BT PYRAMID MUTUAL FUNDS, 485BPOS, 2000-01-31

BT PYRAMID MUTUAL FUNDS
485BPOS, 2000-01-31

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<PAGE>

As filed with the Commission on January 31, 2000

1933 Act File No. 33-45973
1940 Act File No. 811-6576

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X

Post-Effective Amendment No. 31................... X

and

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X

Amendment No. 32.................................. X

BT PYRAMID MUTUAL FUNDS
(Exact Name of Registrant as Specified in Charter)

One South Street, Baltimore, Maryland 21202
(Address of Principal Executive Offices)

(410) 895-3433
(Registrant's Telephone Number)

Daniel O. Hirsch, Esq. Copies to: Burton M. Leibert, Esq.
One South Street Willkie Farr & Gallagher
Baltimore, Maryland 21202 787 Seventh Ave
(Name and Address of Agent New York, New York 10019
for Service)

It is proposed that this filing will become effective (check appropriate box):

[ ] Immediately upon filing pursuant to paragraph (b)
[x] On January 31, 2000, pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] On January 31, 2000, pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] On (date) pursuant to paragraph (a)(2) of rule 485.

If appropriate, check the following box:

[ ] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

BT Investment Portfolios, on behalf of PreservationPlus Portfolio, has also
executed this Registration Statement.
<PAGE>

Deutsche Asset Management

- --------------------------------------------------------------------------------
Mutual Fund

Prospectus

January 31, 2000

Institutional Class
- --------------------------------------------------------------------------------

Equity Appreciation
formerly BT Investment Equity Appreciation Fund

[Like shares of all mutual funds, these securities have not been approved or
disapproved by the Securities and Exchange Commission nor has the Securities and
Exchange Commission passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.]

A Member of the
Deutsche Bank Group [LOGO]

<PAGE>

Overview
- --------------------------------------------------------------------------------
of Equity Appreciation--Institutional Class

Goal: The Fund invests for long-term capital growth.
Core Strategy: The Fund invests primarily in the stocks and other equity
securities of medium-sized U.S. companies with strong growth potential.

INVESTMENT POLICIES AND STRATEGIES
The Fund seeks to achieve its goal by investing in stocks and other equity
securities of medium-sized companies with strong growth prospects. Companies
are selected based on factors such as the company's business prospects, its
record of earnings growth and its stock price relative to industry peers.
- --------------------------------------------------------------------------------

Equity Appreciation--Institutional Class

Overview of Equity Appreciation--Institutional Class

<TABLE>
<S> <C>
Goal........................................................................ 3
Core Strategy............................................................... 3
Investment Policies and Strategies.......................................... 3
Principal Risks of Investing in the Fund.................................... 4
Who Should Consider Investing in the Fund................................... 4
Total Returns, After Fees and Expenses...................................... 5
Annual Fund Operating Expenses.............................................. 6
</TABLE>

A Detailed Look at Equity Appreciation--Institutional Class

<TABLE>
<S> <C>
Objective.................................................................. 7
Strategy................................................................... 7
Principal Investments...................................................... 7
Investment Process......................................................... 7
Risks...................................................................... 8
Management of the Fund..................................................... 8
</TABLE>
<TABLE>
<S> <C>
Calculating the Fund's Share Price.......................................... 10
Performance Information..................................................... 10
Dividends and Distributions................................................. 10
Tax Considerations.......................................................... 10
Buying and Selling Fund Shares.............................................. 11
Financial Highlights........................................................ 13
</TABLE>
- --------------------------------------------------------------------------------

3
<PAGE>

Overview of Equity Appreciation--Institutional Class

PRINCIPAL RISKS OF INVESTING IN THE FUND

An investment in the Fund could lose money, or the Fund's performance could
trail that of other investments. For example:

. Stocks that we have selected could perform poorly;
. Medium-sized company stock returns could trail stock market returns generally
because of risks specific to medium-sized company investing, i.e., greater
share-price volatility and fewer buyers for medium-sized company shares in
periods of economic or stock market stress. Such risks may hurt the prices of
the stocks in the Fund's portfolio and limit the ability to exit from an
unsuccessful investment; or
. The stock market could decline or could underperform other investments.
WHO SHOULD CONSIDER INVESTING
IN THE FUND

Equity Appreciation-Institutional Class requires a minimum investment of
$250,000. You should consider investing in the Fund if you are seeking long-
term capital growth. There is, of course, no guarantee that the Fund will
realize its goal. Moreover, you should be willing to accept greater short-term
fluctuations in the value of your investment than you would typically
experience investing in bond or money market funds.

You should not consider investing in the Fund if you are pursuing a short-term
financial goal, if you seek regular income or if you cannot tolerate
fluctuations in the value of your investments.

The Fund by itself does not constitute a balanced investment program. It can,
however, afford you exposure to investment opportunities not available to an
investor in large company stocks and small company stocks.

On September 8, 1999, the Board of Trustees voted to recommend the
reorganization of the Fund into Mid Cap fund (formerly Capital Appreciation
Fund). The Board has determined that this proposal is in the best interests of
shareholders. The Fund and Mid Cap currently have the same investment
management teams and employ the same investment strategy.

The merger requires the approval of the Fund's shareholders. A special meeting
of shareholders will be held for this purpose. A proxy statement describing the
proposed reorganization will be sent to Fund shareholders before the special
meeting. Management currently anticipates that the shareholder meeting will
take place in the second quarter of 2000.

If shareholders approve the merger, shares of the Fund will be converted to
shares of Mid Cap. Mid Cap has a master-feeder structure, which differs from
the stand-alone structure of the Fund. A full description of Mid Cap's master-
feeder structure will be included in the proxy statement mailed to
shareholders. It is intended that the transfer of shares from the Fund to Mid
Cap will not be a taxable transaction for shareholders and that the fees of the
Fund will remain the same.

An investment in Equity Appreciation is not a bank deposit and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
- --------------------------------------------------------------------------------

4
<PAGE>

Overview of Equity Appreciation--Institutional Class

TOTAL RETURNS, AFTER FEES AND EXPENSES

The bar chart and table on this page can help you evaluate the potential risks
and rewards of investing in the Fund by showing changes in the Fund's
performance year to year. The bar chart shows the Fund's actual return for each
full calendar year since the Fund began selling shares on October 12, 1993 (its
inception date). The table compares the Fund's average annual return with the
Standard & Poor's (S&P) Mid-Cap 400 Index over the last one and five years, and
since inception. The Index is a passive measure of market returns. It does not
factor in the costs of buying, selling and holding stock--costs that are
reflected in the Fund's results.

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

The S&P Mid-Cap 400 Index is a widely accepted benchmark of medium-sized
company stock performance. The Index is a model, not an actual portfolio, that
tracks the performance of 400 publicly held medium-sized U.S. companies.
Year-by-Year Returns
(each full calendar year since inception)

[BAR CHART]

1994 1995 1996 1997 1998 1999
----- ------ ----- ----- ----- -----
3.47% 37.62% 9.60% 15.40% 17.79% 49.70

Since inception, the Fund's highest return in any calendar quarter was 31.08%
(fourth quarter 1999) and its lowest quarterly return was -19.33% (third
quarter 1998). Past performance offers no indication of how the Fund will
perform in the future.

PERFORMANCE FOR PERIOD ENDED 12/31/99

<TABLE>
<CAPTION>
Average Annual Returns
1 Year 5 Years Since
Inception
(10/12/93)/1/
<S> <C> <C> <C>
Equity
Appreciation -
Institutional
Class 49.70% 25.14% 20.03%
-----------------------------------------------
S&P Mid-Cap 400
Index 14.72% 23.05% 18.04%
-----------------------------------------------
</TABLE>

/1/ The S&P Mid-Cap 400 Index is cal-
culated from September 30, 1993.
- --------------------------------------------------------------------------------

5
<PAGE>

Overview of Equity Appreciation--Institutional Class

ANNUAL FUND OPERATING EXPENSES
(expenses paid from Fund assets)

The Annual Fees and Expenses table to the right describes the fees and expenses
that you may pay if you buy and hold shares of the Equity Appreciation--
Institutional Class.

Expense Example. The example below illustrates the expenses you would have
incurred on a $10,000 investment in the Fund. It assumes that the Fund earned
an annual return of 5% over the periods shown, that the Fund's operating
expenses remained the same over the periods shown and that you sold your shares
at the end of the period.

You may use this hypothetical example to compare the Fund's expense history
with other funds. Your actual costs may be higher or lower.
- --------------------------------------------------------------------------------

/1/The investment adviser and administrator have agreed, for the 16-month
period from the Fund's fiscal year end of September 30, 1999, to waive their
fees or reimburse expenses so that total expenses will not exceed 1.00%.

/2/For the first 16 months, the expense example takes into account fee waivers
and reimbursements.
ANNUAL FEES AND EXPENSES

<TABLE>
<CAPTION>
Percentage of Average
Daily Net Assets/1/
<S> <C>
Management Fees 0.65%
--------------------------------------------------
Distribution and
Service (12b-1) Fees none
--------------------------------------------------
Other Expenses 0.55%
--------------------------------------------------
Total Fund Operating
Expenses 1.20%
--------------------------------------------------
Less: Fee Waivers or
Expense
Reimbursements (0.20)%/2/
--------------------------------------------------
Net Expenses 1.00%
--------------------------------------------------
</TABLE>

Expense Example/2/

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C>
$102 $354 $634 $1,431
-------------------------------------
</TABLE>

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

6
<PAGE>

A detailed look
- --------------------------------------------------------------------------------
at Equity Appreciation--Institutional Class

OBJECTIVE

Equity Appreciation--Institutional Class seeks long-term capital growth. Under
normal circumstances, the Fund invests the majority of its assets in the stock
and other securities with equity characteristics of U.S. companies with market
capitalizations, at the time we first purchase the shares, within the market
capitalization range of the S&P Mid-Cap 400 Index. We believe these companies
contain the greatest concentration of businesses with significant growth
prospects.

The Fund invests for capital growth, not income; any dividend or interest
income is incidental to the pursuit of its goal. While we give priority to
capital growth, we cannot offer any assurance of achieving this goal. The
Fund's goal is not a fundamental policy. We must notify shareholders before we
change it, but we do not require their approval to do so.

STRATEGY

We pursue a flexible investment program to achieve the Fund's objective. We are
not restricted to investments in specific market sectors. We may invest in any
market sector and in any size company if we have identified an opportunity with
attractive long-term prospects for capital growth. Nevertheless, we attempt to
match the dollar-weighted average capitalization of the Fund's holdings to the
midpoint capitalization of the S&P Mid-Cap 400 Index.

We consider many broad factors in assessing a potential candidate for
investment, including generally:

. competitive position within its industry;

. business prospects;

. management team;

. record of earnings growth;

. underlying asset value relative to industry peers;

. stock price relative to industry peers; and

. whether a reliable and liquid market for its shares exists.

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

"Market capitalization," or "market cap," provides an estimate of a company's
value. It is calculated by multiplying the total number of a company's
outstanding shares by the share's current price.

PRINCIPAL INVESTMENTS

The Fund normally owns stock in approximately 100 medium-sized companies at any
one time. The Fund focuses primarily in stock and other securities with equity
characteristics. The Fund focuses principally on companies with market caps, at
the time we purchase the stock, within the market capitalization range of the
S&P Mid-Cap 400 Index. It may also invest in convertible securities when it is
more advantageous than investing in a company's common stock.

The Fund may also invest up to 25% of its assets in stocks and other securities
of companies based outside the United States. Under normal conditions, this
tactic would not comprise a major element of its strategy.

INVESTMENT PROCESS

The Fund's process begins with a methodical search for companies (in any
industry) that show attractive long-term prospects for growth. The research
team relies on information gleaned from a variety of sources and perspectives,
including broad trends such as lifestyle and technological changes, industry
cycles and regulatory changes, quantitative screening and individual company
analysis. Companies are screened to identify those with strong business
fundamentals (i.e., high growth, low debt, high return-on-equity) and technical
strength. Measures of this strength include the extent of management's
ownership of a company's shares, the extent of ownership by mutual funds and
other large professional investors, estimates of future earnings by investment
analysts who follow the stock and the extent that actual earnings have deviated
from analysts' estimates in the recent past. The list of candidates is narrowed
down through meetings with company and industry contacts, attendance at
conferences focusing on emerging growth companies, and reviews of research and
industry publications and investment analyst contacts.

Temporary Defensive Position. We may, from time to time, adopt a temporary
defensive position in response to extraordinary adverse political, economic or
stock market events. We may invest up to 100% of the Fund's assets in the

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

Convertible securities are bonds or preferred stock that give purchasers the
right of exchange for a specified number of shares of a company's common stock
at specified prices within a certain period of time. Purchasers receive regular
interest payments until they exercise their exchange right.
- --------------------------------------------------------------------------------

7
<PAGE>

A Detailed Look at Equity Appreciation--Institutional Class

common stock of larger companies, in fixed-income securities, or short-term
money market securities. To the extent we adopt such a position and over the
course of its duration, the Fund may not meet its goal of long-term capital
growth.

RISKS

Below we set forth some of the prominent risks associated with investing in
medium-sized companies, as well as investing in general. Although we attempt to
assess the likelihood that these risks may actually occur and to limit them, we
make no guarantee that we will succeed.

Primary Risks

Market Risk. Although individual stocks can outperform their local markets,
deteriorating market conditions might cause an overall weakness in the stock
prices of the entire market.

Stock Selection Risk. A risk that pervades all investing is the risk that the
securities an investor has selected will not perform to expectations. The Fund
follows a disciplined selling process to try to lessen this risk. First, we may
sell a security if one or more of the following conditions take place:

. There is a material change in the company's fundamentals;

. The stock underperforms its industry peer group by 15% or more; or

. The stock price reaches our expectations.

Medium-Sized Company Risk. Medium-sized company stocks tend to experience
steeper price fluctuations--down as well as up--than the stocks of larger
companies. A shortage of reliable information--the same information gap that
creates opportunity--can pose added risk. Industrywide reversals have had a
greater impact on medium-sized companies, since they usually lack a large
company's financial resources. Medium-sized company stocks are typically less
liquid than large company stocks: when things are going poorly for a medium-
sized company, it is harder to find a buyer for a medium-sized companies'
shares.

Foreign Investment Risk. To the extent that the Fund holds companies based
outside the United States, it faces the risks inherent in foreign investing.
Adverse political, economic or social developments could undermine the value of
the Fund's investments or prevent the Fund from realizing their full value.
Financial reporting standards for companies based in foreign

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

Portfolio Turnover. The portfolio turnover rate measures the frequency that the
master portfolio sells and replaces the securities it holds within a given
period. Historically, this Fund has had a high portfolio turnover rate. High
turnover can increase the Fund's transaction costs, thereby lowering its
returns. It may also increase your tax liability.
markets differ from those in the United States. Since the "numbers" themselves
sometimes mean different things, we devote much of our research effort to
understanding and assessing the impact of these differences upon a company's
financial condition. Finally, the currency of the country in which the Fund has
invested could decline relative to the value of the U.S. dollar, which would
depreciate the value of an investment itself to U.S. investors.

Secondary Risk

Pricing Risk. When price quotations for securities are not readily available,
we determine their value by the method that most accurately reflects their
current worth in the judgment of the Board of Trustees. This procedure implies
an unavoidable risk, the risk that our prices are higher or lower than the
prices that the securities might actually command if we sold them. If we have
valued the securities too highly, you may end up paying too much for Fund
shares when you buy. If we underestimate their price, you may not receive the
full market value for your Fund shares when you sell.

MANAGEMENT OF THE FUND

Deutsche Asset Management is the marketing name for the asset management
activities of Deutsche Bank A.G., Deutsche Funds Management, Bankers Trust
Company, DB Alex. Brown LLC, Deutsche Asset Management, Inc., and Deutsche
Asset Management Investment Services Limited.

Board of Trustees. The Fund's shareholders, voting in proportion to the number
of shares each owns, elect a Board of Trustees, and the Trustees supervise all
of the Fund's activities on their behalf.

Investment Adviser. Under the supervision of the Board of Trustees, Bankers
Trust Company, with headquarters at 130 Liberty Street, New York, NY 10006,
acts as the Fund's investment adviser. Bankers Trust is an indirect wholly-
owned subsidiary of Deutsche Bank A.G. As investment adviser, Bankers Trust
makes the Fund's investment decisions. It buys and sells securities for the
Fund and conducts the research that leads to the purchase and sale decisions.
The investment adviser received a fee of 0.65% of the Fund's average daily net
assets for its services in the last fiscal year. The investment adviser
reimbursed a portion of its fee during the period.

As of September 30, 1999, Bankers Trust had total assets under management of
approximately $285 billion. Bankers Trust is dedicated to servicing the needs
of corporations, governments, financial institutions, and private clients and
has invested retirement assets on behalf of the nation's largest corporations
and institutions for more than 50 years. The scope of the firm's
- --------------------------------------------------------------------------------

8
<PAGE>

A Detailed Look at Equity Appreciation--Institutional Class

capability is broad: it is a leader in both the active and passive
quantitative investment disciplines and maintains a major presence in stock
and bond markets worldwide.

At a special meeting of shareholders held in 1999, shareholders of the Fund
approved a new investment advisory agreement with Deutsche Asset Management,
Inc. (formerly Morgan Grenfell Inc.). The new investment advisory agreement
with may be implemented within two years of the date of the special meeting
upon approval of a majority of the members of the Board of Trustees who are
not "interested persons," generally referred to as independent trustees.
Shareholders of the Fund also approved a new sub-investment advisory agreement
among the Trust, Deutsche Asset Management, Inc. and Bankers Trust under which
Bankers Trust may perform certain of Deutsche Asset Management, Inc.'s
responsibilities, at Deutsche Asset Management, Inc.'s expense, upon approval
of the independent trustees, within two years of the date of the special
meeting. Under the new investment advisory agreement and new sub-advisory
agreement, the compensation paid and the services provided would be the same
as those under the existing advisory agreement with Bankers Trust.

Deutsche Asset Management, Inc. is located at 885 Third Avenue, 32nd Floor,
New York, New York 10022. The firm provides a full range of investment
advisory services to institutional clients. It serves as investment adviser to
11 other investment companies and as sub-adviser to five other investment
companies.

On March 11, 1999, Bankers Trust announced that it had reached an agreement
with the United States Attorney's Office in the Southern District of New York
to resolve an investigation concerning inappropriate transfers of unclaimed
funds and related record-keeping problems that occurred between 1994 and early
1996. Bankers Trust pleaded guilty to misstating entries in the bank's books
and records and agreed to pay a $63.5 million fine to state and federal
authorities. On July 26, 1999, the federal criminal proceedings were concluded
with Bankers Trust's formal sentencing. The events leading up to the guilty
pleas did not arise out of the investment advisory or mutual fund management
activities of Bankers Trust or its affiliates.

As a result of the plea, absent an order from the SEC, Bankers Trust would not
be able to continue to provide investment advisory services to the Fund. The
SEC has granted a temporary order to permit Bankers Trust and its affiliates
to continue to provide investment advisory services to registered investment
companies. There is no assurance that the SEC will grant a permanent order.

Portfolio Manager. The following portfolio manager is responsible for the day-
to-day management of the Fund's investments:

Mary P. Dugan, CFA

. Portfolio Manager of the Fund since 1999.

. Portfolio Manager in the investment adviser's small cap group from 1994 to
1999.

. Securities Analyst at Fred Alger Management from 1992 to 1994 and at Dean
Witter Reynolds from 1989 to 1992.

. BA from the University of Rochester and MBA from New York University's Stern
School of Business.

Other Services. Bankers Trust provides administrative services-such as
portfolio accounting, legal services and others--for the Fund. In addition,
Bankers Trust--or your service agent--performs the functions necessary to
establish and maintain your account. In addition to setting up the account and
processing your purchase and sale orders, these functions include:

. keeping accurate, up-to-date records for your individual Fund account;

. implementing any changes you wish to make in your account information;

. processing your requests for cash dividends and distributions from the Fund;

. answering your questions on the Fund's investment performance or
administration;

. sending proxy reports and updated prospectus information to you; and

. collecting your executed proxies.

Service agents include brokers, financial advisors or any other bank, dealer
or other institution that has a sub-shareholder servicing agreement with
Bankers Trust. Service agents may charge additional fees to investors only for
those services not otherwise included in the Bankers Trust servicing
agreement, such as cash management, or special trust or retirement-investment
reporting.
- -------------------------------------------------------------------------------

9
<PAGE>

A Detailed Look at Equity Appreciation--Institutional Class

CALCULATING THE FUND'S SHARE PRICE

We calculate the daily price of the Fund's shares (also known as the "Net Asset
Value" or "NAV") in accordance with the standard formula for valuing mutual
fund shares at the close of regular trading on the New York Stock Exchange
every day the Exchange is open for business.

The formula calls for deducting all of the Fund's liabilities from the total
value of its assets--the market value of the securities it holds, plus its cash
reserves--and dividing the result by the number of shares outstanding. (Note
that prices for securities that trade on foreign exchanges can change
significantly on days when the New York Stock Exchange is closed and you cannot
buy or sell Funds. Such price changes in the securities the Fund owns may
ultimately affect the price of Fund shares the next time the NAV is
calculated.)

We value the securities in the Fund at their stated market value if price
quotations are available. When price quotes for a particular security are not
readily available, we determine their value by the method that most accurately
reflects their current worth in the judgment of the Board of Trustees. You can
find the Fund's daily share price in the mutual fund listings of most major
newspapers.

PERFORMANCE INFORMATION

The Fund's performance can be used in advertisements that appear in various
publications. It may be compared to the performance of various indexes and
investments for which reliable performance data is available. The Fund's
performance may also be compared to averages, performance rankings, or other
information prepared by recognized mutual fund statistical services.

DIVIDENDS AND DISTRIBUTIONS

Dividends and capital gains distributions, if any, are paid annually. We
automatically reinvest all dividends and any capital gains, unless you tell us
otherwise.

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

TAX CONSIDERATIONS

The Fund does not ordinarily pay income taxes. You and other shareholders pay
taxes on the income or capital gains from the Fund's holdings. Your taxes will
vary from year to year, based on the amount of capital gains distributions and
dividends paid out by the Fund. You owe the taxes whether you receive cash or
choose to have distributions and dividends reinvested. Distributions and
dividends usually create the following tax liability:

<TABLE>
<CAPTION>
<S> <C>
Transaction Tax Status
</TABLE>
<TABLE>
<S> <C>
Income dividends Ordinary income
-------------------------------------
Short-term capital Ordinary income
gains distributions
-------------------------------------
Long-term capital Capital gains
gains distributions
-------------------------------------
</TABLE>

Every year the Fund will send you information on the distributions for the
previous year. In addition, if you sell your Fund shares you may have a capital
gain or loss.

<TABLE>
<CAPTION>
<S> <C>
Transaction Tax Status
</TABLE>
<TABLE>
<S> <C>
Your sale of shares Capital gains or losses
owned more than one year
-------------------------------------------------
Your sale of shares Gains treated as ordinary
owned for one year or income, losses subject to
less special rules.
-------------------------------------------------
</TABLE>

The tax considerations for tax deferred accounts or non-taxable entities will
be different.

Because each investor's tax circumstances are unique and because the tax laws
are subject to change, we recommend that you consult your tax advisor about
your investment.
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10
<PAGE>

A Detailed Look at Equity Appreciation--Institutional Class

BUYING AND SELLING FUND SHARES

Contacting the Mutual Fund Service Center of
Deutsche Asset Management

<TABLE>
<S> <C>
By phone 1-800-368-4031
By mail Service Center
P.O. Box 219210
Kansas City, MO 64141-9210
By overnight Service Center
mail 210 West 10th Street, 8th floor
Kansas City, MO 64105-1716
</TABLE>

Our representatives are available to assist you personally Monday through
Friday, 9:00 a.m. to 7:00 p.m., Eastern time each day the New York Stock
Exchange is open for business. You can reach the Service Center's automated
assistance line 24 hours a day, 7 days a week.

Minimum Account Investments

<TABLE>
<S> <C>
To open an account $250,000
To add to an account $ 25,000
Minimum account balance $ 50,000
</TABLE>

The Fund and its service providers reserve the right to, from time to time and
in their discretion, waive or reduce the investment minimum.

How to Open Your Fund Account

<TABLE>
<S> <C>
By mail Complete and sign the account
application that accompanies this
prospectus. (You may obtain
additional applications by calling
the Service Center.) Mail the
completed application along with a
check payable to Equity Fund
Appreciation--477.
By wire Call the Service Center to set up
a
wire account.
</TABLE>

Please note that your account cannot become activated until we receive a
completed application via mail or fax.

Two Ways to Buy and Sell Shares in Your Account

MAIL:

Buying: Send your check, payable to "Equity Appreciation-- 477," to the
Service Center. The addresses are shown above under "Contacting the Mutual
Fund Service Center of Deutsche Asset Management." Be sure to include the fund
number and your account number (see your account statement) on your check.
Please note that we cannot accept starter checks or third-party checks. If you
are investing in more than one fund, make your check payable to "Deutsche
Asset Management (Mutual Funds)," include your account number and the names
and numbers of the funds you have selected, and the dollar amount or
percentage you would like invested in each Fund.

Selling: Send a signed letter to the Service Center with your name, your fund
number and account number, the fund's name, and either the number of shares
you wish to sell or the dollar amount you wish to receive. You must leave at
least $50,000 worth of shares in your account to keep it open. Unless
exchanging into another Deutsche Asset Management mutual fund, you must submit
a written authorization to sell shares in a retirement account.

WIRE:

Buying: You may only buy shares by wire if your account is authorized to do
so. Please note that you or your service agent must call the Service Center at
1-800-368-4031 to notify us in advance of a wire transfer purchase. Inform the
Service Center representative of the amount of your purchase and receive a
trade confirmation number. Instruct your bank to send payment by wire using
the wire instructions noted below. All wires must be received by 4:00 p.m.
Eastern time the next business day.

<TABLE>
<S> <C>
Routing No: 021001033
Attn: Deutsche Asset Management/
Mutual Funds
DDA no: 00-226-296
FBO: (Account name)
(Account number)
Credit: Equity Appreciation--477
</TABLE>

Refer to your account statement for the account name and number.

Selling: You may sell shares by wire only if your account is authorized to do
so. For your protection, you may not change the destination bank account over
the phone. To sell by wire, contact your service agent or the Service Center
at 1-800-368-4031. Inform the Service Center representative of the amount of
your redemption and receive a trade confirmation number. The minimum
redemption by wire is $1,000. We must receive your order by 4:00 p.m. Eastern
time to wire your account the next business day.
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11
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A Detailed Look at Equity Appreciation--Institutional Class

Important Information about Buying and Selling Shares

. You may buy and sell shares of a fund through authorized service agents as
well as directly from us. The same terms and conditions apply. Specifically,
once you place your order with a service agent, it is considered received by
the Service Center. It is then your service agent's responsibility to
transmit the order to the Service Center by the next business day. You should
contact your service agent if you have a dispute as to when your order was
placed with the fund.

. You may place orders to buy and sell over the phone by calling your service
agent or the Service Center at 1-800-368-4031. If you pay for shares by check
and the check fails to clear, or if you order shares by phone and fail to pay
for them by 4:00 p.m. Eastern time the next business day, we have the right
to cancel your order, hold you liable or charge you or your account for any
losses or fees a fund or its agents have incurred. To sell shares, you must
state whether you would like to receive the proceeds by wire or check.

. After we or your service agent receives your order, we buy or sell your
shares at the next price calculated on a day the New York Stock Exchange is
open for business.

. We accept payment for shares only in U.S. dollars by check, bank or Federal
Funds wire transfer, or by electronic bank transfer. Please note that we
cannot accept starter checks or third-party checks.

. The payment of redemption proceeds (including exchanges) for shares of a fund
recently purchased by check may be delayed for up to 15 calendar days while
we wait for your check to clear.

. We process all sales orders free of charge.

. Unless otherwise instructed, we normally mail a check for the proceeds from
the sale of your shares to your account address the next business day and no
later than seven days.

. We reserve the right to close your account on 30 days' notice if it fails to
meet minimum balance requirements for any reason other than a change in
market value.

. If you sell shares by mail or wire, you may be required to obtain a signature
guarantee. Please contact your service agent or the Service Center for more
information.

. We remit proceeds from the sale of shares in U.S. dollars (unless the
redemption is so large it is made "in-kind").

. We do not issue share certificates.

. Selling shares of trust accounts and business or organization accounts may
require additional documentation. Please contact your service agent or the
Service Center for more information.

. During periods of heavy market activity, you may have trouble reaching the
Service Center by telephone. If this occurs, you should make your request by
mail.

. We reserve the right to reject purchases of Fund shares (including exchanges)
for any reason. We will reject purchases if we conclude that the purchaser
may be investing only for the short-term or for the purpose of profiting from
day to day fluctuations in the Fund's share price.

. We reserve the right to reject purchases of Fund shares (including exchanges)
or to suspend or postpone redemptions at times when both the New York Stock
Exchange and the Fund's custodian are closed

. Account Statements and Fund Reports: We or your service agent will furnish
you with a written confirmation of every transaction that affects your
account balance. You will also receive monthly statements reflecting the
balances in your account. We will send you a report every six months on your
fund's overall performance, its current holdings and its investing
strategies.

Exchange Privilege

You can exchange all or part of your shares for shares of another Deutsche
Asset Management mutual fund up to four times a year (from the date of the
first exchange). When you exchange shares, you are selling shares in one fund
to purchase shares in another. Before buying shares through an exchange, you
should be sure to get a copy of that fund's prospectus and read it carefully.
You may only order exchanges over the phone if your account is authorized to do
so.

Please note the following conditions:

. The accounts between which the exchange is taking place must have the same
name, address and taxpayer ID number.

. You may make the exchange by phone, letter or wire, if your account has the
exchange by phone feature.

. If you are maintaining a taxable account, you may have to pay taxes on the
exchange.

. You will receive a written confirmation of each transaction from the Service
Center or your service agent.
- --------------------------------------------------------------------------------

12
<PAGE>

A Detailed Look at Equity Appreciation--Institutional Class

The table below provides a picture of the Fund's financial performance for the
past five years. The information selected reflects financial results for a
single Fund share. The total returns in the table represent the rate of return
that an investor would have earned on an investment in the Fund (assuming
reinvestment of all interest income and distributions). This information has
been audited by PricewaterhouseCoopers LLP whose report, along with the Fund's
financial statements, is included in the Fund's annual report. The annual
report is available free of charge by calling the Service Center at 1-800-730-
1313.
Financial Highlights

<TABLE>
<CAPTION>
For the
period
January 1, For the year
For the year ended September 30, 1995 through ended
1999 1998 1997 1996 September 30, December 31,
1995/1/ 1994
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net Asset Value,
Beginning of Period $13.98 $16.70 $15.23 $14.14 $10.14 $9.80
---------------------------------------------------------------------------------------------------
Income From Investment
Operations
Expenses in Excess of
Income (0.06) (0.07) (0.06) (0.05) (0.02) (0.03)
---------------------------------------------------------------------------------------------------
Net Realized and
Unrealized Gain (Loss)
on Investments
Transactions 6.25 (1.68) 2.31 1.72 4.02 0.37
---------------------------------------------------------------------------------------------------
Total from Investment
Operations 6.19 (1.75) 2.25 1.67 4.00 0.34
---------------------------------------------------------------------------------------------------
Distributions to
Shareholders
Net Realized Gains (0.06) (0.97) (0.78) (0.58) -- --
---------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $20.11 $13.98 $16.70 $15.23 $14.14 $10.14
---------------------------------------------------------------------------------------------------
Total Investment Return 44.33% (10.68)% 15.82% 12.45% 39.45% 3.47%
---------------------------------------------------------------------------------------------------
Supplemental Data and
Ratios:
Net Assets, End of
Period (000s omitted) $171,709 $122,077 $170,008 $157,568 $92,033 $29,973
---------------------------------------------------------------------------------------------------
Ratios to Average Net
Assets:
Expenses in Excess of
Income (0.31)% (0.36)% (0.39)% (0.42)% (0.38)%/2/ (0.32)%
---------------------------------------------------------------------------------------------------
Expenses 1.00% 1.00% 1.00% 1.00% 1.00%/2/ 1.00%
---------------------------------------------------------------------------------------------------
Decrease Reflected in
Above Expense Ratio Due
to Fees Waived/Expenses
Reimbursed by Bankers
Trust 0.20% 0.20% 0.20% 0.24% 0.33%/2/ 0.46%
---------------------------------------------------------------------------------------------------
Portfolio Turnover
Rate/3/ 165% 159% 188% 271%/4/ 125%/4/ 157%/4/
---------------------------------------------------------------------------------------------------
</TABLE>
/1/The Board of Trustees approved the change of the Fund's year end from De-
cember 31 to September 30.

/2/Annualized.
/3/The portfolio turnover rate is the rate for the master portfolio in which
the Fund invests all its assets.
/4/Amounts were previously included in the Capital Appreciation Fund Financial
Highlights.
- -------------------------------------------------------------------------------

13
<PAGE>

This page left intentionally blank

<PAGE>

This page left intentionally blank

<PAGE>

Additional information about the Fund's investments and performance is
available in the Fund's annual and semi-annual reports to shareholders. In
the Fund's annual report, you will find a discussion of the market
conditions and investment strategies that significantly affected the Fund's
performance during its last fiscal year.

You can find more detailed information about the Fund in the current
Statement of Additional Information, dated January 31, 2000, which we have
filed electronically with the Securities and Exchange Commission (SEC) and
which is incorporated by reference. To receive your free copy of the
Statement of Additional Information, the annual or semi-annual report, or
if you have questions about investing in the Fund, write to us at:

Service Center
P.O. Box 219210
Kansas City, MO 64121-9210
or call our toll-free number at 1-800-730-1313

You can find reports and other information about each Fund on the EDGAR
Database on the SEC's website (http://www.sec.gov), or you can get copies
of this information, after payment of a duplicating fee, by electronic
request at [email protected] or by writing to the Public Reference Section
of the SEC, Washington, D.C. 20549-0102. Information about each Fund,
including its Statement of Additional Information, can be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. For
information on the Public Reference Room, call the SEC at 202-942-8090.

Equity Appreciation--Institutional Class
BT Pyramid Mutual Funds

Distributed by:
ICC Distributors, Inc. CUSIP
Two Portland Square #055922751
Portland, ME 04101 477PRO (1/00)
811-6576

<PAGE>

DEUTSCHE ASSET MANAGEMENT

Mutual Fund
Prospectus
January 31, 2000
Investment Class

PreservationPlus
formerly BT PreservationPlus Fund -- Service Class
<TABLE>
<CAPTION>
<S> <C>
The Fund is designed exclusively for participant-directed employee benefit plans.

[Like shares of all mutual funds, these securities have
not been approved or disapproved by the Securities
and Exchange Commission nor has the Securities and
Exchange Commission passed upon the accuracy or
adequacy of this prospectus. Any representation to the A Member of the
contrary is a criminal offense.] DEUTSCHE BANK GROUP

</TABLE>

<PAGE>

Overview
- --------------------------------------------------------------------------------
of PreservationPlus

Goal: The Fund seeks a high level of current income while seeking to maintain a
stable value per share.
Core Strategy: The Fund invests primarily in fixed income securities. The Fund
also enters into contracts with financial institutions that are designed to
stabilize the Fund's share value.

INVESTMENT POLICIES AND STRATEGIES
The Fund invests all of its assets in a master portfolio with the same goal as
the Fund. The Fund, through the master portfolio, seeks to achieve that goal by
investing in fixed income securities of varying maturities, money market
instruments and futures and options. The Fund attempts to maintain a stable
share value by entering into contracts, called Wrapper Agreements, with
financial institutions, such as insurance companies and banks.

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

PreservationPlus

Overview of PreservationPlus

A Detailed Look at PreservationPlus

<TABLE>
<S> <C>
Objective................................................................... 7
Strategy.................................................................... 7
Principal Investments....................................................... 7
Investment Process.......................................................... 8
Risks....................................................................... 9
Management of the Fund...................................................... 10
Calculating the Fund's Share Price.......................................... 11
Dividends and Distributions................................................. 11
Tax Considerations.......................................................... 12
Buying and Selling Fund Shares.............................................. 12
Financial Highlights........................................................ 14
</TABLE>
- --------------------------------------------------------------------------------

3
<PAGE>

Overview of PreservationPlus

PRINCIPAL RISKS OF INVESTING IN THE FUND

Although the Fund seeks to preserve a stable share value, there are risks
associated with fixed income investing. For example, the value of fixed income
securities could fluctuate or fall if:

. There is a sharp rise in interest rates.
. An issuer's creditworthiness declines.
. Changes in interest rates or economic downturns have a negative effect on
issuers in the financial services industry.

The Fund attempts to offset these risks by purchasing Wrapper Agreements. The
use of Wrapper Agreements has its own risks, including:

. The possibility of default by a financial institution providing a Wrapper
Agreement ("Wrapper Provider").
. The inability of the Fund to obtain Wrapper Agreements covering the Fund's
assets.

The Fund is also subject to the risk that we incorrectly judge the potential
risks and rewards of investing in derivatives.

WHO SHOULD CONSIDER INVESTING IN THE FUND

You should consider investing in the Fund if you are seeking current income
higher than money market mutual funds over most time periods and to preserve
the value of your investment. The Fund is offered as an alternative to short-
term bond funds and as a comparable investment to stable value or guaranteed
investment contract options offered in employee benefit plans.

PreservationPlus offers shares only to participant-directed employee benefit
plans. Sales are made: 1) directly or 2) indirectly through vehicles like
insurance company separate accounts or bank collective funds. Plans investing
in the Fund are required to impose certain restrictions on their participants'
ability to exchange shares of the Fund. Benefit plans investing in the Fund
must limit their participants' ability to direct a withdrawal from the Fund to
the following circumstances:

. upon the plan participant's death, retirement, disability or termination;
. to fund plan participant loans and other "in service" withdrawals made
pursuant to the terms of the plan; and
. for transfers to other plan investment options that are not competing funds.
Transfers between the Fund and a non-competing fund will be required to
remain in the non-competing fund for a period of at least three months before
transfer to a competing fund.

You should not consider investing in PreservationPlus if you seek capital
growth. Although it provides a convenient means of diversifying short-term
investments, the Fund by itself does not constitute a balanced investment
program.

An investment in PreservationPlus is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve a stable share value, it is
possible to lose money by investing in the Fund.
- --------------------------------------------------------------------------------

Competing funds are any fixed income investment options with a targeted average
duration of three years or less, or any investment option that seeks to
maintain a stable value per unit or share, including money market funds.
- --------------------------------------------------------------------------------

4
<PAGE>

Overview of PreservationPlus

TOTAL RETURNS, AFTER FEES AND EXPENSES

The bar chart and table on this page can help you evaluate the potential risks
and rewards of investing in the Investment Class shares of the Fund. The bar
chart shows the Investment Class' actual return for each full calendar year
since it began selling those shares on September 23, 1998 (its inception date).
The table compares the Investment Class' average annual return with the Lehman
1-3 Year Government/Corporate Total Return Index, the IBC First Tier Retail
Money Market Universe, and the Wrapped Lehman Intermediate Aggregate Index,
over the last year and since the Fund's inception. An index is a group of
securities whose overall performance is used as a standard to measure
investment performance. It does not factor in the costs of buying, selling and
holding securities--costs that are reflected in the Fund's results.

As of December 31, 1999, the Fund's 30-day yield was 5.32%.
- --------------------------------------------------------------------------------

The Lehman 1-3 Year Government/Corporate Total Return Index is a widely
accepted benchmark of short-term fixed income securities. It is a total return
index consisting of all U.S. Government agency securities, U.S. Government
Treasury securities and all investment grade corporate debt securities with
maturities of one to three years. The Wrapped Lehman Intermediate Aggregate
Index is a custom benchmark representing investment in a portfolio consisting
of the Lehman Intermediate Aggregate Index and a book value wrapper agreement,
at an assumed expense level of 0.15%. The Wrapped Lehman Index more closely
reflects the market sector in which the Fund invests than the other Lehman
index.

The 30-day yield is a measure of the income generated by the Fund over a
thirty-day period. This amount is then annualized, which means that we assume
the Fund generates the same income every month for a year. The "total return"
of the Fund is the change in the value of an investment in the Fund over a
given period. Average annual returns are calculated by averaging the year-by-
year returns of the Fund over a given period.

Year-by-Year Returns
(each full calendar year since inception)

[CHART APPEARS HERE]

1999 5.24%

Since inception, the Investment Class' highest return in any calendar quarter
was 1.34% (fourth quarter 1998) and its lowest quarterly return was 1.26%
(second quarter 1999). Past performance offers no indication of how the Fund
will perform in the future.

PERFORMANCE FOR THE PERIOD ENDED 12/31/99

<TABLE>
<CAPTION>
Average Annual Returns
1 Year Since
Inception
(September 23,
1998)
<S> <C> <C>
PreservationPlus -
Investment Class 5.24% 5.29%
----------------------------------------------------
Lehman 1-3 Year
Government/
Corporate
Total Return Index/1/ 3.15% 3.17%
----------------------------------------------------
IBC First Tier Retail
Money
Market Universe/2/ 4.58% 4.60%
----------------------------------------------------
Wrapped Lehman
Intermediate
Aggregate Index 5.40% 5.37%
----------------------------------------------------
</TABLE>

/1/ The Lehman 1-3 Year
Government/Corporate Total Return
Index and IBC First Tier Retail Money
Market Universe Average are
calculated from September 30, 1998.
/2/ Unweighted average return, net of
fees and expenses, of all money mar-
ket mutual funds that invested in
non-Government securities, that are
restricted to those money market in-
struments rated first tier (the top
rating) by two or more nationally
recognized statistical rating organi-
zations.
- --------------------------------------------------------------------------------

5
<PAGE>

Overview of PreservationPlus

ANNUAL FUND OPERATING EXPENSES

The Shareholder Fees and Annual Fees and Expenses tables to the right describe
the fees and expenses that you may pay if you buy and hold shares of the
PreservationPlus--Investment Class.

Under normal circumstances, redemptions of shares that are directed by plan
participants are not subject to a redemption fee. Redemptions of Shares that
are not directed by plan participants and that are made on less than twelve
months' prior written notice to the Fund are subject to a redemption fee of 2%
of the amount redeemed payable to the Fund.

Investment Class shares are subject to shareholder servicing fees in the
maximum amount of 0.25% of the average daily net assets of the shares. The
shareholder services provided in exchange for these fees may include
establishing and maintaining shareholder and plan participant accounts,
processing purchase and redemption transactions, arranging for bank wires,
performing shareholder sub-accounting, answering investor/shareholder's
inquiries regarding the Fund and/or its classes, providing periodic statements
showing the investor/shareholder's account balance and those of plan
participants, transmitting proxy statements, periodic reports, updated
prospectuses and other communications to shareholders and, with respect to
meetings of shareholders, collecting, tabulating executed proxies and obtaining
such other information and performing such other services as may reasonably be
required.

Expense Example. This example illustrates the expenses you would have incurred
on a $10,000 investment in the Fund. It assumes that the Fund earned an annual
return of 5% over the periods shown, that the Fund's operating expenses
remained the same, and that you sold your shares at the end of the period. The
expense example does not include a redemption fee.

You may use this hypothetical example to compare the Fund's expense history
with other funds./1/ Your actual costs may be higher or lower.

SHAREHOLDER FEES
(fees paid directly from your investment)

<TABLE>
<S> <C>
Maximum Sales Charge Imposed on
Purchases None
--------------------------------------------
Maximum Sales Charge on Reinvested
Dividends None
--------------------------------------------
Maximum Redemption Fee (as a
percentage of amount redeemed, as
applicable) 2.0%
--------------------------------------------
</TABLE>

ANNUAL FEES AND EXPENSES
(expenses paid from fund assets)

<TABLE>
<CAPTION>
Percentage of average
daily net assets/1/
<S> <C>
Management Fees 0.35%
--------------------------------------------------
Distribution and
Service (12b-1) Fees None
--------------------------------------------------
Other Fund Operating
Expenses 0.83%/2/
--------------------------------------------------
Total Fund Operating
Expenses 1.18%
--------------------------------------------------
Less: Fee Waiver or
Expense Reimbursements 0.53%/3/
--------------------------------------------------
Net Expenses 0.65%
--------------------------------------------------
</TABLE>

Expense Example/4/

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

/1/ Information on the annual operating expenses reflects the expenses of both
the Fund and the PreservationPlus Portfolio, the master portfolio into which
PreservationPlus invests all of its assets. (A further discussion of the
relationship between the Fund and the master portfolio appears in the
"Orgazitional Structure" section of this prospectus.)

/2/ "Other Expenses" include the annual premium rate the Fund paid for Wrapper
Agreements and a shareholder servicing fee of 0.25%.

/3/ The investment adviser and administrator have agreed, for the 16-month
period from the Fund's fiscal year end of September 30, 1999, to waive their
fees and reimbursement expenses so that total expenses will not exceed 0.65%.

/4/ For the first 16 months, the expense example takes into account fee waivers
and reimbursements.
- --------------------------------------------------------------------------------

6
<PAGE>

A detailed look
- --------------------------------------------------------------------------------
at PreservationPlus

OBJECTIVE

PreservationPlus seeks a high level of current income while seeking to maintain
a stable value per share.

The Fund invests for current income; capital appreciation is not a goal of the
Fund. While we give priority to earning income and maintaining the value of the
Fund's principal, we cannot offer any assurance of achieving this goal.

STRATEGY

The Fund seeks current income that is higher than that of money market funds by
investing in fixed income securities with varying maturities and maintaining an
average portfolio duration of 2.5 to 4.5 years. In addition, the Fund enters
into Wrapper Agreements designed to stabilize the Fund's share value. Wrapper
Agreements are provided by financial institutions, such as insurance companies
and banks.

PRINCIPAL INVESTMENTS

Fixed Income Securities. The Fund invests at least 65% of its net assets in
fixed income securities including:

. U.S. government securities that are issued or guaranteed by the U.S.
Treasury, or by agencies or instrumentalities of the U.S. Government.

. U.S. dollar-denominated securities issued by domestic or foreign
corporations, foreign governments or supranational entities.

. U.S. dollar-denominated asset-backed securities issued by domestic or foreign
entities.

. Mortgage pass-through securities issued by governmental and non-governmental
issuers.

. Collateralized mortgage obligations and real estate mortgage investment
conduits.

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

Duration measures the sensitivity of bond prices to changes in interest rates.
The longer the duration of a bond, the longer it will take to repay the
principal and interest obligations and the more sensitive it is to changes in
interest rates. Investors in longer-duration bonds face more risk as interest
rates rise--but also are more likely to receive more income from their
investment to compensate for the risk.

. Obligations issued or guaranteed, or backed by securities issued or
guaranteed, by the U.S. government, or any of its agencies or
instrumentalities, including CATS, TIGRs, TRs and zero coupon securities,
which are securities consisting of either the principal component or the
interest component of a U.S. Treasury bond.

We employ the following policies to attempt to reduce the risks involved in
investing in fixed income securities:

. We allocate assets among a diversified group of issuers.

. We primarily invest in fixed income securities that are rated, at the time of
purchase, within the top three rating categories as rated by Moody's
Investors Service, Inc., Standard & Poor's Ratings Service or Duff & Phelps
Credit Rating Co., another nationally recognized statistical rating
organization, or, if unrated, are determined by us to be of comparable
quality.

. We target an average portfolio duration of 2.5 to 4.5 years by investing in
fixed income securities with short- to intermediate-term maturities.
Generally, rates of short-term investments fluctuate less than longer-term
investments.

Maturity measures the time remaining until an issuer must repay a bond's
principal in full.

Book value of the Covered Assets is their purchase price, plus interest (as
specified in the Wrapper Agreement), less an adjustment to reflect any
defaulted securities.
- --------------------------------------------------------------------------------

7
<PAGE>

A Detailed Look at PreservationPlus

are made and the timing of payments between the Fund and the Wrapper Provider
vary. More than one Wrapper Provider provides coverage with respect to the same
securities and pays, when applicable, based on the pro rata portion of the
Fund's assets that it covers.

The Crediting Rate:

. Is the actual interest earned on the Covered Assets based on the formula
stated in the Wrapper Agreements and is generally adjusted monthly for price
movements in the Covered Assets and amounts payable to or receivable from the
Wrapper Provider; and

. Is a significant component of the Fund's yield.

We employ the following policies to attempt to reduce the risks involved in
using Wrapper Agreements:

. We purchase Wrapper Agreements from multiple issuers, each of which has
received a high quality rating from Moody's or Standard & Poor's.

. We monitor, on a continual basis, the financial well being of the issuers of
the securities in which the Fund invests and the Wrapper Providers providing
Wrapper Agreements to the Fund.

Generally, unless the Wrapper Agreement requires the sale of a security that
has been downgraded below a specified rating, the Fund is not required to
dispose of any security or Wrapper Agreement whose issuer's rating has been
downgraded.

Short-Term Investments. The Fund will also invest in short-term investments,
including money market mutual funds, to meet shareholder withdrawals and other
liquidity needs. These short-term investments, such as commercial paper and
certificates of deposit, will be rated, at the time of purchase, within one of
the top two short-term rating categories by a nationally recognized statistical
rating organization, or if unrated, are determined by us to be of similar
quality.

Derivative Instruments. The Fund may invest in various instruments commonly
known as "derivatives" to increase its exposure to certain groups of
securities. The derivatives that the Fund may use include futures contracts,
options on futures
- --------------------------------------------------------------------------------

A high quality rating means a security is rated within the top two long-term
ratings categories by a nationally recognized statistical rating organization.

Futures contracts, options on futures contracts and forward contracts are
commonly used for traditional hedging purposes to attempt to protect an
investor from the risks of changing interest rates, securities prices or
currency exchange rates and for cash management purposes as a low cost method
of gaining exposure to a particular securities market without investing
directly in those securities.
contracts and forward contracts. The Fund may use
derivatives to keep cash on hand to meet shareholder redemptions, as a hedging
strategy to maintain a specific portfolio duration, or to protect against
market risk.

Other Investments. The Fund may also invest in and utilize the following
investments and investment techniques and practices: Rule 144A securities, to
be announced (TBA) securities, when-issued and delayed delivery securities,
repurchase agreements, reverse repurchase agreements and dollar rolls.

INVESTMENT PROCESS

The Fund's investment strategy emphasizes a diversified exposure to higher
yielding mortgage, corporate and asset-backed sectors of the investment grade
fixed income markets. These "spread" sectors have historically offered higher
returns than U.S. government securities. The investment process focuses on a
top-down approach, first focused on the sector allocations, then using relative
value analysis to select the best securities within each sector. To select
securities, we analyze such factors as credit quality, interest rate
sensitivity and spread relationships between individual bonds.

The Fund also purchases Wrapper Agreements, which seek to offset price
fluctuations of the fixed income securities and, as a result, provide a stable
value per share for the Fund. A primary emphasis is placed on assessing the
credit quality of financial institutions that may provide a Wrapper Agreement
to the Fund. We perform proprietary credit analysis on a large universe of
issuers. We actively manage the negotiation and maintenance of these Wrapper
Agreements.

Temporary Defensive Position. We may from time to time adopt a temporary
defensive position in response to extraordinary adverse political, economic or
market events. We may invest up to 100% of the Fund's assets in short-term
obligations within one of the top two investment ratings, if the situation
warranted. These short-term obligations may not be covered by a Wrapper
Agreement. To the extent we might adopt such a position and over the course of
its duration, the Fund may not meet its goal of a high level of current income
or a stable net asset value.
- --------------------------------------------------------------------------------

8
<PAGE>

A Detailed Look at PreservationPlus

RISKS

Below we set forth some of the prominent risks associated with fixed income
investing, the use of Wrapper Agreements, as well as the risks of investing in
general. Although we attempt to assess the likelihood that these risks may
actually occur and to limit them, we make no guarantee that we will succeed.

Primary Risks

Interest Rate Risk. All debt securities face the risk that the securities will
decline in value because of changes in interest rates. Generally, investments
subject to interest rate risk will decrease in value when interest rates rise
(and increase in value when interest rates fall).

Credit Risk. An investor purchasing a fixed income security faces the risk
that the value of the security may decline because the creditworthiness of the
issuer may decline or the issuer may fail to make timely payment of interest
or principal.

Wrapper Agreement Risk. Although the Fund uses Wrapper Agreements to attempt
to maintain a stable value per share, there are risks associated with the use
of Wrapper Agreements, including:

. A Wrapper Provider could default, which could cause the Fund's share value
to fluctuate and could result in losses for plan participants who sell their
shares.

. The Wrapper Agreements may require the Fund to maintain a certain percentage
of its assets in short-term investments. This could result in a lower return
than if the Fund invested those assets in longer-term securities. The Fund
may elect not to cover a fixed income security with a remaining maturity of
60 days or less, cash or short-term investments with Wrapper Agreements.

. The Wrapper Agreements generally do not protect the Fund from loss caused by
a fixed income security issuer's default on principal or interest payments.

. The Fund may not be able to obtain Wrapper Agreements to cover all of its
assets.

. If a Wrapper Provider is unable to make timely payments, the Fund's Board
may determine the fair value of that Wrapper Agreement to be less than the
difference between the book value and the market value, which could cause
the Fund's net asset value to fluctuate.

. Compared to investing in a traditional fixed income fund, the Fund trades
the potential for capital appreciation and some yield for protection from a
decline in the value of its holdings caused by changes in interest rates.

Market Risk. Although individual securities may outperform their market, the
entire market may decline as a result of rising interest rates, regulatory
developments or deteriorating economic conditions.

Security Selection Risk. While the Fund invests in short- to intermediate-term
securities, which by nature are relatively stable investments, the risk
remains that the securities we have selected will not perform as expected.
This could cause the Fund's returns to lag behind those of money market funds.

Liquidity Risk. Liquidity risk is the risk that a security cannot be sold
quickly at a price that reflects our estimate of its value. Because there is
no active trading market for Wrapper Agreements, the Fund's investments in the
Wrapper Agreements are considered illiquid. In an effort to minimize this
risk, the Fund limits its investments in illiquid securities, including
Wrapper Agreements, to 15% of net assets.

Pricing Risk. When price quotations for securities are not readily available,
we determine their value by the method that most accurately reflects their
current worth in the judgment of the Board of Trustees. If Wrapper Agreements
are not in place, this procedure implies an unavoidable risk, the risk that
our prices are higher or lower than the prices that the securities might
actually command if we sold them. If we have valued the securities too highly,
you may end up paying too much for Fund shares when you buy. If we
underestimate their price, you may not receive the full market value for your
Fund shares when you sell.

According to the procedures adopted by the Board of Trustees, the fair value
of the Wrapper Agreements generally will equal the difference between the book
value and the market value (plus accrued interest) of the Fund's assets. In
determining fair value, the Board will consider the creditworthiness and
ability of a Wrapper Provider to pay amounts due under the Wrapper Agreements.
If the Board of Trustees determines that a Wrapper Agreement should not be
valued this way, the net asset value of the Fund could fluctuate.

Derivative Risk. Derivatives are more volatile and less liquid than
traditional fixed income securities. Risks associated with derivatives
include:

. the derivative may not fully offset the underlying positions;

. the derivatives used for risk management may not have the intended effects
and may result in losses or missed opportunities; and
- -------------------------------------------------------------------------------

9
<PAGE>

A Detailed Look at PreservationPlus

. the possibility the Fund cannot sell the derivative because of an illiquid
secondary market.

If the fund invests in futures contracts and options on futures contracts for
non-hedging purposes, the margin and premiums required to make those
investments will not exceed 5% of the Fund's net asset value after taking into
account unrealized profits and losses on the contracts. Futures contracts and
options on futures contracts used for non-hedging purposes involve greater
risks than other investments.

MANAGEMENT OF THE FUND

Board of Trustees. The Fund's shareholders, voting in proportion to the number
of shares each owns, elect a Board of Trustees, and the Trustees supervise all
of the Fund's activities on their behalf.

Investment Adviser. Under the supervision of the Board of Trustees, Bankers
Trust Company, with headquarters at 130 Liberty Street, New York, NY 10006,
acts as the Fund's investment adviser. Bankers Trust is an indirect wholly-
owned subsidiary of Deutsche Bank A.G. As investment adviser, Bankers Trust
makes the Fund's investment decisions. It buys and sells securities for the
Fund and conducts the research that leads to the purchase and sale decisions.
The investment adviser received a fee of 0.35% of the Fund's average daily net
assets for its services in the last fiscal year.

As of September 30, 1999, Bankers Trust had total assets under management of
approximately $285 billion. Bankers Trust is dedicated to servicing the needs
of corporations, governments, financial institutions, and private clients and
has invested retirement assets on behalf of the nation's largest corporations
and institutions for more than 50 years. The scope of the firm's capability is
broad: it is a leader in both the active and passive quantitative investment
disciplines and maintains a major presence in stock and bond markets worldwide.
As of December 31, 1999, Bankers Trust managed approximately $15 billion in
stable value assets.

At a special meeting of shareholders held in 1999, shareholders of the Fund
approved a new investment advisory agreement with Deutsche Asset Management,
Inc. (formerly Morgan Grenfell Inc.). The new investment advisory agreement may
be implemented within two years of the date of the special meeting upon
approval of a majority of the members of the Board of Trustees who are not
"interested persons," generally referred to as independent trustees.
Shareholders of the Fund also approved a new sub-investment advisory agreement
among the Trust, Deutsche Asset Management, Inc. and Bankers Trust under which
Bankers Trust may perform certain of Deutsche Asset Management, Inc.'s
responsibilities, at Deutsche Asset Management, Inc.'s expense, upon approval
of the independent trustees, within two years of the date of the special
meeting. Under the new investment advisory agreement and new sub-advisory
agreement, the compensation paid and the services provided would be the same as
those under the existing advisory agreement with Bankers Trust.

Deutsche Asset Management, Inc. is located at 885 Third Avenue, 32nd Floor, New
York, New York 10022. The firm provides a full range of investment advisory
services to institutional clients. It serves as investment adviser to 11 other
investment companies and as sub-adviser to five other investment companies.

As a result of the plea, absent an order from the SEC, Bankers Trust would not
be able to continue to provide investment advisory services to the Fund. The
SEC has granted a temporary order to permit Bankers Trust and its affiliates to
continue to provide investment advisory services to registered investment
companies. There is no assurance that the SEC will grant a permanent order.

Portfolio Managers. The following portfolio managers are responsible for the
day-to-day management of the master portfolio's investments:

Eric Kirsch, CFA

. Portfolio Manager of the master portfolio since its inception.

. Joined the investment adviser in 1980.

. Head of the Stable Value investment group.
- --------------------------------------------------------------------------------
10
<PAGE>

A Detailed Look at PreservationPlus

Louis R. D'Arienzo

. Portfolio Manager of the fixed income portion of the master portfolio since
its inception.

. Joined the investment adviser in 1981.

. Portfolio Manager in the Structured Fixed Income investment group.

John D. Axtell

. Portfolio Manager of the Wrapper Agreements in the master portfolio since its
inception.

. Joined the investment adviser in 1990.

. Portfolio Manager in the Stable Value investment group.

Other Services. Bankers Trust provides administrative services--such as
portfolio accounting, legal services and others--for the Fund. In addition,
Bankers Trust--or your service agent--performs the functions necessary to
establish and maintain your account. In addition to setting up the account and
processing your purchase and sale orders, these functions include:

. keeping accurate, up-to-date records for your individual Fund account;

. implementing any changes you wish to make in your account information;

. processing your requests for cash dividends and distributions from the Fund;

. answering your questions on the Fund's investment performance or
administration;

. sending proxy reports and updated prospectus information to you; and

. collecting your executed proxies.

Service agents include brokers, financial advisors or any other bank, dealer or
other institution that has a sub-shareholder servicing agreement with Bankers
Trust. Service agents may charge additional fees to investors only for those
services not otherwise included in the Bankers Trust servicing agreement, such
as cash management, or special trust or retirement-investment reporting.

Organizational Structure. The Fund is a "feeder fund" that invests all of its
assets in a "master portfolio," the PreservationPlus Portfolio. The Fund and
the master portfolio have the same investment objective. The master portfolio
is advised by Bankers Trust, an indirect wholly-owned subsidiary of Deutsche
Bank A.G.

The master portfolio may accept investments from other feeder funds. The
feeders bear the master portfolio's expenses in proportion to their assets.
Each feeder can set its own transaction minimums, fund-specific expenses, and
other conditions. This arrangement allows the Fund's Trustees to withdraw the
Fund's assets from the master portfolio if they believe doing so is in the
shareholders' best interests. If the Trustees withdraw the Fund's assets, they
would then consider whether the Fund should hire its own investment adviser,
invest in a different master portfolio or take other action.

CALCULATING THE FUND'S SHARE PRICE

We calculate the daily price of a Fund's shares (also known as the "net asset
value" or "NAV") in accordance with the standard formula for valuing mutual
fund shares at the close of regular trading on the New York Stock Exchange
every day the Exchange is open for business. The formula calls for deducting
all of a Fund's liabilities from the total value of its assets--the market
value of the securities it holds, plus its cash reserves--and dividing the
result by the number of shares outstanding.

We value the securities in the Fund at their stated market value if price
quotations are available. When price quotations for a particular security are
not readily available, we determine their value by the method that most
accurately reflects their current worth in the judgment of the Board of
Trustees. You can find the Fund's daily share price in the mutual fund listings
of most major newspapers.

According to the procedures adopted by the Board of Trustees, the fair value of
the Wrapper Agreements generally will equal the difference between the book
value and the market value (plus accrued interest) of the Fund's assets. In
determining fair value, the Board will consider the creditworthiness and
ability of a Wrapper Provider to pay amounts due under the Wrapper Agreements.

DIVIDENDS AND DISTRIBUTIONS

Income dividends, if any, for the Fund are declared daily and paid monthly. The
Fund reserves the right to include in the daily dividend any short-term capital
gains on securities that it sells. Also, the Fund will normally declare and pay
annually any long-term capital gains as well as any short-term capital gains
that it did not distribute during the year.
- --------------------------------------------------------------------------------
The Exchange is open every week, Monday through Friday, except when the
following holidays are celebrated: New Year's Day, Martin Luther King, Jr. Day
(the third Monday in January), Presidents' Day (the third Monday in February),
Good Friday, Memorial Day (the last Monday in May), Independence Day (July
4th), Labor Day (the first Monday in September), Thanksgiving Day (the fourth
Thursday in November) and Christmas Day.
- --------------------------------------------------------------------------------

11
<PAGE>

A Detailed Look at PreservationPlus

On occasion, the dividends the Fund distributes may differ from the income the
Fund earns. When the Fund's income exceeds the amount distributed to
shareholders, the Fund may make an additional distribution. When an additional
distribution is necessary, the Board of Trustees may declare a reverse stock
split to occur at the same time the additional distribution is made. Making
the additional distribution simultaneously with the reverse stock split will
minimize fluctuations in the net asset value of the Fund's shares.

We automatically reinvest all dividends and capital gains, if any, unless you
elect to receive your distributions in cash.

TAX CONSIDERATIONS

The Fund does not ordinarily pay income taxes. You and other shareholders pay
taxes on the income or capital gains from the Fund's holdings. For plan
participants utilizing the Fund as an investment option under their plan,
dividend and capital gain distributions from the Fund generally will not be
subject to current taxation, but will accumulate on a tax-deferred basis.

Because each participant's tax circumstances are unique and because the tax
laws governing plans are complex and subject to change, we recommend that you
consult your plan administrator, your plan's Summary Plan Description, and/or
your tax advisor about the tax consequences of your participation in your plan
and of any plan contributions or withdrawals.

BUYING AND SELLING FUND SHARES

The Fund does not sell its shares directly to the public. The Fund offers
shares only to certain participant-directed employee benefit plans. These
benefit plans may own the Fund's shares: 1) directly or 2) indirectly through
other investment vehicles such as an insurance company separate account or
bank collective funds, which offer the Fund as an investment option to its
participants.

Benefit plans investing in the Fund must limit their participants' ability to
direct a withdrawal from the Fund to the following circumstances:

. upon the plan participant's death, retirement, disability or termination;

. to fund plan participant loans and other "in service" withdrawals made
pursuant to the terms of the plan; and

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

A reverse stock split reduces the number of total shares the Fund has
outstanding. The market value of the shares will be the same after the stock
split as before the split, but each share will be worth more.

. for transfers to other plan investment options that are not competing funds.
Transfers between the Fund and a non-competing fund will be required to
remain in the non-competing fund for a period of at least three months
before transfer to a competing fund.

How To Receive Account Information

. If you are a plan participant, you should contact your plan administrator or
the organization that provides record-keeping services for information about
your account.

. If you are a plan administrator or fiduciary, you should call 1-800-677-7596
for information about the plan's account with the Fund.

Transactions in Fund Shares

Each plan has different provisions about how and when their participants may
buy, sell and exchange Fund shares. The plan administrator is responsible for
communicating participants' instructions to the Fund. Plan participants should
contact their plan administrator to effect transactions in the Fund.

Important Information About Buying and Selling Shares

. After receiving a plan's order, the Fund buys or sells shares at the next
price calculated on any day the Fund is open for business.

. Unless otherwise instructed, the Fund normally makes payment of the proceeds
from the sale of plan shares the next business day but always within seven
days.

. The redemption fee does not apply to exchanges into another class of shares
of the Fund, into another investment company or other entity that invests
exclusively in the master portfolio.

. The Fund remits proceeds from the sale of shares in U.S. dollars for
redemption requests up to $500,000 or 1% of the Fund's NAV, whichever is
less, during any 90-day period for any one shareholder. The Fund may redeem
"in kind" if a redemption request is larger than the lesser of $500,000 or
1% of the Fund's NAV. The Fund may also redeem "in kind" if a redemption
request is not directed by a plan participant and is made on less than
twelve months' notice. In these situations, the Fund may require additional
information.

. The Fund does not issue share certificates.
- -------------------------------------------------------------------------------

12
<PAGE>

A Detailed Look at PreservationPlus

. The Fund may request additional information about the plan when an order to
redeem 5% or more of a plan's assets is received.

. Sales orders not directed by plan participants and received on less than
twelve months prior written notice are subject to a 2% redemption fee.

. We reserve the right to reject purchases of Fund shares (including exchanges)
for any reason. We will reject purchases if we conclude that the purchaser
may be investing only for the short-term.

13
<PAGE>

A Detailed Look at PreservationPlus

The table below provides a picture of the Investment Class' financial
performance since its inception. The information selected reflects financial
results for a single Fund share. The total returns in the table represent the
rate of return that an investor would have earned on an investment in the Fund
(assuming reinvestment of all dividends and distributions). This information
has been audited by Ernst & Young LLP whose report, along with the Fund's
financial statements, is included in the Fund's annual report. The annual
report is available free of charge by calling the Service Center at 1-800-677-
7596.

Financial Highlights

<TABLE>
<CAPTION>
For the period
September 23, 1998/1/
For the year ended through
September 30, 1999 September 30, 1998
<S> <C> <C>
Per Share Operating Performance:
Net Asset Value, Beginning of Period $10.00 $10.00
----------------------------------------------------------------------------------------------------------------
Income from Investment Operations
Net Investment Income 0.51 0.01
----------------------------------------------------------------------------------------------------------------
Distributions to Shareholders
Net Investment Income (0.51) (0.01)
----------------------------------------------------------------------------------------------------------------
Net Realized Gains/3/ (0.05) --
----------------------------------------------------------------------------------------------------------------
Reverse Stock Split/3/ 0.05 --
----------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.00 $10.00
----------------------------------------------------------------------------------------------------------------
Total Investment Return 5.25% 5.42%/2/
----------------------------------------------------------------------------------------------------------------
Supplemental Data and Ratios:
Net Assets, End of Period (000s omitted) $17,099 $404
----------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Net Investment Income 5.20% 5.42%/2/
----------------------------------------------------------------------------------------------------------------
Net Expenses, Including Expenses of the PreservationPlus Portfolio 0.80% 0.80%/2/
----------------------------------------------------------------------------------------------------------------
Decrease Reflected in Above Expense Ratio Due to Waived Fees/Expenses
Reimbursed by Bankers Trust 0.38% 0.43%/2/
----------------------------------------------------------------------------------------------------------------
Portfolio turnover rate/4/ 291% 428%/5/
----------------------------------------------------------------------------------------------------------------
</TABLE>
/1/Commencement of operations.
/2/Annualized.
/3/In order to comply with requirements of the Internal Revenue Code applica-
ble to regulated investment companies, the Fund is required to distribute ac-
cumulated net realized gains, if any, on a annual basis. When such distribu-
tions are made, the immediate impact is a corresponding reduction in the net
asset value per share of each class of the Fund. Given the objective of the
Fund to maintain a stable net asset value of $10 per share, the Fund intends
to declare a reverse stock split immediately subsequent to any such distribu-
tions at a rate that will cause the total number of shares held by each share-
holder, including shares acquired on reinvestment of that distribution, to re-
main the same as before the distribution was paid and in effect reinstate a
net asset value of $10 per share.
On December 4, 1998, the Fund declared a capital gain distribution of $0.05
per share and a corresponding reverse stock split of .995 per share. There was
no effect on the value of the total holdings of each shareholder (assuming re-
investment of such distributions) as a result of this activity.
/4/The portfolio turnover rate is the rate for the master portfolio, into
which the Fund invests its assets.
/5/For the period October 1, 1997 to September 30, 1998.
- --------------------------------------------------------------------------------

14
<PAGE>

This page intentionally left blank
<PAGE>

Additional information about the Fund's investments is available in the
Fund's annual and semi-annual reports to shareholders. In the Fund's annual
report, you will find a discussion of the market conditions and investment
strategies that significantly affected the Fund's performance during its
last fiscal year.

Service Center
P.O. Box 219210
Kansas City, MO 64121-9210
or call our toll-free number: 1-800-677-7596

You can find reports and other information about the Fund on the EDGAR
Database on the SEC's website (http://www.sec.gov), or you can get copies
of this information, after payment of a duplicating fee, by electronic
request at [email protected] or by writing to the Public Reference Section
of the SEC, Washington, D.C. 20549-0102. Information about the Fund,
including its Statement of Additional Information, can be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. For
information on the Public Reference Room, call the SEC at 202-942-8090.

PreservationPlus
BT Pyramid Mutual Funds

Distributed by:
ICC Distributors, Inc. CUSIP
Two Portland Square #055847834
Portland, ME 04101 508PRO (1/00)
811-6576
<PAGE>

Deutsche Asset Management

Mutual Fund
Prospectus
January 31, 2000
Institutional Class

PreservationPlus
formerly BT PreservationPlus Fund -- Institutional Class

The Fund is designed exclusively for participant-directed employee benefit
plans.

[Like shares of all mutual funds, these securities have
not been approved or disapproved by the Securities
and Exchange Commission nor has the Securities and Exchange
Commission passed upon the accuracy or adequacy of this prospectus.
Any representation to the contrary is a criminal offense.]

A Member of the
Deutsche Bank Group [/]
<PAGE>

Overview
- --------------------------------------------------------------------------------
of PreservationPlus

Goal: The Fund seeks a high level of current income while seeking to maintain a
stable value per share.

Core Strategy: The Fund invests primarily in fixed income securities. The Fund
also enters into contracts with financial institutions that are designed to
stabilize the Fund's share value.

PreservationPlus

Overview of PreservationPlus

A Detailed Look at PreservationPlus

<TABLE>
<S> <C>
Objective................................................................... 7
Strategy.................................................................... 7
Principal Investments....................................................... 7
Investment Process.......................................................... 8
Risks....................................................................... 9
Management of the Fund...................................................... 10
Calculating the Fund's Share Price.......................................... 11
Dividends and Distributions................................................. 11
Tax Considerations.......................................................... 12
Buying and Selling Fund Shares.............................................. 12
Financial Highlights........................................................ 13
</TABLE>
- --------------------------------------------------------------------------------

3
<PAGE>

Overview of PreservationPlus

PRINCIPAL RISKS OF INVESTING IN THE FUND

Although the Fund seeks to preserve a stable share value, there are risks
associated with fixed income investing. For example, the value of fixed income
securities could fluctuate or fall if:

The Fund attempts to offset these risks by purchasing Wrapper Agreements. The
use of Wrapper Agreements has its own risks, including:

. The possibility of default by a financial institution providing a Wrapper
Agreement ("Wrapper Provider").
. The inability of the Fund to obtain Wrapper Agreements covering the Fund's
assets.

The Fund is also subject to the risk that we incorrectly judge the potential
risks and rewards of investing in derivatives.

WHO SHOULD CONSIDER INVESTING IN THE FUND

PreservationPlus offers shares only to participant-directed employee benefit
plans. The shares are available to employees benefit plans whose initial
investment equals or exceeds $25 million. Shares are also available to employee
benefit plans which invest in the Fund through an omnibus account or similar
arrangement, if that omnibus account or similar arrangement makes an initial
investment in the Fund of at least $25 million. Sales are made: 1) directly or
2) indirectly through vehicles like insurance company separate accounts or bank
collective funds. Plans investing in the Fund are required to impose certain
restrictions on their participants' ability to exchange shares of the Fund.
Benefit plans investing in the Fund must limit their participants' ability to
direct a withdrawal from the Fund to the following circumstances:

4
<PAGE>

Overview of PreservationPlus

TOTAL RETURNS, AFTER FEES AND EXPENSES

The bar chart and table on this page can help you evaluate the potential risks
and rewards of investing in the Institutional Class shares of the Fund. The bar
chart shows the Institutional Class' actual return for each full calendar year
since it began selling those shares on December 14, 1997 (its inception date).
The table compares the Institutional Class' average annual return with the
Lehman 1-3 Year Government/Corporate Total Return Index, the IBC First Tier
Retail Money Market Universe, and the Wrapped Lehman Intermediate Aggregate
Index, over the last year and since the Fund's inception. An index is a group
of securities whose overall performance is used as a standard to measure
investment performance. It does not factor in the costs of buying, selling and
holding securities--costs that are reflected in the Fund's results.

As of December 31, 1999, the Fund's 30-day yield was 5.73%.
- --------------------------------------------------------------------------------

Year-by-Year Returns
(each full calendar year since inception)

[CHART APPEARS HERE]

1998 5.73%
1999 5.65%

Since inception, the Institutional Class' highest return in any calendar
quarter was 1.45% (third quarter 1998) and its lowest quarterly return was
1.36% (second quarter 1999). Past performance offers no indication of how the
Fund will perform in the future.

PERFORMANCE FOR THE PERIOD ENDED 12/31/99

Average Annual Returns

1 Year Since Inception
(December 14,
1997)
PreservationPlus--
Institutional Class 5.65% 5.79%
------------------------------------------------
Lehman 1-3 Year
Government/Corporate
Total Return Index/1/ 3.15% 5.04%
------------------------------------------------
IBC First Tier Retail
Money Market
Universe/2/ 4.58% 4.77%
------------------------------------------------
Wrapped Lehman
Intermediate Aggregate
Index 6.03% 6.09%
------------------------------------------------

/1/The Lehman 1-3 Year Government/Corporate Total Return
Index and IBC First Tier Retail Money Market Universe
Average are calculated from December 31, 1997.

/2/Unweighted average return, net of fees and expenses,
of all money market mutual funds that invested in
non-Government securities, that are restricted to those
money market in struments rated first tier (the top rating)
by two or more nationally recognized statistical rating
organizations.

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

5
<PAGE>

Overview of PreservationPlus

ANNUAL FUND OPERATING EXPENSES

The Shareholder Fees and Annual Fees and Expenses tables to the right describe
the fees and expenses that you may pay if you buy and hold shares of
PreservationPlus--Institutional Class.

Expense Example. The example below illustrates the expenses you would have
incurred on a $10,000 investment in the Fund. It assumes that the Fund earned
an annual return of 5% over the periods shown, that the Fund's operating
expenses remained the same, and that you sold your shares at the end of the
period. The expense example does not include a redemption fee.

You may use this hypothetical example to compare the Fund's expense history
with other funds./1/ Your actual costs may be higher or lower.
- --------------------------------------------------------------------------------

/1/Information on the annual operating expenses reflects the expenses of both
the Fund and the PreservationPlus Portfolio, the master portfolio into which
PreservationPlus invests all of its assets. (A further discussion of the
relationship between the Fund and the master portfolio appears in the
"Organizational Structure" section of this prospectus.)

/2/"Other Expenses" include the annual premium rate the Fund paid for Wrapper
Agreements.

/3/The investment adviser and administrator have agreed, for the 16-month
period from the Fund's fiscal year end of September 30, 1999, to waive their
fees and reimburse expenses so that total expenses will not exceed 0.40%.

/4/For the first 16 months, the expense example takes into account fee waivers
and reimbursements.

SHAREHOLDER FEES
(fees paid directly from your investment)

ANNUAL FEES AND EXPENSES
(expenses paid from fund assets)

<TABLE>
<CAPTION>
Percentage of Average
Daily Net Assets/1/
<S> <C>
Management Fees 0.35%
------------------------------------------------
Distribution and
Service (12b-1) Fees None
------------------------------------------------
Other Fund Operating
Expenses 0.31%/2/
------------------------------------------------
Total Fund Operating
Expenses 0.66%
------------------------------------------------
Less: Fee Waivers or
Expense
Reimbursements 0.26%/3/
------------------------------------------------
Net Expenses 0.40%
------------------------------------------------
</TABLE>

Expense Example/4/

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C>
$41 $181 $345 $822
- -----------------------------------------------------------------------------------------------------------
</TABLE>

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

6
<PAGE>

A detailed look
- --------------------------------------------------------------------------------
at PreservationPlus

OBJECTIVE

PreservationPlus seeks a high level of current income while seeking to maintain
a stable value per share.

STRATEGY

PRINCIPAL INVESTMENTS

Fixed Income Securities. The Fund invests at least 65% of its net assets in
fixed income securities including:

. U.S. government securities that are issued or guaranteed by the U.S.
Treasury, or by agencies or instrumentalities of the U.S. Government.

. U.S. dollar-denominated securities issued by domestic or foreign
corporations, foreign governments or supranational entities.

. U.S. dollar-denominated asset-backed securities issued by domestic or foreign
entities.

. Mortgage pass-through securities issued by governmental and non-governmental
issuers.

. Collateralized mortgage obligations and real estate mortgage investment
conduits.

. Obligations issued or guaranteed, or backed by securities issued or
guaranteed, by the U.S. government, or any of its agencies or
instrumentalities, including CATS, TIGRs, TRs and zero coupon securities,
which are securities
- --------------------------------------------------------------------------------

consisting of either the principal component or the interest component of a
U.S. Treasury bond.

We employ the following policies to attempt to reduce the risks involved in
investing in fixed income securities:

. We allocate assets among a diversified group of issuers.

Wrapper Agreements. The Fund enters into Wrapper Agreements with insurance
companies, banks and other financial institutions. Unlike traditional fixed
income portfolios, the Fund's purchases of Wrapper Agreements should offset
substantially the price fluctuations typically associated with fixed income
securities. In using Wrapper Agreements, the Fund seeks to eliminate the effect
of any gains or losses on its value per share. Wrapper Agreements obligate the
Wrapper Provider to maintain the book value of the Covered Assets up to
specified amounts, under certain circumstances. In general, if the Fund sells
securities to meet shareholder redemptions and the market value (plus accrued
interest) of those securities is less than their book value, the Wrapper
Provider must pay the difference to the Fund. On the other hand, if the Fund
sells securities and the market value (plus accrued interest) is more than the
book value, the Fund must pay the difference to the Wrapper Provider. The
circumstances under which payments are made and the timing of payments between
the Fund and the Wrapper Provider vary. More than one Wrapper Provider provides
coverage with respect to the same securities and pays, when applicable, based
on the pro rata portion of the Fund's assets that it covers.
- --------------------------------------------------------------------------------
Maturity measures the time remaining until an issuer must repay a bond's
principal in full.
Book value of the Covered Assets is their purchase price, plus interest (as
specified in the Wrapper Agreement), less an adjustment to reflect any
defaulted securities.
- --------------------------------------------------------------------------------

7
<PAGE>

A Detailed Look at PreservationPlus

The Crediting Rate:

. Is a significant component of the Fund's yield.

We employ the following policies to attempt to reduce the risks involved in
using Wrapper Agreements:

. We purchase Wrapper Agreements from multiple issuers, each of which has
received a high quality rating from Moody's or Standard & Poor's.

. We monitor, on a continual basis, the financial well being of the issuers of
the securities in which the Fund invests and the Wrapper Providers providing
Wrapper Agreements to the Fund.

Derivative Instruments. The Fund may invest in various instruments commonly
known as "derivatives" to increase its exposure to certain groups of
securities. The derivatives that the Fund may use include futures contracts,
options on futures contracts and forward contracts. The Fund may use
derivatives to keep cash on hand to meet shareholder redemptions, as a hedging
strategy to maintain a specific portfolio duration, or to protect against
market risk.
- --------------------------------------------------------------------------------

A high quality rating means a security is rated within the top two long-term
ratings categories by a nationally recognized statistical rating organization.

INVESTMENT PROCESS

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

8
<PAGE>

A Detailed Look at PreservationPlus

RISKS

Credit Risk. An investor purchasing a fixed income security faces the risk that
the value of the security may decline because the creditworthiness of the
issuer may decline or the issuer may fail to make timely payment of interest or
principal.

Wrapper Agreement Risk. Although the Fund uses Wrapper Agreements to attempt to
maintain a stable value per share, there are risks associated with the use of
Wrapper Agreements, including:

. A Wrapper Provider could default, which could cause the Fund's share value to
fluctuate and could result in losses for plan participants who sell their
shares.

. The Wrapper Agreements generally do not protect the Fund from loss caused by
a fixed income security issuer's default on principal or interest payments.

. The Fund may not be able to obtain Wrapper Agreements to cover all of its
assets.

. If a Wrapper Provider is unable to make timely payments, the Fund's Board may
determine the fair value of that Wrapper Agreement to be less than the
difference between the book value and the market value, which could cause the
Fund's net asset value to fluctuate.

. Compared to investing in a traditional fixed income fund, the Fund trades the
potential for capital appreciation and some yield for protection from a
decline in the value of its holdings caused by changes in interest rates.

Security Selection Risk. While the Fund invests in short- to intermediate-term
securities, which by nature are relatively stable investments, the risk remains
that the securities we have selected will not perform as expected. This could
cause the Fund's returns to lag behind those of money market funds.

Liquidity Risk. Liquidity risk is the risk that a security cannot be sold
quickly at a price that reflects our estimate of its value. Because there is no
active trading market for Wrapper Agreements, the Fund's investments in the
Wrapper Agreements are considered illiquid. In an effort to minimize this risk,
the Fund limits its investments in illiquid securities, including Wrapper
Agreements, to 15% of net assets.

Pricing Risk. When price quotations for securities are not readily available,
we determine their value by the method that most accurately reflects their
current worth in the judgment of the Board of Trustees. If Wrapper Agreements
are not in place, this procedure implies an unavoidable risk, the risk that our
prices are higher or lower than the prices that the securities might actually
command if we sold them. If we have valued the securities too highly, you may
end up paying too much for Fund shares when you buy. If we underestimate their
price, you may not receive the full market value for your Fund shares when you
sell.

According to the procedures adopted by the Board of Trustees, the fair value of
the Wrapper Agreements generally will equal the difference between the book
value and the market value (plus accrued interest) of the Fund's assets. In
determining fair value, the Board will consider the creditworthiness and
ability of a Wrapper Provider to pay amounts due under the Wrapper Agreements.
If the Board of Trustees determines that a Wrapper Agreement should not be
valued this way, the net asset value of the Fund could fluctuate.

Derivative Risk. Derivatives are more volatile and less liquid than traditional
fixed income securities. Risks associated with derivatives include:

. the derivative may not fully offset the underlying positions;

. the derivatives used for risk management may not have the intended effects
and may result in losses or missed opportunities; and

. the possibility the Fund cannot sell the derivative because of an illiquid
secondary market.
- --------------------------------------------------------------------------------

9
<PAGE>

A Detailed Look at PreservationPlus

MANAGEMENT OF THE FUND

Board of Trustees. The Fund's shareholders, voting in proportion to the number
of shares each owns, elect a Board of Trustees, and the Trustees supervise all
of the Fund's activities on their behalf.

Investment Adviser. Under the supervision of the Board of Trustees, Bankers
Trust Company, with headquarters at 130 Liberty Street, New York, NY 10006,
acts as the Fund's investment adviser. Bankers Trust is an indirect wholly-
owned subsidiary of Deutsche Bank A.G. As investment adviser, Bankers Trust
makes the Fund's investment decisions. It buys and sells securities for the
Fund and conducts the research that leads to the purchase and sale decisions.
The investment adviser received a fee of 0.35% of the Fund's average daily net
assets for its services in the last fiscal year.

As of September 30, 1999, Bankers Trust had total assets under management of
approximately $285 billion. Bankers Trust is dedicated to servicing the needs
of corporations, governments, financial institutions, and private clients and
has invested retirement assets on behalf of the nation's largest corporations
and institutions for more than 50 years. The scope of the firm's capability is
broad: it is a leader in both the active and passive quantitative investment
disciplines and maintains a major presence in stock and bond markets worldwide.
As of December 31, 1999, Bankers Trust managed approximately $15 billion in
stable value assets.

At a special meeting of shareholders held in 1999, shareholders of the Fund
approved a new investment advisory agreement with Deutsche Asset Management,
Inc. (formerly Morgan Grenfell Inc.). The new investment advisory agreement may
be implemented within two years of the date of the special meeting upon
approval of a majority of the members of the Board of Trustees who are not
"interested persons," generally referred to as independent trustees.
Shareholders of the Fund also approved a new sub-investment advisory agreement
among the Trust, Deutsche Asset Management, Inc. and Bankers Trust under which
Bankers Trust may perform certain of Deutsche Asset Management, Inc.'s
responsibilities, at Deutsche Asset Management, Inc.'s expense, upon approval
of the independent trustees, within two years of the date of the special
meeting. Under the new investment advisory agreement and new sub-advisory
agreement, the compensation paid and the services provided would be the same as
those under the existing advisory agreement with Bankers Trust.

Deutsche Asset Management, Inc. is located at 885 Third Avenue, 32nd Floor, New
York, New York 10022. The firm provides a full range of investment advisory
services to institutional clients. It serves as investment adviser to 11 other
investment companies and as sub-adviser to five other investment companies.

As a result of the plea, absent an order from the SEC, Bankers Trust would not
be able to continue to provide investment advisory services to the Fund. The
SEC has granted a temporary order to permit Bankers Trust and its affiliates to
continue to provide investment advisory services to registered investment
companies. There is no assurance that the SEC will grant a permanent order.

Portfolio Managers. The following portfolio managers are responsible for the
day-to-day management of the master portfolio's investments:

Eric Kirsch, CFA

. Portfolio Manager of the master portfolio since its inception.

. Joined the investment adviser in 1980.

. Head of the Stable Value investment group.

Louis R. D'Arienzo

. Portfolio Manager of the fixed income portion of the master portfolio since
its inception.

. Joined the investment adviser in 1981.

. Portfolio Manager in the Structured Fixed Income investment group.

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

10
<PAGE>

A Detailed Look at PreservationPlus

John D. Axtell

. Portfolio Manager of the Wrapper Agreements in the master portfolio since its
inception.

. Joined the investment adviser in 1990.

. Portfolio Manager in the Stable Value investment group.

. keeping accurate, up-to-date records for your individual Fund account;

. implementing any changes you wish to make in your account information;

. processing your requests for cash dividends and distributions from the Fund;

. answering your questions on the Fund's investment performance or
administration;

. sending proxy reports and updated prospectus information to you; and

. collecting your executed proxies.

Service agents include brokers, financial advisors or any other bank, dealer or
other institution that has a sub-shareholder servicing agreement with Bankers
Trust. Service agents may charge additional fees to investors only for those
services not otherwise included in the Bankers Trust servicing agreement, such
as cash management, or special trust or retirement-investment reporting.

CALCULATING THE FUND'S SHARE PRICE

According to the procedures adopted by the Board of Trustees, the fair value of
the Wrapper Agreements generally will equal the difference between the book
value and the market value (plus accrued interest) of the Fund's assets. In
determining fair value, the Board will consider the creditworthiness and
ability of a Wrapper Provider to pay amounts due under the Wrapper Agreements.

DIVIDENDS AND DISTRIBUTIONS

On occasion, the dividends the Fund distributes may differ from the income the
Fund earns. When the Fund's income exceeds the amount distributed to
shareholders, the Fund may make an additional distribution. When an additional
distribution is necessary, the Board of Trustees may declare a reverse stock
split to occur at the same time the additional distribution is made. Making the
additional distribution simultaneously with the reverse stock split will
minimize fluctuations in the net asset value of the Fund's shares.

We automatically reinvest all dividends and capital gains, if any, unless you
elect to receive your distributions in cash.
- --------------------------------------------------------------------------------

The Exchange is open every week, Monday through Friday, except when the
following holidays are celebrated: New Year's Day, Martin Luther King, Jr. Day
(the third Monday in January), Presidents' Day (the third Monday in February),
Good Friday, Memorial Day (the last Monday in May), Independence Day (July
4th), Labor Day (the first Monday in September), Thanksgiving Day (the fourth
Thursday in November) and Christmas Day.
A reverse stock split reduces the number of total shares the Fund has
outstanding. The market value of the shares will be the same after the stock
split as before the split, but each share will be worth more.
- --------------------------------------------------------------------------------

11
<PAGE>

A Detailed Look at PreservationPlus

TAX CONSIDERATIONS

BUYING AND SELLING FUND SHARES

The Fund does not sell its shares directly to the public. The Fund offers
shares only to certain participant-directed employee benefit plans. The shares
are available to employees benefit plans whose initial investment equals or
exceeds $25 million. Shares are also available to employee benefit plans which
invest in the Fund through an omnibus account or similar arrangement, if that
omnibus account or similar arrangement makes an initial investment in the Fund
of at least $25 million. These benefit plans may own the Fund's shares: 1)
directly or 2) indirectly through other investment vehicles such as an
insurance company separate account or bank collective funds, which offer the
Fund as an investment option to its participants.

Benefit plans investing in the Fund must limit their participants' ability to
direct a withdrawal from the Fund to the following circumstances:

. upon the plan participant's death, retirement, disability or termination;

. to fund plan participant loans and other "in service" withdrawals made
pursuant to the terms of the plan; and

How To Receive Account Information

. If you are a plan participant, you should contact your plan administrator or
the organization that provides record-keeping services for information about
your account.

. If you are a plan administrator or fiduciary, you should call 1-800-677-7596
for information about the plan's account with the Fund.

Transactions in Fund Shares

Important Information About Buying and Selling Shares

. After receiving a plan's order, the Fund buys or sells shares at the next
price calculated on any day the Fund is open for business.

. Unless otherwise instructed, the Fund normally makes payment of the proceeds
from the sale of plan shares the next business day but always within seven
days.

. The redemption fee does not apply to exchanges into another class of shares
of the Fund, into another investment company or other entity that invests
exclusively in the master portfolio.

. The Fund does not issue share certificates.

. The Fund may request additional information about the plan when an order to
redeem 5% or more of a plan's assets is received.

. Sales orders not directed by plan participants and received on less than
twelve months prior written notice are subject to a 2% redemption fee.

. We reserve the right to reject purchases of Fund shares (including
exchanges) for any reason. We will reject purchases if we conclude that the
purchaser may be investing only for the short-term.

. We reserve the right to reject purchases of Fund shares (including
exchanges) or to suspend or postpone redemptions at times when both the New
York Stock Exchange and the Fund's custodian are closed.
- -------------------------------------------------------------------------------

12
<PAGE>

A Detailed Look at PreservationPlus

The table below provides a picture of the Institutional Class' financial
performance since its inception. The information selected reflects financial
results for a single Fund share. The total returns in the table represent the
rate of return that an investor would have earned on an investment in the Fund
(assuming reinvestment of all dividends and distributions). This information
has been audited by Ernst & Young LLP whose report, along with the Fund's
financial statements, is included in the Fund's annual report. The annual
report is available free of charge by calling the Service Center at 1-800-677-
7596.

Financial Highlights

<TABLE>
<CAPTION>
For the year For the period
ended December 14, 1997/1/ through
September 30, 1999 September 30, 1998
<S> <C> <C>
Per share operating
performance:
Net asset value, beginning
of period $ 10.00 $ 10.00
-----------------------------------------------------------------------------
Income from investment
operations
Net investment income 0.55 0.46
-----------------------------------------------------------------------------
Distributions to
shareholders
Net investment income (0.55) (0.46)
-----------------------------------------------------------------------------
Net realized gains/3/ (0.05) --
-----------------------------------------------------------------------------
Reverse stock split/3/ 0.05 --
-----------------------------------------------------------------------------
Net asset value, end of
period $ 10.00 $ 10.00
-----------------------------------------------------------------------------
Total investment return 5.66% 5.91%/2/
-----------------------------------------------------------------------------
Supplemental data and
ratios:
Net assets, end of period
(000s omitted) $186,563 $162,193
-----------------------------------------------------------------------------
Ratios to average net
assets:
Net investment income 5.53% 5.79%/2/
-----------------------------------------------------------------------------
Net expenses, including
expenses of the
PreservationPlus Portfolio 0.40% 0.40%/2/
-----------------------------------------------------------------------------
Decrease reflected in above
expense ratio due to fees
waived/expenses reimbursed
by Bankers Trust 0.26% 0.50%/2/
-----------------------------------------------------------------------------
Portfolio turnover rate/4/ 291% 428%/5/
-----------------------------------------------------------------------------
</TABLE>

/1/Commencement of operations.

/2/Annualized.

/3/In order to comply with requirements of the Internal Revenue Code applica-
ble to regulated investment companies, the Fund is required to distribute ac-
cumulated net realized gains, if any, on a annual basis. When such distribu-
tions are made, the immediate impact is a corresponding reduction in the net
asset value per share of each class of the Fund. Given the objective of the
Fund to maintain a stable net asset value of $10 per share, the Fund intends
to declare a reverse stock split immediately subsequent to any such distribu-
tions at a rate that will cause the total number of shares held by each share-
holder, including shares acquired on reinvestment of that distribution, to re-
main the same as before the distribution was paid and in effect reinstate a
net asset value of $10 per share.

On December 4, 1998, the Fund declared a capital gain distribution of $0.05
per share and a corresponding reverse stock split of .995 per share. There was
no effect on the value of the total holdings of each shareholder (assuming re-
investment of such distributions) as a result of this activity.

/4/The portfolio turnover rate is the rate for the master portfolio, into
which the Fund invests its assets.

/5/For the period October 1, 1997 to September 30, 1998.
- --------------------------------------------------------------------------------

13
<PAGE>

This page intentionally left blank
<PAGE>

Service Center
P.O. Box 219210
Kansas City, MO 64121-9210
Or call our toll-free number: 1-800-677-7596

PreservationPlus
BT Pyramid Mutual Funds

Distributed by:
ICC Distributors, Inc. CUSIP
Two Portland Square #055847818
Portland, ME 04101 491PRO (1/00)
811-6576
<PAGE>

Deutsche Asset Management

Mutual Fund

Prospectus
January 31, 2000
Institutional Class
PreservationPlus
formerly BT PreservationPlus Fund -- Institutional Service Class

The Fund is designed exclusively for participant-directed employee benefit
plans.

[Like shares of all mutual funds, these securities have
not been approved or disapproved by the Securities
and Exchange Commission nor has the Securities and Exchange Commission
passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.]

A Member of the
Deutsche Bank Group [/]
<PAGE>

Overview
- --------------------------------------------------------------------------------
of PreservationPlus

PreservationPlus

Overview of PreservationPlus

A Detailed Look at PreservationPlus

<TABLE>
<S> <C>
Objective................................................................... 7
Strategy.................................................................... 7
Principal Investments....................................................... 7
Investment Process.......................................................... 8
Risks....................................................................... 9
Management of the Fund...................................................... 10
Calculating the Fund's Share Price.......................................... 11
Dividends and Distributions................................................. 12
Tax Considerations.......................................................... 12
Buying and Selling Fund Shares.............................................. 12
Financial Highlights........................................................ 14
</TABLE>
- --------------------------------------------------------------------------------

3
<PAGE>

Overview of PreservationPlus

PRINCIPAL RISKS OF INVESTING IN THE FUND

Although the Fund seeks to preserve a stable share value, there are risks
associated with fixed income investing. For example, the value of fixed income
securities could fluctuate or fall if:

The Fund attempts to offset these risks by purchasing Wrapper Agreements. The
use of Wrapper Agreements has its own risks, including:

. The possibility of default by a financial institution providing a Wrapper
Agreement ("Wrapper Provider").
. The inability of the Fund to obtain Wrapper Agreements covering the Fund's
assets.

The Fund is also subject to the risk that we incorrectly judge the potential
risks and rewards of investing in derivatives.

WHO SHOULD CONSIDER INVESTING IN THE FUND

While the Fund continues to offer other classes of shares, effective October
18, 1999, the Institutional Service Class of PreservationPlus ceased
establishing new accounts. The Fund offers two other classes--Investment Class
and Institutional Class--that are open to new shareholders. There are different
fees associated with investing in the Investment Class and the Institutional
Class. For a free copy of the prospectuses for the Investment Class and the
Institutional Class, please call 1-800-677-7596. Read the prospectus carefully
before investing.

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

4
<PAGE>

Overview of PreservationPlus

TOTAL RETURNS, AFTER FEES AND EXPENSES

The bar chart and table on this page can help you evaluate the potential risks
and rewards of investing in the Institutional Service Class shares of the Fund.
The bar chart shows the Institutional Service Class' actual return for each
full calendar year since it began selling those shares on April 1, 1998 (its
inception date). The table compares the Institutional Service Class' average
annual return with the Lehman 1-3 Year Government/Corporate Total Return Index,
the IBC First Tier Retail Money Market Universe, and the Wrapped Lehman
Intermediate Aggregate Index, over the last year and since the Fund's
inception. An index is a group of securities whose overall performance is used
as a standard to measure investment performance. It does not factor in the
costs of buying, selling and holding securities--costs that are reflected in
the Fund's results.

As of December 31, 1999, the Fund's 30-day yield was 5.58%.
- --------------------------------------------------------------------------------

Lehman 1-3 Year Government/Corporate Total Return Index is a widely accepted
benchmark of short-term fixed income securities. It is a total return index
consisting of all U.S. Government agency securities, U.S. Government Treasury
securities and all investment grade corporate debt securities with maturities
of one to three years. The Wrapped Lehman Intermediate Aggregate Index is a
custom benchmark representing investment in a portfolio consisting of the
Lehman Intermediate Aggregate Index and a book value wrapper agreement, at an
assumed expense level of 0.15%. The Wrapped Lehman Index more closely reflects
the market sector in which the Fund invests than the other Lehman index.

Year-by-Year Returns
(the full calendar year since inception)

[CHART]

Since inception, the Institutional Service Class' highest return in any
calendar quarter was 1.44% (second quarter 1998) and its lowest quarterly
return was 1.32% (second quarter 1999). Past performance offers no indication
of how the Fund will perform in the future.

PERFORMANCE FOR THE PERIOD ENDED 12/31/99
<TABLE>
<CAPTION>
Average Annual Returns
1 year Since
Inception
(April 1,
1998)
<S> <C> <C>
PreservationPlus--
Institutional Service
Class 5.50% 5.59%
-----------------------------------------------------
Lehman 1-3 Year
Government/Corporate
Total
Return Index/1/ 3.15% 4.92%
-----------------------------------------------------
IBC First Tier Retail
Money Market
Universe/2/ 4.58% 4.72%
-----------------------------------------------------
Wrapped Lehman
Intermediate Aggregate
Index 6.01% 6.07%
-----------------------------------------------------
</TABLE>

/1/The Lehman 1-3 Year
Government/Corporate Total Return In-
dex and IBC First Tier Retail Money
Market Universe Average are calcu-
lated from March 31, 1998.

/2/Unweighted average return, net of
fees and expenses, of all money mar-
ket mutual funds that invested in
non-Government securities, that are
restricted to those money market in-
struments rated first tier (the top
rating) by two or more nationally
recognized statistical rating organi-
zations.
- --------------------------------------------------------------------------------

5
<PAGE>

Overview of PreservationPlus

ANNUAL FUND OPERATING EXPENSES

The Shareholder Fees and Annual Fees and Expenses tables to the right describe
the fees and expenses that you may pay if you buy and hold shares of
PreservationPlus--Institutional Service Class.

Institutional Service Class shares are subject to shareholder servicing fees in
the maximum amount of 0.15% of the average daily net assets of the shares. The
shareholder services provided in exchange for these fees may include
establishing and maintaining shareholder and plan participant accounts,
processing purchase and redemption transactions, arranging for bank wires,
performing shareholder sub-accounting, answering investor/shareholder's
inquiries regarding the Fund and/or its classes, providing periodic statements
showing the investor/shareholder's account balance and those of plan
participants, transmitting proxy statements, periodic reports, updated
prospectuses and other communications to shareholders and, with respect to
meetings of shareholders, collecting, tabulating and forwarding to the Trust
executed proxies and obtaining such other information and performing such other
services as may reasonably be required.

SHAREHOLDER FEES
(fees paid directly from your investment)

ANNUAL FEES AND EXPENSES
(expenses paid from Fund assets)

<TABLE>
<CAPTION>
Percentage of Average
Daily Net Assets/1/
<S> <C>
Management Fees 0.35%
----------------------------------------------
Distribution and
Service (12b-1)
Fees None
----------------------------------------------
Other Fund
Operating Expenses 0.48%/2/
----------------------------------------------
Total Fund
Operating Expenses 0.83%
----------------------------------------------
Less: Fee Waivers
or Expense
Reimbursements 0.28%/3/
----------------------------------------------
Net Expenses 0.55%
----------------------------------------------
</TABLE>

Expense Example/4/

<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C>
$56 $234 $439 $1,030
- -----------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
/1/Information on the annual operating expenses reflects the expenses of both
the Fund and the PreservationPlus Portfolio, the master portfolio into which
PreservationPlus invests all of its assets. (A further discussion of the
relationship between the Fund and the master portfolio appears in the
"Organizational Structure" section of this prospectus.)

/2/"Other Expenses" include the annual premium rate the Fund paid for Wrapper
Agreements and a shareholder servicing fee of 0.15%.

/4/For the first 16 months, the expense example takes into account fee waivers
and reimbursements.
- --------------------------------------------------------------------------------

6
<PAGE>

A detailed look
- --------------------------------------------------------------------------------
at PreservationPlus

OBJECTIVE

PreservationPlus seeks a high level of current income while seeking to maintain
a stable value per share.

STRATEGY

PRINCIPAL INVESTMENTS

Fixed Income Securities. The Fund invests at least 65% of its net assets in
fixed income securities including:

. U.S. government securities that are issued or guaranteed by the U.S.
Treasury, or by agencies or instrumentalities of the U.S. Government.

. U.S. dollar-denominated securities issued by domestic or foreign
corporations, foreign governments or supranational entities.

. U.S. dollar-denominated asset-backed securities issued by domestic or foreign
entities.

. Mortgage pass-through securities issued by governmental and non-governmental
issuers.

. Collateralized mortgage obligations and real estate mortgage investment
conduits.

. Obligations issued or guaranteed, or backed by securities issued or
guaranteed, by the U.S. government, or any of its agencies or
instrumentalities, including CATS, TIGRs, TRs

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

and zero coupon securities, which are securities consisting of either the
principal component or the interest component of a U.S. Treasury bond.

We employ the following policies to attempt to reduce the risks involved in
investing in fixed income securities:

. We allocate assets among a diversified group of issuers.

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

Maturity measures the time remaining until an issuer must repay a bond's
principal in full.

7
<PAGE>

A Detailed Look at PreservationPlus

The Crediting Rate:

. Is a significant component of the Fund's yield.

We employ the following policies to attempt to reduce the risks involved in
using Wrapper Agreements:

. We purchase Wrapper Agreements from multiple issuers, each of which has
received a high quality rating from Moody's or Standard & Poor's.
. We monitor, on a continual basis, the financial well being of the issuers of
the securities in which the Fund invests and the Wrapper Providers providing
Wrapper Agreements to the Fund.

Derivative Instruments. The Fund may invest in various instruments commonly
known as "derivatives" to increase its exposure to certain groups of
securities. The derivatives that the Fund may use include futures contracts,
options on futures contracts and forward contracts. The Fund may use
derivatives to keep cash on hand to meet shareholder redemptions, as a hedging
strategy to maintain a specific portfolio duration, or to protect against
market risk.

- --------------------------------------------------------------------------------
A high quality rating means a security is rated within the top two long-term
ratings categories by a nationally recognized statistical rating organization.

INVESTMENT PROCESS

8
<PAGE>

A Detailed Look at PreservationPlus

RISKS

Primary Risks

Wrapper Agreement Risk. Although the Fund uses Wrapper Agreements to attempt
to maintain a stable value per share, there are risks associated with the use
of Wrapper Agreements, including:

. A Wrapper Provider could default, which could cause the Fund's share value
to fluctuate or fall and could result in losses for plan participants who
sell their shares.

. The Wrapper Agreements generally do not protect the Fund from loss caused by
a fixed income security issuer's default on principal or interest payments.

. The Fund may not be able to obtain Wrapper Agreements to cover all of its
assets.

Pricing Risk. When price quotations for securities are not readily available,
we determine their value by the method that most accurately reflects their
current worth in the judgment of the Board of Trustees. If Wrapper Agreements
are not in place, this procedure implies an unavoidable risk, the risk that
our prices are higher or lower than the prices that the securities might
actually command if we sold them. If we have valued the securities too highly,
you may end up paying too much for Fund shares when you buy. If we
underestimate their price, you may not receive the full market value for your
Fund shares when you sell.

Derivative Risk. Derivatives are more volatile and less liquid than
traditional fixed income securities. Risks associated with derivatives
include:

. the derivative may not fully offset the underlying positions;
- -------------------------------------------------------------------------------

9
<PAGE>

A Detailed Look at PreservationPlus

. the derivatives used for risk management may not have the intended effects
and may result in losses or missed opportunities; and

. the possibility the Fund cannot sell the derivative because of an illiquid
secondary market.

MANAGEMENT OF THE FUND

Deutsche Asset Management is the marketing name for the asset management
activities of Deutsche Bank A.G., Deutsche Funds Management, Bankers Trust
Company, DB Alex Brown LLC, Deutsche Asset Management, Inc., and Deutsche Asset
Management Investment Services Limited.