July 31, 1996
DREYFUS ASSET ALLOCATION FUND, INC.
DREYFUS TOTAL RETURN PORTFOLIO
SUPPLEMENT TO PROSPECTUS
DATED SEPTEMBER 1, 1995
THE FOLLOWING INFORMATION SUPERCEDES AND REPLACES ANY CONTRARY
INFORMATION CONTAINED IN THE FUND'S PROSPECTUS IN THE SECTION ENTITLED
"MANAGEMENT POLICIES."
The following table sets forth the asset classes, benchmark
percentages and asset class strategy ranges within which The Dreyfus
Corporation intends to manage the Dreyfus Total Return Porfolio's assets:
ASSET BENCHMARK STRATEGY
CLASS PERCENTAGE RANGE
- ------ ------------- ---------
Equity Securities 55% 40-80%
Fixed-Income Securities 35% 20-60%
Short-Term Money Market Instruments 10% 0-40%
"Benchmark percentage" represents the asset mix The Dreyfus
Corporation would expect to maintain when its assessment of
economic conditions and investment opportunities indicate that the financial
markets are fairly valued relative to each other. The asset class "strategy
range" indicates ordinarily expected variations from this benchmark and
reflects the fact that The Dreyfus Corporation expects to make policy weight
shifts within specific asset classes.
The equity securities in which the Portfolio may invest include,
common stocks, preferred stocks and convertible securities of domestic and
foreign issuers. The Portfolio is particularly alert to companies, both
domestic and foreign, which it considers undervalued by the stock market in
terms of current earnings, assets or overall growth prospects. The Portfolio
may invest up to 25% of the value of its total assets in equity securities of
foreign companies which are not publicly traded in the United States.
The fixed-income securities in which the Portfolio may invest include
U.S. dollar-denominated bonds, debentures, notes, mortgage-related
securities, asset-backed securities, municipal obligations, warrants,
convertible debt obligations and convertible preferred stocks. The issuers of
these obligations may include domestic and foreign corporations, partnerships
or trusts, and governments, their political subdivisions, agencies or
municipalities, and corporations. The Porfolio may invest up to 30% of its
total assets in fixed-income securities of foreign issuers, including
securities of issuers whose principal activities are in, or which are
governments of, emerging markets. The Portfolio is not subject to any limit
on the percentage of its assets that may be invested in fixed-income
securities having a certain rating. Thus, it is possible that a substantial
portion of the Portfolio's assets may be invested in fixed-income securities
that are unrated or rated in the lowest categories of the recognized rating
services (i.e., securities rated C by Moody's Investors Service, Inc.
("Moody's") or D by Standard & Poor's Ratings Group, a division of The
McGraw-Hill Companies, Inc. ("S&P"), Fitch Investors Service, L.P. ("Fitch")
or Duff & Phelps Credit Rating Co. ("Duff")). Low-rated and unrated
securities have special risks relating to the ability of the Portfolio to
receive timely, or perhaps ultimate, payment
(CONTINUED ON REVERSE SIDE)
of principal and interest. They are considered to have speculative
characteristics and to be of poor quality; some obligations in which the
Portfolio may invest, such as debt securities rated D by S&P, Fitch and Duff,
may be in default. The Portfolio intends to invest less than 35% of its assets
in debt securities rated Ba or lower by Moody's and BB or lower by S&P, Fitch
and Duff.
The money market instruments in which the Portfolio may invest are
described in the Prospectus
THE FOLLOWING INFORMATION SUPPLEMENTS OR REPLACES THE INFORMATION
CONTAINED IN THE SECTIONS OF THE FUND'S PROSPECTUS ENTITLED "MANAGEMENT OF
THE FUND," "HOW TO BUY FUND SHARES," "SHAREHOLDER SERVICES," AND "HOW TO
REDEEM FUND SHARES":
Dreyfus Transfer, Inc., a wholly-owned subsidiary of The Dreyfus
Corporation, is located at One American Express Plaza, Providence, Rhode
Island 02903, and serves as the Fund's Transfer and Dividend Disbursing Agent
(the "Transfer Agent").
Effective January 1, 1996, the telephone number for the following
transactions is 1-800-645-6561 or, if you are calling from overseas,
516-794-5452:
* Dreyfus TELETRANSFER Privilege
* Telephone Exchange Privilege
* Wire Redemption Privilege
* Telephone Redemption Privilege
THE FOLLOWING INFORMATION SUPERSEDES AND REPLACES ANY CONTRARY
INFORMATION CONTAINED IN THE FUND'S PROSPECTUS IN THE SECTION ENTITLED
"MANAGEMENT OF THE FUND."
Effective February 1, 1996, the primary portfolio manager of Dreyfus
Total Return Portfolio, Dreyfus Income Portfolio and Dreyfus Growth Portfolio
is Timothy M. Ghriskey. Mr. Ghriskey has been employed by The Dreyfus
Corporation since July 1995. Prior thereto, he was a Vice President and
Associate Managing Partner at Loomis, Sayles & Co. since 1985.
550/s073196
