AETNA SERIES FUND INC, 497, 1995-08-09

AETNA SERIES FUND INC
497, 1995-08-09

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AETNA SERIES FUND, INC.
July 28, 1995 Supplement to the March 31, 1995 Prospectus

Effective July 28, 1995 Kevin M. Means has replaced Martin J. Duffy as the
Portfolio Manager for the Growth and Income Fund. The following paragraph
replaces the Growth and Income Fund Portfolio Management section currently
printed in the prospectus on page 40:

Growth and Income Fund. Kevin M. Means, Portfolio Manager, ALIAC. Mr. Means
has over eight years investment management experience. Before joining ALIAC in
1994 he was with INVESCO Capital Management, Inc. Vince Fioramonti, who is
responsible for Hong Kong transactions for this Fund, has been with ALIAC since
1994 and has over 7 years of international investment experience.

<PAGE>

Adviser Class

March 31, 1995

Aetna
Mutual Funds
Prospectus
-------------------------------------------------------------------------------

The Company Aetna Series Fund, Inc. (the "Company") is an open-end management
investment company authorized to issue multiple series of shares, each
representing a diversified portfolio of investments (collectively the "Funds,"
individually a "Fund") with different investment objectives, policies and
restrictions. Currently, each Fund is authorized to offer two classes of
shares, the Adviser Class and the Select Class.

The Prospectus This Prospectus contains information you should know before
investing. A Statement of Additional Information ("SAI") dated March 31, 1995,
has been filed with the Securities and Exchange Commission ("Commission") and
is incorporated by reference into this Prospectus. The SAI is available,
without charge, by writing to Aetna Series Fund, Inc., 151 Farmington Avenue,
Hartford, CT 06156-8962, by calling 1-800-367-7732, or through your
representative.

This Prospectus is for investors eligible to purchase Adviser Class shares of
each Fund. A separate Prospectus is available for investors eligible to
purchase Select Class shares of each Fund. Sales charges, expenses and
performance will vary with respect to each class.

Investment Objectives
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Aetna Money Market Fund seeks to provide high current return, consistent with
preservation of capital and liquidity, through investment in high-quality money
market instruments.

Although the Money Market Fund will strive to maintain a $1.00 net asset value
per share, there is no assurance that it will be able to do so. Investments in
this Fund are neither insured nor guaranteed by the U.S. Government.

Aetna Government Fund seeks to provide income consistent with the preservation
of capital through investment in securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

Aetna Bond Fund seeks to provide high total return (i.e., income and capital
appreciation), consistent with reasonable risk, primarily through investment in
a diversified portfolio of high-quality corporate bonds and securities issued
or guaranteed by the U.S. Government, its agencies or instrumentalities.

Aetna Tax-Free Fund seeks to provide income exempt from federal income tax
consistent with the preservation of capital primarily through investment in
municipal securities, the interest from which is exempt from federal income
tax.

<PAGE>

The Aetna Fund seeks to maximize total return with reasonable safety of
principal by investing in a diversified portfolio of stocks, bonds and money
market instruments; the Aetna Fund may involve less investment risk than a
portfolio consisting entirely of common stocks.

Aetna Growth and Income Fund seeks long-term growth of capital and income
through investment in a diversified portfolio primarily of common stocks and
securities convertible into common stocks believed to offer above-average
growth potential.

Aetna Growth Fund seeks growth of capital through investment in a diversified
portfolio primarily of common stocks and securities convertible into common
stocks believed to offer growth potential.

Aetna Small Company Growth Fund seeks growth of capital primarily through
investment in a diversified portfolio of common stocks and securities
convertible into common stocks of companies with smaller market
capitalizations.

Aetna International Growth Fund seeks long-term capital growth primarily
through investment in a diversified portfolio of common stocks principally
traded in countries outside of North America.

Aetna Asian Growth Fund seeks long-term growth of capital primarily through
investment in a diversified portfolio of common stocks principally traded in
countries in Asia excluding Japan.

LIKE ALL MUTUAL FUNDS, 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. PLEASE READ THIS
PROSPECTUS CAREFULLY BEFORE INVESTING AND RETAIN FOR FUTURE REFERENCE.

2 Aetna Mutual Funds Prospectus

<PAGE>

Table of Contents

Highlights............................. 4
Fee Tables............................. 6
Financial Highlights................... 10
Description of the Funds............... 14
Risk Factors and Other Considerations.. 21
Investment Restrictions................ 26
Shareholder Services................... 27
Other Features......................... 33
Cross-Fund Investing................... 34
Fees and Charges....................... 34
Management of the Funds................ 36
Portfolio Management................... 40
Fund Distributions..................... 41
Net Asset Value........................ 42
Taxes.................................. 42
General Information.................... 44
Performance Data....................... 46
Glossary of Investment Terms........... 46
Description of Corporate Bond Ratings.. 49

Aetna Mutual Funds Prospectus 3

<PAGE>

Highlights

What is a Mutual Fund and What are its Advantages? A mutual fund is an
investment company that buys and sells securities on behalf of individuals
sharing common financial goals. Mutual funds allow you to pool your money with
others, to spread risk through diversification and to benefit from professional
management. You have immediate access to your money simply by writing a letter
or, in the case of the Aetna Money Market Fund, by writing a check.

What Funds are Offered? The Company is currently comprised of 13 different
Funds, each with its own objective and policies and all of which are
diversified portfolios under the Investment Company Act of 1940. The following
ten Funds are described in this Prospectus:

* Aetna Money Market Fund (Money Market Fund) - a portfolio consisting of
high-quality money market instruments

* Aetna Government Fund (Government Fund) - a portfolio of U.S. Government
securities

* Aetna Bond Fund (Bond Fund) - a portfolio primarily of high-quality corporate
and U.S. Government securities

* Aetna Tax-Free Fund (Tax-Free Fund) - a portfolio primarily of municipal
securities

* The Aetna Fund (Aetna Fund) - a flexible portfolio of stocks, bonds and money
market instruments

* Aetna Growth and Income Fund (Growth and Income Fund) - a common stock
portfolio

* Aetna Growth Fund (Growth Fund) - a common stock portfolio of companies
believed to have potential for growth

* Aetna Small Company Growth Fund (Small Company Growth Fund) - a common stock
portfolio of companies with smaller market capitalizations

* Aetna International Growth Fund (International Growth Fund) - a common stock
portfolio of companies traded outside North America

* Aetna Asian Growth Fund (Asian Growth Fund) - a common stock portfolio of
companies traded in Asia excluding Japan

Risk Factors The different types of securities purchased and investment
techniques used by a Fund involve varying amounts of risk. For example, equity
securities are subject to a decline in the stock market or in the value of the
company and preferred stocks have price risk and some interest rate and credit
risk. The value of debt securities may be affected by changes in general
interest rates and in the credit worthiness of the issuer. In addition, foreign
securities have currency risk. For more information, see "Risk Factors and
Other Considerations."

What is the Adviser Class of Shares? Each Fund has two classes of shares:
Adviser Class shares, which are offered primarily to the general public, and
Select Class shares, which are offered principally to institutions.

Aetna Mutual Funds Prospectus 4

<PAGE>

Adviser Class shares are subject to a contingent deferred sales charge (CDSC).
The maximum CDSC is 1.0% of redemption proceeds, declining by 0.25% each year
after the date of purchase to zero, so that no charge is imposed on shares
purchased over four years prior to redemption. Adviser Class shares of each
Fund are also subject to an annual service fee of 0.25% (0.10% for the Money
Market Fund) and (except for the Money Market Fund) an annual distribution fee
of 0.50% of the value of average daily net assets. See "Fees and Charges" for
more information.

How Can I Purchase Shares? You may purchase Adviser Class shares by completing
an Aetna Series Fund Adviser Class Application ("Application"). Your initial
purchase must be for a minimum of $1,000 for each Fund with a minimum of $500
for Individual Retirement Accounts ("IRA"). We also of fer a systematic
investment program that enables investors to purchase shares on a regular
basis. Please refer to "Shareholder Services" for complete details.

When Can I Redeem Shares? Shares may be redeemed on each day the New York Stock
Exchange, Inc. (NYSE) is open for business. Adviser Class shares are redeemable
at net asset value less any applicable CDSC. See "Shareholder Services" for
more information.

Who is the Manager? Aetna Life Insurance and Annuity Company ("ALIAC") is the
Investment Adviser to each Fund. It is a wholly owned subsidiary of Aetna Life
and Casualty Company ("Aetna") which, with affiliated companies, comprises one
of the world's leading providers of insurance and financial services. As of
December 31, 1994, the Investment Adviser managed over $19 billion of assets
worldwide for both individual and institutional investors.

Aeltus Investment Management, Inc. ("Aeltus") is the sub-adviser to the
Tax-Free Fund, the Growth Fund and the Small Company Growth Fund and Aeltus
Investment Management International (F.E.) Limited ("Aeltus Far East") is the
sub-adviser to the Asian Growth Fund. As of December 31, 1994, Aeltus and its
affiliate Aeltus Far East managed over $20 billion of assets.

Dunedin Fund Managers Ltd. ("Dunedin") is the sub-adviser to the International
Growth Fund. Dunedin is an operationally independent subsidiary of The Bank of
Scotland and has a history of fund management dating back to 1873. Dunedin had
total funds under management of $7.4 billion as of December 31, 1994. Dunedin
is a member of the Investment Management Regulatory Organization ("IMRO").
Dunedin's conduct of investment business is regulated by IMRO.

Please refer to "Management of the Funds" for further information.

Customer Service Shareholders in the Funds enjoy a high level of personalized
service. Please call your representative for details or refer to "Shareholder
Services" for detailed information.

Aetna Mutual Funds Prospectus 5

<PAGE>

Fee Tables

The following is provided to assist you in understanding the various expenses
that you would bear directly or indirectly as an investor in the Funds. A
complete description of expenses starts on page 34.
-------------------------------------------------------------------------------
Adviser Class
Shareholder Transaction Expenses
Deferred Sales Charge
Sales Charge Sales Charge on Dividend Exchange
on Purchases on Redemptions1 Reinvestment Fee
-----------------------------------------------------------------------
Money Market None 1.0% None None
Government None 1.0% None None
Bond None 1.0% None None
Tax-Free None 1.0% None None
Aetna Fund None 1.0% None None
Growth and Income None 1.0% None None
Growth None 1.0% None None
Small Company Growth None 1.0% None None
International Growth None 1.0% None None
Asian Growth None 1.0% None None

1 The contingent deferred sales charge set forth in the above table is the
maximum redemption charge imposed on Adviser Class shares. Direct purchases
into the Money Market Fund are not subject to a sales charge on redemption.
Investors may pay charges less than 1.0%, depending on the length of time the
shares are held. Adviser Class shares of each Fund other than the Money Market
Fund are also subject to an annual distribution fee of 0.50% and an annual
service fee of 0.25% (0.10% for Money Market Fund) of the value of average
daily net assets of the Adviser Class. See "Fees and Charges."
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Adviser Class
Annual Fund Operating Expenses*
(as a percentage of average daily net assets)
Total Fund
Management/ Other Operating
Advisory Fee Expenses** Expenses
(after expense 12b-1 (after expense (after expense
reimbursement) Fee reimbursement) reimbursement)
-----------------------------------------------------------------------
Money Market 0.00% 0.00% 0.40% 0.40%
Government 0.19% 0.50% 0.77% 1.46%
Bond 0.48% 0.50% 0.77% 1.75%
Tax-Free 0.25% 0.50% 0.85% 1.60%
Aetna Fund 0.80% 0.50% 0.70% 2.00%
Growth and Income 0.65% 0.50% 0.65% 1.79%
Growth 0.65% 0.50% 0.82% 1.97%
Small Company Growth 0.86% 0.50% 0.80% 2.16%
International Growth 0.75% 0.50% 1.05% 2.30%
Asian Growth 0.74% 0.50% 1.08% 2.32%

* The Company began offering Adviser Class shares on April 15, 1994.
Consequently, figures are based on estimated amounts for 1995.
** Other Expenses include Shareholder Services Fees.

The Investment Adviser may, from time to time, reimburse a Fund for some or all
of its operating expenses. Such reimbursement arrangements will increase a
Fund's return and may be terminated at any time. Without expense
reimbursement/fee waiver, the estimated Total Fund Operating Expenses for 1995
would be: 0.96% for Money Market Fund; 1.80% for Government; 1.77% for Bond;
1.85% for Tax-Free; 2.00% for Aetna Fund; 1.88% for Growth and Income; 2.01%
for Growth; 2.16% for Small Company Growth; 2.40% for International Growth; and
2.58% for Asian Growth.
-------------------------------------------------------------------------------

Aetna Mutual Funds Prospectus 6

<PAGE>

-------------------------------------------------------------------------------
Adviser Class
Example

Using the above expenses, you would pay the following expenses on a $1,000
investment, assuming a 5% annual return and either redemption at the end of
each of the periods shown or no redemption:

1 Year 3 Years 5 Years 10 Years
---------------------------------------------------------------------
Money Market
Redemption at end of each time period $4 $13 $22 $51
No Redemption 4 13 22 51
Government
Redemption at end of each time period 25 51 80 175
No Redemption 15 46 80 175
Bond
Redemption at end of each time period 28 60 95 206
No Redemption 18 55 95 206
Tax-Free
Redemption at end of each time period 26 55 87 190
No Redemption 16 50 87 190
Aetna Fund
Redemption at end of each time period 30 68 108 233
No Redemption 20 63 108 233
Growth and Income
Redemption at end of each time period 28 61 97 211
No Redemption 18 56 97 211
Growth
Redemption at end of each time period 30 67 106 230
No Redemption 20 62 106 230
Small Company Growth
Redemption at end of each time period 32 73 116 249
No Redemption 22 68 116 249
International Growth
Redemption at end of each time period 33 77 123 264
No Redemption 23 72 123 264
Asian Growth
Redemption at end of each time period 34 77 124 266
No Redemption 24 72 124 266

This example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.

Aetna Mutual Funds Prospectus 7

<PAGE>

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Select Class
Shareholder Transaction Expenses

Deferred Sales Charge
Sales Charge Sales Charge on Dividend Exchange
on Purchases on Redemptions Reinvestment Fee
----------------------------------------------------------------------
Money Market None None None None
Government None None None None
Bond None None None None
Tax-Free None None None None
Aetna Fund None None None None
Growth and Income None None None None
Growth None None None None
Small Company Growth None None None None
International Growth None None None None
Asian Growth None None None None

-------------------------------------------------------------------------------
Select Class
Annual Fund Operating Expenses*
(as a percentage of average daily net assets)
Total Fund
Management/ Administrative Other Operating
Advisory Fee Fee Expenses Expenses
(after expense (after expense (after expense (after expense
reimbursement) reimbursement) reimbursement) reimbursement)
--------------------------------------------------------------------------------
Money Market 0.00% 0.04% 0.17% 0.21%
Government 0.01% 0.09% 0.31% 0.41%
Bond 0.21% 0.25% 0.30% 0.76%
Tax-Free 0.03% 0.05% 0.23% 0.30%
Aetna Fund 0.57% 0.25% 0.27% 1.09%
Growth and Income 0.59% 0.25% 0.08% 0.92%
Growth 0.20% 0.24% 0.48% 0.92%
Small Company Growth 0.42% 0.24% 0.49% 1.15%
International Growth 0.72% 0.25% 0.69% 1.66%
Asian Growth 0.39% 0.25% 0.61% 1.25%

The Investment Adviser may, from time to time, reimburse a Fund for some or all
of its operating expenses. Such reimbursement arrangements will increase a
Fund's return and may be terminated at any time. Without expense
reimbursement/fee waiver, the Total Annualized Fund Operating Expenses for 1994
would have been: 0.85% for Money Market; 1.16% for Government; 1.06% for Bond;
1.20% for Tax-Free; 1.32% for Aetna Fund; 1.03% for Growth and Income; 1.42%
for Growth; 1.58% for Small Company Growth; 1.80% for International Growth; and
1.81% for Asian Growth.
*The expenses shown have been annualized based on the actual expenses for the
ten-month period ended October 31, 1994.
-------------------------------------------------------------------------------

Aetna Mutual Funds Prospectus 8

<PAGE>

Select Class
Example

Using the above expenses, you would pay the following expenses on a $1,000
investment, assuming a 5% annual return and redemption at the end of each of
the periods shown:
1 Year 3 Years 5 Years 10 Years
----------------------------------------------------
Money Market $2 $7 $12 $ 27
Government 4 13 23 52
Bond 8 24 42 94
Tax-Free 3 10 17 38
Aetna Fund 11 35 60 133
Growth and Income 9 29 51 113
Growth 9 29 51 113
Small Company Growth 12 37 63 140
International Growth 17 52 90 197
Asian Growth 13 40 69 151

This example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.

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

As noted above, each Fund has two classes, Adviser Class shares and Select
Class shares. Because the expenses and sales charges vary between the classes,
the performance of each class will vary. Registered representatives may receive
different levels of compensation when selling shares of the Fund's classes.
Additional information regarding each Fund's classes may be obtained by calling
your representative or 1-800-367-7732.

Aetna Mutual Funds Prospectus 9

<PAGE>

Financial Highlights
(for one outstanding share throughout each period)

The selected data presented below for, and as of the end of, the ten-month
period ended October 31, 1994 are derived from the financial statements of
Aetna Series Fund, Inc., which financial statements have been audited by KPMG
Peat Marwick LLP, independent auditors. The financial statements as of October
31, 1994 and the financial highlights for the ten-month period ended October
31, 1994, and the independent auditors' report thereon, are included in the
SAI.
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Adviser Class Shares~
Net
Net Asset Realized and Dividends Dividends
Value Net Unrealized Total from from Net in Excess of
Beginning Investment Gain (Loss) Investment Investment Net Investment
of Period Income on Investments Operations Income Income
--------- ---------- -------------- ---------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C>
Money Market Fund
Period from April 15, 1994-
October 31, 1994 $ 1.00 $0.03 $ 0.00 $ 0.03 $(0.03) $0.00
Government Fund
Period from April 15, 1994-
October 31, 1994 9.67 0.24 (0.24) 0.00 (0.26) 0.00
Bond Fund
Period from April 15, 1994-
October 31, 1994 9.92 0.28 (0.35) (0.07) (0.27) 0.00
Tax-Free Fund
Period from April 15, 1994-
October 31, 1994 9.32 0.21 (0.33) (0.12) (0.23) 0.00
The Aetna Fund
Period from April 15, 1994-
October 31, 1994 10.54 0.19 0.00 0.19 (0.11) 0.00
</TABLE>

~The Company commenced offering Adviser Class shares on April 15, 1994. Prior
to that date, the Company offered only Select Class shares.

* Annualized for periods less than one year.

Per share data calculated using weighted average of shares outstanding during
the period.

The Government Fund, Tax-Free Fund, Growth Fund, Small Company Growth Fund and
Asian Growth Fund commenced operations on January 2, 1994.

Additional information about the performance of Aetna Series Fund, Inc. is
contained in the Annual Report dated October 31, 1994. The Report is
incorporated herein by reference and is available, without charge, by writing
to the Company at the address listed on the cover of this Prospectus or by
calling 1-800-367-7732.

Aetna Mutual Funds Prospectus 10

<PAGE>

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<TABLE>
<CAPTION>

Ratio of
Ratio of Net
Total Investment
Investment Income
Ratio of Expense Before
Total Ratio of Before Reimburse-
Distributions Net Invest- Net Invest- Reimburse- ment
from Return of Asset Net Assets ment ment ment and Waiver
Realized Capital Value End of Expenses Income to and Waiver to Average
Gain on Distri- End of Total Period to Average Average to Average Net Portfolio
Investments bution Period Return (in thousands) Net Assets* Net Assets* Net Assets* Assets* Turnover
------------- --------- ------ ---------- -------------- ----------- ----------- ----------- ---------- ---------
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$0.00 $0.00 $ 1.00 2.41% $47,350 0.21% 4.27% 0.92% 3.67% N/A
0.00 0.00 9.41 (0.06)% 151 1.28% 4.68% 2.11% 3.85% 43.63%
0.00 0.00 9.58 (0.68)% 25,405 1.49% 5.36% 1.81% 5.04% 51.80%
0.00 0.00 8.97 (1.32)% 25,581 1.27% 4.20% 1.87% 3.60% 29.14%
0.00 0.00 10.62 1.84% 26,396 1.87% 1.90% 2.06% 1.67% 86.10%
</TABLE>

Aetna Mutual Funds Prospectus 11

<PAGE>

Financial Highlights (continued)
(for one outstanding share throughout each period)

-------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Adviser Class Shares~
Net
Net Asset Realized and Dividends Dividends
Value Net Unrealized Total from from Net in Excess of
Beginning Investment Gain (Loss) Investment Investment Net Investment
of Period Income on Investments Operations Income Income
--------- ---------- -------------- ---------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C>
Growth and Income Fund
Period from April 15, 1994-
October 31, 1994 $10.75 $0.11 $0.30 $0.41 $(0.08) $0.00
Growth Fund
Period from April 15, 1994-
October 31, 1994 10.26 (0.02) 0.50 0.48 0.00 0.00
Small Company Growth Fund
Period from April 15, 1994-
October 31, 1994 10.24 (0.04) 0.15 0.11 0.00 0.00
International Growth Fund
Period from April 15, 1994-
October 31, 1994 11.24 0.01 0.26 0.27 0.00 0.00
Asian Growth Fund
Period from April 15, 1994-
October 31, 1994 8.56 (0.01) 0.91 0.90 0.00 0.00
</TABLE>

~The Company commenced offering Adviser Class shares on April 15, 1994. Prior
to that date, the Company offered only Select Class shares.
*Annualized for periods less than one year.

Per share data calculated using weighted average of shares outstanding during
the period.

The Government Fund, Tax-Free Fund, Growth Fund, Small Company Growth Fund and
Asian Growth Fund commenced operations on January 2, 1994.

Aetna Mutual Funds Prospectus 12

<PAGE>

-------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Ratio of
Ratio of Net
Total Investment
Investment Income
Ratio of Expense Before
Total Ratio of Before Reimburse-
Distributions Net Invest- Net Invest- Reimburse- ment
from Return of Asset Net Assets ment ment ment and Waiver
Realized Capital Value End of Expenses Income to and Waiver to Average
Gain on Distri- End of Total Period to Average Average to Average Net Portfolio
Investments bution Period Return (in thousands) Net Assets* Net Assets* Net Assets* Assets* Turnover
------------- --------- ------ ------- -------------- ----------- ----------- ----------- ---------- ---------
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$0.00 $0.00 $11.08 3.71% $ 5,740 2.32% 1.74% 2.42% 1.65% 54.13%
0.00 0.00 10.74 4.58% 417 1.72% (0.25)% 2.17% (0.71)% 120.32%
0.00 0.00 10.35 0.98% 205 1.78% (0.72)% 2.14% (1.07)% 116.28%
0.00 0.00 11.51 2.40% 26,647 2.27% 0.17% 2.41% 0.02% 81.67%
0.00 0.00 9.46 10.51% 314 1.42% (0.24)% 1.73% (0.55)% 65.50%
</TABLE>

Aetna Mutual Funds Prospectus 13

<PAGE>

Description of the Funds

Each Fund has an investment objective which is a fundamental policy and may not
be changed without the vote of a majority of the holders of that Fund's
outstanding shares. There can be no assurance that the Funds will meet their
investment objectives. Each Fund is subject to investment restrictions
described in this Prospectus and in the SAI, some of which are fundamental
policies. No fundamental investment policy may be changed without shareholder
approval.

A glossary describing various investment terms relating to securities that may
be held by the Funds starts on page 46.

Aetna Money Market Fund

[Description of
Money Market
Fund]

Investment Objective The Money Market Fund seeks to provide high current
return, consistent with preservation of capital and liquidity, through
investment in high-quality money market instruments.

Investment Policy The Money Market Fund invests in U.S. Treasury bills, notes
and bonds; obligations of agencies and instrumentalities of the U.S.
Government; obligations of domestic banks and U.S. dollar denominated
obligations of foreign banks (providing the issuing bank has reported assets in
excess of $5 billion and meets strict capital and profitability criteria),
finance company commercial paper, corporate commercial paper (including
variable-rate instruments), discounted notes of domestic banks, domestic
banker's acceptances eligible for discounting at the Federal Reserve, Yankee
certificates of deposit, Yankee commercial paper, Eurodollar securities,
repurchase agreements, corporate bonds and notes and other debt instruments and
may purchase securities on a when-issued or delayed-delivery basis. All
investments will have a maturity at the time of purchase, as defined under the
federal securities laws, of 397 days or less. Any foreign securities or
obligations will be U.S. dollar denominated.

In addition, the Money Market Fund will invest at least 95% of its total
assets in high-quality securities. High-quality securities are those receiving
the highest credit rating by any two rating agencies (or one, if only one
rating agency has rated the security). High-quality securities may also include
unrated securities if the Investment Adviser determines the security to be of
comparable quality. The remainder of the Money Market Fund's assets will be
invested in securities rated within the two highest rating categories by any
two rating agencies (or one, if only one rating agency has rated the security)
and unrated securities if the Investment Adviser determines the security to be
of comparable quality. With respect to these securities, the Money Market Fund
will not invest more than the greater of 1% of the market value of its total
assets or $1 million in the securities or obligations of any one issuer.

Aetna Mutual Funds Prospectus 14

<PAGE>

The Money Market Fund will use nationally recognized rating agencies such as
Standard & Poor's Corporation and Moody's Investors Service, Inc. when
determining security credit ratings. All investments will be determined to
present minimal credit risks.

The Money Market Fund's dollar weighted average maturity will not exceed 90
days. Although the Investment Adviser will use its best efforts to maintain a
constant net asset value of $1.00 per share, there can be no assurance that the
net asset value will not vary.

Aetna Government Fund

[Description of
Government Fund]

Investment Objective The Government Fund seeks to provide income consistent
with the preservation of capital through investment in securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities.

Investment Policy The Government Fund invests at least 65% of its assets in
direct obligations of the U.S. Government, such as treasury bills, notes and
bonds which are backed by the full faith and credit of the United States, or in
indirect obligations of the U.S. Government, such as notes and bonds which are
guaranteed by agencies and instrumentalities of the U.S. Government. Securities
of such agencies and instrumentalities are backed by either the full faith and
credit of the U.S. Treasury, the right of the issuer to borrow from the U.S.
Treasury, or the credit of the agency or instrumentality. Such agencies and
instrumentalities include, but are not limited to, the Government National
Mortgage Association ("GNMA"), the Federal National Mortgage Association
("FNMA"), the Federal Home Loan Mortgage Corporation ("FHLMC") and the Student
Loan Marketing Association ("SLMA").

The Government Fund may also invest in repurchase agreements collateralized by
U.S. Government agency securities, STRIPs, zero coupon bonds and options and
futures contracts.

Aetna Bond Fund

[Description of
Bond Fund]

Investment Objective The Bond Fund seeks to provide high total return (i.e.,
income and capital appreciation), consistent with reasonable risk, primarily
through investment in a diversified portfolio of high-quality corporate bonds
and securities issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.

Investment Policy The Bond Fund will normally invest at least 65% of its total
assets in high-quality corporate bonds, mortgage-related and other asset-backed
and debt securities, and securities issued or guaranteed by the U.S.
Government, its agencies and instrumentalities. Such securities will be rated
AA or above by Standard & Poor's Corporation, Aa or above by Moody's Investors
Service, Inc., similarly rated

Aetna Mutual Funds Prospectus 15

<PAGE>

by other nationally recognized statistical rating organizations, or be
considered by the Investment Adviser to be of comparable quality. The Fund will
not target any given maturity, thus giving it flexibility to invest in short
and long-term securities as market conditions change. The Bond Fund may also
invest in repurchase agreements, equity securities (not to exceed 5% of total
assets) and securities issued by any foreign corporation or instrumentality or
political subdivision of foreign governments (not to exceed 25% of total
assets). The Bond Fund may also purchase securities on a when-issued or
delayed-delivery basis.

Additionally, the Bond Fund may invest in commercial paper, other short-term
investments, including variable-rate instruments, all having a maturity of less
than one year, debt securities with equity features, convertibles, and straight
debt securities.

The Bond Fund may invest up to 15% of its total assets in high risk high-yield
securities or "junk bonds" (securities rated BB/Ba or below, or if unrated,
considered by the Investment Adviser to be of comparable quality). This will
limit the Fund's ability to earn a higher return which may be associated with
high risk non-investment grade securities. See "Risk Factors and Other
Considerations" for further information.

As of October 31, 1994, the weighted average distribution of bonds in the Bond
Fund based on Standard & Poor's and Moody's bond ratings was 58% in AAA, 12% in
AA, 11% in A, 7% in BBB, 4% in BB, 3% in B and 5% in unrated bonds.

Aetna Tax-Free Fund

[Description of
Tax-Free Fund]

Investment Objective The Tax-Free Fund seeks to provide income exempt from
federal income tax consistent with the preservation of capital primarily
through investment in municipal securities, the interest from which is exempt
from federal income tax.

Investment Policy The Tax-Free Fund will invest at least 80% of its total
assets in municipal securities, the interest from which is exempt from federal
income taxes. This percentage will not include tax-exempt bonds, the interest
from which is a tax preference item for purposes of the federal alternative
minimum tax. There is no limit on the maturity of any individual security. The
Tax-Free Fund may also purchase securities on a when-issued or delayed-delivery
basis and may utilize the full range of tax-exempt securities and their
derivatives. At least 70% of the securities held by the Tax-Free Fund will be
rated A or higher, while not more than 30% will be invested in securities rated
BBB/Baa or of comparable quality (i.e., securities having speculative
characteristics compared to higher rated investment grade securities).

Aetna Mutual Funds Prospectus 16

<PAGE>

In addition, not more than 5% will be unrated and not more than 5% will be
invested in high risk high-yield securities or "junk bonds." The Tax-Free Fund
may invest up to 5% in municipal lease obligations.

The Fund may, for temporary defensive purposes, purchase taxable investments
such as obligations of the U.S. Government, its agencies or instrumentalities,
commercial paper, certificates of deposit and banker's acceptances including
variable-rate instruments, repurchase agree ments on these securities, or any
other fixed income securities that the Investment Adviser considers consistent
with such defensive strategies.

[A special note
for investors in
Tax-Free Fund]

Special Considerations Before investing in a tax-exempt fund, you should decide
whether your after-tax return may be higher with a taxable fund or with a
tax-exempt fund. To compare taxable and tax-free income, you should calculate
the taxable equivalent yield of the investment you are considering, and compare
it with a similar taxable investment. This can be done by using the following
formula:

Tax-exempt yield = Your equivalent taxable yield
-----------------------
100% - Your tax bracket

For example, if you are in a 28% tax bracket and the tax-exempt yield is 8%,
the equivalent taxable yield would be 11.11%.

8% = 11.11% equivalent taxable yield
----------
100% - 28%

In this example, you would choose the tax-free investment if a similar taxable
fund's yield was less than 11.11%.

It is not recommended that the Tax-Free Fund be used as a vehicle for IRAs or
other qualified plans. You should seek advice from your tax advisor regarding
whether an investment in the Tax-Free Fund is appropriate for you.

The Aetna Fund

[Description of
Aetna Fund]

Investment Objective The Aetna Fund seeks to maximize total return with
reasonable safety of principal by investing in a diversified portfolio of
stocks, bonds and money market instruments. The Aetna Fund may involve less
investment risk than a portfolio consisting entirely of common stocks.

Aetna Mutual Funds Prospectus 17

<PAGE>

rate instruments and repurchase agreements, in proportions that reflect the
anticipated returns and risks of each asset class.

The Aetna Fund will not invest more than 15% of the total value of its assets
in high risk high-yield securities, or "junk bonds."
It may buy and sell listed covered put and call options and stock index futures
contracts and related options. The Aetna Fund may also purchase securities on a
when-issued or delayed-delivery basis.

The Investment Adviser employs current market statistics and economic
indicators to forecast returns for each sector of the securities market for the
Aetna Fund. These calculations provide a disciplined framework for assessing
the relative attractiveness of stocks, bonds, and cash equivalents. The
Investment Adviser uses proprietary computer programs to help calculate the
optimal asset exposure over specified time periods for the Aetna Fund.

Special Considerations Investors should be aware that the investment results of
the Aetna Fund partly depend upon the Investment Adviser's ability to
anticipate correctly the relative performance of stocks, bonds and money market
instruments.

While the Investment Adviser has substantial experience in managing all asset
classes, there can be no assurance that the Investment Adviser will always
allocate assets to the best performing sectors. The Aetna Fund's performance
would suffer if a major proportion of its assets were allocated to stocks in a
declining market or, similarly, if a major proportion of its assets were
allocated to bonds at a time of adverse interest rate movement.

Aetna Growth and Income Fund

[Description of
Growth and
Income Fund]

Investment Objectives The Growth and Income Fund seeks long-term growth of
capital and income through investment in a diversified portfolio primarily of
common stocks and securities convertible into common stocks believed to offer
above-average growth potential.

Investment Policies The Growth and Income Fund is expected to invest primarily
in common stocks which have significant potential for capital or income growth.
It may also invest in convertible and nonconvertible preferred stocks, debt
securities, rights and warrants.

Additionally, the Growth and Income Fund may lend portfolio securities, write
and buy listed covered call options and buy and sell listed covered put options
and stock index futures and options. The Growth and Income Fund may also enter
into repurchase agreements with domestic banks and broker dealers, invest up to
25% of its assets in foreign securities, engage in currency hedging and
purchase securities on a when-issued or delayed-delivery basis. The Growth and
Income

Aetna Mutual Funds Prospectus 18

<PAGE>

Fund will not invest more than 15% of the total value of its assets in high
risk high-yield securities or "junk bonds."

Aetna Growth Fund

[Description of
Growth Fund]

Investment Objective The Growth Fund seeks growth of capital through investment
in a diversified portfolio primarily of common stocks and securities
convertible into common stocks believed to offer growth potential.

Investment Policy The Growth Fund will normally invest at least 65% of its
total assets in common stocks which have potential for capital growth. It may
also invest in convertible and non-convertible preferred stocks.

Additionally, the Growth Fund may lend portfolio securities, buy and sell put
and call options, and stock index futures and options. The Growth Fund may also
enter into repurchase agreements, invest up to 25% of its assets in foreign
securities, engage in currency hedging and purchase securities on a
when-issued, delayed delivery or forward commitment basis. The Growth Fund will
not invest more than 15% of the total value of its assets in high risk
high-yield securities or "junk bonds."

Investments of the Growth Fund are selected with the assistance of
computer-aided quantitative analysis and research. However, the Fund's
investments are not solely driven by quantitative techniques and asset
allocation decisions will always remain at the discretion of the Investment
Adviser.

Aetna Small Company Growth Fund

[Description of
Small Company
Growth Fund]

Investment Objective The Small Company Growth Fund seeks growth of capital
primarily through investment in a diversified portfolio of common stocks and
securities convertible into common stocks of companies with smaller market
capitalizations.

Investment Policy The Small Company Growth Fund will normally invest at least
65% of its total assets in the common stock of companies with equity market
capitalizations at the time of purchase of $1 billion or less. The Small
Company Growth Fund may also invest in convertible and non-convertible stocks.

Additionally, the Small Company Growth Fund may lend portfolio securities, buy
and sell put and call options and stock index futures and options. The Small
Company Growth Fund may also enter into repurchase agreements, invest up to 25%
of its assets in foreign securities, engage in currency hedging and purchase
securities on a when issued, delayed delivery or forward commitment basis. The
Small Company Growth Fund will not invest more than 15% of the total value of
its assets in high risk high-yield securities or "junk bonds."

Aetna Mutual Funds Prospectus 19

<PAGE>

Investments for the Small Company Growth Fund are selected with the assistance
of computer-aided quantitative analysis and research. However, the Fund's
investments are not solely driven by quantitative techniques and asset
allocation decisions will remain at the discretion of the Investment Adviser.

Aetna International Growth Fund

[Description of
International
Growth Fund]

Investment Objective The International Growth Fund seeks long-term capital
growth primarily through investment in a diversified portfolio of common stocks
principally traded in countries outside of North America. The International
Growth Fund will not target any given level of current income.

Investment Policy The International Growth Fund will invest at least 65% of its
total assets among securities principally traded in three or more countries
including Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong
Kong, Indonesia, Italy, Japan, Korea, Luxembourg, Malaysia, New Zealand, the
Netherlands, Norway, the Philippines, Singapore, Spain, Sweden, Switzerland,
Taiwan, Thailand, and the United Kingdom.

The International Growth Fund will invest primarily in equity securities but
may invest in convertible and preferred stocks. Further, from time to time the
International Growth Fund may hold up to 10% of its total assets in long-term
debt securities with an equivalent Standard & Poor's Corporation or Moody's
Investors Service, Inc. rating of AA/Aa or above.

The International Growth Fund may enter into forward foreign exchange contracts
or purchase financial futures or options (including options on futures)
as a means to moderate the impact of foreign currency fluctuations. It also may
purchase securities on a when-issued or delayed-delivery basis.

Aetna Asian Growth Fund

[Description of
Asian Growth
Fund]

Investment Objective The Asian Growth Fund seeks long-term growth of capital
primarily through investment in a diversified portfolio of common stocks
principally traded in countries in Asia excluding Japan. The Asian Growth Fund
will not target any given level of current income.

Investment Policy The Asian Growth Fund will invest at least 65% of its total
assets among securities principally traded in China, Hong Kong, India,
Indonesia, Malaysia, Pakistan, the Philippines, Singapore, South Korea, Sri
Lanka, Taiwan, and Thailand.

Aetna Mutual Funds Prospectus 20

<PAGE>

The Asian Growth Fund will invest primarily in equity securities but may
invest in convertible and preferred stocks. In addition, the Asian Growth Fund
may invest up to 10% of its assets in long-term debt securities if the
Investment Adviser believes they will provide superior returns to common
stocks. The Asian Growth Fund may also enter into forward foreign exchange
contracts and purchase financial futures or options, and purchase securities on
a when-issued or delayed-delivery basis.

[A special note
for Investors in
International
Growth Fund
and Asian
Growth Fund]

Special Considerations for International Investors In the last 30 years,
foreign economic growth has frequently outpaced that of the U.S. and returns
from foreign equity investments have often exceeded those on comparable U.S.
securities. The Investment Adviser believes that investment in foreign
securities offers significant potential for long-term capital appreciation and
affords substantial opportunities for investment diversification.

However, investments in securities of foreign companies and in securities de
nominated in foreign currencies involve additional risks not present in U.S.
securities. Please refer to "Risk Factors and Other Considerations" for further
information.

Risk Factors and Other Considerations

General Considerations The different types of securities purchased and
investment techniques used by a Fund involve varying amounts of risk. For
example, equity securities are subject to a decline in the stock market or in
the value of the company and preferred stocks have price risk and some interest
rate and credit risk. The value of debt securities may be affected by changes
in general interest rates and in the credit worthiness of the issuer. Debt
securities with longer maturities (for example, over ten years) are more
affected by changes in interest rates and provide less price stability than
securities with short term maturities (for example, one to ten years). Also, on
each debt security, there is a risk of principal and interest default which
will be greater with higher-yielding, lower-grade securities. High risk,
high-yield securities ("junk bonds") may provide a higher return but with added
risk. In addition, foreign securities have currency risk.

Portfolio Turnover Portfolio turnover refers to the frequency of portfolio
transactions and the percentage of portfolio assets being bought and sold in the
aggregate during the year. The Funds, excluding the Money Market Fund, do not
intend to make a general practice of short-term trading. It is anticipated that
under normal market conditions average annual portfolio turnover rates will not
exceed 100% for the Funds.

Aetna Mutual Funds Prospectus 21

<PAGE>

A high turnover rate will result in increased brokerage commissions and may
increase taxable capital gains. Please see "Taxes" for further information.

Cash or Cash Equivalents All Funds reserve the right to temporarily depart from
their investment objective by investing up to 100% of their assets in cash or
cash equivalents for defense against potential market decline. Such cash
equivalents will be the same type of instruments invested in by the Money
Market Fund.

All the Funds may use the following:

Derivatives In order to manage its exposure to changing interest rates,
securities prices and currency exchange rates, or to increase its investment
return, a Fund may engage in hedging and other strategies using derivatives. A
derivative is a financial instrument whose value depends on (or "derives" from)
the value of an underlying asset, such as a security, interest rate, currency
rate or index. Derivatives which may be used in the Funds include forward
contracts, swaps, structured notes, collateralized mortgage obligations
("CMOs"), futures and options (see below). The risks involved in using
derivatives include the risk that the derivative may experience greater price
swings than other securities and may be less liquid than other securities.
Leveraged derivatives involve borrowing. The Funds may use derivatives as a
hedge against foreign currency, equity market or interest rate risk, or to gain
additional exposure to certain markets for investment purposes, within the
limitations set forth below. In addition, they may be used to enhance a Fund's
yield. For purposes other than hedging, a Fund will invest no more than 5% of
its assets in derivatives which at the time of purchase are considered by
management to involve high risk to the Fund, such as inverse floaters, interest
only ("IO") and principal only ("PO") debt instruments. A Fund (except the Money
Market Fund) may invest up to 30% of its assets in lower risk derivatives for
hedging purposes.

Borrowing A Fund may borrow up to 5% of its total assets from a bank for
temporary or emergency purposes. The Funds do not intend to borrow for other
purposes, except that they may invest in leveraged derivatives which have
certain risks as outlined above.

Repurchase Agreements Under a repurchase agreement, a Fund may acquire a debt
instrument for a relatively short period subject to an obligation by the seller
to repurchase and by the Fund to resell the instrument at a fixed price and
time.

The Funds may enter into repurchase agreements with domestic banks and
broker-dealers. Such agreements, although fully collateral-

Aetna Mutual Funds Prospectus 22

<PAGE>

ized, involve the risk that the seller of the securities may fail to
repurchase them. In that event, a Fund may incur costs in liquidating the
collateral or a loss if the collateral declines in value. If the default on the
part of the seller is due to insolvency and the seller initiates bankruptcy
proceedings, the ability of a Fund to liquidate the collateral may be delayed or
limited.

The Company's Board of Directors has established credit standards for issuers of
repurchase agreements entered into by a Fund.

Asset-Backed Securities The Funds may purchase securities collateralized by a
specified pool of assets, including, but not limited to, automobile loans,
computer leases, boat loans, home equity loans, mobile home loans, recreational
vehicles or credit card receivables. These securities are subject to prepayment
risk. In periods of declining interest rates, reinvestment would thus be made
at lower and less attractive rates.

Bank Obligations The Funds may invest in obligations issued by domestic banks
or foreign banks (including bankers' acceptances, time deposits and
certificates of deposit) provided the issuing bank has a minimum of $5 billion
in assets and a primary capital ratio of at least 4.25%.

Illiquid and Restricted Securities A Fund may invest up to 15% of its total
assets in illiquid securities (10% in the case of the Money Market Fund).
Illiquid securities are securities that are not readily marketable or cannot be
disposed of promptly within seven days in the ordinary course of business
without taking a materially reduced price. In addition, a Fund may invest in
securities that are subject to legal or contractual restrictions as to resale,
including securities purchased under Rule 144A and Section 4(2) of the
Securities Act of 1933. The Board of Directors has established a policy to
determine the liquidity of such securities.

All Funds except the Tax-Free Fund
may also use the following:

Foreign Securities The purchase of foreign securities may involve certain
additional risks. Such risks include: currency fluctuations and related
currency conversion costs; less liquidity; price or income volatility; less
government supervision and regulation of foreign stock exchanges, brokers and
listed companies; possible difficulty in obtaining and enforcing judgments
against foreign entities; adverse foreign political and economic developments;
different accounting procedures and auditing standards; the possible imposition
of withholding taxes on interest income payable on securities; the possible
seizure or nationalization of foreign assets; the possible establishment of
exchange con-

Aetna Mutual Funds Prospectus 23

<PAGE>

trols or other foreign laws or restrictions which might adversely affect the
payment and transferability of principal, interest and dividends on securities;
higher transaction costs; possible settlement delays; and less publicly
available information about foreign issuers.

All Funds except the Money Market Fund
may also use the following:

Futures Contracts A Fund may enter into futures contracts or options on futures
to manage the risk of changes in interest rates, equity prices, currency
exchange rates or in anticipation of future purchases or sales of securities.

Certain risks are involved in futures contracts, including but not limited to:
no assurance that futures contracts transactions can be effected at favorable
prices; possible reduction in a Fund's total return and yield; possible
reduction in value of the futures instrument; the inability of a Fund to limit
losses by closing its position due to lack of a liquid secondary market or due
to daily limits of price fluctuation; imperfect correlation between the value of
the contracts and the related securities; and potential losses in excess of the
amount invested in the futures contracts themselves.

The use of futures involves a high degree of leverage because of the low margin
requirements. As a result, small price movements in futures contracts may result
in immediate and potentially unlimited losses or gains to a Fund. The amount of
gains or losses on investments in futures contracts depends on the portfolio
manager's ability to predict correctly the direction of stock prices, interest
rates and other economic factors.

Options Options are used to minimize principal fluctuation or to generate
additional premium income but they do involve risks. Writing call options, for
example, involves the risk of not being able to effect closing transactions at
favorable prices or to participate in the appreciation of the underlying
securities. Purchasing put options involves the risk of losing the entire
purchase price of the option.

All Funds except the Money Market Fund,
Government Fund, International Growth Fund,
and Asian Growth Fund may also use the following:

High-Yield Securities A Fund may invest in high risk high-yield securities,
often called junk bonds. These securities are rated BB/Ba or below, or, if
unrated, considered by the Investment Adviser to be of comparable quality. The
Funds will not invest in high-yield securities rated below B (securities with
the capacity to meet interest and princi-

Aetna Mutual Funds Prospectus 24

<PAGE>

pal payments but with greater vulnerability to default). These securities tend
to offer higher yields than investment-grade bonds because of the additional
risks associated with them. These risks include: a lack of liquidity; an
unpredictable secondary market; a greater likelihood of default; increased
sensitivity to difficult economic and corporate developments; call provisions
which may adversely affect investment returns; and loss of the entire principal
and interest.

Although junk bonds are high risk investments, the Investment Adviser may
purchase these securities if they are thought to offer good value. This may
happen if, for example, the rating agencies have, in the Investment Adviser's
opinion, misclassified the bonds or overlooked the potential for the issuer's
enhanced creditworthiness.

The Government Fund, Bond Fund,
Tax-Free Fund and the Aetna Fund
may also use the following:

Mortgage-Backed Securities A Fund may invest in mortgage-backed and other
pass-through securities. Payments of interest and principal on these securities
may be guaranteed by an agency or instrumentality of the U.S. Government such
as the GNMA, the FHLMC and the FNMA. These securities represent part ownership
of a pool of mortgage loans where principal is scheduled to be paid back by the
borrower over the length of the loan rather than returned in a lump sum at
maturity. A Fund may also invest in private mortgage pass-through securities
backed by pools of conventional fixed-rate or adjustable-rate mortgage loans.
In addition, a Fund may invest in CMOs and securities issued by real estate
mortgage investment conduits ("REMICs"). Mortgage-backed securities are also
subject to the same prepayment risk as asset-backed securities.

The Tax-Free Fund may also use the following:

Municipal Securities Municipal securities are debt obligations issued by state
and local governments or any of their political subdivisions, agencies and
instrumentalities. Municipal securities are both municipal bonds (those
securities with maturities of five years or more) and municipal notes
(securities with maturities of less than five years). Interest on these
securities is exempt from federal income taxes and, in some instances, from
state or local income taxes. Municipal securities are issued to obtain funds
for a variety of reasons: to construct public facilities, to refund outstanding
debt obligations, and to pay various operating expenses. They may also be
issued to finance certain privately operated activities, such as airports,
housing, and water, gas and sewage works.

Aetna Mutual Funds Prospectus 25

<PAGE>

Municipal securities have many of the same risks as other debt securities,
with the additional risk that there may be less information about the financial
condition of an issuer of municipal securities than would be available for
corporations whose securities are publicly traded.

Municipal lease obligations may take the form of a lease or an installment
purchase contract issued by a state or local government authority to obtain
funds to acquire a wide variety of equipment and facilities. Some municipal
lease securities may be deemed to be "illiquid."

Although the Tax-Free Fund may invest in municipal securities which it
believes are exempt from federal income tax at the time of purchase, it cannot
guarantee the tax exempt status of the income earned.

Alternative Minimum Tax The Tax-Free Fund may invest in certain municipal bonds
the interest from which is a tax preference item for purposes of the federal
alternative minimum tax. If you are subject to the federal alternative minimum
tax, a portion of your income distributions that are exempt from the regular
federal income tax may not be exempt from the alternative minimum tax. You
should discuss your tax situation with your tax advisor.

The Aetna Fund, Growth and Income Fund,
Growth Fund and Small Company Growth Fund
may also use the following:

Small Capitalization Companies These companies may be in an early developmental
stage or older companies entering a new stage of growth due to management
changes, new technology, products or markets. They may also be undervalued due
to poor economic conditions, market decline or actual or anticipated
unfavorable developments affecting the issuer of the security or its industry.

Securities of small capitalization companies tend to offer greater potential for
growth than securities of larger, more established issuers but there are
additional risks associated with them. These risks include: limited
marketability; more abrupt or erratic market movements than securities of
larger capitalization companies; and less publicly available information about
the issuer. In addition, these companies may be dependent on relatively few
products or services, have limited financial resources and lack of management
depth, and may have less of a track record or historical pattern of
performance.

Investment Restrictions

A Fund will not concentrate its investments in any one industry except that a
Fund may invest up to 25% of its total assets in securities issued

Aetna Mutual Funds Prospectus 26

<PAGE>

by companies principally engaged in any one industry. For purposes of this
restriction, finance companies will be classified as separate industries
according to the end users of their services, such as automobile finance,
computer finance and consumer finance. This limitation will not apply to
securities issued or guaranteed by the U.S. Government, its agencies and
instrumentalities and in the case of the Money Market Fund, to securities
invested in, or repurchase agreements for, U.S. Government securities, and
certificates of deposit, bankers' acceptances, or securities of banks and bank
holding companies. Also, a Fund will not invest more than 5% of its total
assets in the securities of any one issuer (excluding securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities) or
purchase more than 10% of the outstanding voting securities of any one issuer.
This restriction applies only to 75% of a Fund's total assets. See the SAI for
additional restrictions.

Shareholder Services

The Company offers several services to its Fund shareholders. These may be
chosen from the Application.

These services may not be available through employer-sponsored retirement
plans. For information on services that are available under employer-sponsored
retirement plans, such as 401(k) plans, please refer to your enrollment
material. The specific provisions of your plan will govern the investment
options and services available to you.

Shareholder Inquiries If you have any questions about the Funds or the
shareholder services described below, please call your representative or
1-800-367-7732.

[How to
Purchase
Shares]

How to Purchase Shares Adviser Class shares may be purchased directly from the
Company, through a registered representative of a broker-dealer affiliated with
the Company, through a registered representative of an unaffiliated
broker-dealer, or through an employer-sponsored retirement plan (if you are
purchasing through such a plan, please refer to your enrollment materials).

How to Open an Account To open an account, please complete and submit an
Application with the amount to be invested. You may open an account with a
minimum investment of $1,000 or $500 for IRAs. Minimum investments may be
waived if an investment is made through exchange of the entire amount invested
in another Fund. Minimums may also be waived for certain circumstances such as
for per-

Aetna Mutual Funds Prospectus 27

<PAGE>

sons investing through certain benefit plans, insurance settlement options or
by systematic investments. (Please refer to "Other Features-Systematic
Investment.")

Crediting of Shares If Firstar Trust Company (the transfer agent) receives a
completed and signed Application, accompanied by a check in payment for the
shares, at its Milwaukee offices prior to 4:00 p.m. Eastern time on any day
that the New York Stock Exchange is open for business (Business Day), the
Adviser Class shares will be purchased at the net asset value determined as of
4:15 p.m. on that date. Orders received after 4:00 p.m. will be processed at
the net asset value determined on the following Business Day. For investors
purchasing shares in connection with retirement plans offered by certain
institutions (Institutions) under Section 401 of the Internal Revenue Code,
shares will be purchased at the next price calculated on a day the NYSE is open
provided that the Institution receives the investor's request before the time
specified by such Institution. Investors participating in such a plan should
refer to their enrollment materials for a discussion of any specific
instructions on the timing or restrictions on the purchase of shares. Please
refer to "Net Asset Value" for information on how the Funds are valued.

No initial sales charge is imposed at the time of purchase. A CDSC is imposed,
however, on certain redemptions of Adviser Class shares. See "Fees and
Charges-Contingent Deferred Sales Charge" which describes the CDSC in greater
detail.

Once you have opened an account in a Fund, additional investments may be made
by mail ($100 minimum), wire transfer ($500 minimum) or exchange from the same
class of another Fund in the Aetna Series Fund, Inc.

All checks must be drawn on a bank located within the United States and
payable in U.S. dollars.

[You can make
a purchase
by mail]

Purchase by Mail To purchase shares by mail, please complete and sign the
Application, make a check payable to the Aetna Series Fund, Inc. and return
both to your agent or representative.

You can make additional investments to your accounts by using the investment
stubs from your confirmation statements or by letter. Your letter should
indicate your name, account numbers, the Adviser Class shares of which Funds
you wish to invest in, and the amount to be invested. Letters should be mailed
to the transfer agent as follows:

Aetna Series Fund, Inc.
c/o Mutual Fund Services, 3rd Floor,
P.O. Box 701,
Milwaukee, WI 53201-0701.

Aetna Mutual Funds Prospectus 28

<PAGE>

When opening an account, your check should be made payable to Aetna Series
Fund, Inc. or Firstar Trust Company. Cash, credit cards and third party checks
cannot be used to open an account. Firstar will accept checks for subsequent
purchases which are made payable to the account owner(s).

[You can
purchase by
wire, electronic
funds transfer
or exchange]

Purchase by Wire If you have an account in a Fund you may purchase additional
Adviser Class shares of that Fund by wire. For federal funds wire instructions,
please call 1-800-367-7732. Federal funds wire purchase orders will be accepted
only when the Fund and custodian bank are open for business.

Purchase by Electronic Funds Transfer Once an account has been established in
any of the Funds, you may wish to make additional purchases of Adviser Class
shares by using Electronic Funds Transfer ("EFT") facilities under the
Systematic Investment feature. This will allow you to transfer money between a
bank account and a specific Fund. The appropriate election must be made on the
Application to authorize this option.

Purchase by Exchange You may open an account or purchase additional shares by
making an exchange between Adviser Class shares of Aetna Series Fund, Inc.
without charge. See "Other Features" for automatic exchange privileges. An
exchange may be made by submitting a letter requesting the exchange and
specifying the name and account number of your current Fund account, the name
of the Fund you wish to exchange into, the amount to be exchanged, and the
signatures of all shareholders. Send your request to the transfer agent as
follows:

Aetna Series Fund, Inc.
c/o Mutual Fund Services, 3rd Floor
P.O. Box 701
Milwaukee, WI 53201-0701

You may exchange your Adviser Class shares by calling 1-800-367-7732. Please
provide the Fund names, account number, your Social Security number or taxpayer
identification number, account address and the amount to be exchanged. Requests
received prior to 4:00 p.m. Eastern time will be processed that business day.

You should carefully consider the following before making an exchange:

* Each exchange may result in a gain or loss and is treated as a sale and as a
purchase of shares for tax purposes.

* An exchange which represents an initial investment in a Fund must meet the
minimum investment requirements.

Aetna Mutual Funds Prospectus 29

<PAGE>

* The shares received in an exchange must be identically registered. A letter
with signature guarantees must accompany any exchange request to transfer
shares into a Fund account that is not registered identically to the
transferring Fund account.

* Following an investment in a Fund, there is a required eight-day holding
period before those shares can be exchanged.

There is currently no limit on the number of exchanges. However, each Fund
reserves the right to temporarily or permanently terminate the exchange
privilege for any person who makes more than five exchanges out of a Fund per
calendar year. In addition, each Fund reserves the right to refuse exchange
purchases by any person or group if, in the Investment Adviser's judgment, that
Fund would be unable to invest effectively in accordance with its investment
objective as a result of such exchange. Each Fund also reserves the right to
revise the exchange privilege at any time.

You automatically receive telephone exchange privileges when you establish your
account. If you do not want telephone exchange privileges, write to the transfer
agent at the above address or call 1-800-367-7732. The Funds will employ
reasonable procedures to confirm that instructions received are genuine. If the
Funds do not follow those procedures, they may be liable for any losses due to
unauthorized or fraudulent instructions. For your protection, all telephone
exchange transactions will be recorded, and you will be asked for certain
identifying information.

[Your distribution
option can be
changed at any
time by calling
1-800-367-7732]

Distribution Options When completing an Application, you must select one of the
following options:

* Full Reinvestment - Both dividends and capital gains distributions from a
Fund will be reinvested in additional Adviser Class shares of that Fund. This
option will be selected automatically unless one of the other options is
specified. (Please refer to "Fund Distributions".)

* Or . . . Capital Gains Reinvestment - Capital gains distributions from a
Fund will be reinvested in additional Adviser Class shares of that Fund and
all net income dividends will be distributed in cash.

* Or . . . All Cash - Dividends and capital gains distributions will be paid in
cash.

If a cash distribution option is selected you can elect to have distributions
automatically invested in Adviser Class shares of another Fund of Aetna Series
Fund, Inc.

Aetna Mutual Funds Prospectus 30

<PAGE>

How to Redeem Shares To redeem all or a portion of the Adviser Class shares in
your account, a redemption request should be submitted as described below.
Shares will be redeemed at the net asset value next determined after receipt of
the redemption request by the transfer agent. Redemptions received by 4:00 p.m.
Eastern time will be processed at the net asset value determined as of 4:15
p.m. on that date if all required documentation is received by the transfer
agent by 4:00 p.m. Redemption requests received after 4:00 p.m. will be
processed at the net asset value determined on the following business day.
Redemptions may be subject to a contingent deferred sales charge. See Fees and
Charges for more information.

[For help with
redemptions, call
your agent
or representative
or 1-800-367-7732]

Redeem by Mail Shares of any Fund may be redeemed by sending a letter of
instruction to the transfer agent identifying the Fund, the number of shares or
dollar amount to be redeemed, your name and the Fund account number. The letter
of instruction must be signed by all person(s) required to sign for the Fund
account, exactly as it is registered, and accompanied by a signature
guarantee(s). Certain nonindividual shareholders may also be required to
furnish copies of a corporate resolution, trust document or other supporting
documents.

Once shares are redeemed, the relevant Fund will normally send the proceeds of
such redemption within one or two business days. However, if making immediate
payment could adversely affect a Fund, the Fund may defer distribution for up to
seven days or the maximum period allowed by law, if shorter. Also, a Fund will
hold payment of redemption proceeds until a purchase check or systematic
investment clears, which may take up to 12 calendar days. The Fund(s) may
suspend redemptions or postpone payments when the New York Stock Exchange is
closed or when trading is restricted for any reason other than its customary
weekend or holiday closings, or under any emergency circumstances as determined
by the Commission.

Redeem by Wire Redemption proceeds will be transferred by wire to your
designated bank account if federal funds wire instructions are provided with
your signature guaranteed letter of redemption. A $7.50 fee will be charged for
this service. A minimum redemption of $1,000 is required for wire transfers.

Signature Guarantee The Funds will waive the signature guarantee requirement
for redemption requests for amounts of $10,000 or less. However, if you wish to
have your redemption proceeds transferred by wire to your designated bank
account, paid to someone other than the shareholder of record, or sent
somewhere other than the shareholder address of record, you must provide a
signature guarantee with your written redemption instructions regardless of the
amount of redemption.

Aetna Mutual Funds Prospectus 31

<PAGE>

The Funds reserve the right to amend or discontinue this waiver of signature
guarantee policy at any time and establish other criteria for verifying
redemption request authenticity.

Any one of the following institutions may provide a signature guarantee: a
national or state bank (or savings bank in New York or Massachusetts only); a
trust company; a federal savings and loan association; or a member firm of the
New York, American, Boston, Midwest, or Pacific Stock Exchange. Please note
that signature guarantees are not provided by notary publics.

[Information you
will receive]

Minimum Account Balance To keep your account open, you must maintain a minimum
balance of $500 in each Fund account. If this minimum balance is not maintained
due to redemptions, the Fund reserves the right to redeem all of your remaining
shares in that account and mail the proceeds to you at the address of record.
Shares will be redeemed at net asset value on the day the account is closed.
The Fund will give you 60 days notice that such redemption will occur unless
you make an additional investment to increase the account balance to the $500
minimum.

Tax-Deferred Retirement Plans Aetna Series Fund can be used for investment by a
variety of tax-deferred plans. These plans let you save for retirement and can
defer taxes on your investment income. Some of these plans are:

* IRAs, available to individuals who work and their spouses.

* 401(k) Programs, available to corporations of all sizes to benefit their
employees.

Shareholder Information The transfer agent will maintain shareholder accounts.
A confirmation statement is sent to you and your agent or representative after
every transaction that affects your share balance or account registration. A
Form 1099 will also be sent each year by January 31. You will also receive an
annual and semiannual report of the Funds. The transfer agent may charge you a
fee for special reports such as an historical transcript of your account.

Consolidated Statements, reflecting current account values and year-to-date
transactions, will be sent each quarter. All accounts identified by the same
social security number and address will be consolidated. For example, you could
receive a Consolidated Statement showing your individual and IRA accounts.
Annual and semiannual reports will also be consolidated on this basis. With the
prior permission of the other shareholders involved, you have the option of
requesting that accounts controlled by those other shareholders be shown on one
Consolidated Statement. For example, information on your individual account,
your IRA, your spouse's individual account and your spouse's IRA may be shown on
the Consolidated Statement.

Aetna Mutual Funds Prospectus 32

<PAGE>

Other Features

[A convenient way
to make regular
investments]

Systematic Investment The Systematic Investment feature, using the EFT
capability, allows you to make automatic monthly investments in any of the
Funds. You may select, on the Application, the amount of money to be moved and
the Fund to be invested in. There is no minimum initial cash investment
required to open your account. However, the minimum monthly Systematic
Investment is $50 per Fund account. Your application must be received at least
15 business days prior to the first EFT transaction. The Systematic Investment
feature and EFT capability will be terminated upon total redemption of your
account. Also, a Fund will hold payment of redemption proceeds until a
Systematic Investment has cleared, which may take up to 12 calendar days.

[For more informa-
tion, call your
agent or represen-
tative or 1-800-367-7732.]

Automatic Cash Withdrawal Plan The Automatic Cash Withdrawal Plan provides a
convenient way for you to receive a systematic distribution while maintaining
an investment in the Funds. The Automatic Cash Withdrawal Plan permits you to
have payments of $100 or more automatically transferred from your account(s) in
the Fund(s) to your designated bank account on a monthly basis. In order to
start this plan, you must have a minimum balance of $10,000 in any Fund account
utilizing this feature. Your automatic cash withdrawals will be processed on a
regular basis beginning on or about the 1st day of the month. There may be tax
consequences associated with these transactions. Please consult your tax
adviser.

[Be sure to
sign up for
checkwriting
services]

Checkwriting Service Checkwriting is available with the Money Market Fund and
any applicable CDSC will be charged to your account. Checks must be for a
minimum of $250. The checkwriting service may not be used for a complete
redemption of your account. If the amount of the check including any applicable
CDSC is greater than the value of your account, the check will be returned
unpaid. In addition, checks written against shares purchased by check or
Systematic Investment in the past 12 calendar days will be returned unpaid due
to uncollected funds. The option for this service is included on the
Application. All notices with respect to checks must be given to the transfer
agent. The checkwriting service is not available for IRAs or other retirement
accounts.

TDD Service Firstar Trust Company, the transfer agent, offers
Telecommunication Device for the Deaf (TDD) services for hearing impaired
shareholders. The dedicated number for this service is 1-800-684-3416 and
appears on shareholder account statements.

Aetna Mutual Funds Prospectus 33

<PAGE>

Changes to Service The Funds reserve the right to amend the shareholder
services or to change the terms or conditions.

Cross-Fund Investing

* Dividend Investing - You may elect to have dividend and/or capital gains
distributions automatically invested in one other Adviser Class Fund account.

* Systematic Exchange - You may establish an automatic exchange of Adviser
Class shares from one Fund account to another. The exchange will occur on or
about the 15th day of each month and must be for a minimum of $50 per month.
As this transaction is treated as an exchange, the policies related to the
exchange privilege apply. Please read the "Shareholder Services-Purchase by
Exchange" section carefully. There may be tax consequences associated with
these exchanges. Please consult your tax advisor.

Cross-Fund Investing may only be made in a Fund account that has been
previously established with the Fund's minimum investment. To request either or
both of these features, please call your agent or representative, or call
1-800-367-7732.

Fees and Charges

Shareholder Services Fee Under a Shareholder Services Plan approved by the
Board of Directors, ALIAC is paid a service fee at an annual rate of 0.25%
(0.10% for the Money Market Fund) of the daily net assets of the Adviser Class
shares of each Fund. This fee is used as compensation for expenses incurred in
servicing shareholder accounts.

12b-1 Distribution Fee The Board of Directors and the Adviser Class
shareholders have approved a Distribution Plan under Rule 12b-1 of the 1940
Act. Under this plan ALIAC is paid a 12b-1 distribution fee at an annual rate
of 0.50% of the average daily net assets of the Adviser Class shares of each
Fund except the Money Market Fund.

The 12b-1 distribution fee may be used to cover expenses incurred in promoting
the sale of Adviser Class shares, including (i) costs of printing and
distributing each Funds' prospectus, SAI and sales literature to prospective
investors; (ii) payments to registered representatives and other persons who
provide support services in connection with the distribution of shares; (iii)
overhead and other ALIAC distribution related expenses; and (iv) accruals for
interest on the amount of the foregoing expenses that exceed 12b-1 distribution
fees and the CDSC received by ALIAC.

Aetna Mutual Funds Prospectus 34

<PAGE>

[How we calculate
the deferred sales
charge]

Contingent Deferred Sales Charge You may buy Adviser Class shares of any Fund
without an initial sales charge. However, ALIAC will impose a contingent
deferred sales charge (CDSC) on certain Fund share redemptions.

There is no CDSC on redemptions of Adviser Class shares purchased through
reinvestment of dividends or capital gains distributions or shares purchased
more than four years prior to the redemption. Redemptions of Adviser Class
shares within four years of purchase are subject to a CDSC. The charge is
assessed on an amount equal to the lesser of the current market value or the
original cost of the shares being redeemed. The result is there is no sales
charge on increases in the net asset value of shares above the initial purchase
price. In addition, there is no CDSC on Money Market Fund redemptions unless
those shares were purchased through an exchange from another Fund within four
years prior to the redemption.

The CDSC is calculated by multiplying the redemption proceeds by the
percentage shown below based on the time invested:

Redemption During CDSC
----------------------- -----
1st year since purchase 1.00%
2nd year since purchase .75%
3rd year since purchase .50%
4th year since purchase .25%
5th year and thereafter None

When you request a redemption of Adviser Class shares, to determine whether
the CDSC is applicable, the Company will assume that you are redeeming shares
not subject to the CDSC first. In determining the number of years the shares
have been held, each Fund will aggregate all purchases of Adviser Class shares
made during a month and consider them made on the first day of the month.

For example, assume that you have made purchase payments for Adviser Class
shares of a Fund of $2,000 annually for 2 years (total $4,000) and that the
value of your investment, including appreciation and reinvested distributions,
has grown to $5,200 in the third year. Since there is no CDSC on appreciation
or reinvested dividends, you could redeem $1,200 without incurring a charge.
For a redemption of $2,000, the first $1,200 would not be subject to a CDSC,
but the remaining $800 would be subject to the CDSC and would be assumed to
have come from your oldest purchase payment. Thus, a 0.50% CDSC would be
imposed (for redemptions of shares in the third year since purchase), for a
total charge of $4.00.

Because the CDSC is assessed on a fund-by-fund basis, shareholders who
contemplate a redemption and have invested in multiple Funds

Aetna Mutual Funds Prospectus 35

<PAGE>

should consider redeeming from the Fund that would produce the lowest CDSC.

Waivers of CDSC The CDSC will be waived on (a) exchanges; (b) redemptions of
shares following the death or disability of the shareholder; (c) redemptions of
shares in connection with distributions and withdrawals from retirement plans
or IRAs; (d) redemptions of shares purchased by active or retired employees of
the Underwriter or affiliated companies; (e) redemptions by shareholders with a
current account balance of $1 million or more in the account from which they
wish to redeem; and (f) involuntary redemptions.

Management of the Funds

Directors The business affairs of each Fund are managed under the direction of
the Board of Directors (Directors). The Directors set broad policies for the
Company and each Fund. Information about the Directors is found in the SAI.

[Your Investment
Adviser]

Investment Adviser ALIAC, the Investment Adviser for each Fund, is a
Connecticut corporation with its principal offices at 151 Farmington Avenue,
Hartford, Connecticut 06156. The Investment Adviser is registered with the
Commission as an investment adviser and in addition to managing the Funds,
provides investment advisory services to other investment companies and for its
general account, all of which together hold over $6 billion in assets. The
Investment Adviser is a wholly owned subsidiary of Aetna Life and Casualty
Company which, with affiliated companies, comprises one of the world's leading
providers of insurance and financial services.

Under an investment advisory agreement, the Investment Adviser is, subject to
the supervision of the Directors, responsible for managing the assets of each
Fund in accordance with its investment objectives and policies.

The Investment Adviser furnishes all necessary facilities and pays the
salaries and other related costs of personnel engaged in providing investment
advice to the Company. It also pays salary, other fees and expenses for
Directors and officers of the Company who are employees or affiliated persons
of the Investment Adviser.

Aetna Mutual Funds Prospectus 36

<PAGE>

[Advisory
Fees]

The Investment Adviser receives a monthly fee from each Fund at an annual rate
based on average daily net assets of each Fund as follows:

Fee Assets
---------------------------------------------------
Money Market Fund 0.400% On first $500 million
0.350% On next $500 million
0.340% On next $1 billion
0.330% On next $1 billion
0.300% Over $3 billion
---------------------------------------------------
Government Fund 0.500% On first $250 million
0.475% On next $250 million
0.450% On next $250 million
0.425% On next $1.25 billion
0.400% Over $2 billion
---------------------------------------------------
Bond Fund 0.500% On first $250 million
0.475% On next $250 million
0.450% On next $250 million
0.425% On next $1.25 billion
0.400% Over $2 billion
---------------------------------------------------
Tax-Free Fund 0.500% On first $250 million
0.475% On next $250 million
0.450% On next $250 million
0.425% On next $1.25 billion
0.400% Over $2 billion
---------------------------------------------------
Aetna Fund 0.800% On first $500 million
0.750% On next $500 million
0.700% On next $1 billion
0.650% Over $2 billion
---------------------------------------------------
Growth and Income Fund 0.700% On first $250 million
0.650% On next $250 million
0.625% On next $250 million
0.600% On next $1.25 billion
0.550% Over $2 billion
---------------------------------------------------
Growth Fund 0.700% On first $250 million
0.650% On next $250 million
0.625% On next $250 million
0.600% On next $1.25 billion
0.550% Over $2 billion

Aetna Mutual Funds Prospectus 37

<PAGE>

Fee Assets
------------------------------------------------------
Small Company Growth Fund 0.850% On first $250 million
0.800% On next $250 million
0.775% On next $250 million
0.750% On next $1.25 billion
0.725% Over $2 billion
------------------------------------------------------
International Growth Fund 0.850% On first $250 million
0.800% On next $250 million
0.775% On next $250 million
0.750% On next $1.25 billion
0.700% Over $2 billion
------------------------------------------------------
Asian Growth 1.000% On first $250 million
0.875% On next $250 million
0.850% On next $250 million
0.825% On next $1.25 billion
0.800% Over $2 billion

The above investment advisory and administrative service fees, when taken
together, applicable to (before expense reimbursement) the Aetna Fund, Growth
and Income Fund, Growth Fund, Small Company Growth Fund, International Growth
Fund and Asian Growth Fund are higher than those charged by some other
investment advisers to other registered investment companies.

[Sub-advisers to
Aetna Series Fund,
Inc.]

Under Sub-advisory Agreements with the Investment Adviser, the sub-advisers
are subject to the supervision of the Investment Adviser and the Directors, and
are responsible for managing the assets of each respective Fund in accordance
with its investment objective and policies. The sub-advisers pay the salaries
and other related costs of personnel engaged in providing investment advice
including office space, facilities and equipment.

Aetna Mutual Funds Prospectus 38

<PAGE>

The Investment Adviser has overall responsibility for monitoring the
investment program maintained by the sub-advisers for compliance with
applicable laws and regulations and the respective Fund's investment objective.

Administrator ALIAC acts as administrator for each Fund and performs certain
administrative and internal accounting services, including maintaining general
ledger accounts, regulatory compliance, preparation of financial information
for semiannual and annual reports, preparing registration statements,
calculating net asset values (except for the International Growth and Asian
Growth Funds), shareholder communications and supervision of the custodians and
transfer agent.

For these services, each Fund pays ALIAC a monthly fee at an annual rate based
on average daily net assets as follows: 0.25% on the first $250 million, 0.24%
on the next $250 million, 0.23% on the next $250 million, 0.22% on the next
$250 million, 0.20% on the next $1 billion and 0.18% on assets over $2.0
billion.

Principal Underwriter ALIAC is the principal underwriter for the Company. ALIAC
may contract with various broker-dealers, including one or more affiliates, for
distribution of Adviser Class shares. ALIAC may also sell shares of the Funds
directly. ALIAC is paid an annual service fee and an annual 12b-1 distribution
fee with respect to Adviser Class shares for all Funds (except the Money Market
Fund). The fees are authorized under a Shareholder Services Plan and a
Distribution Plan (Plans) adopted by the Board of Directors with respect to the
Adviser Class shares of each Fund. See "Fees and Charges" for more information.

Although it is anticipated that some promotional activities will be conducted
on a Company-wide basis, payments made by a Fund under the Distribution Plan
generally will be used to finance the distribution of shares of that Fund.
Expenses incurred in connection with Company-wide activities may be allocated
pro-rata among all Funds of the Company on the basis of their relative net
assets.

Payments under the Plans are not tied exclusively to the distribution and
shareholder service expenses actually incurred by ALIAC, and the payments may
exceed expenses actually incurred. The Company's Board of Directors evaluates
the appropriateness of the Plans and the payment terms on a continuing basis
and in doing so will consider all relevant factors, including expenses borne by
ALIAC and the amounts received under the Plans and the proceeds of the CDSC.

On a quarterly basis, the Company's Board of Directors reviews a report on
expenditures under the Plans and the purposes for which those expenditures were
made. The Directors conduct an additional,

Aetna Mutual Funds Prospectus 39

<PAGE>

more extensive review annually in determining whether the Plans will be
continued. By their terms, continuation of the Plans from year to year is
contingent on annual approval by a majority of the Company's Directors and by a
majority of the Directors who are not "interested persons" as defined in the
1940 Act, and who have no direct or indirect financial interest in the
operation of the Plans or related agreements (the "Plan Directors"). The
Distribution Plan may be terminated by the Plan Directors or a majority of the
outstanding shares of the Funds. The Shareholder Services Plan may be
terminated by the Directors.

Transfer Agent Firstar Trust Company acts as each Fund's transfer and
dividend-paying agent. Firstar is responsible for the issuance, transfer and
redemption of shares and the opening and maintenance of shareholder accounts.

Fund Expenses Each Fund bears the costs of its operations. Expenses directly
attributable to a Fund are charged to that Fund. Some expenses are allocated
proportionately among all the Funds in relation to the net assets of each Fund
and some expenses are allocated equally to each Fund.

Portfolio Management

The following individuals are primarily responsible for the day-to-day
management of the Funds, as indicated below. All of the following individuals
may also decide as a group what strategy may benefit all of the Funds.

Money Market Fund, Government Fund and Bond Fund Jeanne Wong-Boehm, Managing
Director, ALIAC. Ms. Wong-Boehm has been with ALIAC since 1982 and has over 10
years of investment experience.

Tax-Free Fund Neil Grabowski, Managing Director, Aeltus. Mr. Grabowski has been
with Aetna since 1982 and has over 12 years experience managing tax-exempt
securities.

Aetna Fund John Y. Kim, Chief Investment Officer, ALIAC. Mr. Kim joined ALIAC
in May 1994. Mr. Kim has over 10 years of investment management experience with
ALIAC, an affiliate of ALIAC, and Mitchell Hutchins Institutional Investors,
Inc.

Growth and Income Fund Martin J. Duffy, Portfolio Manager, ALIAC. Mr. Duffy has
been with ALIAC since 1972 and has over 20 years of investment experience.
Vince Fioramonti, who is responsible for Hong Kong transactions for this Fund,
has been with Aetna since 1994 and has over 7 years of international investment
experience.

Aetna Mutual Funds Prospectus 40

<PAGE>

Growth Fund Peter B. Canoni, Managing Director, Aeltus. Mr. Canoni has been
with Aetna since 1980 and has over 20 years of investment experience.

Small Company Growth Fund Thomas J. DiBella, Investment Officer, Aeltus. Before
joining Aeltus, Mr. DiBella was Investment Officer at Bethlehem Steel from 1989
to 1991. Mr. DiBella has over 10 years of investment experience.

International Growth Fund Douglas A. Thomson, Dunedin Fund Managers, Ltd.,
began managing the Fund May 1, 1994. Mr. Thomson has 9 years of investment
experience with Dunedin.

Asian Growth Fund Anna Tong, Managing Director, Aeltus Far East. Ms. Tong has
been with Aetna since 1985 and has over 10 years of Asian investment
experience.

Fund Distributions

[How to
receive
dividends]

* The Money Market Fund declares dividends daily and pays monthly.
* The Government Fund, the Bond Fund and the Tax-Free Fund declare and pay
dividends monthly.
* The Aetna Fund and the Growth and Income Fund declare and pay dividends
semiannually.
* The Growth Fund, Small Company Growth Fund, International Growth Fund and
Asian Growth Fund declare and pay dividends annually.
* All capital gains distributions, if any, are paid on an annual basis.

Income dividends are derived from investment income, including dividends,
interest, realized short-term capital gains, and certain foreign currency gains
received by a Fund. Capital gains distributions are derived from each Fund's
realized long-term capital gains. The per share dividends and distributions on
Adviser Class shares will be less than the per share dividends and distributions
of the Select Class as a result of the distribution fees and service fees
applicable to The Adviser Class.

Money Market Fund shares begin to accrue dividends the day after they are
purchased; a redemption will include dividends declared through the redemption
date.

Aetna Mutual Funds Prospectus 41

<PAGE>

will be reinvested in additional Adviser Class shares of that Fund and will be
credited to your account at the next determined net asset value per share. Both
income dividends and capital gains distributions are paid by a Fund on a
per-share basis. As a result, at the time of such payment, the net asset value
per share of a Fund (except the Money Market Fund) will be reduced by the
amount of such payment.

If you wish to change the manner in which you receive income dividends and
capital gains distributions, your notification of such change must be received
by the transfer agent at least ten days before the next scheduled distribution.

Net Asset Value

[Pricing
your Fund]

The net asset value per share ("NAV") of each Fund is determined as of 4:15
p.m. Eastern time on each day that the NYSE is open for trading. Except for the
Money Market Fund, the NAV is computed by dividing the total value of a Fund's
securities, plus any cash or other assets (including dividends accrued but not
collected) less all liabilities (including accrued expenses), by the number of
shares outstanding. Portfolio securities are valued primarily on the basis of
market quotations. All other assets, including restricted securities and other
securities for which market quotations are not readily available, are valued at
their fair value in such manner as may be determined, from time to time, in
good faith by, or under the authority of, the Directors.

The Money Market Fund's portfolio securities are valued by the amortized cost
method of valuation. The Money Market Fund's use of amortized cost is part of
its effort to maintain a constant net asset value of $1.00 per share.

Taxes

[Form 1099-DIV
will be mailed
to you in January]

Introduction The tax information described below is only a summary of federal
income tax consequences and is based on tax laws and regulations in effect as
of the date of this Prospectus. Please refer to the SAI for a more detailed
discussion of federal income tax considerations. In addition to federal taxes,
you may be subject to state and local taxes and you should discuss your
individual tax situation with your tax advisor.

Aetna Mutual Funds Prospectus 42

<PAGE>

Dividends" which are exempt from state and local taxes; (2) "Qualifying
Dividends" which for corporate shareholders would qualify for the 70%
dividends-received deduction; or (3) "Exempt Interest Dividends" which are
excluded from regular federal tax and possibly from state and local tax.
Dividends paid by the Government Fund may be U.S. Government Interest
Dividends. Substantially all dividends paid by the Growth and Income Fund, and,
to a lesser degree, the Aetna Fund, the Growth Fund and the Small Company
Growth Fund will be Qualifying Dividends. Currently, only the Tax-Free Fund
pays Exempt Interest Dividends, which would be included in determining the
taxability of social security benefits and a portion of which may be a
"tax-preference item" for purposes of the alternative minimum tax.

Investment income from foreign securities may be subject to foreign taxes
withheld at the source. It is impossible to determine the effective rate of
foreign tax in advance since the amount of a Fund's assets to be invested in
various countries is not known. The International Growth and Asian Growth Funds
may elect to "pass through" foreign taxes paid in order to permit shareholders
to claim a credit or deduction, if more than 50% of the value of such Fund's
assets at the close of a taxable year consist of stock or securities of foreign
corporations.

A Fund's distributions are taxable in the year they are received, whether you
take them in cash or reinvest them in additional shares. However, distributions
declared in December and paid in January are taxable as if paid on December 31.
Each Fund will send a statement to shareholders by January 31 indicating the
tax status of distributions made during the previous year, and any foreign
taxes "passed-through" to shareholders.

Buying a Dividend If you buy shares of a Fund (other than the Money Market
Fund) just before the ex-dividend date, you will be taxed on the entire amount
of the dividend received.

Share Redemptions Any gain or loss realized when you redeem (sell) or exchange
shares of a Fund will be treated as a taxable long-term or short-term capital
gain or loss. Please see the SAI for information regarding any limitation on
deductibility of such losses.

Tax Withholding When you fill out your Application, you will be asked to
certify that your Social Security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding by the Internal Revenue
Service ("IRS"). If you are subject to backup withholding, the IRS can require
a Fund to withhold 31% of your taxable dividends, capital gains distributions
and redemptions.

Aetna Mutual Funds Prospectus 43

<PAGE>

General Information

Articles of Incorporation The Company was incorporated under the laws of
Maryland on June 17, 1991. The Articles of Incorporation (Articles) provide for
the issuance of multiple series of shares each representing a portfolio of
investments with different investment objectives, policies and restrictions.
The Company currently offers 13 series or Funds. Ten of the Funds are described
in this Prospectus.

Share Classes Each Fund offers shares of common stock currently classified into
two classes, Select Class shares and Adviser Class shares. Each class of shares
has the same rights, privileges and preferences, except with respect to: (a)
the effect of the respective sales charge, if any, for each class; (b) the
distributions and/or service fees borne by each class; (c) the expenses
allocable exclusively to each class; (d) voting rights on matters exclusively
affecting a single class and (e) the exchange privilege of each class. The
Board of Directors does not anticipate that there will be any conflicts among
the interests of the holders of the different classes of shares of the Fund.
The Directors continue to consider whether any such conflicts exist and, if so,
take appropriate action.

The Company has obtained a ruling from the IRS with respect to the ten Funds
described in this Prospectus to the effect that differing distributions among
the classes of its shares will not result in the Fund's dividends or other
distributions being regarded as "preferential dividends" under the Code. The
Company is currently seeking a similar ruling for its three newest Funds. For
additional information, see the SAI.

Capital Stock The Articles currently authorize the issuance of 4.8 billion
shares of capital stock of the Company. All shares are nonassessable,
transferable and redeemable. There are no preemptive rights.

As of December 31, 1994, the following shares were owned by
Aetna companies:

ALIAC
-------------------
Adviser Select
--------- ---------
Money Market Fund 112,766
Government Fund 2,775,194
Bond Fund 2,685,214 264,524
Tax Free Fund 2,175,175 125,485
The Aetna Fund 2,473,594 306,564
Growth and Income Fund 469,715 67,107
Growth Fund 2,232,315
Small Company Growth Fund 2,472,661

Aetna Mutual Funds Prospectus 44

<PAGE>

ALIAC
----------------------
Adviser Select
----------- ----------
International Growth Fund 478,766 180,693
Asian Growth Fund 1,013,800
Aetna Ascent 20,000
Aetna Crossroads 20,000
Aetna Legacy 20,000
ALIC
----------------------
Adviser Select
----------- ----------
Money Market Fund 25,942,654 2,248,769
Asian Growth Fund 2,043,588
The Aetna Casualty and
Surety Company
----------------------
Adviser Select
----------- ----------
International Growth Fund 1,962,943 498,517

All shares were acquired for investment and can be disposed of only by
redemption. ALIAC and its affiliates may make additional investments into the
Funds.

Shareholder Meetings The Company is not required and does not intend to hold
annual shareholder meetings. The Articles provide for meetings of shareholders
to elect Directors at such times as may be determined by the Directors or as
required by the Investment Company Act of 1940. If requested by the holders of
at least 10% of a Fund's outstanding shares, the Company will hold a
shareholder meeting for the purpose of voting on the removal of one or more
Directors and will assist with communication concerning that shareholder
meeting.

Voting Rights Shareholders of each class are entitled to one vote for each full
share held and fractional votes for fractional shares of each class held on
matters submitted to the shareholders of the Company. Voting rights are not
cumulative. Generally, shares of the Company will be voted on a Company-wide
basis on all matters except matters affecting only the interest of one Fund or
one class of shares.

Payments to Dealers For sales of Funds' shares (other than Money Market Fund),
ALIAC may pay registered representatives a sales commission of up to 4% of the
amount invested for initial and subsequent sales. Registered representatives
receive payments of up to 0.50% for distribution-related services and for
services to shareholders (see "Fees and Charges"). From time to time, ALIAC may
also award merchandise or trips with an estimated value up to $1,000 to
registered

Aetna Mutual Funds Prospectus 45

<PAGE>

representatives that sell a certain amount of fund shares or establish a
certain number of new accounts. Incentive commissions and prizes are paid by
ALIAC so the price you pay for Adviser Class shares and the value of your
investment will be unaffected.

Performance Data

The Funds may compare their performance to other mutual funds with similar
investment objectives and to the industry as a whole, as quoted by ranking
services and publications of general interest. These may include the Standard &
Poor's 500 Stock Index ("S&P 500"), Shearson Lehman Aggregate Bond Index, Dow
Jones Industrial Average ("DJIA"), Lipper Analytical Services, Inc.,
IBC/Donoghue's Taxable MFA, the Morgan Stanley Capital International Europe,
Australia, Far East ("EAFE") Index and the Morgan Stanley Capital
International Far East Free ("FEF ex. Japan") Index.

Glossary of Investment Terms

This glossary describes some of the securities used by the Funds. Further
information is available in the SAI:

Banker's Acceptance A banker's acceptance is a time draft drawn on a bank and
is customarily used by corporations as a means of financing payment for traded
goods. When a draft is accepted by a bank, the bank guarantees to pay the face
value of the debt at maturity.

Certificates of Deposit For large deposits not withdrawable on demand, banks
issue certificates of deposit ("CDs") as evidence of ownership. CDs are usually
negotiable and traded among investors such as mutual funds and banks.

Commercial Paper Commercial paper is short-term debt instruments issued by
companies or banks with a maturity ranging from five to 270 days.

Eurodollars Eurodollars are U.S. dollars held in banks outside the United
States, mainly in Europe but also in other countries, and are commonly used for
the settlement of international transactions. There are many types of
Eurodollar securities including Eurodollar CDs and bonds; these securities are
not registered with the Commission. Certain Eurodollar deposits are not FDIC
insured and may be subject to future political and economic developments and
governmental restrictions.

High Risk High-Yield Securities Bonds of low quality security backing rated BB
or below by Standard & Poor's Corp. or Ba or below by

Aetna Mutual Funds Prospectus 46

<PAGE>

Moody's Investors Service, Inc., or other agencies or, if unrated, considered by
the Investment Adviser to be of comparable quality. These bonds are often
called "junk bonds" because of the greater possibility of default.

Municipal Securities Debt obligations issued by states, territories and
possessions of the United States, the District of Columbia and their political
subdivisions, agencies and instrumentalities, or multi-state agencies or
authorities. Such securities provide interest income that is exempt from
federal income taxes, and in some instances, state and local income taxes.

Pay-in-Kind Bonds Pay-in-kind bonds are securities that pay interest through
the issuance of additional bonds.

Repurchase Agreements A repurchase agreement or "repo" is an agreement between
a seller and buyer, usually of U.S. Government securities, to sell and
subsequently repurchase securities at a fixed price on a future date. The
primary attraction of repurchase agreements is the flexibility of maturities.

U.S. Government Derivatives A Fund may purchase separately traded principal and
interest components of certain U.S. Government securities ("STRIPS"). In
addition, a Fund may acquire custodial receipts that represent ownership in a
U.S. Government security's future interest or principal payments. These
securities are known by such exotic names as TIGRS and CATS and may be issued
at a discount to face value. They are generally more volatile than normal fixed
income securities because interest payments are accrued rather than paid out in
regular installments.

U.S. Government Securities Securities issued by the U.S. Government and its
agencies.

Direct Obligations of the U.S. Government are:

Treasury Bills - issued with short maturities (one year or less) and priced at
a discount to face value. The income for investors is the difference between
the purchase price and the face value.

Treasury Notes - intermediate-term securities with maturities of between one to
ten years. Income to investors is paid in semiannual interest payments.

Treasury Bonds - long-term securities with maturities from ten years to up to
thirty years. Income is paid to investors on a semiannual basis.

In addition, U.S. Government Agencies issue debt securities to finance
activities for the U.S. Government. These agencies include

Aetna Mutual Funds Prospectus 47

<PAGE>

among others the Federal Home Loan Bank, Federal National Mortgage Association
("FNMA" or "Fannie Mae"), Government National Mortgage Association ("GNMA" or
"Ginnie Mae"), Export-Import Bank and the Tennessee Valley Authority.

Not all agencies are backed by the full faith and credit of the United States;
for example the FNMA may borrow money from the U.S. Treasury only under certain
circumstances. There is no guarantee that the government will support these
types of securities and they therefore involve more risk than direct government
obligations.

Variable Rate Instruments A variable or floating rate instrument is one whose
terms provide for the adjustment of its interest rate on set dates and which
can reasonably be expected to have a market value close to par value.

Yankee Bonds A bond issued in the United States by foreign countries,
corporations and banks. Similarly, Yankee CDs are issued in the U.S. by
branches of foreign banks.

Zero Coupon Bonds Bonds issued at a deep discount to face value. These bonds
pay no interest but are redeemed at full face value. The price of zero coupon
bonds are more volatile than bonds which pay interest but are rated on the same
principles as all fixed-income investments.

The Funds also use some of the following securities to manage risk and
volatility:

Call Option The right to buy a security, currency or stock index at a stated
price, or strike price, within a fixed period. A call option will be exercised
if the spot price rises above the strike price; if not, the option expires
worthless.

Put Option The right to sell a security, currency or stock index at a stated
price, or strike price, within a fixed period. A put option will be exercised
if the spot price falls below the strike price; if not, the option expires
worthless.

Covered Call Options A call option backed by the securities underlying the
option. The owner of a security will normally sell covered call options to
collect premium income or to reduce price fluctuations of the security. A
covered call option limits the capital appreciation of the underlying security.

Aetna Mutual Funds Prospectus 48

<PAGE>

Convertible Stock Corporate securities, which may be either bonds or preferred
shares, that can be exchanged for shares at a fixed price.

Futures Contracts to buy securities, currencies or stock indexes in the future
at a price agreed in advance. A futures contract obliges the buyer to purchase
the security and the seller to sell it, unlike an option where the buyer can
choose whether or not to exercise the option.

Preferred Stock Shares which pay a fixed dividend, in contrast to common stock
whose dividends depend on the profits of the company.

Warrants A security, normally offered with bonds or preferred stock, that
entitles investors to buy shares at a prescribed price within a named period.
The time period is usually longer than that of a call option.

Description of Corporate Bond Ratings

Moody's Investors Service, Inc.

"Aaa" Rating Bonds rated Aaa are judged to be of the best quality and carry the
smallest degree of investment risk. Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.

"Aa" Rating Bonds rated Aa are judged to be of high-quality by all standards.
Together with the Aaa group, they are generally known as high-grade bonds. They
are rated lower than the best bonds because margins of protection may not be as
large as in Aaa securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make the
long-term risks appear somewhat greater than in Aaa securities.

"A" Rating Bonds rated A possess many favorable investment attributes and are
considered upper-medium-grade obligations. Factors relating to security of
principal and interest are considered adequate but elements may be present
which suggest possible impairment sometime in the future.

"Baa" Rating Bonds rated Baa are considered medium-grade obligations (i.e.,
they are neither highly protected nor poorly secured). Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and have
speculative characteristics.

Aetna Mutual Funds Prospectus 49

<PAGE>

not well safeguarded during other good and bad times over the future.
Uncertainty of position characterizes this class of bond.

"B" Rating Bonds rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

The modifier 1 indicates that the bond ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its rating category.

Standard & Poor's Corporation

"AAA" Rating Bonds rated AAA have the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely strong.

"AA" Rating Bonds rated AA have a very strong capacity to pay interest and
repay principal and differ from the highest rated issues only in small degree.

"A" Rating Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than debt in higher rated
categories.

"BBB" Rating Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate
protection, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher-rated categories.

"BB" Rating Bonds rated BB have less near-term vulnerability to default than
other speculative issues. However, the bonds face major uncertainties or
exposure to adverse business, financial, or economic conditions which could
lead to inadequate capacity to meet timely interest and principal payments.

"B" Rating Bonds rated B have a greater vulnerability to default but currently
have the capacity to meet interest payments and principal repayments. Adverse
business, financial, or economic conditions will
likely impair capacity or willingness to pay interest and repay
principal.
The ratings from "AA" to "B" may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within the major rating categories.

Aetna Mutual Funds Prospectus 50

<PAGE>

Aetna Series Fund, Inc.
151 Farmington Avenue
Hartford, CT 06156-8962
1-800-367-7732

Investment Adviser
Aetna Life Insurance and Annuity Company
151 Farmington Avenue
Hartford, CT 06156

Custodians
Mellon Bank N.A.
One Mellon Bank Center
Pittsburgh, PA 15258

Brown Brothers Harriman & Company
40 Water Street
Boston, MA 02109

Transfer Agent
Firstar Trust Company
P.O. Box 701
Milwaukee, WI 53201-0701

Independent Auditors
KPMG Peat Marwick LLP
CityPlace II
Hartford, CT 06103-4103

This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, the securities of a Fund in any jurisdiction in which such sale,
offer to sell, or solicitation may not be lawfully made.

Aetna Mutual Funds Prospectus 51

<PAGE>

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<PAGE>

Select Class

March 31, 1995
Aetna
Mutual Funds
Prospectus
-------------------------------------------------------------------------------

This Prospectus is for investors eligible to purchase Select Class shares of
each Fund. A separate Prospectus is available for all other investors. Sales
charges, expenses and performance will vary with respect to each class.

Investment Objectives
-------------------------------------------------------------------------------

Aetna Money Market Fund seeks to provide high current return, consistent with
preservation of capital and liquidity, through investment in high-quality money
market instruments.

<PAGE>

Aetna Growth Fund seeks growth of capital through investment in a diversified
portfolio primarily of common stocks and securities convertible into common
stocks believed to offer growth potential.

Aetna International Growth Fund seeks long-term capital growth primarily
through investment in a diversified portfolio of common stocks principally
traded in countries outside of North America.

Aetna Asian Growth Fund seeks long-term growth of capital primarily through
investment in a diversified portfolio of common stocks principally traded in
countries in Asia excluding Japan.

2 Aetna Mutual Funds Prospectus

<PAGE>

Table of Contents

Highlights............................. 4
Fee Tables............................. 7
Financial Highlights................... 12
Description of the Funds............... 16
Risk Factors and Other Considerations.. 23
Investment Restrictions................ 28
Shareholder Services................... 29
Other Features......................... 35
Cross-Fund Investing................... 36
Management of the Funds................ 36
Portfolio Management................... 39
Fund Distributions..................... 40
Net Asset Value........................ 41
Taxes.................................. 42
General Information.................... 43
Performance Data....................... 45
Glossary of Investment Terms........... 45
Description of Corporate Bond Ratings.. 48