator for each Feeder Fund. The principal underwriter and distributor of
the Funds' shares is GT Global, Inc. ("GT Global"). The Funds' transfer agent is
GT Global Investor Services, Inc. ("GT Services" or "Transfer Agent").

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

                               TABLE OF CONTENTS

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

<TABLE>
<CAPTION>
                                                                                                      Page No.
                                                                                                      --------
<S>                                                                                                   <C>
Investment Objective and Policies...................................................................      2
Options, Futures and Currency Strategies............................................................      6
Risk Factors........................................................................................     14
Investment Limitations..............................................................................     17
Execution of Portfolio Transactions.................................................................     22
Directors and Executive Officers....................................................................     24
Management..........................................................................................     26
Valuation of Fund Shares............................................................................     31
Information Relating to Sales and Redemptions.......................................................     32
Taxes...............................................................................................     35
Additional Information..............................................................................     38
Investment Results..................................................................................     39
Description of Debt Ratings.........................................................................     51
Financial Statements................................................................................     53
</TABLE>

[LOGO]

                   Statement of Additional Information Page 1
<PAGE>
                             GT GLOBAL THEME FUNDS

                              INVESTMENT OBJECTIVE
                                  AND POLICIES

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

INVESTMENT OBJECTIVE
The  investment objective of  each Feeder Fund is  long-term capital growth. The
investment objective of the  GT Global Health  Care Fund and  Telecommunications
Fund  is  long-term  capital  appreciation  and  long-term  growth  of  capital,
respectively.

The Financial Services  Fund, Infrastructure  Fund, Natural  Resources Fund  and
Consumer  Products  and  Services  Fund each  seeks  to  achieve  its investment
objective by investing all  of its investable assets  in the Financial  Services
Portfolio,  Infrastructure Portfolio,  Natural Resources  Portfolio and Consumer
Products and Services Portfolio,  respectively, each of which  is a subtrust  (a
"series")  of  Global Investment  Portfolio  (an open-end  management investment
company) with  an  investment  objective  that  is  identical  to  that  of  its
corresponding Fund. Whenever the phrase "all of the Funds' investable assets" is
used  herein and in the Prospectus, it means that the only investment securities
that will  be  held by  a  Feeder  Fund will  be  that Fund's  interest  in  its
corresponding  Portfolio.  A  Feeder Fund  may  withdraw its  investment  in its
corresponding Portfolio at any  time, if the Board  of Directors of the  Company
determines that it is in the best interests of such Fund and its shareholders to
do  so. Upon any  such withdrawal, a  Feeder Fund's assets  would be invested in
accordance with the investment  policies described below  and in the  Prospectus
with respect to its corresponding Portfolio.

In  analyzing the natural resource industry, LGT Asset Management has identified
four areas that it expects  will create investment opportunities: (i)  improving
supply/demand  fundamentals, which may  result in higher  commodity prices; (ii)
privatization of state-owned natural resource businesses; (iii) management which
can improve production efficiencies without correspondingly increasing commodity
prices; and (iv) service companies  with emerging technologies that can  enhance
productivity  or reduce production costs. Of  course, there is no certainty that
these factors will produce the anticipated results.

In  analyzing  the  telecommunications   industry,  LGT  Asset  Management   has
identified  four areas that it expects will create investment opportunities: (i)
deregulation of  companies in  the  industry, which  will allow  competition  to
promote    greater    efficiencies;    (ii)    privatization    of   state-owned
telecommunications  businesses;   (iii)   development   of   infrastructure   in
underdeveloped  countries and upgrading of services in other countries; and (iv)
emerging technologies that  will enhance  productivity and reduce  costs in  the
telecommunications industry. Of course, there is no certainty that these factors
will produce the anticipated results.

There  may be  times when,  in the opinion  of LGT  Asset Management, prevailing
market, economic or political conditions warrant reducing the proportion of  the
Theme  Portfolios'  assets  invested  in equity  securities  and  increasing the
proportion held  in  cash (U.S.  dollars,  foreign currencies  or  multinational
currency  units) or  invested in  debt securities  or high  quality money market
instruments  issued  by  corporations,  or  the  United  States,  or  a  foreign
government.  A portion of each Theme Portfolio's assets normally will be held in
cash (U.S.  dollars,  foreign currencies  or  multinational currency  units)  or
invested  in foreign or  domestic high quality  money market instruments pending
investment of proceeds  from new  sales of Fund  shares to  provide for  ongoing
expenses and redemptions.

SELECTION OF EQUITY INVESTMENTS
For   each  Theme  Portfolio's  investment  purposes,  an  issuer  is  typically
considered as located in  a particular country if  it is incorporated under  the
laws  of that country,  at least 50% of  the value of its  assets are located in
that country and it normally derives at least 50% of its income from  operations
or  sales in  that country.  However, these  are not  absolute requirements, and
certain companies incorporated  in a  particular country and  considered by  LGT
Asset  Management to  be located  in that  country may  have substantial foreign
operations or subsidiaries and/or export sales  exceeding in size the assets  or
sales in that country.

In  certain  countries,  governmental  restrictions  and  other  limitations  on
investment may affect a Theme Portfolio's  ability to invest in such  countries.
In  addition,  in  some instances  only  special  classes of  securities  may be
purchased by foreigners and the market prices, liquidity and rights with respect
to those  securities  may  vary  from  shares  owned  by  nationals.  LGT  Asset
Management  is not  aware at  this time  of the  existence of  any investment or
exchange control regulations which might substantially impair the operations  of
the  Theme  Portfolios as  described  in the  Prospectus  and this  Statement of

                   Statement of Additional Information Page 2
<PAGE>
                             GT GLOBAL THEME FUNDS
Additional Information.  Restrictions  may  in  the  future,  however,  make  it
undesirable  to invest in  certain countries. It should  be noted, however, that
this situation could  change at any  time. None  of the Theme  Portfolios has  a
present  intention of making any significant  investment in any country or stock
market where the  political or  economic situation  might be  considered by  LGT
Asset Management to threaten a Theme Portfolio with substantial or total loss of
its investment in such country or market.

INVESTMENTS IN OTHER INVESTMENT COMPANIES
Each Theme Portfolio may invest in the securities of investment companies within
the  limits  of  the 1940  Act.  These  limitations currently  provide  that, in
general, a Theme Portfolio may purchase  shares of an investment company  unless
(a)  such a purchase would cause a Theme  Portfolio to own in the aggregate more
than 3% of the total outstanding voting  stock of the investment company or  (b)
such  a purchase  would cause the  Theme Portfolio to  have more than  5% of its
assets invested  in  the investment  company  or more  than  10% of  its  assets
invested  in  an  aggregate  of all  such  investment  companies.  The foregoing
restrictions do not  apply to  the investment  of the  Financial Services  Fund,
Infrastructure  Fund, Natural Resources Fund  and Consumer Products and Services
Fund in  their corresponding  Portfolios.  Investment in  closed-end  investment
companies  may also involve the payment  of substantial premiums above the value
of such companies' portfolio securities. Each Theme Portfolio does not intend to
invest in  such  investment companies  unless,  in  the judgment  of  LGT  Asset
Management,  the potential benefits  of such investments  justify the payment of
any applicable  premiums.  The yield  of  such  securities will  be  reduced  by
operating  expenses  of such  companies,  including payments  to  the investment
managers of those investment companies.

DEPOSITORY RECEIPTS
A Theme Portfolio may hold securities of foreign issuers in the form of American
Depository Receipts ("ADRs"), American  Depository Shares ("ADSs") and  European
Depository  Receipts ("EDRs") or other securities convertible into securities of
eligible foreign issuers. These securities may not necessarily be denominated in
the same currency as the  securities for which they  may be exchanged. ADRs  and
ADSs  are typically issued by an American  bank or trust company which evidences
ownership of underlying securities issued by a foreign corporation. EDRs,  which
are  sometimes  referred to  as  Continental Depository  Receipts  ("CDRs"), are
receipts issued in Europe  typically by foreign banks  and trust companies  that
evidence ownership of either foreign or domestic securities. Generally, ADRs and
ADSs in registered form are designed for use in U.S. securities markets and EDRs
in bearer form are designed for use in European securities markets. For purposes
of  each Theme Portfolio's investment  policies, a Theme Portfolio's investments
in ADRs, ADSs and EDRs will be deemed to be investments in the equity securities
representing securities of foreign issuers into which they may be converted.

ADR facilities may be established as either "unsponsored" or "sponsored."  While
ADRs  issued under these two  types of facilities are  in some respects similar,
there are distinctions between  them relating to the  rights and obligations  of
ADR holders and the practices of market participants. A depository may establish
an  unsponsored  facility  without  participation by  (or  even  necessarily the
acquiescence of) the issuer of the deposited securities, although typically  the
depository  requests a  letter of  non-objection from  such issuer  prior to the
establishment of the facility.  Holders of unsponsored  ADRs generally bear  all
the  costs  of such  facilities. The  depository usually  charges fees  upon the
deposit and withdrawal of the deposited securities, the conversion of  dividends
into   U.S.  dollars,  the  disposition   of  non-cash  distributions,  and  the
performance of  other  services.  The  depository  of  an  unsponsored  facility
frequently  is  under  no obligation  to  distribute  shareholder communications
received from the issuer of the  deposited securities or to pass-through  voting
rights  to ADR  holders in  respect of  the deposited  securities. Sponsored ADR
facilities are created in generally  the same manner as unsponsored  facilities,
except  that  the  issuer of  the  deposited  securities enters  into  a deposit
agreement with the  depository. The deposit  agreement sets out  the rights  and
responsibilities  of  the  issuer,  the depository  and  the  ADR  holders. With
sponsored facilities, the issuer of the deposited securities generally will bear
some of the costs relating to the facility (such as dividend payment fees of the
depository), although ADR holders continue to bear certain other costs (such  as
deposit  and withdrawal fees).  Under the terms  of most sponsored arrangements,
depositories agree  to distribute  notices of  shareholder meetings  and  voting
instructions, and to provide shareholder communications and other information to
the  ADR holders at the  request of the issuer  of the deposited securities. The
Theme Portfolios may invest in both sponsored and unsponsored ADRs.

WARRANTS OR RIGHTS
Warrants or rights may be acquired by a Theme Portfolio in connection with other
securities or  separately and  provide the  Theme Portfolio  with the  right  to
purchase  at a  later date  other securities  of the  issuer. As  a condition of
continued registration in a state, each Theme Portfolio has undertaken that  its
investments  in warrants or rights, valued at  the lower of cost or market, will
not exceed 5% of the value of its net assets and not more than 2% of such assets
will be invested in warrants and rights which are not listed on the American  or
New  York Stock Exchange.  Warrants or rights  acquired by a  Theme Portfolio in
units or attached to securities will be deemed to be without value for  purposes
of this restriction.

                   Statement of Additional Information Page 3
<PAGE>
                             GT GLOBAL THEME FUNDS

LENDING OF PORTFOLIO SECURITIES
For  the purpose of  realizing additional income, each  Theme Portfolio may make
secured loans of its securities holdings amounting  to not more than 30% of  its
total  assets.  Securities loans  are  made to  broker/dealers  or institutional
investors pursuant  to  agreements  requiring that  the  loans  be  continuously
secured by collateral at least equal at all times to the value of the securities
lent  plus  any accrued  interest,  "marked to  market"  on a  daily  basis. The
collateral received will consist of cash, U.S. short-term government securities,
bank letters of  credit or such  other collateral  as may be  permitted under  a
Theme Portfolio's investment policies and by regulatory agencies and approved by
the  Portfolios'  Board of  Trustees  or the  Company's  Board of  Directors, as
applicable. The Theme Portfolios may pay reasonable administrative and custodial
fees in connection with the loans of their securities. While the securities loan
is outstanding, a Theme Portfolio will continue to receive the equivalent of the
interest or dividends paid by the issuer on the securities, as well as  interest
on  the  investment  of the  collateral  or a  fee  from the  borrower.  A Theme
Portfolio will have a right to call each loan and obtain the securities on  five
business  days' notice. A Theme Portfolio will not have the right to vote equity
securities while they are being lent, but it may call in a loan in  anticipation
of  any important vote. The risks in lending portfolio securities, as with other
extensions of secured credit, consist of possible delay in receiving  additional
collateral  or in recovery of  the securities or possible  loss of rights in the
collateral should the  borrower fail  financially. Loans  will only  be made  to
firms deemed by LGT Asset Management to be of good standing and will not be made
unless,  in the judgment of LGT Asset Management, the consideration to be earned
from such loans would justify the risk.

COMMERCIAL BANK OBLIGATIONS
For the purposes of each Theme  Portfolio's investment policies with respect  to
bank  obligations, obligations of foreign branches  of U.S. banks and of foreign
banks are obligations of the issuing bank and may be general obligations of  the
parent  bank.  Such obligations  may,  however, be  limited  by the  terms  of a
specific obligation  and  by  government  regulation.  As  with  investments  in
non-U.S.  securities  in  general,  investments in  the  obligations  of foreign
branches of U.S. banks and of foreign banks may subject each Theme Portfolio  to
investment  risks that are different in  some respects from those of investments
in obligations of  U.S. issuers.  Although each Theme  Portfolio will  typically
acquire  obligations issued and supported by the credit of U.S. or foreign banks
having total assets  at the  time of  purchase of $1  billion or  more, this  $1
billion  figure  is  not  an  investment policy  or  restriction  of  each Theme
Portfolio. For  the purposes  of  calculation with  respect  to the  $1  billion
figure,  the assets of a bank  will be deemed to include  the assets of its U.S.
and non-U.S. branches.

REPURCHASE AGREEMENTS
Each Theme Portfolio will invest only in repurchase agreements collateralized at
all times in  an amount  at least  equal to  the repurchase  price plus  accrued
interest.  To the extent that the proceeds from any sale of such collateral upon
a default in the obligation to repurchase were less than the repurchase price, a
Theme Portfolio would suffer a loss. If the financial institution which is party
to the  repurchase  agreement  petitions for  bankruptcy  or  otherwise  becomes
subject   to  bankruptcy  or   other  liquidation  proceedings,   there  may  be
restrictions on a Theme Portfolio's ability  to sell the collateral and a  Theme
Portfolio  could suffer a loss. However,  with respect to financial institutions
whose bankruptcy or liquidation proceedings  are subject to the U.S.  Bankruptcy
Code,  each Theme  Portfolio intends to  comply with provisions  under such Code
that would allow the immediate resale  of such collateral. Each Theme  Portfolio
will  not enter into a  repurchase agreement with a  maturity of more than seven
days if, as a result, more than 15%  of the value of its net assets (except  for
Health Care Fund, which is more than 10% of the value of its total assets) would
be invested in such repurchase agreements and other illiquid investments.

BORROWING, REVERSE REPURCHASE AGREEMENTS AND "ROLL" TRANSACTIONS
Each  Theme Portfolio's borrowings will not exceed  33 1/3% of its total assets,
i.e., the Theme Portfolio's total assets at  all times will equal at least  300%
of  the amount of outstanding borrowings. If market fluctuations in the value of
a Theme Portfolio's securities  holdings or other factors  cause the ratio of  a
Theme  Portfolio's total  assets to outstanding  borrowings to  fall below 300%,
within three days  (excluding Sundays  and holidays)  of such  event that  Theme
Portfolio may be required to sell portfolio securities to restore the 300% asset
coverage,  even  though  from  an  investment  standpoint  such  sales  might be
disadvantageous. Each Theme  Portfolio may  also borrow up  to 5%  of its  total
assets  for temporary or emergency purposes  other than to meet redemptions. Any
borrowing by a Theme Portfolio may cause greater fluctuation in the value of its
shares than would be the case if that Theme Portfolio did not borrow.

Each Theme  Portfolio's  fundamental  investment limitations  permit  the  Theme
Portfolio to borrow money for leveraging purposes. However, each Theme Portfolio
(except  the  Health Care  Fund)  is currently  prohibited,  pursuant to  a non-
fundamental investment  policy,  from  borrowing  money  in  order  to  purchase
securities.  Nevertheless,  this policy  may  be changed  in  the future  by the
Company's  Board  of  Directors  or  the  Portfolios'  Board  of  Trustees,   as
applicable.  In the event that a Theme Portfolio employs leverage in the future,
it would be  subject to  certain additional risks.  Use of  leverage creates  an
opportunity  for greater growth of capital but would exaggerate any increases or
decreases in the net asset value

                   Statement of Additional Information Page 4
<PAGE>
                             GT GLOBAL THEME FUNDS
of the Financial  Services Fund,  Infrastructure Fund,  Natural Resources  Fund,
Consumer  Products and Services Fund  or a Theme Portfolio.  When the income and
gains on securities purchased with the  proceeds of borrowings exceed the  costs
of  such borrowings, a  Theme Portfolio's earnings  or a Fund's  net asset value
will increase  faster than  otherwise would  be the  case; conversely,  if  such
income  and gains fail to  exceed such costs, a  Theme Portfolio's earnings or a
Fund's net asset value would decline faster than would otherwise be the case.

Each Theme Portfolio may enter into reverse repurchase agreements, which involve
the sale of a security by a Theme Portfolio and its agreement to repurchase  the
security  at a specified time and price. Each Theme Portfolio may also engage in
"roll" transactions,  which involve  the sale  of Government  National  Mortgage
Association ("GNMA") certificates or other securities together with a commitment
(for  which the Theme Portfolio may receive  a fee) to purchase similar, but not
identical, securities at a future date. Each Theme Portfolio will maintain, in a
segregated account with a custodian,  cash, U.S. government securities or  other
liquid,  high-grade  debt  securities  in  an  amount  sufficient  to  cover its
obligations under  "roll" transactions  and reverse  repurchase agreements  with
broker/dealers.  No segregation  is required  for reverse  repurchase agreements
with banks.

SHORT SALES
Each Theme Portfolio (except the Health  Care Fund) is authorized to make  short
sales  of securities. A short  sale is a transaction  in which a Theme Portfolio
sells a security  in anticipation that  the market price  of that security  will
decline.  A Theme  Portfolio may make  short sales (i)  as a form  of hedging to
offset  potential  declines  in  long  positions  in  securities  it  owns,   or
anticipates  acquiring, or in similar securities,  and (ii) in order to maintain
flexibility in its securities holdings.

When a Theme Portfolio makes a short sale of a security it does not own, it must
borrow the security  sold short  and deliver it  to the  broker/dealer or  other
intermediary  through which it made the short sale. The Theme Portfolio may have
to pay a fee to borrow particular securities and will often be obligated to  pay
over any payments received on such borrowed securities.

A  Theme  Portfolio's  obligation  to replace  the  borrowed  security  when the
borrowing is called or expires will be secured by collateral (usually cash, U.S.
government securities or  other liquid,  high grade  debt securities)  deposited
with  the intermediary.  The Theme  Portfolio will  also be  required to deposit
similar collateral with its custodian to  the extent, if any, necessary so  that
the  value of both collateral deposits in the aggregate is at all times equal to
at least 100% of the current market value of the security sold short.  Depending
on  arrangements made with the intermediary  from which it borrowed the security
regarding payment  of any  amounts  received by  that  Theme Portfolio  on  such
security, a Theme Portfolio may not receive any payments (including interest) on
its collateral deposited with such intermediary.

If  the price of the security sold short increases between the time of the short
sale and the time a Theme  Portfolio replaces the borrowed security, that  Theme
Portfolio  will  incur a  loss;  conversely, if  the  price declines,  the Theme
Portfolio will  realize  a  gain. Any  gain  will  be decreased,  and  any  loss
increased,  by the transaction costs associated with the transaction. Although a
Theme Portfolio's gain is  limited by the  price at which  it sold the  security
short, its potential loss theoretically is unlimited.

No  Theme Portfolio will make a short sale if, after giving effect to such sale,
the market value of the  securities sold short exceeds 25%  of the value of  its
total assets or the Theme Portfolio's aggregate short sales of the securities of
any one issuer exceed the lesser of 2% of the Theme Portfolio's net assets or 2%
of  the securities of any  class of the issuer.  Moreover, a Theme Portfolio may
engage in  short sales  only with  respect to  securities listed  on a  national
securities  exchange. A Theme  Portfolio may make short  sales "against the box"
without respect to such limitations. In this type of short sale, at the time  of
the  sale the  Theme Portfolio owns  the security it  has sold short  or has the
immediate and unconditional right to acquire at no additional cost the identical
security.

                   Statement of Additional Information Page 5
<PAGE>
                             GT GLOBAL THEME FUNDS

                         OPTIONS, FUTURES AND CURRENCY
                                   STRATEGIES

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

SPECIAL RISKS OF OPTIONS, FUTURES AND CURRENCY STRATEGIES
The use of options, futures  contracts and forward currency contracts  ("Forward
Contracts") involves special considerations and risks, as described below. Risks
pertaining to particular instruments are described in the sections that follow.

        (1)  Successful use of most of  these instruments depends upon LGT Asset
    Management's ability  to predict  movements of  the overall  securities  and
    currency markets, which requires different skills than predicting changes in
    the   prices  of  individual  securities.  While  LGT  Asset  Management  is
    experienced in the use of these instruments, there can be no assurance  that
    any particular strategy adopted will succeed.

        (2)  There  might  be  imperfect correlation,  or  even  no correlation,
    between price  movements  of  an  instrument  and  price  movements  of  the
    investments being hedged. For example, if the value of an instrument used in
    a  short hedge  increased by less  than the  decline in value  of the hedged
    investment, the  hedge  would  not  be fully  successful.  Such  a  lack  of
    correlation  might  occur  due to  factors  unrelated  to the  value  of the
    investments being  hedged, such  as speculative  or other  pressures on  the
    markets  in which  the hedging  instrument is  traded. The  effectiveness of
    hedges using hedging  instruments on indices  will depend on  the degree  of
    correlation  between price movements in the index and price movements in the
    investments being hedged.

        (3) Hedging strategies, if successful, can reduce risk of loss by wholly
    or partially offsetting the negative  effect of unfavorable price  movements
    in the investments being hedged. However, hedging strategies can also reduce
    opportunity  for gain by  offsetting the positive  effect of favorable price
    movements in  the hedged  investments.  For example,  if a  Theme  Portfolio
    entered  into a short hedge because LGT Asset Management projected a decline
    in the price of a security in the Theme Portfolio's portfolio, and the price
    of that security  increased instead, the  gain from that  increase might  be
    wholly  or  partially  offset by  a  decline  in the  price  of  the hedging
    instrument. Moreover, if  the price  of the hedging  instrument declined  by
    more  than the increase  in the price  of the security,  the Theme Portfolio
    could suffer a  loss. In either  such case, the  Theme Portfolio would  have
    been in a better position had it not hedged at all.

        (4)  As  described  below,  the Theme  Portfolio  might  be  required to
    maintain assets  as "cover,"  maintain segregated  accounts or  make  margin
    payments  when it  takes positions  in instruments  involving obligations to
    third parties (I.E., instruments other than purchased options). If the Theme
    Portfolio were unable  to close out  its positions in  such instruments,  it
    might  be required to continue  to maintain such assets  or accounts or make
    such payments until the position expired or matured. The requirements  might
    impair the Theme Portfolio's ability to sell a portfolio security or make an
    investment  at a  time when  it would  otherwise be  favorable to  do so, or
    require  that  the  Theme   Portfolio  sell  a   portfolio  security  at   a
    disadvantageous  time. The Theme Portfolio's ability to close out a position
    in an instrument prior to expiration or maturity depends on the existence of
    a liquid secondary market or, in the  absence of such a market, the  ability
    and  willingness of the  other party to the  transaction ("contra party") to
    enter into a transaction  closing out the position.  Therefore, there is  no
    assurance  that any position can  be closed out at a  time and price that is
    favorable to the Theme Portfolio.

WRITING CALL OPTIONS
Each Theme Portfolio may  write (sell) call options  on securities, indices  and
currencies.  Call options generally will be written on securities and currencies
that, in the opinion of LGT  Asset Management, the Theme Portfolios'  investment
manager,  are not expected to make any major  price moves in the near future but
that, over the long term, are deemed to be attractive investments for the  Theme
Portfolios.

A  call option  gives the  holder (buyer)  the right  to purchase  a security or
currency at a specified price (the  exercise price) at any time until  (American
style)  or on (European style) a certain  date (the expiration date). So long as
the obligation  of the  writer of  a call  option continues,  he or  she may  be
assigned  an exercise  notice, requiring  him or  her to  deliver the underlying
security or  currency against  payment of  the exercise  price. This  obligation
terminates upon the expiration of the call option, or such earlier time at which
the  writer  effects  a closing  purchase  transaction by  purchasing  an option
identical to that previously sold.

                   Statement of Additional Information Page 6
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                             GT GLOBAL THEME FUNDS

Portfolio securities or currencies on which call options may be written will  be
purchased  solely on the basis of investment considerations consistent with each
Theme Portfolio's  investment objective.  When writing  a call  option, a  Theme
Portfolio, in return for the premium, gives up the opportunity for profit from a
price  increase in the underlying security or currency above the exercise price,
and retains  the risk  of loss  should the  price of  the security  or  currency
decline.  Unlike one who owns securities or currencies not subject to an option,
a Theme  Portfolio has  no control  over when  it may  be required  to sell  the
underlying  securities or currencies, since most options may be exercised at any
time prior to the option's expiration. If  a call option that a Theme  Portfolio
has  written expires, the Theme  Portfolio will realize a  gain in the amount of
the premium; however, such gain may be  offset by a decline in the market  value
of  the underlying security  or currency during  the option period.  If the call
option is exercised, the Theme  Portfolio will realize a  gain or loss from  the
sale  of the underlying security or currency,  which will be increased or offset
by the premium received.  Each Theme Portfolio does  not consider a security  or
currency  covered by a call option to be  "pledged" as that term is used in that
Theme Portfolio's policy that limits the pledging or mortgaging of its assets.

Writing call options can serve as a limited short hedge because declines in  the
value  of the  hedged investment would  be offset  to the extent  of the premium
received  for  writing  the  option.  However,  if  the  security  or   currency
appreciates to a price higher than the exercise price of the call option, it can
be  expected that  the option will  be exercised  and a Theme  Portfolio will be
obligated to sell the security or currency at less than its market value.

The premium that a Theme Portfolio receives for writing a call option is  deemed
to  constitute the market  value of an  option. The premium  the Theme Portfolio
will receive from writing  a call option will  reflect, among other things,  the
current  market  price of  the underlying  investment,  the relationship  of the
exercise price to  such market  price, the  historical price  volatility of  the
underlying  investment,  and the  length of  the  option period.  In determining
whether a particular call  option should be written,  LGT Asset Management  will
consider the reasonableness of the anticipated premium and the likelihood that a
liquid secondary market will exist for those options.

Closing  transactions  will be  effected  in order  to  realize a  profit  on an
outstanding call  option, to  prevent an  underlying security  or currency  from
being  called, or  to permit  the sale of  the underlying  security or currency.
Furthermore, effecting a closing  transaction will permit  a Theme Portfolio  to
write  another call option on the underlying  security or currency with either a
different exercise price or expiration date, or both.

Each Theme Portfolio will pay transaction  costs in connection with the  writing
of  options and in  entering into closing  purchase contracts. Transaction costs
relating to  options  activity are  normally  higher than  those  applicable  to
purchases and sales of portfolio securities.

The  exercise price of the  options may be below, equal  to or above the current
market values of the underlying securities or currencies at the time the options
are written. From  time to time,  a Theme Portfolio  may purchase an  underlying
security  or currency for delivery in accordance with the exercise of an option,
rather than delivering  such security or  currency from its  portfolio. In  such
cases, additional costs will be incurred.

A  Theme  Portfolio  will realize  a  profit  or loss  from  a  closing purchase
transaction if the cost of the  transaction is less or more, respectively,  than
the  premium received from  writing the option. Because  increases in the market
price of a call option generally will  reflect increases in the market price  of
the underlying security or currency, any loss resulting from the repurchase of a
call  option is likely to be  offset in whole or in  part by appreciation of the
underlying security or currency owned by a Theme Portfolio.

WRITING PUT OPTIONS
Each  Theme  Portfolio  may  write  put  options  on  securities,  indices   and
currencies.  A put option gives  the purchaser of the  option the right to sell,
and the  writer (seller)  the  obligation to  buy,  the underlying  security  or
currency  at  the  exercise price  at  any  time until  (American  style)  or on
(European style) the  expiration date.  The operation  of put  options in  other
respects,  including their related risks and rewards, is substantially identical
to that of call options.

A Theme Portfolio generally would write  put options in circumstances where  LGT
Asset  Management wishes to  purchase the underlying security  or currency for a
Theme Portfolio's holdings at a price lower than the current market price of the
security or currency. In such event, a Theme Portfolio would write a put  option
at  an  exercise price  that, reduced  by  the premium  received on  the option,
reflects the lower price it is willing  to pay. Since the Theme Portfolio  would
also  receive interest on debt securities  or currencies maintained to cover the
exercise price of the  option, this technique could  be used to enhance  current
return  during periods  of market  uncertainty. The  risk in  such a transaction
would be that  the market  price of the  underlying security  or currency  would
decline below the exercise price less the premium received.

                   Statement of Additional Information Page 7
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                             GT GLOBAL THEME FUNDS

Writing  put options can serve as a  limited long hedge because increases in the
value of the  hedged investment would  be offset  to the extent  of the  premium
received   for  writing  the  option.  However,  if  the  security  or  currency
depreciates to a price lower than the  exercise price of the put option, it  can
be  expected that the put option will be exercised and a Theme Portfolio will be
obligated to sell the security or currency at less than its market value.

PURCHASING PUT OPTIONS
Each Theme  Portfolio  may  purchase  put options  on  securities,  indices  and
currencies.  As the  holder of a  put option,  a Theme Portfolio  would have the
right to sell the underlying security or  currency at the exercise price at  any
time  until (American style) or on (European style) the expiration date. A Theme
Portfolio may enter into closing sale transactions with respect to such options,
exercise such option or permit such option to expire.

Each Theme Portfolio  may purchase  a put option  on an  underlying security  or
currency  ("protective put")  owned by the  Theme Portfolio in  order to protect
against an anticipated decline  in the value of  the security or currency.  Such
hedge  protection is provided  only during the  life of the  put option when the
Theme Portfolio, as the holder of the put option, is able to sell the underlying
security or currency at the put exercise price regardless of any decline in  the
underlying  security's market price or currency's exchange value. For example, a
put option may  be purchased in  order to protect  unrealized appreciation of  a
security or currency when LGT Asset Management deems it desirable to continue to
hold  the security or  currency because of tax  considerations. The premium paid
for the put option and any  transaction costs would reduce any profit  otherwise
available for distribution when the security or currency is eventually sold.

A  Theme Portfolio may also purchase put options  at a time when it does not own
the underlying security or currency. By purchasing put options on a security  or
currency  it does not own, that Theme  Portfolio seeks to benefit from a decline
in the market price of the underlying security or currency. If the put option is
not sold when it has remaining value, and if the market price of the  underlying
security  or currency remains equal to or greater than the exercise price during
the life of the put option, the Theme Portfolio will lose its entire  investment
in  the put option. In order for the  purchase of a put option to be profitable,
the  market  price  of  the   underlying  security  or  currency  must   decline
sufficiently  below  the exercise  price to  cover  the premium  and transaction
costs, unless the put option is sold in a closing sale transaction.

PURCHASING CALL OPTIONS
Each Theme  Portfolio  may purchase  call  options on  securities,  indices  and
currencies.  As the holder of a call  option, the Theme Portfolio would have the
right to purchase the underlying security  or currency at the exercise price  at
any  time until (American style)  or on (European style)  the expiration date. A
Theme Portfolio may enter  into closing sale transactions  with respect to  such
options, exercise such options or permit such options to expire.

Call  options may be purchased by a Theme Portfolio for the purpose of acquiring
the underlying security or currency for its portfolio. Utilized in this fashion,
the purchase  of call  options would  enable a  Theme Portfolio  to acquire  the
security  or currency at the exercise price  of the call option plus the premium
paid. At times,  the net  cost of  acquiring the  security or  currency in  this
manner may be less than the cost of acquiring the security or currency directly.
This  technique may also  be useful to  a Theme Portfolio  in purchasing a large
block of securities  that would be  more difficult to  acquire by direct  market
purchases.  So long as it  holds such a call  option, rather than the underlying
security or currency itself, the Theme Portfolio is partially protected from any
unexpected decline in the  market price of the  underlying security or  currency
and, in such event, could allow the call option to expire, incurring a loss only
to the extent of the premium paid for the option.

A  Theme Portfolio  may also purchase  call options on  underlying securities or
currencies it  owns  in  order  to protect  unrealized  gains  on  call  options
previously  written by  it. A  call option could  be purchased  for this purpose
where tax considerations  make it inadvisable  to realize such  gains through  a
closing  purchase transaction.  Call options may  also be purchased  at times to
avoid realizing losses that would result in a reduction of the Theme Portfolio's
current return. For example, where a  Theme Portfolio has written a call  option
on  an underlying security or  currency having a current  market value below the
price at which such security or currency was purchased by that Theme  Portfolio,
an  increase in the market price could result in the exercise of the call option
written by the Theme Portfolio and the  realization of a loss on the  underlying
security  or currency.  Accordingly, the Theme  Portfolio could  purchase a call
option on the same underlying security or currency, which could be exercised  to
fulfill the Theme Portfolio's delivery obligations under its written call (if it
is  exercised). This strategy  could allow the Theme  Portfolio to avoid selling
the portfolio security or  currency at a  time when it  has an unrealized  loss;
however,  the Theme Portfolio would  have to pay a  premium to purchase the call
option plus transaction costs.

Aggregate premiums paid  for put and  call options  will not exceed  5% of  each
Theme Portfolio's total assets at the time of each purchase.

                   Statement of Additional Information Page 8
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                             GT GLOBAL THEME FUNDS

A Theme Portfolio may attempt to accomplish objectives similar to those involved
in  using Forward Contracts, by purchasing put  or call options on currencies. A
put option  gives  the Theme  Portfolio  as purchaser  the  right (but  not  the
obligation)  to sell a specified amount of currency at the exercise price at any
time until (American style)  or (on European style)  the expiration date of  the
option.  A call option gives the Theme Portfolio as purchaser the right (but not
the obligation) to purchase a specified amount of currency at the exercise price
at any time until (American style) or (on European style) the expiration date of
the option. A Theme Portfolio might purchase a currency put option, for example,
to protect itself against a decline in  the dollar value of a currency in  which
it  holds  or anticipates  holding securities.  If  the currency's  value should
decline against the  dollar, the  loss in currency  value should  be offset,  in
whole  or in part, by an  increase in the value of the  put. If the value of the
currency instead should rise against the  dollar, any gain to a Theme  Portfolio
would  be reduced by the premium it had paid for the put option. A currency call
option might  be purchased,  for  example, in  anticipation  of, or  to  protect
against,  a rise in the value against the  dollar of a currency in which a Theme
Portfolio anticipates purchasing securities.

Options may be  either listed on  an exchange or  traded over-the-counter  ("OTC
options").  Listed options are  third-party contracts (I.E.,  performance of the
obligations of  the  purchaser and  seller  is  guaranteed by  the  exchange  or
clearing  corporation) and have standardized strike prices and expiration dates.
OTC options are two-party contracts with negotiated strike prices and expiration
dates. A Theme Portfolio will not purchase an OTC option unless it believes that
daily valuations for  such options  are readily obtainable.  OTC options  differ
from  exchange-traded options  in that OTC  options are  transacted with dealers
directly and not through a clearing corporation (which guarantees  performance).
Consequently,  there  is  a risk  of  non-performance  by the  dealer.  Since no
exchange is involved, OTC options are valued on the basis of a quote provided by
the dealer. In the case of OTC options, there can be no assurance that a  liquid
secondary market will exist for any particular option at any specific time.

The  SEC's staff  considers purchased OTC  options to be  illiquid securities. A
Theme Portfolio  may  also  sell  OTC  options  and,  in  connection  therewith,
segregate assets or cover its obligations with respect to OTC options written by
the Theme Portfolio. The assets used as cover for OTC options written by a Theme
Portfolio  will  be  considered illiquid  unless  the  OTC options  are  sold to
qualified dealers who  agree that  the Theme  Portfolio may  repurchase any  OTC
option  it writes at a maximum price to  be calculated by a formula set forth in
the option  agreement. The  cover for  an  OTC option  written subject  to  this
procedure  would  be considered  illiquid only  to the  extent that  the maximum
repurchase price under the formula exceeds the intrinsic value of the option.

The  Theme  Portfolio's  ability  to  establish  and  close  out  positions   in
exchange-listed  options depends  on the existence  of a liquid  market. A Theme
Portfolio intends to purchase  or write only  those exchange-traded options  for
which  there appears to be  a liquid secondary market.  However, there can be no
assurance that  such  a  market  will exist  at  any  particular  time.  Closing
transactions  can be made for OTC options  only by negotiating directly with the
contra party, or by  a transaction in  the secondary market  if any such  market
exists.  Although a Theme Portfolio will enter into OTC options only with contra
parties that are expected  to be capable of  entering into closing  transactions
with the Theme Portfolio, there is no assurance that the Theme Portfolio will in
fact  be able to close out an OTC  option position at a favorable price prior to
expiration. In the event of insolvency of the contra party, the Theme  Portfolio
might  be unable to  close out an OTC  option position at any  time prior to its
expiration.

INDEX OPTIONS
Puts and calls on indices are similar to puts and calls on securities or futures
contracts except that all settlements  are in cash and  gain or loss depends  on
changes  in the index in question (and thus on price movements in the securities
market or a particular market sector  generally) rather than on price  movements
in  individual securities or futures contracts.  When a Theme Portfolio writes a
call on an index, it receives a premium and agrees that, prior to the expiration
date, the purchaser of the  call, upon exercise of  the call, will receive  from
the  Theme Portfolio an  amount of cash if  the closing level  of the index upon
which the call  is based is  greater than the  exercise price of  the call.  The
amount of cash is equal to the difference between the closing price of the index
and   the  exercise  price   of  the  call  times   a  specified  multiple  (the
"multiplier"), which determines the  total dollar value for  each point of  such
difference.  When a Theme Portfolio  buys a call on an  index, it pays a premium
and has the same  rights as to such  call as are indicated  above. When a  Theme
Portfolio  buys a put on an index, it pays a premium and has the right, prior to
the expiration  date,  to  require  the  seller  of  the  put,  upon  the  Theme
Portfolio's  exercise of the put, to deliver to the Theme Portfolio an amount of
cash if the closing level of the index upon which the put is based is less  than
the  exercise  price of  the  put, which  amount of  cash  is determined  by the
multiplier, as described above for calls. When the Theme Portfolio writes a  put
on an index, it receives a premium and the purchaser has the right, prior to the
expiration  date, to require the  Theme Portfolio to deliver  to it an amount of
cash equal to  the difference between  the closing  level of the  index and  the
exercise  price times  the multiplier,  if the  closing level  is less  than the
exercise price.

                   Statement of Additional Information Page 9
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                             GT GLOBAL THEME FUNDS

The risks  of  investment  in index  options  may  be greater  than  options  on
securities.  Because index options  are settled in cash,  when a Theme Portfolio
writes a  call on  an  index it  cannot provide  in  advance for  its  potential
settlement  obligations by  acquiring and  holding the  underlying securities. A
Theme Portfolio can  offset some  of the  risk of  writing a  call index  option
position  by holding a  diversified portfolio of securities  similar to those on
which the underlying  index is based.  However, a Theme  Portfolio cannot, as  a
practical  matter,  acquire and  hold a  portfolio  containing exactly  the same
securities as underlie the index and, as  a result, bears a risk that the  value
of the securities held will vary from the value of the index.

Even  if a  Theme Portfolio could  assemble a securities  portfolio that exactly
reproduced the composition of the underlying index, it still would not be  fully
covered  from a risk standpoint because of the "timing risk" inherent in writing
index options. When an index  option is exercised, the  amount of cash that  the
holder  is  entitled to  receive  is determined  by  the difference  between the
exercise price  and the  closing index  level on  the date  when the  option  is
exercised.  As with  other kinds  of options,  the Theme  Portfolio as  the call
writer will not know that  it has been assigned until  the next business day  at
the  earliest. The time lag  between exercise and notice  of assignment poses no
risk for the writer of a covered call on a specific underlying security, such as
common stock, because there the writer's obligation is to deliver the underlying
security, not to pay its value  as of a fixed time in  the past. So long as  the
writer  already  owns the  underlying security,  it  can satisfy  its settlement
obligations by  simply delivering  it, and  the  risk that  its value  may  have
declined since the exercise date is borne by the exercising holder. In contrast,
even  if the  writer of an  index call  holds securities that  exactly match the
composition of  the  underlying  index, it  will  not  be able  to  satisfy  its
assignment  obligations by  delivering those  securities against  payment of the
exercise price. Instead, it will be required  to pay cash in an amount based  on
the  closing index value on the exercise date; and by the time it learns that it
has been assigned, the index may have declined, with a corresponding decline  in
the  value  of  its securities  portfolio.  This  "timing risk"  is  an inherent
limitation on the ability of index call writers to cover their risk exposure  by
holding securities positions.

If  a Theme Portfolio has purchased an  index option and exercises it before the
closing index value for that day is  available, it runs the risk that the  level
of  the underlying index  may subsequently change.  If such a  change causes the
exercised option to fall out-of-the-money, the Theme Portfolio will be  required
to  pay the difference between the closing index value and the exercise price of
the option (times the applicable multiplier) to the assigned writer.

INTEREST RATE, CURRENCY AND STOCK INDEX FUTURES CONTRACTS
Each Theme Portfolio may enter into interest rate or currency futures contracts,
and may enter  into stock  index futures contracts  (collectively, "Futures"  or
"Futures  Contracts"),  as  a  hedge against  changes  in  prevailing  levels of
interest rates,  currency exchange  rates  or stock  price  levels in  order  to
establish  more definitely the effective return on securities or currencies held
or intended to be acquired by  the Theme Portfolio. A Theme Portfolio's  hedging
may  include  sales of  Futures  as an  offset  against the  effect  of expected
increases in interest rates, and decreases in currency exchange rates and  stock
prices,  and purchases of  Futures as an  offset against the  effect of expected
declines in interest rates,  and increases in currency  exchange rates or  stock
prices.

Each  Theme Portfolio only will enter into  Futures Contracts that are traded on
futures exchanges  and  are standardized  as  to maturity  date  and  underlying
financial instrument. Futures exchanges and trading thereon in the United States
are  regulated under the Commodity Exchange Act by the Commodity Futures Trading
Commission ("CFTC"). Futures are exchanged in London at the London International
Financial Futures Exchange.

Although techniques other than sales and purchases of Futures Contracts could be
used to reduce a Theme Portfolio's exposure to interest rate, currency  exchange
rate  and stock market fluctuations,  that Theme Portfolio may  be able to hedge
its exposure  more  effectively  and  at a  lower  cost  through  using  Futures
Contracts.

A  Futures Contract provides  for the future  sale by one  party and purchase by
another party of a specified amount of a specific financial instrument (security
or currency) for a specified price at a designated date, time and place. A stock
index Futures Contract provides for the delivery, at a designated date, time and
place, of  an amount  of  cash equal  to a  specified  dollar amount  times  the
difference between the stock index value at the close of trading on the contract
and  the price at which  the Futures Contract is  originally struck; no physical
delivery of stocks  comprising the index  is made. Brokerage  fees are  incurred
when  a  Futures  Contract  is  bought or  sold,  and  margin  deposits  must be
maintained at all times the Futures Contract is outstanding.

Although Futures Contracts typically require future delivery of and payment  for
financial  instruments or currencies,  Futures Contracts usually  are closed out
before the delivery date. Closing out an open Futures Contract sale or  purchase
is  effected by entering  into an offsetting Futures  Contract purchase or sale,
respectively,  for  the  same  aggregate  amount  of  the  identical   financial
instrument  or currency and  the same delivery date.  If the offsetting purchase
price is less than the

                  Statement of Additional Information Page 10
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                             GT GLOBAL THEME FUNDS
original sale price, the  Theme Portfolio realizes  a gain; if  it is more,  the
Theme  Portfolio realizes  a loss. Conversely,  if the offsetting  sale price is
more than the original purchase price,  the Theme Portfolio realizes a gain;  if
it is less, the Theme Portfolio realizes a loss. The transaction costs must also
be  included in these calculations.  There can be no  assurance, however, that a
Theme Portfolio  will be  able  to enter  into  an offsetting  transaction  with
respect  to  a particular  Futures Contract  at  a particular  time. If  a Theme
Portfolio is  not able  to  enter into  an  offsetting transaction,  that  Theme
Portfolio  will continue to be  required to maintain the  margin deposits on the
Futures Contract.

As an example of an offsetting transaction, the contractual obligations  arising
from  the sale of one Futures Contract of September Deutschemarks on an exchange
may be  fulfilled at  any time  before delivery  under the  Futures Contract  is
required  (I.E., on a specified date in  September, the "delivery month") by the
purchase of  another Futures  Contract of  September Deutschemarks  on the  same
exchange.  In  such instance,  the  difference between  the  price at  which the
Futures Contract was sold and the price paid for the offsetting purchase,  after
allowance  for transaction  costs, represents  the profit  or loss  to the Theme
Portfolio.

Each Theme Portfolio's  Futures transactions  will be entered  into for  hedging
purposes;  that is, Futures Contracts will be  sold to protect against a decline
in the price of securities or currencies that a Theme Portfolio owns, or Futures
Contracts will be purchased to protect  the Theme Portfolio against an  increase
in the price of securities or currencies it has committed to purchase or expects
to purchase.

"Margin"  with respect to Futures Contracts is  the amount of funds that must be
deposited by a Theme Portfolio in order to initiate Futures trading and maintain
the Theme Portfolio's open positions in Futures Contracts. A margin deposit made
when the Futures  Contract is  entered into  ("initial margin")  is intended  to
ensure  the Theme Portfolio's performance under the Futures Contract. The margin
required for a particular Futures Contract is  set by the exchange on which  the
Futures  Contract is traded and may be  significantly modified from time to time
by the exchange during the term of the Futures Contract.

Subsequent  payments,  called  "variation  margin,"  to  and  from  the  futures
commission  merchant through which the Theme  Portfolio entered into the Futures
Contract will be made on a daily basis as the price of the underlying  security,
currency  or index fluctuates making the Futures  Contract more or less value, a
process known as marking-to-market.

    RISKS OF  USING  FUTURES CONTRACTS.  The  prices of  Futures  Contracts  are
volatile  and  are influenced  by, among  other  things, actual  and anticipated
changes in  interest rates  and currency  exchange rates,  and in  stock  market
movements,  which  in turn  are  affected by  fiscal  and monetary  policies and
national and international political and economic events.

There is a risk  of imperfect correlation between  changes in prices of  Futures
Contracts  and prices  of the  securities or  currencies in  a Theme Portfolio's
portfolio being hedged. The degree  of imperfection of correlation depends  upon
circumstances  such as variations  in speculative market  demand for Futures and
for securities or currencies, including technical influences in Futures trading;
and  differences  between  the  financial  instruments  being  hedged  and   the
instruments  underlying the standard Futures  Contracts available for trading. A
decision of whether, when and how to hedge involves skill and judgment, and even
a well-conceived hedge may be unsuccessful to some degree because of  unexpected
market behavior or interest or currency rate trends.

Because  of  the  low  margin deposits  required,  Futures  trading  involves an
extremely high  degree  of leverage.  As  a  result, a  relatively  small  price
movement  in a Futures Contract may result in immediate and substantial loss, as
well as gain, to the investor. For example,  if at the time of purchase, 10%  of
the  value of  the Futures  Contract is  deposited as  margin, a  subsequent 10%
decrease in the value of  the Futures Contract would result  in a total loss  of
the  margin  deposit, before  any deduction  for the  transaction costs,  if the
account were then closed  out. A 15%  decrease would result in  a loss equal  to
150%  of the original margin  deposit, if the Futures  Contract were closed out.
Thus, a purchase or sale of a Futures Contract may result in losses in excess of
the amount invested in the Futures Contract.

Most U.S. Futures exchanges limit the amount of fluctuation permitted in Futures
Contract and options on  Futures Contracts prices during  a single trading  day.
The  daily limit  establishes the  maximum amount  that the  price of  a Futures
Contract or option may vary either up or down from the previous day's settlement
price at the end of a trading session. Once the daily limit has been reached  in
a  particular type of Futures Contract or option,  no trades may be made on that
day at a price beyond  that limit. The daily  limit governs only price  movement
during  a particular trading day and  therefore does not limit potential losses,
because the limit may prevent the liquidation of unfavorable positions.  Futures
Contract  and  option prices  have  occasionally moved  to  the daily  limit for
several consecutive trading days with  little or no trading, thereby  preventing
prompt  liquidation  of positions  and  subjecting some  traders  to substantial
losses.

                  Statement of Additional Information Page 11
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                             GT GLOBAL THEME FUNDS

If a Theme Portfolio  were unable to  liquidate a Futures  or option on  Futures
position  due to the absence  of a liquid secondary  market or the imposition of
price limits,  it could  incur  substantial losses.  The Theme  Portfolio  would
continue to be subject to market risk with respect to the position. In addition,
except  in the case of purchased options,  the Theme Portfolio would continue to
be required to  make daily variation  margin payments and  might be required  to
maintain  the position being hedged by the  Future or option or to maintain cash
or securities in a segregated account.

Certain characteristics  of the  Futures  market might  increase the  risk  that
movements  in the prices  of Futures Contracts  or options on  Futures might not
correlate perfectly  with  movements in  the  prices of  the  investments  being
hedged.  For example,  all participants  in the  Futures and  options on Futures
markets are subject to  daily variation margin calls  and might be compelled  to
liquidate  Futures  or  options on  Futures  positions whose  prices  are moving
unfavorably to avoid being  subject to further  calls. These liquidations  could
increase  price  volatility  of the  instruments  and distort  the  normal price
relationship between the Futures  or options and  the investments being  hedged.
Also, because initial margin deposit requirements in the Futures market are less
onerous  than  margin requirements  in the  securities  markets, there  might be
increased  participation   by  speculators   in   the  Futures   markets.   This
participation  also  might  cause  temporary  price  distortions.  In  addition,
activities of large traders in both the Futures and securities markets involving
arbitrage, "program trading"  and other  investment strategies  might result  in
temporary price distortions.

OPTIONS ON FUTURES CONTRACTS
Options  on Futures Contracts are similar to options on securities or currencies
except that options on Futures Contracts give the purchaser the right, in return
for the  premium paid,  to  assume a  position in  a  Futures Contract  (a  long
position if the option is a call and a short position if the option is a put) at
a  specified exercise price  at any time  during the period  of the option. Upon
exercise of the option, the  delivery of the Futures  position by the writer  of
the  option to the holder  of the option will be  accompanied by delivery of the
accumulated balance in the writer's Futures margin account, which represents the
amount by which the market price  of the Futures Contract, at exercise,  exceeds
(in  the case of  a call) or  is less than (in  the case of  a put) the exercise
price of the option on  the Futures Contract. If an  option is exercised on  the
last trading day prior to the expiration date of the option, the settlement will
be  made entirely in cash equal to  the difference between the exercise price of
the option and  the closing level  of the securities,  currencies or index  upon
which  the  Futures Contract  is  based on  the  expiration date.  Purchasers of
options who fail to exercise their options  prior to the exercise date suffer  a
loss of the premium paid.

The  purchase of  call options  on Futures can  serve as  a long  hedge, and the
purchase of put  options on Futures  can serve  as a short  hedge. Writing  call
options  on Futures can serve as a  limited short hedge, and writing put options
on Futures can serve as a limited  long hedge, using a strategy similar to  that
used for writing options on securities, foreign currencies or indices.

If a Theme Portfolio writes an option on a Futures Contract, it will be required
to  deposit initial  and variation  margin pursuant  to requirements  similar to
those applicable to Futures Contracts. Premiums received from the writing of  an
option on a Futures Contract are included in the initial margin deposit.

A  Theme Portfolio may seek to close out an option position by selling an option
covering the  same Futures  Contract  and having  the  same exercise  price  and
expiration  date.  The ability  to  establish and  close  out positions  on such
options is subject to the maintenance of a liquid secondary market.

LIMITATION ON  USE  OF  FUTURES,  OPTIONS ON  FUTURES  AND  CERTAIN  OPTIONS  ON
CURRENCIES
To  the extent that a Theme Portfolio  enters into Futures Contracts, options on
Futures Contracts, and options on foreign currencies traded on a  CFTC-regulated
exchange,  in each case other than for BONA FIDE hedging purposes (as defined by
the CFTC), the aggregate initial margin and premiums required to establish those
positions (excluding the amount  by which options  are "in-the-money") will  not
exceed  5% of the  liquidation value of  the Theme Portfolio,  after taking into
account unrealized  profits and  unrealized losses  on any  contracts the  Theme
Portfolio  has entered into. In general, a  call option on a Futures Contract is
"in-the-money" if  the value  of  the underlying  Futures Contract  exceeds  the
strike, I.E., exercise, price of the call; a put option on a Futures Contract is
"in-the-money"  if the value  of the underlying Futures  Contract is exceeded by
the strike price of  the put. This  guideline may be  modified by the  Company's
Board  of Directors without  a shareholder vote. This  limitation does not limit
the percentage of a Theme Portfolio's assets at risk to 5%.

FORWARD CURRENCY CONTRACTS
A Forward Contract is an obligation, usually arranged with a commercial bank  or
other  currency dealer, to purchase or  sell a currency against another currency
at a future  date and price  as agreed upon  by the parties.  A Theme  Portfolio
either  may  accept or  make delivery  of the  currency at  the maturity  of the
Forward Contract. A Theme Portfolio may  also, if its contra party agrees  prior
to  maturity, enter into a closing transaction involving the purchase or sale of
an offsetting contract.

                  Statement of Additional Information Page 12
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A Theme Portfolio engages in  forward currency transactions in anticipation  of,
or  to protect itself against, fluctuations in exchange rates. A Theme Portfolio
might sell a  particular foreign currency  forward, for example,  when it  holds
bonds  denominated  in  a foreign  currency  but  anticipates, and  seeks  to be
protected against, a decline in the currency against the U.S. dollar. Similarly,
a Theme  Portfolio  might sell  the  U.S. dollar  forward  when it  holds  bonds
denominated  in U.S. dollars but anticipates, and seeks to be protected against,
a decline in  the U.S.  dollar relative to  other currencies.  Further, a  Theme
Portfolio might purchase a currency forward to "lock in" the price of securities
denominated in that currency that it anticipates purchasing.

Forward  Contracts are traded in the interbank market conducted directly between
currency traders (usually large commercial banks) and their customers. A Forward
Contract generally has no deposit requirement, and no commissions are charged at
any stage  for  trades.  Each  Theme Portfolio  will  enter  into  such  Forward
Contracts with major U.S. or foreign banks and securities or currency dealers in
accordance  with guidelines approved by the  Theme Portfolios' Board of Trustees
or the Company's Board of Directors, as applicable.

A Theme  Portfolio may  enter  into Forward  Contracts  either with  respect  to
specific  transactions  or with  respect to  overall  investments of  that Theme
Portfolio. The precise matching of the Forward Contract amounts and the value of
specific securities generally will not be  possible because the future value  of
such  securities in  foreign currencies will  change as a  consequence of market
movements in the value of those securities between the date the Forward Contract
is entered into and the  date it matures. Accordingly,  it may be necessary  for
that    Theme    Portfolio    to    purchase    additional    foreign   currency
on the spot (I.E., cash) market (and  bear the expense of such purchase) if  the
market  value of the  security is less  than the amount  of foreign currency the
Theme Portfolio is obligated to  deliver and if a decision  is made to sell  the
security  and  make delivery  of  the foreign  currency.  Conversely, it  may be
necessary to sell  on the spot  market some  of the foreign  currency the  Theme
Portfolio  is obligated to deliver. The projection of short-term currency market
movements is extremely difficult, and  the successful execution of a  short-term
hedging  strategy is highly  uncertain. Forward Contracts  involve the risk that
anticipated currency movements will not be predicted accurately, causing a Theme
Portfolio to sustain losses on these contracts and transaction costs.

At or before the maturity of a  Forward Contract requiring a Theme Portfolio  to
sell  a currency, that  Theme Portfolio either  may sell a  security and use the
sale proceeds to make delivery of the currency or retain the security and offset
its contractual  obligation  to deliver  the  currency by  purchasing  a  second
contract pursuant to which the Theme Portfolio will obtain, on the same maturity
date,  the  same  amount  of  the currency  that  it  is  obligated  to deliver.
Similarly, a Theme Portfolio  may close out a  Forward Contract requiring it  to
purchase  a specified currency by,  if its contra party  agrees, entering into a
second contract entitling it to sell the same amount of the same currency on the
maturity date of the first contract. A  Theme Portfolio would realize a gain  or
loss  as a  result of  entering into such  an offsetting  Forward Contract under
either circumstance  to  the extent  the  exchange  rate or  rates  between  the
currencies  involved moved between the execution dates of the first contract and
the offsetting contract.

The cost  to a  Theme Portfolio  of engaging  in Forward  Contracts varies  with
factors  such as the currencies involved, the  length of the contract period and
the market conditions  then prevailing.  Because Forward  Contracts are  usually
entered  into on a principal basis, no fees or commissions are involved. The use
of Forward  Contracts does  not  eliminate fluctuations  in  the prices  of  the
underlying  securities a Theme Portfolio owns or intends to acquire, but it does
establish a rate  of exchange in  advance. In addition,  while Forward  Contract
sales  limit  the risk  of loss  due to  a decline  in the  value of  the hedged
currencies, they also  limit any  potential gain  that might  result should  the
value of the currencies increase.

FOREIGN CURRENCY STRATEGIES -- SPECIAL CONSIDERATIONS
A  Theme Portfolio  may use  options on  foreign currencies,  Futures on foreign
currencies, options on Futures  on foreign currencies  and Forward Contracts  to
hedge  against movements in  the values of  the foreign currencies  in which the
Theme Portfolio's securities are denominated.  Such currency hedges can  protect
against  price movements in a security that  the Theme Portfolio owns or intends
to acquire that  are attributable to  changes in  the value of  the currency  in
which  it is  denominated. Such  hedges do  not, however,  protect against price
movements in the securities that are attributable to other causes.

A Theme  Portfolio  might seek  to  hedge against  changes  in the  value  of  a
particular  currency  when  no  Futures  Contract,  Forward  Contract  or option
involving that currency is available or one of such contracts is more  expensive
than  certain  other contracts.  In such  cases, the  Theme Portfolio  may hedge
against price movements in that currency by entering into a contract on  another
currency  or  basket of  currencies, the  values of  which LGT  Asset Management
believes will have  a positive correlation  to the value  of the currency  being
hedged.  The risk that movements in the price of the contract will not correlate
perfectly with movements in the price of the currency being hedged is  magnified
when this strategy is used.

                  Statement of Additional Information Page 13
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                             GT GLOBAL THEME FUNDS

The  value of Futures Contracts, options on Futures Contracts, Forward Contracts
and options  on  foreign currencies  depends  on  the value  of  the  underlying
currency  relative  to the  U.S. dollar.  Because foreign  currency transactions
occurring in the  interbank market  might involve  substantially larger  amounts
than  those  involved in  the  use of  Futures  Contracts, Forward  Contracts or
options, the Theme Portfolio  could be disadvantaged by  dealing in the odd  lot
market  (generally consisting of  transactions of less than  $1 million) for the
underlying foreign currencies at prices that  are less favorable than for  round
lots.

There is no systematic reporting of last sale information for foreign currencies
or  any  regulatory requirements  that quotations  available through  dealers or
other market sources be firm or revised on a timely basis. Quotation information
generally is representative of very  large transactions in the interbank  market
and  thus  might not  reflect  odd-lot transactions  where  rates might  be less
favorable.  The   interbank  market   in  foreign   currencies  is   a   global,
round-the-clock  market. To the  extent the U.S. options  or Futures markets are
closed while the markets for the underlying currencies remain open,  significant
price  and rate movements might take place in the underlying markets that cannot
be reflected in  the markets  for the Futures  contracts or  options until  they
reopen.

Settlement of Futures Contracts, Forward Contracts and options involving foreign
currencies  might  be required  to  take place  within  the country  issuing the
underlying currency. Thus, the  Theme Portfolio might be  required to accept  or
make  delivery of the underlying foreign currency in accordance with any U.S. or
foreign regulations regarding the maintenance of foreign banking arrangements by
U.S. residents  and  might  be required  to  pay  any fees,  taxes  and  charges
associated with such delivery assessed in the issuing country.

COVER
Transactions  using Forward Contracts, Futures Contracts and options (other than
options that a Theme Portfolio has  purchased) expose the Theme Portfolio to  an
obligation  to another  party. A  Theme Portfolio will  not enter  into any such
transactions unless it  owns either  (1) an offsetting  ("covered") position  in
securities,   currencies,  or  other  options,   Forward  Contracts  or  Futures
Contracts, or (2) cash, receivables and short-term debt securities with a  value
sufficient  at  all times  to  cover its  potential  obligations not  covered as
provided in (1)  above. Each  Theme Portfolio  will comply  with SEC  guidelines
regarding  cover for  these instruments and,  if the guidelines  so require, set
aside  cash,  U.S.  government  securities  or  other  liquid,  high-grade  debt
securities in a segregated account with its custodian in the prescribed amount.

Assets  used as cover or  held in a segregated account  cannot be sold while the
position in the corresponding  Forward Contract, Futures  Contract or option  is
open, unless they are replaced with other appropriate assets. If a large portion
of  a Theme  Portfolio's assets  are used for  cover or  segregated accounts, it
could affect  portfolio management  or  the Theme  Portfolio's ability  to  meet
redemption requests or other current obligations.

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

                                  RISK FACTORS

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

    CONCENTRATION.  Each  Theme Portfolio  concentrates  its investments  in the
securities of companies in the industries of its particular sector. As a result,
factors specifically affecting those industries, such as substantial  government
regulation,  interest  rate movements,  and  increased competition,  may  have a
greater affect on the value of that Theme Portfolio's shares than on those of an
investment company that does not concentrate its investments in such industries.
In addition,  as  a  result of  each  Theme  Portfolio's ability  to  invest  in
companies in its sector industries throughout the world, each Theme Portfolio is
subject  to  risks relating  to the  different  and rapidly  evolving regulatory
environments for companies in foreign markets.

    ILLIQUID SECURITIES. Each Theme  Portfolio may invest up  to 15% of its  net
assets (except for the Health Care Fund, which may invest up to 10% of its total
assets) in illiquid securities. Securities may be considered illiquid if a Theme
Portfolio  cannot reasonably expect within seven days to sell the securities for
approximately the amount at which  that Theme Portfolio values such  securities.
See  "Investment Limitations." The  sale of illiquid securities,  if they can be
sold at all,  generally will require  more time and  result in higher  brokerage
charges  or dealer discounts  and other selling  expenses than will  the sale of
liquid securities such  as securities  eligible for trading  on U.S.  securities
exchanges  or  in OTC  markets. Moreover,  restricted  securities, which  may be
illiquid for purposes  of this limitation,  often sell,  if at all,  at a  price
lower than similar securities that are not subject to restrictions on resale.

                  Statement of Additional Information Page 14
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                             GT GLOBAL THEME FUNDS

With  respect to  liquidity determinations  generally, the  Portfolios' Board of
Trustees or the Company's  Board of Directors, as  applicable, has the  ultimate
responsibility for determining whether specific securities, including restricted
securities pursuant to Rule 144A under the Securities Act of 1933, are liquid or
illiquid.   Each  Board  has   delegated  the  function   of  making  day-to-day
determinations  of  liquidity  to  LGT  Asset  Management,  in  accordance  with
procedures  approved by  that Board. LGT  Asset Management takes  into account a
number of factors in  reaching liquidity decisions,  including, but not  limited
to,  (i) the frequency  of trading in  the security; (ii)  the number of dealers
that make  quotes  for the  security;  (iii) the  number  of dealers  that  have
undertaken  to make a market in the security; (iv) the number of other potential
purchasers; and  (v) the  nature of  the security  and how  trading is  effected
(e.g.,  the time needed to  sell the security, how  offers are solicited and the
mechanics  of  transfer).  LGT  Asset  Management  monitors  the  liquidity   of
securities   held  by  each  Theme   Portfolio  and  periodically  reports  such
determinations to the Portfolios'  Board of Trustees or  the Company's Board  of
Directors, as applicable.

    POLITICAL,  SOCIAL AND ECONOMIC  RISKS. Investing in  securities of non-U.S.
companies may entail additional risks due to the potential political, social and
economic instability  of  certain  countries and  the  risks  of  expropriation,
nationalization,  confiscation  or  the imposition  of  restrictions  on foreign
investment convertibility of currencies into U.S. dollars and on repatriation of
capital invested. In the event  of such expropriation, nationalization or  other
confiscation  by any country, a Theme Portfolio could lose its entire investment
in any such country.

    RELIGIOUS, POLITICAL AND  ETHNIC INSTABILITY. Certain  countries in which  a
Theme  Portfolio may invest  may have groups that  advocate radical religious or
revolutionary philosophies or  support ethnic independence.  Any disturbance  on
the   part  of  such  individuals  could  carry  the  potential  for  widespread
destruction or  confiscation  of  property owned  by  individuals  and  entities
foreign  to  such  country and  could  cause  the loss  of  a  Theme Portfolio's
investment in those  countries. Instability  may also result  from, among  other
things:  (i) authoritarian governments or  military involvement in political and
economic   decision-making,    including   changes    in   government    through
extra-constitutional  means;  (ii) popular  unrest  associated with  demands for
improved political, economic and social conditions; and (iii) hostile  relations
with  neighboring  or  other  countries.  Such  political,  social  and economic
instability could  disrupt the  principal  financial markets  in which  a  Theme
Portfolio invests and adversely affect the value of a Theme Portfolio's assets.

    FOREIGN  INVESTMENT  RESTRICTIONS.  Certain  countries  prohibit  or  impose
substantial restrictions on investments  in their capital markets,  particularly
their  equity  markets, by  foreign entities  such as  a Theme  Portfolio. These
restrictions or controls may at times  limit or preclude investments in  certain
securities  and may  increase the  cost and expenses  of a  Theme Portfolio. For
example,  certain   countries  require   prior  governmental   approval   before
investments  by  foreign  persons  may  be made,  or  may  limit  the  amount of
investment by foreign persons in a particular company or limit the investment by
foreign persons to only  a specific class  of securities of  a company that  may
have  less  advantageous  terms than  securities  of the  company  available for
purchase by nationals. Moreover, the national policies of certain countries  may
restrict  investment opportunities in issuers  or industries deemed sensitive to
national interests. In  addition, some countries  require governmental  approval
for the repatriation of investment income, capital or the proceeds of securities
sales  by  foreign investors.  In addition,  if  there is  a deterioration  in a
country's balance  of  payments or  for  other  reasons, a  country  may  impose
restrictions  on foreign capital remittances abroad.  A Theme Portfolio could be
adversely  affected  by  delays  in,  or  a  refusal  to  grant,  any   required
governmental  approval for repatriation, as well as  by the application to it of
other restrictions on investments.

    NON-UNIFORM CORPORATE DISCLOSURE STANDARDS AND GOVERNMENTAL
REGULATION. Foreign companies are subject to accounting, auditing and  financial
standards  and requirements that differ, in some cases significantly, from those
applicable to U.S. companies. In particular, the assets, liabilities and profits
appearing on the  financial statements  of such a  company may  not reflect  its
financial  position or results of operations in  the way they would be reflected
had such financial statements  been prepared in  accordance with U.S.  generally
accepted accounting principles. Most of the securities held by a Theme Portfolio
will  not be registered with  the SEC or regulators  of any foreign country, nor
will the issuers thereof be subject  to the SEC's reporting requirements.  Thus,
there  will be  less available  information concerning  most foreign  issuers of
securities held by a Theme Portfolio than is available concerning U.S.  issuers.
In  instances where  the financial  statements of  an issuer  are not  deemed to
reflect accurately the financial situation  of the issuer, LGT Asset  Management
will  take  appropriate steps  to evaluate  the  proposed investment,  which may
include on-site inspection  of the  issuer, interviews with  its management  and
consultations   with  accountants,  bankers  and  other  specialists.  There  is
substantially less publicly available  information about foreign companies  than
there  are  reports and  ratings  published about  U.S.  companies and  the U.S.
government. In addition, where public information  is available, it may be  less
reliable  than such information regarding U.S. issuers. Issuers of securities in
foreign jurisdictions are generally not subject to the same degree of regulation
as are  U.S. issuers  with respect  to such  matters as  restrictions on  market
manipulation,  insider trading rules, shareholder  proxy requirements and timely
disclosure of information.

                  Statement of Additional Information Page 15
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                             GT GLOBAL THEME FUNDS

    CURRENCY  FLUCTUATIONS.   Because  each   Theme  Portfolio,   under   normal
circumstances,  will invest  a substantial  portion of  its total  assets in the
securities of foreign issuers which  are denominated in foreign currencies,  the
strength  or weakness  of the U.S.  dollar against such  foreign currencies will
account for part of a Theme Portfolio's investment performance. A decline in the
value of any particular currency against the U.S. dollar will cause a decline in
the U.S. dollar value of that Theme Portfolio's holdings of securities and  cash
denominated  in such currency  and, therefore, will cause  an overall decline in
the appropriate Fund's net asset value and any net investment income and capital
gains derived  from  such  securities  to be  distributed  in  U.S.  dollars  to
shareholders  of that Fund. Moreover, if the  value of the foreign currencies in
which a Theme Portfolio  receives its income falls  relative to the U.S.  dollar
between  receipt of the income and  the making of Theme Portfolio distributions,
the Theme Portfolio  may be required  to liquidate securities  in order to  make
distributions  if the Theme  Portfolio has insufficient cash  in U.S. dollars to
meet distribution requirements.

The rate of exchange between the U.S. dollar and other currencies is  determined
by  several factors, including the supply  and demand for particular currencies,
central bank efforts to support particular currencies, the relative movement  of
interest  rates, and pace  of business activity  in the other  countries and the
United States, and other economic  and financial conditions affecting the  world
economy.

Although  each Theme Portfolio values its assets daily in terms of U.S. dollars,
the Portfolios do  not intend to  convert their holdings  of foreign  currencies
into  U.S. dollars  on a daily  basis. Each Portfolio  will do so,  from time to
time, and  investors  should be  aware  of  the costs  of  currency  conversion.
Although  foreign exchange dealers do  not charge a fee  for conversion, they do
realize a profit based on the difference ("spread") between the prices at  which
they buy and sell various currencies. Thus, a dealer may offer to sell a foreign
currency  to a Portfolio at  one rate, while offering  a lesser rate of exchange
should a Portfolio desire to sell that currency to the dealer.

    ADVERSE MARKET CHARACTERISTICS.  Securities of many  foreign issuers may  be
less  liquid and their  prices more volatile than  securities of comparable U.S.
issuers. In  addition,  foreign securities  markets  and brokers  generally  are
subject  to  less governmental  supervision and  regulation  than in  the United
States, and  foreign  securities  transactions  usually  are  subject  to  fixed
commissions,  which  generally are  higher than  negotiated commissions  on U.S.
transactions. In addition,  foreign securities  transactions may  be subject  to
difficulties  associated  with the  settlement of  such transactions.  Delays in
settlement could result in temporary periods when assets of the Theme  Portfolio
are  uninvested  and no  return  is earned  thereon.  The inability  of  a Theme
Portfolio to make intended security  purchases due to settlement problems  could
cause   that  Theme  Portfolio  to  miss  attractive  investment  opportunities.
Inability to dispose of a portfolio  security due to settlement problems  either
could  result in losses  to that Theme  Portfolio due to  subsequent declines in
value of the portfolio security or, if  that Theme Portfolio has entered into  a
contract  to  sell  the security,  could  result  in possible  liability  to the
purchaser. LGT Asset Management will consider such difficulties when determining
the allocation of a Theme Portfolio's assets, although LGT Asset Management does
not believe that  such difficulties  will have a  material adverse  effect on  a
Theme Portfolio's portfolio trading activities.

Each  Theme Portfolio  may use  foreign custodians,  which may  involve risks in
addition to those  related to  its use of  U.S. custodians.  Such risks  include
uncertainties  relating to  determining and  monitoring the  foreign custodian's
financial strength, reputation and standing; maintaining appropriate  safeguards
concerning  that  Theme Portfolio's  investments;  and possible  difficulties in
obtaining and enforcing judgments against such custodians.

    WITHHOLDING TAXES. Each Theme Portfolio's net investment income from foreign
issuers may be  subject to withholding  taxes by the  foreign issuer's  country,
thereby  reducing that Theme  Portfolio's net investment  income or delaying the
receipt of income where those taxes may be recaptured. See "Taxes."

    SPECIAL CONSIDERATIONS AFFECTING EUROPE. The  countries that are members  of
the  European Economic  Community ("Common  Market") (Belgium,  Denmark, France,
Greece, Ireland,  Italy, Luxembourg,  Netherlands, Portugal,  Spain, the  United
Kingdom  and Germany)  eliminated certain  import tariffs  and quotas  and other
trade barriers with  respect to  one another over  the past  several years.  LGT
Asset  Management believes that  this deregulation should  improve the prospects
for economic  growth  in  many  European  countries.  Among  other  things,  the
deregulation could enable companies domiciled in one country to avail themselves
of lower labor costs existing in other countries. In addition, this deregulation
could  benefit companies domiciled in one  country by opening additional markets
for their goods and services in other countries. Since, however, it is not clear
at this time what the exact form  or effect of these Common Market reforms  will
be  on  business in  Western  Europe or  the  emerging European  markets,  it is
impossible to  predict  the long-term  impact  of the  implementation  of  these
programs on the securities owned by a Theme Portfolio.

    SPECIAL  CONSIDERATIONS AFFECTING JAPAN AND  HONG KONG. The concentration of
investments by a Theme Portfolio in Japan  means that the Portfolio may be  more
volatile  than a fund that is broadly diversified geographically. Overseas trade
is

                  Statement of Additional Information Page 16
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                             GT GLOBAL THEME FUNDS
important to Japan's economy. Japan has few natural resources and must export to
pay for its imports of these basic requirements. Because of the concentration of
Japanese exports in highly visible  products, Japan has had difficult  relations
with  its  trading partners,  particularly the  United  States, where  the trade
imbalance is  the  greatest.  It  is possible  that  trade  sanctions  or  other
protectionist  measures could impact  Japan adversely in both  the short and the
long term. The Japanese securities markets are less regulated than those in  the
United  States. Evidence has emerged  from time to time  of distortion of market
prices to serve political or other purposes. Shareholders' rights are not always
equally enforced.

Hong Kong is  a British colony  which will transfer  sovereignty to the  Peoples
Republic  of China  in 1997.  China has  espoused policies  antagonistic to free
enterprise, capitalism and democracy.  There can be  no guarantee that  property
rights  will  continue  to be  safeguarded  in  Hong Kong  after  1997, although
recently China  has moved  toward  free enterprise,  and has  established  stock
exchanges of its own.

    SPECIAL   CONSIDERATIONS  AFFECTING  EMERGING   MARKETS.  Investing  in  the
securities of  companies in  emerging markets,  including the  markets of  Latin
America  and certain Asian  markets such as Taiwan,  Malaysia and Indonesia, may
entail  special  risks  relating  to   the  potential  political  and   economic
instability and the risks of expropriation, nationalization, confiscation or the
imposition  of  restrictions  on foreign  investment,  convertibility  into U.S.
dollars  and  on  repatriation  of  capital  invested.  In  the  event  of  such
expropriation,  nationalization or  other confiscation  by any  country, a Theme
Portfolio could lose its entire investment in any such country.

Emerging securities  markets are  substantially  smaller, less  developed,  less
liquid  and more volatile than the major securities markets. The limited size of
emerging securities markets and limited trading value in issuers compared to the
volume of  trading in  U.S. securities  could  cause prices  to be  erratic  for
reasons  apart  from factors  that  affect the  quality  of the  securities. For
example, limited market size may cause prices to be unduly influenced by traders
who control  large  positions.  Adviser publicity  and  investors'  perceptions,
whether  or  not  based on  fundamental  analysis,  may decrease  the  value and
liquidity of portfolio  securities, especially  in these  markets. In  addition,
securities traded in certain emerging markets may be subject to risks due to the
inexperience  of financial intermediaries, a lack of modern technology, the lack
of a sufficient capital base to expand business operations, and the  possibility
of permanent or temporary termination of trading.

Settlement  mechanisms in emerging securities markets  may be less efficient and
reliable than in more developed markets.  In such emerging securities there  may
be share registration and delivery delays or failures.

Most  Latin American countries have experienced substantial, and in some periods
extremely  high,  rates  of  inflation  for  many  years.  Inflation  and  rapid
fluctuations in inflation rates and corresponding currency devaluations have had
and  may  continue to  have  negative effects  on  the economies  and securities
markets of certain Latin American countries.

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

                             INVESTMENT LIMITATIONS

- --------------------------------------------------------------------------------
FEEDER FUNDS

The Financial Services  Fund, Infrastructure  Fund, Natural  Resources Fund  and
Consumer   Products  and  Services  Fund  each  has  the  following  fundamental
investment policy to enable  it to invest in  the Financial Services  Portfolio,
Infrastructure  Portfolio, Natural Resources Portfolio and Consumer Products and
Services Portfolio respectively:

Notwithstanding any other investment policy of the Fund, the Fund may invest all
of  its  investable  assets  (cash,   securities  and  receivables  related   to
securities)  in an  open-end management investment  company having substantially
the same investment objective, policies and limitations as the Fund.

All other fundamental investment policies, and the non-fundamental policies,  of
each  Feeder  Fund and  its  corresponding Portfolio  are  identical. Therefore,
although the following discusses the  investment policies of each Portfolio  and
its Board of Trustees, it applies equally to each Feeder Fund and their Board of
Directors.

Each  Portfolio has adopted the  following investment limitations as fundamental
policies which (unless otherwise noted) may  not be changed without approval  by
the holders of the lesser of (i) 67% of that Portfolio's shares represented at a

                  Statement of Additional Information Page 17
<PAGE>
                             GT GLOBAL THEME FUNDS
meeting  at which more  than 50% of  the outstanding shares  are represented, or
(ii) more  than  50%  of the  outstanding  shares.  Whenever a  Feeder  Fund  is
requested to vote on a change in the investment limitations of its corresponding
Portfolio,  such Fund will hold a meeting  of its shareholders and will cast its
votes as instructed by its shareholders.

Each Portfolio may not:

        (1)  Buy   or  sell   real  estate   (including  real   estate   limited
    partnerships); however, each Portfolio may invest in debt securities secured
    by  real estate or interests therein or  issued by companies which invest in
    real estate or interests therein, including real estate investment trusts;

        (2) Buy or  sell commodities  or commodity contracts,  except that  each
    Portfolio may purchase and sell financial and currency futures contracts and
    options  thereon,  and may  purchase  and sell  currency  forward contracts,
    options on foreign currencies and may otherwise engage in other transactions
    in foreign currencies;

        (3) Underwrite securities of  other issuers, except  to the extent  that
    the  disposition of  an investment position  may technically cause  it to be
    considered an underwriter as that term  is defined under the Securities  Act
    of 1933;

        (4)  Make loans, except that each Portfolio may purchase debt securities
    and enter  into  repurchase  agreements  and may  make  loans  of  portfolio
    securities;

        (5)  Purchase  securities on  margin, provided  that each  Portfolio may
    obtain such short-term  credits as  may be  necessary for  the clearance  of
    purchases  and sales of securities; except  that it may make margin deposits
    in connection with futures contracts;

        (6) Borrow money except from banks not in excess of 33 1/3% of the value
    of each Portfolio's total assets, (including the amount borrowed), less  all
    liabilities  and indebtedness  (other than the  borrowing). This restriction
    shall not  prevent  any  Portfolio from  entering  into  reverse  repurchase
    agreements,  provided  that  reverse repurchase  agreements,  and  any other
    transactions constituting borrowing by a Portfolio may not exceed  one-third
    of  that Portfolio's  total assets. Transactions  involving options, futures
    contracts, options on futures contracts  and forward currency contracts,  as
    described  in the  Prospectus and  Statement of  Additional Information, and
    collateral  arrangements  relating  thereto  will   not  be  deemed  to   be
    borrowings;

        (7)  Mortgage, pledge, or  hypothecate any of  its assets, provided that
    this restriction shall not apply to the transfer of securities in connection
    with any permissible borrowing or  to collateral arrangements in  connection
    with permissible activities; or

        (8)  Invest in direct interests or leases  in oil, gas, or other mineral
    exploration or development programs; however,  each Portfolio may invest  in
    the securities of companies that engage in these activities.

In  addition, each  Portfolio has adopted  as a fundamental  investment policy a
classification as a "diversified" portfolio under the 1940 Act. This means that,
with respect to 75%  of the Portfolio's  total assets, no more  than 5% will  be
invested in the securities of any one issuer, and the Portfolio will purchase no
more  than 10%  of the  outstanding voting  securities of  any one  issuer. This
policy cannot be changed without  approval by the holders  of a majority of  the
Portfolio's   outstanding  voting  securities  as   defined  above  and  in  the
Prospectus.

The following investment policies of each Portfolio are not fundamental policies
and may  be  changed  by vote  of  the  Portfolios' Board  of  Trustees  without
shareholder approval. No Portfolio may:

        (1)  Invest in securities of an issuer if the investment would cause the
    Portfolio to own more than 10% of any class of securities of any one issuer;

        (2) Invest  in  companies  for  the purpose  of  exercising  control  or
    management;

        (3)  Invest  more than  15% of  its net  assets in  illiquid securities,
    including securities that are illiquid by virtue of the absence of a readily
    available market;

        (4) Invest more than 5% of  its total assets in securities of  companies
    having,  together with their predecessors, a record of less than three years
    of continuous operation;

        (5) Purchase or retain the securities of any issuer, if those individual
    officers and Trustees of the Portfolio, the Portfolio's investment  adviser,
    or  distributor,  each  owning  beneficially  more than  1/2  of  1%  of the
    securities of such issuer,  together own more than  5% of the securities  of
    such issuer;

                  Statement of Additional Information Page 18
<PAGE>
                             GT GLOBAL THEME FUNDS

        (6)  Enter into a futures contract, an  option on a futures contract, or
    an option on foreign currency traded  on a CFTC-regulated exchange, in  each
    case  other than for BONA FIDE hedging purposes (as defined by the CFTC), if
    the aggregate initial margin and premiums required to establish all of those
    positions (excluding the amount by which options are "in-the-money") exceeds
    5% of the liquidation value of the Portfolio's portfolio, after taking  into
    account  unrealized  profits  and  unrealized losses  on  any  contracts the
    Portfolio has entered into;

        (7) Borrow money  except for  temporary or emergency  purposes (not  for
    leveraging)  in excess  of 33  1/3% of  the value  of the  Portfolio's total
    assets (while borrowings  exceed 5%  of the  Infrastructure Portfolio's  and
    Natural Resources Portfolio's total assets, such Portfolio will not make any
    additional investments); and

        (8)  Invest  more  than 10%  of  its  total assets  in  shares  of other
    investment companies and may not invest more than 5% of its total assets  in
    any one investment company or acquire more than 3% of the outstanding voting
    securities of any one investment company.

Investors should refer to the Prospectus for further information with respect to
the  investment objective of each Feeder Fund,  which may not be changed without
the approval of Fund shareholders, and its corresponding Portfolios'  investment
objective,  which may be  changed without the approval  of its shareholders, and
other investment policies, techniques and limitations,  which may or may not  be
changed without shareholder approval.

HEALTH CARE FUND

The  Health  Care  Fund  has adopted  the  following  investment  limitations as
fundamental policies which (unless otherwise  noted) may not be changed  without
approval  by the  holders of  the lesser of  (i) 67%  of the  Health Care Fund's
shares represented at a meeting at which more than 50% of the outstanding shares
are represented, or (ii) more than 50% of the outstanding shares.

The Health Care Fund may not:

        (1) Invest more than 10% of its total assets in securities which  cannot
    be readily resold to the public because of legal or contractual restrictions
    or  for which  no readily  available market  exists, which  for this purpose
    includes repurchase agreements maturing in more than seven days;

        (2) Invest  in  companies  for  the purpose  of  exercising  control  or
    management;

        (3) Purchase or sell real estate; provided that the Health Care Fund may
    invest  in securities secured by real  estate or interests therein or issued
    by companies that invest in real estate or interests therein;

        (4) Purchase  securities  on margin  or  make short  sales,  except  for
    short-term  credits necessary  for clearance of  portfolio transactions, and
    except that the  Health Care Fund  may make short  sales and maintain  short
    positions  and  may  make margin  deposits  in  connection with  its  use of
    options, futures contracts and options on futures contracts;

        (5) Underwrite securities of other  issuers, except to the extent  that,
    in  connection with the disposition of portfolio securities, the Health Care
    Fund may be deemed to be an underwriter under federal securities laws;

        (6)  Make  loans,  except  through  loans  of  portfolio  securities  as
    authorized   by  the  Health  Care  Fund's  Prospectus  and  except  through
    repurchase agreements, provided  that for  purposes of  this limitation  the
    acquisition  of portfolio securities consistent  with the Health Care Fund's
    investment objective and policies shall not be deemed to be the making of  a
    loan;

        (7)  Purchase or  sell commodities  or commodity  contracts, except that
    consistent with the Health Care Fund's investment objective and policies the
    Health Care  Fund may  use financial  and currency  futures instruments  and
    options thereon for hedging purposes;

        (8) Issue senior securities, except that for purposes of this limitation
    the Health Care Fund may borrow money in such amounts and in such fashion as
    is permitted under the 1940 Act and the rules thereunder;

        (9)  Mortgage,  pledge  or hypothecate  or  in any  manner  transfer, as
    security for indebtedness, any securities owned  or held by the Health  Care
    Fund,  except as may  be necessary in  connection with permitted borrowings;
    provided, however, that this does not prohibit escrow, collateral or  margin
    arrangements  in  connection with  the Health  Care  Fund's use  of options,
    futures contracts and options on futures contracts;

       (10) Invest in oil, gas or mineral-related programs or leases; or

                  Statement of Additional Information Page 19
<PAGE>
                             GT GLOBAL THEME FUNDS

       (11) Purchase any security if as a result more than 5% of the Health Care
    Fund's total  assets would  be  invested in  securities of  companies  which
    together  with any predecessors  have been in operation  for less than three
    years.

An additional investment policy of the Health Care Fund, which may be changed by
vote of the Company's Board of Directors without shareholder approval,  provides
that  the Health  Care Fund will  not invest in  securities of an  issuer if the
investment would cause the Health Care Fund to own more than 10% of any class of
securities of any one issuer. Although it intends to do so only infrequently, if
at all, the Health Care Fund has the authority to invest up to 10% of its  total
assets  in shares of  other investment companies.  The Health Care  Fund may not
invest more than 5% of its total assets in any one investment company or acquire
more than 3% of the outstanding voting securities of any one investment company.

Investors should refer to the Prospectus for further information with respect to
the Health Care Fund's  investment objective, which may  not be changed  without
the  approval of the shareholders, and other investment policies, techniques and
limitations, which may be changed without shareholder approval.

TELECOMMUNICATIONS FUND

The Telecommunications Fund has adopted the following investment limitations  as
fundamental  policies which (unless otherwise noted)  may not be changed without
approval by  the holders  of the  lesser of  (i) 67%  of the  Telecommunications
Fund's shares represented at a meeting at which more than 50% of the outstanding
shares are represented, or (ii) more than 50% of the outstanding shares.

The Telecommunications Fund may not:

        (1)   Buy   or  sell   real  estate   (including  real   estate  limited
    partnerships); however,  the  Telecommunications  Fund may  invest  in  debt
    securities  secured  by  real  estate  or  interests  therein  or  issued by
    companies which invest in real  estate or interests therein, including  real
    estate investment trusts;

        (2) Purchase or sell commodities or commodity contracts, except that the
    Telecommunications Fund may purchase and sell financial and currency futures
    contracts  and options thereon,  and may purchase  and sell currency forward
    contracts, options on foreign currencies  and may otherwise engage in  other
    transactions in foreign currencies;

        (3)  Engage in the business of underwriting securities of other issuers,
    except to the  extent that  the disposition  of an  investment position  may
    technically cause it to be considered an underwriter as that term is defined
    under the Securities Act of 1933;

        (4)  Make loans,  except that  the Telecommunications  Fund may purchase
    debt securities and enter into repurchase  agreements and may make loans  of
    portfolio securities;

        (5)  Purchase securities on margin, provided that the Telecommunications
    Fund may  obtain  such  short-term  credits as  may  be  necessary  for  the
    clearance  of purchases  and sales  of securities;  except that  it may make
    margin deposits in connection with futures contracts;

        (6) Borrow money except from banks not in excess of 33 1/3% of the value
    of  the  Telecommunications  Fund's  total  assets,  including  the   amount
    borrowed,  less all liabilities and indebtedness (other than the borrowing).
    This restriction shall not prevent the Telecommunications Fund from entering
    into  reverse  repurchase  agreements,  provided  that  reverse   repurchase
    agreements,  and  any  other  transactions  constituting  borrowing  by  the
    Telecommunications Fund may not  exceed one-third of the  Telecommunications
    Fund's  total  assets.  Transactions involving  options,  futures contracts,
    options on futures contracts and forward currency contracts, as described in
    the Prospectus  and  Statement  of Additional  Information,  and  collateral
    arrangements relating thereto will not be deemed to be borrowings;

        (7)  Mortgage, pledge, or  hypothecate any of  its assets, provided that
    this restriction shall not apply to the transfer of securities in connection
    with any permissible borrowing or  to collateral arrangements in  connection
    with permissible activities; or

        (8)  Invest in direct interests or leases  in oil, gas, or other mineral
    exploration or development  programs; however,  the Telecommunications  Fund
    may invest in the securities of companies that engage in these activities.

In addition, the Telecommunications Fund has adopted as a fundamental investment
policy the classification as a "diversified" fund under the 1940 Act which means
that, with respect to 75% of the Telecommunications Fund's total assets, no more
than  5%  will  be  invested  in  the securities  of  any  one  issuer,  and the
Telecommunications Fund will purchase no more than 10% of the outstanding voting
securities  of  any  one   issuer.  This  policy   cannot  be  changed   without

                  Statement of Additional Information Page 20
<PAGE>
                             GT GLOBAL THEME FUNDS
approval  by  the  holders  of  a  majority  of  the  Telecommunications  Fund's
outstanding voting securities as defined above and in the Prospectus.

The  following  operating  policies  of  the  Telecommunications  Fund  are  not
fundamental  policies  and may  be changed  by  vote of  the Company's  Board of
Directors without shareholder approval. The Telecommunications Fund may not:

        (1) Invest in securities of an issuer if the investment would cause  the
    Telecommunications  Fund to own more than 10%  of any class of securities of
    any one issuer;

        (2) Invest  in  companies  for  the purpose  of  exercising  control  or
    management;

        (3)  Invest  more than  15% of  its net  assets in  illiquid securities,
    including securities that are illiquid by virtue of the absence of a readily
    available market;

        (4) Invest more than 5% of  its total assets in securities of  companies
    having,  together with their predecessors, a record of less than three years
    of continuous operation;

        (5) Purchase or retain the securities of any issuer, if those individual
    officers  and  Directors  of  the  Company,  the  Telecommunications  Fund's
    investment  adviser, or distributor, each  owning beneficially more than 1/2
    of 1% of the  securities of such  issuer, together own more  than 5% of  the
    securities of such issuer;

        (6)  Enter into a futures contract, an  option on a futures contract, or
    an option on foreign currency traded  on a CFTC-regulated exchange, in  each
    case  other than for BONA FIDE hedging purposes (as defined by the CFTC), if
    the aggregate initial margin and premiums required to establish all of those
    positions (excluding the amount by which options are "in-the-money") exceeds
    5% of  the liquidation  value of  the Fund's  portfolio, after  taking  into
    account  unrealized profits and unrealized losses  on any contracts the Fund
    has entered into; or

        (7) Borrow money  except for  temporary or emergency  purposes (not  for
    leveraging)  not in excess of 33 1/3% of the value of the Telecommunications
    Fund's total assets.  While borrowings exceed  5% of the  Telecommunications
    Fund's   total  assets,  the  Telecommunications  Fund  will  not  make  any
    additional investments.

The Telecommunications Fund has the authority to  invest up to 10% of its  total
assets  in shares of  other investment companies, and  in real estate investment
trusts. The Telecommunications  Fund may not  invest more than  5% of its  total
assets  in any one investment company or acquire more than 3% of the outstanding
voting securities of any one investment company.

Investors should refer to the Prospectus for further information with respect to
the Telecommunications Fund's  investment objective,  which may  not be  changed
without  the approval of shareholders, and other investment policies, techniques
and limitations, which may be changed without shareholder approval.

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

If a  percentage  restriction on  investment  or  utilization of  assets  in  an
investment  policy or  restriction is  adhered to at  the time  an investment is
made, a later change in percentage ownership of a security or kind of securities
resulting from changing market  values or a  similar type of  event will not  be
considered  a  violation  of  a Fund's  or  Portfolio's  investment  policies or
restrictions. A Fund or Portfolio  may exchange securities, exercise  conversion
or  subscription rights,  warrants or other  rights to purchase  common stock or
other equity securities and may hold, except  to the extent limited by the  1940
Act, any such securities so acquired without regard to the Fund's or Portfolio's
investment  policies and  restrictions. The original  cost of  the securities so
acquired will  be  included in  any  subsequent  determination of  a  Fund's  or
Portfolio's  compliance with  the investment percentage  limitations referred to
above and in the Prospectus.

                  Statement of Additional Information Page 21
<PAGE>
                             GT GLOBAL THEME FUNDS

                             EXECUTION OF PORTFOLIO
                                  TRANSACTIONS

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

Subject to policies  established by  the Company's  Board of  Directors and  the
Portfolios'  Board  of Trustees,  LGT Asset  Management  is responsible  for the
execution of each Theme Portfolio's securities transactions and the selection of
broker/ dealers who execute such transactions on behalf of each Theme Portfolio.
In executing portfolio  transactions, LGT  Asset Management seeks  the best  net
results  for each Theme Portfolio, taking into account such factors as the price
(including the applicable brokerage  commission or dealer  spread), size of  the
order,  difficulty of execution and operational facilities of the firm involved.
Although LGT Asset Management generally seeks reasonably competitive  commission
rates and spreads, payment of the lowest commission or spread is not necessarily
consistent  with the best net results. While  each Theme Portfolio may engage in
soft dollar arrangements for research  services, as described below, each  Theme
Portfolio  has  no  obligation  to  deal  with  any  broker/dealer  or  group of
broker/dealers in the execution of portfolio transactions.

Consistent with the interests of each Theme Portfolio, LGT Asset Management  may
select broker/dealers to execute that Theme Portfolio's portfolio transaction on
the  basis of  the research  and brokerage  services they  provide to  LGT Asset
Management for its use in managing  that Theme Portfolio and its other  advisory
accounts. Such services may include furnishing analyses, reports and information
concerning issuers, industries, securities, geographic regions, economic factors
and  trends,  portfolio strategy,  and  performance of  accounts;  and effecting
securities transactions  and performing  functions incidental  thereto (such  as
clearance  and settlement). Research  and brokerage services  received from such
broker is  in addition  to, and  not in  lieu of,  the services  required to  be
performed by LGT Asset Management under the applicable Investment Management and
Administration Contract (defined below). A commission paid to such broker may be
higher than that which another qualified broker would have charged for effecting
the  same transaction,  provided that  LGT Asset  Management determines  in good
faith that such  commission is  reasonable in  terms either  of that  particular
transaction  or the overall responsibility of LGT Asset Management to that Theme
Portfolio and its other clients and that the total commissions paid by the Theme
Portfolio will be reasonable in relation to the benefits received by that  Theme
Portfolio  over  the long  term.  Research services  may  also be  received from
dealers who execute Theme Portfolio transactions in over-the-counter-markets.

LGT Asset Management may allocate  brokerage transactions to broker/dealers  who
have entered into arrangements under which the broker/dealer allocates a portion
of  the  commissions paid  by a  Theme  Portfolio toward  payment of  that Theme
Portfolio's expenses, such as custodian fees.

Investment decisions for  a Theme  Portfolio and for  other investment  accounts
managed by LGT Asset Management are made independently of each other in light of
differing  conditions. However, the same investment decision occasionally may be
made for two  or more of  such accounts,  including a Theme  Portfolio. In  such
cases,  simultaneous  transactions  may  occur.  Purchases  or  sales  are  then
allocated as to price  or amount in  a manner deemed fair  and equitable to  all
accounts  involved. While in  some cases this practice  could have a detrimental
effect upon the price or  value of the security as  far as a Theme Portfolio  is
concerned,  in other cases  LGT Asset Management  believes that coordination and
the ability to  participate in volume  transactions will be  beneficial to  that
Theme Portfolio.

Under  a policy adopted  by the Company's  Board of Directors  and a Portfolio's
Board of Trustees, and subject to the policy of obtaining the best net  results,
LGT  Asset Management may consider  a broker/dealer's sale of  the shares of the
Funds and  the  other  portfolios  for which  LGT  Asset  Management  serves  as
investment   manager  or  administrator  in  selecting  broker/dealers  for  the
execution of portfolio transactions. This policy does not imply a commitment  to
execute  portfolio transactions through  all broker/dealers that  sell shares of
the Funds and such other portfolios.

Each Theme Portfolio contemplates purchasing  most foreign equity securities  in
OTC  markets or stock exchanges located in the countries in which the respective
principal offices of the issuers of the various securities are located, if  that
is the best available market. The fixed commissions paid in connection with most
such foreign stock transactions generally are higher than negotiated commissions
on  U.S.  transactions.  There  generally  is  less  government  supervision and
regulation of foreign  stock exchanges and  brokers than in  the United  States.
Foreign  security settlements  may in  some instances  be subject  to delays and
related administrative uncertainties.

                  Statement of Additional Information Page 22
<PAGE>
                             GT GLOBAL THEME FUNDS

Foreign equity securities may be held by a Theme Portfolio in the form of  ADRs,
ADSs, EDRs, CDRs or securities convertible into foreign equity securities. ADRs,
ADSs,  EDRs  and  CDRs  may be  listed  on  stock exchanges,  or  traded  in the
over-the-counter markets in  the United States  or Europe, as  the case may  be.
ADRs,  like other  securities traded  in the United  States, will  be subject to
negotiated commission rates. The foreign and domestic debt securities and  money
market instruments in which a Theme Portfolio may invest are generally traded in
the over-the-counter markets.

A Theme Portfolio does not have any obligation to deal with any broker/dealer or
group  of broker/dealers in the execution of securities transactions. Each Theme
Portfolio contemplates that, consistent  with the policy  of obtaining the  best
net  results, brokerage transactions may  be conducted through certain companies
that are members of Liechtenstein Global Trust. The Company's Board of Directors
or the Portfolios' Board of Trustees,  as applicable, has adopted procedures  in
conformity  with Rule  17e-1 under  the 1940  Act to  ensure that  all brokerage
commissions paid to such  affiliates are reasonable and  fair in the context  of
the  market in which they are operating.  Any such transactions will be effected
and  related  compensation   paid  only  in   accordance  with  applicable   SEC
regulations. For the fiscal years ended October 31, 1994, 1993, 1992, the Health
Care  Fund  paid  aggregate  brokerage  commissions  of  $480,241,  $665,620 and
$480,293, respectively. For the fiscal years ended October 31, 1994 and 1993 and
for the fiscal period January 27,  1992 (commencement of operations) to  October
31,  1992, the Telecommunications  Fund paid aggregate  brokerage commissions of
$5,674,965, $2,051,270 and $1,110,119, respectively.  For the fiscal period  May
31,  1994  (commencement  of  operations) to  October  31,  1994,  the Financial
Services Portfolio,  Infrastructure Portfolio  and Natural  Resources  Portfolio
paid   aggregate  brokerage  commissions  of  $18,145,  $111,512  and  $132,572,
respectively.

THEME PORTFOLIO TRADING AND TURNOVER
Although each Theme Portfolio does not intend generally to trade for  short-term
profits,  the  securities held  by that  Theme Portfolio  will be  sold whenever
management believes it is appropriate to do so, without regard to the length  of
time a particular security may have been held (except to the extent necessary to
avoid non-compliance with the "Short-Short Limitation" described in "Taxes").

A  Theme  Portfolio  engages  in  such trading  when  LGT  Asset  Management has
concluded that the sale of a security  owned by that Theme Portfolio and/or  the
purchase  of  another  security of  better  value can  enhance  principal and/or
increase income. A  security may  be sold to  avoid any  prospective decline  in
market  value, or a security may be  purchased in anticipation of a market rise.
Consistent with each Theme Portfolio's investment objective, a security may also
be sold and  a comparable  security purchased  coincidentally in  order to  take
advantage  of what is believed  to be a disparity in  the normal yield and price
relationship between the two securities.

Each Theme Portfolio anticipates that its annual portfolio turnover rate  should
not  exceed 100%. However,  the portfolio turnover  rate will not  be a limiting
factor when management  deems portfolio  changes appropriate.  A 100%  portfolio
turnover  rate would occur if  the lesser of the value  of purchases or sales of
portfolio securities for a  Theme Portfolio for a  year (excluding purchases  of
U.S.  Treasury and other securities  with a maturity at  the date of purchase of
one year  or less)  were equal  to  100% of  the average  monthly value  of  the
securities,  excluding  short-term  investments, held  by  that  Theme Portfolio
during such  year. Higher  portfolio turnover  involves correspondingly  greater
brokerage  commissions and other transaction costs that the Theme Portfolio will
bear directly.  For  the fiscal  years  ended October  31,  1994 and  1993,  the
Telecommunications   Fund's  portfolio   turnover  rates   were  57%   and  41%,
respectively. For the fiscal years ended  October 31, 1994 and 1993, the  Health
Care  Fund's portfolio  turnover rates were  64% and 61%,  respectively. For the
fiscal period May 31, 1994 (commencement of operations) to October 31, 1994, the
portfolio turnover rates  for the Financial  Services Portfolio,  Infrastructure
Portfolio and Natural Resources Portfolio were 53%, 18% and 137%, respectively.

                  Statement of Additional Information Page 23
<PAGE>
                             GT GLOBAL THEME FUNDS

                        DIRECTORS AND EXECUTIVE OFFICERS

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

The  Company's  By-Laws authorize  a  Board of  Directors  of between  1  and 25
persons, as fixed by the Board  of Directors. Directors normally are elected  by
shareholders;  however,  a majority  of  remaining Directors  may  fill Director
vacancies caused  by resignation,  death or  expansion of  the Board.  The  term
"Directors"  as used below refers to the Company's Directors and the Portfolios'
Trustees collectively. The  Company's Directors and  Executive Officers and  the
Portfolios' Trustees and Executive Officers are listed below.

<TABLE>
<CAPTION>
NAME, POSITION(S) WITH THE               PRINCIPAL OCCUPATIONS AND BUSINESS
COMPANY AND ADDRESS                      EXPERIENCE FOR PAST 5 YEARS
- ---------------------------------------  ------------------------------------------------------------------------------------------
<S>                                      <C>
David A. Minella*, 42                    Director of Liechtenstein Global Trust (holding company of the various international LGT
Director, Chairman of the Board and      companies) since 1990; Director and President of LGT Asset Management since 1989; Director
President                                and President of GT Global since 1987; and Director and President of GT Services since
50 California Street                     1990. Mr. Minella also is a director or trustee of each of the other investment companies
San Francisco, CA 94111                  registered under the 1940 Act that is managed or administered by LGT Asset Management.

C. Derek Anderson, 53                    Chairman, Anderson Capital Management, Inc. from 1988 to present; Chairman, Plantagenet
Director                                 Holdings, Ltd. from 1991 to present; Director, Munsingwear, Inc.; Director, American
220 Sansome Street                       Heritage Group Inc.; Director, T.L. Higgins Inc. and various other companies. Mr. Anderson
Suite 400                                also is a director or trustee of each of the other investment companies registered under
San Francisco, CA 94104                  the 1940 Act that is managed or administered by LGT Asset Management.

Frank S. Bayley, 55                      A Partner with Baker & McKenzie (a law firm), and serves as Director and Chairman of C.D.
Director                                 Stimson Company (a private investment company); Trustee, Seattle Art Museum. Mr. Bayley
Two Embarcadero Center                   also is a director or trustee of each of the other investment companies registered under
San Francisco, CA 94111                  the 1940 Act that is managed or administered by LGT Asset Management.

Arthur C. Patterson, 52                  Managing Partner of Accel Partners (a venture capital firm). Mr. Patterson also serves as
Director                                 a director of various computing and software companies. Mr. Patterson also is a director
One Embarcadero Center                   or trustee of each of the other investment companies registered under the 1940 Act that is
Suite 3820                               managed or administered by LGT Asset Management.
San Francisco, CA 94111

Ruth H. Quigley, 59                      Private investor. From 1984 to 1986, Miss Quigley was President of Quigley Friedlander &
Director                                 Co., Inc. (a financial advisory services firm). Ms. Quigley also is a director or trustee
1055 California Street                   of each of the other investment companies registered under the 1940 Act that is managed or
San Francisco, CA 94108                  administered by LGT Asset Management.

F. Christian Wignall, 39                 Senior Vice President, Chief Investment Officer - Global Equities and a Director of G.T.
Vice President and Chief Investment      Capital since 1987, and Chairman of the Global Investment Policy Committee of affiliated
Officer -                                international LGT companies since 1990.
Global Equities
50 California Street
San Francisco, CA 94111
</TABLE>

                  Statement of Additional Information Page 24
<PAGE>
                             GT GLOBAL THEME FUNDS
<TABLE>
<CAPTION>
NAME, POSITION(S) WITH THE               PRINCIPAL OCCUPATIONS AND BUSINESS
COMPANY AND ADDRESS                      EXPERIENCE FOR PAST 5 YEARS
- ---------------------------------------  ------------------------------------------------------------------------------------------
<S>                                      <C>
Gary Kreps, 40                           Senior Vice President and Chief Investment Officer - Global Fixed Income Investments and a
Vice President and Chief                 Director of LGT Asset Management since 1992. Prior to joining LGT Asset Management, Mr.
Investment Officer -                     Kreps was Senior Vice President of the Putnam Companies from 1988 to 1992.
Global Fixed Income
50 California Street
San Francisco, CA 94111

James R. Tufts, 37                       Senior Vice President -- Finance and Administration of LGT Asset Management, GT Global and
Vice President and                       GT Services since 1994. Prior thereto, Mr. Tufts was Vice President -- Finance of LGT
Chief Financial Officer                  Asset Management and GT Global since 1987; Vice President -- Finance of GT Services since
50 California Street                     1990; and a Director of LGT Asset Management, GT Global and GT Services since 1991.
San Francisco, CA 94111

Kenneth W. Chancey, 50                   Vice President of LGT Asset Management and GT Global since 1992. Mr. Chancey was Vice
Vice President and Principal             President of Putnam Fiduciary Trust Company from 1989 to 1992.
Accounting Officer
50 California Street
San Francisco, CA 94111

Helge K. Lee, 48                         Senior Vice President, General Counsel and Secretary of LGT Asset Management, GT Global
Vice President and Secretary             and GT Services since May, 1994. Mr. Lee was the Senior Vice President, General Counsel
50 California Street                     and Secretary of Strong/Corneliuson Management, Inc. and Secretary of each of the Strong
San Francisco, CA 94111                  Funds from October, 1991 through May, 1994. For more than five years prior to October,
                                         1991, he was a shareholder in the law firm of Godfrey & Kahn, S.C., Milwaukee, Wisconsin.

Peter R. Guarino, 36                     Assistant General Counsel of LGT Asset Management, GT Global and GT Services since 1991.
Assistant Secretary                      From 1989 to 1991, Mr. Guarino was an attorney at The Dreyfus Corporation. Prior thereto,
50 California Street                     he was associated with Colonial Management Associates, Inc.
San Francisco, CA 94111
</TABLE>

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

*    Mr. Minella is an "interested person" of the Company as defined by the 1940
    Act due to his affiliation with the LGT companies.

The Board of Directors has a  Nominating and Audit Committee, comprised of  Miss
Quigley  and Messrs.  Anderson, Bayley and  Patterson, which  is responsible for
nominating persons to serve  as Directors, reviewing audits  of the Company  and
its  funds  and  recommending firms  to  serve  as independent  auditors  of the
Company. Each of the Directors  and officers of the  Company is also a  Director
and  officer  of GT  Global Developing  Markets  Fund, Inc.,  and a  Trustee and
officer of  G.T. Global  Growth  Series, GT  Greater  Europe Fund,  G.T.  Global
Variable  Investment  Trust,  G.T.  Global  Variable  Investment  Series, Global
Investment Portfolio (of which  the Portfolios are  subtrusts), and Global  High
Income  Portfolio, which also are registered investment companies managed by LGT
Asset Management. Each Director and Officer serves in total as a Director and/or
Trustee and Officer, respectively, of 9 registered investment companies with  38
series  managed or administered  by LGT Asset Management.  The Company pays each
Director who is not a director, officer  or employee of LGT Asset Management  or
any affiliated company $5,000 a year, plus $300 per Fund for each meeting of the
Board  attended  by  the  Director, and  reimburses  travel  and  other expenses
incurred in  connection  with  attending Board  meetings.  Other  Directors  and
officers  receive no compensation or expense  reimbursement from the Company. As
of the date of this Statement, the officers and Directors and their families  as
a  group owned in  the aggregate beneficially or  of record less  than 1% of the
outstanding shares of each Fund or of all the Company's funds in the  aggregate.
For  the fiscal year ended December 31, 1994, the Company paid Mr. Anderson, Mr.
Bayley, Mr. Patterson and Ms. Quigley Directors' fees and expense reimbursements
of $37,114,  $39,425, $31,941  and $33,178,  respectively. For  the fiscal  year
ended October 31, 1994, Mr. Anderson, Mr. Bayley, Mr. Patterson and Ms. Quigley,
who  are not  directors, officers  or employees of  LGT Asset  Management or any
affiliated company, received total compensation of $94,511, $99,529, $82,742 and
$86,914, respectively, from  the 38 GT  Funds for which  he or she  serves as  a
Director  or Trustee. Fees and expenses  disbursed to the Directors contained no
accrued or  payable pension  or retirement  benefits.  As of  the date  of  this
Statement  of  Additional  Information,  the officers  and  Directors  and their
families as a group owned in the  aggregate beneficially or of record less  than
1%  of the  outstanding shares  of the Funds,  except in  the Financial Services
Fund, in  the  aggregate.  As  of  the date  of  this  Statement  of  Additional
Information,  the officers and Directors and their  families as a group owned in
the aggregate beneficially or of record  1.04% of the outstanding shares of  the
Financial Services Fund.

                  Statement of Additional Information Page 25
<PAGE>
                             GT GLOBAL THEME FUNDS

                                   MANAGEMENT

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

INVESTMENT  MANAGEMENT AND ADMINISTRATION SERVICES  RELATING TO THE FEEDER FUNDS
AND THE PORTFOLIOS
LGT  Asset  Management  serves  as  each  Portfolio's  investment  manager   and
administrator under an Investment Management and Administration Contract between
each  Portfolio and LGT Asset  Management ("Portfolio Management Contract"). LGT
Asset  Management  serves  as  administrator  to  each  Feeder  Fund  under   an
administration   contract  between   the  Company   and  LGT   Asset  Management
("Administration Contract"). The Administration Contract  will not be deemed  an
advisory  contract, as  defined under  the 1940  Act. As  investment manager and
administrator, LGT  Asset Management  makes all  investment decisions  for  each
Portfolio  and,  as  administrator,  administers  each  Portfolio's  and  Fund's
affairs. Among other  things, LGT  Asset Management furnishes  the services  and
pays  the compensation and travel expenses of persons who perform the executive,
administrative, clerical and  bookkeeping functions of  each Portfolio and  each
Feeder Fund and provides suitable office space, necessary small office equipment
and  utilities. For these  services, each Feeder  Fund pays administration fees,
computed daily and paid monthly, to LGT Asset Management at the annualized  rate
of  0.25% of the Fund's average daily  net assets. In addition, each Feeder Fund
bears a pro  rata portion of  the investment management  and administration  fee
paid by its corresponding Portfolio to LGT Asset Management. Each Portfolio pays
such  fees based on its  average daily net assets,  also computed daily and paid
monthly, at the annualized rate of 0.725% on the first $500 million, .70% on the
next $500 million,  .675% on  the next  $500 million,  and .65%  on all  amounts
thereafter.

The  Portfolio Management Contract  and the Administration  Contract each has an
initial two-year term (or  will expire on June  30, 1995, whichever is  earlier)
with  respect to each Portfolio and its corresponding Feeder Fund, respectively,
from the  date of  the  commencement of  the  Fund's operations.  The  Portfolio
Management  Contract may be  renewed with respect to  a Portfolio for additional
one-year terms thereafter, provided that any such renewal has been  specifically
approved  at least annually by (i) the Portfolios' Board of Trustees or the vote
of a majority of  the Portfolio's outstanding voting  securities (as defined  in
the  1940  Act) and  (ii) a  majority of  Trustees  who are  not parties  to the
Portfolio Management  Contract or  "interested persons"  of any  such party  (as
defined  in the 1940 Act),  cast in person at a  meeting called for the specific
purpose of  voting on  such  approval. Regarding  the Financial  Services  Fund,
Infrastructure  Fund  and  Natural  Resources  Fund,  the  Portfolio  Management
Contract and  the Administration  Contract were  each approved  by vote  of  the
Portfolios'  Board of Trustees  and the Company's Board  of Directors on January
11, 1994, and by LGT Asset Management  as the initial shareholder of the  Feeder
Fund  on April 8, 1994.  Regarding the Consumer Products  and Services Fund, the
Portfolio Management Contract and the Administration Contract were each approved
by vote  of  the  Portfolios' Board  of  Trustees  and the  Company's  Board  of
Directors  on  June  15,  1994,  and by  LGT  Asset  Management  as  the initial
shareholder of the Fund on December 20, 1994. The Portfolio Management  Contract
provides  that with respect  to each Portfolio,  and the Administration Contract
provides that  with  respect to  each  Feeder  Fund, either  the  Company,  each
Portfolio  or LGT  Asset Management may  terminate the  Contract without penalty
upon sixty days'  written notice to  the other party.  The Portfolio  Management
Contract  terminates automatically in the event of its assignment (as defined in
the 1940 Act).

Under the  Portfolio Management  Contract, LGT  Asset Management  has agreed  to
reduce  the  investment  management  and  administration  fees  payable  by each
Portfolio by  the amount  that  the ordinary  operating expenses  (exclusive  of
brokerage commissions, organization expenses, interest, taxes,
distribution-related   expenses,  certain  expenses  attributable  to  investing
outside the United States and extraordinary expenses) of that Portfolio for  any
fiscal  year borne by its corresponding  Fund, together with the direct ordinary
operating expenses (exclusive  of brokerage  commission, organization  expenses,
taxes,   interest,  certain  distribution-related   expenses  and  extraordinary
expenses) of such Fund, shall exceed the most stringent limits prescribed by any
state in which the shares of the Fund are offered for sale. Currently, the  most
restrictive applicable limitation provides that a Feeder Fund's expenses may not
exceed  an annual rate of 2 1/2% of the first $30 million of average net assets,
2% of the next $70 million of average  net assets and 1 1/2% of all average  net
assets   thereafter.  LGT  Asset  Management  and  GT  Global  have  voluntarily
undertaken to  limit the  Class  A and  Class B  expenses  of each  Feeder  Fund
(exclusive of brokerage commissions, interest, taxes and extraordinary items) to
the  maximum annual level of 2.40% and 2.90%, respectively, of the average daily
net assets of the respective  classes of the Fund  during each fiscal year,  and
LGT  Asset Management has agreed  to reimburse each Feeder  Fund if its expenses
exceed that amount.

                  Statement of Additional Information Page 26
<PAGE>
                             GT GLOBAL THEME FUNDS

INVESTMENT MANAGEMENT AND ADMINISTRATION SERVICES RELATING TO THE HEALTH CARE
FUND AND TELECOMMUNICATIONS FUND
LGT Asset Management serves as the  investment manager and administrator to  the
Health  Care Fund and Telecommunications Fund under an Investment Management and
Administration Contract  ("Management Contract")  between  the Company  and  LGT
Asset  Management. As investment manager and administrator, LGT Asset Management
makes all investment decisions for  the Health Care Fund and  Telecommunications
Fund and administers the Health Care Fund and Telecommunications Fund's affairs.
Among  other things,  LGT Asset Management  furnishes the services  and pays the
compensation  and  travel  expenses  of  persons  who  perform  the   executive,
administrative, clerical and bookkeeping functions of the Company and the Health
Care  Fund  and Telecommunications  Fund,  and provides  suitable  office space,
necessary small office equipment and  utilities. For these services, the  Health
Care  Fund and Telecommunications Fund each pays LGT Asset Management investment
management  and  administration  fees,  based  on  the  Health  Care  Fund   and
Telecommunications  Fund's  average daily  net assets,  computed daily  and paid
monthly, at the annualized rate of .975% on the first $500 million, .95% on  the
next  $500 million,  .925% on  the next  $500 million,  and .90%  on all amounts
thereafter.

The  Management   Contract  relating   to   the  Health   Care  Fund   and   the
Telecommunications  Fund  took  effect August  7,  1989, and  January  27, 1992,
respectively, and had an initial two-year  term. The Management Contract may  be
renewed for additional one-year terms thereafter with respect to the Health Care
Fund  and  Telecommunications  Fund, provided  that  any such  renewal  has been
specifically  approved  at  least  annually  by:  (i)  the  Company's  Board  of
Directors,  or  by  the  vote  of  a  majority  of  the  Health  Care  Fund  and
Telecommunications Fund's outstanding voting securities (as defined in the  1940
Act),  and (ii) a  majority of Directors  who are not  parties to the Management
Contract or "interested persons" of any such party (as defined in the 1940 Act),
cast in person at a  meeting called for the specific  purpose of voting on  such
approval. The Management Contract was most recently approved with respect to the
Health  Care  Fund and  Telecommunications  Fund by  the  vote of  the  Board of
Directors of the  Company on June  15, 1994 and  by the Health  Care Fund's  and
Telecommunications  Fund's shareholders at  their meetings on  June 25, 1991 and
January 20,  1993,  respectively. The  Management  Contract provides  that  with
respect  to the Health Care Fund  and Telecommunications Fund either the Company
or LGT Asset Management  may terminate the Contract  without penalty upon  sixty
(60) days' written notice to the other party. The Management Contract terminates
automatically in the event of its assignment (as defined in the 1940 Act).

Under  the Management  Contract, LGT  Asset Management  has agreed  to waive its
investment management  and administration  fees from  the Health  Care Fund  and
Telecommunications   Fund  and   to  reimburse   the  Health   Care  Fund's  and
Telecommunications Fund to the extent necessary  to assure that the Health  Care
Fund's  and Telecommunications  Fund's annual  expenses (exclusive  of brokerage
commissions,  organizational  expenses,  taxes,  interest,  distribution-related
expenses,  certain expenses attributable to  investing outside the United States
and extraordinary expenses) do not exceed the most stringent expense limitations
prescribed by any  state in which  the Health Care  Fund and  Telecommunications
Fund's  shares are offered for sale.  Currently, the most restrictive applicable
limitation provides  that the  Health Care  Fund and  Telecommunications  Fund's
expenses  may not exceed  an annual rate of  2 1/2% of the  first $30 million of
average net assets, 2% of the next $70 million of average net assets and 1  1/2%
of  assets  in excess  of  that amount.  In addition,  GT  Global and  LGT Asset
Management have  voluntarily undertaken  to  limit the  Health Care  Fund's  and
Telecommunications  Fund's  Class A  and Class  B  share expenses  (exclusive of
brokerage commissions, taxes, interest and extraordinary expenses) to the annual
level of 2.40%  and 2.90% of  the average daily  net assets of  the Class A  and
Class  B shares, respectively, during each fiscal year, and LGT Asset Management
has agreed to reimburse the Health Care Fund and Telecommunications Fund if  the
Health Care Fund's and Telecommunications Fund's expenses exceed that amount.

                  Statement of Additional Information Page 27
<PAGE>
                             GT GLOBAL THEME FUNDS

The   following  table  discloses  the   amount  of  investment  management  and
administration fees paid by the Theme Portfolios to LGT Asset Management  during
the periods shown:

                                HEALTH CARE FUND

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,                                                                                       AMOUNT PAID
- ----------------------------------------------------------------------------------------------------------  --------------
<S>                                                                                                         <C>
1994......................................................................................................  $    4,353,688
1993......................................................................................................       5,331,224
1992......................................................................................................       6,789,400
</TABLE>

                            TELECOMMUNICATIONS FUND

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,                                                                                       AMOUNT PAID
- ----------------------------------------------------------------------------------------------------------  --------------
<S>                                                                                                         <C>
1994......................................................................................................  $   21,926,187
1993......................................................................................................       7,254,611
1992 (since Fund inception on January 27, 1992)...........................................................       2,624,818
</TABLE>

                          FINANCIAL SERVICES PORTFOLIO

<TABLE>
<CAPTION>
                                                                                                             AMOUNT PAID
                                                                                                            --------------
<S>                                                                                                         <C>
May 31, 1994 (commencement of operations) to October 31, 1994.............................................  $            0
</TABLE>

                            INFRASTRUCTURE PORTFOLIO

<TABLE>
<CAPTION>
                                                                                                             AMOUNT PAID
                                                                                                            --------------
<S>                                                                                                         <C>
May 31, 1994 (commencement of operations) to October 31, 1994.............................................  $        3,021
</TABLE>

                          NATURAL RESOURCES PORTFOLIO

<TABLE>
<CAPTION>
                                                                                                             AMOUNT PAID
                                                                                                            --------------
<S>                                                                                                         <C>
May 31, 1994 (commencement of operations) to October 31, 1994.............................................  $            0
</TABLE>

For  the fiscal period May 31, 1994  (commencement of operations) to October 31,
1994,  LGT  Asset  Management  reimbursed  the  Financial  Services   Portfolio,
Infrastructure  Portfolio and  Natural Resources Portfolio  for their respective
investment management and administration fees in the amounts of $8,249,  $48,901
and  $28,500, respectively.  For the same  period, the  Financial Services Fund,
Infrastructure Fund and Natural  Resources Fund did  not pay any  administration
fees;  however, LGT Asset Management reimbursed those Funds for such fees in the
amounts of $3,029,  $19,370 and  $10,436, respectively.  Accordingly, LGT  Asset
Management  reimbursed  the  Financial Services  Fund,  Infrastructure  Fund and
Natural Resources Fund and their respective Portfolios investment management and
administration fees in the  aggregate amounts of  $11,278, $68,271 and  $38,936,
respectively.

For  the fiscal period May 31, 1994  (commencement of operations) to October 31,
1994, LGT Asset Management, pursuant to a voluntary expense undertaking to limit
expenses to  the maximum  annual  level of  2.40%  and 2.90%,  respectively,  of
average  daily net assets of the Class A shares and Class B shares of the Funds,
reimbursed the Financial Services  Fund and Natural Resources  Fund for Class  A
and  Class  B  expenses  in  the  additional  amounts  of  $85,566  and $49,648,
respectively.

DISTRIBUTION SERVICES RELATING TO EACH FUND
Each Fund's Class  A and Class  B shares are  offered continuously through  each
Fund's  principal underwriter  and distributor, GT  Global, on  a "best efforts"
basis pursuant to  separate Distribution  Contracts between the  Company and  GT
Global.  The Distribution  Contracts were  approved with  respect to  the Fund's
Class A and Class B shares by the Board of Directors for the Financial  Services
Fund,  Infrastructure  Fund,  Natural  Resources  Fund,  Health  Care  Fund  and
Telecommunications Fund  on June  15, 1994,  and on  November 10,  1994 for  the
Consumer Products and Services Fund.

As  described in the  Prospectus, the Company  has adopted separate Distribution
Plans with respect to Class A and Class B shares of the Funds in accordance with
the provisions of Rule  12b-1 under the  1940 Act ("Class A  Plan" and "Class  B
Plan")  (collectively, "Plans").  The rate  of payments  by the  Funds under the
Plans, as described in the Prospectus, may not be increased without the approval
of the majority of the outstanding voting securities of the affected class.  All
expenses for which GT Global is reimbursed under the Class A Plan will have been
incurred  within one  year of  such reimbursement.  Each Fund  makes no payments
under the Plans  to any party  other than  GT Global, which  is the  distributor
(principal

                  Statement of Additional Information Page 28
<PAGE>
                             GT GLOBAL THEME FUNDS
underwriter)  of the Funds' shares. The  following table discloses payments made
by the Theme Funds to GT Global under each Fund's Class A Plan and Class B  Plan
for the Fund's fiscal year ended October 31, 1994:

                                HEALTH CARE FUND

<TABLE>
<CAPTION>
                                                                                                 CLASS A        CLASS B
                                                                                               AMOUNT PAID    AMOUNT PAID
                                                                                              -------------  -------------
<S>                                                                                           <C>            <C>
Year ended October 31, 1994.................................................................  $   2,102,985  $     259,350
</TABLE>

                            TELECOMMUNICATIONS FUND

<TABLE>
<CAPTION>
                                                                                                 CLASS A        CLASS B
                                                                                               AMOUNT PAID    AMOUNT PAID
                                                                                              -------------  -------------
<S>                                                                                           <C>            <C>
Year ended October 31, 1994.................................................................  $   7,330,230  $   8,894,192
</TABLE>

                            FINANCIAL SERVICES FUND

<TABLE>
<CAPTION>
                                                                                                 CLASS A        CLASS B
                                                                                               AMOUNT PAID    AMOUNT PAID
                                                                                              -------------  -------------
<S>                                                                                           <C>            <C>
May 31, 1994 (commencement of operations) to October 31, 1994...............................  $       3,860  $       4,398
</TABLE>

                              INFRASTRUCTURE FUND

<TABLE>
<CAPTION>
                                                                                                 CLASS A        CLASS B
                                                                                               AMOUNT PAID    AMOUNT PAID
                                                                                              -------------  -------------
<S>                                                                                           <C>            <C>
May 31, 1994 (commencement of operations) to October 31, 1994...............................  $      18,271  $      40,937
</TABLE>

                             NATURAL RESOURCES FUND

<TABLE>
<CAPTION>
                                                                                                 CLASS A        CLASS B
                                                                                               AMOUNT PAID    AMOUNT PAID
                                                                                              -------------  -------------
<S>                                                                                           <C>            <C>
May 31, 1994 (commencement of operations) to October 31, 1994...............................  $      11,282  $      19,180
</TABLE>

The Plans were approved on June 15, 1994, with respect to the Financial Services
Fund,  Infrastructure  Fund,  Natural  Resources  Fund,  Health  Care  Fund  and
Telecommunications Fund and on November 10,  1994, with respect to the  Consumer
Products  and Services  Fund, by the  Company's Board of  Directors, including a
majority of  Directors who  are  not "interested  persons"  of the  Company  (as
defined  in the 1940 Act) and who have no direct or indirect financial interests
in the operation of the Plans,  or in any agreement related thereto  ("Qualified
Directors").  In approving the Plans, the Directors determined that the adoption
of the  Plans was  in  the best  interests of  the  shareholders of  that  Fund.
Agreements  related  to the  Plans must  also be  approved by  such vote  of the
Directors and Qualified Directors  as described above.  A plan of  distribution,
which  was substantially similar to the Class A Plan, was approved by the Health
Care Fund and Telecommunications Fund's  shareholders at their meetings held  on
June 25, 1991 and January 20, 1993, respectively, which was subsequently amended
to reflect certain changes, including (i) reference to the addition of the Class
B  Plan and (ii) changes in the  rules of the National Association of Securities
Dealers, Inc. ("NASD"). The Class B Plan was approved by LGT Asset Management as
initial sole shareholder  of the  Class B  shares of  the Health  Care Fund  and
Telecommunications Fund on March 31, 1993. The Class A and Class B Plans for the
(i)  Financial Services Fund, Infrastructure Fund and Natural Resources Fund and
(ii) Consumer  Products and  Services Fund  were approved  by GT  Global as  the
initial  sole shareholder of such Funds' Class A  and Class B shares on April 8,
1994 and December 20, 1994, respectively.

Each Plan requires that,  at least quarterly, the  Directors review the  amounts
expended thereunder and the purposes for which such expenditures were made. Each
Plan  requires that so long  as it is in effect  the selection and nomination of
Directors who are not "interested persons"  of the Company will be committed  to
the discretion of the Directors who are not "interested persons" of the Company,
as defined in the 1940 Act.

As  discussed in the  Prospectus, GT Global  collects sales charges  on sales of
Class A  shares  of each  Fund,  retains certain  amounts  of such  charges  and
reallows  other amounts of such charges  to broker/dealers that sell shares. The
following table  reviews the  extent of  such activity  during the  Health  Care
Fund's   last  three   fiscal  years.  The   sales  structure   for  the  period

                  Statement of Additional Information Page 29
<PAGE>
                             GT GLOBAL THEME FUNDS
January 1, 1993 through March  31, 1993 and for  the fiscal years ended  October
31,  1992 and 1991  was a sales  structure substantially similar  to the current
Class A structure:

<TABLE>
<CAPTION>
                                                                            SALES CHARGES      AMOUNT         AMOUNTS
YEAR ENDED OCTOBER 31,                                                        COLLECTED       RETAINED       REALLOWED
- --------------------------------------------------------------------------  --------------  -------------  --------------
<S>                                                                         <C>             <C>            <C>
1994......................................................................  $    1,544,456  $     131,040  $    1,413,416
1993......................................................................       1,519,000        181,204       1,337,796
1992......................................................................      12,116,000      1,174,340      10,941,660
</TABLE>

The  following  table   reviews  the   extent  of  such   activity  during   the
Telecommunications  Fund's fiscal year  ended October 31, 1994  and 1993 and its
fiscal period January 27, 1992 (commencement of operations) to October 31, 1992:

<TABLE>
<CAPTION>
                                                                            SALES CHARGES      AMOUNT         AMOUNTS
YEAR ENDED OCTOBER 31,                                                        COLLECTED       RETAINED       REALLOWED
- --------------------------------------------------------------------------  --------------  -------------  --------------
<S>                                                                         <C>             <C>            <C>
1994......................................................................  $   15,634,626  $   2,477,493  $   13,157,133
1993......................................................................      18,545,000      2,002,928      16,542,072
1992 (since Fund inception on
 January 27, 1992)........................................................      19,640,000        611,243      19,028,757
</TABLE>

The following  table  reviews  the extent  of  such  activity for  each  of  the
Financial Services Fund, Infrastructure Fund and Natural Resources Fund for each
Fund's  fiscal period May  31, 1994 (commencement of  operations) to October 31,
1994:

<TABLE>
<CAPTION>
                                                                            SALES CHARGES      AMOUNT         AMOUNTS
MAY 31, 1994 TO OCTOBER 31, 1994                                              COLLECTED       RETAINED       REALLOWED
- --------------------------------------------------------------------------  --------------  -------------  --------------
<S>                                                                         <C>             <C>            <C>
Financial Services Fund...................................................  $       53,670  $       4,672  $       48,998
Infrastructure Fund.......................................................         494,689         51,215         443,474
Natural Resources Fund....................................................         203,926         14,471         189,455
</TABLE>

GT  Global  receives   no  compensation  or   reimbursements  relating  to   its
distribution  efforts with respect to the Class A shares other than as described
above. GT  Global  receives  any contingent  deferred  sales  charges  ("CDSCs")
payable  with  respect to  redemptions of  Class B  shares. The  following table
discloses the amount  of CDSCs  collected by  GT Global  with regard  to the  GT
Global Theme Funds for the periods shown.

                                HEALTH CARE FUND

<TABLE>
<CAPTION>
                                                                                                          CDSCS COLLECTED
                                                                                                          ----------------
<S>                                                                                                       <C>
Year ended October 31, 1994.............................................................................   $       49,801
Period April 1, 1993 to October 31, 1993................................................................            2,093
</TABLE>

                            TELECOMMUNICATIONS FUND

<TABLE>
<CAPTION>
                                                                                                          CDSCS COLLECTED
                                                                                                          ----------------
<S>                                                                                                       <C>
Year ended October 31, 1994.............................................................................   $    1,731,244
Period April 1, 1993 to October 31, 1993................................................................           51,513
</TABLE>

                            FINANCIAL SERVICES FUND

<TABLE>
<CAPTION>
                                                                                                          CDSCS COLLECTED
                                                                                                          ----------------
<S>                                                                                                       <C>
May 31, 1994 (commencement of operations) to October 31, 1994...........................................   $          847
</TABLE>

                              INFRASTRUCTURE FUND

<TABLE>
<CAPTION>
                                                                                                          CDSCS COLLECTED
                                                                                                          ----------------
<S>                                                                                                       <C>
May 31, 1994 (commencement of operations) to October 31, 1994...........................................   $        1,528
</TABLE>

                             NATURAL RESOURCES FUND

<TABLE>
<CAPTION>
                                                                                                          CDSCS COLLECTED
                                                                                                          ----------------
<S>                                                                                                       <C>
May 31, 1994 (commencement of operations) to October 31, 1994...........................................   $          779
</TABLE>

                  Statement of Additional Information Page 30
<PAGE>
                             GT GLOBAL THEME FUNDS

TRANSFER AGENCY SERVICES
GT  Services,  the Funds'  Transfer Agent,  has  been retained  by the  Funds to
perform shareholder servicing,  reporting and general  transfer agent  functions
for  the  Funds.  For these  services,  the  Transfer Agent  receives  an annual
maintenance fee of $17.50 per account, a new account fee of $4.00 per account, a
per transaction fee of $1.75 for all transactions other than exchanges and a per
exchange fee of $2.25. The  Transfer Agent is also  reimbursed by the Funds  for
its  out-of-pocket expenses for such items as postage, forms, telephone charges,
stationery and office supplies.

EXPENSES OF THE FUNDS AND OF THE PORTFOLIOS
Each Fund  and  each  Portfolio pays  all  expenses  not assumed  by  LGT  Asset
Management,  GT Global and other agents.  These expenses include, in addition to
the advisory, administration, distribution,  transfer agency and brokerage  fees
discussed  above,  legal and  audit  expenses, custodian  fees,  trustees' fees,
organizational  fees,  fidelity  bond  and  other  insurance  premiums,   taxes,
extraordinary expenses and expenses of reports and prospectuses sent to existing
investors.  Certain of these expenses, such as custodial fees and brokerage fees
generally are higher for non-U.S. securities. The allocation of general  Company
expenses and expenses shared among the Funds and other funds organized as series
of  the Company are allocated on a basis deemed fair and equitable, which may be
based on the  relative net  assets of  the Funds or  the nature  of the  service
performed and relative applicability to the Funds. Expenditures, including costs
incurred  in connection with the purchase or sale of portfolio securities, which
are capitalized  in accordance  with  generally accepted  accounting  principles
applicable  to investment companies, are accounted  for as capital items and not
as expenses. The ratio of each Fund's expenses to its relative net assets can be
expected to  be higher  than the  expense ratios  of funds  investing solely  in
domestic  securities,  since  the cost  of  maintaining the  custody  of foreign
securities and the rate of investment management  fees paid by the Funds or  the
Portfolios  generally  are higher  than the  comparable  expenses of  such other
funds.

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

                            VALUATION OF FUND SHARES

- --------------------------------------------------------------------------------
As described in the Prospectus, each Fund's  net asset value per share for  each
class  of shares  is determined each  day on  which The New  York Stock Exchange
("NYSE") is  open for  business ("Business  Day")  as of  the close  of  regular
trading on the NYSE (currently 4:00 p.m. Eastern Time, unless weather, equipment
failure  or other factors contribute to an earlier closing time). Currently, the
NYSE is  closed  on weekends  and  on certain  days  relating to  the  following
holidays:  New Year's Day, Presidents' Day, Good Friday, Memorial Day, July 4th,
Labor Day, Thanksgiving Day and Christmas Day.

Each Theme Portfolio's securities and other assets are valued as follows:

Equity securities, including  ADRs, ADSs  and EDRs,  which are  traded on  stock
exchanges,  are valued  at the  last sale  price on  the exchange  on which such
securities are traded, as of the close of business on the day the securities are
being valued or, lacking any  sales, at the last  available bid price. In  cases
where securities are traded on more than one exchange, the securities are valued
on  the exchange determined  by LGT Asset  Management to be  the primary market.
Securities traded in the OTC market are valued at the last available sale  price
prior  to the time  of valuation. Securities  and other assets  for which market
quotations are not readily available  (including restricted securities that  are
subject  to limitations as to their sale) are valued at fair value as determined
in good faith by or under the direction of the Portfolios' Board of Trustees  or
the Company's Board of Directors, as applicable.

Long-term  debt obligations are valued at  the mean of representative quoted bid
or asked prices for  such securities or,  if such prices  are not available,  at
prices  for securities of  comparable maturity, quality  and type; however, when
LGT Asset  Management deems  it  appropriate, prices  obtained  for the  day  of
valuation  from a bond pricing service will be used. Short-term debt investments
are amortized to  maturity based on  their cost, adjusted  for foreign  exchange
translation.

Options  on indices, securities and currencies purchased by the Theme Portfolios
are valued at  their last  bid price in  the case  of listed options  or at  the
average of the last bid prices obtained from dealers in the case of OTC options.
The  value of each  security denominated in  a currency other  than U.S. dollars
will be  translated  into  U.S.  dollars at  the  prevailing  exchange  rate  as
determined  by  LGT Asset  Management on  that day.  When market  quotations for
futures and options on futures held by a Theme Portfolio are readily  available,
those positions will be valued based upon such quotations.

                  Statement of Additional Information Page 31
<PAGE>
                             GT GLOBAL THEME FUNDS

Securities  and  other  assets  for  which  market  quotations  are  not readily
available are valued at fair value as  determined in good faith by or under  the
direction  of  the  Portfolios' Board  of  Trustees  or the  Company's  Board of
Directors, as  applicable.  The valuation  procedures  applied in  any  specific
instance  are  likely  to vary  from  case  to case.  However,  consideration is
generally given to the  financial position of the  issuer and other  fundamental
analytical data relating to the investment and to the nature of the restrictions
on disposition of the securities (including any registration expenses that might
be  borne  by the  Theme  Portfolios in  connection  with such  disposition). In
addition, other factors, such as the cost of the investment, the market value of
any unrestricted securities of the same class (both at the time of purchase  and
at  the time of  valuation), the size of  the holding, the  prices of any recent
transactions or  offers  with  respect  to such  securities  and  any  available
analysts' reports regarding the issuer, generally are considered.

The  fair value  of any  other assets is  added to  the value  of all securities
positions to arrive at the  value of each Fund's  total assets (which, for  each
Feeder Fund is the value of its investment in its corresponding Portfolio). Each
Fund's liabilities, including accruals for expenses, are deducted from its total
assets. Once the total value of a Fund's net assets is so determined, that value
is  then divided by  the total number of  shares outstanding (excluding treasury
shares), and the result, rounded to the nearer cent, is the net asset value  per
share.

Any assets or liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the official exchange rate or, alternatively, at
the mean of the current bid and asked prices of such currencies against the U.S.
dollar  last quoted by a major bank that is a regular participant in the foreign
exchange market or on the basis of a pricing service that takes into account the
quotes provided by a number of such  major banks. If none of these  alternatives
are  available or  none are  deemed not  to provide  a suitable  methodology for
converting a  foreign  currency into  U.S.  dollars, the  Portfolios'  Board  of
Trustees or the Company's Board of Directors, as applicable, in good faith, will
establish a conversion rate for such currency.

European,  Far Eastern, or Latin American  securities trading may not take place
on all days on which the NYSE  is open. Further, trading takes place in  various
foreign  markets on days on which the NYSE is not open. Trading in securities on
European and  Far Eastern  securities  exchanges and  OTC markets  generally  is
completed  well  before the  close of  business in  New York.  Consequently, the
calculation  of  each  Fund's  net  asset  value  may  not  always  take   place
contemporaneously  with the  determination of the  prices of  securities held by
each Fund.  Events  affecting  the  values  of  securities  held  by  the  Theme
Portfolios that occur between the time their prices are determined and the close
of  normal trading on the NYSE will not be reflected in a Fund's net asset value
unless LGT Asset  Management, under the  supervision of the  Company's Board  of
Directors  or the Portfolios' Board of  Trustees, as applicable, determines that
the particular event  would materially affect  net asset value.  As a result,  a
Fund's  net asset value  may be significantly  affected by such  trading on days
when a shareholder has no access to that Fund.

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

                         INFORMATION RELATING TO SALES
                                AND REDEMPTIONS

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

PAYMENT AND TERMS OF OFFERING
Payment for Class A or Class B  shares of a Fund purchased should accompany  the
purchase  order, or funds should be wired  to the Transfer Agent as described in
the Prospectus. Payment, other than by wire  transfer, must be made by check  or
money order drawn on a U.S. bank. Checks or money orders must be payable in U.S.
dollars.

As  a condition of this offering, if an order to purchase either class of shares
is canceled due to nonpayment (for example,  on account of a check returned  for
"not  sufficient funds"), the person who made  the order will be responsible for
any loss  incurred by  the Fund  by reason  of such  cancellation, and  if  such
purchaser  is a shareholder, the  Fund shall have the  authority as agent of the
shareholder to redeem  shares in his  or her account  at their then-current  net
asset  value per share  to reimburse the  Fund for the  loss incurred. Investors
whose purchase orders  have been canceled  due to nonpayment  may be  prohibited
from placing future orders.

Each  Fund  reserves the  right at  any time  to waive  or increase  the minimum
requirements applicable to initial or subsequent investments with respect to any
person or class of persons. An order to purchase shares is not binding on a Fund
until it  has  been  confirmed  in  writing by  the  Transfer  Agent  (or  other
arrangements made with the Fund, in the case

                  Statement of Additional Information Page 32
<PAGE>
                             GT GLOBAL THEME FUNDS
of  orders utilizing wire transfer of funds, as described above) and payment has
been received. To protect existing shareholders, each Fund reserves the right to
reject any offer for a purchase of shares by any individual.

SALES OUTSIDE THE UNITED STATES
Sales of Fund shares made through brokers  outside the United States will be  at
net  asset value plus a sales commission,  if any, established by that broker or
by local law;  such a commission,  if any, may  be more or  less than the  sales
charges listed in the sales charge table included in the Prospectus.

AUTOMATIC INVESTMENT PLAN -- CLASS A SHARES AND CLASS B SHARES
To  establish  participation in  the Fund's  Automatic Investment  Plan ("AIP"),
investors or their broker/dealers should  specify whether investment will be  in
Class  A shares or Class B shares and should send the following documents to the
Transfer Agent: (1) an AIP Application; (2) a Bank Authorization Form; and (3) a
voided personal check from the pertinent  bank account. The necessary forms  are
provided  at the back of the Fund's Prospectus. Provided that an investor's bank
accepts the Bank  Authorization Form, investment  amounts will be  drawn on  the
designated dates (monthly on the 25th day or beginning quarterly on the 25th day
of  the  month  the  investor  first selects)  in  order  to  purchase  full and
fractional shares of the  Fund at the public  offering price determined on  that
day.  In the  event that the  25th day falls  on a Saturday,  Sunday or holiday,
shares will be purchased  on the next  business day. If  an investor's check  is
returned because of insufficient funds or a stop payment order or if the account
is closed, the AIP may be discontinued, and any share purchase made upon deposit
of  such check may be cancelled. Furthermore, the shareholder will be liable for
any loss incurred by the Fund  by reason of such cancellation. Investors  should
allow one month for the establishment of an AIP. An AIP may be terminated by the
Transfer  Agent  or  the  Fund  upon  thirty  days'  written  notice  or  by the
participant at any time without penalty, upon written notice to the Fund or  the
Transfer Agent.

LETTER OF INTENT -- CLASS A SHARES
The  Letter  of Intent  ("LOI")  is not  a  binding obligation  to  purchase the
indicated amount. During such time as Class A shares are held in escrow under an
LOI to ensure payment of applicable sales charges if the indicated amount is not
met, all dividends  and capital gain  distributions on escrowed  shares will  be
reinvested  in additional Class A shares shares or paid in cash, as specified by
the shareholder.  If  the  intended  investment  is  not  completed  within  the
specified  thirteen-month  period, the  purchaser must  remit  to GT  Global the
difference between the  sales charge actually  paid and the  sales charge  which
would  have been applicable  if the total Class  A purchases had  been made at a
single time. If this amount  is not paid to GT  Global within twenty days  after
written  request, the appropriate number of escrowed shares will be redeemed and
the proceeds paid to GT Global.

A registered investment adviser,  trust company or  trust department seeking  to
execute  an LOI  as a single  purchaser with  respect to accounts  over which it
exercises investment discretion is required  to provide the Transfer Agent  with
information establishing that it has discretionary authority with respect to the
money  invested (e.g., by providing a  copy of the pertinent investment advisory
agreement). Class A shares purchased in this manner must be registered with  the
Transfer  Agent  so that  only the  investment adviser,  trust company  or trust
department, and  not the  beneficial  owner, will  be  able to  place  purchase,
redemption and exchange orders.

INDIVIDUAL RETIREMENT ACCOUNTS (IRA)
Class  A or Class  B shares of  a Fund may  also be purchased  as the underlying
investment for an IRA meeting the requirements of section 408(a) of the Internal
Revenue Code of 1986, as amended  ("Code"). IRA applications are available  from
brokers or GT Global.

EXCHANGES BETWEEN FUNDS
Shares  of a Fund may  be exchanged for shares of  other GT Global Mutual Funds,
based on  their respective  net asset  values without  imposition of  any  sales
charges  provided that the  registration remains identical. Class  A shares of a
Fund may be exchanged only for Class  A shares of other GT Global Mutual  Funds.
Class  B shares of a Fund  may be exchanged only for  Class B shares of other GT
Global Mutual  Funds.  The exchange  privilege  is not  an  option or  right  to
purchase shares but is permitted under the current policies of the respective GT
Global Mutual Funds. The privilege may be discontinued or changed at any time by
any  of the funds  upon sixty days  prior written notice  to the shareholders of
such fund  and is  available  only in  states where  the  exchange may  be  made
legally.   Before  purchasing  shares  through  the  exercise  of  the  exchange
privilege, a shareholder should obtain and read a copy of the prospectus of  the
fund  to be  purchased and  should consider  the investment  objective(s) of the
fund.

TELEPHONE REDEMPTIONS
A corporation or  partnership wishing to  utilize telephone redemption  services
must  submit a "Corporate Resolution" or "Certificate of Partnership" indicating
the names, titles and the required number of signatures of persons authorized to

                  Statement of Additional Information Page 33
<PAGE>
                             GT GLOBAL THEME FUNDS
act on  its  behalf.  The  certificate  must be  signed  by  a  duly  authorized
officer(s),  and,  in the  case of  a  corporation, the  corporate seal  must be
affixed. All shareholders may request that redemption proceeds be transmitted by
bank wire upon request directly to the shareholder's predesignated account at  a
domestic  bank or savings institution if the proceeds are at least $1,000. Costs
in connection with the administration  of this service, including wire  charges,
currently are borne by that Fund. Proceeds of less than $1,000 will be mailed to
the shareholder's registered address of record. The Funds and the Transfer Agent
reserve  the right to refuse any  telephone instructions and may discontinue the
aforementioned redemption options upon thirty days' written notice.

SYSTEMATIC WITHDRAWAL PLAN
Shareholders owning Class A or Class B shares of a Fund with a value of  $10,000
or  more may  establish a  Systematic Withdrawal Plan  ("SWP"). Under  an SWP, a
shareholder will receive monthly or quarterly  payments, in amounts of not  less
than  $100 per payment, through the automatic redemption of the necessary number
of shares on the designated dates (monthly  on the 25th day or quarterly on  the
25th  day of January, April,  July and October). In the  event that the 25th day
falls on a Saturday, Sunday  or holiday, the redemption  will take place on  the
prior  business day. Certificates, if any, for the shares being redeemed must be
held by  the Transfer  Agent. Checks  will  be made  payable to  the  designated
recipient  and mailed  within seven  days. If  the recipient  is other  than the
registered shareholder, the signature of each shareholder must be guaranteed  on
the  SWP  application  (see  "How  to  Redeem  Shares"  in  the  Prospectus).  A
corporation (or partnership)  must also  submit a  "Corporation Resolution"  (or
"Certificate  of Partnership") indicating  the names, titles,  and signatures of
the individuals authorized to act on its behalf, and the SWP application must be
signed by a duly authorized officer(s) and the corporate seal affixed.

With respect to an SWP  established in Class B  shares only, the maximum  annual
SWP withdrawal is 12% of the initial account value. Withdrawals in excess of 12%
of  the initial account value annually may  result in assessment of a contingent
deferred sales charge. See "How to Invest" in the Prospectus.

Shareholders should be aware that such systematic withdrawals may deplete or use
up  entirely  the  initial  investment  and  result  in  realized  long-term  or
short-term capital gains or losses. The SWP may be terminated at any time by the
Transfer  Agent or the Fund upon thirty days' written notice or by a shareholder
upon written notice to the Fund or its Transfer Agent. Applications and  further
details regarding establishment of an SWP are provided at the back of the Fund's
Prospectus.

SUSPENSION OF REDEMPTION PRIVILEGES
Each  Fund may suspend redemption privileges or postpone the date of payment for
more than seven days after a redemption order is received during any period  (1)
when  the NYSE is closed  other than customary weekend  and holiday closings, or
trading on the NYSE is restricted as directed by the SEC, (2) when an  emergency
exists,  as defined by the SEC, which would prohibit the Funds or the Portfolios
from disposing of portfolio  securities owned by them  or in fairly  determining
the value of its assets, or (3) as the SEC may otherwise permit.

REDEMPTIONS IN KIND
It  is possible  that conditions  may arise  in the  future which  would, in the
opinion of the Company's Board of Directors,  make it undesirable for a Fund  to
pay  for all redemptions in cash. In such cases, the Board may authorize payment
to be  made in  portfolio securities  or other  property of  a Fund,  so  called
"redemptions  in kind." Payment of  redemptions in kind will  be made in readily
marketable securities.  Such  securities  would  be valued  at  the  same  value
assigned  to  them in  computing  the net  asset  value per  share. Shareholders
receiving such  securities  would incur  brokerage  costs in  selling  any  such
securities  so received. However,  despite the foregoing,  the Company has filed
with the SEC an election pursuant to  Rule 18f-1 under the 1940 Act. This  means
that  each  Fund  will pay  in  cash all  requests  for redemption  made  by any
shareholder of record, limited in amount with respect to each shareholder during
any ninety-day period to the lesser of $250,000 or 1% of the net asset value  of
a  Fund at the  beginning of such  period. This election  will be irrevocable so
long as Rule 18f-1 remains in effect,  unless the SEC by order upon  application
permits the withdrawal of such election.

                  Statement of Additional Information Page 34
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     TAXES

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

TAXATION OF THE FUNDS
Each  Fund is treated as a separate corporation for federal income tax purposes.
In order  to  qualify  or continue  to  qualify  for treatment  as  a  regulated
investment  company ("RIC")  under the  Code, each  Fund must  distribute to its
shareholders for  each taxable  year  at least  90%  of its  investment  company
taxable  income (consisting generally  of net investment  income, net short-term
capital  gain  and  net  gains  from  certain  foreign  currency   transactions)
("Distribution Requirement") and must meet several additional requirements. With
respect  to each  Fund, these requirements  include the following:  (1) the Fund
must derive at least 90% of its  gross income each taxable year from  dividends,
interest,  payments with respect to securities loans  and gains from the sale or
other  disposition  of  securities  or  foreign  currencies,  or  other   income
(including  gains  from  options,  Futures or  Forward  Contracts)  derived with
respect to its business of investing in securities or those currencies  ("Income
Requirement");  (2) the Fund must derive less  than 30% of its gross income each
taxable year from the  sale or other  disposition of securities,  or any of  the
following,  that were  held for  less than  three months  -- options  or Futures
(other than those  on foreign  currencies), or foreign  currencies (or  options,
Futures  or  Forward Contracts  thereon) that  are not  directly related  to the
Fund's principal business  of investing  in securities (or  options and  Futures
with respect to securities) ("Short-Short Limitation"); (3) at the close of each
quarter  of the  Fund's taxable  year, at least  50% of  the value  of its total
assets must be represented by cash  and cash items, U.S. government  securities,
securities  of  other RICs  and other  securities,  with these  other securities
limited, in respect of any one issuer, to  an amount that does not exceed 5%  of
the  value of the Fund's total assets and  that does not represent more than 10%
of the issuer's  outstanding voting  securities; and (4)  at the  close of  each
quarter  of the Fund's taxable year, not more than 25% of the value of its total
assets may be invested in securities  (other than U.S. government securities  or
the  securities  of other  RICs)  of any  one issuer.  Each  Feeder Fund,  as an
investor in its corresponding Portfolio, is deemed to own a proportionate  share
of  the Portfolio's assets, and to earn a proportionate share of the Portfolio's
income,  for  purposes  of  determining  whether  the  Fund  satisfies  all  the
requirements described above to qualify as an RIC.

Each Fund will be subject to a nondeductible 4% excise tax ("Excise Tax") to the
extent  it fails to distribute by the end of any calendar year substantially all
of its  ordinary income  for  that year  and capital  gain  net income  for  the
one-year period ending on October 31 of that year, plus certain other amounts.

See  the next section  for a discussion  of the tax  consequences to each Feeder
Fund of  hedging transactions  engaged in,  and investments  in passive  foreign
investment   companies   ("PFICs")  and   other   foreign  securities   by,  its
corresponding Portfolio.

TAXATION OF THE PORTFOLIOS
Each Portfolio  is treated  as a  separate partnership  for federal  income  tax
purposes and is not a "publicly traded partnership." As a result, each Portfolio
is  not subject to federal income tax; instead, each Feeder Fund, as an investor
in its corresponding Portfolio, is required to take into account in  determining
its  federal income  tax liability its  share of the  Portfolio's income, gains,
losses, deductions and credits,  without regard to whether  it has received  any
cash distributions from the Portfolio. Each Portfolio also is not subject to New
York income or franchise tax.

Because, as noted above, each Feeder Fund is deemed to own a proportionate share
of  its corresponding Portfolio's  assets, and to earn  a proportionate share of
its corresponding Portfolio's  income, for purposes  of determining whether  the
Fund satisfies the requirements to qualify as a RIC, each such Portfolio intends
to conduct its operations so that its corresponding Fund will be able to satisfy
all those requirements.

Distributions  to  each Feeder  Fund from  its corresponding  Portfolio (whether
pursuant to a partial  or complete withdrawal or  otherwise) will not result  in
the  Fund's recognition  of any  gain or loss  for federal  income tax purposes,
except that  (1)  gain  will be  recognized  to  the extent  any  cash  that  is
distributed  exceeds  the Fund's  basis for  its  interest in  its corresponding
Portfolio before the distribution, (2) income or gain will be recognized if  the
distribution   is  in  liquidation   of  the  Fund's   entire  interest  in  its
corresponding Portfolio and includes a disproportionate share of any  unrealized
receivables  held  by  the Portfolio,  and  (3)  loss will  be  recognized  if a
liquidation distribution consists solely of cash and/or unrealized  receivables.
Each  Feeder  Fund's  basis  for its  interest  in  its  corresponding Portfolio
generally will equal the

                  Statement of Additional Information Page 35
<PAGE>
                             GT GLOBAL THEME FUNDS
amount of cash and the basis of any property the Fund invests in the  Portfolio,
increased  by  the Fund's  share of  the  Portfolio's net  income and  gains and
decreased by (a) the amount of cash and the basis of any property the  Portfolio
distributes to the Fund and (b) the Fund's share of the Portfolio's losses.

    FOREIGN  TAXES. Dividends and interest received  by a Theme Portfolio may be
subject to income, withholding or other  taxes imposed by foreign countries  and
U.S.  possessions that would reduce the yield on its securities. Tax conventions
between certain countries and  the United States may  reduce or eliminate  these
foreign  taxes,  however, and  many  foreign countries  do  not impose  taxes on
capital gains in respect of investments  by foreign investors. If more than  50%
of  the value of  a Fund's total assets  (taking into account, in  the case of a
Feeder Fund, its proportionate share of its corresponding Portfolio's assets) at
the close of its  taxable year consists of  securities of foreign  corporations,
the  Fund  will be  eligible to,  and may,  file an  election with  the Internal
Revenue Service that  will enable its  shareholders, in effect,  to receive  the
benefit  of the foreign tax credit with respect to any foreign income taxes paid
by it (taking  into account, in  the case  of a Feeder  Fund, its  proportionate
share  of  those taxes  paid by  its corresponding  Portfolio). Pursuant  to the
election, a Fund will  treat those taxes as  dividends paid to its  shareholders
and  each shareholder will be required to (1) include in gross income, and treat
as paid by him, his proportionate share  of those taxes, (2) treat his share  of
those  taxes and of  any dividend paid  by the Fund  that represents income from
foreign sources as his own income from those sources, and (3) either deduct  the
taxes  deemed paid by him in computing his taxable income or, alternatively, use
the foregoing  information in  calculating the  foreign tax  credit against  his
federal income tax. Each Fund will report to its shareholders shortly after each
taxable  year their respective shares of the Fund's income (taking into account,
in the  case of  a Feeder  Fund, its  proportionate share  of its  corresponding
Portfolio's  income) from sources  within, and taxes  paid to, foreign countries
and U.S. possessions if it makes this election.

    PASSIVE FOREIGN INVESTMENT COMPANIES. Each Theme Portfolio may invest in the
stock of PFICs. A PFIC is a  foreign corporation that, in general, meets  either
of  the following tests: (1) at least 75%  of its gross income is passive or (2)
an average of at least 50% of its assets produce, or are held for the production
of, passive  income. Under  certain circumstances,  a Fund  will be  subject  to
federal  income  tax  on  a  part  (or,  in  the  case  of  a  Feeder  Fund, its
proportionate share of a part) of any "excess distribution" received by it  (or,
in  the case of a Feeder Fund, by its corresponding Portfolio) on the stock of a
PFIC or  of any  gain on  the Fund's  (or, in  the case  of a  Feeder Fund,  its
corresponding  Portfolio's)  disposition  of  that  stock  (collectively,  "PFIC
income"), plus interest thereon, even if the Fund distributes the PFIC income as
a taxable dividend to its shareholders. The  balance of the PFIC income will  be
included  in the Fund's investment company taxable income and, accordingly, will
not be  taxable  to  it  to  the  extent  that  income  is  distributed  to  its
shareholders.

If  a  Theme Portfolio  invests in  a PFIC  and elects  to treat  the PFIC  as a
"qualified electing  fund"  ("QEF"), then  in  lieu  of the  foregoing  tax  and
interest  obligation, the Theme Portfolio  (or, in the case  of a Portfolio, its
corresponding Feeder Fund) will be required  to include in income each year  its
pro  rata share of the QEF's annual  ordinary earnings and net capital gain (the
excess of net long-term capital gain over net short-term capital loss) --  which
most  likely would have  to be distributed  by that Theme  Portfolio (or, in the
case of a Portfolio, its corresponding Feeder Fund) to satisfy the  Distribution
Requirement  and to avoid imposition of the Excise Tax -- even if those earnings
and gain were not received thereby. In most instances it will be very difficult,
if not  impossible,  to  make  this election  because  of  certain  requirements
thereof.

The  "Tax Simplification and Technical Corrections  Bill of 1993," passed in May
1994 by the House of Representatives, would substantially modify the taxation of
U.S. shareholders of foreign corporations, including eliminating the  provisions
described  above dealing  with PFICs and  replacing them  (and other provisions)
with  a   regulatory  scheme   involving   entities  called   "passive   foreign
corporations."  Three similar bills were passed by Congress in 1991 and 1992 and
vetoed. It is  unclear at  this time  whether, and  in what  form, the  proposed
modifications will be enacted into law.

Pursuant  to proposed  regulations, open-end RICs,  such as the  Funds, would be
entitled  to  elect   to  "mark-to-market"   their  stock   in  certain   PFICs.
"Marking-to-market," in this context, means recognizing as gain for each taxable
year  the excess, as of the  end of that year, of  the fair market value of each
such  PFIC's  stock   over  the   adjusted  basis  in   that  stock   (including
mark-to-market gain for each prior year for which an election was in effect).

    OPTIONS,  FUTURES AND  FOREIGN CURRENCY TRANSACTIONS.  The Theme Portfolios'
use of hedging transactions,  such as selling  (writing) and purchasing  options
and  Futures and  entering into Forward  Contracts, involves  complex rules that
will determine, for  federal income tax  purposes, the character  and timing  of
recognition  of the  gains and losses  a Theme Portfolio  realizes in connection
therewith. Income from foreign currencies  (except certain gains therefrom  that
may be excluded by future regulations), and income from transactions in options,
Futures  and Forward Contracts derived by a  Theme Portfolio with respect to its
business of  investing in  securities  or foreign  currencies, will  qualify  as
permissible income under the Income Requirement for that Theme Portfolio (or, in
the  case of a  Portfolio, its corresponding Feeder  Fund). However, income from
the disposition by a Theme Portfolio of options and Futures (other than those on
foreign

                  Statement of Additional Information Page 36
<PAGE>
                             GT GLOBAL THEME FUNDS
currencies) will  be  subject  to  the Short-Short  Limitation  for  that  Theme
Portfolio  (or, in the  case of a  Portfolio, its corresponding  Feeder Fund) if
they are held for less than three months. Income from the disposition by a Theme
Portfolio of foreign currencies, and  options, Futures and Forward Contracts  on
foreign  currencies, that are not directly  related to its principal business of
investing in securities (or options and Futures with respect thereto) also  will
be  subject to the Short-Short  Limitation for that Theme  Portfolio (or, in the
case of a Portfolio, its  corresponding Feeder Fund) if  they are held for  less
than three months.

If  a Theme Portfolio satisfies certain requirements, any increase in value of a
position that is part of a "designated hedge" will be offset by any decrease  in
value  (whether realized or  not) of the offsetting  hedging position during the
period of the  hedge for purposes  of determining whether  that Theme  Portfolio
(or,  in the case of  a Portfolio, its corresponding  Feeder Fund) satisfies the
Short-Short Limitation. Thus,  only the net  gain (if any)  from the  designated
hedge  will be included  in gross income  for purposes of  that limitation. Each
Theme Portfolio intends that, when it  engages in hedging transactions, it  will
qualify for this treatment, but at the present time it is not clear whether this
treatment  will be available for  all of those transactions.  To the extent this
treatment is not available, a Theme Portfolio may be forced to defer the closing
out of certain options, Futures, Forward Contracts on foreign currency positions
beyond the time when it otherwise would  be advantageous to do so, in order  for
that  Theme Portfolio (or, in the case  of a Portfolio, its corresponding Feeder
Fund) to qualify or continue to qualify as a RIC.

Futures and  Forward Contracts  that are  subject to  section 1256  of the  Code
(other  than  those  that  are  part  of  a  "mixed  straddle")  ("Section  1256
Contracts") and that are  held by a  Theme Portfolio at the  end of its  taxable
year  generally will  be deemed to  have been  sold at market  value for federal
income tax purposes. Sixty percent of any  net gain or loss recognized on  these
deemed  sales, and 60% of any net gain or loss realized from any actual sales of
Section 1256 Contracts, will be treated  as long-term capital gain or loss,  and
the  balance will be treated as short-term  capital gain or loss. Section 988 of
the Code  also  may  apply to  gains  or  losses from  transactions  in  foreign
currencies,  foreign-currency-denominated debt  securities and  options, Futures
and Forward  Contracts on  foreign currencies.  Each section  988 gain  or  loss
generally  is computed separately and treated as ordinary income or loss. In the
case of overlap between sections 1256 and 988, special provisions determine  the
character  and timing of any income, gain or loss. Each Theme Portfolio attempts
to monitor Section 988 transactions to minimize any adverse tax impact.

TAXATION OF THE FUNDS' SHAREHOLDERS
Dividends and  other  distributions  declared  by a  Fund  in,  and  payable  to
shareholders  of record as  of a date  in, October, November  or December of any
year will  be  deemed  to have  been  paid  by  the Fund  and  received  by  the
shareholders  on December 31 of  that year if the  distributions are paid by the
Fund during  the following  January. Accordingly,  those distributions  will  be
taxed to shareholders for the year in which that December 31 falls.

A  portion  of the  dividends from  a Fund's  investment company  taxable income
(whether paid in cash  or reinvested in additional  shares) may be eligible  for
the  dividends-received deduction allowed to  corporations. The eligible portion
may not exceed the aggregate dividends received by a Fund (directly or through a
Portfolio) from U.S.  corporations. However, dividends  received by a  corporate
shareholder  and deducted by it pursuant to the dividends-received deduction may
be subject indirectly to the alternative minimum tax.

If Fund shares are sold at a loss  after being held for six months or less,  the
loss  will be treated as  long-term, instead of short-term,  capital loss to the
extent of any  capital gain  distributions received on  those shares.  Investors
also should be aware that if shares are purchased shortly before the record date
for  any dividend or other distribution, the shareholder will pay full price for
the shares and receive some portion of the price back as a taxable distribution.

Dividends paid by a  Fund to a shareholder  who, as to the  United States, is  a
nonresident  alien  individual  or nonresident  alien  fiduciary of  a  trust or
estate, foreign corporation or foreign partnership ("foreign shareholder")  will
be  subject to  U.S. withholding tax  (at a rate  of 30% or  lower treaty rate).
Withholding will not apply if a dividend paid by a Fund to a foreign shareholder
is "effectively connected  with the  conduct of a  U.S. trade  or business,"  in
which  case the  reporting and  withholding requirements  applicable to domestic
shareholders will apply. Distributions  of net capital gain  are not subject  to
withholding, but in the case of a foreign shareholder who is a nonresident alien
individual, those distributions ordinarily will be subject to U.S. income tax at
a  rate of 30% (or lower treaty rate) if the individual is physically present in
the United  States for  more  than 182  days during  the  taxable year  and  the
distributions  are attributable to  a fixed place of  business maintained by the
individual in the United States.

The foregoing is a general and abbreviated summary of certain federal income tax
considerations affecting  the  Funds,  their shareholders  and  the  Portfolios.
Investors  are  urged  to  consult  their own  tax  advisers  for  more detailed
information and for  information regarding  any foreign, state  and local  taxes
applicable to distributions received from a Fund.

                  Statement of Additional Information Page 37
<PAGE>
                             GT GLOBAL THEME FUNDS

                             ADDITIONAL INFORMATION

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

LIECHTENSTEIN GLOBAL TRUST
Liechtenstein  Global Trust,  formerly BIL  GT Group,  is composed  of LGT Asset
Management  and  its  worldwide   affiliates.  Other  worldwide  affiliates   of
Liechtenstein  Global Trust include LGT Bank  in Liechtenstein, formerly Bank in
Liechtenstein, an international financial services institution founded in  1920.
LGT  Bank in  Liechtenstein has principal  offices in  Vaduz, Liechtenstein. Its
subsidiaries currently  include LGT  Bank in  Liechtenstein (Deutschland)  GmbH,
formerly  Bank in Liechtenstein  (Frankfurt) GmbH, and  LGT Asset Management AG,
formerly Bilfinanz and Verwaltung AG, in Zurich, Switzerland.

Worldwide  asset  management  affiliates   also  currently  include  LGT   Asset
Management  PLC, formerly  G.T. Management PLC  in London;  LGT Asset Management
Ltd., formerly G.T. Management  (Asia) Ltd. in Hong  Kong; LGT Investment  Trust
Management Ltd., formerly G.T. Management (Japan) in Tokyo; LGT Asset Management
Pte. Ltd., formerly G.T. Management (Singapore) PTE Ltd. in Singapore; LGT Asset
Management  Ltd., formerly G.T. Management (Australia)  Ltd., in Sydney; and LGT
Asset Management GmbH, formerly BIL Asset Management GmbH, located in Frankfurt.

THE COMPANY
The Company was organized as a  Maryland corporation on October 29, 1987.  Until
April 28, 1989, the name of the Company was G.T. Global Income Series, Inc. From
time  to time, the  Company may establish  other funds, each  corresponding to a
distinct investment  portfolio and  a distinct  series of  the Company's  common
stock.

CUSTODIAN
State  Street  Bank and  Trust Company  ("State  Street"), 225  Franklin Street,
Boston, Massachusetts 02110, acts as custodian of the Theme Portfolios'  assets.
State Street is authorized to establish and has established separate accounts in
foreign currencies and to cause securities of the Theme Portfolios to be held in
separate accounts outside the United States in the custody of non-U.S. banks.

INDEPENDENT ACCOUNTANTS
The  Company's  and Global  Investment  Portfolio's independent  accountants are
Coopers & Lybrand, L.L.P., One Post Office Square, Boston, Massachusetts  02109.
Coopers  & Lybrand,  L.L.P. conducts  annual audits  of the  Portfolios' and the
Funds' financial statements, assists in the preparation of each Portfolio's  and
each  Fund's federal and state income tax  returns and consults with the Company
and Global Investment Portfolio as to matters of accounting, regulatory filings,
and federal and state income taxation.

The audited financial statements  of the Company included  in this Statement  of
Additional  Information  have been  examined by  Coopers  & Lybrand,  L.L.P., as
stated in their opinion appearing herein, and is included in reliance upon  such
opinion  given upon  the authority  of said  firm as  experts in  accounting and
auditing.

USE OF NAME
LGT Asset Management has granted the Company  the right to use the "GT" and  "GT
Global"  names and has reserved the right to  withdraw its consent to the use of
such names by the Company at any time, or to grant the use of such names to  any
other company.

                  Statement of Additional Information Page 38
<PAGE>
                             GT GLOBAL THEME FUNDS

                               INVESTMENT RESULTS

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

Each  Fund's "Standardized Return," as referred to in the Prospectus (see "Other
Information --  Performance  Information"  in  the  Prospectus),  is  calculated
separately for Class A and Class B shares of each Fund, as follows: Standardized
Return ("T") is computed by using the value at the end of the period ("EV") of a
hypothetical  initial investment  of $1,000 ("P")  over a period  of years ("n")
according to the following formula as required  by the SEC: P(1+T)(n) = EV.  The
following  assumptions will be reflected in computations made in accordance with
this formula: (1) for Class  A shares deduction of  the maximum sales charge  of
4.75%  from the $1,000 initial investment; (2)  for Class B shares, deduction of
the applicable contingent deferred sales charge imposed on a redemption of Class
B  shares  held  for  the  period;  (3)  reinvestment  of  dividends  and  other
distributions  at net  asset value  on the  reinvestment date  determined by the
Board; and (4) a complete redemption at  the end of any period illustrated.  The
Standardized   Returns  for  the  Class  A   shares  of  Health  Care  Fund  and
Telecommunications Fund,  stated as  average annualized  total returns  for  the
periods shown, were as follows:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................        4.88%
January 27, 1992 through October 31, 1994.............................................................       n/a
November 1, 1989 through October 31, 1994.............................................................       10.39%
August 7, 1989 through October 31, 1994...............................................................        10.63  %

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         1.94%

January 27, 1992 through October 31, 1994.............................................................        16.61%

November 1, 1989 through October 31, 1994.............................................................        n/a

August 7, 1989 through October 31, 1994...............................................................      n/a

</TABLE>

The  Standardized Returns  for the Class  B Shares  of the Health  Care Fund and
Telecommunications Fund,  which were  first  offered April  1, 1993,  stated  as
aggregate returns for the periods shown, were:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................        4.55%
April 1, 1993 through October 31, 1993................................................................       12.84%

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         1.50%

April 1, 1993 through October 31, 1993................................................................        22.39%

</TABLE>

As  discussed  in the  Prospectus, each  Fund  may quote  Non-Standardized Total
Returns that  do  not reflect  the  effect of  sales  charges.  Non-Standardized
Returns  may  be  quoted  for  the same  or  different  time  periods  for which
Standardized Returns are quoted.  The Non-Standardized Returns  for the Class  A
shares  of the Health Care Fund and Telecommunications Fund, stated as aggregate
total returns for the periods shown, were:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................       10.11%
January 27, 1992 through October 31, 1994.............................................................       n/a
August 7, 1989 through October 31, 1994...............................................................       78.16%

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         7.02%

January 27, 1992 through October 31, 1994.............................................................        60.50%

August 7, 1989 through October 31, 1994...............................................................        n/a

</TABLE>

The Non-Standardized Returns for the Class B shares of the Health Care Fund  and
Telecommunications  Fund, which were  first offered on April  1, 1993, stated as
aggregate total returns for the periods shown, were:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................        9.55%
April 1, 1993 through October 31, 1993................................................................       25.07%

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         6.50%

April 1, 1993 through October 31, 1993................................................................        41.70%

</TABLE>

The Non-Standardized Returns for the Class A shares of the Health Care Fund  and
Telecommunications  Fund,  stated as  average annualized  total returns  for the
periods shown, were as follows:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................       10.11%
January 27, 1992 through October 31, 1994.............................................................       n/a
November 1, 1989 through October 31, 1994.............................................................       11.47%
August 7, 1989 through October 31, 1994...............................................................        11.66  %

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         7.02%

January 27, 1992 through October 31, 1994.............................................................        18.69%

November 1, 1989 through October 31, 1994.............................................................        n/a

August 7, 1989 through October 31, 1994...............................................................      n/a

</TABLE>

                  Statement of Additional Information Page 39
<PAGE>
                             GT GLOBAL THEME FUNDS

The Non-Standardized Returns for the Class B shares of the Health Care Fund  and
Telecommunications  Fund,  stated as  average annualized  total returns  for the
periods shown, were as follows:
<TABLE>
<CAPTION>
                                                                                                         HEALTH CARE
PERIOD                                                                                                      FUND
- ------------------------------------------------------------------------------------------------------  -------------
<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................        9.55%
April 1, 1993 through October 31, 1993................................................................       15.18%

<CAPTION>
                                                                                                         TELECOMMUNI-

PERIOD                                                                                                   CATIONS FUND

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

<S>                                                                                                     <C>
Fiscal year ended October 31, 1994....................................................................         6.50%

April 1, 1993 through October 31, 1993................................................................        24.62%

</TABLE>

The Financial  Services Fund,  Infrastructure Fund  and Natural  Resources  Fund
Standardized Returns for their Class A shares, stated as aggregate total returns
at October 31, 1994, were as follows:
<TABLE>
<CAPTION>
                                                                               FINANCIAL SERVICES    INFRASTRUCTURE
PERIOD                                                                                FUND                FUND
- -----------------------------------------------------------------------------  -------------------  -----------------
<S>                                                                            <C>                  <C>
May 31, 1994 through October 31, 1994........................................         (3.17 )%              3.92%

<CAPTION>
                                                                                 NATURAL RESOURCES
PERIOD                                                                                 FUND
- -----------------------------------------------------------------------------  ---------------------
<S>                                                                            <C>
May 31, 1994 through October 31, 1994........................................            3.42%
</TABLE>

The  Financial  Services Fund,  Infrastructure Fund  and Natural  Resources Fund
Standardized Returns for their Class B shares, stated as aggregate total returns
at October 31, 1994, were as follows:
<TABLE>
<CAPTION>
                                                                               FINANCIAL SERVICES   INFRASTRUCTURE
PERIOD                                                                                FUND               FUND
- -----------------------------------------------------------------------------  -------------------  ---------------
<S>                                                                            <C>                  <C>
May 31, 1994 through October 31, 1994........................................         (3.51 )%             3.92%

<CAPTION>
                                                                                NATURAL RESOURCES
PERIOD                                                                                FUND
- -----------------------------------------------------------------------------  -------------------
<S>                                                                            <C>
May 31, 1994 through October 31, 1994........................................           3.31%
</TABLE>

The Non-Standardized Returns for the Class A shares of Financial Services  Fund,
Infrastructure  Fund  and  Natural  Resources Fund,  stated  as  aggregate total
returns at October 31, 1994, were as follows:
<TABLE>
<CAPTION>
                                                                               FINANCIAL SERVICES    INFRASTRUCTURE
PERIOD                                                                                FUND                FUND
- -----------------------------------------------------------------------------  -------------------  -----------------
<S>                                                                            <C>                  <C>
May 31, 1994 through October 31, 1994........................................          1.66 %               9.10%

<CAPTION>
                                                                                 NATURAL RESOURCES
PERIOD                                                                                 FUND
- -----------------------------------------------------------------------------  ---------------------
<S>                                                                            <C>
May 31, 1994 through October 31, 1994........................................            8.57%
</TABLE>

The Non-Standardized Returns for the Class B shares of Financial Services  Fund,
Infrastructure  Fund  and  Natural  Resources Fund,  stated  as  aggregate total
returns at October 31, 1994, were as follows:
<TABLE>
<CAPTION>
                                                                               FINANCIAL SERVICES    INFRASTRUCTURE
PERIOD                                                                                FUND                FUND
- -----------------------------------------------------------------------------  -------------------  -----------------
<S>                                                                            <C>                  <C>
May 31, 1994 through October 31, 1994........................................          1.49 %               8.92%

<CAPTION>
                                                                                 NATURAL RESOURCES
PERIOD                                                                                 FUND
- -----------------------------------------------------------------------------  ---------------------
<S>                                                                            <C>
May 31, 1994 through October 31, 1994........................................            8.31%
</TABLE>

Standardized Returns  and Non-Standardized  Returns are  not presented  for  the
Advisor Class shares because no shares of that class were outstanding during the
fiscal year ended October 31, 1994.

Each Fund's investment results will vary from time to time depending upon market
conditions,  the composition of each Fund's  portfolio and operating expenses of
each Fund,  so  that  current or  past  yield  or total  return  should  not  be
considered  representative of what  an investment in  each Fund may  earn in any
future period. These  factors and possible  differences in the  methods used  in
calculating  investment results should be  considered when comparing each Fund's
investment results with those published for other investment companies and other
investment vehicles. Each Fund's results  also should be considered relative  to
the  risks associated with  such Fund's investment  objective and policies. Each
Fund will  include  performance  data  for  all classes  of  that  Fund  in  any
advertisement or information including performance data for each Fund.

IMPORTANT POINTS TO NOTE ABOUT THE FOLLOWING WORLD FINANCIAL AND ECONOMIC DATA
Information  is  based on  sources believed  to  be reliable,  but which  may be
subject to revision and which has not been independently verified by the Company
or GT  Global.  The authors  and  publishers of  such  material are  not  to  be
considered  as "experts"  under the  Securities Act of  1933, on  account of the
inclusion of such information herein.

A portion of the  performance figures for each  market includes the positive  or
negative effects of the currency exchange rates effective at December 31 of each
year  between the U.S. dollar and currency  of the foreign market (e.g. Japanese
Yen, German  Deutschemark,  Hong Kong  Dollar).  A foreign  currency  which  has
strengthened  or weakened against the U.S.  dollar will positively or negatively
affect the reported returns, as the case may be.

GT Global believes that this information may be useful to investors  considering
whether  and to what extent to  diversify their investments through the purchase
of mutual funds investing in securities on a global basis. However, this data is
not a representation of the past performance of any of these Funds, nor is it  a
prediction  of such performance.  The performance of the  Funds will differ from
the historical performance of the indices represented above. The performance  of
indices  does not take expenses into account, while each Fund incurs expenses in
its operations, which will  reduce performance. Each  Fund is actively  managed,
I.E.,  LGT  Asset  Management,  as  each  Fund's  investment  manager,  actively
purchases and sells

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                             GT GLOBAL THEME FUNDS
securities in seeking each Fund's investment objective. Moreover, each Fund  may
invest  a portion of its assets in corporate bonds, while the below data relates
only to government bonds.  Each of these factors  will cause the performance  of
each Fund to differ from the indices shown below.

Each  Fund  and GT  Global  may from  time  to time  compare  the Fund  with the
following:

        (1) The Salomon Brothers Non-U.S. Dollars Indices, which are measures of
    the total return  performance of  high quality  non-U.S. dollar  denominated
    securities in major sectors of the worldwide bond markets.

        (2) The Shearson Lehman Hutton Government/Corporate Bond Index, which is
    a  comprehensive  measure of  all public  obligations  of the  U.S. Treasury
    (excluding flower bonds  and foreign targeted  issues), all publicly  issued
    debt   of  agencies  of  the  U.S.  Government  (excluding  mortgage  backed
    securities), and all  public, fixed rate,  non-convertible investment  grade
    domestic  corporate debt  rated at least  Baa by  Moody's Investors Service,
    Inc. ("Moody's") or BBB by Standard and Poor's Ratings Group ("S&P"), or, in
    the case  of  nonrated bonds,  BBB  by Fitch  Investors  Service  (excluding
    collateralized mortgage obligations).

        (3)  The Consumer Price Index, which is  a measure of the average change
    in prices over time in  a fixed market basket  of goods and services  (e.g.,
    food,  clothing, shelter, fuels, transportation  fares, charges for doctors'
    and dentists' services, prescription medicines, and other goods and services
    that people buy for day-to-day living).  There is inflation risk which  does
    not  affect a  security's value  but its purchasing  power i.e.  the risk of
    changing price levels  in the economy  that affects security  prices or  the
    price of goods and services.

        (4)  Data  and  mutual fund  rankings  published or  prepared  by Lipper
    Analytical  Data  Services,  Inc.  ("Lipper"),  CDA/Wiesenberger  Investment
    Company   Services  ("CDA/Wiesenberger"),  Morningstar,  Inc.  and/or  other
    companies that  rank and/or  compare mutual  funds by  overall  performance,
    investment  objectives, assets, expense levels,  periods of existence and/or
    other factors. In this regard each Fund may be compared to the Fund's  "peer
    group"  as  defined by  Lipper,  CDA/Wiesenberger, Morningstar  and/or other
    firms, as applicable,  or to  specific funds or  groups of  funds within  or
    outside  of such peer  group. Lipper generally  ranks funds on  the basis of
    total return,  assuming reinvestment  of distributions,  but does  not  take
    sales charges or redemption fees into consideration, and is prepared without
    regard  to tax  consequences. In addition  to the mutual  fund rankings, the
    Fund's performance  may  be  compared to  mutual  fund  performance  indices
    prepared  by Lipper. Morningstar  is a mutual fund  rating service that also
    rates mutual funds  on the basis  of risk-adjusted performance.  Morningstar
    ratings are calculated from a fund's three, five and ten year average annual
    returns  with appropriate  fee adjustments and  a risk  factor that reflects
    fund performance  relative to  the three-month  U.S. Treasury  bill  monthly
    returns.  Ten percent  of the funds  in an investment  category receive five
    stars and 22.5% receive four stars.  The ratings are subject to change  each
    month.

        (5)  Bear  Stearns Foreign  Bond  Index, which  provides  simple average
    returns for individual countries and GNP-weighted index, beginning in  1975.
    The returns are broken down by local market and currency.

        (6)  Ibbottson  Associates International  Bond  Index, which  provides a
    detailed breakdown of local market and currency returns since 1960.

        (7) Standard & Poor's 500 Composite Stock Price Index which is a  widely
    recognized  index  composed of  the  capitalization-weighted average  of the
    price of 500 of the largest publicly traded stocks in the United States.

        (8) Salomon Brothers Broad Investment Grade Index which is a widely used
    index composed of  U.S. domestic government,  corporate and  mortgage-backed
    fixed income securities.

        (9) Dow Jones Industrial Average.

       (10) CNBC/Financial News Composite Index.

       (11) Morgan Stanley Capital International World Indices, including, among
    others, the Morgan Stanley Capital International Europe, Australia, Far East
    Index  ("EAFE Index").  The EAFE  index is an  unmanaged index  of more than
    1,000 companies of Europe, Australia and the Far East.

       (12) Salomon Brothers  World Government Bond  Index and Salomon  Brothers
    World  Government Bond Index-Non-U.S. are each  a widely used index composed
    of world government bonds.

       (13) The World Bank Publication of Trends in Developing Countries (TIDE).
    TIDE provides brief reports on most  of the World Bank's borrowing  members.
    The  World Development Report is published  annually and looks at global and
    regional  economic  trends  and   their  implications  for  the   developing
    economies.

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                             GT GLOBAL THEME FUNDS

       (14)  Salomon  Brothers Global  Telecommunications  Index is  composed of
    telecommunications companies in the developing and emerging countries.

       (15) Datastream  and Worldscope  each is  an on-line  database  retrieval
    service  for  information  including,  but  not  limited  to,  international
    financial and economic data.

       (16)  International  Financial  Statistics,  which  is  produced  by  the
    International Monetary Fund.

       (17)  Various publications and annual reports, produced by the World Bank
    and its affiliates.

       (18) Various publications from the International Bank for  Reconstruction
    and Development.

       (19)  Various publications including, but not limited to ratings agencies
    such as Moody's  Investors Services, Inc.,  Fitch Investor's Service,  Inc.,
    Standard & Poor's Ratings Group.

       (20)  Wilshire Associates which is  an on-line database for international
    financial and economic data including  performance measure for a wide  range
    of securities.

       (21)  Bank Rate  National Monitor Index,  which an average  of the quoted
    rates for 100 leading banks and thrifts in ten U.S. cities.

       (22) International Finance Corporation  (IFC) Emerging Markets Data  Base
    which  provides detailed statistics on stock  and bond markets in developing
    countries.

       (23) Various publications from the Organization for Economic  Cooperation
    and Development ("OECD").

       (24)  Average of  Savings Accounts,  which is a  measure of  all kinds of
    savings deposits,  including  longer-term  certificates  (based  on  figures
    supplied by the U.S. League of Savings Institutions). Savings accounts offer
    a  guaranteed rate  of return on  principal, but no  opportunity for capital
    growth. During  a portion  of the  period, the  maximum rates  paid on  some
    savings deposits were fixed by law.

Indices,  economic and  financial data prepared  by the  research departments of
such financial organizations as Salomon Brothers, Inc., Lehman Brothers, Merrill
Lynch, Pierce, Fenner & Smith, Inc., J. P. Morgan, Morgan Stanley, Smith  Barney
Shearson,  S.G.  Warburg, Jardine  Flemming,  Barings Securities,  The  Bank for
International  Settlements,  Asian  Development   Bank,  Bloomberg,  L.P.,   and
Ibbottson Associates may be used, as well as information reported by the Federal
Reserve  and the  respective Central Banks  of various nations.  In addition, GT
Global  may   use  performance   rankings,  ratings   and  commentary   reported
periodically  in national financial  publications, including but  not limited to
Money Magazine, Smart Money, Global Finance, EuroMoney, Financial World, Forbes,
Fortune, Business Week, Latin Finance, the Wall Street Journal, Emerging Markets
Weekly, Kiplinger's Guide  To Personal Finance,  Barron's, The Financial  Times,
USA  Today, The New York  Times, Far Eastern Economic  Review, The Economist and
Investors Business Digest.  Each Fund  may compare  its performance  to that  of
other  compilations or indices  of comparable quality to  those listed above and
other indices which may be developed and made available in the future.

From time  to  time,  each Fund  and  GT  Global  may refer  to  the  number  of
shareholders  in the  Funds or  the aggregate number  of shareholders  in all GT
Global Mutual Funds or the dollar amount of each Fund's assets under  management
or  rankings by  DALBAR Surveys,  Inc. with  respect to  mutual fund shareholder
services in advertising materials.

GT Global  believes  each  Fund  is  an  appropriate  investment  for  long-term
investment  goals including, but  not limited to  funding retirement, paying for
education or purchasing a house. GT  Global may provide information designed  to
help individuals understand their investment goals and explore various financial
strategies. For example, GT Global may describe general principles of investing,
such as asset allocation, diversification and risk tolerance. Each Fund does not
represent  a complete investment program and  the investors should consider each
Fund as appropriate  for a portion  of their overall  investment portfolio  with
regard  to their long-term investment goals. There is no assurance that any such
information will lead to achieving these goals or guarantee future results.

From time to time,  GT Global may refer  to or advertise the  names of U.S.  and
non-U.S.  companies and their  products although there can  be no assurance that
any GT Global Mutual Fund may own the securities of these companies.

Ibbotson Associates of Chicago, Illinois (Ibbotson) provides historical  returns
of  the capital  markets in  the United  States, including  common stocks, small
capitalization stocks, long-term  corporate bonds, intermediate-term  government
bonds,  long-term government bonds,  Treasury bills, the  U.S. rate of inflation
(based on the CPI), and combinations of various capital markets. The performance
of these capital markets are based on the returns of different indices.

                  Statement of Additional Information Page 42
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                             GT GLOBAL THEME FUNDS

GT Global Mutual Funds may use the performance of these capital markets in order
to demonstrate  general  risk-versus-reward  investment  scenarios.  Performance
comparisons  may also include the  value of a hypothetical  investment in any of
these capital  markets. The  risks associated  with the  security types  in  any
capital  market  may or  may  not correspond  directly  to those  of  the funds.
Ibbotson calculates total returns in the same method as the funds. The funds may
also compare performance to  that of other compilations  or indices that may  be
developed and made available in the future.

Each  Fund may  quote various measures  of volatility  and benchmark correlation
such as beta, standard deviation and R(2) in advertising. In addition, each Fund
may compare these measures to those of other funds. Measures of volatility  seek
to  compare each  Fund's historical  share price  fluctuations or  total returns
compared to those of a benchmark. All measures of volatility and correlation are
calculated using averages of historical data.

Each Fund may advertise  examples of the effects  of periodic investment  plans,
including the principle of dollar cost averaging programs. In such a program, an
investor  invests a fixed dollar amount in a fund at periodic intervals, thereby
purchasing fewer shares  when prices are  high and more  shares when prices  are
low.  While such a strategy does not assure  a profit or guard against loss in a
declining market, the  investor's average cost  per share can  be lower than  if
fixed  numbers of shares are purchased at the same intervals. In evaluating such
a plan, investors should  consider their ability  to continue purchasing  shares
through periods of low price levels.

Each  Fund  may be  available  for purchase  through  retirement plans  of other
programs offering deferral of or exemption from income taxes, which may  produce
superior  after tax returns over time. For example, a $10,000 investment earning
a taxable return of 10% annually would have an after-tax value of $17,976  after
ten  years, assuming tax was deducted from the return each year at a 39.6% rate.
An equivalent tax-deferred investment would  have an after-tax value of  $19,626
after  ten years, assuming  tax was deducted  at a 39.6%  rate from the deferred
earnings at the end of the ten-year period.

Each Fund may describe in its sales material and advertisements how an  investor
may invest in the GT Global Mutual Funds through various retirement accounts and
plans  that offer deferral of  income taxes on investment  earnings and may also
enable an investor to make  pre-tax contributions. Because of their  advantages,
these  retirement accounts and plans may  produce returns superior to comparable
non-retirement investments. The Funds may also discuss these accounts and plans,
which include:

INDIVIDUAL RETIREMENT ACCOUNTS (IRAS): Any individual who receives earned income
from employment (including  self-employment) can  contribute up  to $2,000  each
year  to an  IRA (or,  if less,  100% of  compensation). If  your spouse  is not
employed, a total of $2,250 may be contributed each year to IRAs set up for  you
and  your  spouse  (subject  to  the maximum  of  $2,000  to  either  IRA). Some
individuals may be able  to take an income  tax deduction for the  contribution.
Regular  contributions  may  not be  made  for the  year  you become  70  1/2 or
thereafter. Please consult your tax advisor for more information.

ROLLOVER IRAS: Individuals who  receive distributions from qualified  retirement
plans  (other than  required distributions) and  who wish to  keep their savings
growing tax-deferred  can  roll  over  (or make  a  direct  transfer  of)  their
distribution  to a  Rollover IRA. These  accounts can also  receive rollovers or
transfers from an existing IRA. If  an "eligible roll over distribution" from  a
qualified  employer-sponsored retirement plan is not  directly rolled over to an
IRA (or  certain  qualified plans),  withholding  at the  rate  of 20%  will  be
required  for federal income tax purposes.  A distribution from a qualified plan
that is not an "eligible roll over distribution," including a distribution  that
is  one  of a  series  of substantially  equal  periodic payments,  generally is
subject to regular wage withholding or withholding at the rate of 10% (depending
on the type and amount  of the distribution), unless you  elect not to have  any
withholding apply. Please consult your tax advisor for more information.

SEP-IRAS  AND SALARY-REDUCTION SEP-IRAS: Simplified employee pension (SEP) plans
and salary-reduction SEPs  provide self-employed individuals  (and any  eligible
employees)  with benefits similar to Keogh-type  plans or 401(k) plans, but with
fewer  administrative  requirements   and  therefore   potential  lower   annual
administration expenses.

403(B)(7)  CUSTODIAL  ACCOUNTS:  Employees  of  public  schools  and  most other
not-for-profit organizations can make pre-tax salary reduction contributions  to
these accounts.

PROFIT-SHARING (INCLUDING 401(K)) AND MONEY PURCHASE PENSION PLANS: Corporations
can  sponsor these qualified  defined contribution plans  for their employees. A
401(k) plan, a type of  profit-sharing plan, additionally permits the  eligible,
participating  employees to make  pre-tax salary reduction  contributions to the
plan (up to certain limitations).

GT Global may from time to time  in its sales materials and advertising  discuss
the  risks inherent in investing. The major  types of investment risk are market
risk, industry risk, credit  risk, interest rate risk  and inflation risk.  Risk
represents the

                  Statement of Additional Information Page 43
<PAGE>
                             GT GLOBAL THEME FUNDS
possibility  that you may lose  some or all of your  investment over a period of
time. A  basic tenet  of investing  is  the greater  the potential  reward,  the
greater the risk.

From  time to time,  the Funds and  GT Global will  quote certain data regarding
industries, individual countries, regions,  world stock exchanges, and  economic
and  demographic statistics from sources GT Global deems reliable, including but
not limited to, the economic and  financial data of such financial  organization
as:

 1) Stock  market  capitalization:  Morgan Stanley  Capital  International World
    Indices, International Finance Corporation and Datastream.

 2) Stock market  trading volume:  Morgan  Stanley Capital  International  World
    Indices, International Finance Corporation.

 3) The  number of listed companies: International Finance Corporation, GT Guide
    to World Equity Markets,  Salomon Brothers, Inc.,  S.G. Warburg and  Barings
    Securities.

 4) Wage  rates: U.S. Department of Labor  Statistics and Morgan Stanley Capital
    International World.

 5) International industry  performance:  Morgan Stanley  Capital  International
    World Indices, Wilshire Associates and Salomon Brothers, Inc.

 6) Stock   market  performance:  Morgan  Stanley  Capital  International  World
    Indices, International Finance Corporation and Datastream.

 7) The Consumer Price Index and inflation rate: The World Bank, Datastream  and
    International Finance Corporation.

 8) Gross Domestic Product ("GDP"): Datastream and The World Bank.

 9) GDP  growth  rate: International  Finance  Corporation, The  World  Bank and
    Datastream.

10) Population: The World Bank, Datastream and United Nations.

11) Average annual growth rate (%) of population: The World Bank, Datastream and
    United Nations.

12) Age distribution within populations: OECD and United Nations.

13) Total exports and  imports by year:  International Finance Corporation,  The
    World Bank and Datastream.

14) Top three companies by country or market: International Finance Corporation,
    GT  Guide to World  Equity Markets, Salomon Brothers  Inc., S.G. Warburg and
    Barings Securities.

15) Foreign direct  investments  to developing  countries:  The World  Bank  and
    Datastream.

16) Supply,  consumption,  demand  and  growth in  demand  of  certain products,
    services and industries, including, but  not limited to electricity,  water,
    transportation,   construction   materials,  natural   resources,  financial
    services, health care services and supplies, consumer products and  services
    and  telecommunications equipment and services  (sources of such information
    may include,  but  would not  be  limited to,  The  World Bank,  OECD,  IMF,
    Bloomberg and Datastream).

17) Standard  deviation and performance returns for U.S. and non-U.S. equity and
    bond markets: Morgan Stanley Capital International.

18) Countries restructuring their  debt, including those  under the Brady  Plan:
    G.T. Capital Management, Inc.

19) Political and economic structure of countries: Economist Intelligence Unit.

20) Government  and corporate  bonds --  credit ratings,  yield to  maturity and
    performance returns: Salomon Brothers, Inc.

21) Dividend yields for U.S. and non-U.S. companies: Bloomberg.

From time  to  time,  GT Global  may  include  in its  advertisement  and  sales
material, information about privatization which is an economic process involving
the sale of state-owned companies to the private sector.

In  advertising and sales materials, GT Global  may make reference to or discuss
its products, services and accomplishments. Among these accomplishments are that
in 1983 GT Global provided assistance to the government of Hong Kong in  linking
its  currency to the U.S.  dollar, and that in  1987 Japan's Ministry of Finance
licensed LGT  Investment Trust  Management  Ltd. (Japan)  as  one of  the  first
foreign   discretionary  investment   managers  for   Japanese  investors.  Such
accomplishments, however, should not be viewed as an endorsement of GT Global by
the government of Hong Kong, Japan's Ministry of Finance or any other government
or government agency. Nor do any  such accomplishments of GT Global provide  any
assurance  that  the  GT  Global Mutual  Funds'  investment  objectives  will be
achieved.

THE GT ADVANTAGE
LGT Asset Management has  developed a unique team  approach to its global  money
management  which  we  call  the  GT  Advantage.  LGT  Asset  Management's money
management style combines the best of the "top-down" and

                  Statement of Additional Information Page 44
<PAGE>
                             GT GLOBAL THEME FUNDS
"bottom-up" investment manager strategies. The top-down approach is  implemented
by  LGT  Asset  Management's  Investment  Policy  Committee,  which  sets  broad
guidelines for  asset allocation  and currency  management, based  on LGT  Asset
Management's  own  macroeconomic  forecasts  and  research  from  our  worldwide
offices. The bottom-up approach utilizes regional teams of individual  portfolio
managers  to implement the committee's  guidelines by selecting local securities
that offer strong growth and income potential.

                  Statement of Additional Information Page 45
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                             GT GLOBAL THEME FUNDS

GENERAL INFORMATION ABOUT THE THEME FUNDS AND THEME PORTFOLIOS
Each  Theme  Portfolio  may  invest  worldwide  across  industries  within   the
Portfolio's area of concentration without national or regional restrictions. The
ability  of each  Theme Portfolio  to invest  worldwide may  allow the portfolio
managers to select industries in different economic cycles and varying stages of
development, though there is no assurance  that the managers will be  successful
in this selection.

Each  Theme Portfolio's area  of concentration reflects  the underlying theme of
the Portfoio. GT Global  believes that there are  certain social, political  and
economic  trends  that  may  benefit  one  or  more  industries  within  a Theme
Portfolio's area of concentration. Of course, there is no assurance that any  of
the Funds will benefit as a result.

HEALTH CARE FUND
From  time to time the  Fund and GT Global  will quote information including but
not limited to data regarding:

    / / Trading volume, number of listed companies and the largest companies  of
        the global health care industry

    / / Expenditures by various countries, regions and age groups on health care

    / / Population of countries, regions and age groups

    / / Natality  and  mortality rates  in  various regions,  countries  and age
        groups

    / / Life expectancy rates in various regions, countries and age groups

    / / New health care products and products seeking approval

    / / Health maintenance organizations (HMOs) and its enrollment growth

    / / Studies from,  but  not limited  to,  the American  Medical  Association
        showing the effectiveness of using drugs to cure illness

    / / Medical technology and devices in use or in development

The  information quoted  has not  been independently  verified by  a Fund  or GT
Global and will be based  on data provided that is  believed to be reliable  and
accurate from but not limited to the following sources:

    / / Research  firms such as  Mehta and Isaly  which publishes PHARMACEUTICAL
        PORTFOLIO RECOMMENDATIONS

    / / OECD and its publications such as the OECD HEALTH DATA, as  supplemented
        annually

    / / Morgan  Stanley Capital International stock market industry indices such
        as Health & Personal Care

    / / The World  Bank  and its  publications  such as  THE  WORLD  DEVELOPMENT
        REPORT, as supplemented annually

    / / International  Finance Corporation  (IFC) and  publications such  as the
        EMERGING STOCK MARKETS FACTBOOK

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                             GT GLOBAL THEME FUNDS

INFORMATION ABOUT THE GLOBAL HEALTH CARE INDUSTRY
The Health Care Fund  and LGT Asset Management  believe that certain market  and
demographic  factors merit an  investor's consideration of  making a health care
investment. Worldwide standards of living and life expectancy have increased  at
a  substantial rate during the past twenty  years (based on the most recent data
available at December 31, 1992, as  compiled by the OECD). LGT Asset  Management
expects  this growth, which  works to the  general benefit of  the global health
care industry, to continue at a roughly comparable rate in the future,  although
no  assurances can  be given  in this regard.  Moreover, according  to LGT Asset
Management, the health care industry historically has proven to be a  relatively
non-cyclical industry that continues to provide goods and services to the public
in periods of economic weakness as well as economic strength.

LGT  Asset  Management believes  that the  anticipated  increase in  the world's
elderly population could increase demand for health care products and  services.
According  to data  compiled by  LGT Asset  Management, in  Japan the  number of
people age 65  and older  is expected to  grow over  100% by the  year 2025;  in
Germany, France and the U.S., the same age group should grow 40%. Similarly, the
U.S.  Census Bureau predicts the  number of Americans 85  and older to double in
the next 30 years.

TELECOMMUNICATIONS FUND
From time to time the Fund and  GT Global will quote information including  data
regarding:

    / / Increased  usage  of  new  technologies such  as,  but  not  limited to,
        cellular  and  wireless  communications  in  emerging  and   established
        countries around the world

The  information quoted has  not been independently  verified by the  Fund or GT
Global and will be based  on data provided that is  believed to be reliable  and
accurate from but not limited to the following sources:

    / / Salomon  Brothers World Equity  Telecommunications Index, which includes
        stock market data about  the telecommunications industry in  established
        and developing markets

    / / OECD   and  other  publications  from   its  subsidiaries  such  as  the
        International Telecommunications Union

    / / Morgan Stanley Capital International stock market industry indices  such
        as  Telecommunications, Broadcasting & Publishing  and Data Processing &
        Reproduction

    / / International Technology Consultants (ITC), a Washington D.C. based firm
        which publishes reports such as EASTERN EUROPEAN & SOVIET TELECOM REPORT
        and LATIN AMERICAN TELECOM REPORT

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                             GT GLOBAL THEME FUNDS

INFORMATION ABOUT THE GLOBAL TELECOMMUNICATIONS INDUSTRY
The Telecommunications  Fund  and  LGT Asset  Management  believe  that  certain
political   and  market   factors  merit   an  investor's   consideration  of  a
telecommunications investment. In analyzing the telecommunications industry, LGT
Asset  Management  has  identified  four  areas  that  it  expects  will  create
investment  opportunities. LGT  Asset Management  believes that  deregulation of
companies in  the industry,  which  will allow  competition to  promote  greater
efficiencies,   privatization  of   state-owned  telecommunications  businesses,
development of  infrastructure  in  underdeveloped countries  and  upgrading  of
services  in other  countries, and emergence  of technologies  that will enhance
productivity and reduce costs in the telecommunications industry, each will lead
to growth in the  sector. Of course,  there is no  certainty that these  factors
will produce the anticipated results.

DEREGULATION IN THE UNITED STATES
The  United States  has been  the bellwether  for deregulation  of the telephone
industry. The  divestiture  of  the  Bell System  from  American  Telephone  and
Telegraph  has produced new competing companies  in the United States. Such U.S.
market-driven competition has,  for example,  led to lower  costs for  consumers
which in turn led to greater consumer usage and to higher industrywide revenues.
LGT Asset Management expects this scenario to continue to benefit such companies
in   the   U.S.  and   to   similarly  to   be   realized  by   the  established
telecommunications companies in  established economies,  although no  assurances
can  be made in this  regard. The above information  on the deregulation of long
distance and international telephone  service carriers in  the United States  is
based  on a study from a source that indicated the study would not be updated in
the near future. Although the study has not been updated, GT Global believes the
trend continues to be accurate.

                  Statement of Additional Information Page 48
<PAGE>
                             GT GLOBAL THEME FUNDS

INFORMATION ABOUT THE TELECOMMUNICATIONS INDUSTRY
The Telecommunications  Fund  and  LGT Asset  Management  believe  that  certain
political   and  market   factors  merit   an  investor's   consideration  of  a
telecommunications investment. In analyzing the telecommunications industry, LGT
Asset  Management  has  identified  four  areas  that  it  expects  will  create
investment  opportunities. LGT  Asset Management  believes that  deregulation of
companies in  the industry,  which  will allow  competition to  promote  greater
efficiencies,   privatization  of   state-owned  telecommunications  businesses,
development of  infrastructure  in  underdeveloped countries  and  upgrading  of
services  in other  countries, and emergence  of technologies  that will enhance
productivity and reduce costs in the telecommunications industry, each will lead
to growth in the  sector. Of course,  there is no  certainty that these  factors
will  produce the anticipated results.  The following chart provides information
on the key emerging trends as  identified by LGT Asset Management, occurring  in
the telecommunications industry in some of the world's countries.

GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
From  time to time the Fund and  GT Global will quote information including, but
not limited to, data regarding:

    / / Trading volume, number of listed companies and the largest companies
        located around the world in the consumer products and services
        industries

    / / Expenditures, demand and consumption by various countries, regions,
        income classes and age groups of consumer products and services

    / / Population of countries, regions and age groups

    / / Life expectancy rates in various regions, countries and age groups

    / / New consumer products and services in the development or manufacturing
        stages

    / / Income of various regions, countries and age groups

    / / Sales and sales growth of consumer products and services companies in
        their own country and abroad

    / / Sales, supply and demand of consumer products and services

    / / Parent Companies and the products and services they distribute

The information quoted  will not  be independently verified  by the  Fund or  GT
Global  and will be based  on data provided that is  believed to be reliable and
accurate from, but not limited to, the following sources:

    / / Consumer and trade groups

    / / Fortune magazine and other periodicals

    / / The World Bank and its publications

    / / The International Monetary Fund (IMF) and its publications

    / / The International Finance Corporation (IFC) and its publications

    / / The Organization for Economic Cooperation and Development (OECD) and its
        publications

                  Statement of Additional Information Page 49
<PAGE>
                             GT GLOBAL THEME FUNDS

IMPORTANT POINTS TO NOTE ABOUT DATA RELATING TO WORLD EQUITY AND BOND MARKETS
Information  relating  to   foreign  market   performance,  capitalization   and
diversification  is based on sources  believed to be reliable,  but which may be
subject to revision and which has not been independently verified by the Company
or GT  Global.  The authors  and  publishers of  such  material are  not  to  be
considered  as "experts"  under the  Securities Act of  1933, on  account of the
inclusion of such information therein.

GT Global believes that this information may be useful to investors  considering
whether  and to what extent to  diversify their investments through the purchase
of mutual funds investing in securities on a global basis. However, this data is
not a representation of the past performance of any of these Funds, nor is it  a
prediction  of such performance.  The performance of the  Funds will differ from
the historical performance of relevant indices. The performance of indices  does
not  take  expenses  into  account,  while  each  Fund  incurs  expenses  in its
operations, which will reduce performance. Each Fund is actively managed,  I.E.,
LGT  Asset Management, as each Fund's investment manager, actively purchases and
sells securities in  seeking each  Fund's investment  objective. Moreover,  each
Fund  may  invest a  portion of  its  assets in  corporate bonds,  while certain
indices relate only to  government bonds. Each of  these factors will cause  the
performance of each Fund to differ from relevant indices.

                  Statement of Additional Information Page 50
<PAGE>
                             GT GLOBAL THEME FUNDS

                          DESCRIPTION OF DEBT RATINGS

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

DESCRIPTION OF COMMERCIAL PAPER RATINGS
MOODY'S  INVESTORS SERVICE, INC. ("MOODY'S")  employs the designations "Prime-1"
and "Prime-2"  to indicate  commercial  paper having  the highest  capacity  for
timely  repayment.  Issuers  rated Prime-1  (or  supporting  institutions)have a
superior ability for repayment of short-term debt obligations. Prime-1 repayment
capacity will normally  be evidenced by  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.
Issuers  rated Prime-2  (or supporting institutions)  have a  strong ability for
repayment of short-term  debt obligations.  This normally will  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 alternate liquidity is maintained.

STANDARD &  POOR'S  RATINGS  GROUP'S  ("S&P") rates  commercial  paper  in  four
categories ranging from "A-1" for the highest quality obligations to "D" for the
lowest.  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 will be denoted with a plus sign (+)  designation.
A-2  --  Capacity  for  timely  payment  on  issues  with  this  designation  is
satisfactory. If, 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, 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.

DESCRIPTION OF BOND RATINGS
MOODY'S rates  the long-term  debt securities  issued by  various entities  from
"Aaa" to "C." Investment Grade Ratings are the first four categories:

        Aaa  --  Best quality.  These securities  carry  the smallest  degree of
    investment risk  and are  generally referred  to as  "gilt edged."  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  -- 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 other elements  may be present which  make the long-term risks
    appear somewhat larger than the Aaa securities.

        A -- Upper-medium-grade obligations. These bonds possess many  favorable
    investment attributes. 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 -- 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 -- Have speculative elements and their future cannot be considered to
    be well-assured. Often the protection of interest and principal payments may
    be very moderate and thereby not  well safeguarded during both good and  bad
    times  over the future. Uncertainty of  position characterizes bonds in this
    class.

                  Statement of Additional Information Page 51
<PAGE>
                             GT GLOBAL THEME FUNDS

        B  --  Generally  lack  characteristics  of  the  desirable  investment.
    Assurance  of interest  and principal  payments or  of maintenance  of other
    terms of the contract over any long period of time may be small.

        Caa -- Poor  standing. Such issues  may be  in default or  there may  be
    present elements of danger with respect to principal or interest.

        Ca  -- Speculative in a high degree. Such issues are often in default or
    have other marked shortcomings.

        C -- Lowest rated  class of bonds.  Issues so rated  can be regarded  as
    having  extremely  poor  prospects  of ever  attaining  any  real investment
    standing.

ABSENCE OF RATING: Where no rating has been assigned or where a rating has  been
suspended  or withdrawn, it may  be for reasons unrelated  to the quality of the
issue.

Should no rating be assigned, the reason may be one of the following:

         1. An application for rating was not received or accepted.

         2. The issue or  issuer belongs to a  group of securities or  companies
    that are not rated as a matter of policy.

         3. There is a lack of essential data pertaining to the issue or issuer.

         4.  The issue  was privately  placed, in which  case the  rating is not
    published in Moody's publications.

Suspension or withdrawal may occur if new and material circumstances arise,  the
effects of which preclude satisfactory analysis; if there is no longer available
reasonable  up-to-date data  to permit a  judgement to  be formed; if  a bond is
called for redemption; or for other reasons.

Note: Moody's applies  numerical modifiers  1, 2 and  3 in  each generic  rating
classification  from Aa to B in its corporate bond rating system. 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.

S&P rates the  securities debt of  various entities in  categories ranging  from
"AAA"  to "D" according to quality. Investment  grade ratings are the first four
categories:

        AAA -- Highest rating. Capacity to  pay interest and repay principal  is
    extremely strong.

        AA  --  Very strong  capacity to  pay interest  and repay  principal and
    differs from the higher rated issues only in a small degree.

        A -- Has a strong capacity to pay interest and repay principal  although
    it  is  somewhat  more susceptible  to  the  adverse effects  of  changes in
    circumstances and economic conditions than debt in higher rated categories.

        BBB -- Regarded as  having adequate capacity to  pay interest and  repay
    principal.  Whereas  it  normally exhibits  adequate  protection parameters,
    adverse economic conditions  or changing  circumstances are  more likely  to
    lead  to a weakened capacity to pay interest and repay principal for debt in
    this category than in higher rated categories.

        BB, B, CCC,  CC, C  -- Debt  rated "BB," "B,"  "CCC," "CC,"  and "C"  is
    regarded,  on balance, as predominantly speculative with respect to capacity
    to pay interest  and repay  principal in accordance  with the  terms of  the
    obligation.  "BB" indicates  the lowest  degree of  speculation and  "C" the
    highest degree of speculation. While such debt will likely have some quality
    and protective characteristics, these are outweighed by large  uncertainties
    or major risk exposures to adverse conditions.

        BB -- Has less near-term vulnerability to default than other speculative
    issues. However, it faces major ongoing uncertainties or exposure to adverse
    business,  financial, or economic conditions  which could lead to inadequate
    capacity to meet  timely interest  and principal payments.  The "BB"  rating
    category  is also used for debt subordinated to senior debt that is assigned
    an actual or implied "BBB-" rating.

        B --  Has a  greater  vulnerability to  default  but currently  has  the
    capacity  to  meet  interest  payments  and  principal  repayments.  Adverse
    business, financial, or economic conditions  will likely impair capacity  or
    willingness  to pay interest and repay principal. The "B" rating category is
    also used for debt subordinated to senior debt that is assigned an actual or
    implied "BB" or "BB-" rating.

        CCC --  Has a  currently identifiable  vulnerability to  default and  is
    dependent  upon favorable  business, financial,  and economic  conditions to
    meet timely payment of interest and repayment of principal. In the event  of
    adverse  business, financial,  or economic conditions,  it is  not likely to
    have   the   capacity   to   pay   interest   and   repay   principal.   The

                  Statement of Additional Information Page 52
<PAGE>
                             GT GLOBAL THEME FUNDS
    "CCC" rating category is also used for debt subordinated to senior debt that
    is assigned an actual or implied "B" or "B-" rating.

        CC  -- Typically  applied to  debt subordinated  to senior  debt that is
    assigned an actual or implied "CCC" rating.

        C --  Typically applied  to debt  subordinated to  senior debt  that  is
    assigned an actual or implied "CCC-" debt rating. The "C" rating may be used
    to  cover a situation where  a bankruptcy petition has  been filed, but debt
    service payments are continued.

        C1 -- Reserved for income bonds on which no interest is being paid.

        D -- In payment 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.  This rating  will also  be used  up on the
    filing of a bankruptcy petition if debt service payments are jeopardized.

PLUS (+) OR MINUS  (-): The ratings from  "AA" to "CCC" may  be modified by  the
addition  of a  plus or minus  sign to  show relative standing  within the major
rating categories.

NR:  Indicates  that  no  public  rating  has  been  requested,  that  there  is
insufficient  information on which to base a rating, or that S&P does not rate a
particular type of obligation as a matter of policy.

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

                              FINANCIAL STATEMENTS

- --------------------------------------------------------------------------------
The audited financial statements of  Health Care Fund, Telecommunications  Fund,
Financial  Services  Fund, Infrastructure  Fund  and Natural  Resources  Fund at
October 31,  1994,  and  for the  year  then  ended and  the  audited  financial
statement of Consumer Products and Services Fund at December 20, 1994, appear on
the following pages.

                  Statement of Additional Information Page 53
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Directors of
G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global Financial Services Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., as of October 31, 1994 and the related statement of
operations, the statement of changes in net assets and the financial highlights
for the period from May 31, 1994 (commencement of operations) to October 31,
1994. These financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and the financial highlights based on our
audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the financial highlights
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Financial Services Fund as of October 31, 1994, and the results of
its operations, the changes in its net assets and the financial highlights for
the period from May 31, 1994 (commencement of operations) to October 31, 1994,
in conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 54
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<CAPTION>
Assets:
<S>                                                                                                        <C>
  Investments in Global Financial Services Portfolio (cost $5,148,440) (Note 1)..........................
                                                                                                           $5,175,735
  Receivable for expense reimbursement (Note 2)..........................................................
                                                                                                               96,844
  Receivable for Fund shares sold........................................................................
                                                                                                              143,492
  Unamortized deferred organizational expenses (Note 1)..................................................
                                                                                                               57,842
                                                                                                           ----------
  Total assets...........................................................................................
                                                                                                            5,473,913
                                                                                                           ----------
Liabilities:
  Payable for Fund shares repurchased....................................................................
                                                                                                               19,103
  Payable for registration fees..........................................................................
                                                                                                               13,285
  Payable for professional fees..........................................................................
                                                                                                               10,766
  Payable for printing and postage expenses..............................................................
                                                                                                               10,392
  Payable for service and distribution expenses (Note 2).................................................
                                                                                                                2,993
  Payable for transfer agent fees (Note 2)...............................................................
                                                                                                                2,044
  Payable for custodian fees.............................................................................
                                                                                                                1,800
  Payable for Administration fees (Note 2)...............................................................
                                                                                                                1,087
  Payable for Directors' fees (Note 2)...................................................................
                                                                                                                1,014
  Accrued expenses.......................................................................................
                                                                                                                1,427
                                                                                                           ----------
  Total liabilities......................................................................................
                                                                                                               63,911
                                                                                                           ----------
Net assets...............................................................................................
                                                                                                           $5,410,002
                                                                                                           ----------
                                                                                                           ----------
Class A:
Net asset value and redemption price per share
 ($3,175,149 DIVIDED BY 273,195 shares outstanding)......................................................
                                                                                                           $    11.62
                                                                                                           ----------
                                                                                                           ----------
Maximum offering price per share
 (100/95.25 of $11.62)*..................................................................................
                                                                                                           $    12.20
                                                                                                           ----------
                                                                                                           ----------
Class B:+
Net asset value and offering price per share
 ($2,234,853 DIVIDED BY 192,711 shares outstanding)......................................................
                                                                                                           $    11.60
                                                                                                           ----------
                                                                                                           ----------
Net assets consist of:
  Paid in capital (Note 4)...............................................................................
                                                                                                           $5,404,049
  Undistributed net investment income....................................................................
                                                                                                                5,694
  Accumulated net realized loss on investments and foreign currency conversions --
   Global Financial Services Portfolio...................................................................
                                                                                                              (32,440)
  Net unrealized appreciation of investments -- Global Financial Services Portfolio......................
                                                                                                               32,699
                                                                                                           ----------
  Total -- representing net assets applicable to capital shares outstanding..............................
                                                                                                           $5,410,002
                                                                                                           ----------
                                                                                                           ----------
</TABLE>

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

*   On sales of $50,000 or more, the offering price is reduced.

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 55
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                               <C>        <C>
Investment income (Note 1):
  Dividend income -- Global Financial Services Portfolio...................................................  $  23,933
  Interest income -- Global Financial Services Portfolio...................................................     13,042
                                                                                                             ---------
  Total investment income..................................................................................     36,975
                                                                                                             ---------
Expenses:
  Expenses -- Global Financial Services Portfolio..........................................................     50,670
  Professional fees........................................................................................     20,890
  Transfer agent fees (Note 2).............................................................................     15,637
  Printing and postage expenses............................................................................     10,623
  Service and distribution expenses (Note 2):
    Class A.....................................................................................  $   3,860
    Class B.....................................................................................      4,398      8,258
                                                                                                  ---------
  Registration fees........................................................................................      5,300
  Amortization of organizational expenses (Note 1).........................................................      5,258
  Directors' fees (Note 2).................................................................................      5,090
  Administration fees (Note 2).............................................................................      3,029
  Custodian fees...........................................................................................      1,840
  Other....................................................................................................      1,530
                                                                                                             ---------
  Total expenses before expense reimbursement..............................................................    128,125
  Less expense reimbursement (Note 2)......................................................................    (96,844)
                                                                                                             ---------
  Total expenses...........................................................................................     31,281
                                                                                                             ---------
Net investment income......................................................................................      5,694
                                                                                                             ---------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
  Net realized loss on investments -- Global Financial Services Portfolio.......................    (25,821)
  Net realized loss on foreign currency conversions -- Global Financial Services Portfolio......     (6,619)
                                                                                                  ---------
  Net realized loss........................................................................................    (32,440)
  Increase in unrealized appreciation of investments -- Global Financial Services Portfolio................     32,699
                                                                                                             ---------
Net realized and unrealized gain on investments and foreign currency conversions -- Global Financial
 Services Portfolio........................................................................................        259
                                                                                                             ---------
Net increase in net assets resulting from operations.......................................................  $   5,953
                                                                                                             ---------
                                                                                                             ---------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 56
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment income..............................................................................
                                                                                                               $       5,694
  Net realized loss on investments and foreign currency conversions..................................
                                                                                                                     (32,440)
  Increase in unrealized appreciation of investments.................................................
                                                                                                                      32,699
                                                                                                                 -----------
  Net increase in net assets resulting from operations...............................................
                                                                                                                       5,953
Capital Share Transactions (Note 3):
  Increase from shares sold..........................................................................
                                                                                                                   5,652,003
  Decrease from shares repurchased...................................................................
                                                                                                                    (347,954)
                                                                                                                 -----------
  Net increase from capital shares transactions......................................................
                                                                                                                   5,304,049
                                                                                                                 -----------
Total increase in net assets.........................................................................
                                                                                                                   5,310,002
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,000
                                                                                                                 -----------
  End of period......................................................................................
                                                                                                               $   5,410,002*
                                                                                                                 -----------
                                                                                                                 -----------
</TABLE>

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

*   Includes undistributed net investment income of $5,694.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 57
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                              FINANCIAL HIGHLIGHTS

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

Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data
throughout the period. This information has been derived from information
provided in the financial statements.

<TABLE>
<CAPTION>
                                                                                  CLASS A                        CLASS B
                                                                               MAY 31, 1994                   MAY 31, 1994
                                                                       (COMMENCEMENT OF OPERATIONS)   (COMMENCEMENT OF OPERATIONS)
                                                                                    TO                             TO
                                                                             OCTOBER 31, 1994               OCTOBER 31, 1994
                                                                       -----------------------------  -----------------------------
<S>                                                                    <C>                            <C>
Per Share Operating Performance:
Net asset value, beginning of period.................................            $   11.43                      $   11.43
                                                                                   -------                        -------
Income from investment operations:
  Net investment income..............................................                 0.02*                          0.00*
  Net realized and unrealized gain on investments and foreign
   currency conversions..............................................                 0.17**                         0.17**
                                                                                   -------                        -------
  Net increase resulting from investment operations..................                 0.19                           0.17
                                                                                   -------                        -------
Net asset value, end of period.......................................            $   11.62                      $   11.60
                                                                                   -------                        -------
                                                                                   -------                        -------

Total investment return (c)..........................................                 1.66%(b)                       1.49%(b)

Ratios and supplemental data:
  Net assets, end of period (in 000's)...............................            $   3,175                      $   2,235
  Ratio of net investment income to average net assets...............                 0.66%(a)*                      0.16%(a)*
  Ratio of net expenses to average net assets........................                 2.40%(a)*                      2.90%(a)*
</TABLE>

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

(a) Annualized.

(b) Not annualized.

(c) Total investment return does not include sales charges.

*   The annualized ratios of operating expenses and net investment income to
    average net assets for Class A and Class B before reimbursement by G.T.
    Capital Management, Inc. for the period ended October 31, 1994 would have
    been 10.32% and (7.26)%; and 10.82% and (7.76)%, respectively. The net
    investment income per share would have been reduced by $0.23 for each class.

**  The per share amount does not correspond with the net realized and
    unrealized gain for the period due to the timing of the sales of Fund shares
    and the amount of per share realized and unrealized gains and losses at such
    time.

                  Statement of Additional Information Page 58
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Financial Services Fund ("Fund") is a separate series of G.T.
Investment Funds, Inc. ("Company"). The Company is organized as a Maryland
corporation and is registered under the Investment Company Act of 1940, as
amended ("1940 Act"), as a diversified, open-end management investment company.
The Company has eleven series of shares in operation, each series corresponding
to a distinct portfolio of investments. The Fund invests substantially all of
its investable assets in Global Financial Services Portfolio ("Portfolio"),
which is registered as an open-end management investment company under the 1940
Act and has investment objectives, policies and limitations substantially
identical to those of the Fund. The value of the Fund's investment in the
Portfolio reflects the Fund's proportionate interest in the net assets of the
Portfolio. The financial statements of the Portfolio, including the Portfolio of
Investments, are included elsewhere in this Report and should be read in
conjunction with the Fund's financial statements.

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.

(A)  INVESTMENT VALUATION
Valuation of securities and other investment practices by the Portfolio are
discussed in Note 1 of the Portfolio's Notes to Financial Statements which are
included elsewhere in this Report.

(B)  TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains. The Fund currently has a capital loss carryforward of $22,442
which expires in 2002.

(C)  DISTRIBUTION TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Portfolio and timing differences.

(D)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $63,500. These expenses
are being amortized on a straightline basis over a five-year period.

2. RELATED PARTIES
G.T. Capital Management, Inc. ("G.T. Capital") is the Fund's administrator. The
Fund pays administration fees to G.T. Capital at the annualized rate of 0.25% of
the Fund's average daily net assets. These fees are computed daily and paid
monthly, and are subject to reduction in any year to the extent that the Fund's
expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary items) exceed the most stringent
limits prescribed by the laws or regulations of any state in which the Fund's
shares are offered for sale, based on the average total net asset value of the
Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended October 31, 1994, G.T. Global retained
$4,612 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.

                  Statement of Additional Information Page 59
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. For the period ended October 31,
1994, G.T. Global collected CDSCs in the amount of $847. In addition, G.T.
Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate plans of distribution with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.50% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expenses) to the maximum annual rate of 2.40% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of administration
fees, waivers by G.T. Global of payments under the Class A Plan and/ or Class B
Plan and/or reimbursements by G.T. Capital or G.T. Global of portions of the
Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

                  Statement of Additional Information Page 60
<PAGE>
                       GT GLOBAL FINANCIAL SERVICES FUND

3. CAPITAL SHARES
At October 31, 1994, there were 6,000,000,000 shares of the Company's common
stock authorized, at $0.0001 par value. Of this amount, 200,000,000 were
classified as shares of the Fund; 400,000,000 were classified as shares of G.T.
Global Government Income Fund; 200,000,000 were classified as shares of G.T.
Global Health Care Fund; 200,000,000 were classified as shares of G.T. Global
Emerging Markets Fund; 200,000,000 were classified as shares of G.T. Global
Currency Fund (inactive); 200,000,000 were classified as shares of G.T. Global
Growth & Income Fund; 200,000,000 were classified as shares of G.T. Global Small
Companies Fund (inactive); 200,000,000 were classified as shares of G.T. Latin
America Growth Fund; 400,000,000 were classified as shares of G.T. Global
Telecommunications Fund; 200,000,000 were classified as shares of G.T. Global
Strategic Income Fund; 200,000,000 were classified as shares of G.T. Global High
Income Fund; 200,000,000 were classified as shares of G.T. Global Natural
Resources Fund; 200,000,000 were classified as shares of G.T. Global
Infrastructure Fund; 200,000,000 were classified as shares of G.T. Global
Consumer Products and Services Fund (inactive); and 2,800,000,000 shares remain
unclassified. The shares of each of the foregoing series of the Company were
divided equally into two classes, designated Class A and Class B common stock.
Transactions in capital shares of the Fund were as follows:

                           CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
                                                                                                          MAY 31, 1994
                                                                                                        (COMMENCEMENT OF
                                                                                                           OPERATIONS)
                                                                                                       TO OCTOBER 31, 1994
                                                                                                      ---------------------
CLASS A                                                                                                SHARES      AMOUNT
- ----------------------------------------------------------------------------------------------------  ---------  ----------
<S>                                                                                                   <C>        <C>
Shares sold.........................................................................................    288,905  $3,352,036
Shares repurchased..................................................................................    (20,084)   (233,975)
                                                                                                      ---------  ----------
Net increase........................................................................................    268,821  $3,118,061
                                                                                                      ---------  ----------
                                                                                                      ---------  ----------

<CAPTION>

                                                                                                          MAY 31, 1994
                                                                                                        (COMMENCEMENT OF
                                                                                                           OPERATIONS)
                                                                                                       TO OCTOBER 31, 1994
                                                                                                      ---------------------
CLASS B                                                                                                SHARES      AMOUNT
- ----------------------------------------------------------------------------------------------------  ---------  ----------
<S>                                                                                                   <C>        <C>
Shares sold.........................................................................................    198,242  $2,299,967
Shares repurchased..................................................................................     (9,906)   (113,979)
                                                                                                      ---------  ----------
Net increase........................................................................................    188,336  $2,185,988
                                                                                                      ---------  ----------
                                                                                                      ---------  ----------
</TABLE>

                  Statement of Additional Information Page 61
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Trustees of
Global Financial Services Portfolio:

We have audited the accompanying statement of assets and liabilities of Global
Financial Services Portfolio, including the schedule of portfolio investments,
as of October 31, 1994 and the related statement of operations, statement of
changes in net assets and supplementary data for the period from May 31, 1994
(commencement of operations) to October 31, 1994. These financial statements and
the supplementary data are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial statements and the
supplementary data based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the supplementary data are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the supplementary data referred to
above present fairly, in all material respects, the financial position of Global
Financial Services Portfolio as of October 31, 1994 and the results of its
operations, the changes in its net assets and the supplementary data for the
period from May 31, 1994 (commencement of operations) to October 31, 1994, in
conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 62
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                            PORTFOLIO OF INVESTMENTS

                                October 31, 1994

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity                                       Market       % of Net
Investments        Country      Shares       Value       Assets(a)
<S>              <C>          <C>         <C>           <C>
- --------------------------------------------------------------------
Banks-Regional (50.6%)
- ----------------------------------------
Bank of Ireland         IRL       59,500      $274,493         5.3
BayBanks, Inc.           US        4,400       254,100         4.8
Banco
 Commercial
 S.A. 144A ADR
 (b)(c)(d)             URGY       12,000       238,500         4.6
Amalgamated
 Banks of South
 Africa               S AFR       90,900       232,350         4.5
Banco Nacional
 S.A.
 (Preferred)           BRZL    7,500,000       204,203         3.9
The Thai
 Farmers Bank,
 Ltd. (Foreign)        THAI       22,500       198,636         3.8
West One
 Bancorp                 US        7,000       192,500         3.7
Bangkok Bank
 Public Co.
 Ltd. (Foreign)        THAI       14,700       159,270         3.1
Uniao Bancos
 Brasileiros -
 Unibanco
 (Preferred
 "A")                  BRZL    5,000,000       158,170         3.1
Mellon Bank
 Corporation             US        2,000       111,250         2.1
Banco Wiese ADR
 (b)(c)                PERU        5,000       106,250         2.1
Grupo
 Financiero
 Banamex
 Accival, S.A.
 de C.V. "C"            MEX       14,000        96,270         1.9
Den Danske Bank         DEN        1,500        80,599         1.6
Benson
 Financial
 Corporation
 (c)                     US        6,000        72,000         1.4
Westpac Banking
 Corporation
 Ltd.                  AUSL       20,000        67,167         1.3

<CAPTION>
Equity                                       Market       % of Net
Investments        Country      Shares       Value       Assets(a)
<S>              <C>          <C>         <C>           <C>
- --------------------------------------------------------------------
Banco Bradesco
 de
 Investimento
 S.A.
 (Preferred)           BRZL    6,200,000       $58,032         1.1
Zions Bancor-
 poration                US        1,500        56,438         1.1
Unidanmark AS
 "A"                    DEN        1,300        52,168         1.0
Glacier
 Bancorp, Inc.           US          500         8,875         0.2
                                          ------------
                                             2,621,271
                                          ------------
Other Financial (14.3%)
- ----------------------------------------
House of
 Investments,
 Inc.                  PHIL      128,000       268,387         5.2
First Data
 Corporation             US        4,100       205,513         4.0
Dean Witter
 Discover and
 Company                 US        3,000       115,875         2.2
Transaction
 Network
 Service (c)             US        6,000        78,750         1.5
First Financial
 Caribbean
 Corporation             US        6,400        73,600         1.4
                                          ------------
                                               742,125
                                          ------------
Real Estate Investment Trust (10.9%)
- ----------------------------------------
Evans
 Withycombe
 Residential,
 Inc.             US              13,000       256,750          5.0
JP Realty Inc.    US               7,700       151,113          2.9
Alexander
 Haagen
 Properties,
 Inc.             US               5,300        85,463          1.6
Macerich
 Company (The)    US               2,600        52,000          1.0
Shugard Storage
 Centers, Inc.
 "A"              US               1,000        21,250          0.4
                                          ------------
                                               566,576
                                          ------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 63
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO
<TABLE>
<CAPTION>
Equity                                       Market       % of Net
Investments        Country      Shares       Value       Assets(a)
- --------------------------------------------------------------------
<S>              <C>          <C>         <C>           <C>
Banks-Super Regional (8.5%)
- ----------------------------------------
First
 Interstate
 Bancorp                 US        3,000      $240,000         4.7
BankAmerica
 Corporation             US        2,500       108,750         2.1
Banc One
 Corporation             US        3,000        86,625         1.7
                                          ------------
                                               435,375
                                          ------------
Banks-Money Center (3.7%)
- ----------------------------------------
National
 Westminster
 Bank PLC         UK              14,800       121,760          2.3
Citicorp          US               1,500        71,625          1.4
                                          ------------
                                               193,385
                                          ------------
Country Funds (2.7%)
- ----------------------------------------
Korean
 Investment
 Fund, Inc.
 (b)(c)           KOR              3,400        46,750          0.9
Korea Fund,
 Inc. (b)         KOR              1,900        46,075          0.9
Korea Equity
 Fund (b)(c)      KOR              4,700        45,238          0.9
                                          ------------
                                               138,063
                                          ------------
<CAPTION>
Equity                                       Market       % of Net
Investments        Country      Shares       Value       Assets(a)
<S>              <C>          <C>         <C>           <C>
- --------------------------------------------------------------------

Investment Management (2.5%)
- ----------------------------------------
M & G Group PLC          UK        3,500       $54,999         1.1
Franklin
 Resources,
 Inc.                    US        1,000        40,875         0.8
Eaton Vance
 Corporation             US        1,000        31,625         0.6
                                          ------------
                                               127,499
                                          ------------
Consumer Finance (2.1%)
- ----------------------------------------
Green Tree
 Financial
 Corporation      US               4,000       109,500          2.1

Insurance-Life (1.5%)
- ----------------------------------------
Kemper
 Corporation      US               1,500        78,375          1.5
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total Equity Investments
 (cost $4,979,479)*.....................     5,012,169         96.8
Other Assets Less Liabilities...........       163,666          3.2
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Net Assets..............................    $5,175,835        100.0
- --------------------------------------------------------------------
- --------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a)  Percentages indicated are based on net assets of $5,175,835.
(b)  U.S. currency denominated.
(c)  Non-income producing security.
(d)  Security exempt from registration under Rule 144A of the Securities Act of
     1933. These securities may be resold in transactions exempt from
     registration, normally to qualified institutional buyers.

Abbreviation:
ADR -- American Depository Receipt
*      For Federal income tax purposes, cost is $4,982,857 and appreciation
       (depreciation) of securities is as follows:

Unrealized appreciation:    $ 189,457
Unrealized depreciation:     (160,145)
                            ---------
Net unrealized
appreciation:               $  29,312
                            ---------
                            ---------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 64
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

The Fund's portfolio of investments at October 31, 1994, was concentrated in the
following countries:

<TABLE>
<CAPTION>
                                         Percentage of Net Assets(a)
                                     -----------------------------------
Country                                Equity        Other       Total
- -----------------------------------  -----------  -----------  ---------
<S>                                  <C>          <C>          <C>
Australia                                    1.3                     1.3
Brazil                                       8.1                     8.1
Denmark                                      2.6                     2.6
Ireland                                      5.3                     5.3
Korea                                        2.7                     2.7
Mexico                                       1.9                     1.9
Peru                                         2.1                     2.1
Philippines                                  5.2                     5.2
South Africa                                 4.5                     4.5
Thailand                                     6.9                     6.9
UK                                           3.4                     3.4
U.S.                                        48.2          3.2       51.4
Uruguay                                      4.6                     4.6
                                           ---          ---    ---------
Total                                       96.8          3.2      100.0
                                           ---          ---    ---------
                                           ---          ---    ---------
<FN>
- ----------------
(a)  Percentages indicated are based on net assets of $5,175,835.
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 65
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<S>                                                                                                        <C>
Assets:
  Investments in securities, at value (cost $4,979,479) (Note 1).........................................
                                                                                                           $5,012,169
  Foreign Currency (cost $767)...........................................................................
                                                                                                                  774
  Receivable for securities sold.........................................................................
                                                                                                              237,232
  Unamortized deferred organizational expenses (Note 1)..................................................
                                                                                                               22,917
  Dividends receivable...................................................................................
                                                                                                                9,501
  Cash held as collateral for securities loaned (Note 1).................................................
                                                                                                               48,000
                                                                                                           ----------
  Total assets...........................................................................................
                                                                                                            5,330,593
                                                                                                           ----------
Liabilities:
  Due to Custodian.......................................................................................
                                                                                                               54,321
  Payable for deferred organizational expenses...........................................................
                                                                                                               25,000
  Payable for professional fees..........................................................................
                                                                                                               11,889
  Payable for printing and postage expenses..............................................................
                                                                                                                5,757
  Payable for investment management and administration fees (Note 2).....................................
                                                                                                                4,293
  Payable for Trustees' fees (Note 2)....................................................................
                                                                                                                2,141
  Accrued expenses.......................................................................................
                                                                                                                3,357
  Collateral for securities loaned (Note 1)..............................................................
                                                                                                               48,000
                                                                                                           ----------
  Total liabilities......................................................................................
                                                                                                              154,758
                                                                                                           ----------
Net assets...............................................................................................
                                                                                                           $5,175,835
                                                                                                           ----------
                                                                                                           ----------
Net assets consist of:
  Paid in capital........................................................................................
                                                                                                           $5,189,271
  Accumulated net investment loss........................................................................
                                                                                                              (13,695)
  Accumulated net realized loss on investments and foreign currency conversions..........................
                                                                                                              (32,440)
  Net unrealized appreciation of investments.............................................................
                                                                                                               32,699
                                                                                                           ----------
  Total -- representing net assets applicable to shares of beneficial interest outstanding...............
                                                                                                           $5,175,835
                                                                                                           ----------
                                                                                                           ----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 66
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                                <C>        <C>
Investment income (Note 1):
  Dividends.................................................................................................  $  23,933
  Interest..................................................................................................     13,042
                                                                                                              ---------
  Total investment income...................................................................................     36,975
                                                                                                              ---------
Expenses:
  Professional fees.........................................................................................     20,370
  Investment management and administration fees (Note 2)....................................................      8,249
  Custodian fees............................................................................................      7,880
  Printing and postage expenses.............................................................................      7,650
  Trustees' fees (Note 2)...................................................................................      2,908
  Amortization of organizational expenses (Note 1)..........................................................      2,083
  Other.....................................................................................................      1,530
                                                                                                              ---------
  Total expenses............................................................................................     50,670
                                                                                                              ---------
Net investment loss.........................................................................................    (13,695)
                                                                                                              ---------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
  Net realized loss on investments...............................................................  $ (25,821)
  Net realized loss on foreign currency conversions..............................................     (6,619)
                                                                                                   ---------
  Net realized loss.........................................................................................    (32,440)
  Increase in unrealized appreciation on investments........................................................     32,699
                                                                                                              ---------
Net realized and unrealized gain on investments and foreign currency conversions............................        259
                                                                                                              ---------
Net decrease in net assets resulting from operations........................................................  $ (13,436)
                                                                                                              ---------
                                                                                                              ---------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 67
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment loss................................................................................
                                                                                                               $     (13,695)
  Net realized loss on investments and foreign currency conversions..................................
                                                                                                                     (32,440)
  Increase in unrealized appreciation of investments.................................................
                                                                                                                      32,699
                                                                                                                 -----------
  Net decrease in net asssets resulting from operations..............................................
                                                                                                                     (13,436)
Beneficial interest transactions:
  Contributions......................................................................................
                                                                                                                   5,089,171
  Withdrawals........................................................................................
                                                                                                                           0
                                                                                                                 -----------
  Net increase from beneficial interest transactions.................................................
                                                                                                                   5,089,171
                                                                                                                 -----------
Total increase in net assets.........................................................................
                                                                                                                   5,075,735
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,100
                                                                                                                 -----------
  End of period*.....................................................................................
                                                                                                               $   5,175,835
                                                                                                                 -----------
                                                                                                                 -----------
</TABLE>

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

*   Includes accumulated net investment loss of $(13,695).

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 68
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                               SUPPLEMENTARY DATA

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

Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Ratios and supplemental data:
Net assets, end of period (in 000's).................................................................            $   5,176
Ratio of net investment income to average net assets.................................................                 1.19%(a)
Ratio of operating expenses to average net assets....................................................                 4.43%(a)
Portfolio turnover rate..............................................................................                   53%
</TABLE>

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

(a) Annualized.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 69
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
Global Financial Services Portfolio ("Portfolio") is organized as a New York
Trust and is registered under the Investment Company Act of 1940, as amended
("1940 Act"), as a non-diversified, open-end management investment company. The
following is a summary of significant accounting policies consistently followed
by the Portfolio in the preparation of the financial statements. The policies
are in conformity with generally accepted accounting principles.

(A)  PORTFOLIO VALUATION
The Portfolio calculates the net asset value of and completes orders to
purchase, exchange or repurchase Portfolio shares of beneficial interest on each
business day, with the exception of those days on which the New York Stock
Exchange is closed.

Equity Securities are valued at the last sale price on the exchange on which
such securities are traded, or, in the principal over-the-counter market in
which such securities are traded as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuation, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Portfolio's Board of Trustees.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Portfolio's Board of Trustees.

(B)  FOREIGN CURRENCY TRANSLATION
The accounting records of the Portfolio are maintained in U.S. dollars. The
market values of foreign securities, currency holdings, other assets and
liabilities are recorded in the books and records of the Portfolio after
translation to U.S. dollars based on the exchange rates on that day. The cost of
each security is determined using historical exchange rates. Income and
withholding taxes are translated at prevailing exchange rates when accrued or
incurred.

The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currency conversions, currency gains or losses realized between the
trade and settlement dates on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities at fiscal year end, resulting from changes in the exchange rate.

In addition, the Portfolio may focus its investments in certain related
financial services, subjecting the Portfolio to greater risk than a fund that is
more diversified.

                  Statement of Additional Information Page 70
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

(C)  REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Portfolio, it is the
Portfolio's policy to always receive, as collateral, United States government
securities or other high quality debt securities of which the value, including
accrued interest, is at least equal to the amount to be paid to the Portfolio
under each agreement at its maturity.

(D)  FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Portfolio as an unrealized gain or loss. When the Forward is closed, the
Portfolio records a realized gain or loss equal to the difference between the
value at the time it was opened and the value at the time it was closed. The
Portfolio could be exposed to risk if a counterparty is unable to meet the terms
of the contract or if the value of the currency changes unfavorably. The
Portfolio may enter into Forwards in connection with planned purchases or sales
of securities or to hedge the value of portfolio securities denominated in a
foreign currency.

(E)  OPTION ACCOUNTING PRINCIPLES
When the Portfolio writes a call or put option, an amount equal to the premium
received is included in the Portfolio's "Statement of Assets and Liabilities" as
an asset and an equivalent liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the option.
The current market value of an option listed on a traded exchange is valued at
its last settlement price, or in the case of an over-the-counter option is
valued at the bid price obtained from a broker. If an option expires on its
stipulated expiration date or if the Portfolio enters into a closing purchase
transaction, a gain or loss is realized without regard to any unrealized gain or
loss on the underlying security, and the liability related to such option is
extinguished. If a written call option is exercised, a gain or loss is realized
from the sale of the underlying security and the proceeds of the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the underlying security purchased would be decreased by
the premium originally received. The Portfolio can write options only on a
covered basis, which for a call requires that the Portfolio holds the underlying
security and for a put requires the Portfolio to set aside cash, U.S. government
securities or other liquid, high-grade debt securities in an amount not less
than the exercise price or otherwise provide adequate cover at all times while
the put option is outstanding. At October 31, 1994, the Portfolio had no written
options.

The premium paid by the Portfolio for the purchase of a call or put option is
included in the Portfolio's "Statement of Assets and Liabilities" as an
investment and subsequently "marked-to-market" to reflect the current market
value of the option. If an option which the Portfolio has purchased expires on
the stipulated expiration date, the Portfolio realizes a loss in the amount of
the cost of the option. If the Portfolio enters into a closing sale transaction,
the Portfolio realizes a gain or loss, depending on whether proceeds from the
closing sale transaction are greater or less than the cost of the option. If the
Portfolio exercises a call option, the cost of the securities acquired by
exercising the call is increased by the premium paid to buy the call. If the
Portfolio exercises a put option, it realizes a gain or loss from the sale of
the underlying security, and the proceeds from such sale are decreased by the
premium originally paid. At October 31, 1994, the Portfolio had no outstanding
purchased options.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.

(F)  FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Portfolio is required to pledge to the broker an amount of cash or securities
equal to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Portfolio agrees to receive
from or pay to the broker an amount of cash equal to the daily fluctuation in
value of the contract. Such receipts or payments are known as "variation margin"
and are recorded by the Portfolio as unrealized gains or losses. When the
contract is closed, the Portfolio records a realized gain or loss equal to the
difference between the value of the contract at the time it was opened and the
value at the time it was closed. The potential risk to the Portfolio is that the
change in value of the underlying securities may not correlate to the change in
value of the contracts. At October 31, 1994, the Portfolio did not hold futures
contracts.

                  Statement of Additional Information Page 71
<PAGE>
                      GLOBAL FINANCIAL SERVICES PORTFOLIO

(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Portfolio may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Portfolio to subsequently invest at
less advantageous prices.

(H)  PORTFOLIO SECURITIES LOANED
At October 31, 1994, stocks with an aggregate value of approximately $47,400
were on loan to brokers. The loans were secured by cash collateral of $48,000.
For international securities, cash collateral is received by the Portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the Portfolio against loaned securities in the amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. For
the period ended October 31, 1994, the Portfolio received $50 of income from
securities lending which was used to offset the Portfolio's custody expenses.

(I)  TAXES
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code of 1986, as amended ("Code"). Therefore, no provision has been made
for Federal taxes on income, capital gains, or unrealized appreciation of
securities held.

(J)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Portfolio in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $25,000. These expenses
are being amortized on a straightline basis over a five-year period.

(K)  FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Portfolio's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(L)  INDEXED SECURITIES
The Portfolio may invest in indexed securities whose value is linked either
directly or indirectly to changes in foreign currencies, interest rates,
equities, indices, or other reference instruments. Indexed securities may be
more volatile than the reference instrument itself, but any loss is limited to
the amount of the original investment.

2. RELATED PARTIES
G.T. Capital is the Portfolio's investment manager and administrator. The
Portfolio pays investment management and administration fees to G.T. Capital at
the annualized rate of 0.725% on the first $500 million of average daily net
assets of the Portfolio; 0.70% on the next $500 million; 0.675% on the next $500
million; and 0.65% on amounts thereafter. These fees are computed daily and paid
monthly.

The Portfolio pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global Financial Services, Inc. or G.T. Global
Investor Services Inc. $500 per year plus $150 for each meeting of the board or
any committee thereof attended by the Trustees.

At October 31, 1994, all of the shares of beneficial interest of the Portfolio
were owned either by G.T. Global Financial Services Fund or G.T. Capital.

3. PURCHASES AND SALES OF SECURITIES
For the period ended October 31, 1994, purchases and sales of investment
securities by the Portfolio, other than U.S. government obligations and
short-term investments, aggregated $6,216,543 and
$1,211,277, respectively. There were no purchases or sales of U.S. government
obligations by the Portfolio for the period ended October 31, 1994.

                  Statement of Additional Information Page 72
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Directors of G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global Infrastructure Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., as of October 31, 1994 and the related statement of
operations, statement of changes in net assets and the financial highlights for
the period ended May 31, 1994 (commencement of operations) to October 31, 1994.
These financial statements and the financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the financial highlights
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Infrastructure Fund as of October 31, 1994, and the results of its
operations, the changes in its net assets and the financial highlights for the
period from May 31, 1994 (commencement of operations) to October 31, 1994, in
conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 73
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<CAPTION>
Assets:
<S>                                                                                                      <C>
  Investments in Global Infrastructure Portfolio (cost $49,997,022) (Note 1)...........................
                                                                                                         $  51,106,690
  Receivable for Fund shares sold......................................................................
                                                                                                             3,453,478
  Receivable for expense reimbursement (Note 2)........................................................
                                                                                                                68,271
  Unamortized deferred organizational expenses (Note 1)................................................
                                                                                                                47,208
  Prepaid expenses.....................................................................................
                                                                                                                 2,044
                                                                                                         -------------
  Total assets.........................................................................................
                                                                                                            54,677,691
                                                                                                         -------------
Liabilities:
  Payable for service and distribution expenses (Note 2)...............................................
                                                                                                                28,736
  Payable for Fund shares repurchased..................................................................
                                                                                                                23,648
  Payable for registration fees........................................................................
                                                                                                                15,064
  Payable for printing and postage expenses............................................................
                                                                                                                12,589
  Payable for professional fees........................................................................
                                                                                                                11,029
  Payable for Administration fees (Note 2).............................................................
                                                                                                                 9,243
  Payable for custodian fees...........................................................................
                                                                                                                 5,194
  Payable for Directors' fees (Note 2).................................................................
                                                                                                                 1,281
  Accrued expenses.....................................................................................
                                                                                                                 1,421
                                                                                                         -------------
  Total liabilities....................................................................................
                                                                                                               108,205
                                                                                                         -------------
Net assets.............................................................................................
                                                                                                         $  54,569,486
                                                                                                         -------------
                                                                                                         -------------
Class A:
Net asset value and redemption price per share
  ($23,615,168 DIVIDED BY 1,893,269 shares outstanding)................................................
                                                                                                         $       12.47
                                                                                                         -------------
                                                                                                         -------------
Maximum offering price per share
  (100/95.25 of $12.47)*...............................................................................
                                                                                                         $       13.09
                                                                                                         -------------
                                                                                                         -------------
Class B:+
Net asset value and offering price per share
  ($30,954,318 DIVIDED BY 2,486,186 shares outstanding)................................................
                                                                                                         $       12.45
                                                                                                         -------------
                                                                                                         -------------
Net assets consist of:
  Paid in capital (Note 3).............................................................................
                                                                                                         $  53,494,717
  Undistributed net investment income..................................................................
                                                                                                                13,178
  Accumulated net realized loss on investments and foreign currency conversions -- Global
   Infrastructure Portfolio............................................................................
                                                                                                               (49,221)
  Net unrealized appreciation of investments, dividends receivable, interest receivable, securities
   purchased and sold and foreign currency conversions -- Global Infrastructure Portfolio..............
                                                                                                             1,110,812
                                                                                                         -------------
  Total -- representing net assets applicable to capital shares outstanding............................
                                                                                                         $  54,569,486
                                                                                                         -------------
                                                                                                         -------------
</TABLE>

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

*   On sales of $50,000 or more, the offering price is reduced.

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 74
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                            <C>         <C>
Investment income (Note 1):
  Dividend income -- Global Infrastructure Portfolio.....................................................  $  121,069
  Interest income -- Global Infrastructure Portfolio.....................................................     104,902
                                                                                                           ----------
  Total investment income................................................................................     225,971
                                                                                                           ----------
Expenses:
  Expenses -- Global Infrastructure Portfolio............................................................     101,457
  Service and distribution expenses (Note 2)
    Class A..................................................................................  $   18,271
    Class B..................................................................................      40,937      59,208
                                                                                               ----------
  Transfer agent fees (Note 2)...........................................................................      33,831
  Printing and postage expenses..........................................................................      23,570
  Professional fees......................................................................................      19,772
  Administration fees (Note 2)...........................................................................      19,370
  Registration fees......................................................................................       8,112
  Custodian fees.........................................................................................       5,332
  Directors' fees (Note 2)...............................................................................       4,590
  Amortization of organizational expenses (Note 1).......................................................       4,292
  Other..................................................................................................       1,530
                                                                                                           ----------
  Total expenses before expense reimbursement............................................................     281,064
  Less expense reimbursement (Note 2)....................................................................     (68,271)
                                                                                                           ----------
  Total expenses.........................................................................................     212,793
                                                                                                           ----------
Net investment income....................................................................................      13,178
                                                                                                           ----------
Net realized and unrealized loss on investments and foreign currencies (Note 1):
  Net realized loss on investments -- Global Infrastructure Portfolio........................     (27,320)
  Net realized loss on foreign currency conversions -- Global Infrastructure Portfolio.......     (21,901)
                                                                                               ----------
  Net realized loss......................................................................................     (49,221)
  Increase in unrealized appreciation of dividends receivable, interest receivable,
   securities purchased and sold, and foreign currency conversions -- Global Infrastructure
   Portfolio.................................................................................       1,144
  Increase in unrealized appreciation of investments -- Global Infrastructure Portfolio......   1,109,668
                                                                                               ----------
  Net unrealized appreciation............................................................................   1,110,812
                                                                                                           ----------
Net realized and unrealized gain on investments and foreign currency conversions -- Global Infrastructure
 Portfolio...............................................................................................   1,061,591
                                                                                                           ----------
Net increase in net assets resulting from operations.....................................................  $1,074,769
                                                                                                           ----------
                                                                                                           ----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 75
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment income..............................................................................
                                                                                                               $      13,178
  Net realized loss on investments and foreign currency conversions -- Global Infrastructure
   Portfolio.........................................................................................
                                                                                                                     (49,221)
  Increase in unrealized appreciation of investments, dividends receivable, interest receivable,
   securities purchased and sold and foreign currency conversions -- Global Infrastructure
   Portfolio.........................................................................................
                                                                                                                   1,110,812
                                                                                                                ------------
  Net increase in net asssets resulting from investment operations...................................
                                                                                                                   1,074,769
Capital Share Transactions (Note 3):
  Increase from shares sold and reinvested...........................................................
                                                                                                                  55,939,368
  Decrease from shares repurchased...................................................................
                                                                                                                  (2,544,651)
                                                                                                                ------------
  Net increase from capital share transactions.......................................................
                                                                                                                  53,394,717
                                                                                                                ------------
Total increase in net assets.........................................................................
                                                                                                                  54,469,486
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,000
                                                                                                                ------------
  End of period......................................................................................
                                                                                                               $  54,569,486*
                                                                                                                ------------
                                                                                                                ------------
</TABLE>

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

*   Includes undistributed net investment income of $13,178.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 76
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                              FINANCIAL HIGHLIGHTS

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

Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.

<TABLE>
<CAPTION>
                                                                        CLASS A                        CLASS B
                                                              ----------------------------   ----------------------------
                                                                      MAY 31, 1994                   MAY 31, 1994
                                                              (COMMENCEMENT OF OPERATIONS)   (COMMENCEMENT OF OPERATIONS)
                                                                  TO OCTOBER 31, 1994            TO OCTOBER 31, 1994
                                                              ----------------------------   ----------------------------
<S>                                                           <C>                            <C>
Per Share Operating Performance:
Net asset value, beginning of the period....................            $ 11.43                        $ 11.43
                                                                       --------                       --------
Income from investment operations:
  Net investment income (loss)..............................               0.01*                         (0.01)*
  Net realized and unrealized gain on investments...........               1.03                           1.03
                                                                       --------                       --------
  Net increase from investment operations...................               1.04                           1.02
                                                                       --------                       --------
Net asset value, end of period..............................            $ 12.47                        $ 12.45
                                                                       --------                       --------
                                                                       --------                       --------

Total investment return (c).................................              9.10%(b)                       8.92%(b)

Ratios and supplemental data:
Net assets, end of period (in 000's)........................            $23,615                        $30,954
Ratio of net investment income (loss) to average net
 assets.....................................................              0.41%(a)*                    (0.09)%(a)*
Ratio of net expenses to average net assets.................              2.40%(a)*                      2.90%(a)*
</TABLE>

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

 (a) Annualized.

 (b) Not annualized.

 (c) Total investment return does not include sales charges.

  * The annualized ratios of operating expenses and net investment income to
    average net assets for Class A and Class B before reimbursement by G.T.
    Capital Management, Inc. for the period ended October 31, 1994 would have
    been 3.28% and (0.47)%; and 3.78% and (0.97)%, respectively. The net
    investment income per share would have been reduced by $0.02 for each class.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 77
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Infrastructure Fund ("Fund") is a separate series of G.T. Investment
Funds, Inc. ("Company"). The Company is organized as a Maryland corporation and
is registered under the Investment Company Act of 1940, as amended ("1940 Act"),
as a diversified, open-end management investment company. The Company has eleven
series of shares in operation, each series corresponding to a distinct portfolio
of investments. The Fund invests substantially all of its investable assets in
Global Infrastructure Portfolio ("Portfolio"), which is registered as an
open-end management investment company under the 1940 Act and has investment
objectives, policies and limitations substantially identical to those of the
Fund. The value of the Fund's investment in the Portfolio reflects the Fund's
proportionate interest in the net assets of the Portfolio. The financial
statements of the Portfolio, including the Portfolio of Investments, are
included elsewhere in this Report and should be read in conjunction with the
Fund's financial statements.

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.

(A)  INVESTMENT VALUATION
Valuation of securities and other investment practices by the Portfolio are
discussed in Note 1 of the Portfolio's Notes to Financial Statements which are
included elsewhere in this Report.

(B)  TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains. The Fund currently has a capital loss carryforward of $26,214
which expires in 2002.

(C)  DISTRIBUTION TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Portfolio and timing differences.

(D)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $51,500. These expenses
are being amortized on a straightline basis over a five-year period.

2. RELATED PARTIES
G.T. Capital Management, Inc. ("G.T. Capital") is the Fund's administrator. The
Fund pays administration fees to G.T. Capital at the annualized rate of 0.25% of
the Fund's average daily net assets. These fees are computed daily and paid
monthly, and are subject to reduction in any year to the extent that the Fund's
expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary expenses) exceed the most
stringent limits prescribed by the laws or regulations of any state in which the
Fund's shares are offered for sale, based on the average total net asset value
of the Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended October 31, 1994, G.T. Global retained
$51,215 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.

                  Statement of Additional Information Page 78
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. For the period ended October 31,
1994, G.T. Global collected CDSCs in the amount of $1,528. In addition, G.T.
Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate plans of distribution with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.50% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expenses) to the maximum annual rate of 2.40% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of administration
fees, waivers by G.T. Global of payments under the Class A Plan and/ or Class B
Plan and/or reimbursements by G.T. Capital or G.T. Global of portions of the
Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

                  Statement of Additional Information Page 79
<PAGE>
                         GT GLOBAL INFRASTRUCTURE FUND

3. CAPITAL SHARES
At October 31, 1994, there were 6,000,000,000 shares of the Company's common
stock authorized, at $0.0001 par value. Of this amount, 200,000,000 were
classified as shares of the Fund; 400,000,000 were classified as shares of G.T.
Global Government Income Fund; 200,000,000 were classified as shares of G.T.
Global Health Care Fund; 200,000,000 were classified as shares of G.T. Global
Emerging Markets Fund; 200,000,000 were classified as shares of G.T. Global
Currency Fund (inactive); 200,000,000 were classified as shares of G.T. Global
Growth & Income Fund; 200,000,000 were classified as shares of G.T. Global Small
Companies Fund (inactive); 200,000,000 were classified as shares of G.T. Latin
America Growth Fund; 400,000,000 were classified as shares of G.T. Global
Telecommunications Fund; 200,000,000 were classified as shares of G.T. Global
Strategic Income Fund; 200,000,000 were classified as shares of G.T. Global High
Income Fund; 200,000,000 were classified as shares of G.T. Global Natural
Resources Fund; 200,000,000 were classified as shares of G.T. Global Financial
Services Fund; 200,000,000 were classified as shares of G.T. Global Consumer
Products and Services Fund (inactive); and 2,800,000,000 shares remain
unclassified. The shares of each of the foregoing series of the Company were
divided equally into two classes, designated Class A and Class B common stock.
Transactions in capital shares of the Fund were as follows:

                           CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
                                                                                                                  MAY 31, 1994
                                                                                                                (COMMENCEMENT OF
                                                                                                                  OPERATIONS)
                                                                                                              TO OCTOBER 31, 1994
                                                                                                             ----------------------
CLASS A                                                                                                       SHARES      AMOUNT
- -----------------------------------------------------------------------------------------------------------  ---------  -----------
<S>                                                                                                          <C>        <C>
Shares sold................................................................................................  2,020,133  $24,648,202
Shares repurchased.........................................................................................   (131,239)  (1,614,053)
                                                                                                             ---------  -----------
Net increase...............................................................................................  1,888,894  $23,034,149
                                                                                                             ---------  -----------
                                                                                                             ---------  -----------

<CAPTION>

                                                                                                                  MAY 31, 1994
                                                                                                                (COMMENCEMENT OF
                                                                                                                  OPERATIONS)
                                                                                                              TO OCTOBER 31, 1994
                                                                                                             ----------------------
CLASS B                                                                                                       SHARES      AMOUNT
- -----------------------------------------------------------------------------------------------------------  ---------  -----------
<S>                                                                                                          <C>        <C>
Shares sold................................................................................................  2,557,551  $31,291,166
Shares repurchased.........................................................................................    (75,739)    (930,598)
                                                                                                             ---------  -----------
Net increase...............................................................................................  2,481,812  $30,360,568
                                                                                                             ---------  -----------
                                                                                                             ---------  -----------
</TABLE>

                  Statement of Additional Information Page 80
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Trustees of
Global Infrastructure Portfolio:

We have audited the accompanying statement of assets and liabilities of Global
Infrastructure Portfolio, including the schedule of portfolio investments, as of
October 31, 1994 and the related statement of operations, statement of changes
in net assets and supplementary data for the period from May 31, 1994
(commencement of operations) to October 31, 1994. These financial statements and
the supplementary data are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial statements and the
supplementary data based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the supplementary data are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the supplemenatary data referred to
above present fairly, in all material respects, the financial position of Global
Infrastructure Portfolio as of October 31, 1994 and the results of its
operations, the changes in its net assets and the supplementary data for the
period from May 31, 1994 (commencement of operations) to October 31, 1994, in
conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 81
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                            PORTFOLIO OF INVESTMENTS

                                October 31, 1994

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                     Market        % of Net
Equity Investments         Country      Shares        Value       Assets(a)
<S>                      <C>          <C>         <C>            <C>
- -----------------------------------------------------------------------------
Electrical & Gas Utilities (21.0%)
- ------------------------------------------------
Korea Electric Power
 ADR (b)                        KOR       74,900     $1,460,550         2.8
Companhia Energetica de
 Minas Gerais (Cemig)
 ADR (b)(c)(d)                 BRZL       50,000      1,323,895         2.6
EVN (Energie Versorgung
 Niedr)                       ASTRI        9,000      1,131,858         2.2
Capex S.A. (c)                  ARG      110,000      1,068,473         2.1
Empresa Nacional de
 Electridad S.A.
 (Endesa) ADR (b)               SPN       23,100      1,059,713         2.1
Edison S.P.A.                  ITLY      245,000      1,048,350         2.1
Chilegener S.A. ADR (b)        CHLE       35,000        988,750         1.9
Consolidated Electric
 Power Asia                      HK      350,000        817,587         1.6
AES China Generating
 Co. Ltd. Class A (c)            US       54,100        608,625         1.2
Huaneng Power
 International, Inc.
 ADR (b)(c)                    CHNA       30,000        555,000         1.1
Bolivian Power (b)              BOL       22,000        533,500         1.0
Hong Kong Electric               HK       43,000        135,227         0.3
                                                  -------------
                                                     10,731,528
                                                  -------------
Telephone Networks (15.3%)
- ------------------------------------------------
Stet (Societa
 Finanziara Telefonica)
 Savings                  ITLY           532,000      1,316,378          2.6
Telecomunicacoes
 Brasileiras S.A. -
 Telebras Sponsored ADR
 (b)                      BRZL            23,113      1,190,320          2.3
Telefonica de Espana
 ADR (b)                  SPN             28,000      1,134,120          2.2
Telecom Corporation of
 New Zealand Ltd. ADR
 (b)                      NZ              20,000      1,112,500          2.2
PT Indonesia Satellite
 (Indosat) ADR (b)(c)     INDO            27,000      1,059,750          2.1
Telefonos de Mexico,
 S.A. de C.V. "L" ADR
 (b)                      MEX             16,000        882,000          1.7

<CAPTION>
                                                     Market        % of Net
Equity Investments         Country      Shares        Value       Assets(a)
<S>                      <C>          <C>         <C>            <C>
- -----------------------------------------------------------------------------

Pakistan Telecommu-
 nications Company Ltd.
 (c):                           PAK           --             --         1.4
  Common                         --        2,800       $445,912          --
  Vouchers 144A (b)(d)           --        1,392        230,376          --
Telecom Argentina S.A.
 "B"                            ARG       63,000        383,385         0.8
                                                  -------------
                                                      7,754,741
                                                  -------------

Cement (12.4%)
- ------------------------------------------------
Siam Cement Co. Ltd.
 (Foreign)                     THAI       24,000      1,384,912         2.7
Cementos Paz del Rio.
 S.A. 144A ADR (b)(d)           COL       48,500      1,200,375         2.3
Giant Cement Holdings,
 Inc. (c)                        US       75,000      1,050,000         2.1
La Cemento Nacional
 144A GDR (b)(c)(d)            ECDR        3,000      1,050,000         2.1
Lone Star Industries,
 Inc.                            US       50,000        968,555         1.9
Corporacion Cementera
 Argentina S.A.
 (Corcemar) (c)                 ARG       43,247        359,272         0.7
PT Semen Cibinong
 (Foreign)                     INDO       86,000        304,880         0.6
                                                  -------------
                                                      6,317,994
                                                  -------------

Telecom Equipment (11.4%)
- ------------------------------------------------
Nokia AB (Preferred)
 ADR (b)(c)               FIN             21,200      1,592,650          3.1
Motorola, Inc.            US              20,000      1,177,500          2.3
Allgon AB-B Free          SWDN            50,000      1,127,286          2.2
BroadBand Technologies,
 Inc. (c)                 US              40,000      1,035,000          2.0
Champion Technology
 Holdings                 HK           2,800,000        905,912          1.8
                                                  -------------
                                                      5,838,348
                                                  -------------

Machinery & Engineering (6.3%)
- ------------------------------------------------
Mannesmann AG             GER              5,200      1,390,541          2.7
Caterpillar, Inc.         US              20,000      1,195,180          2.3
United Engineers
 (Malaysia) Ltd.          MAL            125,000        675,279          1.3
                                                  -------------
                                                      3,261,000
                                                  -------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 82
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO
<TABLE>
<CAPTION>
                                                     Market        % of Net
Equity Investments         Country      Shares        Value       Assets(a)
- -----------------------------------------------------------------------------
<S>                      <C>          <C>         <C>            <C>
Transportation - Road & Rail (5.9%)
- ------------------------------------------------
ABC Rail Products
 Corporation (c)                 US       60,000     $1,335,438         2.6
Conrail, Inc.                    US       22,000      1,198,088         2.3
East Japan Railway Co.          JPN           95        473,823         0.9
Covenant Transport Inc.
 Class A                         US        2,300         43,700         0.1
                                                  -------------
                                                      3,051,049
                                                  -------------
Electrical Plant/Equipment (3.8%)
- ------------------------------------------------
ASEA AB-B Free            SWDN            16,700      1,213,210          2.4
E.R.G. Australia
 Limited (c)              AUSL           400,000        725,165          1.4
                                                  -------------
                                                      1,938,375
                                                  -------------

Construction (3.6%)
- ------------------------------------------------
Fluor Corporation         US              22,000      1,089,168          2.1
Grupo Tribasa, S.A. de
 C.V. Sponsored ADR
 (b)(c)                   MEX             25,000        784,375          1.5
                                                  -------------
                                                      1,873,543
                                                  -------------

Telephone - Long Distance (3.5%)
- ------------------------------------------------
IDB Communications
 Group, Inc. (c)          US             191,000      1,766,750          3.5

Wireless Communications (2.7%)
- ------------------------------------------------
Centennial Cellular
 Corporation Class A
 (c)                      US              80,000      1,400,000          2.7
Conglomerate (2.2%)
- ------------------------------------------------
General Electric
 Company                  US              23,000      1,124,994          2.2
<CAPTION>
                                                     Market        % of Net
Equity Investments         Country      Shares        Value       Assets(a)
<S>                      <C>          <C>         <C>            <C>
- -----------------------------------------------------------------------------

Metals - Steel (2.1%)
- ------------------------------------------------
Hylsamex S.A. de C.V.
 144A ADR (b)(d)                MEX       49,000     $1,078,000         2.1

Gas Production & Distribution (2.0%)
- ------------------------------------------------
Williams Companies,
 Inc.                     US              36,000      1,044,000          2.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Equity Investments
 (cost $45,920,654).............................     47,180,322         92.2
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Fixed Income                          Principal
Investment                Currency      Amount
<S>                      <C>          <C>         <C>            <C>
- ------------------------------------------------

Philippines Corporate Bond (1.7%)
- ------------------------------------------------
International Container
 Terminal Services,
 Conv. Bond, 5% due
 9/15/01 144A (d) (cost
 $1,000,000)              USD          1,000,000        850,000          1.7
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Short-Term Investment
- -----------------------
<S>                      <C>          <C>         <C>            <C>

Repurchase Agreement (17.3%)
- ------------------------------------------------
Dated October 31, 1994 with State Street Bank &
 Trust Company, due November 1, 1994, for an
 effective yield of 4.7% collateralized by
 $9,000,000 Federal Home Loan Mortgage
 Corporation Note, 6% due 5/15/20. (Market value
 $8,865,000, including accrued interest.) (cost
 $8,820,151)....................................      8,820,151         17.3
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Investments (cost $55,740,805)*...........     56,850,473        111.2
Liabilities Less Other Assets...................     (5,743,683)       (11.2 )
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Net Assets......................................    $51,106,790        100.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a)  Percentages indicated are based on net assets of $51,106,790.
(b)  U.S. currency denominated.
(c)  Non-income producing security.
(d)  Security exempt from registration under Rule 144A of the Securities Act of
     1933. These securities may be resold in transactions exempt from
     registration, normally to qualified institutional buyers.

Abbreviations:
ADR -- American Depository Receipt
GDR -- Global Depository Receipt
*      For Federal income tax purposes, cost is $55,740,805 and appreciation
       (depreciation) of securities is as follows:

Unrealized appreciation:    $2,286,910
Unrealized depreciation:    (1,177,242)
                            ----------
Net unrealized
appreciation:               $1,109,668
                            ----------
                            ----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 83
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

The Fund's Portfolio of Investments at October 31, 1994, was concentrated in the
following countries:

<TABLE>
<CAPTION>
                                                Percentage of Net Assets (a)
                                -------------------------------------------------------------
                                                Fixed
                                  Equity       Income     Short- Term     Other       Total
                                -----------  -----------  -----------  -----------  ---------
<S>                             <C>          <C>          <C>          <C>          <C>
Argentina                               3.6                                               3.6
Austria                                 2.2                                               2.2
Australia                               1.4                                               1.4
Bolivia                                 1.0                                               1.0
Brazil                                  4.9                                               4.9
Chile                                   1.9                                               1.9
China                                   1.1                                               1.1
Colombia                                2.3                                               2.3
Ecuador                                 2.1                                               2.1
Finland                                 3.1                                               3.1
Germany                                 2.7                                               2.7
Hong Kong                               3.7                                               3.7
Indonesia                               2.7                                               2.7
Italy                                   4.7                                               4.7
Japan                                   0.9                                               0.9
Korea                                   2.8                                               2.8
Malaysia                                1.3                                               1.3
Mexico                                  5.3                                               5.3
New Zealand                             2.2                                               2.2
Pakistan                                1.4                                               1.4
Philippines                                         1.7                                   1.7
Spain                                   4.3                                               4.3
Sweden                                  4.6                                               4.6
Thailand                                2.7                                               2.7
U.S.                                   29.3                      17.3        (11.2)      35.4
                                                   --
                                      ---                       ---         -----   ---------
Total                                  92.2         1.7          17.3        (11.2)     100.0
                                                   --
                                                   --
                                      ---                       ---         -----   ---------
                                      ---                       ---         -----   ---------
<FN>
- ----------------
(a)  Percentages indicated are based on net assets of $51,106,790.
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 84
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<S>                                                                                           <C>        <C>
Assets:
  Investments in securities, at value (cost $46,920,654) (Note 1)......................................  $  48,030,322
  Repurchase agreements (cost $8,820,151) (Note 1).....................................................      8,820,151
  Foreign currency (cost $133,633)..........................................................
                                                                                              $ 132,697
  U.S. currency.............................................................................
                                                                                                    177        132,874
                                                                                              ---------
  Receivable for securities sold.......................................................................      2,554,855
  Dividends receivable.................................................................................         92,438
  Unamortized deferred organizational expenses (Note 1)................................................         22,917
  Interest receivable..................................................................................          6,389
  Prepaid expenses.....................................................................................            234
  Cash held as collateral for securities loaned (Note 1)...............................................      3,542,400
                                                                                                         -------------
  Total assets.........................................................................................     63,202,580
                                                                                                         -------------
Liabilities:
  Payable for securities purchased.....................................................................      8,476,673
  Payable for investment management and administration fees (Note 2)...................................         32,978
  Payable for deferred organizational expenses.........................................................         25,000
  Payable for professional fees........................................................................         12,040
  Payable for Trustees' fees (Note 2)..................................................................          1,368
  Accrued expenses.....................................................................................          5,331
  Collateral for securities loaned (Note 1)............................................................      3,542,400
                                                                                                         -------------
  Total liabilities....................................................................................     12,095,790
                                                                                                         -------------
Net assets.............................................................................................  $  51,106,790
                                                                                                         -------------
                                                                                                         -------------
Net assets consist of:
  Paid in capital......................................................................................  $  49,920,685
  Undistributed net investment income..................................................................        124,514
  Accumulated net realized loss on investments and foreign currency conversions........................        (49,221)
  Net unrealized appreciation of investments, dividends receivable, interest receivable, securities
   purchased and sold and foreign currency conversions.................................................      1,110,812
                                                                                                         -------------
  Total -- representing net assets applicable to shares of beneficial interest outstanding.............  $  51,106,790
                                                                                                         -------------
                                                                                                         -------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 85
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                            <C>         <C>
Investment income (Note 1):
  Dividend (net of withholding tax of $5,467)............................................................  $  121,069
  Interest...............................................................................................     104,902
                                                                                                           ----------
  Total investment income................................................................................     225,971
                                                                                                           ----------
Expenses:
  Investment management and administration fees (Note 2).................................................      51,922
  Professional fees......................................................................................      18,770
  Custodian fees (Note 1)................................................................................      14,594
  Printing and postage expenses..........................................................................       9,650
  Amortization of organizational expenses (Note 1).......................................................       2,083
  Trustees' fees (Note 2)................................................................................       2,908
  Other..................................................................................................       1,530
                                                                                                           ----------
  Total expenses.........................................................................................     101,457
                                                                                                           ----------
Net investment income....................................................................................     124,514
                                                                                                           ----------
Net realized and unrealized loss on investments and foreign currencies (Note 1):
  Net realized loss on investments...........................................................  $  (27,320)
  Net realized loss on foreign currency conversions..........................................     (21,901)
                                                                                               ----------
  Net realized loss......................................................................................     (49,221)
  Increase in unrealized appreciation of dividends receivable, interest receivable,
   securities purchased and sold, and foreign currency conversions...........................       1,144
  Increase in unrealized appreciation of investments.........................................   1,109,668
                                                                                               ----------
  Net unrealized appreciation............................................................................   1,110,812
                                                                                                           ----------
Net realized and unrealized gain on investments and foreign currency conversions.........................   1,061,591
                                                                                                           ----------
Net increase in net assets resulting from operations.....................................................  $1,186,105
                                                                                                           ----------
                                                                                                           ----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 86
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment income..............................................................................
                                                                                                               $     124,514
  Net realized loss on investments and foreign currency conversions..................................
                                                                                                                     (49,221)
  Increase in unrealized appreciation of investments, dividends receivable, interest receivable,
   securities purchased and sold and foreign currency conversions....................................
                                                                                                                   1,110,812
                                                                                                                ------------
  Net increase in net asssets resulting from operations..............................................
                                                                                                                   1,186,105
Beneficial interest transactions:
  Contributions......................................................................................
                                                                                                                  52,494,964
  Withdrawals........................................................................................
                                                                                                                  (2,674,379)
                                                                                                                ------------
  Net increase from beneficial interest transactions.................................................
                                                                                                                  49,820,585
                                                                                                                ------------
Total increase in net assets.........................................................................
                                                                                                                  51,006,690
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,100
                                                                                                                ------------
  End of period......................................................................................
                                                                                                               $  51,106,790*
                                                                                                                ------------
                                                                                                                ------------
</TABLE>

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

*   Includes undistributed net investment income of $124,514.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 87
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                               SUPPLEMENTARY DATA

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

Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Ratios and supplemental data:
Net assets, end of period (in 000's).................................................................            $  51,107
Ratio of net investment income to average net assets.................................................                1.44%(a)
Ratio of expenses to average net assets..............................................................                1.17%(a)
Portfolio turnover rate..............................................................................                  18%
</TABLE>

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

(a) Annualized.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 88
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
Global Infrastructure Portfolio ("Portfolio") is organized as a New York Trust
and is registered under the Investment Company Act of 1940, as amended ("1940
Act"), as a non-diversified, open-end management investment company. The
following is a summary of significant accounting policies consistently followed
by the Portfolio in the preparation of the financial statements. The policies
are in conformity with generally accepted accounting principles.

(A)  PORTFOLIO VALUATION
The Portfolio calculates the net asset value of and completes orders to
purchase, exchange or repurchase Portfolio shares of beneficial interest on each
business day, with the exception of those days on which the New York Stock
Exchange is closed.

Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or in the principal over-the-counter market in which
such securities are traded as of the close of business on the day the securities
are being valued or, lacking any sales, at the last available bid price. In
cases where securities are traded on more than one exchange, the securities are
valued on the exchange determined by G.T. Capital Management, Inc. ("G.T.
Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuations, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Portfolio's Board of Trustees.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Portfolio's Board of Trustees.

(B)  FOREIGN CURRENCY TRANSLATION
The accounting records of the Portfolio are maintained in U.S. dollars. The
market values of foreign securities, currency holdings, other assets and
liabilities are recorded in the books and records of the Portfolio after
translation to U.S. dollars based on the exchange rates on that day. The cost of
each security is determined using historical exchange rates. Income and
withholding taxes are translated at prevailing exchange rates when accrued or
incurred.

The Portfolio does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss from
investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currency conversions, currency gains or losses realized between the
trade and settlement dates on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Portfolio's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities at fiscal year end, resulting from changes in the exchange rate.

In addition, the Portfolio may focus its investments in certain related
infrastructure industries, subjecting the Portfolio to greater risk than a fund
that is more diversified.

                  Statement of Additional Information Page 89
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

(C)  REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Portfolio, it is the
Portfolio's policy to always receive, as collateral, United States government
securities or other high quality debt securities of which the value, including
accrued interest, is at least equal to the amount to be paid to the Portfolio
under each agreement at its maturity.

(D)  FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Portfolio as an unrealized gain or loss. When the Forward is closed, the
Portfolio records a realized gain or loss equal to the difference between the
value at the time it was opened and the value at the time it was closed. The
Portfolio could be exposed to risk if a counterparty is unable to meet the terms
of the contract or if the value of the currency changes unfavorably. The
Portfolio may enter into Forwards in connection with planned purchases or sales
of securities or to hedge the value of portfolio securities denominated in a
foreign currency.

(E)  OPTION ACCOUNTING PRINCIPLES
When the Portfolio writes a call or put option, an amount equal to the premium
received is included in the Portfolio's "Statement of Assets and Liabilities" as
an asset and an equivalent liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the option.
The current market value of an option listed on a traded exchange is valued at
its last settlement price, or in the case of an over-the-counter option is
valued at the bid price obtained from a broker. If an option expires on its
stipulated expiration date or if the Portfolio enters into a closing purchase
transaction, a gain or loss is realized without regard to any unrealized gain or
loss on the underlying security, and the liability related to such option is
extinguished. If a written call option is exercised, a gain or loss is realized
from the sale of the underlying security and the proceeds of the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the underlying security purchased would be decreased by
the premium originally received. The Portfolio can write options only on a
covered basis, which for calls requires that the Portfolio hold the underlying
security and which for puts requires the Portfolio to set aside cash, U.S.
government securities or other liquid, high-grade debt securities in an amount
not less than the exercise price or otherwise provide adequate cover at all
times while the put option is outstanding. At October 31, 1994, the Portfolio
had no written options.

The premium paid by the Portfolio for the purchase of a call or put option is
included in the Portfolio's "Statement of Assets and Liabilities" as an
investment and subsequently "marked-to-market" to reflect the current market
value of the option. If an option which the Portfolio has purchased expires on
the stipulated expiration date, the Portfolio realizes a loss in the amount of
the cost of the option. If the Portfolio enters into a closing sale transaction,
the Portfolio realizes a gain or loss, depending on whether proceeds from the
closing sale transaction are greater or less than the cost of the option. If the
Portfolio exercises a call option, the cost of the securities acquired by
exercising the call is increased by the premium paid to buy the call. If the
Portfolio exercises a put option, it realizes a gain or loss from the sale of
the underlying security, and the proceeds from such sale are decreased by the
premium originally paid. At October 31, 1994, the Portfolio had no outstanding
purchased options.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Portfolio may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Portfolio may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Portfolio may not be able to enter into a closing transaction because of an
illiquid secondary market.

(F)  FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Portfolio is required to pledge to the broker an amount of cash or securities
equal to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Portfolio agrees to receive
from or pay to the broker an amount of cash equal to the daily fluctuation in
value of the contract. Such receipts or payments are known as "variation margin"
and are recorded by the Portfolio as unrealized gains or losses. When the
contract is closed, the Portfolio records a realized gain or loss equal to the
difference between the value of the contract at the time it was opened and the
value at the time it was closed. The potential risk to the Portfolio is that the
change in value of the underlying securities may not correlate to the change in
value of the contracts. At October 31, 1994, the Portfolio did not hold futures
contracts.

                  Statement of Additional Information Page 90
<PAGE>
                        GLOBAL INFRASTRUCTURE PORTFOLIO

(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Portfolio may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Portfolio to subsequently invest at
less advantageous prices.

(H)  PORTFOLIO SECURITIES LOANED
At October 31, 1994, stocks with an aggregate value of approximately $3,410,637
were on loan to brokers. The loans were secured by cash collateral of
$3,542,400. For international securities, cash collateral is received by the
Portfolio against loaned securities in an amount at least equal to 105% of the
market value of the loaned securities at the inception of each loan. This
collateral must be maintained at not less than 103% of the market value of the
loaned securities during the period of the loan. For domestic securities, cash
collateral is received by the Portfolio against loaned securities in an amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. For
the period ended October 31, 1994, the Portfolio received fees of $584 of income
from securities lending.

(I)  TAXES
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code of 1986, as amended ("Code"). Therefore, no provision has been made
for Federal taxes on income, capital gains, or unrealized appreciation of
securities held.

(J)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Portfolio in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $25,000. These expenses
are being amortized on a straightline basis over a five-year period.

(K)  FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Portfolio's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(L)  INDEXED SECURITIES
The Portfolio may invest in indexed securities whose value is linked either
directly or indirectly to changes in foreign currencies, interest rates,
equities, indices, or other reference instruments. Indexed securities may be
more volatile than the reference instrument itself, but any loss is limited to
the amount of the original investment.

2. RELATED PARTIES
G.T. Capital is the Portfolio's investment manager and administrator. The
Portfolio pays investment management and administration fees to G.T. Capital at
the annualized rate of 0.725% on the first $500 million of average daily net
assets of the Portfolio; 0.70% on the next $500 million; 0.675% on the next $500
million; and 0.65% on amounts thereafter. These fees are computed daily and paid
monthly.

The Portfolio pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global Financial Services, Inc. or G.T. Global
Investor Services, Inc. $500 per year plus $150 for each meeting of the board or
any committee thereof attended by the Trustees.

At October 31, 1994, all of the shares of beneficial interest of the Portfolio
were owned either by G.T. Global Infrastructure Fund or G.T. Capital.

3. PURCHASES AND SALES OF SECURITIES
For the period ended October 31, 1994, purchases and sales of investment
securities by the Portfolio, other than U.S. government obligations and
short-term investments, aggregated $50,619,297 and $3,671,323, respectively.
There were no purchases or sales of U.S. government obligations by the Portfolio
for the period ended October 31, 1994.

                  Statement of Additional Information Page 91
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Directors of
G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global Natural Resources Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., as of October 31, 1994 and the related statement of
operations, the statement of changes in net assets and the financial highlights
for the period from May 31, 1994 (commencement of operations) to October 31,
1994. These financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and the financial highlights based on our
audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the financial highlights
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Natural Resources Fund as of October 31, 1994 and the results of its
operations, the changes in its net assets and the financial highlights for the
period from May 31, 1994 (commencement of operations) to October 31, 1994, in
conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 92
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<S>                                                                                                       <C>
Assets:
  Investments in Global Natural Resources Portfolio (cost $26,271,048) (Note 1).........................
                                                                                                          $26,949,639
  Receivable for Fund shares sold.......................................................................
                                                                                                            1,297,467
  Receivable for expense reimbursement (Note 2).........................................................
                                                                                                               88,584
  Unamortized deferred organizational expenses (Note 1).................................................
                                                                                                               47,154
                                                                                                          -----------
  Total assets..........................................................................................
                                                                                                           28,382,844
                                                                                                          -----------
Liabilities:
  Payable for Fund shares repurchased...................................................................
                                                                                                              117,510
  Payable for registration fees.........................................................................
                                                                                                               15,149
  Payable for service and distribution expenses (Note 2)................................................
                                                                                                               14,658
  Payable for printing and postage expenses.............................................................
                                                                                                               12,279
  Payable for professional fees.........................................................................
                                                                                                               11,870
  Payable for Administration fees (Note 2)..............................................................
                                                                                                                4,966
  Payable for custodian fees............................................................................
                                                                                                                3,562
  Payable for Directors' fees (Note 2)..................................................................
                                                                                                                1,014
  Accrued expenses......................................................................................
                                                                                                                1,427
                                                                                                          -----------
  Total liabilities.....................................................................................
                                                                                                              182,435
                                                                                                          -----------
Net assets..............................................................................................
                                                                                                          $28,200,409
                                                                                                          -----------
                                                                                                          -----------
Class A:
Net asset value and redemption price per share
 ($14,796,806 DIVIDED BY 1,192,523 shares outstanding)..................................................
                                                                                                          $     12.41
                                                                                                          -----------
                                                                                                          -----------
Maximum offering price per share
 (100/95.25 of $12.41)*.................................................................................
                                                                                                          $     13.03
                                                                                                          -----------
                                                                                                          -----------
Class B:+
Net asset value and offering price per share
 ($13,403,603 DIVIDED BY 1,082,698 shares outstanding)..................................................
                                                                                                          $     12.38
                                                                                                          -----------
                                                                                                          -----------
Net assets consist of:
  Paid in capital (Note 3)..............................................................................
                                                                                                          $27,550,552
  Undistributed net investment income...................................................................
                                                                                                              106,264
  Accumulated net realized loss on investments and foreign currency conversions -- Global Natural
   Resources Portfolio..................................................................................
                                                                                                             (130,259)
  Net unrealized appreciation of investments, dividends receivable, securities purchased and sold and
   foreign currency conversions -- Global Natural Resources Portfolio...................................
                                                                                                              673,852
                                                                                                          -----------
  Total -- representing net assets applicable to capital shares outstanding.............................
                                                                                                          $28,200,409
                                                                                                          -----------
                                                                                                          -----------
</TABLE>

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

*   On sales of $50,000 or more, the offering price is reduced.

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 93
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                        <C>           <C>
Investment income (Note 1):
  Dividend income -- Global Natural Resources Portfolio................................................  $    181,185
  Interest income -- Global Natural Resources Portfolio................................................        41,311
                                                                                                         ------------
  Total investment income..............................................................................       222,496
                                                                                                         ------------
Expenses:
  Expenses -- Global Natural Resources Portfolio.......................................................        85,185
  Service and distribution expenses (Note 2)
    Class A..............................................................................  $     11,282
    Class B..............................................................................        19,180        30,462
                                                                                           ------------
  Transfer agent fees (Note 2).........................................................................        23,200
  Printing and postage expenses........................................................................        19,432
  Professional fees....................................................................................        14,052
  Administration fees (Note 2).........................................................................        10,436
  Registration fees....................................................................................         7,442
  Directors' fees (Note 2).............................................................................         5,090
  Amortization of organizational expenses (Note 1).....................................................         4,346
  Custodian fees.......................................................................................         3,641
  Other................................................................................................         1,530
                                                                                                         ------------
  Total expenses before expense reimbursement..........................................................       204,816
  Less expense reimbursement (Note 2)..................................................................       (88,584)
                                                                                                         ------------
  Total expenses.......................................................................................       116,232
                                                                                                         ------------
Net investment income..................................................................................       106,264
                                                                                                         ------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
  Net realized loss on investments -- Global Natural Resources Portfolio.................      (180,800)
  Net realized gain on foreign currency conversions -- Global Natural Resources
   Portfolio.............................................................................        50,541
                                                                                           ------------
  Net realized loss....................................................................................      (130,259)
  Increase in unrealized depreciation of dividends receivable, securities purchased and
   sold, and foreign currency conversions -- Global Natural Resources Portfolio..........        (4,739)
  Increase in unrealized appreciation of investments -- Global Natural Resources
   Portfolio.............................................................................       678,591
                                                                                           ------------
  Net unrealized appreciation..........................................................................       673,852
                                                                                                         ------------
Net realized and unrealized gain on investments and foreign currency conversions -- Global Natural
 Resources Portfolio...................................................................................       543,593
                                                                                                         ------------
Net increase in net assets resulting from operations...................................................  $    649,857
                                                                                                         ------------
                                                                                                         ------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 94
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment income..............................................................................
                                                                                                               $     106,264
  Net realized loss on investments and foreign currency conversions..................................
                                                                                                                    (130,259)
  Increase in unrealized appreciation of investments, dividends receivable, securities purchased and
   sold and foreign currency conversions.............................................................
                                                                                                                     673,852
                                                                                                                ------------
  Net increase in net asssets resulting from operations..............................................
                                                                                                                     649,857
Capital Share Transactions (Note 3):
  Increase from shares sold and reinvested...........................................................
                                                                                                                  34,666,146
  Decrease from shares repurchased...................................................................
                                                                                                                  (7,215,594)
                                                                                                                ------------
  Net increase from capital share transactions.......................................................
                                                                                                                  27,450,552
                                                                                                                ------------
Total increase in net assets.........................................................................
                                                                                                                  28,100,409
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,000
                                                                                                                ------------
  End of period......................................................................................
                                                                                                               $  28,200,409*
                                                                                                                ------------
                                                                                                                ------------
</TABLE>

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

*   Includes undistributed net investment income of $106,264.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 95
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                              FINANCIAL HIGHLIGHTS

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

Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.

<TABLE>
<CAPTION>
                                                                                  CLASS A                        CLASS B
                                                                               MAY 31, 1994                   MAY 31, 1994
                                                                       (COMMENCEMENT OF OPERATIONS)   (COMMENCEMENT OF OPERATIONS)
                                                                            TO OCTOBER 31, 1994            TO OCTOBER 31, 1994
                                                                       -----------------------------  -----------------------------
<S>                                                                    <C>                            <C>
Per Share Operating Performance:
Net asset value, beginning of period.................................            $   11.43                      $   11.43
                                                                                  --------                       --------
Income from investment operations:
  Net investment income..............................................                 0.06*                          0.03*
  Net realized and unrealized gain on investments....................                 0.92                           0.92
                                                                                  --------                       --------
  Net increase from investment operations............................                 0.98                           0.95
                                                                                  --------                       --------
Net asset value, end of period.......................................            $   12.41                      $   12.38
                                                                                  --------                       --------
                                                                                  --------                       --------

Total investment return(c)...........................................                8.57%(b)                       8.31%(b)

Ratios and supplemental data:
Net assets, end of period (in 000's).................................            $  14,797                      $  13,404
Ratio of net investment income to average net assets.................                2.63%(a)*                      2.13%(a)*
Ratio of net expenses to average net assets..........................                2.40%(a)*                      2.90%(a)*
</TABLE>

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

(a) Annualized.

(b) Not Annualized.

(c) Total investment return does not include sales charges.

*   The annualized ratios of operating expenses and net investment income to
    average net assets for Class A and Class B before expense reimbursement by
    G.T. Capital Management, Inc. for the period ended October 31, 1994 would
    have been 4.38% and 0.65%; and 4.88% and 0.15%, respectively. The net
    investment income per share would have been reduced by $0.04 for each class.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 96
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Natural Resources Fund ("Fund") is a separate series of G.T.
Investment Funds, Inc. ("Company"). The Company is organized as a Maryland
corporation and is registered under the Investment Company Act of 1940, as
amended ("1940 Act"), as a diversified, open-end management investment company.
The Company has eleven series of shares in operation, each series corresponding
to a distinct portfolio of investments. The Fund invests substantially all of
its investable assets in Global Natural Resources Portfolio ("Portfolio"), which
is registered as an open-end management investment company under the 1940 Act
and has investment objectives, policies and limitations substantially identical
to those of the Fund. The value of the Fund's investment in the Portfolio
reflects the Fund's proportionate interest in the net assets of the Portfolio.
The financial statements of the Portfolio, including the Portfolio of
Investments, are included elsewhere in this Report and should be read in
conjunction with the Fund's financial statements.

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.

(A)  INVESTMENT VALUATION
Valuation of securities and other investment practices by the Portfolio are
discussed in Note 1 of the Portfolio's Notes to Financial Statements which are
included elsewhere in this Report.

(B)  TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains. The Fund currently has a capital loss carryforward of
$103,533 which expires in 2002.

(C)  DISTRIBUTION TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Portfolio and timing differences.

(D)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $51,500. These expenses
are being amortized on a straightline basis over a five-year period.

2. RELATED PARTIES
G.T. Capital Management, Inc. ("G.T. Capital") is the Fund's administrator. The
Fund pays administration fees to G.T. Capital at the annualized rate of 0.25% of
the Fund's average daily net assets. These fees are computed daily and paid
monthly, and are subject to reduction in any year to the extent that the Fund's
expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary items) exceed the most stringent
limits prescribed by the laws or regulations of any state in which the Fund's
shares are offered for sale, based on the average total net asset value of the
Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended October 31, 1994, G.T. Global retained
$14,471 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.

                  Statement of Additional Information Page 97
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. For the period ended October 31,
1994, G.T. Global collected CDSCs in the amount of $779. In addition, G.T.
Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate plans of distribution with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.50% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expenses) to the maximum annual rate of 2.40% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of administration
fees, waivers by G.T. Global of payments under the Class A Plan and/ or Class B
Plan and/or reimbursements by G.T. Capital or G.T. Global of portions of the
Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

                  Statement of Additional Information Page 98
<PAGE>
                        GT GLOBAL NATURAL RESOURCES FUND

3. CAPITAL SHARES
At October 31, 1994, there were 6,000,000,000 shares of the Company's common
stock authorized, at $0.0001 par value. Of this amount, 200,000,000 were
classified as shares of the Fund; 400,000,000 were classified as shares of G.T.
Global Government Income Fund; 200,000,000 were classified as shares of G.T.
Global Health Care Fund; 200,000,000 were classified as shares of G.T. Global
Emerging Markets Fund; 200,000,000 were classified as shares of G.T. Global
Currency Fund (inactive); 200,000,000 were classified as shares of G.T. Global
Growth & Income Fund; 200,000,000 were classified as shares of G.T. Global Small
Companies Fund (inactive); 200,000,000 were classified as shares of G.T. Latin
America Growth Fund; 400,000,000 were classified as shares of G.T. Global
Telecommunications Fund; 200,000,000 were classified as shares of G.T. Global
Strategic Income Fund; 200,000,000 were classified as shares of G.T. Global High
Income Fund; 200,000,000 were classified as shares of G.T. Global Financial
Services Fund; 200,000,000 were classified as shares of G.T. Global
Infrastructure Fund; 200,000,000 were classified as shares of G.T. Global
Consumer Products and Services Fund (inactive); and 2,800,000,000 shares remain
unclassified. The shares of each of the foregoing series of the Company were
divided equally into two classes, designated Class A and Class B common stock.
Transactions in capital shares of the Fund were as follows:

                           CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
                                                                                                          MAY 31, 1994
                                                                                                        (COMMENCEMENT OF
                                                                                                          OPERATIONS)
                                                                                                      TO OCTOBER 31, 1994
                                                                                                     ----------------------
CLASS A                                                                                               SHARES      AMOUNT
- ---------------------------------------------------------------------------------------------------  ---------  -----------
<S>                                                                                                  <C>        <C>
Shares sold........................................................................................  1,647,315  $20,040,497
Shares repurchased.................................................................................   (459,166)  (5,648,929)
                                                                                                     ---------  -----------
Net increase.......................................................................................  1,188,149  $14,391,568
                                                                                                     ---------  -----------
                                                                                                     ---------  -----------

<CAPTION>

                                                                                                          MAY 31, 1994
                                                                                                        (COMMENCEMENT OF
                                                                                                          OPERATIONS)
                                                                                                      TO OCTOBER 31, 1994
                                                                                                     ----------------------
CLASS B                                                                                               SHARES      AMOUNT
- ---------------------------------------------------------------------------------------------------  ---------  -----------
<S>                                                                                                  <C>        <C>
Shares sold........................................................................................  1,205,189  $14,625,649
Shares repurchased.................................................................................   (126,865)  (1,566,665)
                                                                                                     ---------  -----------
Net increase.......................................................................................  1,078,324  $13,058,984
                                                                                                     ---------  -----------
                                                                                                     ---------  -----------
</TABLE>

                  Statement of Additional Information Page 99
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Trustees of
Global Natural Resources Portfolio:

We have audited the accompanying statement of assets and liabilities of Global
Natural Resources Portfolio, including the schedule of portfolio investments, as
of October 31, 1994 and the related statement of operations, statement of
changes in net assets and supplementary data for the period from May 31, 1994
(commencement of operations) to October 31, 1994. These financial statements and
the supplementary data are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial statements and the
supplementary data based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and the supplementary data are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1994 by
correspondence with the custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and the supplementary data referred to
above present fairly, in all material respects, the financial position of Global
Natural Resources Portfolio as of October 31, 1994 and the results of its
operations, the changes in its net assets and the supplementary data for the
period from May 31, 1994 (commencement of operations) to October 31, 1994, in
conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 100
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                            PORTFOLIO OF INVESTMENTS

                                October 31, 1994

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                   Market       % of Net
Equity Investments       Country      Shares        Value       Assets(a)
<S>                    <C>          <C>         <C>            <C>
- --------------------------------------------------------------------------
Metals - Non-Ferrous (22.4%)
- ----------------------------------------------
Eramet (c)                     FR        9,650       $704,954         2.6
Falconbridge Ltd.             CAN       40,500        700,213         2.6
General Mining Union
 Corporation (Gencor)       S AFR      181,000        670,287         2.5
Pasminco Limited             AUSL      376,100        631,537         2.3
Western Mining
 Corporation Holdings
 Limited                     AUSL       99,250        618,699         2.3
Rustenburg Platinum
 Holdings Limited           S AFR       18,700        540,948         2.0
Outokumpu OY "A"              FIN       23,600        499,132         1.9
Savage Resources Ltd.
 (c)                         AUSL      394,700        407,633         1.5
Hindalco Industries
 Ltd. 144A GDR (b)(d)         IND       11,000        385,000         1.4
Phelps Dodge
 Corporation                   US        5,000        306,875         1.1
Bindura Nickel               ZBBW      150,000        207,957         0.8
Compass Resources
 N.L. (c)                    AUSL      175,000        162,531         0.6
Consolidated
 Metallurgical Ind.
 (c)                        S AFR       34,700        151,434         0.6
Impala Platinum
 Holdings Ltd. ADR
 (b)                        S AFR        3,000         66,375         0.2
                                                -------------
                                                    6,053,575
                                                -------------

Chemicals (15.5%)
- ----------------------------------------------
NOVA Corporation        CAN             86,000        850,777         3.1
Dow Chemical Company    US              10,000        735,000         2.6
Mississippi Chemical
 Corporation (c)        US              34,700        615,925         2.3
Methanex Corporation
 (c)                    US              35,800        537,000         2.0
IMC Fertilizer Group,
 Inc.                   US              10,500        446,250         1.7
Cominco Fertilizers
 Ltd.                   CAN             20,000        445,636         1.7
Terra Industries,
 Inc.                   US              30,000        318,750         1.2
PT Tri Polyta
 Indonesia ADR (b)(c)   INDO             8,000        238,000         0.9
                                                -------------
                                                    4,187,338
                                                -------------

<CAPTION>
                                                   Market       % of Net
Equity Investments       Country      Shares        Value       Assets(a)
<S>                    <C>          <C>         <C>            <C>
- --------------------------------------------------------------------------
Gold (14.1%)
- ----------------------------------------------
Golden Shamrock Mines
 Ltd. (c)                    AUSL      525,000       $596,813         2.2
Acacia Resources Ltd.
 (c)                         AUSL      400,000        594,398         2.2
Ashanti Goldfields
 144A GDR (b)(c)(d)         S AFR       27,000        577,800         2.1
Kloof Gold Mining           S AFR       32,200        558,080         2.1
Perilya Mines N.L.
 (c)                         AUSL      485,500        418,441         1.6
Randgold and
 Exploration Company
 Ltd.                       S AFR       95,000        296,135         1.1
Golden Star Resources
 Ltd. (c)                      US       20,000        232,500         0.9
Free State Consoli-
 dated Gold Mines           S AFR       13,500        228,928         0.8
Randfontein Estates
 Gold Mining                S AFR       19,000        203,741         0.8
Southwestern Gold
 Corporation (c)              CAN        4,300         47,707         0.2
Mineral Resources
 Inc.                          NZ       20,000         29,720         0.1
                                                -------------
                                                    3,784,263
                                                -------------

Forest Products (11.3%)
- ----------------------------------------------
St Laurent Paperboard
 Inc. (c)               CAN            100,700      1,284,815         4.8
Carter Holt Harvey
 Limited                NZ             261,000        633,448         2.4
Sappi Limited           S AFR           32,000        534,663         2.0
Abitibi-Price, Inc.
 (Installment
 Receipt) (c)           CAN             50,600        322,800         1.2
Aracruz Celulose S.A.
 ADR (b)(c)             BRZL            20,000        255,000         0.9
                                                -------------
                                                    3,030,726
                                                -------------

Metals - Steel (7.5%)
- ----------------------------------------------
Hylsamex S.A. de C.V.
 144A ADR (b)(d)        MEX             48,100      1,058,200         3.9
Caemi Mineracao E
 Metal (Preferred)
 (c)                    BRZL         2,700,000        428,671         1.6
Cospia S.A.
 (Preferred "B") (c)    BRZL            97,000        295,367         1.1
Schnitzer Steel
 Industries, Inc.
 Class A                US              11,000        250,250         0.9
                                                -------------
                                                    2,032,488
                                                -------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 101
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO
<TABLE>
<CAPTION>
                                                   Market       % of Net
Equity Investments       Country      Shares        Value       Assets(a)
- --------------------------------------------------------------------------
<S>                    <C>          <C>         <C>            <C>
Oil (6.0%)
- ----------------------------------------------
Atlantic Richfield,
 Conv. Preferred,
 9.01% till 9/15/97            US       14,200       $385,175         1.4
Elf Aquitaine ADR (b)          FR       10,000        366,250         1.4
Cultus Petroleum N.L.
 (c)                         AUSL      486,000        317,765         1.2
Norcen Energy
 Resources, Inc.              CAN       21,200        274,408         1.0
Penn West Petroleum
 (c)                          CAN       45,000        262,112         1.0
                                                -------------
                                                    1,605,710
                                                -------------
Coal (4.5%)
- ----------------------------------------------
Randcoal Limited        S AFR           98,000        684,289         2.5
Addington Resources,
 Inc. (c)               US              50,000        537,500         2.0
                                                -------------
                                                    1,221,789
                                                -------------

Misc. Materials & Commodities (4.4%)
- -------------------------------------------------------------
Auridiam Consolidated
 N.L.                   AUSL           540,000        449,364         1.7
Reliance Industries
 Ltd. 144A GDR (b)(d)   IND             16,000        408,000         1.5
Granges, Inc. (c)       CAN             78,000        165,577         0.6
<CAPTION>
                                                   Market       % of Net
Equity Investments       Country      Shares        Value       Assets(a)
<S>                    <C>          <C>         <C>            <C>
- --------------------------------------------------------------------------
Benguela Conces-
 sions Limited (c)          S AFR      130,000       $149,127         0.6
                                                -------------
                                                    1,172,068
                                                -------------

Energy Equipment & Services (1.7%)
- -------------------------------------------------------------
Mullen Trucking Ltd.
 (c)                          CAN       42,400        270,488         1.0
Landmark Graphics
 Corporation (c)               US        9,500        194,750         0.7
                                                -------------
                                                      465,238
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Equity Investments
 (cost $22,874,604)...........................     23,553,195        87.4
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Short-Term Investment
- ----------------------------------
Repurchase Agreement (14.5%)
- ----------------------------------------------
Dated October 31, 1994 with State Street Bank
 & Trust Company, due November 1, 1994, for an
 effective yield of 4.7% collateralized by
 $4,000,000 Federal National Mortgage
 Association Note, 5.684% due 7/1/27. (Market
 value $3,938,947, including accrued
 interest.) (cost $3,919,512).................      3,919,512        14.5
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Investments (cost $26,794,116)..........     27,472,707       101.9
Liabilities Less Other Assets.................       (522,968)       (1.9 )
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Net Assets....................................    $26,949,739       100.0
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a)  Percentages indicated are based on net assets of $26,949,739.
(b)  U.S. currency denominated.
(c)  Non-income producing security.
(d)  Security exempt from registration under Rule 144A of the Securities Act of
     1933. These securities may be resold in transactions exempt from
     registration, normally to qualified institutional buyers.

Abbreviations:
ADR -- American Depository Receipt
GDR -- Global Depository Receipt
*      For Federal income tax purposes, cost is $26,811,795 and appreciation
       (depreciation) of securities is as follows:

Unrealized appreciation:    $1,321,912
Unrealized depreciation:      (661,000)
                            ----------
Net unrealized
appreciation:               $  660,912
                            ----------
                            ----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 102
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

The Fund's Portfolio of Investments at October 31, 1994, was concentrated in the
following countries:

<TABLE>
<CAPTION>
                                             Percentage of Net Assets (a)
                                  --------------------------------------------------
                                    Equity      Short-Term       Other       Total
                                  -----------  -------------  -----------  ---------
<S>                               <C>          <C>            <C>          <C>
Australia.......................         15.6                                   15.6
Brazil..........................          3.6                                    3.6
Canada..........................         17.2                                   17.2
Finland.........................          1.9                                    1.9
France..........................          4.0                                    4.0
India...........................          2.9                                    2.9
Indonesia.......................          0.9                                    0.9
Mexico..........................          3.9                                    3.9
New Zealand.....................          2.5                                    2.5
South Africa....................         17.3                                   17.3
U.S.............................         16.8         14.5           (1.9)      29.4
Zimbabwe........................          0.8                                    0.8
                                        ---          ---            ---    ---------
Total...........................         87.4         14.5           (1.9)     100.0
                                        ---          ---            ---    ---------
                                        ---          ---            ---    ---------
<FN>
- ----------------
(a)  Percentages indicated are based on net assets of $26,949,739.
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 103
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<S>                                                                                            <C>        <C>
Assets:
  Investments in securities, at value (cost $22,874,604) (Note 1).......................................  $23,553,195
  Repurchase agreements (cost $3,919,512) (Note 1)......................................................    3,919,512
  U.S. currency..............................................................................
                                                                                               $     805
  Foreign currency (cost $843,363)...........................................................
                                                                                                 833,715      834,520
                                                                                               ---------
  Receivable for securities sold........................................................................    3,000,631
  Dividends receivable..................................................................................      167,967
  Unamortized deferred organizational expenses (Note 1).................................................       22,890
  Cash held as collateral for securities loaned (Note 1)................................................      316,200
                                                                                                          -----------
  Total assets..........................................................................................   31,814,915
                                                                                                          -----------
Liabilities:
  Payable for securities purchased......................................................................    4,480,749
  Payable for deferred organizational expenses..........................................................       25,000
  Payable for investment management and administration fees (Note 2)....................................       18,057
  Payable for professional fees.........................................................................       12,028
  Payable for printing and postage expenses.............................................................        6,505
  Payable for Trustees' fees (Note 2)...................................................................        2,141
  Payable for custodian fees............................................................................        1,824
  Accrued expenses......................................................................................        2,672
  Collateral for securities loaned (Note 1).............................................................      316,200
                                                                                                          -----------
  Total liabilities.....................................................................................    4,865,176
                                                                                                          -----------
Net assets..............................................................................................  $26,949,739
                                                                                                          -----------
                                                                                                          -----------
Net assets consist of:
  Paid in capital.......................................................................................  $26,268,835
  Undistributed net investment income...................................................................      137,311
  Accumulated net realized loss on investments and foreign currency conversions.........................     (130,259)
  Net unrealized appreciation of investments, dividends receivable, securities purchased and sold and
   foreign currency converions..........................................................................      673,852
                                                                                                          -----------
  Total -- representing net assets applicable to shares of beneficial interest outstanding..............  $26,949,739
                                                                                                          -----------
                                                                                                          -----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 104
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                            STATEMENT OF OPERATIONS

         May 31, 1994 (commencement of operations) to October 31, 1994

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

<TABLE>
<S>                                                                                              <C>        <C>
Investment income (Note 1):
  Dividends (net of foreign withholding tax of $1,604)....................................................  $ 181,185
  Interest................................................................................................     41,311
                                                                                                            ---------
  Total investment income.................................................................................    222,496
                                                                                                            ---------
Expenses:
  Investment management and administration fees (Note 2)..................................................     28,500
  Custodian fees..........................................................................................     14,717
  Professional fees.......................................................................................     27,770
  Trustees' fees (Note 2).................................................................................      2,908
  Printing and postage expenses...........................................................................      7,650
  Amortization of organizational expenses (Note 1)........................................................      2,110
  Other...................................................................................................      1,530
                                                                                                            ---------
  Total expenses..........................................................................................     85,185
                                                                                                            ---------
Net investment income.....................................................................................    137,311
                                                                                                            ---------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
  Net realized loss on investments.............................................................  $(180,800)
  Net realized gain on foreign currency conversions............................................     50,541
                                                                                                 ---------
  Net realized loss.......................................................................................   (130,259)
  Increase in unrealized depreciation of dividends receivable, securities purchased and sold,
   and foreign currency conversions............................................................     (4,739)
  Increase in unrealized appreciation of investments...........................................    678,591
                                                                                                 ---------
  Net unrealized appreciation.............................................................................    673,852
                                                                                                            ---------
Net realized and unrealized gain on investments and foreign currency conversions..........................    543,593
                                                                                                            ---------
Net increase in net assets resulting from operations......................................................  $ 680,904
                                                                                                            ---------
                                                                                                            ---------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 105
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                       STATEMENT OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                               MAY 31, 1994
                                                                                                       (COMMENCEMENT OF OPERATIONS)
                                                                                                            TO OCTOBER 31, 1994
                                                                                                       -----------------------------
<S>                                                                                                    <C>
Increase in net assets
Operations:
  Net investment income..............................................................................
                                                                                                               $     137,311
  Net realized loss on investments and foreign currency conversions..................................
                                                                                                                    (130,259)
  Increase in unrealized appreciation of investments, dividends receivable, securities purchased and
   sold and foreign currency conversions.............................................................
                                                                                                                     673,852
                                                                                                                ------------
  Net increase in net asssets resulting from operations..............................................
                                                                                                                     680,904
Beneficial interest transactions:
  Contributions......................................................................................
                                                                                                                  33,302,836
  Withdrawals........................................................................................
                                                                                                                  (7,134,101)
                                                                                                                ------------
  Net increase from beneficial interest transactions.................................................
                                                                                                                  26,168,735
                                                                                                                ------------
Total increase in net assets.........................................................................
                                                                                                                  26,849,639
Net assets:
  Beginning of period................................................................................
                                                                                                                     100,100
                                                                                                                ------------
  End of period......................................................................................
                                                                                                               $  26,949,739*
                                                                                                                ------------
                                                                                                                ------------
</TABLE>

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

*   Includes undistributed net investment income of $137,311.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 106
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                               SUPPLEMENTARY DATA

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

Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.

<TABLE>
<CAPTION>
                                                                                                    MAY 31, 1994
                                                                                            (COMMENCEMENT OF OPERATIONS)
                                                                                                TO OCTOBER 31, 1994
                                                                                            ----------------------------
<S>                                                                                         <C>
Ratios and supplemental data:
Net assets, end of period (in 000's)......................................................            $26,950
Ratio of net investment income to average net assets......................................              3.47%(a)
Ratio of operating expenses to average net assets.........................................              2.15%(a)
Portfolio turnover rate...................................................................               137%
</TABLE>

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

(a) Annualized.

                  Statement of Additional Information Page 107
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
Global Natural Resources Portfolio ("Portfolio") is organized as a New York
Trust and is registered under the Investment Company Act of 1940, as amended
("1940 Act"), as a non-diversified, open-end management investment company. The
following is a summary of significant accounting policies consistently followed
by the Portfolio in the preparation of the financial statements. The policies
are in conformity with generally accepted accounting principles.

(A)  PORTFOLIO VALUATION
The Portfolio calculates the net asset value of and completes orders to
purchase, exchange or repurchase Portfolio shares of beneficial interest on each
business day, with the exception of those days on which the New York Stock
Exchange is closed.

Equity Securities are valued at the last sale price on the exchange on which
such securities are traded, or, in the principal over-the-counter market in
which such services are traded as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuations, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Portfolio's Board of Trustees.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Portfolio's Board of Trustees.

(B)  FOREIGN CURRENCY TRANSLATION
The accounting records of the Portfolio are maintained in U.S. dollars. The
market values of foreign securities, currency holdings, other assets and
liabilities are recorded in the books and records of the Portfolio after
translation to U.S. dollars based on the exchange rates on that day. The cost of
each security is determined using historical exchange rates. Income and
withholding taxes are translated at prevailing exchange rates when accrued or
incurred.

The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currency conversions, currency gains or losses realized between the
trade and settlement dates on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities at fiscal year end, resulting from changes in the exchange rate.

In addition, the Fund may focus its investments in certain related natural
resources industries, subjecting the Fund to greater risk than a fund that is
more diversified.

                  Statement of Additional Information Page 108
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

(C)  REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Portfolio, it is the
Portfolio's policy to always receive, as collateral, United States government
securities or other high quality debt securities of which the value, including
accrued interest, is at least equal to the amount to be paid to the Portfolio
under each agreement at its maturity.

(D)  FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Portfolio as an unrealized gain or loss. When the Forward is closed, the
Portfolio records a realized gain or loss equal to the difference between the
value at the time it was opened and the value at the time it was closed. The
Portfolio could be exposed to risk if a counterparty is unable to meet the terms
of the contract or if the value of the currency changes unfavorably. The
Portfolio may enter into Forwards in connection with planned purchases or sales
of securities or to hedge the value of portfolio securities denominated in a
foreign currency.

(E)  OPTION ACCOUNTING PRINCIPLES
When the Portfolio writes a call or put option, an amount equal to the premium
received is included in the Portfolio's "Statement of Assets and Liabilities" as
an asset and an equivalent liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the option.
The current market value of an option listed on a traded exchange is valued at
its last settlement price, or in the case of an over-the-counter option is
valued at the bid price obtained from a broker. If an option expires on its
stipulated expiration date or if the Portfolio enters into a closing purchase
transaction, a gain or loss is realized without regard to any unrealized gain or
loss on the underlying security, and the liability related to such option is
extinguished. If a written call option is exercised, a gain or loss is realized
from the sale of the underlying security and the proceeds of the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the underlying security purchased would be decreased by
the premium originally received. The Portfolio can write options only on a
covered basis, which for a call requires that the Portfolio holds the underlying
security and for a put requires the Portfolio to set aside cash, U.S. government
securities or other liquid, high-grade debt securities in an amount not less
than the exercise price or otherwise provide adequate cover at all times while
the put option is outstanding. At October 31, 1994, the Portfolio had no written
options.

The premium paid by the Portfolio for the purchase of a call or put option is
included in the Portfolio's "Statement of Assets and Liabilities" as an
investment and subsequently "marked-to-market" to reflect the current market
value of the option. If an option which the Portfolio has purchased expires on
the stipulated expiration date, the Portfolio realizes a loss in the amount of
the cost of the option. If the Portfolio enters into a closing sale transaction,
the Portfolio realizes a gain or loss, depending on whether proceeds from the
closing sale transaction are greater or less than the cost of the option. If the
Portfolio exercises a call option, the cost of the securities acquired by
exercising the call is increased by the premium paid to buy the call. If the
Portfolio exercises a put option, it realizes a gain or loss from the sale of
the underlying security, and the proceeds from such sale are decreased by the
premium originally paid. At October 31, 1994, the Portfolio had no outstanding
purchased options.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.

(F)  FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Portfolio is required to pledge to the broker an amount of cash or securities
equal to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Portfolio agrees to receive
from or pay to the broker an amount of cash equal to the daily fluctuation in
value of the contract. Such receipts or payments are known as "variation margin"
and are recorded by the Portfolio as unrealized gains or losses. When the
contract is closed, the Portfolio records a realized gain or loss equal to the
difference between the value of the contract at the time it was opened and the
value at the time it was closed. The potential risk to the Portfolio is that the
change in value of the underlying securities may not correlate to the change in
value of the contracts. At October 31, 1994, the Portfolio did not hold futures
contracts.

                  Statement of Additional Information Page 109
<PAGE>
                       GLOBAL NATURAL RESOURCES PORTFOLIO

(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Portfolio may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Portfolio to subsequently invest at
less advantageous prices.

(H)  PORTFOLIO SECURITIES LOANED
At October 31, 1994, stocks with an aggregate value of approximately $294,040
were on loan to brokers. The loans were secured by cash collateral of $316,200.
For international securities, cash collateral is received by the Portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the Portfolio against loaned securities in an amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. For
the period ended October 31, 1994, the Portfolio received $40 of income from
securities lending which was used to offset the Portfolio's custody expenses.

(I)  TAXES
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code of 1986, as amended ("Code"). Therefore, no provision has been made
for Federal taxes on income, capital gains, or unrealized appreciation of
securities held.

(J)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Portfolio in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $25,000. These expenses
are being amortized on a straightline basis over a five-year period.

(K)  FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Portfolio's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(L)  INDEXED SECURITIES
The Portfolio may invest in indexed securities whose value is linked either
directly or indirectly to changes in foreign currencies, interest rates,
equities, indices, or other reference instruments. Indexed securities may be
more volatile than the reference instrument itself, but any loss is limited to
the amount of the original investment.

2. RELATED PARTIES
G.T. Capital is the Portfolio's investment manager and administrator. The
Portfolio pays investment management and administration fees to G.T. Capital at
the annualized rate of 0.725% on the first $500 million of average daily net
assets of the Portfolio; 0.70% on the next $500 million; 0.675% on the next $500
million; and 0.65% on amounts thereafter. These fees are computed daily and paid
monthly.

The Portfolio pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global Financial Services, Inc. or G.T. Global
Investor Services, Inc. $500 per year plus $150 for each meeting of the board or
any committee thereof attended by the Trustees.

At October 31, 1994, all of the shares of beneficial interest of the Portfolio
were owned either by G.T. Global Natural Resources Fund or G.T. Capital.

3. PURCHASES AND SALES OF SECURITIES
For the period ended October 31, 1994, purchases and sales of investment
securities by the Portfolio, other than U.S. government obligations and
short-term investments, aggregated $37,150,485 and $14,165,894, respectively.
There were no purchases or sales of U.S. government obligations by the Portfolio
for the period ended October 31, 1994.

                  Statement of Additional Information Page 110
<PAGE>
                 GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

To the Board of Directors of
G.T. Investment Funds, Inc. and the
Shareholders of G.T. Investment Funds, Inc.:

G.T. Global Consumer Products and Services Fund

We have audited the accompanying statement of assets and liabilities of G.T.
Investment Funds, Inc. (G.T. Global Consumer Products and Services Fund) as of
December 20, 1994. The financial statement is the responsibility of the Fund's
management. Our responsibility is to express an opinion on the financial
statement based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. Our procedures included
confirmation of cash held by the custodian as of December 20, 1994. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the statement of assets and liabilities referred to above
present fairly, in all material respects, the financial position of G.T.
Investment Funds, Inc.: (G.T. Global Consumer Products and Services Fund) as of
December 20, 1994, in conformity with generally accepted accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 20, 1994

                  Statement of Additional Information Page 111
<PAGE>
                 GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                               December 20, 1994

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

<TABLE>
<CAPTION>
                                                                                                                     G.T. GLOBAL
                                                                                                                  CONSUMER PRODUCTS
                                                                                                                  AND SERVICES FUND
                                                                                                                 -------------------
<S>                                                                                                              <C>
Assets:
  Investment in Portfolio......................................................................................      $   100,000
  Unamortized deferred organization expenses (Note 2)..........................................................           51,500
                                                                                                                      ----------
    Total assets...............................................................................................          151,500
                                                                                                                      ----------
Liabilities:
  Payable for deferred organization expenses (Note 2)..........................................................           51,500
                                                                                                                      ----------
    Total liabilities..........................................................................................           51,500
                                                                                                                      ----------
  Commitments (Note 2 and 3)
NET ASSETS, applicable to 4,374.453 shares of Class A common stock at
  $0.0001 par value, and 4,374.453 shares of Class B common stock at
  $0.0001 par value, issued and outstanding (Note 1)...........................................................      $   100,000
                                                                                                                      ----------
                                                                                                                      ----------
CLASS A:
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE.................................................................      $     11.43
                                                                                                                      ----------
                                                                                                                      ----------
MAXIMUM OFFERING PRICE PER SHARE (100/95.25 of $11.43)
  reduced on sales of $50,000 or more and in certain other circumstances --
  see "How to Invest" and "How to Make Exchanges"..............................................................      $     12.00
                                                                                                                      ----------
                                                                                                                      ----------
CLASS B:+
NET ASSET VALUE AND OFFERING PRICE PER SHARE...................................................................      $     11.43
                                                                                                                      ----------
                                                                                                                      ----------
</TABLE>

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

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 112
<PAGE>
                 GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND

                             NOTES TO STATEMENT OF
                             ASSETS AND LIABILITIES

                               December 20, 1994

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

NOTE 1
G.T. Global Consumer Products and Services Fund ("Fund") is a separate series of
G.T. Investment Funds, Inc. ("Company"). The Company is organized as a Maryland
corporation and is registered under the Investment Company Act of 1940, as
amended ("1940 Act"). The Fund is classified as a diversified, open-end
management investment company. The Company has 6 billion shares of common stock
authorized at par value $0.0001. Of this amount, 200 million shares have been
classified as shares of the Fund; 100 million shares of the Fund have been
classified as Class A shares and 100 million shares of the Fund have been
classified as Class B shares.

The Fund invests substantially all its investable assets in its corresponding
Portfolio (Global Consumer Products and Services Portfolio), which is registered
as an open-end management investment company under the 1940 Act and has an
investment objective, policies and limitations substantially identical to those
of the Fund.

NOTE 2
Costs incurred by the Fund in connection with its organization, estimated at
$51,500, will be deferred and amortized on a straight-line basis for a five-year
period beginning at the commencement of the Fund's operations. G.T. Capital has
advanced certain of the Fund's organization costs incurred to date and the Fund
will reimburse G.T. Capital for the amount of these advances. In the event that
G.T. Capital redeems any of the initial 4,374.906 Class A or 4,374.906 Class B
shares of the Fund within the five-year amortization period, the Fund's
unamortized organization expenses allocable to the shares redeemed will be
deducted from G.T. Capital's redemption proceeds.

NOTE 3
G.T. Capital serves as the administrator of the Fund. The Fund pays G.T. Capital
administration fees, calculated daily and paid monthly, at an annualized rate of
0.25% of the Fund's average daily net assets. In addition, the Fund bears its
pro rata portion of the investment management and administration fees paid by
its corresponding Portfolio to G.T. Capital. The Portfolio pays such fees, based
on the average daily net assets of the Portfolio, at the annualized rate of
0.725% on the first $500 million, 0.70% on the next $500 million, 0.675% on he
next $500 million, and 0.65% on amounts in excess of $2.5 billion.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on Class A shares,
and reallows a portion of such charges to dealers through which the sales are
made. G.T. Global also makes ongoing shareholder servicing and trail commission
payments to dealers whose clients hold Class A shares.

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global, from its own resources, pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. In addition, G.T. Global makes
ongoing shareholder servicing and trail commission payments to dealers whose
clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of each class' respective shareholder
servicing and distribution expenses. Under the Class A Plan, the Fund may pay
G.T. Global a service fee at the annualized rate of up to 0.25% of the average
daily net assets of the Fund's Class A shares for G.T. Global's expenditures
incurred in servicing and maintaining shareholder accounts, and may pay G.T.
Global a distribution fee at the annualized rate of up to 0.50% of the average
daily net assets of the Fund's Class A shares, less any amounts paid by the Fund
as the aforementioned service fee, for G.T. Global's expenditures incurred in
providing services as distributor. All expenses for which G.T. Global is
reimbursed under the Class A Plan will have been incurred within one year of
such reimbursement.

                  Statement of Additional Information Page 113
<PAGE>
                 GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND

Under the Fund's Class B Plan, the Fund may pay G.T. Global a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that plan continues in effect.

                  Statement of Additional Information Page 114
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Directors of
G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global Health Care Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., including the portfolio of investments, as of October
31, 1994 and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended and the financial highlights for each of the five years in the period then
ended. These financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and the financial highlights based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1994 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Health Care Fund as of October 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the five years in the period then ended, in conformity with generally accepted
accounting principles.

                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 115
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                            PORTFOLIO OF INVESTMENTS

                                October 31, 1994

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                   Market        % of Net
Equity Investments       Country     Shares        Value        Assets(a)
<S>                    <C>          <C>        <C>             <C>
- ---------------------------------------------------------------------------
Health Care Services (37.9%)
- ---------------------------------------------
United Healthcare
 Corporation                   US     540,000     $28,485,000         6.0
Columbia/HCA
 Healthcare
 Corporation                   US     435,000      18,106,875         3.8
Pacificare Health
 Systems Inc. Class B
 (c)                           US     180,000      13,140,000         2.7
Humana, Inc.                   US     400,000       9,750,000         2.0
U.S. Healthcare, Inc.          US     200,000       9,450,000         2.0
Integrated Health
 Services, Inc.                US     200,000       8,150,000         1.7
Health Care &
 Retirement
 Corporation (c)               US     300,000       8,062,500         1.7
Health Management
 Associates, Inc.
 Class A (c)                   US     300,000       7,800,000         1.7
Value Health, Inc.
 (c)                           US     200,000       7,750,000         1.7
Pacificare Health
 Systems Inc. Class A
 (c)                           US      81,000       6,034,500         1.3
Amersham
 International PLC             UK     350,000       5,621,524         1.2
Physician Corporation
 of America (c)                US     225,000       5,428,125         1.1
Wellpoint Health
 Network, Inc. Class
 A (c)                         US     180,000       4,950,000         1.0
HBO & Company                  US     150,000       4,875,000         1.0
Pyxis Corporation (c)          US     235,000       4,523,575         0.9
Vencor, Inc. (c)               US     150,000       4,481,250         0.9
Sierra Health
 Services, Inc. (c)            US     130,000       4,225,000         0.9
Health Systems
 International, Inc.
 Class A (c)                   US     150,000       4,031,250         0.8
Coventry Corporation
 (c)                           US     151,100       3,777,500         0.8
National Medical
 Enterprises                   US     250,000       3,625,000         0.8
Grupo Casa Autrey
 S.A. de C.V.
 Sponsored ADR (b)            MEX     100,000       3,050,000         0.6

<CAPTION>
                                                   Market        % of Net
Equity Investments       Country     Shares        Value        Assets(a)
<S>                    <C>          <C>        <C>             <C>
- ---------------------------------------------------------------------------
Living Centers of
 America, Inc. (c)             US     100,000      $3,012,500         0.6
SRL Inc.                      JPN     129,000       2,877,323         0.6
Hillhaven Corporation
 (c)                           US     100,000       2,227,319         0.5
Multicare Companies,
 Inc. (c)                      US     100,000       2,062,500         0.4
Healthsource, Inc.
 (c)                           US      50,000       1,937,500         0.4
Regency Health
 Services, Inc. (c)            US     137,900       1,568,613         0.3
Inphynet Medical
 Management, Inc. (c)          US     130,000       1,527,500         0.3
Quorum Health Group,
 Inc. (c)                      US      50,000       1,137,500         0.2
                                               --------------
                                                  181,667,854
                                               --------------
Pharmaceuticals (31.7%)
- ---------------------------------------------
Pfizer, Inc.                   US     225,000      16,678,125         3.5
Bayer AG                      GER      45,000      10,533,826         2.2
Astra AB-B Free              SWDN     390,000      10,421,132         2.2
Eli Lilly & Company            US     150,000       9,300,000         2.0
Astra AB-A Free              SWDN     284,330       7,696,466         1.6
Warner-Lambert Co.             US     100,000       7,625,000         1.6
Rhone-Poulenc "A"              FR     300,000       7,402,370         1.5
Elan Corporation, PLC
 ADR (b)(c)                   IRL     200,000       7,375,000         1.5
Santen Pharmaceutical         JPN     266,000       7,059,273         1.5
Schering AG                   GER      10,000       6,681,966         1.4
Sankyo Co. Ltd.               JPN     200,000       5,204,461         1.1
Ethical Holdings PLC
 Sponsored ADR (b)(c)          UK     730,000       5,201,250         1.1
Ares-Serono Group
 Class B                     SWTZ       9,220       4,999,680         1.0
Takeda Chemical
 Industries                   JPN     400,000       4,956,629         1.0
Mylan Laboratories             US     175,000       4,900,600         1.0
American Home
 Products                      US      75,000       4,769,000         1.0
Forest Laboratories
 Inc. Class A (c)              US     100,000       4,600,000         1.0
Roche Holdings AG
 Genusscheine                SWTZ       1,000       4,453,748         0.9
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 116
<PAGE>
                           GT GLOBAL HEALTH CARE FUND
<TABLE>
<CAPTION>
                                                   Market        % of Net
Equity Investments       Country     Shares        Value        Assets(a)
- ---------------------------------------------------------------------------
<S>                    <C>          <C>        <C>             <C>
Teva Pharmaceuticals
 Ind. ADR (b)                ISRL     150,000      $4,087,500         0.9
Yamanouchi
 Pharmaceutical               JPN     200,000       3,944,651         0.8
Rhone-Poulenc S.A.
 ADR (b)                       FR     125,000       3,062,500         0.6
Allergan, Inc.                 US     100,000       2,637,500         0.6
Matrix
 Pharmaceutical, Inc.
 (c)                           US     163,000       2,344,245         0.5
Roberts
 Pharmaceutical
 Corporation (c)               US      85,000       2,295,000         0.5
Elan Corporation, PLC
 ADR Units (b)(c)             IRL      63,715       1,847,735         0.4
Roussel Uclaf                  FR       7,100         793,180         0.2
Therapeutic Discovery
 Corporation (Units)
 (c)                           US     100,000         562,500         0.1
                                               --------------
                                                  151,433,337
                                               --------------
Medical Technology & Supplies (10.8%)
- -------------------------------------------------------------
Medtronic, Inc.                US     255,000      13,293,375         2.8
Sulzer AG
 (Registered)                SWTZ      12,000       8,478,469         1.8
Nellcor, Inc. (c)              US     200,000       6,200,000         1.3
Ventritex, Inc. (c)            US     200,000       5,200,000         1.1
Target Therapeutics,
 Inc. (c)                      US     100,000       3,175,253         0.7
Sofamor Danek Group,
 Inc. (c)                      US     175,000       2,931,079         0.6
Fresenius AG
 (Preferred)                  GER       6,975       2,923,069         0.6
Haemonetics
 Corporation (c)               US     100,000       2,000,000         0.4
Cellpro, Inc. (c)              US     100,000       1,675,000         0.4
Technol Medical
 Products, Inc. (c)            US     100,000       1,600,000         0.3
Molecular Dynamics,
 Inc. (c)                      US     190,000       1,448,750         0.3
Cardiovascular
 Imaging Systems (c)           US     100,000         925,000         0.2
Orthologic
 Corporation (c)               US     165,000         639,375         0.1
Anesta Corporation
 (c)                           US     100,000         637,500         0.1
Resound Corporation
 (c)                           US      50,000         500,000         0.1
                                               --------------
                                                   51,626,870
                                               --------------
<CAPTION>
                                                   Market        % of Net
Equity Investments       Country     Shares        Value        Assets(a)
<S>                    <C>          <C>        <C>             <C>
- ---------------------------------------------------------------------------

Biotechnology (10.8%)
- ---------------------------------------------
Amgen, Inc. (c)                US     225,000     $12,543,750         2.6
Chiron Corporation
 (c)                           US     175,000      11,790,625         2.5
Genentech, Inc. (c)            US     125,000       6,343,750         1.3
Protein Design
 Laboratories, Inc.
 (c)                           US     300,000       5,175,000         1.1
Genetics Institute,
 Inc. (c)                      US      83,000       3,361,500         0.7
Genzyme Corporation
 (c)                           US     100,000       3,275,000         0.7
Cor Therapeutics,
 Inc. (c)                      US     200,000       2,600,000         0.5
Biogen, Inc. (c)               US      50,000       2,450,000         0.5
Somatix Therapy
 Corporation (c)               US     250,000       1,250,000         0.3
Alpha-Beta
 Technology, Inc. (c)          US     100,000         925,000         0.2
Gilead Sciences Inc.           US      93,000         790,500         0.2
SciClone
 Pharmaceuticals,
 Inc.                          US      90,000         551,250         0.1
Ribi Immunochem
 Research, Inc.                US     100,000         462,500         0.1
Enzon, Inc.
 (Preferred)                   US      16,000          90,000          --
                                               --------------
                                                   51,608,875
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Equity Investments (cost
 $340,425,293)...............................     436,336,936         91.2
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Warrants
- ---------------------------------------------
Pharmaceuticals (0.1%)
- ---------------------------------------------
Roche Holdings AG Wts
 expire 12/5/94 (cost
 $0)                    SWTZ            3,500         387,959          0.1
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 117
<PAGE>
                           GT GLOBAL HEALTH CARE FUND
<TABLE>
<CAPTION>
                                                   Market        % of Net
Short-Term Investment                              Value        Assets(a)
- ---------------------------------------------------------------------------
<S>                    <C>          <C>        <C>             <C>
Repurchase Agreement (7.5%)
- ---------------------------------------------
Dated October 31, 1994 with State Street Bank
 & Trust Company, due November 1, 1994, for
 an effective yield of 4.7% collateralized by
 $35,115,000 U.S. Treasury Bond, 8.125% due
 8/15/19. (Market value $36,333,171 including
 accrued interest.)
 (cost $35,732,664)..........................
                                                  $35,732,664          7.5
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Investments
 (cost $376,157,957)*........................     472,457,559         98.8
Other Assets Less Liabilities................       5,582,734          1.2
- ---------------------------------------------------------------------------
Net Assets...................................    $478,040,293        100.0
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a)  Percentages indicated are based on net assets of $478,040,293.
(b)  U.S. currency denominated.
(c)  Non-income producing security.
Abbreviation:
ADR -- American Depository Receipt
*      For Federal income tax purposes, cost is $376,883,864 and appreciation
       (depreciation) of securities is as follows:

           Unrealized appreciation:          $ 108,987,337
           Unrealized depreciation:            (13,413,642)
                                             -------------
           Net unrealized appreciation:      $  95,573,695
                                             -------------
                                             -------------
</TABLE>

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

                 FORWARD FOREIGN CURRENCY CONTRACT OUTSTANDING
                                OCTOBER 31, 1994

<TABLE>
<CAPTION>
                                                                                               Contract   Delivery    Unrealized
Contract to Sell                                                                 Market Value    Price      Date     (Depreciation)
- -------------------------------------------------------------------------------  ------------  ---------  ---------  -------------
<S>                                                                              <C>           <C>        <C>        <C>
Japanese Yen (Receivable amount $7,881,269)....................................   $8,008,104     97.7000   01/18/95   ($  126,835)
                                                                                 ------------                        -------------
                                                                                 ------------                        -------------

The value of Contract to Sell as a percentage of Net Assets is 1.7%.
<FN>
- ----------------
See Note 1 of the financial statements.
</TABLE>

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

The Fund's Portfolio of Investments at October 31, 1994, was concentrated in the
following countries:

<TABLE>
<CAPTION>
                                                 Percentage of Net Assets (a)
                              -------------------------------------------------------------------
Country                         Equity       Warrants       Short-Term        Other       Total
- ----------------------------  -----------  -------------  ---------------  -----------  ---------
<S>                           <C>          <C>            <C>              <C>          <C>
France......................          2.3                                                     2.3
Germany.....................          4.2                                                     4.2
Ireland.....................          1.9                                                     1.9
Israel......................          0.9                                                     0.9
Japan.......................          5.0                                                     5.0
Mexico......................          0.6                                                     0.6
Sweden......................          3.8                                                     3.8
Switzerland.................          3.7          0.1                                        3.8
UK..........................          2.3                                                     2.3
U.S.........................         66.5                          7.5             1.2       75.2
                                                  --              --
                                    ---                                          ---    ---------
Total.......................         91.2          0.1             7.5             1.2      100.0
                                                  --              --
                                                  --              --
                                    ---                                          ---    ---------
                                    ---                                          ---    ---------
<FN>
- ----------------
(a)  Percentages indicated are based on net assets of $478,040,293.
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 118
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<CAPTION>
Assets:
<S>                                                                                        <C>          <C>
  Investments in securities, at value (cost $376,157,957) (Note 1)....................................  $ 472,457,559
  U.S. currency..........................................................................
                                                                                           $       598
  Foreign currency (cost $9,611).........................................................
                                                                                                10,087         10,685
                                                                                           -----------
  Receivable for securities sold......................................................................     12,940,698
  Receivable for Fund shares sold.....................................................................      8,446,437
  Dividends and dividend tax reclaims receivable......................................................        506,144
  Cash held as collateral for securities loaned (Note 1)..............................................     73,360,463
                                                                                                        -------------
  Total assets........................................................................................    567,721,986
                                                                                                        -------------
Liabilities:
  Payable for securities purchased....................................................................     12,601,383
  Payable for Fund shares repurchased.................................................................      2,543,018
  Payable for investment management and administration fees (Note 2)..................................        379,381
  Payable for service and distribution expenses (Note 2)..............................................        211,960
  Payable for transfer agent fees (Note 2)............................................................        185,060
  Payable for open forward foreign currency contracts, net (Note 1)...................................        126,835
  Payable for printing and postage expenses...........................................................        102,308
  Payable for registration fees.......................................................................         55,298
  Payable for custodian fees (Note 1).................................................................         43,820
  Payable for professional fees.......................................................................         40,869
  Payable for Directors' fees (Note 2)................................................................          5,992
  Accrued expenses....................................................................................         25,306
  Collateral for securities loaned (Note 1)...........................................................     73,360,463
                                                                                                        -------------
  Total liabilities...................................................................................     89,681,693
                                                                                                        -------------
Net assets............................................................................................  $ 478,040,293
                                                                                                        -------------
                                                                                                        -------------
Class A:
Net asset value and redemption price per share
 ($438,939,891  DIVIDED BY 22,399,890 shares outstanding).............................................  $       19.60
                                                                                                        -------------
                                                                                                        -------------
Maximum offering price per share
 (100/95.25 of $19.60)*...............................................................................  $       20.58
                                                                                                        -------------
                                                                                                        -------------
Class B:+
Net asset value and offering price per share
 ($39,100,402  DIVIDED BY 2,009,174 shares outstanding)...............................................  $       19.46
                                                                                                        -------------
                                                                                                        -------------
Net assets consist of:
  Paid in capital (Note 4)............................................................................  $ 373,443,591
  Accumulated net realized gain on investments, options, foreign currency conversions and forward
   foreign currency contracts.........................................................................      8,399,184
  Net unrealized appreciation of investments, dividends and dividend withholding tax reclaims
   receivable,
   securities purchased and sold, foreign currency conversions and forward foreign currency                96,197,518
   contracts..........................................................................................
                                                                                                        -------------
  Total -- representing net assets applicable to capital shares outstanding...........................  $ 478,040,293
                                                                                                        -------------
                                                                                                        -------------
</TABLE>

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

*   On sales of $50,000 or more, the offering price is reduced.

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 119
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                            STATEMENT OF OPERATIONS

                      For the year ended October 31, 1994

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

<TABLE>
<S>                                                                                          <C>          <C>
Investment income (Note 1):
  Dividend income (net of foreign tax withheld of $198,736).............................................  $ 2,254,873
  Interest..............................................................................................    1,051,142
                                                                                                          -----------
  Total investment income...............................................................................    3,306,015
                                                                                                          -----------
Expenses:
  Investment management and administration fees (Note 2)................................................    4,353,688
  Service and distribution expenses: (Note 2)
    Class A................................................................................  $ 2,102,985
    Class B................................................................................      259,350    2,362,335
                                                                                             -----------
  Transfer agent fees (Note 2)..........................................................................    1,630,985
  Printing and postage expenses.........................................................................      227,783
  Custodian fees (Note 1)...............................................................................      193,956
  Registration fees.....................................................................................       82,195
  Professional fees.....................................................................................       76,415
  Amortization of organizational expenses (Note 1)......................................................       10,194
  Directors' fees (Note 2)..............................................................................        5,520
  Other.................................................................................................       11,135
                                                                                                          -----------
  Total net expenses....................................................................................    8,954,206
                                                                                                          -----------
Net investment loss.....................................................................................   (5,648,191)
                                                                                                          -----------
Net realized and unrealized gain on investments and foreign currencies (Note 1):
  Net realized gain on investments and options.............................................   59,524,645
  Net realized loss on foreign currency conversions and forward foreign currency
   contracts...............................................................................   (1,566,518)
                                                                                             -----------
  Net realized gain.....................................................................................   57,958,127
  Change in unrealized depreciation of dividends and dividend withholding tax reclaims
   receivable, securities purchased and sold, foreign currency conversions and forward
   foreign currency contracts..............................................................   (2,695,118)
  Change in unrealized depreciation of investments.........................................   (4,582,027)
                                                                                             -----------
  Net unrealized depreciation...........................................................................   (7,277,145)
                                                                                                          -----------
Net realized and unrealized gain on investments, options and foreign currencies.........................   50,680,982
                                                                                                          -----------
Net increase in net assets resulting from operations....................................................  $45,032,791
                                                                                                          -----------
                                                                                                          -----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 120
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                      STATEMENTS OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                    YEAR ENDED        YEAR ENDED
                                                                                                 OCTOBER 31, 1994  OCTOBER 31, 1993
                                                                                                 ----------------  ----------------
<S>                                                                                              <C>               <C>
Increase in net assets
Operations:
  Net investment loss..........................................................................   $   (5,648,191)   $   (4,772,367)
  Net realized gain (loss) on investments, options, foreign currency conversions and forward
   foreign currency contracts..................................................................       57,958,127        (2,036,715)
  Change in unrealized appreciation (depreciation) of investments, dividends and dividend
   withholding tax reclaims receivable, securities purchased and sold, foreign currency
   conversions and forward foreign currency contracts..........................................       (7,277,145)       10,173,946
                                                                                                 ----------------  ----------------
  Net increase in net assets resulting from operations.........................................       45,032,791         3,364,864
Class A:+
Distributions to shareholders from: (Note 1)
  In excess of net realized gain on investments................................................       (1,492,549)                0
Class B:++
Distributions to shareholders from: (Note 1)
  In excess of net realized gain on investments................................................          (28,033)                0
Capital share transactions (Note 4):
  Increase from capital shares sold and reinvested.............................................      785,204,559       606,277,692
  Decrease from capital shares repurchased.....................................................     (820,493,437)     (795,692,625)
                                                                                                 ----------------  ----------------
  Net decrease from capital share transactions.................................................      (35,288,878)     (189,414,933)
                                                                                                 ----------------  ----------------
Total increase (decreased) in net assets.......................................................        8,223,331      (186,050,069)
Net assets:
  Beginning of year............................................................................      469,816,962       655,867,031
                                                                                                 ----------------  ----------------
  End of year..................................................................................   $  478,040,293*   $  469,816,962**
                                                                                                 ----------------  ----------------
                                                                                                 ----------------  ----------------
</TABLE>

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

+   All capital shares issued and outstanding as of March 31, 1993, were
    reclassified as Class A shares.

++  Commencing April 1, 1993, the Fund began offering Class B shares.

*   Includes undistributed net investment income of $0.

**  Includes undistributed net investment loss of $(11,063,638).

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 121
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                              FINANCIAL HIGHLIGHTS

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

Contained  below is per share operating performance data for a share outstanding
throughout each period, total investment  return, ratios and supplemental  data.
This  information has  been derived from  information provided  in the financial
statements.
<TABLE>
<CAPTION>
                                                                      CLASS A+
                                                ----------------------------------------------------
<S>                                             <C>        <C>        <C>        <C>        <C>
                                                               YEAR ENDED OCTOBER 31,
                                                ----------------------------------------------------
                                                 1994*      1993*       1992       1991       1990
                                                --------   --------   --------   --------   --------
Per Share Operating Performance:
Net asset value, beginning of
 period.......................................  $  17.86   $  17.44   $  19.29   $  12.83   $  11.83
                                                --------   --------   --------   --------   --------
Income from investment operations:
  Net investment income (loss)................     (0.22)     (0.15)     (0.18)      0.03       0.06
  Net realized and unrealized gain (loss) on
   investments................................      2.02       0.57      (1.53)      6.78       0.97
                                                --------   --------   --------   --------   --------
  Net increase (decrease) from investment
   operations.................................      1.80       0.42      (1.71)      6.81       1.03
                                                --------   --------   --------   --------   --------
Distributions:
  Net investment income.......................     (0.00)     (0.00)     (0.00)     (0.07)     (0.03)
  Net realized gain on investments............     (0.00)     (0.00)     (0.14)     (0.28)     (0.00)
  In excess of net realized gain on
   investments................................     (0.06)     (0.00)     (0.00)     (0.00)     (0.00)
                                                --------   --------   --------   --------   --------
    Total distributions.......................     (0.06)     (0.00)     (0.14)     (0.35)     (0.03)
                                                --------   --------   --------   --------   --------
Net asset value, end of period................  $  19.60   $  17.86   $  17.44   $  19.29   $  12.83
                                                --------   --------   --------   --------   --------
                                                --------   --------   --------   --------   --------

Total investment return (c)...................     10.11%       2.4%      (8.9)%     54.2%       8.7%

Ratios and supplemental data:
Net assets, end of year (in 000's)............  $438,940   $461,113   $655,867   $552,897   $145,544
Ratio of net investment income (loss) to
 average net assets...........................     (1.23)%     (0.9)%     (1.0)%      0.2%       0.7%
Ratio of expenses to average net assets.......      1.98%       2.0%       2.1%       2.0%       2.4%
Portfolio turnover rate +++...................        64%        61%        30%        23%        34%

<CAPTION>
                                                             CLASS B++
                                                -----------------------------------
<S>                                             <C>                 <C>
                                                                    APRIL 1, 1993+
                                                   YEAR ENDED       TO OCTOBER 30,
                                                OCTOBER 31, 1994*        1993*
                                                -----------------   ---------------
Per Share Operating Performance:
Net asset value, beginning of
 period.......................................       $ 17.80            $15.59
                                                    --------           -------
Income from investment operations:
  Net investment income (loss)................         (0.32)            (0.14)
  Net realized and unrealized gain (loss) on
   investments................................          2.02              2.35
                                                    --------           -------
  Net increase (decrease) from investment
   operations.................................          1.70              2.21
                                                    --------           -------
Distributions:
  Net investment income.......................         (0.00)            (0.00)
  Net realized gain on investments............         (0.00)            (0.00)
  In excess of net realized gain on
   investments................................         (0.04)            (0.00)
                                                    --------           -------
    Total distributions.......................         (0.04)            (0.00)
                                                    --------           -------
Net asset value, end of period................       $ 19.46            $17.80
                                                    --------           -------
                                                    --------           -------
Total investment return (c)...................          9.55%             14.2%(a)
Ratios and supplemental data:
Net assets, end of year (in 000's)............       $39,100            $8,604
Ratio of net investment income (loss) to
 average net assets...........................         (1.73)%            (1.4)%(b)
Ratio of expenses to average net assets.......          2.48%              2.5%(b)
Portfolio turnover rate +++...................            64%               61%
</TABLE>

- ----------------
+   All capital shares issued and outstanding as of March 31, 1993 were
    reclassified as Class A shares.
++  Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole without
    distinguishing between the classes of shares issued.
*   These selected per share data were calculated based upon weighted average
    shares outstanding during the period.
(a) Not annualized.
(b) Annualized.
(c) Total investment return does not include sales charges.

                  Statement of Additional Information Page 122
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Health Care Fund ("Fund") is a separate series of G.T. Investment
Funds, Inc. ("Company"). The Company is organized as a Maryland corporation and
is registered under the Investment Company Act of 1940, as amended ("1940 Act"),
as a non-diversified, open-end management investment company. The Company has
eleven series of shares in operation, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.

(A)  PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares each business day, with the exception of
those days on which the New York Stock Exchange is closed.

Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or in the principal over-the-counter market in which
such securities are traded as of the close of business on the day the securities
are being valued or, lacking any sales, at the last available bid price. In
cases where securities are traded on more than one exchange, the securities are
valued on the exchange determined by G.T. Capital Management, Inc. ("G.T.
Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuation, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Directors.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Company's Board of Directors.

(B)  FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when accrued or incurred.

The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currency conversions, currency gains or losses realized between the
trade and settlement dates on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities at fiscal year end, resulting from changes in the exchange rate.

In addition, the Fund may focus its investments in certain related health care
industries, subjecting the Fund to greater risk than a fund that is more
diversified.

                  Statement of Additional Information Page 123
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

(C)  REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be paid to the
Fund under each agreement at its maturity.

(D)  FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of the contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.

(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or in the case of an over-the-counter option is valued at the
bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. At
October 31, 1994, the Fund held no written option contracts.

The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid. At October
31, 1994, the Fund held no purchased option contracts.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.

(F) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Fund may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Fund to subsequently invest at less
advantageous prices.

(G)  PORTFOLIO SECURITIES LOANED
At October 31, 1994, stocks with an aggregate value of approximately $67,530,974
were on loan to brokers. The loans were secured by cash collateral of
$73,360,463. For international securities, cash collateral is received by the
Fund against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the Fund against loaned securities in an amount at
least equal

                  Statement of Additional Information Page 124
<PAGE>
                           GT GLOBAL HEALTH CARE FUND
to 102% of the market value of the loaned securities at the inception of each
loan. This collateral must be maintained at not less than 100% of the market
value of the loaned securities during the period of the loan. For the year ended
October 31, 1994, the Fund received $106,119 of income from securities lending
which was used to offset the Fund's custody expenses.

(H)  TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains.

(I)  DISTRIBUTION TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences due to differing treatments of income and on various
investment securities held by the Fund and timing differences.

(J)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $85,951. These expenses
were amortized on a straightline basis over a five-year period and were fully
amortized at October 31, 1994.

(K)  ADOPTION OF AICPA STATEMENT OF POSITION 93-2
As of November 1, 1993, the Fund adopted Statement of Position 93-2
"Determination, Disclosure, and Financial Statement Presentation of Income,
Capital Gain, and Return of Capital Distributions by Investment Companies."
Accordingly, permanent book and tax basis differences relating to shareholder
distributions have been reclassified to paid-in capital. As of November 1, 1993,
the cumulative effect of such differences totaling $(6,290,671) and $17,082,379
was reclassified from accumulated net investment loss and accumulated net
realized loss on investments and options, respectively, to paid-in capital. Net
investment loss, net realized gain on investments and net assets were not
affected by this change. The Statement of Changes in Net Assets and the
Financial Highlights, for the prior periods, have not been restated to reflect
the changes in this presentation.

(L)  FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Fund's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(M)  INDEXED SECURITIES
The Fund may invest in indexed securities whose value is linked either directly
or indirectly to changes in foreign currencies, interest rates, equities,
indices, or other reference instruments. Indexed securities may be more volatile
than the reference instrument itself, but any loss is limited to the amount of
the original investment.

2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees to
G.T. Capital at the annualized rate of 0.975% on the first $500 million of
average daily net assets of the Fund; 0.95% on the next $500 million; 0.925% on
the next $500 million and 0.90% on amounts thereafter. These fees are computed
daily and paid monthly, and are subject to reduction in any year to the extent
that the Fund's expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary expenses) exceed the most
stringent limits prescribed by the laws or regulations of any state in which the
Fund's shares are offered for sale, based on the average total net asset value
of the Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended October 31, 1994, G.T. Global retained
$131,040 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges

                  Statement of Additional Information Page 125
<PAGE>
                           GT GLOBAL HEALTH CARE FUND
("CDSCs"), in accordance with the Fund's current prospectus. For the year ended
October 31, 1994, G.T. Global collected CDSCs in the amount of $49,801. In
addition, G.T. Global makes ongoing shareholder servicing and trail commission
payments to dealers whose clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.50% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expenses) to the maximum annual rate of 2.40% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

3. PURCHASES AND SALES OF SECURITIES
For the year ended October 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $266,952,940 and $320,104,904, respectively. There were
no purchases or sales of U.S. government obligations by the Fund for the year.

                  Statement of Additional Information Page 126
<PAGE>
                           GT GLOBAL HEALTH CARE FUND

4. CAPITAL SHARES
At October 31, 1994, there were 6,000,000,000 shares of the Company's common
stock authorized, at $0.0001 par value. Of this amount, 200,000,000 were
classified as shares of the Fund; 400,000,000 were classified as shares of G.T.
Global Government Income Fund; 200,000,000 were classified as shares of G.T.
Global Strategic Income Fund; 200,000,000 were classified as shares of G.T.
Global Growth & Income Fund; 200,000,000 were classifed as G.T. Global Currency
Fund (inactive); 200,000,000 were classified as shares of G.T. Latin America
Growth Fund, and 200,000,000 were classified as shares of G.T. Global Small
Companies Fund (inactive); 400,000,000 were classified as shares of G.T. Global
Telecommunications Fund; 200,000,000 were classified as shares of G.T. Global
Emerging Markets Fund; and 200,000,000 were classified as shares of G.T. Global
Financial Services Fund; 200,000,000 were classified as shares of G.T. Global
Natural Resources Fund; 200,000,000 were classified as shares of G.T. Global
Infrastructure Fund; and 200,000,000 were classified as shares of G.T. Global
High Income Fund; 200,000,000 were classified as shares of G.T. Global Consumer
Products and Services Fund (inactive); and 2,800,000,000 shares remain
unclassified. The shares of each of the foregoing series of the Company were
divided equally into two classes, designated Class A and Class B common stock.
Transactions in capital shares of the Fund were as follows:

                           CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
                                                                                    YEAR ENDED                  YEAR ENDED
                                                                                 OCTOBER 31, 1994            OCTOBER 31, 1993
                                                                            --------------------------  --------------------------
                                                                              SHARES        AMOUNT        SHARES        AMOUNT
                                                                            -----------  -------------  -----------  -------------
<S>                                                                         <C>          <C>            <C>          <C>
CLASS A
Shares sold...............................................................   34,050,013  $ 640,715,739   35,297,478  $ 593,025,057
Shares issued in connection with reinvestment of distributions............       59,903      1,108,216            0              0
                                                                            -----------  -------------  -----------  -------------
                                                                             34,109,916    641,823,955   35,297,478    593,025,057
Shares repurchased........................................................  (37,533,619)  (705,605,096) (47,076,381)  (790,465,124)
                                                                            -----------  -------------  -----------  -------------
Net decrease..............................................................   (3,423,703) $ (63,781,141) (11,778,903) $(197,440,067)
                                                                            -----------  -------------  -----------  -------------
                                                                            -----------  -------------  -----------  -------------

<CAPTION>

                                                                                                              APRIL 1, 1993
                                                                                    YEAR ENDED                      TO
                                                                                 OCTOBER 31, 1994            OCTOBER 31, 1993
                                                                            --------------------------  --------------------------
                                                                              SHARES        AMOUNT        SHARES        AMOUNT
                                                                            -----------  -------------  -----------  -------------
<S>                                                                         <C>          <C>            <C>          <C>
CLASS B
Shares sold...............................................................    7,582,598  $ 143,354,981      791,775  $  13,252,635
Shares issued in connection with reinvestment of distributions............        1,390         25,623            0              0
                                                                            -----------  -------------  -----------  -------------
                                                                              7,583,988    143,380,604      791,775     13,252,635
Shares repurchased........................................................   (6,058,397)  (114,888,341)    (308,192)    (5,227,501)
                                                                            -----------  -------------  -----------  -------------
Net increase..............................................................    1,525,591  $  28,492,263      483,583  $   8,025,134
                                                                            -----------  -------------  -----------  -------------
                                                                            -----------  -------------  -----------  -------------
</TABLE>

                  Statement of Additional Information Page 127
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                                   REPORT OF
                            INDEPENDENT ACCOUNTANTS

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

ANNUAL REPORT
To the Shareholders and Board of Directors of G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global Telecommunications Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., including the schedule of portfolio investments, as of
October 31, 1994 and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended and the financial highlights for each of the two years in the
period then ended and for the period from January 27, 1992 (commencement of
operations) to October 31, 1992. These financial statements and the financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and the financial
highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1994 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Telecommunications Fund as of October 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the two years in the period then ended and for the period from January 27, 1992
(commencement of operations) to October 31, 1992, in conformity with generally
accepted accounting principles.
                                                        COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
DECEMBER 16, 1994

                  Statement of Additional Information Page 128
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                            PORTFOLIO OF INVESTMENTS

                                October 31, 1994

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------
Telephone Networks (21.6%)
- -------------------------------------------
Telefonos de
 Mexico, S.A.
 de C.V.:        MEX                     --                --         3.1
  "L"            --              17,235,000       $48,109,348          --
  "L" ADR (b)    --                 435,000        23,979,375          --
  "A"            --               5,622,000        15,594,821          --
Telecomuni-
 cacoes
 Brasileiras
 S.A. -
 Telebras
 (Preferred)
 (c)             BRZL         1,781,537,000        85,909,277         3.0
Stet (Societa
 Finanziaria
 Telefonica):    ITLY                    --                --         2.2
  Ordinary       --              10,100,000        30,541,370          --
  Savings        --              12,180,000        30,138,119          --
British
 Telecommu-
 nications PLC   UK               8,702,000        56,077,655         2.0
Telefonica de
 Espana          SPN              3,850,000        52,185,125         1.8
Telecom Italia:  ITLY                    --                --         1.7
  Ordinary       --              10,930,000        24,202,015          --
  Savings        --               8,365,001        22,955,813          --
Compania de
 Telefonos de
 Chile ADR (b)   CHLE               453,100        42,648,038         1.5
Tele Danmark
 A.S.:           DEN                     --                --         1.5
  ADR (b)(c)     --                 937,100        26,941,625          --
  "B"            --                 238,133        13,726,762          --
Telecom
 Corporation of
 New Zealand
 Ltd.            NZ               9,936,000        34,641,953         1.2
Telecom
 Argentina S.A.
 "B"             ARG              3,941,034        23,983,068         0.8
Pakistan
 Telecommu-
 nications
 Company Ltd.
 Vouchers 144A
 (b)(d)(c)       PAK                141,546        23,425,863         0.8
Royal PTT
 Nederland N.V.  NETH               401,000        12,764,493         0.5

<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------
Orient Telecom
 & Technology
 Holdings Ltd.   HK              24,682,000       $11,179,885         0.4
Russian
 Telecommu-
 nications Dev.
 Corp.
 (b)(e)(c):      RUS                     --                --         0.3
  Non-Voting     --                 453,000         4,530,000          --
  Voting         --                 331,000         3,310,000          --
Atlantic Tele-
 Network, Inc.   US                 638,700         6,387,000         0.2
Telecomasia
 (Local) (c)     THAI             1,257,000         5,044,141         0.2
Companhia
 Portuguesa
 Radio Marconi,
 S.A.            PORT               135,000         4,547,313         0.2
Compania
 Peruana de
 Telefonos "B"
 (c)             PERU             2,752,765         3,831,549         0.1
Thai Tele-
 phone and
 Telecommu-
 nication
 Public Co.
 Ltd.:           THAI                    --                --         0.1
  Local (c)      --                 235,000         1,471,108          --
  144A GDR
   (b)(d)(c)     --                  75,000         1,406,250          --
                                             ----------------
                                                  609,531,966
                                             ----------------
Telecom Equipment (17.1%)
- --------------------------------------------------------------------------
Nokia AB
 (Preferred)     FIN                800,540       120,688,785         4.3
Motorola, Inc.   US               1,659,500        97,703,063         3.5
Alcatel Alsthom  FR                 491,352        45,058,897         1.6
Kyushu-
 Matsushita
 Electric
 Industrial      JPN              1,531,000        38,575,381         1.4
Glenayre
 Technologies,
 Inc. (c)        US                 563,500        35,077,875         1.2
ECI Telecommu-
 nications Ltd.
 (b)             ISRL             1,338,800        25,939,250         0.9
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 129
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
- --------------------------------------------------------------------------
<S>              <C>        <C>              <C>               <C>
U.S. Robotics,
 Inc. (c)        US                 636,000       $25,599,000         0.9
Telefonaktie-
 bolaget LM
 Ericsson "B"
 Free            SWDN               388,000        23,624,293         0.8
Champion
 Technology
 Holdings        HK              62,809,163        20,321,277         0.7
Boston
 Technology,
 Inc. (c)        US                 914,200        15,084,300         0.5
International
 Engineering
 Public Com-
 pany Ltd.
 (Foreign)       THAI             1,146,300        11,499,799         0.4
Tadiran Ltd.
 (b)             ISRL               415,200         8,771,100         0.3
Mitel Corpo-
 ration (c)      US               2,500,000         8,750,000         0.3
Netas
 Telekomunik:    TRKY                    --                --         0.2
  New (c)        --               9,900,000         3,518,955          --
  Common         --               7,920,000         2,815,164          --
Prod-Art
 Technology
 Holdings Ltd.   HK              41,604,300         3,122,860         0.1
                                             ----------------
                                                  486,149,999
                                             ----------------
Wireless Communications (10.1%)
- -------------------------------------------
DDI Corporation  JPN                  8,414        76,285,543         2.7
Advanced
 Information
 Service
 (Foreign)       THAI             2,986,050        52,723,192         1.9
Airtouch
 Communica-
 tions (c)       US               1,000,000        29,875,000         1.1
United
 Communication
 Industry:       THAI                    --                --         1.1
  Foreign        --                 917,900        26,962,391          --
  Local          --                  66,000         1,949,278          --
Millicom
 International
 Cellular S.A.
 (c)             US                 955,500        26,873,431         1.0
Vodafone Group
 PLC             UK               5,795,000        20,070,183         0.7
Telephone and
 Data Systems,
 Inc.            US                 315,600        15,622,200         0.6
Tele 2000 (c)    PERU             5,472,293        15,159,729         0.5
Rogers Cantel
 Mobile
 Communica-
 tions Class B
 (c)             CAN                382,000        11,674,875         0.4
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------
ABC Com-
 munications
 Holdings Ltd.   HK               6,498,000        $2,817,169         0.1
                                             ----------------
                                                  280,012,991
                                             ----------------
Telephone -- Regional/Local (7.8%)
- -------------------------------------------
Pacific Telesis
 Group           US               2,000,000        63,250,000         2.2
MFS Com-
 munications
 Company, Inc.
 (c)             US               1,422,900        52,647,300         1.9
Bell Atlantic
 Corporation     US                 750,000        39,281,250         1.4
U.S. West, Inc.  US               1,000,000        37,625,000         1.3
Alltel
 Corporation     US                 670,000        17,336,250         0.6
Intermedia
 Communica-
 tions of
 Florida, Inc.
 (c)             US                 873,900         9,503,663         0.3
IntelCom Group,
 Inc.            US                 215,000         3,278,750         0.1
                                             ----------------
                                                  222,922,213
                                             ----------------
Technology (7.1%)
- -------------------------------------------
Cisco Systems,
 Inc.            US               2,016,600        60,750,075         2.1
  NETWORKING
Kyocera
 Corporation     JPN                584,000        44,505,576         1.6
  SEMICONDUCTORS
Qualcomm, Inc.
 (c)             US                 893,500        26,358,250         0.9
  TELECOM TECHNOLOGY
NEC Corporation  JPN              2,000,000        25,609,252         0.9
  SEMICONDUCTORS
Fujitsu Ltd.     JPN              2,000,000        22,924,410         0.8
  COMPUTERS & PERIPHERALS
Shinawatra
 Computer
 Company, Ltd.:  THAI                    --                --         0.6
  COMPUTERS & PERIPHERALS
  Foreign        --                 493,800        14,267,094          --
  Local          --                  81,900         2,550,337          --
AT&T Global
 Info Solution
 JP              JPN                469,000         6,247,521         0.2
  COMPUTERS & PERIPHERALS
I.I.S.
 Intelligent
 Information
 Systems Ltd.    ISRL               264,500           859,625          --
  NETWORKING
                                             ----------------
                                                  204,072,140
                                             ----------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 130
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
- --------------------------------------------------------------------------
<S>              <C>        <C>              <C>               <C>
Broadcasting & Publishing (7.0%)
- -------------------------------------------
Time Warner,
 Inc.            US               1,250,000       $44,375,000         1.6
Reuters
 Holdings PLC    UK               5,100,000        40,039,253         1.4
News Corpo-
 ration Ltd.:    AUSL                    --                --         1.0
  Common         --               3,814,562        23,523,935          --
  ADR (b)        --                 120,800         5,904,100          --
Elsevier N.V.    NETH             1,525,000        15,548,310         0.5
Evergreen Media
 Corporation
 Class A (c)     US                 771,100        13,687,025         0.5
Canal Plus       FR                  82,676        13,637,444         0.5
Granada Group
 PLC             UK               1,500,000        12,733,071         0.5
International
 Broadcasting
 Corp. Ltd.:     THAI                    --                --         0.5
  Foreign        --               1,373,700        10,308,261          --
  Local          --                 217,600         1,632,873          --
Sistem
 Televisyen
 Malaysia Bhd.   MAL              3,718,000         8,732,824         0.3
Television
 Broadcasts
 Ltd.            HK               1,067,000         4,929,714         0.2
Medya Holdings
 AS              TRKY            18,966,080           951,737          --
                                             ----------------
                                                  196,003,547
                                             ----------------
Telephone -- Long Distance (6.7%)
- -------------------------------------------
LDDS Communica-
 tions, Inc.
 (c)             US               2,057,620        48,354,070         1.7
AT&T
 Corporation     US                 635,500        34,952,500         1.2
IDB Communica-
 tions Group,
 Inc. (c)        US               3,615,000        33,438,750         1.2
Philippine Long
 Distance
 Telephone
 Company:        PHIL                    --                --         1.2
  ADR (b)        --                 478,495        27,274,215          --
  Common         --                  94,844         5,507,071          --
GN Store Nord
 AS              DEN                134,166        13,003,676         0.5
Call-Net
 Enterprises,
 Inc. (c):       CAN                     --                --         0.3
  "B"            --               1,207,800         6,923,409          --
  "A"            --                 469,400         2,951,109          --
KDD              JPN                 84,100         8,641,006         0.3
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------

WCT Communica-
 tions, Inc.
 (c)             US                 573,000        $3,366,375         0.1
Petersburg Long
 Distance, Inc.
 (b)(c)(e)       CAN                310,000         2,596,250         0.1
Cam-Net
 Communica-
 tions Network,
 Inc. (c)        CAN                547,975         2,203,856         0.1
                                             ----------------
                                                  189,212,287
                                             ----------------
Capital Goods (6.5%)
- -------------------------------------------
Mannesmann AG    GER                151,500        40,512,872         1.4
  MACHINERY & ENGINEERING
Orbital
 Sciences
 Corporation
 (c)             US               1,417,500        30,830,625         1.1
  AEROSPACE/DEFENSE
Canon Inc.       JPN              1,600,000        29,739,776         1.0
  OFFICE EQUIPMENT
Murata
 Manufacturing
 Co., Ltd.       JPN                542,300        22,175,836         0.8
  ELECTRICAL PLANT/EQUIPMENT
Alcatel Cable    FR                 133,813        15,598,951         0.6
  INDUSTRIAL COMPONENTS
Olivetti Group   ITLY            12,500,000        14,956,913         0.5
  OFFICE EQUIPMENT
Leader
 Universal
 Holdings Bhd.   MAL              1,649,000         9,166,489         0.3
  INDUSTRIAL COMPONENTS
BICC PLC         UK               1,500,000         8,292,446         0.3
  ELECTRICAL PLANT/EQUIPMENT
PT Kabelmetal
 Indonesia
 (Local)         INDO             5,100,000         7,337,707         0.3
  INDUSTRIAL COMPONENTS
PT Kabelindo
 Murni (Local)   INDO             1,079,000         2,980,662         0.1
  INDUSTRIAL COMPONENTS
PT Voksel
 Electronics
 (Foreign)       INDO             1,106,700         1,936,215         0.1
  INDUSTRIAL COMPONENTS
                                             ----------------
                                                  183,528,492
                                             ----------------
Cable Television (3.7%)
- -------------------------------------------
Comcast
 Corporation
 Class A         US               2,840,000        46,505,000         1.6
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 131
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
- --------------------------------------------------------------------------
<S>              <C>        <C>              <C>               <C>
Tele-Communica-
 tions, Inc.
 Class A (c)     US               1,692,500       $38,292,813         1.4
Rogers
 Communica-
 tions, Inc.
 Class B (c)     CAN              1,001,400        14,721,024         0.5
International
 CableTel, Inc.
 (c)             US                 145,400         4,507,400         0.2
                                             ----------------
                                                  104,026,237
                                             ----------------
Consumer Durables (2.8%)
- -------------------------------------------
Sony Corp.       JPN                750,000        45,771,375         1.5
  CONSUMER ELECTRONICS
Amcol Hold-
 ings Ltd.       SING            10,644,000        24,652,313         0.9
  CONSUMER ELECTRONICS
Edaran Otomobil
 Nasional Bhd.   MAL              1,426,000        10,159,795         0.4
  AUTOMOBILES
                                             ----------------
                                                   80,583,483
                                             ----------------
Multi-Industry (2.4%)
- -------------------------------------------
Grupo Carso,
 S.A. de C.V.
 "A1" (c)        MEX              4,341,000        46,230,634         1.6
Pearson PLC      UK               2,300,000        23,850,179         0.8
                                             ----------------
                                                   70,080,813
                                             ----------------
Services (1.1%)
- -------------------------------------------
Compagnie
 Generale des
 Eaux            FR                 140,118        12,835,756         0.5
  CONSUMER SERVICES
Sapura
 Telecommu-
 nications Bhd.  MAL              2,365,000        10,832,059         0.4
  VALUE ADDED TELEPHONE SERVICE
Radiotronica
 S.A.            SPN                257,500         3,500,600         0.1
  TELECOM - OTHER
Grupo Mexicano
 de Video ADR
 (b)(e)          MEX                122,000         2,165,500         0.1
  LEISURE & TOURISM
Gran Cadena de
 Almacenes
 Colombianos     COL                 64,000           122,312          --
  RETAILERS-OTHER
                                             ----------------
                                                   29,456,227
                                             ----------------
<CAPTION>
Equity                                            Market        % of Net
Investments       Country       Shares            Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------

Investment Management (0.1)
- -------------------------------------------
Phatra Thanakit
 Co. Ltd.
 (Foreign)       THAI               223,900        $2,300,096         0.1
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Equity Investments
 (cost $2,345,081,166).....................     2,657,880,491        94.0
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Warrants (0.0%)
- -------------------------------------------
Stet Wts expire
 9/30/96         ITLY                69,000         1,186,831          --
  TELEPHONE NETWORKS
American
 Satellite
 Network Wts
 expire 1/1/99
 (c)(e)          US                  65,825                 0          --
  WIRELESS COMMUNICATIONS
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Warrants (cost $439,365).............         1,186,831          --
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Rights (0.3%)
- -------------------------------------------
Phatra Thanakit
 Co. Ltd.
 (Foreign)
 Rights expire
 11/3/94 (c)
 (cost
 $3,766,184)     THAI               895,600         8,840,995         0.3
  INVESTMENT MANAGEMENT
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
<CAPTION>
Option on
Currency (0.2%)  Currency
<S>              <C>        <C>              <C>               <C>
- --------------------------
USD Call/ JPY
 Put Option,
 Strike 100,
 expires
 10/9/95 (cost
 $8,430,000)     USD            300,000,000         4,980,000         0.2
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Structured Note (0.4%)
- -------------------------------------------
Credit Suisse
 Synthetic
 Equity MTN,
 3.25% due
 4/29/97 (cost
 $7,000,000)
 (This is an
 equity linked
 note. The
 value of this
 note is linked
 to the
 underlying
 value of
 Rostelecom.)    USD              7,000,000        11,550,000         0.4
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 132
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
Short-Term                     Principal          Market        % of Net
Investments      Currency       Amount            Value         Assets(a)
- --------------------------------------------------------------------------
<S>              <C>        <C>              <C>               <C>
Treasury Bills (1.8%)
- -------------------------------------------
Mexican Cetes
 due:
  11/3/94
   (effective
   yield 11.4%)  MXN             79,051,410       $23,012,145         0.8
  11/24/94
   (effective
   yield 15.8%)  MXN             67,820,650        19,556,432         0.7
  11/17/94
   (effective
   yield 16.0%)  MXN             25,413,200         7,349,601         0.3
- --------------------------------------------------------------------------
Total Treasury Bills (cost $50,416,852)....
                                                   49,918,178         1.8
- --------------------------------------------------------------------------
<CAPTION>

                                                  Market        % of Net
Repurchase Agreement (1.1%)                       Value         Assets(a)
<S>              <C>        <C>              <C>               <C>
- --------------------------------------------------------------------------
Dated October 31, 1994 with State Street
 Bank & Trust Company, due November 1,
 1994, for an effective yield of 4.7%
 collateralized by $31,095,000 Federal Home
 Loan Mortgage Corporation Discount Note,
 0% due 1/27/95. (Market value $30,690,822
 including accrued interest) (cost
 $30,690,006)..............................
                                                  $30,690,006         1.1
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Short-Term Investments
 (cost $81,106,858)........................        80,608,184         2.9
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Total Investments
 (cost $2,445,823,573)*....................     2,765,046,501        97.8
Other Assets Less Liabilities..............        63,436,420         2.2
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Net Assets.................................    $2,828,482,921       100.0
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a)  Percentages indicated are based on net assets of $2,828,482,921.
(b)  U.S. currency denominated.
(c)  Non-income producing security.
(d)  Security exempt from registration under Rule 144A of the Securities Act of
     1933. These securities may be resold in transactions exempt from
     registration, normally to qualified institutional buyers.
(e)  Restricted securities -- At October 31, 1994, the Fund owned the following
     restricted securities constituting 0.5% of net assets which may not be
     publicly sold without registration under the Securities Act of 1933. (Note
     1)
     Additional information on restricted securities is as follows:
                                                               Acquisition              Acquisition
Description                                                       Dates        Shares      Cost      Market Value
                                                            -----------------  -------  -----------  ------------
Russian Telecommunications Development Corporation:
  Non Voting..............................................      12/22/93       453,000  $ 4,530,000  $  4,530,000
  Voting..................................................      12/22/93       331,000    3,310,000     3,310,000
Grupo Mexicano de Video ADR...............................      07/01/92       122,000    2,013,000     2,165,000
Petersburg Long Distance, Inc.............................  02/11/93-10/5/93   310,000    2,236,250     2,596,250
American Satellite Network Wts expire 1/1/99..............      12/31/93        65,825           --            --
                                                                                        -----------  ------------
    Total.................................................                              $12,089,250  $ 12,601,250
                                                                                        -----------  ------------
                                                                                        -----------  ------------

Abbreviations:
ADR -- American Depository Receipt
GDR -- Global Depository Receipt
MTN -- Medium Term Note
*      For Federal income tax purposes, cost is $2,446,743,346 and appreciation
       (depreciation) of securities is as follows:

           Unrealized appreciation:     $ 475,856,937
           Unrealized depreciation:      (157,553,782)
                                        -------------
           Net unrealized
           appreciation:                $ 318,303,155
                                        -------------
                                        -------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 133
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                 FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
                                OCTOBER 31, 1994

<TABLE>
<CAPTION>
                                                                                                 Contract   Delivery    Unrealized
Total Contracts to Sell:                                                          Market Value     Price      Date     Appreciation
                                                                                 --------------  ---------  ---------  ------------
<S>                                                                              <C>             <C>        <C>        <C>
Deutschemark...................................................................  $   99,175,934     1.4893   01/25/95   $  824,066
Deutschemark...................................................................      69,353,233     1.4878   01/25/95      646,767
Deutschemark...................................................................      69,377,705     1.4884   01/25/95      622,295
Deutschemark...................................................................      99,112,339     1.4884   01/25/95      887,661
Deutschemark...................................................................      49,670,352     1.4917   01/31/95      329,648
Deutschemark...................................................................      39,715,637     1.4909   01/31/95      284,363
Deutschemark...................................................................      49,633,058     1.4906   01/31/95      366,942
Deutschemark...................................................................      99,270,112     1.4906   01/31/95      729,888
Deutschemark...................................................................      99,272,775     1.4907   01/31/95      727,225
                                                                                 --------------                        ------------
    Total Contracts to Sell (Receivable amount $680,000,000)...................  $  674,581,145                         $5,418,855
                                                                                 --------------                        ------------
                                                                                 --------------                        ------------
<FN>
- ----------------
See Note 1 of the financial statements.
</TABLE>

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

                      WRITTEN OPTION CONTRACT OUTSTANDING
                                OCTOBER 31, 1994
<TABLE>
<CAPTION>
                                                                                   Expiration
                                                                         Strike       Date         Shares       Currency
                                                                        ---------  -----------  -------------  -----------
<S>                                                                     <C>        <C>          <C>            <C>
JPY Call/USD Put (cost $8,430,000)....................................      92.92    10/09/95     300,000,000         USD

<CAPTION>

                                                                        Market Value
                                                                        -------------
<S>                                                                     <C>
JPY Call/USD Put (cost $8,430,000)....................................  $  10,680,000
                                                                        -------------
                                                                        -------------
<FN>
- ----------------
See Notes 1 and 5 of the financial statements.
</TABLE>

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

The Fund's Portfolio of Investments at October 31, 1994, was concentrated in the
following countries:

<TABLE>
<CAPTION>
                                                      Percentage of Net Assets (a)
                          ------------------------------------------------------------------------------------
                                         Rights &
                            Equity       Warrants     Structured Note    Short-Term        Other       Total
                          -----------  -------------  ---------------  ---------------  -----------  ---------
<S>                       <C>          <C>            <C>              <C>              <C>          <C>
Argentina...............          0.8                                                                      0.8
Australia...............          1.0                                                                      1.0
Brazil..................          3.0                                                                      3.0
Canada..................          1.4                                                                      1.4
Chile...................          1.5                                                                      1.5
Denmark.................          2.0                                                                      2.0
Finland.................          4.3                                                                      4.3
France..................          3.2                                                                      3.2
Germany.................          1.4                                                                      1.4
Hong Kong...............          1.5                                                                      1.5
Indonesia...............          0.5                                                                      0.5
Israel..................          1.2                                                                      1.2
Italy...................          4.4                                                                      4.4
Japan...................         11.2                                                                     11.2
Malaysia................          1.4                                                                      1.4
Mexico..................          4.8                                                                      4.8
Netherlands.............          1.0                                                                      1.0
New Zealand.............          1.2                                                                      1.2
Pakistan................          0.8                                                                      0.8
Peru....................          0.6                                                                      0.6
Philippines.............          1.2                                                                      1.2
Portgual................          0.2                                                                      0.2
Russia..................          0.3                                                                      0.3
Singapore...............          0.9                                                                      0.9
Spain...................          1.9                                                                      1.9
Sweden..................          0.8                                                                      0.8
Thailand................          4.9          0.3                                                         5.2
Turkey..................          0.2                                                                      0.2
UK......................          5.7                                                                      5.7
U.S.....................         30.7                           0.4             2.9             2.4       36.4
                                              --               --              --              --
                                ---                                                                  ---------
Total...................         94.0          0.3              0.4             2.9             2.4      100.0
                                              --               --              --              --
                                              --               --              --              --
                                ---                                                                  ---------
                                ---                                                                  ---------
<FN>
- ----------------
(a)  Percentages indicated are based on net assets of $2,828,482,921.
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 134
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                              STATEMENT OF ASSETS
                                AND LIABILITIES

                                October 31, 1994

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

<TABLE>
<S>                                                                                       <C>          <C>
Assets:
  Investments in securities, at value (cost $2,445,823,573) (Note 1).................................  $2,765,046,501
  U.S. currency.........................................................................
                                                                                          $        51
  Foreign currency (cost $20,379,987)...................................................
                                                                                           20,663,779      20,663,830
                                                                                          -----------
  Receivable for securities sold.....................................................................      48,191,408
  Receivable for Fund shares sold....................................................................      16,089,479
  Receivable for forward foreign currency contracts -- open (Note 1).................................       5,418,855
  Dividends and dividend withholding tax reclaims receivable.........................................       4,657,844
  Interest receivable................................................................................       1,224,874
  Unamortized deferred organizational expenses (Note 1)..............................................          29,824
  Cash held as collateral for securities loaned (Note 1).............................................     254,665,344
                                                                                                       --------------
  Total assets.......................................................................................   3,115,987,959
                                                                                                       --------------
Liabilities:
  Payable for Fund shares repurchased................................................................      12,184,690
  Premium on options (cost $8,430,000)...............................................................      10,680,000
  Payable for securities purchased...................................................................       5,055,414
  Payable for investment management and administration fees (Note 2).................................       2,129,685
  Payable for service and distribution expenses (Note 2).............................................       1,648,382
  Payable for transfer agent fees (Note 2)...........................................................         495,238
  Payable for registration fees......................................................................         349,413
  Payable for custodian fees (Note 1)................................................................         203,991
  Payable for professional fees......................................................................          88,191
  Payable for Directors' fees (Note 2)...............................................................           2,850
  Accrued expenses...................................................................................           1,840
  Collateral for securities loaned (Note 1)..........................................................     254,665,344
                                                                                                       --------------
  Total liabilities..................................................................................     287,505,038
                                                                                                       --------------
Net assets...........................................................................................  $2,828,482,921
                                                                                                       --------------
                                                                                                       --------------
Class A:
Net asset value and redemption price per share
 ($1,644,401,968  DIVIDED BY 92,389,577 shares outstanding)..........................................  $        17.80
                                                                                                       --------------
                                                                                                       --------------
Maximum offering price per share
 (100/95.25 of $17.80)*..............................................................................  $        18.69
                                                                                                       --------------
                                                                                                       --------------
Class B:+
Net asset value and offering price per share
 ($1,184,080,953  DIVIDED BY 67,062,045 shares outstanding)..........................................  $        17.66
                                                                                                       --------------
                                                                                                       --------------
Net assets consist of:
  Paid in capital (Note 4)...........................................................................  $2,369,842,398
  Accumulated net realized gain on investments, foreign currency conversions, forward foreign
   currency contracts and options....................................................................     135,486,335
  Net unrealized appreciation of investments, written options, dividends and dividend withholding tax
   reclaims receivable, interest receivable, securities purchased and sold, foreign currency
   conversions and forward foreign currency contracts................................................     323,154,188
                                                                                                       --------------
  Total -- representing net assets applicable to capital shares outstanding..........................  $2,828,482,921
                                                                                                       --------------
                                                                                                       --------------
</TABLE>

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

*   On sales of $50,000 or more, the offering price is reduced.

+   Redemption price per share is equal to the net asset value per share less
    any applicable contingent deferred sales charge.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 135
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                            STATEMENT OF OPERATIONS

                      For the year ended October 31, 1994

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

<TABLE>
<S>                                                                                       <C>            <C>
Investment income (Note 1):
  Dividend income (net of foreign withholding tax of $3,156,142).......................................  $  27,209,488
  Interest income (net of foreign withholding tax of $29)..............................................     14,716,746
                                                                                                         -------------
  Total investment income..............................................................................     41,926,234
                                                                                                         -------------
Expenses:
  Investment management and administration fees (Note 2)...............................................     21,926,187
  Service and distribution expenses: (Note 2)
    Class A.............................................................................  $   7,330,230
    Class B.............................................................................      8,894,192     16,224,422
                                                                                          -------------
  Transfer agent fees (Note 2).........................................................................      5,870,772
  Custodian fees (Note 1)..............................................................................      1,598,727
  Registration fees....................................................................................        830,617
  Professional fees....................................................................................        219,319
  Printing and postage expenses........................................................................        188,403
  Amortization of organizational expenses (Note 1).....................................................         17,701
  Directors' fees (Note 2).............................................................................          7,494
  Other................................................................................................         50,872
                                                                                                         -------------
  Total expenses.......................................................................................     46,934,514
                                                                                                         -------------
Net investment loss....................................................................................     (5,008,280)
                                                                                                         -------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
  Net realized gain on investments and written options..................................    171,447,523
  Net realized loss on foreign currency conversions and forward foreign currency
   contracts............................................................................    (33,457,459)
                                                                                          -------------
  Net realized gain....................................................................................    137,990,064
                                                                                                         -------------
  Change in unrealized appreciation of dividends and dividend withholding tax reclaims
   receivable, interest receivable, securities purchased and sold, foreign currency
   conversions and forward foreign currency contracts...................................      3,578,825
  Change in unrealized appreciation of investments......................................     27,259,645
                                                                                          -------------
  Net unrealized appreciation..........................................................................     30,838,470
                                                                                                         -------------
Net realized and unrealized gain on investments, options and foreign currencies........................    168,828,534
                                                                                                         -------------
Net increase in net assets resulting from operations...................................................  $ 163,820,254
                                                                                                         -------------
                                                                                                         -------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 136
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                      STATEMENTS OF CHANGES IN NET ASSETS

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

<TABLE>
<CAPTION>
                                                                                                  YEAR ENDED        YEAR ENDED
                                                                                               OCTOBER 31, 1994  OCTOBER 31, 1993
                                                                                               ----------------  ----------------
<S>                                                                                            <C>               <C>
Increase in net assets
Operations:
  Net investment income (loss)...............................................................
                                                                                                $   (5,008,280)   $    4,947,873
  Net realized gain on investments, written options, foreign currency conversions and forward
   foreign currency contracts................................................................
                                                                                                   137,990,064        35,389,185
  Change in unrealized appreciation of investments, written options, dividends and dividend
   withholding tax reclaims receivable, interest receivable, securities purchased and sold,
   foreign currency conversions and forward foreign currency contracts.......................
                                                                                                    30,838,470       300,873,503
                                                                                               ----------------  ----------------
  Net increase in net asssets resulting from operations......................................
                                                                                                   163,820,254       341,210,561
Class A:+
Distributions to shareholders from: (Note 1)
  Net investment income......................................................................
                                                                                                    (1,139,864)       (6,107,928)
  Net realized gain from investments.........................................................
                                                                                                   (20,482,527)                0
Class B:++
Distributions to shareholders from: (Note 1)
  Net investment income......................................................................
                                                                                                      (511,428)                0
  Net realized gain from investments.........................................................
                                                                                                    (9,209,255)                0
Capital share transactions: (Note 4)
  Increase from capital shares sold and reinvested...........................................
                                                                                                 1,678,630,071     1,077,285,253
  Decrease from capital shares repurchased...................................................
                                                                                                  (661,298,601)     (176,576,036)
                                                                                               ----------------  ----------------
  Net increase from capital share transactions...............................................
                                                                                                 1,017,331,470       900,709,217
                                                                                               ----------------  ----------------
Total increase in net assets.................................................................
                                                                                                 1,149,808,650     1,235,811,850
Net assets:
  Beginning of year..........................................................................
                                                                                                 1,678,674,271       442,862,421
                                                                                               ----------------  ----------------
  End of year................................................................................
                                                                                                $2,828,482,921*   $1,678,674,271**
                                                                                               ----------------
                                                                                               ----------------  ----------------
                                                                                                                 ----------------
</TABLE>

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

*   Including undistributed net investment income of $0.

**  Including undistributed net investment income of $4,224,140.

+   All capital shares issued and outstanding March 31, 1993 were reclassified
    as Class A shares.

++  Commencing April 1, 1993, the Fund began offering Class B shares.

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 137
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                              FINANCIAL HIGHLIGHTS

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

Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
                                                                                CLASS A+
                                                              --------------------------------------------
                                                                                          JANUARY 27, 1992
                                                                                           (COMMENCEMENT
                                                               YEAR ENDED OCTOBER 31,      OF OPERATIONS)
                                                              -------------------------          TO
                                                                1994(C)        1993       OCTOBER 31, 1992
                                                              -----------   -----------   ----------------
<S>                                                           <C>           <C>           <C>
Per Share Operating Performance:
Net asset value, beginning of year..........................  $     16.92   $     11.16       $  11.43
                                                              -----------   -----------   ----------------
Income from investment operations:
  Net investment income.....................................        (0.01)         0.08           0.14*
  Net realized and unrealized gain (loss) on
   investments..............................................         1.17          5.83          (0.41)
                                                              -----------   -----------   ----------------
  Net increase (decrease) from investment operations........         1.16          5.91          (0.27)
                                                              -----------   -----------   ----------------
Distributions:
  Net investment income.....................................        (0.01)        (0.15)         (0.00)
  Net realized gain on investments..........................        (0.27)        (0.00)         (0.00)
                                                              -----------   -----------   ----------------
  Total distributions.......................................        (0.28)        (0.15)         (0.00)
                                                              -----------   -----------   ----------------
Net asset value, end of year................................  $     17.80   $     16.92       $  11.16
                                                              -----------   -----------   ----------------
                                                              -----------   -----------   ----------------
Total investment return(d)..................................         7.02%         53.6%           2.4%(a)
Ratios and supplemental data:
Net assets, end of year (in 000's)..........................  $ 1,644,402   $ 1,223,340       $442,862
Ratio of net investment income to average net assets........        (0.02)%         0.8%           2.1%*(b)
Ratio of expenses to average net asset......................         1.80%          2.0%           2.3%*(b)
Portfolio turnover rate+++..................................           57%           41%             4%(b)

<CAPTION>

                                                                        CLASS B++
                                                              ------------------------------
                                                              YEAR ENDED
                                                              OCTOBER 31,   APRIL 1, 1993 TO
                                                                1994(C)     OCTOBER 31, 1993
                                                              -----------   ----------------
<S>                                                           <C>           <C>
Per Share Operating Performance:
Net asset value, beginning of year..........................  $     16.87       $  12.68
                                                              -----------   ----------------
Income from investment operations:
  Net investment income.....................................        (0.10)          0.01
  Net realized and unrealized gain (loss) on
   investments..............................................         1.17           4.18
                                                              -----------   ----------------
  Net increase (decrease) from investment operations........         1.07           4.19
                                                              -----------   ----------------
Distributions:
  Net investment income.....................................        (0.01)         (0.00)
  Net realized gain on investments..........................        (0.27)         (0.00)
                                                              -----------   ----------------
  Total distributions.......................................        (0.28)         (0.00)
                                                              -----------   ----------------
Net asset value, end of year................................  $     17.66       $  16.87
                                                              -----------   ----------------
                                                              -----------   ----------------
Total investment return(d)..................................         6.50%          33.0%(a)
Ratios and supplemental data:
Net assets, end of year (in 000's)..........................  $ 1,184,081       $455,335
Ratio of net investment income to average net assets........        (0.52)%          0.3%(b)
Ratio of expenses to average net asset......................         2.30%           2.5%(b)
Portfolio turnover rate+++..................................           57%            41%
</TABLE>

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

  + All capital shares issued and outstanding March 31, 1993 were reclassified
    as Class A shares.

 ++ Commencing April 1, 1993, the Fund began offering Class B shares.

+++ Portfolio turnover is calculated on the basis of the Fund as a whole without
    distinguishing between the classes of shares issued.

  * Includes reimbursement by G.T. Capital Management, Inc. of Fund operating
    expenses of less than $0.01. Without such reimbursement, the annualized
    expense ratio would have been 2.30% and the annualized ratio of net
    investment income average net assets would have been 2.04% (See Note 2).

 (a) Not annualized.

 (b) Annualized.

 (c) These selected per share data were calculated based upon weighted average
     shares outstanding during the period.

 (d) Total investment return does not include sales charges.

                  Statement of Additional Information Page 138
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

                                    NOTES TO
                              FINANCIAL STATEMENTS

                                October 31, 1994

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

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Telecommunications Fund ("Fund") is a separate series of G.T.
Investment Funds, Inc. ("Company"). The Company is organized as a Maryland
corporation and is registered under the Investment Company Act of 1940, as
amended ("1940 Act"), as a diversified, open-end management investment company.
The Company has eleven series of shares in operation, each series corresponding
to a distinct portfolio of investments. The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of the financial statements. The policies are in conformity with
generally accepted accounting principles.

(A)  PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.

Equity securities are valued at the last quoted sales price on the exchange on
which such securities are traded, or, in the principal over-the-counter market
in which such securities are traded as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuation, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Directors.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Company's Board of Directors.

(B)  FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when accrued or incurred.

The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currency conversions, currency gains or losses realized between the
trade and settlement dates on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains or losses arise from
changes in the value of assets and liabilities other than investments in
securities at fiscal year end, resulting from changes in the exchange rate.

In addition, the Fund may focus its investments in certain related
telecommunication industries, subjecting the Fund to greater risk than a fund
that is more diversified.

(C)  REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value,

                  Statement of Additional Information Page 139
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

including accrued interest, is at least equal to the amount to be repaid to the
Fund under each agreement at its maturity.

(D)  FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of the contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.

(E)  OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or in the case of an over-the-counter option is valued at the
bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding.

The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.

(F) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Fund may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Fund to subsequently invest at less
advantageous prices.

(G)  PORTFOLIO SECURITIES LOANED
At October 31, 1994, stocks with an aggregate value of approximately
$220,840,237, were on loan to brokers. The loans were secured by cash collateral
of $254,665,344. For international securities, cash collateral is received by
the Fund against loaned securities in an amount at least equal to 105% of the
market value of the loaned securities at the inception of each loan. This
collateral must be maintained at not less than 103% of the market value of the
loaned securities during the period of the loan. For domestic securities, cash
collateral is received by the Fund against loaned securities in an amount at
least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. For
the year ended October 31, 1994, the Fund received $910,464 of income from
securities lending which was used to offset the Fund's custody expenses.

                  Statement of Additional Information Page 140
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

(H)  TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains.

(I)  DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.

(J)  DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $78,843. These expenses
are being amortized on a straightline basis over a five-year period.

(K)  ADOPTION OF AICPA STATEMENT OF POSITION 93-2
As of November 1, 1993, the Fund adopted Statement of Position 93-2
"Determination, Disclosure, and Financial Statement Presentation of Income,
Capital Gain, and Return of Capital Distributions by Investment Companies."
Accordingly, permanent book and tax basis differences relating to shareholder
distributions have been reclassified. As of November 1, 1993, the cumulative
effect of such differences totaling $882,609 was reclassified from undistributed
net investment income to accumulated net realized gains on investments and
options. Net investment loss, net realized gain on investments, foreign currency
conversions and forward foreign currency contracts and net assets were not
affected by this change. The Statement of Changes in Net Assets and the
Financial Highlights, for the prior periods, have not been restated to reflect
the changes in this presentation.

(L)  FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Fund's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(M)  INDEXED SECURITIES
The Fund may invest in indexed securities whose value is linked either directly
or indirectly to changes in foreign currencies, interest rates, equities,
indices, or other reference instruments. Indexed securities may be more volatile
than the reference instrument itself, but any loss is limited to the amount of
the original investment.

(N)  RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the period, restricted
securities (excluding 144A issues) are shown at the end of the Fund's Portfolio
of Investments.

2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and administrator. The Fund pays
investment management and administration fees to G.T. Capital at the annualized
rate of 0.975% on the first $500 million of average daily net assets of the
Fund; 0.95% on the next $500 million; 0.925% on the next $500 million and 0.90%
on amounts thereafter. These fees are computed daily and paid monthly, and are
subject to reduction in any year to the extent that the Fund's expenses
(exclusive of brokerage commissions, taxes, interest, distribution-related
expenses and extraordinary expenses) exceed the most stringent limits prescribed
by the laws or regulations of any state in which the Fund's shares are offered
for sale, based on the average total net asset value of the Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended October 31, 1994, G.T. Global retained
$2,477,493 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.

Class B shares were first made available on April 1, 1993. Class B shares are
not subject to initial sales charges. When Class B shares are sold, G.T. Global

                  Statement of Additional Information Page 141
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND
from its own resources pays commissions to dealers through which the sales are
made. Certain redemptions of Class B shares made within six years of purchase
are subject to contingent deferred sales charges ("CDSCs"), in accordance with
the Fund's current prospectus. For the year ended October 31, 1994, G.T. Global
collected CDSCs in the amount of $1,731,244. In addition, G.T. Global makes
ongoing shareholder servicing and trail commission payments to dealers whose
clients hold Class B shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.50% of the average daily net assets of the Fund's
Class A shares, less any amounts paid by the Fund as the aforementioned service
fee, for G.T. Global's expenditures incurred in providing services as
distributor. All expenses for which G.T. Global is reimbursed under the Class A
Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expense) to the maximum annual rate of 2.40% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

3. PURCHASES AND SALES OF SECURITIES
For the year ended October 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $2,543,023,904 and $1,513,013,543, respectively. There
were no purchases or sales of U.S. government obligations by the Fund for the
year ended October 31, 1994.

                  Statement of Additional Information Page 142
<PAGE>
                       GT GLOBAL TELECOMMUNICATIONS FUND

4. CAPITAL SHARES
At October 31, 1994, there were 6,000,000,000 shares of the Company's common
stock authorized, at $0.0001 par value. Of this amount, 400,000,000 were
classified as shares of the Fund; 400,000,000 were classified as shares of G.T.
Global Government Income Fund; 200,000,000 were classified as shares of G.T.
Global Health Care Fund; 200,000,000 were classified as shares of G.T. Global
Strategic Income Fund; 200,000,000 were classified as shares of G.T. Global
Currency Fund (inactive); 200,000,000 were classified as shares of G.T. Global
Growth & Income Fund; 200,000,000 were classified as shares of G.T. Global Small
Companies Fund (inactive); 200,000,000 were classified as shares of G.T. Latin
America Growth Fund; 200,000,000 were classified as shares of G.T. Global
Emerging Markets Fund; 200,000,000 were classified as shares of G.T. Global High
Income Fund; 200,000,000 were classified as shares of G.T. Global Financial
Services Fund; 200,000,000 were classified as shares of G.T. Global Natural
Resources Fund; 200,000,000 were classified as shares of G.T. Global
Infrastructure Fund; 200,000,000 were classified as shares of G.T. Global
Consumer Products and Services Fund (inactive); and 2,800,000,000 shares remain
unclassified. The shares of each of the foregoing series of the Company were
divided equally into two classes, designated Class A and Class B common stock.
Transactions in capital shares of the Fund were as follows:

                           CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
                                                                                    YEAR ENDED                  YEAR ENDED
                                                                                 OCTOBER 31, 1994            OCTOBER 31, 1993
                                                                            --------------------------  --------------------------
CLASS A                                                                       SHARES        AMOUNT        SHARES        AMOUNT
                                                                            -----------  -------------  -----------  -------------
<S>                                                                         <C>          <C>            <C>          <C>
Shares sold...............................................................   49,183,489  $ 833,820,941   43,772,780  $ 640,295,982
Shares issued in connection with reinvestment of distributions............    1,050,827     17,160,181      338,520      3,892,995
                                                                            -----------  -------------  -----------  -------------
                                                                             50,234,316    850,981,122   44,111,300    644,188,977
Shares repurchased........................................................  (30,135,506)  (509,780,043) (11,493,152)  (164,060,126)
                                                                            -----------  -------------  -----------  -------------
Net increase..............................................................   20,098,810  $ 341,201,079   32,618,148  $ 480,128,851
                                                                            -----------  -------------  -----------  -------------
                                                                            -----------  -------------  -----------  -------------

<CAPTION>

                                                                                                              APRIL 1, 1993
                                                                                    YEAR ENDED                      TO
                                                                                 OCTOBER 31, 1994            OCTOBER 31, 1993
                                                                            --------------------------  --------------------------
CLASS B                                                                       SHARES        AMOUNT        SHARES        AMOUNT
                                                                            -----------  -------------  -----------  -------------
<S>                                                                         <C>          <C>            <C>          <C>
Shares sold...............................................................   48,594,410  $ 819,697,227   27,770,391  $ 433,096,276
Shares issued in connection with reinvestment of distributions............      488,736      7,951,722            0              0
                                                                            -----------  -------------  -----------  -------------
                                                                             49,083,146    827,648,949   27,770,391    433,096,276
Shares repurchased........................................................   (9,006,454)  (151,518,558)    (785,039)   (12,515,910)
                                                                            -----------  -------------  -----------  -------------
Net increase..............................................................   40,076,692  $ 676,130,391   26,985,352  $ 420,580,366
                                                                            -----------  -------------  -----------  -------------
                                                                            -----------  -------------  -----------  -------------
</TABLE>

5. WRITTEN OPTIONS
The Fund's written options contracts activity for the year ended October 31,
1994, was as follows:

<TABLE>
<CAPTION>
                                                                                                              SHARES      PREMIUMS
                                                                                                            -----------  ----------
<S>                                                                                                         <C>          <C>
Options outstanding at October 31, 1993...................................................................            0  $        0
Options written...........................................................................................  300,000,000   8,430,000
Options cancelled in closing purchase transactions........................................................            0           0
Options expired prior to exercise.........................................................................            0           0
Options exercised.........................................................................................            0           0
                                                                                                            -----------  ----------
Options outstanding at October 31, 1994...................................................................  300,000,000  $8,430,000
                                                                                                            -----------  ----------
                                                                                                            -----------  ----------
</TABLE>

- --------------
FEDERAL TAX INFORMATION:
For Federal income tax purposes, the Fund had distributions from long-term
capital gains of $22,547,390.

                  Statement of Additional Information Page 143
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 144
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 145
<PAGE>
                             GT GLOBAL THEME FUNDS

                                     NOTES

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

    The accompanying notes are an integral part of the financial statements.

                  Statement of Additional Information Page 146
<PAGE>
                             GT GLOBAL THEME FUNDS

                             GT GLOBAL MUTUAL FUNDS

  GT GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY INVESTORS'
  PORTFOLIOS.  FOR MORE INFORMATION AND  A PROSPECTUS ON ANY  OF THE GT GLOBAL
  MUTUAL FUNDS, PLEASE  CONTACT YOUR  INVESTMENT COUNSELOR OR  CALL GT  GLOBAL
  DIRECTLY AT 1-800-824-1580.

GROWTH FUNDS

/ / GLOBALLY DIVERSIFIED FUNDS

GT GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.

GT GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside the U.S.

GT GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies

/ / GLOBAL THEME FUNDS

GT GLOBAL HEALTH CARE FUND
Invests in the growing health care industries worldwide

GT GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment

GT GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain a country's infrastructure

GT GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products

GT GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources

GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services

/ / REGIONALLY DIVERSIFIED FUNDS

GT GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan

GT GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe

GT GLOBAL LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America

/ / SINGLE COUNTRY FUNDS

GT GLOBAL AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.

GT GLOBAL AMERICA SMALL CAP GROWTH FUND
Invests in equity securities of small U.S. companies

GT GLOBAL AMERICA VALUE FUND
Concentrates on equity securities of large cap U.S. companies believed to be
undervalued

GT GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market

GROWTH AND INCOME FUNDS

GT GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world

FIXED INCOME FUNDS

GT GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities

GT GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets

GT GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets

MONEY MARKET FUND

GT GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital

[LOGO]

  NO  DEALER,  SALESMAN  OR  OTHER  PERSON HAS  BEEN  AUTHORIZED  TO  GIVE ANY
  INFORMATION OR TO MAKE ANY  REPRESENTATION NOT CONTAINED IN THIS  PROSPECTUS
  AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
  UPON  AS HAVING  BEEN AUTHORIZED BY  G.T. INVESTMENT FUNDS,  INC., GT GLOBAL
  FINANCIAL SERVICES  FUND, GLOBAL  FINANCIAL  SERVICES PORTFOLIO,  GT  GLOBAL
  INFRASTRUCTURE  FUND,  GLOBAL  INFRASTRUCTURE PORTFOLIO,  GT  GLOBAL NATURAL
  RESOURCES FUND,  GLOBAL  NATURAL  RESOURCES PORTFOLIO,  GT  GLOBAL  CONSUMER
  PRODUCTS AND SERVICES FUND, GLOBAL CONSUMER PRODUCTS AND SERVICES PORTFOLIO,
  GT  GLOBAL HEALTH  CARE FUND, GT  GLOBAL TELECOMMUNICATIONS  FUND, LGT ASSET
  MANAGEMENT, INC. OR GT GLOBAL, INC.  THIS PROSPECTUS DOES NOT CONSTITUTE  AN
  OFFER  TO SELL  OR SOLICITATION OF  ANY OFFER  TO BUY ANY  OF THE SECURITIES
  OFFERED HEREBY IN  ANY JURISDICTION TO  ANY PERSON IN  SUCH JURISDICTION  TO
  WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER.

                                                                      THESA601MC


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