FIRSTHAND FUNDS, 485BPOS, 2000-11-30

FIRSTHAND FUNDS
485BPOS, 2000-11-30

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 30, 2000

FILE NOS. 33-73832
811-8268

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

POST-EFFECTIVE AMENDMENT NO. 15

AND/OR

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]

AMENDMENT NO. 20

FIRSTHAND FUNDS
(Exact name of Registrant as Specified in Charter)

125 SOUTH MARKET, SUITE 1200, SAN JOSE, CALIFORNIA 95113
(Address of Principal Executive Offices)

(408) 294-2200
Registrant's Telephone Number, including Area Code

KEVIN M. LANDIS
FIRSTHAND CAPITAL MANAGEMENT, INC.
125 SOUTH MARKET, SUITE 1200, SAN JOSE, CALIFORNIA 95113
(Name and Address of Agent for Service)

Copies of all communications to:
KELVIN K. LEUNG
FIRSTHAND CAPITAL MANAGEMENT, INC.
125 SOUTH MARKET, SUITE 1200, SAN JOSE, CALIFORNIA 95113

JULIE TEDESCO
STATE STREET BANK AND TRUST COMPANY
LAFAYETTE CORPORATE CENTER, 2 AVENUE DE LAFAYETTE, 4TH FL., BOSTON, MA 02111

STEVEN G. CRAVATH
MORRISON & FOERSTER LLP
2000 PENNSYLVANIA AVENUE, NW, WASHINGTON, DC 20006-1888

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

[X] immediately upon filing pursuant to paragraph (b) of Rule 485
[ ] on _______________ pursuant to paragraph (b) of Rule 485
[ ] 75 days after filing pursuant to paragraph (a)(2) of Rule 485
[ ] on _______________ pursuant to paragraph (a)(2) of Rule 485

<PAGE>

PROSPECTUS

[LOGO]FIRSTHAND-Registered Trademark- FUNDS

TECHNOLOGY VALUE FUND-Registered Trademark-
TECHNOLOGY LEADERS FUND
TECHNOLOGY INNOVATORS FUND
THE COMMUNICATIONS FUND-TM-
THE E-COMMERCE FUND-TM-

GLOBAL TECHNOLOGY FUND

NOVEMBER 30, 2000

FIRSTHAND FUNDS HAS REGISTERED EACH MUTUAL FUND OFFERED IN THIS PROSPECTUS WITH
THE U.S. SECURITIES AND EXCHANGE COMMISSION (THE "SEC"). THAT REGISTRATION DOES
NOT IMPLY, HOWEVER, THAT THE SEC ENDORSES THE FUNDS.

AN INVESTMENT IN THE FUNDS IS NOT A DEPOSIT OF A BANK AND IS NOT GUARANTEED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.

THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<PAGE>

THIS PROSPECTUS CONTAINS IMPORTANT INFORMATION ABOUT THE INVESTMENT OBJECTIVE,
STRATEGIES AND RISKS OF EACH FUND THAT YOU SHOULD KNOW ABOUT BEFORE YOU INVEST
IN A FUND. PLEASE READ THIS PROSPECTUS CAREFULLY AND KEEP IT WITH YOUR
INVESTMENT RECORDS. EACH OF THE FUNDS IS NON-DIVERSIFIED AND HAS AS ITS
INVESTMENT OBJECTIVE LONG-TERM GROWTH OF CAPITAL.

IF YOU PURCHASE SHARES OF A FUND THROUGH THE TRANSFER AGENT, THE INITIAL MINIMUM
INVESTMENT IS $10,000, EXCEPT FOR CERTAIN RETIREMENT ACCOUNTS. FOR INDIVIDUAL
RETIREMENT ACCOUNTS (IRAS), ROTH IRAS AND 403(b) ACCOUNTS, THE INITIAL MINIMUM
INVESTMENT IS $2,000. FOR EDUCATION IRAS, THE INITIAL MINIMUM INVESTMENT IS
$500. FOR ALL OTHER RETIREMENT ACCOUNTS, THE INITIAL MINIMUM INVESTMENT IS
$10,000. LOWER MINIMUMS MAY BE AVAILABLE TO YOU IF YOU PURCHASE SHARES OF A FUND
THROUGH A BROKERAGE FIRM. FOR MORE INFORMATION ON PURCHASING SHARES, PLEASE SEE
"HOW TO PURCHASE SHARES" IN THIS PROSPECTUS.

<PAGE>

CONTENTS

Technology Value Fund 2
-----------------------------------------------------------------------
Technology Leaders Fund 6
-----------------------------------------------------------------------
Technology Innovators Fund 10
-----------------------------------------------------------------------
The Communications Fund 14
-----------------------------------------------------------------------
The e-Commerce Fund 18
-----------------------------------------------------------------------
Global Technology Fund 22
-----------------------------------------------------------------------
Additional Investment Techniques and Strategies 26
-----------------------------------------------------------------------
Additional Risk Considerations 27
-----------------------------------------------------------------------
Portfolio Management 29
-----------------------------------------------------------------------
Operation of the Funds 30
-----------------------------------------------------------------------
How to Purchase Shares 31
-----------------------------------------------------------------------
How to Redeem Shares 33
-----------------------------------------------------------------------
Shareholder Services 36
-----------------------------------------------------------------------
Exchange Privileges 37
-----------------------------------------------------------------------
Fund Distributions 39
-----------------------------------------------------------------------
Taxes 39
-----------------------------------------------------------------------
Calculation of Share Price 40
-----------------------------------------------------------------------
Financial Highlights 41
-----------------------------------------------------------------------

CALL TOLL-FREE 1.888.884.2675 Prospectus|1
<PAGE>

TECHNOLOGY VALUE FUND-Registered Trademark-(TVFQX)

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in securities of companies in the high technology field that Firsthand Capital
Management, Inc., (the "Investment Adviser") considers to be undervalued and
have potential for capital appreciation.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

The return on and value of an investment in the Fund will fluctuate in response
to stock market movements. Stocks and other equity securities are subject to
market risks and fluctuations in value due to earnings, economic conditions and
other factors beyond the control of the Investment Adviser. As a result, there
is a risk that you could lose money by investing in the Fund.

2|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

be highly volatile. The value of such investments can, and often does, fluctuate
dramatically and may expose you to greater than average financial and market
risk.

The Fund may also invest in equity securities issued by smaller companies and in
initial public offerings, which typically have additional risks. Smaller
companies may have more-limited product lines, markets and financial resources
than larger, more-seasoned companies and their securities may trade less
frequently and in more-limited volume than those of larger, more-mature
companies. Investments in initial public offerings may result in higher
transaction costs and the realization of short-term gains.

By investing in foreign stocks, the Fund exposes shareholders to additional
risks. Foreign stock markets tend to be more volatile than the U.S. market due
to economic and political instability and regulatory conditions in some
countries. In addition, some of the securities in which the Fund may invest may
be denominated in foreign currencies, whose value may decline against the U.S.
dollar.

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

From time to time the Fund may close and reopen to new and/or existing investors
at the Investment Adviser's discretion.

CALL TOLL-FREE 1.888.884.2675 Prospectus|3
<PAGE>

PAST FUND PERFORMANCE

The bar chart and performance table shown below provide an indication of the
risks of investing in the Fund by showing the changes in the performance of the
Fund from year to year since the Fund's inception and by showing how the average
annual returns of the Fund compare to those of broad-based market indices. How
the Fund has performed in the past cannot guarantee how the Fund will perform in
the future.

[CHART]

During the periods shown in the bar chart, the highest return for a quarter was
60.64% during the quarter ended December 31, 1998, and the lowest return for a
quarter was -29.68% during the quarter ended September 30, 1998.

AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED DECEMBER 31, 1999

One Year 5 Years Since Effectiveness*
-----------------------------------------------------------------------
<S> <C> <C> <C>
Technology Value Fund 190.40% 58.15% 59.19%
Dow Jones Industrial Average (1) 27.01% 26.79% 27.26%
Standard & Poor's 500 Index (2) 20.89% 28.24% 28.51%
NASDAQ Composite Index (3) 85.95% 40.63% 41.11%
</TABLE>

* Performance since public offering of shares of the Fund, which
commenced on December 15, 1994. The Fund's average annual total
return since its inception (commencement of operation) on May 20,
1994 is 56.53%.

(1) The Dow Jones Industrial Average is a measurement of general market
price movement for 30 widely held stocks listed primarily on the New
York Stock Exchange.

(2) The Standard & Poor's 500 Index is a widely recognized, unmanaged
index of common stock prices.

(3) The NASDAQ Composite Index is an unmanaged index representative of
a broad basket of stocks.

4|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
---------------------------------------------------------------------
<S> <C>
Sales load imposed on purchases None
Sales load imposed on reinvested distributions None
Deferred sales load None
Exchange fee None
Redemption fee 2.00%*
</TABLE>

* A redemption fee of 2.00% will be charged on investments held for
less than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the
Fund. Such fees will be paid to the Fund. A wire transfer fee is
charged by the Fund's Transfer Agent for redemptions paid by wire.
This fee is currently $8.

ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
---------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses 0.41%*
Total annual fund operating expenses 1.91%*
</TABLE>

* Pursuant to the terms of the Advisory Agreement, the Investment
Adviser has agreed to reduce its fees and/or make expense
reimbursements to the extent necessary to limit the Fund's total
annual operating expenses to 1.95% of the Fund's average daily net
assets up to $200 million, 1.90% of such assets from $200 million to
$500 million, 1.85% of such assets from $500 million to $1 billion,
and 1.80% of such assets in excess of $1 billion.

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. It
assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those
periods. The example also assumes that your investment has a 5%
return each year and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:

1 year..$194 3 years..$599 5 years..$1,030 10 years..$2,224

CALL TOLL-FREE 1.888.884.2675 Prospectus|5
<PAGE>

TECHNOLOGY LEADERS FUND (TLFQX)

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in securities of companies in the high technology field that the Investment
Adviser considers to have the strongest competitive position. In assessing the
strength of a company's competitive position, the Investment Adviser may
consider such factors as technology leadership, market share, patents and other
intellectual property, strength of management, marketing prowess, and product
development capabilities. The high technology field consists of many high
technology industries including the semiconductor, computer, computer
peripheral, software, telecommunications and mass storage device industries. We
collectively call these six industries the "target group" of high technology
industries.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

6|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

control of the Investment Adviser. As a result, there is a risk that you could
lose money by investing in the Fund.

Because the Fund is non-diversified, it invests in fewer issuers, and is subject
to greater risk than a diversified fund. The Fund is also subject to greater
risk because of its concentration of investments in technology companies, the
market value of which can be highly volatile. The value of such investments can,
and often does, fluctuate dramatically and may expose you to greater than
average financial and market risk.

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

From time to time the Fund may close and reopen to new and/or existing investors
at the Investment Adviser's discretion.

CALL TOLL-FREE 1.888.884.2675 Prospectus|7
<PAGE>

PAST FUND PERFORMANCE

[CHART]

During the period shown in the bar chart, the highest return for a quarter was
58.90% during the quarter ended December 31, 1998, and the lowest return for a
quarter was -12.62% during the quarter ended September 30, 1998.

AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 1999

<TABLE>
<CAPTION>
One Year Since Inception*
---------------------------------------------------------------------
<S> <C> <C>
Technology Leaders Fund 152.58% 108.22%
Dow Jones Industrial Average (1) 27.01% 20.88%
Standard & Poor's 500 Index (2) 20.89% 23.68%
NASDAQ Composite Index (3) 85.95% 56.83%
</TABLE>

* Performance since public offering of shares of the Fund, which
commenced on December 10, 1997.

(1) The Dow Jones Industrial Average is a measurement of general market
price movement for 30 widely held stocks listed primarily on the
New York Stock Exchange.

(2) The Standard & Poor's 500 Index is a widely recognized, unmanaged
index of common stock prices.

(3) The NASDAQ Composite Index is an unmanaged index representative of
a broad basket of stocks.

8|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

<TABLE>
<CAPTION>
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
------------------------------------------------------------------
<S> <C>
Sales load imposed on purchases None
Sales load imposed on reinvested distributions None
Deferred sales load None
Exchange fee None
Redemption fee 2.00%*
</TABLE>

* A redemption fee of 2.00% will be charged on investments held for
less than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the Fund.
Such fees will be paid to the Fund. A wire transfer fee is charged by
the Fund's Transfer Agent for redemptions paid by wire. This fee is
currently $8.

ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses 0.44%*
Total annual fund operating expenses 1.94%*
</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. It
assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those
periods. The example also assumes that your investment has a 5%
return each year and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:

1 year...$197 3 years...$609 5 years...$1,045 10 years...$2,255

CALL TOLL-FREE 1.888.884.2675 Prospectus|9
<PAGE>

TECHNOLOGY INNOVATORS FUND (TIFQX)

CURRENTLY CLOSED TO NEW INVESTORS.*

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in securities of companies in the high technology field that the Investment
Adviser considers to be best positioned to introduce successful new products. In
assessing a company's capacity for innovation, the Investment Adviser may
consider a number of factors, including technical vision, marketing acumen,
proprietary technological advantages and a demonstrated ability to bring
products to market quickly. The high technology field consists of many high
technology industries including the semiconductor, computer, computer
peripheral, software, telecommunications and mass storage device industries. We
collectively call these six industries the "target group" of high technology
industries.

The Investment Adviser's analysis of a potential investment will focus on
valuing a company and purchasing securities of the company when the Investment
Adviser believes that its value exceeds the market price. In assessing a
company's potential, the Investment Adviser may consider a number of factors,
including technical vision, marketing acumen, proprietary technological
advantages and the company's ability to rapidly respond to changing market
conditions.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

10|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

* From time to time, the Fund may reopen and close to new and/or existing
investors at the Investment Adviser's discretion. Existing shareholders may make
additional investments into their existing accounts or may open new accounts.
Please be advised that if you redeem your total investment in the Fund, your
account will be closed and you will not be able to make additional investments
in the Fund.

CALL TOLL-FREE 1.888.884.2675 Prospectus|11
<PAGE>

PAST FUND PERFORMANCE

[CHART]

During the period shown in the bar chart, the highest return for a quarter was
54.79% during the quarter ended December 31, 1999, and the lowest return for a
quarter was 15.21% during the quarter ended September 30, 1999.

AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 1999

<TABLE>
<CAPTION>
One Year Since Inception*
----------------------------------------------------------------------
<S> <C> <C>
Technology Innovators Fund 212.34% 170.21%
Dow Jones Industrial Average (1) 27.01% 17.83%
Standard & Poor's 500 Index (2) 20.89% 20.54%
NASDAQ Composite Index (3) 85.95% 63.47%
</TABLE>

* Performance since public offering of shares of the Fund, which
commenced on May 20, 1998.

(1) The Dow Jones Industrial Average is a measurement of general market
price movement for 30 widely held stocks listed primarily on the New
York Stock Exchange.

(2) The Standard & Poor's 500 Index is a widely recognized, unmanaged
index of common stock prices.

(3) The NASDAQ Composite Index is an unmanaged index representative of a
broad basket of stocks.

12|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

<TABLE>
<CAPTION>
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
---------------------------------------------------------------------
<S> <C>
Sales load imposed on purchases None
Sales load imposed on reinvested distributions None
Deferred sales load None
Exchange fee None
Redemption fee 2.00%*
</TABLE>

* A redemption fee of 2.00% will be charged on investments held for less
than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the Fund.
Such fees will be paid to the Fund. A wire transfer fee is charged by
the Fund's Transfer Agent for redemptions paid by wire. This fee is
currently $8.

ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
---------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses 0.43%*
Total annual fund operating expenses 1.93%*
</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. It assumes
that you invest $10,000 in the Fund for the time periods indicated and
then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year
and that the Fund's operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your
costs would be:

1 year...$196 3 years...$605 5 years...$1,040 10 years...$2,245

CALL TOLL-FREE 1.888.884.2675 Prospectus|13
<PAGE>

THE COMMUNICATIONS FUND-TM- (TCFQX)

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in securities of companies, both domestic and foreign, that the Investment
Adviser considers to be best positioned to benefit significantly from their
involvement in, or support of, the communications industry. The Fund considers
the communications industry to include companies that engage in designing,
developing, operating, financing, manufacturing or providing the following
activities, products and services: communications equipment and service;
electronic components and equipment; broadcast; computer equipment; mobile
communications; electronic mail; local and wide area networking; publishing and
information systems; video; photonics; and emerging technologies combining
telephone, television and/or computer systems.

The Investment Adviser's analysis of a potential investment will focus on
valuing a company and purchasing securities of the company when the Investment
Adviser believes its value exceeds the market price. In assessing a company's
potential, the Investment Adviser may consider a number of factors, including
technical vision, marketing acumen, proprietary technological advantages and the
company's ability to rapidly respond to changing market conditions.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

14|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

control of the Investment Adviser. As a result, there is a risk that you could
lose money by investing in the Fund.

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

From time to time the Fund may close and reopen to new and/or existing investors
at the Investment Adviser's discretion.

PAST FUND PERFORMANCE

The fund was launched on September 30, 1999. Performance results have not been
provided because the Fund has not yet been in existence for a full calendar
year.

CALL TOLL-FREE 1.888.884.2675 Prospectus|15
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

* A redemption fee of 2.00% will be charged on investments held for
less than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the Fund.
Such fees will be paid to the Fund. A wire transfer fee is charged by
the Fund's Transfer Agent for redemptions paid by wire. This fee is
currently $8.

ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
---------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses* 0.45%**
Total annual fund operating expenses* 1.95%**
</TABLE>

* Other expenses and total annual fund operating expenses are based on
estimates for the current fiscal year.

** Pursuant to the terms of the Advisory Agreement, the Investment
Adviser has agreed to reduce its fees and/or make expense
reimbursements to the extent necessary to limit the Fund's total
annual operating expenses to 1.95% of the Fund's average daily net
assets up to $200 million, 1.90% of such assets from $200 million to
$500 million, 1.85% of such assets from $500 million to $1 billion,
and 1.80% of such assets in excess of $1 billion.

16|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

1 year...$198 3 years...$612 5 years...$1,050 10 years...$2,266

CALL TOLL-FREE 1.888.884.2675 Prospectus|17
<PAGE>

THE E-COMMERCE FUND-TM- (TEFQX)

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in securities of companies, both domestic and foreign, that the Investment
Adviser considers to be best positioned to benefit significantly from their
involvement in or support of electronic commerce (e-commerce). The Fund
considers eligible companies to be those that engage in designing, developing,
operating, financing, manufacturing or providing the following activities,
products and services: internet access, equipment and service; electronic
components and equipment; commerce infrastructure tools such as security and
payment systems; computers; software tools and utilities; electronic
communications; web presence/solution providers; local and wide area networking;
publishing and information systems; and emerging technologies combining
communications, commerce, media and/or computer systems.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

The return on and value of an investment in the Fund will fluctuate in response
to stock market movements. Stocks and other equity securities are subject to
market risks and

18|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

fluctuations in value due to earnings, economic conditions and other factors
beyond the control of the Investment Adviser. As a result, there is a risk that
you could lose money by investing in the Fund.

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

From time to time the Fund may close and reopen to new and/or existing investors
at the Investment Adviser's discretion.

PAST FUND PERFORMANCE

The Fund was launched on September 30, 1999. Performance results have not been
provided because the Fund has not yet been in existence for a full calendar
year.

CALL TOLL-FREE 1.888.884.2675 Prospectus|19
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

<TABLE>
<CAPTION>
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
--------------------------------------------------------------------
<S> <C>
Sales load imposed on purchases None
Sales load imposed on reinvested distributions None
Deferred sales load None
Exchange fee None
Redemption fee 2.00%*
</TABLE>

* A redemption fee of 2.00% will be charged on investments held for
less than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the Fund.
Such fees will be paid to the Fund. A wire transfer fee is charged by
the Fund's Transfer Agent for redemptions paid by wire. This fee is
currently $8.

ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
--------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses* 0.45%**
Total annual fund operating expenses* 1.95%**
</TABLE>

* Other expenses and total annual fund operating expenses are based on
estimates for the current fiscal year.

20|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

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. It
assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those
periods. The example also assumes that your investment has a 5%
return each year and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:

1 year...$198 3 years...$612 5 years...$1,050 10 years...$2,266

CALL TOLL-FREE 1.888.884.2675 Prospectus|21
<PAGE>

GLOBAL TECHNOLOGY FUND (GTFQX)

OBJECTIVE

The Fund seeks long-term growth of capital.

PRINCIPAL STRATEGY

The Fund seeks to achieve its objective by investing at least 65% of its assets
in equity securities of companies in the high technology field, both domestic
and foreign, that the Investment Adviser considers to be best positioned to
benefit significantly from the adoption of new technologies worldwide. At any
point in time the Fund may invest a portion or all of its assets in either
domestic or foreign-based companies.

The Investment Adviser's analysis of a potential investment will focus on
valuing a company and purchasing securities of the company when the Investment
Adviser believes the value exceeds its market price. In assessing a company's
potential, the Investment Adviser may consider a number of factors, including
technical vision, marketing acumen, proprietary technological advantages, the
company's ability to rapidly respond to changing market conditions, and the
opportunity for the global application of the company's products or services.
The high technology field consists of many high technology industries including
the semiconductor, computer, computer peripheral, software, telecommunication
and mass storage device industries. We collectively call these six industries
the "target group" of high technology industries.

Although some of the Fund's holdings may produce dividends, interest or other
income, current income is not a consideration in selecting the Fund's
investments.

PLEASE SEE "ADDITIONAL INVESTMENT TECHNIQUES AND STRATEGIES" FOR FURTHER
INFORMATION.

PRINCIPAL RISKS

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<PAGE>

Because the Fund is non-diversified, it invests in fewer issuers, and is subject
to greater risk than a diversified fund. The Fund is also subject to greater
risk because of its concentration of investments in technology companies, the
market value of which can be highly volatile. The market value of such
investments can, and often does, fluctuate dramatically and may expose you to
greater than average financial and market risk.

PLEASE SEE "ADDITIONAL RISK CONSIDERATIONS" FOR FURTHER INFORMATION.

From time to time the Fund may close and reopen to new and/or existing investors
at the Investment Adviser's discretion.

PAST FUND PERFORMANCE

The Fund was launched on September 29, 2000. Performance results are not
provided because the Fund has not yet been in existence for a full calendar
year.

CALL TOLL-FREE 1.888.884.2675 Prospectus|23
<PAGE>

EXPENSE INFORMATION

The following table shows the fees and expenses you may pay if you buy and hold
shares of this Fund.

* A redemption fee of 2.00% will be charged on investments held for
less than 180 days. For this purpose, an exchange out of a Fund into
another mutual fund is considered a redemption of shares of the Fund.
Such fees will be paid to the Fund. A wire transfer fee is charged by
the Fund's Transfer Agent for redemptions paid by wire. This fee is
currently $8.

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
---------------------------------------------------------------------
<S> <C>
Management fee 1.50%
Distribution (12b-1) fee None
Other expenses* 0.45%**
Total annual fund operating expenses* 1.95%**
</TABLE>

* Other expenses and total annual fund operating expenses are based on
estimates for the current fiscal year.

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<PAGE>

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. It
assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those
periods. The example also assumes that your investment has a 5%
return each year and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:

1 year...$1983 years...$612 5 years...$1,050 10 years...$2,266

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<PAGE>

ADDITIONAL INVESTMENT
TECHNIQUES AND STRATEGIES

The equity securities in which each Fund may invest include common stock,
convertible long-term corporate debt obligations, preferred stock, convertible
preferred stock and warrants. The securities selected will typically be traded
on a national securities exchange, the NASDAQ system or over-the-counter, and
may include securities of both large, well-known companies as well as smaller,
less well-known companies, and foreign securities listed on a foreign securities
exchange or traded in the U.S. Each Fund may invest up to 15% of its net assets
in illiquid securities.

The Investment Adviser's analysis of a potential investment for a Fund will
focus on valuing a company and purchasing securities of a company when the
Investment Adviser believes that value exceeds the market price. The Investment
Adviser intends to focus on the fundamental worth of the companies under
consideration. Fundamental worth is defined as the value of the basic businesses
of a company, including products, technologies, customer relationships and other
sustainable competitive advantages. For purposes of the Investment Adviser's
analysis, fundamental worth is a reflection of the value of a company's assets
and its earning power, and may be determined by use of price-earnings ratios and
comparison with sales of comparable assets to independent third-party buyers in
arms' length transactions. Balance sheet strength, the ability to generate
earnings and a strong competitive position are the major factors the Investment
Adviser uses when appraising a potential investment. Applicable price-earnings
ratios depend on the earnings potential of a company as determined by the
Investment Adviser. For example, a company that is a relatively high-growth
company normally commands a higher price-earnings ratio than lower growth
companies because future profits of a high-growth company are expected to be
higher than those of a lower growth company.

The Investment Adviser may sell a security when there is a negative development
in the company's competitive, regulatory or economic environment, when the
company's growth prospects or financial situation are deteriorating, when the
Investment Adviser believes a security is overvalued or when other investments
are more attractive, or for other reasons.

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<PAGE>

Each Fund may purchase shares in initial public offerings ("IPOs"). Because IPO
shares frequently are volatile in price, a Fund may hold IPO shares for a very
short period of time. This may increase the turnover of a Fund's portfolio and
may lead to increased expenses to a Fund, such as commissions and transaction
costs. When it sells shares, a Fund may realize taxable capital gains that it
will subsequently distribute to shareholders.

ADDITIONAL
RISK CONSIDERATIONS

EQUITY SECURITIES. Each Fund invests primarily in equity securities, which, by
definition, entail risk of loss of capital. Investments in equity securities are
subject to inherent market risks and fluctuation in value due to earnings,
economic conditions and other factors beyond the control of the Investment
Adviser. Securities in a Fund's portfolio may not increase as much as the market
as a whole and some undervalued securities may continue to be undervalued for
long periods of time. Some securities may be inactively traded, and may be
difficult to sell. Although profits in some of a Fund's holdings may be realized
quickly, it is not expected that most of a Fund's investments will appreciate
rapidly.

SMALL CAPITALIZATION COMPANIES. Each Fund may, from time to time, invest a
substantial portion of its assets in small capitalization companies. Although
smaller companies often have potential for rapid growth, investment in them
frequently involves greater risks because these companies may lack the
management experience, financial resources, product diversification and
competitive strengths of larger companies. In addition, in many instances, the
securities of smaller companies are traded only over-the-counter or on a
regional securities exchange, and the frequency and volume of their trading is
substantially less than is typical of larger companies. These factors make the
securities of smaller companies subject to wider price fluctuations. When making
large sales of securities of smaller companies that have smaller trading
volumes, a Fund may

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<PAGE>

have to sell portfolio holdings at discounts from quoted prices or it may have
to make a series of small sales over an extended period of time.

FOREIGN SECURITIES. Each Fund may purchase foreign securities that are listed on
a foreign securities exchange, on a foreign over-the-counter market, or which
are represented by American Depositary Receipts that are listed on a domestic
securities exchange or traded in the U.S. on an over-the-counter market. Foreign
investments may be subject to risks that are not typically associated with
investments in domestic companies. For example, foreign investments may be
adversely affected by changes in currency rates and exchange control
regulations, future political and economic developments, the possibility of
seizure or nationalization of companies or foreign assets, or the imposition of
withholding and other taxes.

TEMPORARY DEFENSIVE MEASURES. For defensive purposes, each Fund may temporarily
hold all or a portion of its assets in cash or money market instruments. Such
action may help a Fund minimize or avoid losses during adverse market, economic
or political conditions. During such a period, a Fund may not achieve its
investment objective. For example, if the market advances during this period, a
Fund may not participate as much as it would have if it had been more fully
invested.

CONCENTRATION OF INVESTMENTS IN THE "TARGET GROUP" OF HIGH TECHNOLOGY
INDUSTRIES. Each Fund concentrates its investments primarily in companies within
the target group of high technology industries (see list below). A Fund is
subject to greater risk because of this concentration of its investment. For
example, investments in companies in the target group of high technology
industries include the risk that certain high technology products and services
are subject to competitive pressures and aggressive pricing. Investments in
companies that focus on new or unproven high technology products include the
additional risk that the products will not meet expectations or even reach the
marketplace.

Although the Investment Adviser currently believes that investments by the Funds
in certain high technology industries may offer greater opportunities for growth
of capital than investments in other industries, such investments may also
expose investors to

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<PAGE>

greater than average financial and market risk. Accordingly, an investment in a
Fund does not constitute a balanced investment program.

Each of the Funds will invest primarily in one or more of the following
industries within the target group of high technology industries. Because each
Fund is non-diversified, at any point in time, a Fund may invest more than 25%
of its assets in any one of the industries within the group. This will further
increase a Fund's risk and will make the Fund more volatile.

TARGET GROUP OF HIGH TECHNOLOGY INDUSTRIES

- Semiconductor
- Computer
- Computer Peripheral
- Software
- Telecommunication
- Mass Storage Device

- Medical (only for Technology Value Fund)

PORTFOLIO MANAGEMENT

Firsthand Funds (the "Trust") retains Firsthand Capital Management, Inc. (the
"Investment Adviser"), 125 South Market, Suite 1200, San Jose, California 95113,
to manage the investments of each Fund. Kevin M. Landis, who also serves as a
Trustee of the Trust, controls the Investment Adviser. Mr. Landis is the Chief
Investment Officer of the Investment Adviser, a position he has held since 1994.
He has been a portfolio manager of the Technology Value Fund, the Technology
Leaders Fund and the Technology Innovators Fund since their respective
inceptions.

The portfolios of The Communications Fund, The e-Commerce Fund, and the Global
Technology Fund are team managed by the Investment Adviser's Technology Equities
Team.

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<PAGE>

OPERATION OF THE FUNDS

Under the Investment Advisory Agreement (the "Advisory Agreement"), the
Investment Adviser receives from each Fund an advisory fee at the annual rate of
1.50% of its average daily net assets. The Advisory Agreement requires the
Investment Adviser to waive its advisory fees or, if necessary, to reimburse
expenses of a Fund to the extent necessary to limit a Fund's total operating
expenses to 1.95% of its average net assets up to $200 million, 1.90% of such
assets from $200 million to $500 million, 1.85% of such assets from $500 million
to $1 billion, and 1.80% of such assets in excess of $1 billion. During the
fiscal year ended December 31, 1999 the Technology Value Fund, the Technology
Leaders Fund and the Technology Innovators Fund each paid to the Investment
Adviser fees of 1.50% of the Funds' average daily net assets.

The Trust has entered into a separate Administration Agreement (the
"Administration Agreement") with the Investment Adviser. This agreement
obligates the Investment Adviser to provide administrative and general
supervisory services to the Fund. Under the Administration Agreement, the
Investment Adviser oversees the maintenance of all books and records with
respect to a Fund's securities transactions and each Fund's book of accounts in
accordance with all applicable federal and state laws and regulations. The
Investment Adviser also arranges for the preservation of journals, ledgers,
corporate documents, brokerage account records and other records as required by
the Investment Company Act of 1940. The Investment Adviser is responsible for
the equipment, staff, office space and facilities necessary to perform its
obligations under the Administration Agreement. The Investment Adviser has also
assumed responsibility for payment of all of the Fund's operating expenses
except for brokerage and commission expenses, Independent Trustees' compensation
and any extraordinary and non-recurring expenses. For the services it provides
under the Administration Agreement, the Investment Adviser receives a fee from
each Fund at the annual rate of 0.45% of its average daily net assets up to $200
million, 0.40% of such assets from $200 million to $500 million, 0.35% of such
assets from $500 million to $1 billion, and 0.30% of such assets in excess of $1
billion.

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<PAGE>

ALPS Mutual Funds Services, Inc. (the "Underwriter"), a member of the National
Association of Securities Dealers, Inc. ("NASD"), 370 17th Street, Suite 3100,
Denver, Colorado 80202, serves as principal underwriter and distributor for each
Fund and, as such, is the exclusive agent for the distribution of shares of the
Funds.

HOW TO PURCHASE SHARES

You may purchase shares directly through the Funds' transfer agent (the
"Transfer Agent") or through a brokerage firm or financial institution that has
agreed to sell a Fund's shares. If you purchase shares of a Fund through the
transfer agent, the initial minimum investment is $10,000, except for certain
retirement accounts. For Individual Retirement Accounts (IRAs), Roth IRAs,
SIMPLE IRAs and 403(b) accounts, the initial minimum investment is $2,000. For
Education IRAs, the initial minimum investment is $500. For all other retirement
accounts, the initial minimum investment is $10,000. Lower minimums may be
available to you if you purchase shares of a Fund through a brokerage firm.

Shares of each Fund are sold on a continuous basis at the net asset value next
determined after receipt by the Trust, or an agent of the Trust, of your
properly completed purchase order. Any order placed with a brokerage firm is
treated as if it was placed directly with the Trust. Your shares may be held in
a pooled account in your broker's name, and in most instances the broker will
maintain your individual ownership information. Your brokerage firm may charge
you a fee for handling your order. Your brokerage firm is responsible for
processing your order correctly and promptly, keeping you advised of the status
of your individual account, confirming your transactions and ensuring that you
receive copies of the Trust's Prospectus and reports to shareholders. Purchase
orders received by the Transfer Agent or your broker prior to the close of the
regular session of trading on the New York Stock Exchange (the "NYSE") on the
day that you place your order are confirmed at the net asset value determined at
the close of business on that day. If you place your order with a broker, it is
the responsibility of the broker to promptly transmit properly completed orders.

CALL TOLL-FREE 1.888.884.2675 Prospectus|31
<PAGE>

You may open an account and make an initial investment in a Fund through
selected brokerage firms or financial intermediaries, or by sending a check and
a properly completed account application form to Firsthand Funds, P.O. Box 8356,
Boston, Massachusetts 02266-8356. Checks should be made payable to "Firsthand
Funds." Only imprinted checks issued in U.S. dollars drawn on a U.S. bank or
financial institution will be accepted. Third party checks and "starter" checks
will not be accepted.

The Transfer Agent (or your broker) will mail you confirmations of all
purchases or redemptions of Fund shares. Certificates representing shares are
not issued. The Trust reserves the rights to limit the amount of investments
and to refuse to sell to any person.

If your order to purchase shares is cancelled because your check does not clear,
you will be responsible for any resulting losses or fees incurred by the Trust
or the Transfer Agent. We may deduct the losses or fees from your existing
account.

After the Trust receives and accepts your properly completed account application
form, you may purchase shares of a Fund by bank wire. Please telephone the
Transfer Agent (call toll-free 1.888.884.2675) for wire instructions. Be
prepared to give the name of the Fund in which you wish to purchase shares, the
name in which you want the account established, the address, telephone number
and taxpayer identification number for the account, and the name of the bank
that will wire the money. Your investment will be made at the next determined
net asset value after your wire, along with the account information indicated
above, is received. If the Transfer Agent does not receive timely and complete
account information, there may be a delay in the investment of your money and
any accrual of dividends. To make your initial wire purchase, you must mail a
properly completed account application to the Transfer Agent. Your bank may
charge you for sending a wire. There is presently no fee for receipt of wired
funds, but the Transfer Agent reserves the right to charge shareholders for this
service upon thirty days' prior written notice to you.

You may also purchase shares of a Fund by way of an Automated Clearing House
("ACH") transaction, after the Transfer Agent has received and accepted your
properly

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<PAGE>

completed account application form. Please telephone the Transfer Agent (call
toll free 1.888.884.2675) for instructions.

After your initial purchase of a Fund's shares, you may purchase and add shares
to your account ($50 minimum) by mail, ACH or by bank wire. Checks should be
sent to Firsthand Funds, P.O. Box 8356, Boston, Massachusetts 02266-8356. Checks
should be made payable to "Firsthand Funds." Bank wires should be sent as
described above. Each additional purchase request must contain the account name
and number to permit proper crediting.

HOW TO REDEEM SHARES

You may redeem shares of a Fund on each day that the Trust is open for business.
You will receive the net asset value per share next determined after receipt by
the Transfer Agent of your properly completed redemption request. Payment (less
any applicable redemption fees) is normally made within three business days
after the Transfer Agent receives your properly completed redemption request.
Payment for redemptions of shares purchased by check or ACH will be effected
only after the funds have been collected, which may take up to fifteen days from
the purchase date. To eliminate this delay, you may purchase shares of the Fund
by certified check or wire.

BY TELEPHONE. You may redeem shares having a value of less than $50,000 by
telephone. The proceeds will be sent by mail to the address designated on your
account or wired directly to your existing account in any commercial bank or
brokerage firm in the U.S. as designated on your application. To redeem by
telephone, contact the Transfer Agent (call toll-free 1.888.884.2675). The
redemption proceeds (less any applicable redemption fees) will normally be sent
by mail or by wire within three business days after receipt of your telephone
instructions. IRA accounts are not redeemable by telephone.

The telephone redemption privilege is automatically available to all new
accounts. If you do not want the telephone redemption privilege, you must
indicate this in the appropriate area on your account application or you must
write to the Transfer Agent and instruct them to remove this privilege from your
account.

CALL TOLL-FREE 1.888.884.2675 Prospectus|33
<PAGE>

You may change the bank or brokerage account that you designated on your account
application at any time by writing to the Transfer Agent and including your
signature guaranteed by any eligible guarantor institution (which include banks,
brokers-dealers, credit unions, national securities exchanges, registered
securities associations, clearing agencies and savings associations). A notary
public CANNOT provide a signature guarantee. Further documentation will be
required to change the designated account if shares are held by a corporation,
fiduciary, or other organization.

The Transfer Agent reserves the right to suspend the telephone redemption
privilege with respect to any account if the name(s) or the address on the
account has been changed within the previous thirty days.

Neither the Trust, the Transfer Agent, nor their respective affiliates will be
liable for complying with telephone instructions that they reasonably believe to
be genuine or for any loss, damage, cost or expenses in acting on such telephone
instructions. The affected shareholders will bear the risk of any such loss. The
Trust or the Transfer Agent, or both, will employ reasonable procedures to
determine that telephone instructions are genuine. If the Trust and/or the
Transfer Agent do not employ such procedures, they may be liable for losses due
to unauthorized or fraudulent instructions. Reasonable procedures may include
requiring forms of personal identification prior to acting upon telephone
instructions, providing written confirmation of the transactions and/or tape
recording telephone instructions.

BY MAIL. You may redeem any number of shares from your account by sending a
written request to the Transfer Agent. The request must state the number of
shares, or the dollar amount, to be redeemed and your account number. You must
sign your request exactly as your name appears on the Trust's account records.
If the shares you want to redeem have a value of $50,000 or more, your signature
must be guaranteed by any of the eligible guarantor institutions as described in
the previous section. If you change the name(s) or the address on your account
within thirty days of your redemption request, the Transfer Agent will require
you to request the redemption in writing, with your signature guaranteed,
regardless of the value of the shares being redeemed.

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<PAGE>

Written redemption requests may also direct that the proceeds be deposited
directly in the domestic bank or brokerage account you designated on your
account application for telephone redemptions. Proceeds of redemptions requested
by mail are normally mailed within three business days following the receipt of
your properly completed request.

THROUGH BROKER-DEALERS. You may also redeem shares of the Fund held in your name
by a securities broker or dealer by placing a redemption request through that
broker-dealer. Unaffiliated broker-dealers may charge you a fee for this
service. You will receive the net asset value per share next determined after
receipt by the Trust or its agent of your redemption request from that
broker-dealer. Brokers-dealers are responsible for promptly transmitting
redemption orders.

ADDITIONAL REDEMPTION INFORMATION. If you request a redemption by wire, the
proceeds (less any applicable redemption fee) will be wired directly to the U.S.
commercial bank account or U.S. brokerage firm that you designated on your
application. The Fund's Transfer Agent will charge you an $8 wire redemption
processing fee. The Transfer Agent reserves the right to change the processing
fee upon thirty days' prior written notice to you. The Transfer Agent will
deduct all applicable charges from the amount of your redemption proceeds. Your
bank or brokerage firm may also impose a charge for processing the wire. In the
event that a wire transfer of funds is impossible or impractical, your
redemption proceeds will be sent to the designated account by mail.

Redemption requests may direct that the proceeds be deposited directly in your
account with a commercial bank or other depository institution by way of an ACH
transaction. There is currently no charge for ACH transactions. Contact the
Transfer Agent for more information about ACH transactions.

At the discretion of the Trust or the Transfer Agent, corporate investors and
other associations may be required to furnish an appropriate certification
authorizing redemptions. The Trust reserves the right to require you to close
your account, other than an IRA account, if at any time the value of your
shares, as a result of your redemptions (not as a result of a decrease in market
value) falls below $10,000, or such

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<PAGE>

other minimum amount as the Trust may from time to time determine. After
notification to you of the Trust's intention to close your account, you will be
given sixty days to increase the value of your account to the required minimum
amount.

Large redemptions may have a negative impact on the Investment Adviser's ability
to implement a Fund's investment strategy because the portfolio manager may need
to sell securities that would not otherwise be sold in order to meet the
redemption request. If, in any 90-day period, you redeem more than $250,000 or,
your redemption request would amount to more than 1% of a Fund's net assets,
then each Fund has the right to pay the difference between the redemption amount
and the lesser of the two previously mentioned figures with securities from the
Fund (redemption in kind) taken at market value.

The Trust reserves the right to suspend the right of redemption or to postpone
the date of payment for more than three business days under unusual
circumstances as determined by the SEC.

A redemption fee will apply to exchanges and redemptions out of a Fund if the
shares exchanged or redeemed were held for fewer than 180 days. This redemption
fee compensates a Fund for the increased expenses to longer-term shareholders
resulting from the disruptive effect on the portfolio caused by short-term
investments. The redemption fee will be assessed on the net asset value of the
shares redeemed or exchanged and will be deducted from the redemption proceeds
otherwise payable to you. The Fund from which your shares are redeemed or
exchanged will retain the fee charged. Each Fund reserves the right to waive the
redemption fee under certain circumstances.

SHAREHOLDER SERVICES

Contact the Transfer Agent (call toll-free 1.888.884.2675) for additional
information about the shareholder services described below.

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TAX-DEFERRED RETIREMENT PLANS

Shares of each Fund are available for purchase in connection with the following
tax-deferred retirement plans:

- IRA plans for individuals and their non-employed spouses, including Roth
IRAs and Education IRAs

- 403(b)(7) custodial accounts for employees of public school systems,
hospitals, colleges and other non-profit organizations meeting certain
requirements of the Internal Revenue Code of 1986 (the "Code")

DIRECT DEPOSIT PLANS

Shares of a Fund may be purchased through direct deposit plans offered by
certain employers and government agencies. These plans enable you to have all or
a portion of your payroll or Social Security checks transferred automatically to
purchase shares of a Fund.

AUTOMATIC INVESTMENT PLAN

By completing the Automatic Investment Plan section of the account application,
you may make automatic monthly investments in a Fund from your bank, savings and
loan or other depository institution account. The minimum monthly investment
must be $50 under the plan; the applicable initial minimum investment still
applies. The Transfer Agent pays the costs associated with these transfers, but
reserves the right, upon thirty days' prior written notice, to make reasonable
charges for this service. If your depository institution imposes its own charge
for debiting your account, this will reduce your return on your investment in a
Fund. You may change the amount of your automatic investment or discontinue the
plan at any time by writing or calling the Transfer Agent.

EXCHANGE PRIVILEGE

You may exchange shares of a Fund for shares of another Fund or for shares of
the SSgA Money Market Fund (the "Money Market Fund") (a series of SSgA Funds),
at relative

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<PAGE>

net asset value if you have received a prospectus describing such other fund(s).
Shares of the Money Market Fund acquired via exchange may be reexchanged for
shares of any Firsthand Fund at relative net asset value. Redemption fees apply
to exchanged shares that were purchased fewer than 180 days prior to the
exchange. In order to exchange your Fund shares for shares of the Money Market
Fund, you must first read its prospectus and open a separate Money Market Fund
account. To obtain a prospectus and account application for the Money Market
Fund, call 1.888.884.2675.

You may request an exchange by sending a written request to the Transfer Agent.
You must sign your request exactly as your name appears on the Trust's account
records. Exchanges may also be requested by telephone. The Transfer Agent will
effect an exchange at the next determined net asset value after receipt of a
properly completed request. Your request is subject to the Funds' cut-off time,
which is normally 4:00 p.m. eastern time. Requests received by the Transfer
Agent prior to the cut-off time will receive that day's net asset value.
Requests received by the Transfer Agent after the cut-off time will be filled at
the next day's net asset value.

The telephone exchange privilege is automatically available to all shareholders.
Neither the Trust, the Transfer Agent, nor their respective affiliates will be
liable for any loss, damage, cost or expense in acting on such telephone
instructions when complying with telephone instructions they reasonably believe
to be genuine. The affected shareholders will bear the risk of any such loss.
The Trust or the Transfer Agent, or both, will employ reasonable procedures to
determine that telephone instructions are genuine. If the Trust and/or the
Transfer Agent do not employ such procedures, they may be liable for losses due
to unauthorized or fraudulent instructions. These procedures may include, among
others, requiring forms of personal identification prior to acting upon
telephone instructions, providing written confirmation of the transactions
and/or tape recording telephone instructions.

Exchanges may only be made for shares of Funds then offered for sale in your
state of residence and exchanges are subject to the applicable minimum initial
investment requirements. The exchange privilege may be modified or terminated by
the Board of Trustees upon sixty days' prior written notice to shareholders.

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<PAGE>

Exchanges are considered redemptions of the exchanged Fund shares for the
purpose of assessing any applicable redemption fee. Any exchange constitutes a
sale and may be taxable for federal income tax purposes.

FUND DISTRIBUTIONS

Each Fund expects to distribute substantially all of its net investment income
and net realized gains, if any, at least annually. Distributions are
automatically reinvested in additional shares of a Fund on the reinvestment date
(the "Share Option") unless cash payments are specified on your application, or
are otherwise requested by contacting the Transfer Agent. All distributions will
be based on the net asset value in effect on the payable date.

If you elect to receive distributions in cash and the U.S. Postal Service is
unable to deliver your checks, or if your checks remain uncashed for six months,
your distributions may be reinvested in your account at the then-current net
asset value and your account will be converted to the Share Option. No interest
will accrue on amounts represented by uncashed distribution checks.

TAXES

The following discussion regarding taxes is based on the federal income tax laws
that were in effect as of the date of this prospectus and it summarizes only
some of the important federal income tax considerations generally affecting the
Funds and their shareholders. It is not intended as a substitute for careful tax
planning; you should consult your own tax adviser regarding the foreign,
federal, state and local income tax consequences to you of an investment in a
Fund. Further federal income tax considerations are discussed in the Statement
of Additional Information.

Each Fund will distribute substantially all of its income and capital gains.
Distributions of a Fund's net capital gains (generally, the excess of long-term
capital gains over short-term capital losses) will be taxable to you as
long-term capital gains, regardless of the

CALL TOLL-FREE 1.888.884.2675 Prospectus|39

<PAGE>

length of time you have held your Fund shares. Distributions of a Fund's income
from all other sources generally will be taxable to you as ordinary income.
Distributions from a Fund normally will be taxable to you when paid, whether you
automatically reinvest them in additional Fund shares or you elect to take the
distribution in cash.

Redemptions (including redemptions in-kind) and exchanges of a Fund's shares
ordinarily will result in a taxable capital gain or loss, depending on the
amount you receive for your shares (or are deemed to receive in the case of
exchanges) and the amount you paid (or are deemed to have paid) for them. If you
have held your Fund shares for more than one year at the time of redemption or
exchange, such capital gain or loss will be a long-term capital gain or loss.

Foreign shareholders may be subject to different tax treatment, including
withholding taxes. U.S. residents may be subject to backup withholding at a 31%
rate on distributions from and redemption proceeds paid by a Fund.

Each year the Trust will send you a statement indicating the amount and federal
income tax status of all distributions made to you during the previous year.

CALCULATION OF SHARE PRICE

On each day that the Trust is open for business, the share price (net asset
value) of the shares of each Fund is determined as of the close of the regular
session of trading on the NYSE (normally 4:00 p.m., eastern time). The Trust is
open for business on each day the NYSE is open for business. The net asset value
per share of a Fund is calculated by dividing the sum of the value of the
securities held by that Fund plus cash or other assets minus all liabilities
(including estimated accrued expenses) by the total number of shares outstanding
of the Fund, rounded to the nearest cent. The price at which a purchase or
redemption of a Fund's shares is effected is based on the next calculated net
asset value after an order is placed.

40|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

A Fund's portfolio of securities is valued as follows: (1) securities which are
traded on stock exchanges or are quoted by NASDAQ are valued at the last
reported sale price as of the close of the regular session of trading on the
NYSE on the day the securities are being valued, or, if not traded on a
particular day, at the most recent bid price, (2) securities traded in the
over-the-counter market, and which are not quoted by NASDAQ, are valued at the
last sale price (or, if the last sale price is not readily available, at the
most recent closing bid price as quoted by brokers that make markets in the
securities) as of the close of the regular session of trading on the NYSE on the
day the securities are being valued, (3) securities which are traded both in the
over-the-counter market and on a stock exchange are valued according to the
broadest and most representative market, and (4) securities (and other assets)
for which market quotations are not readily available are valued at their fair
value as determined in good faith in accordance with consistently applied
procedures established by the Board of Trustees. The net asset value per share
of a Fund will fluctuate with the value of the securities it holds.

Because each Fund may invest in foreign securities that are listed on foreign
exchanges, and which may trade on weekends or other days when a Fund does not
price its shares, the net asset value of a Fund's shares may change on days when
you will not be able to purchase or redeem shares.

FINANCIAL HIGHLIGHTS

The financial highlights tables are intended to help you understand the Funds'
financial performance. Certain information reflects financial results for a
single Fund share. The total returns in the tables represent the rate that an
investor would have earned or lost on an investment in a Fund (assuming
reinvestment of all distributions). Tait, Weller & Baker, has audited the
information for the periods ended December 31, 1995 through December 31, 1999.
Their report, along with each Fund's financial statements is included in the
Funds' annual report to shareholders, which is dated December 31, 1999.
Financial Highlights for the Global Technology Fund have not been provided
because this Fund had not commenced operations during the period indicated.

CALL TOLL-FREE 1.888.884.2675 Prospectus|41
<PAGE>

FINANCIAL HIGHLIGHTS - TECHNOLOGY VALUE FUND

SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
06/30/2000 12/31/1999 12/31/1998 12/31/1997 12/31/1996 12/31/1995
(unaudited)
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 90.52 $ 32.24 $ 26.06 $ 26.66 $ 18.44 $ 11.70
----------------------------------------------------------------------
Income from investment operations:
Net investment loss (0.48) (0.35) (0.59) (0.26) (0.08) (0.14)
Net realized and unrealized gains
on investments 24.36 61.36 6.77 1.90 11.20 7.28
----------------------------------------------------------------------
Total from investment operations 23.88 61.01 6.18 1.64 11.12 7.14
----------------------------------------------------------------------
Less distributions:
Dividends from net investment income -- -- -- -- -- --
Distributions from net realized gains -- (2.71) -- (1.80) (2.90) (0.40)
Distribution in excess of net realized gains -- (0.02) -- (0.44) -- --
----------------------------------------------------------------------
Total distributions -- (2.73) -- (2.24) (2.90) (0.40)
----------------------------------------------------------------------
Net asset value at end of period $ 114.40 $ 90.52 $ 32.24 $ 26.06 $ 26.66 $ 18.44
======================================================================

Total return 26.38%(a) 190.40% 23.71% 6.46% 60.55% 61.17%
======================================================================

Net assets at end of period (millions) $ 4,051.3 $1,355.6 $ 178.1 $ 194.4 $ 35.1 $ 2.7
======================================================================

Ratio of expenses to average net assets 1.83%(b) 1.91% 1.95% 1.93% 1.81% 1.98%

Ratio of net investment loss to average net assets(1.07%)(b) (1.27%) (1.80%) (1.43%) (0.55%) (1.45%)

Portfolio turnover rate 38% 41% 126% 101% 43% 45%
</TABLE>

(a) Not annualized.
(b) Annualized.

42|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

FINANCIAL HIGHLIGHTS - TECHNOLOGY LEADERS FUND

SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Six Months Year Year Year
Ended Ended Ended Ended
6/30/20001 2/31/1999 12/31/1998 12/31/1997 (a)
(unaudited)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period $ 44.68 $ 17.94 $ 10.07 $ 10.00
----------------------------------------------------
Income from investment operations:
Net investment income (loss) (0.27) (0.17) (0.09) 0.01
Net realized and unrealized gains
on investments 9.03 27.40 7.96 0.06
----------------------------------------------------
Total from investment operations 8.76 27.23 7.87 0.07
----------------------------------------------------
Less distributions:
Dividends from net investment income -- -- -- --
Distributions from net realized gains -- (0.49) -- --
Distribution in excess of net realized gains -- -- -- --
----------------------------------------------------
Total distributions -- (0.49) -- --
----------------------------------------------------

Net asset value at end of period $53.44 $ 44.68 $ 17.94 $ 10.07
====================================================

Total return 19.61%(b) 152.58% 78.15% 0.70%(b)
====================================================

Net assets at end of period (millions) $ 871.6 $ 395.6 $ 42.8 $ 3.6
====================================================

Ratio of expenses to average net assets 1.91%(c) 1.94% 1.94% 1.80%(c)

Ratio of net investment income (loss) to average net assets (1.31%)(c) (1.27%) (1.03%) 1.77%(c)

Portfolio turnover rate 10% 16% 105% 0%
</TABLE>

(a) Represents the period from the commencement of operations (December 10,
1997) through December 31, 1997.
(b) Not Annualized.
(c) Annualized.

CALL TOLL-FREE 1.888.884.2675 Prospectus|43
<PAGE>

FINANCIAL HIGHLIGHTS - TECHNOLOGY INNOVATORS FUND

SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Six Months Year Period
Ended Ended Ended
6/30/2000 12/31/1999 12/31/1998(a)
(unaudited)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value at beginning of period $ 49.36 $ 16.01 $ 10.00
------------------------------------------
Income from investment operations:
Net investment loss (0.44 (0.06) (0.01)
Net realized and unrealized gains on investments 13.35 33.98 6.02
------------------------------------------
Total from investment operations 12.91 33.92 6.01
------------------------------------------
Less distributions:
Dividends from net investment income -- -- --
Distributions from net realized gains -- (0.57) --
Distribution in excess of net realized gains -- -- --
------------------------------------------
Total distributions -- (0.57) --
------------------------------------------

Net asset value at end of period $ 62.27 $ 49.36 $ 16.01
==========================================

Total return 26.15%(b) 212.34% 60.10%(b)
==========================================

Net assets at end of period (millions) $ 863.7 $ 603.9 $ 6.5
==========================================

Ratio of expenses to average net assets 1.90%(c) 1.93% 1.92%(c)

Ratio of net investment loss to average net assets (1.45%)(c) (0.59%) (0.59%)(c)

Portfolio turnover rate 25% 44% 188%
</TABLE>

(a) Represents the period from the commencement of operations (May 20, 1998)
through December 31, 1998.
(b) Not Annualized.
(c) Annualized.

44|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

FINANCIAL HIGHLIGHTS - THE COMMUNICATIONS FUND

SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
Six Months Period
Ended Ended
6/30/2000 12/31/1999 (a)
(unaudited)
-----------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value at beginning of period $ 14.65 $ 10.00
----------------------------
Income from investment operations:
Net investment loss (0.09) (0.00)
Net realized and unrealized gains on investments 1.92 4.65
----------------------------
Total from investment operations 1.83 4.65
----------------------------
Less distributions:
Dividends from net investment income -- --

Distributions from net realized gains -- --

Distribution in excess of net realized gains -- --
----------------------------
Total distributions -- --
----------------------------

Net asset value at end of period $ 16.48 $ 14.65
============================

Total return 12.49%(b) 46.50%(b)
============================

Net assets at end of period (millions) $ 629.4 $ 182.2
============================

Ratio of expenses to average net assets 1.91%(c) 1.95%(c)

Ratio of net investment loss to average net assets (1.19%)(c) (0.30%)(c)

Portfolio turnover rate 45% 0%
</TABLE>

(a) Represents the period from the commencement of operations (September 30,
1999) through December 31, 1999.
(b) Not Annualized.
(c) Annualized.

CALL TOLL-FREE 1.888.884.2675 Prospectus|45
<PAGE>

FINANCIAL HIGHLIGHTS - THE E-COMMERCE FUND

SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
Six Months Period
Ended Ended
6/30/2000 12/31/1999 (a)
(unaudited)
--------------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value at beginning of period $ 14.86 $ 10.00
----------------------------
Income from investment operations:
Net investment income (loss) (0.07) 0.00
Net realized and unrealized gains (losses) on investments (0.29) 4.86
----------------------------
Total from investment operations (0.36) 4.86
----------------------------
Less distributions:
Dividends from net investment income -- --
Distributions from net realized gains -- --
Distribution in excess of net realized gains -- --
----------------------------
Total distributions -- --
----------------------------

Net asset value at end of period $ 14.50 $ 14.86
============================

Total return (2.42%)(b) 48.60% (b)
============================

Net assets at end of period (millions) $ 613.3 $ 298.7
============================

Ratio of expenses to average net assets 1.92% (c) 1.95% (c)

Ratio of net investment income (loss) to average net assets (1.16%)(c) 0.05% (c)

Portfolio turnover rate 21% 0%
</TABLE>

(a) Represents the period from the commencement of operations (September 30,
1999) through December 31, 1999.
(b) Not Annualized.
(c) Annualized.

46|[LOGO]FIRSTHAND-Registered Trademark- FUNDS www.FirsthandFunds.com
<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

NOTES

<PAGE>

[LOGO]

FIRSTHAND FUNDS
P.O. Box 8356
Boston, MA 02266-8356
1.888.884.2675

INVESTMENT ADVISER
Firsthand Capital Management, Inc.
125 South Market
Suite 1200
San Jose, CA 95113

UNDERWRITER
ALPS Mutual Funds Services, Inc.
Member NASD
370 17th Street
Suite 3100
Denver, CO 80202

TRANSFER AGENT
State Street Bank and Trust Company
P.O. Box 8356
Boston, MA 02266-8356
1.888.884.2675

Additional information about each Fund and its investments is included in the
Statement of Additional Information ("SAI"). The SAI is incorporated herein by
reference (that is, it legally forms a part of the prospectus). The Funds'
Annual and Semi-Annual Reports will include a discussion of each Fund's holdings
and recent market conditions and investment strategies that affected
performance.

To obtain a free copy of any of these documents or to request other information
or ask questions about a Fund (including shareholder inquiries), call Firsthand
Funds at 1.888.884.2675 or visit Firsthand's web site at www.FirsthandFunds.com.

The SAI, the Funds' Annual and Semi-Annual Reports and other related materials
are available on the SEC's Internet Web site at www.sec.gov. You can obtain
copies of this information upon paying a duplicating fee, by writing the Public
Reference Section of the SEC, Washington, D.C. 20549-0102 or by electronic
request at [email protected]. You can also review and copy information about
each Fund, including the Funds' SAI, at the SEC's Public Reference Room in
Washington, D.C. Call 1.202.942.8090 for information on the operation of the
SEC's Public Reference Room.

Firsthand is a registered trademark of Firsthand Capital Management, Inc.

File No. 811-8268

<PAGE>
FIRSTHAND FUNDS

STATEMENT OF ADDITIONAL INFORMATION

NOVEMBER 30, 2000

TECHNOLOGY VALUE FUND-REGISTERED TRADEMARK-
TECHNOLOGY LEADERS FUND
TECHNOLOGY INNOVATORS FUND
THE COMMUNICATIONS FUND-TM-
THE E-COMMERCE FUND-TM-
GLOBAL TECHNOLOGY FUND

This Statement of Additional Information is not a Prospectus. It should be read
in conjunction with the Prospectus for the Funds dated November 30, 2000, as may
be amended. A copy of the Prospectus can be obtained by writing to Firsthand
Funds at P.O. Box 8356, Boston, MA 02266-8356 , or by calling Firsthand Funds
toll-free at 1.888.884.2675. The Firsthand Funds' Semi-annual Report to
Shareholders, as filed on September 5, 2000, and the Annual Report to
Shareholders, as filed on March 6, 2000, are incorporated by reference into this
SAI. The Semi-annual and the Annual Reports are available, free of charge, upon
request, by calling the toll-free number shown above.

TABLE OF CONTENTS

<TABLE>
<S> <C>
THE TRUST................................................... 2
DEFINITIONS, POLICIES AND RISK CONSIDERATIONS............... 2
QUALITY RATINGS OF CORPORATE BONDS AND PREFERRED STOCKS..... 8
INVESTMENT RESTRICTIONS..................................... 10
TRUSTEES AND OFFICERS....................................... 11
CODE OF ETHICS.............................................. 12
INVESTMENT ADVISORY AND OTHER SERVICES...................... 12
THE UNDERWRITER............................................. 14
SECURITIES TRANSACTIONS..................................... 14
PORTFOLIO TURNOVER.......................................... 15
PURCHASE, REDEMPTION AND PRICING OF SHARES.................. 15
TAXES....................................................... 16
HISTORICAL PERFORMANCE INFORMATION.......................... 18
PRINCIPAL SECURITY HOLDERS.................................. 21
CUSTODIAN................................................... 23
LEGAL COUNSEL AND AUDITORS.................................. 23
STATE STREET BANK AND TRUST COMPANY......................... 24
FINANCIAL STATEMENTS........................................ 24
</TABLE>

1
<PAGE>
THE TRUST

Firsthand Funds (the "Trust"), an open-end management investment company, was
organized as a Delaware business trust on November 11, 1993, and offers shares
of six series. Prior to May 1, 1998, the name of the Trust was Interactive
Investments Trust. This Statement of Information ("SAI") pertains to the
Technology Value Fund, the Technology Leaders Fund, the Technology Innovators
Fund, The Communications Fund, The e-Commerce Fund, and the Global Technology
Fund (each a "Fund" and collectively the "Funds"). Each Fund is a
non-diversified series and has its own investment objective and policies.

The shares of each Fund have equal voting rights and liquidation rights, and are
voted in the aggregate and not by individual Funds, except in matters where a
separate vote is required by the Investment Company Act of 1940, as amended (the
"1940 Act"), or when the matter affects only the interest of a particular Fund.
When matters are submitted to shareholders for a vote, each shareholder is
entitled to one vote for each full share owned and fractional votes for
fractional shares owned. The Trust does not normally hold annual meetings of
shareholders. The Trustees shall promptly call and give notice of a meeting of
shareholders for the purpose of voting upon removal of any Trustee when
requested to do so in writing by shareholders holding 10% or more of the Trust's
outstanding shares. The Trust will comply with the provisions of
Section 16(c) of the 1940 Act in order to facilitate communications among
shareholders.

Each share of a Fund represents an equal proportionate interest in the assets
and liabilities belonging to that Fund with each other share of that Fund. Each
share of a Fund is entitled to its pro rata portion of such dividends and
distributions out of the income belonging to the Fund as are declared by the
Trustees. The shares do not have cumulative voting rights or any preemptive or
conversion rights, and the Trustees have the authority from time to time to
divide or combine the shares of any Fund into a greater or lesser number of
shares of that Fund so long as the proportionate beneficial interests in the
assets belonging to that Fund and the rights of shares of any other Fund are in
no way affected. In case of any liquidation of a Fund, the holders of shares of
the Fund being liquidated will be entitled to receive as a class a distribution
out of the assets, net of the liabilities, belonging to that Fund. Expenses
attributable to any Fund are borne by that Fund. Any general expenses of the
Trust not readily identifiable as belonging to a particular Fund are allocated
by or under the direction of the Trustees who allocate such expenses on the
basis of relative net assets or number of shareholders. No shareholder is liable
to further calls or to assessment by the Trust without his or her express
consent.

DEFINITIONS, POLICIES AND RISK CONSIDERATIONS

A more detailed discussion of some of the terms used and investment policies
described in the Prospectus appears below:

MAJORITY. As used in the Prospectus and this SAI, the term "majority" of the
outstanding shares of the Trust (or of any Fund) means the lesser of
(1) two-thirds or more of the outstanding shares of the Trust (or the applicable
Fund) present at a meeting, if the holders of more than 50% of the outstanding
shares of the Trust (or the applicable Fund) are present or represented at such
meeting, or (2) more than 50% of the outstanding shares of the Trust (or the
applicable Fund).

DEBT SECURITIES. Each Fund may invest in debt obligations of corporate issuers,
the U.S. Government, states, municipalities or state or municipal government
agencies that in the opinion of the Firsthand Capital Management, Inc., the
Funds' investment adviser (the "Investment Adviser"), offer long-term capital
appreciation possibilities because of the timing of such investments. Each Fund
intends that no more than 35% of its total assets will be comprised of such debt
securities. Investments in such debt obligations may result in long-term capital
appreciation because the value of debt obligations varies inversely with
prevailing interest rates. Thus, an investment in debt obligations that is sold
at a time when

2
<PAGE>

prevailing interest rates are lower than they were at the time of investment
will typically result in capital appreciation. However, the reverse is also
true, so that if an investment in debt obligations is sold at a time when
prevailing interest rates are higher than they were at the time of investment, a
capital loss will typically be realized. Accordingly, if a Fund invests in the
debt obligations described above, such investments will generally be made when
the Investment Adviser expects that prevailing interest rates will be falling,
and will generally be sold when the Investment Adviser expects interest rates to
rise.

Each Fund's investments in this area will consist solely of investment grade
securities (rated BBB or higher by Standard & Poor's Ratings Group ("Standard &
Poor's") or Baa or higher by Moody's Investors Service, Inc. ("Moody's"), or
unrated securities determined by the Investment Adviser to be of comparable
quality). While securities in these categories are generally accepted as being
of investment grade, securities rated BBB or Baa have speculative
characteristics and changes in economic conditions or other circumstances are
more likely to lead to a weakened capacity to pay principal and interest than is
the case with higher grade securities. In the event a security's rating is
reduced below a Fund's minimum requirements, the Fund will sell the security,
subject to market conditions and the Investment Adviser's assessment of the most
opportune time for sale.

COMMERCIAL PAPER. Commercial paper consists of short-term (usually from one to
270 days) unsecured promissory notes issued by corporations in order to finance
their current operations. Each Fund will only invest in commercial paper rated
A-1 by Standard & Poor's or Prime-1 by Moody's or unrated paper of issuers who
have outstanding unsecured debt rated AA or better by Standard & Poor's or Aa or
better by Moody's. Certain notes may have floating or variable rates. Variable
and floating rate notes with a demand notice period exceeding seven days will be
subject to each Fund's policy with respect to illiquid investments unless, in
the judgment of the Investment Adviser, such note is liquid.

The rating of Prime-1 is the highest commercial paper rating assigned by
Moody's. The factors considered by Moody's in assigning ratings include the
following: valuation of the management of the issuer; economic evaluation of the
issuer's industry or industries and an appraisal of speculative-type risks which
may be inherent in certain areas; evaluation of the issuer's products in
relation to competition and customer acceptance; liquidity; amount and quality
of long-term debt; trend of earnings over a period of 10 years; financial
strength of the issuer's parent company and the relationships that exist with
the issuer; and recognition by the management of obligations that may be present
or may arise as a result of public interest questions and preparations to meet
such obligations. Issuers of commercial paper rated A (highest quality) by
Standard & Poor's have the following characteristics: liquidity ratios are
adequate to meet cash requirements; long-term senior debt is rated "A" or better
(although in some cases "BBB" credits may be allowed); the issuer has access to
at least two additional channels of borrowing; basic earnings and cash flow have
an upward trend with allowance made for unusual circumstances; typically, the
issuer's industry is well established and the issuer has a strong position
within the industry; and the reliability and quality of management are
unquestioned. The relative strength or weakness of the above factors determines
whether the issuer's commercial paper is rated A-1.

BANK DEBT INSTRUMENTS. Bank debt instruments in which the Funds may invest
consist of certificates of deposit, bankers' acceptances and time deposits
issued by national banks and state banks, trust companies and mutual savings
banks, or by banks or institutions the accounts of which are insured by the
Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance
Corporation. Certificates of deposit are negotiable certificates evidencing the
indebtedness of a commercial bank to repay funds deposited with it for a
definite period of time (usually from 14 days to one year) at a stated or
variable interest rate. Bankers' acceptances are credit instruments evidencing
the obligation of a bank to pay a draft that has been drawn on it by a customer,
and these instruments reflect the obligation both of the bank and of the drawer
to pay the face amount of the instrument upon maturity. Time deposits are
non-negotiable deposits maintained in a banking institution for a specified
period of time at a stated

3
<PAGE>
interest rate. A Fund will not invest in time deposits maturing in more than
seven days if, as a result thereof, more than 15% of the value of its net assets
would be invested in such securities and other illiquid securities.

REPURCHASE AGREEMENTS. Repurchase agreements are transactions by which a Fund
purchases a security and simultaneously commits to resell that security to the
seller at an agreed upon time and price, thereby determining the yield during
the term of the agreement. In the event of a bankruptcy or other default by the
seller of a repurchase agreement, a Fund could experience both delays in
liquidating the underlying security and losses. To minimize these possibilities,
each Fund intends to enter into repurchase agreements only with its Custodian,
with banks having assets in excess of $10 billion, and with broker-dealers who
are recognized as primary dealers in U.S. Government obligations by the Federal
Reserve Bank of New York. Collateral for repurchase agreements is held in
safekeeping in the customer-only account of the Funds' Custodian at the Federal
Reserve Bank. A Fund will not enter into a repurchase agreement not terminable
within seven days if, as a result thereof, more than 15% of the value of its net
assets would be invested in such securities and other illiquid securities.

Although the securities subject to a repurchase agreement might bear maturities
exceeding one year, settlement for the repurchase would never be more than one
year after the Fund's acquisition of the securities and normally would be within
a shorter period of time. The resale price will be in excess of the purchase
price, reflecting an agreed upon market rate effective for the period of time
the Fund's money will be invested in the securities, and will not be related to
the coupon rate of the purchased security. At the time a Fund enters into a
repurchase agreement, the value of the underlying security, including accrued
interest, will equal or exceed the value of the repurchase agreement, and, in
the case of a repurchase agreement exceeding one day, the seller will agree that
the value of the underlying security, including accrued interest, will at all
times equal or exceed the value of the repurchase agreement. The collateral
securing the seller's obligation must be of a credit quality at least equal to a
Fund's investment criteria for portfolio securities and will be held by the
Custodian or in the Federal Reserve Book Entry System.

For purposes of the 1940 Act, a repurchase agreement is deemed to be a loan from
a Fund to the seller subject to the repurchase agreement and is therefore
subject to a Fund's investment restriction applicable to loans. It is not clear
whether a court would consider the securities purchased by a Fund subject to a
repurchase agreement as being owned by that Fund or as being collateral for a
loan by the Fund to the seller. In the event of the commencement of bankruptcy
or insolvency proceedings with respect to the seller of the securities before
repurchase of the security under a repurchase agreement, a Fund may encounter
delay and incur costs when trying to sell the security. Costs incurred as a
result of delays may include loss of interest or a decline in price of a
security. If a court characterized the transaction as a loan and a Fund has not
perfected a security interest in the security, that Fund may be required to
return the security to the seller's estate and be treated as an unsecured
creditor of the seller. As an unsecured creditor, a Fund would be at risk of
losing some or all of the principal and income involved in the transaction. As
with any unsecured debt obligation purchased by a Fund, the Investment Adviser
seeks to minimize the potential risk of loss by analyzing the creditworthiness
of the obligor, which in this case, is the seller. Apart from the risk of
bankruptcy or insolvency proceedings, there is also the risk that the seller may
fail to repurchase the security, in which case a Fund may incur a loss if the
proceeds to that Fund of the sale of the security to a third party are less than
the repurchase price. However, if the market value of the securities subject to
the repurchase agreement becomes less than the repurchase price (including
interest), the Fund involved will direct the seller of the security to deliver
additional securities so that the market value of all securities subject to the
repurchase agreement will equal or exceed the repurchase price. It is possible
that a Fund will be unsuccessful in seeking to enforce the seller's contractual
obligation to deliver additional securities.

4
<PAGE>
MONEY MARKET FUNDS. Each Fund may, under certain circumstances, invest a
portion of its assets in money market investment companies. The 1940 Act
prohibits a Fund from investing more than 5% of the value of its total assets in
any one investment company, or more than 10% of the value of its total assets in
investment companies in the aggregate, and also restricts a Fund's investment in
any investment company to 3% of the voting securities of such investment
company. Investment in a money market investment company involves payment by the
Fund of its pro rata share of advisory and administrative fees paid by such
investment company, which are in addition to a Fund's own advisory and
administrative fees.

WARRANTS. Each Fund may invest a portion of its assets in warrants, but only to
the extent that such investments do not exceed 5% of a Fund's net assets at the
time of purchase. A warrant gives the holder a right to purchase at any time
during a specified period a predetermined number of shares of common stock at a
fixed price. Unlike convertible debt securities or preferred stock, warrants do
not pay a fixed coupon or dividend. Investments in warrants involve certain
risks, including the possible lack of a liquid market for resale of the
warrants, potential price fluctuations as a result of speculation or other
factors, and failure of the price of the underlying security to reach or have
reasonable prospects of reaching a level at which the warrant can be prudently
exercised (in which event the warrant may expire without being exercised,
resulting in a loss of a Fund's entire investment therein).

FOREIGN SECURITIES. Subject to each Fund's investment policies and quality
standards, each Fund may invest in the securities of foreign issuers. Because
the Funds may invest in foreign securities, an investment in a Fund involves
risks that are different in some respects from an investment in a fund that
invests only in securities of U.S. domestic issuers. Foreign investments may be
affected favorably or unfavorably by changes in currency rates and exchange
control regulations. There may be less publicly available information about a
foreign company than about a U.S. company, and foreign companies may not be
subject to accounting, auditing and financial reporting standards and
requirements that are comparable to those that are applicable to U.S. companies.
There may be less governmental supervision of foreign securities markets and the
brokers and issuers of foreign securities. Securities of some foreign companies
are less liquid or more volatile than securities of U.S. companies, and foreign
brokerage commissions and custodian fees are generally higher than those in the
United States. Settlement practices may include delays and may differ from those
customary in United States markets. Investments in foreign securities may also
be subject to other risks that differ from those affecting U.S. investments,
including political or economic developments, expropriation or nationalization
of assets, restrictions on foreign investments and repatriation of capital,
imposition of withholding taxes on dividend or interest payments, currency
blockage (which would prevent cash from being brought back to the United
States), and the difficulty of enforcing legal rights outside the United States.

NON-DIVERSIFICATION OF INVESTMENTS. Each Fund is operated as a
"non-diversified" investment company. As a non-diversified investment company,
each Fund may be subject to greater risks than diversified companies because
since each Fund invests in only a few issuers, if the value of those issuers
fluctuates, the value of the Fund is affected to a greater degree than if the
Fund had a more diversified portfolio. However, at the close of each fiscal
quarter at least 50% of the value of each Fund's total assets will be
represented by one or more of the following: (i) cash and cash items, including
receivables; (ii) U.S. Government securities; (iii) securities of other
regulated investment companies; and (iv) securities (other than U.S. Government
securities and securities of other regulated investment companies) of any one or
more issuers which meet the following limitations: (a) a Fund will not invest
more than 5% of its total assets in the securities of any such issuer and (b)
the entire amount of the securities of such issuer owned by a Fund will not
represent more than 10% of the outstanding voting securities of such issuer.
Additionally, not more than 25% of the value of a Fund's total assets may be
invested in the securities of any one issuer.

5
<PAGE>
WRITING COVERED CALL OPTIONS. Each Fund may write covered call options on
equity securities or futures contracts to earn premium income, to assure a
definite price for a security that a Fund has considered selling, or to close
out options previously purchased. A call option gives the holder (buyer) the
right to purchase a security or futures contract at a specified price (the
exercise price) at any time before a certain date (the expiration date). A call
option is "covered" if a Fund owns the underlying security subject to the call
option at all times during the option period. A covered call writer is required
to deposit in escrow the underlying security in accordance with the rules of the
appropriate clearing agency and the exchanges on which the option is traded.

The writing of covered call options is a conservative investment technique that
the Investment Adviser believes involves relatively little risk. However, there
is no assurance that a closing transaction can be effected at a favorable price.
During the option period, although the covered call writer has, in return for
the premium received, given up the opportunity for capital appreciation above
the exercise price should the market price of the underlying security increase,
the call writer has retained the risk of loss should the price of the underlying
security decline. Currently, writing covered call options is not a principal
investment strategy of any Fund.

WRITING COVERED PUT OPTIONS. Each Fund may write covered put options on equity
securities and futures contracts to assure a definite price for a security if
the Fund is considering acquiring the security at a lower price than the current
market price or to close out options previously purchased. A put option gives
the holder of the option the right to sell, and the writer has the obligation to
buy, the underlying security at the exercise price at any time during the option
period. The operation of put options in other respects is substantially
identical to that of call options. When a Fund writes a covered put option, it
maintains in a segregated account with its Custodian cash or liquid securities
in an amount not less than the exercise price at all times while the put option
is outstanding.

The risks involved in writing put options include the chance that a closing
transaction cannot be effected at a favorable price and the possibility that the
price of the underlying security may fall below the exercise price, in which
case a Fund may be required to purchase the underlying security at a higher
price than the market price of the security at the time the option is exercised.
Currently, writing covered put options is not a principal investment strategy of
any Fund.

OPTIONS TRANSACTIONS GENERALLY. Option transactions in which the Funds may
engage involve the specific risks described above as well as the following
risks: the writer of an option may have that option exercised at any time during
the option period; disruptions in the markets for underlying instruments could
result in losses for options investors; there may be imperfect or no correlation
between the option and the securities being hedged; the insolvency of a broker
could present risks for the broker's customers; and market imposed restrictions
may prohibit the exercise of certain options. In addition, the option activities
of a Fund may affect its portfolio turnover rate and the amount of brokerage
commissions paid by a Fund. The success of a Fund in using the option strategies
described above depends, among other things, on the Investment Adviser's ability
to predict the direction and volatility of price movements in the options,
futures contracts and securities markets and the Investment Adviser's ability to
select the proper time, type and duration of the options.

By writing options, a Fund forgoes the opportunity to profit from an increase in
the market price of the underlying security or stock index above the exercise
price except insofar as the premium represents such a profit. Each Fund also may
seek to earn additional income through receipt of premiums by writing covered
put options. The risk involved in writing such options is that there could be a
decrease in the market value of the underlying security or stock index. If this
occurs, the option could be exercised and the underlying security would then be
sold to the Fund at a price higher than its then current market value. A Fund
may purchase put and call options to attempt to provide protection against
adverse price effects from

6
<PAGE>

anticipated changes in prevailing prices of securities or stock indices. The
purchase of a put option generally protects the value of portfolio holdings in a
falling market, while the purchase of a call option generally protects cash
reserves from a failure to participate in a rising market. In purchasing a call
option, a Fund would realize a gain if, during the option period, the price of
the security or stock index increased by an amount greater than the premium
paid. A Fund would realize a loss if the price of the security or stock index
decreased, remained the same, or did not increase during the period by more than
the amount of the premium. If a put or call option purchased by a Fund were
permitted to expire without being sold or exercised, its premium would represent
a realized loss to the Fund. When writing put options a Fund will be required to
segregate cash and/or liquid securities to meet its obligations. When writing
call options a Fund will be required to own the underlying financial instrument
or segregate with its Custodian cash and/ or liquid securities to meet its
obligations under written calls. By so doing, a Fund's ability to meet current
obligations, to honor redemptions or to achieve its investment objective may be
impaired. The staff of the Securities and Exchange Commission has taken the
position that over-the-counter options and the assets used as "cover" for
over-the-counter options are illiquid securities.

The imperfect correlation in price movement between an option and the underlying
financial instrument and/or the costs of implementing such an option may limit
the effectiveness of the strategy. A Fund's ability to establish and close out
options positions will be subject to the existence of a liquid secondary market.
Although a Fund generally will purchase or sell only those options for which
there appears to be an active secondary market, there is no assurance that a
liquid secondary market on an exchange will exist for any particular option or
at any particular time. If an option purchased by a Fund expires unexercised,
the Fund will lose the premium it paid. In addition, a Fund could suffer a loss
if the premium paid by the Fund in a closing transaction exceeds the premium
income it received. When a Fund writes a call option, its ability to participate
in the capital appreciation of the underlying obligation is limited.

It is the present intention of the Investment Adviser not to commit greater than
30% of a Fund's net assets to option strategies.

BORROWING. Each Fund may borrow from banks for temporary or emergency purposes
in an aggregate amount not to exceed 25% of its total assets. Borrowing
magnifies the potential for gain or loss on the portfolio securities of a Fund
and, therefore, if employed, increases the possibility of fluctuation in the
Fund's net asset value. This is the speculative factor known as leverage. To
reduce the risks of borrowing, each Fund will limit its borrowings as described
above. Each Fund may pledge its assets in connection with borrowings. While a
Fund's borrowings exceed 5% of its total assets, it will not purchase portfolio
securities.

The use of borrowing by a Fund involves special risk considerations that may not
be associated with other funds having similar policies. Since substantially all
of a Fund's assets fluctuate in value, whereas the interest obligation resulting
from a borrowing will be fixed by the terms of the Fund's agreement with its
lender, the asset value per share of the Fund will tend to increase more when
its portfolio securities increase in value and decrease more when its portfolio
securities decrease in value than would otherwise be the case if the Fund did
not borrow funds. In addition, interest costs on borrowings may fluctuate with
changing market rates of interest and may partially offset or exceed the return
earned on borrowed funds. Under adverse market conditions, a Fund might have to
sell portfolio securities to meet interest or principal payments at a time when
fundamental investment considerations would not favor such sales.

LOANS OF PORTFOLIO SECURITIES. Each Fund may lend its portfolio securities to
banks, brokers and dealers. Lending portfolio securities exposes a Fund to risks
which include the risk that the borrower may fail to return the loaned
securities or may not be able to provide additional collateral or that a Fund
may experience delays in recovery of the loaned securities or loss of rights in
the collateral if the borrower fails financially. To minimize these risks, the
borrower must agree to maintain collateral, marked to market

7
<PAGE>

daily, in the form of cash and/or U.S. Government obligations, with the Funds'
Custodian in an amount at least equal to the market value of the loaned
securities. Each Fund will limit the amount of its loans of its portfolio
securities to no more than 30% of its total assets.

Under applicable regulatory requirements (which are subject to change), the loan
collateral must, on each business day, at least equal the value of the loaned
securities. A Fund receives amounts equal to the dividends or interest on loaned
securities and also receive one or more of (a) negotiated loan fees, and/or (b)
interest on cash or securities used as collateral, or interest on short-term
debt securities purchased with such collateral; either type of interest may be
shared with the borrower. A Fund may also pay fees to placing brokers as well as
to the custodian and administrator in connection with loans. The terms of a
Fund's loans must meet applicable tests under the Internal Revenue Code and must
permit a Fund to reacquire loaned securities in time to vote on any important
matter. Loans of portfolio securities are not a principal investment strategy of
any Fund.

ILLIQUID SECURITIES. Historically, illiquid securities have included securities
subject to contractual or legal restrictions on resale because they have not
been registered under the Securities Act of 1933 (the "Securities Act"),
securities that are otherwise not readily marketable, and securities such as
repurchase agreements having a maturity of longer than seven days. Securities
that have not been registered under the Securities Act are referred to as
private placements or restricted securities and are purchased directly from the
issuer or in the secondary market. Mutual funds do not typically hold a
significant amount of these restricted or other illiquid securities because of
the potential for delays on resale and uncertainty in valuation. Limitations on
resale may have an adverse effect on the marketability of portfolio securities
and a mutual fund might be unable to dispose of restricted securities promptly
or at reasonable prices and might thereby experience difficulty satisfying
redemption requirements. A mutual fund also might have to register such
restricted securities in order to dispose of them, resulting in additional
expense and delay. Adverse market conditions could impede such a public offering
of securities.

In recent years, however, a large institutional market has developed for certain
securities that are not registered under the Securities Act including repurchase
agreements, commercial paper, foreign securities, municipal securities and
corporate bonds and notes. Institutional investors depend on an efficient
institutional market in which the unregistered security can be readily resold or
on an issuer's ability to honor a demand for repayment. The fact that there are
contractual or legal restrictions on resale to the general public or to certain
institutions may not be indicative of the liquidity of such investments. The
Board of Trustees may determine that such securities are not illiquid securities
notwithstanding their legal or contractual restrictions on resale. In all other
cases, however, securities subject to restrictions on resale will be deemed
illiquid. In addition, such securities could become illiquid if, for a time,
qualified institutional buyers become unavailable, and if such securities become
illiquid, they would be counted in determining the limit on illiquid securities
held in a Fund's portfolio.

QUALITY RATINGS OF CORPORATE BONDS AND PREFERRED STOCKS

THE RATINGS OF MOODY'S AND STANDARD & POOR'S FOR CORPORATE BONDS IN WHICH THE
FUNDS MAY INVEST ARE AS FOLLOWS:

MOODY'S

Aaa - Bonds that are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edge." Interest payments are protected by a large (or by an exceptionally
stable) margin and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.

8
<PAGE>
Aa - Bonds that are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high-grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities, fluctuation of protective elements may
be of greater amplitude or, there may be other elements present which make the
long-term risks appear somewhat larger than in Aaa securities.

A - Bonds that are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.

Baa - Bonds that are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

STANDARD & POOR'S

AAA - Bonds rated AAA have the highest rating assigned by Standard & Poor's to a
debt obligation. Capacity to pay interest and repay principal is extremely
strong.

AA - Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to a small degree.

A - Bonds rated A have a strong capacity to pay interest and repay principal
although they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than bonds in higher rated categories.

BBB - Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
bonds in this category than for bonds in higher rated categories.

THE RATINGS OF MOODY'S AND STANDARD & POOR'S FOR PREFERRED STOCKS IN WHICH THE
FUNDS MAY INVEST ARE AS FOLLOWS:

MOODY'S

aaa - An issue that is rated aaa is considered to be a top-quality preferred
stock. This rating indicates good asset protection and the least risk of
dividend impairment within the universe of preferred stocks.

aa - An issue that is rated aa is considered a high-grade preferred stock. This
rating indicates that there is reasonable assurance that earnings and asset
protection will remain relatively well maintained in the foreseeable future.

a - An issue that is rated a is considered to be an upper-medium grade preferred
stock. Although risks are judged to be somewhat greater than in the aaa and aa
classifications, earnings and asset protection are, nevertheless, expected to be
maintained at adequate levels.

baa - An issue that is rated baa is considered to be medium grade, neither
highly protected nor poorly secured. Earnings and asset protection appear
adequate at present but may be questionable over any great length of time.

9
<PAGE>
STANDARD & POOR'S

AAA - This is the highest rating that may be assigned by Standard & Poor's to a
preferred stock issue and it indicates an extremely strong capacity to pay the
preferred stock obligations.

AA - A preferred stock issue rated AA also qualifies as a high-quality
fixed-income security. The capacity to pay preferred stock obligations is very
strong, although not as overwhelming as for issues rated AAA.

A - An issue rated A is backed by a sound capacity to pay the preferred stock
obligations, although it is somewhat more susceptible to the diverse effects of
changes in circumstances and economic conditions.

BBB - An issue rated BBB is regarded as backed by an adequate capacity to pay
the preferred stock obligations. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing circumstances are
more likely to lead to a weakened capacity to make payments for a preferred
stock in this category than for issues in the A category.

INVESTMENT RESTRICTIONS

The Trust has adopted certain fundamental investment restrictions that are
designed to reduce the risk of investing in a Fund. These restrictions may not
be changed with respect to any Fund without the affirmative vote of a majority
of the outstanding voting securities of that Fund. No Fund shall:

1. Underwrite the securities of other issuers, except that a Fund may, as
indicated in the Prospectus, acquire restricted securities under circumstances
where, if such securities are sold, the Fund might be deemed to be an
underwriter for purposes of the Securities Act.

2. Purchase or sell real estate or interests in real estate, but a Fund may
purchase marketable securities of companies holding real estate or interests in
real estate.

3. Purchase or sell commodities or commodity contracts, including futures
contracts, except that the Technology Leaders Fund, the Technology Innovators
Fund, The Communications Fund, The e-Commerce Fund, and the Global Technology
Fund may purchase and sell futures contracts to the extent authorized by the
Board of Trustees.

4. Make loans to other persons except (i) by the purchase of a portion of
an issue of publicly distributed bonds, debentures or other debt securities or
privately sold bonds, debentures or other debt securities immediately
convertible into equity securities, such purchases of privately sold debt
securities not to exceed 5% of a Fund's total assets, and (ii) the entry into
portfolio lending agreements (i.e., loans of portfolio securities) provided that
the value of securities subject to such lending agreements may not exceed 30% of
the value of a Fund's total assets.

5. Purchase securities on margin, but a Fund may obtain such short-term
credits as may be necessary for the clearance of purchases and sales of
securities.

6. Borrow money from banks except for temporary or emergency (not
leveraging) purposes, including the meeting of redemption requests that might
otherwise require the untimely disposition of securities, in an aggregate amount
not exceeding 25% of the value of a Fund's total assets at the time any
borrowing is made. While a Fund's borrowings are in excess of 5% of its total
assets, the Fund will not purchase portfolio securities.

7. Purchase or sell puts and calls on securities, except that the
Technology Leaders Fund, the Technology Innovators Fund, The Communications
Fund, The e-Commerce Fund, and the Global Technology Fund may purchase and sell
puts and calls on stocks and stock indices.

8. Make short sales of securities.

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<PAGE>
9. Participate on a joint or joint and several basis in any securities
trading account.

10. Purchase the securities of any other investment company except in
compliance with the 1940 Act.

In addition, each Fund has adopted a fundamental policy of concentrating its
investments in certain high technology industries as described in the
Prospectus.

With respect to the percentages adopted by the Trust as maximum limitations on a
Fund's investment policies and restrictions, an excess above the fixed
percentage (except for the percentage limitations relative to the borrowing of
money) will not be a violation of the policy or restriction unless the excess
results immediately and directly from the acquisition of any security or the
action taken.

TRUSTEES AND OFFICERS

The business of the Trust is managed under the direction of the Board of
Trustees in accordance with the Declaration of Trust of the Trust. The
Declaration of Trust has been filed with the Securities and Exchange Commission
and is available upon request. Pursuant to the Declaration of Trust, the
Trustees shall elect officers including a president, secretary and treasurer.
The Board of Trustees retains the power to conduct, operate and carry on the
business of the Trust and has the power to incur and pay any expenses, which, in
the opinion of the Board of Trustees, are necessary or incidental to carry out
any of the Trust's purposes. The Trustees, officers, employees and agents of the
Trust, when acting in such capacities, shall not be subject to any personal
liability except for his or her own bad faith, willful misfeasance, gross
negligence or reckless disregard of his or her duties. Following is a list of
the Trustees and executive officers of the Trust and their compensation from the
Trust for the fiscal year ended December 31, 1999.

<TABLE>
<CAPTION>
YEAR OF POSITION HELD
NAME BIRTH WITH THE TRUST TOTAL COMPENSATION**
---- -------- ------------------- --------------------
<S> <C> <C> <C>
Kevin M. Landis*............................... 1961 Trustee/President N/A
Michael T. Lynch............................... 1961 Trustee $20,000
Mark Taguchi***................................ 1956 Trustee $20,000
Jerry Wong***.................................. 1951 Trustee $ 0
Yakoub Bellawala............................... 1965 Treasurer N/A
Omar Billawala................................. 1961 Secretary N/A
William Beston................................. 1967 Assistant Treasurer N/A
Julie Tedesco.................................. 1957 Assistant Secretary N/A
Sheila Twible.................................. 1957 Assistant Treasurer N/A
</TABLE>

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

*Kevin M. Landis is an affiliated person of Firsthand Capital
Management, Inc., the Funds' investment adviser, and is an "interested
person" of the Trust within the meaning of Section 2(a)(19) of the 1940 Act.

**The Trust does not maintain pension or retirement plans.

***Mark Taguchi resigned in November 1999. After accepting his resignation, the
Board of Trustees then appointed Jerry Wong as a new independent trustee of
the Trust.

The principal occupations of the Trustees and executive officers of the Trust
during the past five years are set forth below:

KEVIN M. LANDIS, 125 South Market, Suite 1200, San Jose, CA 95113, is President
of Firsthand Capital Management, Inc., and has been a portfolio manager with
Firsthand Capital Management, Inc. since 1994.

MICHAEL T. LYNCH, 400 North 34th St., Suite 300, Seattle, WA 98103, is currently
a Vice President of Sales and Business Development at Picture IQ Corporation (a
manufacturer of digital imaging software).

11
<PAGE>

Mr. Lynch served as a Product Manager for Iomega Corp. (a manufacturer of
computer peripherals) from 1995 through 1999. Mr. Lynch served as a Product
Manager for Adaptec, Inc. (a manufacturer of computer peripherals and software)
during 1995. He served as Product Line Manager for Calera Recognition
Systems, Inc. (a manufacturer of Optical Character Recognition software) from
1990 to 1995.

JERRY WONG, 999 Baker Way, Suite 100, San Mateo, CA 94104, is currently Vice
President of Finance and Executive Vice President of U.S. Operations of Poet
Holdings, Inc. (a manufacturer of software). Mr. Wong served as a Corporate
Controller for Blyth Software Inc. from 1993 through July 1995 and has been with
Poet since 1995. Mr. Wong served as Corporate Controller and Secretary of
Corporation for Protocol Engines Inc from 1991 to 1993.

YAKOUB BELLAWALA, 125 South Market, Suite 1200, San Jose, CA 95113, is Vice
President of Business Development of Firsthand Capital Management, Inc. He was
previously the Database Marketing Manager for Silicon Graphics, Inc. (a
manufacturer of computers) from 1995 through 1996. Prior to that he was the
Director of Product Management and Product Marketing for Starbase Corporation (a
manufacturer of software) from 1994 through 1995.

OMAR BILLAWALA, 125 South Market, Suite 1200, San Jose, CA 95113, is Chief
Operating Officer of Firsthand Capital Management, Inc. Prior to that, he was an
associate at Paul Hastings, Janofsky & Walker LLP from 1997 to 1999.

WILLIAM BESTON, 225 Franklin Street, Boston, MA 02110, has been a Vice President
at State Street Bank and Trust Company from June 1996 to the present. Prior to
that, he was a manager at Coopers & Lybrand from 1989-1996.

JULIE TEDESCO, 225 Franklin Street, Boston, MA 02110, is a Vice President and
Associate Counsel at State Street Bank and Trust Company. From 1994 to January,
2000, she was Counsel at First Data Investor Services Group, Inc., which is a
third-party mutual fund administrator.

SHEILA TWIBLE, 225 Franklin Street, Boston, MA 02110, has been a Director of
Fund Administration at State Street Bank and Trust Company from 1992 to the
present.

CODES OF ETHICS

The Trust, its Investment Adviser, and its principal underwriter have adopted
codes of ethics under Rule 17j-1 of the 1940 Act. These codes of ethics permit
personnel subject to the codes to invest in securities that may be purchased or
held by a Fund.

INVESTMENT ADVISORY AND OTHER SERVICES

Firsthand Capital Management, Inc. (the "Investment Adviser"), 125 South Market,
Suite 1200, San Jose, California 95113, is registered as an investment adviser
with the Securities and Exchange Commission under the 1940 Act. The Investment
Adviser is controlled by Kevin M. Landis. Prior to September 1999, the
Investment Adviser was named Interactive Research Advisers, Inc.

Under the terms of the Investment Advisory and Management Agreement (the
"Advisory Agreement") between the Trust and the Investment Adviser, the
Investment Adviser (i) manages the investment operations of each Fund and the
composition of its portfolio, including the purchase, retention and disposition
of securities in accordance with each Fund's investment objective,
(ii) provides all statistical, economic and financial information reasonably
required by the Funds and reasonably available to the Investment Adviser,
(iii) provides the Custodian of the Funds' securities on each business day with
a list of

12
<PAGE>
trades for that day, and (iv) provides persons satisfactory to the Trust's Board
of Trustees to act as officers of the Trust.

Pursuant to the Advisory Agreement, each Fund pays to the Investment Adviser, on
a monthly basis, an advisory fee at an annual rate of 1.50% of its average daily
net assets. The Advisory Agreement requires the Investment Adviser to waive fees
and, if necessary, reimburse expenses of the Funds to the extent necessary to
limit each Fund's total operating expenses to 1.95% of its average net assets up
to $200 million, 1.90% of such assets from $200 million to $500 million, 1.85%
of such assets from $500 million to $1 billion, and 1.80% of such assets in
excess of $1 billion. For the fiscal years ended December 31, 1999, 1998, and
1997, the Technology Value Fund paid advisory fees of $6,202,423, $2,734,532,
and $1,830,251, respectively. For the fiscal year and period ended December 31,
1999, 1998 and 1997, the Technology Leaders Fund paid advisory fees of
$1,769,767, $286,734 and $1,769, respectively. For the fiscal period ended
December 31, 1999 and 1998, the Technology Innovators Fund paid advisory fees of
$1,751,713 and $14,782, respectively. For the fiscal period ended December 31,
1999, the Communications Fund paid advisory fees of $248,417. For the fiscal
period ended December 31, 1999, the e-Commerce Fund paid advisory fees of
$404,384.

By its terms, the Advisory Agreement remains in force from year to year, subject
to annual approval by (a) the Board of Trustees, or (b) a vote of the majority
of a Fund's outstanding voting securities; provided that in either event
continuance is also approved by a majority of the Trustees who are not
interested persons of the Trust, by a vote cast in person at a meeting called
for the purpose of voting such approval. The Advisory Agreement may be
terminated at any time, on 60 days' written notice, without the payment of any
penalty, by the Board of Trustees, by a vote of the majority of a Fund's
outstanding voting securities, or by the Investment Adviser. The Advisory
Agreement automatically terminates in the event of its assignment, as defined by
the 1940 Act and the rules thereunder.

The Board of Trustees of the Trust has approved an Administration Agreement with
the Investment Adviser wherein the Investment Adviser is responsible for the
provision of administrative and supervisory services to the each Fund. The
Investment Adviser, at its expense, shall supply the Trustees and the officers
of the Trust with all statistical information and reports reasonably required by
it and reasonably available to the Investment Adviser. The Investment Adviser
shall oversee the maintenance of all books and records with respect to the
Funds' security transactions and the Funds' books of account in accordance with
all applicable federal and state laws and regulations. The Investment Adviser
will arrange for the preservation of the records required to be maintained by
the 1940 Act.

Pursuant to the Administration Agreement, each Fund will pay to the Investment
Adviser, on a monthly basis, a fee equal to 0.45% per annum of its average daily
net assets up to $200 million, 0.40% of such assets from $200 million to $500
million, 0.35% of such assets from $500 million to $1 billion, and 0.30% of such
assets in excess of $1 billion.

For the fiscal years ended December 31, 1999, 1998, and 1997, the Technology
Value Fund paid administrative fees of $1,703,732, $816,383, and $778,503,
respectively. For the fiscal years and period ended December 31, 1999, 1998 and
1997, the Technology Leaders Fund paid administrative fees of $524,251, $86,020
and $531, respectively. For the fiscal year and period ended December 31, 1999
and 1998, the Technology Innovators Fund paid administrative fees of $505,227
and $4,435, respectively. For the fiscal period ended December 31, 1999, the
Communications Fund and the e-Commerce Fund paid administrative fees of $74,525
and $120,372, respectively.

The Administration Agreement may be terminated by the Trust at any time, on 60
days' notice to the Investment Adviser, without penalty either (a) by vote of
the Board of Trustees of the Trust, or (b) by vote

13
<PAGE>
of a majority of the outstanding voting securities of a Fund. It may be
terminated at any time by the Investment Adviser on 60 days' written notice to
the Trust.

THE UNDERWRITER

ALPS Mutual Fund Services, Inc. (the "Underwriter"), 370 17th Street,
Suite 3100, Denver, CO 80202, serves as principal underwriter for the Trust
pursuant to a Distribution Agreement. Shares are sold on a continuous basis by
the Underwriter. The Underwriter has agreed to use its best efforts to solicit
orders for the sale of Trust shares, but it is not obligated to sell any
particular amount of shares. The Distribution Agreement provides that, unless
sooner terminated, it will continue in effect from year to year, subject to
annual approval by (a) the Board of Trustees or a vote of a majority of the
outstanding shares, and (b) by a majority of the Trustees who are not interested
persons of the Trust or of the Underwriter by vote cast in person at a meeting
called for the purpose of voting on such approval.

The Distribution Agreement may be terminated by the Trust at any time, without
the payment of any penalty, by vote of a majority of the entire Board of
Trustees of the Trust or by vote of a majority of the outstanding shares of the
Funds on 60 days' written notice to the Underwriter, or by the Underwriter at
any time, without the payment of any penalty, on 60 days' written notice to the
Trust. The Distribution Agreement will automatically terminate in the event of
its assignment.

SECURITIES TRANSACTIONS

The Investment Adviser furnishes advice and recommendations with respect to the
Funds' portfolio decisions and, subject to the supervision of the Board of
Trustees of the Trust, determines the broker to be used in each specific
transaction. In executing the Funds' portfolio transactions, the Investment
Adviser seeks to obtain the best net results for the Funds, taking into account
such factors as the overall net economic result to the Funds (involving both
price paid or received and any commissions and other costs paid), the efficiency
with which the specific transaction is effected, the ability to effect the
transaction where a large block is involved, the known practices of brokers and
the availability to execute possibly difficult transactions in the future, and
the financial strength and stability of the broker. While the Investment Adviser
generally seeks reasonably competitive commission rates, the Funds do not
necessarily pay the lowest commission or spread available.

The Investment Adviser may direct the Funds' portfolio transactions to persons
or firms because of research and investment services provided by such persons or
firms if the amount of commissions in effecting the transactions is reasonable
in relationship to the value of the investment information provided by those
persons or firms. Such research and investment services are those which
brokerage houses customarily provide to institutional investors and include
statistical and economic data and research reports on particular companies and
industries. These services may be used by the Investment Adviser in connection
with all of its investment activities, and some of the services obtained in
connection with the execution of transactions for the Funds may be used in
managing the Investment Adviser's other investment accounts.

The Funds may deal in some instances in securities that are not listed on a
national securities exchange but are traded in the over-the-counter market. The
Funds may also purchase listed securities through the "third market" (i.e.,
otherwise than on the exchanges on which the securities are listed). When
transactions are executed in the over-the-counter market or the third market,
the Investment Adviser will seek to deal with primary market makers and to
execute transactions on the Funds' own behalf, except in those circumstances
where, in the opinion of the Investment Adviser, better prices and executions
may be available elsewhere. The Board of Trustees reviews periodically the
allocation of brokerage orders to monitor the operation of these transactions.

14
<PAGE>
Neither the Investment Adviser nor any affiliated person thereof will
participate in commissions paid by the Funds to brokers or dealers or will
receive any reciprocal business, directly or indirectly, as a result of such
commissions.

The Technology Value Fund paid brokerage commissions of $332,719, $110,003, and
$275,303 during the fiscal years ended December 31, 1999, 1998, and 1997,
respectively. The Technology Leaders Fund paid brokerage commissions of $31,982,
$19,440 and $876 during the fiscal year and period ended December 31, 1999, 1998
and 1997, respectively. The Technology Innovators Fund paid brokerage
commissions of $67,099 and $1,050 during the fiscal year and period ended
December 31, 1999 and 1998. The Communications Fund and the e-Commerce Fund paid
brokerage commissions of $19,626 and $13,240, respectively, for the fiscal
period ended December 31, 1999.

PORTFOLIO TURNOVER

A Fund's portfolio turnover rate is calculated by dividing the lesser of
purchases or sales of portfolio securities for the fiscal year by the monthly
average of the value of the portfolio securities owned by the Fund during the
fiscal year. High portfolio turnover involves correspondingly greater brokerage
commissions and other transaction costs, which will be borne directly by a Fund
and could reduce a Fund's returns. A 100% turnover rate would occur if all of a
Fund's portfolio securities were replaced once within a one year period.

Generally, each Fund intends to invest for long-term purposes. However, the rate
of portfolio turnover will depend upon market and other conditions, and it will
not be a limiting factor when the Investment Adviser believes that portfolio
changes are appropriate. The turnover for a Fund is not expected to exceed 100%
annually.

PURCHASE, REDEMPTION AND PRICING OF SHARES

CALCULATION OF SHARE PRICE

The share price (net asset value) of the shares of each Fund is determined as of
the close of the regular session of trading on the New York Stock Exchange (the
"Exchange") (currently 4:00 p.m., eastern time), on each day the Trust is open
for business. The Trust is open for business on every day except Saturdays,
Sundays and the following holidays: New Year's Day, Martin Luther King, Jr. Day,
President's Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas. Because a Fund may have portfolio securities that
are listed on foreign exchanges that may trade on weekends or other days when a
Fund does not price its shares, the net asset value of a Fund's shares may
change on days when shareholders will not be able to purchase or redeem shares.
For a description of the methods used to determine the share price, see
"Calculation of Share Price" in the Prospectus.

In valuing a Fund's assets for the purpose of determining net asset value,
readily marketable portfolio securities listed on a national securities exchange
are valued at the last sale price on such exchange on the business day as of
which such value is being determined. If there has been no sale on such exchange
on such day, the security is valued at the closing bid price on such day. If no
bid price is quoted on such exchange on such day, then the security is valued by
such method as the Investment Adviser under the supervision of the Board of
Trustees determines in good faith to reflect its fair value. Readily marketable
securities traded only in the over-the-counter market are valued at the last
sale price, if available, otherwise at the most recent bid price. If no bid
price is quoted on such day, then the security is valued by such method as the
Investment Adviser under the supervision of the Board of Trustees determines in
good faith to reflect its fair value. All other assets of the Funds , including
restricted securities and securities that are not readily marketable, are valued
in such manner as the Investment Adviser under the supervision of the Board of
Trustees in good faith deems appropriate to reflect their fair value.

15
<PAGE>
PURCHASE OF SHARES

Properly completed orders for shares that are received by the Trust prior to the
close of business on the Exchange are priced at net asset value per share
computed as of the close of the regular session of trading on the Exchange on
that day. Properly completed orders received after the close of the Exchange, or
on a day it is not open for trading, are priced at the net asset value at the
close of the Exchange on the next day on which it is open for trading.

REDEMPTION OF SHARES

The right of redemption may not be suspended or the date of payment upon
redemption postponed for more than seven calendar days after the receipt of a
shareholder's redemption request is made in accordance with the procedures set
forth in the "How to Redeem Shares" section of the Prospectus, except (a) for
any period during which the Exchange is closed (other than customary weekend and
holiday closing) or during which the Securities and Exchange Commission
determines that trading thereon is restricted, (b) for any period during which
an emergency (as determined by the Securities and Exchange Commission) exists as
a result of which disposal by a Fund of securities owned by it is not reasonably
practicable or as a result of which it is not reasonably practicable for a Fund
to fairly determine the value of its net assets, or (c) for any other period
that the Securities and Exchange Commission may by order permit for the
protection of security holders of the Funds.

When a redemption is requested, the Trust will redeem all or any portion of your
shares of a Fund in accordance with the procedures set forth in the "How to
Redeem Shares" section of the Prospectus.

REDEMPTION IN KIND

As described in the Prospectus, payment of the net redemption proceeds may be
made either in cash or in portfolio securities (selected in the discretion of
the Investment Adviser under supervision of the Board of Trustees and taken at
their value used in determining the net asset value), or partly in cash and
partly in portfolio securities. If payment for shares redeemed is made wholly or
partly in portfolio securities, brokerage costs may be incurred by the investor
in converting the securities to cash.

TAXES

Each Fund has elected, and intends to qualify annually, for the special tax
treatment afforded regulated investment companies under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"). To qualify as a
regulated investment company, a Fund must, among other things, (a) derive in
each taxable year at least 90% of its gross income from dividend, interest,
payments with respect to securities loans, and gains from the sale or other
disposition of stock, securities or foreign currencies, or other income
(including gains from options, futures and forward contracts) derived with
respect to their business of investing in such stock, securities or currencies;
(b) diversify its holdings so that, at the end of each quarter of the taxable
year, (i) at least 50% of the market value of the Fund's assets are represented
by cash, U.S. Government securities, the securities of other regulated
investment companies, and other securities, with such other securities of any
one issuer limited for the purposes of this calculation to an amount not greater
than 5% of the value of the Fund's total assets or 10% of the outstanding voting
securities of such issuer, and (ii) not more than 25% of the value of its total
assets are invested in the securities of any one issuer (other than U.S.
Government securities or the securities of other regulated investment companies)
or in two or more issuers which the Funds control and which are engaged in the
same or similar trades or businesses; and (c) distribute at least 90% of its
investment company taxable income (which includes dividends, interest and net
short-term capital gains in excess of any net long-term capital losses) each
taxable year.

16
<PAGE>
As regulated investment companies, each Fund will not be subject to U.S. Federal
income tax on its investment company taxable income and net capital gains (any
long-term capital gains in excess of the sum of net short-term capital losses
and capital loss carryovers available from the eight prior years), if any, that
it distributes to shareholders. Each Fund intends to distribute annually to its
shareholders substantially all of its investment company taxable income and any
net capital gains. In addition, amounts not distributed by a Fund on a timely
basis in accordance with a calendar year distribution requirement are subject to
a nondeductible 4% excise tax. To avoid the tax, a Fund must distribute during
each calendar year an amount equal to the sum of (1) at least 98% of its
ordinary income (with adjustment) for the calendar year and (2) at least 98% of
its capital gains in excess of its capital losses (and adjusted for certain
ordinary losses) for the 12 month period ending on October 31 of the calendar
year, and (3) all ordinary income and capital gains for previous years that were
not distributed during such years. In order to avoid application of the excise
tax, each Fund intends to make distributions in accordance with these
distribution requirements.

In view of each Fund's investment policies, it is expected that dividends
received from domestic and certain foreign corporations will be part of each
Fund's gross income. Distributions by a Fund of such dividends to corporate
shareholders may be eligible for the "70% dividends received" deduction, subject
to the holding period and debt-financing limitations of the Code. However, the
portion of each Fund's gross income attributable to dividends received from
qualifying corporations is largely dependent on its investment activities for a
particular year and therefore cannot be predicted with certainty. In addition,
for purposes of the dividends received deduction available to corporations, a
capital gain dividend received from a regulated investment company is not
treated as a dividend. Corporate shareholders should be aware that availability
of the dividends received deduction is subject to certain restrictions. For
example, the deduction is not available if Fund shares are deemed to have been
held for less than 46 days (within the 90-day period that begins 45 days before
the ex-dividend date and ends 45 days after the ex-dividend date) and is reduced
to the extent such shares are treated as debt-financed under the Code.
Dividends, including the portions thereof qualifying for the dividends received
deduction, are includable in the tax base on which the federal alternative
minimum tax is computed. Dividends of sufficient aggregate amount received
during a prescribed period of time and qualifying for the dividends received
deduction may be treated as "extraordinary dividends" under the Code, resulting
in a reduction in a corporate shareholder's federal tax basis in its Fund
shares.

Because each Fund may invest in securities of foreign companies, a Fundmay be
liable for foreign withholding and other taxes, which will reduce the amount
available for distribution to shareholders. Tax conventions between the United
States and various other countries may reduce or eliminate such taxes. A foreign
tax credit or deduction is generally allowed for foreign taxes paid or deemed to
be paid. A regulated investment company may elect to have the foreign tax credit
or deduction claimed by its shareholders rather than the company if certain
requirements are met, including the requirement that more than 50% of the value
of the company's total assets at the end of the taxable year consist of
securities in foreign corporations. Because the Funds do not anticipate
investment in securities of foreign corporations to this extent, the Funds will
likely not be able to make this election and foreign tax credits will be allowed
only to reduce a Fund's tax liability, if any.

Under the Code, upon disposition of certain securities denominated in a foreign
currency, gains or losses attributable to fluctuations in the value of the
foreign currency between the date of acquisition of the securities and the date
of disposition are treated as ordinary gain or loss. These gains or losses,
referred to under the Code as "Section 988" gains or losses, may increase or
decrease the amount of a Fund's investment company taxable income.

Any dividend or distribution received shortly after a share purchase will have
the effect of reducing the net asset value of such shares by the amount of such
dividend or distribution. Such dividend or distribution is fully taxable.
Accordingly, prior to purchasing shares of the Funds, an investor should
carefully consider the amount of dividends or capital gains distributions that
are expected to be or have been announced.

17
<PAGE>
Generally, the Code's rules regarding the determination and character of gain or
loss on the sale of a capital asset apply to a sale, exchange, redemption or
repurchase of shares of the Funds that are held by the shareholder as capital
assets. However, if a shareholder sells shares of the Funds which he has held
for less than six months and on which he has received distributions of capital
gains, any loss on the sale or exchange of such shares must be treated as
long-term capital loss to the extent of such distributions. Any loss realized on
the sale of shares of the Funds will be disallowed by the "wash sale" rules to
the extent the shares sold are replaced (including through the receipt of
additional shares through reinvested dividends) within a period of time
beginning 30 days before and ending 30 days after the shares are sold. In such a
case, the basis of the shares acquired will be adjusted to reflect the
disallowed loss.

The Trust is required to withhold and remit to the U.S. Treasury a portion (31%)
of dividend income on any account unless the shareholder provides a taxpayer
identification number and certifies that such number is correct and that the
shareholder is not subject to backup withholding.

Provided that a Fund qualifies as a regulated investment company under the Code,
it will not be liable for California corporate taxes, other than a minimum
franchise tax, if all of its income is distributed to shareholders for each
taxable year. Shareholders, however, may be liable for state and local income
taxes on distributions from the Funds.

The above discussion and the related discussion in the Prospectus are not
intended to be complete discussions of all federal tax consequences applicable
to an investment in the Funds. Nonresident aliens and foreign persons are
subject to different tax rules, and may be subject to withholding of up to 30%
on certain payments received from the Funds. Shareholders are advised to consult
with their own tax advisors concerning the application of foreign, federal,
state and local taxes to an investment in the Funds.

HISTORICAL PERFORMANCE INFORMATION

A Fund's total returns are based on the overall dollar or percentage change in
value of a hypothetical investment in the Fund, assuming all dividends and
distributions are reinvested. Average annual total return reflects the
hypothetical annually compounded return that would have produced the same
cumulative total return if the Fund's performance had been constant over the
entire period presented. Because average annual total returns tend to smooth out
variations in the Fund's returns, investors should recognize that they are not
the same as actual year-by-year returns.

For the purposes of quoting and comparing the performance of the Funds to that
of other mutual funds and to other relevant market indices in advertisements,
performance will be stated in terms of average annual total return. Under
regulations adopted by the Securities and Exchange Commission, funds that intend
to advertise performance must include average annual total return quotations
calculated according to the following formula:

P(1+T)(to the power of n) = ERV

Where:

<TABLE>
<S> <C> <C>
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years (1, 5, or 10)
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1-, 5-, or 10-year period, at
the end of such period (or fractional portion thereof).
</TABLE>

18
<PAGE>
Under the foregoing formula, the time periods used in advertising will be based
on rolling calendar quarters, updated to the last day of the most recent quarter
prior to submission of the advertising for publication, and will cover 1-, 5-,
and 10-year periods of a Fund's existence or shorter periods dating from the
commencement of the Fund's operations. In calculating the ending redeemable
value, all dividends and distributions by the Fund are assumed to have been
reinvested at net asset value as described in the Prospectus on the reinvestment
dates during the period. Additionally, redemption of shares is assumed to occur
at the end of each applicable time period.

The foregoing information should be considered in light of a Fund's investment
objectives and policies, as well as the risks incurred in the Fund's investment
practices. Future results will be affected by the future composition of a Fund's
portfolio, as well as by changes in the general level of interest rates, and
general economic and other market conditions.

The average annual total returns of the Funds for the periods ended
December 31, 1999 are as follows:

Technology Value Fund:
1-Year.................................................... 190.40%
5-Year.................................................... 58.15%
Since inception (May 20, 1994)............................ 56.53%
Since SEC effective date (December 15, 1994).............. 59.23%

Technology Leaders Fund:
1-Year.................................................... 152.58%
Since inception (December 10, 1997)....................... 108.22%

Technology Innovators Fund:
1-Year.................................................... 212.34%
Since inception (May 20, 1998)............................ 170.21%

Communications Fund
Since inception (September 30, 1999) (not annualized)..... 46.50%

e-Commerce Fund
Since inception (September 30, 1999) (not annualized)..... 48.60%
</TABLE>

Each Fund may also advertise total return (a "nonstandardized quotation") which
is calculated differently from average annual total return. A nonstandardized
quotation of total return may be a cumulative return which measures the
percentage change in the value of an account between the beginning and end of a
period, assuming no activity in the account other than reinvestment of dividends
and capital gains distributions.

The Technology Value Fund's total returns as calculated in this manner for the
periods ended December 31 are as follows:

<TABLE>
<CAPTION>
PERIOD ENDED TOTAL RETURN
------------ ------------
<S> <C>
December 31, 1994*.......................................... 17.00%
December 31, 1994**......................................... (1.43%)
December 31, 1995........................................... 61.17%
December 31, 1996........................................... 60.55%
December 31, 1997........................................... 6.46%
December 31, 1998........................................... 23.71%
December 31, 1999........................................... 190.40%
</TABLE>

19
<PAGE>
The Technology Leaders Fund's total returns as calculated in this manner for the
periods ended December 31 are as follows:

<TABLE>
<CAPTION>
PERIOD ENDED TOTAL RETURN
------------ ------------
<S> <C>
December 31, 1997........................................... .70%
December 31, 1998........................................... 78.15%
December 31, 1999........................................... 152.58%
</TABLE>

The Technology Innovators Fund's total returns as calculated in this manner for
the periods ended December 31 are as follows:

<TABLE>
<CAPTION>
PERIOD ENDED TOTAL RETURN
------------ ------------
<S> <C>
December 31, 1998........................................... 60.10%
December 31, 1999........................................... 212.34%
</TABLE>

The Communications Fund's total return as calculated for the period-ended
December 31, 1999 is as follows:

<TABLE>
<CAPTION>
PERIOD ENDED*** TOTAL RETURN
--------------- ------------
<S> <C>
December 31, 1999........................................... 46.50%
</TABLE>

The e-Commerce Fund's total return as calculated for the period-ended
December 31, 1999 is as follows:

<TABLE>
<CAPTION>
PERIOD ENDED*** TOTAL RETURN
--------------- ------------
<S> <C>
December 31, 1999........................................... 48.60%
</TABLE>

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

*Since inception (May 20, 1994).

**Since SEC-effectiveness (December 15, 1994).

***Since inception (September 30, 1999).

A nonstandardized quotation may also indicate average annual compounded rates of
return over periods other than those specified for average annual total return.
A nonstandardized quotation of total return will always be accompanied by a
Fund's average annual total return as described above.

The performance quotations described above are based on historical earnings and
are not intended to indicate future performance of the Funds.

To help investors better evaluate how an investment in a Fund might satisfy
their investment objective, advertisements regarding each Fund may discuss
various measures of Fund performance, including current performance ratings
and/or rankings appearing in financial magazines, newspapers and publications
that track mutual fund performance. Advertisements may also compare performance
(using the calculation methods set forth in the Prospectus) to performance as
reported by other investments, indices and averages. When advertising current
ratings or rankings, the Funds may use the following publications or indices to
discuss or compare Fund performance:

Both Morningstar Principia Pro and Lipper Mutual Fund Performance Analysis
measure total return and average current yield for the mutual fund industry and
rank individual mutual fund performance over specified time periods assuming
reinvestment of all distributions, exclusive of sales loads. The Funds may
provide comparative performance information appearing in any appropriate
category published by Morningstar, Inc., or by Lipper Analytical Services, Inc.
In addition, the Funds may use comparative performance information of relevant
indices, including the S&P 500 Index, the Dow Jones Industrial Average, the
Russell 2000 Index, the NASDAQ Composite Index and the Value Line Composite
Index. The S&P 500 Index is an unmanaged index of 500 stocks, the purpose of
which is to portray the pattern of

20
<PAGE>

common stock price movement. The Dow Jones Industrial Average is a measurement
of general market price movement for 30 widely held stocks listed primarily on
the Exchange. The Russell 2000 Index, representing approximately 8% of the total
market capitalization of the Russell 3000 Index, is an unmanaged index comprised
of the 2,000 smallest U.S. domiciled publicly-traded common stocks in the
Russell 3000 Index (an unmanaged index of the 3,000 largest U.S. domiciled
publicly-traded common stocks by market capitalization representing
approximately 98% of the investable U.S. equity market). The NASDAQ Composite
Index is an unmanaged index that averages the trading prices of more than almost
5,000 domestic companies. The Value Line Composite Index is an unmanaged
equal-weighted index comprised of approximately 1,700 stocks, the purpose of
which is to portray the pattern of common stock price movement.

In assessing such comparisons of performance an investor should keep in mind
that the composition of the investments in the reported indices and averages is
not identical to the composition of the Funds' portfolios, that the averages are
generally unmanaged and that the items included in the calculations of such
averages may not be identical to the formula used by the Funds to calculate
their performance. In addition, there can be no assurance that the Funds will
continue this performance as compared to such other averages.

PRINCIPAL SECURITY HOLDERS

As of November 3, 2000 the following persons owned of record 5% or more of the
shares of the Funds:

THE TECHNOLOGY VALUE FUND:

<TABLE>
<CAPTION>
NAME % OWNERSHIP SHARES
---- ----------- ---------------
<S> <C> <C>
Charles Schwab & Co., Inc. ................................. 38.02% 14,866,615.1940
FBOC
101 Montgomery Street
San Francisco, California 94104-4122

National Financial Services Corp. .......................... 23.74% 9,284,022.2440
FBOC
200 Liberty St. 5th Floor
New York, New York 10281-1003

National Investors Services Corp. .......................... 6.83% 2,669,931.3300
FBOC
Mutual Funds Department
55 Water Street, 32nd Floor
New York, New York 10041-3299

Pershing & Co. ............................................. 5.40% 2,109,872.5690
FBOC
Attn: Barbara Capasso
P.O. Box 2052
Jersey City, New Jersey 07303-2052
</TABLE>

THE TECHNOLOGY LEADERS FUND:

<TABLE>
<S> <C> <C>
Charles Schwab & Co., Inc. ................................. 40.56% 6,443,591.5350
FBOC
101 Montgomery Street
San Francisco, California 94104-4122
</TABLE>

21
<PAGE>

<TABLE>
<CAPTION>
NAME % OWNERSHIP SHARES
---- ----------- ---------------
<S> <C> <C>
National Financial Services Corp. .......................... 21.32% 3,387,279.4320
FBOC
200 Liberty Street, 5th Floor
New York, New York 10281-1003

Donaldson Lufkin & Jenrette SECS ........................... 6.46% 1,025,703.0850
FBOC
Attn Barbara Capasso
P.O. Box 2052
Jersey City, New Jersey 07303-2052
</TABLE>

THE TECHNOLOGY INNOVATORS FUND:

<TABLE>
<S> <C> <C>
Charles Schwab & Co., Inc. ................................. 42.68% 5,118,542.0490
FBOC
101 Montgomery Street
San Francisco, California 94104-4122

National Financial Services Corp. .......................... 21.81% 2,615,320.4640
FBOC
200 Liberty St. 5th Floor
New York, New York 10281-1003

National Investor Services Corp. ........................... 7.47% 896,057.1370
FBOC
Mutual Funds Department
55 Water Street, 32nd Floor
New York, New York 10041-3299

Donaldson Lufkin & Jenrette Securities ..................... 5.33% 639,645.0830
Attn: Barbara Capasso
P. O. Box 2052
Jersey City, New Jersey 07303-2052
</TABLE>

THE COMMUNICATIONS FUND:

<TABLE>
<S> <C> <C>
Charles Schwab & Co., Inc. ................................. 33.94% 11,042,352.7760
FBOC
101 Montgomery Street
San Francisco, California 94104-4122

National Financial Services Corp. .......................... 28.24% 9,186,569.6150
FBOC
200 Liberty Street 5th Floor
New York, New York 10281-1003

National Investor Services Corp. ........................... 7.92% 2,577,781.1170
FBOC
Mutual Funds Department
55 Water Street, 32nd Floor
New York, New York 10041-3299
</TABLE>

22
<PAGE>

<TABLE>
<CAPTION>
NAME % OWNERSHIP SHARES
---- ----------- ---------------
<S> <C> <C>
THE E-COMMERCE FUND:

Charles Schwab & Co., Inc. ................................. 35.92% 12,999,100.6170
FBOC
101 Montgomery Street
San Francisco, California 94104-4122

National Financial Services Corp. .......................... 23.01% 8,326,474.8490
FBOC
200 Liberty Street 5th Floor
New York, New York 10281-1003

National Investor Services Corp. ........................... 6.91% 2,499,874.9310
FBOC
55 Water Street, 32nd Floor
New York, New York 10041-3299
</TABLE>

THE GLOBAL TECHNOLOGY FUND:

<TABLE>
<S> <C> <C>
Charles Schwab & Co., Inc. ................................. 31.64% 4,482,844.1900
FBOC
101 Montgomery Street
San Francisco, California 94104-4122

National Financial Services Corp. .......................... 18.38% 2,604,783.1650
FBOC
200 Liberty Street 5th Floor
New York, New York 10281-1003
</TABLE>

Charles Schwab & Co., a corporation organized in California, may be deemed to
control each of the Funds. For purposes of voting on matters submitted to
shareholders, any person who owns more than 50% of the outstanding shares of a
Fund generally would be able to cast the deciding vote.

As of November 3, 2000, the Trustees and officers of the Trust owned of record
or beneficially less than 1% of each Fund's outstanding shares.

CUSTODIAN

State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts
02110, has been retained to act as Custodian for each Fund's investments. State
Street Bank and Trust Company acts as each Fund's depository, safe-keeps the
portfolio securities, collects all income and other payments with respect
thereto, disburses funds as instructed and maintains records in connection with
its duties.

LEGAL COUNSEL AND AUDITORS

The law firm of Morrison & Foerster LLP, 2000 Pennsylvania Avenue., NW,
Washington, DC 20006, acts as legal counsel for the Trust and the Trust's
independent Trustees.

The firm of Tait, Weller & Baker, 8 Penn Center Plaza, Philadelphia,
Pennsylvania 19103, has been selected as independent auditors for the Trust for
the fiscal year ending December 31, 1999. Tait, Weller & Baker performs an
annual audit of the Trust's financial statements and will advise the Trust as to
certain accounting matters.

23
<PAGE>
STATE STREET BANK AND TRUST COMPANY

State Street Bank and Trust Company ("State Street"), 225 Franklin Street,
Boston, Massachusetts 02110, is retained by the Investment Adviser to maintain
the records of each shareholder's account, process purchases and redemptions of
the Funds' shares and act as dividend and distribution disbursing agent. State
Street also provides sub-administrative services to each Fund, calculates daily
net asset value per share and maintains such books and records as are necessary
to enable State Street to perform its duties. For the performance of these
services, the Investment Adviser (not the Funds) pays State Street (1) a fee for
sub-administrative services at the annual rate of 0.03% of the first $1 billion
of the Trust's average daily net assets, 0.025% of the next $1 billion of the
Trust's average daily net assets, 0.02% of the next $1 billion of the Trust's
average daily net assets, 0.015% of the next $2 billion of the Trust's average
daily net assets, and 0.010% of the average daily net assets of the Trust
thereafter; (2) a fee for transfer agency and shareholder services at the annual
rate of 0.02% of the Trust's average daily net assets; and (3) a fee for
accounting and pricing services at the annual rate of 0.0125% of the first
$1 billion of the Trust's average daily net assets, 0.01% of the next
$1 billion of the Trust's average daily net assets, 0.005% of the next
$1 billion of the Trust's average daily net assets, and 0.0025% of the Trust's
average daily net assets thereafter.

FINANCIAL STATEMENTS

Financial statements for the Funds for the period ended June 30, 2000, as
contained in the Semi-annual Report to Shareholders and for the period ended
December 31, 1999, as contained in the Annual Report to Shareholders, are
incorporated herein by this reference.

Financial statements for the Global Technology Fund are not available because
this Fund had not been in existence for at least six months as of the date of
this SAI.

24
<PAGE>

--------------------------------------------------------------------------------
PART C

OTHER INFORMATION
--------------------------------------------------------------------------------

<PAGE>

PART C

Other Information
--------------------------------------------------------------------------------

Firsthand Funds

Form N-1A

Part C

Item 23. Exhibits.

(a) Declaration of Trust

(i) Declaration of Trust - Incorporated by reference to Post-Effective
Amendment No. 7 to the Registrant's Registration Statement as filed
with the Securities and Exchange Commission (the "SEC") on May 11,
1999 ("Post-Effective Amendment No. 7").

(ii) Amendments to Declaration of Trust as adopted on February 14, 1998 -
Incorporated by reference to Post-Effective Amendment No. 7.

(b) Bylaws

(i) By-Laws - Incorporated by reference to Post-Effective Amendment No. 7.

(ii) Amendments to By-Laws as adopted on February 14, 1998 - Incorporated
by reference to Post-Effective Amendment No. 7.

(d) Form of Investment Advisory Agreement - Incorporated by reference to
Post-Effective Amendment No. 10 to the Registrant's Registration Statement
as filed with the SEC on September 30, 1999 ("Post-Effective Amendment No.
10").

(e) Distribution Agreement with ALPS Mutual Funds Services, Inc. - Incorporated
by reference to Post-Effective Amendment No. 14 to the Registrant's
Registration Statement as filed with the SEC on August 18, 2000
("Post-Effective Amendment No. 14").

(f) Bonus or Profit Sharing Contracts - Not Applicable.

(g) Custody Agreement with State Street Bank and Trust Company - Incorporated
by reference to Post-Effective Amendment No. 14.

(h) Other Material Contracts

(i) Form of Administration Agreement with Firsthand Capital Management,
Inc. - Incorporated by reference to Post-Effective Amendment No. 12.

(ii) Transfer Agency and Service Agreement with State Street Bank and Trust
Company, dated March 15, 2000 - Incorporated by reference to
Post-Effective Amendment No. 12.

(iii) Administration Agreement between Firsthand Capital Management, Inc.
and State Street Bank and Trust Company, dated April 30, 2000 -
Incorporated by reference to Post-Effective Amendment No. 12.

(iv) Investment Accounting Agreement with State Street Bank and Trust
Company, dated April 30, 2000 - Incorporated by reference to
Post-Effective Amendment No. 12.

<PAGE>

(i) Opinion and Consent of Counsel relating to Issuance of Shares - Not
Applicable.

(j) Other Opinions - Consent of Independent Certified Public Accountants -
Filed herewith.

(k) Omitted Financial Statements - Not Applicable.

(l) Agreement Relating to Initial Capital - Incorporated by reference to
Registration Statement on Form N-1A.

(m) Rule 12b-1 Plan - Not Applicable.

(n) Rule 18f-3 Plan - Not Applicable.

(p) Codes of Ethics.

(i) Code of Ethics for Firsthand Capital Management, Inc., dated March 16,
2000 - Incorporated by reference to Post-Effective Amendment No. 12.

(ii) Code of Ethics for ALPS Mutual Funds Services, Inc., dated May 1999
and revised March 1, 2000 - Incorporated by reference to
Post-Effective Amendment No. 12.

Item 24. Persons Controlled by or Under Common Control with Registrant.

No person is directly or indirectly controlled by or under common control with
the Registrant.

Item 25. Indemnification.

Under section 3817(a) of the Delaware Business Trust Act, a Delaware business
trust has the power to indemnify and hold harmless any trustee, beneficial owner
or other person from and against any and all claims and demands whatsoever.
Reference is made to sections 5.1 and 5.2 of the Declaration of Trust of
Firsthand Funds (formerly known as Interactive Investments) (the "Trust")
pursuant to which no trustee, officer, employee or agent of the Trust shall be
subject to any personal liability, when acting in his or her individual
capacity, except for his own bad faith, willful misfeasance, gross negligence or
reckless disregard of his or her duties. The Trust shall indemnify each of its
trustees, officers, employees and agents against all liabilities and expenses
reasonably incurred by him or her in connection with the defense or disposition
of any actions, suits or other proceedings by reason of his or her being or
having been a trustee, officer, employee or agent, except with respect to any
matter as to which he or she shall have been adjudicated to have acted in or
with bad faith, willful misfeasance, gross negligence or reckless disregard of
his or her duties. The Trust will comply with Section 17(h) of the Investment
Company Act of 1940, as amended (the "1940 Act") and 1940 Act Releases number
7221 (June 9, 1972) and number 11330 (September 2, 1980).

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to trustees, officers and controlling persons of the Trust
pursuant to the foregoing, the Trust has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy and therefore may be unenforceable. In the event that a claim for
indemnification (except insofar as it provides for the payment by the Trust of
expenses incurred or paid by a trustee, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted against the
Trust by such trustee, officer or controlling person and the Securities and
Exchange Commission is still of the same opinion, the Trust will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a

<PAGE>

court of appropriate jurisdiction the question of whether such indemnification
by it is against public policy as expressed in the Securities Act of 1933 and
will be governed by the final adjudication of such issue.

Indemnification provisions exist in the Advisory Agreement, the Administration
Agreement and the Underwriting Agreement that are substantially identical to
those in the Declaration of Trust noted above.

The Trust maintains a standard mutual fund and investment advisory professional
and directors and officers liability policy. The policy provides coverage to the
Trust, its Trustees and officers, and its Investment Adviser. Coverage under the
policy includes losses by reason of any act, error, omission, misstatement,
misleading statement, neglect or breach of duty.

Item 26. Business and Other Connections of the Investment Adviser.

Not Applicable.

Item 27. Principal Underwriters.

(a) ALPS Mutual Funds Services, Inc. acts as underwriter for the following
open-end investment companies: Financial Investors Trust (this includes FIT
Funds, Aristata Funds, and United Association S&P 500 Index Fund), First
Funds, Westcore Funds, Stonebridge Funds, and Holland Balanced Fund. ALPS
Mutual Funds Services, Inc. also acts as underwriter for the following
exchange traded funds: Select Sector SPDRs Trust, Diamonds Trust, Mid Cap
SPDR Trust, and SPDR Trust.

(b) The following list sets forth the directors and executive officers of the
Distributor, as well as the address for each person.

<TABLE>
<CAPTION>
NAME AND ADDRESS TITLE POSITION WITH
REGISTRANT
<S> <C> <C>
W. R. Alexander Secretary, Director None
370 17th Street, Suite 3100
Denver, CO 80202

Arthur J. Lucey President, Director None
370 17th Street, Suite 3100
Denver, CO 80202

Edmund J. Burke Executive Vice President, None
370 17th Street, Suite 3100 Director
Denver, CO 80202

Thomas Carter Chief Financial Officer and None
370 17th Street, Suite 3100 Treasurer
Denver, CO 80202

Jeremy O. May Vice President, Director of None
370 17th Street, Suite 3100 Mutual Funds
Denver, CO 80202 Operations and Assistant
Secretary

<PAGE>

Robert Szydlowski Vice President of Information None
370 17th Street, Suite 3100 Systems
Denver, CO 80202

Rick A. Pederson Director None
Frederick Ross Company
[730] 17th Street, Suite 500
Denver, CO 80202

Chris Woessner Director None
Loomis Sayles & Co., LP
555 California Street, Suite 2750
San Francisco, CA 94104

John W. Hannon, Jr. Director None
Seven Lakes
Box 2233
West End, NC 27376
</TABLE>

Item 28. Location of Accounts and Records.

Accounts, books and other documents required to be maintained by Section 31(a)
of the 1940 Act, and the Rules promulgated thereunder, will be maintained as
follows:

For the Investment Adviser - 125 South Market, Suite 1200, San Jose, CA 95113;

For the Administrator - 125 South Market, Suite 1200, San Jose, CA 95113, and
225 Franklin St., Boston, MA 02111;

For Investment Accounting, Custody, and Transfer Agent - 225 Franklin St.,
Boston, MA 02111; and

For Distribution - 370 17th St., Suite 3100, Denver, CO 80202.

Item 29. Management Services Not Discussed in Parts A and B.

Not Applicable.

Item 30. Undertakings.

Not Applicable.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, and the
Investment Company Act of 1940, as amended, the Registrant certifies that it
meets all of the requirements for effectiveness of this registration statement
under Rule 485(b) under the Securities Act and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Jose and the State of California on the 29th
of November, 2000.

FIRSTHAND FUNDS

By: /s/ Omar Billawala
------------------
Omar Billawala, Secretary

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the date(s) indicated.

<TABLE>
<S> <C> <C>
-------------------------
Michael Lynch* Trustee November 29, 2000

-------------------------
Jerry Wong* Trustee November 29, 2000

-------------------------
Kevin Landis* Chairman of the Board of Trustees November 29, 2000

-------------------------
Yakoub Bellawala* Treasurer November 29, 2000
</TABLE>

*By: /s/ Omar Billawala
------------------
Omar Billawala, attorney-in-fact pursuant to powers of attorney

<PAGE>

FIRSTHAND FUNDS

PART C - EXHIBIT LIST FOR POST-EFFECTIVE AMENDMENT 15 AS FILED ON NOVEMBER 30,
2000

Item

23 (j) Consent of Independent Certified Public Accountants.