[Image] Scudder Micro Cap Fund Profile [Image]
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The fund profile, a supplement to the full prospectus, is designed as
an easy-to-read summary of fund risks, fees, and objectives. You can
click on any question to link to the Fund's prospectus and get more
information on that topic. Or, if you wish, you can proceed directly
to the Fund's prospectus. Once you have read the prospectus and
considered your investment goals, you can proceed to a Scudder Funds
application.
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Fund Profile
November 1, 1997
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1. What Is The Fund's Objective?
Scudder Micro Cap Fund seeks long-term growth of capital by investing
primarily in a diversified portfolio of U.S. micro-capitalization
common stocks.
2. What Does The Fund Invest In?
The Fund will normally invest at least 80% of its assets in common
stocks issued by U.S. micro-cap companies. The Fund will typically
invest in companies that, at the time of purchase, are smaller than
the smallest stocks in the Russell 2000 Index at its annual
reconstitution. The median market capitalization (i.e., current stock
price times shares outstanding) of the portfolio is not expected to
exceed $125 million. The Fund's investment adviser, Scudder, Stevens &
Clark, Inc. believes these domestic emerging growth companies offer
the potential for substantial long-term appreciation.
The adviser selects investments from among more than 4,000 publicly
traded U.S. micro-cap stocks based on a proprietary, quantitative
investment strategy. The adviser looks for companies selling at a
discount to estimated fair value. The adviser expects to invest in
hundreds of such companies, representing a broad cross-section of U.S.
industries.
The Fund may purchase other types of exchange listed or
over-the-counter securities, including preferred stocks, convertible
or non-convertible securities, rights and warrants.
Due to investment considerations, it is presently intended that the
Fund will close to new individual investors when it reaches $100
million in total assets. If the Fund does so close, the Trustees may
determine to reopen it at some future point.
3. What Are The Risks Of Investing In The Fund?
Due to the inherent business characteristics and risks of small
companies, along with the relative limited trading market for
micro-cap stocks, the Fund's share price can experience periods of
significant volatility. Also, because micro-cap companies normally
have fewer shares outstanding and these shares trade less frequently
than those of large companies, it may be more difficult for the Fund
to buy and sell significant amounts of such shares without an
unfavorable impact on prevailing prices. Micro-cap companies entail
higher risk due to their smaller size; relative age; limited product
lines; distribution channels; financial resources; possible lack of
managerial depth and experience; and dependence on key personnel.
Further, there is typically less publicly available information for
smaller companies, their securities are often traded over-the-counter
and thus the prices of these securities are often more volatile than
those of larger companies. Microcap companies are also more vulnerable
to adverse market or economic conditions than larger companies.
Movements of the stock market will affect the Fund's share price,
which is likely to vary from day-to-day. The value of your investment
may decline as a result of declines in the overall stock market or in
the types of securities held in the Fund's portfolio. You incur
principal risk because your shares, when sold, may be worth more or
less than what you paid for them.
4. For Whom Is This Fund Appropriate?
You may wish to consider this Fund if you are seeking long-term growth
of capital and:
o plan to hold your investment for the longer term (at least 5
years or more),
o can tolerate share price volatility with little or no current
income,
o have or plan to have other investments for the benefit of
diversification, and
o understand the risks of investing in micro-cap companies.
5. What Are The Fund's Expenses And Fees?
There are two kinds of expenses that a shareholder may incur, directly
or indirectly, by investing in a mutual fund. These types of expenses,
as they relate to Scudder Micro Cap Fund are:
Shareholder transaction expenses --
Expenses charged directly to your account for various transactions.
Please note that there is a $5 service fee if you request redemption
proceeds via wire.
Sales Commission None
Commissions to Reinvest Dividends None
Redemption Fee Payable to the Fund 1.00%*
Exchange Fee Payable to the Fund 1.00%*
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*Imposed on redemptions or exchanges of shares held less than one
year.
Annual Fund operating expenses (after expense maintenance) --
Estimated expenses paid by the Fund before it distributes its net
investment income, expressed as a percentage of the Fund's average
daily net assets. Figures below have been estimated for the initial
fiscal year during which Scudder has agreed to maintain the total
annualized expenses of the Fund at not more than 1.75% of average
daily net assets. Had Scudder not done so, it is estimated that
total operating expenses would have amounted to 1.86%, including
0.75% for management fees. Scudder will continue this expense
maintenance until December 31, 1997.
Investment management fee (after waiver) 0.64%
12b-1 fees None
Other expenses 1.11%
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Total Fund operating expenses (after waiver) 1.75%
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Example:
Assuming a 5% annual return and redemption at the end of each
period, the total expenses relating to a $1,000 investment would be:
1 Year 3 Years
$18 $55
This example assumes reinvestment of all dividends and distributions
and that the total Fund operating expenses listed above remain the
same each year. This example should not be considered a representation
of past or future expenses or return. Actual Fund expenses and return
vary from year to year and may be higher or lower than those shown.
6. How Has The Fund Performed Historically?
The Fund commenced operations on August 12, 1996. Performance is
historical and is no guarantee of future results. Total return and
principal value will fluctuate.
One Year Life of Fund
The Fund's Total Return for the 46.86% 44.45%
period ended September 30, 1997
If the adviser had not maintained the Fund's expenses, total return
would have been lower.
7. Who Manages The Fund?
The Fund's investment adviser is Scudder, Stevens & Clark, Inc., a
leading provider of U.S. and international investment management for
clients throughout the world. The Fund is managed by a team of Scudder
investment professionals, who each play an important role in the
Fund's management process.
James M. Eysenbach, Lead Portfolio Manager, joined Scudder in 1991 as
a senior quantitative analyst and is currently director of
quantitative research for Scudder. Mr. Eysenbach has more than nine
years investment research and management experience. Philip S.
Fortuna, Portfolio Manager, joined Scudder in 1986 as manager of
institutional equity accounts. He became director of quantitative
research in 1987 and served as director of investment operations from
1993 to 1994.
8. How Can I Invest?
To make it easy for you to open an account, you may invest by mail,
phone, fax, or in person. The minimum initial investment is $2,500,
except that shareholders may open an account with at least $1,000 if
an automatic investment plan of $100/month is established. Scudder
retirement plans and certain other accounts have similar or lower
minimum share balance requirements. A shareholder who maintains a
nonfiduciary account balance of less than $2,500 without establishing
an automatic investment plan, will be assessed an annual fee of
$10.00, payable to the Fund. Retirement accounts and certain other
accounts will not be assessed the $10.00 charge. You may also exchange
Fund shares within the Scudder Family of Funds.
9. How Can I Redeem Shares?
You may redeem shares at the current share price on any business day
by telephone, fax, or mail. There may be a 1% fee retained by the Fund
which is imposed only on redemptions or exchanges of shares held less
than one year.
10. When Are Distributions Made?
The Fund typically makes distributions in November or December. You
may elect to receive distributions in cash or have them reinvested in
additional shares of the Fund.
Generally, dividends from net investment income are taxable to
shareholders as ordinary income. Long-term capital gains
distributions, if any, are taxable as long-term capital gains
regardless of the length of time shareholders have owned their shares.
Short-term capital gains and any other taxable income distributions
are taxable as ordinary income. A portion of such dividends from net
investment income may qualify for the dividends-received deduction for
corporations.
11. What Services Does Scudder Provide?
As a shareholder, you'll enjoy:
o professional service from representatives who can answer your
questions and execute your transactions
o automated toll-free touchtone access to account information,
share prices and yields, and to perform transactions
o Scudder's quarterly shareholder newsletter, Scudder Perspectives
o regular, informative reports about the performance of your Fund
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[Image]Scudder wants you to make informed investment decisions. This
Fund Profile contains key information about the Fund. If you would
like more information before you invest, please consult the Fund's
accompanying prospectus. For details about the Fund's holdings or
recent investment strategies, please review the Fund's most recent
annual or semiannual report. The reports are free and may be ordered
by calling 1-800-225-2470.
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