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SHORT-TERM INVESTMENTS CO.
PRIME PORTFOLIO
INSTITUTIONAL CLASS
Supplement dated October 18, 1996
to the Prospectus dated December 12, 1995
The first paragraph under the caption "Investment Program - Investment
Policies" on page 6 is revised to read in its entirety as follows:
"The Portfolio may invest in a broad range of government, bank and
commercial obligations and taxable municipal securities that may be
available in the money markets. Such obligations are collectively
referred to as "Money Market Obligations" and include U.S. Treasury
obligations, which include Treasury bills, notes and bonds, and
repurchase agreements relating to such securities. The Portfolio may
also engage in certain investment practices described below. The
market values of the money market instruments held by the Portfolio
will be affected by changes in the yields available on similar
securities. If yields have increased since a security was purchased,
the market value of such security will generally have decreased.
Conversely, if yields have decreased, the market value of such
security will generally have increased."
