MORGAN GRENFELL INVESTMENT TRUST, 485BPOS, 1999-03-01

MORGAN GRENFELL INVESTMENT TRUST
485BPOS, 1999-03-01

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<PAGE>

As filed with the Securities and Exchange Commission on March 1, 1999

1933 Act Registration No. 33-68704
1949 Act Registration No. 811-8006

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /

Pre-Effective Amendment No. __ / /

Post-Effective Amendment No. 21 /x/

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 / /

Amendment No. 23 /x/

(Check appropriate box or boxes)

MORGAN GRENFELL INVESTMENT TRUST
(Exact name of registrant as specified in Charter)
885 Third Avenue
New York, New York 10022
(Address of Principal Executive Offices)

REGISTRANT'S TELEPHONE NUMBER.
including Area Code: 212-230-2600

Copy to:

James E. Minnick Ernest V. Klein, Esq.
Morgan Grenfell Inc. Hale and Dorr
885 Third Avenue Sixty State Street
New York, New York 10022 Boston, Massachusetts 02109
(Name and Address of Agent for Service)

It is proposed that this filing will become effective:

X March 1, 1999 pursuant to paragraph (b) of Rule 485
- --

Title of Securities Being Registered: Shares of Beneficial Interest.

<PAGE>

MORGAN GRENFELL
INVESTMENT TRUST

Prospectus March 1, 1999

International Mutual Funds
Institutional Shares

The Securities and Exchange Commission has not approved any fund's shares as
an investment or determined whether this prospectus is accurate or complete.
Any statement to the contrary is a crime.

<PAGE>
MORGAN GRENFELL
INVESTMENT TRUST
INSTITUTIONAL SHARES

CONTENTS

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

<TABLE>
<CAPTION>
INVESTING IN MORGAN GRENFELL INTERNATIONAL
MUTUAL FUNDS

<S> <C> <C>
FUND DESCRIPTIONS
GENERAL
Who May Want to Invest...................... 1
INTERNATIONAL EQUITY FUNDS
International Select Equity................. 2
Global Equity............................... 4
European Equity Growth...................... 6
New Asia.................................... 8
International Small Cap Equity.............. 10
Japanese Small Cap Equity................... 12
European Small Cap Equity................... 14
Emerging Markets Equity..................... 16
A FUND BY FUND LOOK AT INVESTMENT OBJECTIVES AND
STRATEGIES, RISKS AND EXPENSES.
INTERNATIONAL FIXED INCOME FUNDS
Core Global Fixed Income.................... 18
Global Fixed Income......................... 20
International Fixed Income.................. 22
Emerging Markets Debt....................... 24
Emerging Local Currency Debt................ 26

MORE ABOUT RISK............................... 28

AN OVERVIEW OF SECURITIES THAT MAY BE PURCHASED
AND INVESTMENT TECHNIQUES THAT MAY BE USED BY THE
FUNDS AND THEIR RISKS. INVESTMENT ADVISER
Portfolio Management........................ 30

MANAGING YOUR INVESTMENT
BUYING AND SELLING SHARES
Through a Plan.............................. 31
Through a Broker............................ 31
Directly.................................... 31
How Shares are Priced....................... 32
Payment of Redemption Proceeds.............. 32
HOLDING SHARES
Exchanging Shares........................... 33
Dividends and Distributions................. 33
Tax Considerations.......................... 33
FINANCIAL HIGHLIGHTS.......................... 34
POLICIES AND INSTRUCTIONS FOR OPENING, MAINTAINING
AND CLOSING AN ACCOUNT IN ANY FUND.
</TABLE>

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

Prospectus - International Mutual Funds
<PAGE>

Fund Descriptions

WITH MORE THAN $150 BILLION IN ASSETS UNDER MANAGEMENT,
INCLUDING $29 BILLION MANAGED FOR NORTH AMERICAN CLIENTS,
MORGAN GRENFELL ASSET MANAGEMENT IS ONE OF THE WORLD'S
FOREMOST INVESTMENT MANAGEMENT ORGANIZATIONS. WE COVER ALL
MAJOR INVESTMENT REGIONS, LEVERAGING THE EXPERTISE OF 250
PORTFOLIO MANAGERS AND ANALYSTS ACROSS THE GLOBE.

WHO MAY WANT TO INVEST
- --------------------------------------------------------------------------------

WHO MAY WANT TO INVEST IN THE EQUITY FUNDS:

- - those who are pursuing a long-term goal
- - those who are seeking an investment with the potential to outpace inflation
- - those who are seeking to diversify their portfolio through international
investing

WHO MAY NOT WANT TO INVEST IN THE EQUITY FUNDS:

- - those who are pursuing a short-term goal or are investing their emergency
funds
- - those who require regular income or stability of principal
- - those who do not feel comfortable with the higher price volatility and
currency fluctuations associated with investments in international securities

WHO MAY WANT TO INVEST IN THE FIXED INCOME FUNDS:

- - those who are investing for income
- - those who want higher potential returns than a money market fund
- - those who are seeking to diversify their personal investment portfolio
through international investing

WHO MAY NOT WANT TO INVEST IN THE FIXED INCOME FUNDS:

- - those who are investing their sole source of investment income
- - those who are making short-term investments
- - those who do not feel comfortable with the higher price volatility and
currency fluctuations associated with investments in international securities

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

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

1 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SELECT EQUITY FUND

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

(FORMERLY INTERNATIONAL EQUITY FUND)

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of foreign issuers.

The portfolio management team generally uses a "bottom-up" approach to picking
stocks. This approach focuses on individual stock selection rather than country
selection. The team uses an active process which emphasizes fundamental company
research through financial analysis and company visits. The team also uses a
risk-controlled asset allocation process to add value at the regional level.

The portfolio will consist of a focused list of 30 to 40 international stocks
offering the greatest upside potential on a 12 month view. The fund seeks
companies with above average earnings growth, below average price-to-earnings
ratios, leading or dominant positions in their particular markets and high
quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of foreign companies. Up to 35% of the
fund's total assets may include cash equivalents, investment grade fixed income
securities (rated in one of the four highest categories by one of the major
independent rating agencies, or in unrated securities that the adviser considers
of comparable quality), and equity and equity related securities of U.S.
issuers. The fund may invest more than 25% of its assets in securities of
companies located in each of Japan and the United Kingdom.

The fund may use derivatives, including futures, options and foreign currency
transactions to lessen its exposure to changing currency exchange rates,
security prices, interest rates and other factors that affect security values.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

STOCK MARKET RISK. The value of your investment will fluctuate in response to
stock market movements. An adverse event, such as an unfavorable earnings
report, may depress the value of a particular company's stock. The fund
typically invests in between 30 to 40 companies. Thus, an adverse event
affecting a particular company may hurt the fund's performance more than if it
had invested in a larger number of companies.

RISKS OF HEDGING, RISK MANAGEMENT AND COUNTERPARTY RISK. Derivatives used for
hedging may not fully offset the underlying positions. Derivatives used for risk
management may not have the intended effects and may result in losses or missed
opportunities. In addition, there is a risk that a counterparty will fail to
honor a contract's terms resulting in a loss for the fund.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

2 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SELECT EQUITY FUND (CONTINUED)

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

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
Morgan Stanley MSCI EAFE Index. How the fund has performed in the past is not
necessarily an indication of how the fund will perform in the future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/96 10.31%
Dec/31/97 0.51%
Dec/31/98 23.49%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 22.48% in 4th quarter 1998
Lowest: -15.37% in 3rd quarter 1998

AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell International Select
Equity, Institutional Shares 23.49% 13.39%
Morgan Stanley MSCI EAFE Index 20.33% 9.56%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.70%
Shareholder Service Fee.................. None
Other Expenses........................... 2.19%
Total Annual Fund Operating Expenses..... 2.89%
</TABLE>

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

* WE PLACE A LIMITATION ON THE FUND'S OPERATING EXPENSES AND REIMBURSE THE FUND
FOR ANY EXPENSES INCURRED IN ADDITION TO THE LIMITATION. THIS VOLUNTARY
REIMBURSEMENT POLICY MAY BE TERMINATED AT ANY TIME.

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 0.70%
Shareholder Service Fee.......................... None
Other Expenses................................... 2.19%
Reimbursements................................... -1.99%
Total Annual Fund Operating Expenses............. 0.90%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 292 $ 895 $ 1,523 $ 3,214
</TABLE>

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

3 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of companies located throughout the world.

The portfolio management team will generally use a "bottom-up" approach to
picking stocks. This approach will focus on individual stock selection rather
than country selection. The team will use an active process which will emphasize
fundamental company research through financial analysis and company visits. The
team will also use a risk-controlled asset allocation process to add value at
the regional level.

The team will seek companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of companies located throughout the
world. Up to 35% of the fund's total assets may include cash equivalents,
investment grade fixed income securities (rated in one of the four highest
categories by one of the major independent rating agencies, or in unrated
securities that the adviser considers of comparable quality) of issuers located
anywhere in the world. The fund may invest more than 25% of its assets in
securities of companies located in each of Japan, the United States and the
United Kingdom.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
focus its investments in Japan, the United States and the United Kingdom, it
could be particularly susceptible to the effects of political and economic
developments in these countries.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

4 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund. Since no shares were outstanding during the past year, other
expenses are based on estimated amounts for the current fiscal year.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly
from your investment)
(% of offering price)
Maximum Front-End Sales Charge......... None
Maximum Deferred Sales Charge.......... None

Annual Fund Operating Expenses*
(expenses that are deducted from fund
assets)
(% of average net assets)
Advisory Fees.......................... 0.70%
Shareholder Service Fee................ None
Other Expenses......................... 0.70%
Total Annual Fund Operating Expenses... 1.40%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees...................................... 0.70%
Shareholder Service Fee............................ None
Other Expenses..................................... 0.70%
Reimbursements..................................... -0.50%
Total Annual Fund Operating Expenses............... 0.90%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 143 $ 443
</TABLE>

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

5 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN EQUITY GROWTH FUND
- ----------------------------------------

(FORMERLY EUROPEAN EQUITY FUND)

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of companies located in Europe.

The team seeks companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its assets in the
equity and equity related securities of European companies. Up to 35% of the
fund's total assets may include cash equivalents, investment grade fixed income
securities (rated in one of the four highest categories by one of the major
independent rating agencies, or in unrated securities that the adviser considers
of comparable quality) and securities of non-European issuers (including the
U.S.). The fund may invest more than 25% of its assets in securities denominated
in the euro, as well as in companies located in the United Kingdom.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
concentrate its investments in euro denominated issues, as well as in the United
Kingdom, the fund could be particularly susceptible to the effects of political
and economic developments in these regions.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

6 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN EQUITY GROWTH FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
Morgan Stanley MSCI Europe Index. How the fund has performed in the past is not
necessarily an indication of how the fund will perform in the future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/97 15.54%
Dec/31/98 22.89%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 20.70% in 1st quarter 1998
Lowest: -16.78% in 3rd quarter 1998

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell European Equity Growth,
Institutional Shares 22.89% 23.48%
Morgan Stanley MSCI Europe Index 28.91% 28.75%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.70%
Shareholder Service Fee.................. None
Other Expenses........................... 0.43%
Total Annual Fund Operating Expenses..... 1.13%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 0.70%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.43%
Reimbursements................................... -0.23%
Total Annual Fund Operating Expenses............. 0.90%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 115 $ 359 $ 622 $ 1,375
</TABLE>

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

7 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

NEW ASIA FUND
- ----------------------------------------

(FORMERLY PACIFIC BASIN EQUITY FUND)

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in the equity securities of companies located in the Pacific Basin,
excluding Japan.

The portfolio management team will generally use a "bottom-up" approach to
picking stocks. This approach will focus on individual stock selection rather
than country selection. The team will use an active process which emphasizes
fundamental company research through financial analysis and company visits. The
team will also use a risk-controlled asset allocation process to add value at
the regional level.

The team will seek companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of companies located in the Asian
Pacific Basin, excluding Japan. Up to 35% of the fund's total assets may include
cash equivalents, investment grade fixed income securities (rated in one of the
four highest categories by one of the major independent rating agencies, or in
unrated securities that the adviser considers of comparable quality) and equity
and equity related securities of issuers located outside the Pacific Basin
(including the U.S. and Japan). The fund may invest more than 25% of its assets
in securities of companies located in Hong Kong.

The fund may use derivatives, including options, futures and foreign currency
transactions to lessen its exposure to changing currency exchange rates,
security prices, interest rates and other factors that affect security values.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund
focuses its investments in the Pacific Basin, and Hong Kong in particular, it
could be particularly susceptible to the effects of political and economic
developments in the Pacific Basin, especially Hong Kong.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

8 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

NEW ASIA FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.70%
Shareholder Service Fee.................. None
Other Expenses........................... 0.70%
Total Annual Fund Operating Expenses..... 1.40%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 0.70%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.70%
Reimbursements................................... -0.50%
Total Annual Fund Operating Expenses............. 0.90%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 143 $ 443
</TABLE>

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

9 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SMALL CAP EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of small capitalization companies located in
countries other than the United States.

The team seeks companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of small capitalization companies
located in countries other than the United States. Small capitalization
companies are: (i) companies ranked according to market capitalization in the
bottom 25% of issuers listed on a stock exchange, (ii) companies listed on a
secondary market and (iii) companies whose securities are not listed on a stock
exchange or secondary market. The fund will focus on companies located in
countries which make up the BT Alex Brown Euro Pacific Index. The fund, however,
may invest in stocks that are not constituents of the index. Up to 35% of the
fund's total assets may include cash equivalents, investment grade fixed income
securities (rated in one of the four highest categories by one of the major
independent rating agencies, or in unrated securities that the adviser considers
of comparable quality) and equity securities of large and medium capitalization
companies located outside the U.S. and companies of any size located in the U.S.
The fund may invest more than 25% of its assets in securities of small cap
companies located in each of Japan and the United Kingdom.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF SMALL CAP INVESTING. Small capitalization companies generally have
less potential for growth, a lower degree of liquidity in the market and a
greater sensitivity to changing economic conditions in their geographic regions
than larger capitalization companies.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

10 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SMALL CAP EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
BT Alex Brown Euro Pacific Small Cap Index. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 2.77%
Dec/31/96 1.86%
Dec/31/97 -14.33%
Dec/31/98 15.49%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 13.54% in 1st quarter 1998
Lowest: -12.55% in 3rd quarter 1998

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell International Small Cap
Equity, Institutional Shares 15.49% 0.05%
BT Alex Brown Euro Pacific Small Cap
Index 13.32% 2.68%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 1.00%
Shareholder Service Fee.................. None
Other Expenses........................... 0.49%
Total Annual Fund Operating Expenses..... 1.49%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... 1.00%
Shareholder Service Fee........................... None
Other Expenses.................................... 0.49%
Reimbursements.................................... -0.24%
Total Annual Fund Operating Expenses.............. 1.25%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 152 $ 471 $ 813 $ 1,779
</TABLE>

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

11 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

JAPANESE SMALL CAP EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of small capitalization companies located in
Japan.

The portfolio management team will use an active process which emphasizes
fundamental company research through financial analysis and company visits. The
team seeks well managed companies with above average growth prospects and
healthy cash flow generation potential. The investment style is best described
as "growth at a price," the aim being to build a portfolio of high quality
growth stocks at the most attractive valuations possible. The team will also use
a risk-controlled asset allocation process to add value at the regional level.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of small capitalization companies
located in Japan. Small capitalization companies are (i) companies ranked
according to market capitalization in the bottom 20% of issuers listed on the
Tokyo Stock Exchange; (ii) companies listed on a Japanese secondary market and
(iii) companies whose securities are not listed on a stock exchange or secondary
market. Up to 35% of the fund's total assets may include cash equivalents,
investment grade fixed income securities (rated in one of the four highest
categories by one of the major independent rating agencies, or in unrated
securities that the adviser considers of comparable quality) and equity and
equity related securities of large and medium capitalization companies located
in Japan, and companies of any size located outside of Japan.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund
focuses its investments in Japan, it could be particularly susceptible to the
effects of political and economic developments within Japan. In addition, most
Japanese companies engage in "cross-shareholding" where companies hold the
equity securities of each other. Cross-held shares may limit the power of
institutional investors to pressure management teams for better returns.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

12 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

JAPANESE SMALL CAP EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 1.00%
Shareholder Service Fee.................. None
Other Expenses........................... 0.70%
Total Annual Fund Operating Expenses..... 1.70%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... 1.00%
Shareholder Service Fee........................... None
Other Expenses.................................... 0.70%
Reimbursements.................................... -0.45%
Total Annual Fund Operating Expenses.............. 1.25%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 173 $ 536
</TABLE>

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

13 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN SMALL CAP EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of small capitalization companies located in
Europe.

The team seeks companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of small capitalization companies
located in Europe. Small capitalization companies are (i) companies ranked
according to market capitalization in the bottom 25% of issuers listed on a
European stock exchange; (ii) companies listed on a European secondary market
and (iii) companies whose securities are not listed on a stock exchange or
secondary market. Up to 35% of the fund's total assets may be invested in cash
equivalents, investment grade fixed income securities (rated in one of the four
highest categories by one of the major independent rating agencies, or in
unrated securities that the adviser considers of comparable quality) and equity
and equity related securities of medium and large capitalization companies
located in Europe and companies of any size located outside of Europe (including
the U.S.). The fund may invest more than 25% of its assets in securities of
small cap companies whose securities are denominated in the euro, as well as in
the securities of small cap companies located in the United Kingdom.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
focus its investments in euro denominated issues, as well as in the United
Kingdom, it could be particularly susceptible to the effects of political and
economic developments in these regions.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

14 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN SMALL CAP EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
BT Alex Brown European Small Cap Index. How the fund has performed in the past
is not necessarily an indication of how the fund will perform in the future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 18.91%
Dec/31/96 12.78%
Dec/31/97 -5.29%
Dec/31/98 22.08%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 16.61% in 1st quarter 1998
Lowest: -13.44% in 3rd quarter 1998

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell European Small Cap
Equity, Institutional Shares 22.08% 10.32%
BT Alex Brown European Small Cap Index 13.69% 12.01%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 1.00%
Shareholder Service Fee.................. None
Other Expenses........................... 1.96%
Total Annual Fund Operating Expenses..... 2.96%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 1.00%
Shareholder Service Fee.......................... None
Other Expenses................................... 1.96%
Reimbursements................................... -1.71%
Total Annual Fund Operating Expenses............. 1.25%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 299 $ 915 $ 1,557 $ 3,280
</TABLE>

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

15 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING MARKETS EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of companies located in emerging securities
markets.

The fund focuses on undervalued stocks with fast-growing earnings and superior
near-to-intermediate term performance potential.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the equity and equity related securities of growth-oriented companies located in
emerging securities markets. Up to 35% of the fund's total assets may include
cash equivalents, investment grade fixed income securities (rated in one of the
four highest categories by one of the major independent rating agencies, or in
unrated securities that the adviser considers of comparable quality) and equity
and equity related securities traded in developed markets (including the U.S.).
The fund may invest more than 25% of its assets in securities of Mexican and
Brazilian companies.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF EMERGING SECURITIES MARKETS. Emerging markets generally have economic
structures that are less mature, they have less stable political systems and may
have rapidly changing interest rates. Regulators in emerging markets are more
likely to impose capital controls than is the case in developed markets. These
markets are highly volatile and subject to change with political or economic
developments.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

DUE TO THE SIGNIFICANT RISKS INVOLVED IN INVESTING IN EMERGING MARKETS, THIS
FUND IS DESIGNED FOR AGGRESSIVE INVESTORS.

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

16 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING MARKETS EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
Morgan Stanley MSCI Emerging Markets Free Index. How the fund has performed in
the past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 -10.01%
Dec/31/96 10.64%
Dec/31/97 -12.07%
Dec/31/98 -29.69%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 23.48% in 3rd quarter 1994
Lowest: -25.85% in 3rd quarter 1998

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell Emerging Markets Equity,
Institutional Shares -29.69% -9.77%
Morgan Stanley MSCI Emerging Markets Free
Index -25.34% -10.05%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 1.00%
Shareholder Service Fee.................. None
Other Expenses........................... 0.52%
Total Annual Fund Operating Expenses..... 1.52%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 1.00%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.52%
Reimbursements................................... -0.27%
Total Annual Fund Operating Expenses............. 1.25%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 155 $ 480 $ 829 $ 1,813
</TABLE>

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

17 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

CORE GLOBAL FIXED INCOME FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks total return, emphasizing current income and, to a lesser extent,
opportunities for growth of capital consistent with reasonable investment risk.
To pursue this objective, the fund invests in investment grade fixed income
securities of issuers throughout the world. The portfolio management team
intends to maintain a portfolio duration of plus or minus 1 year around the
fund's benchmark index.

In managing the fund, the portfolio management team uses a "top-down" approach.
This approach focuses on country selection and currency management rather than
individual security selection. The team considers macro-economic factors such as
inflation, interest rates, monetary and fiscal policies, taxation and political
climate.

The currency portion of the fund's position in fixed income securities is
generally designed to enhance returns during periods of relative U.S. dollar
weakness and to protect returns during periods of relative U.S. dollar strength.
The team may take a position in a country's currency, without owning securities
within the market.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the fixed income securities of issuers located throughout the world. The fund
invests primarily in investment grade fixed income securities that, at the time
of purchase, are either rated in one of the three highest categories by a major
independent rating agency, or in unrated securities that the adviser considers
of comparable quality. The fund may also invest in investment grade fixed income
securities rated in the fourth highest category. In the event that any security
is downgraded, the adviser will determine whether to hold or sell such security,
provided that the fund will not hold more than 5% of its net assets in
securities that are rated below investment grade (high yield/high risk bonds).
Up to 35% of the fund's total assets may be invested in domestic and foreign
cash equivalents. The fund may invest more than 25% of its total assets in
securities denominated in the euro, as well as in the securities of companies
located in each of Japan, the United States, and the United Kingdom.

The fund uses derivatives, including forward contracts and currency options to
control volatility and achieve desired currency weightings in a cost-effective
manner.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

INTEREST RATE, PREPAYMENT AND EXTENSION RISK. The value of your investment will
fluctuate in response to interest rate changes. Generally, if rates rise, the
value of debt securities falls; if rates fall, the value of debt securities
rises. When rates increase, slower than expected principal payments for a longer
period may permit issuers to extend the average life of securities, locking in
below-market interest rates and reducing the value of these securities. As
interest rates decline, some issuers may prepay principal earlier than
scheduled, forcing the fund to reinvest in lower yielding securities.

CREDIT RISK. The issuer of a security owned by the fund may default on its
obligation to pay principal and/or interest or may have its credit rating
downgraded. Fixed income securities rated in the fourth highest category have
speculative characteristics. These securities involve a greater risk of loss
than higher quality securities and are more sensitive to changes in the issuer's
capacity to pay.

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
focus its investments in euro denominated issues, as well as in Japan, the
United States and the United Kingdom, the fund could be particularly susceptible
to the effects of political and economic developments in these regions.

RISKS OF CURRENCY POSITIONS. A change in economic policy may cause a greater
fluctuation in the country's currency than in bonds denominated in that
currency.

NON-DIVERSIFIED STATUS. The fund is non-diversified. Compared with other funds,
the fund may invest a greater percentage of its assets in a particular issuer.
This will cause the fund to be more susceptible to developments affecting any
single issuer of portfolio securities.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

18 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

CORE GLOBAL FIXED INCOME FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.50%
Shareholder Service Fee.................. None
Other Expenses........................... 0.46%
Total Annual Fund Operating Expenses..... 0.96%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... 0.50%
Shareholder Service Fee........................... None
Other Expenses.................................... 0.46%
Reimbursements.................................... -0.41%
Total Annual Fund Operating Expenses.............. 0.55%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 98 $ 306
</TABLE>

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

19 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL FIXED INCOME FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks total return, with an emphasis on current income and, to a lesser
extent, opportunities for capital growth consistent with reasonable investment
risk. To pursue this objective, the fund invests primarily in investment grade
fixed income securities of issuers throughout the world. The portfolio
management team intends to maintain a portfolio duration of plus or minus 1 year
around the fund's benchmark index.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the fixed income securities of issuers located throughout the world. The fund
invests primarily in investment grade fixed income securities that, at the time
of purchase, are either rated in one of the four highest categories by a major
independent rating agency, or in unrated securities the adviser considers of
comparable quality. The fund may invest up to 15% of its total assets in fixed
income securities rated below investment grade (high yield/high risk bonds),
including the securities of issuers in emerging securities markets. Up to 35% of
the fund's total assets may be invested in domestic and foreign cash
equivalents. The fund may invest more than 25% of its total assets in securities
denominated in the euro, as well as in the securities of companies located in
each of Japan, the United States, and the United Kingdom.

The fund may use derivatives, including forward contracts and currency options
to control volatility and achieve desired currency weightings in a
cost-effective manner.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

INTEREST RATE, PREPAYMENT, AND EXTENSION RISK. The value of your investment
will fluctuate in response to interest rate changes. Generally, if rates rise,
the value of debt securities falls; if rates fall, the value of debt securities
rises. When rates increase, slower than expected principal payments for a longer
period may permit issuers to extend the average life of securities, locking in
below-market interest rates and reducing the value of these securities. As
interest rates decline, some issuers may prepay principal earlier than
scheduled, forcing the fund to reinvest in lower yielding securities.

CREDIT RISK. The issuer of a security owned by the fund may default on its
obligation to pay principal and/or interest or may have its credit rating
downgraded. Fixed income securities rated in the fourth highest grade have
speculative characteristics. Below investment grade securities (high yield/ high
risk securities) involve greater price volatility and risk of loss of principal
and income and are highly speculative in nature.

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
focus its investments in euro denominated issues, as well as in Japan, the
United States, and the United Kingdom, the fund could be particularly
susceptible to the effects of political and economic developments in these
regions.

RISKS OF CURRENCY POSITIONS. A change in economic policy may cause a greater
fluctuation in the country's currency than in bonds denominated in that
currency.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

20 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL FIXED INCOME FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
Salomon World Government Bond Index. How the fund has performed in the past is
not necessarily an indication of how the fund will perform in the future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 17.76%
Dec/31/96 5.23%
Dec/31/97 1.04%
Dec/31/98 13.30%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 9.71% in 1st quarter 1995
Lowest: -4.05% in 1st quarter 1997

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell Global Fixed Income,
Institutional Shares 13.30% 6.74%
Salomon World Government Bond Index 15.31% 7.84%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.50%
Shareholder Service Fee.................. None
Other Expenses........................... 0.27%
Total Annual Fund Operating Expenses..... 0.77%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... 0.50%
Shareholder Service Fee........................... None
Other Expenses.................................... 0.27%
Reimbursements.................................... -0.17%
Total Annual Fund Operating Expenses.............. 0.60%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 79 $ 246 $ 428 $ 954
</TABLE>

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

21 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL FIXED INCOME FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks total return, with an emphasis on current income and, to a lesser
extent, opportunities for capital growth consistent with reasonable investment
risk. To pursue this objective, the fund invests in investment grade fixed
income securities of issuers in countries other than the United States. The
portfolio management team intends to maintain a portfolio duration of plus or
minus 1 year around the fund's benchmark index.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
the fixed income securities of foreign issuers. The fund invests in investment
grade fixed income securities that, at the time of purchase, are rated in one of
the three highest categories by a major independent rating agency, or in unrated
securities the adviser considers of comparable quality. The Fund may invest up
to 10% of its total assets in investment grade fixed income securities rated in
the fourth highest category. In the event that any security is downgraded, the
adviser will determine whether to hold or sell such security, provided that the
fund will not hold more than 5% of its net assets in securities that are rated
below investment grade (high yield/high risk bonds). Up to 35% of the fund's
total assets may be invested in domestic and foreign cash equivalents and in
U.S. fixed income securities. The fund may invest more than 25% of its total
assets in securities denominated in the euro, as well as in the securities of
companies located in each of Japan and the United Kingdom.

The fund may use derivatives, including forward contracts and currency options
to control volatility and achieve desired currency weightings in a
cost-effective manner.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

INTEREST RATE AND PREPAYMENT RISK. The value of your investment will fluctuate
in response to interest rate changes. Generally, if rates rise, the value of
debt securities falls; if rates fall, the value of debt securities rises. When
rates increase, slower than expected principal payments for a longer period may
permit issuers to extend the average life of securities, locking in below-market
interest rates and reducing the value of these securities. As interest rates
decline, some issuers may prepay principal earlier than scheduled, forcing the
fund to reinvest in lower yielding securities.

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
focus its investments in euro denominated issues, as well as in Japan and the
United Kingdom, the fund could be particularly susceptible to the effects of
political and economic developments in these regions.

RISKS OF CURRENCY POSITIONS. A change in economic policy may cause a greater
fluctuation in the country's currency than in bonds denominated in that
currency.

In addition, the value of the fund's shares depends in part on the adviser's
ability to assess economic conditions and investment opportunities.

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

22 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL FIXED INCOME FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
Salomon World Government Bond Index, Non-US. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 17.81%
Dec/31/96 5.54%
Dec/31/97 -3.31%
Dec/31/98 17.44%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 8.44% in 3rd quarter 1998
Lowest: -5.97% in 1st quarter 1997

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell International Fixed
Income, Institutional Shares 17.44% 7.29%
Salomon World Govt Bond Index, Non-US 17.79% 8.54%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.50%
Shareholder Service Fee.................. None
Other Expenses........................... 0.58%
Total Annual Fund Operating Expenses..... 1.08%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 0.50%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.58%
Reimbursements................................... -0.53%
Total Annual Fund Operating Expenses............. 0.55%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 110 $ 343 $ 595 $ 1,317
</TABLE>

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

23 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING MARKETS DEBT FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks total return. To pursue this objective, the fund invests
primarily in fixed income securities of issuers in countries with new or
emerging securities markets. The portfolio management team intends to maintain a
portfolio duration of plus or minus 1 year around the fund's benchmark index.

In managing the fund, the portfolio management team uses a "top-down" approach.
This approach focuses on country selection, but security selection is an
important source of value.

Countries are selected according to macro-economic factors such as inflation,
interest rates, monetary and fiscal policies and the political climate. Short
term factors such as market sentiment, capital flows and new issue programs are
also evaluated.

PRINCIPAL HOLDINGS

Under normal circumstances, the fund invests at least 65% of its total assets in
the (high yield/high risk) fixed income securities of issuers located in
countries with new or emerging securities markets. These include performing and
non-performing loans, Eurobonds, Brady Bonds (dollar denominated securities used
to refinance foreign government bank loans) and other fixed income securities of
foreign governments and their agencies as well as some corporate debt
instruments. Up to 35% of the fund's total assets may be invested in domestic
and foreign cash equivalents and U.S. fixed income securities. The fund may
invest more than 25% of its total assets in the securities of companies located
in Argentina, Brazil and Mexico.

Fixed income securities in which the fund may invest may be of any credit
quality, including securities not paying interest currently, zero coupon bonds,
pay-in-kind securities and securities in default. The loans and debt instruments
in which the fund may invest may be denominated in a major currency or in a
local currency.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

CREDIT RISK. The issuer of a security owned by the fund may default on its
obligation to pay principal and/or interest or may have its credit rating
downgraded. Securities with low credit quality involve greater price volatility
and risk of loss of principal and income and are highly speculative in nature.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

DUE TO THE SIGNIFICANT RISKS INVOLVED, THIS FUND IS DESIGNED FOR AGGRESSIVE
INVESTORS.

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

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

24 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING MARKETS DEBT FUND (CONTINUED)
- --------------------------------------------------------------------------------

FUND PERFORMANCE
- --------------------------------------------------------------------------------

The bar chart indicates the risks of investing in the fund by showing changes in
the fund's performance from year to year. The table shows how the fund's average
annual total returns for different calendar years compare to the return of the
JP Morgan Emerging Markets Bond Plus Index. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/95 20.02%
Dec/31/96 33.47%
Dec/31/97 12.51%
Dec/31/98 -34.28%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 16.99% in 2nd quarter 1995
Lowest: -34.74% in 3rd quarter 1998

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell Emerging Markets Debt,
Institutional Shares -34.28% 3.39%
JP Morgan Emerging Markets Bond Index
Plus -14.35% 12.35%
</TABLE>

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of the fund.

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 1.00%
Shareholder Service Fee.................. None
Other Expenses........................... 0.31%
Total Annual Fund Operating Expenses..... 1.31%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 1.00%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.31%
Reimbursements................................... -0.31%
Total Annual Fund Operating Expenses............. 1.00%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
With or without
redemption $ 133 $ 415 $ 718 $ 1,579
</TABLE>

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

25 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING LOCAL CURRENCY DEBT FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks total return. To pursue this objective, the fund invests
primarily in fixed income securities denominated in currencies of emerging
markets countries. The portfolio management team intends to maintain a portfolio
duration of plus or minus 1 year around the fund's benchmark index.

When managing the fund, the portfolio management team will use a "top-down"
approach. This approach will focus on country selection and currency management
rather than individual security selection. The team will consider macro-economic
factors such as inflation, interest rates, monetary and fiscal policies,
taxation and the political climate.

In making investments for the fund, the portfolio management team will give
primary emphasis to the attractiveness of the local currencies in which
investments are denominated. The fund will generally not attempt to hedge
foreign currency exchange rate risks.

PRINCIPAL HOLDINGS

Under normal conditions, the fund invests at least 65% of its total assets in
(high yield/high risk) debt instruments denominated in currencies of issuers
located in emerging markets countries. Fixed income securities in which the fund
invests may be of any credit quality, including securities not paying interest
currently, zero coupon bonds, pay-in-kind securities and securities in default.
Up to 35% of the fund's total assets may be invested in domestic and foreign
cash equivalents and U.S. fixed income securities. The fund may invest more than
25% of its total assets in the securities of companies located in Mexico. The
fund may purchase securities on a when-issued basis.

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

WHEN-ISSUED SECURITIES RISK. The market value of the securities purchased on a
when-issued basis may change before the securities are delivered.

Because the fund generally does not hedge foreign currency exchange rate risk,
the fund's return may be more dependent on the portfolio management team's
judgment as to the relative attractiveness of the local currencies in which the
fund's investments are denominated.

DUE TO THE SIGNIFICANT RISKS INVOLVED, THIS FUND IS DESIGNED FOR AGGRESSIVE
INVESTORS.

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

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

26 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EMERGING LOCAL CURRENCY DEBT FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ 0.60%
Shareholder Service Fee.................. None
Other Expenses........................... 0.56%
Total Annual Fund Operating Expenses..... 1.16%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees.................................... 0.60%
Shareholder Service Fee.......................... None
Other Expenses................................... 0.56%
Reimbursements................................... -0.46%
Total Annual Fund Operating Expenses............. 0.70%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 118 $ 368
</TABLE>

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

27 Prospectus - International Mutual Funds
<PAGE>
MORE ABOUT RISK
- ----------------------------------------

When you invest in mutual funds you are taking the risk that your investment
will lose money or not earn as much as you expect. Past returns are not an
indication of future performance and there is no guarantee that the fund will
meet its investment objective.

The Board of Trustees may change each fund's investment objective without
obtaining the approval of the shareholders.

ACTIVE MANAGEMENT

The funds' investment advisers actively seek securities in which to invest,
rather than investing in a predetermined basket of stocks and/or bonds such as
an index. A fund may underperform relative to its stated benchmark, due to the
investment adviser's securities choices and choices in asset allocation.

CURRENCY EXCHANGE RATES

Currency exchange rates are the rate at which a foreign currency is converted to
the U.S. dollar. Currency exchange rate movements could reduce gains or create
losses for a fund.

DEFENSIVE INVESTING

Each fund may depart from its principal investment strategies by taking
temporary defensive positions in response to adverse market, economic or
political conditions. If a fund takes a temporary defensive position, it may be
unable to achieve its investment objective.

DERIVATIVES

Each fund may use derivatives. Derivatives are financial instruments whose value
derives from another security or an index. Futures, options and foreign currency
forward contracts are types of derivatives. Derivatives used for hedging may not
fully offset the underlying positions. Derivatives used for risk management may
not have the intended effects and may result in losses or missed opportunities.
Derivatives that involve leverage may magnify losses. In addition, there is a
risk that a counterparty will fail to honor a contract's terms resulting in a
loss for the fund.

EMERGING MARKETS SECURITIES

The funds may invest in emerging markets securities. Developing markets have
economic structures that are less mature, have less stable political systems and
may have high inflation, rapidly changing interest and currency exchange rates.
Emerging markets may lack the social, political and economic stability
characteristics of more developed countries. Investments generally tend to be
more illiquid (more difficult to trade) and more volatile than those of other
foreign investments.

EQUITY AND EQUITY RELATED SECURITIES

The funds may invest in common stock, preferred stock, warrants, purchased call
options and other rights to acquire stock. The market value of an equity
security will increase or decrease depending on market conditions. This affects
the value of the shares of a fund, and the value of your investment.

EURO DENOMINATED SECURITIES

On January 1, 1999, the currencies of the following countries converted into one
common currency: Austria, Belgium, Finland, France, Germany, Ireland,
Luxembourg, Italy, the Netherlands, Portugal, and Spain. There is a risk that
the conversion may not go as anticipated and that a fund may be affected by
pricing errors and adverse tax consequences.

FIXED INCOME SECURITIES (BONDS)

The funds may invest in government securities, corporate fixed income securities
and obligations to repay borrowed money within a certain time with or without
interest. The value of a fund's bonds could rise in value when interest rates
fall and decline when interest rates rise. The longer a bond's duration and the
lower its credit quality, the more its value typically falls. A less significant
risk is default by the bond issuer on principal or interest payments. A
security's credit rating may be downgraded at any time.

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

28 Prospectus - International Mutual Funds
<PAGE>
MORE ABOUT RISK (CONTINUED)
- --------------------------------------------------------------------------------

FOREIGN SECURITIES

The risks of investing in foreign securities are generally higher than investing
in domestic securities. A foreign government could expropriate or nationalize
assets, impose withholding or other taxes on dividend or interest payments or
capital gains, and prohibit transactions in the country's currency. Foreign
companies may not be subject to the same accounting, auditing and financial
reporting standards and requirements as U.S. companies. Foreign brokerage
commissions and custodian fees are generally higher than those in the United
States. In many foreign countries, securities markets are less liquid, more
volatile, and subject to less government regulation than U.S. securities
markets.

FOREIGN CURRENCY FORWARD CONTRACTS

A foreign currency forward contract is an obligation to buy or sell a given
currency on a future date and at a set price. See "Derivatives."

FUTURES CONTRACTS

A futures contract is an agreement to buy or sell a set quantity of an
underlying instrument at a future date or to make or receive a cash payment
based on the value of a securities index. See "Derivatives."

HEDGING

Hedging involves the attempt to offset a potential loss in one position by
establishing an interest in an opposite position. See "Derivatives."

OPTIONS CONTRACTS

An option is the right to buy or sell securities that is granted in exchange for
an agreed upon sum. See "Derivatives."

LENDING SECURITIES

Each fund may lend its securities to broker-dealers for the purpose of receiving
income. There is a potential for default from the borrower.

PORTFOLIO TURNOVER

Each fund's management approach, which may include short-term trading, could
cause the fund's portfolio turnover rate to be above average. High turnover will
increase the fund's transaction costs and may result in net gains which, when
distributed, could increase your tax liability.

SHORT-TERM TRADING

The funds may sell a security shortly after buying it. Increased trading could
raise the fund's brokerage and related costs. Increased short-term capital gains
distributions would raise shareholders' income tax.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES

The funds may purchase or sell a security at a future date for a predetermined
price. The market value of the securities may change before delivery.

YEAR 2000 PROBLEM

Many computer systems today cannot distinguish the year 2000 from the year 1900
because of the way dates are encoded and calculated. The cost of addressing the
Year 2000 problem, if substantial, could adversely affect companies and
governments that issue securities held by the fund. The investment adviser is
taking steps designed to address the Year 2000 problem and to obtain reasonable
assurances that comparable steps are being taken by the funds' other major
service providers. Although there can be no assurance that these systems will be
properly adapted in time for the Year 2000, the adviser expects that they will
be.

ZERO COUPON SECURITIES, PAY-IN-KIND SECURITIES, DISCOUNT OBLIGATIONS, MORTGAGE
AND ASSET-BACKED SECURITIES, CONVERTIBLE SECURITIES AND HIGH YIELD SECURITIES

The fund may invest in obligations to repay borrowed money within a certain time
with or without interest. Debt securities are affected by changes in interest
rates. In general, when interest rates go up, the value of a debt security
decreases; when interest rates go down, the value of a debt security increases.
There is the risk that the borrower will not be able to fulfill its obligation
resulting in a loss, or a lower price than anticipated.

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

29 Prospectus - International Mutual Funds
<PAGE>
INVESTMENT ADVISER
- ----------------------------------------

The day-to-day operations of the funds, including investment decisions, have
been delegated to the adviser, Morgan Grenfell Investment Services Limited (MGIS
or the adviser). MGIS is located at 20 Finsbury Circus, London, England. MGIS
provides a full range of international investment advisory services to
institutional clients, and as of October 31, 1998, managed approximately $12.1
billion in assets. The adviser is responsible for making specific decisions to
buy and sell portfolio securities for the funds. The adviser is also responsible
for selecting brokers and dealers and for negotiating brokerage commissions and
dealer charges. For these services, the adviser is entitled to a monthly fee at
an annual rate of each fund's average daily net assets as follows:

<TABLE>
<S> <C>
Morgan Grenfell International Select Equity
Fund 0.70%
Morgan Grenfell Global Equity Fund 0.70%
Morgan Grenfell European Equity Growth Fund 0.70%
Morgan Grenfell New Asia Fund 0.70%
Morgan Grenfell International Small Cap
Equity Fund 1.00%
Morgan Grenfell Japanese Small Cap Equity
Fund 1.00%
Morgan Grenfell European Small Cap Equity
Fund 1.00%
Morgan Grenfell Emerging Markets Equity Fund 1.00%
Morgan Grenfell Core Global Fixed Income Fund 0.50%
Morgan Grenfell Global Fixed Income Fund 0.50%
Morgan Grenfell International Fixed Income
Fund 0.50%
Morgan Grenfell Emerging Markets Debt Fund 1.00%
Morgan Grenfell Emerging Local Currency Debt
Fund 0.60%
</TABLE>

MGIS is a subsidiary of Morgan Grenfell Asset Management Limited (MGAM), which
is a wholly-owned subsidiary of Deutsche Bank AG, an international commercial
and investment banking group.

PORTFOLIO MANAGEMENT

A committee made up of investment professionals and analysts employed by the
adviser makes all of the funds' investment decisions.

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

30 Prospectus - International Mutual Funds
<PAGE>
Managing Your Investment

BUYING AND SELLING SHARES
- ----------------------------------------

BUYING AND SELLING SHARES THROUGH A PLAN

If you are investing through a large retirement plan or other special program,
follow the instructions in your program materials.

BUYING AND SELLING SHARES THROUGH A BROKER

Each fund has authorized brokers to accept purchase and redemption orders on
behalf of the fund. If you invest through a broker, you may be subject to
minimums established by the broker. Also, you may be subject to transaction fees
for buying or selling shares. When you buy or sell shares through a broker, it
is the responsibility of the broker to forward the request to us. If we do not
receive the request in a timely manner, you may not receive that day's NAV. Your
financial professional will be able to assist you in establishing your fund
account, buying and selling shares, and monitoring your investment.
To open an account without the help of a financial professional, please use the
instructions on these pages.

BUYING AND SELLING SHARES DIRECTLY

SALES CHARGE. There is no sales charge for buying institutional shares of the
funds listed in this prospectus.

MINIMUM INITIAL INVESTMENT. The minimum initial investment is $250,000. We
reserve the right to vary the initial investment amount at any time. We also
reserve the right to waive the minimum initial investment amount at any time.

MINIMUM ADDITIONAL INVESTMENT. There is no minimum additional investment
amount. We reserve the right to establish minimums for additional investments at
any time.

Each fund reserves the right to reject any purchase order or suspend the
offering of its shares.

Buying Shares for the First Time

Complete the enclosed application. You can avoid future inconvenience by signing
up now for any services you might later use.
BY MAIL. Complete the enclosed account application and mail it with a check to
Morgan Grenfell Investment Trust.
BY WIRE. You must have an account with a commercial bank that is a member of
the Federal Reserve System. We do not charge a wire fee, but your bank might.

- - First, telephone 1-800-550-6426 to be assigned an account number.

- - Even if you are purchasing shares by wire, you must promptly complete the
account application accompanying this prospectus and send it to Morgan
Grenfell Investment Trust.
- - Specify your name, account number, taxpayer identification or social security
number and address in the wire. Have the wire sent to:
United Missouri Bank, N.A.
ABA No. 10-10-00695
For: Account Number 98-7052-395-7
Further Credit: [appropriate fund name]

Buying Additional Shares

BY MAIL. Send a check along with either an order form or a letter stating the
amount of investment to be made, the name of the fund you want to invest in, and
your account number to Morgan Grenfell Investment Trust.

BY WIRE. We do not charge a wire fee, but your bank might. Specify your name,
account number, taxpayer identification or social security number and address in
the wire. Have the wire sent to:
United Missouri Bank, N.A.
ABA No. 10-10-00695
For: Account Number 98-7052-395-7
Further Credit: [appropriate fund name]

Selling Shares

BY MAIL. Specify the number of institutional shares you wish to sell, the name
of the fund from which institutional shares are being redeemed, your account
number, payment instructions, and the exact registration on the account. Send
the information to Morgan Grenfell Investment Trust. Make sure you sign your
letter. Additional information, such as a signature guarantee, may be required.

BY PHONE. If you have selected the optional telephone redemption privilege on
your account application, you may redeem institutional shares of any fund,
without charge, by calling 1-800-550-6426. Requests must be made before 4:00
p.m. Eastern Standard Time. After your request has been

<TABLE>
<CAPTION>
ALL CORRESPONDENCE SHOULD BE SENT TO:
BY REGULAR MAIL BY OVERNIGHT MAIL
<S> <C>
Morgan Grenfell Morgan Grenfell
Investment Trust Investment Trust
P.O. Box 419165 c/o DST Systems, Inc.
Kansas City, MO CT-8 Tower
64141-6165 330 West 9th Street
Kansas City, MO 64105
</TABLE>

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

31 Prospectus - International Mutual Funds
<PAGE>
Managing Your Investment

BUYING AND SELLING SHARES (CONTINUED)
- --------------------------------------------------------------------------------
verified, a check for the net amount will be mailed to the registered owner(s)
at the address of record. It may be difficult to implement telephone redemptions
in times of dramatic economic or market changes.

You may be asked to provide certain information that is unique to your account,
in order for us to verify the authenticity of your phone call.

HOW SHARES ARE PRICED

The price you pay when you buy, or receive when you sell, is based upon the net
asset value (NAV) of your fund. The NAV is calculated by dividing the net assets
(total assets minus liabilities) of each fund class by the number of shares of
that class outstanding. The NAV is calculated at the close of regular trading
every day the New York Stock Exchange (NYSE) is open for business (generally
4:00 p.m., Eastern time). If the NYSE closes early, the fund will accelerate the
calculation of NAV and transaction deadlines to the actual closing time. Shares
will not be priced on national holidays or other days on which the NYSE is
closed for trading.

The fund uses a forward pricing procedure. Therefore, the price at which you buy
or sell shares is based on the next calculation of the NAV after the order is
received by the fund or our broker, provided that your broker forwards your
order to the fund in a timely manner.

Certain shares held by the funds are listed on foreign exchanges and trade at
times and on days when the NYSE is closed. As a result, the net asset value of
each class of each fund may be significantly affected by such trading and at
times and on days when you have no ability to redeem shares of the fund.

If the adviser believes that an asset's market value does not reflect its fair
value, then the Board of Trustees, in good faith, will determine fair value.

PAYMENT OF REDEMPTION PROCEEDS

BY WIRE. When you sell shares, the proceeds will be wired to the bank account
you designated on the account application, unless payment by check has been
requested. Normally, redemption proceeds will be wired no more than seven days
after the transfer agent receives the appropriate redemption request documents,
including any additional documentation we may ask for, to verify the
authenticity of your request. Frequently, the proceeds will be wired on the next
Business Day after receipt of such documents.

You may receive your redemption proceeds by Federal Reserve wire or Automated
Clearing House (ACH) wire. Redemption requests by federal wire cannot be made on
federal holidays. Transactions made by ACH will not be posted to a shareholder's
bank account until the second business day following the transaction. We do not
charge a wire fee, but your bank might.

If you wish to change the bank designated to receive redemption proceeds, you or
an authorized representative must send a signed written request to the transfer
agent. The signature must be guaranteed by a bank, a member of a national stock
exchange, or another eligible institution. The transfer agent may require
additional documentation in connection with your request. Please contact the
transfer agent for more information.

The payment of redemption proceeds 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.

You may redeem shares in cash up to the lesser of $250,000 or 1% of the net
asset value of the fund during any 90 day period. Redemptions in excess of this
limitation may be made in-kind. Please see the SAI for more information.
<TABLE>
<CAPTION>
ALL CORRESPONDENCE SHOULD BE SENT TO:
BY REGULAR MAIL BY OVERNIGHT MAIL
<S> <C>
Morgan Grenfell Morgan Grenfell
Investment Trust Investment Trust
P.O. Box 419165 c/o DST Systems, Inc.
Kansas City, MO CT-8 Tower
64141-6165 330 West 9th Street
Kansas City, MO 64105
</TABLE>

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

32 Prospectus - International Mutual Funds
<PAGE>
Managing Your Investment

HOLDING SHARES
- ----------------------------------------

EXCHANGING SHARES
Institutional shares of one fund can be exchanged for institutional shares of
any other Morgan Grenfell fund in amounts as low as $50,000. Be sure to read the
prospectus relating to the institutional shares of the fund you wish to acquire
and consider its investment objective, policies and fees before making an
exchange into that fund.
An exchange of a fund's shares for shares of another fund will be treated as a
sale of the fund's shares and a gain on the transaction may be subject to
federal income tax.
BY MAIL. Send a written request to Morgan Grenfell Investment Trust.
BY PHONE. Telephone 1-800-550-6426 to speak to a Representative.

DIVIDENDS AND DISTRIBUTIONS
Each of the funds described in this prospectus pays dividends from net
investment income and net capital gains to shareholders, at least annually. Your
share of the income and capital gains the fund distributes is based on the
number of shares you own. You can receive your distributions in cash or reinvest
them in the same fund. You may change this preference at any time by notifying
us in writing. If no election is made, all dividends and capital gain
distributions will be reinvested in the same fund.
The fund's distributions, whether received in cash or reinvested in additional
shares of the fund, may be subject to federal, state and local tax.

TAX CONSIDERATIONS
This tax information is general in nature and may not apply to certain
tax-deferred accounts or other non-taxable entities. You should consult your tax
adviser to discuss how investing in the funds described in this prospectus will
affect your personal tax situation.
As a shareholder, you will generally pay taxes on the dividends and
distributions you receive, whether they are received in cash or reinvested.
Selling or exchanging shares or receiving dividends and distributions will
create tax liability. The following demonstrates how various transactions are
taxed for federal income tax purposes.

<TABLE>
<CAPTION>
DISTRIBUTION
RECEIVED: TREATED AS:
<S> <C>
Income Dividends and Ordinary income
Short-term capital
gains distributions
Long-term capital Capital gains (generally
gains distributions taxed at a maximum of 20%)
(over 12 months)
Selling or exchanging Generally, capital gains or
shares owned more losses
than a year
Selling or exchanging For gains: short-term
shares owned one year capital gains; For losses:
or less than a year special rules apply. Please
consult your tax adviser or
see the SAI.
</TABLE>

If you buy shares of a fund right before it makes a taxable dividend or
distribution, part of your investment will come back to you as a taxable
distribution. Unless you are investing in a tax-deferred account, such as an
IRA, this is not to your advantage since you will pay tax on the dividend but
will not have shared in the increase in NAV of the fund.
If you sell shares at a loss for tax purposes and invest in a substantially
similar investment within a 61 day period beginning 30 days before and ending 30
days after the sale date, the sale is generally considered a "wash sale" and you
will be unable to claim a tax loss.
Every year, the fund will send you information detailing the amount of income
and capital gains distributed to you for the previous year and the proceeds of
your redemptions (including exchanges).
If you fail to furnish your correct taxpayer identification number and required
certifications, you may be subject to a 31% backup withholding tax.
Foreign investors are subject to different tax rules and may be subject to
non-resident alien withholding tax at the rate of 30% (or a lower rate provided
by an applicable tax treaty) on amounts treated as ordinary dividends. Unless a
current IRS Form W-8 or acceptable substitute is on file, backup withholding on
certain other payments may apply as well.
Because everyone's tax situation is unique, always consult your tax professional
about federal, state and local tax consequences.

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

33 Prospectus - International Mutual Funds
<PAGE>
FINANCIAL HIGHLIGHTS
- ----------------------------------------

The financial highlights table is intended to help you understand the funds'
financial performance for the past 5 years, or, if shorter, the period of the
funds' operations. Certain information reflects financial results for a single
fund share. The total returns in the table represent the rate that an investor
would have earned (or lost) on an investment in the fund (assuming reinvestment
of all dividends and distributions). This information has been audited by
PricewaterhouseCoopers LLP, whose report, along with the funds' financial
statements, are included in the Statement of Additional Information (SAI) and
annual report, which is available on request.

No data is shown below for Morgan Grenfell Global Equity Fund, Morgan Grenfell
New Asia Fund, Morgan Grenfell Japanese Small Cap Equity Fund and Morgan
Grenfell Emerging Local Currency Debt Fund because institutional shares of these
funds had not commenced operations on or prior to October 31, 1998.

FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD

+ RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED.

(1) INTERNATIONAL SELECT EQUITY FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS
ON 5/15/95. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(2) EUROPEAN EQUITY GROWTH FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
9/03/96. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(3) INTERNATIONAL SMALL CAP EQUITY FUND INSTITUTIONAL SHARES COMMENCED
OPERATIONS ON 1/03/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

AMOUNTS DESIGNATED AS "--" ARE EITHER $0.00 OR HAVE BEEN ROUNDED TO $0.00.

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

34 Prospectus - International Mutual Funds
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------

FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD

<TABLE>
<CAPTION>
NET
NET ASSET NET REALIZED DISTRIBUTIONS
VALUE INVESTMENT AND FROM NET DISTRIBUTIONS NET ASSET
BEGINNING INCOME/ UNREALIZED INVESTMENT FROM REALIZED VALUE END TOTAL
OF PERIOD (LOSS) GAINS (LOSSES) INCOME CAPITAL GAINS OF PERIOD RETURN
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------
European Small Cap Equity Fund:
- ------------------------------
Institutional Shares
1998 $11.80 $ 0.11 $ 1.61 $(0.04) $ -- $13.48 14.65%
1997 12.54 0.04 (0.22) (0.18) (0.38) 11.80 (1.47)
1996 11.55 0.12 1.03 (0.12) (0.04) 12.54 10.06
1995(1) 10.00 0.12 1.44 (0.01) -- 11.55 15.66+
- ----------------------------
Emerging Markets Equity Fund:
- ----------------------------
Institutional Shares
1998 $ 7.69 $ 0.03 $(2.42) $ -- $(0.38) $ 4.92 (32.66)%
1997 8.80 (0.03) (0.85) (0.01) (0.22) 7.69 (10.31)
1996 8.11 0.06 0.75 (0.03) (0.09) 8.80 10.02
1995 11.00 0.04 (2.29) (0.02) (0.62) 8.11 (21.00)
1994(2) 10.00 (0.01) 1.01 -- -- 11.00 10.00+
- ------------------------
Global Fixed Income Fund:
- ------------------------
Institutional Shares
1998 $10.84 $ 0.63 $ 0.45 $(0.34) $(0.22) $11.36 10.58%
1997 11.26 0.35 0.01 (0.50) (0.28) 10.84 3.34
1996 10.99 0.59 0.12 (0.37) (0.07) 11.26 6.60
1995 9.85 0.35 0.99 (0.20) -- 10.99 13.88
1994(3) 10.00 0.25 (0.40) -- -- 9.85 (1.50)+
- -----------------------
Core Global Fixed Income:
- -----------------------
Institutional Shares
1998(4) $10.00 $ 0.19 $ 0.78 $ -- $ -- $10.97 9.70%+
- -----------------------------
International Fixed Income Fund:
- -----------------------------
Institutional Shares
1998 $10.16 $ 0.51 $ 0.65 $(0.27) $(0.10) $10.95 11.87%
1997 11.30 0.20 (0.11) (0.64) (0.59) 10.16 0.82
1996 11.34 0.86 (0.12) (0.66) (0.12) 11.30 6.82
1995 9.94 0.42 1.03 (0.05) -- 11.34 14.66
1994(5) 10.00 0.29 (0.35) -- -- 9.94 (0.60)+
- ---------------------------
Emerging Markets Debt Fund:
- ---------------------------
Institutional Shares
1998 $11.95 $ 1.81 $(4.12) $(1.32) $(2.50) $ 5.82 (30.35)%
1997 13.36 1.05 0.40 (1.32) (1.54) 11.95 12.03
1996 10.55 1.21 2.60 (1.00) -- 13.36 38.42
1995 10.19 0.65 (0.17) (0.11) (0.01) 10.55 4.85
1994(6) 10.00 0.13 0.06 -- -- 10.19 1.90+

<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
RATIO OF EXPENSES INCOME/(LOSS)
NET TO AVERAGE TO AVERAGE NET
RATIO OF INVESTMENT NET ASSETS ASSETS
NET ASSETS EXPENSES INCOME/(LOSS) (EXCLUDING (EXCLUDING PORTFOLIO
END OF TO AVERAGE TO AVERAGE EXPENSE EXPENSE TURNOVER
PERIOD (000) NET ASSETS NET ASSETS LIMITATIONS) LIMITATIONS) RATE
- ----------------------------------- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------
European Small Cap Equity Fund:
- ------------------------------
Institutional Shares
1998 $ 2,930 1.25% 0.34% 2.96% (1.37)% 111%
1997 9,641 1.25 0.58 2.12 (0.29) 44
1996 9,856 1.25 0.96 2.50 (0.29) 49
1995(1) 9,336 1.25 1.25 2.24 0.26 34
- ----------------------------
Emerging Markets Equity Fund:
- ----------------------------
Institutional Shares
1998 $ 46,080 1.25% 0.90% 1.52% 0.63% 85%
1997 94,101 1.25 0.68 1.44 0.49 94
1996 88,279 1.25 0.63 1.52 0.36 69
1995 93,288 1.25 0.44 1.55 0.14 49
1994(2) 56,892 1.36 (0.12) 1.79 (0.55) 45
- ------------------------
Global Fixed Income Fund:
- ------------------------
Institutional Shares
1998 $ 58,422 0.60% 4.82% 0.77% 4.65% 182%
1997 92,180 0.65 5.30 0.77 5.18 179
1996 149,917 0.75 5.39 0.79 5.35 223
1995 139,337 0.78 5.61 0.87 5.52 147
1994(3) 53,915 0.85 5.71 1.28 5.28 173
- -----------------------
Core Global Fixed Income:
- -----------------------
Institutional Shares
1998(4) $ 33,585 0.55% 4.19% 0.96% 3.78% 151%
- -----------------------------
International Fixed Income Fund:
- -----------------------------
Institutional Shares
1998 $ 19,521 0.57% 4.36% 1.08% 3.85% 181%
1997 27,937 0.65 5.00 1.06 4.59 174
1996 21,155 0.75 5.41 1.03 5.13 235
1995 27,603 0.78 5.51 1.15 5.14 187
1994(5) 15,238 0.85 5.66 1.42 5.09 130
- ---------------------------
Emerging Markets Debt Fund:
- ---------------------------
Institutional Shares
1998 $ 55,684 1.05% 9.82% 1.31% 9.56% 638%
1997 187,455 1.32 7.15 1.47 7.00 472
1996 102,431 1.50 10.15 1.92 9.73 227
1995 84,438 1.79 10.97 2.05 10.71 266
1994(6) 16,248 1.90 7.04 2.60 6.34 52
</TABLE>

+ RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED.

(1) EUROPEAN SMALL CAP EQUITY FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
11/01/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(2) EMERGING MARKETS EQUITY FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
2/01/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(3) GLOBAL FIXED INCOME FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
1/04/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(4) CORE GLOBAL FIXED INCOME FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
5/4/98. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(5) INTERNATIONAL FIXED INCOME FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
3/15/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

(6) EMERGING MARKETS DEBT FUND INSTITUTIONAL SHARES COMMENCED OPERATIONS ON
8/4/94. ALL RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.

AMOUNTS DESIGNATED AS "--" ARE EITHER $0.00 OR HAVE BEEN ROUNDED TO $0.00.

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

35 Prospectus - International Mutual Funds
<PAGE>

MORGAN GRENFELL
INTERNATIONAL MUTUAL FUNDS/INSTITUTIONAL SHARES INVESTMENT TRUST

ACCOUNT APPLICATION FORM

<TABLE>
<CAPTION>
<S><C>
- ----------------------------------------------------------------------------------------------------------------------------------
(A) REGISTRATION (PLEASE PRINT ALL ITEMS EXCEPT SIGNATURES)
(COMPLETE ONE) 1. -
CORPORATIONS, ------------------------------------------------------------------------ -------------------------
PARTNERSHIPS, Name of Corporation or Entity. If a trust, include Name(s) of Trustee(s) Tax I.D. Number
TRUSTS & OTHERS
LINES 1 & 2 2. Type of Registration / / Corporation / / Trust
/ / Partnership / / Other

INDIVIDUAL
USE LINE 3 3. Individual - -
------------------------------------------------------------- --------------------------
First Name Initial Last Name Social Security Number

U.S. Citizen or Resident? Yes / / No / /

JOINT ACCOUNT 4. Joint Names - -
LINES 3 & 4 ------------------------------------------------------------- ---------------------------
First Name Initial Last Name Social Security Number

U.S. Citizen or Resident? Yes / / No / /

GIFT/TRANSFER 5. Uniform Gift/Transfer to Minor as custodian for
TO MINOR ----------------------
LINES 5, 6 & 7 6. under the
------------------------------------------------------- ---------------------------------
Minor's Name Minor's Social Security Number

7. Uniform Gift/Transfer to Minors Act
-------------------------------------------------------
State

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

-----------------------------------------------------------------------------------------------------
(B) MAILING Street or P.O. Box
ADDRESS
-----------------------------------------------------------------------------------------------------
City State Zip Code Home Telephone Daytime Telephone

-----------------------------------------------------------------------------------------------------
DUPLICATE CONFIRMATION/ Street or P.O. Box
STATEMENT SENT TO:
------------------------------------------------------------------------------------------------------
City State Zip Code Home Telephone Daytime Telephone

- -----------------------------------------------------------------------------------------------------------------------------------
(C) FUND For each Fund in which you wish to invest, please enter the amount of your investment and check the
SELECTION & corresponding box.
INITIAL
INVESTMENT MINIMUM INVESTMENT: $250,000 PER FUND. AMOUNT
------
(350) / / Morgan Grenfell International Equity Fund $ _________
(351) / / Morgan Grenfell European Equity Growth Fund $ _________
(352) / / Morgan Grenfell International Small Cap Equity Fund $ _________
(353) / / Morgan Grenfell European Small Cap Equity Fund $ _________
(354) / / Morgan Grenfell Emerging Markets Equity Fund $ _________
(355) / / Morgan Grenfell Global Fixed Income Fund $ _________
(356) / / Morgan Grenfell Emerging Markets Debt Fund $ _________
(357) / / Morgan Grenfell International Fixed Income Fund $ _________
(991) / / Morgan Grenfell Core Global Fixed Income Fund $ _________

/ / Enclosed is my check (payable to the appropriate Fund name) Total $
_________
_________

/ / In order to obtain wiring instructions -- (PLEASE CALL 1-800-407-7301 PRIOR TO SENDING)*

* An account number is necessary prior to wiring money and must be included in instructions and below.

Account Number:
---------------

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

(D) FED WIRE Check one only, if none are / / All redemption proceeds will be sent by Fed wire net of wire
& AUTOMATED checked all redemptions charges unless Morgan Grenfell Investment Trust, P.O. Box
CLEARING HOUSE will be sent by an ACH 419165, Kansas City, MO 64141-6165 is notified in writing to
("ACH") transaction. execute redemptions by ACH transaction.
INFORMATION
/ / All redemption proceeds will be executed by an ACH transaction
unless Fed wire is requested by either calling 1-800-407-7301 or
by notifying Morgan Grenfell Investment Trust, P.O. Box 419165,
Kansas City, MO 64141-6165 in writing. There is no charge for
ACH transactions.

Automated Clearing House (ACH) redemptions must be executed by telephone authorization by calling
1-800-407-7301. Generally the proceeds of redemptions will be deposited in your bank account within
three business days after your call

Shareholders purchasing shares of the Fund(s) by Fed wire must request their bank to transmit the funds
to: United Missouri Bank, N.A.; ABA #10-10-00695; For Account Number 98-7052-395-7; Further Credit
[appropriate Fund name] The shareholder's name and account number must be specified in the wire

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

<PAGE>
- -----------------------------------------------------------------------------------------------------------------------------------

(D) (CONTINUED) All Fed wire and ACH transactions will be sent as indicated below. There will be no charge for ACH
FED WIRE redemptions. Fed wire redemptions will be sent net of wire charges. Any changes in Fed wire or ACH
& AUTOMATED transactions must be made in writing to Morgan Grenfell Investment Trust, P.O. Box 419165, Kansas
CLEARING HOUSE City, MO 64141-6165. Please allow one month for ACH instructions to be effective. All activity
("ACH") prior to ACH instructions being effective will be done by Fed wire
INFORMATION
NOTIFY YOUR BANK OF YOUR INTENT TO ESTABLISH THIS OPTION ON YOUR BANK ACCOUNT.

---------------------------------------------------------------------------------------------------------
Bank Name Branch Office (if applicable)
VOIDED PERSONAL
CHECK MUST BE ---------------------------------------------------------------------------------------------------------
ATTACHED Bank Address (Do not use P.O. Box) City State Zip Code

---------------------------------------------------------------------------------------------------------
Bank Wire Routing Number Name(s) on Your Bank Account Your Bank Account Number

- -----------------------------------------------------------------------------------------------------------------------------------
(E) DIVIDENDS Check one only; if none / / All dividend income and capital gains reinvested
AND are checked all dividend / / All dividend income and capital gains paid by ACH transaction
CAPITAL GAINS income and capital gains, / / Capital gains paid by ACH transaction and dividend income reinvested
DISTRIBUTIONS if any, will be reinvested. / / Dividend income paid by ACH transaction and capital gains reinvested

- -----------------------------------------------------------------------------------------------------------------------------------
(F) TELEPHONE I (We) authorize DST Systems, Inc. to act upon instructions received by telephone from me (us) to redeem
PRIVILEGE shares or to exchange for shares of other Morgan Grenfell Investment Trust. I (We) understand an
REDEMPTION'S; exchange is made by redeeming shares of one Fund and using the proceeds to buy shares of another Fund.
EXCHANGE BETWEEN If there is an exchange, the account registration for the other Fund automatically will be the same as
PORTFOLIOS set forth above. Redemptions proceeds will be sent via ACH transaction, unless I (we) have elected the
Fed wire redemption privilege (Item D).

- -----------------------------------------------------------------------------------------------------------------------------------
(G) CLIENT 1. I (We) have full right, power, authority and legal capacity, and am (are) of legal age in my (our)
AGREEMENT state of residence to purchase shares of the Fund. I (We) affirm that I (we) have received and read the
current prospectus of the Fund and agree to its terms. I (We) understand the investment objectives and
program, and have determined that the Fund is a suitable investment, based upon my (our) investment needs
and financial situation. I (We) agree that DST Systems, Inc. or any of its affiliates, officers,
directors or employees will not be liable for any loss, expense or cost for acting upon any instructions
or inquiries believed genuine.

2. I (We) understand that the authorization(s), with respect to Wire Redemptions are subject to the
conditions and limitations set forth in the current prospectus. I (We) ratify any instructions given,
pursuant to the above authorization(s) and agree that DST Systems, Inc. or any of its affiliates,
officers, directors or employees will not be liable for any loss liability, cost or expense for acting
upon instructions, when believed to be genuine.

3. I (We) understand and acknowledge that a return on the Morgan Grenfell Investment Trust Fund(s) is
(are) not guaranteed.

4. This Agreement shall be governed by the laws of the Commonwealth of Pennsylvania.

5. Morgan Grenfell Inc. has full authority to purchase and redeem shares of the mutual fund portfolios
if full investment discretion has been provided to Morgan Grenfell by a separate agreement.

/ / CHECK THIS BOX IF FULL INVESTMENT DISCRETION HAS BEEN PROVIDED TO MORGAN GRENFELL BY A SEPARATE
AGREEMENT.

- -----------------------------------------------------------------------------------------------------------------------------------
(H) SIGNATURES Taxpayer Identification Number Certification (See Appendices to Prospectus for Instructions).
AND BACK-UP Under the penalties of perjury, I certify the following:
WITHHOLDING
CERTIFICATION 1. The number shown on this form is my correct taxpayer identification number.
2. I am exempt from back-up withholding or I am not subject to backup withholding as a result of
receiving notice from the Internal Revenue Service (IRS) that such withholding applies due to a
failure to report all interest or dividends, or the IRS has notified me that I am no longer subject to
back-up withholding.

The Internal Revenue Service does not require your consent to any provision of this document other than
certifications required to avoid backup withholding.

---------------------------------------------- --------- -------------------------------
Individual (or Custodian) Date Joint Registration, if any

---------------------------------------------- --------- -------------------------------
Corporate Officer, Partner, Trustee, etc. Date Title

* YOU MUST CROSS OUT ITEM 2 ABOVE IF YOU HAVE BEEN NOTIFIED BY THE IRS THAT YOU ARE CURRENTLY SUBJECT TO
BACK-UP WITHHOLDING

- -----------------------------------------------------------------------------------------------------------------------------------
BROKER USE ONLY: DEALER NAME: DEALER NUMBER:
------------------------------------------ ---------------------------------
DEALER ADDRESS:
---------------------------------------

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

REPRESENTATIVE NAME: REPRESENTATIVE BRANCH:
---------------------------------- -------------------------
REPRESENTATIVE SIGNATURE:
------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
MAIL COMPLETED APPLICATION FORM TO: FOR ASSISTANCE CALL:
MORGAN GRENFELL INVESTMENT TRUST 1-800-550-MGAM
P.O. BOX 419165
KANSAS CITY, MO 64141-6165 BEFORE INVESTING, PLEASE READ PROSPECTUS CAREFULLY
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Additional information about a fund's investments is available in the fund's
annual and semi-annual reports to shareholders. In each 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.
The annual report also includes the report of the fund's independent
accountants.

The Statement of Additional Information (SAI) is a supplement to this
prospectus. The SAI contains further information about a fund and its investment
limitations and policies. It also includes the most recent annual report and the
independent accountant's report. A current SAI for the funds is on file with the
Securities and Exchange Commission and is incorporated by reference (is legally
part of this prospectus).

A free copy of the current annual/semi-annual report, the SAI, and other
information and answers to questions about the funds are available by
contacting:

Morgan Grenfell Investment Trust
P.O. Box 419165
Kansas City, MO 64141-6165

Telephone: 1-800-550-6426

Information about a fund (including the SAI) can be reviewed and copied at the
Commission's Public Reference Room in Washington D.C. Information on the
operation of the public reference room may be obtained by calling the Commission
at 1-800-SEC-0330.

Copies of information can be obtained, upon payment of a duplicating fee, by
writing the Public Reference Section of the Commission, Washington, D.C.
20549-6009

Or you can visit the SEC Web site at: www.sec.gov
Registration Number: 811-8006

MG-F-03-0299-01

<PAGE>

MORGAN GRENFELL
INVESTMENT TRUST

Prospectus March 1, 1999

International Mutual Funds
Service Shares

The Securities and Exchange Commission has not approved any fund's shares as
an investment or determined whether this prospectus is accurate or complete.
Any statement to the contrary is a crime.

<PAGE>

MORGAN GRENFELL
INVESTMENT TRUST
SERVICE SHARES

CONTENTS

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

<TABLE>
<CAPTION>
INVESTING IN MORGAN GRENFELL INTERNATIONAL
MUTUAL FUNDS

MORE ABOUT RISK............................... 28

AN OVERVIEW OF SECURITIES THAT MAY BE PURCHASED
AND INVESTMENT TECHNIQUES THAT MAY BE USED BY THE
FUNDS AND THEIR RISKS. INVESTMENT ADVISER
Portfolio Management........................ 30

MANAGING YOUR INVESTMENT
BUYING AND SELLING SHARES
Service Plan................................ 31
Buying and Selling Shares Through Your
Service Organization...................... 31
How Shares are Priced....................... 31
Payment of Redemption Proceeds.............. 31
HOLDING SHARES
Exchanging Shares........................... 32
Dividends and Distributions................. 32
Tax Considerations.......................... 32
FINANCIAL HIGHLIGHTS.......................... 33
POLICIES AND INSTRUCTIONS FOR OPENING, MAINTAINING
AND CLOSING AN ACCOUNT IN ANY FUND.
</TABLE>

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

Prospectus - International Mutual Funds
<PAGE>

Fund Descriptions

WHO MAY WANT TO INVEST
- --------------------------------------------------------------------------------

WHO MAY WANT TO INVEST IN THE EQUITY FUNDS:

WHO MAY NOT WANT TO INVEST IN THE EQUITY FUNDS:

WHO MAY WANT TO INVEST IN THE FIXED INCOME FUNDS:

WHO MAY NOT WANT TO INVEST IN THE FIXED INCOME FUNDS:

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

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

1 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SELECT EQUITY FUND

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

(FORMERLY INTERNATIONAL EQUITY FUND)

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of foreign issuers.

PRINCIPAL HOLDINGS

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

2 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

INTERNATIONAL SELECT EQUITY FUND (CONTINUED)

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

Service class shares have no prior performance history. The bar chart indicates
the risks of investing in the fund by showing changes in the performance of
institutional class shares from year to year. The table shows how the average
annual total returns of the fund's institutional class shares for different
calendar years compare to the return of the Morgan Stanley MSCI EAFE Index.
Institutional class shares are not offered in this prospectus, but service class
shares would have had substantially similar performance over the periods shown.
Institutional and service class shares are invested in the same portfolio of
securities, and the two classes' annual returns would differ only to the extent
service class shares have higher expenses. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/96 10.31%
Dec/31/97 0.51%
Dec/31/98 23.49%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 22.48% in 4th quarter 1998
Lowest: -15.37% in 3rd quarter 1998

SHAREHOLDER EXPENSES

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

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ .70%
Shareholder Service Fee.................. .25%
Other Expenses........................... 2.19%
Total Annual Fund Operating Expenses..... 3.14%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... .70%
Shareholder Service Fee........................... .25%
Other Expenses.................................... 2.19%
Reimbursements.................................... -1.99%
Total Annual Fund Operating Expenses.............. 1.15%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:
- - You invest $10,000 in the fund for the time periods indicated;

- -The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 317 $ 969
</TABLE>

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

3 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL EQUITY FUND
- ----------------------------------------

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of companies located throughout the world.

The team will seek companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

4 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

GLOBAL EQUITY FUND (CONTINUED)
- --------------------------------------------------------------------------------

SHAREHOLDER EXPENSES
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None

Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ .70%
Shareholder Service Fee.................. .25%
Other Expenses........................... .70%
Total Annual Fund Operating Expenses..... 1.65%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... .70%
Shareholder Service Fee........................... .25%
Other Expenses.................................... .70%
Reimbursements.................................... -.50%
Total Annual Fund Operating Expenses.............. 1.15%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 168 $ 520
</TABLE>

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

5 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN EQUITY GROWTH FUND
- ----------------------------------------

(FORMERLY EUROPEAN EQUITY FUND)

INVESTMENT OBJECTIVE AND STRATEGY

The fund seeks capital appreciation. To pursue this objective, the fund invests
primarily in equity securities of companies located in Europe.

The team seeks companies with above average earnings growth, below average
price-to-earnings ratios, leading or dominant positions in their particular
markets and high quality management.

PRINCIPAL HOLDINGS

INVESTMENT RISKS

You could lose money on your investment in the fund or the fund may not perform
as well as other investments due to the following:

RISKS OF FOREIGN INVESTING. Foreign investing involves higher risks than
investing in U.S. markets because the value of the fund depends in part upon
currency exchange rates, political and regulatory environments and overall
economic factors in the countries in which the fund invests. Since the fund may
concentrate its investments in euro denominated issues, as well as in the United
Kingdom, the fund could be particularly susceptible to the effects of political
and economic developments in these regions.

The value of the fund's shares depends in part on the adviser's ability to
assess economic conditions and investment opportunities.

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

6 Prospectus - International Mutual Funds
<PAGE>
Fund Descriptions

EUROPEAN EQUITY GROWTH FUND (CONTINUED)
- --------------------------------------------------------------------------------

Service class shares have no prior performance history. The bar chart indicates
the risks of investing in the fund by showing changes in the performance of
institutional class shares from year to year. The table shows how the average
annual total returns of the fund's institutional class shares for different
calendar years compare to the return of the Morgan Stanley MSCI Europe Index.
Institutional class shares are not offered in this prospectus, but service class
shares would have had substantially similar performance over the periods shown.
Institutional and service class shares are invested in the same portfolio of
securities, and the two classes' annual returns would differ only to the extent
service class shares have higher expenses. How the fund has performed in the
past is not necessarily an indication of how the fund will perform in the
future.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
DECEMBER 31
<S> <C>
Dec/31/97 15.54%
Dec/31/98 22.89%
(% RETURN)
</TABLE>

The bar chart shows the changes in the performance of the fund for each full
calendar year since inception.

Quarterly returns:
Highest: 20.70% in 1st quarter 1998
Lowest: -16.78% in 3rd quarter 1998

AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
PAST SINCE
ONE INCEPT-
YEAR ION
<S> <C> <C>
Morgan Grenfell European Equity Growth,
Institutional Shares 22.89% 23.48%
Morgan Stanley MSCI Europe Index 28.91% 28.75%
</TABLE>

SHAREHOLDER EXPENSES

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

<TABLE>
<S> <C>
Shareholder Fees (fees paid directly from
your investment)
(% of offering price)
Maximum Front-End Sales Charge........... None
Maximum Deferred Sales Charge............ None
Annual Fund Operating Expenses* (expenses
that are deducted from fund assets)
(% of average net assets)
Advisory Fees............................ .70%
Shareholder Service Fee.................. .25%
Other Expenses........................... .43%
Total Annual Fund Operating Expenses..... 1.38%
</TABLE>

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

<TABLE>
<S> <C>
Annual Fund Operating Expenses (% of average net assets)
Advisory Fees..................................... .70%
Shareholder Service Fee........................... .25%
Other Expenses.................................... .43%
Reimbursements.................................... -.23%
Total Annual Fund Operating Expenses.............. 1.15%
</TABLE>

Example
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.

The example assumes:

- - You invest $10,000 in the fund for the time periods indicated;

- - The example also assumes that your investment has a 5% return each year; and

- - The fund's gross operating expenses remain the same.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
<S> <C> <C>
With or without redemption $ 140 $ 437
</TABLE>