SMITH BARNEY WORLD FUNDS, INC.
GLOBAL GOVERNMENT BOND PORTFOLIO
Supplement dated September 25, 1996
to the Prospectus dated February 28, 1996
Currently, the prospectus for the Global Government Bond Portfolio
provides that the Portfolio may invest in government securities of less
developed countries only if the issue or the issuer thereof is rated in
the top four investment rating categories, commonly referred to as
investment grade securities, or if unrated, are judged to be of
comparable quality by the investment adviser.
Effective October 14, 1996, the Board of Directors of the Fund has
approved permitting the Portfolio to invest in the government securities
of less developed countries that are rated below investment grade.
Thus, the following information supplements, and to the extent
inconsistent therewith, supersedes, the information in the Prospectus:
Investments may be made from time to time in government
securities, including loan assignments and loan participations, of
less developed countries. Such countries currently include
Argentina, Brazil, Bulgaria, Czech Republic, Ecuador, Hungary,
Indonesia, Lithuania, Malaysia, Mexico, Peru, Philippines, Poland,
Russia, Slovakia, South Africa, Thailand, Turkey, Uruguay and
Venezuela. Countries may be added to or deleted from this list as
economic and political conditions warrant. Historical experience
indicates that the markets of less developed countries have been
more volatile than the markets of the more mature economies of
developed countries; however, such markets often provide rates of
return to investors commensurate with the credit and market risks.
The investment adviser does not intend to invest more than 10% of
the Fund's assets in the government securities of less developed
countries and will not invest more than 5% of the Fund's assets in
the government securities of any one such country. Such
investments may be unrated or rated below investment grade or may
be in default. Securities rated below investment grade (and
comparable unrated securities) are the equivalent of high yield,
high risk bonds. Such securities are regarded as predominantly
speculative with respect to the issuer's capacity to pay interest
and repay principal in accordance with the terms of the
obligations and involve major risk exposure to adverse business,
financial, economic, and political conditions, whether or not
occurring within the issuers' borders.
FD 01194 9/96
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