File Nos. 33-27172
811-5716
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 9 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 9 [X]
(Check appropriate box or boxes.)
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
(D/B/A/ DREYFUS STOCK INDEX FUND)
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate
box)
immediately upon filing pursuant to paragraph (b)
----
X on May 1, 1997 pursuant to paragraph (b)
----
60 days after filing pursuant to paragraph (a)(i)
----
on (date) pursuant to paragraph (a)(i)
----
75 days after filing pursuant to paragraph (a)(ii)
----
on (date) pursuant to paragraph (a)(ii) of Rule 485
----
If appropriate, check the following box:
this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
----
Registrant has registered an indefinite number of shares of its common
stock under the Securities Act of 1933 pursuant to Section 24(f) of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for the
fiscal year ended December 31, 1996 was filed on February 26, 1997.
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
_________ _______ ____
1 Cover Page Cover
2 Synopsis *
3 Condensed Financial Information 3
4 General Description of Registrant 3, 9
5 Management of the Fund 6
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 9
7 Purchase of Securities Being Offered 7
8 Redemption or Repurchase 7
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
- ---------
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History B-18
13 Investment Objectives and Policies B-2
14 Management of the Fund B-6
15 Control Persons and Principal B-11
Holders of Securities
16 Investment Advisory and Other B-11
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
_________ _______ _____
17 Brokerage Allocation B-17
18 Capital Stock and Other Securities B-17
19 Purchase, Redemption and Pricing B-14
of Securities Being Offered
20 Tax Status B-15
21 Underwriters B-11
22 Calculations of Performance Data B-18
23 Financial Statements B-21
Items in
Part C of
Form N-1A
_________
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-3
Investment Adviser
29 Principal Underwriters C-8
30 Location of Accounts and Records C-11
31 Management Services C-11
32 Undertakings C-11
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
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PROSPECTUS MAY 1, 1997
DREYFUS STOCK INDEX FUND
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DREYFUS STOCK INDEX FUND (THE "FUND") IS AN OPEN-END, NON-DIVERSIFIED,
MANAGEMENT INVESTMENT COMPANY, KNOWN AS A MUTUAL FUND. Fund shares are
offered only to variable annuity and variable life insurance separate
accounts established by insurance companies ("Participating Insurance
Companies") to fund variable annuity contracts and variable life
insurance policies. INDIVIDUALS MAY NOT PURCHASE FUND SHARES DIRECTLY FROM
THE FUND. THIS PROSPECTUS SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS
OF THE SEPARATE ACCOUNTS OF THE SPECIFIC INSURANCE PRODUCT WHICH SHOULD
PRECEDE OR ACCOMPANY THIS PROSPECTUS.
THE FUND'S INVESTMENT OBJECTIVE IS TO PROVIDE INVESTMENT RESULTS THAT
CORRESPOND TO THE PRICE AND YIELD PERFORMANCE OF PUBLICLY TRADED COMMON
STOCKS IN THE AGGREGATE, AS REPRESENTED BY THE STANDARD & POOR'S 500
COMPOSITE STOCK PRICE INDEX. IN ANTICIPATION OF TAKING A MARKET POSITION, THE
FUND IS PERMITTED TO PURCHASE AND SELL STOCK INDEX FUTURES. THE FUND IS
NEITHER SPONSORED BY NOR AFFILIATED WITH STANDARD & POOR'S.
THE DREYFUS CORPORATION ("DREYFUS") SERVES AS THE FUND'S MANAGER.
DREYFUS HAS ENGAGED ITS AFFILIATE, MELLON EQUITY ASSOCIATES ("MELLON
EQUITY"), TO SERVE AS THE FUND'S INDEX FUND MANAGER AND PROVIDE DAY-TO-DAY
MANAGEMENT OF THE FUND'S INVESTMENTS. DREYFUS AND MELLON EQUITY ARE
COLLECTIVELY REFERRED TO AS THE "ADVISERS."
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE
REFERENCE.
THE STATEMENT OF ADDITIONAL INFORMATION, DATED MAY 1, 1997, WHICH MAY
BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF CERTAIN AREAS
IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST TO SOME
INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS INCORPORATED HEREIN BY REFERENCE. THE SECURITIES AND EXCHANGE COMMISSION
MAINTAINS A WEB SITE (HTTP://WWW.SEC.GOV) THAT CONTAINS THE STATEMENT OF
ADDITIONAL INFORMATION, MATERIAL INCORPORATED BY REFERENCE, AND OTHER
INFORMATION REGARDING THE FUND. FOR A FREE COPY OF THE STATEMENT OF
ADDITIONAL INFORMATION, WRITE TO THE FUND AT 144 GLENN CURTISS BOULEVARD,
UNIONDALE, NEW YORK 11556-0144, OR CALL 1-800-645-6561. WHEN TELEPHONING, ASK
FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. THE NET ASSET VALUE OF FUNDS OF THIS TYPE WILL FLUCTUATE FROM TIME TO
TIME.
TABLE OF CONTENTS
Page
Condensed Financial Information.................... 3
Description of the Fund............................ 4
Management of the Fund............................. 6
How to Buy Shares.................................. 7
How to Redeem Shares............................... 7
Shareholder Services Plan.......................... 8
Dividends, Distributions and Taxes................. 8
Performance Information............................ 9
General Information................................ 9
Appendix........................................... 11
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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[This Page Intentionally Left Blank]
Page 2
CONDENSED FINANCIAL INFORMATION
The information in the following table has been audited by Coopers &
Lybrand L.L.P., the Fund's independent accountants, whose report thereon
covering the periods ending 1990 to 1996 appears in the Statement of
Additional Information. Further financial data and related notes are included
in the Statement of Additional Information, available upon request.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share
of Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements. The Fund's
total investment return shown below does not include expenses charged a
separate account or related insurance policy by a Participating Insurance
Company, inclusion of which would reduce the Fund's total investment return
for each period indicated.
<TABLE>
<CAPTION>
FOUR MONTHS
YEAR ENDED ENDED YEAR ENDED
AUGUST 31, DECEMBER 31, DECEMBER 31,
--------------------------------- ---------------------------------- -------------
PER SHARE DATA: 1990(1) 1991 1992 1992(2) 1993 1994 1995 1996
------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $12.50 $11.62 $14.20 $14.87 $15.32 $13.20 $12.94 $17.20
------ ------ ------ ------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income-net......... .38 .39 .37 .13 .37 .32 .33 .39
Net realized and unrealized gain
(loss) on investments (.95) 2.60 .68 .77 1.04 (.21) 4.39 3.43
------ ------ ------ ------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS..... (.57) 2.99 1.05 .90 1.41 .11 4.72 3.82
------ ------ ------ ------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment
income-net (.31) (.39) (.38) (.21) (.34) (.31) (.33) (.39)
Dividends in excess of
investment income-net .-- .-- .-- .-- (.03) .-- .-- .--
Dividends from net realized
gain on investments .-- (.02) ._- (.24) (3.00) .-- (.13) (.35)
Dividends in excess of net realized
gain on investments .-- .-- ._- ._- (.16) (.06) .-- .--
------ ------ ------ ------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS (.31) (.41) (.38) (.45) (3.53) (.37) (.46) (.74)
------ ------ ------ ------ ------ ------ ------ ------
Net asset value, end of year.. $11.62 $14.20 $14.87 $15.32 $13.20 $12.94 $17.20 $20.28
====== ====== ====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN...... (4.73%)(3) 26.26% 7.49% 6.05%(3) 9.33% .88% 36.78% 22.54%
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses
to average net assets .37%(3) .40% .40% .13%(3) .40% .40% .39% .30%
Ratio of net investment income
to average net assets 3.12%(3) 3.05% 2.63% .85%(3) 2.38% 2.56% 2.38% 2.24%
Decrease reflected in
above expense ratios
due to undertakings .17%(3) .11% .13% .03%(3) .27% .16% .03% .--
Portfolio Turnover Rate..... .99%(3) 1.02% 7.66% 6.94%(3) 71.71% 2.82% 11.95% 10.92%
Average Commission Rate paid(4) .-- .-- .-- .-- .-- .-- .-- $.0317
Net Assets, end of year
(000's omitted) $48,184 $62,400 $74,446 $70,072 $61,319 $96,806 $312,686 $813,959
(1) From September 29, 1989 (commencement of operations) to August 31, 1990.
(2) Effective September 1, 1992, the Fund changed its fiscal year-end from August 31 to December 31.
The figures provided are from September 1, 1992 to December 31, 1992.
(3) Not annualized.
(4) For fiscal years beginning January 1, 1996, the Fund is required to disclose its average commission rate paid per
share for purchases and sales of investment securities.
</TABLE>
Further information about the Fund's performance is contained in the
Fund's annual report, which may be obtained without charge by writing to the
address or calling the number set forth on the cover page of this Prospectus.
Page 3
DESCRIPTION OF THE FUND
GENERAL
The Fund is intended to be a funding vehicle for variable annuity
contracts ("VA contracts") and variable life insurance policies ("VLI
policies") to be offered by the Participating Insurance Companies. The Fund
currently does not foresee any disadvantages to the holders of VA contracts
and VLI policies arising from the fact that the interests of the holders of
such contracts and policies may differ. Nevertheless, the Fund's Board
intends to monitor events in order to identify any material conflicts which
may arise and to determine what action, if any, should be taken in response
thereto. The VA contracts and the VLI policies are described in the separate
prospectuses issued by the Participating Insurance Companies over which the
Fund assumes no responsibility.
Individual VA contract holders and VLI policy holders are not the
"shareholders" of the Fund. Rather, the Participating Insurance Companies and
their separate accounts are the shareholders (the "shareholders"), although
such companies may pass through voting rights to their VA contract holders
and VLI policy holders.
INVESTMENT OBJECTIVE
The Fund's investment objective is to provide investment results that
correspond to the price and yield performance of publicly traded common
stocks in the aggregate, as represented by the Standard & Poor's 500
Composite Stock Price Index* (the "Index"). It cannot be changed without
approval by the holders of a majority (as defined in the Investment Company
Act of 1940, as amended (the "1940 Act")) of the Fund's outstanding voting
shares. There can be no assurance that the Fund's investment objective will
be achieved.
MANAGEMENT POLICIES
The Fund attempts to duplicate the investment results of the Index,
which is composed of 500 selected common stocks, most of which are listed on
the New York Stock Exchange. Standard & Poor's ("S&P") chooses the stocks to
be included in the Index solely on a statistical basis. The Fund attempts to
be fully invested at all times in the stocks that comprise the Index and
stock index futures as described below and, in any event, at least 80% of the
Fund's net assets will be so invested. Inclusion of a stock in the Index in
no way implies an opinion by S&P as to its attractiveness as an investment.
The Fund uses the Index as the standard performance comparison because it
represents approximately 70% of the total market value of all common stocks
and is well known to investors. An investment in the Fund involves risks
similar to those of investing in common stocks.
The weightings of stocks in the Index are based on each stock's
relative total market capitalization; that is, its market price per share
times the number of shares outstanding. Because of this weighting, as of
November 29, 1996, approximately 46.3% of the Index was composed of the 50
largest companies. The Advisers generally select stocks for the Fund's
portfolio in the order of their weightings in the Index beginning with the
heaviest weighted stocks. With respect to the Fund's assets invested in the
stocks in the Index, the percentage of such assets invested in each stock is
approximately the same as the percentage it represents in the Index.
No attempt is made to manage the portfolio in the traditional sense
using economic, financial and market analysis. The Fund is managed using a
computer program to determine which stocks are to be purchased or sold to
replicate the Index to the extent feasible. From time to time, administrative
adjustments may be made in the Fund's portfolio because of changes in the
composition of the Index, but such changes should be infrequent.
The Fund believes that the indexing approach described above is an
effective method of substantially duplicating percentage changes in the
Index. It is a reasonable expectation that there will be a close correlation
between the Fund's performance and that of the Index in both rising and
falling markets. The Fund will attempt to achieve a correlation between the
performance of its portfolio and that of the Index of at least 0.95, without
taking into account expenses. A correlation of 1.00 would indicate perfect
correlation, which would be achieved when the Fund's net asset value,
including the value of its dividends and capital gains distributions,
increases or decreases in exact proportion to changes in the Index. The
Fund's ability to correlate its performance with the Index, however, may be
affected by, among other things, changes in securities markets, the manner in
which the
- ----------------------
*"Standard & Poor's 500," "S&P 500Registration Mark" and "S&PRegistration
Mark"are trademarks of The McGraw-Hill Companies, Inc. and have been licensed
for use. The Fund is not sponsored, endorsed, sold or promoted by S&P or The
McGraw-Hill Companies, Inc.
Page 4
Index is calculated by S&P and the timing of purchases and redemptions. In
the future, the Fund's Board, subject to the approval of shareholders, may
select another index if such a standard of comparison is deemed to be more
representative of the performance of common stocks.
The Fund's ability to duplicate the performance of the Index also
depends to some extent on the size of the Fund's portfolio and the size of
cash flows into and out of the Fund. Investment changes to accommodate these
cash flows are made to maintain the similarity of the Fund's portfolio to the
Index to the maximum practicable extent.
From time to time to increase its income, the Fund may lend
securities from its portfolio. See "Appendix _ Investment Techniques." When
the Fund has cash reserves, the Fund may invest in money market instruments
consisting of U.S. Government securities, time deposits, certificates of
deposit, bankers' acceptances, high-grade commercial paper, and repurchase
agreements. See the Statement of Additional Information for a description of
these instruments. The Fund also may purchase stock index futures in
anticipation of taking a market position when, in the opinion of the Advisers,
available cash balances do not permit an economically efficient trade in the
cash market. The Fund also may sell stock index futures to terminate existing
positions it may have as a result of its purchases of stock index futures.
See also "Investment Considerations and Risks" and "Appendix _ Investment
Techniques" below, and "Investment Objective and Management Policies" in the
Statement of Additional Information.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL -- The Fund's net asset value per share should be expected to
fluctuate. Investors should consider the Fund as a supplement to an overall
investment program and should invest only if they are willing to undertake
the risks involved. See "Investment Objective and Management Policies" in the
Statement of Additional Information for a further discussion of certain
risks.
EQUITY SECURITIES -- Equity securities fluctuate in value, often based on
factors unrelated to the value of the issuer of the securities, and such
fluctuations can be pronounced. Changes in the value of the Fund's
investments will result in changes in the value of its shares and thus the
Fund's total return to investors.
FOREIGN SECURITIES -- Since the stocks of some foreign issuers are included
in the Index, the Fund's portfolio may contain securities of such foreign
issuers which may subject the Fund to additional investment risks with
respect to those securities that are different in some respects from those
incurred by a fund which invests only in securities of domestic issuers. Such
risks include possible adverse political and economic developments, seizure
or nationalization of foreign deposits or adoption of governmental restrictions
which might adversely affect or restrict the payment of principle and
interest on the foreign securities to investors located outside the country
of the issuer, whether from currency blockage or otherwise.
USE OF DERIVATIVES -- The Fund may invest, to a limited extent, in
derivatives ("Derivatives"). These are financial instruments which derive
their performance, at least in part, from the performance of an underlying
asset or index. The Derivatives the Fund may use include stock index futures.
While Derivatives can be used effectively in furtherance of the Fund's
investment objective, under certain market conditions, they can increase the
volatility of the Fund's net asset value, decrease the liquidity of the
Fund's portfolio and make more difficult the accurate pricing of the Fund's
portfolio. See "Appendix _Investment Techniques _ Use of Derivatives" below
and " Investment Objective and Management Policies _ Management Policies _
Derivatives" in the Statement of Additional Information.
NON-DIVERSIFIED STATUS -- The classification of the Fund as a
"non-diversified" investment company means that the proportion of the Fund's
assets that may be invested in the securities of a single issuer is not
limited by the 1940 Act. A "diversified" investment company is required by
the 1940 Act generally, with respect to 75% of its total assets, to invest
not more than 5% of such assets in the securities of a single issuer. Since a
relatively high percentage of the Fund's assets may be invested in the
securities of a limited number of issuers, some of which may be within the
same economic sector, the Fund's portfolio may be more sensitive to the
changes in market value of a single issuer or industry. However, to meet
Federal tax requirements, at the close of each quarter the Fund may not have
more than 25% of its total assets invested in any one issuer and, with
respect to 50% of total assets, not more than 5% of its total assets invested
in any one issuer. These limitations do not apply to U.S. Government
securities.
Page 5
SIMULTANEOUS INVESTMENTS -- Investment decisions for the Fund are made
independently from those of the other investment companies or accounts
advised by Dreyfus or Mellon Equity. If, however, such other investment
companies or accounts desire to invest in, or dispose of, the same securities
as the Fund, available investments or opportunities for sales will be
allocated equitably to each. In some cases, this procedure may adversely
affect the size of the position obtained for or disposed of by the Fund or
the price paid or received by the Fund.
MANAGEMENT OF THE FUND
ADVISERS -- Dreyfus, located at 200 Park Avenue, New York, New York 10166,
was formed in 1947 and serves as the Fund's manager. Dreyfus is a
wholly-owned subsidiary of Mellon Bank, N.A., which is a wholly-owned
subsidiary of Mellon Bank Corporation ("Mellon"). As of January 31, 1997,
Dreyfus managed or administered approximately $85 billion in assets for
approximately 1.7 million investor accounts nationwide.
Dreyfus supervises and assists in the overall management of the
Fund's affairs under a Management Agreement with the Fund, subject to the
authority of the Fund's Board in accordance with Maryland law.
Dreyfus has engaged Mellon Equity, located at 500 Grant Street,
Pittsburgh, Pennsylvania 15258, to serve as the Fund's index fund manager.
Mellon Equity, a registered investment adviser formed in 1957, is an indirect
wholly-owned subsidiary of Mellon and, thus, an affiliate of Dreyfus. As of
December 31, 1996, Mellon Equity and its employees managed approximately
$11.3 billion in assets and served as the investment adviser of 14 other
investment companies.
Mellon Equity, subject to the supervision and approval of Dreyfus,
provides the day-to-day management of the Fund's investments, as well as
statistical information, under an Index Management Agreement with Dreyfus,
subject to the overall authority of the Fund's Board in accordance with
Maryland law.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including Dreyfus, Mellon managed more than $233 billion in
assets as of December 31, 1996, including approximately $86 billion in
proprietary mutual fund assets. As of December 31, 1996, Mellon, through
various subsidiaries, provided non-investment services, such as custodial or
administration services, for more than $1.046 trillion in assets, including
approximately $57 billion in mutual fund assets.
For the fiscal year ended December 31, 1996, the Fund paid Dreyfus a
monthly management fee at the annual rate of .245 of 1% of the value of the
Fund's average daily net assets, and Dreyfus paid Mellon Equity an index
management fee at the annual rate of .095 of 1% of the value of the Fund's
average daily net assets. Under the Index Management Agreement, Mellon Equity
has agreed to pay for the provision of custody services to the Fund by Boston
Safe Deposit and Trust Company.
The imposition of the Fund's management fee, as well as other
operating expenses, will have the effect of reducing investors' return and
will affect the Fund's ability to track the Index exactly. Dreyfus has
undertaken that, until such time as it gives shareholders at least 180 days
notice to the contrary, if in any fiscal year the aggregate expenses of the
Fund (excluding brokerage commissions, transaction fees and extraordinary
expenses) exceed .40 of 1% of the value of the Fund's average net assets for
the fiscal year, the Fund may deduct from the payment to be made to Dreyfus,
or Dreyfus will bear, such excess expense. In addition, from time to time,
Dreyfus may waive receipt of its fees and/or voluntarily assume certain
expenses of the Fund, which would have the effect of lowering the expense
ratio of the Fund and increasing yield to investors. The Fund will not pay
Dreyfus at a later time for any amounts Dreyfus may waive, nor will the Fund
reimburse Dreyfus for any amounts Dreyfus may assume.
In allocating brokerage transactions, the Advisers seek to obtain the
best execution of orders at the most favorable net price. Subject to this
determination, the Advisers may consider, among other things, the receipt of
research services and/or the sale of shares of the Fund or other funds
advised by Dreyfus or Mellon Equity as
Page 6
factors in the selection of broker-dealers to execute portfolio transactions
for the Fund. See "Portfolio Transactions" in the Statement of Additional
Information.
The Dreyfus Corporation, from time to time, may make payments from
its own assets to Participating Insurance Companies in connection with the
provision of certain administrative services to the Fund and/or to purchasers
of VA contracts or VLI policies.
DISTRIBUTOR -- The Fund's distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109.
The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN -- Dreyfus Transfer,
Inc., a wholly-owned subsidiary of Dreyfus, P.O. Box 9671, Providence, Rhode
Island 02940-9671, is the Fund's Transfer and Dividend Disbursing Agent (the
"Transfer Agent"). Boston Safe Deposit and Trust Company, an indirect
subsidiary of Mellon, One Boston Place, Boston, Massachusetts 02108, is the
Custodian of the Fund's investments.
HOW TO BUY SHARES
FUND SHARES CURRENTLY ARE OFFERED ONLY TO SEPARATE ACCOUNTS OF
PARTICIPATING INSURANCE COMPANIES. INDIVIDUALS MAY NOT PLACE PURCHASE ORDERS
DIRECTLY WITH THE FUND.
Separate accounts of the Participating Insurance Companies place
orders based on, among other things, the amount of premium payments to be
invested pursuant to VA contracts and VLI policies. See the prospectus of the
separate account of the applicable Participating Insurance Company for more
information on the purchase of Fund shares.
If an order is received by the Fund or its agent by the close of
trading on the floor of the New York Stock Exchange (currently 4:00 p.m., New
York time) on a business day, Fund shares will be purchased at the net asset
value determined as of such close of trading on the day the order is
received. Otherwise, Fund shares will be purchased at the net asset value
determined as of the close of trading on the floor of the New York Stock
Exchange on the next business day.
Fund shares are sold on a continuous basis. Net asset value per share
is determined as of the close of trading on the floor of the New York Stock
Exchange on each day the New York Stock Exchange is open for business. For
purposes of determining net asset value, futures contracts will be valued 15
minutes after the close of trading on the floor of the New York Stock
Exchange. Net asset value per share is computed by dividing the value of the
Fund's net assets (i.e., the value of its assets less liabilities) by the
total number of shares outstanding. The Fund's investments are valued based
on market value, or where market quotations are not readily available, based
on fair value as determined in good faith by the Fund's Board. For further
information regarding the methods employed in valuing the Fund's investments,
see "Determination of Net Asset Value" in the Statement of Additional
Information.
HOW TO REDEEM SHARES
Fund shares may be redeemed at any time by the separate accounts of
the Participating Insurance Companies. INDIVIDUALS MAY NOT PLACE REDEMPTION
ORDERS DIRECTLY WITH THE FUND. When the Fund or its agent receives a request
in proper form by the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m., New York time), the Fund will redeem the
shares at the net asset value determined as of the close of such trading on
the day the request is received. To maximize the Fund's ability to track the
Index, separate accounts of Participating Insurance Companies are urged to
transmit redemption requests so that they may be received by the Fund or its
agent prior to 12:00 noon, New York time, on the day upon which separate
accounts of Participating Insurance Companies want their redemption requests
to be effective. The value of the shares redeemed may be more or less than
their original cost, depending on the Fund's then-current net asset value. No
charges are imposed by the Fund when shares are redeemed.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission.
Page 7
Should any conflict between VA contract holders and VLI policy
holders arise which would require that a substantial amount of net assets be
withdrawn, orderly portfolio management could be disrupted to the potential
detriment of such contract and policy holders.
SHAREHOLDER SERVICES PLAN
The Fund has adopted a Shareholder Services Plan pursuant to which
the Fund reimburses Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, an amount not to exceed an annual rate of .25 of 1% of the value of
the Fund's average daily net assets for certain allocated expenses with
respect to servicing and/or maintaining shareholder accounts.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund ordinarily declares and pays dividends from net investment
income quarterly, and automatically reinvests them in additional Fund shares
at net asset value or, at the shareholder's option, pays them in cash. The
Fund makes distributions from net realized securities gains, if any, once a
year, but may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code of 1986, as amended
(the "Code"), in all events in a manner consistent with the provisions of the
1940 Act. The Fund will not make distributions from net realized securities
gains unless capital loss carryovers, if any, have been utilized or have
expired. If all shares in an account are redeemed at any time, all dividends
to which the shareholder is entitled will be paid along with the proceeds of
the redemption. An omnibus accountholder may indicate in a partial redemption
request that a portion of any accrued dividends to which such account is
entitled belongs to an underlying accountholder who has redeemed all shares
in his or her account, and such portion of the accrued dividends will be paid
to the accountholder along with the proceeds of the redemption. All expenses
are accrued daily and deducted before declaration of dividends to investors.
Section 817(h) of the Code requires that the investments of a
segregated asset account of an insurance company be "adequately diversified''
as provided therein or in accordance with U.S. Treasury Regulations, in order
for the account to serve as the basis for VA contracts or VLI policies.
Section 817(h) and the U.S. Treasury Regulations issued thereunder provide
the manner in which a segregated asset account will treat investments in a
regulated investment company for purposes of the diversification requirements.
If the Fund satisfies certain conditions, a segregated asset account owning
shares of the Fund will be treated as owning multiple investments consisting
of the account's proportionate share of each of the assets of the Fund. The
Fund intends to satisfy these conditions so that the shares of the Fund owned
by a segregated asset account of a Participating Insurance Company will be
treated as multiple investments. Further, the Fund intends to satisfy the
diversification standards prescribed under Section 817(h) for segregated
accounts. By meeting these and other requirements, the Participating
Insurance Companies, rather than VA contract holders or VLI policy holders,
should be subject to tax on distributions received with respect to Fund shares.
The tax treatment on distributions made to a Participating Insurance
Company will depend on the Participating Insurance Company's tax status.
Notice as to the tax status of dividends and distributions will be
mailed to shareholders annually. Dividends derived from net investment
income, together with distributions of net realized short-term securities
gains, generally are taxable as ordinary income whether received in cash or
reinvested in additional Fund shares. Distributions from net realized
long-term securities gains generally are taxable as long-term capital gains
whether received in cash or reinvested in additional Fund shares. Since the
Fund's shareholders are the Participating Insurance Companies and their
separate accounts, no discussion is included herein as to the Federal income
tax consequences to VA contract holders and VLI policy holders. For
information concerning the Federal income tax consequences to such holders,
see the prospectus for such contract or policy.
Management of the Fund believes that the Fund has qualified for the
fiscal year ended December 31, 1996 as a "regulated investment company" under
the Code. The Fund intends to continue to so qualify if such qualification is
in the best interest of its shareholders. Qualification as a regulated
investment company relieves the Fund of any liability for Federal income
taxes to the extent its earnings are distributed in accordance with
Page 8
applicable provisions of the Code. The Fund is subject to a non-deductible 4%
excise tax, measured with respect to certain undistributed amounts of taxable
investment income and capital gains.
Participating Insurance Companies should consult their tax advisers
regarding specific questions as to Federal, state or local taxes.
PERFORMANCE INFORMATION
For the purpose of advertising, performance is calculated on the
basis of average annual total return and/or total return.
Average annual total return is calculated pursuant to a standardized
formula which assumes that an investment in the Fund was purchased with an
initial payment of $1,000 and that the investment was redeemed at the end of
a stated period of time, after giving effect to the reinvestment of dividends
and distributions during the period. The return is expressed as a percentage
rate which, if applied on a compounded annual basis, would result in the
redeemable value of the investment at the end of the period. Advertisements
of the Fund's performance will include the Fund's average annual total return
for one, five and ten year periods, or for shorter time periods depending
upon the length of time during which the Fund has operated.
Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the income
and principal changes for a specified period and dividing by the net asset
value per share at the beginning of the period. Advertisements may include
the percentage rate of total return or may include the value of a
hypothetical investment at the end of the period which assumes the
application of the percentage rate of total return.
Performance will vary from time to time and past results are not
necessarily representative of future results. Performance information, such
as that described above, may not provide a basis for comparison with other
investments or other investment companies using a different method of
calculating performance.
The Fund's average annual total return and total return should not be
compared with other funds that offer their shares directly to the public
since the figures provided do not reflect charges of Participating Insurance
Companies. In addition, the Fund's total return should be distinguished from
the rate of return of a separate account or investment division of a separate
account of a Participating Insurance Company, which rate will reflect the
deduction of additional charges, including mortality and expense risk
charges, and therefore will be lower. VA contract holders and VLI policy
holders should consult the prospectus for such contract or policy.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Standard &
Poor's 500 Composite Stock Price Index, Standard & Poor's MidCap 400 Index,
Lipper Analytical Services, Inc., the Dow Jones Industrial Average, Money
Magazine, Morningstar, Inc. and other industry publications. The Fund may
cite in its advertisements or in reports or other communications to
shareholders, historical performance of unmanaged indices as reported in
Ibbotson, Roger G. and Rex A. Sinquefield, Stocks, Bonds, Bills and Inflation
(SBBI), updated annually in the SBBI Yearbook, Ibbotson Associates, Chicago.
In its advertisements, the Fund also may cite the aggregate amount of assets
committed to index investing by pension funds and/or other institutional
investors, and may refer to or discuss then current or past economic or
financial conditions, developments or events.
GENERAL INFORMATION
The Fund was incorporated under Maryland law on January 24, 1989, and
commenced operations on September 29, 1989. On May 1, 1994, the Fund, which
is incorporated under the name Dreyfus Life and Annuity Index Fund, Inc.,
began operating under the name Dreyfus Stock Index Fund. The Fund is
authorized to issue 200 million shares of Common Stock, par value $.001 per
share. Each share has one vote. In accordance with current law, the Fund
anticipates that a Participating Insurance Company issuing a VA contract or
VLI policy that participates in the Fund will request voting instructions
from contract and policy holders and will vote shares in proportion to the
voting instructions received. For further information on voting rights, see
the applicable prospectus of the Participating Insurance Company.
Page 9
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for the Fund to hold annual meetings of shareholders. As a result,
Fund shareholders may not consider each year the election of Board members or
the appointment of auditors. However, pursuant to the Fund's By-Laws, the
holders of at least 10% of the shares outstanding and entitled to vote may
require the Fund to hold a special meeting of shareholders for purposes of
removing a Board member from office and the holders of at least 25% of such
shares may require the Fund to hold a special meeting of shareholders for any
other purpose. Fund shareholders may remove a Board member by the affirmative
vote of a majority of the Fund's outstanding voting shares. In addition, the
Fund's Board will call a meeting of shareholders for the purpose of electing
Board members if, at any time, less than a majority of the Board members then
holding office have been elected by shareholders.
The Transfer Agent maintains a record of shareholder ownership and
sends confirmations and statements of account.
Owners of policies and contracts issued by a Participating Insurance
Company for which shares of the Fund are an investment vehicle will receive
from the Participating Insurance Company unaudited semi-annual financial
statements and audited year-end financial statements certified by the Fund's
independent public accountants. Each report will show the investments owned
by the Fund and the market values thereof and will provide other information
about the Fund and its operations.
Shareholder inquiries may be made by writing to the Fund at 144 Glenn
Curtiss Boulevard, Uniondale, New York 11566-0144, or by calling toll free
1-800-645-6561. In New York City, call 1-718-895-1206; outside the U.S. and
Canada, call 516-794-5452.
The Fund is not sponsored, endorsed, sold or promoted by S&P. S&P
makes no representation or warranty, express or implied, to the owners of the
Fund or any member of the public regarding the advisability of investing in
securities generally or in the Fund particularly or the ability of the S&P
500 Index to track general stock market performance. S&P's only relationship
to the Fund is the licensing of certain trademarks and trade names of S&P and
of the S&P 500 Index which is determined, composed and calculated by S&P
without regard to the Fund. S&P has no obligation to take the needs of the
Fund or the owners of the Fund into consideration in determining, composing
or calculating the S&P 500 Index. S&P is not responsible for and has not
participated in the calculation of the Fund's net asset value, nor is S&P a
distributor of the Fund. S&P has no obligation or liability in connection
with the administration, marketing or trading of the Fund.
S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE
S&P 500 INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO WARRANTY, EXPRESS OR
IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE FUND, OWNERS OF THE FUND, OR ANY
OTHER PERSON OR ENTITY FROM THE USE OF THE S&P 500 INDEX OR ANY DATA INCLUDED
THEREIN. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS
ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE
WITH RESPECT TO THE S&P 500 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY LIABILITY FOR
ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
Page 10
APPENDIX
INVESTMENT TECHNIQUES
BORROWING MONEY -- The Fund is permitted to borrow money only for temporary
or emergency (not leveraging) purposes, in an amount up to 5% of the value of
its total assets (including the amount borrowed) valued at the lesser of cost
or market, less liabilities (not including the amount borrowed) at the time
the borrowing is made.
USE OF DERIVATIVES -- The Fund may invest in the types of Derivatives
enumerated under "Description of the Fund -- Investment Considerations and
Risks -- Use of Derivatives." These instruments and certain related risks are
described more specifically under "Investment Objective and Management
Policies -- Management Policies -- Derivatives" in the Statement of
Additional Information.
Although the Fund will not be a commodity pool, certain Derivatives
subject the Fund to the rules of the Commodity Futures Trading Commission
which limit the extent to which the Fund can invest in such Derivatives. The
Fund may invest in stock index futures contracts for hedging purposes without
limit. However, the Fund may not invest in such contracts for other purposes
if the sum of the amount of initial margin deposits, other than for bona fide
hedging purposes, exceeds 5% of the liquidation value of the Fund's assets,
after taking into account unrealized profits and unrealized losses on such
contracts.
LENDING PORTFOLIO SECURITIES -- The Fund may lend securities from its
portfolio to brokers, dealers and other financial institutions needing to
borrow securities to complete certain transactions. The Fund continues to be
entitled to payments in amounts equal to the interest, dividends or other
distributions payable on the loaned securities which affords the Fund an
opportunity to earn interest on the amount of the loan and on the loaned
securities' collateral. Loans of portfolio securities may not exceed 30% of
the value of the Fund's total assets, and the Fund will receive collateral
consisting of cash, U.S. Government securities or irrevocable letters of
credit which will be maintained at all times in an amount equal to at least
100% of the current market value of the loaned securities. Such loans are
terminable by the Fund at any time upon specified notice. The Fund might
experience risk of loss if the institution with which it has engaged in a
portfolio loan transaction breaches its agreement with the Fund.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 11
Stock
Index Fund
Prospectus
Registration Mark
Copy Rights 1997 Dreyfus Service Corporation
763p050197
Page 12
____________________________________________________________________________
DREYFUS STOCK INDEX FUND
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
MAY 1, 1997
____________________________________________________________________________
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus of
Dreyfus Stock Index Fund (the "Fund"), dated May 1, 1997, as it may be
revised from time to time. To obtain a copy of the Fund's Prospectus,
please write to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York
11556-0144, or call the following numbers:
Call Toll Free 1-800-645-6561
In New York City - Call 1-718-895-1206
Outside the U.S. or Canada - Call 516-794-5452
The Dreyfus Corporation ("Dreyfus") serves as the Fund's manager.
Dreyfus has engaged its affiliate, Mellon Equity Associates ("Mellon
Equity"), to serve as the Fund's index fund manager and provide day-to-day
management of the Fund's investments. Dreyfus and Mellon Equity are
referred to collectively as the "Advisers."
Premier Mutual Fund Services, Inc. (the "Distributor") serves as the
distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies B-2
Management of the Fund B-6
Management Arrangements B-11
Purchase of Shares B-14
Shareholder Services Plan B-14
Redemption of Shares B-14
Determination of Net Asset Value B-15
Dividends, Distributions and Taxes B-15
Portfolio Transactions B-17
Performance Information B-18
Information About the Fund B-18
Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Accountants B-19
Appendix B-20
Financial Statements B-21
Report of Independent Accountants B-33
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in conjunction
with the sections in the Fund's Prospectus entitled "Description of the
Fund" and "Appendix."
Portfolio Securities
Money Market Instruments. The Fund may invest, in the circumstances
described under "Description of the Fund - Management Policies" in the
Fund's Prospectus, in the following types of money market instruments.
U.S. Government Securities. Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities that differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government agencies
and instrumentalities are supported by the full faith and credit of the U.S.
Treasury; others by the right of the issuer to borrow from the Treasury;
others by discretionary authority of the U.S. Government to purchase certain
obligations from the agency or instrumentality; and others only by the
credit of the agency or instrumentality. These securities bear fixed,
floating or variable rates of interest. While the U.S. Government provides
financial support for such U.S. Government-sponsored agencies and
instrumentalities, no assurance can be given that it will always do so since
it is not so obligated by law.
Repurchase Agreements. In a repurchase agreement, the Fund buys, and the
seller agrees to repurchase, a security at a mutually agreed upon time and
price (usually within seven days). The repurchase agreement thereby
determines the yield during the purchaser's holding period, while the
seller's obligation to repurchase is secured by the value of the underlying
security. The Fund's custodian or sub-custodian will have custody of, and
will hold in a segregated account, securities acquired by the Fund under a
repurchase agreement. Repurchase agreements are considered by the staff of
the Securities and Exchange Commission to be loans by the Fund. In an
attempt to reduce the risk of incurring a loss on a repurchase agreement,
the Fund will enter into repurchase agreements only with domestic banks with
total assets in excess of $1 billion, or primary government securities
dealers reporting to the Federal Reserve Bank of New York, with respect to
securities of the type in which the Fund may invest, and will require that
additional securities be deposited with it if the value of the securities
purchased should decrease below resale price. Repurchase agreements could
involve risks in the event of a default or insolvency of the other party to
the agreement, including possible delays or restrictions upon the Fund's
ability to dispose of the underlying securities.
Bank Obligations. The Fund may purchase certificates of deposit, time
deposits, bankers' acceptances and other short-term obligations issued by
domestic banks, foreign subsidiaries or foreign branches of domestic banks,
domestic and foreign branches of foreign banks, domestic savings and loan
associations and other banking institutions. With respect to such
securities issued by foreign subsidiaries or foreign branches of domestic
banks, and domestic and foreign branches of foreign banks, the Fund may be
subject to additional investment risks that are different in some respects
from those incurred by a fund which invests only in debt obligations of U.S.
domestic issuers.
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period
of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and the drawer to pay the face
amount of the instruments upon maturity. The other short-term obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
Commercial Paper. Commercial paper consists of short-term, unsecured
promissory notes issued to finance short-term credit needs. The commercial
paper purchased by the Fund will consist only of direct obligations which,
at the time of their purchase, are (a) rated at least Prime-1 by Moody's
Investors Service, Inc. ("Moody's") or A-1 by Standard & Poor's Ratings
Group ("S&P"), (b) issued by companies having an outstanding unsecured debt
issue currently rated at least Aa by Moody's or at least AA- by S&P, or (c)
if unrated, determined by the Advisers to be of comparable quality to those
rated obligations which may be purchased by the Fund.
Management Policies
Lending Portfolio Securities. In connection with its securities
lending transactions, the Fund may return to the borrower or a third party
which is unaffiliated with the Fund, and which is acting as a "placing
broker," a part of the interest earned from the investment of collateral
received for securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value of
the securities rises above the level of such collateral; (3) the Fund must
be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any dividends, interest or other
distributions payable on the loaned securities, and any increase in market
value; (5) the Fund may pay only reasonable custodian fees in connection
with the loan; and (6) while voting rights on the loaned securities may pass
to the borrower, the Fund's Board must terminate the loan and regain the
right to vote the securities if a material event adversely affecting the
investment occurs.
Derivatives. The Fund may invest in Derivatives (as defined in the
Fund's Prospectus) in anticipation of taking a market position when, in the
opinion of the Advisers, available cash balances do not permit an
economically efficient trade in the cash market. Derivatives may provide a
cheaper, quicker or more specifically focused way for the Fund to invest
than "traditional" securities would.
Derivatives can be volatile and involve various types and degrees of
risk, depending upon the characteristics of the particular Derivative and
the portfolio as a whole. Derivatives permit the Fund to increase or
decrease the level of risk, or change the character of the risk, to which
its portfolio is exposed in much the same way as the Fund can increase or
decrease the level of risk, or change the character of the risk, of its
portfolio by making investments in specific securities.
Derivatives may entail investment exposures that are greater than their
cost would suggest, meaning that a small investment in Derivatives could
have a large potential impact on the Fund's performance.
If the Fund invests in Derivatives at inappropriate times or judges
market conditions incorrectly, such investments may lower the Fund's return
or result in a loss. The Fund also could experience losses if its
Derivatives were poorly correlated with its other investments, or if the
Fund were unable to liquidate its position because of an illiquid secondary
market. The market for many Derivatives is, or suddenly can become,
illiquid. Changes in liquidity may result in significant, rapid and
unpredictable changes in the prices for Derivatives.
Stock Index Futures. A stock index future obligates the Fund to pay or
receive an amount of cash equal to a fixed dollar amount specified in the
futures contract multiplied by the difference between the settlement price
of the contract on the contract's last trading day and the value of the
index based on the stock prices of the securities that comprise it at the
opening of trading in such securities on the next business day. The Fund
purchases and sells futures contracts on the stock index for which it can
obtain the best price with consideration also given to liquidity.
Using futures in anticipation of market transactions involves certain
risks. Although the Fund intends to purchase or sell futures contracts only
if there is an active market for such contracts, no assurance can be given
that a liquid market will exist for any particular contract at any
particular time. In addition, the price of stock index futures may not
correlate perfectly with the movement in the stock index due to certain
market distortions. First, all participants in the futures market are
subject to margin deposit and maintenance requirements. Rather than meeting
additional margin deposit requirements, investors may close futures
contracts through offsetting transactions which would distort the normal
relationship between the index and futures markets. Secondly, from the
point of view of speculators, the deposit requirements in the futures market
are less onerous than margin requirements in the securities market.
Therefore, increased participation by speculators in the futures market also
may cause temporary price distortions. Because of the possibility of price
distortions in the futures market and the imperfect correlation between
movements in the stock index and movements in the price of stock index
futures, a correct forecast of general market trends still may not result in
a successful hedging transaction.
In connection with its futures transactions, the Fund may be required
to establish and maintain at its custodian bank a segregated account
consisting of permissible liquid assets in an amount equal to the market
value of the underlying commodity less any amount deposited as margin.
Investment Restrictions
The Fund has adopted the following investment restrictions as
fundamental policies, which cannot be changed without approval of the
holders of a majority (as defined in the Investment Company Act of 1940, as
amended (the "1940 Act")) of the Fund's outstanding voting shares. The Fund
may not:
1. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessors) if such
purchase would cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.
2. Purchase securities of closed-end investment companies, except (a)
in the open market where no commission other than the ordinary broker's
commission is paid, which purchases are limited to a maximum of (i) 3% of
the total outstanding voting stock of any one closed-end investment company,
(ii) 5% of the Fund's net assets with respect to the securities issued by
any one closed-end investment company and (iii) 10% of the Fund's net assets
in the aggregate, or (b) those received as part of a merger or
consolidation. The Fund may not purchase the securities of open-end
investment companies other than itself.
3. Invest in commodities, except that the Fund may invest in futures
contracts as described in the Prospectus and Statement of Additional
Information.
4. Purchase, hold or deal in real estate, or oil and gas interests,
but the Fund may purchase and sell securities that are secured by real
estate or issued by companies that invest or deal in real estate.
5. Borrow money or pledge, mortgage or hypothecate its assets, except
as described in the Fund's Prospectus and the Statement of Additional
Information and in connection with entering into futures contracts.
Collateral arrangements with respect to initial or variation margin for
futures contracts will not be deemed to be pledges of the Fund's assets.
6. Lend any funds or other assets, except through the purchase of
debt securities, bankers' acceptances and commercial paper of corporations
and other entities. However, the Fund may lend its portfolio securities in
an amount not to exceed 30% of the value of its total assets. Any loans of
portfolio securities will be made according to guidelines established by the
Securities and Exchange Commission and the Fund's Board.
7. Act as an underwriter of securities of other issuers or purchase
securities subject to restrictions on disposition under the Securities Act
of 1933 (so-called "restricted securities"). The Fund may not enter into
repurchase agreements providing for settlement in more than seven days after
notice or purchase securities which are not readily marketable, if, in the
aggregate, more than 10% of the value of the Fund's net assets would be so
invested. The Fund will not enter into time deposits maturing in more than
seven days and time deposits maturing from two business through seven
calendar days will not exceed 10% of the Fund's total assets.
8. Invest in the securities of a company for the purpose of
exercising management or control, but the Fund will vote the securities it
owns in its portfolio as a shareholder in accordance with its views.
9. Purchase, sell or write puts, calls or combinations thereof.
10. Invest more than 25% of its assets in investments in any
particular industry or industries (including banking), except to the extent
the Index also is so concentrated, provided that, when the Fund has adopted
a temporary defensive posture, there shall be no limitation on the purchase
of obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.
In addition to the investment restrictions adopted as fundamental
policies set forth above, the Fund operates with certain non-fundamental
policies which may be changed by vote of a majority of the Board members at
any time. The Fund may not: (i) engage in arbitrage transactions,
(ii) purchase warrants (other than those acquired by the Fund in units or
attached to securities), (iii) sell securities short, but reserves the right
to sell securities short against the box, and (iv) invest more than 10% of
its total assets in the securities of any single issuer or invest in more
than 10% of the voting securities of any single issuer. In addition, the
Fund intends to: (i) comply with the diversification requirements under
Section 817(h) of the Internal Revenue Code of 1986, as amended (the
"Code"), and (ii) comply in all material respects with relevant insurance
laws and regulations applicable to investments of separate accounts of
Participating Insurance Companies.
If a percentage restriction is adhered to at the time of investment, a
later change in percentage resulting from a change in values or assets will
not constitute a violation of such restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interests of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Board members and officers of the Fund, together with information as to
their principal business occupations during at least the last five years,
are shown below. Each Board member who is deemed to be an "interested
person" of the Fund, as defined in the 1940 Act, is indicated by an
asterisk.
Board Members of the Fund
JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman of
the Board of various funds in the Dreyfus Family of Funds. He is also
Chairman of the Board of Directors of Noel Group, Inc., a venture
capital company; and a director of The Muscular Dystrophy Association,
HealthPlan Services Corporation, Belding Heminway Company, Inc., a
manufacturer and marketer of industrial threads and buttons, Curtis
Industries, Inc., a national distributor of security products,
chemicals and automotive and other hardware, and Staffing Resources,
Inc. For more than five years prior to January 1995, he was President,
a director and, until August 1994, Chief Operating Officer of Dreyfus
and Executive Vice President and a director of Dreyfus Service
Corporation, a wholly-owned subsidiary of Dreyfus and, until August 24,
1994, the Fund's distributor. From August 1994 until December 31,
1994, he was a director of Mellon Bank Corporation. He is 53 years old
and his address is 200 Park Avenue, New York, New York 10166.
*DAVID P. FELDMAN, Board Member. Corporate Vice President-Investment
Management of AT&T. He is also a trustee of Corporate Property
Investors, a real estate investment company. He is 57 years old and
his address is One Oak Way, Berkeley Heights, New Jersey 07922.
JOHN M. FRASER, JR., Board Member. President of Fraser Associates, a
service company for planning and arranging corporate meetings and other
events. From September 1975 to June 1978, he was Executive Vice
President of Flagship Cruises, Ltd. Prior thereto, he was Senior Vice
President and Resident Director of the Swedish-American Line for the
United States and Canada. He is 74 years old and his address is 133
East 64th Street, New York, New York 10021.
EHUD HOUMINER, Board Member. Since July 1991, Professor and
Executive-in-Residence at the Columbia Business School, Columbia
University. Since January 1996, principal of Lear, Yavitz and
Associates, a management consulting firm. He was President and Chief
Executive Officer of Philip Morris USA, manufacturers of consumer
products, from December 1988 to September 1990. He also is a director
of Avnet Inc. He is 55 years old and his address is c/o Columbia
Business School, Columbia University, Uris Hall, Room 526, New York,
New York 10027.
DAVID J. MAHONEY, Board Member. President of David Mahoney Ventures since
1983. From 1968 to 1983, he was Chairman and Chief Executive Officer
of Norton Simon Inc., a producer of consumer products and services.
Mr. Mahoney is also a director of National Health Laboratories Inc.,
Bionaire Inc. and Good Samaritan Health Systems, Inc. He is 72 years
old and his address is 745 Fifth Avenue, Suite 700, New York, New York
10151.
GLORIA MESSINGER, Board Member. Attorney with Dornbush, Mensch, Mandelstam
and Schaeffer. From 1981 to 1993, Managing Director and Chief
Executive Officer of ASCAP (American Society of Composers, Authors and
Publishers). She is a member of the Board of Directors of the Yale Law
School Fund and Theater for a New Audience, Inc., and was Secretary of
the ASCAP Foundation and served as a trustee of the Copyright Society
of the United States. She is also a member of numerous professional
and civic organizations. She is 66 years old and her address is 747
Third Avenue, 11th Floor, New York, New York 10017.
JACK R. MEYER, Board Member. President and Chief Executive Officer of
Harvard Management Company, an investment management company, since
September 1990. For more than five years prior thereto, he was
Treasurer and Chief Investment Officer of The Rockefeller Foundation.
He is 51 years old and his address is 600 Atlantic Avenue, Boston,
Massachusetts 02210.
JOHN SZARKOWSKI, Board Member. Director Emeritus of Photography at The
Museum of Modern Art. Consultant in Photography. He is 71 years old
and his address is Bristol Road, Box 221, East Chatham, New York 12060.
ANNE WEXLER, Board Member. Chairman of the Wexler Group, consultants
specializing in government relations and public affairs. She is also a
director of Alumax, Comcast Corporation, The New England Electric
System, and Nova Corporation, and a member of the Board of the Carter
Center of Emory University, the Council of Foreign Relations, the
National Park Foundation, Visiting Committee of the John F. Kennedy
School of Government at Harvard University and the Board of Visitors of
the University of Maryland School of Public Affairs. She is 66 years
old and her address is c/o The Wexler Group, 1317 F Street, N.W., Suite
600, Washington, D.C. 20004.
For so long as the Fund's plan described in the section captioned
"Shareholder Services Plan" remains in effect, the Board members of the Fund
who are not "interested persons" of the Fund, as defined in the 1940 Act,
will be selected and nominated by the Board members who are not "interested
persons" of the Fund.
The Fund typically pays its Board members an annual retainer and a per
meeting fee and reimburses them for their expenses. The Chairman of the
Board receives an additional 25% of such compensation. Emeritus Board
members are entitled to receive an annual retainer and a per meeting fee of
one-half the amount paid to them as Board members. The aggregate amount of
compensation paid to each Board members by the Fund and by all other funds
in the Dreyfus Family of Funds for which such person is a Board member (the
number of which is set forth in parenthesis next to each Board member's
total compensation) for the fiscal year ended December 31, 1996, were as
follows:
Aggregate Total
Compensation From Compensation
Name of Board Fund* From Fund and
Member Fund Complex
Paid to Board
Member
Joseph S. DiMartino $6,250 $517,075 (94)
David P. Feldman $5,000 $122,257 (27)
John M. Fraser, Jr.** $2,589 $ 73,563 (12)
Ehud Houminer** $2,089 $ 48,769 (11)
David J. Mahoney** $1,589 $ 40,312 (14)
Gloria Messinger** $2,589 $ 11,444 (4)
Jack R. Meyer $5,000 $ 18,868 (4)
John Szarkowski $5,000 $ 21,377 (4)
Anne Wexler $5,000 $ 62,034 (16)
____________________________
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $2,547 for all Board members as a group.
** Elected to the Board by a vote of stockholders on July 26, 1996.
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President, Chief Executive
Officer and a director of the Distributor and an officer of other
investment companies advised or administered by Dreyfus. From December
1991 to July 1994, she was President and Chief Compliance Officer of
Funds Distributor, Inc., the ultimate parent of which is Boston
Institutional Group, Inc. She is 39 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President,
General Counsel, Secretary and Clerk of the Distributor and an officer
of other investment companies advised or administered by Dreyfus. From
February 1992 to July 1994, he served as Counsel for The Boston Company
Advisors, Inc. He is 32 years old.
ELIZABETH A. KEELEY, Vice President and Assistant Secretary. Assistant Vice
President of the Distributor and an officer of other investment
companies advised or administered by Dreyfus. She is 27 years old.
DOUGLAS C. CONROY, Vice President and Assistant Secretary. Supervisor of
Treasury Services and Administration of Funds Distributor, Inc. and an
officer of other investment companies advised or administered by
Dreyfus. From April 1993 to January 1995, he was a Senior Fund
Accountant for Investors Bank and Trust Company. From December 1991 to
March 1993, he was employed as a Fund Accountant at The Boston Company,
Inc. He is 27 years old.
RICHARD W. INGRAM, Vice President and Assistant Secretary. Senior Vice
President and Director of Client Services and Treasury Operations of
Funds Distributor, Inc. and an officer of other investment companies
advised or administered by Dreyfus. From March 1994 to November 1995,
he was Vice President and Division Manager for First Data Investor
Services Group. From 1989 to 1994, he was Vice President, Assistant
Treasurer and Tax Director - Mutual Funds of The Boston Company, Inc.
He is 40 years old.
MARK A. KARPE, Vice President and Assistant Secretary. Senior Paralegal of
the Distributor and an officer of other investment companies advised or
administered by Dreyfus. Prior to August 1993, he was employed as an
Associate Examiner at the National Association of Securities Dealers,
Inc. He is 27 years old.
MARY A. NELSON, Vice President and Assistant Treasurer. Vice President and
Manager of Treasury Services and Administration of Funds Distributor,
Inc. and an officer of other investment companies advised or
administered by Dreyfus. From September 1989 to July 1994, she was an
Assistant Vice President and Client Manager for The Boston Company,
Inc. She is 32 years old.
JOSEPH F. TOWER, III, Vice President and Assistant Treasurer. Senior Vice
President, Treasurer and Chief Financial Officer of the Distributor and
an officer of other investment companies advised or administered by
Dreyfus. From July 1988 to August 1994, he was employed by The Boston
Company, Inc. where he held various management positions in the
Corporate Finance and Treasury areas. He is 34 years old.
MICHAEL S. PETRUCELLI, Vice President and Assistant Treasurer. Director of
Strategic Client Initiatives for Funds Distributor, Inc. and an officer
of other investment companies advised or administered by Dreyfus. From
December 1989 through November 1996, he was employed with GE
Investments where he held various financial, business development and
compliance positions. He is 35 years old.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
The Fund's Board members and officers, as a group, owned less than 1%
of the Fund's shares outstanding on April 2, 1997.
The following persons are known by the Fund to own of record 5% or more
of the Fund's voting securities outstanding on April 2, 1997. Nationwide
Variable Account II, P.O. Box 182029, Columbus, Ohio 43218--57.4%; Travelers
Fund U, One Tower Square, Hartford, Connecticut 06183--15% and Transamerica
Occidental Life Insurance Company Separate Account VA-2L, P.O. Box 33849,
Charlotte, North Carolina 28233--6.5%. A shareholder that owns, directly or
indirectly, 25% or more of the Fund's voting securities may be deemed to be
a "control person" (as defined in the 1940 Act) of the Fund.
MANAGEMENT ARRANGEMENTS
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "Management of the Fund."
Management Agreement. Dreyfus provides management services pursuant to
the Management Agreement (the "Management Agreement") dated November 13,
1995, with the Fund, which is subject (after May 14, 1997) to annual
approval by (i) the Fund's Board or (ii) vote of a majority (as defined in
the 1940 Act) of the outstanding voting securities of the Fund, provided
that in either event the continuance also is approved by a majority of the
Board members who are not "interested persons" (as defined in the 1940 Act)
of the Fund or Dreyfus by vote cast in person at a meeting called for the
purpose of voting on such approval. The Management Agreement was approved
by shareholders on November 3, 1995 and was last approved by the Fund's
Board, including a majority of the Board members who are not "interested
persons" (as defined in the 1940 Act) of any party to the Management
Agreement, at a meeting held on August 9, 1995. The Management Agreement is
terminable without penalty, on 60 days' notice, by the Fund's Board or by
vote of the holders of a majority of the Fund's shares, or, upon not less
than 90 days' notice, by Dreyfus. The Management Agreement will terminate
automatically in the event of its assignment (as defined in the 1940 Act).
The following persons are officers and/or directors of Dreyfus: W.
Keith Smith, Chairman of the Board; Christopher M. Condron, President, Chief
Executive Officer, Chief Operating Officer and a director; Stephen E.
Canter, Vice Chairman, Chief Investment Officer and a director; Lawrence S.
Kash, Vice Chairman-Distribution and a director; William T. Sandalls, Jr.,
Senior Vice President and Chief Financial Officer; Mark N. Jacobs, Vice
President, General Counsel and Secretary; Patrice M. Kozlowski, Vice
President-Corporate Communications; Mary Beth Leibig, Vice President-Human
Resources; Jeffrey N. Nachman, Vice President-Mutual Fund Accounting; Andrew
S. Wasser, Vice President-Information Systems; Elvira Oslapas, Assistant
Secretary; and Mandell L. Berman, Burton C. Borgelt and Frank V. Cahouet,
directors.
Dreyfus maintains office facilities on behalf of the Fund, and
furnishes the Fund statistical and research data, clerical help, accounting,
data processing, bookkeeping and internal auditing and certain other
required services to the Fund. Dreyfus also may make such advertising and
promotional expenditures, using its own resources, as it from time to time
deems appropriate.
Index Management Agreement. Mellon Equity provides investment advisory
assistance and day-to-day management of the Fund's investments pursuant to
the Index Management Agreement (the "Index Management Agreement") dated
November 13, 1995 between Mellon Equity and Dreyfus. The Index Management
Agreement is subject (after May 14, 1997) to annual approval by (i) the
Fund's Board or (ii) vote of a majority (as defined in the 1940 Act) of the
Fund's outstanding voting securities, provided that in either event the
continuance also is approved by a majority of the Fund's Board members who
are not "interested persons" (as defined in the 1940 Act) of the Fund or
Mellon Equity, by vote cast in person at a meeting called for the purpose of
voting on such approval. The Index Management Agreement was approved by
shareholders on November 3, 1995, and was approved by the Fund's Board,
including a majority of Board members who are not "interested persons" of
any party to the Index Management Agreement, at a meeting held on August 9,
1995. The Index Management Agreement is terminable without penalty (i) by
Dreyfus on 60 days' notice, (ii) by the Fund's Board or by vote of the
holders of a majority of the Fund's shares on 60 days' notice, or (iii) by
Mellon Equity on not less than 90 days' notice. The Index Management
Agreement will terminate automatically in the event of its assignment (as
defined in the 1940 Act) or upon the termination of the Management Agreement
for any reason.
The following persons are executive officers and/or directors of Mellon
Equity: Phillip R. Roberts, Chairman of the Board; William P. Rydell,
President and Chief Executive Officer; and W. Keith Smith, Director.
Mellon Equity provides day-to-day management of the Fund's investments
in accordance with the stated policies of the Fund, subject to the
supervision of Dreyfus and approval of the Fund's Board. All purchases and
sales are reported for the Board's review at the meeting subsequent to such
transactions. Mellon Equity has agreed to pay for the custody services
provided to the Fund by Boston Safe Deposit and Trust Company.
Expenses. All expenses incurred in the operation of the Fund are borne
by the Fund, except to the extent specifically assumed by Dreyfus and/or
Mellon Equity. The expenses borne by the Fund include: organizational
costs, taxes, interest, loan commitment fees, interest and distributions
paid on securities sold short, brokerage fees and commissions, if any, fees
of Board members who are not officers, directors, employees or holders of 5%
or more of the outstanding voting securities of Dreyfus or Mellon Equity or
any of their affiliates, Securities and Exchange Commission fees, state Blue
Sky qualification fees, advisory fees, transfer and dividend disbursing
agents' fees, certain insurance premiums, industry association fees, outside
auditing and legal expenses, costs of independent pricing services, costs of
maintaining the Fund's existence, costs attributable to investor services
(including, without limitation, telephone and personnel expenses), costs of
preparing and printing prospectuses and statements of additional information
for regulatory purposes and for distribution to existing shareholders, costs
of shareholder's reports and meetings, and any extraordinary expenses.
As compensation for Dreyfus' services, the Fund has agreed to pay
Dreyfus a monthly fee at the annual rate of .245 of 1% of the value of the
Fund's average daily net assets. As compensation for Mellon Equity's
services, Dreyfus has agreed to pay Mellon Equity a monthly fee at the
annual rate of .095 of 1% of the value of the Fund's average daily net
assets. All fees and expenses are accrued daily and deducted before
declaration of dividends to shareholders. For the period November 13, 1995
(effective date of the Management Agreement and Index Management Agreement)
through December 31, 1995 and for the fiscal year ended December 31, 1996,
the Fund paid Dreyfus management fees of $94,372 and $1,278,312,
respectively, and Dreyfus paid Mellon Equity index management fees of
$36,593 and $498,160, respectively.
From April 4, 1990 to November 13, 1995, Wells Fargo Nikko Investment
Advisers ("WFNIA") served as the Fund's index fund manager. Pursuant to
prior index management agreements with WFNIA, the Fund agreed to pay a
monthly fee at the annual rate of .15 of 1% of the value of the Fund's
average daily net assets. For the fiscal year ended December 31, 1994 and
for the period January 1, 1995 through November 12, 1995 (termination date
of the prior index management agreement), the index management fees payable
to WFNIA amounted to $116,361 and $223,935, respectively, which fees were
reduced by $63,576 and $28,973, respectively, pursuant to undertakings by
WFNIA, resulting in net fees being paid to WFNIA of $52,785 in fiscal 1994
and $194,962 in fiscal 1995.
Prior to November 13, 1995, Dreyfus served as the Fund's administrator
pursuant to an administration agreement with the Fund. As compensation for
its administrative services, the Fund agreed to pay Dreyfus a monthly fee at
the annual rate of .15 of 1% of the value of the Fund's average daily net
assets. For the fiscal year ended December 31, 1994 and for the period
January 1, 1995 through November 12, 1995 (termination date of the prior
administration agreement), the administration fees payable to Dreyfus
amounted to $116,361 and $223,934 respectively, which amounts were reduced
by $63,577 and $28,972, respectively pursuant to undertakings by Dreyfus,
resulting in net fees being paid to Dreyfus of $52,784 in fiscal 1994 and
$194,962 in fiscal 1995.
Dreyfus (and to a limited extent, Mellon Equity) have agreed that if in
any fiscal year the aggregate expenses of the Fund (including fees pursuant
to the Management Agreement, but excluding taxes, brokerage, interest on
borrowings and, with the prior written consent of the necessary state
securities commissions, extraordinary expenses) exceed the expense
limitation of any state having jurisdiction over the Fund, the Fund may
deduct from the fees to be paid to Dreyfus, and Dreyfus may deduct from the
fees paid to Mellon Equity or Dreyfus and Mellon Equity will bear, such
excess expense in proportion to their management fee and index management
fee, to the extent required by state law. Such deduction or payment, if
any, will be estimated daily and reconciled and effected or paid, as the
case may be, on a monthly basis.
The aggregate fees payable to Dreyfus and Mellon Equity is not subject
to reduction as the value of the Fund's net assets increases.
PURCHASE OF SHARES
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "How to Buy Shares."
The Distributor. The Distributor serves as the Fund's distributor on a
best efforts basis pursuant to an agreement which is renewable annually.
The Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies.
SHAREHOLDER SERVICES PLAN
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "Shareholder Services
Plan."
The Fund has adopted a Shareholder Services Plan (the "Plan") pursuant
to which the Fund reimburses Dreyfus Service Corporation for certain
allocated expenses with respect to servicing and/or maintaining shareholder
accounts.
A quarterly report of the amounts expended under the Plan, and the
purposes for which such expenditures were incurred, must be made to the
Fund's Board for its review. In addition, the Plan provides that material
amendments of the Plan must be approved by the Board and by the Board
members who are not "interested persons" (as defined in the 1940 Act) of the
Fund and have no direct or indirect financial interest in the operation of
the Plan, by vote cast in person at a meeting called for the purpose of
considering such amendments. The Plan is subject to annual approval by such
vote of the Board members cast in person at a meeting called for the purpose
of voting on the Plan. The Plan is terminable at any time by vote of a
majority of the Board members who are not "interested persons" (as defined
in the 1940 Act) of the Fund and have no direct or indirect financial
interest in the operation of the Plan.
For the fiscal year ended December 31, 1996, $9,218 was charged to the
Fund under the Plan.
REDEMPTION OF SHARES
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "How to Redeem Shares."
Redemption Commitment. The Fund has committed to pay in cash all
redemption requests by any shareholder of record, limited in amount during
any 90-day period to the lesser of $250,000 or 1% of the value of the Fund's
net assets at the beginning of such period. Such commitment is irrevocable
without the prior approval of the Securities and Exchange Commission. In
the case of requests for redemption in excess of such amount, the Fund's
Board reserves the right to make payments in whole or part in securities or
other assets of the Fund in case of an emergency or any time a cash
distribution would impair the liquidity of the Fund to the detriment of the
existing shareholders. In such event, the securities would be valued in the
same manner as the Fund's portfolio is valued. If the recipient sold such
securities, brokerage charges would be incurred.
Suspension of Redemptions. The right of redemption may be suspended or
the date of payment postponed (a) during any period when the New York Stock
Exchange is closed (other than customary weekend and holiday closings), (b)
when trading in the markets the Fund ordinarily utilizes is restricted, or
when an emergency exists as determined by the Securities and Exchange
Commission so that disposal of the Fund's investments or determination of
its net asset value is not reasonably practicable or (c) for such other
periods as the Securities and Exchange Commission by order may permit to
protect the Fund's shareholders.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "How to Buy Shares."
Valuation of Portfolio Securities. The Fund's portfolio securities are
valued at the last sale price on the securities exchange or national
securities market on which such securities are primarily traded. Securities
not listed on an exchange or national securities market, or securities in
which there were no transactions, are valued at the average of the most
recent bid and asked prices. Bid price is used when no asked price is
available. Any securities or other assets for which recent market
quotations are not readily available are valued at fair value as determined
in good faith by the Fund's Board. Expenses and fees, including the index
management and administration fees (reduced by the expense limitation, if
any), are accrued daily and taken into account for the purpose of
determining the net asset value of Fund shares.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "Dividends, Distributions
and Taxes."
Taxation of the Fund. Management of the Fund believes that the Fund
qualified for the fiscal year ended December 31, 1996 as a "regulated
investment company" under the Code. The Fund intends to continue to so
qualify so long as such qualification is in the best interests of its
shareholders. Qualification as a regulated investment company relieves the
Fund from any liability for Federal income taxes to the extent its earnings
are distributed in accordance with the applicable provisions of the Code.
Among the requirements for such qualification is that less than 30% of the
Fund's gross income must be derived from the gain on the sale or other
disposition of securities held for less than three months. The term
"regulated investment company" does not imply the supervision of management
or investment practices or policies by any government agency.
If, however, the Fund does not qualify as a "regulated investment
company," it would be subject to the general rules governing the Federal
income taxation of corporations under the Code. As such, the Fund's taxable
income could be subject to a maximum tax rate of 35% thereby reducing the
amount of cash available for distribution to shareholders. Moreover,
distributions to shareholders would not be deductible in computing the
Fund's taxable income. Shareholders in receipt of distributions from the
Fund generally would be required to treat such amounts as ordinary dividend
income to the extent attributable to each such shareholder's share of the
Fund's current and accumulated earnings and profits. Amounts received in
excess of the Fund's current and accumulated earnings and profits would
constitute a return of capital to the extent of the shareholder's basis in
Fund shares. Any excess received over basis would constitute capital gain.
Certain corporate shareholders would be entitled to a dividends received
deduction under Section 243 of the Code to the extent amounts distributed
from the Fund constituted ordinary dividend income.
Section 817(h) of the Code requires that the investments of a
segregated asset account of an insurance company be "adequately diversified"
as provided therein or in accordance with U.S. Treasury Regulations in order
for the account to serve as the basis for VA contracts or VLI policies. The
Fund intends to comply with the applicable requirements so that the Fund's
investments are "adequately diversified" for this purpose. Upon
satisfaction of these requirements, shares of the Fund owned by a segregated
asset account of a Participating Insurance Company will be treated as
multiple investments.
If, however, the Fund were not to satisfy these conditions, a
segregated asset account of a Participating Insurance Company owning
shares of the Fund would be required to treat such shares as a single
investment asset (and, accordingly, would not be able to treat its
proportionate interest in the Fund's assets as being directly owned) for
purposes of determining whether the segregated asset account is
"adequately diversified" within the meaning of Section 817(h) of the Code.
This, in turn, would make it more difficult for any such segregated asset
account to satisfy the diversification standards of the Code. If a
segregated asset account is not adequately diversified, it may not serve as
the basis for VA contracts or VLI policies.
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. In addition, all or a portion of the
gain realized from engaging in "conversion transactions" may be treated as
ordinary income under Section 1258. "Conversion transactions" are defined
to include certain forward, futures, option and "straddle" transactions,
transactions marketed or sold to produce capital gains, or transactions
described in Treasury regulations to be issued in the future.
Under Section 1256 of the Code, gain or loss realized by the Fund from
certain financial futures transactions will be treated as 60% long-term
capital gain or loss and 40% short-term capital gain or loss. Gain or loss
will arise upon the exercise or lapse of such futures as well as from
closing transactions. In addition, any such futures remaining unexercised
at the end of the Fund's taxable year will be treated as sold for their then
fair market value, resulting in additional gain or loss to the Fund
characterized in the manner described above.
Offsetting positions held by the Fund involving futures may constitute
"straddles." Straddles are defined to include "offsetting positions" in
actively traded personal property. The tax treatment of straddles is
governed by Sections 1092 and 1258 of the Code, which, in certain
circumstances, overrides or modifies the provisions of Section 1256. As
such, all or a portion of any short-or long-term capital gain from certain
"straddle" and/or conversion transactions may be recharacterized to ordinary
income.
If a Fund were treated as entering into straddles by reason of its
futures transactions, such straddles could be characterized as "mixed
straddles" if the futures transactions comprising such straddles were
governed by Section 1256 of the Code. The Fund may make one or more
elections with respect to "mixed straddles." Depending upon which election
is made, if any, the results to the Fund may differ. If no election is
made, to the extent the straddle rules apply to positions established by the
Fund, losses realized by the Fund will be deferred to the extent of
unrealized gain in any offsetting positions. Moreover, as a result of the
straddle and the conversion transaction rules, short-term capital loss on
straddle positions may be recharacterized as long-term capital loss, and
long-term capital gain may be recharacterized as short-term capital gain or
ordinary income.
Shareholder Taxation. Since the shareholders of the Fund are the
separate accounts of Participating Insurance Companies, no discussion is
included herein as to the Federal income tax consequences at the level of
the holders of the VA contracts or VLI policies. For information concerning
the Federal income tax consequences to such holders, see the prospectuses
for such VA contracts or VLI policies.
PORTFOLIO TRANSACTIONS
The Advisers assume general supervision over placing orders on behalf
of the Fund for the purchase or sale of portfolio securities. Allocation of
brokerage transactions, including their frequency, is made in the best
judgment of the Advisers and in a manner deemed fair and reasonable to
shareholders. The primary consideration is prompt execution of orders at
the most favorable net price. Brokers also are selected because of their
ability to handle special executions such as are involved in large block
trades or broad distributions, provided the primary consideration is met.
Portfolio turnover may vary from year to year, as well as within a year.
High turnover rates are likely to result in comparatively greater brokerage
expenses. The overall reasonableness of brokerage commissions paid is
evaluated by the Advisers based upon their knowledge of available
information as to the general level of commissions paid by other
institutional investors for comparable services.
For its portfolio securities transactions for the fiscal years ended
December 31, 1994, 1995 and 1996, the Fund paid total brokerage commissions
of $36,780, $43,661 and $116,347, respectively, none of which was paid to
the Distributor. No spreads or concessions were paid by the Fund for such
fiscal years.
PERFORMANCE INFORMATION
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "Performance
Information."
The Fund's average annual total return for the 1, 5 and 7.258 year
periods ended December 31, 1996 was 22.54%, 14.64% and 13.69%, respectively.
Average annual total return is calculated by determining the ending
redeemable value of an investment purchased with a hypothetical $1,000
payment made at the beginning of the period (assuming the reinvestment of
dividends and distributions), dividing by the amount of the initial
investment, taking the "n"th root of the quotient (where "n" is the number
of years in the period) and subtracting 1 from the result.
The Fund's total return for the period September 29, 1989 (commencement
of operations) through December 31, 1996 was 153.50%. Total return is
calculated by subtracting the amount of the Fund's net asset value per share
at the beginning of a stated period from the net asset value per share at
the end of the period (after giving effect to the reinvestment of dividends
and distributions during the period), and dividing the result by the net
asset value per share at the beginning of the period.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in conjunction
with the section in the Fund's Prospectus entitled "General Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and non-assessable.
Fund shares are of one class and have equal rights as to dividends and in
liquidation. Shares have no preemptive, subscription or conversion rights
and are freely transferable.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
Effective May 1, 1994, the Fund, which is incorporated under the name
Dreyfus Life and Annuity Index Fund, Inc., began operating under the name
Dreyfus Stock Index Fund.
TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN, COUNSEL
AND INDEPENDENT ACCOUNTANTS
Dreyfus Transfer, Inc., a wholly-owned subsidiary of Dreyfus, P.O. Box
9671, Providence, Rhode Island 02940-9671, is the Fund's transfer and
dividend disbursing agent. Under a transfer agency agreement with the Fund,
the Transfer Agent arranges for the maintenance of shareholder account
records for the Fund, the handling of certain communications between
shareholders and the Fund and the payment of dividends and distributions
payable by the Fund. For these services, the Transfer Agent receives a
monthly fee computed on the basis of the number of shareholder accounts it
maintains for the Fund during the month, and is reimbursed for certain out-
of-pocket expenses. For the fiscal year ended December 31, 1996, the Fund
paid the Transfer Agent $362.
Boston Safe Deposit and Trust Company (the "Custodian"), an indirect
subsidiary of Mellon Bank Corporation, is located at One Boston Place,
Boston, Massachusetts 02108, and serves as the custodian of the Fund. Under
its Custody Agreement with the Fund, the Custodian holds the Fund's
portfolio securities and keeps all necessary accounts and records. The
Custodian's fees for its services to the Fund are paid by Mellon Equity.
Neither the Transfer Agent nor the Custodian has any part in
determining the investment policies of the Fund or which securities are to
be purchased or sold by the Fund.
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New York
10038-4982, as counsel for the Fund, has rendered its opinion as to certain
legal matters regarding the due authorization and valid issuance of the
shares of being sold pursuant to the Fund's Prospectus.
Coopers & Lybrand L.L.P., 1301 Avenue of the Americas, New York, New
York 10019-6013, independent accountants, have been selected as auditors of
the Fund.
APPENDIX
Description of S&P A-1 Commercial Paper Rating:
The rating A is the highest rating and is assigned by S&P to issues
that are regarded as having the greatest capacity for timely payment.
Issues in this category are delineated with the number 1, 2 or 3 to indicate
the relative degree of safety. Paper rated A-1 indicates that the degree of
safety regarding timely payment is either overwhelming or very strong.
Those issues determined to possess overwhelming safety characteristics are
denoted with a plus (+) sign designation.
Description of Moody's Prime-1 Commercial Paper Rating:
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity for
repayment of short-term promissory obligations, and ordinarily will be
evidenced by 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.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments December 31, 1996
Shares COMMON STOCKS--91.6% Value
---------- ------------
Basic Industries--5.2%
14,700 Air Products & Chemicals... $ 1,016,137
17,200 Alco Standard.............. 887,950
5,400 Armstrong World Industries. 375,300
13,800 Avery Dennison............. 488,175
4,000 Ball....................... 104,000
6,900 Bemis...................... 254,437
6,400 Boise Cascade.............. 203,200
3,700 Centex..................... 139,212
12,500 Champion International..... 540,625
16,900 Crown Cork & Seal.......... 918,937
32,000 Dow Chemical............... 2,508,000
74,100 duPont (E.I.) de Nemours... 6,993,187
10,300 Eastman Chemical........... 569,075
4,900 (a)FMC........................ 343,612
11,000 Fluor...................... 690,250
12,000 Georgia Pacific............ 864,000
7,100 Goodrich (B.F.)............ 287,550
11,700 Grace (W.R.)............... 605,475
8,300 Great Lakes Chemical....... 388,025
13,500 Hercules................... 583,875
39,600 International Paper........ 1,598,850
11,300 James River................ 374,312
37,200 Kimberly-Clark............. 3,543,300
14,300 Louisiana Pacific.......... 302,087
6,900 Mead....................... 401,062
55,000 Minnesota Mining &
Manufacturing............ 4,558,125
77,344 Monsanto................... 3,006,748
18,700 Morton International....... 762,025
8,900 Nalco Chemical............. 321,512
43,300 Occidental Petroleum....... 1,012,137
24,200 PPG Industries............. 1,358,225
3,700 Potlach.................... 159,100
20,600 Praxair.................... 950,175
8,400 Rohm & Haas................ 685,650
11,300 Sherwin-Williams........... 632,800
6,600 Sigma-Aldrich.............. 412,087
13,000 Stone Container............ 193,375
7,300 Temple-Inland.............. 395,112
9,200 Union Camp................. 439,300
16,800 Union Carbide.............. 686,700
13,400 Westvaco................... 385,250
26,100 Weyerhaeuser............... 1,236,487
7,300 Willamette Industries...... 508,262
-------------
42,683,703
-------------
Capital Goods--21.3%
28,900 AMP........................ 1,109,037
18,000 (a)Advanced Micro Devices..... 463,500
5,900 Alexander & Alexander Services 102,512
22,932 Allegheny Teledyne......... 527,436
Capital Goods (continued)
37,200 AlliedSignal............... $ 2,492,400
16,000 (a)Amdahl..................... 194,000
22,400 American Brands............ 1,111,600
8,000 (a)Andrew..................... 424,500
16,400 Apple Computer............. 342,350
23,700 (a)Applied Materials.......... 851,718
6,000 Autodesk................... 168,000
38,200 Automatic Data Processing.. 1,637,825
25,500 (a)Bay Networks............... 532,312
48,397 Boeing..................... 5,148,230
3,800 Briggs & Stratton.......... 167,200
28,000 Browning-Ferris Industries. 735,000
35,600 (a)COMPAQ Computer............ 2,643,300
51,850 (a)CUC International.......... 1,231,437
20,500 (a)Cabletron Systems.......... 681,625
9,700 Case....................... 528,650
25,200 Caterpillar................ 1,896,300
9,100 (a)Ceridian................... 368,550
5,200 Cincinnati Milacron........ 113,750
85,400 (a)Cisco Systems.............. 5,433,575
22,500 Cognizant.................. 742,500
47,950 Computer Associates
International............ 2,385,512
10,000 (a)Computer Sciences.......... 821,250
14,200 Cooper Industries.......... 598,175
6,050 Crane...................... 175,450
5,200 Cummins Engine............. 239,200
15,400 (a)DSC Communications......... 275,275
5,100 (a)Data General............... 73,950
34,000 Deere...................... 1,381,250
23,700 (a)Dell Computer.............. 1,259,062
10,900 Deluxe..................... 356,975
20,400 (a)Digital Equipment.......... 742,050
14,800 Dover...................... 743,700
12,700 Dow Jones & Co............. 430,212
23,100 Dresser Industries......... 716,100
22,400 Dun & Bradstreet........... 532,000
6,200 EG&G....................... 124,775
30,600 EMC........................ 1,013,625
10,200 Eaton...................... 711,450
29,500 Emerson Electric........... 2,854,125
58,900 First Data................. 2,149,850
5,300 Foster Wheeler............. 196,762
8,300 General Dynamics........... 585,150
216,700 General Electric........... 21,426,285
6,600 General Signal............. 282,150
15,900 Genuine Parts.............. 707,550
4,300 Giddings & Lewis........... 55,362
7,000 Grainger (W.W.)............ 561,750
13,700 H&R Block.................. 397,300
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1996
Shares COMMON STOCKS (continued) Value
---------- ------------
Capital Goods (continued)
6,500 Harnischfeger Industries... $ 312,812
5,100 Harris..................... 349,987
133,900 Hewlett-Packard............ 6,728,475
16,700 Honeywell.................. 1,098,025
16,300 Illinois Tool Works........ 1,301,962
14,400 Ingersoll-Rand............. 640,800
68,200 International Business
Machines................. 10,298,200
108,000 Intel...................... 14,141,250
6,300 (a)Intergraph................. 64,575
10,700 Interpublic Group Cos...... 508,250
5,400 Johnson Controls........... 447,525
17,000 (a)LSI Logic.................. 454,750
41,300 Laidlaw, Cl. B............. 474,950
25,400 Lockheed Martin............ 2,324,100
83,898 Lucent Technologies........ 3,880,282
9,800 Mallinckrodt Group......... 432,425
9,500 Marsh & McLennan........... 988,000
7,200 McDermott International.... 119,700
27,900 McDonnell Douglas.......... 1,785,600
27,500 Micron Technology.......... 800,937
157,300 (a)Microsoft.................. 12,996,912
78,000 Motorola................... 4,787,250
18,300 (a)National Semiconductor..... 446,062
6,200 National Service Industries 231,725
34,000 Northern Telecommunications 2,103,750
7,600 (a)Northrop Grumman........... 628,900
45,300 (a)Novell..................... 428,934
86,500 (a)Oracle..................... 3,611,375
6,800 Owens-Corning.............. 289,850
15,101 Pall....................... 385,075
9,800 Parker-Hannifin............ 379,750
5,700 Perkin-Elmer............... 335,587
19,500 Pitney Bowes............... 1,062,750
29,300 Rockwell................... 1,783,638
5,900 Raychem.................... 472,737
31,100 Raytheon................... 1,496,687
10,800 Ryder System............... 303,750
7,700 Safety-Kleen............... 126,087
10,200 Scientific-Atlanta......... 153,000
32,700 (a)Seagate Technology......... 1,291,650
31,000 Service Corp. International 868,000
3,100 Shared Medical Systems..... 152,675
23,000 (a)Silicon Graphics........... 586,500
8,050 Snap-On.................... 286,781
11,700 Stanley Works.............. 315,900
48,300 (a)Sun Microsystems........... 1,240,706
22,900 (a)3COM....................... 1,680,287
3,700 TRINOVA.................... 134,587
16,700 TRW........................ 826,650
15,600 (a)Tandem Computers........... 214,500
Capital Goods (continued)
4,300 Tektronix.................. $ 220,375
23,600 (a)Tellabs.................... 887,950
25,000 Texas Instruments.......... 1,593,750
10,900 Textron.................... 1,027,325
20,000 Thermo Electron............ 825,000
7,000 Thomas & Betts............. 310,625
4,100 Timken..................... 188,087
20,600 Tyco International......... 1,089,225
23,000 (a)Unisys..................... 155,250
31,700 United Technologies........ 2,092,200
82,500 Westinghouse Electric...... 1,639,687
63,800 WMX Technologies........... 2,081,475
42,700 Xerox...................... 2,247,087
-------------
172,576,298
-------------
Consumer Cyclical--10.8%
33,100 Albertson's................ 1,179,187
9,900 American Greetings, Cl. A.. 280,912
19,100 American Stores............ 780,712
20,000 (a)Autozone................... 550,000
16,400 Becton, Dickinson & Co..... 711,350
11,500 Black & Decker............. 346,437
12,900 Brunswick.................. 309,600
13,900 CVS........................ 575,113
13,800 (a)Charming Shoppes........... 69,862
95,900 Chrysler................... 3,164,700
12,900 Circuit City Stores........ 388,612
42,900 Comcast, Cl. A............. 764,156
10,900 Cooper Tire and Rubber..... 215,275
13,400 Dana....................... 437,175
20,700 Darden Restaurants......... 181,125
28,500 Dayton Hudson.............. 1,118,625
15,000 Dillard Department Stores, Cl. A 463,125
89,300 Disney (Walt).............. 6,217,512
19,800 Donnelley (R.R.) & Sons.... 621,225
8,200 Echlin..................... 259,325
27,300 (a)Federated Department Stores 931,612
4,600 Fleetwood Enterprises...... 126,500
4,900 Fleming Cos................ 84,525
156,100 Ford Motor................. 4,975,687
10,200 (a)Fruit of the Loom, Cl. A... 386,325
18,500 Gannett.................... 1,385,187
37,300 Gap........................ 1,123,662
18,100 (a)General Instrument......... 391,412
99,500 General Motors............. 5,547,125
7,900 Giant Food, Cl. A.......... 272,550
20,400 Goodyear Tire & Rubber..... 1,048,050
5,000 Great Atlantic & Pacific... 159,375
17,000 (a)HFS........................ 1,015,750
9,400 Harcourt General........... 433,575
4,000 Harland (John H.).......... 132,000
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1996
Shares COMMON STOCKS (continued) Value
---------- ------------
Consumer Cyclical (continued)
13,500 (a)Harrah's Entertainment..... $ 268,312
11,300 Hasbro..................... 439,287
32,600 Hilton Hotel............... 851,675
63,200 Home Depot................. 3,167,900
15,300 (a)ITT........................ 663,637
15,600 ITT Industries............. 382,200
5,100 Jostens.................... 107,737
63,700 (a)K mart..................... 660,887
4,900 (a)King World Productions..... 180,687
12,300 Knight-Ridder.............. 470,475
16,600 (a)Kroger..................... 771,900
35,700 Limited.................... 655,987
9,400 Liz Claiborne.............. 363,075
2,600 Longs Drug Stores.......... 127,725
22,800 Lowes...................... 809,400
16,900 Marriott International..... 933,725
21,100 Masco...................... 759,600
35,800 Mattel..................... 993,450
33,100 May Department Stores...... 1,547,425
13,200 Maytag..................... 260,700
91,800 McDonald's................. 4,153,950
13,100 McGraw-Hill Cos............ 604,237
4,800 Mercantile Stores.......... 237,000
3,600 Meredith................... 189,900
13,100 Moore...................... 266,912
1,133 NACCO Industries, Cl. A.... 60,615
37,900 NIKE, Cl. B................ 2,264,525
9,700 (a)Navistar International..... 88,512
12,700 New York Times, Cl. A...... 482,600
10,700 Nordstrom.................. 379,181
5,100 PACCAR..................... 346,800
30,400 Penney (J.C.).............. 1,482,000
8,200 Pep Boys-Manny, Moe & Jack. 252,150
25,800 (a)Price/Costco............... 648,225
7,300 Reebok International....... 306,600
16,200 Rite Aid................... 643,950
5,000 Russell.................... 148,750
51,500 Sears, Roebuck & Co........ 2,375,437
2,700 Springs Industries......... 116,100
6,500 Stride Rite................ 65,000
8,900 Supervalu.................. 252,537
23,600 Sysco...................... 769,950
10,300 TJX Cos.................... 487,962
7,700 Tandy...................... 338,800
87,400 (a)Tele-Communications, Cl. A. 1,141,662
74,900 Time Warner................ 2,808,750
13,000 Times Mirror, Cl. A........ 646,750
36,100 (a)Toys R Us.................. 1,083,000
8,100 Tribune.................... 638,887
82,200 (a)US West Media Group........ 1,520,700
8,400 V.F........................ 567,000
Consumer Cyclical (continued)
46,601 (a)Viacom, Cl. B.............. $ 1,625,209
301,900 Wal-Mart Stores............ 6,905,962
32,400 Walgreen................... 1,296,000
17,100 Wendy's International...... 350,550
9,800 Whirlpool.................. 456,925
19,900 Winn-Dixie Stores.......... 629,337
17,600 (a)Woolworth.................. 385,000
-------------
88,080,572
-------------
Consumer Staples--12.0%
3,700 Alberto-Culver, Cl. B...... 177,600
65,700 Anheuser-Busch Cos......... 2,628,000
71,551 Archer Daniels Midland..... 1,574,122
17,500 Avon Products.............. 999,687
9,100 Brown-Forman, Cl. B........ 416,325
18,900 CPC International.......... 1,464,750
30,800 Campbell Soup.............. 2,471,700
6,800 Clorox..................... 682,550
327,500 Coca-Cola.................. 17,234,687
19,300 Colgate-Palmolive.......... 1,780,425
31,700 ConAgra.................... 1,577,075
5,000 Coors (Adolph), Cl. B...... 95,000
43,900 Eastman Kodak.............. 3,522,975
8,500 Ecolab..................... 319,812
20,600 General Mills.............. 1,305,525
73,500 Gillette................... 5,714,625
48,400 Heinz (H.J.)............... 1,730,300
20,200 Hershey Foods.............. 883,750
14,600 International Flavors &
Fragrances............... 657,000
175,300 Johnson & Johnson.......... 8,721,175
27,700 Kellogg.................... 1,817,812
8,300 Manor Care................. 224,100
20,900 Newell..................... 658,350
204,500 PepsiCo.................... 5,981,625
107,200 Philip Morris Cos.......... 12,073,400
10,900 Pioneer Hi-Bred International 763,000
6,000 Polaroid................... 261,000
89,800 Procter & Gamble........... 9,653,500
17,900 Quaker Oats................ 682,437
13,900 Ralston-Ralston Purina Group 1,019,912
19,700 Rubbermaid................. 448,175
63,700 Sara Lee................... 2,372,825
49,100 Seagram.................... 1,902,625
8,200 Tupperware................. 439,725
24,500 UST........................ 793,187
21,100 Unilever, N.V.............. 3,697,775
13,600 Whitman.................... 311,100
15,300 Wrigley, (Wm) Jr........... 860,625
-------------
97,918,256
-------------
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1996
Shares COMMON STOCKS (continued) Value
---------- ------------
Energy--9.1%
12,200 Amerada Hess............... $ 706,075
65,400 Amoco...................... 5,264,700
8,500 Ashland.................... 372,937
21,200 Atlantic Richfield......... 2,809,000
19,000 Baker Hughes............... 655,500
16,400 Burlington Resources....... 826,150
85,900 Chevron.................... 5,583,500
13,800 Coastal.................... 674,475
7,300 Columbia Gas System........ 464,462
12,500 Consolidated Natural Gas... 690,625
2,700 Eastern Enterprises........ 95,512
33,500 Enron...................... 1,444,687
9,200 Enserch.................... 211,600
163,500 Exxon...................... 16,023,000
16,500 Halliburton................ 994,125
3,320 Helmerich & Payne.......... 173,055
6,400 Kerr-McGee................. 460,800
4,500 Louisiana Land & Exploration 241,312
51,900 Mobil...................... 6,344,775
6,500 Nicor...................... 232,375
18,100 Noram Energy............... 278,287
3,600 Oneok...................... 108,000
13,800 (a)Oryx Energy................ 341,550
11,100 Pacific Enterprises........ 337,162
19,900 Panenergy.................. 895,500
6,100 Pennzoil................... 344,650
4,600 Peoples Energy............. 155,825
34,600 Phillips Petroleum......... 1,531,050
11,200 (a)Rowan Cos.................. 253,400
70,500 Royal Dutch Petroleum...... 12,037,875
11,900 (a)Santa Fe Energy Resources.. 165,112
32,500 Schlumberger............... 3,245,937
11,300 Sonat...................... 581,950
21,900 Tenneco.................... 988,238
9,600 Sun........................ 234,000
34,800 Texaco..................... 3,414,750
37,900 USX-Marathon Group......... 904,862
32,944 Union Pacific Resources Group 963,614
32,900 Unocal..................... 1,336,562
7,100 (a)Western Atlas.............. 503,212
20,700 Williams Cos............... 776,250
-------------
73,666,451
-------------
Health Care-- 8.3%
102,300 Abbott Laboratories........ 5,191,725
8,600 (a)Allergan................... 306,375
11,100 Alza....................... 287,212
84,000 American Home Products..... 4,924,500
34,800 (a)Amgen...................... 1,892,250
7,500 Bard (C.R.)................ 210,000
7,300 Bausch & Lomb.............. 255,500
Health Care (continued)
35,900 Baxter International....... $ 1,471,900
13,100 (a)Beverly Enterprises........ 167,025
15,200 Biomet..................... 229,900
23,400 (a)Boston Scientific.......... 1,404,000
65,900 Bristol-Myers Squibb....... 7,166,625
88,350 Columbia/HCA Healthcare.... 3,600,262
30,300 Corning.................... 1,401,375
9,600 Guidant.................... 547,200
21,400 (a)Humana..................... 409,275
72,600 Lilly (Eli)................ 5,299,800
31,600 Medtronic.................. 2,148,800
158,600 Merck & Co................. 12,569,050
5,700 Millipore.................. 235,837
84,800 Pfizer..................... 7,027,800
66,900 Pharmacia & Upjohn......... 2,650,912
48,600 Schering-Plough............ 3,146,850
10,700 St. Jude Medical........... 456,087
28,600 (a)Tenet Healthcare........... 625,625
8,300 U.S. Surgical.............. 326,812
24,300 United Healthcare.......... 1,093,500
35,700 Warner-Lambert............. 2,677,500
-------------
67,723,697
-------------
Interest Sensitive--13.5%
19,799 Aetna...................... 1,583,920
13,900 Ahmanson (H.F.) & Co....... 451,750
58,500 Allstate................... 3,385,687
62,300 American Express........... 3,519,950
26,700 American General........... 1,091,362
61,800 American International Group 6,689,850
14,200 Aon........................ 882,175
56,200 Banc One................... 2,416,600
51,600 Bank of New York........... 1,741,500
47,300 BankAmerica................ 4,718,175
20,100 Bank of Boston............. 1,291,425
10,800 Bankers Trust New York..... 931,500
25,600 Barnett Banks.............. 1,052,800
7,100 Beneficial................. 449,962
20,300 Boatmens Bancshares........ 1,309,350
9,900 CIGNA...................... 1,352,587
57,800 Chase Manhattan............ 5,158,650
22,900 Chubb...................... 1,230,875
62,000 Citicorp................... 6,386,000
14,100 Comerica................... 738,487
29,300 CoreStates Financial....... 1,519,937
21,101 Dean Witter, Discover & Co. 1,397,941
143,700 Federal National Mortgage
Association.............. 5,352,825
23,600 Federal Home Loan Mortgage. 2,598,950
13,900 Fifth Third Bancorp........ 873,093
17,700 First Bank Systems......... 1,208,025
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1996
Shares COMMON STOCKS (continued) Value
---------- ------------
Interest Sensitive (continued)
41,900 First Chicago NBD.......... $ 2,252,125
37,400 First Union................ 2,767,600
34,500 Fleet Financial Group...... 1,720,687
10,900 General Re................. 1,719,475
7,600 Golden West Financial...... 479,750
18,200 Great Western Financial.... 527,800
18,100 Green Tree Financial....... 699,112
12,700 Household International.... 1,171,575
15,500 ITT Hartford............... 1,046,250
9,400 Jefferson Pilot............ 532,275
5,100 Kaufman & Broad Home....... 65,662
29,700 Keycorp.................... 1,499,850
13,700 Lincoln National........... 719,250
15,200 Loews...................... 1,432,600
5,700 MBIA....................... 577,125
29,300 MBNA....................... 1,215,950
7,800 MGIC Investment............ 592,800
17,100 Mellon Bank................ 1,214,100
21,700 Merrill Lynch & Co......... 1,768,550
24,600 Morgan (J.P.) & Co......... 2,401,575
20,000 Morgan Stanley Group....... 1,142,500
29,200 National City.............. 1,310,350
37,900 NationsBank................ 3,704,725
48,700 Norwest.................... 2,118,450
44,900 PNC Bank................... 1,689,362
12,300 Providian.................. 631,912
3,100 Pulte...................... 95,325
7,300 Republic New York.......... 595,862
16,600 Safeco..................... 654,662
14,300 Salomon.................... 673,887
10,900 St. Paul Cos............... 639,012
29,400 SunTrust Banks............. 1,447,950
9,300 Torchmark.................. 469,650
8,700 Transamerica............... 687,300
84,266 Travelers Group............ 3,823,600
9,700 UNUM....................... 700,825
15,200 USF&G...................... 317,300
4,500 USLife..................... 149,625
19,900 U.S. Bancorp............... 894,256
21,700 Wachovia................... 1,226,050
12,100 Wells Fargo................ 3,263,975
-------------
109,974,065
-------------
Mining and Metals--1.3%
14,000 (a)ARMCO...................... 57,750
5,600 ASARCO..................... 139,300
29,800 Alcan Aluminium............ 1,002,025
22,800 Aluminum Co. of America.... 1,453,500
47,100 Barrick Gold............... 1,354,125
29,600 Battle Mountain Gold....... 203,500
14,700 (a)Bethlehem Steel............ 132,300
Mining and Metals (continued)
12,200 Cyprus Amax Minerals....... $ 285,175
18,300 Echo Bay Mines............. 121,237
18,900 Engelhard.................. 361,462
25,500 Freeport-McMoRan
Copper, Cl. B.......... 761,812
19,300 Homestake Mining........... 275,025
22,200 Inco....................... 707,625
6,400 Inland Steel Industries.... 128,000
13,101 Newmont Mining............. 586,269
11,500 Nucor...................... 586,500
8,600 Phelps Dodge............... 580,500
31,500 Placer Dome................ 685,125
8,400 Reynolds Metals............ 473,550
17,301 Santa Fe Pacific Gold...... 266,002
11,100 USX-U.S. Steel............. 348,262
11,900 Worthington Industries..... 215,687
-------------
10,724,731
-------------
Transportation--1.3%
11,900 (a)AMR........................ 1,048,687
20,100 Burlington Northern Santa Fe 1,736,137
28,500 CSX........................ 1,204,125
5,100 Caliber System............. 98,175
10,600 Conrail.................... 1,056,025
9,900 Delta Air Lines............ 701,662
15,000 Federal Express............ 667,500
16,500 Norfolk Southern........... 1,443,750
19,100 Southwest Airlines......... 422,587
8,500 (a)USAir Group................ 198,687
32,300 Union Pacific.............. 1,942,037
-------------
10,519,372
-------------
Utilities--8.8%
25,000 ALLTEL..................... 784,375
213,300 AT&T....................... 9,278,550
66,000 (a)Airtouch Communications.... 1,666,500
24,700 American Electric Power.... 1,015,787
72,300 Ameritech.................. 4,383,187
19,400 Baltimore Gas & Electric... 518,950
57,600 Bell Atlantic.............. 3,729,600
130,800 BellSouth.................. 5,281,050
20,700 CINergy.................... 690,862
19,900 Carolina Power & Light..... 726,350
27,700 Central & Southwest........ 709,812
31,000 Consolidated Edison........ 906,750
19,100 DTE Energy................. 618,362
23,700 Dominion Resources......... 912,450
26,500 Duke Power................. 1,225,625
57,000 Edison International....... 1,132,875
30,400 Entergy.................... 843,600
24,100 FPL Group.................. 1,108,600
22,000 Frontier................... 497,750
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1996
Shares COMMON STOCKS (continued) Value
---------- ------------
Utilities (continued)
15,900 GPU........................ $ 534,637
126,600 GTE........................ 5,760,300
30,900 Houston Industries......... 699,112
90,200 MCI Communications......... 2,948,412
57,900 NYNEX...................... 2,786,437
19,000 Niagara Mohawk Power....... 187,625
9,100 Northern States Power...... 417,462
20,100 Ohio Edison................ 457,275
29,300 PECO Energy................ 739,825
21,400 PP&L Resources............. 492,200
54,300 Pacific Gas & Electric..... 1,140,300
56,400 Pacific Telesis Group...... 2,072,700
38,800 PacifiCorp................. 795,400
31,400 Public Service Enterprise Group 855,650
79,400 SBC Communications......... 4,108,950
88,700 Southern................... 2,006,837
56,600 Sprint..................... 2,256,925
29,600 Texas Utilities............ 1,206,200
28,400 UniCom..................... 770,350
13,400 Union Electric............. 515,900
62,800 US West.................... 2,025,300
114,400 (a)WorldCom................... 2,981,550
-------------
71,790,382
-------------
TOTAL COMMON STOCKS
(cost $631,260,923)...... $745,657,527
=============
U.S. Treasury Bills:
$ 979,000 4.9%, 1/2/1997........... $ 978,873
2,628,000 4.94%, 1/9/1997.......... 2,625,188
4,979,000 (b).........4.96%, 1/16/1997 4,968,744
3,041,000 4.99%, 1/23/1997......... 3,031,938
499,000 5.01%, 1/30/1997......... 497,054
3,443,000 4.98%, 2/27/1997......... 3,416,006
26,111,000 4.94%, 3/6/1997.......... 25,880,701
29,643,000 4.89%, 3/13/1997......... 29,352,795
-------------
TOTAL SHORT-TERM
(cost $70,755,963)..... $ 70,751,299
=============
TOTAL INVESTMENTS
(cost $702,016,886)............ 100.3% $816,408,826
======= =============
LIABILITIES LESS CASH AND
RECEIVABLES ................... (.3%)$ (2,450,053)
======= =============
NET ASSETS....................... 100.0% $813,958,773
======= =============
Notes to Statement of Investments:
- --------------------------------------------------------------------------------
(a) Non-income producing.
(b) Partially held by custodian in a segregated account as collateral for open
financial future positions.
Statement of Financial Futures December 31, 1996
<TABLE>
<CAPTION>
Financial Futures Purchased
- ----------------------------------------------------------------------------------------------------------------
Market Value Unrealized
Number of Covered (Depreciation)
Issuer Contracts by Contracts Expiration at 12/31/96
- ----- ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Standard & Poor's 500............................ 187 $69,610,750 March 1997 ($267,170)
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities December 31, 1996
<TABLE>
<CAPTION>
Cost Value
------------- -------------
<S> <C> <C> <C>
ASSETS: Investments in securities--See Statement of
Investments.................................... $702,016,886 $816,408,826
Cash............................................. 3,146,261
Dividends and interest receivable................ 1,074,756
Receivable for investment securities sold........ 154,980
Prepaid expenses................................. 698
-------------
820,785,521
-------------
LIABILITIES: Due to The Dreyfus Corporation and affiliates.... 170,483
Payable for investment securities purchased...... 5,081,867
Payable for futures variation margin--Note 4(a)... 1,377,500
Accrued expenses................................. 196,898
-------------
6,826,748
-------------
NET ASSETS..................................................................... $813,958,773
=============
REPRESENTED BY: Paid-in capital.................................. $675,673,544
Accumulated undistributed investment income--net.. 96,693
Accumulated net realized gain (loss) on investments 24,063,766
Accumulated net unrealized appreciation (depreciation)
on investments [including ($267,170) net unrealized
(depreciation) on financial futures]--Note 4(b). 114,124,770
-------------
NET ASSETS..................................................................... $813,958,773
=============
SHARES OUTSTANDING
(200 million shares of $.001 par value Common Stock authorized)................ 40,128,613
NET ASSET VALUE, offering and redemption price per share....................... $20.28
=======
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Operations Year Ended December 31, 1996
<TABLE>
<S> <C> <C> <C>
INVESTMENT INCOME
INCOME: Cash dividends
(net of $62,931 foreign taxes withheld at source) $ 10,395,226
Interest......................................... 2,964,524
--------------
Total Income................................ $ 13,359,750
EXPENSES: Management fee--Note 3(a)......................... 1,278,312
Registration fees................................. 125,515
Professional fees................................. 77,292
Prospectus and shareholders' reports.............. 40,817
Directors' fees and expenses--Note 3(c)........... 37,160
Shareholder servicing costs--Note 3(b)............ 6,090
Miscellaneous..................................... 6,794
--------------
Total Expenses.............................. 1,571,980
---------------
INVESTMENT INCOME--NET.......................................................... 11,787,770
---------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments--Note 4(a) $23,146,990
Net realized gain (loss) on financial futures--Note 4(a) 8,737,790
--------------
Net Realized Gain.............................. 31,884,780
Net unrealized appreciation (depreciation) on investments
[including ($32,355) net unrealized (depreciation) on
financial futures]............................. 67,782,146
---------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS......................... 99,666,926
---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.......................... $111,454,696
===============
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, 1996 December 31, 1995
----------------- -----------------
<S> <C> <C>
OPERATIONS:
Investment income--net................................................ $ 11,787,770 $ 4,465,773
Net realized gain (loss) on investments.............................. 31,884,780 8,075,002
Net unrealized appreciation (depreciation) on investments............ 67,782,146 43,128,888
-------------- --------------
Net Increase (Decrease) in Net Assets Resulting from Operations.. 111,454,696 55,669,663
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net................................................ (11,705,971) (4,476,568)
Net realized gain on investments..................................... (12,675,130) (2,357,447)
-------------- --------------
Total Dividends.................................................. (24,381,101) (6,834,015)
-------------- --------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................ 520,828,128 219,772,239
Dividends reinvested................................................. 24,381,101 6,834,015
Cost of shares redeemed.............................................. (131,010,511) (59,561,665)
-------------- --------------
Increase (Decrease) in Net Assets from Capital Stock Transactions 414,198,718 167,044,589
-------------- --------------
Total Increase (Decrease) in Net Assets........................ 501,272,313 215,880,237
NET ASSETS:
Beginning of Period.................................................. 312,686,460 96,806,223
-------------- --------------
End of Period........................................................ $813,958,773 $312,686,460
============== ==============
Undistributed investment income--net.................................... $ 96,693 $ 14,894
-------------- --------------
<CAPTION>
CAPITAL SHARE TRANSACTIONS:
Shares Shares
-------------- --------------
<S> <C> <C>
Shares sold.......................................................... 27,543,376 14,313,682
Shares issued for dividends reinvested............................... 1,269,483 417,105
Shares redeemed...................................................... (6,861,606) (4,033,543)
-------------- --------------
Net Increase (Decrease) in Shares Outstanding.................... 21,951,253 10,697,244
============== ==============
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Financial Highlights
Reference is made to page 3 of the Fund's Prospectus dated May 1, 1997.
See notes to financial statements.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
NOTE 1--Significant Accounting Policies:
Dreyfus Stock Index Fund (the "Fund") is registered under the Investment
Company Act of 1940 ("Act") as a non-diversified open-end management investment
company, that is intended to be a funding vehicle for variable annuity contracts
and variable life insurance policies to be offered by the separate accounts of
life insurance companies. The Fund's investment objective is to provide
investment results that correspond to the price and yield performance of
publicly traded common stocks as represented by the Standard and Poor's 500
Composite Stock Price Index. The Dreyfus Corporation ("Dreyfus") serves as the
Fund's manager and Mellon Equity Associates ("Mellon Equity"), an affiliate of
Dreyfus, serves as the Fund's index manager. Boston Safe Deposit and Trust
Company, an affiliate of Dreyfus, is the Fund's custodian. Dreyfus is a direct
subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services, Inc. acts as the
distributor of the Fund's shares, which are sold without a sales charge.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities (including financial
futures) are valued at the last sales price on the securities exchange on which
such securities are primarily traded or at the last sales price on the national
securities market. Securities not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is used
when no asked price is available. Investments denominated in foreign currencies
are translated to U.S. dollars at the prevailing rates of exchange.
(b) Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis.
(c) Dividends to shareholders: Dividends are recorded on the ex-dividend date.
Dividends from investment income-net are declared and paid on a quarterly basis.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code. This may result
in distributions that are in excess of investment income-net on a fiscal year
basis. To the extent that net realized capital gain can be offset by capital
loss carryovers, if any, it is the policy of the Fund not to distribute such
gain.
(d) Federal income taxes: It is the policy of the Fund to continue to qualify
as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the provisions available to
certain investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of taxable income sufficient to relieve
it from substantially all Federal income and excise taxes.
NOTE 2--Bank Line ofCredit:
The Fund participates with other Dreyfus managed funds in a $100 million
unsecured line of credit primarily to be utilized for temporary or emergency
purposes, including the financing of redemptions. Interest is charged to the
Fund at rates which are related to the Federal Funds rate in effect at the time
of borrowings. For the period ended December 31, 1996, the Fund did not borrow
under the line of credit.
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 3--Management Fee and Other Transactions With Affiliates:
(a) Pursuant to an Investment Advisory Agreement with Dreyfus, the investment
advisory fee is computed at the annual rate of .245 of 1% of the value of the
Fund's average daily net assets, and is payable monthly. Dreyfus has agreed to
pay Mellon Equity, a monthly fee at the annual rate of .095 of 1% of the value
of the Fund's average daily net assets. Dreyfus has currently undertaken from
January 1, 1996 until December 31, 1996 and thereafter until such a time as they
give shareholders at least 180 days notice to the contrary that if in any full
fiscal year the Fund's aggregate expenses (exclusive of brokerage commissions,
transaction fees and extraordinary expenses) exceed an annual rate of .40 of 1%
of the value of the Fund's average daily net assets, the Fund may deduct from
the payments to be made to Dreyfus, or Dreyfus will bear, such excess expense.
There was no expense reim bursement for the period ended December 31, 1996.
(b) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus, an amount not
to exceed an annual rate of .25 of 1% of the value of the Fund's average daily
net assets for certain allocated expenses with respect to servicing and/or
maintaining shareholder accounts. During the period ended December 31, 1996, the
Fund was charged an aggregate of $9,218 pursuant to the Shareholder Services
Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such compensation
amounted to $362 during the period ended December 31, 1996.
(c) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4--Securities Transactions:
(a) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the period ended December 31, 1996
amounted to $424,886,551 and $51,539,693, respectively.
The Fund may invest in financial futures contracts in order to gain exposure
to or protect against changes in the market. The Fund is exposed to market risk
as a result of changes in the value of the underlying financial instruments (see
the Statement of Financial Futures). Investments in financial futures require
the Fund to "mark to market" on a daily basis, which reflects the change in the
market value of the contract at the close of each day's trading. Accordingly,
variation margin payments are received or made to reflect daily unrealized gains
or losses. When the contracts are closed, the Fund recognizes a realized gain or
loss. These investments require initial margin deposits with a custodian, which
consist of cash or cash equivalents, up to approximately 10% of the contract
amount. The amount of these deposits is determined by the exchange or Board of
Trade on which the contract is traded and is subject to change. Contracts open
at December 31, 1996 and their related unrealized market depreciation are set
forth in the Statement of Financial Futures.
(b) At December 31, 1996, accumulated net unrealized appreciation on
investments was $114,124,770, consisting of $121,757,907 gross unrealized
appreciation and $7,633,137 gross unrealized depreciation.
At December 31, 1996, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
<PAGE>
Dreyfus Stock Index Fund
- --------------------------------------------------------------------------------
Report of Independent Accountants
To the Shareholders and Board of Directors of
Dreyfus Stock Index Fund:
We have audited the accompanying statement of assets and liabilities of
Dreyfus Stock Index Fund, including the statements of investments and financial
futures, as of December 31, 1996, and the related statement of operations for
the year then ended, the statement of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
four years in the period then ended, for the period September 1, 1992 to
December 31, 1992, and the year ended August 31, 1992. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and 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 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
December 31, 1996, 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 financial highlights referred to
above present fairly, in all material respects, the financial position of
Dreyfus Stock Index Fund as of December 31, 1996, the results of its operations,
the changes in its net assets, and the financial highlights for the periods
referred to above, in conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New York, New York
January 29, 1997
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
(D/B/A Dreyfus Stock Index Fund)
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement:
Condensed Financial Information for the period from September
29, 1989 (commencement of operations) to August 31, 1990 and
for the fiscal years ended August 31, 1991 and 1992, and for
the four months ended December 31, 1992, and for the fiscal
years ended December 31, 1993, 1994, 1995 and 1996.
Included in Part B of the Registration Statement:
Statement of Investments-- December 31, 1996.
Statement of Financial Futures-- December 31, 1996.
Statement of Assets and Liabilities--December 31, 1996.
Statement of Operations--For the fiscal year ended
December 31, 1996.
Statement of Changes in Net Assets--For the fiscal years
ended December 31, 1995 and 1996.
Notes to Financial Statements.
Report of Coopers & Lybrand L.L.P., Independent
Accountants, dated April 11, 1997.
Schedules No. I through VII and other financial statement information, for
which provision is made in the applicable accounting regulations of the
Securities and Exchange Commission, are either omitted because they are not
required under the related instructions, they are inapplicable, or the
required information is presented in the financial statements or notes
thereto which are included in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1) Articles of Incorporation is incorporated by reference to Exhibit
(1) of Post-Effective Amendment No. 6 to the Registration
Statement on Form N-1A, filed on April 20, 1994.
(2) By-Laws are incorporated by reference to Exhibit (2) of Post-
Effective Amendment No. 6 to the Registration Statement on Form N-
1A, filed on April 20, 1994.
(5)(a) Management Agreement is incorporated by reference to Exhibit
(5)(a) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on February 29, 1996.
(5)(b) Index Management Agreement is incorporated by reference to Exhibit
(5)(b) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on February 29, 1996.
(6) Distribution Agreement is incorporated by reference to Exhibit (6)
of Post-Effective Amendment No. 7 to the Registration Statement on
Form N-1A, filed on March 2, 1995.
(8) Custody Agreement is incorporated by reference to Exhibit (8) of
Post-Effective Amendment No. 8 to the Registration Statement on
Form N-1A, filed on February 29, 1996.
(9) Shareholder Services Plan is incorporated by reference to Exhibit
(9) of Post-Effective Amendment No. 7 to the Registration
Statement on Form N-1A, filed on March 2, 1995.
(10) Opinion and consent of Stroock & Stroock & Lavan dated September
20, 1989 is incorporated by reference to Exhibit (10) of Post-
Effective Amendment No. 6 to the Registration Statement on Form N-
1A, filed on April 20, 1994.
(11) Consent of Coopers & Lybrand L.L.P., Independent Accountants.
(17) Financial Data Schedule.
Item 25. Persons Controlled by or under Common Control with Registrant.
_______ ______________________________________________________________
Not Applicable
Item 26. Number of Holders of Securities.
_______ ________________________________
(1) (2)
Number of Record
Title of Class Holders as of April 2, 1997
______________ ______________________________
Shares of Common Stock 27
par value $.001 per share
Item 27. Indemnification
_______ _______________
The Statement as to the general effect of any contract,
arrangements or statute under which a director, officer,
underwriter or affiliated person of the Registrant is indemnified
is incorporated by reference to Item 27 of Part C of Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-1A, filed
on September 8, 1989.
Reference is also made to the Distribution Agreement filed as
Exhibit (6).
Item 28(a). Business and Other Connections of Investment Adviser.
_______ _____________________________________________________
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business
consists primarily of providing investment management
services as the investment adviser, manager and distributor
for sponsored investment companies registered under the
Investment Company Act of 1940 and as an
investment adviser to institutional and individual accounts.
Dreyfus also serves as sub-investment adviser to and/or
administrator of other investment companies. Dreyfus Service
Corporation, a wholly-owned subsidiary of Dreyfus, serves
primarily as a registered broker-dealer of shares of
investment companies sponsored by Dreyfus and of other
investment companies for which Dreyfus acts as investment
adviser, sub-investment adviser or administrator. Dreyfus
Management, Inc., another wholly-owned subsidiary, provides
investment management services to various pension plans,
institutions and individuals.
Item 28(a). Business and Other Connections of Investment Adviser (continued)
________ _____________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees:
Skillman Foundation;
Member of The Board of Vintners Intl.
BURTON C. BORGELT Chairman Emeritus of the Board and
Director Past Chairman, Chief Executive Officer and
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405;
Director:
DeVlieg-Bullard, Inc.
1 Gorham Island
Westport, Connecticut 06880
Mellon Bank Corporation***;
Mellon Bank, N.A.***
FRANK V. CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation***;
Mellon Bank, N.A.***;
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
W. KEITH SMITH Chairman and Chief Executive Officer:
Chairman of the Board The Boston Company****;
Vice Chairman of the Board:
Mellon Bank Corporation***;
Mellon Bank, N.A.***;
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
CHRISTOPHER M. CONDRON Vice Chairman:
President, Chief Mellon Bank Corporation***;
Executive Officer, The Boston Company****;
Chief Operating Deputy Director:
Officer and a Mellon Trust***;
Director Chief Executive Officer:
The Boston Company Asset Management,
Inc.****;
President:
Boston Safe Deposit and Trust Company****
STEPHEN E. CANTER Director:
Vice Chairman and The Dreyfus Trust Company++;
Chief Investment Officer, Formerly, Chairman and Chief Executive Officer:
and a Director Kleinwort Benson Investment Management
Americas Inc.*
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman-Distribution Executive Officer:
and a Director The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
Executive Vice President and Director:
Dreyfus Service Organization, Inc.**;
Director:
Dreyfus America Fund
The Dreyfus Consumer Credit Corporation*;
The Dreyfus Trust Company++;
Dreyfus Service Corporation*;
President:
The Boston Company****;
Laurel Capital Advisors***;
Boston Group Holdings, Inc.;
Executive Vice President:
Mellon Bank, N.A.***;
Boston Safe Deposit and Trust
Company****;
WILLIAM T. SANDALLS, JR. Director:
Senior Vice President and Dreyfus Partnership Management, Inc.*;
Chief Financial Officer Seven Six Seven Agency, Inc.*;
President and Director:
Lion Management, Inc.*;
Executive Vice President and Director:
Dreyfus Service Organization, Inc.*;
Vice President, Chief Financial Officer and
Director:
Dreyfus Acquisition Corporation*;
Dreyfus America Fund
Vice President and Director:
The Dreyfus Consumer Credit Corporation*;
The Truepenny Corporation*;
Treasurer, Financial Officer and Director:
The Dreyfus Trust Company++;
Treasurer and Director:
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Service Corporation*;
Major Trading Corporation*;
Formerly, President and Director:
Sandalls & Co., Inc.
MARK N. JACOBS Vice President, Secretary and Director:
Vice President, Lion Management, Inc.*;
General Counsel Secretary:
and Secretary The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.**;
Major Trading Corporation*;
The Truepenny Corporation*
PATRICE M. KOZLOWSKI None
Vice President-
Corporate Communications
MARY BETH LEIBIG None
Vice President-
Human Resources
JEFFREY N. NACHMAN President and Director:
Vice President-Mutual Fund Dreyfus Transfer, Inc.
Accounting One American Express Plaza
Providence, Rhode Island 02903
ANDREW S. WASSER Vice President:
Vice President-Information Mellon Bank Corporation***
Services
ELVIRA OSLAPAS Assistant Secretary:
Assistant Secretary Dreyfus Service Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Acquisition Corporation, Inc.*;
The Truepenny Corporation+
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 131 Second Street,
Lewes, Delaware 19958.
*** The address of the business so indicated is One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258.
**** The address of the business so indicated is One Boston Place,
Boston, Massachusetts 02108.
+ The address of the business so indicated is Atrium Building,
80 Route 4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
Item 28(b). Business and Other Connections of Sub-Investment Adviser
________ ___________________________________________________________
Registrant is fulfilling the requirement of this Item 28(b) to
provide a list of the officers and directors of Mellon Equity Associates,
the Registrant's sub-investment adviser (the "Sub-Adviser"), together with
information as to any other business, profession, vocation or employment of
a substantial nature engaged in by the Sub-Adviser or those of its officers
and directors during the past two years, by incorporating by reference the
information contained in the Form ADV filed with the SEC pursuant to the
Investment Advisers Act of 1940 by the Sub-Adviser (SEC File No. 801-28692).
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Funds, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC GNMA Fund
7) Dreyfus BASIC Money Market Fund, Inc.
8) Dreyfus BASIC Municipal Fund, Inc.
9) Dreyfus BASIC U.S. Government Money Market Fund
10) Dreyfus California Intermediate Municipal Bond Fund
11) Dreyfus California Tax Exempt Bond Fund, Inc.
12) Dreyfus California Tax Exempt Money Market Fund
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) Dreyfus Florida Intermediate Municipal Bond Fund
18) Dreyfus Florida Municipal Money Market Fund
19) The Dreyfus Fund Incorporated
20) Dreyfus Global Bond Fund, Inc.
21) Dreyfus Global Growth Fund
22) Dreyfus GNMA Fund, Inc.
23) Dreyfus Government Cash Management
24) Dreyfus Growth and Income Fund, Inc.
25) Dreyfus Growth and Value Funds, Inc.
26) Dreyfus Growth Opportunity Fund, Inc.
27) Dreyfus Income Funds
28) Dreyfus Institutional Money Market Fund
29) Dreyfus Institutional Short Term Treasury Fund
30) Dreyfus Insured Municipal Bond Fund, Inc.
31) Dreyfus Intermediate Municipal Bond Fund, Inc.
32) Dreyfus International Funds, Inc.
33) Dreyfus Investment Grade Bond Funds, Inc.
34) The Dreyfus/Laurel Funds, Inc.
35) The Dreyfus/Laurel Funds Trust
36) The Dreyfus/Laurel Tax-Free Municipal Funds
37) Dreyfus LifeTime Portfolios, Inc.
38) Dreyfus Liquid Assets, Inc.
39) Dreyfus Massachusetts Intermediate Municipal Bond Fund
40) Dreyfus Massachusetts Municipal Money Market Fund
41) Dreyfus Massachusetts Tax Exempt Bond Fund
42) Dreyfus MidCap Index Fund
43) Dreyfus Money Market Instruments, Inc.
44) Dreyfus Municipal Bond Fund, Inc.
45) Dreyfus Municipal Cash Management Plus
46) Dreyfus Municipal Money Market Fund, Inc.
47) Dreyfus New Jersey Intermediate Municipal Bond Fund
48) Dreyfus New Jersey Municipal Bond Fund, Inc.
49) Dreyfus New Jersey Municipal Money Market Fund, Inc.
50) Dreyfus New Leaders Fund, Inc.
51) Dreyfus New York Insured Tax Exempt Bond Fund
52) Dreyfus New York Municipal Cash Management
53) Dreyfus New York Tax Exempt Bond Fund, Inc.
54) Dreyfus New York Tax Exempt Intermediate Bond Fund
55) Dreyfus New York Tax Exempt Money Market Fund
56) Dreyfus 100% U.S. Treasury Intermediate Term Fund
57) Dreyfus 100% U.S. Treasury Long Term Fund
58) Dreyfus 100% U.S. Treasury Money Market Fund
59) Dreyfus 100% U.S. Treasury Short Term Fund
60) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
61) Dreyfus Pennsylvania Municipal Money Market Fund
62) Dreyfus Premier Insured Municipal Bond Fund
63) Dreyfus Premier California Municipal Bond Fund
64) Dreyfus Premier Equity Funds, Inc.
65) Dreyfus Premier Global Investing, Inc.
66) Dreyfus Premier GNMA Fund
67) Dreyfus Premier Growth Fund, Inc.
68) Dreyfus Premier Municipal Bond Fund
69) Dreyfus Premier New York Municipal Bond Fund
70) Dreyfus Premier State Municipal Bond Fund
71) Dreyfus Premier Strategic Growth Fund
72) Dreyfus Premier Value Fund
73) Dreyfus S&P 500 Index Fund
74) Dreyfus Short-Intermediate Government Fund
75) Dreyfus Short-Intermediate Municipal Bond Fund
76) The Dreyfus Socially Responsible Growth Fund, Inc.
77) Dreyfus Stock Index Fund
78) Dreyfus Tax Exempt Cash Management
79) The Dreyfus Third Century Fund, Inc.
80) Dreyfus Treasury Cash Management
81) Dreyfus Treasury Prime Cash Management
82) Dreyfus Variable Investment Fund
83) Dreyfus Worldwide Dollar Money Market Fund, Inc.
84) General California Municipal Bond Fund, Inc.
85) General California Municipal Money Market Fund
86) General Government Securities Money Market Fund, Inc.
87) General Money Market Fund, Inc.
88) General Municipal Bond Fund, Inc.
89) General Municipal Money Market Fund, Inc.
90) General New York Municipal Bond Fund, Inc.
91) General New York Municipal Money Market Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
__________________ ___________________________ _____________
Marie E. Connolly+ Director, President, Chief President and
Executive Officer and Compliance Treasurer
Officer
Joseph F. Tower, III+ Senior Vice President, Treasurer Vice President
and Chief Financial Officer and Assistant
Treasurer
John E. Pelletier+ Senior Vice President, General Vice President
Counsel, Secretary and Clerk and Secretary
Roy M. Moura+ First Vice President None
Dale F. Lampe+ Vice President None
Mary A. Nelson+ Vice President Vice President
and Assistant
Treasurer
Paul Prescott+ Vice President None
Elizabeth A. Keeley++ Assistant Vice President Vice President
and Assistant
Secretary
Jean M. O'Leary+ Assistant Secretary and None
Assistant Clerk
John W. Gomez+ Director None
William J. Nutt+ Director None
________________________________
+ Principal business address is One Exchange Place, Boston, Massachusetts
02109.
++ Principal business address is 200 Park Avenue, New York, New York
10166.
Item 30. Location of Accounts and Records
________________________________
1. First Data Investor Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. Boston Safe Deposit and Trust Company
One Boston Place
Boston, Massachusetts 02108
3. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
4. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a Board member or Board members when
requested in writing to do so by the holders of at least 10% of
the Registrant's outstanding shares and in connection with such
meeting to comply with the provisions of Section 16(c) of the
Investment Company Act of 1940 relating to shareholder
communications.
(2) To furnish each person to whom a prospectus is delivered with a
copy of the Fund's latest Annual Report to Shareholders, upon
request and without charge.
SIGNATURES
__________
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New
York, and State of New York on the 14th day of April, 1997.
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
BY: /s/Marie E. Connolly*
____________________________
MARIE E. CONNOLLY, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons
in the capacities and on the date indicated.
Signatures Title Date
__________________________ ______________________________ _________
/s/Marie E. Connolly* President and Treasurer 4/14/97
______________________________ (Principal Executive, Financial
Marie E. Connolly and Accounting Officer)
/s/Joseph S. DiMartino* Chairman of the Board 4/14/97
_____________________________
Joseph S. DiMartino
/s/David P. Feldman* Board Member 4/14/97
______________________________
David P. Feldman
/s/John M. Fraser, Jr.* Board Member 4/14/97
______________________________
John M. Fraser, Jr.
/s/Ehud Houminer* Board Member 4/14/97
______________________________
Ehud Houminer
/s/David J. Mahoney* Board Member 4/14/97
______________________________
David J. Mahoney
/s/Gloria Messinger* Board Member 4/14/97
______________________________
Gloria Messinger
/s/Jack R. Meyer* Board Member 4/14/97
______________________________
Jack R. Meyer
/s/John Szarkowski* Board Member 4/14/97
_____________________________
John Szarkowski
/s/Anne Wexler* Board Member 4/14/97
_____________________________
Anne Wexler
*BY: /s/ Elizabeth A. Keeley
__________________________
Elizabeth A. Keeley,
Attorney-in-Fact
EXHIBIT INDEX
ITEM EXHIBIT PAGE
(11) Consent of Coopers & Lybrand L.L.P.,
Independent Accountants
(7) Financial Data Schedule
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of
Dreyfus Stock Index Fund:
We consent to the inclusion in Post-Effective Amendment No. 9 to the
Registration Statement of the Dreyfus Stock Index Fund on Form N-1A (File No.
33-27172) of our report dated January 29, 1997, on our audit of the financial
statemen ts and financial highlights of the Dreyfus Stock Index Fund.
We also consent to the reference to our Firm under the heading "Transfer and
Dividend Disbursing Agent, Custodian, Counsel and Independent Accountants".
Coopers & Lybrand L.L.P.
New York, New York
April 11, 1997
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