March 15, 1996
THE JAMESTOWN BOND FUNDS
Supplement to Prospectus Dated August 1, 1995
The second paragraph on page 1 of the Prospectus has been replaced with
the following:
The investment objective of THE JAMESTOWN SHORT TERM BOND FUND (the "Short Term
Fund") is identical to that of the Bond Fund, with the distinction that the
Short Term Fund intends to achieve this objective by investing in a portfolio of
investment grade fixed income securities having a shorter average duration.
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The third paragraph on page 2 of the Prospectus has been replaced with
the following:
INVESTMENT APPROACH. The Advisor's philosophy in managing fixed income
portfolios is to emphasize a disciplined balance between sector selection and
moderate portfolio duration shifts to maximize total return. Duration is an
important concept in the Advisor's fixed income management philosophy and, in
the Advisor's opinion, provides a better measure of interest rate sensitivity
than maturity for many fixed income securities. Each Fund intends to invest only
in investment grade securities. Due to their controlled duration and quality
standards, the Funds expect to exhibit less volatility than would mutual funds
with longer average maturities and lower quality portfolios.
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The second paragraph on page 7 of the Prospectus has been replaced with
the following:
Each Fund invests exclusively in those securities rated investment grade by one
or more of the NRSROs or, if not rated, are considered by the Advisor to have
essentially the same characteristics and quality as securities having such
ratings. There may also be instances where the Advisor purchases securities
which are rated investment grade by one NRSRO and which are not rated or rated
below investment grade by other NRSROs, and such securities would be eligible
for purchase by the Funds. Issues rated within the fourth highest grade (those
rated lower than A) are considered speculative in certain respects and changes
in economic conditions or other circumstances are more likely to lead to a
weakened capacity to pay principal and interest than is the case with higher
grade securities. The final determination of quality and value will remain with
the Advisor. Although the Advisor utilizes the ratings of various credit rating
services as one factor in establishing creditworthiness, it relies primarily
upon it own analysis of factors establishing creditworthiness. For as long as
the Funds hold a fixed income issue, the Advisor monitors the issuer's credit
standing. In the event a security's rating is reduced below a Fund's minimum
requirements, the Fund will sell the security, subject to market conditions and
the Advisor's assessment of the most opportune time for sale. Although lower
rated securities will generally provide higher yields than higher rated
securities of similar maturities, they are subject to a
greater degree of market fluctuation.
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