Rule 497(e)
File Nos. 33-34841 and 811-6011
THE MONTGOMERY FUNDS
Supplement dated March 30, 2000 to the
Prospectus dated October 31, 1999
For Shareholders of Montgomery International Growth Fund and Montgomery
International Small Cap Fund only:
Effective April 5, 2000, the Manager will institute a redemption fee of 2% on
any shares of the International Growth Fund redeemed within three months after
purchase (subject to regulatory approval). Shares of the International Growth
Fund purchased on or before April 5, 2000 (including those investments in the
International Small Cap Fund made before the merger with the International
Growth Fund) will not be subject to this redemption fee. However, subsequent
investments made after April 5, 2000 will be covered by this new redemption fee.
Please be assured that this addition of a redemption fee in no way increases or
otherwise changes the operating costs or expenses to shareholders. Shown below
is the revised fee and expense table for the International Growth Fund (found on
page 13 of the prospectus).
The Manager believes that this action is necessary to prevent excessive flows of
cash into or out of the International Growth Fund, which can harm the Fund's
performance when unanticipated. In addition, because transaction costs in some
of the international markets in which the Fund invests can be relatively high,
increased turnover from significant cash flows increases the Fund's total
expenses.
Investors should retain this supplement with the prospectus for future
reference.
If we can provide any more information, please call our shareholder service
representatives at (800) 572-FUND [3863] or visit our award-winning Web site at
www.montgomeryfunds.com. We look forward to continuing to meet your investment
needs.
Sincerely,
THE MONTGOMERY FUNDS
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Fees & Expenses
<TABLE>
The following table shows the fees and expenses you may pay if you buy and hold
shares of the Fund. Montgomery does not impose any front-end or deferred sales
loads on this Fund.
<S> <C>
Shareholder Fees (fees paid directly from your investment)
Redemption Fee ** 2.00%
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)++
Management Fee 1.10%
Distribution/Service (12b-1) Fee 0.00%
Other Expenses 0.64%
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Total Annual Fund Operating Expenses 1.74%
Fee Reduction and/or Expense Reimbursement 0.08%
Net Expenses 1.66%
<FN>
** Deducted from net proceeds of shares redeemed (or exchanged) within three
months after purchase, except for certain fee-based programs, and for
shares purchased on or before April 5, 2000. This fee is retained by the
Fund. $10 will be deducted from redemption proceeds sent by wire or
overnight courier.
++ Montgomery Asset Management has contractually agreed to reduce its fees
and/or absorb expenses to limit the Fund's total annual operating expenses
(excluding interest and tax expenses) to 1.65%. This contract has a rolling
10-year term.
</FN>
</TABLE>
