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VAN KAMPEN REAL ESTATE SECURITIES FUND
SUPPLEMENT DATED AUGUST 28, 1998 TO THE PROSPECTUS DATED APRIL 30, 1998,
AS PREVIOUSLY SUPPLEMENTED ON JULY 14, 1998.
The prospectus, as previously supplemented, is being further amended and
supplemented to reflect the Board of Trustees appointment of Morgan Stanley
Asset Management Inc. ("MSAM") as Subadviser to the Fund effective October 1,
1998. The addition of MSAM will not impact the Fund's portfolio management team
or the day to day management of the Fund and will not result in any increase of
the Fund's expenses. The Prospectus is amended and supplemented as follows:
The section of the Prospectus captioned "Prospectus Summary" is hereby
amended with the following:
INVESTMENT ADVISERS. Van Kampen Asset Management Inc. (the "Adviser") is the
Fund's investment adviser. Morgan Stanley Asset Management Inc. (the
"Subadviser") provides sub-advisory services to the Adviser.
The first and second paragraphs of the section of the Prospectus captioned
"INVESTMENT ADVISORY SERVICES" is hereby supplemented with the following:
ADVISORY AGREEMENTS. The Fund retains the Adviser to manage the investment
of its assets and to place orders for the purchase and sale of its portfolio
securities. The Adviser has entered into a sub-advisory agreement (the
"Sub-advisory Agreement") with the Subadviser to assist it in performing its
investment advisory functions. Under an investment advisory agreement between
the Adviser and the Fund (the "Advisory Agreement"), the Fund pays the Adviser a
monthly fee computed on average daily net assets of the Fund at the annual rate
of 1.00% of the Fund's average daily net assets. This fee is higher than that
charged by most other mutual funds but the Fund's Trustees believe it is
justified by the special international nature of the Fund and its asset
allocation features and it is not necessarily higher than the fees charged by
certain mutual funds with an investment objective and investment policies
similar to those of the Fund. Under the Advisory Agreement, the Fund also
reimburses the Adviser for the cost of the Fund's accounting services, which
include maintaining its financial books and records and calculating its daily
net asset value. Operating expenses paid by the Fund include shareholder service
agency fees, service fees, distribution fees, custodian fees, legal and
accounting fees, the costs of reports and proxies to shareholders, trustees'
fees (other than those who are affiliated persons as defined in the 1940 Act of
the Adviser, Distributor, Investor Services, Van Kampen or Morgan Stanley Dean
Witter & Co.), and all other business expenses not specifically assumed by the
Adviser. Advisory (management) fees and total operating expense ratios are shown
under the caption "Annual Fund Operating Expenses and Example" herein.
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Pursuant to the Sub-advisory Agreement, the Subadvisory receives on an annual
basis 50% of the compensation received by the Adviser.
From time to time as the Adviser, the Subadviser or the Distributor may deem
appropriate, they may voluntarily undertake to reduce the Fund's expenses by
reducing the fees payable to them to the extent of, or bearing expenses in
excess of, such limitations as they may be established.
The section of the Prospectus captioned "INVESTMENT ADVISORY SERVICES"
hereby is supplemented by adding the following:
THE SUBADVISER. The Subadviser is a wholly-owned subsidiary of Morgan
Stanley Group, Inc. and is an affiliate of the Adviser. The Subadviser provides
portfolio management and named fiduciary services to various closed-end and
open-end investment companies, taxable and nontaxable institutions,
international equities and fixed income securities. At June 30, 1998, the
Subadviser had, together with its affiliated investment management companies,
assets under management (including assets under fiduciary advisory control)
totaling approximately $167 billion. The Subadviser is a leader in the real
estate capital markets with 25 years of real estate financing experience. The
Subadviser has dedicated over 200 employees worldwide to real estate securities
research and market analysis and manages over $4 billion in private real estate
investment partnerships. The Subadviser also draws upon the research
capabilities of Morgan Stanley Group Inc. and its other affiliates as well as
the research and investment ideas of other companies whose brokerage services
the Subadviser utilizes. The address of the Subadviser is 1221 Avenue of the
Americas, New York, New York 10020.
REAL SPT 898
