PROSPECTUS
January 31, 1995 As Revised September 30, 1995
CALVERT WORLD VALUES FUND, INC.
GLOBAL EQUITY FUND
4550 Montgomery Avenue, Bethesda, Maryland 20814
INVESTMENT OBJECTIVE
The investment objective of Calvert World Values Fund, Inc., Global Equity Fund
(the "Fund") is to achieve a high total return consistent with reasonable risk,
by investing primarily in a globally diversified portfolio of equity securities.
To the extent possible, investments are made in enterprises that make a
significant contribution to our global society through their products and
services and through the way they do business. In particular, the Fund intends
to invest a part of its assets in companies with strong interest in the
environment, human rights and health care. Investments must satisfy both the
financial and social criteria of the Fund.
PURCHASE INFORMATION
The Fund offers two classes of shares, each with different expense levels and
sales charges. You may choose to purchase (i) Class A shares, with a sales
charge imposed at the time you purchase the shares ("front-end sales charge");
or (ii) Class C shares which impose neither a front-end sales charge nor a
contingent deferred sales charge. Class C shares are not available through all
dealers. Class C shares have a higher level of expenses than Class A shares,
including higher Rule 12b-1 fees. These alternatives permit you to choose the
method of purchasing shares that is most beneficial to you, depending on the
amount of the purchase, the length of time you expect to hold the shares, and
other circumstances. See "Alternative Sales Options" for further details.
ADVISORS
Calvert Asset Management Company, Inc. is the Fund's Advisor, responsible for
overall management and supervision of the Fund's investment and day-to-day
management. Murray Johnstone International, Ltd. is the Fund's Sub-Advisor,
responsible for asset allocation and selection of the specific investments for
the Fund. See "Management of the Fund."
TO OPEN AN ACCOUNT
Call your broker, or complete and return the enclosed Account Application.
Minimum initial investment is $2,000 (may be lower for certain retirement
plans).
ABOUT THIS PROSPECTUS
Please read this Prospectus before investing. It is designed to provide you with
information you ought to know before investing and to help you decide if the
Fund's goals match your own. Keep this document for future reference.
A Statement of Additional Information (dated January 31, 1995) for the Fund has
been filed with the Securities and Exchange Commission and is incorporated by
reference. This free Statement is available upon request from the Fund:
800-368-2748.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FDIC, THE FEDERAL RESERVE
BOARD, OR ANY OTHER AGENCY. WHEN INVESTORS SELL SHARES OF THE FUND, THE VALUE
MAY BE HIGHER OR LOWER THAN THE AMOUNT ORIGINALLY PAID.
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<TABLE>
<CAPTION>
FUND EXPENSES
Class A Class C
<S> <C> <C>
A. Shareholder Transaction Costs
Maximum Front-End Sales Charge on 4.75% None
Purchases (as a percentage of offering
price)
Contingent Deferred Sales Charge None None
B. Annual Fund Operating Expenses<F1>
Fiscal Year 1994
(as a percentage of net assets, net of
any applicable expense
reimbursement/fee waiver)
Management Fees 1.10% 1.10%
Rule 12b-1 Service and Distribution Fees
0.25% 1.00%
Other Expenses 0.64% 1.72%
Total Fund Operating Expenses 1.99% 3.82%
<FN>
<F1>Expense ratios for Class A shares have been restated to reflect expenses
anticipated for the current fiscal year.
</FN>
</TABLE>
C. Example: You would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the
end of each time period:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
Class A (Assumes payment
of maximum initial sales $67 $107 $150 $268
charge at time of purchase.)
Class C $38 $117 $197 $405
Explanation of Table: The purpose of the table is to assist you in
understanding the various costs and expenses that an investor in the
Fund would bear directly (shareholder transaction costs) or indirectly
(annual fund operating expenses).
</TABLE>
A. Shareholder Transaction Costs are charges you pay when you buy or sell shares
of the Fund. See "Reduced Sales Charges" at Exhibit A to see if you qualify for
possible reductions in the sales charge. If you request a wire redemption of
less than $1,000, you will be charged a $5 wire fee.
B. Annual Fund Operating Expenses. Management Fees are paid by the Fund to
Calvert Asset Management Company, Inc. ("Investment Advisor") for managing the
Fund's investments and business affairs. Management fees include the
Sub-Advisory fee paid by the Investment Advisor to Murray Johnstone
International, Ltd., ("Sub-Advisor"), and the Administrative Service fee paid to
Calvert Administrative Services Company. The Fund incurs Other Expenses for
maintaining shareholder records, furnishing shareholder statements and reports,
and other services. Management Fees and Other Expenses have already been
reflected in the Fund's daily share price and are not charged directly to
individual shareholder accounts. Please refer to "Management of the Fund" for
further information. The Advisor may voluntarily defer fees or assume expenses
of the Fund. For the year ended September 30, 1994, no fees were waived and
$4,980 of expenses were reimbursed for Class C Shares. The Investment Advisory
Agreement provides that the Advisor may later, to the extent permitted by law,
recapture any fees it deferred or expenses it assumed during the two prior
years; provided, however, that total Annual Fund Operating Expenses for Class A
shall not exceed 2.00% of average net assets during any year in which the
Advisor elects to exercise the recapture provision. During the 1994 fiscal year,
the Advisor recaptured $45,532 of fees it had deferred in 1992 from Class A
Shares. The above table reflects these agreements.
The Fund's Rule 12b-1 fees include an asset-based sales charge. Thus, it is
possible that long-term shareholders in the Fund may pay more in total sales
charges than the economic equivalent of the maximum front-end sales charge
permitted by rules of the National Association of Securities Dealers, Inc.
C. Example of Expenses. The example, which is hypothetical, should not be
considered a representation of past or future expenses. Actual expenses and
return may be higher or lower than those shown.
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FINANCIAL HIGHLIGHTS
The following table provides information about the financial history of the
Fund's Class A and C shares. It expresses the information in terms of a single
share outstanding for the Fund throughout each period. The table has been
audited by Coopers & Lybrand, independent accountants, whose report on the
period from July 2, 1992 (commencement of operations) through September 30, 1994
is included in the Annual Report to Shareholders of the Fund. The table should
be read in conjunction with the financial statements and their related notes.
The Annual Report to Shareholders is incorporated by reference into the
Statement of Additional Information.
<TABLE>
<CAPTION>
Class C Shares
From Inception (March 1,
1994) To Sept. 30, 1994
<S> <C>
Net Asset Value, Beginning of Period $18.24
Income from investment operations
Net investment income (.06)
Net realized and unrealized gain (loss) on investments
(.32)
Total from investment operations (.38)
Distributions to shareholders
Distributions from net investment income --
Distributions in excess of net investment income --
Distribution from capital gains --
Total Distributions --
Total increase (decrease) in net asset value (.38)
Net asset value, end of period $17.86
Total return<F2> (1.27)%
Ratio of expenses to average net assets 3.32%(a)
Ratio of net income to average net assets (1.16)%(a)
Increase reflected in above net investment income ratios due
to expense reimbursement .50%(a)
Portfolio Turnover 78%
Net assets, end of period $3,620,045
Number of shares outstanding at end of period (in thousands)
203
<FN>
<F2>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
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<TABLE>
<CAPTION>
Class A Shares
Year Ended Sept. 30,
1994
<S> <C>
Net Asset Value, Beginning of Period $16.35
Income from investment operations
Net investment income --
Net realized and unrealized gain (loss) on investments
2.14
Total from investment operations 2.14
Distributions to shareholders
Distributions from net investment income (.03)
Distributions in excess of net investment income
(.04)
Distribution from capital gains (.43)
Total Distributions (.50)
Total increase (decrease) in net asset value 1.64
Net asset value, end of period $17.99
Total return<F2> 13.44%
Ratio of expenses to average net assets 1.96%
Ratio of net income to average net assets (.04)%
Increase reflected in above net investment income ratio due
to expense reimbursement (.04)%
Portfolio Turnover 78%
Net assets, end of period $175,543,369
Number of shares outstanding at end of period (in thousands)
9,755
<FN>
<F2>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
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<TABLE>
<CAPTION>
Class A Shares
Year Ended Sept. 30,
1993
====================
<S> <C>
Net Asset Value, Beginning of Period $14.31
Income from investment operations
Net investment income .08
Net realized and unrealized gain (loss) on investments
2.04
Total from investment operations 2.12
Distributions to shareholders
Distributions from net investment income (.05)
Distribution from capital gains (.03)
Total Distributions (.08)
Total increase (decrease) in net asset value 2.04
Net asset value, end of period $16.35
Total return<F3> 14.95%
Ratio of expenses to average net assets 1.50%
Ratio of net income to average net assets .80%
Increase reflected in above net investment income ratio due
to expense reimbursement .20%
Portfolio turnover 35%
Net assets, end of period $54,280,381
Number of shares outstanding at end of period (in thousands)
3,319
<FN>
<F3>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
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<TABLE>
<CAPTION>
From Commencement of
Operations (July 2, 1992)
through Sept. 30, 1992
==========================
<S> <C>
Net Asset Value, Beginning of Period $15.00
Income from investment operations
Net investment income .02
Net realized and unrealized gain (loss) on investments
(.71)
Total from investment operations (.69)
Distributions to shareholders
Distributions from net investment income --
Distribution from capital gains --
Total Distributions --
Total increase (decrease) in net asset value (.69)
Net asset value, end of period $14.31
Total return<F3> (4.60)%
Ratio of expenses to average net assets 1.01%(a)
Ratio of net income to average net assets 1.23%(a)
Increase reflected in above net investment income ratio
to expense reimbursement .60%(a)
Portfolio turnover --
Net assets, end of period $8,439,650
Number of shares outstanding at end of period
(in thousand) 590
<FN>
<F3>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
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INVESTMENT OBJECTIVE AND POLICIES
Investment Objective
The Fund seeks to provide a high total return consistent with reasonable risk by
investing primarily in a globally diversified portfolio of equity securities.
All investments are screened for financial and social criteria. There is, of
course, no assurance that the Fund will be successful in meeting its objective.
Under normal circumstances, the Fund will invest at least 65% of its assets in
equity securities.
The Fund will invest primarily in common stocks of established foreign and U.S.
companies believed by the Sub-Advisor to have potential for capital growth,
income or both. Companies are considered established if their securities are
traded on a recognized stock exchange. However, the Fund may invest in any other
type of security including, but not limited to, convertible securities,
preferred stocks, bonds, notes and other debt securities of companies,
(including Euro-currency instruments and securities) or of any international
agency (such as the Asian Development Bank or Inter-American Development Bank)
or obligations of domestic or foreign governments and their political
subdivisions, and in foreign currency transactions. See "Debt Obligations." The
Fund may establish and maintain reserves for temporary defensive purposes or to
enable it to take advantage of buying opportunities. The Fund's reserves may be
invested in domestic as well as foreign short-term money market instruments
including, but not limited to, U.S. and foreign government and agency
obligations, and obligations of supranational entities, certificates of deposit,
bankers' acceptances, time deposits, commercial paper, short-term corporate debt
securities and repurchase agreements. Any money market instruments will be rated
at least A-2/P-2 or better by a nationally recognized statistical rating
organization such as Standard and Poor's or Moody's, or, if unrated, determined
by the Advisor or Sub-Advisor to be of equivalent credit quality. The Fund may
also engage in certain options transactions, and enter into futures contracts
and related options for hedging purposes. (See "Investment Techniques and
Risks.")
Under normal circumstances, the Fund will invest at least 65% of its assets in
the securities of issuers in no less than three countries, one of which may be
the USA.
The Fund makes investments in various countries. Under normal circumstances,
business activities in a number of different foreign countries will be
represented in the Fund's investments. The Fund may, from time to time, have
more than 25% of its assets invested in any major industrial or developed
country which in the view of the Sub-Advisor poses no unique investment risk.
The Sub-Advisor considers an investment in a given foreign country to have "no
unique investment risk" if the Fund's investment in that country is not
disproportionate to the relative size of the country's market versus the Morgan
Stanley Capital International Europe-Far East-Asia (EFEA) or World Index or
other comparable index, and if the capital markets in that country are mature,
and of sufficient liquidity and depth. Under exceptional economic or market
conditions, the Fund may invest substantially all of its assets in only one or
two countries, or in U.S. government obligations or securities of companies
incorporated in and having their principal activities in the U.S.
The Sub-Advisor considers several factors in determining the various countries
in which to invest.
In determining the appropriate distribution of investments among various
countries and geographic regions, the Sub-Advisor ordinarily will consider the
following factors: prospects for relative economic growth among foreign
countries; expected levels of inflation; relative price levels of the various
capital markets; government policies influencing business conditions; the
outlook for currency relationships and the range of individual investment
opportunities available to the global investor. The Fund may make investments in
developing countries, which involve exposure to economic structures that are
generally less diverse and mature than in the United States, and to political
systems which may be less stable. A country is considered to be a developing
country if it is not included in the Morgan Stanley Capital International World
Index. Examples of developing countries would currently include countries such
as Argentina, Brazil, Indonesia, Taiwan, Mexico, Turkey, Chile, India, and
Korea. Investing in developing countries often involves risk of high inflation,
high sensitivity to commodity prices, and government ownership of the biggest
industries in that country. Investing in developing countries also involves a
higher probability of occurrence of the risks of investing in foreign securities
in general, including but not limited to, less financial information available,
relatively illiquid markets, and the possibility of adverse government action
(see "Risk Factors" below). No more than 30% of the Fund's net assets may be
invested in the securities of issuers located in developing countries. In the
past, markets of developing countries have been more volatile than the markets
of developed countries; however, such markets often have provided higher
long-term rates of return to investors. The Sub-Advisor believes that these
characteristics may be expected to continue in the future.
Generally, the Fund will not trade in securities for short-term profits, but,
when circumstances warrant, securities may be sold without regard to the length
of time held.
Debt obligations
Although the Fund invests primarily in equity securities, it may invest up to
35% of its net assets in debt securities, excluding money market instruments. Of
this, at least 30% will be of the highest credit quality available (rated AAA or
Aaa by Standard & Poor's (S&P) or Moody's, respectively, or if not rated by S&P
or Moody's, then determined by the Sub-Advisor to be of equivalent credit
quality). All fixed income instruments are subject to interest-rate risk; that
is, when market interest rates rise, the current principal value of a bond will
decline. The remaining 5% of Fund assets that may be invested in debt securities
may be rated lower than AAA or Aaa, but in no event lower than BBB or Baa, or,
if unrated, then determined by the Sub-Advisor to be of equivalent credit
quality. The Sub-Advisor does not intend to purchase any bonds rated lower than
AAA unless the instrument provides an opportunity to invest in an attractive
company in which an equity investment is not currently available or desirable.
The Fund will not buy any bonds rated less than investment grade. If a change in
credit quality after acquisition by the Fund causes the bond to no longer be
investment grade, the Sub-Advisor, will generally dispose of the bond if
necessary to keep its holdings, if any, of such bonds to 5% or less of the
Fund's assets. See the Statement of Additional Information, "Credit Quality" and
"Appendix--Corporate Bond and Commercial Paper Ratings" for more information on
bond ratings and credit quality.
Foreign Government Securities
The Sub-Advisor may from time to time invest in the debt instruments of foreign
sovereign governments. These may include short-term treasury bills, notes and
long-term bonds, and will only be considered for investment by the Fund if they
have the full guarantee of the government in question. The Sub-Advisor will not
invest in foreign government securities with a rating by Moody's Investors
Services lower than AA2.
RISK FACTORS
An investment in the Fund is subject to various risks. The net asset value will
fluctuate in response to changes in market conditions and the value of the
Fund's portfolio investments. The Fund's use of certain investment techniques,
such as foreign currency options, involve special risks. See "Investment
Techniques and Related Risks."
There are substantial and different risks involved in investing in foreign
securities. You should consider these risks carefully. For example, there is
generally less publicly available information about foreign companies than is
available about companies in the U.S. Foreign companies are not subject to
uniform audit and financial reporting standards, practices and requirements
comparable to those in the U.S.
Foreign securities involve currency risks. The U.S. dollar value of a foreign
security tends to decrease when the value of the dollar rises against the
foreign currency in which the security is denominated and tends to increase when
the value of the dollar falls against such currency. Fluctuations in exchange
rates may also affect the earning power and asset value of the foreign entity
issuing the security. Dividend and interest payments may be returned to the
country of origin, based on the exchange rate at the time of disbursement, and
restrictions on capital flows may be imposed. Losses and other expenses may be
incurred in converting between various currencies in connections with purchases
and sales of foreign securities.
Foreign stock markets are generally not as developed or efficient as those in
the U.S. In most foreign markets volume and liquidity are less than in the U.S.
and, at times, volatility of price can be greater than that in the U.S. Fixed
commissions on foreign stock exchanges are generally higher than the negotiated
commissions on U.S. exchanges. There is generally less government supervision
and regulation of foreign stock exchanges, brokers and companies than in the
U.S.
There is also the possibility of adverse changes in investment or exchange
control regulations, expropriation or confiscatory taxation, limitations on the
removal of funds or other assets, political or social instability, or diplomatic
developments which could adversely affect investments, assets or securities
transactions of the Fund in some foreign countries. The Fund is not aware of any
investment or exchange control regulations which might substantially impair the
operations of the Fund as described, although this could change at any time.
For many foreign securities, there are U.S. dollar-denominated American
Depository Receipts ("ADRs"), which are traded in the U.S. on exchanges or over
the counter and are generally sponsored and issued by domestic banks. ADRs are
receipts typically issued by a U.S. bank or trust company which evidence
ownership of underlying securities of a foreign corporation. ADRs do not
eliminate all the risk inherent in investing in the securities of foreign
issuers. However, by investing in ADRs rather than directly in foreign issuers'
stock, the Fund can avoid currency risks and some liquidity risks during the
settlement period for either purchases or sales. The information available for
ADRs is subject to the more uniform and more exacting accounting, auditing and
financial reporting standards of the domestic market or exchange on which they
are traded. In general, there is a large, liquid market in the U.S. for many
ADRs. The Fund may also invest in European Depository Receipts ("EDRs"), which
are receipts evidencing an arrangement with a European bank similar to that for
ADRs and are designed for use in the European securities markets. EDRs are not
necessarily denominated in the currency of the underlying security.
The dividends and interest payable on certain of the Fund's foreign securities
may be subject to foreign withholding taxes, thus reducing the net amount
available for distribution to the Fund's shareholders. You should understand
that the expense ratio of the Fund can be expected to be higher than those of
investment companies investing only in domestic securities since the costs of
operations are higher.
INVESTMENT TECHNIQUES and RELATED RISKS
The Fund may write covered call options and purchase call and put options on
securities and security indices, and may write secured put options and enter
into option transactions on foreign currency. It may also engage in transactions
in financial futures contracts and related options for hedging purposes, and
invest in repurchase agreements. These investment techniques and the related
risks are summarized below and are described in more detail in the Statement of
Additional Information.
Writing (Selling) Call and Put Options
A call option on a security, security index or a foreign currency gives the
purchaser of the option, in return for the premium paid to the writer (seller),
the right to buy the underlying security, index or foreign currency at the
exercise price at any time during the option period. Upon exercise by the
purchaser, the writer of a call option on an individual security or foreign
currency has the obligation to sell the underlying security or currency at the
exercise price. A call option on a securities index is similar to a call option
on an individual security, except that the value of the option depends on the
weighted value of the group of securities comprising the index and all
settlements are to be made in cash. A call option may be terminated by the
writer (seller) by entering into a closing purchase transaction in which it
purchases an option of the same series as the option previously written.
A put option on a security, security index, or foreign currency gives the
purchaser of the option, in return for the premium paid to the writer (seller),
the right to sell the underlying security, index, or foreign currency at the
exercise price at any time during the option period.
Upon exercise by the purchaser, the writer of a put option has the obligation to
purchase the underlying security or foreign currency at the exercise price. A
put option on a securities index is similar to a put option on an individual
security, except that the value of the option depends on the weighted value of
the group of securities comprising the index and all settlements are made in
cash.
The Fund may write exchange-traded call options on its securities. Call options
may be written on portfolio securities, securities indices, or foreign
currencies. With respect to securities and foreign currencies, the Fund may
write call and put options on an exchange or over-the-counter. Call options on
portfolio securities will be covered since the Fund will own the underlying
securities. Call options on securities indices will be written only to hedge in
an economically appropriate way portfolio securities which are not otherwise
hedged with options or financial futures contracts and will be "covered" by
identifying the specific portfolio securities being hedged. Options on foreign
currencies will be covered by securities denominated in that currency. Options
on securities indices will be covered by securities that substantially replicate
the movement of the index. The Fund may not write options on more than 50% of
its total assets. Management presently intends to cease writing options if and
as long as 25% of such total assets are subject to outstanding options contracts
or if required under regulations of state securities administrators.
The Fund may write call and put options in order to obtain a return on its
investments from the premiums received and will retain the premiums whether or
not the options are exercised. Any decline in the market value of portfolio
securities or foreign currencies will be offset to the extent of the premiums
received (net of transaction costs). If an option is exercised, the premium
received on the option will effectively increase the exercise price or reduce
the difference between the exercise price and market value.
During the option period, the writer of a call option gives up the opportunity
for appreciation in the market value of the underlying security or currency
above the exercise price. It retains the risk of loss should the price of the
underlying security or foreign currency decline. Writing call options also
involves risks relating to the Fund's ability to close out options it has
written.
During the option period, the writer of a put option has assumed the risk that
the price of the underlying security or foreign currency will decline below the
exercise price. However, the writer of the put option has retained the
opportunity for an appreciation above the exercise price should the market price
of the underlying security or foreign currency increase. Writing put options
also involves risks relating to the Fund's ability to close out options it has
written.
Purchasing Call and Put Options, Warrants and Stock Rights
The Fund may invest up to an aggregate of 5% of its total assets in
exchange-traded or over-the-counter call and put options on securities and
securities indices and foreign currencies. Purchases of such options may be made
for the purpose of hedging against changes in the market value of the underlying
securities or foreign currencies. The Fund may invest in call and put options
whenever, in the opinion of the Advisor or Sub-Advisor, a hedging transaction is
consistent with its investment objectives. The Fund may sell a call option or a
put option which it has previously purchased prior to the purchase (in the case
of a call) or the sale (in the case of a put) of the underlying security or
foreign currency. Any such sale would result in a net gain or loss depending on
whether the amount received on the sale is more or less than the premium and
other transaction costs paid on the call or put which is sold. Purchasing a call
or put option involves the risk that the Fund may lose the premium it paid plus
transaction costs.
Warrants and stock rights are almost identical to call options in their nature,
use and effect except that they are issued by the issuer of the underlying
security rather than an option writer, and they generally have longer expiration
dates than call options. The Fund may invest up to 5% of its net assets in
warrants and stock rights, but no more than 2% of its net assets in warrants and
stock rights not listed on the New York Stock Exchange or the American Stock
Exchange.
Financial Futures and Related Options
The Fund may enter into financial futures contracts and related options as a
hedge against anticipated changes in the market value of their portfolio
securities or securities which they intend to purchase or in the exchange rate
of foreign currencies. Hedging is the initiation of an offsetting position in
the futures market which is intended to minimize the risk associated with a
position's underlying securities in the cash market. Investment techniques
related to financial futures and options are summarized below and are described
more fully in the Statement of Additional Information.
Financial futures contracts consist of interest rate futures contracts, foreign
currency futures contracts and securities index futures contracts. An interest
rate futures contract obligates the seller of the contract to deliver, and the
purchaser to take delivery of, the interest rate securities called for in the
contract at a specified future time and at a specified price. A foreign currency
futures contract obligates the seller of the contract to deliver, and the
purchaser to take delivery of, the foreign currency called for in the contract
at a specified future time and at a specified price. (See "Foreign Currency
Transactions.") A securities index assigns relative values to the securities
included in the index, and the index fluctuates with changes in the market
values of the securities so included. A securities index futures contract is a
bilateral agreement pursuant to which two parties agree to take or make delivery
of an amount of cash equal to a specified dollar amount times the difference
between the index value at the close of the last trading day of the contract and
the price at which the futures contract is originally struck. An option on a
financial futures contract gives the purchaser the right to assume a position in
the contract (a long position if the option is a call and a short position if
the option is a put) at a specified exercise price at any time during the period
of the option.
The Fund may purchase and sell financial futures contracts which are traded on a
recognized exchange or board of trade and may purchase exchange or board-traded
put and call options on financial futures contracts. It will engage in
transactions in financial futures contracts and related options only for hedging
purposes and not for speculation. In addition, the Fund will not purchase or
sell any financial futures contract or related option if, immediately
thereafter, the sum of the cash or U.S. Treasury bills committed with respect to
its existing futures and related options positions and the premiums paid for
related options would exceed 5% of the market value of its total assets. At the
time of purchase of a futures contract or a call option on a futures contract,
an amount of cash, U.S. Government securities or other appropriate high-grade
debt obligations equal to the market value of the futures contract minus the
Fund's initial margin deposit with respect thereto, will be deposited in a
segregated account with the Fund's custodian bank to collateralize fully the
position and thereby ensure that it is not leveraged. The extent to which the
Fund may enter into financial futures contracts and related options may also be
limited by requirements of the Internal Revenue Code of 1986 for qualification
as a regulated investment company.
Closing out a Futures Position -- Risks
The Fund may close out its position in a futures contract or an option on a
futures contract only by entering into an offsetting transaction on the exchange
on which the position was established and only if there is a liquid secondary
market for the futures contract. If it is not possible to close a futures
position entered into by the Fund, the Fund could be required to make continuing
daily cash payments of variation margin in the event of adverse price movements.
In such situations, if the Fund has insufficient cash, it may have to sell
portfolio securities to meet daily margin requirements at a time when it would
be disadvantageous to do so. The inability to close futures or options positions
could have an adverse effect on the Fund's ability to hedge effectively. There
is also risk of loss by the Fund of margin deposits in the event of bankruptcy
of a broker with whom the Fund has an open position in a futures contract. The
success of a hedging strategy depends on the Sub-Advisor's ability to predict
the direction of interest rates and other economic factors. The correlation is
imperfect between movements in the prices of futures or options contracts, and
the movements of prices of the securities which are subject to the hedge. If the
Fund used a futures or options contract to hedge against a decline in the
market, and the market later advances (or vice-versa), the Fund may suffer a
greater loss than if it had not hedged.
Foreign Currency Transactions
The value of the Fund's assets as measured in United States dollars may be
affected favorably or unfavorably by changes in foreign currency exchange rates
and exchange control regulations, and the Fund may incur costs in connection
with conversions between various currencies. The Fund will conduct its foreign
currency exchange transactions either on a spot (i.e., cash) basis at the spot
rate prevailing in the foreign currency exchange market, or through forward
contracts to purchase or sell foreign currencies. A forward foreign currency
exchange contract involves an obligation to purchase or sell a specific currency
at a future date, which may be any fixed number of days from the date of the
contract agreed upon by the parties, at a price set at the time of the contract.
These contracts are traded directly between currency traders (usually large
commercial banks) and their customers.
When the Fund enters into a contract for the purchase or sale of a security
denominated in a foreign currency, it may want to establish the United States
dollar cost or proceeds, as the case may be. By entering into a forward contract
in United States dollars for the purchase or sale of the amount of foreign
currency involved in the underlying security transaction, the Fund is able to
protect itself against a possible loss between trade and settlement dates
resulting from an adverse change in the relationship between the United States
dollar and such foreign currency. However, this tends to limit potential gains
which might result from a positive change in such currency relationships. The
Fund may also hedge its foreign currency exchange rate risk by engaging in
currency financial futures and options transactions.
When the Advisor or the Sub-Advisor believes that the currency of a particular
foreign country may suffer a substantial decline against the United States
dollar, it may enter into a forward contract to sell an amount of foreign
currency approximating the value of some or all of the Fund's portfolio
securities denominated in such foreign currency. The forecasting of short-term
currency market movement is extremely difficult and whether such a short-term
hedging strategy will be successful is highly uncertain.
It is impossible to forecast with precision the market values of portfolio
securities at the expiration of a contract. Accordingly, it may be necessary for
the Fund to purchase additional currency on the spot market (and bear the
expense of such purchase) if the market value of the security is less than the
amount of foreign currency the Fund is obligated to deliver when a decision is
made to sell the security and make delivery of the foreign currency in
settlement of a forward contract. Conversely, it may be necessary to sell on the
spot market some of the foreign currency received upon the sale of the portfolio
security if its market value exceeds the amount of foreign currency the Fund is
obligated to deliver.
If the Fund retains the portfolio security and engages in an offsetting
transaction, it will incur a gain or a loss (as described below) to the extent
that there has been movement in forward contract prices. If the Fund engages in
an offsetting transaction, it may subsequently enter into a new forward contract
to sell the foreign currency. Should forward prices decline during the period
between the Fund's entering into a forward contract for the sale of a foreign
currency and the date it enters into an offsetting contract for the purchase of
the foreign currency, it would realize gains to the extent the price of the
currency it has agreed to sell exceeds the price of the currency it has agreed
to purchase. Should forward prices increase, the Fund would suffer a loss to the
extent the price of the currency it has agreed to purchase exceeds the price of
the currency it has agreed to sell. Although such contracts tend to minimize the
risk of loss due to a decline in the value of the hedged currency, they also
tend to limit any potential gain which might result should the value of such
currency increase. The Fund may have to convert its holdings of foreign
currencies into United States dollars from time to time. Although foreign
exchange dealers do not charge a fee for conversion, they do realize a profit
based on the difference (the "spread") between the prices at which they are
buying and selling various currencies.
Repurchase agreements
Repurchase agreements are arrangements under which the Fund buys securities and
the seller simultaneously agrees to repurchase the securities at a specified
time and price. The Fund may engage in repurchase agreements to earn a higher
rate of return than it could earn simply by investing in the obligation which is
the subject of the repurchase agreement. Repurchase agreements are not, however,
without risk. In the event of the bankruptcy of a seller during the term of a
repurchase agreement, a legal question exists as to whether the Fund would be
deemed the owner of the underlying security or would be deemed only to have a
security interest in and lien upon such security. The Fund will only engage in
repurchase agreements with recognized securities dealers and banks determined to
present minimal credit risk by the Advisor under the direction and supervision
of the Fund's Board of Directors. In addition, the Fund will only engage in
repurchase agreements reasonably designed to secure fully during the term of the
agreement the seller's obligation to repurchase the underlying security and will
monitor the market value of the underlying security during the term of the
agreement. If the value of the underlying security declines and is not at least
equal to the repurchase price due the Fund pursuant to the agreement, the Fund
will require the seller to pledge additional securities or cash to secure the
seller's obligations pursuant to the agreement. If the seller defaults on its
obligation to repurchase and the value of the underlying security declines, the
Fund may incur a loss and may incur expenses in selling the underlying security.
Repurchase agreements are always for periods of less than one year, and are
considered illiquid if not terminable within seven days.
The Fund may lend its portfolio securities.
The Fund may lend its portfolio securities to member firms of the New York Stock
Exchange and commercial banks with assets of one billion dollars or more,
provided the value of the securities loaned from the Fund will not exceed 10% of
the Fund's assets. Any such loans must be secured continuously in the form of
cash or cash equivalents such as U.S. Treasury bills; the amount of the
collateral must on a current basis equal or exceed the market value of the
loaned securities, and the Fund must be able to terminate such loans upon notice
at any time. The Fund will exercise its right to terminate a securities loan in
order to preserve its right to vote upon matters of importance affecting holders
of the securities.
The advantage of such loans is that the Fund continues to receive the equivalent
of the interest earned or dividends paid by the issuers on the loaned securities
while at the same time earning interest on the cash or equivalent collateral
which may be invested in accordance with the Fund's investment objective,
policies and restrictions.
Securities loans are usually made to broker-dealers and other financial
institutions to facilitate their delivery of such securities. As with any
extension of credit, there may be risks of delay in recovery and possibly loss
of rights in the loaned securities should the borrower of the loaned securities
fail financially. However, the Fund will make loans of its portfolio securities
only to those firms the Advisor or Sub-Advisor deems creditworthy and only on
such terms the Advisor or Sub-Advisor believes should compensate for such risk.
On termination of the loan the borrower is obligated to return the securities to
the Fund. The Fund will realize any gain or loss in the market value of the
securities during the loan period. The Fund may pay reasonable custodial fees in
connection with the loan.
The Fund's investment objective and those policies set forth as fundamental
investment restrictions may not be changed without shareholder approval. The
Fund's Statement of Additional Information describes additional policies and
restrictions concerning the portfolio investments of the Fund.
High Social Impact Investments
The Fund has adopted a non-fundamental policy that permits it to invest up to
three percent of its assets in investments in securities that offer a rate of
return below the then prevailing market rate and that present attractive
opportunities for furthering the Fund's social criteria ("High Social Impact
Investments"). In applying this restriction, the percentage of assets in such
securities shall be based upon the aggregate cumulative value at the time of the
respective acquisitions of such securities currently held by the Fund. Such
securities are typically illiquid and unrated and generally considered
non-investment grade debt securities which involve a greater risk of default or
price decline than investment-grade securities. Through diversification and
credit analysis and limited maturity, investment risk can be reduced, although
there can be no assurance that losses will not occur.
Special Equities and Private Placements
Due to the particular social objective of the Fund, opportunities may exist to
promote especially promising approaches to social goals through privately placed
investments. The Special Equities Committee of the Board of Directors
identifies, evaluates, and selects these investments, subject to ratification by
the Board. The private placement investments undertaken by the Fund, if any, may
be subject to a high degree of risk. Such investments may involve relatively
small and untried enterprises that have been selected in the first instance
because of some attractive social objectives or policies.
Many private placement investments have no readily available market and may
therefore be considered illiquid. Fund investments in private placements and
other securities for which market quotations are not readily available are
valued at fair market value as determined by the Advisor or Sub-Advisor under
the direction and control of the Board.
SOCIAL SCREENS
The Fund carefully reviews company policies and behavior regarding social issues
important to global quality of life:
- -environment
- -human rights
- -nuclear energy
- -weapons systems
- -alcohol/tobacco
- -health care.
The Fund currently observes the following operating policies which may be
changed by the Fund's Board of Directors without shareholder approval: (1) the
Fund actively seeks to invest in companies that achieve excellence in both
financial return and environmental soundness, selecting issuers that take
positive steps toward preserving and enhancing our natural environment through
their operations and products, and avoiding companies with poor environmental
records; (2) the Fund will not invest in issuers which the Advisor or
Sub-Advisor ascertains contribute to human rights abuses in other countries; (3)
the Fund will not invest in producers of nuclear power or nuclear weapons, or
companies with more than 10% of revenues derived from the production or sale of
weapons systems; and (4) the Fund will not invest in companies which derive more
than 10% of revenues from the production of alcohol or tobacco products, and
actively seeks to invest in companies whose products or services improve the
quality of or access to health care, including public health and preventative
medicine.
The Fund believes that there are long-term benefits inherent in an investment
philosophy that demonstrates concern for the environment, human rights, economic
priorities, and international relations. Those enterprises which exhibit a
social awareness measured in terms of the above attributes and considerations
should be better prepared to meet future societal needs for goods and services.
By responding to social concerns, these enterprises should not only avoid the
liability that may be incurred when a product or service is determined to have a
negative social impact or has outlived its usefulness, but also be better
positioned to develop opportunities to make a profitable contribution to
society. These enterprises should be ready to respond to external demands and
ensure that over the longer term they will be viable to provide a positive
return to both investors and society as a whole.
TOTAL RETURN
The Fund may advertise total return for each class. Total return is based on
historical results and is not intended to indicate future performance.
Total return is calculated separately for each class. It includes not only the
effect of income dividends but also any change in net asset value, or principal
amount, during the stated period. The total return of a class shows its overall
change in value, including changes in share price and assuming all of the class'
dividends and capital gain distributions are reinvested. A cumulative total
return reflects the class' performance over a stated period of time. An average
annual total return reflects the hypothetical annual compounded return that
would have produced the same cumulative total return if the performance had been
constant over the entire period. Because average annual returns tend to smooth
out variations in the returns, you should recognize that they are not the same
as actual year-by-year results. Both types of total return usually will include
the effect of paying the front-end sales charge, in the case of Class A shares.
Of course, total returns will be higher if sales charges are not taken into
account. Quotations of "overall return" do not reflect deduction of the sales
charge. You should consider overall return figures only if you qualify for a
reduced sales charge, or for purposes of comparison with comparable figures
which also do not reflect sales charge, such as mutual fund averages compiled by
Lipper Analytical Services, Inc. ("Lipper"). Further information about the
Fund's performance is contained in its Annual Report to Shareholders, which may
be obtained without charge.
MANAGEMENT OF THE FUND
The Fund's Board of Directors supervises the Fund's activities and reviews its
contracts with companies that provide it with services.
The Fund is a series of Calvert World Values Fund, Inc., an open-end diversified
management investment company organized as a Maryland corporation on February
14, 1992. The other series of Calvert World Values Fund, Inc. is Calvert Capital
Accumulation Fund.
The Fund is not required to hold annual shareholder meetings, but special
meetings may be called for purposes such as electing or removing directors,
changing fundamental policies, or approving a management contract. As a
shareholder, you receive one vote for each share of the Fund you own, except
that matters affecting classes differently, such as Distribution Plans, will be
voted on separately by the affected class(es).
Calvert Asset Management serves as Advisor to the Fund.
Calvert Asset Management Company, Inc. (the "Advisor") is the Fund's investment
advisor. The Advisor provides the Fund with investment supervision and
management, administrative services and office space; furnishes executive and
other personnel to the Fund; and pays the salaries and fees of all Directors who
are affiliated persons of the Advisor. The Advisor may also assume and pay
certain advertising and promotional expenses of the Fund and reserves the right
to compensate broker-dealers in return for their promotional or administrative
services. The Fund pays all other operating expenses as noted in the Statement
of Additional Information.
The Fund's organizational expenses in the amount of $52,847 were advanced to the
Fund by the Advisor. These expenses are being amortized over a sixty-month
period which commenced on July 2, 1992. In the event that the Fund liquidates
before the deferred organization expenses are fully amortized, the Advisor shall
bear such unamortized deferred organization expenses.
The Advisor serves as investment advisor to six other registered investment
companies in the Calvert Group of Funds: First Variable Rate Fund for Government
Income; Calvert Tax-Free Reserves; Calvert Cash Reserves (doing business as
Money Management Plus); Calvert Social Investment Fund; Calvert Municipal Fund,
Inc.; and The Calvert Fund. The Advisor also serves as investment advisor to
Acacia Capital Corporation, a registered investment company whose shares are
sold to insurance companies to fund the benefits under certain variable annuity
and variable life insurance policies.
Portfolio Manager
Investment selections for the Global Equity Fund are made by the Sub-Advisor,
Murray Johnstone International, Ltd. Andrew Preston, Portfolio Manager, studied
at Melbourne University in Australia and Ritsumeikan University in Japan prior
to working for the Australian Department of Foreign Affairs. He joined Murray
Johnstone in 1985 as an analyst in the U.K. and U.S. departments, became Fund
Manager in the Japanese Department, played a prominent role in the establishment
and operation of Yamaichi-Murray Johnstone, and then began to support Murray
Johnstones growing U.S. business.
Calvert Group is one of the largest investment management firms in the
Washington, D.C. area.
Calvert Group, Ltd., parent of the Fund's investment advisor, transfer agent,
and distributor, is a subsidiary of Acacia Mutual Life Insurance Company of
Washington, D.C. Calvert Group is one of the largest investment management firms
in the Washington, D.C. area. Calvert Group, Ltd. and its subsidiaries are
located at 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. As of
December 31, 1994, Calvert Group managed and administered assets in excess of
$4.2 billion and more than 200,000 shareholder and depositor accounts.
Murray Johnstone International, Ltd. is the Fund's Sub-Advisor.
Murray Johnstone International, Ltd. (the "Sub-Advisor") is the Sub-Advisor to
the Fund. Its principal business office in the U.S. is 875 N. Michigan Avenue,
Suite 3415, Chicago, Illinois 60611. The Sub-Advisor manages the investment and
reinvestment of the assets of the Fund, although the Advisor may manage the U.S.
dollar portion of the Fund's cash reserves. The Advisor will continuously
monitor and evaluate the performance and investment style of the Sub-Advisor.
The Sub-Advisor is a wholly-owned subsidiary of United Asset Management Company.
The Advisor receives a fee based on a percentage of the Fund's assets. From
this, it pays the Sub-Advisor.
The Investment Advisory Agreement between the Fund and the Advisor provides that
the Advisor is entitled to an annual fee, payable monthly, of 1.00% of the
Fund's average daily net assets up to $250 million, 0.975% of the next $250
million, and 0.925% on assets in excess of $500 million. The Advisor may in its
discretion defer its fees or assume the Fund's operating expenses. For the year
ended September 30, 1994, no fees were waived and expenses equal to 0.50% of the
Class C average daily net assets were reimbursed for Class C Shares. The
Investment Advisory Agreement provides that the Advisor may later, to the extent
permitted by law, recapture any fees it deferred, or expenses it assumed during
the two prior years. During the 1994 fiscal year, the Advisor recaptured fees it
had deferred in 1992 from Class A Shares, equal to 0.04% of current year average
daily net assets.
The Investment Sub-Advisory Agreement between the Advisor and the Sub-Advisor
provides that the Sub-Advisor is entitled to a sub-advisory fee of 0.45% of the
Fund's average daily net assets managed by the Sub-Advisor up to $250 million,
0.425% on the next $250 million and 0.40% on such assets in excess of $500
million. The Sub-Advisor's fee is paid by the Advisor, not the Fund.
Calvert Administrative Services Company provides administrative services for the
Fund.
Calvert Administrative Services Company ("CASC"), an affiliate of the Advisor,
has been retained by the Fund to provide certain administrative services
necessary to the conduct of its affairs, including the preparation of regulatory
filings and shareholder reports, the daily determination of its net asset value
per share and dividends, and the maintenance of its portfolio and general
accounting records. For providing such services, CASC receives an annual fee,
payable monthly, from the Fund of 0.10% of the Fund's aggregate daily net assets
with a minimum fee of $40,000 per year.
Calvert Distributors, Inc. serves as underwriter to market the Fund's shares.
Calvert Distributors, Inc. ("CDI") is the Fund's principal underwriter and
distributor. Under the terms of its underwriting agreement with the Fund, CDI
markets and distributes the Fund's shares and is responsible for payment of
commissions and service fees to broker-dealers, banks, and financial services
firms, preparation of advertising and sales literature, and printing and mailing
of prospectuses to prospective investors.
The transfer agent keeps your account records.
Calvert Shareholder Services, Inc. is the Fund's transfer, dividend disbursing
and shareholder servicing agent.
SHAREHOLDER GUIDE
Opening An Account
You can buy shares of the Fund in several ways.
An account application should accompany this prospectus. A completed and signed
application is required for each new account you open, regardless of the method
you choose for making your initial investment. Additional forms may be required
from corporations, associations, and certain fiduciaries. If you have any
questions or need extra applications, call your broker, or Calvert Group at
800-368-2748. Be sure to specify which class you wish to purchase.
To invest in any of Calvert's tax-deferred retirement plans, please call Calvert
Group at 800-368-2748 to receive information and the required separate
application.
Alternative Sales Options
The Fund offers two classes of shares:
Class A Shares - Front End Load Option
Class A shares are sold with a front-end sales charge at the time of
purchase. Class A shares are not subject to a sales charge when they are
redeemed.
Class C shares - Level Load Option
Class C shares are sold without a sales charge at the time of purchase or
redemption.
Class C shares have higher expenses
The Fund bears some of the costs of selling its shares under Distribution
Plans adopted with respect to its Class A and Class C shares pursuant to
Rule 12b-1 under the 1940 Act. Payments under the Class A Distribution Plan
are limited to 0.35% annually of the average daily net asset value of Class
A shares. The Class C Distribution Plan provides for the payment of an
annual distribution fee to CDI of up to 0.75%, plus a service fee of up to
0.25%, for a total of 1.00% of the average daily net assets attributable to
Class C.
Considerations for deciding which class of shares to buy
Income distributions for Class A shares will probably be higher than those for
Class C shares, as a result of the distribution expenses described above. (See
also "Yield and Total Return.") You should consider Class A shares if you
qualify for a reduced sales charge under Class A. Other factors affecting the
class decision include the amount of the purchase or if you plan to hold the
shares for several years.
Class A Shares
Class A shares are offered at net asset value plus a front-end sales charge as
follows:
Concession to
Dealers as a %
As a % of As a % of Net of Amount
Offering Price Amount Invested Invested
Amount of Investment
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Less than $50,000 4.75% 4.99% 4.00%
$50,000 but less than $100,000 3.75% 3.90% 3.00%
$100,000 but less than $250,000 2.75% 2.83% 2.25%
$250,000 but less than $500,000 1.75% 1.78% 1.25%
$500,000 but less than $1,000,000 1.00% 1.01% 0.80%
$1,000,000 and over 0.00% 0.00% 0.25%*
*For new investments (new purchases but not exchanges) of $1 million or more a
broker-dealer will have the choice of being paid a finder's fee by CDI in one of
the following methods: (1) CDI may pay broker-dealer, on a monthly basis for 12
months, an annual rate of 0.30%. Payments will be made monthly at the rate of
0.025% of the amount of the investment, less redemptions; or (2) CDI may pay
broker-dealers 0.25% of the amount of the purchase; however, CDI reserves the
right to recoup any portion of the amount paid to the dealer if the investor
redeems some or all of the shares from the Fund within thirteen months of the
time of purchase.
Sales charges on Class A shares may be reduced or eliminated in certain cases.
See Exhibit A to this prospectus.
The sales charge is paid to CDI, which in turn normally reallows a portion to
your broker-dealer. Upon written notice to dealers with whom it has dealer
agreements, CDI may reallow up to the full applicable sales charge. Dealers to
whom 90% or more of the entire sales charge is reallowed may be deemed to be
underwriters under the Securities Act of 1933
In addition to any sales charge reallowance or finder's fee, your broker-dealer,
or other financial service firm through which your account is held, currently
will be paid periodic service fees at an annual rate of up to 0.25% of the
average daily net asset value of Class A shares held in accounts maintained by
that firm.
Class A Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class A shares (the
"Class A Distribution Plan"), which provides for payments at a maximum annual
rate of 0.35% of the average daily net asset value of Class A shares, to pay
expenses associated with the distribution and servicing of Class A shares.
Amounts paid by the Fund to CDI under the Class A Distribution Plan are used to
pay to dealers and others, including CDI salespersons who service accounts,
service fees at an annual rate of up to 0.25% of the average daily net asset
value of Class A shares, and to pay CDI for its marketing and distribution
expenses, including, but not limited to, preparation of advertising and sales
literature and the printing and mailing of prospectuses to prospective
investors. During the fiscal year ended September 30, 1994, the Fund paid Class
A Distribution Plan expenses of 0.25% of average net assets.
Each of the Distribution Plans may be terminated at any time by vote of the
Independent Directors or by vote of a majority of the outstanding voting shares
of the respective class.
Class C Shares
Class C shares are not available through all dealers. Class C shares are offered
at net asset value, without a front-end sales charge or a contingent deferred
sales charge. Class C expenses are higher than those of Class A.
Class C Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class C shares (the
"Class C Distribution Plan"), which provides for payments at an annual rate of
up to 1.00% of the average daily net asset value of Class C shares, to pay
expenses of the distribution and servicing of Class C shares. Amounts paid by
the Fund under the Class C Distribution Plan are currently used by CDI to pay
dealers and other selling firms dealer-paid quarterly compensation at an annual
rate of up to 0.75%, plus a service fee, as described above under "Class A
Distribution Plan," of up to 0.25%, of the average daily net asset value of each
share sold by such others. For the fiscal year ended September 30, 1994, the
Fund paid Class C Distribution Plan expenses of 1.00% of average net assets.
Arrangements with Broker-Dealers and Others
CDI may also pay additional concessions, including non-cash promotional
incentives, such as merchandise or trips, to dealers employing registered
representatives who have sold or are expected to sell a minimum dollar amount of
shares of the Fund and/or shares of other funds underwritten by CDI. CDI may
make expense reimbursements for special training of a dealer's registered
representatives, advertising or equipment, or to defray the expenses of sales
contests. Eligible marketing and distribution expenses may be paid pursuant to
the Fund's Rule 12b-1 Distribution Plan.
Dealers or others may receive different levels of compensation depending on
which class of shares they sell. Payments pursuant to a Distribution Plan are
included in the operating expenses of the class.
HOW TO BUY SHARES
(BE SURE TO SPECIFY WHICH CLASS YOU ARE BUYING)
Method Initial investment Additional Investments
By Mail $2,000 minimum $250 minimum
Please make your check Please make your check
payable to the Fund and payable to the Fund and
mail it with your mail it with your
application to: investment slip to:
Calvert Group Calvert Group
P.O. Box 419544 P.O. Box 419544
Kansas City, MO 64141-6544 Kansas City, MO 64141-6544
By Registered, Certified, or Overnight Mail: Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Through
Your Broker $2,000 minimum $250 minimum
At the Calvert Visit the Calvert Branch Office to make investments by
Branch Office check. See the back cover page for the address.
FOR ALL OPTIONS BELOW, PLEASE CALL YOUR BROKER OR CALVERT GROUP AT 800-368-2745
By Exchange $2,000 minimum $250 minimum
(From your account in another Calvert Group fund)
When opening an account by exchange, your new account must be established with
the same name(s), address and taxpayer identification number as your existing
Calvert account.
By Bank
Wire $2,000 minimum $250 minimum
By Calvert
Money Not Available $50 minimum
Controller* for Initial Investment
*Please allow sufficient time for Calvert Group to process your initial request
for this service, normally 10 business days. The maximum transaction amount is
$300,000, and your purchase request must be received by 4:00 p.m. Eastern time.
NET ASSET VALUE
Net asset value, or "NAV," refers to the worth of one share. NAV is computed by
adding the value of all portfolio holdings, plus other assets, deducting
liabilities and then dividing the result by the number of shares outstanding.
The NAV of each class will vary daily based on the market values of its
investments. This value is calculated at the close of the Fund's business day,
which coincides with the closing of the regular session of the New York Stock
Exchange (normally 4:00 p.m. Eastern time). The Fund is open for business each
day the New York Stock Exchange is open. All purchases of Fund shares will be
confirmed and credited to your account in full and fractional shares (rounded to
the nearest 1/1000th of a share).
Fund securities and other assets are valued based on market quotations, except
that securities maturing within 60 days are valued at amortized cost. If
quotations are not available, securities are valued by a method that the Board
of Directors believes accurately reflects fair value. Securities which are
primarily traded on foreign securities exchanges are generally valued at the
preceding closing values of such securities on their respective exchanges (See
the Statement of Additional Information -- "Determination of Net Asset Value")
relating to the valuation of foreign securities. Financial futures are valued at
the settlement price established each day by the board of trade or exchange on
which they are traded. All assets and liabilities initially expressed in foreign
currency values will be converted into United States dollars as last quoted by
any recognized dealer.
WHEN YOUR ACCOUNT WILL BE CREDITED
Before you buy shares, please read the following information to make sure your
investment is accepted and credited properly.
Your purchase will be processed at the next offering price based on the next net
asset value calculated after your order is received and accepted. If your
purchase is made by federal funds wire, or exchange, and is received by 4:00
p.m. (Eastern time), your account will be credited on the day of receipt. If
your purchase is received after 4:00 p.m. Eastern time, it will be credited the
next business day. All your purchases must be made in U.S. dollars and checks
must be drawn on U.S. banks. No cash will be accepted. The Fund reserves the
right to suspend the offering of shares for a period of time or to reject any
specific purchase order. If your check does not clear, your purchase will be
cancelled and you will be charged a $10 fee plus costs incurred by the Fund.
When you purchase by check or with Calvert Money Controller, the Fund can hold
payment on redemptions until it is reasonably satisfied that the investment is
collected (normally 10 business days from purchase date). To avoid this
collection period, you can wire federal funds from your bank, which may charge
you a fee.
Certain financial institutions or broker-dealers which have entered into a sales
agreement with the Distributor may enter confirmed purchase orders on behalf of
customers by phone, with payment to follow within a number of days of the order
as specified by the program. If payment is not received in the time specified,
the financial institution could be held liable for resulting fees or losses.
EXCHANGES
You may exchange shares of the Fund for shares of the same class of other
Calvert Group Funds.
If your investment goals change, the Calvert Group Family of Funds has a variety
of investment alternatives that includes common stock funds, tax-exempt and
corporate bond funds, and money market funds. The exchange privilege is a
convenient way to buy shares in other Calvert Group Funds in order to respond to
changes in your goals or in market conditions. However, the Fund is intended as
a long-term investment and not for frequent short-term trades. Before you make
an exchange from a Fund, please note the following:
Call your broker or a Calvert representative for information and a prospectus
for any of Calvert's other Funds registered in your state. Read the prospectus
of the Fund into which you want to exchange for relevant information, including
class offerings. The exchange privilege is only available in states where shares
of the fund into which you want to exchange are registered for sale.
Each exchange represents the sale of shares of one Fund and the purchase of
shares of another. Therefore, you could realize a taxable gain or loss on the
transaction.
Complete and sign an application for an account in that fund, taking care to
register your new account in the same name and taxpayer identification number as
your existing Calvert account(s). Exchange instructions may then be given by
telephone if you have not declined telephone transaction privileges and the
shares are not in certificate form. See "Selling Your Shares" and "How to Sell
Your Shares-- By Telephone, and--By Exchange to Another Calvert Group Fund."
Shares on which you have already paid a sales charge at Calvert Group and shares
acquired by reinvestment of dividends or distributions may be exchanged into
another fund at no additional charge.
Shareholders (and those managing multiple accounts) who make two purchases and
two exchange redemptions of shares of the same fund during any 6-month period
will be given written notice that they may be prohibited from making additional
investments. This policy does not prohibit a shareholder from redeeming shares
of the Fund, and does not apply to trades solely among money market funds.
The Fund reserves the right to terminate or modify the exchange privilege in the
future upon 60 days' written notice.
OTHER CALVERT GROUP SERVICES
Calvert Information Network
24 hour yield and prices
Calvert Group has a round-the-clock telephone service that lets existing
customers use a push button phone with tone capabilities to obtain prices,
performance information, account balances, and authorize certain transactions.
Calvert Money Controller
Calvert Money Controller eliminates the delay of mailing a check or the expense
of wiring funds. You can request this free service on your application.
This service allows you to authorize electronic transfers of money to purchase
or sell shares. You use Calvert Money Controller like an "electronic check" to
move money ($50 to $300,000) between your bank account and your account in the
Fund with one phone call. Allow one or two business days after the call for the
transfer to take place; for money recently invested, allow normal check clearing
time (up to 10 business days) before redemption proceeds are sent to your bank.
All Calvert Money Controller transaction requests must be received by 4:00 p.m.
Eastern time.
You may also arrange systematic monthly or quarterly investments (minimum $50)
into your Calvert Group account. After you give us proper authorization, your
bank account will be debited to purchase Fund shares. You will receive a
confirmation from us for these transactions, and a debit entry will appear on
your bank statement. Share purchases made through Calvert Money Controller will
be subject to the applicable sales charge. If you would like to make
arrangements for systematic monthly or quarterly redemptions from your Calvert
account, call us for a Money Controller Application.
Telephone Transactions
Calvert may record all telephone calls.
If you have telephone transaction privileges, you may purchase, redeem, or
exchange shares, wire funds and use Calvert Money Controller by telephone. You
automatically have telephone privileges unless you elect otherwise. The Fund,
the transfer agent and their affiliates are not liable for acting in good faith
on telephone instructions relating to your account, so long as they follow
reasonable procedures to determine that the telephone instructions are genuine.
Such procedures may include recording the telephone calls and requiring some
form of personal identification. You should verify the accuracy of telephone
transactions immediately upon receipt of your confirmation statement.
Optional Services
Complete the "Option" sections of the application for the easiest way to
establish services.
The easiest way to establish optional services on your Calvert Group account is
to select the options you desire when you complete your account application. If
you wish to add other options later, you may have to provide us with additional
information and a signature guarantee. Please call your broker or Calvert
Investor Relations at 800-368-2745 for further assistance. For our mutual
protection, we may require a signature guarantee on certain written transaction
requests. A signature guarantee verifies the authenticity of your signature, and
may be obtained from any bank, savings and loan association, credit union, trust
company, broker-dealer firm or member of a domestic stock exchange. A signature
guarantee cannot be provided by a notary public.
Householding of General Mailings
Householding reduces Fund expenses and saves paper and trees for the
environment.
If you have multiple accounts with Calvert, you may receive combined mailings of
some shareholder information, such as semi-annual and annual reports. Please
contact Calvert Investor Relations at 800-368-2745 to receive additional copies
of information.
Special Services and Charges
The Fund pays for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account. You may be required to pay a research fee for these special
services.
If you are purchasing shares of the Fund through a program of services offered
by a broker-dealer or financial institution, you should read the program
materials in conjunction with this Prospectus. Certain features of the Fund may
be modified in these programs, and administrative charges may be imposed for the
services rendered.
Tax-Saving Retirement Plans
Contact Calvert Group for complete information kits discussing the plans, and
their benefits, provisions and fees.
Calvert Group can set up your new account in the Fund under one of several
tax-deferred plans. These plans let you invest for retirement and shelter your
investment income from current taxes. Minimums may differ from those listed in
the chart on page __. Also, reduced sales charges may apply. See "Exhibit A -
Reduced Sales Charges."
Individual retirement accounts (IRAs): available to anyone who has earned
income. You may also be able to make investments in the name of your spouse, if
your spouse has no earned income.
Qualified Profit-Sharing and Money-Purchase Plans (including 401(k) Plans):
available to self-employed people and their partners, or to corporations and
their employees.
Simplified Employee Pension Plan (SEP-IRA): available to self-employed people
and their partners, or to corporations. Salary reduction pension plans (SAR-SEP
IRAs) are also available to employers with 25 or fewer employees.
403(b)(7) Custodial Accounts: available to employees of most non-profit
organizations and public schools and universities.
HOW TO SELL YOUR SHARES
You may redeem all or a portion of your shares on any business day. Your shares
will be redeemed at the next net asset value calculated after your redemption
request is received and accepted. See below for specific requirements necessary
to make sure your redemption request is accepted. Remember that the Fund may
hold payment on the redemption of your shares until it is reasonably satisfied
that investments made by check or by Calvert Money Controller have been
collected (normally up to 10 business days).
Redemption Requirements To Remember
To ensure acceptance of your redemption request, please follow the procedures
described here and below.
Once your shares are redeemed, the proceeds will normally be sent to you on the
next business day, but if making immediate payment could adversely affect the
Fund, it may take up to seven (7) days. Calvert Money Controller redemptions
generally will be credited to your bank account on the first or second business
day after your phone call. 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
Securities and Exchange Commission, redemptions may be suspended or payment
dates postponed.
Minimum account balance is $1,000.
Please maintain a balance in your account of at least $1,000, per class. If, due
to redemptions, it falls below $1,000, your account may be closed and the
proceeds mailed to you at the address of record. You will be given notice that
your account will be closed after 30 days unless you make an additional
investment to increase your account balance to the $1,000 minimum.
By Mail To:
Calvert Group
P.O. Box 419544
Kansas City, MO
64141-6544
You may redeem available funds from your account at any time by sending a letter
of instruction, including your name, account and Fund number, the number of
shares or dollar amount, and where you want the money to be sent. Additional
requirements, below, may apply to your account. The letter of instruction must
be signed by all required authorized signers. If you want the money to be wired
to a bank not previously authorized, then a voided bank check must be enclosed
with your letter. If you do not have a voided check or if you would like funds
sent to a different address or another person, your letter must be signature
guaranteed.
Type of Registration Requirements
Corporations, Associations Letter of instruction and corporate
resolution, signed by person(s) authorized
to act on the account, accompanied by
signature guarantee(s).
Trusts Letter of instruction signed by the
Trustee(s) (as Trustees), with a signature
guarantee. (If the Trustee's name is not
registered on your account, provide a copy
of the trust document, certified within
the last 60 days.)
By Telephone
Please call 800-368-2745. You may redeem shares from your account by telephone
and have your money mailed to your address of record or wired to an address or
bank you have previously authorized. A charge of $5 is imposed on wire transfers
of less than $1,000. See "Telephone Transactions" on page ___. If for any reason
you are unable to reach the Fund by telephone, whether due to mechanical
difficulties, heavy market volume, or otherwise, you may send a written
redemption request to the Fund by overnight mail, or, if your account is held
through a broker, see "Through Your Broker" below.
Calvert Money Controller
Please allow sufficient time for Calvert Group to process your initial request
for this service (normally 10 business days). Your request for a redemption by
this service must be received by 4:00 p.m. Eastern time. Accounts cannot be
closed by this service.
Exchange to Another Calvert Group Fund
You must meet the minimum investment requirement of the other Calvert Group
Fund. You can only exchange between accounts with identical names, addresses and
taxpayer identification number, unless previously authorized with a
signature-guaranteed letter. See "Exchanges."
Systematic Check Redemptions
If you have an account with a balance of $10,000 or more, you may have up to two
(2) regular monthly or quarterly redemption checks for $100 or more sent to you
or another recipient on the 15th of the month. This service must be authorized
in advance, with a signature-guaranteed letter.
Through your Broker
If your account is held in your broker's name ("street name"), you should
contact your broker directly to transfer, exchange or redeem shares.
DIVIDENDS AND TAXES
Each year, the Fund distributes substantially all of its net investment income
and capital gains to shareholders.
Dividends from the Fund's net investment income are declared and paid annually.
Net investment income consists of the interest income, net short-term capital
gains, if any, and dividends declared and paid on investments, less expenses.
Distributions of net long-term capital gains, if any, are normally declared and
paid by the Fund once a year; however, the Fund does not anticipate making any
such distributions unless available capital loss carryovers have been used or
have expired. Dividend and distribution payments will vary between classes;
dividend payments are anticipated to be generally higher for Class A shares.
Dividend Payment Options
Dividends and distributions are automatically reinvested in additional shares,
unless on the account application you request to have them paid to you in cash
(by check or by Calvert Money Controller). You may also request to have your
dividends and distributions from the Fund invested at net asset value ("NAV") in
shares of any other Calvert Group Fund. If you choose to have them reinvested in
the same Fund, the new shares will be purchased at the NAV (no sales charge) on
the reinvest date, which is generally 1 to 3 days prior to the payment date. You
must notify the Fund in writing prior to the record date if you want to change
your payment options. If you elect to have dividends and/or distributions paid
in cash, and the U.S. Postal Service cannot deliver the check, or if it remains
uncashed for six months, it, as well as future dividends and distributions, will
be reinvested in additional shares.
"Buying a Dividend"
At the time of purchase, the share price of the Fund may reflect undistributed
income, capital gains or unrealized appreciation of securities. Any income or
capital gains from these amounts which are later distributed to you are fully
taxable as dividends or capital gains distributions. On the record date for a
distribution, the Fund's per share value is reduced by the amount of the
distribution. If you buy shares just before the record date ("buying a
dividend") you will pay the full price for the shares and then receive a portion
of the price back as a taxable distribution.
Federal Taxes
The Fund normally distributes all net income and capital gain to shareholders.
These distributions are taxable to you regardless of whether they are taken in
cash or reinvested. Distributions of dividends and net realized short-term
capital gains are taxable as ordinary income; capital gains distributions are
taxable as long-term capital gains regardless of how long you have held the
shares. Dividends and distributions declared in December and paid in January are
taxable in the year they are declared. The Fund will mail you Form 1099-DIV in
January indicating the federal tax status of your dividends.
Distributions resulting from the sale of certain foreign currencies and debt
securities are taxed as ordinary income gain or loss. If these transactions
result in reducing the Fund's net income, a portion of the dividends may be
classified as a return of capital (which lowers your tax base). If the Fund pays
taxes to foreign governments during the year, the taxes will reduce the Fund's
dividends but will still be included in your taxable income. However, you may be
able to claim an offsetting credit or deduction on your tax return for your
portion of foreign taxes paid by the Fund.
You may realize a capital gain or loss when you sell or exchange shares.
If you sell or exchange your Fund shares you will have a short or long-term
capital gain or loss, depending on how long you owned the shares which were
sold. In January, the Fund will mail you Form 1099-B indicating the proceeds
from all sales, including exchanges. You should keep your annual year-end
account statements to determine the cost (basis) of the shares to report on your
tax returns.
Taxpayer Identification Number, Back-up Withholding
If we do not have your correct Social Security or Corporate Tax Identification
Number ("TIN") and a signed certified application or Form W-9, federal law
requires the Fund to withhold 31% of your dividends, capital gain distributions,
and redemptions. In addition, you may be subject to a fine. You will also be
prohibited from opening another account by exchange. If this TIN information is
not received within 60 days after your account is established, your account may
be redeemed at the current NAV on the date of redemption. The Fund reserves the
right to reject any new account or any purchase order for failure to supply a
certified TIN.
EXHIBIT A
REDUCED SALES CHARGES (CLASS A ONLY)
You may qualify for a reduced sales charge through several purchase plans
available. You must notify the Fund at the time of purchase to take advantage of
the reduced sales charge.
Right of Accumulation. The sales charge is calculated by taking into account not
only the dollar amount of a new purchase of shares, but also the higher of cost
or current value of shares previously purchased in Calvert Group Funds that
impose sales charges. This automatically applies to your account for each new
purchase.
Letter of Intent. If you plan to purchase $50,000 or more of Fund shares over
the next 13 months, your sales charge may be reduced through a "Letter of
Intent." You pay the lower sales charge applicable to the total amount you plan
to invest over the 13-month period, excluding any money market fund purchases.
Part of your shares will be held in escrow, so that if you do not invest the
amount indicated, you will have to pay the sales charge applicable to the
smaller investment actually made. For more information, see the Statement of
Additional Information.
Group Purchases. If you are a member of a qualified group, you may purchase
shares of the Fund at the reduced sales charge applicable to the group taken as
a whole. The sales charge is calculated by taking into account not only the
dollar amount of the shares you purchase, but also the higher of cost or current
value of shares previously purchased and currently held by other members of your
group.
A "qualified group" is one which (i) has been in existence for more than six
months, (ii) has a purpose other than acquiring Fund shares at a discount, and
(iii) satisfies uniform criteria which enable CDI and dealers offering Fund
shares to realize economies of scale in distributing such shares. A qualified
group must have more than 10 members, must be available to arrange for group
meetings between representatives of CDI or dealers distributing the Fund's
shares, must agree to include sales and other materials related to the Fund in
its publications and mailings to members at reduced or no cost to CDI or
dealers, and must seek to arrange for payroll deduction or other bulk
transmission of investments to the Fund.
Pension plans may not qualify participants for group purchases; however, such
plans may qualify for reduced sales charges under a separate provision (see
below). Members of a group are not eligible for a Letter of Intent.
Retirement Plans Under Section 457, Section 403(b)(7), or Section 401(k). There
is no sales charge on shares purchased for the benefit of a retirement plan
under Section 457 of the Internal Revenue Code of 1986, as amended ("Code"), or
for a plan qualifying under Section 403(b)(7) of the Code if, at the time of
purchase, Calvert Group has been notified in writing that the 403(b)(7) plan has
at least 200 eligible employees. Furthermore, there is no sales charge on shares
purchased for the benefit of a retirement plan qualifying under Section 401(k)
of the Code if, at the time of such purchase, the 401(k) plan administrator has
notified Calvert Group in writing that a) its 401(k) plan has at least 200
eligible employees; or b) the cost or current value of shares the plan has in
Calvert Group of Funds (except money market funds) is at least $1 million.
Neither the Fund, nor CDI, nor any affiliate thereof will reimburse a plan or
participant for any sales charges paid prior to receipt of such written
communication and confirmation by Calvert Group. Plan administrators should send
requests for the waiver of sales charges based on the above conditions to:
Calvert Group Retirement Plans, 4550 Montgomery Avenue, Suite 1000N, Bethesda,
Maryland 20814.
Other Circumstances. There is no sales charge on shares of any fund (portfolio
or series) of the Calvert Group of Funds sold to:
(1) current and retired members of the Board of Trustees/Directors of the
Calvert Group of Funds, (and the Advisory Council of the Calvert Social
Investment Fund);
(2) directors, officers and employees of the Advisor, Distributor, and
their affiliated companies;
(3) directors, officers and registered representatives of brokers
distributing the Fund's shares; and immediate family members of persons
listed in (1), (2), or (3) above;
(4) dealers, brokers, or registered investment advisors that have entered
into an agreement with CDI providing specifically for the use of shares of
the Fund (Portfolio or Series) in particular investment programs or
products (where such program or product already has a fee charged therein)
made available to the clients of such dealer, broker, or registered
investment advisor;
(5) trust departments of banks or savings institutions for trust clients of
such bank or savings institution; and
(6) purchases placed through a broker maintaining an omnibus account with
the Fund (Portfolio or Series) and the purchases are made by (a) investment
advisors or financial planners placing trades for their own accounts (or
the accounts of their clients) and who charge a management, consulting, or
other fee for their services; or (b) clients of such investment advisors or
financial planners who place trades for their own accounts if such accounts
are linked to the master account of such investment advisor or financial
planner on the books and records of the broker or agent; or (c) retirement
and deferred compensation plans and trusts, including, but not limited to,
those defined in Section 401(a) or Section 403(b) of the I.R.C., and "rabbi
trusts."
Dividends and Capital Gain Distributions from other Calvert Group Funds.
You may prearrange to have your dividends and capital gain distributions
from another Calvert Group Fund automatically invested in your account with
no additional sales charge.
Reinstatement Privilege. If you redeem Fund shares and then within 30 days
decide to reinvest in the same Fund, you may do so at the net asset value
next computed after the reinvestment order is received, without a sales
charge. You may use the reinstatement privilege only once. The Fund
reserves the right to modify or eliminate this privilege.
================================================================================
To Open an Account:
800-368-2748 Prospectus
January 31, 1995
As Revised September 30, 1995
CALVERT WORLD
VALUES FUND, INC.
Global Equity Fund
Performance and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
Service for Existing Account:
Shareholders 800-368-2745
Brokers 800-368-2746
TDD for Hearing Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail:
Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105
PRINCIPAL UNDERWRITER
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Table of Contents
Fund Expenses
Financial Highlights
Investment Objective and Policies
Risk Factors
Investment Techniques and Related Risks
Social Screens
Total Return
Management of the Fund
SHAREHOLDER GUIDE:
How to Buy Shares
Net Asset Value
When Your Account Will Be Credited
Exchanges
Other Calvert Group Services
How to Sell Your Shares
Dividends and Taxes
Exhibit A - Reduced Sales Charges
- --------
PROSPECTUS
January 31, 1995
CALVERT WORLD VALUES FUND, INC.
GLOBAL EQUITY FUND
4550 Montgomery Avenue, Bethesda, Maryland 20814
INVESTMENT OBJECTIVE
The investment objective of Calvert World Values Fund, Inc., Global Equity Fund
(the "Fund") is to achieve a high total return consistent with reasonable risk,
by investing primarily in a globally diversified portfolio of equity securities.
To the extent possible, investments are made in enterprises that make a
significant contribution to our global society through their products and
services and through the way they do business. In particular, the Fund intends
to invest a part of its assets in companies with strong interest in the
environment, human rights and health care. Investments must satisfy both the
financial and social criteria of the Fund.
PURCHASE INFORMATION
The Fund offers two classes of shares, each with different expense levels and
sales charges. You may choose to purchase (i) Class A shares, with a sales
charge imposed at the time you purchase the shares ("front-end sales charge");
or (ii) Class C shares which impose neither a front-end sales charge nor a
contingent deferred sales charge. Class C shares are not available through all
dealers. Class C shares have a higher level of expenses than Class A shares,
including higher Rule 12b-1 fees. These alternatives permit you to choose the
method of purchasing shares that is most beneficial to you, depending on the
amount of the purchase, the length of time you expect to hold the shares, and
other circumstances. See "Alternative Sales Options" for further details.
ADVISORS
Calvert Asset Management Company, Inc. is the Fund's Advisor, responsible for
overall management and supervision of the Fund's investment and day-to-day
management. Murray Johnstone International, Ltd. is the Fund's Sub-Advisor,
responsible for asset allocation and selection of the specific investments for
the Fund. See "Management of the Fund."
TO OPEN AN ACCOUNT
Call your broker, or complete and return the enclosed Account Application.
Minimum initial investment is $2,000 (may be lower for certain retirement
plans).
ABOUT THIS PROSPECTUS
Please read this Prospectus before investing. It is designed to provide you with
information you ought to know before investing and to help you decide if the
Fund's goals match your own. Keep this document for future reference.
A Statement of Additional Information (dated January 31, 1995) for the Fund has
been filed with the Securities and Exchange Commission and is incorporated by
reference. This free Statement is available upon request from the Fund:
800-368-2748.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FDIC, THE FEDERAL RESERVE
BOARD, OR ANY OTHER AGENCY. WHEN INVESTORS SELL SHARES OF THE FUND, THE VALUE
MAY BE HIGHER OR LOWER THAN THE AMOUNT ORIGINALLY PAID.
================================================================================
<TABLE>
<CAPTION>
FUND EXPENSES
Class A Class C
<S> <C> <C>
A. Shareholder Transaction Costs
Maximum Front-End Sales Charge on 4.75% None
Purchases (as a percentage of offering
price)
Contingent Deferred Sales Charge None None
B. Annual Fund Operating Expenses<F1>
Fiscal Year 1994
(as a percentage of net assets, net of
any applicable expense
reimbursement/fee waiver)
Management Fees 1.10% 1.10%
Rule 12b-1 Service and Distribution Fees
0.25% 1.00%
Other Expenses 0.64% 1.72%
Total Fund Operating Expenses 1.99% 3.82%
<FN>
<F1>Expense ratios for Class A shares have been restated to reflect expenses
anticipated for the current fiscal year.
</FN>
</TABLE>
C. Example: You would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the
end of each time period:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
Class A (Assumes payment
of maximum initial sales $67 $107 $150 $268
charge at time of purchase.)
Class C $38 $117 $197 $405
Explanation of Table: The purpose of the table is to assist you in
understanding the various costs and expenses that an investor in the
Fund would bear directly (shareholder transaction costs) or indirectly
(annual fund operating expenses).
</TABLE>
A. Shareholder Transaction Costs are charges you pay when you buy or sell shares
of the Fund. See "Reduced Sales Charges" at Exhibit A to see if you qualify for
possible reductions in the sales charge. If you request a wire redemption of
less than $1,000, you will be charged a $5 wire fee.
B. Annual Fund Operating Expenses. Management Fees are paid by the Fund to
Calvert Asset Management Company, Inc. ("Investment Advisor") for managing the
Fund's investments and business affairs. Management fees include the
Sub-Advisory fee paid by the Investment Advisor to Murray Johnstone
International, Ltd., ("Sub-Advisor"), and the Administrative Service fee paid to
Calvert Administrative Services Company. The Fund incurs Other Expenses for
maintaining shareholder records, furnishing shareholder statements and reports,
and other services. Management Fees and Other Expenses have already been
reflected in the Fund's daily share price and are not charged directly to
individual shareholder accounts. Please refer to "Management of the Fund" for
further information. The Advisor may voluntarily defer fees or assume expenses
of the Fund. For the year ended September 30, 1994, no fees were waived and
$4,980 of expenses were reimbursed for Class C Shares. The Investment Advisory
Agreement provides that the Advisor may later, to the extent permitted by law,
recapture any fees it deferred or expenses it assumed during the two prior
years; provided, however, that total Annual Fund Operating Expenses for Class A
shall not exceed 2.00% of average net assets during any year in which the
Advisor elects to exercise the recapture provision. During the 1994 fiscal year,
the Advisor recaptured $45,532 of fees it had deferred in 1992 from Class A
Shares. The above table reflects these agreements.
The Fund's Rule 12b-1 fees include an asset-based sales charge. Thus, it is
possible that long-term shareholders in the Fund may pay more in total sales
charges than the economic equivalent of the maximum front-end sales charge
permitted by rules of the National Association of Securities Dealers, Inc.
C. Example of Expenses. The example, which is hypothetical, should not be
considered a representation of past or future expenses. Actual expenses and
return may be higher or lower than those shown.
================================================================================
FINANCIAL HIGHLIGHTS
The following table provides information about the financial history of the
Fund's Class A and C shares. It expresses the information in terms of a single
share outstanding for the Fund throughout each period. The table has been
audited by Coopers & Lybrand, independent accountants, whose report on the
period from July 2, 1992 (commencement of operations) through September 30, 1994
is included in the Annual Report to Shareholders of the Fund. The table should
be read in conjunction with the financial statements and their related notes.
The Annual Report to Shareholders is incorporated by reference into the
Statement of Additional Information.
<TABLE>
<CAPTION>
Class C Shares
From Inception (March 1,
1994) To Sept. 30, 1994
<S> <C>
Net Asset Value, Beginning of Period $18.24
Income from investment operations
Net investment income (.06)
Net realized and unrealized gain (loss) on investments
(.32)
Total from investment operations (.38)
Distributions to shareholders
Distributions from net investment income --
Distribution from capital gains --
Total Distributions --
Total increase (decrease) in net asset value (.38)
Net asset value, end of period $17.86
Total return<F2> (1.27)%
Ratio of expenses to average net assets 3.32%(a)
Ratio of net income to average net assets (1.16)%(a)
Increase reflected in above net investment income ratios due
to expense reimbursement .50%(a)
Portfolio Turnover 78%
Net assets, end of period $3,620,045
Number of shares outstanding at end of period (in thousands)
203
<FN>
<F2>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
================================================================================
<TABLE>
<CAPTION>
Class A Shares
Year Ended Sept. 30,
1994
<S> <C>
Net Asset Value, Beginning of Period $16.35
Income from investment operations
Net investment income --
Net realized and unrealized gain (loss) on investments
2.14
Total from investment operations 2.14
Distributions to shareholders
Distributions from net investment income (.03)
Distributions in excess of net investment income
(.04)
Distribution from capital gains (.43)
Total Distributions (.50)
Total increase (decrease) in net asset value 1.64
Net asset value, end of period $17.99
Total return<F2> 13.44%
Ratio of expenses to average net assets 1.96%
Ratio of net income to average net assets (.04)%
Increase reflected in above net investment income ratio due
to expense reimbursement (.04)%
Portfolio Turnover 78%
Net assets, end of period $175,543,369
Number of shares outstanding at end of period (in thousands)
9,755
<FN>
<F2>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
================================================================================
<TABLE>
<CAPTION>
Class A Shares
Year Ended Sept. 30,
1993
====================
<S> <C>
Net Asset Value, Beginning of Period $14.31
Income from investment operations
Net investment income .08
Net realized and unrealized gain (loss) on investments
2.04
Total from investment operations 2.12
Distributions to shareholders
Distributions from net investment income (.05)
Distribution from capital gains (.03)
Total Distributions (.08)
Total increase (decrease) in net asset value 2.04
Net asset value, end of period $16.35
Total return<F3> 14.95%
Ratio of expenses to average net assets 1.50%
Ratio of net income to average net assets .80%
Increase reflected in above net investment income ratio due
to expense reimbursement .20%
Portfolio turnover 35%
Net assets, end of period $54,280,381
Number of shares outstanding at end of period (in thousands)
3,319
<FN>
<F3>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
================================================================================
<TABLE>
<CAPTION>
From Commencement of
Operations (July 2, 1992)
through Sept. 30, 1992
==========================
<S> <C>
Net Asset Value, Beginning of Period $15.00
Income from investment operations
Net investment income .02
Net realized and unrealized gain (loss) on investments
(.71)
Total from investment operations (.69)
Distributions to shareholders
Distributions from net investment income --
Distribution from capital gains --
Total Distributions --
Total increase (decrease) in net asset value (.69)
Net asset value, end of period $14.31
Total return<F3> (4.60)%
Ratio of expenses to average net assets 1.01%(a)
Ratio of net income to average net assets 1.23%(a)
Increase reflected in above net investment income ratio
to expense reimbursement .60%(a)
Portfolio turnover --
Net assets, end of period $8,439,650
Number of shares outstanding at end of period
(in thousand) 590
<FN>
<F3>Total return does not reflect deduction of Class A front-end sales charge.
(a) Annualized
</FN>
</TABLE>
================================================================================
INVESTMENT OBJECTIVE AND POLICIES
Investment Objective
The Fund seeks to provide a high total return consistent with reasonable risk by
investing primarily in a globally diversified portfolio of equity securities.
All investments are screened for financial and social criteria. There is, of
course, no assurance that the Fund will be successful in meeting its objective.
Under normal circumstances, the Fund will invest at least 65% of its assets in
equity securities.
The Fund will invest primarily in common stocks of established foreign and U.S.
companies believed by the Sub-Advisor to have potential for capital growth,
income or both. Companies are considered established if their securities are
traded on a recognized stock exchange. However, the Fund may invest in any other
type of security including, but not limited to, convertible securities,
preferred stocks, bonds, notes and other debt securities of companies,
(including Euro-currency instruments and securities) or of any international
agency (such as the Asian Development Bank or Inter-American Development Bank)
or obligations of domestic or foreign governments and their political
subdivisions, and in foreign currency transactions. See "Debt Obligations." The
Fund may establish and maintain reserves for temporary defensive purposes or to
enable it to take advantage of buying opportunities. The Fund's reserves may be
invested in domestic as well as foreign short-term money market instruments
including, but not limited to, U.S. and foreign government and agency
obligations, and obligations of supranational entities, certificates of deposit,
bankers' acceptances, time deposits, commercial paper, short-term corporate debt
securities and repurchase agreements. Any money market instruments will be rated
at least A-2/P-2 or better by a nationally recognized statistical rating
organization such as Standard and Poor's or Moody's, or, if unrated, determined
by the Advisor or Sub-Advisor to be of equivalent credit quality. The Fund may
also engage in certain options transactions, and enter into futures contracts
and related options for hedging purposes. (See "Investment Techniques and
Risks.")
Under normal circumstances, the Fund will invest at least 65% of its assets in
the securities of issuers in no less than three countries, one of which may be
the USA.
The Fund makes investments in various countries. Under normal circumstances,
business activities in a number of different foreign countries will be
represented in the Fund's investments. The Fund may, from time to time, have
more than 25% of its assets invested in any major industrial or developed
country which in the view of the Sub-Advisor poses no unique investment risk.
The Sub-Advisor considers an investment in a given foreign country to have "no
unique investment risk" if the Fund's investment in that country is not
disproportionate to the relative size of the country's market versus the Morgan
Stanley Capital International Europe-Far East-Asia (EFEA) or World Index or
other comparable index, and if the capital markets in that country are mature,
and of sufficient liquidity and depth. Under exceptional economic or market
conditions, the Fund may invest substantially all of its assets in only one or
two countries, or in U.S. government obligations or securities of companies
incorporated in and having their principal activities in the U.S.
The Sub-Advisor considers several factors in determining the various countries
in which to invest.
In determining the appropriate distribution of investments among various
countries and geographic regions, the Sub-Advisor ordinarily will consider the
following factors: prospects for relative economic growth among foreign
countries; expected levels of inflation; relative price levels of the various
capital markets; government policies influencing business conditions; the
outlook for currency relationships and the range of individual investment
opportunities available to the global investor. The Fund may make investments in
developing countries, which involve exposure to economic structures that are
generally less diverse and mature than in the United States, and to political
systems which may be less stable. A country is considered to be a developing
country if it is not included in the Morgan Stanley Capital International World
Index. Examples of developing countries would currently include countries such
as Argentina, Brazil, Indonesia, Taiwan, Mexico, Turkey, Chile, India, and
Korea. Investing in developing countries often involves risk of high inflation,
high sensitivity to commodity prices, and government ownership of the biggest
industries in that country. Investing in developing countries also involves a
higher probability of occurrence of the risks of investing in foreign securities
in general, including but not limited to, less financial information available,
relatively illiquid markets, and the possibility of adverse government action
(see "Risk Factors" below). No more than 30% of the Fund's net assets may be
invested in the securities of issuers located in developing countries. In the
past, markets of developing countries have been more volatile than the markets
of developed countries; however, such markets often have provided higher
long-term rates of return to investors. The Sub-Advisor believes that these
characteristics may be expected to continue in the future.
Generally, the Fund will not trade in securities for short-term profits, but,
when circumstances warrant, securities may be sold without regard to the length
of time held.
Debt obligations
Although the Fund invests primarily in equity securities, it may invest up to
35% of its net assets in debt securities, excluding money market instruments. Of
this, at least 30% will be of the highest credit quality available (rated AAA or
Aaa by Standard & Poor's (S&P) or Moody's, respectively, or if not rated by S&P
or Moody's, then determined by the Sub-Advisor to be of equivalent credit
quality). All fixed income instruments are subject to interest-rate risk; that
is, when market interest rates rise, the current principal value of a bond will
decline. The remaining 5% of Fund assets that may be invested in debt securities
may be rated lower than AAA or Aaa, but in no event lower than BBB or Baa, or,
if unrated, then determined by the Sub-Advisor to be of equivalent credit
quality. The Sub-Advisor does not intend to purchase any bonds rated lower than
AAA unless the instrument provides an opportunity to invest in an attractive
company in which an equity investment is not currently available or desirable.
The Fund will not buy any bonds rated less than investment grade. If a change in
credit quality after acquisition by the Fund causes the bond to no longer be
investment grade, the Sub-Advisor, will generally dispose of the bond if
necessary to keep its holdings, if any, of such bonds to 5% or less of the
Fund's assets. See the Statement of Additional Information, "Credit Quality" and
"Appendix--Corporate Bond and Commercial Paper Ratings" for more information on
bond ratings and credit quality.
Foreign Government Securities
The Sub-Advisor may from time to time invest in the debt instruments of foreign
sovereign governments. These may include short-term treasury bills, notes and
long-term bonds, and will only be considered for investment by the Fund if they
have the full guarantee of the government in question. The Sub-Advisor will not
invest in foreign government securities with a rating by Moody's Investors
Services lower than AA2.
RISK FACTORS
An investment in the Fund is subject to various risks. The net asset value will
fluctuate in response to changes in market conditions and the value of the
Fund's portfolio investments. The Fund's use of certain investment techniques,
such as foreign currency options, involve special risks. See "Investment
Techniques and Related Risks."
There are substantial and different risks involved in investing in foreign
securities. You should consider these risks carefully. For example, there is
generally less publicly available information about foreign companies than is
available about companies in the U.S. Foreign companies are not subject to
uniform audit and financial reporting standards, practices and requirements
comparable to those in the U.S.
Foreign securities involve currency risks. The U.S. dollar value of a foreign
security tends to decrease when the value of the dollar rises against the
foreign currency in which the security is denominated and tends to increase when
the value of the dollar falls against such currency. Fluctuations in exchange
rates may also affect the earning power and asset value of the foreign entity
issuing the security. Dividend and interest payments may be returned to the
country of origin, based on the exchange rate at the time of disbursement, and
restrictions on capital flows may be imposed. Losses and other expenses may be
incurred in converting between various currencies in connections with purchases
and sales of foreign securities.
Foreign stock markets are generally not as developed or efficient as those in
the U.S. In most foreign markets volume and liquidity are less than in the U.S.
and, at times, volatility of price can be greater than that in the U.S. Fixed
commissions on foreign stock exchanges are generally higher than the negotiated
commissions on U.S. exchanges. There is generally less government supervision
and regulation of foreign stock exchanges, brokers and companies than in the
U.S.
There is also the possibility of adverse changes in investment or exchange
control regulations, expropriation or confiscatory taxation, limitations on the
removal of funds or other assets, political or social instability, or diplomatic
developments which could adversely affect investments, assets or securities
transactions of the Fund in some foreign countries. The Fund is not aware of any
investment or exchange control regulations which might substantially impair the
operations of the Fund as described, although this could change at any time.
For many foreign securities, there are U.S. dollar-denominated American
Depository Receipts ("ADRs"), which are traded in the U.S. on exchanges or over
the counter and are generally sponsored and issued by domestic banks. ADRs are
receipts typically issued by a U.S. bank or trust company which evidence
ownership of underlying securities of a foreign corporation. ADRs do not
eliminate all the risk inherent in investing in the securities of foreign
issuers. However, by investing in ADRs rather than directly in foreign issuers'
stock, the Fund can avoid currency risks and some liquidity risks during the
settlement period for either purchases or sales. The information available for
ADRs is subject to the more uniform and more exacting accounting, auditing and
financial reporting standards of the domestic market or exchange on which they
are traded. In general, there is a large, liquid market in the U.S. for many
ADRs. The Fund may also invest in European Depository Receipts ("EDRs"), which
are receipts evidencing an arrangement with a European bank similar to that for
ADRs and are designed for use in the European securities markets. EDRs are not
necessarily denominated in the currency of the underlying security.
The dividends and interest payable on certain of the Fund's foreign securities
may be subject to foreign withholding taxes, thus reducing the net amount
available for distribution to the Fund's shareholders. You should understand
that the expense ratio of the Fund can be expected to be higher than those of
investment companies investing only in domestic securities since the costs of
operations are higher.
INVESTMENT TECHNIQUES and RELATED RISKS
The Fund may write covered call options and purchase call and put options on
securities and security indices, and may write secured put options and enter
into option transactions on foreign currency. It may also engage in transactions
in financial futures contracts and related options for hedging purposes, and
invest in repurchase agreements. These investment techniques and the related
risks are summarized below and are described in more detail in the Statement of
Additional Information.
Writing (Selling) Call and Put Options
A call option on a security, security index or a foreign currency gives the
purchaser of the option, in return for the premium paid to the writer (seller),
the right to buy the underlying security, index or foreign currency at the
exercise price at any time during the option period. Upon exercise by the
purchaser, the writer of a call option on an individual security or foreign
currency has the obligation to sell the underlying security or currency at the
exercise price. A call option on a securities index is similar to a call option
on an individual security, except that the value of the option depends on the
weighted value of the group of securities comprising the index and all
settlements are to be made in cash. A call option may be terminated by the
writer (seller) by entering into a closing purchase transaction in which it
purchases an option of the same series as the option previously written.
A put option on a security, security index, or foreign currency gives the
purchaser of the option, in return for the premium paid to the writer (seller),
the right to sell the underlying security, index, or foreign currency at the
exercise price at any time during the option period.
Upon exercise by the purchaser, the writer of a put option has the obligation to
purchase the underlying security or foreign currency at the exercise price. A
put option on a securities index is similar to a put option on an individual
security, except that the value of the option depends on the weighted value of
the group of securities comprising the index and all settlements are made in
cash.
The Fund may write exchange-traded call options on its securities. Call options
may be written on portfolio securities, securities indices, or foreign
currencies. With respect to securities and foreign currencies, the Fund may
write call and put options on an exchange or over-the-counter. Call options on
portfolio securities will be covered since the Fund will own the underlying
securities. Call options on securities indices will be written only to hedge in
an economically appropriate way portfolio securities which are not otherwise
hedged with options or financial futures contracts and will be "covered" by
identifying the specific portfolio securities being hedged. Options on foreign
currencies will be covered by securities denominated in that currency. Options
on securities indices will be covered by securities that substantially replicate
the movement of the index. The Fund may not write options on more than 50% of
its total assets. Management presently intends to cease writing options if and
as long as 25% of such total assets are subject to outstanding options contracts
or if required under regulations of state securities administrators.
The Fund may write call and put options in order to obtain a return on its
investments from the premiums received and will retain the premiums whether or
not the options are exercised. Any decline in the market value of portfolio
securities or foreign currencies will be offset to the extent of the premiums
received (net of transaction costs). If an option is exercised, the premium
received on the option will effectively increase the exercise price or reduce
the difference between the exercise price and market value.
During the option period, the writer of a call option gives up the opportunity
for appreciation in the market value of the underlying security or currency
above the exercise price. It retains the risk of loss should the price of the
underlying security or foreign currency decline. Writing call options also
involves risks relating to the Fund's ability to close out options it has
written.
During the option period, the writer of a put option has assumed the risk that
the price of the underlying security or foreign currency will decline below the
exercise price. However, the writer of the put option has retained the
opportunity for an appreciation above the exercise price should the market price
of the underlying security or foreign currency increase. Writing put options
also involves risks relating to the Fund's ability to close out options it has
written.
Purchasing Call and Put Options, Warrants and Stock Rights
The Fund may invest up to an aggregate of 5% of its total assets in
exchange-traded or over-the-counter call and put options on securities and
securities indices and foreign currencies. Purchases of such options may be made
for the purpose of hedging against changes in the market value of the underlying
securities or foreign currencies. The Fund may invest in call and put options
whenever, in the opinion of the Advisor or Sub-Advisor, a hedging transaction is
consistent with its investment objectives. The Fund may sell a call option or a
put option which it has previously purchased prior to the purchase (in the case
of a call) or the sale (in the case of a put) of the underlying security or
foreign currency. Any such sale would result in a net gain or loss depending on
whether the amount received on the sale is more or less than the premium and
other transaction costs paid on the call or put which is sold. Purchasing a call
or put option involves the risk that the Fund may lose the premium it paid plus
transaction costs.
Warrants and stock rights are almost identical to call options in their nature,
use and effect except that they are issued by the issuer of the underlying
security rather than an option writer, and they generally have longer expiration
dates than call options. The Fund may invest up to 5% of its net assets in
warrants and stock rights, but no more than 2% of its net assets in warrants and
stock rights not listed on the New York Stock Exchange or the American Stock
Exchange.
Financial Futures and Related Options
The Fund may enter into financial futures contracts and related options as a
hedge against anticipated changes in the market value of their portfolio
securities or securities which they intend to purchase or in the exchange rate
of foreign currencies. Hedging is the initiation of an offsetting position in
the futures market which is intended to minimize the risk associated with a
position's underlying securities in the cash market. Investment techniques
related to financial futures and options are summarized below and are described
more fully in the Statement of Additional Information.
Financial futures contracts consist of interest rate futures contracts, foreign
currency futures contracts and securities index futures contracts. An interest
rate futures contract obligates the seller of the contract to deliver, and the
purchaser to take delivery of, the interest rate securities called for in the
contract at a specified future time and at a specified price. A foreign currency
futures contract obligates the seller of the contract to deliver, and the
purchaser to take delivery of, the foreign currency called for in the contract
at a specified future time and at a specified price. (See "Foreign Currency
Transactions.") A securities index assigns relative values to the securities
included in the index, and the index fluctuates with changes in the market
values of the securities so included. A securities index futures contract is a
bilateral agreement pursuant to which two parties agree to take or make delivery
of an amount of cash equal to a specified dollar amount times the difference
between the index value at the close of the last trading day of the contract and
the price at which the futures contract is originally struck. An option on a
financial futures contract gives the purchaser the right to assume a position in
the contract (a long position if the option is a call and a short position if
the option is a put) at a specified exercise price at any time during the period
of the option.
The Fund may purchase and sell financial futures contracts which are traded on a
recognized exchange or board of trade and may purchase exchange or board-traded
put and call options on financial futures contracts. It will engage in
transactions in financial futures contracts and related options only for hedging
purposes and not for speculation. In addition, the Fund will not purchase or
sell any financial futures contract or related option if, immediately
thereafter, the sum of the cash or U.S. Treasury bills committed with respect to
its existing futures and related options positions and the premiums paid for
related options would exceed 5% of the market value of its total assets. At the
time of purchase of a futures contract or a call option on a futures contract,
an amount of cash, U.S. Government securities or other appropriate high-grade
debt obligations equal to the market value of the futures contract minus the
Fund's initial margin deposit with respect thereto, will be deposited in a
segregated account with the Fund's custodian bank to collateralize fully the
position and thereby ensure that it is not leveraged. The extent to which the
Fund may enter into financial futures contracts and related options may also be
limited by requirements of the Internal Revenue Code of 1986 for qualification
as a regulated investment company.
Closing out a Futures Position -- Risks
The Fund may close out its position in a futures contract or an option on a
futures contract only by entering into an offsetting transaction on the exchange
on which the position was established and only if there is a liquid secondary
market for the futures contract. If it is not possible to close a futures
position entered into by the Fund, the Fund could be required to make continuing
daily cash payments of variation margin in the event of adverse price movements.
In such situations, if the Fund has insufficient cash, it may have to sell
portfolio securities to meet daily margin requirements at a time when it would
be disadvantageous to do so. The inability to close futures or options positions
could have an adverse effect on the Fund's ability to hedge effectively. There
is also risk of loss by the Fund of margin deposits in the event of bankruptcy
of a broker with whom the Fund has an open position in a futures contract. The
success of a hedging strategy depends on the Sub-Advisor's ability to predict
the direction of interest rates and other economic factors. The correlation is
imperfect between movements in the prices of futures or options contracts, and
the movements of prices of the securities which are subject to the hedge. If a
Fund used a futures or options contract to hedge against a decline in the
market, and the market later advances (or vice-versa), the Fund may suffer a
greater loss than if it had not hedged.
Foreign Currency Transactions
The value of the Fund's assets as measured in United States dollars may be
affected favorably or unfavorably by changes in foreign currency exchange rates
and exchange control regulations, and the Fund may incur costs in connection
with conversions between various currencies. The Fund will conduct its foreign
currency exchange transactions either on a spot (i.e., cash) basis at the spot
rate prevailing in the foreign currency exchange market, or through forward
contracts to purchase or sell foreign currencies. A forward foreign currency
exchange contract involves an obligation to purchase or sell a specific currency
at a future date, which may be any fixed number of days from the date of the
contract agreed upon by the parties, at a price set at the time of the contract.
These contracts are traded directly between currency traders (usually large
commercial banks) and their customers.
When the Fund enters into a contract for the purchase or sale of a security
denominated in a foreign currency, it may want to establish the United States
dollar cost or proceeds, as the case may be. By entering into a forward contract
in United States dollars for the purchase or sale of the amount of foreign
currency involved in the underlying security transaction, the Fund is able to
protect itself against a possible loss between trade and settlement dates
resulting from an adverse change in the relationship between the United States
dollar and such foreign currency. However, this tends to limit potential gains
which might result from a positive change in such currency relationships. The
Fund may also hedge its foreign currency exchange rate risk by engaging in
currency financial futures and options transactions.
When the Advisor or the Sub-Advisor believes that the currency of a particular
foreign country may suffer a substantial decline against the United States
dollar, it may enter into a forward contract to sell an amount of foreign
currency approximating the value of some or all of the Fund's portfolio
securities denominated in such foreign currency. The forecasting of short-term
currency market movement is extremely difficult and whether such a short-term
hedging strategy will be successful is highly uncertain.
It is impossible to forecast with precision the market values of portfolio
securities at the expiration of a contract. Accordingly, it may be necessary for
the Fund to purchase additional currency on the spot market (and bear the
expense of such purchase) if the market value of the security is less than the
amount of foreign currency the Fund is obligated to deliver when a decision is
made to sell the security and make delivery of the foreign currency in
settlement of a forward contract. Conversely, it may be necessary to sell on the
spot market some of the foreign currency received upon the sale of the portfolio
security if its market value exceeds the amount of foreign currency the Fund is
obligated to deliver.
If the Fund retains the portfolio security and engages in an offsetting
transaction, it will incur a gain or a loss (as described below) to the extent
that there has been movement in forward contract prices. If the Fund engages in
an offsetting transaction, it may subsequently enter into a new forward contract
to sell the foreign currency. Should forward prices decline during the period
between the Fund's entering into a forward contract for the sale of a foreign
currency and the date it enters into an offsetting contract for the purchase of
the foreign currency, it would realize gains to the extent the price of the
currency it has agreed to sell exceeds the price of the currency it has agreed
to purchase. Should forward prices increase, the Fund would suffer a loss to the
extent the price of the currency it has agreed to purchase exceeds the price of
the currency it has agreed to sell. Although such contracts tend to minimize the
risk of loss due to a decline in the value of the hedged currency, they also
tend to limit any potential gain which might result should the value of such
currency increase. The Fund may have to convert its holdings of foreign
currencies into United States dollars from time to time. Although foreign
exchange dealers do not charge a fee for conversion, they do realize a profit
based on the difference (the "spread") between the prices at which they are
buying and selling various currencies.
Repurchase agreements
Repurchase agreements are arrangements under which the Fund buys securities and
the seller simultaneously agrees to repurchase the securities at a specified
time and price. The Fund may engage in repurchase agreements to earn a higher
rate of return than it could earn simply by investing in the obligation which is
the subject of the repurchase agreement. Repurchase agreements are not, however,
without risk. In the event of the bankruptcy of a seller during the term of a
repurchase agreement, a legal question exists as to whether the Fund would be
deemed the owner of the underlying security or would be deemed only to have a
security interest in and lien upon such security. The Fund will only engage in
repurchase agreements with recognized securities dealers and banks determined to
present minimal credit risk by the Advisor under the direction and supervision
of the Fund's Board of Directors. In addition, the Fund will only engage in
repurchase agreements reasonably designed to secure fully during the term of the
agreement the seller's obligation to repurchase the underlying security and will
monitor the market value of the underlying security during the term of the
agreement. If the value of the underlying security declines and is not at least
equal to the repurchase price due the Fund pursuant to the agreement, the Fund
will require the seller to pledge additional securities or cash to secure the
seller's obligations pursuant to the agreement. If the seller defaults on its
obligation to repurchase and the value of the underlying security declines, the
Fund may incur a loss and may incur expenses in selling the underlying security.
Repurchase agreements are always for periods of less than one year, and are
considered illiquid if not terminable within seven days.
The Fund may lend its portfolio securities.
The Fund may lend its portfolio securities to member firms of the New York Stock
Exchange and commercial banks with assets of one billion dollars or more,
provided the value of the securities loaned from the Fund will not exceed 10% of
the Fund's assets. Any such loans must be secured continuously in the form of
cash or cash equivalents such as U.S. Treasury bills; the amount of the
collateral must on a current basis equal or exceed the market value of the
loaned securities, and the Fund must be able to terminate such loans upon notice
at any time. The Fund will exercise its right to terminate a securities loan in
order to preserve its right to vote upon matters of importance affecting holders
of the securities.
The advantage of such loans is that the Fund continues to receive the equivalent
of the interest earned or dividends paid by the issuers on the loaned securities
while at the same time earning interest on the cash or equivalent collateral
which may be invested in accordance with the Fund's investment objective,
policies and restrictions.
Securities loans are usually made to broker-dealers and other financial
institutions to facilitate their delivery of such securities. As with any
extension of credit, there may be risks of delay in recovery and possibly loss
of rights in the loaned securities should the borrower of the loaned securities
fail financially. However, the Fund will make loans of its portfolio securities
only to those firms the Advisor or Sub-Advisor deems creditworthy and only on
such terms the Advisor or Sub-Advisor believes should compensate for such risk.
On termination of the loan the borrower is obligated to return the securities to
the Fund. The Fund will realize any gain or loss in the market value of the
securities during the loan period. The Fund may pay reasonable custodial fees in
connection with the loan.
The Fund's investment objective and those policies set forth as fundamental
investment restrictions may not be changed without shareholder approval. The
Fund's Statement of Additional Information describes additional policies and
restrictions concerning the portfolio investments of the Fund.
High Social Impact Investments
The Fund has adopted a non-fundamental policy that permits it to invest up to
three percent of its assets in investments in securities that offer a rate of
return below the then prevailing market rate and that present attractive
opportunities for furthering the Fund's social criteria ("High Social Impact
Investments"). In applying this restriction, the percentage of assets in such
securities shall be based upon the aggregate cumulative value at the time of the
respective acquisitions of such securities currently held by the Fund. Such
securities are typically illiquid and unrated and generally considered
non-investment grade debt securities which involve a greater risk of default or
price decline than investment-grade securities. Through diversification and
credit analysis and limited maturity, investment risk can be reduced, although
there can be no assurance that losses will not occur.
Special Equities and Private Placements
Due to the particular social objective of the Fund, opportunities may exist to
promote especially promising approaches to social goals through privately placed
investments. The Special Equities Committee of the Board of Directors
identifies, evaluates, and selects these investments, subject to ratification by
the Board. The private placement investments undertaken by the Fund, if any, may
be subject to a high degree of risk. Such investments may involve relatively
small and untried enterprises that have been selected in the first instance
because of some attractive social objectives or policies.
Many private placement investments have no readily available market and may
therefore be considered illiquid. Fund investments in private placements and
other securities for which market quotations are not readily available are
valued at fair market value as determined by the Advisor or Sub-Advisor under
the direction and control of the Board.
SOCIAL SCREENS
The Fund carefully reviews company policies and behavior regarding social issues
important to global quality of life:
- -environment
- -human rights
- -nuclear energy
- -weapons systems
- -alcohol/tobacco
- -health care.
The Fund currently observes the following operating policies which may be
changed by the Fund's Board of Directors without shareholder approval: (1) the
Fund actively seeks to invest in companies that achieve excellence in both
financial return and environmental soundness, selecting issuers that take
positive steps toward preserving and enhancing our natural environment through
their operations and products, and avoiding companies with poor environmental
records; (2) the Fund will not invest in issuers which the Advisor or
Sub-Advisor ascertains contribute to human rights abuses in other countries; (3)
the Fund will not invest in producers of nuclear power or nuclear weapons, or
companies with more than 10% of revenues derived from the production or sale of
weapons systems; and (4) the Fund will not invest in companies which derive more
than 10% of revenues from the production of alcohol or tobacco products, and
actively seeks to invest in companies whose products or services improve the
quality of or access to health care, including public health and preventative
medicine.
The Fund believes that there are long-term benefits inherent in an investment
philosophy that demonstrates concern for the environment, human rights, economic
priorities, and international relations. Those enterprises which exhibit a
social awareness measured in terms of the above attributes and considerations
should be better prepared to meet future societal needs for goods and services.
By responding to social concerns, these enterprises should not only avoid the
liability that may be incurred when a product or service is determined to have a
negative social impact or has outlived its usefulness, but also be better
positioned to develop opportunities to make a profitable contribution to
society. These enterprises should be ready to respond to external demands and
ensure that over the longer term they will be viable to provide a positive
return to both investors and society as a whole.
TOTAL RETURN
The Fund may advertise total return for each class. Total return is based on
historical results and is not intended to indicate future performance.
Total return is calculated separately for each class. It includes not only the
effect of income dividends but also any change in net asset value, or principal
amount, during the stated period. The total return of a class shows its overall
change in value, including changes in share price and assuming all of the class'
dividends and capital gain distributions are reinvested. A cumulative total
return reflects the class' performance over a stated period of time. An average
annual total return reflects the hypothetical annual compounded return that
would have produced the same cumulative total return if the performance had been
constant over the entire period. Because average annual returns tend to smooth
out variations in the returns, you should recognize that they are not the same
as actual year-by-year results. Both types of total return usually will include
the effect of paying the front-end sales charge, in the case of Class A shares.
Of course, total returns will be higher if sales charges are not taken into
account. Quotations of "overall return" do not reflect deduction of the sales
charge. You should consider overall return figures only if you qualify for a
reduced sales charge, or for purposes of comparison with comparable figures
which also do not reflect sales charge, such as mutual fund averages compiled by
Lipper Analytical Services, Inc. ("Lipper"). Further information about the
Fund's performance is contained in its Annual Report to Shareholders, which may
be obtained without charge.
MANAGEMENT OF THE FUND
The Fund's Board of Directors supervises the Fund's activities and reviews its
contracts with companies that provide it with services.
The Fund is a series of Calvert World Values Fund, Inc., an open-end diversified
management investment company organized as a Maryland corporation on February
14, 1992. The other series of Calvert World Values Fund, Inc. is Calvert Capital
Accumulation Fund.
The Fund is not required to hold annual shareholder meetings, but special
meetings may be called for purposes such as electing or removing directors,
changing fundamental policies, or approving a management contract. As a
shareholder, you receive one vote for each share of the Fund you own, except
that matters affecting classes differently, such as Distribution Plans, will be
voted on separately by the affected class(es).
Calvert Asset Management serves as Advisor to the Fund.
Calvert Asset Management Company, Inc. (the "Advisor") is the Fund's investment
advisor. The Advisor provides the Fund with investment supervision and
management, administrative services and office space; furnishes executive and
other personnel to the Fund; and pays the salaries and fees of all Directors who
are affiliated persons of the Advisor. The Advisor may also assume and pay
certain advertising and promotional expenses of the Fund and reserves the right
to compensate broker-dealers in return for their promotional or administrative
services. The Fund pays all other operating expenses as noted in the Statement
of Additional Information.
The Fund's organizational expenses in the amount of $52,847 were advanced to the
Fund by the Advisor. These expenses are being amortized over a sixty-month
period which commenced on July 2, 1992. In the event that the Fund liquidates
before the deferred organization expenses are fully amortized, the Advisor shall
bear such unamortized deferred organization expenses.
The Advisor serves as investment advisor to six other registered investment
companies in the Calvert Group of Funds: First Variable Rate Fund for Government
Income; Calvert Tax-Free Reserves; Calvert Cash Reserves (doing business as
Money Management Plus); Calvert Social Investment Fund; Calvert Municipal Fund,
Inc.; and The Calvert Fund. The Advisor also serves as investment advisor to
Acacia Capital Corporation, a registered investment company whose shares are
sold to insurance companies to fund the benefits under certain variable annuity
and variable life insurance policies.
Portfolio Manager
Investment selections for the Global Equity Fund are made by the Sub-Advisor,
Murray Johnstone International, Ltd. Andrew Preston, Portfolio Manager, studied
at Melbourne University in Australia and Ritsumeikan University in Japan prior
to working for the Australian Department of Foreign Affairs. He joined Murray
Johnstone in 1985 as an analyst in the U.K. and U.S. departments, became Fund
Manager in the Japanese Department, played a prominent role in the establishment
and operation of Yamaichi-Murray Johnstone, and then began to support Murray
Johnstones growing U.S. business.
Calvert Group is one of the largest investment management firms in the
Washington, D.C. area.
Calvert Group, Ltd., parent of the Fund's investment advisor, transfer agent,
and distributor, is a subsidiary of Acacia Mutual Life Insurance Company of
Washington, D.C. Calvert Group is one of the largest investment management firms
in the Washington, D.C. area. Calvert Group, Ltd. and its subsidiaries are
located at 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814. As of
December 31, 1994, Calvert Group managed and administered assets in excess of
$4.2 billion and more than 200,000 shareholder and depositor accounts.
Murray Johnstone International, Ltd. is the Fund's Sub-Advisor.
Murray Johnstone International, Ltd. (the "Sub-Advisor") is the Sub-Advisor to
the Fund. Its principal business office in the U.S. is 875 N. Michigan Avenue,
Suite 3415, Chicago, Illinois 60611. The Sub-Advisor manages the investment and
reinvestment of the assets of the Fund, although the Advisor may manage the U.S.
dollar portion of the Fund's cash reserves. The Advisor will continuously
monitor and evaluate the performance and investment style of the Sub-Advisor.
The Sub-Advisor is a wholly-owned subsidiary of United Asset Management Company.
The Advisor receives a fee based on a percentage of the Fund's assets. From
this, it pays the Sub-Advisor.
The Investment Advisory Agreement between the Fund and the Advisor provides that
the Advisor is entitled to an annual fee, payable monthly, of 1.00% of the
Fund's average daily net assets up to $250 million, 0.975% of the next $250
million, and 0.925% on assets in excess of $500 million. The Advisor may in its
discretion defer its fees or assume the Fund's operating expenses. For the year
ended September 30, 1994, no fees were waived and expenses equal to 0.50% of the
Class C average daily net assets were reimbursed for Class C Shares. The
Investment Advisory Agreement provides that the Advisor may later, to the extent
permitted by law, recapture any fees it deferred, or expenses it assumed during
the two prior years. During the 1994 fiscal year, the Advisor recaptured fees it
had deferred in 1992 from Class A Shares, equal to 0.04% of current year average
daily net assets.
The Investment Sub-Advisory Agreement between the Advisor and the Sub-Advisor
provides that the Sub-Advisor is entitled to a sub-advisory fee of 0.45% of the
Fund's average daily net assets managed by the Sub-Advisor up to $250 million,
0.425% on the next $250 million and 0.40% on such assets in excess of $500
million. The Sub-Advisor's fee is paid by the Advisor, not the Fund.
Calvert Administrative Services Company provides administrative services for the
Fund.
Calvert Administrative Services Company ("CASC"), an affiliate of the Advisor,
has been retained by the Fund to provide certain administrative services
necessary to the conduct of its affairs, including the preparation of regulatory
filings and shareholder reports, the daily determination of its net asset value
per share and dividends, and the maintenance of its portfolio and general
accounting records. For providing such services, CASC receives an annual fee,
payable monthly, from the Fund of 0.10% of the Fund's average daily net assets
with a minimum fee of $40,000 per year.
Calvert Distributors, Inc. serves as underwriter to market the Fund's shares.
Effective March 1, 1995, Calvert Distributors, Inc. ("CDI") is the Fund's
principal underwriter and distributor. Under the terms of its underwriting
agreement with the Fund, CDI markets and distributes the Fund's shares and is
responsible for payment of commissions and service fees to broker-dealers,
banks, and financial services firms, preparation of advertising and sales
literature, and printing and mailing of prospectuses to prospective investors.
The transfer agent keeps your account records.
Calvert Shareholder Services, Inc. is the Fund's transfer, dividend disbursing
and shareholder servicing agent.
SHAREHOLDER GUIDE
Opening An Account
You can buy shares of the Fund in several ways.
An account application should accompany this prospectus. A completed and signed
application is required for each new account you open, regardless of the method
you choose for making your initial investment. Additional forms may be required
from corporations, associations, and certain fiduciaries. If you have any
questions or need extra applications, call your broker, or Calvert Group at
800-368-2748. Be sure to specify which class you wish to purchase.
To invest in any of Calvert's tax-deferred retirement plans, please call Calvert
Group at 800-368-2748 to receive information and the required separate
application.
Alternative Sales Options
The Fund offers two classes of shares:
Class A Shares - Front End Load Option
Class A shares are sold with a front-end sales charge at the time of
purchase. Class A shares are not subject to a sales charge when they are
redeemed.
Class C shares - Level Load Option
Class C shares are sold without a sales charge at the time of purchase or
redemption.
Class C shares have higher expenses
The Fund bears some of the costs of selling its shares under Distribution
Plans adopted with respect to its Class A and Class C shares pursuant to
Rule 12b-1 under the 1940 Act. Payments under the Class A Distribution Plan
are limited to 0.35% annually of the average daily net asset value of Class
A shares. The Class C Distribution Plan provides for the payment of an
annual distribution fee to CDI of up to 0.75%, plus a service fee of up to
0.25%, for a total of 1.00% of the average daily net assets attributable to
their respective classes.
Considerations for deciding which class of shares to buy
Income distributions for Class A shares will probably be higher than those for
Class C shares, as a result of the distribution expenses described above. (See
also "Yield and Total Return.") You should consider Class A shares if you
qualify for a reduced sales charge under Class A. Other factors affecting the
class decision include the amount of the purchase or if you plan to hold the
shares for several years.
Class A Shares
Class A shares are offered at net asset value plus a front-end sales charge as
follows:
Concession to
Dealers as a %
As a % of As a % of Net of Amount
Offering Price Amount Invested Invested
Amount of Investment
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Less than $50,000 4.75% 4.99% 4.00%
$50,000 but less than $100,000 3.75% 3.90% 3.00%
$100,000 but less than $250,000 2.75% 2.83% 2.25%
$250,000 but less than $500,000 1.75% 1.78% 1.25%
$500,000 but less than $1,000,000 1.00% 1.01% 0.80%
$1,000,000 and over 0.00% 0.00% 0.25%*
*For new investments (new purchases but not exchanges) of $1 million or more a
broker-dealer will have the choice of being paid a finder's fee by CDI in one of
the following methods: (1) CDI may pay broker-dealer, on a monthly basis for 12
months, an annual rate of 0.30%. Payments will be made monthly at the rate of
0.025% of the amount of the investment, less redemptions; or (2) CDI may pay
broker-dealers 0.25% of the amount of the purchase; however, CDI reserves the
right to recoup any portion of the amount paid to the dealer if the investor
redeems some or all of the shares from the Fund within thirteen months of the
time of purchase.
Sales charges on Class A shares may be reduced or eliminated in certain cases.
See Exhibit A to this prospectus.
The sales charge is paid to CDI, which in turn normally reallows a portion to
your broker-dealer. Upon written notice to dealers with whom it has dealer
agreements, CDI may reallow up to the full applicable sales charge. Dealers to
whom substantially the entire sales charge is reallowed may be deemed to be
underwriters under the Securities Act of 1933
In addition to any sales charge reallowance or finder's fee, your broker-dealer,
or other financial service firm through which your account is held, currently
will be paid periodic service fees at an annual rate of up to 0.25% of the
average daily net asset value of Class A shares held in accounts maintained by
that firm.
Class A Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class A shares (the
"Class A Distribution Plan"), which provides for payments at a maximum annual
rate of 0.35% of the average daily net asset value of Class A shares, to pay
expenses associated with the distribution and servicing of Class A shares.
Amounts paid by the Fund to CDI under the Class A Distribution Plan are used to
pay to dealers and others, including CDI salespersons who service accounts,
service fees at an annual rate of up to 0.25% of the average daily net asset
value of Class A shares, and to pay CDI for its marketing and distribution
expenses, including, but not limited to, preparation of advertising and sales
literature and the printing and mailing of prospectuses to prospective
investors. During the fiscal year ended September 30, 1994, the Fund paid Class
A Distribution Plan expenses of 0.25% of average net assets.
Each of the Distribution Plans may be terminated at any time by vote of the
Independent Directors or by vote of a majority of the outstanding voting shares
of the respective class.
Class C Shares
Class C shares are not available through all dealers. Class C shares are offered
at net asset value, without a front-end sales charge or a contingent deferred
sales charge. Class C expenses are higher than those of Class A.
Class C Distribution Plan
The Fund has adopted a Distribution Plan with respect to its Class C shares (the
"Class C Distribution Plan"), which provides for payments at an annual rate of
up to 1.00% of the average daily net asset value of Class C shares, to pay
expenses of the distribution and servicing of Class C shares. Amounts paid by
the Fund under the Class C Distribution Plan are currently used by CDI to pay
dealers and other selling firms dealer-paid quarterly compensation at an annual
rate of up to 0.75%, plus a service fee, as described above under "Class A
Distribution Plan," of up to 0.25%, of the average daily net asset value of each
share sold by such others. For the fiscal year ended September 30, 1994, the
Fund paid Class C Distribution Plan expenses of 1.00% of average net assets.
Arrangements with Broker-Dealers and Others
CDI may also pay additional concessions, including non-cash promotional
incentives, such as merchandise or trips, to dealers employing registered
representatives who have sold or are expected to sell a minimum dollar amount of
shares of the Fund and/or shares of other funds underwritten by CDI. CDI may
make expense reimbursements for special training of a dealer's registered
representatives, advertising or equipment, or to defray the expenses of sales
contests. Eligible marketing and distribution expenses may be paid pursuant to
the Fund's Rule 12b-1 Distribution Plan.
Dealers or others may receive different levels of compensation depending on
which class of shares they sell. Payments pursuant to a Distribution Plan are
included in the operating expenses of the class.
HOW TO BUY SHARES
(BE SURE TO SPECIFY WHICH CLASS YOU ARE BUYING)
Method Initial investment Additional Investments
By Mail $2,000 minimum $250 minimum
Please make your check Please make your check
payable to the Fund and payable to the Fund and
mail it with your mail it with your
application to: investment slip to:
Calvert Group Calvert Group
P.O. Box 419544 P.O. Box 419739
Kansas City, MO 64179-6739 Kansas City, MO 64179-6542
By Registered, Certified, or Overnight Mail: Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Through
Your Broker $2,000 minimum $250 minimum
At the Calvert Visit the Calvert Branch Office to make investments by
Branch Office check. See the back cover page for the address.
FOR ALL OPTIONS BELOW, PLEASE CALL YOUR BROKER OR CALVERT GROUP AT 800-368-2745
By Exchange $2,000 minimum $250 minimum
(From your account in another Calvert Group fund)
When opening an account by exchange, your new account must be established with
the same name(s), address and taxpayer identification number as your existing
Calvert account.
By Bank
Wire $2,000 minimum $250 minimum
By Calvert
Money Not Available $50 minimum
Controller* for Initial Investment
*Please allow sufficient time for Calvert Group to process your initial request
for this service, normally 10 business days. The maximum transaction amount is
$300,000, and your purchase request must be received by 4:00 p.m. Eastern time.
NET ASSET VALUE
Net asset value, or "NAV," refers to the worth of one share. NAV is computed by
adding the value of all portfolio holdings, plus other assets, deducting
liabilities and then dividing the result by the number of shares outstanding.
The NAV of each class will vary daily based on the market values of its
investments. This value is calculated at the close of the Fund's business day,
which coincides with the closing of the regular session of the New York Stock
Exchange (normally 4:00 p.m. Eastern time). The Fund is open for business each
day the New York Stock Exchange is open. All purchases of Fund shares will be
confirmed and credited to your account in full and fractional shares (rounded to
the nearest 1/1000th of a share).
Fund securities and other assets are valued based on market quotations, except
that securities maturing within 60 days are valued at amortized cost. If
quotations are not available, securities are valued by a method that the Board
of Directors believes accurately reflects fair value. Securities which are
primarily traded on foreign securities exchanges are generally valued at the
preceding closing values of such securities on their respective exchanges (See
the Statement of Additional Information -- "Determination of Net Asset Value")
relating to the valuation of foreign securities. Financial futures are valued at
the settlement price established each day by the board of trade or exchange on
which they are traded. All assets and liabilities initially expressed in foreign
currency values will be converted into United States dollars as last quoted by
any recognized dealer.
WHEN YOUR ACCOUNT WILL BE CREDITED
Before you buy shares, please read the following information to make sure your
investment is accepted and credited properly.
Your purchase will be processed at the next offering price based on the next net
asset value calculated after your order is received and accepted. If your
purchase is made by federal funds wire, or exchange, and is received by 4:00
p.m. (Eastern time), your account will be credited on the day of receipt. If
your purchase is received after 4:00 p.m. Eastern time, it will be credited the
next business day. All your purchases must be made in U.S. dollars and checks
must be drawn on U.S. banks. No cash will be accepted. The Fund reserves the
right to suspend the offering of shares for a period of time or to reject any
specific purchase order. If your check does not clear, your purchase will be
cancelled and you will be charged a $10 fee plus costs incurred by the Fund.
When you purchase by check or with Calvert Money Controller, the Fund can hold
payment on redemptions until it is reasonably satisfied that the investment is
collected (normally 10 business days from purchase date). To avoid this
collection period, you can wire federal funds from your bank, which may charge
you a fee.
Certain financial institutions or broker-dealers which have entered into a sales
agreement with the Distributor may enter confirmed purchase orders on behalf of
customers by phone, with payment to follow within a number of days of the order
as specified by the program. If payment is not received in the time specified,
the financial institution could be held liable for resulting fees or losses.
EXCHANGES
You may exchange shares of the Fund for shares of the same class of other
Calvert Group Funds.
If your investment goals change, the Calvert Group Family of Funds has a variety
of investment alternatives that includes common stock funds, tax-exempt and
corporate bond funds, and money market funds. The exchange privilege is a
convenient way to buy shares in other Calvert Group Funds in order to respond to
changes in your goals or in market conditions. However, the Fund is intended as
a long-term investment and not for frequent short-term trades. Before you make
an exchange from a Fund, please note the following:
Call your broker or a Calvert representative for information and a prospectus
for any of Calvert's other Funds registered in your state. Read the prospectus
of the Fund into which you want to exchange for relevant information, including
class offerings. The exchange privilege is only available in states where shares
of the fund into which you want to exchange are registered for sale.
Shares of a particular class of the Fund may be exchanged onely for shares
of the same class of another Calvert Fund, except that any clas may be
exchanged for Class A shares of any money market fund.
Each exchange represents the sale of shares of one Fund and the purchase of
shares of another. Therefore, you could realize a taxable gain or loss on the
transaction.
Complete and sign an application for an account in that fund, taking care to
register your new account in the same name and taxpayer identification number as
your existing Calvert account(s). Exchange instructions may then be given by
telephone if you have not declined telephone transaction privileges and the
shares are not in certificate form. See "Selling Your Shares" and "How to Sell
Your Shares-- By Telephone, and--By Exchange to Another Calvert Group Fund."
Shares on which you have already paid a sales charge at Calvert Group and shares
acquired by reinvestment of dividends or distributions may be exchanged into
another fund at no additional charge.
Shareholders (and those managing multiple accounts) who make two purchases and
two exchange redemptions of shares of the same fund during any 6-month period
will be given written notice that they may be prohibited from making additional
investments. This policy does not prohibit a shareholder from redeeming shares
of the Fund, and does not apply to trades solely among money market funds.
The Fund reserves the right to terminate or modify the exchange privilege in the
future upon 60 days' written notice.
OTHER CALVERT GROUP SERVICES
Calvert Information Network
24 hour yield and prices
Calvert Group has a round-the-clock telephone service that lets existing
customers use a push button phone with tone capabilities to obtain prices,
performance information, and account balances. Complete instructions for this
service may be found on the back of each statement.
Calvert Money Controller
Calvert Money Controller eliminates the delay of mailing a check or the expense
of wiring funds. You can request this free service on your application.
This service allows you to authorize electronic transfers of money to purchase
or sell shares. You use Calvert Money Controller like an "electronic check" to
move money ($50 to $300,000) between your bank account and your account in the
Fund with one phone call. Allow one or two business days after the call for the
transfer to take place; for money recently invested, allow normal check clearing
time (up to 10 business days) before redemption proceeds are sent to your bank.
All Calvert Money Controller transaction requests must be received by 4:00 p.m.
Eastern time.
You may also arrange systematic monthly or quarterly investments (minimum $50)
into your Calvert Group account. After you give us proper authorization, your
bank account will be debited to purchase Fund shares. You will receive a
confirmation from us for these transactions, and a debit entry will appear on
your bank statement. Share purchases made through Calvert Money Controller will
be subject to the applicable sales charge. If you would like to make
arrangements for systematic monthly or quarterly redemptions from your Calvert
account, call us for a Money Controller Application.
Telephone Transactions
Calvert may record all telephone calls.
If you have telephone transaction privileges, you may purchase, redeem, or
exchange shares, wire funds and use Calvert Money Controller by telephone. You
automatically have telephone privileges unless you elect otherwise. The Fund,
the transfer agent and their affiliates are not liable for acting in good faith
on telephone instructions relating to your account, so long as they follow
reasonable procedures to determine that the telephone instructions are genuine.
Such procedures may include recording the telephone calls and requiring some
form of personal identification. You should verify the accuracy of telephone
transactions immediately upon receipt of your confirmation statement.
Optional Services
Complete the "Option" sections of the application for the easiest way to
establish services.
The easiest way to establish optional services on your Calvert Group account is
to select the options you desire when you complete your account application. If
you wish to add other options later, you may have to provide us with additional
information and a signature guarantee. Please call your broker or Calvert
Investor Relations at 800-368-2745 for further assistance. For our mutual
protection, we may require a signature guarantee on certain written transaction
requests. A signature guarantee verifies the authenticity of your signature, and
may be obtained from any bank, savings and loan association, credit union, trust
company, broker-dealer firm or member of a domestic stock exchange. A signature
guarantee cannot be provided by a notary public.
Householding of General Mailings
You can help in an effort to reduce Fund expenses and save paper and trees
for the environment.
If you have multiple accounts with Calvert, you may receive combined mailings of
some shareholder information, such as semi-annual and annual reports. Please
contact Calvert Investor Relations at 800-368-2745 to receive additional copies
of information.
Special Services and Charges
The Fund pays for shareholder services but not for special services that are
required by a few shareholders, such as a request for a historical transcript of
an account. You may be required to pay a research fee for these special
services.
If you are purchasing shares of the Fund through a program of services offered
by a broker-dealer or financial institution, you should read the program
materials in conjunction with this Prospectus. Certain features of the Fund may
be modified in these programs, and administrative charges may be imposed for the
services rendered.
Tax-Saving Retirement Plans
Contact Calvert Group for complete information kits discussing the plans, and
their benefits, provisions and fees.
Calvert Group can set up your new account in the Fund under one of several
tax-deferred plans. These plans let you invest for retirement and shelter your
investment income from current taxes. Minimums may differ from those listed in
the chart on page __. Also, reduced sales charges may apply. See "Exhibit A -
Reduced Sales Charges."
Individual retirement accounts (IRAs): available to anyone who has earned
income. You may also be able to make investments in the name of your spouse, if
your spouse has no earned income.
Qualified Profit-Sharing and Money-Purchase Plans (including 401(k) Plans):
available to self-employed people and their partners, or to corporations and
their employees.
Simplified Employee Pension Plan (SEP-IRA): available to self-employed people
and their partners, or to corporations. Salary reduction pension plans (SAR-SEP
IRAs) are also available to employers with 25 or fewer employees.
403(b)(7) Custodial Accounts: available to employees of most non-profit
organizations and public schools and universities.
HOW TO SELL YOUR SHARES
You may redeem all or a portion of your shares on any business day. Your shares
will be redeemed at the next net asset value calculated after your redemption
request is received and accepted. See below for specific requirements necessary
to make sure your redemption request is accepted. Remember that the Fund may
hold payment on the redemption of your shares until it is reasonably satisfied
that investments made by check or by Calvert Money Controller have been
collected (normally up to 10 business days).
Redemption Requirements To Remember
To ensure acceptance of your redemption request, please follow the procedures
described here and below.
Once your shares are redeemed, the proceeds will normally be sent to you on the
next business day, but if making immediate payment could adversely affect the
Fund, it may take up to seven (7) days. Calvert Money Controller redemptions
generally will be credited to your bank account on the first or second business
day after your phone call. 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
Securities and Exchange Commission, redemptions may be suspended or payment
dates postponed.
Minimum account balance is $1,000 per Fund.
Please maintain a balance in your account of at least $1,000, per Fund, per
class. If, due to redemptions, it falls below $1,000, your account may be closed
and the proceeds mailed to you at the address of record. You will be given
notice that your account will be closed after 30 days unless you make an
additional investment to increase your account balance to the $1,000 minimum.
By Mail To:
Calvert Group
P.O. Box 419544
Kansas City, MO
64179-6542
You may redeem available funds from your account at any time by sending a letter
of instruction, including your name, account and Fund number, the number of
shares or dollar amount, and where you want the money to be sent. Additional
requirements, below, may apply to your account. The letter of instruction must
be signed by all required authorized signers. If you want the money to be wired
to a bank not previously authorized, then a voided bank check must be enclosed
with your letter. If you do not have a voided check or if you would like funds
sent to a different address or another person, your letter must be signature
guaranteed.
Type of Registration Requirements
Corporations, Associations Letter of instruction and corporate
resolution, signed by person(s) authorized
to act on the account, accompanied by
signature guarantee(s).
Trusts Letter of instruction signed by the
Trustee(s) (as Trustees), with a signature
guarantee. (If the Trustee's name is not
registered on your account, provide a copy
of the trust document, certified within
the last 60 days.)
By Telephone
Please call 800-368-2745. You may redeem shares from your account by telephone
and have your money mailed to your address of record or wired to an address or
bank you have previously authorized. A charge of $5 is imposed on wire transfers
of less than $1,000. See "Telephone Transactions" on page ___. If for any reason
you are unable to reach the Fund by telephone, whether due to mechanical
difficulties, heavy market volume, or otherwise, you may send a written
redemption request to the Fund by overnight mail, or, if your account is held
through a broker, see "Through Your Broker" below.
Calvert Money Controller
Please allow sufficient time for Calvert Group to process your initial request
for this service (normally 10 business days). Your request for a redemption by
this service must be received by 4:00 p.m. Eastern time. Accounts cannot be
closed by this service.
Exchange to Another Calvert Group Fund
You must meet the minimum investment requirement of the other Calvert Group
Fund. You can only exchange between accounts with identical names, addresses and
taxpayer identification number, unless previously authorized with a
signature-guaranteed letter. See "Exchanges."
Systematic Check Redemptions
If you have an account with a balance of $10,000 or more, you may have regular
monthly or quarterly redemption checks for $100 or more sent to you or another
recipient on the 15th of each month. This service must be authorized in advance,
with a signature-guaranteed letter.
Through your Broker
If your account is held in your broker's name ("street name"), you should
contact your broker directly to transfer, exchange or redeem shares.
DIVIDENDS AND TAXES
Each year, the Fund distributes substantially all of its net investment income
and capital gains to shareholders.
Dividends from the Fund's net investment income are declared and paid annually.
Net investment income consists of the interest income, net short-term capital
gains, if any, and dividends declared and paid on investments, less expenses.
Distributions of net long-term capital gains, if any, are normally declared and
paid by the Fund once a year; however, the Fund does not anticipate making any
such distributions unless available capital loss carryovers have been used or
have expired. Dividend and distribution payments will vary between classes;
dividend payments are anticipated to be generally higher for Class A shares.
Dividend Payment Options
Dividends and distributions are automatically reinvested in additional shares,
unless on the account application you request to have them paid to you in cash
(by check or by Calvert Money Controller). You may also request to have your
dividends and distributions from the Fund invested at net asset value ("NAV") in
shares of any other Calvert Group Fund. If you choose to have them reinvested in
the same Fund, the new shares will be purchased at the NAV (no sales charge) on
the reinvest date, which is generally 1 to 3 days prior to the payment date. You
must notify the Fund in writing prior to the record date if you want to change
your payment options. If you elect to have dividends and/or distributions paid
in cash, and the U.S. Postal Service cannot deliver the check, or if it remains
uncashed for six months, it, as well as future dividends and distributions, will
be reinvested in additional shares.
"Buying a Dividend"
At the time of purchase, the share price of the Fund may reflect undistributed
income, capital gains or unrealized appreciation of securities. Any income or
capital gains from these amounts which are later distributed to you are fully
taxable as dividends or capital gains distributions. On the record date for a
distribution, the Fund's per share value is reduced by the amount of the
distribution. If you buy shares just before the record date ("buying a
dividend") you will pay the full price for the shares and then receive a portion
of the price back as a taxable distribution.
Federal Taxes
The Fund normally distributes all net income and capital gain to shareholders.
These distributions are taxable to you regardless of whether they are taken in
cash or reinvested. Distributions of dividends and net realized short-term
capital gains are taxable as ordinary income; capital gains distributions are
taxable as long-term capital gains regardless of how long you have held the
shares. Dividends and distributions declared in December and paid in January are
taxable in the year they are declared. The Fund will mail you Form 1099-DIV in
January indicating the federal tax status of your dividends.
Distributions resulting from the sale of certain foreign currencies and debt
securities are taxed as ordinary income gain or loss. If these transactions
result in reducing the Fund's net income, a portion of the dividends may be
classified as a return of capital (which lowers your tax base). If the Fund pays
taxes to foreign governments during the year, the taxes will reduce the Fund's
dividends but will still be included in your taxable income. However, you may be
able to claim an offsetting credit or deduction on your tax return for your
portion of foreign taxes paid by the Fund.
You may realize a capital gain or loss when you sell or exchange shares
If you sell or exchange your Fund shares you will have a short or long-term
capital gain or loss, depending on how long you owned the shares which were
sold. In January, the Fund will mail you Form 1099-B indicating the proceeds
from all sales, including exchanges. You should keep your annual year-end
account statements to determine the cost (basis) of the shares to report on your
tax returns.
Taxpayer Identification Number, Back-up Withholding
If we do not have your correct Social Security or Corporate Tax Identification
Number ("TIN") and a signed certified application or Form W-9, federal law
requires the Fund to withhold 31% of your dividends, capital gain distributions,
and redemptions. In addition, you may be subject to a fine. You will also be
prohibited from opening another account by exchange. If this TIN information is
not received within 60 days after your account is established, your account may
be redeemed at the current NAV on the date of redemption. The Fund reserves the
right to reject any new account or any purchase order for failure to supply a
certified TIN.
EXHIBIT A
REDUCED SALES CHARGES (CLASS A ONLY)
You may qualify for a reduced sales charge through several purchase plans
available. You must notify the Fund at the time of purchase to take advantage of
the reduced sales charge.
Right of Accumulation. The sales charge is calculated by taking into account not
only the dollar amount of a new purchase of shares, but also the higher of cost
or current value of shares previously purchased in Calvert Group Funds that
impose sales charges. This automatically applies to your account for each new
purchase.
Letter of Intent. If you plan to purchase $50,000 or more of Fund shares over
the next 13 months, your sales charge may be reduced through a "Letter of
Intent." You pay the lower sales charge applicable to the total amount you plan
to invest over the 13-month period, excluding any money market fund purchases.
Part of your shares will be held in escrow, so that if you do not invest the
amount indicated, you will have to pay the sales charge applicable to the
smaller investment actually made. For more information, see the Statement of
Additional Information.
Group Purchases. If you are a member of a qualified group, you may purchase
shares of the Fund at the reduced sales charge applicable to the group taken as
a whole. The sales charge is calculated by taking into account not only the
dollar amount of the shares you purchase, but also the higher of cost or current
value of shares previously purchased and currently held by other members of your
group.
A "qualified group" is one which (i) has been in existence for more than six
months, (ii) has a purpose other than acquiring Fund shares at a discount, and
(iii) satisfies uniform criteria which enable CDI and dealers offering Fund
shares to realize economies of scale in distributing such shares. A qualified
group must have more than 10 members, must be available to arrange for group
meetings between representatives of CDI or dealers distributing the Fund's
shares, must agree to include sales and other materials related to the Fund in
its publications and mailings to members at reduced or no cost to CDI or
dealers, and must seek to arrange for payroll deduction or other bulk
transmission of investments to the Fund.
Pension plans may not qualify participants for group purchases; however, such
plans may qualify for reduced sales charges under a separate provision (see
below). Members of a group are not eligible for a Letter of Intent.
Retirement Plans Under Section 457, Section 403(b)(7), or Section 401(k). There
is no sales charge on shares purchased for the benefit of a retirement plan
under Section 457 of the Internal Revenue Code of 1986, as amended ("Code"), or
for a plan qualifying under Section 403(b)(7) of the Code if, at the time of
purchase, Calvert Group has been notified in writing that the 403(b)(7) plan has
at least 200 eligible employees. Furthermore, there is no sales charge on shares
purchased for the benefit of a retirement plan qualifying under Section 401(k)
of the Code if, at the time of such purchase, the 401(k) plan administrator has
notified Calvert Group in writing that a) its 401(k) plan has at least 200
eligible employees; or b) the cost or current value of shares the plan has in
Calvert Group of Funds (except money market funds) is at least $1 million.
Neither the Fund, nor CDI, nor any affiliate thereof will reimburse a plan or
participant for any sales charges paid prior to receipt of such written
communication and confirmation by Calvert Group. Plan administrators should send
requests for the waiver of sales charges based on the above conditions to:
Calvert Group Retirement Plans, 4550 Montgomery Avenue, Suite 1000N, Bethesda,
Maryland 20814.
Other Circumstances. There is no sales charge on shares of any fund (portfolio
or series) of the Calvert Group of Funds sold to:
(i) current and retired members of the Board of Trustees/Directors of the
Calvert Group of Funds, (and the Advisory Council of the Calvert Social
Fund);
(ii) directors, officers and employees of the Advisor, Distributor, and
their affiliated companies;
(iii) directors, officers and registered representatives of brokers
distributing the Fund's shares; and immediate family members of persons
listed in (i), (ii), and (iii) above;
(iv) dealers, brokers, or registered investment advisors that have entered
into an agreement with CDI providing specifically for the use of shares of
the Fund (Portfolio or Series) in particular investment programs or
products (where such program or product already has a fee charged therein)
made available to the clients of such dealer, broker, or registered
investment advisor; and
(v) trust departments of banks or savings institutions for trust clients of
such bank or savings institution.
Dividends and Capital Gain Distributions from other Calvert Group Funds.
You may prearrange to have your dividends and capital gain distributions
from another Calvert Group Fund with a sales charge automatically invested in
another account with no additional sales charge. Dividends and distributions
from Calvert Group money market funds used to purchase shares of the Fund
will be subject to the applicable sales charge.
Reinstatement Privilege. If you redeem Fund shares and then within 30 days
decide to reinvest in the same Fund, you may do so at the net asset value
next computed after the reinvestment order is received, without a sales
charge. You may use the reinstatement privilege only once. The Fund
reserves the right to modify or eliminate this privilege.
================================================================================
To Open an Account:
800-368-2748 Prospectus
January 31, 1995
CALVERT WORLD
VALUES FUND, INC.
Global Equity Fund
Performance and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
Service for Existing Account:
Shareholders 800-368-2745
Brokers 800-368-2746
TDD for Hearing Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
PRINCIPAL UNDERWRITER
Calvert Securities Corporation
(after 2/28/95, Calvert Distributors, Inc.)
a subsidiary of Calvert Group
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Table of Contents
Fund Expenses
Financial Highlights
Investment Objective and Policies
Risk Factors
Investment Techniques and Related Risks
Social Screens
Total Return
Management of the Fund
SHAREHOLDER GUIDE:
Alternative Sales Options
How to Buy Shares
Net Asset Value
When Your Account Will Be Credited
Exchanges
Other Calvert Group Services
How to Sell Your Shares
Dividends and Taxes
Exhibit A - Reduced Sales Charges
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