JPM ADVISOR FUNDS, 485BPOS, 1995-09-29

JPM ADVISOR FUNDS
485BPOS, 1995-09-29

Previous: UNITED ASSET STRATEGY FUND INC, 497, 1995-09-29

Next: DEAN WITTER GLOBAL ASSET ALLOCATION FUND, NSAR-A, 1995-09-29

<PAGE>
As filed with the Securities and Exchange Commission on September 29, 1995
Registration Nos. 33-84798; 811-8794

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 1

AND

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 3

THE JPM ADVISOR FUNDS
(Exact Name of Registrant as Specified in Charter)

6 St. James Avenue
Boston, Massachusetts 02116
(Address of Principal Executive Offices)

Registrant's Telephone Number, including Area Code: (617) 423-0800

Philip W. Coolidge
6 St. James Avenue, Boston, Massachusetts 02116
(Name and Address of Agent for Service)

Copy to:
Stephen K. West, Esq.
Sullivan & Cromwell
125 Broad Street, New York, New York 10004

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

[ ] Immediately upon filing pursuant to paragraph (b)
[X] on October 1, 1995 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(i)
[ ] on (date) pursuant to paragraph (a)(i)
[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on (date) pursuant to paragraph (a)(ii) of rule 485.

If appropriate, check the following box:

[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

The Registrant has previously registered an indefinite number of its shares
under the Securities Act of 1933, as amended, pursuant to Rule 24f-2 under the
Investment Company Act of 1940, as amended. The Registrant has not filed Rule
24f-2 notices with respect to The JPM Advisor U.S. Equity Fund or The JPM
Advisor U.S. Small Cap Equity Fund, each a series of the Registrant, because the
Registrant has not sold any securities during the fiscal year ended May 31,
1995.

The U.S. Fixed Income Portfolio, The Non-U.S. Fixed Income Portfolio, The
Selected U.S. Equity Portfolio, The U.S. Small Company Portfolio, The Non-U.S.
Equity Portfolio, The Emerging Markets Equity Portfolio and The Series Portfolio
have also executed this Registration Statement.

JPM470.EDG
<PAGE>

CROSS-REFERENCE SHEET
(As Required by Rule 495)

PART A ITEM NO.: Prospectus Headings.

1. COVER PAGE: Cover Page.

2. SYNOPSIS: Investors for Whom the Fund is Designed.

3. CONDENSED FINANCIAL INFORMATION: Not applicable.

4. GENERAL DESCRIPTION OF REGISTRANT: Cover Page; Investors for Whom the
Fund is Designed; Investment Objective and Policies; Risk Factors and
Additional Investment Information; Investment Restrictions; Special
Information Concerning Hub and Spoke(R); Organization; Appendix.

5. MANAGEMENT OF THE FUND: Management of the Trust and the Portfolio;
Shareholder Transactions; Additional Information.

5A. MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE: Not applicable.

6. CAPITAL STOCK AND OTHER SECURITIES: Special Information Concerning Hub
and Spoke(R); Shareholder Transactions; Net Asset Value; Purchase of
Shares; Taxes; Dividends and Distributions; Organization.

7. PURCHASE OF SECURITIES BEING OFFERED: Purchase of Shares; Exchange of
Shares; Investors for Whom the Fund is Designed; Dividends and
Distributions; Net Asset Value.

8. REDEMPTION OR REPURCHASE: Redemption of Shares; Exchange of Shares; Net
Asset Value.

9. PENDING LEGAL PROCEEDINGS: Not applicable.

PART B ITEM NO.: Statement of Additional Information Headings.

10. COVER PAGE: Cover Page.

11. TABLE OF CONTENTS: Table of Contents.

12. GENERAL INFORMATION AND HISTORY: General.

13. INVESTMENT OBJECTIVES AND POLICIES: Investment Objectives and Policies;
Additional Investments; Investment Restrictions; Quality and
Diversification Requirements; Appendix A; Appendix B.

14. MANAGEMENT OF THE FUND: Trustees and Officers.

15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES: Description of
Shares.

16. INVESTMENT ADVISORY AND OTHER SERVICES: Investment Advisor;
Administrator and Distributor; Services Agent; Custodian; Independent
Accountants; Expenses.

17. BROKERAGE ALLOCATION AND OTHER PRACTICES: Portfolio Transactions.

18. CAPITAL STOCK AND OTHER SECURITIES: Massachusetts Trust; Description of
Shares.

19. PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED: Net Asset
Value; Purchase of Shares; Redemption of Shares; Exchange of Shares;
Dividends and Distributions.

20. TAX STATUS: Taxes.

21. UNDERWRITERS: Administrator and Distributor.

22. CALCULATION OF PERFORMANCE DATA: Performance Data.

23. FINANCIAL STATEMENTS: Financial Statements.

PART C

Information required to be included in Part C is set forth under the
appropriately numbered in Part C of this registration statement.

<PAGE>
EXPLANATORY NOTE

This post-effective amendment no. 1 (the "Amendment") to the Registrant's
registration statement on Form N-1A (File no. 33-84798) (the "Registration
Statement") is being filed with respect to The JPM Advisor U.S. Small Cap Equity
Fund and The JPM Advisor U.S. Equity Fund (the "Funds"), to include updated
financial and other disclosure in (i) the Statement of Additional Information
and (ii) the prospectuses which describe the Funds. As a result, the Amendment
does not affect any of the Registrant's other currently effective prospectuses,
each of which is hereby incorporated herein by reference as most recently filed
pursuant to Rule 497 under the Securities Act of 1933, as amended.

<PAGE>

PROSPECTUS

The JPM Advisor U.S. Small Cap Equity Fund
6 St. James Avenue
Boston, Massachusetts 02116
For information call (800) JPM-3637

The JPM Advisor U.S. Small Cap Equity Fund (the "Fund") seeks to provide a
high total return from a portfolio of equity securities of small companies. It
is designed for investors who are willing to assume the somewhat higher risk
of investing in small companies in order to seek a higher total return over
time than might be expected from a portfolio of stocks of large companies.

The Fund is a diversified no-load mutual fund for which there are no sales
charges or exchange or redemption fees. The Fund is a series of The JPM Advi-
sor Funds, an open-end management investment company organized as a Massachu-
setts business trust (the "Trust").

UNLIKE OTHER MUTUAL FUNDS WHICH DIRECTLY ACQUIRE AND MANAGE THEIR OWN PORTFO-
LIO OF SECURITIES, THE FUND SEEKS TO ACHIEVE ITS INVESTMENT OBJECTIVE BY IN-
VESTING ALL OF ITS INVESTABLE ASSETS IN THE U.S. SMALL COMPANY PORTFOLIO (THE
"PORTFOLIO"), A CORRESPONDING DIVERSIFIED OPEN-END MANAGEMENT INVESTMENT COM-
PANY HAVING THE SAME INVESTMENT OBJECTIVE AS THE FUND. THE FUND INVESTS IN THE
PORTFOLIO THROUGH SIGNATURE FINANCIAL GROUP, INC.'S HUB AND SPOKE(R) FINANCIAL
SERVICES METHOD. HUB AND SPOKE(R) EMPLOYS A TWO-TIER MASTER-FEEDER STRUCTURE
AND IS A REGISTERED SERVICE MARK OF SIGNATURE FINANCIAL GROUP, INC. SEE SPE-
CIAL INFORMATION CONCERNING HUB AND SPOKE(R) ON PAGE 2.

The Portfolio is advised by Morgan Guaranty Trust Company of New York ("Mor-
gan" or the "Advisor").

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing and it should be retained
for future reference. Additional information about the Fund has been filed
with the Securities and Exchange Commission in a Statement of Additional In-
formation dated October 1, 1995 (as supplemented from time to time). This in-
formation is incorporated herein by reference and is available without charge
upon written request from the Fund's Distributor, Signature Broker-Dealer
Services, Inc., 6 St. James Avenue, Boston, Massachusetts 02116, Attention:
The JPM Advisor Funds, or by calling (800) 847-9487.

INVESTMENTS IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, MORGAN GUARANTY TRUST COMPANY OF NEW YORK OR ANY OTHER BANK.
SHARES OF THE FUND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN
INVESTMENT IN THE FUND IS SUBJECT TO RISK THAT MAY CAUSE THE VALUE OF THE IN-
VESTMENT TO FLUCTUATE, AND WHEN THE INVESTMENT IS REDEEMED, THE VALUE MAY BE
HIGHER OR LOWER THAN THE AMOUNT ORIGINALLY INVESTED BY THE INVESTOR.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

THE DATE OF THIS PROSPECTUS IS OCTOBER 1, 1995
<PAGE>

TABLE OF CONTENTS

<TABLE>

<CAPTION>
PAGE
<S> <C>
Investors for Whom the Fund Is Designed.................................... 1
Financial Highlights....................................................... 3
Special Information Concerning Hub and Spoke(R)............................ 3
Investment Objective and Policies.......................................... 4
Risk Factors and Additional Investment Information......................... 6
Investment Restrictions.................................................... 9
Management of the Trust and the Portfolio.................................. 10
Shareholder Transactions................................................... 13
Purchase of Shares......................................................... 13
</TABLE>

<TABLE>

<CAPTION>
PAGE
<S> <C>
Redemption of Shares....................................................... 14
Exchange of Shares......................................................... 14
Dividends and Distributions................................................ 14
Net Asset Value............................................................ 15
Organization............................................................... 15
Taxes...................................................................... 16
Additional Information..................................................... 16
Appendix................................................................... A-1
Options.................................................................... A-1
Futures Contracts.......................................................... A-1
</TABLE>

<PAGE>

The JPM Advisor U.S. Small Cap Equity Fund

INVESTORS FOR WHOM THE FUND IS DESIGNED

The Fund is designed for investors who wish to invest in a portfolio of equity
securities of small companies. The Fund seeks to achieve its investment objec-
tive by investing all of its investable assets in The U.S. Small Company Port-
folio, a diversified open-end management investment company having the same in-
vestment objective as the Fund. Since the investment characteristics and expe-
rience of the Fund will correspond directly with those of the Portfolio, the
discussion in this Prospectus focuses on the investments and investment poli-
cies of the Portfolio. The net asset value of shares in the Fund fluctuates
with changes in the value of the investments in the Portfolio.

The Portfolio may make various types of investments in seeking its objective.
Among the permissible investments and investment techniques for the Portfolio
are futures contracts, options and forward contracts on foreign currencies. The
potential risks of investing in these derivative instruments are discussed in
Risk Factors and Additional Investment Information and the Appendix. The Port-
folio may also purchase certain privately placed securities. In view of the
capitalization of the companies in which the Portfolio invests, the risks of
investment in the Fund and the volatility of the value of its shares may be
greater than the general equity markets. For further information about these
investments, see Investment Objective and Policies below.

The Fund requires a minimum initial investment of $5,000. See Purchase of
Shares.

This Prospectus describes the investment objective and policies, management and
operation of the Fund to enable investors to decide if the Fund suits their
needs. The Fund operates through Signature Financial Group, Inc.'s ("Signa-
ture") Hub and Spoke (R) financial services method. The Trustees of the Trust
believe that the Fund may achieve economies of scale over time by investing
through Hub and Spoke (R).

The following table illustrates that investors in the Fund incur no shareholder
transaction expenses; their investment in the Fund is subject only to the oper-
ating expenses set forth below for the Fund and the Portfolio, as a percentage
of average net assets of the Fund. The Trustees of the Trust believe that the
aggregate per share expenses of the Fund and the Portfolio will be approxi-
mately equal to and may be less than the expenses that the Fund would incur if
it retained the services of an investment adviser and invested its assets di-
rectly in portfolio securities. Fund and Portfolio expenses are discussed below
under the headings Management of the Trust and the Portfolio.

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Sales Load Imposed on Purchases............................................ None
Sales Load Imposed on Reinvested Dividends................................. None
Deferred Sales Load........................................................ None
Redemption Fees............................................................ None
Exchange Fees.............................................................. None
</TABLE>

1
<PAGE>

EXPENSE TABLE

ANNUAL OPERATING EXPENSES*

<TABLE>
<S> <C>
Advisory Fees............................................................. 0.60%
Rule 12b-1 Fees........................................................... None
Other Expenses (after expense reimbursement).............................. 0.70%
----
Total Operating Expenses (after expense reimbursement).................... 1.30%
</TABLE>
- -------

* These expenses are based on estimated expenses of the Fund and the Portfolio
and estimated average net assets for the Fund's current fiscal year, after
any applicable expense reimbursement. Without such expected reimbursement,
the estimated Total Operating Expenses would be equal on an annual basis to
1.41% of the estimated average daily net assets of the Fund. See Management
of the Trust and the Portfolio.

EXAMPLE

An investor would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

<TABLE>
<S> <C>
1 Year..................................................................... $ 13
3 Years.................................................................... $ 42
5 Years.................................................................... $ 73
10 Years................................................................... $160
</TABLE>

The above expense table is designed to assist investors in understanding the
various direct and indirect costs and expenses that investors in the Fund bear.
The fees and expenses included in Other Expenses are the fees paid to Morgan
under the Services Agreement, organizational expenses, fees paid to State
Street Bank and Trust Company as custodian of the Portfolio and other usual and
customary expenses of the Portfolio. For a more detailed description of con-
tractual fee arrangements, including expense reimbursements, and of the fees
and expenses included in Other Expenses, see Management of the Trust and the
Portfolio. In connection with the above example, please note that $1,000 is
less than the Fund's minimum investment requirement and that there are no re-
demption or exchange fees of any kind. See Purchase of Shares and Redemption of
Shares. THE EXAMPLE IS HYPOTHETICAL; IT IS INCLUDED SOLELY FOR ILLUSTRATIVE
PURPOSES. IT SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE PERFORMANCE;
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.

2
<PAGE>

FINANCIAL HIGHLIGHTS

The following selected data for a share outstanding for the indicated periods
have been audited by independent accountants. A copy of the Fund's annual re-
port, which is incorporated by reference into the Statement of Additional In-
formation, will be made available without charge upon request.

<TABLE>

<CAPTION>
FOR THE PERIOD
MARCH 24, 1995
(COMMENCEMENT OF
OPERATIONS) TO
MAY 31, 1995
----------------
<S> <C>
Net Asset Value, Beginning of Period.......................... $10.00
Income From Investment Operations:
Net Investment Income....................................... 0.10
Net Realized and Unrealized Gain from Portfolio............. 0.54
------
Total From Investment Operations.............................. 0.64
------
Net Asset Value, End of Period................................ $10.64
======
Total Return.................................................. 6.40%(a)
Ratios and Supplemental Data:
Net Assets at End of Period................................. $ 106
Ratios to Average Net Assets:
Expenses.................................................. 0.00%(b)
Net Investment Income..................................... 5.04%(b)
Decrease Reflected in the Above Expense Ratio due to
Expense Reimbursements................................... 2.50%(b)
</TABLE>

- -------

(a)Not annualized.

(b)Annualized.

SPECIAL INFORMATION CONCERNING HUB AND SPOKE(R)

The Trust and the Portfolio use certain proprietary rights, know-how and finan-
cial services referred to as Hub and Spoke (R). Hub and Spoke (R) is a regis-
tered service mark of Signature. Signature Broker-Dealer Services, Inc. (the
Trust's and Portfolio's Administrator and the Trust's Distributor) is a wholly
owned subsidiary of Signature.

Unlike other mutual funds which directly acquire and manage their own portfolio
of securities, the Fund is an open-end management investment company which
seeks to achieve its investment objective by investing all of its investable
assets in the Portfolio, a separate registered investment company with the same
investment objective as the Fund. The investment objective of the Fund or Port-
folio may be changed only with the approval of the holders of the outstanding
shares of the Fund and the Portfolio. The use of Hub and Spoke(R) has been ap-
proved by the shareholders of the Fund. The Hub and Spoke(R) investment fund
structure has been developed relatively recently, so shareholders should care-
fully consider this investment approach.

In addition to selling a beneficial interest to the Fund, the Portfolio may
sell beneficial interests to other mutual funds or institutional investors.
Such investors will invest in the Portfolio on the same terms and conditions
and will pay a proportionate share of the Portfolio's expenses. However, the
other investors investing in the Portfolio may sell shares of their own fund
using a different pricing structure than the Fund. Such different pricing
structures may result in differences in returns experienced by investors in
other funds that invest in the Portfolio. Such differences in returns are not
uncommon and are present in other mutual fund structures. Information concern-
ing other holders of interests in the Portfolio is available from the Adminis-
trator at (800) 847-9487.

3
<PAGE>

The Trust may withdraw the investment of the Fund from the Portfolio at any
time if the Board of Trustees of the Trust determines that it is in the best
interests of the Fund to do so. Upon any such withdrawal, the Board of Trustees
would consider what action might be taken, including the investment of all the
assets of the Fund in another pooled investment entity having the same invest-
ment objective and restrictions as the Fund or the retaining of an investment
adviser to manage the Fund's assets in accordance with the investment policies
described below with respect to the Portfolio.

Certain changes in the Portfolio's investment objective, policies or restric-
tions, or a failure by the Fund's shareholders to approve a change in the Port-
folio's investment objective or restrictions, may require withdrawal of the
Fund's interest in the Portfolio. Any such withdrawal could result in a distri-
bution in kind of portfolio securities (as opposed to a cash distribution) from
the Portfolio which may or may not be readily marketable. The distribution in
kind may result in the Fund having a less diversified portfolio of investments
or adversely affect the Fund's liquidity, and the Fund could incur brokerage,
tax or other charges in converting the securities to cash. Notwithstanding the
above, there are other means for meeting shareholder redemption requests, such
as borrowing.

Smaller funds investing in the Portfolio may be materially affected by the ac-
tions of larger funds investing in the Portfolio. For example, if a large fund
withdraws from the Portfolio, the remaining funds may subsequently experience
higher pro rata operating expenses, thereby producing lower returns. Addition-
ally, because the Portfolio would become smaller, it may become less diversi-
fied, resulting in potentially increased portfolio risk (however, these possi-
bilities also exist for traditionally structured funds which have large or in-
stitutional investors who may withdraw from a fund). Also, funds with a greater
pro rata ownership in the Portfolio could have effective voting control of the
operations of the Portfolio. Whenever the Fund is requested to vote on matters
pertaining to the Portfolio (other than a vote by the Fund to continue the op-
eration of the Portfolio upon the withdrawal of another investor in the Portfo-
lio), the Trust will hold a meeting of shareholders of the Fund and will cast
all of its votes proportionately as instructed by the Fund's shareholders. The
Trust will vote the shares held by Fund shareholders who do not give voting in-
structions in the same proportion as the shares of Fund shareholders who do
give voting instructions. Shareholders of the Fund who do not vote will have no
effect on the outcome of such matters.

For more information about the Portfolio's investment objective, policies and
restrictions, see Investment Objective and Policies, Risk Factors and Addi-
tional Investment Information and Investment Restrictions. For more information
about the Portfolio's management and expenses, see Management of the Trust and
the Portfolio. For more information about changing the investment objective,
policies and restrictions of the Fund or the Portfolio, see Investment Restric-
tions.

INVESTMENT OBJECTIVE AND POLICIES

The investment objective of the Fund and the Portfolio is described below, to-
gether with the policies they employ in their efforts to achieve this objec-
tive. Additional information about the investment policies of the Fund and the
Portfolio appears in the Statement of Additional Information under Investment
Objectives and Policies. There can be no assurance that the investment objec-
tive of the Fund or the Portfolio will be achieved.

The Fund's investment objective is to provide a high total return from a port-
folio of equity securities of small companies. Total return will consist of re-
alized and unrealized capital gains and losses plus income. The Fund attempts
to achieve its investment objective by investing all of its investable assets
in The U.S. Small Company Portfolio, a diversified open-end management invest-
ment company having the same investment objective as the Fund. The Portfolio
invests primarily in the common stock of small U.S. companies. The small com-
pany holdings of the Portfolio are primarily companies included in the Russell
2500 Index. Under certain market conditions, the Fund or the Portfolio may not
be able to achieve its investment objective.

4
<PAGE>

The Fund is designed for investors who are willing to assume the somewhat
higher risk of investing in small companies in order to seek a higher return
over time than might be expected from a portfolio of stocks of large compa-
nies. The Fund may also serve as an efficient vehicle to diversify an existing
portfolio by adding the equities of smaller U.S. companies.

Morgan seeks to enhance the Portfolio's total return relative to that of the
U.S. small company universe. To do so, Morgan uses fundamental research, sys-
tematic stock valuation and a disciplined portfolio construction process. Mor-
gan continually screens the universe of small capitalization companies to
identify for further analysis those companies which exhibit favorable charac-
teristics such as significant and predictable cash flow and high quality man-
agement. Based on fundamental research and using a dividend discount model,
Morgan ranks these companies within economic sectors according to their rela-
tive value. Morgan then selects for purchase the most attractive companies
within each economic sector.

Morgan uses a disciplined portfolio construction process to seek to enhance
returns and reduce volatility in the market value of the Portfolio relative to
that of the U.S. small company universe. Morgan believes that under normal
market conditions, the Portfolio will have sector weightings comparable to
that of the U.S. small company universe, although it may moderately under- or
over-weight selected economic sectors. In addition, as a company moves out of
the market capitalization range of the small company universe, it generally
becomes a candidate for sale by the Portfolio.

The Portfolio intends to manage its investments actively in pursuit of its in-
vestment objective. Since the Portfolio has a long-term investment perspec-
tive, it does not intend to respond to short-term market fluctuations or to
acquire securities for the purpose of short-term trading; however, it may take
advantage of short-term trading opportunities that are consistent with its ob-
jective. To the extent the Portfolio engages in short-term trading, it may re-
alize short-term capital gains or losses and incur increased transaction
costs. See Taxes below. The estimated annual portfolio turnover rate for the
Portfolio is generally not expected to exceed 100%.

EQUITY INVESTMENTS. During ordinary market conditions, the Advisor intends to
keep the Portfolio essentially fully invested with at least 65% of the Portfo-
lio's net assets invested in equity securities consisting of common stocks and
other securities with equity characteristics comprised of preferred stock,
warrants, rights, convertible securities, trust certificates, limited partner-
ship interests and equity participations. The Portfolio's primary equity in-
vestments are the common stock of small U.S. companies and, to a limited ex-
tent, similar securities of foreign corporations. The common stock in which
the Portfolio may invest includes the common stock of any class or series or
any similar equity interest, such as trust or limited partnership interests.
The small company holdings of the Portfolio are primarily companies included
in the Russell 2500 Index. These equity investments may or may not pay divi-
dends and may or may not carry voting rights. The Portfolio invests in securi-
ties listed on domestic or foreign securities exchanges and securities traded
in domestic or foreign over-the-counter markets, and may invest in certain re-
stricted or unlisted securities.

FOREIGN INVESTMENTS. The Portfolio may invest up to 5% of its assets at the
time of purchase in securities of foreign issuers that are listed on a na-
tional securities exchange or denominated or principally traded in U.S. dol-
lars. For further information on foreign investments and foreign currency ex-
change transactions, see Risk Factors and Additional Investment Information.

The Portfolio may also invest in securities on a when-issued or delayed deliv-
ery basis, enter into repurchase and reverse repurchase agreements, loan its
portfolio securities, purchase certain privately placed securities and money
market instruments, and enter into certain hedging transactions that may in-
volve options on securities and securities indexes, futures contracts and op-
tions on futures contracts. Forward foreign currency exchange contracts, op-
tions and futures contracts are derivative instruments. For a discussion of
these investments and investment techniques, see Risk Factors and Additional
Investment Information.

5
<PAGE>

RISK FACTORS AND ADDITIONAL INVESTMENT INFORMATION

CONVERTIBLE SECURITIES. The convertible securities in which the Portfolio may
invest include any debt securities or preferred stock which may be converted
into common stock or which carry the right to purchase common stock. Convert-
ible securities entitle the holder to exchange the securities for a specified
number of shares of common stock, usually of the same company, at specified
prices within a certain period of time.

WARRANTS. The Portfolio invests in warrants, which entitle the holder to buy
common stock from the issuer at a specific price (the strike price) for a spe-
cific period of time. The strike price of warrants sometimes is much lower
than the current market price of the underlying securities, yet warrants are
subject to similar price fluctuations. As a result, warrants may be more vola-
tile investments than the underlying securities.

Warrants do not entitle the holder to dividends or voting rights with respect
to the underlying securities and do not represent any rights in the assets of
the issuing company. Also, the value of the warrant does not necessarily
change with the value of the underlying securities and a warrant ceases to
have value if it is not exercised prior to the expiration date.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. The Portfolio may purchase money
market instruments on a when-issued or delayed delivery basis. Delivery of and
payment for these securities may take as long as a month or more after the
date of the purchase commitment. The value of these securities is subject to
market fluctuation during this period and for fixed income investments no in-
terest accrues to the Portfolio until settlement. At the time of settlement, a
when-issued security may be valued at less than its purchase price. The Port-
folio maintains with the Custodian a separate account with a segregated port-
folio of securities in an amount at least equal to these commitments. When en-
tering into a when-issued or delayed delivery transaction, the Portfolio will
rely on the other party to consummate the transaction; if the other party
fails to do so, the Portfolio may be disadvantaged. It is the current policy
of the Portfolio not to enter into when-issued commitments exceeding in the
aggregate 15% of the market value of the Portfolio's total assets less liabil-
ities other than the obligations created by these commitments.

REPURCHASE AGREEMENTS. The Portfolio may engage in repurchase agreement trans-
actions with brokers, dealers or banks that meet the credit guidelines estab-
lished by the Portfolio's Trustees. In a repurchase agreement, the Portfolio
buys a security from a seller that has agreed to repurchase it at a mutually
agreed upon date and price, reflecting the interest rate effective for the
term of the agreement. The term of these agreements is usually from overnight
to one week. A repurchase agreement may be viewed as a fully collateralized
loan of money by the Portfolio to the seller. The Portfolio always receives
securities as collateral with a market value at least equal to the purchase
price plus accrued interest and this value is maintained during the term of
the agreement. If the seller defaults and the collateral value declines, the
Portfolio might incur a loss. If bankruptcy proceedings are commenced with re-
spect to the seller, the Portfolio's realization upon the disposition of col-
lateral may be delayed or limited. Investments in certain repurchase agree-
ments and certain other investments which may be considered illiquid are lim-
ited. See Illiquid Investments; Privately Placed and other Unregistered Secu-
rities below. Other repurchase agreements are considered to be a type of money
market instrument. See Risk Factors and Additional Investment Information--
Money Market Instruments.

LOANS OF PORTFOLIO SECURITIES. Subject to applicable investment restrictions,
the Portfolio is permitted to lend its securities in an amount up to 33 1/3%
of the value of the Portfolio's net assets. The Portfolio may lend its securi-
ties if such loans are secured continuously by cash or equivalent collateral
or by a letter of credit in favor of the Portfolio at least equal at all times
to 100% of the market value of the securities loaned, plus accrued interest.
While such securities are on loan, the borrower will pay the Portfolio any in-
come accruing thereon. Loans will be subject to termination by the Portfolio
in the normal settlement time, generally three business days after notice, or
by the borrower on one day's notice. Borrowed securities must be returned when
the loan is terminated. Any gain or loss in the market price of the borrowed
securities which occurs during the term of the loan inures to the Portfolio
and its respective investors. The Portfolio may pay reasonable finders' and
custodial fees in connection with a loan. In addition, the Portfolio will con-
sider all facts and

6
<PAGE>

circumstances, including the creditworthiness of the borrowing financial in-
stitution, and the Portfolio will not make any loans in excess of one year.
The Portfolio will not lend its securities to any officer, Trustee, Director,
employee or other affiliate of the Portfolio, the Advisor or the Distributor,
unless otherwise permitted by applicable law.

REVERSE REPURCHASE AGREEMENTS. The Portfolio is permitted to enter into re-
verse repurchase agreements. In a reverse repurchase agreement, the Portfolio
sells a security and agrees to repurchase it at a mutually agreed upon date
and price, reflecting the interest rate effective for the term of the agree-
ment. For purposes of the Investment Company Act of 1940 (the "1940 Act"), it
is considered a form of borrowing by the Portfolio and, therefore, is a form
of leverage. Leverage may cause any gains or losses of the Portfolio to be
magnified. For more information, see Investment Objectives and Policies in the
Statement of Additional Information.

ILLIQUID INVESTMENTS; PRIVATELY PLACED AND OTHER UNREGISTERED SECURITIES. The
Portfolio may not acquire any illiquid securities if, as a result thereof,
more than 15% of the market value of the Portfolio's total assets would be in
illiquid investments. Subject to this non-fundamental policy limitation, the
Portfolio may acquire investments that are illiquid or have limited liquidity,
such as private placements or investments that are not registered under the
Securities Act of 1933 (the "1933 Act"). An illiquid investment is any invest-
ment that cannot be disposed of within seven days in the normal course of
business at approximately the amount at which it is valued by the Portfolio.
The price the Portfolio pays for illiquid securities or receives upon resale
may be lower than the price paid or received for similar securities with a
more liquid market. Accordingly the valuation of these securities will reflect
any limitations on their liquidity.

The Portfolio may also purchase Rule 144A securities sold to institutional in-
vestors without registration under the 1933 Act. These securities may be de-
termined to be liquid in accordance with guidelines established by the Advisor
and approved by the Trustees of the Portfolio. The Trustees will monitor the
Advisor's implementation of these guidelines on a periodic basis.

FUTURES AND OPTIONS TRANSACTIONS. The Portfolio may (a) purchase exchange
traded and over-the-counter put and call options on equity securities or in-
dexes of equity securities, (b) purchase and sell futures contracts on indexes
of equity securities, and (c) purchase put and call options on futures con-
tracts on indexes of equity securities. Each of these instruments is a deriva-
tive instrument, as its value derives from the underlying asset or index.

The Portfolio may use futures contracts and options for hedging purposes. The
Portfolio may not use futures contracts and options for speculation.

The Portfolio may utilize options and futures contracts to manage its exposure
to changing interest rates and/or security prices. Some options and futures
strategies, including selling futures contracts and buying puts, tend to hedge
the Portfolio's investments against price fluctuations. Other strategies, in-
cluding buying futures contracts and buying calls, tend to increase market ex-
posure. Options and futures contracts may be combined with each other or with
forward contracts in order to adjust the risk and return characteristics of
the Portfolio's overall strategy in a manner deemed appropriate to the Advisor
and consistent with the Portfolio's objective and policies. Because combined
options positions involve multiple trades, they result in higher transaction
costs and may be more difficult to open and close out.

The use of options and futures is a highly specialized activity which involves
investment strategies and risks different from those associated with ordinary
portfolio securities transactions, and there can be no guarantee that their
use will increase the Portfolio's return. While the use of these instruments
by the Portfolio may reduce certain risks associated with own-ing its portfo-
lio securities, these techniques themselves entail certain other risks. If the
Advisor applies a strategy at an inappropriate time or judges market condi-
tions or trends incorrectly, options and futures strategies may lower the
Portfolio's return. Certain strategies limit the Portfolio's possibilities to
realize gains as well as limiting its exposure to losses. The Portfolio could
also experience losses if the prices of its options and futures positions were
poorly correlated with its other investment, or if it could not close out its
positions because of an illiquid secondary market. In addition, the Portfolio
will incur transaction costs, including trading commissions and option premi-
ums, in connection with its futures and options transactions and these trans-
actions could significantly increase the Portfolio's turnover rate.

7
<PAGE>

The Portfolio may purchase put and call options on securities, indexes of se-
curities and futures contracts, or purchase and sell futures contracts, only
if such options are written by other persons and if (i) the aggregate premiums
paid on all such options which are held at any time do not exceed 20% of the
Portfolio's net assets, and (ii) the aggregate margin deposits required on all
such futures or options thereon held at any time do not exceed 5% of the Port-
folio's total assets. For more detailed information about these transactions,
see the Appendix to this Prospectus and Investment Objectives and Policies in
the Statement of Additional Information.

FOREIGN INVESTMENT INFORMATION. The Portfolio may invest in certain foreign
securities. Investment in securities of foreign issuers involves somewhat dif-
ferent investment risks from those affecting securities of U.S. domestic is-
suers. There may be limited publicly available information with respect to
foreign issuers, and foreign issuers are not generally subject to uniform ac-
counting, auditing and financial standards and requirements comparable to
those applicable to domestic companies. Dividends and interest paid by foreign
issuers may be subject to withholding and other foreign taxes which may de-
crease the net return on foreign investments as compared to dividends and in-
terest paid to the Portfolio by domestic companies.

Investors should realize that the value of the Portfolio's investments in for-
eign securities may be adversely affected by changes in political or social
conditions, diplomatic relations, confiscatory taxation, expropriation, na-
tionalization, limitation on the removal of funds or assets, or imposition of
(or change in) exchange control or tax regulations in those foreign countries.
In addition, changes in government administrations or economic or monetary
policies in the United States or abroad could result in appreciation or depre-
ciation of portfolio securities and could favorably or unfavorably affect the
Portfolio's operations. Furthermore, the economies of individual foreign na-
tions may differ from the U.S. economy, whether favorably or unfavorably, in
areas such as growth of gross national product, rate of inflation, capital re-
investment, resource self-sufficiency and balance of payments position; it may
also be more difficult to obtain and enforce a judgment against a foreign is-
suer. Any foreign investments made by the Portfolio must be made in compliance
with U.S. and foreign currency restrictions and tax laws restricting the
amounts and types of foreign investments.

In addition, while the volume of transactions effected on foreign stock ex-
changes has increased in recent years, in most cases it remains appreciably
below that of domestic security exchanges. Accordingly, the Portfolio's for-
eign investments may be less liquid and their prices may be more volatile than
comparable investments in securities of U.S. companies. Moreover, the settle-
ment periods for foreign securities, which are often longer than those for se-
curities of U.S. issuers, may affect portfolio liquidity. In buying and sell-
ing securities on foreign exchanges, purchasers normally pay fixed commissions
that are generally higher than the negotiated commissions charged in the
United States. In addition, there is generally less government supervision and
regulation of securities exchanges, brokers and issuers located in foreign
countries than in the United States.

The Portfolio may invest in securities of foreign issuers directly or in the
form of American Depositary Receipts ("ADRs"), European Depositary Receipts
("EDRs") or other similar securities of foreign issuers. These securities may
not necessarily be denominated in the same currency as the securities they
represent. ADRs are receipts typically issued by a U.S. bank or trust company
evidencing ownership of the underlying foreign securities. Certain such insti-
tutions issuing ADRs may not be sponsored by the issuer of the underlying for-
eign securities. A non-sponsored depository may not provide the same share-
holder information that a sponsored depository is required to provide under
its contractual arrangements with the issuer of the underlying foreign securi-
ties. EDRs are receipts issued by a European financial institution evidencing
a similar arrangement. Generally, ADRs, in registered form, are designed for
use in the U.S. securities markets, and EDRs, in bearer form, are designed for
use in European securities markets.

Since the Portfolio's investments in foreign securities involve foreign cur-
rencies, the value of its assets as measured in U.S. dollars may be affected
favorably or unfavorably by changes in currency rates and in exchange control
regulations, including currency blockage. See Foreign Currency Exchange Trans-
actions.

8
<PAGE>

FOREIGN CURRENCY EXCHANGE TRANSACTIONS. Because the Portfolio may buy and sell
securities and receive interest and dividends in currencies other than the
U.S. dollar, the Portfolio may enter from time to time into foreign currency
exchange transactions. The Portfolio either enters into these transactions on
a spot (i.e., cash) basis at the spot rate prevailing in the foreign currency
exchange market or uses forward contracts to purchase or sell foreign curren-
cies. The cost of the Portfolio's spot currency exchange transactions is gen-
erally the difference between the bid and offer spot rate of the currency be-
ing purchased or sold.

A forward foreign currency exchange contract is an obligation by the Portfolio
to purchase or sell a specific currency at a future date, which may be any
fixed number of days from the date of the contract. Forward foreign currency
exchange contracts establish an exchange rate at a future date. These con-
tracts are derivative instruments, as their value derives from the spot ex-
change rates of the currencies underlying the contract. These contracts are
entered into in the interbank market directly between currency traders (usu-
ally large commercial banks) and their customers. A forward foreign currency
exchange contract generally has no deposit requirement and is traded at a net
price without commission. The Portfolio will not enter into forward contracts
for speculative purposes. Neither spot transactions nor forward foreign cur-
rency exchange contracts eliminate fluctuations in the prices of the Portfo-
lio's securities or in foreign exchange rates, or prevent loss if the prices
of these securities should decline.

The Portfolio may enter into foreign currency exchange transactions in an at-
tempt to protect against changes in foreign currency exchange rates between
the trade and settlement dates of specific securities transactions or antici-
pated securities transactions. The Portfolio may also enter into forward con-
tracts to hedge against a change in foreign currency exchange rates that would
cause a decline in the value of existing investments denominated or princi-
pally traded in a foreign currency. To do this, the Portfolio would enter into
a forward contract to sell the foreign currency in which the investment is de-
nominated or principally traded in exchange for U.S. dollars or in exchange
for another foreign currency. The Portfolio will only enter into forward con-
tracts to sell a foreign currency in exchange for another foreign currency if
the Advisor expects the foreign currency purchased to appreciate against the
U.S. dollar.

Although these transactions are intended to minimize the risk of loss due to a
decline in the value of the hedged currency, at the same time they limit any
potential gain that might be realized should the value of the hedged currency
increase. In addition, forward contracts that convert a foreign currency into
another foreign currency will cause the Portfolio to assume the risk of fluc-
tuations in the value of the currency purchased against the hedged currency
and the U.S. dollar. The precise matching of the forward contract amounts and
the value of the securities involved will not generally be possible because
the future value of such securities in foreign currencies will change as a
consequence of market movements in the value of such securities between the
date the forward contract is entered into and the date it matures. The projec-
tion of currency market movements is extremely difficult, and the successful
execution of a hedging strategy is highly uncertain.

MONEY MARKET INSTRUMENTS. The Portfolio is permitted to invest in money market
instruments although it intends to stay invested in equity securities to the
extent practical in light of its objective and long-term investment perspec-
tive. The Portfolio may invest in money market instruments of domestic or for-
eign issuers denominated in U.S. dollars. Under normal circumstances the Port-
folio will purchase these securities to invest temporary cash balances or to
maintain liquidity to meet redemptions. However, the Portfolio may also invest
in money market instruments without limitation as a temporary defensive meas-
ure taken in the Advisor's judgment during, or in anticipation of, adverse
market conditions. For more detailed information about these money market in-
vestments, see Investment Objectives and Policies in the Statement of Addi-
tional Information.

INVESTMENT RESTRICTIONS

As a diversified investment company, 75% of the assets of the Portfolio are
subject to the following fundamental limitations: (a) the Portfolio may not
invest more than 5% of its total assets in the securities of any one issuer,
except U.S. government securities, and (b) the Portfolio may not own more than
10% of the outstanding voting securities of any one issuer.

9
<PAGE>

The investment objective of the Fund and the Portfolio, together with the in-
vestment restrictions described below and in the Statement of Additional In-
formation, except as noted, are deemed fundamental policies, i.e., they may be
changed only with the approval of the holders of a majority of the outstanding
voting securities of the Fund and the Portfolio. The Fund has the same invest-
ment restrictions as the Portfolio, except that the Fund may invest all of its
investable assets in another open-end investment company with the same invest-
ment objective and restrictions (such as the Portfolio). References below to
the Portfolio's investment restrictions also include the Fund's investment re-
strictions.

The Portfolio may not (i) borrow money, except from banks for extraordinary or
emergency purposes and then only in amounts up to 10% of the value of the
Portfolio's total assets, taken at cost at the time of borrowing, or purchase
securities while borrowings exceed 5% of its total assets; or mortgage, pledge
or hypothecate any assets except in connection with any such borrowings in
amounts up to 10% of the value of the Portfolio's net assets at the time of
borrowing; (ii) purchase securities or other obligations of issuers conducting
their principal business activity in the same industry if its investments in
such industry would exceed 25% of the value of the Portfolio's total assets,
except this limitation shall not apply to investments in U.S. Government secu-
rities; or (iii) purchase securities of any issuer if, as a result of the pur-
chase, more than 5% of the total assets of the Portfolio would be invested in
securities of companies with fewer than three years of operating history (in-
cluding predecessors).

For a more detailed discussion of the above investment restrictions, as well
as a description of certain other investment restrictions, see Investment Re-
strictions in the Statement of Additional Information.

MANAGEMENT OF THE TRUST AND THE PORTFOLIO

TRUSTEES. Pursuant to the Declarations of Trust for the Trust, the Trustees of
the Trust decide upon matters of general policy and review the actions of the
Trust's Administrator, Distributor, Services Agent, and other service provid-
ers and the performance of the Portfolio's Advisor. Pursuant to the Declara-
tion of Trust for the Portfolio, the Trustees of the Portfolio (who are not
the same as the Trustees of the Trust) have the same responsibilities for the
Portfolio including overseeing its service providers.

The Portfolio has entered into a Fund Services Agreement with Pierpont Group,
Inc. to assist the Trustees of the Portfolio in exercising their overall su-
pervisory responsibilities for the Portfolio's affairs. The fee to be paid by
the Portfolio under the agreement approximates the reasonable cost of Pierpont
Group, Inc. in providing these services. Pierpont Group, Inc. was organized in
1989 at the request of the Trustees of The Pierpont Family of Funds for the
purpose of providing these services at cost to those funds. The principal of-
fices of Pierpont Group, Inc. are located at 461 Fifth Avenue, New York, New
York 10017. For more information concerning the Trust's and the Portfolio's
Trustees and officers, see Trustees and Officers in the Statement of Addi-
tional Information.

ADVISOR. The Fund has not retained the services of an investment adviser be-
cause the Fund seeks to achieve its investment objective by investing all of
its investable assets in the Portfolio. The Portfolio has retained the serv-
ices of Morgan as Investment Advisor. Morgan, with principal offices at 60
Wall Street, New York, New York 10260, is a New York trust company which con-
ducts a general banking and trust business. Morgan is a wholly-owned subsidi-
ary of J.P. Morgan & Co. Incorporated ("J.P. Morgan"), a bank holding company
organized under the laws of Delaware. Through offices in New York City and
abroad, J.P. Morgan, through the Advisor and other subsidiaries, offers a wide
range of services to governmental, institutional, corporate and individual
customers and acts as investment adviser to individual and institutional cli-
ents with combined assets under management of over $165 billion (of which the
Advisor advises over $26 billion). Morgan provides investment advice and port-
folio management services to the Portfolio. Subject to the supervision of the
Portfolio's Trustees, Morgan makes the Portfolio's day-to-day investment deci-
sions, arranges for the execution of portfolio transactions and generally man-
ages the Portfolio's investments. See Investment Advisor in the Statement of
Additional Information.

10
<PAGE>

Morgan uses a sophisticated, disciplined, collaborative process for managing
all asset classes. For equity portfolios, this process utilizes fundamental re-
search, systematic stock selection and disciplined portfolio construction. Mor-
gan has invested in equity securities of small U.S. companies on behalf of its
clients since the 1960s. The portfolio managers making investments in small
U.S. companies work in conjunction with Morgan's domestic equity analysts, as
well as capital market, credit and economic research analysts, traders and ad-
ministrative officers. The U.S. equity analysts each cover a different indus-
try, following both the small and large companies in their respective indus-
tries. They currently monitor a universe of over 300 small companies.

The following persons are primarily responsible for the day-to-day management
and implementation of Morgan's process for the Portfolio (the inception date of
each person's responsibility for the Portfolio and his business experience for
the past five years is indicated parenthetically): James B. Otness, Managing
Director (since February, 1993, employed by Morgan since prior to 1990 as a
portfolio manager of equity securities of small and medium sized U.S. compa-
nies) and Fred W. Kittler, Vice President (since February, 1993, employed by
Morgan since prior to 1990 as a portfolio manager of small and medium sized
U.S. companies).

As compensation for the services rendered and related expenses borne by Morgan
under the Investment Advisory Agreement with the Portfolio, the Portfolio has
agreed to pay Morgan a fee, which is computed daily and may be paid monthly, at
the annual rate of 0.60% of the Portfolio's average daily net assets.

Morgan also acts as Services Agent to the Trust and provides shareholder serv-
ices to shareholders of the Fund. See Services Agent below. INVESTMENTS IN THE
FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, MORGAN
GUARANTY TRUST COMPANY OF NEW YORK OR ANY OTHER BANK.

ADMINISTRATOR AND DISTRIBUTOR. Under Administration Agreements with the Trust
and the Portfolio, Signature Broker-Dealer Services, Inc. ("SBDS") serves as
the Administrator for the Trust and the Portfolio and in that capacity super-
vises the Fund's and the Portfolio's day-to-day operations other than manage-
ment of the Portfolio's investments. In this capacity, SBDS administers and
manages all aspects of the Fund's and the Portfolio's day-to-day operations
subject to the supervision of the Trustees, except as set forth under Advisor,
Services Agent and Custodian. In connection with its responsibilities as Admin-
istrator, SBDS (i) furnishes ordinary clerical and related services for day-to-
day operations including certain recordkeeping responsibilities; (ii) takes re-
sponsibility for compliance with all applicable federal and state securities
and other regulatory requirements; (iii) is responsible for the registration of
sufficient Fund shares under federal and state securities laws; (iv) takes re-
sponsibility for monitoring the Fund's status as a regulated investment company
under the Internal Revenue Code of 1986, as amended (the "Code"); and (v) per-
forms such administrative and managerial oversight of the activities of the
Trust's and the Portfolio's custodian and transfer agent as the respective
Trustees may direct from time to time. Under the terms of the Trust's Services
Agreement with Morgan, the fees of the Administrator for its services to the
Trust are covered by Morgan's expense undertakings described under Services
Agent below.

Under the Trust's Administration Agreement, the annual administration fee rate
is calculated based on the aggregate average daily net assets of The JPM Advi-
sor Funds, as well as The JPM Institutional Funds and The Pierpont Funds, which
are two other family of mutual funds for which SBDS acts as Administrator. The
fee rate is calculated daily in accordance with the following schedule: 0.040%
of the first $1 billion of these funds' aggregate average daily net assets,
0.032% of the next $2 billion of these funds' aggregate average daily net as-
sets, 0.024% of the next $2 billion of these funds' aggregate average daily net
assets and 0.016% of these funds' aggregate average daily net assets in excess
of $5 billion. This fee rate is then applied to the net assets of the Fund.

11
<PAGE>

next $2 billion of these portfolios' aggregate average daily net assets, 0.006%
of the next $2 billion of these portfolios' aggregate average daily net assets
and 0.004% of these portfolios' aggregate average daily net assets in excess of
$5 billion. This fee rate is then applied to the net assets of the Portfolio.
The Administrator may voluntarily waive a portion of its fees.

SBDS, a registered broker-dealer, also serves as the Distributor of shares of
the Fund and the Exclusive Placement Agent for the Portfolio. Signature and its
affiliates currently provide administration and distribution services for a
number of registered investment companies through offices located in Boston,
New York, London, Toronto and George Town, Grand Cayman.

SERVICES AGENT. Under a Services Agreement with the Trust, Morgan acts as Serv-
ices Agent to the Trust and provides shareholder services to shareholders of
the Fund. The agreement provides that Morgan is responsible for certain ac-
counting and operational services provided to the Fund including services re-
lated to tax returns and financial reports. These services also include matters
related to computing the amount of dividends and the net asset value per share,
keeping the books of account and providing shareholder services to shareholders
of the Fund.

In addition, as provided in the Services Agreement, Morgan is responsible for
the annual costs of certain usual and customary expenses incurred by the Fund
(the "expense undertaking"). The expenses covered by the expense undertaking
include, but are not limited to, transfer, registrar, and dividend disbursing
costs, legal and accounting expenses, fees of the Administrator for services to
the Trust, insurance, the compensation and expenses of the Trust's Trustees,
the expenses of printing and mailing reports, notices, and proxies to Fund
shareholders, and registration fees under federal or state securities laws. The
Fund will pay these expenses directly and such amounts will be deducted from
the fees to be paid to Morgan under the agreement. If such amounts are more
than the amount of Morgan's fees under the agreement, Morgan will reimburse the
Fund for such excess amounts. Under the agreement, the following expenses are
not included in the expense undertaking: the services agent fee, organization
expenses and extraordinary expenses as defined in this agreement.

The Trust's Services Agreement provides for the Fund to pay Morgan a fee for
these services, which is computed daily and may be paid monthly, equal to 0.69%
of the Fund's average daily net assets.

As noted above, the fee levels of the Fund are expense undertakings and reflect
payments made directly to third parties by the Fund for services rendered, as
well as payments to Morgan for services rendered. The Trustees of the Trust
regularly review amounts paid to and accounted for by Morgan pursuant to the
Services Agreement. Under the agreement, Morgan may delegate one or more of its
responsibilities to other entities, including SBDS, at Morgan's expense. See
Expenses below.

CUSTODIAN. State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02101, serves as the Fund's and the Portfolio's Custodian and
Transfer and Dividend Disbursing Agent.

EXPENSES. In addition to the fees payable to Morgan and SBDS under the various
agreements discussed under Trustees, Advisor, and Administrator and Distributor
above, the Portfolio is responsible for usual and customary expenses associated
with its operations. Such expenses include organization expenses, legal fees,
accounting expenses, insurance costs, the compensation and expenses of its
Trustees, registration fees under federal and foreign securities laws, custo-
dian fees, brokerage expenses and extraordinary expenses applicable to the
Portfolio.

12
<PAGE>

longer applies in the event of a precipitous decline in assets due to unfore-
seen circumstances. There is no assurance that Morgan will continue this waiver
beyond the specified period, except as required by the following sentence. Mor-
gan has agreed to waive fees as necessary, if in any fiscal year the sum of the
Fund's expenses exceeds the limits set by applicable regulations of state secu-
rities commissions. Such annual limits are currently 2.5% of the first $30 mil-
lion of average net assets, 2% of the next $70 million of such net assets and
1.5% of such net assets in excess of $100 million for any fiscal year.

SHAREHOLDER TRANSACTIONS

Investors may request either Morgan or their Eligible Institution, as defined
below, for assistance in placing orders to purchase, redeem or exchange shares
of the Fund.

Shareholders should address all inquiries to J.P. Morgan Funds Services, Morgan
Guaranty Trust Company of New York, 522 Fifth Avenue, New York, New York 10036
or call (800) JPM-3637.

The business days of the Fund and the Portfolio are the days the New York Stock
Exchange is open.

PURCHASE OF SHARES

METHOD OF PURCHASE. Investors may open accounts with the Fund only through the
Distributor. All purchase transactions in Fund accounts are processed by Morgan
as Services Agent and the Fund is authorized to accept any instructions relat-
ing to a Fund account from Morgan as agent for the customer. All purchase or-
ders must be accepted by the Fund's Distributor. Investors must be customers of
Morgan or an eligible institution which is a customer of Morgan (an "Eligible
Institution"). Investors may also be employer-sponsored retirement plans that
have designated the Fund as an investment option for the plans. Prospective in-
vestors who are not already customers of Morgan may apply to become customers
of Morgan for the sole purpose of Fund transactions. There are no charges asso-
ciated with becoming a Morgan customer for this purpose. Morgan reserves the
right to determine the customers that it will accept, and the Fund reserves the
right to determine the purchase orders that it will accept.

The Fund requires a minimum initial investment of $5,000.

PURCHASE PRICE AND SETTLEMENT. The Fund's shares are sold on a continuous basis
without a sales charge at the net asset value per share next determined after
receipt of an order. Prospective investors may purchase shares with the assis-
tance of an Eligible Institution that may establish its own terms, conditions
and charges.

To purchase shares in the Fund, investors should request their Morgan represen-
tative (or a representative of their Eligible Institution) to assist them in
placing a purchase order with the Fund's Distributor and to transfer immedi-
ately available funds to the Fund's Distributor on the next business day. If
the Fund receives a purchase order prior to 4:00 P.M. New York time on any
business day, the purchase of Fund shares is effective and is made at the net
asset value determined that day and the purchaser generally becomes a holder of
record on the next business day upon the Fund's receipt of payment. If the Fund
receives a purchase order after 4:00 P.M. New York time, the purchase is effec-
tive and is made at the net asset value determined on the next business day,
and the purchaser becomes a holder of record on the following business day upon
the Fund's receipt of payment.

ELIGIBLE INSTITUTIONS. The services provided by Eligible Institutions may in-
clude establishing and maintaining shareholder accounts, processing purchase
and redemption transactions, arranging for bank wires, performing shareholder
sub- accounting, answering client inquiries regarding the Trust, assisting cli-
ents in changing dividend options, account designations and addresses, provid-
ing periodic statements showing the client's account balance and integrating
these statements with those of other transactions and balances in the client's
other accounts serviced by the Eligible Institution, transmitting proxy state-
ments, periodic reports, updated prospectuses and other communications to
shareholders and, with respect to meetings of shareholders, collecting, tabu-
lating and forwarding executed proxies and obtaining such other infor-

13
<PAGE>

mation and performing such other services as Morgan or the Eligible Institu-
tion's clients may reasonably request and agree upon with the Eligible Insti-
tution. Eligible Institutions may separately establish their own terms, condi-
tions and charges for providing the aforementioned services and for providing
other services.

REDEMPTION OF SHARES

METHOD OF REDEMPTION. To redeem shares in the Fund, an investor may instruct
Morgan or his or her Eligible Institution, as appropriate, to submit a redemp-
tion request to the Fund. The Fund executes effective redemption requests at
the next determined net asset value per share. See Net Asset Value. See Addi-
tional Information below for an explanation of the telephone redemption policy
of The JPM Advisor Funds.

A redemption request received by the Fund prior to 4:00 P.M. New York time is
effective on that day. A redemption request received after that time becomes
effective on the next business day. Proceeds of an effective redemption are
generally deposited the next business day in immediately available funds to
the shareholder's account at Morgan or at his or her Eligible Institution or,
in the case of certain Morgan customers, are mailed by check or wire trans-
ferred in accordance with the customer's instructions and, subject to Further
Redemption Information below, in any event are paid within seven days.

FURTHER REDEMPTION INFORMATION. Investors should be aware that redemptions
from the Fund may not be processed if a redemption request is not submitted in
proper form. To be in proper form, the Fund must have received the sharehold-
er's taxpayer identification number and address. As discussed under Taxes be-
low, the Fund may be required to impose "back-up" withholding of federal in-
come tax on dividends, distributions and redemption proceeds when noncorporate
investors have not provided a certified taxpayer identification number. In ad-
dition, if a shareholder sends a check for the purchase of Fund shares and
shares are purchased before the check has cleared, the transmittal of redemp-
tion proceeds from the shares will occur upon clearance of the check which may
take up to 15 days.

The Fund reserves the right to suspend the right of redemption and to postpone
the date of payment upon redemption for up to seven days and for such other
periods as the 1940 Act or the Securities and Exchange Commission may permit.
See Redemption of Shares in the Statement of Additional Information.

EXCHANGE OF SHARES

An investor may exchange shares from the Fund into any other JPM Advisor Fund
without charge. Shares are exchanged on the basis of relative net asset value
per share. Exchanges are in effect redemptions from one fund and purchases of
another fund and the usual purchase and redemption procedures and requirements
are applicable to exchanges. See Purchase of Shares and Redemption of Shares
in this Prospectus and in the prospectuses for the other JPM Advisor Funds.
See also Additional Information below for an explanation of the telephone ex-
change policy of The JPM Advisor Funds.

Shareholders subject to federal income tax who exchange shares in one fund for
shares in another fund may recognize capital gain or loss for federal income
tax purposes. The Fund reserves the right to discontinue, alter or limit its
exchange privilege at any time. For investors in certain states, state securi-
ties laws may restrict the availability of the exchange privilege.

DIVIDENDS AND DISTRIBUTIONS

Dividends consisting of substantially all of the Fund's net investment income,
if any, are declared and paid twice a year. The Fund may also declare an addi-
tional dividend of net investment income in a given year to the extent neces-
sary to avoid the imposition of federal excise tax on the Fund.

14
<PAGE>

Substantially all the realized net capital gains, if any, of the Fund are de-
clared and paid on an annual basis, except that an additional capital gains
distribution may be made in a given year to the extent necessary to avoid the
imposition of federal excise tax on the Fund. Declared dividends and distribu-
tions are payable to shareholders of record on the record date.

Dividends and capital gains distributions paid by the Fund are automatically
reinvested in additional shares of the Fund unless the shareholder has elected
to have them paid in cash. Dividends and distributions to be paid in cash are
credited to the shareholder's account at Morgan or at his Eligible Institution
or, in the case of certain Morgan customers, are mailed by check in accordance
with the customer's instructions. The Fund reserves the right to discontinue,
alter or limit the automatic reinvestment privilege at any time.

NET ASSET VALUE

Net asset value per share for the Fund is determined by subtracting from the
value of the Fund's total assets (i.e., the value of its investment in the
Portfolio and other assets) the amount of its liabilities and dividing the re-
mainder by the number of its outstanding shares, rounded to the nearest cent.
Expenses, including the fees payable to Morgan, are accrued daily. See Net As-
set Value in the Statement of Additional Information for information on valua-
tion of portfolio securities for the Portfolio.

The Fund computes its net asset value once daily at 4:15 P.M. New York time on
Monday through Friday, except that the net asset value is not computed for the
Fund on a day in which no orders to purchase or redeem Fund shares have been
received or on the holidays listed under Net Asset Value in the Statement of
Additional Information.

ORGANIZATION

The Trust was organized on September 16, 1994 as an unincorporated business
trust under Massachusetts law and is an entity commonly known as a "Massachu-
setts business trust". The Declaration of Trust permits the Trustees to issue
an unlimited number of full and fractional shares ($0.001 par value) of one or
more series. To date, nine series of shares, have been authorized and are
available for sale to the public. Only shares of the Fund are offered through
this Prospectus. No series of shares has any preference over any other series
of shares. See Massachusetts Trust in the Statement of Additional Information.

The Declaration of Trust for the Trust provides that no Trustee, shareholder,
officer, employee, or agent of the Fund shall be held to any personal liabili-
ty, nor shall resort be had to their private property for the satisfaction of
any obligation or claim or otherwise in connection with the affairs of the
Fund, but that the Trust property only shall be liable.

Shareholders of the Fund are entitled to one vote for each share and to the ap-
propriate fractional vote for each fractional share. There is no cumulative
voting. Shares have no preemptive or conversion rights. Shares are fully paid
and non- assessable by the Fund. The Trust has adopted a policy of not issuing
share certificates. The Trust does not intend to hold meetings of shareholders
annually. The Trustees may call meetings of shareholders for action by share-
holder vote as may be required by either the 1940 Act or the Declaration of
Trust. The Trustees will call a meeting of shareholders to vote on removal of a
Trustee upon the written request of the record holders of ten percent of Trust
shares and will assist shareholders in communicating with each other as pre-
scribed in Section 16(c) of the 1940 Act. For further organization information,
including certain shareholder rights, see Description of Shares in the State-
ment of Additional Information.

The Portfolio, in which all the assets of the Fund are invested, is organized
as a trust under the laws of the State of New York. The Portfolio's Declaration
of Trust provides that the Fund and other entities investing in the Portfolio
(e.g., other investment companies, insurance company separate accounts and com-
mon and commingled trust funds) will each be liable for all obligations of the
Portfolio. However, the risk of the Fund incurring financial loss on account of
such liability is limited to circumstances in which both inadequate insurance
existed and the Portfolio itself was unable to meet its obligations. According-
ly, the Trustees of the Trust believe that neither the Fund nor its sharehold-
ers will be adversely affected by reason of the Fund's investing in the Portfo-
lio.

15
<PAGE>

TAXES

The following discussion of tax consequences is based on U.S. federal tax laws
in effect on the date of this Prospectus. These laws and regulations are sub-
ject to change by legislative or administrative action. Investors are urged to
consult their own tax advisors with respect to specific questions as to federal
taxes and with respect to the applicability of state or local taxes. See Taxes
in the Statement of Additional Information. Annual statements as to the current
federal tax status of distributions, if applicable, are mailed to shareholders
after the end of the taxable year for the Fund.

The Trust intends to qualify the Fund as a separate regulated investment com-
pany under Subchapter M of the Code. For the Fund to qualify as a regulated in-
vestment company, the Portfolio limits its investments so that at the close of
each quarter of its taxable year (a) no more than 25% of its total assets are
invested in the securities of any one issuer, except U.S. Government securi-
ties, and (b) with regard to 50% of its total assets, no more than 5% of its
total assets are invested in the securities of a single issuer, except U.S.
Government securities. As a regulated investment company, the Fund should not
be subject to federal income taxes or federal excise taxes if all of its net
investment income and capital gains less any available capital loss
carryforwards are distributed to shareholders within allowable time limits. The
Portfolio intends to qualify as an association treated as a partnership for
federal income tax purposes. As such, the Portfolio should not be subject to
tax. The Fund's status as a regulated investment company is dependent on, among
other things, the Portfolio's continued qualification as a partnership for fed-
eral income tax purposes.

If a correct and certified taxpayer identification number is not on file, the
Fund is required, subject to certain exemptions, to withhold 31% of certain
payments made or distributions declared to noncorporate shareholders.

Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses are taxable as ordinary income
to shareholders of the Fund whether such distributions are taken in cash or re-
invested in additional shares. The Fund expects a portion of the distributions
of this type to corporate shareholders of the Fund to be eligible for the divi-
dends-received deduction.

Distributions of net long-term capital gains in excess of net short-term capi-
tal losses are taxable to shareholders of the Fund as long-term capital gains
regardless of how long a shareholder has held shares in the Fund and regardless
of whether taken in cash or reinvested in additional shares. Long-term capital
gains distributions to corporate shareholders are not eligible for the divi-
dends-received deduction.

Any distribution of net investment income or capital gains will have the effect
of reducing the net asset value of the Fund's shares held by a shareholder by
the same amount as the distribution. If the net asset value of the shares is
reduced below a shareholder's cost as a result of such a distribution, the dis-
tribution, although constituting a return of capital to the shareholder, will
be taxable as described above.

Any gain or loss realized on the redemption or exchange of Fund shares by a
shareholder who is not a dealer in securities will be treated as long-term cap-
ital gain or loss if the shares have been held for more than one year, and oth-
erwise as short-term capital gain or loss. However, any loss realized by a
shareholder upon the redemption or exchange of shares in the Fund held for six
months or less will be treated as a long-term capital loss to the extent of any
long-term capital gain distributions received by the shareholder with respect
to such shares.

ADDITIONAL INFORMATION

The Fund sends to its shareholders annual and semi-annual reports. The finan-
cial statements appearing in annual reports are audited by independent accoun-
tants. Shareholders also will be sent confirmations of each purchase and re-
demption and monthly statements, reflecting all other account activity, includ-
ing dividends and any distributions reinvested in additional shares or credited
as cash.

16
<PAGE>

All shareholders are given the privilege to initiate transactions automati-
cally by telephone upon opening an account. However, an investor should be
aware that a transaction authorized by telephone and reasonably believed to be
genuine by the Fund, Morgan, his or her Eligible Institution or the Distribu-
tor may subject the investor to risk of loss if such instruction is subse-
quently found not to be genuine. The Fund will employ reasonable procedures,
including requiring investors to give their Personal Identification Number and
tape recording of telephone instructions, to confirm that instructions commu-
nicated from investors by telephone are genuine; if it does not, the Fund, the
Services Agent or a shareholder's Eligible Institution may be liable for any
losses due to unauthorized or fraudulent instructions.

The Fund may make historical performance information available and may compare
its performance to other investments or relevant indexes, including data from
Lipper Analytical Services, Inc., Micropal Inc., Morningstar Inc., Ibbotson
Associates, Standard & Poor's 500 Composite Stock Price Index, the Dow Jones
Industrial Average, the Frank Russell Indexes and other industry publications.

The Fund may advertise "total return" and non-standardized total return data.
The total return shows what an investment in the Fund would have earned over a
specified period of time (one, five or ten years or since commencement of op-
erations, if less) assuming that all distributions and dividends by the Fund
were reinvested on the reinvestment dates during the period and less all re-
curring fees. This method of calculating total return is required by regula-
tions of the Securities and Exchange Commission. Total return data similarly
calculated, unless otherwise indicated, over other specified periods of time
may also be used. See Performance Data in the Statement of Additional Informa-
tion. All performance figures are based on historical earnings and are not in-
tended to indicate future performance. Performance information may be obtained
by calling the Fund's Distributor at (800) 847-9487.

17
<PAGE>

APPENDIX

The Portfolio may (a) purchase exchange traded and over-the-counter put and
call options on equity securities or indexes of equity securities, (b) purchase
and sell futures contracts on indexes of equity securities and (c) purchase put
and call options on futures contracts on indexes of equity securities. Each of
these instruments is a derivative instrument, as its value derives from the un-
derlying asset or index.

The Portfolio may use futures contracts and options for hedging purposes. The
Portfolio may not use futures contracts and options for speculation.

OPTIONS

PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the Portfolio ob-
tains the right (but not the obligation) to sell the instrument underlying the
option at a fixed strike price. In return for this right, the Portfolio pays
the current market price for the option (known as the option premium). Options
have various types of underlying instruments, including specific securities,
indexes of securities, indexes of securities prices, and futures contracts. The
Portfolio may terminate its position in a put option it has purchased by al-
lowing it to expire or by exercising the option. The Portfolio may also close
out a put option position by entering into an offsetting transaction, if a liq-
uid market exists. If the option is allowed to expire, the Portfolio will lose
the entire premium it paid. If the Portfolio exercises a put option on a secu-
rity, it will sell the instrument underlying the option at the strike price. If
the Portfolio exercises an option on an index, settlement is in cash and does
not involve the actual sale of securities. If an option is American style, it
may be exercised on any day up to its expiration date. A European style option
may be exercised only on its expiration date.

The buyer of a typical put option can expect to realize a gain if the price of
the underlying instrument falls substantially. However, if the price of the in-
strument underlying the option does not fall enough to offset the cost of pur-
chasing the option, a put buyer can expect to suffer a loss (limited to the
amount of the premium paid, plus related transaction costs).

The features of call options are essentially the same as those of put options,
except that the purchaser of a call option obtains the right to purchase,
rather than sell, the instrument underlying the option at the option's strike
price. A call buyer typically attempts to participate in potential price in-
creases of the instrument underlying the option with risk limited to the cost
of the option if security prices fall. At the same time, the buyer can expect
to suffer a loss if security prices do not rise sufficiently to offset the cost
of the option.

OPTIONS ON INDEXES. The Portfolio may purchase put and call options on any se-
curities index based on securities in which the Portfolio may invest. Options
on securities indexes are similar to options on securities, except that the ex-
ercise of securities index options is settled by cash payment and does not in-
volve the actual purchase or sale of securities. In addition, these options are
designed to reflect price fluctuations in a group of securities or segment of
the securities market rather than price fluctuations in a single security. The
Portfolio, in purchasing index options, is subject to the risk that the value
of its portfolio securities may not change as much as an index because the
Portfolio's investments generally will not match the composition of an index.

For a number of reasons, a liquid market may not exist and thus the Portfolio
may not be able to close out an option position that it has previously entered
into. When the Portfolio purchases an over-the-counter option, it will be rely-
ing on its counterparty to perform its obligations, and the Portfolio may incur
additional losses if the counterparty is unable to perform.

FUTURES CONTRACTS

When the Portfolio purchases a futures contract, it agrees to purchase a speci-
fied quantity of an underlying instrument at a specified future date or to make
a cash payment based on the value of a securities index. When the Portfolio
sells a futures contract, it agrees to sell a specified quantity of the under-
lying instrument at a specified future date or to receive a

A-1
<PAGE>

cash payment based on the value of a securities index. The price at which the
purchase and sale will take place is fixed when the Portfolio enters into the
contract. Futures can be held until their delivery dates or the position can be
(and normally is) closed out before then. There is no assurance, however, that
a liquid market will exist when the Portfolio wishes to close out a particular
position.

When the Portfolio purchases a futures contract, the value of the futures con-
tract tends to increase and decrease in tandem with the value of its underlying
instrument. Therefore, purchasing futures contracts will tend to increase the
Portfolio's exposure to positive and negative price fluctuations in the under-
lying instrument, much as if it had purchased the underlying instrument direct-
ly. When the Portfolio sells a futures contract, by contrast, the value of its
futures position will tend to move in a direction contrary to the value of the
underlying instrument. Selling futures contracts, therefore, will tend to off-
set both positive and negative market price changes, much as if the underlying
instrument had been sold.

The purchaser or seller of a futures contract is not required to deliver or pay
for the underlying instrument unless the contract is held until the delivery
date. However, when the Portfolio buys or sells a futures contract it will be
required to deposit "initial margin" with its Custodian in a segregated account
in the name of its futures broker, known as a futures commission merchant
(FCM). Initial margin deposits are typically equal to a small percentage of the
contract's value. If the value of either party's position declines, that party
will be required to make additional "variation margin" payments equal to the
change in value on a daily basis. The party that has a gain may be entitled to
receive all or a portion of this amount. The Portfolio may be obligated to make
payments of variation margin at a time when it is disadvantageous to do so.
Furthermore, it may not always be possible for the Portfolio to close out its
futures positions. Until it closes out a futures position, the Portfolio will
be obligated to continue to pay variation margin. Initial and variation margin
payments do not constitute purchasing on margin for purposes of the Portfolio's
investment restrictions. In the event of the bankruptcy of an FCM that holds
margin on behalf of the Portfolio, the Portfolio may be entitled to return of
margin owed to it only in proportion to the amount received by the FCM's other
customers, potentially resulting in losses to the Portfolio.

The Portfolio will segregate liquid, high quality assets in connection with its
use of options and futures contracts to the extent required by the staff of the
Securities and Exchange Commission. Securities held in a segregated account
cannot be sold while the futures contract or option is outstanding, unless they
are replaced with other suitable assets. As a result, there is a possibility
that segregation of a large percentage of the Portfolio's assets could impede
portfolio management or the Portfolio's ability to meet redemption requests or
other current obligations.

For further information about the Portfolio's use of futures and options and a
more detailed discussion of associated risks, see Investment Objectives and
Policies in the Statement of Additional Information.

A-2
<PAGE>

THE JPM ADVISOR FUNDS

The JPM Advisor U.S. Fixed Income Fund

The JPM Advisor International Fixed Income Fund

The JPM Advisor U.S. Equity Fund

The JPM Advisor U.S. Small Cap Equity Fund

The JPM Advisor International Equity Fund

The JPM Advisor European Equity Fund

The JPM Advisor Asia Growth Fund

The JPM Advisor Japan Equity Fund

The JPM Advisor Emerging Markets Equity Fund

No dealer, salesman or any other person has been authorized to give any
information or to make any representations, other than those contained in this
Prospectus, in connection with the offer contained in this Prospectus and, if
given or made, such other information or representations must not be relied
upon as having been authorized by the Trust or the Distributor. This
Prospectus does not constitute an offer by the Trust or by the Distributor to
sell or a solicitation of any offer to buy any of the securities offered
hereby in any jurisdiction to any person to whom it is unlawful for the Trust
or the Distributor to make such offer in such jurisdiction.
ADVPROS404

The JPM Advisor U.S. Small Cap Equity Fund

PROSPECTUS

October 1, 1995

<PAGE>

PROSPECTUS

The JPM Advisor U.S. Equity Fund
6 St. James Avenue
Boston, Massachusetts 02116
For information call (800) JPM-3637

The JPM Advisor U.S. Equity Fund (the "Fund") seeks to provide a high total
return from a portfolio of selected equity securities. It is designed for in-
vestors who want an actively managed portfolio of selected equity securities
that seeks to outperform the S&P 500 Index.

UNLIKE OTHER MUTUAL FUNDS WHICH DIRECTLY ACQUIRE AND MANAGE THEIR OWN PORTFO-
LIO OF SECURITIES, THE FUND SEEKS TO ACHIEVE ITS INVESTMENT OBJECTIVE BY IN-
VESTING ALL OF ITS INVESTABLE ASSETS IN THE SELECTED U.S. EQUITY PORTFOLIO
(THE "PORTFOLIO"), A CORRESPONDING DIVERSIFIED OPEN-END MANAGEMENT INVESTMENT
COMPANY HAVING THE SAME INVESTMENT OBJECTIVE AS THE FUND. THE FUND INVESTS IN
THE PORTFOLIO THROUGH SIGNATURE FINANCIAL GROUP, INC.'S HUB AND SPOKE(R) FI-
NANCIAL SERVICES METHOD. HUB AND SPOKE(R) EMPLOYS A TWO-TIER MASTER-FEEDER
STRUCTURE AND IS A REGISTERED SERVICE MARK OF SIGNATURE FINANCIAL GROUP, INC.
SEE SPECIAL INFORMATION CONCERNING HUB AND SPOKE(R) ON PAGE 2.

The Portfolio is advised by Morgan Guaranty Trust Company of New York ("Mor-
gan" or the "Advisor").

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing and it should be retained
for future reference. Additional information about the Fund has been filed
with the Securities and Exchange Commission in a Statement of Additional In-
formation dated October 1, 1995 (as supplemented from time to time). This in-
formation is incorporated herein by reference and is available without charge
upon request from the Fund's Distributor, Signature Broker-Dealer Services,
Inc., 6 St. James Avenue, Boston, Massachusetts 02116, Attention: The JPM Ad-
visor Funds, or by calling (800) 847-9487.

THE DATE OF THIS PROSPECTUS IS OCTOBER 1, 1995
<PAGE>

TABLE OF CONTENTS

<TABLE>

<CAPTION>
PAGE
<S> <C>
Investors for Whom the Fund Is Designed.................................... 1
Financial Highlights....................................................... 3
Special Information Concerning Hub and Spoke(R)............................ 3
Investment Objective and Policies.......................................... 4
Risk Factors and Additional Investment Information......................... 5
Investment Restrictions.................................................... 9
Management of the Trust and the Portfolio.................................. 10
Shareholder Transaction.................................................... 13
Purchase of Shares......................................................... 13
</TABLE>

<TABLE>

<CAPTION>
PAGE
<S> <C>
Redemption of Shares....................................................... 14
Exchange of Shares......................................................... 14
Dividends and Distribution................................................. 15
Net Asset Value............................................................ 15
Organization............................................................... 15
Taxes...................................................................... 16
Additional Information..................................................... 17
Appendix................................................................... A-1
Options.................................................................... A-1
Futures Contracts.......................................................... A-1
</TABLE>

<PAGE>

The JPM Advisor U.S. Equity Fund

INVESTORS FOR WHOM THE FUND IS DESIGNED

The Fund is designed for investors who wish to participate primarily in the
U.S. equity markets. The Fund seeks to achieve its investment objective by in-
vesting all of its investable assets in The Selected U.S. Equity Portfolio, a
diversified open end management investment company having the same investment
objective as the Fund. Since the investment characteristics and experience of
the Fund will correspond directly with those of the Portfolio, the discussion
in this Prospectus focuses on the investments and investment policies of the
Portfolio. The net asset value of shares in the Fund fluctuates with changes in
the value of the investments in the Portfolio.

The Portfolio may make various types of investments in seeking its objective.
Among the permissible investments and investment techniques for the Portfolio
are futures contracts, options and forward contracts on foreign currencies. The
potential risks of investing in these derivative instruments are discussed in
Risk Factors and Additional Investment Information and the Appendix. The Port-
folio may also purchase certain privately placed securities. For further infor-
mation about these investments, see Investment Objective and Policies below.

The Fund requires a minimum initial investment of $5,000. See Purchase of
Shares.

This Prospectus describes the investment objective and policies, management and
operation of the Fund to enable investors to decide if the Fund suits their
needs. The Fund operates through Signature Financial Group, Inc.'s ("Signa-
ture") Hub and Spoke(R) financial services method. The Trustees of the Trust
believe that the Fund may achieve economies of scale over time by investing
through Hub and Spoke(R).

1
<PAGE>

EXPENSE TABLE

ANNUAL OPERATING EXPENSES*

<TABLE>
<S> <C>
Advisory Fees............................................................. 0.40%
Rule 12b-1 Fees........................................................... None
Other Expenses (after expense reimbursement).............................. 0.81%
----
Total Operating Expenses (after expense reimbursement).................... 1.21%
</TABLE>

* These expenses are based on estimated expenses of the Fund and the Portfolio
and estimated average net assets for the Fund's current fiscal year, after
reimbursement. Without such expected reimbursement, the estimated Total Oper-
ating Expenses would be equal on an annual basis to 1.30% of the estimated
average net assets of the Fund. See Management of the Trust and the Portfo-
lio.

EXAMPLE

An investor would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

<TABLE>
<S> <C>
1 Year..................................................................... $ 12
3 Years.................................................................... $ 38
5 Years.................................................................... $ 67
10 Years................................................................... $147
</TABLE>

2
<PAGE>

FINANCIAL HIGHLIGHTS

<TABLE>

<CAPTION>
FOR THE PERIOD
MARCH 24, 1995
(COMMENCEMENT OF
OPERATIONS) TO
MAY 31, 1995
----------------
<S> <C>
Net Asset Value, Beginning of Period.......................... $10.00
Income From Investment Operations:
Net Investment Income....................................... 0.10
Net Realized and Unrealized Gain from Portfolio............. 0.68
------
Total From Investment Operations.............................. 0.78
------
Net Asset Value, End of Period................................ $10.78
======
Total Return.................................................. 7.80%(a)
Ratios and Supplemental Data:
Net Assets at End of Period................................. $ 108
Ratios to Average Net Assets:
Expenses.................................................. 0.00%(b)
Net Investment Income..................................... 4.99%(b)
Decrease Reflected in the Above Expense Ratio due to
Expense Reimbursements................................... 2.50%(b)
</TABLE>

- -------

(a)Not annualized.

(b)Annualized.

SPECIAL INFORMATION CONCERNING HUB AND SPOKE(R)

The Trust and the Portfolio use certain proprietary rights, know-how and finan-
cial services referred to as Hub and Spoke(R). Hub and Spoke(R) is a registered
service mark of Signature. Signature Broker-Dealer Services, Inc. (the Trust's
and Portfolio's Administrator and the Trust's Distributor) is a wholly owned
subsidiary of Signature.

3
<PAGE>

mon and are present in other mutual fund structures. Information concerning
other holders of interests in the Portfolio is available from the Administrator
at (800) 847-9487.

INVESTMENT OBJECTIVE AND POLICIES

The investment objective of the Fund and the Portfolio is described below, to-
gether with the policies they employ in their effort to achieve this objective.
Additional information about the investment policies of the Fund and the Port-
folio appears in the Statement of Additional Information under Investment Ob-
jectives and Policies. There can be no assurance that the investment objective
of the Fund or the Portfolio will be achieved.

The Fund's investment objective is to provide a high total return from a port-
folio of selected equity securities. Total return will consist of realized and
unrealized capital gains and losses plus income. The Fund attempts to achieve
its investment objective by investing all of its investable assets in The Se-
lected U.S. Equity Portfolio, a diversified open-end management investment com-
pany having the same investment objective as the Fund. The Portfolio invests
primarily in the common stock of large and medium sized U.S. corporations. Un-
der certain market conditions, the Fund or the Portfolio may not be able to
achieve its investment objective.

4
<PAGE>

The Fund is designed for investors who want an actively managed portfolio of
selected equity securities that seeks to outperform the S&P 500 Index.

Morgan seeks to enhance the Portfolio's total return relative to that of the
universe of large and medium sized U.S. companies, typically represented by the
S&P 500 Index, through fundamental analysis, systematic stock valuation and
disciplined portfolio construction. Based on internal fundamental research,
Morgan uses a dividend discount model to rank companies within economic sectors
according to their relative value. From the universe of securities this model
shows as undervalued, Morgan selects stocks for the Portfolio based on a vari-
ety of criteria including the company's managerial strength, prospects for
growth and competitive position. Morgan may modestly under or over-weight se-
lected economic sectors against the S&P 500 Index's sector weightings to seek
to enhance the Portfolio's total return or reduce the fluctuation in its market
value relative to the Index.

The Portfolio intends to manage its portfolio actively in pursuit of its in-
vestment objective. The Portfolio does not intend to respond to short-term mar-
ket fluctuations or to acquire securities for the purpose of short-term trad-
ing; however, it may take advantage of short-term trading opportunities that
are consistent with its objective. To the extent the Portfolio engages in
short-term trading it may realize short-term capital gains or losses and incur
increased transaction costs. See Taxes below. The estimated annual portfolio
turnover rate for the Portfolio is generally not expected to exceed 100%.

EQUITY INVESTMENTS. During ordinary market conditions, the Advisor intends to
keep the Portfolio essentially fully invested with at least 65% of the Portfo-
lio's net assets invested in equity securities consisting of common stocks and
other securities with equity characteristics comprised of preferred stock, war-
rants, rights, convertible securities, trust certificates, limited partnership
interests and equity participations. The Portfolio's primary equity investments
are the common stock of large and medium-sized U.S. corporations and, to a lim-
ited extent, similar securities of foreign corporations. The common stock in
which the Portfolio may invest includes the common stock of any class or series
or any similar equity interest, such as trust or limited partnership interests.
These equity investments may or may not pay dividends and may or may not carry
voting rights. The Portfolio invests in securities listed on domestic or for-
eign securities exchanges and securities traded in domestic or foreign over-
the-counter markets, and may invest in certain restricted or unlisted securi-
ties.

FOREIGN INVESTMENTS. The Portfolio may invest in equity securities of foreign
corporations included in the S&P 500 Index or listed on a national securities
exchange. However, the Portfolio does not expect to invest more than 30% of its
assets at the time of purchase in securities of foreign issuers, nor does it
expect more than % to be in securities of foreign issuers. For further infor-
mation on foreign investments and foreign currency exchange transactions, see
Risk Factors and Additional Investment Information.

RISK FACTORS AND ADDITIONAL INVESTMENT INFORMATION

5
<PAGE>

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. The Portfolio may purchase money
market instruments on a when- issued or delayed delivery basis. Delivery of
and payment for these securities may take as long as a month or more after the
date of the purchase commitment. The value of these securities is subject to
market fluctuation during this period and for fixed income investments no in-
terest accrues to the Portfolio until settlement. At the time of settlement, a
when- issued security may be valued at less than its purchase price. The Port-
folio maintains with the Custodian a separate account with a segregated port-
folio of securities in an amount at least equal to these commitments. When en-
tering into a when-issued or delayed delivery transaction, the Portfolio will
rely on the other party to consummate the transaction; if the other party
fails to do so, the Portfolio may be disadvantaged. It is the current policy
of the Portfolio not to enter into when-issued commitments exceeding in the
aggregate 15% of the market value of the Portfolio's total assets less liabil-
ities other than the obligations created by these commitments.

6
<PAGE>

The Portfolio may use futures contracts and options for hedging purposes. The
Portfolio may not use futures contracts and options for speculation.

The use of options and futures is a highly specialized activity which involves
investment strategies and risks different from those associated with ordinary
portfolio securities transactions, and there can be no guarantee that their
use will increase the Portfolio's return. While the use of these instruments
by the Portfolio may reduce certain risks associated with owning its portfolio
securities, these techniques themselves entail certain other risks. If the Ad-
visor applies a strategy at an inappropriate time or judges market conditions
or trends incorrectly, options and futures strategies may lower the Portfo-
lio's return. Certain strategies limit the Portfolio's possibilities to real-
ize gains as well as limiting its exposure to losses. The Portfolio could also
experience losses if the prices of its options and futures positions were
poorly correlated with its other investments or if it could not close out its
positions because of an illiquid secondary market. In addition, the Portfolio
will incur transaction costs, including trading commissions and option premi-
ums, in connection with its futures and options transactions and these trans-
actions could significantly increase the Portfolio's turnover rate.

7
<PAGE>

8
<PAGE>

INVESTMENT RESTRICTIONS

9
<PAGE>

government securities, and (b) the Portfolio may not own more than 10% of the
outstanding voting securities of any one issuer.

The investment objective of the Fund and the Portfolio, together with the in-
vestment restrictions described below and in the Statement of Additional Infor-
mation, except as noted, are deemed fundamental policies, i.e., they may be
changed only with the approval of the holders of a majority of the outstanding
voting securities of the Fund and the Portfolio. The Fund has the same invest-
ment restrictions as the Portfolio, except that the Fund may invest all of its
investable assets in another open-end investment company with the same invest-
ment objective and restrictions (such as the Portfolio). References below to
the Portfolio's investment restrictions also include the Fund's investment re-
strictions.

The Portfolio may not (i) borrow money, except from banks for extraordinary or
emergency purposes and then only in amounts up to 10% of the value of the Port-
folio's total assets, taken at cost at the time of borrowing, or purchase secu-
rities while borrowings exceed 5% of its total assets; or mortgage, pledge or
hypothecate any assets except in connection with any such borrowings in amounts
up to 10% of the value of the Portfolio's net assets at the time of borrowing;
(ii) purchase securities or other obligations of issuers conducting their prin-
cipal business activity in the same industry if its investments in such indus-
try would exceed 25% of the value of the Portfolio's total assets, except this
limitation shall not apply to investments in U.S. Government securities; or
(iii) purchase securities of any issuer if, as a result of the purchase, more
than 5% of the total assets of the Portfolio would be invested in securities of
companies with fewer than three years of operating history (including predeces-
sors).

For a more detailed discussion of the above investment restrictions, as well as
a description of certain other investment restrictions, see Investment Restric-
tions in the Statement of Additional Information.

MANAGEMENT OF THE TRUST AND THE PORTFOLIO

TRUSTEES. Pursuant to the Declaration of Trust for the Trust, the Trustees of
the Trust decide upon matters of general policy and review the actions of the
Trust's Administrator, Distributor, Services Agent, and other service providers
and the performance of the Portfolio's Advisor. Pursuant to the Declaration of
Trust for the Portfolio, the Trustees of the Portfolio (who are not the same as
the Trustees of the Trust) have the same responsibilities for the Portfolio in-
cluding overseeing its service providers.

The Portfolio has entered into a Fund Services Agreement with Pierpont Group,
Inc. to assist the Trustees of the Portfolio in exercising their overall super-
visory responsibilities for the Portfolio's affairs. The fee to be paid by the
Portfolio under the agreement approximates the reasonable cost of Pierpont
Group, Inc. in providing these services. Pierpont Group, Inc. was organized in
1989 at the request of the Trustees of The Pierpont Family of Funds for the
purpose of providing these services at cost to those funds. The principal of-
fices of Pierpont Group, Inc. are located at 461 Fifth Avenue, New York, New
York 10017. For more information concerning the Trust's and the Portfolio's
Trustees and officers, see Trustees and Officers in the Statement of Additional
Information.

ADVISOR. The Fund has not retained the services of an investment adviser be-
cause the Fund seeks to achieve its investment objective by investing all of
its investable assets in the Portfolio. The Portfolio has retained the services
of Morgan as Investment Advisor. Morgan, with principal offices at 60 Wall
Street, New York, New York 10260, is a New York trust company which conducts a
general banking and trust business. Morgan is a wholly owned subsidiary of J.P.
Morgan & Co. Incorporated ("J.P. Morgan"), a bank holding company organized un-
der the laws of Delaware. Through offices in New York City and abroad, J.P.
Morgan, through the Advisor and other subsidiaries, offers a wide range of
services to governmental, institutional, corporate and individual customers and
acts as investment adviser to individual and institutional clients with com-
bined assets under management of over $165 billion (of which the Advisor ad-
vises over $26 billion). Morgan provides investment advice and portfolio man-
agement services to the Portfolio. Subject to the supervision

10
<PAGE>

of the Portfolio's Trustees, Morgan makes the Portfolio's day-to-day invest-
ment decisions, arranges for the execution of portfolio transactions and gen-
erally manages the Portfolio's investments. See Investment Advisor in the
Statement of Additional Information.

Morgan uses a sophisticated, disciplined, collaborative process for managing
all asset classes. For equity portfolios, this process utilizes fundamental
research, systematic stock selection and disciplined portfolio construction.
Morgan has managed portfolios of U.S. equity securities on behalf of its cli-
ents for over forty years. The portfolio managers making investments in U.S.
equity securities work in conjunction with Morgan's domestic equity analysts,
as well as capital market, credit and economic research analysts, traders and
administrative officers. The U.S. equity analysts each cover a different in-
dustry, monitoring a universe of 700 predominantly large and medium-sized U.S.
companies.

The following persons are primarily responsible for the day-to-day management
and implementation of Morgan's process for the Portfolio (the inception date
of each person's responsibility for the Portfolio and his business experience
for the past five years is indicated parenthetically): William B. Petersen,
Managing Director (since February, 1993, employed by Morgan since prior to
1990 as a portfolio manager of U.S. equity investments) and William M. Riegel,
Jr., Vice President (since February, 1993, employed by Morgan since prior to
1990 as a portfolio manager of U.S. equity investments).

As compensation for the services rendered and related expenses borne by Morgan
under the Investment Advisory Agreement with the Portfolio, the Portfolio has
agreed to pay Morgan a fee, which is computed daily and may be paid monthly,
at the annual rate of 0.40% of the Portfolio's average daily net assets.

ADMINISTRATOR AND DISTRIBUTOR. Under Administration Agreements with the Trust
and the Portfolio, Signature Broker-Dealer Services, Inc. ("SBDS") serves as
the Administrator for the Trust and the Portfolio and in that capacity super-
vises the Fund's and the Portfolio's day-to-day operations other than manage-
ment of the Portfolio's investments. In this capacity, SBDS administers and
manages all aspects of the Fund's and the Portfolio's day-to-day operations
subject to the supervision of the Trustees, except as set forth under Advisor,
Services Agent and Custodian. In connection with its responsibilities as Ad-
ministrator, SBDS (i) furnishes ordinary clerical and related services for
day-to-day operations including certain recordkeeping responsibilities; (ii)
takes responsibility for compliance with all applicable federal and state se-
curities and other regulatory requirements; (iii) is responsible for the reg-
istration of sufficient Fund shares under federal and state securities laws;
(iv) takes responsibility for monitoring the Fund's status as a regulated in-
vestment company under the Internal Revenue Code of 1986, as amended (the
"Code"); and (v) performs such administrative and managerial oversight of the
activities of the Trust's and the Portfolio's custodian and transfer agent as
the respective Trustees may direct from time to time. Under the terms of the
Services Agreement with Morgan, the fees of the Administrator for its services
to the Trust are covered by Morgan's expense undertakings described under
Services Agent below.

Under the Trust's Administration Agreement, the annual administration fee rate
is calculated based on the aggregate average daily net assets of The JPM Advi-
sor Funds, as well as The JPM Institutional Funds and The Pierpont Funds,
which are two other family of mutual funds for which SBDS acts as Administra-
tor. The fee rate is calculated daily in accordance with the following sched-
ule: 0.040% of the first $1 billion of these funds' aggregate average daily
net assets, 0.032% of the next $2 billion of these funds' aggregate average
daily net assets, 0.024% of the next $2 billion of these funds' aggregate av-
erage daily net assets and 0.016% of these funds' aggregate average daily net
assets in excess of $5 billion. This fee rate is then applied to the net as-
sets of the Fund.

11
<PAGE>

Under the Portfolio's Administration Agreement, the annual administration fee
rate is calculated based on the aggregate average daily net assets of the Port-
folio, as well as all of the other portfolios in which series of The JPM Advi-
sor Funds, The JPM Institutional Funds and The Pierpont Funds invest. The fee
rate is calculated daily in accordance with the following schedule: 0.010% of
the first $1 billion of these portfolios' aggregate average daily net assets,
0.008% of the next $2 billion of these portfolios' aggregate average daily net
assets, 0.006% of the next $2 billion of these portfolios' aggregate average
daily net assets and 0.004% of these portfolios' aggregate average daily net
assets in excess of $5 billion. This fee rate is then applied to the net assets
of the Portfolio. The Administrator may voluntarily waive a portion of its
fees.

SERVICES AGENT. Under a Services Agreement with the Trust, Morgan acts as Serv-
ices Agent to the Trust and provides shareholder services to shareholders of
the Fund. The agreement provides that Morgan is responsible for certain ac-
counting and operational services provided to the Fund, including services re-
lated to tax returns and financial reports. These services also include matters
related to computing the amount of dividends and the net asset value per share,
keeping the books of account and providing shareholder services to shareholders
of the Fund.

The Trust's Services Agreement provides for the Fund to pay Morgan a fee for
these services, which is computed daily and may be paid monthly, equal to 0.69%
of the Fund's average daily net assets.

CUSTODIAN. State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02101, serves as the Fund's and the Portfolio's Custodian and
Transfer and Dividend Disbursing Agent.

12
<PAGE>

In addition to the expenses that Morgan assumes under the Services Agreement,
Morgan has agreed that it will reimburse the Fund through at least September
30, 1996 to the extent necessary to maintain the Fund's total operating ex-
penses (which includes expenses of the Fund and the Portfolio) at the annual
rate of 1.21% of the Fund's average daily net assets. This limit on certain ex-
penses does not cover extraordinary increases in these expenses during the pe-
riod and no longer applies in the event of a precipitous decline in assets due
to unforeseen circumstances. There is no assurance that Morgan will continue
this waiver beyond the specified period, except as required by the following
sentence. Morgan has agreed to waive fees as necessary, if in any fiscal year
the sum of the Fund's expenses exceeds the limits set by applicable regulations
of state securities commissions. Such annual limits are currently 2.5% of the
first $30 million of average net assets, 2% of the next $70 million of such net
assets and 1.5% of such net assets in excess of $100 million for any fiscal
year.

SHAREHOLDER TRANSACTION

Investors may request either Morgan or their Eligible Institution, as defined
below, for assistance in placing orders to purchase, redeem or exchange shares
of the Fund.

Shareholders should address all inquiries to J.P. Morgan Funds Services, Morgan
Guaranty Trust Company of New York, 522 Fifth Avenue, New York, New York 10036
or call (800) JPM-3637.

The business days of the Fund and the Portfolio are the days the New York Stock
Exchange is open.

PURCHASE OF SHARES

The Fund requires a minimum initial investment of $5,000.

To purchase shares in the Fund, investors should request their Morgan represen-
tative (or a representative of their Eligible Institution) to assist them in
placing a purchase order with the Fund's Distributor and to transfer immedi-
ately available funds to the Fund's Distributor on the next business day. If
the Fund receives a purchase order prior to 4:00 P.M. New York time on any
business day, the purchase of Fund shares is effective and is made at the net
asset value determined that day, and the purchaser generally becomes a holder
of record on the next business day upon the Fund's receipt of payment. If the
Fund receives a purchase order after 4:00 P.M. New York time, the purchase is
effective and is made at the net asset value determined on the next business
day, and the purchaser becomes a holder of record on the following business day
upon the Fund's receipt of payment.

13
<PAGE>

accounting, answering client inquiries regarding the Trust, assisting clients
in changing dividend options, account designations and addresses, providing
periodic statements showing the client's account balance and integrating these
statements with those of other transactions and balances in the client's other
accounts serviced by the Eligible Institution, transmitting proxy statements,
periodic reports, updated prospectuses and other communications to sharehold-
ers and, with respect to meetings of shareholders, collecting, tabulating and
forwarding executed proxies and obtaining such other information and perform-
ing such other services as Morgan or the Eligible Institution's clients may
reasonably request and agree upon with the Eligible Institution. Eligible In-
stitutions may separately establish their own terms, conditions and charges
for providing the aforementioned services and for providing other services.

REDEMPTION OF SHARES

A redemption request received by the Fund prior to 4:00 P.M. New York time is
effective on that day. A redemption request received after that time becomes
effective on the next business day. Proceeds of an effective redemption are
generally deposited on the next business day in immediately available funds to
the shareholder's account at Morgan or at his or her Eligible Institution or,
in the case of certain Morgan customers, are mailed by check or wire trans-
ferred in accordance with the customer's instructions and, subject to Further
Redemption Information below, in any event are paid within seven days.

EXCHANGE OF SHARES

An investor may exchange shares from the Fund into any other JPM Advisor Fund,
without charge. Shares are exchanged on the basis of relative net asset value
per share. Exchanges are in effect redemptions from one fund and purchases of
another fund and the usual purchase and redemption procedures and requirements
are applicable to exchanges. See Purchase of Shares and Redemption of Shares
in this Prospectus and in the prospectuses for the other JPM Advisor Funds.
See also Additional Information below for an explanation of the telephone ex-
change policy of The JPM Advisor Funds.

14
<PAGE>

DIVIDENDS AND DISTRIBUTION

Dividends and capital gains distributions paid for the Fund are automatically
reinvested in additional shares of the Fund unless the shareholder has elected
to have them paid in cash. Dividends and distributions to be paid in cash are
credited to the shareholder's account at Morgan or at his Eligible Institution
or, in the case of certain Morgan customers, are mailed by check in accordance
with the customer's instructions. The Fund reserves the right to discontinue,
alter or limit the automatic reinvestment privilege at any time.

NET ASSET VALUE

ORGANIZATION

The Trust was organized on September 16, 1994 as an unincorporated business
trust under Massachusetts law and is an entity commonly known as a "Massachu-
setts business trust". The Declaration of Trust permits the Trustees to issue
an unlimited number of full and fractional shares ($0.001 par value) of one or
more series. To date, nine series of shares have been authorized and are avail-
able for sale to the public. Only shares of the Fund are offered through this
Prospectus. No series of shares has any preference over any other series of
shares. See Massachusetts Trust in the Statement of Additional Information.

15
<PAGE>

TAXES

Distributions of net investment income and realized net short-term capital
gains in excess of net long-term capital losses are taxable as ordinary income
to shareholders of the Fund whether such distributions are taken in cash or re-
invested in additional shares. The Fund expects a portion of the distributions
of this type to corporate shareholders to be eligible for the dividends-re-
ceived deduction.

Any distribution of net investment income or capital gains will have the effect
of reducing the net asset value of Fund shares held by a shareholder by the
same amount as the distribution. If the net asset value of the shares is re-
duced below a shareholder's cost as a result of such a distribution, the dis-
tribution, although constituting a return of capital to the shareholder, will
be taxable as described above.

16
<PAGE>

the Fund held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distributions received by the
shareholder with respect to such shares.

ADDITIONAL INFORMATION

The Fund sends to its shareholders annual and semi-annual reports. The finan-
cial statements appearing in annual reports are audited by independent accoun-
tants. Shareholders also will be sent confirmations of each purchase and re-
demption and monthly statements, reflecting all other account activity, in-
cluding dividends and any distributions reinvested in additional shares or
credited as cash.

17
<PAGE>

APPENDIX

The Portfolio may use futures contracts and options for hedging purposes. The
Portfolio may not use futures contracts and options for speculation.

OPTIONS

FUTURES CONTRACTS

A-1
<PAGE>

futures contract, it agrees to sell a specified quantity of the underlying in-
strument at a specified future date or to receive a cash payment based on the
value of a securities index. The price at which the purchase and sale will take
place is fixed when the Portfolio enters into the contract. Futures can be held
until their delivery dates or the position can be (and normally is) closed out
before then. There is no assurance, however, that a liquid market will exist
when the Portfolio wishes to close out a particular position.

A-2
<PAGE>

THE JPM ADVISOR FUNDS

The JPM Advisor U.S. Fixed Income Fund

The JPM Advisor International Fixed Income Fund

The JPM Advisor U.S. Equity Fund

The JPM Advisor U.S. Small Cap Equity Fund

The JPM Advisor International Equity Fund

The JPM Advisor European Equity Fund

The JPM Advisor Asia Growth Fund

The JPM Advisor Japan Equity Fund

The JPM Advisor Emerging Markets Equity Fund

The JPM Advisor U.S. Equity Fund

PROSPECTUS

October 1, 1995

<PAGE>
JPM472

THE JPM ADVISOR FUNDS

THE JPM ADVISOR U.S. FIXED INCOME FUND
THE JPM ADVISOR INTERNATIONAL FIXED INCOME FUND
THE JPM ADVISOR U.S. EQUITY FUND
THE JPM ADVISOR U.S. SMALL CAP EQUITY FUND
THE JPM ADVISOR INTERNATIONAL EQUITY FUND
THE JPM ADVISOR EMERGING MARKETS EQUITY FUND
THE JPM ADVISOR ASIA GROWTH FUND
THE JPM ADVISOR EUROPEAN EQUITY FUND
THE JPM ADVISOR JAPAN EQUITY FUND

STATEMENT OF ADDITIONAL INFORMATION

October 1, 1995

THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS, BUT CONTAINS
ADDITIONAL INFORMATION, WHICH SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS
FOR THE FUND OR FUNDS LISTED ABOVE AS SUPPLEMENTED FROM TIME TO TIME, WHICH MAY
BE OBTAINED UPON REQUEST FROM SIGNATURE BROKER-DEALER SERVICES, INC., ATTENTION:
THE JPM ADVISOR FUNDS (800) 847-9487.

<PAGE>

Table of Contents

PAGE

General . . . . . . . . . . . . . . . . . . . 1
Investment Objectives and Policies . . . . . . 1
Investment Restrictions . . . . . . . . . . . 24
Trustees and Officers . . . . . . . . . . . . 34
Investment Advisor . . . . . . . . . . . . . . 38
Administrator and Distributor . . . . . . . . 41
Services Agent . . . . . . . . . . . . . . . . 43
Custodian . . . . . . . . . . . . . . . . . . 46
Independent Accountants . . . . . . . . . . . 46
Expenses . . . . . . . . . . . . . . . . . . . 47
Purchase of Shares . . . . . . . . . . . . . . 47
Redemption of Shares . . . . . . . . . . . . . 48
Exchange of Shares . . . . . . . . . . . . . . 48
Dividends and Distributions . . . . . . . . . 49
Net Asset Value . . . . . . . . . . . . . . . 49
Performance Data . . . . . . . . . . . . . . . 50
Portfolio Transactions . . . . . . . . . . . . 53
Massachusetts Trust . . . . . . . . . . . . . 55
Description of Shares . . . . . . . . . . . . 56
Taxes . . . . . . . . . . . . . . . . . . . . 58
Additional Information . . . . . . . . . . . 62
Financial Statements . . . . . . . . . . . . . 63
Appendix A - Description of Securities
Ratings. . . . . . . . . . . . . . . . . . . . A-1
Appendix B - Investing in Japan
and Asian Growth Markets. . . . . . . . . . . B-1

<PAGE>

GENERAL

The JPM Advisor Funds is a family of open-end investment companies,
currently consisting of nine funds: The JPM Advisor U.S. Fixed Income Fund, The
JPM Advisor International Fixed Income Fund, The JPM Advisor U.S. Equity Fund,
The JPM Advisor U.S. Small Cap Equity Fund, The JPM Advisor International Equity
Fund, The JPM Advisor Emerging Markets Equity Fund, The JPM Advisor Asia Growth
Fund, The JPM Advisor European Equity Fund and The JPM Advisor Japan Equity Fund
(collectively, the "Funds"). Each of the Funds is a series of The JPM Advisor
Funds, an open-end management investment company formed as a Massachusetts
business trust (the "Trust") (where appropriate, references to the "Trust" refer
to the Trust acting on behalf of a Fund and references to a "Fund" refer to a
Fund acting through the Trust).

This Statement of Additional Information describes the investment
objectives and policies, management and operation of each of the Funds to enable
investors to select the Funds which best suit their needs. The Funds operate
through Signature Financial Group, Inc.'s Hub and Spoke(R) financial services
method.

This Statement of Additional Information provides additional
information with respect to the Funds, and should be read in conjunction with
the current Prospectuses. Capitalized terms not otherwise defined in this
Statement of Additional Information have the meanings accorded to them in the
Funds' Prospectuses. The Funds' executive offices are located at 6 St. James
Avenue, Boston, Massachusetts 02116.

INVESTMENT OBJECTIVES AND POLICIES

THE JPM ADVISOR U.S. FIXED INCOME FUND (the "U.S. Fixed Income Fund")
is designed to be an economical and convenient means of making substantial
investments in a broad range of corporate and government debt obligations and
related investments of domestic and foreign issuers, subject to certain quality
and other restrictions. See "Quality and Diversification Requirements." The U.S.
Fixed Income Fund's investment objective is to provide a high total return
consistent with moderate risk of capital and maintenance of liquidity. Although
the net asset value of the U.S. Fixed Income Fund will fluctuate, the U.S. Fixed
Income Fund attempts to conserve the value of its investments to the extent
consistent with its objective. The U.S. Fixed Income Fund attempts to achieve
its objective by investing all of its investable assets in The U.S. Fixed Income
Portfolio (the "U.S. Fixed Income Portfolio"), a diversified open-end management
investment company having the same investment objective as the U.S. Fixed Income
Fund.

The U.S. Fixed Income Portfolio attempts to achieve its investment
objective by investing primarily in high grade corporate and government debt
obligations and related securities of domestic and foreign issuers described in
the Prospectus and this Statement of Additional Information.

<PAGE>

INVESTMENT PROCESS

Duration/yield curve management: Morgan's duration decision begins with
an analysis of real yields, which its research indicates are generally a
reliable indicator of longer term interest rate trends. Other factors Morgan
studies with regard to interest rates include economic growth and inflation,
capital flows and monetary policy. Based on this analysis, Morgan forms a view
of the most likely changes in the level and shape of the yield curve -- as well
as the timing of those changes -- and sets the Portfolio's duration and maturity
structure accordingly. To help contain interest rate risk, Morgan typically
limits the overall duration of the Portfolio to a range between one year shorter
and one year longer than that of the Salomon Brothers Broad Investment Grade
Bond Index, the benchmark index.

Sector allocations: Sector allocations are driven by Morgan's
fundamental and quantitative analysis of the relative valuation of a broad array
of fixed income sectors. Specifically, Morgan utilizes market and credit
analysts to assess whether the current risk-adjusted yield spreads of various
sectors are likely to widen or narrow. Morgan then overweights (underweights)
those sectors its analysis indicates offer the most (least) relative value,
basing the speed and magnitude of these shifts on valuation considerations.

Security selection: Securities are selected by the portfolio manager,
with substantial input from Morgan's fixed income analysis and traders. Using
quantitative analysis as well as traditional valuation methods, Morgan's
applied- research analysts aim to optimize security selection within the bounds
of the Portfolio's investment objective. In addition, credit analysts --
supported by Morgan's equity analysts -- assess the creditworthiness of issuers
and counterparties. A dedicated trading desk contributes to security selection
by tracking new issuance, monitoring dealer inventories, and identifying
attractively priced bonds. The traders also handle all transactions for the
Portfolio.

THE JPM ADVISOR INTERNATIONAL FIXED INCOME FUND (the "International
Fixed Income Fund") is designed to be an economical and convenient means of
making substantial investments in a broad range of international fixed income
securities. The International Fixed Income Fund's investment objective is to
provide a high total return, consistent with moderate risk of capital, from a
portfolio of international fixed income securities. The International Fixed
Income Fund attempts to achieve its objective by investing all of its investable
assets in The Non-U.S. Fixed Income Portfolio (the "Non-U.S. Fixed Income
Portfolio"), a non-diversified open-end management investment company having the
same investment objective as the International Fixed Income Fund.

The Non-U.S. Fixed Income Portfolio attempts to achieve its investment
objective by investing primarily in high grade, non-dollar-denominated corporate
and government debt obligations of foreign issuers described in the Prospectus
and this Statement of Additional Information.

<PAGE>

INVESTMENT PROCESS

Duration management: The duration decision is central to Morgan's
investment process and begins with an analysis of economic conditions and real
yields in the countries that make up the Portfolio's universe. Based on this
analysis, fixed income portfolio managers forecast three potential paths
(optimistic, pessimistic, and most likely) that interest rates in each market
could follow over the next three and twelve months. These forecasts are
converted into return curves that enable Morgan to estimate the risk-return
profile of different portfolio durations. In each market, duration is set at its
"optimal" level-that is, at the level that Morgan believes will generate the
highest excess return per unit of excess risk, as measured against the
benchmark.

Country allocation: Morgan allocates the Portfolio's assets primarily
among the developed countries of the world outside the United States. Country
allocations are determined through and optimization procedure that ranks markets
according to the risks and returns inherent in their "optimal" durations.
Country weightings also reflect liquidity and credit quality considerations. To
help contain risk, Morgan typically limits the country-weighted duration of the
Portfolio to a range between one year shorter and one year longer than that of
the benchmark.

Sector/security selection: Holdings primarily consist of government and
government-guaranteed bonds, but also include publicly and privately traded
corporates, debt obligations of banks and bank holding companies and of
supranational organizations, and convertible securities. Sectors are over- or
under-weighted when Morgan perceives significant valuation distortions in their
yield spreads. Securities are selected by the portfolio manager, with
substantial input from fixed income analysts and traders as well as from
Morgan's extended network of equity analysts. Credit analysts monitor the
quality of current and prospective holdings and, in conjunction with the credit
committee, recommend purchases and sales.

THE JPM ADVISOR U.S. EQUITY FUND (the "U.S. Equity Fund") is designed
for investors who want an actively managed portfolio of selected equity
securities that seeks to outperform the S&P 500 Index. The U.S. Equity Fund's
investment objective is to provide a high total return from a portfolio of
selected equity securities. The Fund attempts to achieve its investment
objective by investing all of its investable assets in The Selected U.S. Equity
Portfolio (the "Selected U.S. Equity Portfolio"), a diversified open-end
management investment company having the same investment objective as the U.S.
Equity Fund.

In normal circumstances, at least 65% of the Selected U.S. Equity
Portfolio's net assets will be invested in equity securities consisting of
common stocks and other securities with equity characteristics comprised of
preferred stock, warrants, rights, convertible securities, trust certificates,
limited partnership interests and equity participations (collectively, "Equity
Securities"). The Selected U.S. Equity Portfolio's primary equity investments
are the common stock of large and medium-sized U.S. corporations and, to a
limited extent, similar securities of foreign corporations.

<PAGE>

INVESTMENT PROCESS

Fundamental research: Morgan's 20 domestic equity analysts, each an
industry specialist with an average of 13 years of experience, follow 700
predominantly large- and medium-sized U.S. companies -- 500 of which form the
universe for the Portfolio's investments. Their research goal is to forecast
normalized, longer term earnings and dividends for the most attractive companies
among those they cover. In doing this, they may work in concert with Morgan's
international equity analysts in order to gain a broader perspective for
evaluating industries and companies in today's global economy.

Systematic valuation: The analysts' forecasts are converted into
comparable expected returns by a dividend discount model, which calculates those
expected returns by comparing a company's current stock price with the "fair
value" price forecasted by its estimated long-term earnings power. Within each
sector, companies are ranked by their expected return and grouped into
quintiles; those with the highest expected returns (Quintile 1) are deemed the
most undervalued relative to their long-term earnings power, while those with
the lowest expected returns (Quintile 5) are deemed the most overvalued.

Disciplined portfolio construction: A diversified portfolio is
constructed using disciplined buy and sell rules. Purchases are concentrated
among first- quintile stocks; the specific names selected reflect the portfolio
manager's judgment concerning the soundness of the underlying forecasts, the
likelihood that the perceived misvaluation will be corrected within a reasonable
time frame, and the magnitude of the risks versus the rewards. Once a stock
falls into the third quintile -- because its price has risen or its fundamentals
have deteriorated -- it generally becomes a sale candidate. The portfolio
manager seeks to hold sector weightings close to those of the S&P 500 Index,
reflecting Morgan's belief that its research has the potential to add value at
the individual stock level, but not at the sector level. Sector neutrality is
also seen as a way to help to protect the portfolio from macroeconomic risks,
and -- together with diversification -- represents an important element of
Morgan's risk control strategy. Morgan's dedicated trading desk handles all
transactions for the Portfolio.

THE JPM ADVISOR U.S. SMALL CAP EQUITY FUND (the "U.S. Small Cap Equity
Fund") is designed for investors who are willing to assume the somewhat higher
risk of investing in small companies in order to seek a higher return over time
than might be expected from a portfolio of stocks of large companies. The U.S.
Small Cap Equity Fund's investment objective is to provide a high total return
from a portfolio of Equity Securities of small companies. The Fund attempts to
achieve its investment objective by investing all of its investable assets in
The U.S. Small Company Portfolio (the "U.S. Small Company Portfolio"), a
diversified open-end management investment company having the same investment
objective as the U.S. Small Cap Equity Fund.

The U.S. Small Company Portfolio attempts to achieve its investment
objective by investing primarily in the common stock of small U.S. companies
included in the Russell 2500 Index, which is composed of 2,500 common stocks of

<PAGE>

U.S. companies with market capitalizations ranging between $100 million and $1.5
billion.

INVESTMENT PROCESS

Fundamental research: Morgan's 20 domestic equity analysts -- each an
industry specialist with an average of 13 years of experience -- continuously
monitor the small cap stocks in their respective sectors with the aim of
identifying companies that exhibit superior financial strength and operating
returns. Meetings with management and on-site visits play a key role in shaping
their assessments. Their research goal is to forecast normalized, long-term
earnings and dividends for the most attractive small cap companies among those
they monitor -- a universe that generally contains a total of 300-350 names.
Because Morgan's analysts follow both the larger and smaller companies in their
industries -- in essence, covering their industries from top to bottom -- they
are able to bring broad perspective to the research they do on both.

Systematic valuation: The analysts' forecasts are converted into
comparable expected returns by Morgan's dividend discount model, which
calculates those returns by comparing a company's current stock price with the
"fair value" price forecasted by its estimated long-term earnings power. Within
each industry, companies are ranked by their expected returns and grouped into
quintiles; those with the highest expected returns (Quintile 1) are deemed the
most undervalued relative to their long-term earnings power, while those with
the lowest expected returns (Quintile 5) are deemed the most overvalued.

Disciplined portfolio construction: A diversified portfolio is
constructed using disciplined buy and sell rules. Purchases are concentrated
among the stocks in the top two quintiles of the rankings; the specific names
selected reflect the portfolio manager's judgment concerning the soundness of
the underlying forecasts, the likelihood that the perceived misevaluation will
soon be corrected, and the magnitude of the risks versus the rewards. Once a
stock falls into the third quintile -- because its price has risen or its
fundamentals have deteriorated -- it generally becomes a sale candidate. The
portfolio manager seeks to hold sector weightings close to those of the Russell
2500 Index, the Portfolio's benchmark, reflecting Morgan's belief that its
research has the potential to add value at the individual stock level, but not
at the sector level. Sector neutrality is also seen as a way to help to protect
the portfolio from macroeconomic risks, and -- together with diversification --
represents an important element of Morgan's risk control strategy.

THE JPM ADVISOR INTERNATIONAL EQUITY FUND (the "International Equity
Fund") is designed for investors with a long-term investment horizon who want to
diversify their portfolios by investing in an actively managed portfolio of non-
U.S. securities that seeks to outperform the Morgan Stanley Europem Australia
and Far East Index (the "EAFE Index"). The International Equity Fund's
investment objective is to provide a high total return from a portfolio of
Equity Securities of foreign corporations. The Fund attempts to achieve its
investment objective by investing all of its investable assets in The Non-U.S.
Equity Portfolio (the "Non-U.S. Equity Portfolio"), a diversified open-end
management investment company having the same investment objective as the
International Equity Fund.

<PAGE>

The Non-U.S. Equity Portfolio seeks to achieve its investment objective
by investing primarily in the Equity Securities of foreign corporations. Under
normal circumstances, the Non-U.S. Equity Portfolio expects to invest at least
65% of its total assets in such securities. The Non-U.S. Equity Portfolio does
not intend to invest in U.S. securities (other than money market instruments),
except temporarily, when extraordinary circumstances prevailing at the same time
in a significant number of developed foreign countries render investments in
such countries inadvisable.

INVESTMENT PROCESS

Country allocation: Morgan's country allocation decision begins with a
forecast of equity risk premiums, which provide a valuation signal by measuring
the relative attractiveness of stocks versus bonds. Using a proprietary
approach, Morgan calculates this risk premium for each of the nations in the
Portfolio's universe, determines the extent of its deviation -- if any -- from
its historical norm, and then rank countries according to the size of those
deviations. Countries with high (low) rankings are overweighted (underweighted)
in comparisons to the EAFE Index to reflect the above-average (below-average)
attractiveness of their stock markets. In determining weightings, Morgan
analyzes a variety of qualitative factors as well -- including the liquidity,
earnings momentum and interest rate climate of the market at hand. These
qualitative assessments can change the magnitude but not the direction of the
country allocations called for by the risk premium forecast. Morgan places
limits on the total size of the Portfolio's country over- and under-weightings
relative to the EAFE Index.

Stock selection: Morgan's 44 international equity analysts, each an
industry and country specialist, forecast normalized earnings and dividend
payouts for roughly 1,000 non-U.S. companies -- taking a long-term perspective
rather than the short time frame common to consensus estimates. These forecasts
are converted into comparable expected returns by a dividend discount model, and
then companies are ranked from most to least attractive by industry and country.
A diversified portfolio is constructed using disciplined buy and sell rules. The
portfolio manager's objective is to concentrate the purchases in the top third
of the rankings, and to keep sector weightings close to those of the EAFE Index,
the Fund's benchmark. Once a stock falls into the bottom third of the rankings,
it generally becomes a sales candidate. Where available, warrants and
convertibles may be purchased instead of common stock if they are deemed a more
attractive means of investing in an undervalued company.

Currency management: Currency is actively managed, in conjunction with
country and stock allocation, with the goal of protecting and possibly enhancing
the Fund's return. Morgan's currency decisions are supported by a proprietary
tactical mode which forecasts currency movements based on an analysis of four
fundamental factors -- trade balance trends, purchasing power parity, real
short-term interest differentials, and real bond yields -- plus a technical
factor designed to improve the timing of transactions. Combining the output of
this model with a subjective assessment of economic political and market
factors, Morgan's currency group recommends currency strategies that are
implemented in conjunction with the portfolio's investment strategy.

<PAGE>

THE JPM ADVISOR EMERGING MARKETS EQUITY FUND (the "Emerging Markets
Equity Fund") is designed for investors with a long-term investment horizon who
want exposure to the rapidly growing emerging markets. The Emerging Markets
Equity Fund's investment objective is to provide a high total return from a
portfolio of Equity Securities of companies in emerging markets. The Fund
attempts to achieve its investment objective by investing all of its investable
assets in The Emerging Markets Equity Portfolio (the "Emerging Markets Equity
Portfolio"), a diversified open-end management investment company having the
same investment objective as the Emerging Markets Equity Fund.

The Emerging Markets Equity Portfolio seeks to achieve its investment
objective by investing primarily in Equity Securities of emerging markets
issuers. Under normal circumstances, the Portfolio expects to invest at least
65% of its total assets in such securities. The Portfolio does not intend to
invest in U.S. securities (other than money market instruments), except
temporarily, when extraordinary circumstances prevailing at the same time in a
significant number of emerging markets countries render investments in such
countries inadvisable.

INVESTMENT PROCESS

Country allocation: Morgan's country allocation decision begins with a
forecast of the expected return of each market in the Portfolio's universe.
These expected returns are calculated using a proprietary valuation method that
is forward looking in nature rather than based on historical data. Morgan then
evaluates these expected returns from two different perspectives: first, it
identifies those countries that have high real expected returns relative to
their own history and other nations in their universe. Second, it identifies
those countries that it expects will provide high returns relative to their
currency risk. Countries that rank highly on one or both of these scores are
overweighted relative to the Fund's benchmark, The IFC Investable Index, while
those that rank poorly are underweighted. To help contain risk, Morgan places
limits on the total size of the Portfolio's country over- and under-weightings.

Stock selection: Morgan's 12 emerging market equity analysts -- each an
industry specialist -- monitor a universe of approximately 900 companies in
these countries, developing forecasts of earnings and cash flows for the most
attractive among them. Companies are ranked from most to least attractive based
on this research, and then a diversified portfolio is constructed using
disciplined buy and sell rules. The portfolio manager's objective is to
concentrate the Portfolio's holdings in the stocks deemed most undervalued, and
to keep sector weightings relatively close to those of the index. Stocks are
generally held until they fall into the bottom half of Morgan's rankings.

THE JPM ADVISOR ASIA GROWTH FUND (the "Asia Growth Fund") is designed
for long-term investors who want access to the rapidly growing Asian markets.
The Asia Growth Fund's investment objective is to provide a high total return
from a portfolio of Equity Securities of companies in Asian growth markets. The
Asia Growth Fund attempts to achieve its investment objective by investing all
its investable assets in The Asia Growth Portfolio (the "Asia Growth
Portfolio"), a diversified open-end management investment company having the
same investment

<PAGE>

objective as the Asia Growth Fund. For additional information, see "Appendix B -
Investing in Japan and Asian Growth Markets."

The Asia Growth Portfolio seeks to achieve its investment objective by
investing primarily in the Equity Securities of companies in Asian growth
markets. Under normal circumstances, the Asia Growth Portfolio expects to invest
at least 65% of its total assets in such securities. The Asia Growth Portfolio
does not intend to invest in U.S. securities (other than money market
instruments), except temporarily, when extraordinary circumstances prevailing at
the same time in a significant number of countries considered to be Asian growth
markets render investments in such countries inadvisable.

INVESTMENT PROCESS

Country allocation: Morgan's country allocation decision begins with a
forecast of equity risk premiums, which provide a valuation signal by measuring
the relative attractiveness of stocks versus bonds. Using a proprietary
approach, Morgan calculates this risk premium for each of the nations in the
Portfolio's universe, determines the extent of its deviation -- if any -- from
its historical norm, and then ranks countries according to the size of these
deviations. Countries with high (low) rankings are overweighted (underweighted)
to reflect the above-average (below average) attractiveness of their stock
markets. In determining weightings, Morgan analyzes a variety of qualitative
factors as well -- including the liquidity, earnings momentum and interest rate
climate of the market at hand. These qualitative assessments can change the
magnitude but not the direction of the country allocations called for by the
risk-premium forecast. In an effort to contain risk, Morgan places limits on the
total size of the Portfolio's country over- and under-weightings.

Stock selection: Morgan's six Asian equity analysts focused on Asian
markets -- each an industry and country specialist -- forecast normalized,
long-term earnings and dividend payouts for approximately 250 companies in this
region. These forecasts are converted into comparable expected returns by a
dividend discount model, and then companies are ranked from most to least
attractive by industry and country, and are grouped into quintiles. A
diversified portfolio is constructed using disciplined buy and sell rules. The
portfolio manager's objective is to concentrate purchases in the top 20% of the
rankings, and to keep sector weightings close to those of the benchmark. Once a
stock falls into the third quintile -- because its price has risen or its
fundamentals have deteriorated -- it generally becomes a sale candidate. Where
available, warrants and convertibles are purchased when they appear to have the
potential to add value over common stock.

THE JPM ADVISOR EUROPEAN EQUITY FUND (the "European Equity Fund") is
designed for investors who want an actively managed portfolio of European Equity
Securities that seeks to outperform the Morgan Stanley Capital International
Europe Index which is comprised of more than 500 companies in fourteen European
countries. The European Equity Fund's investment objective is to provide a high
total return from a portfolio of Equity Securities of European companies. The
European Equity Fund attempts to achieve its investment objective by investing
all of its investable assets in The European Equity Portfolio (the "European

<PAGE>

Equity Portfolio"), a diversified open-end management investment company having
the same investment objective as the European Equity Fund.

The European Equity Portfolio seeks to achieve its investment objective
by investing primarily in the Equity Securities of European companies. Under
normal circumstances, the European Equity Portfolio expects to invest at least
65% of its total assets in such securities. The European Equity Portfolio does
not intend to invest in U.S. securities (other than money market instruments),
except temporarily, when extraordinary circumstances prevailing at the same time
in a significant number of European countries render investments in such
countries inadvisable.

INVESTMENT PROCESS

Country allocation: Morgan's country allocation decision begins with a
forecast of equity risk premiums, which provide a valuation signal by measuring
the relative attractiveness of stocks versus bonds. Using a proprietary
approach, Morgan calculates this risk premium for each of the nations in the
Portfolio's universe, determines the extent of its deviation -- if any -- from
its historical norm, and then ranks countries according to the size of those
deviations. Countries with high (low) rankings are overweighted (underweighted)
in comparison to the Morgan Stanley Capital International Europe Index to
reflect the above-average (below-average) attractiveness of their stock markets.
In determining weightings, Morgan analyzes a variety of qualitative factors as
well -- including the liquidity, earnings momentum and interest rate climate of
the market at hand. These qualitative assessments can change the magnitude but
not the direction of the country allocations called for by the risk-premium
forecast. In an effort to contain risk, Morgan place limits on the total size of
the Portfolio's country over- and under-weightings.

Stock selection: Morgan's 15 equity analysts, each an industry and
country specialist, forecast normalized earnings and dividend payouts for
roughly 600 companies, taking a long-term perspective rather than the short time
frame common to consensus estimates. The analysts' forecasts are converted into
comparable expected returns by a dividend discount model, and then companies are
ranked from most to least attractive by industry and country. A diversified
portfolio is constructed using disciplined buy and sell rules. The portfolio
manager's objective is to concentrate purchases in the top third of the
rankings, and to keep sector weightings close to those of the benchmark. Once a
stock falls into the bottom third of the rankings -- because its price has risen
or its fundamentals have deteriorated -- it generally becomes a sale candidate.

THE JPM JAPAN EQUITY FUND (the "Japan Equity Fund") is designed for
investors who want an actively managed portfolio of Japanese Equity Securities
that seeks to outperform the Tokyo Stock Price Index ("TOPIX"), a composite
market-capitalization weighted-index of all common stocks listed on the First
Section of the Tokyo Stock Exchange. The Japan Equity Fund's investment
objective is to provide a high total return from a portfolio of Equity
Securities of Japanese companies. The Japan Equity Fund attempts to achieve its
investment objective by investing all of its investable assets in The Japan
Equity Portfolio (the "Japan Equity Portfolio"), a non-diversified open-end
management investment

<PAGE>

company having the same investment objective as the Japan Equity Fund. For
additional information, see "Appendix B - Investing in Japan and Asian Growth
Markets."

The Japan Equity Portfolio seeks to achieve its investment objective by
investing primarily in the Equity Securities of Japanese companies. Under normal
circumstances, the Japan Equity Portfolio expects to invest at least 65% of its
total assets in such securities. The Japan Equity Portfolio does not intend to
invest in U.S. securities (other than money market instruments), except
temporarily, when extraordinary circumstances prevailing in Japan render
investments there inadvisable.

INVESTMENT PROCESS

Systematic valuation: Morgan's ten Japanese equity analysts in Tokyo --
each an industry specialist -- follow a total of over 300 Japanese companies.
The most attractive names in that universe are identified by a multifactor model
which screens for low price/earnings ratios, high earnings growth rates and high
sales/price ratios. Within each sector, this subset of the universe is ranked by
these three measures and broken into quintiles; the companies in the top
quintile are considered the most attractive ones from both a growth and
valuation viewpoint. To provide an additional check on the valuation of selected
companies, the analysts prepare normalized, long-term earnings and dividend
forecasts which are converted into comparable expected returns by a dividend
discount model.

Warrant/convertible strategy: Once a company has been identified as a
buy candidate, the portfolio manager analyzes the yields on the company's
available equity vehicles -- stocks, warrants and convertibles -- to determine
which appears the most attractive means of purchase. In an effort to enhance
potential returns, the Portfolio also trades among these vehicles -- a strategy
that seeks to capitalize on the inefficiencies that pervade the Japanese equity
market. If the Portfolio invests in a warrant, it will set aside cash in an
amount approximately equal to the difference in the price of the warrant and the
market value of the underlying common stock. The cash is invested in money
market instruments.

Disciplined portfolio construction: The portfolio is constructed using
disciplined buy and sell rules. The portfolio manager's objective is to
concentrate purchases in the top 20% of the rankings; the specific companies
selected reflect the portfolio manager's judgment concerning the liquidity of an
issue, the soundness of the underlying forecasts, and the magnitude of the risks
versus the rewards. Once a stock falls into the third quintile -- because its
price has risen or its fundamentals have deteriorated it generally becomes a
sale candidate. The portfolio manager strives to hold sector weightings close to
those of the benchmark in an effort to contain risk.

The following discussion supplements the information regarding the
investment objective of each of the Funds and the policies to be employed to
achieve this objective by their corresponding Portfolios as set forth above and
in the Prospectus. The investment objective of each Fund and its corresponding
Portfolio is identical. Accordingly, references below to a Fund also include the

<PAGE>

Fund's corresponding Portfolio; similarly, references to a Portfolio also
include the corresponding Fund that invests in the Portfolio unless the context
requires otherwise.

MONEY MARKET INSTRUMENTS

As discussed in the Prospectus, each Portfolio may invest in money
market instruments to the extent consistent with its investment objective and
policies. A description of the various types of money market instruments that
may be purchased by the Portfolios appears below. See "Quality and
Diversification Requirements."

U.S. TREASURY SECURITIES. Each of the Portfolios may invest in direct
obligations of the U.S. Treasury, including Treasury bills, notes and bonds, all
of which are backed as to principal and interest payments by the full faith and
credit of the United States.

ADDITIONAL U.S. GOVERNMENT OBLIGATIONS. Each of the Portfolios may
invest in obligations issued or guaranteed by U.S. Government agencies or
instrumentalities. These obligations may or may not be backed by the "full faith
and credit" of the United States. In the case of securities not backed by the
full faith and credit of the United States, each Portfolio must look principally
to the federal agency issuing or guaranteeing the obligation for ultimate
repayment, and may not be able to assert a claim against the United States
itself in the event the agency or instrumentality does not meet its commitments.
Securities in which each Portfolio may invest that are not backed by the full
faith and credit of the United States include, but are not limited to,
obligations of the Tennessee Valley Authority, the Federal Home Loan Mortgage
Corporation and the U.S. Postal Service, each of which has the right to borrow
from the U.S. Treasury to meet its obligations, and obligations of the Federal
Farm Credit System and the Federal Home Loan Banks, both of whose obligations
may be satisfied only by the individual credits of each issuing agency.
Securities which are backed by the full faith and credit of the United States
include obligations of the Government National Mortgage Association, the Farmers
Home Administration and the Export-Import Bank.

FOREIGN GOVERNMENT OBLIGATIONS. Each of the Portfolios, subject to its
applicable investment policies, may also invest in short-term obligations of
foreign sovereign governments or of their agencies, instrumentalities,
authorities or political subdivisions. These securities may be denominated in
the U.S. dollar or in another currency. See "Foreign Investments."

BANK OBLIGATIONS. Each of the Portfolios, unless otherwise noted in the
Prospectus or below, may invest in negotiable certificates of deposit, time
deposits and bankers' acceptances of (i) banks, savings and loan associations
and savings banks which have more than $2 billion in total assets (the "Asset
Limitation") and are organized under the laws of the United States or any state,
(ii) foreign branches of these banks or of foreign banks of equivalent size
(Euros) and (iii) U.S. branches of foreign banks of equivalent size (Yankees).
The Asset Limitation is not applicable to the Non-U.S. Fixed Income, Non-U.S.
Equity, Emerging Markets Equity, Asia Growth, European Equity and Japan Equity

<PAGE>

Portfolios. See "Foreign Investments." The Portfolios will not invest in
obligations for which the Advisor, or any of its affiliated persons, is the
ultimate obligor or accepting bank. Each of the Portfolios may also invest in
obligations of international banking institutions designated or supported by
national governments to promote economic reconstruction, development or trade
between nations (e.g., the European Investment Bank, the Inter-American
Development Bank or the World Bank).

COMMERCIAL PAPER. Each of the Portfolios may invest in commercial
paper, including master demand obligations. Master demand obligations are
obligations that provide for a periodic adjustment in the interest rate paid and
permit daily changes in the amount borrowed. Master demand obligations are
governed by agreements between the issuer and Morgan Guaranty Trust Company of
New York acting as agent, for no additional fee, in its capacity as investment
advisor to the Portfolios and as fiduciary for other clients for whom it
exercises investment discretion. The monies loaned to the borrower come from
accounts managed by the Advisor or its affiliates, pursuant to arrangements with
such accounts. Interest and principal payments are credited to such accounts.
The Advisor, acting as a fiduciary on behalf of its clients, has the right to
increase or decrease the amount provided to the borrower under an obligation.
The borrower has the right to pay without penalty all or any part of the
principal amount then outstanding on an obligation together with interest to the
date of payment. Since these obligations typically provide that the interest
rate is tied to the Federal Reserve commercial paper composite rate, the rate on
master demand obligations is subject to change. Repayment of a master demand
obligation to participating accounts depends on the ability of the borrower to
pay the accrued interest and principal of the obligation on demand which is
continuously monitored by the Advisor. Since master demand obligations typically
are not rated by credit rating agencies, a Portfolio may invest in such unrated
obligations only if at the time of an investment the obligation is determined by
the Advisor to have a credit quality which satisfies the Portfolio's quality
restrictions. See "Quality and Diversification Requirements." Although there is
no secondary market for master demand obligations, such obligations are
considered by the Portfolios to be liquid because they are payable upon demand.
The Portfolios do not have any specific percentage limitation on investments in
master demand obligations.

REPURCHASE AGREEMENTS. Each of the Portfolios may enter into repurchase
agreements with brokers, dealers or banks that meet the credit guidelines
approved by the Portfolio's Trustees. In a repurchase agreement, a Portfolio
buys a security from a seller that has agreed to repurchase the same security at
a mutually agreed upon date and price. The resale price normally is in excess of
the purchase price, reflecting an agreed upon interest rate. This interest rate
is effective for the period of time the Portfolio is invested in the agreement
and is not related to the coupon rate on the underlying security. A repurchase
agreement may also be viewed as a fully collateralized loan of money by a
Portfolio to the seller. The period of these repurchase agreements will usually
be short, from overnight to one week, and at no time will the Portfolios invest
in repurchase agreements for more than thirteen months. The securities which are
subject to repurchase agreements, however, may have maturity dates in excess of
thirteen months from the effective date of the repurchase agreement.

<PAGE>

Each Portfolio always will receive securities as collateral whose market value
is, and during the entire term of the agreement remains, at least equal to 100%
of the dollar amount invested by the Portfolio in each agreement plus accrued
interest, and the Portfolio will make payment for such securities only upon
physical delivery or upon evidence of book entry transfer to the account of the
Portfolio's custodian (the "Custodian").

Each of the Portfolios may make investments in other debt securities
with remaining effective maturities of not more than thirteen months, including
without limitation corporate and foreign bonds, asset-backed securities and
other obligations described in the Prospectus or this Statement of Additional
Information.

CORPORATE BONDS AND OTHER DEBT SECURITIES

As discussed in the Prospectus, the U.S. Fixed Income, Non-U.S. Fixed
Income and European Equity Portfolios may invest in bonds and other debt
securities of domestic and foreign issuers to the extent consistent with their
investment objectives and policies. A description of these investments appears
in the Prospectus and below. See "Quality and Diversification Requirements." For
information on short-term investments in these securities, see "Money Market
Instruments."

ASSET-BACKED SECURITIES. Asset-backed securities directly or indirectly
represent a participation interest in, or are secured by and payable from, a
stream of payments generated by particular assets such as motor vehicle or
credit card receivables. Payments of principal and interest may be guaranteed up
to certain amounts and for a certain time period by a letter of credit issued by
a financial institution unaffiliated with the entities issuing the securities.
The asset-backed securities in which a Portfolio may invest are subject to the
Portfolio's overall credit requirements. However, asset-backed securities, in
general, are subject to certain risks. Most of these risks are related to
limited interests in applicable collateral. For example, credit card debt
receivables are generally unsecured and the debtors are entitled to the
protection of a number of state and federal consumer credit laws, many of which
give such debtors the right to set off certain amounts on credit card debt
thereby reducing the balance due. Additionally, if the letter of credit is
exhausted, holders of asset-backed securities may also experience delays in
payments or losses if the full amounts due on underlying sales contracts are not
realized. Because asset-backed securities are relatively new, the market
experience in these securities is limited and the market's ability to sustain
liquidity through all phases of the market cycle has not been tested.

TAX EXEMPT OBLIGATIONS

As discussed in the Prospectus, in certain circumstances, the U.S.
Fixed Income Portfolio, may invest in tax exempt obligations to the extent
consistent with the Portfolio's investment objective and policies. A description
of the various types of tax exempt obligations which may be purchased by the
Portfolio appears in the Prospectus and below. See "Quality and Diversification
Requirements."

<PAGE>

MUNICIPAL BONDS. Municipal bonds are debt obligations issued by the
states, territories and possessions of the United States and the District of
Columbia, by their political subdivisions and by duly constituted authorities
and corporations. For example, states, territories, possessions and
municipalities may issue municipal bonds to raise funds for various public
purposes such as airports, housing, hospitals, mass transportation, schools,
water and sewer works. They may also issue municipal bonds to refund outstanding
obligations and to meet general operating expenses. Public authorities issue
municipal bonds to obtain funding for privately operated facilities, such as
housing and pollution control facilities, for industrial facilities or for water
supply, gas, electricity or waste disposal facilities.

Municipal bonds may be general obligation or revenue bonds. General
obligation bonds are secured by the issuer's pledge of its full faith, credit
and taxing power for the payment of principal and interest. Revenue bonds are
payable from revenues derived from particular facilities, from the proceeds of a
special excise tax or from other specific revenue sources. They are not
generally payable from the general taxing power of a municipality.

MUNICIPAL NOTES. Municipal notes are subdivided into three categories
of short-term obligations: municipal notes, municipal commercial paper and
municipal demand obligations.

Municipal notes are short-term obligations with a maturity at the time
of issuance ranging from six months to five years. The principal types of
municipal notes include tax anticipation notes, bond anticipation notes, revenue
anticipation notes, grant anticipation notes and project notes. Notes sold in
anticipation of collection of taxes, a bond sale, or receipt of other revenues
are usually general obligations of the issuing municipality or agency.

Municipal commercial paper typically consists of very short-term
unsecured negotiable promissory notes that are sold to meet seasonal working
capital or interim construction financing needs of a municipality or agency.
While these obligations are intended to be paid from general revenues or
refinanced with long-term debt, they frequently are backed by letters of credit,
lending agreements, note repurchase agreements or other credit facility
agreements offered by banks or institutions.

Municipal demand obligations are subdivided into two types: variable
rate demand notes and master demand obligations.

Variable rate demand notes are tax exempt municipal obligations or
participation interests that provide for a periodic adjustment in the interest
rate paid on the notes. They permit the holder to demand payment of the notes or
to demand purchase of the notes at a purchase price equal to the unpaid
principal balance, plus accrued interest either directly by the issuer or by
drawing on a bank letter of credit or guaranty issued with respect to such note.
The issuer of the municipal obligation may have a corresponding right to prepay
at its discretion the outstanding principal of the note plus accrued interest
upon notice comparable to that required for the holder to demand payment. The
variable rate demand notes in which the U.S. Fixed Income Portfolio may invest

<PAGE>

are payable, or are subject to purchase, on demand usually on notice of seven
calendar days or less. The terms of the notes provide that interest rates are
adjustable at intervals ranging from daily to six months, and the adjustments
are based upon the prime rate of a bank or other appropriate interest rate index
specified in the respective notes. Variable rate demand notes are valued at
amortized cost; no value is assigned to the right of the Portfolio to receive
the par value of the obligation upon demand or notice.

Master demand obligations are tax exempt municipal obligations that
provide for a periodic adjustment in the interest rate paid and permit daily
changes in the amount borrowed. The interest on such obligations is, in the
opinion of counsel for the borrower, exempt from federal income tax. For a
description of the attributes of master demand obligations, see "Money Market
Instruments" above. Although there is no secondary market for master demand
obligations, such obligations are considered by the U.S. Fixed Income Portfolio
to be liquid because they are payable upon demand. The U.S. Fixed Income
Portfolio has no specific percentage limitations on investments in master demand
obligations.

EQUITY INVESTMENTS

As discussed in the Prospectus, the Selected U.S. Equity, U.S. Small
Company, Non-U.S. Equity, European Equity, Emerging Markets Equity, Asia Growth
and Japan Equity Portfolios (collectively, the "Equity Portfolios") invest
primarily in Equity Securities. The Equity Securities in which the Equity
Portfolios invest include those listed on any domestic or foreign securities
exchange or traded in the over-the-counter market as well as certain restricted
or unlisted securities. A discussion of the various types of equity investments
which may be purchased by these Portfolios appears in the Prospectus and below.
See "Quality and Diversification Requirements."

EQUITY SECURITIES. The Equity Securities in which the Equity Portfolios
may invest may or may not pay dividends and may or may not carry voting rights.
Common stock occupies the most junior position in a company's capital structure.

The convertible securities in which the Equity Portfolios may invest
include any debt securities or preferred stock which may be converted into
common stock or which carry the right to purchase common stock. Convertible
securities entitle the holder to exchange the securities for a specified number
of shares of common stock, usually of the same company, at specified prices
within a certain period of time.

The terms of any convertible security determine its ranking in a
company's capital structure. In the case of subordinated convertible debentures,
the holders' claims on assets and earnings are subordinated to the claims of
other creditors, and are senior to the claims of preferred and common
shareholders. In the case of convertible preferred stock, the holders' claims on
assets and earnings are subordinated to the claims of all creditors and are
senior to the claims of common shareholders.

<PAGE>

WARRANTS

The Equity Portfolios may invest in warrants, which entitle the holder
to buy common stock from the issuer at a specific price (the strike price) for a
specific period of time. The strike price of warrants sometimes is much lower
than the current market price of the underlying securities, yet warrants are
subject to similar price fluctuations. As a result, warrants may be more
volatile investments than the underlying securities.

Warrants do not entitle the holder to dividends or voting rights with
respect to the underlying securities and do not represent any rights in the
assets of the issuing company. Also, the value of the warrant does not
necessarily change with the value of the underlying securities and a warrant
ceases to have value if it is not exercised prior to the expiration date.

FOREIGN INVESTMENTS

The Non-U.S. Fixed Income, Non-U.S. Equity, Emerging Markets Equity,
Asia Growth, European Equity and Japan Equity Portfolios make substantial
investments in foreign countries. The U.S. Fixed Income, Selected U.S. Equity
and U.S. Small Company Portfolios may invest in certain foreign securities. The
U.S. Fixed Income, Selected U.S. Equity and U.S. Small Company Portfolios do not
expect to invest more than 25%, 30% and 30%, respectively, of their total assets
at the time of purchase in securities of foreign issuers. The Selected U.S.
Equity and U.S. Small Company Portfolios do not expect more than 10% of their
respective foreign investments to be in securities which are not listed on a
national securities exchange or which are not denominated or principally traded
in the U.S. dollar. In the case of the U.S. Fixed Income Portfolio, any foreign
commercial paper must not be subject to foreign withholding tax at the time of
purchase. Foreign investments may be made directly in securities of foreign
issuers or in the form of American Depositary Receipts ("ADRs") and European
Depositary Receipts ("EDRs"). Generally, ADRs and EDRs are receipts issued by a
bank or trust company that evidence ownership of underlying securities issued by
a foreign corporation and that are designed for use in the domestic, in the case
of ADRs, or European, in the case of EDRs, securities markets.

Since investments in foreign securities may involve foreign currencies,
the value of a Portfolio's assets as measured in U.S. dollars may be affected
favorably or unfavorably by changes in currency rates and in exchange control
regulations, including currency blockage. Each of the Portfolios may enter into
forward commitments for the purchase or sale of foreign currencies in connection
with the settlement of foreign securities transactions or to manage the
Portfolio's currency exposure related to foreign investments. The Portfolios
will not enter into such commitments for speculative purposes.

For a description of the risks associated with investing in foreign
securities, see "Risk Factors and Additional Investment Information" in the
Prospectus.

<PAGE>

INVESTING IN JAPAN. Investing in Japanese securities may involve the
risks associated with investing in foreign securities generally. In addition,
because it invests in Japan, The International Equity Portfolio will be subject
to the general economic and political conditions in Japan.

Share prices of companies listed on Japanese stock exchanges and on the
Japanese OTC market reached historical peaks (which were later referred to as
the "bubble") as well as historically high trading volumes in 1989 and 1990.
Since then, stock prices in both markets decreased significantly, with listed
stock prices reaching their lowest levels in the third quarter of 1992 and OTC
stock prices reaching their lowest levels in the fourth quarter of 1992. During
the period from January 1, 1989 through December 31, 1994, the highest Nikkei
stock average and Nikkei OTC average were 38,915.87 and 4,149.20, respectively,
and the lowest for each were 14,309.41 and 1,099.32, respectively. There can be
no assurance that additional market corrections will not occur.

The common stocks of many Japanese companies continue to trade at high
price earnings ratios in comparison with those in the United States, even after
the recent market decline. Differences in accounting methods make it difficult
to compare the earnings of Japanese companies with those of companies in other
countries, especially the United States.

Since The International Equity Portfolio invests in securities
denominated in yen, changes in exchange rates between the U.S. dollar and the
yen affect the U.S. dollar value of The International Equity Portfolio's assets.
Such rate of exchange is determined by forces of supply and demand on the
foreign exchange markets. These forces are in turn affected by the international
balance of payments and other economic, political and financial conditions,
government intervention, speculation and other factors. See Foreign Currency
Exchange Transactions.

Japanese securities held by The International Equity Portfolio are not
registered with the SEC nor are the issuers thereof subject to its reporting
requirements. There may be less publicly available information about issuers of
Japanese securities than about U.S. companies and such issuers may not be
subject to accounting, auditing and financial reporting standards and
requirements comparable to those to which U.S. companies are subject.

Although the Japanese economy has grown substantially over the past
four decades, recently the rate of growth had slowed substantially. During 1991,
1992 and 1993, the Japanese economy grew at rates of 4.3%, 1.1% and 0.1%,
respectively, as measured by real gross domestic product.

Japan's success in exporting its products has generated a sizeable
trade surplus. Such trade surplus has caused tensions at times between Japan and
some of its trading partners. In particular, Japan's trade relations with the
United States have recently been the subject of discussion and negotiation
between the two nations. The United States has imposed certain measures designed
to address trade issues in specific industries. These measures and similar
measures in the future may adversely affect the performance of The International
Equity Portfolio.

<PAGE>

Japan's economy has typically exhibited low inflation and low interest
rates. There can be no assurance that low inflation and low interest rates will
continue, and it is likely that a reversal of such factors would adversely
affect the Japanese economy. Moreover, the Japanese economy may differ,
favorably or unfavorably, from the U.S. economy in such respects as growth of
gross national product, rate of inflation, capital reinvestment, resources,
self-sufficiency and balance of payments position.

Japan has a parliamentary form of government. In 1993 a coalition
government was formed which, for the first time since 1955, did not include the
Liberal Democratic Party. Since mid-1993, there have been several changes in
leadership in Japan. What, if any, effect the current political situation will
have on prospective regulatory reforms of the economy in Japan cannot be
predicted. Recent and future developments in Japan and neighboring Asian
countries may lead to changes in policy that might adversely affect The
International Equity Portfolio.

ADDITIONAL INVESTMENTS

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. Each of the Portfolios may
purchase securities on a when-issued or delayed delivery basis. For example,
delivery of and payment for these securities can take place a month or more
after the date of the purchase commitment. The purchase price and the interest
rate payable, if any, on the securities are fixed on the purchase commitment
date or at the time the settlement date is fixed. The value of such securities
is subject to market fluctuation and no interest accrues to a Portfolio until
settlement takes place. At the time a Portfolio makes the commitment to purchase
securities on a when-issued or delayed delivery basis, it will record the
transaction, reflect the value each day of such securities in determining its
net asset value and, if applicable, calculate the maturity for the purposes of
average maturity from that date. At the time of settlement, a when-issued
security may be valued at less than the purchase price. To facilitate such
acquisitions, each Portfolio will maintain with the Custodian a segregated
account with liquid assets, consisting of cash, U.S. Government securities or
other appropriate securities, in an amount at least equal to such commitments.
On delivery dates for such transactions, each Portfolio will meet its
obligations from maturities or sales of the securities held in the segregated
account and/or from cash flow. If a Portfolio chooses to dispose of the right to
acquire a when-issued security prior to its acquisition, it could, as with the
disposition of any other portfolio obligation, incur a gain or loss due to
market fluctuation. It is the current policy of each Portfolio not to enter into
when-issued commitments exceeding in the aggregate 15% of the market value of
the Portfolio's total assets, less liabilities other than the obligations
created by when-issued commitments.

INVESTMENT COMPANY SECURITIES. Securities of other investment companies
may be acquired by each of the Portfolios to the extent permitted under the 1940
Act. These limits require that, as determined immediately after a purchase is
made, (i) not more than 5% of the value of the Portfolio's total assets will be
invested in the securities of any one investment company, (ii) not more than 10%
of the value of its total assets will be invested in the aggregate in

<PAGE>

securities of investment companies as a group, and (iii) not more than 3% of the
outstanding voting stock of any one investment company will be owned by the
Portfolio. As a shareholder of another investment company, a Portfolio would
bear, along with other shareholders, its pro rata portion of the other
investment company's expenses, including advisory fees. These expenses would be
in addition to the advisory and other expenses that the Portfolio bears directly
in connection with its own operations.

REVERSE REPURCHASE AGREEMENTS. Each of the Portfolios may enter into
reverse repurchase agreements. In a reverse repurchase agreement, a Portfolio
sells a security and agrees to repurchase the same security at a mutually agreed
upon date and price. For purposes of the 1940 Act, it is also considered as the
borrowing of money by the Portfolio and, therefore, a form of leverage. The
Portfolios will invest the proceeds of borrowings under reverse repurchase
agreements. In addition, a Portfolio will enter into a reverse repurchase
agreement only when the interest income to be earned from the investment of the
proceeds is greater than the interest expense of the transaction. A Portfolio
will not invest the proceeds of a reverse repurchase agreement for a period
which exceeds the duration of the reverse repurchase agreement. A Portfolio may
not enter into reverse repurchase agreements exceeding in the aggregate
one-third of the market value of its total assets, less liabilities other than
the obligations created by reverse repurchase agreements. Each Portfolio will
establish and maintain with the Custodian a separate account with a segregated
portfolio of securities in an amount at least equal to its purchase obligations
under its reverse repurchase agreements.

MORTGAGE DOLLAR ROLL TRANSACTIONS. The U.S. Fixed Income Portfolio may
engage in mortgage dollar roll transactions with respect to mortgage securities
issued by the Government National Mortgage Association, the Federal National
Mortgage Association and the Federal Home Loan Mortgage Corporation. In a
mortgage dollar roll transaction, the Portfolio sells a mortgage backed security
and simultaneously agrees to repurchase a similar security on a specified future
date at an agreed upon price. During the roll period, the Portfolio will not be
entitled to receive any interest or principal paid on the securities sold. The
Portfolio is compensated for the lost interest on the securities sold by the
difference between the sales price and the lower price for the future repurchase
as well as by the interest earned on the reinvestment of the sales proceeds. The
Portfolio may also be compensated by receipt of a commitment fee. When the
Portfolio enters into a mortgage dollar roll transaction, liquid assets in an
amount sufficient to pay for the future repurchase are segregated with the
Custodian. Mortgage dollar roll transactions are considered reverse repurchase
agreements for purposes of the Portfolio's investment restrictions.

LOANS OF PORTFOLIO SECURITIES. Each of the Portfolios may lend its
securities if such loans are secured continuously by cash or equivalent
collateral or by a letter of credit in favor of the Portfolio at least equal at
all times to 100% of the market value of the securities loaned, plus accrued
interest. While such securities are on loan, the borrower will pay the Portfolio
any income accruing thereon. Loans will be subject to termination by the
Portfolios in the normal settlement time, generally five business days after
notice, or by the borrower on one day's notice. Borrowed securities must be

<PAGE>

returned when the loan is terminated. Any gain or loss in the market price of
the borrowed securities which occurs during the term of the loan inures to a
Portfolio and its respective investors. The Portfolios may pay reasonable
finders' and custodial fees in connection with a loan. In addition, a Portfolio
will consider all facts and circumstances including the creditworthiness of the
borrowing financial institution, and no Portfolio will make any loans in excess
of one year. The Portfolios will not lend their securities to any officer,
Trustee, Director, employee or other affiliate of the Portfolios, the Advisor or
the Distributor, unless otherwise permitted by applicable law.

PRIVATELY PLACED AND CERTAIN UNREGISTERED SECURITIES. Each of the
Portfolios may invest in privately placed, restricted, Rule 144A or other
unregistered securities as described in the Prospectus.

As to illiquid investments, a Portfolio is subject to a risk that
should the Portfolio decide to sell them when a ready buyer is not available at
a price the Portfolio deems representative of their value, the value of the
Portfolio's net assets could be adversely affected. Where an illiquid security
must be registered under the Securities Act of 1933, as amended (the "1933
Act"), before it may be sold, a Portfolio may be obligated to pay all or part of
the registration expenses, and a considerable period may elapse between the time
of the decision to sell and the time the Portfolio may be permitted to sell a
security under an effective registration statement. If, during such a period,
adverse market conditions were to develop, a Portfolio might obtain a less
favorable price than prevailed when it decided to sell.

QUALITY AND DIVERSIFICATION REQUIREMENTS

Each of the Portfolios, except the Non-U.S. Fixed Income and Japan
Equity Portfolios, intends to meet the diversification requirements of the 1940
Act. To meet these requirements, 75% of the assets of each of these Portfolios
is subject to the following fundamental limitations: (1) the Portfolio may not
invest more than 5% of its total assets in the securities of any one issuer,
except obligations of the U.S. Government, its agencies and instrumentalities,
and (2) the Portfolio may not own more than 10% of the outstanding voting
securities of any one issuer. As for the other 25% of the Portfolio's assets not
subject to the limitation described above, there is no limitation on investment
of these assets under the 1940 Act, so that all of such assets may be invested
in securities of any one issuer, subject to the limitation of any applicable
state securities laws. Investments not subject to the limitations described
above could involve an increased risk to a Portfolio should an issuer, or a
state or its related entities, be unable to make interest or principal payments
or should the market value of such securities decline.

Although the Non-U.S. Fixed Income and Japan Equity Portfolios are not
limited by the diversification requirements of the 1940 Act, these Portfolios
will comply with the diversification requirements imposed by the Internal
Revenue Code of 1986, as amended (the "Code"), for qualification as a regulated
investment company. To meet these requirements, each Portfolio must diversify
its holdings so that, with respect to 50% of the Portfolio's assets, no more
than 5% of its assets are invested in the securities of any one issuer other
than the

<PAGE>

U.S. Government at the close of each quarter of the Portfolio's taxable year.
The Portfolio may, with respect to the remaining 50% of its assets, invest up to
25% of its assets in the securities of any one issuer (except this limitation
does not apply to U.S. Government securities).

U.S. FIXED INCOME AND NON-U.S. FIXED INCOME PORTFOLIOS. The U.S. Fixed
Income and Non-U.S. Fixed Income Portfolios invest principally in a diversified
portfolio of "high grade" and "investment grade" securities. Investment grade
debt is rated, on the date of investment, within the four highest ratings of
Moody's, currently Aaa, Aa, A and Baa, or of Standard & Poor's, currently AAA,
AA, A and BBB, while high grade debt is rated, on the date of the investment,
within the two highest of such ratings. The U.S. Fixed Income Portfolio may also
invest up to 5% of its total assets in securities which are "below investment
grade." Such securities must be rated, on the date of investment, Ba by Moody's
or BB by Standard & Poor's. The Portfolios may invest in debt securities which
are not rated or other debt securities to which these ratings are not
applicable, if in the opinion of the Advisor, such securities are of comparable
quality to the rated securities discussed above. In addition, at the time the
Portfolios invest in any commercial paper, bank obligation or repurchase
agreement, the issuer must have outstanding debt rated A or higher by Moody's or
Standard & Poor's, the issuer's parent corporation, if any, must have
outstanding commercial paper rated Prime-1 by Moody's or A-1 by Standard &
Poor's, or if no such ratings are available, the investment must be of
comparable quality in the Advisor's opinion.

EQUITY PORTFOLIOS. The Equity Portfolios may invest in convertible debt
securities for which there are no specific quality requirements. In addition, at
the time the Portfolio invests in any commercial paper, bank obligation or
repurchase agreement, the issuer must have outstanding debt rated A or higher by
Moody's or Standard & Poor's, the issuer's parent corporation, if any, must have
outstanding commercial paper rated Prime-1 by Moody's or A-1 by Standard &
Poor's, or if no such ratings are available, the investment must be of
comparable quality in the Advisor's opinion. At the time the Portfolio invests
in any other short-term debt securities, they must be rated A or higher by
Moody's or Standard & Poor's, or if unrated, the investment must be of
comparable quality in the Advisor's opinion.

In determining suitability of investment in a particular unrated
security, the Advisor takes into consideration asset and debt service coverage,
the purpose of the financing, history of the issuer, existence of other rated
securities of the issuer and other relevant conditions, such as comparability to
other issuers.

OPTIONS AND FUTURES TRANSACTIONS

EXCHANGE TRADED AND OVER-THE-COUNTER OPTIONS. All options purchased or
sold by the Portfolios will be traded on a securities exchange or will be
purchased or sold by securities dealers (over-the-counter or OTC options) that
meet creditworthiness standards approved by the Portfolio's Board of Trustees.
While exchange-traded options are obligations of the Options Clearing
Corporation, in the case of OTC options, a Portfolio relies on the dealer from
which it purchased the option to perform if the option is exercised. Thus, when

<PAGE>

a Portfolio purchases an OTC option, it relies on the dealer from which it
purchased the option to make or take delivery of the underlying securities.
Failure by the dealer to do so would result in the loss of the premium paid by
the Portfolio as well as loss of the expected benefit of the transaction.

The staff of the Securities and Exchange Commission (the "SEC") has
taken the position that, in general, purchased OTC options and the underlying
securities used to cover written OTC options are illiquid securities. However, a
Portfolio may treat as liquid the underlying securities used to cover written
OTC options, provided it has arrangements with certain qualified dealers who
agree that the Portfolio may repurchase any option it writes for a maximum price
to be calculated by a predetermined formula. In these cases, the OTC option
itself would only be considered illiquid to the extent that the maximum
repurchase price under the formula exceeds the intrinsic value of the option.

FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS. The Portfolios
permitted to enter into futures and options transactions may purchase or sell
(write) futures contracts and purchase put and call options, including put and
call options on futures contracts. In addition, the Non-U.S. Fixed Income,
Emerging Markets Equity, Asia Growth, European Equity and Japan Equity
Portfolios may sell (write) uncovered put and call options on futures. Futures
contracts obligate the buyer to take and the seller to make delivery at a future
date of a specified quantity of a financial instrument or an amount of cash
based on the value of a securities index. Currently, futures contracts are
available on various types of fixed income securities, including but not limited
to U.S. Treasury bonds, notes and bills, Eurodollar certificates of deposit and
on indexes of fixed income securities and indexes of equity securities.

Unlike a futures contract, which requires the parties to buy and sell a
security or make a cash settlement payment based on changes in a financial
instrument or securities index on an agreed date, an option on a futures
contract entitles its holder to decide on or before a future date whether to
enter into such a contract. If the holder decides not to exercise its option,
the holder may close out the option position by entering into an offsetting
transaction or may decide to let the option expire and forfeit the premium
thereon. The purchaser of an option on a futures contract pays a premium for the
option but makes no initial margin payments or daily payments of cash in the
nature of "variation" margin payments to reflect the change in the value of the
underlying contract as does a purchaser or seller of a futures contract.

The seller of an option on a futures contract receives the premium paid
by the purchaser and may be required to pay initial margin. Amounts equal to the
initial margin and any additional collateral required on any options on futures
contracts sold by a Portfolio are paid by the Portfolio into a segregated
account, in the name of the Futures Commission Merchant, as required by the 1940
Act and the SEC's interpretations thereunder.

COMBINED POSITIONS. The Portfolios permitted to purchase and write
options may do so in combination with each other, or in combination with futures
or forward contracts, to adjust the risk and return characteristics of the
overall position. For example, a Portfolio may purchase a put option and write a
call

<PAGE>

option on the same underlying instrument, in order to construct a combined
position whose risk and return characteristics are similar to selling a futures
contract. Another possible combined position would involve writing a call option
at one strike price and buying a call option at a lower price, in order to
reduce the risk of the written call option in the event of a substantial price
increase. Because combined options positions involve multiple trades, they
result in higher transaction costs and may be more difficult to open and close
out.

CORRELATION OF PRICE CHANGES. Because there are a limited number of
types of exchange-traded options and futures contracts, it is likely that the
standardized options and futures contracts available will not match a
Portfolio's current or anticipated investments exactly. A Portfolio may invest
in options and futures contracts based on securities with different issuers,
maturities or other characteristics from the securities in which it typically
invests, which involves a risk that the options or futures position will not
track the performance of the Portfolio's other investments.

Options and futures contracts prices can also diverge from the prices
of their underlying instruments, even if the underlying instruments match the
Portfolio's investments well. Options and futures contracts prices are affected
by such factors as current and anticipated short-term interest rates, changes in
volatility of the underlying instrument, and the time remaining until expiration
of the contract, which may not affect security prices the same way. Imperfect
correlation may also result from differing levels of demand in the options and
futures markets and the securities markets, from structural differences in how
options and futures and securities are traded, or from imposition of daily price
fluctuation limits or trading halts. A Portfolio may purchase or sell options
and futures contracts with a greater or lesser value than the securities it
wishes to hedge or intends to purchase in order to attempt to compensate for
differences in volatility between the contract and the securities, although this
may not be successful in all cases. If price changes in a Portfolio's options or
futures positions are poorly correlated with its other investments, the
positions may fail to produce anticipated gains or result in losses that are not
offset by gains in other investments.

LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a
liquid market will exist for any particular option or futures contract at any
particular time even if the contract is traded on an exchange. In addition,
exchanges may establish daily price fluctuation limits for options and futures
contracts and may halt trading if a contract's price moves up or down more than
the limit in a given day. On volatile trading days when the price fluctuation
limit is reached or a trading halt is imposed, it may be impossible for a
Portfolio to enter into new positions or close out existing positions. If the
market for a contract is not liquid because of price fluctuation limits or
otherwise, it could prevent prompt liquidation of unfavorable positions and
could potentially require a Portfolio to continue to hold a position until
delivery or expiration regardless of changes in its value. As a result, the
Portfolio's access to other assets held to cover its options or futures
positions could also be impaired. (See "Exchange Traded and Over-the-Counter
Options" above for a discussion of the liquidity of options not traded on an
exchange.)

<PAGE>

POSITION LIMITS. Futures exchanges can limit the number of futures and
options on futures contracts that can be held or controlled by an entity. If an
adequate exemption cannot be obtained, a Portfolio or the Advisor may be
required to reduce the size of its futures and options positions or may not be
able to trade a certain futures or options contract in order to avoid exceeding
such limits.

ASSET COVERAGE FOR FUTURES CONTRACTS AND OPTIONS POSITIONS. The
Portfolios intend to comply with Section 4.5 of the regulations under the
Commodity Exchange Act, which limits the extent to which a Portfolio can commit
assets to initial margin deposits and option premiums. In addition, the
Portfolios will comply with guidelines established by the SEC with respect to
coverage of options and futures contracts by mutual funds, and if the guidelines
so require, will set aside appropriate liquid assets in a segregated custodial
account in the amount prescribed. Securities held in a segregated account cannot
be sold while the futures contract or option is outstanding, unless they are
replaced with other suitable assets. As a result, there is a possibility that
segregation of a large percentage of a Portfolio's assets could impede portfolio
management or the Portfolio's ability to meet redemption requests or other
current obligations.

RISK MANAGEMENT

The Non-U.S. Fixed Income, Emerging Markets Equity, Asia Growth,
European Equity and Japan Equity Portfolios may employ non-hedging risk
management techniques. Examples of such strategies include synthetically
altering the duration of a portfolio or the mix of securities in a portfolio.
For example, if the Advisor wishes to extend maturities in a fixed income
portfolio in order to take advantage of an anticipated decline in interest
rates, but does not wish to purchase the underlying long-term securities, it
might cause the Portfolio to purchase futures contracts on long-term debt
securities. Similarly, if the Advisor wishes to decrease fixed income securities
or purchase equities, it could cause the Portfolio to sell futures contracts on
debt securities and purchase futures contracts on a stock index. Such
non-hedging risk management techniques are not speculative, but because they
involve leverage include, as do all leveraged transactions, the possibility of
losses as well as gains that are greater than if these techniques involved the
purchase and sale of the securities themselves rather than their synthetic
derivatives.

PORTFOLIO TURNOVER

Set forth below are the portfolio turnover rates for the Portfolios
corresponding to the Funds. A rate of 100% indicates that the equivalent of all
of the Portfolio's assets have been sold and reinvested in a year. High
portfolio turnover may result in the realization of substantial net capital
gains or losses. To the extent net short term capital gains are realized, any
distributions resulting from such gains are considered ordinary income for
federal income tax purposes. See "Taxes" below.

THE SELECTED U.S. EQUITY PORTFOLIO (U.S. Equity Fund) -- For the period July 19,
1993 (commencement of operations) through May 31, 1994: 76%. For the fiscal year
ended May 31, 1995: 71%

<PAGE>

THE U.S. SMALL COMPANY PORTFOLIO (U.S. Small Cap Equity Fund) -- For the period
July 19, 1993 (commencement of operations) through May 31, 1994: 97%. For the
fiscal year ended May 31, 1995: 75%

INVESTMENT RESTRICTIONS

The investment restrictions below have been adopted by the Trust with
respect to each Fund and by each corresponding Portfolio. Except where otherwise
noted, these investment restrictions are "fundamental" policies which, under the
1940 Act, may not be changed without the vote of a majority of the outstanding
voting securities of the Fund or Portfolio, as the case may be. A "majority of
the outstanding voting securities" is defined in the 1940 Act as the lesser of
(a) 67% or more of the voting securities present at a meeting if the holders of
more than 50% of the outstanding voting securities are present or represented by
proxy, or (b) more than 50% of the outstanding voting securities. The percentage
limitations contained in the restrictions below apply at the time of the
purchase of securities. Whenever a Fund is requested to vote on a change in the
fundamental investment restrictions of its corresponding Portfolio, the Trust
will hold a meeting of Fund shareholders and will cast its votes as instructed
by the shareholders.

The investment restrictions of each Fund and its corresponding
Portfolio are identical, unless otherwise specified and except that each Fund
may invest all of its investable assets in another open-end management
investment company with the same investment objective, policies and restrictions
(such as the Fund's corresponding Portfolio). Accordingly, references below to a
Portfolio also include the Portfolio's corresponding Fund unless the context
requires otherwise.

The U.S. Fixed Income Portfolio may not:

1. Borrow money, except from banks for extraordinary or emergency purposes
and then only in amounts up to 30% of the value of the Portfolio's
total assets, taken at cost at the time of such borrowing and except in
connection with reverse repurchase agreements permitted by Investment
Restriction No. 8. Mortgage, pledge or hypothecate any assets except in
connection with any such borrowing in amounts up to 30% of the value of
the Portfolio's net assets at the time of such borrowing. The Portfolio
will not purchase securities while borrowings (including reverse
repurchase agreements) exceed 5% of the Portfolio's total assets. This
borrowing provision facilitates the orderly sale of portfolio
securities, for example, in the event of abnormally heavy redemption
requests. This provision is not for investment purposes. Collateral
arrangements for premium and margin payments in connection with the
Portfolio's hedging activities are not deemed to be a pledge of assets;

2. Purchase the securities or other obligations of any one issuer if,
immediately after such purchase, more than 5% of the value of the
Portfolio's total assets would be invested in securities or other
obligations of any one such issuer. This limitation shall not apply to
securities issued or guaranteed by the U.S. Government, its agencies or

<PAGE>

instrumentalities or to permitted investments of up to 25% of the
Portfolio's total assets;

3. Purchase the securities of an issuer if, immediately after such
purchase, the Portfolio owns more than 10% of the outstanding voting
securities of such issuer. This limitation shall not apply to permitted
investments of up to 25% of the Portfolio's total assets;

4. Purchase securities or other obligations of issuers conducting their
principal business activity in the same industry if, immediately after
such purchase the value of its investments in such industry would
exceed 25% of the value of the Portfolio's total assets. For purposes
of industry concentration, there is no percentage limitation with
respect to investments in U.S. Government securities;

5. Make loans, except through the purchase or holding of debt obligations
(including privately placed securities) or the entering into of
repurchase agreements, or loans of portfolio securities in accordance
with the Portfolio's investment objective and policies;

6. Purchase or sell puts, calls, straddles, spreads, or any combination
thereof, real estate, commodities, commodity contracts, except for the
Portfolio's interest in hedging activities as described under
"Investment Objectives and Policies"; or interests in oil, gas, or
mineral exploration or development programs. However, the Portfolio may
purchase debt obligations secured by interests in real estate or issued
by companies which invest in real estate or interests therein including
real estate investment trusts;

7. Purchase securities on margin, make short sales of securities, or
maintain a short position in securities, except in the course of the
Portfolio's hedging activities, unless at all times when a short
position is open the Portfolio owns an equal amount of such securities,
provided that this restriction shall not be deemed to be applicable to
the purchase or sale of when-issued securities or delayed delivery
securities;

8. Issue any senior security, except as appropriate to evidence
indebtedness which constitutes a senior security and which the
Portfolio is permitted to incur pursuant to Investment Restriction No.
1 and except that the Portfolio may enter into reverse repurchase
agreements, provided that the aggregate of senior securities, including
reverse repurchase agreements, shall not exceed one-third of the market
value of the Portfolio's total assets, less liabilities other than
obligations created by reverse repurchase agreements. The Portfolio's
arrangements in connection with its hedging activities as described in
"Investment Objectives and Policies" shall not be considered senior
securities for purposes hereof;

9. Acquire securities of other investment companies, except as permitted
by the 1940 Act; or

10. Act as an underwriter of securities.

<PAGE>

Each of the Selected U.S. Equity and U.S. Small Company Portfolios may
not:

1. Purchase the securities or other obligations of issuers conducting
their principal business activity in the same industry if, immediately
after such purchase the value of its investments in such industry would
exceed 25% of the value of the Portfolio's total assets. For purposes
of industry concentration, there is no percentage limitation with
respect to investments in U.S. Government securities;

2. Borrow money, except from banks for extraordinary or emergency purposes
and then only in amounts not to exceed 10% of the value of the
Portfolio's total assets, taken at cost, at the time of such borrowing.
Mortgage, pledge or hypothecate any assets except in connection with
any such borrowing and in amounts not to exceed 10% of the value of the
Portfolio's net assets at the time of such borrowing. The Portfolio
will not purchase securities while borrowings exceed 5% of the
Portfolio's total assets. This borrowing provision is included to
facilitate the orderly sale of portfolio securities, for example, in
the event of abnormally heavy redemption requests, and is not for
investment purposes. Collateral arrangements for premium and margin
payments in connection with the Portfolio's hedging activities are not
deemed to be a pledge of assets;

3. Purchase the securities or other obligations of any one issuer if,
immediately after such purchase, more than 5% of the value of the
Portfolio's total assets would be invested in securities or other
obligations of any one such issuer. This limitation shall not apply to
issues of the U.S. Government, its agencies or instrumentalities or to
permitted investments of up to 25% of the Portfolio's total assets;

4. Purchase the securities of an issuer if, immediately after such
purchase, the Portfolio owns more than 10% of the outstanding voting
securities of such issuer. This limitation shall not apply to permitted
investments of up to 25% of the Portfolio's total assets;

5. Make loans, except through the purchase or holding of debt obligations
(including privately placed securities), or the entering into of
repurchase agreements, or loans of portfolio securities in accordance
with the Portfolio's investment objective and policies (see "Investment
Objectives and Policies");

6. Purchase or sell puts, calls, straddles, spreads, or any combination
thereof, real estate, commodities, or commodity contracts, except for
the Portfolio's interests in hedging activities as described under
"Investment Objectives and Policies"; or interests in oil, gas, or
mineral exploration or development programs. However, the Portfolio may
purchase securities or commercial paper issued by companies which
invest in real estate or interests therein, including real estate
investment trusts;

7. Purchase securities on margin, make short sales of securities, or
maintain a short position, except in the course of the Portfolio's
hedging activities, provided that this restriction shall not be deemed
to be

<PAGE>

applicable to the purchase or sale of when-issued securities or delayed
delivery securities;

8. Acquire securities of other investment companies, except as permitted
by the 1940 Act;

9. Act as an underwriter of securities;

10. Issue any senior security, except as appropriate to evidence
indebtedness which the Portfolio is permitted to incur pursuant to
Investment Restriction No. 2. The Portfolio's arrangements in
connection with its hedging activities as described in "Investment
Objectives and Policies" shall not be considered senior securities for
purposes hereof; or

11. Purchase any equity security if, as a result, the Portfolio would then
have more than 5% of its total assets invested in securities of
companies (including predecessors) that have been in continuous
operation for fewer than three years.

The Non-U.S. Equity Portfolio may not:

1. Borrow money, except from banks for extraordinary or emergency purposes
and then only in amounts up to 30% of the value of the Portfolio's net
assets at the time of borrowing, and except in connection with reverse
repurchase agreements and then only in amounts up to 33 1/3% of the
value of the Portfolio's net assets; or purchase securities while
borrowings, including reverse repurchase agreements, exceed 5% of the
Portfolio's total assets. The Portfolio will not mortgage, pledge or
hypothecate any assets except in connection with any such borrowing and
in amounts not to exceed 30% of the value of the Portfolio's net assets
at the time of such borrowing;

4. Purchase the securities or other obligations of issuers conducting
their principal business activity in the same industry if, immediately
after such purchase, the value of its investments in such industry
would exceed 25% of the value of the Portfolio's total assets. For
purposes of industry concentration, there is no percentage limitation
with respect to investments in U.S. Government securities;

<PAGE>

5. Make loans, except through the purchase or holding of debt obligations
(including restricted securities), or the entering into of repurchase
agreements, or loans of portfolio securities in accordance with the
Portfolio's investment objective and policies, see "Risk Factors and
Additional Investment Information" in the Prospectus and "Investment
Objectives and Policies" in this Statement of Additional Information;

6. Purchase or sell puts, calls, straddles, spreads, or any combination
thereof, real property, including limited partnership interests,
commodities, or commodity contracts, except for the Portfolio's
interests in hedging and foreign exchange activities as described under
"Risk Factors and Additional Investment Information" in the Prospectus;
or interests in oil, gas, mineral or other exploration or development
programs or leases. However, the Portfolio may purchase securities or
commercial paper issued by companies that invest in real estate or
interests therein including real estate investment trusts;

7. Purchase securities on margin, make short sales of securities, or
maintain a short position in securities, except to obtain such
short-term credit as necessary for the clearance of purchases and sales
of securities, provided that this restriction shall not be deemed to
apply to the purchase or sale of when-issued securities or delayed
delivery securities;

8. Acquire securities of other investment companies, except as permitted
by the 1940 Act;

9. Act as an underwriter of securities, except insofar as the Portfolio
may be deemed to be an underwriter under the 1933 Act by virtue of
disposing of portfolio securities; or

10. Issue any senior security, except as appropriate to evidence
indebtedness which the Portfolio is permitted to incur pursuant to
Investment Restriction No. 1. The Portfolio's arrangements in
connection with its hedging activities as described in "Risk Factors
and Additional Investment Information" in the Prospectus shall not be
considered senior securities for purposes hereof.

Unless Sections 8(b)(1) and 13(a) of the 1940 Act or any SEC or SEC
staff interpretations thereof are amended or modified, each of the Emerging
Markets Equity, Asia Growth and European Equity Portfolios may not:

1. Purchase any security if, as a result, more than 25% of the value of
the Portfolio's total assets would be invested in securities of issuers
having their principal business activities in the same industry. This
limitation shall not apply to obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities;

2. Borrow money, except that the Portfolio may (i) borrow money from banks
for temporary or emergency purposes (not for leveraging purposes) and
(ii) enter into reverse repurchase agreements for any purpose; provided
that (i) and (ii) in total do not exceed 33 1/3% of the value of the
Portfolio's total assets (including the amount borrowed) less
liabilities

<PAGE>

(other than borrowings). If at any time any borrowings come to exceed
33 1/3% of the value of the Portfolio's total assets, the Portfolio
will reduce its borrowings within three business days to the extent
necessary to comply with the 33 1/3% limitation;

3. With respect to 75% of its total assets, purchase any security if, as a
result, (a) more than 5% of the value of the Portfolio's total assets
would be invested in securities or other obligations of any one issuer;
or (b) the Portfolio would hold more than 10% of the outstanding voting
securities of that issuer. This limitation shall not apply to
Government securities (as defined in the 1940 Act);

4. Make loans to other persons, except through the purchase of debt
obligations, loans of portfolio securities and participation in
repurchase agreements;

5. Purchase or sell physical commodities or contracts thereon, unless
acquired as a result of the ownership of securities or instruments, but
the Portfolio may purchase or sell futures contracts or options
(including options on futures contracts, but excluding options or
futures contracts on physical commodities) and may enter into foreign
currency forward contracts;

6. Purchase or sell real estate, but the Portfolio may purchase or sell
securities that are secured by real estate or issued by companies
(including real estate investment trusts) that invest or deal in real
estate;

7. Underwrite securities of other issuers, except to the extent the
Portfolio, in disposing of portfolio securities, may be deemed an
underwriter within the meaning of the 1933 Act; or

8. Issue senior securities, except as permitted under the 1940 Act or any
rule, order or interpretation thereunder.

Unless Sections 8(b)(1) and 13(a) of the 1940 Act or any SEC or SEC
staff interpretations thereof are amended or modified, each of the Non-U.S.
Fixed Income and Japan Equity Portfolios may not:

<PAGE>

reduce its borrowings within three business days to the extent
necessary to comply with the 33 1/3% limitation;

3. Make loans to other persons, except through the purchase of debt
obligations, loans of portfolio securities and participation in
repurchase agreements;

4. Purchase or sell physical commodities or contracts thereon, unless
acquired as a result of the ownership of securities or instruments, but
the Portfolio may purchase or sell futures contracts or options
(including options on futures contracts, but excluding options or
futures contracts on physical commodities) and may enter into foreign
currency forward contracts;

5. Purchase or sell real estate, but the Portfolio may purchase or sell
securities that are secured by real estate or issued by companies
(including real estate investment trusts) that invest or deal in real
estate;

6. Underwrite securities of other issuers, except to the extent the
Portfolio, in disposing of portfolio securities, may be deemed an
underwriter within the meaning of the 1933 Act; or

7. Issue senior securities, except as permitted under the 1940 Act or any
rule, order or interpretation thereunder.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - ALL PORTFOLIOS. The
investment restriction described below is not a fundamental policy of each
Portfolio and may be changed by the Portfolio's Trustees. This non-fundamental
investment policy requires that each Portfolio may not:

(i) acquire any illiquid securities, such as repurchase agreements with
more than seven days to maturity or fixed time deposits with a duration of over
seven calendar days, if as a result thereof, more than 15% of the market value
of the Portfolio's total assets would be in investments that are illiquid.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - NON-U.S. EQUITY PORTFOLIO.
The investment restrictions described below are not fundamental policies of the
Non- U.S. Equity Portfolio and may be changed by the Portfolio's Trustees. These
non-fundamental investment policies require that the Portfolio may not:

(i) purchase any equity security if, as a result, the Portfolio would
then have more than 5% of its total assets invested in securities of companies
(including predecessors) that have been in continuous operation for fewer than
three years;

(ii) invest in warrants (other than warrants acquired by the Portfolio
as part of a unit or attached to securities at the time of purchase) if, as a
result, the investments (valued at the lower of cost or market) would exceed 5%
of the value of the Portfolio's net assets or if, as a result, more than 2% of
the Portfolio's net assets would be invested in warrants not listed on a

<PAGE>

recognized U.S. or foreign stock exchange, to the extent permitted by applicable
state securities laws; or

(iii) invest in any securities issued by an issuer any of whose
officers, directors, trustees or security holders is an officer or Trustee of
the Portfolio, or is an officer of the Advisor, if after the Portfolio's
purchase of the securities of such issuer, one or more of such persons owns
beneficially more than 1/2 of 1% of the shares or securities, or both, all taken
at market value, of such issuer, and such persons owning more than 1/2 of 1% of
such shares or securities together own beneficially more than 5% of such shares
or securities, or both, all taken at market value.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - SELECTED U.S. EQUITY AND U.S.
SMALL COMPANY PORTFOLIOS. The investment restrictions described below are not
fundamental policies of these Portfolios and may be changed by the Portfolios'
Trustees. These non-fundamental investment policies require that each of these
Portfolios may not:

(i) invest in warrants (other than warrants acquired by the Portfolio
as part of a unit or attached to securities at the time of purchase) if, as a
result, the investments (valued at the lower of cost or market) would exceed 5%
of the value of the Portfolio's net assets or if, as a result, more than 2% of
the Portfolio's net assets would be invested in warrants not listed on a
recognized U.S. or foreign stock exchange, to the extent permitted by applicable
state securities laws;

(ii) invest in any securities issued by an issuer any of whose
officers, directors, trustees or security holders is an officer or Trustee of
the Portfolio, or is an officer of the Advisor, if after the Portfolio's
purchase of the securities of such issuer, one or more of such persons owns
beneficially more than 1/2 of 1% of the shares or securities, or both, all taken
at market value, of such issuer, and such persons owning more than 1/2 of 1% of
such shares or securities together own beneficially more than 5% of such shares
or securities, or both, all taken at market value;

(iii) invest in real estate limited partnership interests; or

(iv) invest in oil, gas or other mineral leases.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - EMERGING MARKETS EQUITY, ASIA
GROWTH AND EUROPEAN EQUITY PORTFOLIOS. The investment restrictions described
below are not fundamental policies of these Portfolios and may be changed by the
Portfolios' Trustees. These non-fundamental investment policies require that
each of these Portfolios may not:

(i) Acquire securities of other investment companies, except as
permitted by the 1940 Act or any rule, order or interpretation thereunder, or in
connection with a merger, consolidation, reorganization, acquisition of assets
or an offer of exchange;

<PAGE>

(ii) Purchase any security if, as a result, the Portfolio would then
have more than 5% of its total assets invested in securities of companies
(including predecessors) that have been in continuous operation for fewer than
three years;

(iii) Invest in warrants (other than warrants acquired by the Portfolio
as part of a unit or attached to securities at the time of purchase) if, as a
result, the investments (valued at the lower of cost or market) would exceed 5%
of the value of the Portfolio's net assets or if, as a result, more than 2% of
the Portfolio's net assets would be invested in warrants not listed on a
recognized U.S. or foreign stock exchange, to the extent permitted by applicable
state securities laws;

(iv) Sell any security short, unless it owns or has the right to obtain
securities equivalent in kind and amount to the securities sold or unless it
covers such short sales as required by the current rules or positions of the SEC
or its staff. Transactions in futures contracts and options shall not constitute
selling securities short;

(v) Purchase securities on margin, but the Portfolio may obtain such
short term credits as may be necessary for the clearance of transactions;

(vi) Purchase or retain securities of any issuer if, to the knowledge
of the Portfolio, any of the Portfolio's officers or Trustees or any officer of
the Advisor individually owns more than 1/2 of 1% of the issuer's outstanding
securities and such persons owning more than 1/2 of 1% of such securities
together beneficially own more than 5% of such securities, all taken at market;
or

(vii) Invest in real estate limited partnerships or purchase interests
in oil, gas or mineral exploration or development programs or leases.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - JAPAN EQUITY PORTFOLIO. The
investment restrictions described below are not fundamental policies of the
Japan Equity Portfolio and may be changed by the Portfolio's Trustees. These
non- fundamental investment policies require that the Portfolio may not:

(iii) Sell any security short, unless it owns or has the right to
obtain securities equivalent in kind and amount to the securities sold or unless
it covers such short sales as required by the current rules or positions of the
SEC or its staff. Transactions in futures contracts and options shall not
constitute selling securities short;

<PAGE>

(iv) Purchase securities on margin, but the Portfolio may obtain such
short term credits as may be necessary for the clearance of transactions;

(v) Purchase or retain securities of any issuer if, to the knowledge of
the Portfolio, any of the Portfolio's officers or Trustees or any officer of the
Advisor individually owns more than 1/2 of 1% of the issuer's outstanding
securities and such persons owning more than 1/2 of 1% of such securities
together beneficially own more than 5% of such securities, all taken at market;
or

(vi) Invest in real estate limited partnerships or purchase interests
in oil, gas or mineral exploration or development programs or leases.

NON-FUNDAMENTAL INVESTMENT RESTRICTIONS - NON-U.S. FIXED INCOME
PORTFOLIO. The investment restrictions described below are not fundamental
policies of the Non-U.S. Fixed Income Portfolio and may be changed by the
Portfolio's Trustees. These non-fundamental investment policies require that the
Portfolio may not:

(iv) Purchase or retain securities of any issuer if, to the knowledge
of the Portfolio, any of the Portfolio's officers or Trustees or any officer of
the Advisor individually owns more than 1/2 of 1% of the issuer's outstanding
securities and such persons owning more than 1/2 of 1% of such securities
together beneficially own more than 5% of such securities, all taken at market;

(v) Purchase securities on margin, but the Portfolio may obtain such
short term credits as may be necessary for the clearance of transactions; or

(vi) Invest in real estate limited partnerships or purchase interests
in oil, gas or mineral exploration or development programs or leases.

ALL PORTFOLIOS. There will be no violation of any investment
restriction if that restriction is complied with at the time the relevant action
is taken notwithstanding a later change in market value of an investment, in net
or total assets, in the securities rating of the investment or any other later
change.

<PAGE>

TRUSTEES AND OFFICERS

The Trustees of the Trust and the Trustees of the Portfolios, their
business addresses and their principal occupations during the past five years
are set forth below. An asterisk indicates that a Trustee is an "interested
person" (as defined in the 1940 Act) of the Trust or the Portfolios, as the case
may be.

TRUSTEES OF THE TRUST

JOHN C. COX*--Trustee; Nomura Professor of Finance, Massachusetts
Institute of Technology (since 1983); Director, Asset Specialization Corporation
(since May, 1992); Director, Nomura Asset Securities Corporation (since May,
1992); Fellow, Econometric Society (since December, 1990); Director, Nomura
Mortgage Capital Corporation (since 1989); Director, American Finance
Association (prior to 1993); Consultant J.P. Morgan Investment Management Inc.
("J.P. Morgan") (since 1985). His address is 15 Stony Brook Road, Weston,
Massachusetts 02193.

JOYCE NELSON--Trustee; Vice President and Director-Investments,
International Paper Company (since March, 1993); Treasurer, The Times Mirror
Company (prior to March, 1993); Vicechair-Investment Committee, Committee on
Investment of Employee Benefit Assets (since November, 1993); Trustee and
Chairman of Investment Committee, Hartford Courant Foundation (prior to March,
1993); Investment Advisory Committee Member, Newspaper Association of America
(prior to 1993); Trustee, Alvin Ailey Dance Theater Foundation (since October,
1992). Her address is c/o International Paper Company, Two Manhattanville Road,
Purchase, New York 10577.

JOHN R. RETTBERG--Trustee; retired; Consultant, Northrop Grumman
Corporation ("Northrop") (since January, 1995); Corporate Vice President and
Treasurer, Northrop (prior to January, 1995); Director, Independent Colleges of
Southern California (prior to 1994); Director, Junior Achievement (prior to
1993). His address is 79-165 Montego Bay Drive, Bermuda Dunes, California 92201.

JOHN F. RUFFLE*--Trustee; retired; Consultant, J.P. Morgan (since June,
1993); Director and Vice Chairman of J.P. Morgan (prior to June, 1993);
Director, Trident Corporation (since April, 1994); Director, Bethlehem Steel
Corporation (since September, 1990); Trustee, Johns Hopkins University (since
April, 1990); Trustee, Overlook Hospital Foundation (since April, 1990);
Director, Student Loan Marketing Association (since April, 1990). His address is
34 Wynwood Road, Chatham, New Jersey 07928-1731.

KENNETH WHIPPLE, JR.--Trustee; Executive Vice President, Ford Motor
Company, President, Ford Financial Services Group, and Director, Ford Motor
Credit Company (since 1988); Director and President, Ford Holdings, Inc. (since
1989); Director, CMS Energy Corporation and Consumers Power Company (since
January, 1993); Director, Detroit Country Day School (since January, 1993);
Director Granite Management Corporation (formerly First Nationwide Financial
Corporation) and Granite Savings Bank (formerly First Nationwide Bank) (since
1988); Director, United Way of Southeastern Michigan (since 1988); Director, USL
Capital Corporation (since 1988); Chairman, Director and First Vice President,
WTVS-TV (since 1988). His address is 1115 Country Club Drive, Bloomfield Hills,
Michigan 48304.

<PAGE>

Each Trustee of the Trust is paid a $16,000 annual fee for serving as
Trustee of the Trust and is reimbursed for expenses incurred in connection with
service as a Trustee. The Trustees may hold various other directorships
unrelated to the Trust. The Trustees of the Trust, in addition to reviewing
actions of the Trust's various service providers, decide upon matters of general
policy.

TRUSTEES OF THE PORTFOLIOS

FREDERICK S. ADDY--Trustee; Retired; Executive Vice President and Chief
Financial Officer from January 1990 to April 1994 and Vice President, Finance,
from 1983 to January 1990, Amoco Corporation; Director, Ensearch Corp. (natural
gas), since 1994. His address is 19129 RR 2147 W. Horseshoe Bay, Texas 78654.

WILLIAM G. BURNS--Trustee; Retired; Limited Partner, Galen Partners
L.P. and Vice Chairman, Galen Associates, since 1990; Chief Executive Officer,
Galen Associates and General Partner, Galen Partners L.P., until 1991. His
address is 4241 S.W. Parkgate Blvd., Palm City, Florida 34990.

ARTHUR C. ESCHENLAUER--Trustee; Retired; Senior Vice President, Morgan
Guaranty Trust Company of New York until 1987. His address is 14 Alta Vista
Drive, RD #2, Princeton, New Jersey 08540.

MATTHEW HEALEY*--Trustee and Chairman of the Board of Trustees;
Chairman, Pierpont Group, Inc., since 1989; Chairman and Chief Executive
Officer, Execution Services, Inc. until October 1991. His address is Pine Tree
Club Estates, 10286 Saint Andrew Road, Boynton Beach, Florida 33436.

MICHAEL P. MALLARDI--Trustee; Senior Vice President, Capital
Cities/ABC, Inc., President, Broadcast Group, since 1986. His address is 77 West
66th Street, New York, New York 10017.

Each Trustee is paid an annual fee as follows for serving as Trustee of
The Pierpont Funds, The JPM Institutional Funds, the other portfolios in which
these funds invest, and the Portfolios, and is reimbursed for any expenses
incurred in connection with service as a Trustee. The Trustees may hold various
other directorships unrelated to the Portfolios.
<TABLE>
<CAPTION>

PENSION OR
AGGREGATE RETIREMENT TOTAL COMPENSATION FROM
COMPENSATION BENEFITS ESTIMATED THE TRUST AND FUND
FROM THE TRUST ACCRUED AS PART ANNUAL BENEFITS COMPLEX PAID TO TRUSTEES
DURING 1994 OF FUND EXPENSES UPON RETIREMENT DURING 1994
----------- ---------------- --------------- -----------
<S> <C> <C> <C> <C>

Frederick S. Addy, Trustee N/A None None $55,000

William G. Burns, Trustee N/A None None $55,000

Arthur C. Eschenlauer, Trustee N/A None None $55,000

Matthew Healey, Trustee, N/A None None $55,000
Chairman and Chief Executive
Officer (*)

Michael P. Mallardi, Trustee N/A None None $55,000
</TABLE>

- ------------------------------------
(*) During 1994, Pierpont Group, Inc. paid Mr. Healey, in his role as Chairman
of Pierpont Group, Inc., compensation in the amount of $130,000, contributed
$19,500 to a defined contribution plan on his behalf, and paid $20,000 in
insurance premiums for his benefit.

As of April 1, 1995 the annual fee paid to each Trustee for serving as
a Trustee of each of the Portfolios, The Series Portfolio, The JPM Institutional
Funds and The Pierpont Funds was adjusted to $65,000.

The Trustees, in addition to reviewing actions of the Portfolios'
various service providers, decide upon matters of general policy. On January 15,
1994, each of the Portfolios entered into a Fund Services Agreement with
Pierpont Group, Inc. to assist the Trustees in exercising their overall
supervisory responsibilities over the affairs of the Portfolios. Pierpont Group,
Inc. was organized in July 1989 to provide services for The Pierpont Family of
Funds, and the Trustees of the Portfolios are the shareholders of Pierpont
Group, Inc. The Portfolios have agreed to pay Pierpont Group, Inc. a fee in an
amount representing its reasonable costs in performing these services. These
costs are periodically reviewed by the Portfolios' Trustees. The aggregate fees
paid by each Portfolio during its last fiscal year completed after January 15,
1994 are set forth below:

U.S. FIXED INCOME PORTFOLIO--For the fiscal year ended October 31, 1994: $23,028

SELECTED U.S. EQUITY PORTFOLIO--For the fiscal year ended May 31, 1994: $20,385.
For the fiscal year ended May 31, 1995: $52,948.

U.S. SMALL COMPANY PORTFOLIO--For the fiscal year ended May 31, 1994: $33,435.
For the fiscal year ended May 31, 1995: $62,256.

NON-U.S. EQUITY PORTFOLIO--For the fiscal year ended October 31, 1994: $32,512

EMERGING MARKETS EQUITY PORTFOLIO--For the fiscal year ended October 31, 1994:
$42,764

As of the date of this Statement of Additional Information, the Asia
Growth, European Equity and Japan Equity Portfolios had not commenced investment
operations, and the Non-U.S. Fixed Income Portfolio had not completed its
initial fiscal year.

OFFICERS

The Trust's and Portfolios' executive officers (listed below), other than the
Chief Executive Officer of the Portfolios, are provided and compensated by
Signature Broker-Dealer Services, Inc. ("SBDS"), a wholly owned subsidiary of
Signature Financial Group, Inc. ("Signature"). The officers conduct and
supervise the business operations of the Trust and the Portfolios. The Trust and
the Portfolios have no employees.

<PAGE>

The officers of the Trust and the Portfolios and their principal
occupations during the past five years are set forth below. Unless otherwise
specified, each officer holds the same position with the Trust and each
Portfolio. The business address of each of the officers unless otherwise noted
is Signature Broker-Dealer Services, Inc., 6 St. James Avenue, Boston,
Massachusetts 02116.

MATTHEW HEALEY; Chief Executive Officer; Chairman, Pierpont Group,
Inc., since 1989; Chairman and Chief Executive Officer, Execution Services, Inc.
until October 1991. His address is Pine Tree Club Estates, 10286 Saint Andrew
Road, Boynton Beach, FL 33436.

PHILIP W. COOLIDGE; President; Chairman, Chief Executive Officer and
President, Signature since December 1988 and SBDS since April 1989.

DAVID G. DANIELSON; Assistant Treasurer; Assistant Manager, Signature
since May 1991; Graduate Student, Northeastern University from April 1990 to
March 1991.

LINDA T. GIBSON; Assistant Secretary; Legal Counsel and Assistant
Secretary, Signature since June 1991; Assistant Secretary, SBDS since November
1992; law student, Boston University School of Law prior to May 1992.

JAMES E. HOOLAHAN; Vice President; Senior Vice President, Signature since
December 1989.

SUSAN JAKUBOSKI; Assistant Secretary and Assistant Treasurer of the
Portfolios only; Manager and Senior Fund Administrator, SFG and Signature
(Cayman) (since August 1994); Assistant Treasurer, SBDS (since September 1994);
Fund Compliance Administrator, Concord Financial Group, Inc. (from November 1990
to August 1994); Senior Fund Accountant, Neuberger & Berman Management
Incorporated (since prior to 1990). Her address is P.O. Box 2494, Elizabethan
Square, George Town, Grand Cayman, Cayman Islands, B.W.I.

JAMES S. LELKO; Assistant Treasurer; Assistant Manager, Signature since January
1993; Senior Tax Compliance Accountant, Putnam Companies since prior to December
1992.

THOMAS M. LENZ; Assistant Secretary; Vice President and Associate General
Counsel, Signature since November 1989; Assistant Secretary, SBDS since February
1991.

MOLLY S. MUGLER; Assistant Secretary; Legal Counsel and Assistant
Secretary, Signature since December 1988; Assistant Secretary, SBDS since April
1989.

ANDRES E. SALDANA; Assistant Secretary; Legal Counsel and Assistant
Secretary, Signature since November 1992; Assistant Secretary, SBDS since
September 1993; Attorney, Ropes & Gray from September 1990 to November 1992.

<PAGE>

DANIEL E. SHEA; Assistant Treasurer; Assistant Manager of Fund
Administration, Signature since November 1993; Supervisor and Senior Technical
Advisor, Putnam Investments since prior to 1990.

Messrs. Coolidge, Danielson, Hoolahan, Lelko, Lenz, Saldana and Shea
and Mss. Gibson, Mugler and Jakuboski hold similar positions for other
investment companies for which SBDS or an affiliate serves as principal
underwriter.

INVESTMENT ADVISOR

The investment advisor to the Portfolios is Morgan Guaranty Trust
Company of New York, a wholly owned subsidiary of J.P. Morgan & Co. Incorporated
("J.P. Morgan"), a bank holding company organized under the laws of the State of
Delaware. Morgan, whose principal offices are at 60 Wall Street, New York, New
York 10260, is a New York trust company which conducts a general banking and
trust business. Morgan is subject to regulation by the New York State Banking
Department and is a member bank of the Federal Reserve System. Through offices
in New York City and abroad, Morgan offers a wide range of services, primarily
to governmental, institutional, corporate and high net worth individual
customers in the United States and throughout the world.

J.P. Morgan, through the Advisor and other subsidiaries, acts as
investment advisor to individuals, governments, corporations, employee benefit
plans, mutual funds and other institutional investors with combined assets under
management of approximately $150 billion (of which the Advisor advises over $30
billion).

J.P. Morgan has a long history of service as adviser, underwriter and
lender to an extensive roster of major companies and as a financial advisor to
national governments. The firm, through its predecessor firms, has been in
business for over a century and has been managing investments since 1913.

The basis of Morgan's investment process is fundamental investment
research as the firm believes that fundamentals should determine an asset's
value over the long term. J.P. Morgan currently employs over 100 full time
research analysts, among the largest research staffs in the money management
industry, in its investment management divisions located in New York, London,
Tokyo, Frankfurt, Melbourne and Singapore to cover companies, industries and
countries on site. In addition, the investment management divisions employ
approximately 300 capital market researchers, portfolio managers and traders.
The conclusions of the equity analysts' fundamental research is quantified into
a set of projected returns for individual companies through the use of a
dividend discount model. These returns are projected for 2 to 5 years to enable
analysts to take a longer term view. These returns, or normalized earnings, are
used to establish relative values among stocks in each industrial sector. These
values may not be the same as the markets' current valuations of these
companies. This provides the basis for ranking the attractiveness of the
companies in an industry according to five distinct quintiles or rankings. This
ranking is one of the factors considered in determining the stocks purchased and
sold in each sector. The Advisor's fixed income investment process is based on
analysis of real rates, sector diversification and quantitative and credit
analysis.

<PAGE>

The investment advisory services the Advisor provides to the Portfolios
are not exclusive under the terms of the Advisory Agreements. The Advisor is
free to and does render similar investment advisory services to others. The
Advisor serves as investment advisor to personal investors and other investment
companies and acts as fiduciary for trusts, estates and employee benefit plans.
Certain of the assets of trusts and estates under management are invested in
common trust funds for which the Advisor serves as trustee. The accounts which
are managed or advised by the Advisor have varying investment objectives and the
Advisor invests assets of such accounts in investments substantially similar to,
or the same as, those which are expected to constitute the principal investments
of the Portfolios. Such accounts are supervised by officers and employees of the
Advisor who may also be acting in similar capacities for the Portfolios. See
"Portfolio Transactions."

Sector weightings are generally similar to a fund's benchmark with the
emphasis on security selection as the method to achieve investment performance
superior to the benchmark. The benchmarks for the Portfolios in which the Funds
invest are currently: The U.S. Fixed Income Portfolio--Salomon Brothers Broad
Investment Grade Bond Index; The Selected U.S. Equity Portfolio--S&P 500 Index;
The U.S. Small Company Portfolio--Russell 2500 Index; The Non-U.S. Equity
Portfolio--EAFE Index; The Emerging Markets Equity Portfolio--IFC Emerging
Markets Index; The European Equity Portfolio--the MSCI Europe Index; The Japan
Equity Portfolio--the TOPIX; and The Asia Growth Portfolio--the MSCI indexes for
Hong Kong and Singapore and the International Finance Corporation Investable
indexes for China, Indonesia, Malaysia, Philippines, South Korea, Taiwan and
Thailand.

J.P. Morgan Investment Management Inc., a wholly-owned subsidiary of
J.P. Morgan, is a registered investment adviser under the Investment Advisers
Act of 1940, as amended, which manages employee benefit funds of corporations,
labor unions and state and local governments and the accounts of other
institutional investors, including investment companies. Certain of the assets
of employee benefit accounts under its management are invested in commingled
pension trust funds for which the Advisor serves as trustee. J.P. Morgan
Investment Management Inc. advises the Advisor on investment of the commingled
pension trust funds.

The Portfolios are managed by officers of the Advisor who, in acting
for their customers, including the Portfolios, do not discuss their investment
decisions with any personnel of J.P. Morgan or any personnel of other divisions
of the Advisor or with any of its affiliated persons, with the exception of J.P.
Morgan Investment Management Inc. See "Portfolio Transactions" below for a
description of services provided to the Portfolios by J.P. Morgan Investment
Management Inc.

As compensation for the services rendered and related expenses such as
salaries of advisory personnel borne by the Advisor under the Advisory
Agreements, the Portfolio corresponding to each Fund has agreed to pay the
Advisor a fee, which is computed daily and may be paid monthly, equal to the
annual rates of each Portfolio's average daily net assets shown below.

<PAGE>

PORTFOLIO FEE RATE

U.S. FIXED INCOME 0.30%

NON-U.S. FIXED INCOME 0.35%

SELECTED U.S. EQUITY 0.40%

U.S. SMALL COMPANY 0.60%

NON-U.S. EQUITY 0.60%

EMERGING MARKETS EQUITY 1.00%

ASIA GROWTH 0.80%

EUROPEAN EQUITY 0.65%

JAPAN EQUITY 0.65%

The table below sets forth for each Fund listed the advisory fees paid
by its corresponding Portfolio to the Advisor for the fiscal periods indicated.
See "Expenses" in the Prospectus and below for applicable expense limitations.

U.S. FIXED INCOME PORTFOLIO (U.S. FIXED INCOME FUND)--For the period July 12,
1993 (commencement of operations) through October 31, 1993: $119,488. For the
fiscal year ended October 31, 1994: $699,081.

SELECTED U.S. EQUITY PORTFOLIO (U.S. EQUITY FUND)--For the period July 19, 1993
(commencement of operations) through May 31, 1994: $1,263,048. For the fiscal
year ended May 31, 1995: $2,025,936.

U.S. SMALL COMPANY PORTFOLIO (U.S. SMALL CAP EQUITY FUND)--For the period July
19, 1993 (commencement of operations) through May 31, 1994: $2,912,670. For the
fiscal year ended May 31, 1995: $3,514,331.

NON-U.S. EQUITY PORTFOLIO (INTERNATIONAL EQUITY FUND)--For the period October 4,
1993 (commencement of operations) through October 31, 1993: $78,550. For the
fiscal year ended October 31, 1994: $1,911,202.

EMERGING MARKETS EQUITY PORTFOLIO (EMERGING MARKETS EQUITY FUND)--For the period
November 15, 1993 (commencement of operations) through October 31, 1994:
$4,122,465.

As of the date of this Statement of Additional Information, the Asia
Growth, European Equity, Japan Equity Portfolios and the Non-U.S. Fixed Income
Portfolio had not completed its initial fiscal year.

The Investment Advisory Agreements provide that they will continue in
effect for a period of two years after execution only if specifically approved
thereafter annually in the same manner as the Distribution Agreement. See
"Administrator and Distributor" below. Each of the Investment Advisory

<PAGE>

Agreements will terminate automatically if assigned and is terminable at any
time without penalty by a vote of a majority of the Portfolio's Trustees, or by
a vote of the holders of a majority of the Portfolio's outstanding voting
securities, on 60 days' written notice to the Advisor and by the Advisor on 90
days' written notice to the Portfolio. See "Additional Information."

The Glass-Steagall Act and other applicable laws generally prohibit
banks such as Morgan from engaging in the business of underwriting or
distributing securities, and the Board of Governors of the Federal Reserve
System has issued an interpretation to the effect that under these laws a bank
holding company registered under the federal Bank Holding Company Act or certain
subsidiaries thereof may not sponsor, organize or control a registered open-end
investment company continuously engaged in the issuance of its shares, such as
the Trust. The interpretation does not prohibit a holding company or a
subsidiary thereof from acting as investment advisor and custodian to such an
investment company. Morgan believes that it may perform the services for the
Portfolios contemplated by the Advisory Agreements without violation of the
Glass-Steagall Act or other applicable banking laws or regulations. State laws
on this issue may differ from the interpretation of relevant federal law, and
banks and financial institutions may be required to register as dealers pursuant
to state securities laws. However, it is possible that future changes in either
federal or state statutes and regulations concerning the permissible activities
of banks or trust companies, as well as further judicial or administrative
decisions and interpretations of present and future statutes and regulations,
might prevent Morgan from continuing to perform such services for the
Portfolios.

If Morgan were prohibited from acting as investment advisor to any
Portfolio, it is expected that the Trustees of the Portfolio would recommend to
investors that they approve the Portfolio's entering into a new investment
advisory agreement with another qualified investment advisor selected by the
Trustees.

Morgan also receives compensation from the Trust and the Portfolios in
its capacity as Services Agent to them (see "Services Agent").

ADMINISTRATOR AND DISTRIBUTOR

SBDS serves as the Trust's exclusive Distributor and holds itself
available to receive purchase orders for each of the Fund's shares. In that
capacity, SBDS has been granted the right, as agent of the Trust, to solicit and
accept orders for the purchase of each of the Fund's shares in accordance with
the terms of the Distribution Agreement between the Trust and SBDS. The
Distribution Agreement shall continue in effect with respect to each of the
Funds for a period of two years after execution only if it is approved at least
annually thereafter (i) by a vote of the holders of a majority of the Fund's
outstanding shares or by its Trustees and (ii) by a vote of a majority of the
Trustees of the Trust who are not "interested persons" (as defined by the 1940
Act) of the parties to the Distribution Agreement, cast in person at a meeting
called for the purpose of voting on such approval (see "Trustees and Officers").
The Distribution Agreement will terminate automatically if assigned by either
party thereto and is terminable at any time without penalty by a vote of a
majority of the Trustees of the Trust, a vote of a majority of the Trustees who
are not "interested persons" of the Trust, or by a vote of the holders of a
majority of the Fund's

<PAGE>

outstanding shares as defined under "Additional Information," in any case
without payment of any penalty on not more than 60 days' nor less than 30 days'
written notice to the other party. The principal offices of SBDS are located at
6 St.
James Avenue, Boston, Massachusetts 02116.

SBDS also serves as the Trust's and the Portfolios' Administrator and
in that capacity administers and manages all aspects of the Funds' and the
Portfolios' day-to-day operations subject to the supervision of the Trustees,
except as set forth under Investment Advisor, Services Agent and Custodian. In
connection with its responsibilities as Administrator, SBDS (i) furnishes
ordinary clerical and related services for day-to-day operations including
certain record keeping responsibilities; (ii) takes responsibility for
compliance with all applicable federal and state securities and other regulatory
requirements including, without limitation, preparing and mailing and filing
(but not paying for) registration statements, prospectuses, statements of
additional information, and proxy statements and all required reports to the
Trust's shareholders, the SEC, the Secretary of The Commonwealth of
Massachusetts, and state securities commissions (but not the Trust's federal and
state tax returns); (iii) is responsible for the registration of sufficient Fund
shares under federal and state securities laws; (iv) takes responsibility for
monitoring each Fund's status as a regulated investment company under the Code;
and (v) performs such administrative and managerial oversight of the activities
of the Trust's and the Portfolios' custodian and transfer agent as the
respective Trustees may direct from time to time.

Under the Trust's Administration Agreement, the annual administration
fee rate is calculated daily based on the aggregate daily net assets of The JPM
Advisor Funds, as well as The Pierpont Funds and The JPM Institutional Funds,
which are two other families of mutual funds investing in the Portfolios. The
fee rate is calculated daily in accordance with the following schedule: 0.040%
of the first $1 billion of these funds' aggregate daily net assets, 0.032% of
the next $2 billion of these funds' aggregate daily net assets, 0.024% of the
next $2 billion of these funds' aggregate daily net assets and 0.016% of these
funds' aggregate daily net assets in excess of $5 billion. This fee rate is then
applied to the net assets of each Fund. The Administrator may voluntarily waive
a portion of its fees.

Under the Portfolios' Administration Agreements, the annual
administration fee rate is calculated based on the aggregate average daily net
assets of the Portfolios, as well as all of the other portfolios in which series
of The Pierpont Funds or The JPM Institutional Funds invest. The fee rate is
calculated daily in accordance with the following schedule: 0.010% of the first
$1 billion of these Portfolios' aggregate average daily net assets, 0.008% of
the next $2 billion of these Portfolios' aggregate average daily net assets,
0.006% of the next $2 billion of these Portfolios' aggregate average daily net
assets and 0.004% of these Portfolios' aggregate average daily net assets in
excess of $5 billion. This fee rate is then applied to the net assets of each
Portfolio. The Administrator may voluntarily waive a portion of its fees.

Below are set forth for each Fund listed and its corresponding
Portfolio the administrative fees paid to the Administrator for the fiscal
periods indicated. See "Expenses" in the Prospectus and below for applicable
expense limitations.

<PAGE>

U.S. FIXED INCOME PORTFOLIO (U.S. FIXED INCOME FUND)--For the period July 12,
1993 (commencement of operations) through October 31, 1993: $950. For the
fiscal year ended October 31, 1994: $16,107.

SELECTED U.S. EQUITY PORTFOLIO--For the period July 19, 1993 (commencement of
operations) through May 31, 1994: $19,348. For the fiscal year ended May 31,
1995: $32,670

U.S. EQUITY FUND--For the fiscal year ended May 31, 1995: $0.

U.S. SMALL COMPANY PORTFOLIO--For the period July 19, 1993 (commencement of
operations) through May 31, 1994: $30,420. For the fiscal year ended May 31,
1995: $38,215.

U.S. SMALL CAP EQUITY FUND--For the fiscal year ended May 31, 1995: $0.

NON-U.S. EQUITY PORTFOLIO (INTERNATIONAL EQUITY FUND)--For the period October 4,
1993 (commencement of operations) through October 31, 1993: $1,005. For the
fiscal year ended October 31, 1994: $22,024.

EMERGING MARKETS EQUITY PORTFOLIO (EMERGING MARKETS EQUITY FUND)-- For the
period November 15, 1993 (commencement of operations) through October 31, 1994:
$30,828.

The Administration Agreements may be renewed or amended by the
respective Trustees without a shareholder vote. The Administration Agreements
are terminable at any time without penalty by a vote of a majority of the
Trustees of the Trust or the Portfolios, as applicable, on not more than 60
days' written notice nor less than 30 days' written notice to the other party.
The Administrator may subcontract for the performance of its obligations under
the Administration Agreements only if the Trustees approve such subcontract and
find the subcontracting party to be qualified to perform the obligations sought
to be subcontracted, provided, however, that unless the Trust or the Portfolios,
as applicable, expressly agrees in writing, the Administrator shall be fully
responsible for the acts and omissions of any subcontractor as it would for its
own acts or omissions.

SERVICES AGENT

The Trust, on behalf of each Fund, has entered into a Services
Agreement with Morgan pursuant to which Morgan acts as Services Agent to the
Funds and provides shareholder services to shareholders of the Funds. Morgan is
responsible for certain accounting and operational services provided to each
Fund. The accounting and operational services to be provided by Morgan under the
agreement include, but are not limited to, monitoring the fund and shareholder
accounting activities of the Custodian; assisting the Administrator in preparing
tax returns, reviewing financial reports, coordinating annual audits, assisting

<PAGE>

in the development of budgets, overseeing preparation of tax information for
Fund shareholders; monitoring the fund accounting activities and daily
partnership allocation; and providing other related services.

Under the Services Agreement with the Trust, Morgan is also responsible
for performing shareholder account administrative and servicing functions, which
includes, but is not limited to, answering inquiries regarding account status
and history, the manner in which purchases and redemptions of Fund shares may be
effected, and certain other matters pertaining to the Funds; assisting customers
in designating and changing dividend options, account designations and
addresses; providing necessary personnel and facilities to coordinate the
establishment and maintenance of shareholder accounts and records with the
Funds' transfer agent; transmitting purchase and redemption orders to the Funds'
transfer agent and arranging for the wiring or other transfer of funds to and
from customer accounts in connection with orders to purchase or redeem Fund
shares; verifying purchase and redemption orders, transfers among and changes in
accounts; informing the Distributor of the gross amount of purchase orders for
Fund shares; and providing other related services.

In addition, Morgan is responsible for the annual costs to the Funds of
certain usual and customary expenses incurred by the Funds (the "expense
undertaking"). The expenses covered by the expense undertaking include, but are
not limited to, transfer, registrar, and dividend disbursing costs, legal and
accounting expenses, the fees of the Administrator, the cost of any liability
insurance or fidelity bonds, the compensation and expenses of the Trustees, the
expenses of printing and mailing reports, notices and proxies to Fund
shareholders, interest charges, membership dues in the Investment Company
Institute, shareholder meeting fees and registration fees under federal or state
securities laws. The Funds will pay these expenses directly and such amounts
will be deducted from the fees to be paid to Morgan under the Services
Agreement. If such amounts are more than the amount of Morgan's fees under any
of the agreement, Morgan will reimburse the applicable Fund for such excess
amounts.

Under the Trust's Services Agreement, the administration and operation
expenses of each Fund not covered by the expense undertakings, and for which
each Fund is responsible, include the services agent fee, organization expenses
and extraordinary expenses as defined in the Services Agreement, which includes
litigation and indemnification expenses and material increases in expenses due
to occurrences such as significant increases in the fee schedules of service
providers or significant decreases in a Fund's asset level due to changes in tax
or other laws or other extraordinary occurrences outside of the ordinary course
of a Fund's business.

The Trust's Services Agreement provides for each Fund to pay Morgan a
fee for these services which is computed daily and may be paid monthly at the
following annual rates of average daily net assets: U.S. Fixed Income Fund,
0.60%; International Fixed Income Fund, 0.68%; U.S. Equity and U.S. Small Cap
Equity Funds, 0.69%; International Equity Fund, 0.76%; Emerging Markets Equity
Fund, 0.77%; and Asia Growth, European Equity and Japan Equity Funds, 0.75%. As
noted immediately above, both of these fee levels reflect payments made directly
to third parties by each of the Funds for expenses covered by the expense
undertakings, as well as payments to Morgan for services rendered under the
agreement. For the Funds, the Trustees regularly review amounts paid to and

<PAGE>

accounted for by Morgan pursuant to this agreement. Under the agreement, Morgan
may delegate one or more of its responsibilities to other entities, including
SBDS, at Morgan's expense. The agreement may be terminated at any time, without
penalty, by the respective Trustees or Morgan, in each case on not more than 60
days' nor less than 30 days' written notice to the other party.

Below are set forth for each Fund listed the fees paid to Morgan, net
of fee waivers and reimbursements, under the Services Agreement, for the fiscal
periods indicated. See "Expenses" in the Prospectus and below for applicable
expense limitations.

U.S. EQUITY FUND--For the period March 24, 1995 (commencement of operations)
through May 31, 1995: $0.

U.S. SMALL CAP EQUITY FUND--For the period March 24, 1995 (commencement of
operations) through May 31, 1995: $0.

As discussed under "Investment Advisor," the Glass-Steagall Act and
other applicable laws and regulations limit the activities of bank holding
companies and certain of their subsidiaries in connection with registered
open-end investment companies. The activities of Morgan in providing accounting
and operational services to the Funds and the Portfolios and shareholder
services to the Trust's shareholders under the Services Agreements and in acting
as Advisor to the Portfolios under the Investment Advisory Agreements, may raise
issues under these laws. However, Morgan believes that it may properly perform
these services and the other activities described in the Prospectus without
violation of the Glass-Steagall Act or other applicable banking laws or
regulations.

If Morgan were prohibited from providing any of the services under the
Services Agreements, the respective Trustees would seek an alternative provider
of such services. In such event, changes in the operation of the Funds or the
Portfolios might occur and a shareholder might no longer be able to avail
himself or herself of any services then being provided to shareholders by
Morgan.

CUSTODIAN

State Street Bank and Trust Company ("State Street"), 225 Franklin
Street, Boston, Massachusetts 02101, serves as the Trust's and each of the
Portfolio's Custodian and Transfer and Dividend Disbursing Agent. Pursuant to
the Custodian Contract with each of the Portfolios, it is responsible for
maintaining the books and records of portfolio transactions and holding
portfolio securities and cash. In the case of the Selected U.S. Equity and U.S.
Small Company Portfolios, the Custodian has entered into subcustodian agreements
with Morgan for the purpose of holding participations in master demand
obligations. In the case of foreign assets held outside the United States, the
Custodian employs various subcustodians who were approved by the Trustees of the
Portfolios in accordance with the regulations of the SEC. The Custodian
maintains portfolio transaction

<PAGE>

records. As Transfer Agent and Dividend Disbursing Agent, State Street is
responsible for maintaining account records detailing the ownership of Fund
shares and for crediting income, capital gains and other changes in share
ownership to shareholder accounts. Under the terms of the Services Agreements
between the Trust and Morgan, Morgan is responsible for the usual and customary
fees of the Custodian for each Fund (see "Services Agent"); the corresponding
Portfolio is responsible for the fees of the Custodian for the Portfolio (see
"Services Agent").

INDEPENDENT ACCOUNTANTS

The independent accountants of the Trust and the Portfolios are Price
Waterhouse LLP, 1177 Avenue of the Americas, New York, New York 10036. Price
Waterhouse LLP conducts an annual audit of the financial statements of each of
the Funds and the Portfolios, assists in the preparation and/or review of each
of the Fund's and the Portfolio's federal and state income tax returns and
consults with the Funds and the Portfolios as to matters of accounting and
federal and state income taxation.

EXPENSES

Each Fund is responsible for Morgan's fees as Services Agent for the
Fund, and any fees or expenses not covered by the Services Agreement with the
Trust (see "Services Agent"). In addition, each Portfolio is responsible for
Morgan's fees as investment advisor and Services Agent for the Portfolio, the
fees of the Custodian for the Portfolio, and any fees or expenses not covered by
the Services Agreement with the Portfolio (see "Services Agent").

Morgan has agreed that if in any fiscal year the sum of any Fund's
expenses exceeds the limits set by applicable regulations of state securities
commissions, the fees payable by the Fund to Morgan for that year shall be
reduced as specified by agreement with the Trust on behalf of the Fund.
Currently, Morgan believes that the most restrictive expense limitation of state
securities commissions limits expenses to 2.5% of the first $30 million of
average net assets, 2% of the next $70 million of such net assets and 1.5% of
such net assets in excess of $100 million for any fiscal year. For additional
information regarding waivers or expense subsidies, see "Management of the Trust
and the Portfolios" in the Prospectus.

PURCHASE OF SHARES

Investors may open Fund accounts and purchase shares as described in
the Prospectus under "Purchase of Shares." References in the Prospectus and this
Statement of Additional Information to customers of Morgan or an Eligible
Institution include customers of their affiliates and references to transactions
by customers with Morgan or an Eligible Institution include transactions with
their affiliates. Only Fund investors who are using the services of Morgan or a
financial institution acting pursuant to an agreement with Morgan or the Trust
on behalf of a Fund may make transactions in shares of a Fund.

Each Fund may, at its own option, accept securities in payment for
shares. The securities delivered in payment for shares are valued by the method
described under "Net Asset Value" as of the day the Fund receives the
securities. This is

<PAGE>

a taxable transaction to the shareholder. Securities may be accepted in payment
for shares only if they are, in the judgment of Morgan, appropriate investments
for the Fund's corresponding Portfolio. In addition, securities accepted in
payment for shares must: (i) meet the investment objective and policies of the
acquiring Fund's corresponding Portfolio; (ii) be acquired by the applicable
Fund for investment and not for resale (other than for resale to the Fund's
corresponding Portfolio); (iii) be liquid securities which are not restricted as
to transfer either by law or liquidity of market; and (iv) if stock, have a
value which is readily ascertainable as evidenced by a listing on a stock
exchange, over-the-counter market or by readily available market quotations from
a dealer in such securities. Each Fund reserves the right to accept or reject at
its own option any and all securities offered in payment for its shares.

Prospective investors may purchase shares with the assistance of an
Eligible Institution, and the Eligible Institution may charge the investor a fee
for this service and other services it provides to its customers.

REDEMPTION OF SHARES

Investors may redeem shares as described in the Prospectus under
"Redemption of Shares."

If the Trust on behalf of a Fund and its corresponding Portfolio
determine that it would be detrimental to the best interest of the remaining
shareholders of a Fund to make payment wholly or partly in cash, payment of the
redemption price may be made in whole or in part by a distribution in kind of
securities from the Portfolio, in lieu of cash, in conformity with the
applicable rule of the SEC. If shares are redeemed in kind, the redeeming
shareholder might incur transaction costs in converting the assets into cash.
The method of valuing portfolio securities is described under "Net Asset Value,"
and such valuation will be made as of the same time the redemption price is
determined. The Trust on behalf of all of the Funds and their corresponding
Portfolios (except The Non- U.S. Fixed Income Portfolio) have elected to be
governed by Rule 18f-1 under the 1940 Act pursuant to which the Funds and the
corresponding Portfolios are obligated to redeem shares solely in cash up to the
lesser of $250,000 or 1% of the net asset value of the Fund during any 90-day
period for any one shareholder. The Trust will redeem Fund shares in kind only
if it has received a redemption in kind from the corresponding Portfolio and
therefore shareholders of the Fund that receive redemptions in kind will receive
securities of the Portfolio. The Portfolios have advised the Trust that the
Portfolios will not redeem in kind except in circumstances in which a Fund is
permitted to redeem in kind.

FURTHER REDEMPTION INFORMATION. The Trust on behalf of a Fund and the
Portfolios reserve the right to suspend the right of redemption and to postpone
the date of payment upon redemption as follows: (i) for up to seven days, (ii)
during periods when the New York Stock Exchange is closed for other than
weekends and holidays or when trading on such Exchange is restricted as
determined by the SEC by rule or regulation, (iii) during periods in which an
emergency, as determined by the SEC, exists that causes disposal by the
Portfolio of, or evaluation of the net asset value of, its portfolio securities
to be unreasonable or impracticable, or (iv) for such other periods as the SEC
may permit.

<PAGE>

EXCHANGE OF SHARES

An investor may exchange shares from any JPM Advisor Fund into any
other JPM Advisor Fund, as described under "Exchange of Shares" in the
Prospectus. For complete information, the Prospectus as it relates to the Fund
into which a transfer is being made should be read prior to the transfer.
Requests for exchange are made in the same manner as requests for redemptions.
See "Redemption of Shares." Shares of the Fund to be acquired are purchased for
settlement when the proceeds from redemption become available. In the case of
investors in certain states, state securities laws may restrict the availability
of the exchange privilege. The Trust reserves the right to discontinue, alter or
limit the exchange privilege at any time.

DIVIDENDS AND DISTRIBUTIONS

Each Fund declares and pays dividends and distributions as described
under "Dividends and Distributions" in the Prospectus.

NET ASSET VALUE

Each of the Funds computes its net asset value once daily on Monday
through Friday as described under "Net Asset Value" in the Prospectus. The net
asset value will not be computed on a day in which no orders to purchase or
redeem Fund shares have been received or on the day the following legal holidays
are observed: New Year's Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. On days when
U.S. trading markets close early in observance of these holidays, the Funds and
the Portfolios would expect to close for purchases and redemptions at the same
time. The days on which net asset value is determined are the Funds' business
days.

The net asset value of each Fund is equal to the net asset value of the
Fund's investment in its corresponding Portfolio (which is equal to the Fund's
pro rata share of the total investment of the Fund and of any other investors in
the Portfolio liabilities) less the Fund's liabilities. The following is a
discussion of the procedures used by the Portfolios corresponding to each Fund
in valuing their assets.

U.S. FIXED INCOME AND INTERNATIONAL FIXED INCOME FUNDS. In the case of
the Portfolios for the U.S. Fixed Income and International Fixed Income Funds,
securities with a maturity of 60 days or more, including securities that are
listed on an exchange or traded over-the-counter, are valued using prices
supplied daily by an independent pricing service or services that (i) are based
on the last sale price on a national securities exchange or, in the absence of
recorded sales, at the readily available closing bid price on such exchange or
at the quoted bid price in the over-the- counter market, if such exchange or
market constitutes the broadest and most representative market for the security
and (ii) in other cases, take into account various factors affecting market
value, including yields and prices of comparable securities, indication as to
value from dealers and general market conditions. If such prices are not
supplied by the Portfolio's independent pricing service, such securities are
priced in accordance with procedures adopted by the Portfolio's Trustees. All

<PAGE>

portfolio securities with a remaining maturity of less than 60 days are valued
by the amortized cost method. Securities listed on a foreign exchange are valued
at the last quoted sale price available before the time when net assets are
valued. Because of the large number of municipal bond issues outstanding and the
varying maturity dates, coupons and risk factors applicable to each issuer's
books, no readily available market quotations exist for most municipal
securities.

Trading in securities in most foreign markets is normally completed
before the close of trading in U.S. markets and may also take place on days on
which the U.S. markets are closed. If events materially affecting the value of
securities occur between the time when the market in which they are traded
closes and the time when a Portfolio's net asset value is calculated, such
securities will be valued at fair value in accordance with procedures
established by and under the general supervision of the Portfolio's Trustees.

U.S. EQUITY, U.S. SMALL CAP EQUITY, INTERNATIONAL EQUITY, EMERGING
MARKETS EQUITY, ASIA GROWTH, EUROPEAN EQUITY AND JAPAN EQUITY FUNDS. In the case
of each of the Equity Portfolios, the value of investments listed on a domestic
securities exchange, other than options on stock indexes, is based on the last
sale prices on the New York Stock Exchange at 4:00 P.M. or, in the absence of
recorded sales, at the average of readily available closing bid and asked prices
on such exchange. Securities listed on a foreign exchange are valued at the last
quoted sale price available before the time when net assets are valued. Unlisted
securities are valued at the average of the quoted bid and asked prices in the
over-the-counter market. The value of each security for which readily available
market quotations exist is based on a decision as to the broadest and most
representative market for such security. For purposes of calculating net asset
value, all assets and liabilities initially expressed in foreign currencies will
be converted into U.S. dollars at the prevailing market rates available at the
time of valuation.

Options on stock indexes traded on national securities exchanges are
valued at the close of options trading on such exchanges which is currently 4:10
P.M., New York time. Stock index futures and related options, which are traded
on commodities exchanges, are valued at their last sales price as of the close
of such commodities exchanges which is currently 4:15 P.M., New York time.
Securities or other assets for which market quotations are not readily available
are valued at fair value in accordance with procedures established by and under
the general supervision and responsibility of the Portfolio's Trustees. Such
procedures include the use of independent pricing services which use prices
based upon yields or prices of securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions. Short-term investments which mature in 60 days or less are valued at
amortized cost if their original maturity was 60 days or less, or by amortizing
their value on the 61st day prior to maturity, if their original maturity when
acquired by the Portfolio was more than 60 days, unless this is determined not
to represent fair value by the Trustees.

Trading in securities on most foreign exchanges and over-the-counter
markets is normally completed before the close of the New York Stock Exchange
and may also take place on days on which the New York Stock Exchange is closed.
If

<PAGE>

events materially affecting the value of securities occur between the time when
the exchange on which they are traded closes and the time when a Portfolio's net
asset value is calculated, such securities will be valued at fair value in
accordance with procedures established by and under the general supervision of
the Portfolio's Trustees.

PERFORMANCE DATA

From time to time, the Funds may quote performance in terms of yield,
actual distributions, total return or capital appreciation in reports, sales
literature and advertisements published by the Trust. Current performance
information for the Funds may be obtained by calling the number provided on the
cover page of this Statement of Additional Information. See "Additional
Information" in the Prospectus.

YIELD QUOTATIONS. As required by regulations of the SEC, the annualized
yield for the U.S. Fixed Income and International Fixed Income Funds is computed
by dividing each Fund's net investment income per share earned during a 30-day
period by the net asset value on the last day of the period. The average daily
number of shares outstanding during the period that are eligible to receive
dividends is used in determining the net investment income per share. Income is
computed by totaling the interest earned on all debt obligations during the
period and subtracting from that amount the total of all recurring expenses
incurred during the period. The 30-day yield is then annualized on a
bond-equivalent basis assuming semi-annual reinvestment and compounding of net
investment income, as described under "Additional Information" in the
Prospectus.

TOTAL RETURN QUOTATIONS. As required by regulations of the SEC, the
annualized total return of each of the Funds for a period is computed by
assuming a hypothetical initial payment of $1,000. It is then assumed that all
of the dividends and distributions by the Fund over the period are reinvested.
It is then assumed that at the end of the period, the entire amount is redeemed.
The annualized total return is then calculated by determining the annual rate
required for the initial payment to grow to the amount which would have been
received upon redemption.

Aggregate total returns, reflecting the cumulative percentage change
over a measuring period, may also be calculated.

Historical performance information for any period or portion thereof
prior to the inception of each Fund will be that of its corresponding Pierpont
Fund (or, in the case of the International Fixed Income Fund, its corresponding
JPM Institutional Fund) which also invests all of its investable assets in the
Fund's corresponding Portfolio, as permitted by applicable SEC staff
interpretations, if the Pierpont Fund commenced operations before its
corresponding JPM Advisor Fund. The applicable financial information in the
registration statement for The Pierpont Funds (Registration Nos. 33-54632 and
811-7340) and The JPM Institutional Funds (Registration Nos. 33-54642 and
811-7342) is hereby incorporated by reference. The table that follows sets forth
historical return information for the periods indicated:

<PAGE>

Below is set forth historical return information for the Funds for the
periods indicated:

U.S. FIXED INCOME FUND (4/30/95): Average annual total return, 1 year: 6.57%;
average annual total return, 5 years: 8.23%; average annual total return,
commencement of operations(*) to period end: 7.79%; aggregate total return, 1
year: 6.51%; aggregate total return, 5 years: 48.50%; aggregate total return,
commencement of operations(*) to period end: 70.12%.

U.S. EQUITY FUND (5/31/95): Average annual total return, 1 year: []%; average
annual total return, 5 years: []%; average annual total return, commencement of
operations(*) to period end: []%; aggregate total return, 1 year: []%; aggregate
total return, 5 years: []%; aggregate total return, commencement of
operations(*) to period end: []%.

U.S. SMALL CAP EQUITY FUND (5/31/95): Average annual total return, 1 year: []%;
average annual total return, 5 years: []%; average annual total return,
commencement of operations(*) to period end: []%; aggregate total return, 1
year: []%; aggregate total return, 5 years: []%; aggregate total return,
commencement of operations(*) to period end: []%.

INTERNATIONAL EQUITY FUND (4/30/95): Average annual total return, 1 year: 0.32%;
average annual total return, 5 years: N/A; average annual total return,
commencement of operations(*) to period end: 3.85%; aggregate total return, 1
year: 0.32%; aggregate total return, 5 years: N/A; aggregate total return,
commencement of operations(*) to period end: 20.41%.

EMERGING MARKETS EQUITY FUND (4/30/95): Average annual total return, 1 year:
(9.73)%; average annual total return, 5 years: N/A; average annual total return,
commencement of operations(*) to period end: (2.98)%; aggregate total return, 1
year: (9.73)%; aggregate total return, 5 years: N/A; aggregate total return,
commencement of operations(*) to period end: (4.20)%.
- --------------------
* The corresponding Pierpont Funds to the U.S. Fixed Income, U.S. Equity, U.S.
Small Cap Equity and International Equity Funds commenced operations on July 12,
1993, July 19, 1993, July 19, 1993 and October 4, 1993, respectively. The
predecessors to these corresponding Pierpont Funds -- The Pierpont Bond Fund,
The Pierpont Equity Fund, The Pierpont Capital Appreciation Fund and The
Pierpont International Equity Fund, Inc. -- commenced operations on March 11,
1988, June 27, 1985, June 27, 1985 and June 1, 1990, respectively. The
corresponding Pierpont Fund to the Emerging Markets Equity Fund commenced
operations on November 15, 1993.

GENERAL. A Fund's performance will vary from time to time depending
upon market conditions, the composition of its corresponding Portfolio and its
operating expenses. Consequently, any given performance quotation should not be
considered representative of a Fund's performance for any specified period in
the future. In addition, because performance will fluctuate, it may not provide
a basis for comparing an investment in a Fund with certain bank deposits or
other investments that pay a fixed yield or return for a stated period of time.

<PAGE>

Comparative performance information may be used from time to time in
advertising the Fund's shares, including data from Lipper Analytical Services,
Inc., Micropal, Inc., Ibbotson Associates, Morningstar Inc., the S&P 500
Composite Stock Price Index, the Dow Jones Industrial Average, the Frank Russell
Indexes, The EAFE Index, The IFC-JPM Emerging Markets Index, Tokyo Stock Price
Index, Salomon Brothers Non-U.S. World Government Bond Index (Hedged) and other
industry publications.

From time to time, the Funds may quote performance in terms of yield,
actual distributions, total return, or capital appreciation in reports, sales
literature, and advertisements published by the Funds. Current performance
information for the Funds may be obtained by calling the number provided on the
cover page of this Statement of Additional Information. See "Additional
Information" in the Prospectus.

PORTFOLIO TRANSACTIONS

J.P. Morgan Investment Management Inc., acting as agent for Morgan,
places orders for all Portfolios for all purchases and sales of portfolio
securities. Morgan enters into repurchase agreements and reverse repurchase
agreements and executes loans of portfolio securities on behalf of all the
Portfolios. See "Investment Objectives and Policies."

Fixed income and debt securities and municipal bonds and notes are
generally traded at a net price with dealers acting as principal for their own
accounts without a stated commission. The price of the security usually includes
profit to the dealers. In underwritten offerings, securities are purchased at a
fixed price which includes an amount of compensation to the underwriter,
generally referred to as the underwriter's concession or discount. On occasion,
certain securities may be purchased directly from an issuer, in which case no
commissions or discounts are paid.

U.S. FIXED INCOME AND INTERNATIONAL FIXED INCOME FUNDS. Portfolio
transactions for the Portfolios corresponding to the U.S. Fixed Income and
International Fixed Income Funds will be undertaken principally to accomplish a
Portfolio's objective in relation to expected movements in the general level of
interest rates. The Fixed Income and Non-U.S. Fixed Income Portfolios may engage
in short-term trading consistent with their objectives. The estimated portfolio
turnover rate for each of the U.S. Fixed Income and Non-U.S. Fixed Income
Portfolios generally should not exceed 300%.

In connection with portfolio transactions for the Portfolios, J.P.
Morgan Investment Management Inc. intends to seek best price and execution on a
competitive basis for both purchases and sales of securities.

U.S. EQUITY, U.S. SMALL CAP EQUITY, INTERNATIONAL EQUITY, EMERGING
MARKETS EQUITY, ASIA GROWTH, EUROPEAN EQUITY AND JAPAN EQUITY FUNDS. In
connection with portfolio transactions for the Equity Portfolios, the overriding
objective is to obtain the best possible execution of purchase and sale orders.
The estimated portfolio turnover rate for each of the Equity Portfolios
generally should not exceed 100%.

<PAGE>

In selecting a broker, J.P. Morgan Investment Management Inc. considers
a number of factors including: the price per unit of the security; the broker's
reliability for prompt, accurate confirmations and on-time delivery of
securities; the firm's financial condition; as well as the commissions charged.
A broker may be paid a brokerage commission in excess of that which another
broker might have charged for effecting the same transaction if, after
considering the foregoing factors, J.P. Morgan Investment Management Inc.
decides that the broker chosen will provide the best possible execution. J.P.
Morgan Investment Management Inc. and Morgan monitor the reasonableness of the
brokerage commissions paid in light of the execution received. The Trustees of
each Portfolio review regularly the reasonableness of commissions and other
transaction costs incurred by the Portfolios in light of facts and circumstances
deemed relevant from time to time, and, in that connection, will receive reports
from the Advisor and published data concerning transaction costs incurred by
institutional investors generally. Research services provided by brokers to
which J.P. Morgan Investment Management Inc. has allocated brokerage business in
the past include economic statistics and forecasting services, industry and
company analyses, portfolio strategy services, quantitative data, and consulting
services from economists and political analysts. Research services furnished by
brokers are used for the benefit of all the Advisor's clients and not solely or
necessarily for the benefit of an individual Portfolio. The Advisor believes
that the value of research services received is not determinable and does not
significantly reduce its expenses. The Portfolios do not reduce their fee to the
Advisor by any amount that might be attributable to the value of such services.

The Portfolios or their predecessors corresponding to the U.S. Equity,
U.S. Small Cap Equity, International Equity and Emerging Markets Equity Funds
paid the following approximate brokerage commissions for the indicated fiscal
years:

SELECTED U.S. EQUITY FUND (May): 1995: $1,179,132; 1994: $744,676; 1993:
$293,698.

U.S. SMALL COMPANY FUND (May): 1995: $1,217,016; 1994: $1,760,320; 1993:
$142,310.

INTERNATIONAL EQUITY FUND (October): 1994: $1,413,238; 1993: $639,000; 1992:
$157,000.

EMERGING MARKETS EQUITY FUND (October): 1994: $1,262,905; 1993: N/A; 1992: N/A.

The increases in brokerage commissions reflected above were due to
increased portfolio activity and an increase in net investments in the Portfolio
or its predecessor.

Subject to the overriding objective of obtaining the best possible
execution of orders, J.P. Morgan Investment Management Inc. may allocate a
portion of a Portfolio's brokerage transactions to affiliates of Morgan. In
order for affiliates of Morgan to effect any portfolio transactions for a
Portfolio, the commissions, fees or other remuneration received by such
affiliates must be reasonable and fair compared to the commissions, fees, or
other remuneration paid to other brokers in connection with comparable
transactions involving similar securities being purchased or sold on a
securities

<PAGE>

exchange during a comparable period of time. Furthermore, the Trustees of each
Portfolio, including a majority of the Trustees who are not "interested
persons," have adopted procedures which are reasonably designed to provide that
any commissions, fees, or other remuneration paid to such affiliates are
consistent with the foregoing standard.

Portfolio securities will not be purchased from or through or sold to
or through the Portfolios' Administrator, Distributor or Advisor or any
"affiliated person" (as defined in the 1940 Act) of the Administrator,
Distributor or Advisor when such entities are acting as principals, except to
the extent permitted by law. In addition, the Portfolios will not purchase
securities during the existence of any underwriting group relating thereto of
which the Advisor or an affiliate of the Advisor is a member, except to the
extent permitted by law.

On those occasions when Morgan deems the purchase or sale of a security
to be in the best interests of a Portfolio as well as other customers including
other Portfolios, J.P. Morgan Investment Management Inc. to the extent permitted
by applicable laws and regulations may, but is not obligated to, aggregate the
securities to be sold or purchased for a Portfolio with those to be sold or
purchased for other customers in order to obtain best execution, including lower
brokerage commissions if appropriate. In such event, allocation of the
securities so purchased or sold as well as any expenses incurred in the
transaction will be made by J.P. Morgan Investment Management Inc. in the manner
it considers to be most equitable and consistent with Morgan's fiduciary
obligations to a Portfolio. In some instances, this procedure might adversely
affect a Portfolio.

If a Portfolio that writes options effects a closing purchase
transaction with respect to an option written by it, normally such transaction
will be executed by the same broker-dealer who executed the sale of the option.
The writing of options by a Portfolio will be subject to limitations established
by each of the exchanges governing the maximum number of options in each class
which may be written by a single investor or group of investors acting in
concert, regardless of whether the options are written on the same or different
exchanges or are held or written in one or more accounts or through one or more
brokers. The number of options which a Portfolio may write may be affected by
options written by the Advisor for other investment advisory clients. An
exchange may order the liquidation of positions found to be in excess of these
limits, and it may impose certain other sanctions.

MASSACHUSETTS TRUST

The Trust is a trust fund of the type commonly known as a
"Massachusetts business trust" of which each Fund is a separate and distinct
series. A copy of the Declaration of Trust for the Trust is on file in the
office of the Secretary of The Commonwealth of Massachusetts. The Declaration of
Trust and the By-Laws of the Trust are designed to make the Trust similar in
most respects to a Massachusetts business corporation. The principal distinction
between the two forms concerns shareholder liability described below.

Under Massachusetts law, shareholders of such a trust may, under
certain circumstances, be held personally liable as partners for the obligations
of the trust which is not the case for a corporation. However, the Trust's
Declaration

<PAGE>

of Trust provides that the shareholders shall not be subject to any personal
liability for the acts or obligations of any Fund and that every written
agreement, obligation, instrument or undertaking made on behalf of any Fund
shall contain a provision to the effect that the shareholders are not personally
liable thereunder.

No personal liability will attach to the shareholders under any
undertaking containing such provision when adequate notice of such provision is
given, except possibly in a few jurisdictions. With respect to all types of
claims in the latter jurisdictions, (i) tort claims, (ii) contract claims where
the provision referred to is omitted from the undertaking, (iii) claims for
taxes, and (iv) certain statutory liabilities in other jurisdictions, a
shareholder may be held personally liable to the extent that claims are not
satisfied by the Fund. However, upon payment of such liability, the shareholder
will be entitled to reimbursement from the general assets of the Fund. The
Trustees intend to conduct the operations of the Trust in such a way so as to
avoid, as far as possible, ultimate liability of the shareholders for
liabilities of the Funds.

The Trust's Declaration of Trust further provides that the name of the
Trust refers to the Trustees collectively as Trustees, not as individuals or
personally, that no Trustee, officer, employee or agent of a Fund is liable to a
Fund or to a shareholder, and that no Trustee, officer, employee or agent is
liable to any third persons in connection with the affairs of a Fund, except as
such liability may arise from his or its own bad faith, willful misfeasance,
gross negligence or reckless disregard of his or its duties to such third
persons. It also provides that all third persons shall look solely to Fund
property for satisfaction of claims arising in connection with the affairs of a
Fund. With the exceptions stated, the Trust's Declaration of Trust provides that
a Trustee, officer, employee or agent is entitled to be indemnified against all
liability in connection with the affairs of a Fund.

The Trust shall continue without limitation of time subject to the
provisions in the Declaration of Trust concerning termination by action of the
shareholders or by action of the Trustees upon notice to the shareholders.

DESCRIPTION OF SHARES

The Trust is an open-end management investment company organized as a
Massachusetts business trust in which each Fund represents a separate series of
shares of beneficial interest. See "Massachusetts Trust."

The Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares ($0.001 par value) of one or more series
and classes within any series and to divide or combine the shares (of any
series, if applicable) without changing the proportionate beneficial interest of
each shareholder in a Fund (or in the assets of other series, if applicable). To
date shares of the nine series described in this Statement of Additional
Information have been authorized and are available for sale to the public. Each
share represents an equal proportional interest in a Fund with each other share.
Upon liquidation of a Fund, holders are entitled to share pro rata in the net
assets of a Fund available for distribution to such shareholders. See
"Massachusetts Trust." Shares of a Fund have no preemptive or conversion rights
and are fully

<PAGE>

paid and nonassessable. The rights of redemption and exchange are described in
the Prospectus and elsewhere in this Statement of Additional Information.

The shareholders of the Trust are entitled to a full vote for each full
share held and to a fractional vote for each fractional share. Subject to the
1940 Act, the Trustees themselves have the power to alter the number and the
terms of office of the Trustees, to lengthen their own terms, or to make their
terms of unlimited duration subject to certain removal procedures, and to
appoint their own successors, PROVIDED, HOWEVER, that immediately after such
appointment the requisite majority of the Trustees have been elected by the
shareholders of the Trust. The voting rights of shareholders are not cumulative
so that holders of more than 50% of the shares voting can, if they choose, elect
all Trustees being selected while the shareholders of the remaining shares would
be unable to elect any Trustees. It is the intention of the Trust not to hold
meetings of shareholders annually. The Trustees may call meetings of
shareholders for action by shareholder vote as may be required by either the
1940 Act or the Trust's Declaration of Trust.

Shareholders of the Trust have the right, upon the declaration in
writing or vote of more than two-thirds of its outstanding shares, to remove a
Trustee. The Trustees will call a meeting of shareholders to vote on removal of
a Trustee upon the written request of the record holders of 10% of the Trust's
shares. In addition, whenever ten or more shareholders of record who have been
such for at least six months preceding the date of application, and who hold in
the aggregate either shares having a net asset value of at least $25,000 or at
least 1% of the Trust's outstanding shares, whichever is less, shall apply to
the Trustees in writing, stating that they wish to communicate with other
shareholders with a view to obtaining signatures to request a meeting for the
purpose of voting upon the question of removal of any Trustee or Trustees and
accompanied by a form of communication and request which they wish to transmit,
the Trustees shall within five business days after receipt of such application
either: (1) afford to such applicants access to a list of the names and
addresses of all shareholders as recorded on the books of the Trust; or (2)
inform such applicants as to the approximate number of shareholders of record,
and the approximate cost of mailing to them the proposed communication and form
of request. If the Trustees elect to follow the latter course, the Trustees,
upon the written request of such applicants, accompanied by a tender of the
material to be mailed and of the reasonable expenses of mailing, shall, with
reasonable promptness, mail such material to all shareholders of record at their
addresses as recorded on the books, unless within five business days after such
tender the Trustees shall mail to such applicants and file with the SEC,
together with a copy of the material to be mailed, a written statement signed by
at least a majority of the Trustees to the effect that in their opinion either
such material contains untrue statements of fact or omits to state facts
necessary to make the statements contained therein not misleading, or would be
in violation of applicable law, and specifying the basis of such opinion. After
opportunity for hearing upon the objections specified in the written statements
filed, the SEC may, and if demanded by the Trustees or by such applicants shall,
enter an order either sustaining one or more of such objections or refusing to
sustain any of them. If the SEC shall enter an order refusing to sustain any of
such objections, or if, after the entry of an order sustaining one or more of
such objections, the SEC shall find, after notice and opportunity for hearing,
that all objections so sustained have been met, and shall enter an order so
declaring, the Trustees

<PAGE>

shall mail copies of such material to all shareholders with reasonable
promptness after the entry of such order and the renewal of such tender.

The Trustees have authorized the issuance and sale to the public of
shares of nine series of the Trust that are authorized for sale to the public.
The Trustees have no current intention to create any classes within the initial
series or any subsequent series. The Trustees may, however, authorize the
issuance of shares of additional series and the creation of classes of shares
within any series with such preferences, privileges, limitations and voting and
dividend rights as the Trustees may determine. The proceeds from the issuance of
any additional series would be invested in separate, independently managed
portfolios with distinct investment objectives, policies and restrictions, and
share purchase, redemption and net asset valuation procedures. Any additional
classes would be used to distinguish among the rights of different categories of
shareholders, as might be required by future regulations or other unforeseen
circumstances. All consideration received by the Trust for shares of any
additional series or class, and all assets in which such consideration is
invested, would belong to that series or class, subject only to the rights of
creditors of the Trust and would be subject to the liabilities related thereto.
Shareholders of any additional series or class will approve the adoption of any
management contract or distribution plan relating to such series or class and of
any changes in the investment policies related thereto, to the extent required
by the 1940 Act.

For information relating to mandatory redemption of Fund shares or
their redemption at the option of the Trust under certain circumstances, see
"Redemption of Shares" in the Prospectus.

As of August 28, 1995, Signature Financial Group, Inc. owned of record
and beneficially 100% of the outstanding shares of beneficial interest of each
Fund except U.S. Fixed Income Fund, and SFG Investors II Limited Partnership
owned of record and beneficially 100% of the outstanding shares of beneficial
interest of U.S. Fixed Income Fund. However, it is expected that these initial
shareholders will own less than 25% of each Fund's outstanding shares shortly
after the commencement of the public offering of such Fund's shares. As of the
same date, the officers and Trustees as a group owned less than 1% of the shares
of each Fund.

TAXES

Each Fund qualifies and intends to remain qualified as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"). As a regulated investment company, a Fund must, among
other things, (a) derive at least 90% of its gross income from dividends,
interest, payments with respect to loans of stock and securities, gains from the
sale or other disposition of stock, securities or foreign currency and other
income (including but not limited to gains from options, futures, and forward
contracts) derived with respect to its business of investing in such stock,
securities or foreign currency; (b) derive less than 30% of its gross income
from the sale or other disposition of stock, securities, options, futures, or
forward contracts (other than options, futures or forward contracts on foreign
currencies) held less than three months, or foreign currencies (or options,
futures or forward contracts on foreign currencies), but only if such currencies

<PAGE>

(or options, futures or forward contracts on foreign currencies) are not
directly related to a Fund's principal business of investing in stocks or
securities (or options and futures with respect to stocks or securities); and
(c) diversify its holdings so that, at the end of each fiscal quarter, (i) at
least 50% of the value of the Fund's total assets is represented by cash, U.S.
Government securities, investments in other regulated investment companies and
other securities limited, in respect of any one issuer, to an amount not greater
than 5% of the Fund's total assets, and 10% of the outstanding voting securities
of such issuer, and (ii) not more than 25% of the value of its total assets is
invested in the securities of any one issuer (other than U.S. Government
securities). As a regulated investment company, a Fund (as opposed to its
shareholders) will not be subject to federal income taxes on the net investment
income and capital gains that it distributes to its shareholders, provided that
at least 90% of its net investment income and realized net short-term capital
gains in excess of net long-term capital losses for the taxable year is
distributed.

Under the Code, a Fund will be subject to a 4% excise tax on a portion
of its undistributed income if it fails to meet certain distribution
requirements by the end of the calendar year. Each Fund intends to make
distributions in a timely manner and accordingly does not expect to be subject
to the excise tax.

For federal income tax purposes, dividends that are declared by a Fund
in October, November or December as of a record date in such month and actually
paid in January of the following year will be treated as if they were paid on
December 31 of the year declared. Therefore, such dividends will generally be
taxable to a shareholder in the year declared rather than the year paid.

Distributions of net investment income and realized net short-term
capital gains in excess of net long-term capital losses (other than exempt
interest dividends) are generally taxable to shareholders of the Funds as
ordinary income whether such distributions are taken in cash or reinvested in
additional shares. The U.S. Equity and U.S. Small Cap Equity Funds expect that a
portion of these distributions to corporate shareholders will be eligible for
the dividends-received deduction. Distributions to corporate shareholders of the
U.S. Fixed Income, International Fixed Income, International Equity, Emerging
Markets Equity, Asia Growth, European Equity and Japan Equity Funds are not
eligible for the dividends-received deduction. Distributions of net long-term
capital gains (i.e., net long-term capital gains in excess of net short-term
capital losses) are taxable to shareholders of a Fund as long-term capital
gains, regardless of whether such distributions are taken in cash or reinvested
in additional shares and regardless of how long a shareholder has held shares in
the Fund. See "Taxes" in the Prospectus for a discussion of the federal income
tax treatment of any gain or loss realized on the redemption or exchange of a
Fund's shares. Additionally, any loss realized on a redemption or exchange of
shares of a Fund will be disallowed to the extent the shares disposed of are
replaced within a period of 61 days beginning 30 days before such disposition,
such as pursuant to reinvestment of a dividend in shares of the Fund.

Gains or losses on sales of portfolio securities will be treated as
long-term capital gains or losses if the securities have been held for more than
one year except in certain cases where, if applicable, a put is acquired or a
call option is written thereon. Other gains or losses on the sale of securities

<PAGE>

will be short-term capital gains or losses. Gains and losses on the sale, lapse
or other termination of options on securities will be treated as gains and
losses from the sale of securities. If an option written by a Portfolio lapses
or is terminated through a closing transaction, such as a repurchase by the
Portfolio of the option from its holder, the Portfolio will realize a short-term
capital gain or loss, depending on whether the premium income is greater or less
than the amount paid by the Portfolio in the closing transaction. If securities
are purchased by a Portfolio pursuant to the exercise of a put option written by
it, the Portfolio will subtract the premium received from its cost basis in the
securities purchased.

Under the Code, gains or losses attributable to disposition of foreign
currency or to foreign currency contracts, or to fluctuations in exchange rates
between the time a Portfolio accrues income or receivables or expenses or other
liabilities denominated in a foreign currency and the time a Portfolio actually
collects such income or pays such liabilities, are treated as ordinary income or
ordinary loss. Similarly, gains or losses on the disposition of debt securities
held by a Portfolio, if any, denominated in foreign currency, to the extent
attributable to fluctuations in exchange rates between the acquisition and
disposition dates are also treated as ordinary income or loss.

Forward currency contracts, options and futures contracts entered into
by a Portfolio may create "straddles" for U.S. federal income tax purposes and
this may affect the character and timing of gains or losses realized by the
Portfolio on forward currency contracts, options and futures contracts or on the
underlying securities. Straddles may also result in the loss of the holding
period of underlying securities for purposes of the 30% of gross income test
described above, and therefore, the Portfolio's ability to enter into forward
currency contracts, options and futures contracts may be limited.

Certain options, futures and foreign currency contracts held by a
Portfolio at the end of each fiscal year will be required to be "marked to
market" for federal income tax purposes -- i.e., treated as having been sold at
market value. For options and futures contracts, 60% of any gain or loss
recognized on these deemed sales and on actual dispositions will be treated as
long-term capital gain or loss, and the remainder will be treated as short-term
capital gain or loss regardless of how long the Portfolio has held such options
or futures. Any gain or loss recognized on foreign currency contracts will be
treated as ordinary income.

The Equity Portfolios may invest in Equity Securities of foreign
issuers. If a Portfolio purchases shares in certain foreign investment funds
(referred to as passive foreign investment companies ("PFICs") under the Code),
the Portfolio may be subject to federal income tax on a portion of an "excess
distribution" from such foreign investment fund or gain from the disposition of
such shares, even though such income may have to be distributed as a taxable
dividend by the Fund to its shareholders. In addition, certain interest charges
may be imposed on a Fund or its shareholders in respect of unpaid taxes arising
from such distributions or gains. Alternatively, a Fund may each year include in
its income and distribute to shareholders a pro rata portion of the foreign
investment fund's income, whether or not distributed to the Fund.

<PAGE>

Pursuant to proposed regulations, open-end regulated investment
companies such as the Funds would be entitled to elect to mark to market their
stock in certain PFICs. Marking to market in this context means recognizing as
gain for each taxable year the excess, as of the end of that year, of the fair
market value of each PFIC's stock over the owner's adjusted basis in that stock
(including mark to market gains of a prior year for which an election was in
effect).

FOREIGN SHAREHOLDERS. Dividends of net investment income and
distributions of realized net short-term gains in excess of net long-term losses
to a shareholder who, as to the United States, is a nonresident alien
individual, fiduciary of a foreign trust or estate, foreign corporation or
foreign partnership (a "foreign shareholder") will be subject to U.S.
withholding tax at the rate of 30% (or lower treaty rate) unless the dividends
are effectively connected with a U.S. trade or business of the shareholder, in
which case the dividends will be subject to tax on a net income basis at the
graduated rates applicable to U.S. individuals or domestic corporations.
Distributions of net long term capital gains to foreign shareholders will not be
subject to U.S. tax unless the distributions are effectively connected with the
shareholder's trade or business in the United States or, in the case of a
shareholder who is a nonresident alien individual, the shareholder was present
in the United States for more than 182 days during the taxable year and certain
other conditions are met.

In the case of a foreign shareholder who is a nonresident alien
individual and who is not otherwise subject to withholding as described above, a
Fund may be required to withhold U.S. federal income tax at the rate of 31%
unless IRS Form W-8 is provided. See "Taxes" in the Prospectus. Transfers by
gift of shares of a Fund by a foreign shareholder who is a nonresident alien
individual will not be subject to U.S. federal gift tax, but the value of shares
of the Fund held by such a shareholder at his or her death will be includible in
his or her gross estate for U.S. federal estate tax purposes.

FOREIGN TAXES. It is expected that the corresponding Portfolios of the
International Fixed Income, U.S. Equity, U.S. Small Cap Equity, International
Equity, Emerging Markets Equity, Asia Growth, European Equity and Japan Equity
Funds may be subject to foreign withholding taxes with respect to income
received from sources within foreign countries. In the case of each of these
Funds, so long as more than 50% in value of the total assets of the Fund's
corresponding Portfolio at the close of any taxable year consists of stock or
securities of foreign corporations, the Fund may elect to treat any foreign
income taxes paid by it as paid directly by its shareholders. These Funds will
make such an election only if they deem it to be in the best interest of their
shareholders. The Funds will notify their respective shareholders in writing
each year if they make the election and of the amount of foreign income taxes,
if any, to be treated as paid by the shareholders. If a Fund makes the election,
each shareholder will be required to include in his or her income his or her
proportionate share of the amount of foreign income taxes paid by the Fund and
will be entitled to claim either a credit (subject to the limitations discussed
below) or, if he or she itemizes deductions, a deduction for his or her share of
the foreign income taxes in computing federal income tax liability. (No
deduction will be permitted in computing an individual's alternative minimum tax

<PAGE>

liability.) A shareholder who is a nonresident alien individual or a foreign
corporation may be subject to U.S. withholding tax on the income resulting from
the election described in this paragraph, but may not be able to claim a credit
or deduction against such U.S. tax for the foreign taxes treated as having been
paid by such shareholder. A tax-exempt shareholder will not ordinarily benefit
from this election. Shareholders who choose to utilize a credit (rather than a
deduction) for foreign taxes will be subject to the limitation that the credit
may not exceed the shareholder's U.S. tax (determined without regard to the
availability of the credit) attributable to his or her total foreign source
taxable income. For this purpose, the portion of dividends and distributions
paid by each of the International Fixed Income, International Equity, Emerging
Markets Equity, Asia Growth, European Equity and Japan Equity Funds from its
foreign source net investment income will be treated as foreign source income.
Each of these Funds' gains and losses from the sale of securities will generally
be treated as derived from U.S. sources, however, and certain foreign currency
gains and losses likewise will be treated as derived from U.S. sources. The
limitation on the foreign tax credit is applied separately to foreign source
"passive income," such as the portion of dividends received from the Fund which
qualifies as foreign source income. In addition, the foreign tax credit is
allowed to offset only 90% of the alternative minimum tax imposed on
corporations and individuals. Because of these limitations, shareholders may be
unable to claim a credit for the full amount of their proportionate shares of
the foreign income taxes paid by the International Fixed Income, International
Equity, Emerging Markets Equity, Asia Growth, European Equity and Japan Equity
Funds.

STATE AND LOCAL TAXES. Each Fund may be subject to state or local taxes
in jurisdictions in which the Fund is deemed to be doing business. In addition,
the treatment of a Fund and its shareholders in those states which have income
tax laws might differ from treatment under the federal income tax laws.
Shareholders should consult their own tax advisors with respect to any state or
local taxes.

OTHER TAXATION. The Trust is organized as a Massachusetts business
trust and, under current law, neither the Trust nor any Fund is liable for any
income or franchise tax in The Commonwealth of Massachusetts, provided that the
Fund continues to qualify as a regulated investment company under Subchapter M
of the Code. The Portfolios are organized as New York trusts. The Portfolios are
not subject to any federal income taxation or income or franchise tax in the
State of New York or The Commonwealth of Massachusetts. The investment by a Fund
in its corresponding Portfolio does not cause the Fund to be liable for any
income or franchise tax in the State of New York.

ADDITIONAL INFORMATION

As used in this Statement of Additional Information and the Prospectus,
the term "majority of the outstanding voting securities" means the vote of (i)
67% or more of the Fund's shares or the Portfolio's outstanding voting
securities present at a meeting if the holders of more than 50% of the Fund's
outstanding shares or the Portfolio's outstanding voting securities are present
or represented by proxy, or (ii) more than 50% of the Fund's outstanding shares
or the Portfolio's outstanding voting securities, whichever is less.

<PAGE>

Telephone calls to the Funds, Morgan or Eligible Institutions may be
tape recorded. With respect to the securities offered hereby, this Statement of
Additional Information and the Prospectuses do not contain all the information
included in the Trust's Registration Statement filed with the SEC under the 1933
Act and the Trust's and the Portfolios' Registration Statements filed under the
1940 Act. Pursuant to the rules and regulations of the SEC, certain portions
have been omitted. The Registration Statements including the exhibits filed
therewith may be examined at the office of the SEC in Washington D.C.

Statements contained in this Statement of Additional Information and
the Prospectuses concerning the contents of any contract or other document are
not necessarily complete, and in each instance, reference is made to the copy of
such contract or other document filed as an exhibit to the applicable
Registration Statements. Each such statement is qualified in all respects by
such reference.

No dealer, salesman or any other person has been authorized to give any
information or to make any representations, other than those contained in the
Prospectuses and this Statement of Additional Information, in connection with
the offer contained therein and, if given or made, such other information or
representations must not be relied upon as having been authorized by the Trust,
the Funds or the Distributor. The Prospectus and this Statement of Additional
Information do not constitute an offer by any Fund or by the Distributor to sell
or solicit any offer to buy any of the securities offered hereby in any
jurisdiction to any person to whom it is unlawful for the Fund or the
Distributor to make such offer in such jurisdictions.

FINANCIAL STATEMENTS

Attached are the audited statement of assets and liabilities and the
reports thereon of Price Waterhouse LLP for each of the Funds, except for the
U.S. Equity and U.S. Small Cap Equity Funds, and for the Asia Growth, European
Equity and Japan Equity Portfolios as of March 24, 1995, and for the Non-U.S.
Fixed Income Portfolio as of October 6, 1994.

The U.S. Equity and U.S. Small Cap Equity Funds and the U.S. Fixed
Income, Selected U.S. Equity, U.S. Small Company, Non-U.S. Equity and Emerging
Markets Equity Portfolios current reports to shareholders filed with the SEC
pursuant to Section 30(b) of the 1940 Act and Rule 30b2-1 thereunder are hereby
incorporated herein by reference. A copy of each such report will be provided,
without charge, to each person receiving this Statement of Additional
Information.

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR U.S. FIXED INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The U.S. Fixed Income Portfolio $ 100,000
Deferred Organization Expenses 58,000
-------
Total Assets 158,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100,000

Net Asset Value Per Share (10,000 shares of
beneficial interest outstanding; unlimited authorized
shares of beneficial interest of $0.001 par value),
Offering and Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor U.S. Fixed Income Fund (the "Fund") is a series of The JPM
Advisor Funds, a Massachusetts business trust (the "Trust") organized on
September 16, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sale of 10,000 shares (the
"initial shares") of the Fund to SFG Investors II Limited Partnership ("SFG
Investors"), an affiliate of Signature Broker-Dealer Services, Inc. ("SBDS"),
the Trust's administrator and distributor.

The Fund will invest all of its investable assets in The U.S. Fixed Income
Portfolio (the "Portfolio"). The Portfolio is an open-end management investment
company and has the same investment objective and policies as the Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by SFG
Investors or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

The Trust has entered into a Services Agreement with Morgan Guaranty Trust
Company of New York ("Morgan") to provide financial and fund accounting services
and shareholder servicing for the Fund, as described in the accompanying Trust's
registration statement on Form N-lA. The Trust has also entered into separate
administration and distribution agreements with SBDS to provide for
administrative and distribution services for the Fund, as described in such
registration statement. Morgan, Charles Schwab & Co. ("Schwab") and the Trust
are parties to separate services and operating agreements (the "Schwab
Agreements") whereby Schwab makes Fund shares available to customers of
investment advisers and other financial intermediaries who are Schwab's clients.
The financial responsibilities and other obligations of the Fund under the
Schwab Agreements are contingent upon termination of Morgan's Services Agreement
with the Trust. The officers of the Trust are employees of SBDS.

<PAGE>

Report of Independent Accountants

To the Shareholder and Trustees of
The JPM Advisor U.S. Fixed Income Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor U.S.
Fixed Income Fund (one of nine funds comprising The JPM Advisor Funds, hereafter
referred to as the "Fund") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Fund's management; our responsibility is to express an opinion on this
financial statement based on our audit. We conducted our audit of this financial
statement in accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statement is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statement, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR INTERNATIONAL FIXED INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The Non-U.S. Fixed Income Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor International Fixed Income Fund (the "Fund") is a series of The
JPM Advisor Funds, a Massachusetts business trust (the "Trust") organized on
September 16, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sale of 10 shares (the
"initial shares") of the Fund to Signature Financial Group, Inc. ("Signature"),
the parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the
Trust's administrator and distributor.

The Fund will invest all of its investable assets in The Non-U.S. Equity
Portfolio (the "Portfolio"). The Portfolio is an open-end management investment
company and has the same investment objective and policies as the Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor International Fixed Income Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor
International Fixed Income Fund (one of nine funds comprising The JPM Advisor
Funds, hereafter referred to as the "Fund") at March 24, 1995, in conformity
with generally accepted accounting principles. This financial statement is the
responsibility of the Fund's management; our responsibility is to express an
opinion on this financial statement based on our audit. We conducted our audit
of this financial statement in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement, assessing the accounting
principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE NON-U.S. FIXED INCOME PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 6, 1994

ASSETS

Cash $100,100
Deferred Organization Expenses 35,000
--------
Total Assets 135,100

LIABILITIES

Organization Expenses Payable 35,000
--------

Net Assets $100,100
========

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION OF PORTFOLIO

The Non-U.S. Fixed Income Portfolio (the "Portfolio") was organized as a New
York trust on June 16, 1993, and has been inactive since that date except for
matters relating to its organization and registration as an investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), the sales
of beneficial interests at the respective prices of $100 to Signature Financial
Group, Inc. and $100,000 to JPM International Bond Fund, Ltd. (the "initial
beneficial interests").

Morgan Guaranty Trust Company of New York ("Morgan") has agreed to pay the
organization expenses of the Portfolio. The Portfolio has agreed to reimburse
Morgan for these costs which are being amortized by the Portfolio on a
straight-line basis over a sixty-month period from the commencement of
operations. The amount paid by the Portfolio on any decrease or withdrawal by
any current holder of the initial beneficial interests in the Portfolio will be
reduced by the pro rata portion of any unamortized organization expenses which
the amount of the initial beneficial interests of the Portfolio being decreased
bears to the total amount of beneficial interests of the Portfolio held by such
holder immediately prior to such withdrawal.

NOTE 2 - VALUATION OF INVESTORS' BENEFICIAL INTERESTS

At 4:00 p.m. New York time on each business day of the Portfolio, the value of
an investor's beneficial interest in the Portfolio is equal to the product of
(i) the aggregate net asset value of the Portfolio, multiplied by (ii) the
percentage representing that investor's share of the aggregate beneficial
interest in the Portfolio effective for that day.

NOTE 3 - SERVICE AGREEMENT WITH AFFILIATES

The Portfolio has entered into separate Investment Advisory and Financial and
Fund Accounting Services agreements with Morgan as described in the registration
statement of the Portfolio on Form N-1A under the 1940 Act. The Portfolio has
also entered into separate Administration and Exclusive Placement Agent
agreements with Signature Broker-Dealer Services, Inc., and a Fund Services
agreement with Pierpont Group, Inc. as described in such registration statement.
The officers of the Portfolio are employees of Signature Broker-Dealer Services,
Inc. The Trustees of the Portfolio are the sole shareholders of Pierpont Group,
Inc.

<PAGE>

NOTE 4 - SUBSEQUENT EVENT

The Portfolio commenced operations on October 11, 1994. On that date, JPM
International Bond Fund, Ltd. increased its beneficial interest in the Portfolio
by contributing certain assets and liabilities, including securities, with a
value of $112,714,902.
<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Investors and Trustees of
The Non-U.S. Fixed Income Portfolio

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The Non-U.S. Fixed
Income Portfolio (the "Portfolio") at October 6, 1994, in conformity with
generally accepted accounting principles. This financial statement is the
responsibility of the Portfolio's management; our responsibility is to express
an opinion on this financial statement based on our audit. We conducted our
audit of this financial statement in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit provides a seasonable basis for the opinion expressed above.

/S/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
November 1, 1994

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR INTERNATIONAL EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The Non-U.S. Equity Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor International Equity Fund (the "Fund") is a series of The JPM
Advisor Funds, a Massachusetts business trust (the "Trust") organized on
September 16, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sale of 10 shares (the
"initial shares") of the Fund to Signature Financial Group, Inc. ("Signature"),
the parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the
Trust's administrator and distributor.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor International Equity Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor
International Equity Fund (one of nine funds comprising The JPM Advisor Funds,
hereafter referred to as the "Fund") at March 24, 1995, in conformity with
generally accepted accounting principles. This financial statement is the
responsibility of the Fund's management; our responsibility is to express an
opinion on this financial statement based on our audit. We conducted our audit
of this financial statement in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement, assessing the accounting
principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR EMERGING MARKETS EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The Emerging Markets Equity Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor Emerging Markets Equity Fund (the "Fund") is a series of The JPM
Advisor Funds, a Massachusetts business trust (the "Trust") organized on
September 16, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sale of 10 shares (the
"initial shares") of the Fund to Signature Financial Group, Inc. ("Signature"),
the parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the
Trust's administrator and distributor.

The Fund will invest all of its investable assets in The Emerging Markets Equity
Portfolio (the "Portfolio"). The Portfolio is an open-end management investment
company and has the same investment objective and policies as the Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor Emerging Markets Equity Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor
Emerging Markets Equity Fund (one of nine funds comprising The JPM Advisor
Funds, hereafter referred to as the "Fund") at March 24, 1995, in conformity
with generally accepted accounting principles. This financial statement is the
responsibility of the Fund's management; our responsibility is to express an
opinion on this financial statement based on our audit. We conducted our audit
of this financial statement in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement, assessing the accounting
principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR ASIA GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The Asia Growth Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor Asia Growth Fund (the "Fund") is a series of The JPM Advisor
Funds, a Massachusetts business trust (the "Trust") organized on September 16,
1994, and has been inactive since that date except for matters relating to its
organization and registration as an investment company under the Investment
Company Act of 1940, as amended, and the sale of 10 shares (the "initial
shares") of the Fund to Signature Financial Group, Inc. ("Signature"), the
parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the Trust's
administrator and distributor.

The Fund will invest all of its investable assets in The Asia Growth Portfolio
(the "Portfolio"), a series of The Series Portfolio, a trust organized under the
laws of the State of New York. The Portfolio is an open-end management
investment company and has the same investment objective and policies as the
Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor Asia Growth Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor Asia
Growth Fund (one of nine funds comprising The JPM Advisor Funds, hereafter
referred to as the "Fund") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Fund's management; our responsibility is to express an opinion on this
financial statement based on our audit. We conducted our audit of this financial
statement in accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statement is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statement, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>
THE SERIES PORTFOLIO - THE ASIA GROWTH PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Cash $ 200
Deferred Organization Expenses 33,000
Total Assets 33,200
------
LIABILITIES

Organization Expenses Payable 33,000
Total Liabilities 33,000

Commitments and Contingencies (See Note 3) -

Net Assets $ 200
=======

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The Asia Growth Portfolio (the "Portfolio") is a series of The Series Portfolio
(the "Series Portfolio"), a trust organized under the laws of the State of New
York on June 24, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sales of beneficial
interests in the Portfolio in the respective amounts of $100 to The JPM Advisor
Asia Growth Fund (the "Fund") and $100 to JPM Asia Growth Fund, Ltd. (the
"initial beneficial interests").

The Portfolio has incurred $33,000 in organization expenses based on its
allocable pro rata share of total organization expenses for the three Portfolios
in the Series Portfolio. These costs are being deferred and will be amortized on
a straight line basis over a period not to exceed five years beginning with the
commencement of operations of the Portfolio. The Portfolio will receive upon a
redemption by Signature (the purchaser of the Fund's initial shares) from the
Fund, a pro rata portion of the unamortized organization expenses of the
Portfolio. The amount paid by the Portfolio on any withdrawal of an initial
beneficial interest by the Fund, JPM Asia Growth Fund, Ltd. or any other current
holder of such initial beneficial interest will be reduced by a pro rata portion
of any unamortized organization expenses. This reduction will be determined with
respect to each withdrawal of an initial beneficial interest by calculating the
proportion of the amount of the initial beneficial interest withdrawn to the
aggregate initial beneficial interests then outstanding.

NOTE 2 - VALUATION OF INVESTORS' BENEFICIAL INTERESTS

At 4:15 p.m. New York time on each business day of the Portfolio, the value of
an investor's beneficial interest in the Portfolio is equal to the product of
(i) the aggregate net asset value of the Portfolio, effective for that day, and
(ii) the percentage representing that investor's pro rata share of the aggregate
beneficial interests in the Portfolio, on that day.

<PAGE>

NOTE 3 - SERVICE AGREEMENTS WITH AFFILIATES

The Series Portfolio has entered into separate investment advisory and financial
and fund accounting services agreements with Morgan Guaranty Trust Company of
New York ("'Morgan") to provide investment advisory and financial and fund
accounting services for the Portfolio as described in the Series Portfolio's
accompanying registration statement on Form N-lA. The Series Portfolio has also
entered into separate administration and exclusive placement agent agreements
with Signature Broker-Dealer Services, Inc.("SBDS"), to provide for
administrative and placement services for the Portfolio, and a fund services
agreement with Pierpont Group, Inc. ("Pierpont Group"), each as described in
such registration statement. The officers of the Series Portfolio, excluding its
Chief Executive Officer, are employees of SBDS. The Trustees of the Series
Portfolio represent all the existing shareholders of Pierpont Group.

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Investors and Trustees of
The Asia Growth Portfolio

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The Asia Growth
Portfolio (one of three portfolios comprising The Series Portfolio, hereafter
referred to as the "Portfolio") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Portfolio's management; our responsibility is to express an opinion on
this financial statement based on our audit. We conducted our audit of this
financial statement in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statement is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statement, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

/S/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR EUROPEAN EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The U.S. Fixed Income Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor European Equity Fund (the "Fund") is a series of The JPM Advisor
Funds, a Massachusetts business trust (the "Trust") organized on September 16,
1994, and has been inactive since that date except for matters relating to its
organization and registration as an investment company under the Investment
Company Act of 1940, as amended, and the sale of 10 shares (the "initial
shares") of the Fund to Signature Financial Group, Inc. ("Signature"), the
parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the Trust's
administrator and distributor.

The Fund will invest all of its investable assets in The European Equity
Portfolio (the "Portfolio"), a series of The Series Portfolio, a trust organized
under the laws of the State of New York. The Portfolio is an open-end management
investment company and has the same investment objective and policies as the
Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor European Equity Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor
European Equity Fund (one of nine funds comprising The JPM Advisor Funds,
hereafter referred to as the "Fund") at March 24, 1995, in conformity with
generally accepted accounting principles. This financial statement is the
responsibility of the Fund's management; our responsibility is to express an
opinion on this financial statement based on our audit. We conducted our audit
of this financial statement in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement, assessing the accounting
principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE SERIES PORTFOLIO - THE EUROPEAN EQUITY PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Cash $ 200
Deferred Organization Expenses 33,000
Total Assets 33,200
------
LIABILITIES

Organization Expenses Payable 33,000
Total Liabilities 33,000

Commitments and Contingencies (See Note 3) -

Net Assets $ 200
=======

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The European Equity Portfolio (the "Portfolio") is a series of The Series
Portfolio (the "Series Portfolio"), a trust organized under the laws of the
State of New York on June 24, 1994, and has been inactive since that date except
for matters relating to its organization and registration as an investment
company under the Investment Company Act of 1940, as amended, and the sales of
beneficial interests in the Portfolio in the respective amounts of $100 to The
JPM Advisor European Equity Fund (the "Fund") and $100 to JPM Europe Fund, Ltd.
(the "initial beneficial interests").

The Portfolio has incurred $33,000 in organization expenses based on its
allocable pro rata share of total organization expenses for the three Portfolios
in the Series Portfolio. These costs are being deferred and will be amortized on
a straight line basis over a period not to exceed five years beginning with the
commencement of operations of the Portfolio. The Portfolio will receive upon a
redemption by Signature (the purchaser of the Fund's initial shares) from the
Fund, a pro rata portion of the unamortized organization expenses of the
Portfolio. The amount paid by the Portfolio on any withdrawal of an initial
beneficial interest by the Fund, JPM Europe Fund, Ltd. or any other current
holder of such initial beneficial interests will be reduced by a pro rata
portion of any unamortized organization expenses. This reduction will be
determined with respect to each withdrawal of an initial beneficial interest by
calculating the proportion of the amount of the initial beneficial interest
withdrawn to the aggregate initial beneficial interests then outstanding.

NOTE 2 - VALUATION OF INVESTORS' BENEFICIAL INTERESTS

<PAGE>

NOTE 3 - SERVICE AGREEMENTS WITH AFFILIATES

The Series Portfolio has entered into separate investment advisory and financial
and fund accounting services agreements with Morgan Guaranty Trust Company of
New York ("Morgan") to provide investment advisory and financial and fund
accounting services for the Portfolio as described in the Series Portfolio's
accompanying registration statement on Form N-lA. The Series Portfolio has also
entered into separate administration and exclusive placement agent agreements
with Signature Broker-Dealer Services, Inc. ("SBDS"), to provide for
administrative and placement services for the Portfolio, and a fund services
agreement with Pierpont Group, Inc. ("Pierpont Group"), each as described in
such registration statement. The officers of the Series Portfolio, excluding its
Chief Executive Officer, are employees of SBDS. The Trustees of the Series
Portfolio represent all the existing shareholders of Pierpont Group.

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Investors and Trustees of
The European Equity Portfolio

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The European Equity
Portfolio (one of three portfolios comprising The Series Portfolio, hereafter
referred to as the "Portfolio") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Portfolio's management; our responsibility is to express an opinion on
this financial statement based on our audit. We conducted our audit of this
financial statement in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statement is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statement, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

/S/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

THE JPM ADVISOR FUNDS - THE JPM ADVISOR JAPAN EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Investment in The U.S. Fixed Income Portfolio $ 100
Deferred Organization Expenses 58,000
------
Total Assets 58,000

LIABILITIES

Organization Expenses Payable 58,000
Total Liabilities 58,000

COMMITMENTS AND CONTINGENCIES (SEE NOTE 2) -

Net Assets 100

Net Asset Value Per Share (10,000 shares of beneficial
interest outstanding; unlimited authorized shares of
beneficial interest of $0.001 par value), Offering and
Redemption Price $10.00

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The JPM Advisor Japan Equity Fund (the "Fund") is a series of The JPM Advisor
Funds, a Massachusetts business trust (the "Trust") organized on September 16,
1994, and has been inactive since that date except for matters relating to its
organization and registration as an investment company under the Investment
Company Act of 1940, as amended, and the sale of 10 shares (the "initial
shares") of the Fund to Signature Financial Group, Inc. ("Signature"), the
parent company of Signature Broker-Dealer Services, Inc. ("SBDS"), the Trust's
administrator and distributor.

The Fund will invest all of its investable assets in The Japan Equity Portfolio
(the "Portfolio"), a series of The Series Portfolio, a trust organized under the
laws of the State of New York. The Portfolio is an open-end management
investment company and has the same investment objective and policies as the
Fund.

The Fund has incurred $58,000 in organization expenses based on its allocable
pro rata share of total organization expenses for the nine funds in the Trust.
These costs are being deferred and will be amortized on a straight line basis
over a period not to exceed five years beginning with the commencement of
operations of the Fund. The amount paid by the Fund on any redemption by
Signature or any other current holder of the Fund's initial shares will be
reduced by the pro rata portion of any unamortized organization expenses of the
Fund which the number of initial shares redeemed bears to the total number of
initial shares outstanding immediately prior to such redemption.

<PAGE>

NOTE 2 - SERVICE AGREEMENTS WITH AFFILIATES

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholder and Trustees of
The JPM Advisor Japan Equity Fund

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The JPM Advisor
Japan Equity Fund (one of nine funds comprising The JPM Advisor Funds, hereafter
referred to as the "Fund") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Fund's management; our responsibility is to express an opinion on this
financial statement based on our audit. We conducted our audit of this financial
statement in accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statement is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statement, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995
<PAGE>

THE SERIES PORTFOLIO - THE JAPAN EQUITY PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
MARCH 24, 1995

ASSETS

Cash $ 100,100
Deferred Organization Expenses 33,000
------
Total Assets 133,100

LIABILITIES

Organization Expenses Payable 33,000
Total Liabilities 33,000

Commitments and Contingencies (See Note 3) -

Net Assets $ 100,100
=========

NOTES TO FINANCIAL STATEMENT

NOTE 1 - ORGANIZATION

The Japan Equity Portfolio (the "Portfolio") is a series of The Series Portfolio
(the "Series Portfolio"), a trust organized under the laws of the State of New
York on June 24, 1994, and has been inactive since that date except for matters
relating to its organization and registration as an investment company under the
Investment Company Act of 1940, as amended, and the sales of beneficial
interests in the Portfolio in the respective amounts of $100 to The JPM Advisor
Japan Equity Fund (the "Fund") and $100,000 to JPM Japan Equity Fund, Ltd. (the
"initial beneficial interests").

The Portfolio has incurred $33,000 in organization expenses based on its
allocable pro rata share of total organization expenses for the three Portfolios
in the Series Portfolio. These costs are being deferred and will be amortized on
a straight line basis over a period not to exceed five years beginning with the
commencement of operations of the Portfolio. The Portfolio will receive upon a
redemption by Signature (the purchaser of the Fund's initial shares) from the
Fund, a pro rata portion of the unamortized organization expenses of the
Portfolio. The amount paid by the Portfolio on any withdrawal of an initial
beneficial by the Fund, JPM Japan Equity Fund, Ltd. or any other current holder
of such initial beneficial interests be reduced by a pro rata portion of any
unamortized organization expenses. This reduction will be determined with
respect to each withdrawal of an initial beneficial interest by calculating the
proportion of the amount of the initial beneficial interest withdrawn to the
aggregate initial beneficial interests then outstanding.

NOTE 2 - VALUATION OF INVESTORS' BENEFICIAL INTEREST

<PAGE>

NOTE 3 - SERVICE AGREEMENTS WITH AFFILIATES

The Series Portfolio has entered into separate investment advisory and financial
and fund accounting services agreements with Morgan Guaranty Trust Company of
New York ("Morgan") to provide investment advisory and financial and fund
accounting services for the Portfolio, as described in the Series Portfolio's
accompanying registration statement on Form N-lA. The Series Portfolio has also
entered into separate administration and exclusive placement agent agreements
with Signature Broker-Dealer Services, Inc.("SBDS"), to provide for
administrative and placement services for the Portfolio, and a fund services
agreement with Pierpont Group, Inc. ("Pierpont Group"), each as described in
such registration statement. The officers of the Series Portfolio, excluding its
Chief Executive Officer, are employees of SBDS. The Trustees of the Series
Portfolio represent all the existing shareholders of Pierpont Group.

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Investors and Trustees of
The Japan Equity Portfolio

In our opinion, the accompanying statement of assets and liabilities presents
fairly, in all material respects, the financial position of The Japan Equity
Portfolio (one of three portfolios comprising The Series Portfolio, hereafter
referred to as the "Portfolio") at March 24, 1995, in conformity with generally
accepted accounting principles. This financial statement is the responsibility
of the Portfolio's management; our responsibility is to express an opinion on
this financial statement based on our audit. We conducted our audit of this
financial statement in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statement is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statement, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above.

/S/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
March 24, 1995

<PAGE>

APPENDIX A
DESCRIPTION OF SECURITY RATINGS

STANDARD & POOR'S

CORPORATE AND MUNICIPAL BONDS

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

AA - Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in a small degree.

A - Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB - Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.

BB - Debt rated BB is regarded as having less near-term vulnerability to default
than other speculative issues. However, it faces major ongoing uncertainties or
exposure to adverse business, financial or economic conditions which could lead
to inadequate capacity to meet timely interest and principal payments.

COMMERCIAL PAPER, INCLUDING TAX EXEMPT

A - Issues assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are further refined with
the designations 1, 2, and 3 to indicate the relative degree of safety.

A-1 - This designation indicates that the degree of safety regarding timely
payment is very strong.

SHORT-TERM TAX-EXEMPT NOTES

SP-1 - The short-term tax-exempt note rating of SP-1 is the highest rating
assigned by Standard & Poor's and has a very strong or strong capacity to pay
principal and interest. Those issues determined to possess overwhelming safety
characteristics are given a "plus" (+) designation.

SP-2 - The short-term tax-exempt note rating of SP-2 has a satisfactory capacity
to pay principal and interest.

A-1

<PAGE>

MOODY'S

CORPORATE AND MUNICIPAL BONDS

Aaa - Bonds which 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.

Aa - Bonds which 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 or 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 which 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 which 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.

Ba - Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well-assured. Often the protection of interest
and principal payments may be very moderate, and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

COMMERCIAL PAPER, INCLUDING TAX EXEMPT

Prime-1 - Issuers rated Prime-1 (or related supporting institutions) have a
superior capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following characteristics:

- - Leading market positions in well established industries.
- - High rates of return on funds employed.
- - Conservative capitalization structures with moderate reliance on debt and
ample asset protection. - Broad margins in earnings coverage of fixed financial
charges and high internal cash generation. - Well established access to a range
of financial markets and assured sources of alternate liquidity.

A-2

<PAGE>

SHORT-TERM TAX EXEMPT NOTES

MIG-1 - The short-term tax-exempt note rating MIG-1 is the highest rating
assigned by Moody's for notes judged to be the best quality. Notes with this
rating enjoy strong protection from established cash flows of funds for their
servicing or from established and broad-based access to the market for
refinancing, or both.

MIG-2 - MIG-2 rated notes are of high quality but with margins of protection not
as large as MIG-1.

A-3

<PAGE>

APPENDIX B
INVESTING IN JAPAN AND ASIAN GROWTH MARKETS

JAPAN AND ITS SECURITIES MARKETS

The Japan Equity Portfolio will be subject to general economic and
political conditions in Japan. These include future political and economic
developments, the possible imposition of, or changes in, exchange controls or
other Japanese governmental laws or restrictions applicable to such investments,
diplomatic developments, political or social unrest and natural disasters.

The information set forth in this section has been extracted from
various governmental publications and private news services.
The Japan Equity Portfolio makes no representation as to the accuracy of the
information, nor has the Portfolio attempted to verify it. Furthermore, no
representation is made that any correlation exists between Japan or its economy
in general and the performance of the Japan Equity Portfolio.

DOMESTIC POLITICS

Japan has a parliamentary form of government. The legislative power is
vested in the Japanese Diet, which consists of a House of Representatives and a
House of Councillors. Members of the House of Representatives are elected for
terms of four years unless the House of Representatives is dissolved prior to
the expiration of their full elected terms. Members of the House of Councillors
are elected for terms of six years with one-half of the membership being elected
every three years. Various political parties are represented in the Diet,
including the conservative Liberal Democratic Party ("LDP"), which until August
1993 had been in power nationally since its formation in 1955. The LDP ceased to
have a majority of the House of Representatives in June 1993, when certain
members of the House of Representatives left the LDP and formed two new
political parties. After an election for the House of Representatives was held
on July 18, 1993 and the LDP failed to secure a majority, seven parties formed a
coalition to control the House of Representatives and chose Morihiro Hosokawa,
the Representative of the Japan New Party, to head their coalition. In April
1994, amid accusations of financial improprieties, Prime Minister Hosokawa
announced that he would resign. Tusutomu Hata succeeded Mr. Hosokawa as prime
minister and formed a new cabinet as a minority coalition government. In June
1994 Mr. Hata yielded to political pressure from opposition parties and
resigned. He was succeeded by Social Democratic Party leader Tomi-ichi Murayama,
Japan's first Socialist prime minister since 1948, who was chosen by a new and
unstable alliance between left-wing and conservative parties, including the LDP.
This political instability may hamper Japan's ability to establish and maintain
effective economic and fiscal policies, and recent and future political
developments may lead to changes in policy that might adversely affect the Japan
Equity Portfolio.

B-1

<PAGE>

ECONOMIC BACKGROUND

Over the past 30 years, Japan has experienced significant economic
development. During the era of high economic growth in the 1960s and early
1970s, the expansion was based on the development of heavy industries such as
steel and shipbuilding. In the 1970s, Japan moved into assembly industries which
employ high levels of technology and consume relatively low quantities of
resources, and since then has become a major producer of electrical and
electronic products and automobiles. Moreover, since the mid-1980s, Japan has
become a major creditor nation. With the exception of the periods associated
with the oil crises of the 1970s, Japan has generally experienced very low
levels of inflation.

Japan is largely dependent upon foreign economies for raw materials.
For instance, almost all of its oil is imported, the majority from the Middle
East. Oil prices therefore have a major impact on the domestic economy, as is
evidenced by the current account deficits triggered by the two oil crises of the
1970s. Oil prices have declined mainly due to a worldwide easing of demand for
crude oil. The stabilized price of oil contributed to Japan's sizeable current
account surplus and stability of wholesale and consumer prices during the period
1981 through 1992. While Japan is working to reduce its dependence on foreign
materials, its lack of natural resources poses a significant obstacle to this
effort.

International trade is important to Japan's economy, as exports provide
the means to pay for many of the raw materials it must import. Japan's trade
surplus has increased dramatically in recent years, exceeding $100 billion since
1991. Because of the concentration of Japanese exports in highly visible
products such as automobiles, machine tools and semiconductors, and the large
trade surpluses resulting therefrom, Japan has entered a tense phase in its
relations with its trading partners, particularly with respect to the United
States, with whom the trade imbalance is the greatest. The United States and
Japan have engaged in "economic framework" negotiations to help increase the
United States' share in Japanese markets and reduce Japan's current account
surplus, but progress in the negotiations has been hampered by the recent
political upheaval in Japan. Any trade sanctions imposed upon Japan by the
United States as a result of the current friction or otherwise could adversely
affect Japan and the performance of the Japan Equity Portfolio.

B-2

<PAGE>

The following table sets forth the composition of Japan's trade
balance, as well as other components of its current account, for the years 1980
to 1993.

CURRENT ACCOUNT

Trade
-----------------------------------------------------------------------------------
Change from Change from
PRECEDING PRECEDING TRADE Current
YEAR EXPORTS YEAR IMPORTS YEAR BALANCE SERVICE TRANSFERS BALANCE
(U.S. DOLLARS IN
MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>

1980 $ 126,736 25.2% $ 124,611 25.4% $ 2,125 $ (11,343) $ (1,528) $ (10,746)

1981 149,522 18.0 129,555 4.0 19,967 (1,624) 4,770
(13,573)
1982 137,663 (7.9) 119,584 (7.7) 18,079 (9,848) 6,850
(1,381)
1983 145,468 5.7 114,014 (4.7) 31,454 (9,106) (1,549) 20,799

1984 168,290 15.7 124,003 8.8 44,257 (7,747) (1,507) 35,003

1985 174,015 3.4 118,029 (4.8) 55,986 (5,165) (1,652) 49,169

1986 205,591 18.1 112,764 (4.5) (4,932) (2,050) 85,845 92,827

1987 224,605 9.2 128,219 13.7 96,386 (5,702) 87,015 (3,669)

1988 259,765 15.7 164,753 28.5 95,012 (11,263) (4,118) 79,631

1989 269,570 3.8 192,653 16.9 76,917 (15,526) (4,234) 57,157

1990 280,374 4.0 216,846 12.6 65,528 (22,292) (5,475) 35,761

1991 306,557 9.3 203,513 (6.1) 103,044 (17,660) (12,483) 72,901

1992 330,850 7.9 198,502 (2.5) 132,348 (10,112) (4,685) 117,551

1993 351,292 6.2 209,778 5.7 141,514 (6,117) 131,448 (3,949)

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-3

<PAGE>

The following table sets forth the composition of Japan's imports on a
customs clearance basis, both in terms of import item and in terms of regional
source, for the years 1980 to 1993.

IMPORTS ON A CUSTOMS CLEARANCE BASIS

Crude
Materials Machinery and From From
YEAR TOTAL AND FUELS FOODSTUFF EQUIPMENT U.S. EUROPE FROM ASIA
- ---- ----- --------- --------- --------- ---- ------ ---------

(U.S. DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>

1980 $140,528 $93,752 $14,666 $ 9,843 $24,408 $7,842 $31,751

1981 143,290 92,597 15,913 10,240 25,927 8,552 31,930

1982 131,931 84,529 14,575 9,112 24,179 7,560 29,985

1983 126,393 77,136 14,896 10,409 24,647 8,120 27,988

1984 136,503 79,862 16,027 12,066 26,862 9,334 31,883

1985 129,539 73,834 15,547 12,372 25,793 8,893 30,264

1986 126,408 54,423 19,186 14,699 29,054 13,989 29,849

1987 149,515 61,122 22,395 19,123 31,490 17,670 38,627

1988 187,354 66,330 29,120 26,661 42,037 24,071 47,802

1989 210,847 73,649 31,012 32,376 48,246 28,146 61,476

1990 234,799 85,102 31,572 40,863 52,369 35,028 66,646

1991 236,737 81,807 34,473 42,851 53,317 31,792 73,016

1992 233,021 78,734 37,289 42,853 52,230 31,280 74,448

1993 240,670 76,072 39,365 46,612 55,197 30,142 81,060

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-4

<PAGE>

ECONOMIC TRENDS. The following table sets forth Japan's gross domestic
product for the years 1987 to 1993.
<TABLE>
<CAPTION>

GROSS DOMESTIC PRODUCT (GDP)

1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ----

(YEN IN BILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>

Consumption
Expenditures

Private (Y)270,505.4 (Y)264,779.9 (Y)255,084.2 (Y)243,628.1 (Y)228,483.2 (Y)215,122.0 (Y)204,585.3
Government 44,970.3 43,254.0 41,232.0 38,806.6 36,274.8 34,184.3 32,974.5
Capital Formation
(incl.inventories)

Private 102,047.7 109,579.2 116,638.0 110,871.9 100,130.8 89,043.7 76,176.5

Government 40,328.3 35,013.4 30,062.3 28,182.6 25,724.5 24,660.89 23,673.8
Exports of Goods
and Services 44,234.5 47,409.4 46,809.7 45,919.9 42,351.8 37,483.2 36,209.6
Imports of Goods
and Services 33,317.2 36,183.8 38,529.3 42,871.8 36,768.1 29,065.1 25,194.9
GDP
(Expenditures) 468,769.0 463,850.0 451,296.9 24,537.2 396,197.0 371,429.0 348,425.0
Change in GDP from Preceding Year
Nominal
terms 1.1% 2.8% 6.3% 7.2% 6.7% 6.6% 4.1%
Real Terms 0.1% 1.1% 4.3% 4.8% 4.7% 6.2% 4.1%

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

The following tables set forth certain economic indicators in Japan for
the years indicated.
<TABLE>
<CAPTION>

ORDERS RECEIVED FOR MACHINERY
(280 COMPANIES)

1993 1992 1991 1990 1989 1988
---- ---- ---- ---- ---- ----
(YEN IN BILLIONS)
<S> <C> <C> <C> <C> <C> <C>

Manufacturing................. (Y)4,657.7 (Y)5,526.1 (Y)6,785.9 (Y)7,289.3 (Y)6,663.1 (Y)5,621.3

Nonmanufacturing.............. 8,858.8 9,233.9 10,160.4 9,139.4 8,425.9 7,066.5
-------- ------- -------- ------- ------- -------

Total Demand by Private
Sector...................... (Y)13,516.5 (Y)14,759.9 (Y)16,946.3 (Y)16,429.3 (Y)15,088.9 (Y)12,687.8

Government Demand............. 11,226.7 11,010.7 11,291.3 11,601.2 10,316.4 9,131.4
-------- -------- -------- -------- -------- --------

Total......................... (Y)24,743.2 (Y)25,770.6 (Y)28,237.6 (Y)28,030.5 (Y)25,405.3 (Y)21,819.2
----------- ----------- ----------- ----------- ----------- -----------

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-5

<PAGE>

NEW DWELLING CONSTRUCTION STARTED

YEAR NUMBER FLOOR AREA
(UNITS IN THOUSANDS) (SQUARE METERS IN THOUSANDS)
<S> <C> <C>

1980 1,269 119,102
1981 1,152 107,853
1982 1,146 107,638

1983 1,137 99,442
1984 1,187 100,226
1985 1,236 103,129
1986 1,365 111,003

1987 1,674 132,527
1988 1,685 134,530
1989 1,663 135,029
1990 1,707 137,490

1991 1,370 117,219
1992 1,403 120,318
1993 1,486 131,683

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.
<TABLE>
<CAPTION>

UNEMPLOYMENT
Labor Productivity Index
YEAR NUMBER UNEMPLOYED PERCENT UNEMPLOYED (MANUFACTURING)
(IN MILLIONS) (BASE YEAR 1990)
<S> <C> <C> <C>

1983 1.56 2.6% 66.7
1984 1.61 2.7 72.4
1985 1.56 2.6 75.6
1986 1.67 2.8 77.0
1987 1.73 2.8 81.4
1988 1.55 2.5 90.8
1989 1.42 2.3 96.2
1990 1.34 2.1 100.0
1991 1.36 2.1 102.5
1992 1.42 2.2 97.0
1993 1.66 2.5 95.4

</TABLE>

Source: Financial Statistics of Japan 1993 (1993 ed. and June 1994 supp.),
Institute of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-6

<PAGE>

WHOLESALE PRICE INDEX

Change
All from Manu- Farm and
Commodi- Preced- factured Marine Mineral Domestic
YEAR TIES ING YEAR PRODUCTS PRODUCTS PRODUCTS UTILITIES PRODUCTS EXPORTS IMPORTS
---- ------ -------- -------- -------- -------- --------- -------- ------- -------

(BASE YEAR: 1990)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>

1980 110.9 17.7% 108.2 116.0 170.4 109.7 104.8 121.5 159.8

1981 112.5 1.4 109.0 114.1 185.5 121.1 106.2 122.9 162.4

1982 114.5 1.8 110.2 114.4 204.1 122.7 106.7 127.7 175.2

1983 111.9 (2.3) 108.6 113.6 180.9 106.0 120.0 161.3
122.9
1984 111.6 (2.7) 108.5 114.1 172.7 124.0 106.1 120.8 156.0

1985 110.4 (1.1) 107.4 109.4 173.6 124.4 105.3 119.1 152.2

1986 100.3 99.7 99.5 97.9 118.5 100.3 101.1 97.7 (9.1)

1987 96.5 (3.8) 96.4 94.9 110.8 97.2 96.0 89.7 88.2

1988 95.6 (0.9) 95.8 95.4 79.2 104.4 96.7 93.8 85.6

1989 98.0 2.5 98.2 98.3 87.1 100.8 98.5 97.9 92.0

1990 100.0 2.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

1991 99.4 (0.6) 99.8 97.5 93.6 100.1 94.6 91.8 101.0

1992 97.8 (1.6) 98.3 96.2 88.2 100.1 100.1 91.2 86.3

1993 (2.9) 95.5 95.1 76.8 100.2 98.6 83.9 77.3 95.0

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-7

<PAGE>

CONSUMER PRICE INDEX

General
Change from Including
YEAR GENERAL PRECEDING YEAR FRESH FOOD

(Base Year: 1990)
<S> <C> <C> <C>

1980 81.7 7.7% 81.8

1981 85.6 4.9 85.7

1982 88.0 2.8 88.3

1983 89.6 1.9 89.9

1984 91.7 2.3 91.9

1985 93.5 2.0 93.7

1986 94.1 0.6 94.5

1987 94.2 0.1 94.8

1988 94.9 0.7 95.1

1989 97.0 2.3 97.4

1990 100.0 3.1 100.0

1991 103.3 3.3 102.9

1992 105.0 1.6 105.2

1993 106.4 1.3 106.6

</TABLE>

Source: Financial Statistics of Japan (1993 ed. and June 1994 supp.), Institute
of Fiscal and Monetary Policy, Ministry of Finance of Japan.

B-8

<PAGE>

CURRENCY FLUCTUATION. The Japan Equity Portfolio's investments in
Japanese securities will be denominated in yen and most income received by the
Portfolio from such investments will be in yen. However, the Portfolio's net
asset value will be reported, and distributions will be made, in U.S. dollars.
Therefore, a decline in the value of the yen relative to the U.S. dollar could
have an adverse effect on the value of the Portfolio's Japanese investments.

The following table sets forth the average exchange rates of Japanese
yen for U.S. dollars for the years 1980 to 1993:

CURRENCY EXCHANGE RATES

YEAR YEN PER U.S. DOLLAR
<S> <C>

1980 (Y)226.63

1981 220.63

1982 249.06

1983 237.55

1984 237.45

1985 238.47

1986 168.35

1987 144.60

1988 128.17

1989 138.07

1990 145.00

1991 134.59

1992 126.79

1993 111.08

</TABLE>

Source: Board of Governors of the Federal Reserve System, Federal Reserve
Bulletin

On March 25, 1995, the noon buying rate in London for cable transfers
payable in Japanese yen was 89.00 yen per U.S. dollar. The recent relative
strength of the yen to the U.S. dollar may adversely affect the economy of
Japan, and, in particular, the export sector thereof.

GEOLOGICAL FACTORS. The islands of Japan lie in the western Pacific
Ocean, off the eastern coast of the continent of Asia. Japan has in the past
experienced earthquakes and tidal waves of varying degrees of severity, and the
risks of such phenomena, and damage resulting therefrom, continue to exist.

B-9

<PAGE>

SECURITIES MARKETS

There are eight stock exchanges in Japan. Of these, the Tokyo Stock
Exchange is by far the largest, followed by the Osaka Stock Exchange and the
Nagoya Stock Exchange. These exchanges divide the market for domestic stocks
into two sections, with newly listed companies and smaller companies assigned to
the Second Section and largest companies assigned to the First Section.

The following table sets forth the number of Japanese companies listed
on each of the eight Japanese stock exchanges as of the end of 1993.
<TABLE>
<CAPTION>

NUMBER OF DOMESTIC COMPANIES LISTED ON ALL STOCK EXCHANGES

TOKYO OSAKA NAGOYA

1st 2nd 1st 2nd 1st 2nd
SEC. SEC. SEC. SEC. SEC. SEC. KYOTO HIROSHIMA FUKUOKA NIGATA SAPPORO
- --- --- --- --- --- --- ----- --------- ------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>

1,234 433 857 321 432 127 237 198 252 197 191

</TABLE>

Source: Tokyo Stock Exchange, Fact Book 1994

The following table sets forth the trading volume and value of Japanese
stocks on each of the eight Japanese stock exchanges for the years 1989 to 1993.
<TABLE>
<CAPTION>

STOCK TRADING VOLUME & VALUE ON ALL STOCK EXCHANGES
(shares in millions; yen in billions)

ALL EXCHANGES TOKYO OSAKA
NAGOYA

YEAR VOLUME VALUE VOLUME VALUE VOLUME VALUE VOLUME VALUE
- ---- -------- --------- ---------- --------- ---------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C>

1989 ........ 256,296 (Y)386,395 222,599 (Y)332,617 25,096 (Y)41,679 7,263 (Y)10,395

1990 ........ 145,837 231,837 123,099 186,667 17,187 35,813 4,323 7,301

1991 ........ 107,844 134,160 93,606 110,897 10,998 18,723 2,479 3,586

1992 ........ 82,563 80,456 66,408 60,110 12,069 15,575 3,300 3,876

1993 ........ 101,172 106,123 86,934 86,889 10,439 14,635 2,779 3,459

</TABLE>
<TABLE>
<CAPTION>

KYOTO HIROSHIMA FUKUOKA NIIGATA SAPPORO

VOLUME VALUE VOLUME VALUE VOLUME VALUE VOLUME VALUE VOLUME VALUE
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>

1989 ................. 331 (Y)443 190 (Y)235 268 (Y)330 398 (Y)475 151 (Y)221

1990 ................. 416 770 169 261 203 245 334 195 286 405

1991 ................. 220 300 125 149 122 174 181 208 113 123

1992 ................. 225 110 136 139 129 163 178 149 129 322

1993 ................. 222 340 185 178 229 225 206 226 173 170

</TABLE>

Source: Tokyo Stock Exchange, Fact Book 1994

B-10

<PAGE>

The following table sets forth the stock trading volume of Japanese
stocks on the Tokyo Stock Exchange for the years 1971 to 1993.
<TABLE>
<CAPTION>

TOKYO STOCK EXCHANGE
STOCK TRADING VOLUME

No. of
Trading Daily Turnover
YEAR DAYS TOTAL AVERAGE HIGH LOW RATIO
- ---- ------ ----- ------- ---- --- -----

(shares in millions)

1971............. 299 60,819 203 559 60 51.4%

1972............. 297 100,358 338 1,077 92 79.0

1973............. 287 59,248 206 1,066 48 43.0

1974............. 285 51,001 179 572 48 34.4

1975............. 284 51,906 183 401 62 32.6

1976............. 286 69,941 245 646 91 40.9

1977............. 286 71,195 249 921 102 39.4

1978............. 285 98,555 345 865 149 52.1

1979............. 286 98,246 344 914 138 50.2

1980............. 285 102,245 359 940 141 50.2

1981............. 285 107,549 377 1,390 114 50.0

1982............. 285 78,474 275 823 108 34.6

1983............. 286 104,309 365 997 122 44.3

1984............. 287 103,737 361 965 124 42.5

1985............. 285 121,863 428 1,367 163 48.0

1986............. 279 197,699 709 2,336 141 75.1

1987............. 274 263,611 962 2,839 211 96.1

1988............. 273 282,637 1,035 2,868 187 98.1

1989............. 249 222,599 894 2,212 276 73.1

1990............. 246 123,099 500 1,101 196 38.4

1991............. 246 93,606 381 1,462 138 28.4

1992............. 247 66,408 269 841 116 19.9

1993............. 246 86,935 353 1,553 82 25.9

</TABLE>

Source: Tokyo Stock Exchange, Fact Book 1994

B-11

<PAGE>

The following table sets forth the stock trading value of Japanese
stocks on the Tokyo Stock Exchange for the years 1971 to 1993.
<TABLE>
<CAPTION>

TOKYO STOCK EXCHANGE
STOCK TRADING VALUE

Turnover
YEAR TOTAL DAILY AVERAGE HIGH LOW RATIO

(yen in millions)
<S> <C> <C> <C> <C> <C>

1971................................... (Y)13,980,301 (Y)46,757 (Y)131,339 (Y)10,734 71.8%

1972................................... 21,435,235 72,173 202,347 18,951 60.6

1973................................... 14,904,472 51,932 253,353 11,834 34.4

1974................................... 12,390,319 43,475 137,534 11,455 33.2

1975................................... 15,566,058 54,810 154,217 14,261 39.3

1976................................... 23,662,168 82,735 216,984 28,945 49.2

1977................................... 21,500,060 75,175 193,945 30,497 41.1

1978................................... 32,534,301 144,155 265,158 45,010 55.2

1979................................... 34,911,285 122,067 305,407 44,292 51.5

1980................................... 36,489,558 128,034 247,596 53,714 49.9

1981................................... 49,364,571 173,209 472,362 50,288 53.4

1982................................... 36,571,457 128,320 579,505 48,401 38.5

1983................................... 54,844,791 191,765 496,110 67,825 48.8

1984................................... 67,974,003 236,843 575,562 83,682 47.1

1985................................... 78,711,048 276,179 727,316 110,512 44.7

1986................................... 159,836,218 572,890 1,682,060 115,244 67.2

1987................................... 250,736,971 915,098 2,382,114 221,230 80.6

1988................................... 285,521,260 1,045,865 2,768,810 192,704 70.2

1989................................... 332,616,597 1,335,810 2,796,946 392,347 61.1

1990................................... 186,666,820 758,808 1,464,920 218,205 57.7

1991................................... 110,897,491 450,803 1,531,064 151,565 19.3

1992................................... 60,110,391 243,362 686,737 97,616 18.0

1993................................... 86,889,072 353,208 1,422,760 61,747 18.3

</TABLE>

Source: Tokyo Stock Exchange, Fact Book 1994

B-12

<PAGE>

SECURITIES INDEX. The TOPIX is a composite index of all common stocks
listed on the First Section of the Tokyo Stock Exchange. The TOPIX reflects the
change in the aggregate market value of the common stocks as compared to the
aggregate market value of those stocks as of the close of January 4, 1968.

The following table sets forth the high, low and year-end TOPIX for
each year from 1971 to 1993.
<TABLE>
<CAPTION>

TOPIX (TOKYO STOCK PRICE INDEX)

(Jan. 4, 1968 = 100)

YEAR YEAR-END HIGH LOW
<S> <C> <C> <C>

1971 199.45 209.00 148.05
1972 401.70 401.70 199.93
1973 306.44 422.48 284.69
1974 278.34 342.47 251.96
1975 323.43 333.11 268.24

1976 383.88 383.88 326.28
1977 364.08 390.93 350.49
1978 449.55 452.60 364.04
1979 459.61 465.24 435.13
1980 494.10 497.96 449.01

1981 570.31 603.92 495.79
1982 593.72 593.72 511.52
1983 731.82 731.82 574.51
1984 913.37 913.37 735.45
1985 1,049.40 1,058.35 916.93

1986 1,556.37 1,583.35 1,025.85
1987 1,725.83 2,258.56 1,557.46
1988 2,357.03 2,357.03 1,690.44
1989 2,881.37 2,884.80 2,364.33
1990 1,733.83 2,867.70 1,523.43

1991 1,714.68 2,028.85 1,638.06
1992 1,307.66 1,763.43 1,102.50
1993 1,439.31 1,698.67 1,250.06

</TABLE>

Source: Tokyo Stock Exchange, Fact Book 1994

B-13

<PAGE>

As this index reflects, share prices of companies traded on Japanese
stock exchanges reached historical peaks (which were later referred to as the
"bubble") in 1989 and 1990. Afterwards stock prices decreased significantly,
reaching their lowest levels in the second half of 1992. There can be no
assurance that additional market corrections will not occur.

ASIAN GROWTH MARKETS

The Asia Growth Portfolio will be subject to certain risks and special
considerations, including those set forth below, which are not typically
associated with investing in securities of U.S. companies. In particular,
securities markets in Asian growth markets have been subject to substantial
price volatility, often without warning. This potential for sudden market
declines should be weighed and balanced against the potential for rapid growth
in Asian growth markets. Further, certain securities that the Portfolio may
purchase, and investment techniques in which the Portfolio may engage, involve
risks, including those set forth below.

INVESTMENT AND REPATRIATION RESTRICTIONS

Foreign investment in the securities markets of several Asian growth
markets is restricted or controlled to varying degrees. These restrictions may
limit investment in certain of the Asian growth markets and may increase
expenses of the Portfolio. For example, certain countries may require
governmental approval prior to investments by foreign persons in a particular
company or industry sector or limit investment by foreign persons to only a
specific class of securities of a company which may have less advantageous terms
(including price) than securities of the company available for purchase by
nationals. Certain countries may restrict or prohibit investment opportunities
in issuers or industries deemed important to national interests. In addition,
the repatriation of both investment income and capital from several of the Asian
growth markets is subject to restrictions such as the need for certain
government consents. Even where there is no outright restriction on repatriation
of capital, the mechanics of repatriation may affect certain aspects of the
operation of the Portfolio. For example, Taiwan imposes a waiting period on the
repatriation of investment capital for certain foreign investors. Although these
restrictions may in the future make it undesirable to invest in the countries to
which they apply, the Advisor does not believe that any current repatriation
restrictions would preclude the Portfolio from effectively managing its assets.

If, because of restrictions on repatriation or conversion, the
Portfolio were unable to distribute substantially all of its net investment
income and long-term capital gains within applicable time periods, the Portfolio
could be subject to U.S. Federal income and excise taxes which would not
otherwise be incurred and may cease to qualify for the favorable tax treatment
afforded to regulated investment companies under the Code, in which case it
would become subject to U.S. federal income tax on all of its income and gains.

Generally, there are restrictions on foreign investment in certain
Asian growth markets, although these restrictions vary in form and content. In
India, Indonesia, Korea, Malaysia, the Philippines, Singapore and Thailand, the
Portfolio may be limited by government regulation or a company's charter to a
maximum percentage of equity ownership in any one company. The Advisor intends
to apply

B-14

<PAGE>

for approval from Indian governmental authorities to invest in India on
behalf of the Portfolio as a foreign institutional investor (an "FII"). The
Advisor expects to receive the necessary approvals from these authorities within
three months from the date of this Prospectus. Under the guidelines that apply
currently for FIIs, no FII (or members of an affiliated group investing through
one or more FIIs) may hold more than 5% of the total issued capital of any
Indian company. In addition, all non-resident portfolio investments, including
those of all FIIs and their clients, may not exceed 24% of the issued share
capital of any Indian company; however, the 24% limit does not apply to
investments by FIIs through authorized offshore funds and offshore equity
issues. Further, at least 70% of the total investments made by an FII pursuant
to its FII authorization must be in equity and equity related instruments such
as convertible debentures and tradeable warrants. Under a recently adopted
policy, FIIs may purchase new issues of equity securities directly from an
Indian company, subject to certain conditions. The procedures for such direct
subscription by FIIs of such equity securities are unclear and it is likely that
a further limit, in addition to the 24% limit referred to above, may be imposed.
The guidelines that apply for FIIs are relatively recent and thus experience as
to their application has been limited. At present, FII authorizations are
granted for five years and may be renewed with the approval of India
governmental authorities. Korea generally prohibits foreign investment in
Won-denominated debt securities and Sri Lanka prohibits foreign investment in
government debt securities. In the Philippines, the Portfolio may generally
invest in "B" shares of Philippine issuers engaged in partly nationalized
business activities, which shares are made available to foreigners, and the
market prices, liquidity and rights of which may vary from shares owned by
nationals. Similarly, in the People's Republic of China (the "PRC"), the
Portfolio may only invest in "B" shares of securities traded on The Shanghai
Securities Exchange and The Shenzhen Stock Exchange, currently the two
officially recognized securities exchanges in the PRC. "B" shares traded on The
Shanghai Securities Exchange are settled in U.S. dollars and those traded on The
Shenzhen Stock Exchange are generally settled in Hong Kong dollars.

In Hong Kong, Korea, the Philippines, Taiwan and Thailand, there are
restrictions on the percentage of permitted foreign investment in shares of
certain companies, mainly those in highly regulated industries, although in
Taiwan there are limitations on foreign ownership of shares of any listed
company. In addition, Korea also prohibits foreign investment in specified
telecommunications companies and the Philippines prohibits foreign investment in
mass media companies and companies providing certain professional services.

From time to time, pooled investment funds may be the most effective
available means by which the Portfolio may invest in equity securities of
certain Asian growth markets. For example, prior to January 3, 1992, foreign
investment in Korea was generally limited to a few investment funds that had
been granted a license from the government of Korea, although since that date
direct foreign investment in individual stocks in Korea has been officially
permitted within specific limits. Investment in such investment funds may
involve the payment of management expenses and, in connection with some
purchases, sales loads, and payment of substantial premiums above the value of
such companies' portfolio securities. The Portfolio does not intend to invest in
such investment funds unless, in the judgment of the Advisor, the potential
benefits of such investment outweigh the payment of any applicable premium,
sales load and expenses.

B-15

<PAGE>

MARKET CHARACTERISTICS

DIFFERENCES BETWEEN THE U.S. AND ASIAN SECURITIES MARKETS. The
securities markets of Asian growth markets have substantially less volume than
the New York Stock Exchange, and equity and debt securities of most companies in
Asian growth markets are less liquid and more volatile than equity and debt
securities of U.S. companies of comparable size. Some of the stock exchanges in
Asian growth markets, such as those in the PRC, are in the earliest stages of
their development. Many companies traded on securities markets in Asian growth
markets are smaller, newer and less seasoned than companies whose securities are
traded on securities markets in the United States. Investments in smaller
companies involve greater risk than is customarily associated with investing in
larger companies. Smaller companies may have limited product lines, markets or
financial or managerial resources and may be more susceptible to losses and
risks of bankruptcy. Additionally, market making and arbitrage activities are
generally less extensive in such markets, which may contribute to increased
volatility and reduced liquidity of such markets. Accordingly, each of these
markets may be subject to greater influence by adverse events generally
affecting the market, and by large investors trading significant blocks of
securities, than is usual in the United States. To the extent that any Asian
growth market experiences rapid increases in its money supply and investment in
equity securities for speculative purposes, the equity securities traded in any
such country may trade at price-earnings multiples higher than those of
comparable companies trading on securities markets in the United States, which
may not be sustainable. Securities markets in Asian growth markets may also be
subject to substantial governmental control, which may cause sudden or prolonged
disruptions in market prices unrelated to supply and demand considerations. This
may also be true of currency markets.

Brokerage commissions and other transaction costs on securities
exchanges in Asian growth markets are generally higher than in the United
States. In addition, security settlements may in some instance be subject to
delays and related administrative uncertainties, including risk of loss
associated with the credit of local brokers.

GOVERNMENT SUPERVISION OF ASIAN SECURITIES MARKETS; LEGAL SYSTEMS.
There is less government supervision and regulation of foreign securities
exchanges, listed companies and brokers in Asian growth markets than exists in
the United States. Less information, therefore, may be available to the Fund
than in respect of investments in the United States. Further, in certain Asian
growth markets, less information may be available to the Fund than to local
market participants. Brokers in Asian growth markets may not be as well
capitalized as those in the United States, so that they are more susceptible to
financial failure in times of market, political, or economic stress. In
addition, existing laws and regulations are often inconsistently applied. As
legal systems in some of the Asian growth markets develop, foreign investors may
be adversely affected by new laws and regulations, changes to existing laws and
regulations and preemption of local laws and regulations by national laws. In
circumstances where adequate laws exist, it may not be possible to obtain swift
and equitable enforcement of the law. Currently a mixture of legal and
structural restrictions affect the securities markets of certain Asian growth
markets. India in particular is experiencing

B-16

<PAGE>

difficulty in processing and settling securities transactions to such a degree
that investments are currently impeded.

Korea, in an attempt to avoid market manipulation, requires
institutional investors to deposit in their broker's account a percentage of the
amount to be invested (currently 20%) prior to execution of a purchase order.
That deposit requirement will expose the Fund to the broker's credit risk. These
examples demonstrate that legal and structural developments can be expected to
affect the Portfolio, potentially affecting liquidity of positions held by the
Portfolio, in unexpected and significant ways from time to time.

FINANCIAL INFORMATION AND STANDARDS. Issuers in Asian growth markets
generally are subject to accounting, auditing and financial standards and
requirements that differ, in some cases significantly, from those applicable to
U.S. issuers. In particular, the assets and profits appearing on the financial
statements of an Asian growth market issuer may not reflect its financial
position or results of operations in accordance with U.S. generally accepted
accounting principles. In addition, for an issuer that keeps accounting records
in local currency, inflation accounting rules may require, for both tax and
accounting purposes, that certain assets and liabilities be restated on the
issuer's balance sheet in order to express items in terms of currency of
constant purchasing power. Inflation accounting may indirectly generate losses
or profits. Consequently, financial data may be materially affected by
restatements for inflation and may not accurately reflect the real condition of
those issuers and securities markets. Moreover, substantially less information
may be publicly available about issuers in Asian growth markets than is
available about U.S. issuers.

SOCIAL, POLITICAL AND ECONOMIC FACTORS

Asian growth markets may be subject to a greater degree of social,
political and economic instability than is the case in the United States and
Western European countries. Such instability may result from, among other
things, the following: (i) authoritarian governments or military involvement in
political and economic decision-making, and changes in government through
extra-constitutional means; (ii) popular unrest associated with demand for
improved political, economic and social conditions; (iii) internal insurgencies,
(iv) war or hostile relations with neighboring countries; and (v) ethnic,
religious and racial disaffection. Such social, political and economic
instability could significantly disrupt the principal financial markets in which
the Portfolio invests and adversely affect the value of the Portfolio's assets.
In addition, there may be the possibility of asset expropriations or future
confiscatory levels of taxation affecting the Portfolio.

Few Asian growth markets have western-style or fully democratic
governments. Some governments in the region are authoritarian and influenced by
security forces. During the course of the last 25 years, governments in the
region have been installed or removed as a result of military coups, while
others have periodically demonstrated repressive police state characteristics.
Disparities of wealth, among other factors, have also led to social unrest in
some Asian growth markets, accompanied, in certain cases, by violence and labor
unrest. Ethnic, religious and

B-17

<PAGE>

racial disaffection, as evidenced in India, Pakistan and Sri Lanka, have created
social, economic and political problems.

Several Asian growth markets have or in the past have had hostile
relationships with neighboring nations or have experienced internal insurgency.
Thailand has experienced border conflicts with Laos and Cambodia, and India is
engaged in border disputes with several of its neighbors, including the PRC and
Pakistan. Tension between the Tamil and Sinhalese communities in Sri Lanka has
resulted in periodic outbreaks of violence. An uneasy truce exists between North
Korea and South Korea, and the recurrence of hostilities remains possible.
Reunification of North Korea and South Korea could have a detrimental effect on
the economy of South Korea. Also, the PRC continues to claim sovereignty over
Taiwan. The PRC is acknowledged to possess nuclear weapons capability; North
Korea is alleged to possess or be in the process of developing such a
capability.

The economies of most Asian growth markets are heavily dependent upon
international trade and are accordingly affected by protective barriers and the
economic conditions of their trading partners, principally, the United States,
Japan, the PRC and the European Community. The enactment by the United States or
other principal trading partners of protectionist trade legislation, reduction
of foreign investment in the local economies and general declines in the
international securities markets could have a significant adverse effect upon
the securities markets of the Asian growth markets. In addition, the economies
of some Asian growth markets, Indonesia and Malaysia, for example, are
vulnerable to weakness in world prices for their commodity exports, including
crude oil.

Governments in certain Asian growth markets participate to a
significant degree, through ownership interest or regulation, in their
respective economies. Action by these governments could have a significant
adverse effect on market prices of securities and payment of dividends.

With respect to investments in the PRC, it should be noted that the PRC
has only recently permitted private economic activities and the PRC government
has exercised and continues to exercise substantial control over virtually every
sector of the PRC economy through regulation and state ownership. The PRC is a
socialist state which since 1949 has been, and is expected to continue to be,
controlled by the Communist party of the PRC. Continued economic growth and
development in the PRC, as well as opportunities for foreign investment, and
prospects of private sector enterprises, in the PRC, will depend in many
respects on the implementation of the PRC's current program of economic reform,
which cannot be assured.

In Hong Kong, British proposals to extend limited democracy have caused
a political rift with the PRC, which is scheduled to assume sovereignty over the
colony in 1997. Although the PRC has committed by treaty to preserve the
economic and social freedoms enjoyed in Hong Kong for 50 years after regaining
control of Hong Kong, the continuation of the current form of the economic
system in Hong Kong after the reversion will depend on the actions of the
government of the PRC. In addition, such reversion has increased sensitivity in
Hong Kong to political developments and statements by public figures in the PRC.
Business confidence in Hong Kong, therefore, can be significantly affected by
such developments and statements, which in turn can affect markets and business
performance.

B-18

<PAGE>

With respect to investments in Taiwan, it should be noted that Taiwan
lacks formal diplomatic relations with many nations, although it conducts trade
and financial relations with most major economic powers. Both the government of
the PRC and the government of the Republic of China in Taiwan claim sovereignty
over all of China. Although relations between Taiwan and the PRC are currently
peaceful, renewed frictions or hostility could interrupt operations of Taiwanese
companies in which the Portfolio invests and create uncertainty that could
adversely affect the value and marketability of its Taiwan investments.

With regard to India, agriculture occupies a more prominent position in
the Indian economy than in the United States, and the Indian economy therefore
is more susceptible to adverse changes in weather. The government of India has
exercised and continues to exercise significant influence over many aspects of
the economy, and the number of public sector enterprises in India is
substantial. Accordingly government actions in the future could have a
significant effect on the Indian economy which could affect private sector
companies, market conditions and prices and yields of securities held by the
Portfolio. Religious and ethnic unrest persists in India. The long standing
grievances between the Hindu and Muslim populations resulted in communal
violence during 1993 in the aftermath of the destruction of a mosque in Ayodhya
by radical elements of the Hindu population. The Indian government is also
confronted by separatist movements in several states and the long standing
border dispute with Pakistan over the State of Jammu and Kashmir, a majority of
whose population is Muslim, remains unsolved. In addition, Indian stock
exchanges have in the past been subject to repeated closure including for ten
days in December 1993 due to a broker's strike, and there can be no assurance
that this will not recur.

THINLY TRADED MARKETS

Compared to securities traded in the United States, generally all
securities of Asian growth market issuers may be considered to be thinly traded.
Even relatively widely held securities in such countries may not be able to
absorb trades of a size customarily transacted by institutional investors,
without price disruptions. Accordingly, the Portfolio's ability to reposition
itself will be more constrained than would be the case for a typical equity
mutual fund.

SETTLEMENT PROCEDURES AND DELAYS

Settlement procedures in Asian growth markets are less developed and
reliable than those in the United States and in other developed markets, and the
Portfolio may experience settlement delays or other material difficulties. This
problem is particularly severe in India where settlement is through physical
delivery and, where currently, a severe shortage of vault capacity exists among
custodial banks, although efforts are being undertaken to alleviate the
shortage. In addition, significant delays are common in registering transfers of
securities, and the Portfolio may be unable to sell such securities until the
registration process is completed and may experience delays in receipt of
dividends and other entitlement. The recent and anticipated inflow of funds into
the Indian securities market has placed added strains on the settlement system
and transfer process. In addition, the Portfolio may be subject to significant
limitations in the future on the volume of trading during any particular period,
imposed by its sub-custodian in India or otherwise as a result of such physical
or other operational constraints.

B-19
<PAGE>

PART C

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS.

(a) Financial Statements:

The following financial statements are included in Part A:

Financial Highlights: The JPM Advisor U.S. Equity Fund and The JPM Advisor U.S.
Small Cap Equity Fund.

The following financial statements are included in Part B:

The JPM Advisor U.S. Fixed Income Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The U.S. Fixed Income Portfolio
Schedule of Investments at April 30, 1995 (unaudited)
Statement of Assets and Liabilities at April 30, 1995 (unaudited)
Statement of Operations for the fiscal year ended April 30, 1995 (unaudited)
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, April 30, 1995 (unaudited)
Schedule of Investments at October 31, 1994
Statement of Assets and Liabilities at October 31, 1994
Statement of Operations for the fiscal year ended October 31, 1994
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, October 31, 1994

The JPM Advisor International Fixed Income Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The Non-U.S. Fixed Income Portfolio
Statement of Assets and Liabilities at October 6, 1994
Notes to Financial Statement, October 6, 1994

The JPM Advisor U.S. Equity Fund
Statement of Assets and Liabilities at May 31, 1995
Statement of Operations For the fiscal year ended May 31, 1995
Statement of Changes in Net Assets
Financial Highlights
Notes to Financial Statements, May 31, 1995

The Selected U.S. Equity Portfolio
Schedule of Investments at May 31, 1995
Statement of Assets and Liabilities at May 31, 1995
Statement of Operations For the fiscal year ended May 31, 1995
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, May 31, 1995

The JPM Advisor U.S. Small Cap Equity Fund
Statement of Assets and Liabilities at May 31, 1995
Statement of Operations For the fiscal year ended May 31, 1995
Statement of Changes in Net Assets
Financial Highlights
Notes to Financial Statements, May 31, 1995

The U.S. Small Company Portfolio
Schedule of Investments at May 31, 1995
Statement of Assets and Liabilities at May 31, 1995
Statement of Operations for the fiscal year ended May 31, 1995
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, May 31, 1995

The JPM Advisor International Equity Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The Non-U.S. Equity Portfolio
Schedule of Investments at April 30, 1995 (unaudited)
Statement of Assets and Liabilities at April 30, 1995 (unaudited)
Statement of Operations for the fiscal year ended April 30, 1995 (unaudited)
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, April 30, 1995 (unaudited)
Schedule of Investments at October 31, 1994
Statement of Assets and Liabilities at October 31, 1994
Statement of Operations for the fiscal year ended October 31, 1994
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, October 31, 1994

The JPM Advisor Emerging Markets Equity Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The Emerging Markets Equity Portfolio
Schedule of Investments at April 30, 1995 (unaudited)
Statement of Assets and Liabilities at April 30, 1995 (unaudited)
Statement of Operations for the fiscal year ended April 30, 1995 (unaudited)
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, April 30, 1995 (unaudited)
Schedule of Investments at October 31, 1994
Statement of Assets and Liabilities at October 31, 1994
Statement of Operations for the fiscal year ended October 31, 1994
Statement of Changes in Net Assets
Supplementary Data
Notes to Financial Statements, October 31, 1994

The JPM Advisor Asia Growth Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The Asia Growth Portfolio
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The JPM Advisor European Equity Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The European Equity Portfolio
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The JPM Advisor Japan Equity Fund
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

The Japan Equity Portfolio
Statement of Assets and Liabilities at March 24, 1995
Notes to Financial Statement, March 24, 1995

(b) Exhibits

1 Declaration of Trust, as amended.4

1(a) Amendment No. 2 to the Declaration of Trust.4

2 By-Laws, as amended.4

3 Not Applicable.

4 Not Applicable.

5 Not Applicable.

6 Distribution Agreement between Registrant and Signature Broker-Dealer
Services, Inc. ("SBDS").1

7 Not Applicable.

8 Custodian Contract between Registrant and State Street Bank and Trust
Company ("State Street").2

9(a) Administration Agreement between Registrant and SBDS.2

9(b) Services Agreement between Registrant and Morgan Guaranty Trust Company
of New York.2

9(c) Transfer Agency and Service Agreement between Registrant and State
Street.2

10 Opinion and consent of Sullivan & Cromwell.3

11 Consents of Independent Accountants.4

12 Not Applicable.

13 Purchase Agreements.3

14 Not Applicable.

15 Not Applicable.

16 Schedule for computation of performance quotations.3

17 Financial Data Schedules.4

18 Powers of Attorney for Registrant's Trustees and Officers and
Portfolios' Trustees and Officers.3

1 Incorporated herein by reference from the Registrant's initial registration
statement on Form N-1A (the "Registration Statement") as filed with the
Securities and Exchange Commission (the "SEC") on October 3, 1994.

2 Incorporated herein by reference from pre-effective amendment no. 1 to the
Registration Statement as filed with the SEC on March 1, 1995.

3 Incorporated herein by reference from pre-effective amendment no. 2 to the
Registration Statement as filed with the SEC on March 28, 1995.

4 Filed herewith.

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.

Not applicable.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES.

Title of Class: Shares of Beneficial Interest (par value $0.001)

As of September 20, 1995:

The JPM Advisor U.S. Fixed Income: 1
The JPM Advisor International Fixed Income Fund: 1
The JPM Advisor U.S. Equity Fund: 1
The JPM Advisor U.S. Small Cap Equity Fund: 1
The JPM Advisor International Equity Fund: 1
The JPM Advisor Emerging Markets Equity Fund: 1
The JPM Advisor Asia Growth Fund: 1
The JPM Advisor European Equity Fund: 1
The JPM Advisor Japan Equity Fund: 1

ITEM 27. INDEMNIFICATION.

Reference is made to Section 5.3 of Registrant's Declaration of Trust
and Article 4 of Registrant's Distribution Agreement.

Registrant, its Trustees and officers are insured against certain
expenses in connection with the defense of claims, demands, actions, suits, or
proceedings, and certain liabilities that might be imposed as a result of such
actions, suits or proceedings.

Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "1933 Act"), may be permitted to directors,
trustees, officers and controlling persons of the Registrant and the principal
underwriter pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the 1933 Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
trustee, officer, or controlling person of the Registrant and the principal
underwriter in connection with the successful defense of any action, suite or
proceeding) is asserted against the Registrant by such director, trustee,
officer or controlling person or principal underwriter in connection with the
shares being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the 1933 Act and will be governed by the
final adjudication of such issue.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.

Not applicable.

ITEM 29. PRINCIPAL UNDERWRITERS.

(a) SBDS is the Distributor (the "Distributor") for the shares of the
Registrant. SBDS also serves as the principal underwriter or placement agent for
numerous other registered investment companies.

(b) The following are the directors and officers of the Distributor.
The principal business address of these individuals is 6 St. James Avenue, Suite
900, Boston, Massachusetts 02116 unless otherwise noted.

PHILIP W. COOLIDGE: President, Chief Executive Officer and Director of SBDS.
President of Registrant.

BARBARA M. O'DETTE: Assistant Treasurer of SBDS.

LINWOOD C. DOWNS: Treasurer of SBDS.

THOMAS M. LENZ: Assistant Secretary of SBDS. Assistant Secretary of Registrant.

MOLLY S. MUGLER: Assistant Secretary of SBDS. Assistant Secretary of Registrant.

LINDA T. GIBSON: Assistant Secretary of SBDS.

BETH A. REMY: Assistant Treasurer of SBDS.

ANDRES E. SALDANA: Assistant Secretary of SBDS. Assistant Secretary of the
Registrant.

SUSAN JAKUBOSKI: Assistant Treasurer of SBDS.

JULIE J. WYETZNER: Product Management Officer of SBDS.

KATE B.M. BOLSOVER: Director of SBDS; Signature Financial Group (Europe), Ltd.,
49 St. James's Street, London SW1A 1JT.

ROBERT G. DAVIDOFF: Director of SBDS; CMNY Capital, L.P., 135 East 57th Street
New York, NY 10022.

LEEDS HACKETT: Director of SBDS; Hackett Associates Limited, 1260 Avenue of the
Americas, 12th Floor, New York, NY 10020

LAURENCE B. LEVINE: Director of SBDS; Blair Corporation, 250 Royal Palm Way,
Palm Beach, FL 33480

DONALD S. CHADWICK: Director of SBDS; 4609 Bayard Street, Apartment 411,
Pittsburgh, PA 15213.

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS.

All accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940, as amended (the "1940
Act"), and the Rules thereunder will be maintained at the offices of:

Morgan Guaranty Trust Company of New York: 60 Wall Street, New York, New York
10260-0060, or 9 West 57th Street, New York, New York 10019 (records relating to
its functions as shareholder servicing agent, and services agent).

State Street Bank and Trust Company: 1776 Heritage Drive, North Quincy,
Massachusetts 02171 (records relating to its functions as custodian, transfer
agent and dividend disbursing agent).

Signature Broker-Dealer Services, Inc.: 6 St. James Avenue, Boston,
Massachusetts 02116 (records relating to its functions as distributor and
administrator).

Investors Bank and Trust Company: 1 First Canadian Place, Suite 5820, P.O. Box
231, Toronto, Ontario M5X1C8 (accounting records).

ITEM 31. MANAGEMENT SERVICES.

Not applicable.

ITEM 32. UNDERTAKINGS.

(a) If the information called for by Item 5A of Form N-1A is contained in the
latest annual report to shareholders, the Registrant shall furnish each person
to whom a prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders upon request and without charge.

(b) The Registrant undertakes to file a post-effective amendment, using
financials which need not be certified, within four to six months following the
effective date of this registration statement. The financial statements included
in such amendment will be as of and for the time period ended on a date
reasonably close or as soon as practicable to the date of the filing of the
amendment.

(c) The Registrant undertakes to comply with Section 16(c) of the 1940 Act as
though such provisions of the 1940 Act were applicable to the Registrant, except
that the request referred to in the third full paragraph thereof may only be
made by shareholders who hold in the aggregate at least 10% of the outstanding
shares of the Registrant, regardless of the net asset value of shares held by
such requesting shareholders.

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
pre-effective amendment no. 2 to its Registration Statement on Form N-1A (the
"Registration Statement") to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Boston and Commonwealth of Massachusetts on the
29th day of September, 1995.

THE JPM ADVISOR FUNDS

By /S/PHILIP W. COOLIDGE*
Philip W. Coolidge
President

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on September 29, 1995.

/S/PHILIP W. COOLIDGE*
Philip W. Coolidge
President

/S/JOHN R. ELDER
John R. Elder
Treasurer and Principal Financial and Accounting Officer

John C. Cox
Trustee

/S/JOYCE NELSON*
Joyce Nelson
Trustee

/S/JOHN R. RETTBERG*
John R. Rettberg
Trustee

/S/JOHN F. RUFFLE*
John F. Ruffle
Trustee

/S/KENNETH WHIPPLE*
Kenneth Whipple
Trustee

*By /S/THOMAS M. LENZ
Thomas M. Lenz
as attorney-in-fact pursuant to a power of attorney previously filed.

<PAGE>
SIGNATURES

Each Portfolio has duly caused this Registration Statement on Form N-1A
("Registration Statement") of The JPM Advisor Funds (the "Trust") (File No.
33-84798) to be signed on its behalf by the undersigned, thereto duly
authorized, in the City of George Town, Grand Cayman, Cayman Islands, B.W.I.,
on the 29th day of September, 1995.

THE U.S. FIXED INCOME PORTFOLIO, THE SELECTED U.S. EQUITY PORTFOLIO, THE U.S.
SMALL COMPANY PORTFOLIO, THE NON-U.S. EQUITY PORTFOLIO, THE EMERGING MARKETS
EQUITY PORTFOLIO, THE NON-U.S. FIXED INCOME PORTFOLIO, THE JAPAN EQUITY
PORTFOLIO, THE ASIA GROWTH PORTFOLIO AND THE EUROPEAN EQUITY PORTFOLIO

By /S/SUSAN JAKUBOSKI
Susan Jakuboski
Assistant Secretary and Assistant Treasurer

Pursuant to the requirements of the Securities Act of 1933, the Trust's
Registration Statement has been signed below by the following persons in the
capacities indicated on September 29, 1995.

/S/PHILIP W. COOLIDGE*
Philip W. Coolidge
President of the Portfolios

/S/SUSAN JAKUBOSKI
Susan Jakuboski
Assistant Treasurer and Acting Principal Financial and Accounting Officer of the
Portfolios

/S/MATTHEW HEALEY*
Matthew Healey
Chairman and Chief Executive
Officer of the Portfolios

/S/F.S. ADDY*
F.S. Addy
Trustee of the Portfolios

/S/WILLIAM G. BURNS*
William G. Burns
Trustee of the Portfolios

/S/ARTHUR C. ESCHENLAUER*
Arthur C. Eschenlauer
Trustee of the Portfolios

/S/MICHAEL P. MALLARDI*
Michael P. Mallardi
Trustee of the Portfolios

*By /S/SUSAN JAKUBOSKI
Susan Jakuboski
as attorney-in-fact pursuant to a power of attorney previously filed.
<PAGE>

Exhibit No. Description of Exhibit
========== ======================

1 Declaration of Trust, as amended.

1(a) Amendment No. 2 to the Declaration of Trust.

2 By-Laws, as amended.

11 Consents of Independent Accountants.

17 Financial Data Schedules.

JPM322

THE JPM ADVISORY FUNDS

DECLARATION OF TRUST

Dated as of September 16, 1994

<PAGE>

TABLE OF CONTENTS

PAGE
ARTICLE I--NAME AND DEFINITIONS 1

Section 1.1 Name 1
Section 1.2 Definitions 1

ARTICLE II--TRUSTEES 3

Section 2.1 Number of Trustees 3
Section 2.2 Term of Office of Trustees 3
Section 2.3 Resignation and Appointment of Trustees 3
Section 2.4 Vacancies 4
Section 2.5 Delegation of Power to Other Trustees 4

ARTICLE III--POWERS OF TRUSTEES 4

Section 3.1 General 4
Section 3.2 Investments 5
Section 3.3 Legal Title 6
Section 3.4 Issuance and Repurchase of Securities 6
Section 3.5 Borrowing Money; Lending Trust Property 6
Section 3.6 Delegation; Committees 6
Section 3.7 Collection and Payment 6
Section 3.8 Expenses 7
Section 3.9 Manner of Acting; By-Laws 7
Section 3.10 Miscellaneous Powers 7
Section 3.11 Principal Transactions 7
Section 3.12 Trustees and Officers as Shareholders 8

ARTICLE IV--INVESTMENT ADVISER, DISTRIBUTOR, ADMINISTRATOR, TRANSFER
AGENT AND SHAREHOLDER SERVICING AGENTS 8

Section 4.1 Investment Adviser 8
Section 4.2 Distributor 9
Section 4.3 Administrator 9
Section 4.4 Transfer Agent and Shareholder Servicing Agents 9
Section 4.5 Parties to Contract 9

ARTICLE V--LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS 10

Section 5.1 No Personal Liability of Shareholders,
Trustees, etc. 10
Section 5.2 Non-Liability of Trustees, etc. 10
Section 5.3 Mandatory Indemnification; Insurance 11
Section 5.4 No Bond Required of Trustees 12
Section 5.5 No Duty of Investigation; Notice in Trust
Instruments, etc. 12
Section 5.6 Reliance on Experts, etc. 13

<PAGE>

ARTICLE VI--SHARES OF BENEFICIAL INTEREST 13

Section 6.1 Beneficial Interest 13
Section 6.2 Rights of Shareholders 13
Section 6.3 Trust Only 13
Section 6.4 Issuance of Shares 14
Section 6.5 Register of Shares 14
Section 6.6 Transfer of Shares 14
Section 6.7 Notices 15
Section 6.8 Voting Powers 15
Section 6.9 Series Designation 15

ARTICLE VII--REDEMPTIONS 18

Section 7.1 Redemptions 18
Section 7.2 Suspension of Right of Redemption 18
Section 7.3 Redemption of Shares; Disclosure of Holding 19
Section 7.4 Redemptions of Accounts of Less than
Minimum Amount 19

ARTICLE VIII--DETERMINATION OF NET ASSET VALUE, NET INCOME AND
DISTRIBUTIONS 19

ARTICLE IX--DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS, ETC. 20
--------------------------------------------------------

Section 9.1 Duration 20
Section 9.2 Termination of Trust 20
Section 9.3 Amendment Procedure 20
Section 9.4 Merger, Consolidation and Sale of Assets 22
Section 9.5 Incorporation, Reorganization 22
Section 9.6 Incorporation or Reorganization of Series 23

ARTICLE X--REPORTS TO SHAREHOLDERS AND SHAREHOLDER COMMUNICATIONS 23
------------------------------------------------------

ARTICLE XI--MISCELLANEOUS 23

Section 11.1 Filing 23
Section 11.2 Governing Law 23
Section 11.3 Counterparts 23
Section 11.4 Reliance by Third Parties 24
Section 11.5 Provisions in Conflict with Law or Regulations 24
Section 11.6 Principal Office 24

APPENDIX I--SERIES DESIGNATION 26

<PAGE>

JPM322

DECLARATION OF TRUST

THE JPM ADVISORY FUNDS

Dated as of September 16, 1994

WHEREAS, the Trustees desire to establish a trust for the investment
and reinvestment of funds contributed thereto; and

WHEREAS, the Trustees desire that the beneficial interest in the trust
assets be divided into transferable Shares of Beneficial Interest (par value
$0.001 per share) ("Shares") issued in one or more series as hereinafter
provided; and

NOW THEREFORE, the Trustees hereby declare that all money and property
contributed to the trust established hereunder shall be held and managed in
trust for the benefit of holders, from time to time, of the Shares issued
hereunder and subject to the provisions hereof.

ARTICLE I

NAME AND DEFINITIONS

SECTION 1.1. NAME. The name of the trust created hereby is "The JPM
Advisory Funds".

SECTION 1.2. DEFINITIONS. Wherever they are used herein, the following
terms have the following respective meanings:

(a) "ADMINISTRATOR" means a party furnishing services to the Trust
pursuant to any contract described in Section 4.3 hereof.

(b) "BY-LAWS" means the By-laws referred to in Section 3.9 hereof, as
from time to time amended.

(d) "CUSTODIAN" means a party employed by the Trust to furnish services
as described in Article X of the By-Laws.

(e) "DECLARATION" means this Declaration of Trust as amended from time
to time. Reference in this Declaration of Trust to "DECLARATION", "HEREOF",

<PAGE>

"HEREIN", and "HEREUNDER" shall be deemed to refer to this Declaration rather
than the article or section in which such words appear.

(f) "DISTRIBUTOR" means a party furnishing services to the Trust
pursuant to any contract described in Section 4.2 hereof.

(g) "INTERESTED PERSON" has the meaning given that term in the 1940
Act.

(h) "INVESTMENT ADVISER" means a party furnishing services to the Trust
pursuant to any contract described in Section 4.1 hereof.

(i) "MAJORITY SHAREHOLDER VOTE" has the same meaning as the phrase
"vote of a majority of the outstanding voting securities" as defined in the 1940
Act, except that such term may be used herein with respect to the Shares of the
Trust as a whole or the Shares of any particular series, as the context may
require.

(j) "1940 ACT" means the Investment Company Act of 1940 and the Rules
and Regulations thereunder, as amended from time to time.

(k) "PERSON" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures and other entities, whether
or not legal entities, and governments and agencies and political subdivisions
thereof, whether domestic or foreign.

(l) "SHAREHOLDER" means a record owner of outstanding Shares.

(m) "SHARES" means the Shares of Beneficial Interest into which the
beneficial interest in the Trust shall be divided from time to time or, when
used in relation to any particular series of Shares established by the Trustees
pursuant to Section 6.9 hereof, equal proportionate transferable units into
which such series of Shares shall be divided from time to time. The term
"Shares" includes fractions of Shares as well as whole Shares.

(n) "SHAREHOLDER SERVICING AGENT" means a party furnishing services to
the Trust pursuant to any shareholder servicing contract described in Section
4.4 hereof.

(o) "TRANSFER AGENT" means a party furnishing services to the Trust
pursuant to any transfer agency contract described in Section 4.4 hereof.

(p) "TRUST" means the trust created hereby.

(q) "TRUST PROPERTY" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of the
Trust or the Trustees, including, without limitation, any and all property
allocated or belonging to any series of Shares pursuant to Section 6.9 hereof.

(r) "TRUSTEES" means the persons who have signed the Declaration, so
long as they shall continue in office in accordance with the terms hereof, and
all other persons who may from time to time be duly elected or appointed,
qualified and serving as Trustees in accordance with the provisions hereof, and
reference

<PAGE>

herein to a Trustee or the Trustees shall refer to such person or persons in
their capacity as trustees hereunder.

ARTICLE II

TRUSTEES

SECTION 2.1. NUMBER OF TRUSTEES. The number of Trustees shall be such
number as shall be fixed from time to time by a written instrument signed by a
majority of the Trustees, provided, however, that the number of Trustees shall
in no event be less than three nor more than 15.

SECTION 2.2. TERM OF OFFICE OF TRUSTEES. Subject to the provisions of
Section 16(a) of the 1940 Act, the Trustees shall hold office during the
lifetime of this Trust and until its termination as hereinafter provided; except
that (a) any Trustee may resign his trust (without need for prior or subsequent
accounting) by an instrument in writing signed by him and delivered to the other
Trustees, which shall take effect upon such delivery or upon such later date as
is specified therein; (b) any Trustee may be removed with cause, at any time by
written instrument signed by at least two-thirds of the remaining Trustees,
specifying the date when such removal shall become effective; (c) any Trustee
who has attained a mandatory retirement age established pursuant to any written
policy adopted from time to time by at least two thirds of the Trustees shall,
automatically and without action of such Trustee or the remaining Trustees, be
deemed to have retired in accordance with the terms of such policy, effective as
of the date determined in accordance with such policy; (d) any Trustee who has
become incapacitated by illness or injury as determined by a majority of the
other Trustees, may be retired by written instrument signed by a majority of the
other Trustees, specifying the date of his retirement; and (e) a Trustee may be
removed at any meeting of Shareholders by a vote of two thirds of the
outstanding Shares of each series. For purposes of the foregoing clause (b), the
term "cause" shall include, but not be limited to, failure to comply with such
written policies as may from time to time be adopted by at least two thirds of
the Trustees with respect to the conduct of Trustees and attendance at meetings.
Upon the resignation, retirement or removal of a Trustee, or his otherwise
ceasing to be a Trustee, he shall execute and deliver such documents as the
remaining Trustees shall require for the purpose of conveying to the Trust or
the remaining Trustees any Trust Property held in the name of the resigning,
retiring or removed Trustee. Upon the incapacity or death of any Trustee, his
legal representative shall execute and deliver on his behalf such documents as
the remaining Trustees shall require as provided in the preceding sentence.

SECTION 2.3. RESIGNATION AND APPOINTMENT OF TRUSTEES. In case of the
declination, death, resignation, retirement, removal or inability of any of the
Trustees, or in case a vacancy shall, by reason of an increase in number, or for
any other reason, exist, the remaining Trustees shall fill such vacancy by
appointing such other individual as they in their discretion shall see fit. Such
appointment shall be evidenced by a written instrument signed by a majority of
the Trustees in office. Any such appointment shall not become effective,
however, until the person named in the written instrument of appointment shall
have accepted in writing such appointment and agreed in writing to be bound by
the terms of the Declaration. Within twelve months of such appointment, the

<PAGE>

Trustees shall cause notice of such appointment to be mailed to each Shareholder
at his address as recorded on the books of the Trustees. An appointment of a
Trustee may be made by the Trustees then in office and notice thereof mailed to
Shareholders as aforesaid in anticipation of a vacancy to occur by reason of
retirement, resignation or increase in number of Trustees effective at a later
date, provided that said appointment shall become effective only at or after the
effective date of said retirement, resignation or increase in number of
Trustees. The power of appointment is subject to the provisions of Section 16
(a) of the 1940 Act.

SECTION 2.4. VACANCIES. The death, declination, resignation,
retirement, removal or incapacity of the Trustees, or any one of them, shall not
operate to annul the Trust or to revoke any existing agency created pursuant to
the terms of this Declaration. Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled as provided in Section 2.3, the
Trustees in office, regardless of their number, shall have all the powers
granted to the Trustees and shall discharge all the duties imposed upon the
Trustees by the Declaration. A written instrument certifying the existence of
such vacancy signed by a majority of the Trustees shall be conclusive evidence
of the existence of such vacancy.

SECTION 2.5. DELEGATION OF POWER TO OTHER TRUSTEES. Any Trustee may, by
power of attorney, delegate his power for a period not exceeding six months at
any one time to any other Trustee or Trustees; provided that in no case shall
fewer than two Trustees personally exercise the powers granted to the Trustees
under the Declaration except as herein otherwise expressly provided.

ARTICLE III

POWERS OF TRUSTEES

SECTION 3.1. GENERAL. The Trustees shall have exclusive and absolute
control over the Trust Property and over the business of the Trust to the same
extent as if the Trustees were the sole owners of the Trust Property and
business in their own right, but with such powers of delegation as may be
permitted by the Declaration. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices both within and without the Commonwealth of Massachusetts,
in any and all states of the United States of America, in the District of
Columbia, and in any and all commonwealths, territories, dependencies, colonies,
possessions, agencies or instrumentalities of the United States of America and
of foreign governments, and to do all such other things and execute all such
instruments as the Trustees deem necessary, proper or desirable in order to
promote the interests of the Trust although such things are not herein
specifically mentioned. Any determination as to what is in the interests of the
Trust made by the Trustees in good faith shall be conclusive. In construing the
provisions of the Declaration, the presumption shall be in favor of a grant of
power to the Trustees.

The enumeration of any specific power herein shall not be construed as
limiting the aforesaid power. Such powers of the Trustees may be exercised
without order of or resort to any court.

<PAGE>

SECTION 3.2. INVESTMENTS. (a) The Trustees shall have the power:

(i) to conduct, operate and carry on the business of an investment
company;

(ii) to subscribe for, invest in, reinvest in, purchase or otherwise
acquire, own, hold, pledge, sell, assign, transfer, exchange, distribute, lend
or otherwise deal in or dispose of U.S. and foreign currencies, any form of gold
or other precious metal, commodity contracts, any form of option contract,
contracts for the future acquisition or delivery of fixed income or other
securities, shares of, or any other interest in, any investment company as
defined in the Investment Company Act of 1940, and securities and related
derivatives of every nature and kind, including, without limitation, all types
of bonds, debentures, stocks, negotiable or non-negotiable instruments,
obligations, evidences of indebtedness, certificates of deposit or indebtedness,
commercial paper, repurchase agreements, bankers' acceptances, and other
securities of any kind, issued, created, guaranteed or sponsored by any and all
Persons, including, without limitation,

(A) states, territories and possessions of the United States and the
District of Columbia and any political subdivision, agency or instrumentality of
any such Person,

(B) the U.S. Government, any foreign government, any political
subdivision or any agency or instrumentality of the U.S. Government, any foreign
government or any political subdivision of the U.S. Government or any foreign
government,

(D) any bank or savings institution, or

(E) any corporation, trust, partnership or other organization organized
under the laws of the United States or of any state, territory or possession
thereof, or under any foreign law;

or in "when issued" contracts for any such securities, to retain Trust assets in
cash and from time to time to change the securities or obligations in which the
assets of the Trust are invested; and to exercise any and all rights, powers and
privileges of ownership or interest in respect of any and all such investments
of every kind and description, including, without limitation, the right to
consent and otherwise act with respect thereto, with power to designate one or
more Persons to exercise any of said rights, powers and privileges in respect of
any of said investments; and

(iii) to carry on any other business in connection with or incidental
to any of the foregoing powers, to do everything necessary, proper or desirable
for the accomplishment of any purpose or the attainment of any object or the
furtherance of any power hereinbefore set forth, and to do every other act or
thing incidental or appurtenant to or connected with the aforesaid purposes,
objects or powers.

<PAGE>

(b) The Trustees shall not be limited to investing in securities or
obligations maturing before the possible termination of the Trust, nor shall the
Trustees be limited by any law limiting the investments which may be made by
fiduciaries.

(c) Notwithstanding any other provision of this Declaration to the
contrary, the Trustees shall have the power in their discretion without any
requirement of approval by shareholders to either invest all or a portion of the
Trust Property, or sell all or a portion of the Trust Property and invest the
proceeds of such sales, in another investment company that is registered under
the 1940 Act.

SECTION 3.3. LEGAL TITLE. Legal title to all Trust Property shall be
vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in the name of
one or more of the Trustees, or in the name of the Trust, or in the name of any
other Person or nominee, on such terms as the Trustees may determine. The right,
title and interest of the Trustees in the Trust Property shall vest
automatically in each Person who may hereafter become a Trustee. Upon the
resignation, removal or death of a Trustee, such Trustee shall automatically
cease to have any right, title or interest in any of the Trust Property, and the
right, title and interest of such Trustee in the Trust Property shall vest
automatically in the remaining Trustees. Such vesting and cessation of title
shall be effective whether or not conveyancing documents have been executed and
delivered.

SECTION 3.4. ISSUANCE AND REPURCHASE OF SECURITIES. The Trustees shall
have the power to issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise deal in Shares and,
subject to the provisions set forth in Articles VII, VIII and IX and Section 6.9
hereof, to apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds of the Trust or other Trust Property whether
capital or surplus or otherwise, to the full extent now or hereafter permitted
by the laws of the Commonwealth of Massachusetts governing business
corporations.

SECTION 3.5. BORROWING MONEY; LENDING TRUST PROPERTY. The Trustees
shall have power to borrow money or otherwise obtain credit and to secure the
same by mortgaging, pledging or otherwise subjecting as security the Trust
Property, to endorse, guarantee, or undertake the performance of any obligation,
contract or engagement of any other Person and to lend Trust Property.

SECTION 3.6. DELEGATION; COMMITTEES. The Trustees shall have power to
delegate from time to time to such of their number or to officers, employees or
agents of the Trust the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient.

SECTION 3.7. COLLECTION AND PAYMENT. Subject to Section 6.9 hereof, the
Trustees shall have power to collect all property due to the Trust; to pay all
claims, including taxes, against the Trust Property; to prosecute, defend,
compromise or abandon any claims relating to the Trust Property; to foreclose
any security interest securing any obligations, by virtue of which any property
is owed to the Trust; and to enter into releases, agreements and other
instruments.

<PAGE>

SECTION 3.8. EXPENSES. Subject to Section 6.9 hereof, the Trustees
shall have the power to incur and pay any expenses which in the opinion of the
Trustees are necessary or incidental to carry out any of the purposes of the
Declaration, and to pay reasonable compensation from the funds of the Trust to
themselves as Trustees. The Trustees shall fix the compensation of all officers,
employees and Trustees.

SECTION 3.9. MANNER OF ACTING; BY-LAWS. Except as otherwise provided
herein or in the By-Laws, any action to be taken by the Trustees may be taken by
a majority of the Trustees present at a meeting of Trustees at which a quorum is
present, including any meeting held by means of a conference telephone circuit
or similar communications equipment by means of which all persons participating
in the meeting can hear each other, or by written consents of a majority of the
Trustees. The Trustees may adopt By-Laws not inconsistent with this Declaration
to provide for the conduct of the business of the Trust and may amend or repeal
such By-Laws to the extent such power is not reserved to the Shareholders.

SECTION 3.10. MISCELLANEOUS POWERS. The Trustees shall have the power
to: (a) employ or contract with such Persons as the Trustees may deem desirable
for the transaction of the business of the Trust; (b) enter into joint ventures,
partnerships and any other combinations or associations; (c) remove Trustees or
fill vacancies in or add to their number, elect and remove such officers and
appoint and terminate such agents or employees as they consider appropriate, and
appoint from their own number, and terminate, any one or more committees which
may exercise some or all of the power and authority of the Trustees as the
Trustees may determine; (d) purchase, and pay for out of Trust Property,
insurance policies insuring the Shareholders, the Administrator, Trustees,
officers, employees, agents, the Investment Adviser, the Distributor, selected
dealers or independent contractors of the Trust against all claims arising by
reason of holding any such position or by reason of any action taken or omitted
by any such Person in such capacity, whether or not constituting negligence, or
whether or not the Trust would have the power to indemnify such Person against
such liability; (e) establish pension, profit-sharing, Share purchase, and other
retirement, incentive and benefit plans for any Trustees, officers, employees or
agents of the Trust; (f) to the extent permitted by law, indemnify any person
with whom the Trust has dealings, including any Investment Adviser,
Administrator, Custodian, Distributor, Transfer Agent, Shareholder Servicing
Agent and any dealer, to such extent as the Trustees shall determine; (g)
guarantee indebtedness or contractual obligations of others; (h) determine and
change the fiscal year of the Trust and the method by which its accounts shall
be kept; and (i) adopt a seal for the Trust, provided, that the absence of such
seal shall not impair the validity of any instrument executed on behalf of the
Trust.

SECTION 3.11. PRINCIPAL TRANSACTIONS. Except in transactions permitted
by the 1940 Act, or any order of exemption issued by the Commission, the
Trustees shall not, on behalf of the Trust, buy any securities (other than
Shares) from or sell any securities (other than Shares) to, or lend any assets
of the Trust to, any Trustee or officer of the Trust or any firm of which any
such Trustee or officer is a member acting as principal, or have any such
dealings with any Investment Adviser, Administrator, Shareholder Servicing
Agent, Custodian, Distributor or Transfer Agent or with any Interested Person of
such Person; but

<PAGE>

the Trust may, upon customary terms, employ any such Person, or firm or company
in which such Person is an Interested Person, as broker, legal counsel,
registrar, transfer agent, dividend disbursing agent or custodian.

SECTION 3.12. TRUSTEES AND OFFICERS AS SHAREHOLDERS. Except as
hereinafter provided, no officer, Trustee or member of any advisory board of the
Trust, and no member, partner, officer, director or trustee of the Investment
Adviser, Administrator or of the Distributor, and no Investment Adviser,
Administrator or Distributor of the Trust, shall take long or short positions in
the securities issued by the Trust. The foregoing provision shall not prevent:

(a) The Distributor from purchasing Shares from the Trust if such
purchases are limited (except for reasonable allowances for clerical errors,
delays and errors of transmission and cancellation of orders) to purchases for
the purpose of filling orders for Shares received by the Distributor and
provided that orders to purchase from the Trust are entered with the Trust or
the Custodian promptly upon receipt by the Distributor of purchase orders for
Shares, unless the Distributor is otherwise instructed by its customer;

(b) The Distributor from purchasing Shares as agent for the account of
the Trust;

(c) The purchase from the Trust or from the Distributor of Shares by
any officer, Trustee or member of any advisory board of the Trust or by any
member, partner, officer, director or trustee of the Investment Adviser or of
the Distributor at a price not lower than the net asset value of the Shares at
the moment of such purchase, provided that any such sales are only to be made
pursuant to a uniform offer described in the current prospectus or statement of
additional information for the Shares being purchased; or

(d) The Investment Adviser, the Distributor, the Administrator, or any
of their officers, partners, directors or trustees from purchasing Shares prior
to the effective date of the Trust's Registration Statement under the Securities
Act of 1933, as amended, relating to the Shares.

ARTICLE IV

INVESTMENT ADVISER, DISTRIBUTOR, ADMINISTRATOR, TRANSFER AGENT
AND SHAREHOLDER SERVICING AGENTS

SECTION 4.1. INVESTMENT ADVISER. Subject to a Majority Shareholder Vote
of the Shares of each series affected thereby, the Trustees may in their
discretion from time to time enter into one or more investment advisory or
management contracts whereby the other party to each such contract shall
undertake to furnish the Trust such management, investment advisory, statistical
and research facilities and services, promotional activities, and such other
facilities and services, if any, with respect to one or more series of Shares,
as the Trustees shall from time to time consider desirable and all upon such
terms and conditions as the Trustees may in their discretion determine.
Notwithstanding any provision of the Declaration, the Trustees may delegate to
the Investment Adviser authority (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect purchases,

<PAGE>

sales, loans or exchanges of assets of the Trust on behalf of the Trustees or
may authorize any officer, employee or Trustee to effect such purchases, sales,
loans or exchanges pursuant to recommendations of the Investment Adviser (and
all without further action by the Trustees). Any of such purchases, sales, loans
or exchanges shall be deemed to have been authorized by all the Trustees. Such
services may be provided by one or more Persons.

SECTION 4.2. DISTRIBUTOR. The Trustees may in their discretion from
time to time enter into one or more distribution contracts providing for the
sale of Shares whereby the Trust may either agree to sell the Shares to the
other party to any such contract or appoint any such other party its sales agent
for such Shares. In either case, any such contract shall be on such terms and
conditions as the Trustees may in their discretion determine, provided that such
terms and conditions are not inconsistent with the provisions of the Declaration
or the By-Laws; and such contract may also provide for the repurchase or sale of
Shares by such other party as principal or as agent of the Trust and may provide
that such other party may enter into selected dealer and sales agreements with
registered securities dealers and depository institutions to further the purpose
of the distribution or repurchase of the Shares. Such services may be provided
by one or more Persons.

SECTION 4.3. ADMINISTRATOR. The Trustees may in their discretion from
time to time enter into one or more administrative services contracts whereby
the other party to each such contract shall undertake to furnish such
administrative services to the Trust as the Trustees shall from time to time
consider desirable and all upon such terms and conditions as the Trustees may in
their discretion determine, provided that such terms and conditions are not
inconsistent with the provisions of this Declaration or the By-Laws. Such
services may be provided by one or more Persons.

SECTION 4.4. TRANSFER AGENT AND SHAREHOLDER SERVICING AGENTS. The
Trustees may in their discretion from time to time enter into one or more
transfer agency and shareholder servicing contracts whereby the other party to
each such contract shall undertake to furnish such transfer agency and/or
shareholder services to the Trust or to shareholders of the Trust as the
Trustees shall from time to time consider desirable and all upon such terms and
conditions as the Trustees may in their discretion determine, provided that such
terms and conditions are not inconsistent with the provisions of this
Declaration or the By-Laws. Such services may be provided by one or more
Persons. Except as otherwise provided in the applicable shareholder servicing
contract, a Shareholder Servicing Agent shall be deemed to be the record owner
of outstanding Shares beneficially owned by customers of such Shareholder
Servicing Agent for whom it is acting pursuant to such shareholder servicing
contract.

SECTION 4.5. PARTIES TO CONTRACT. Any contract of the character
described in Section 4.1, 4.2, 4.3 or 4.4 of this Article IV or any Custodian
contract as described in Article X of the By-Laws may be entered into with any
Person, although one or more of the Trustees or officers of the Trust may be an
officer, partner, director, trustee, shareholder, or member of such other party
to the contract, and no such contract shall be invalidated or rendered voidable
by

<PAGE>

reason of the existence of any such relationship; nor shall any Person holding
such relationship be liable merely by reason of such relationship for any loss
or expense to the Trust under or by reason of any such contract or accountable
for any profit realized directly or indirectly therefrom, provided that the
contract when entered into was not inconsistent with the provisions of this
Article IV or the By-Laws. The same Person may be the other party to contracts
entered into pursuant to Sections 4.1, 4.2, 4.3 and 4.4 above or any Custodian
contract as described in Article X of the By-Laws, and any individual may be
financially interested or otherwise affiliated with Persons who are parties to
any or all of the contracts mentioned in this Section 4.5.

ARTICLE V

LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS

SECTION 5.1. NO PERSONAL LIABILITY OF SHAREHOLDERS, TRUSTEES, ETC. No
Shareholder shall be subject to any personal liability whatsoever to any Person
in connection with Trust Property or the acts, obligations or affairs of the
Trust. No Trustee, officer, employee or agent of the Trust shall be subject to
any personal liability whatsoever to any Person, other than the Trust or its
Shareholders, in connection with Trust Property or the affairs of the Trust,
save only that arising from bad faith, wilful misfeasance, gross negligence or
reckless disregard for his duty to such Person; and all such Persons shall look
solely to the Trust Property for satisfaction of claims of any nature arising in
connection with the affairs of the Trust. If any Shareholder, Trustee, officer,
employee, or agent, as such, of the Trust, is made a party to any suit or
proceeding to enforce any such liability, he shall not, on account thereof, be
held to any personal liability. The Trust shall indemnify and hold each
Shareholder harmless from and against all claims and liabilities to which such
Shareholder may become subject by reason of his being or having been a
Shareholder, and shall reimburse such Shareholder for all legal and other
expenses reasonably incurred by him in connection with any such claim or
liability. The rights accruing to a Shareholder under this Section 5.1 shall not
exclude any other right to which such Shareholder may be lawfully entitled, nor
shall anything herein contained restrict the right of the Trust to indemnify or
reimburse a Shareholder in any appropriate situation even though not
specifically provided herein. Notwithstanding any other provision of this
Declaration to the contrary, no Trust Property shall be used to indemnify or
reimburse any Shareholder of any Shares of any series other than Trust Property
allocated or belonging to that series.

SECTION 5.2. NON-LIABILITY OF TRUSTEES, ETC. No Trustee, officer,
employee or agent of the Trust shall be liable to the Trust or to any
Shareholder, Trustee, officer, employee, or agent thereof for any action or
failure to act (including without limitation the failure to compel in any way
any former or acting Trustee to redress any breach of trust) except for his own
bad faith, wilful misfeasance, gross negligence or reckless disregard of his
duties.

<PAGE>

SECTION 5.3. MANDATORY INDEMNIFICATION; INSURANCE. (a) Subject to the
exceptions and limitations contained in paragraph (b) below:

(i) every person who is or has been a Trustee or officer of the Trust
shall be indemnified by the Trust, to the fullest extent permitted by law
(including the 1940 Act) as currently in effect or as hereafter amended, against
all liability and against all expenses reasonably incurred or paid by him in
connection with any claim, action, suit or proceeding in which he becomes
involved as a party or otherwise by virtue of his being or having been a Trustee
or officer and against amounts paid or incurred by him in the settlement
thereof;

(ii) the words "claim", "action", "suit", or "proceeding" shall apply
to all claims, actions, suits or proceedings (civil, criminal, administrative or
other, including appeals), actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys' fees, costs, judgments,
amounts paid in settlement, fines, penalties and other liabilities.

(b) No indemnification shall be provided hereunder to a Trustee or
officer:

(i) against any liability to the Trust or the Shareholders by reason of
a final adjudication by the court or other body before which the proceeding was
brought that he engaged in wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office;

(ii) with respect to any matter as to which he shall have been finally
adjudicated not to have acted in good faith in the reasonable belief that his
action was in the best interest of the Trust; or

(iii) in the event of a settlement involving a payment by a Trustee or
officer or other disposition not involving a final adjudication as provided in
paragraph (b) (i) or (b) (ii) above resulting in a payment by a Trustee or
officer, unless there has been either a determination that such Trustee or
officer did not engage in wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office by the
court or other body approving the settlement or other disposition or by a
reasonable determination, based upon a review of readily available facts (as
opposed to a full trial-type inquiry) that he did not engage in such conduct:

(a) by vote of a majority of the Disinterested Trustees acting on the
matter (provided that a majority of the Disinterested Trustees then in office
act on the matter); or

(b) by written opinion of independent legal counsel.

(c) Subject to the provisions of the 1940 Act, the Trust may maintain
insurance for the protection of the Trust Property, its Shareholders, Trustees,
officers, employees and agents in such amount as the Trustees shall deem
adequate to cover possible tort liability (whether or not the Trust would have
the power to indemnify such Persons against such liability), and such other
insurance as the Trustees in their sole judgment shall deem advisable.

<PAGE>

(d) The rights of indemnification herein provided shall be severable,
shall not affect any other rights to which any Trustee or officer may now or
hereafter be entitled, shall continue as to a Person who has ceased to be such a
Trustee or officer and shall inure to the benefit of the heirs, executors and
administrators of such Person. Nothing contained herein shall affect any rights
to indemnification to which personnel other than Trustees and officers may be
entitled by contract or otherwise under law.

(e) Expenses of preparation and presentation of a defense to any claim,
action, suit, or proceeding of the character described in paragraph (a) of this
Section 5.3 shall be advanced by the Trust prior to final disposition thereof
upon receipt of an undertaking by or on behalf of the recipient to repay such
amount if it is ultimately determined that he is not entitled to indemnification
under this Section 5.3, provided that either:

(i) such undertaking is secured by a surety bond or some other
appropriate security or the Trust shall be insured against losses arising out of
any such advances; or

(ii) a majority of the Disinterested Trustees acting on the matter
(provided that a majority of the Disinterested Trustees then in office act on
the matter) or an independent legal counsel in a written opinion, shall
determine, based upon a review of readily available facts (as opposed to a full
trial-type inquiry), that there is reason to believe that the recipient
ultimately will be found entitled to indemnification.

As used in this Section 5.3 a "Disinterested Trustee" is one (i) who is
not an "Interested Person" of the Trust (including anyone who has been exempted
from being an "Interested Person" by any rule, regulation or order of the
Commission), and (ii) against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or had been pending.

SECTION 5.4. NO BOND REQUIRED OF TRUSTEES. No Trustee shall be
obligated to give any bond or other security for the performance of any of his
duties hereunder.

SECTION 5.5. NO DUTY OF INVESTIGATION; NOTICE IN TRUST INSTRUMENTS,
ETC. No purchaser, lender, Shareholder Servicing Agent, Transfer Agent or other
Person dealing with the Trustees or any officer, employee or agent of the Trust
shall be bound to make any inquiry concerning the validity of any transaction
purporting to be made by the Trustees or by said officer, employee or agent or
be liable for the application of money or property paid, loaned, or delivered to
or on the order of the Trustees or of said officer, employee or agent. Every
obligation, contract, instrument, certificate, Share, other security of the
Trust or undertaking, and every other act or thing whatsoever executed in
connection with the Trust shall be conclusively presumed to have been executed
or done by the executors thereof only in their capacity as Trustees under the
Declaration or in their capacity as officers, employees or agents of the Trust.
Every written obligation, contract, instrument, certificate, Share, other
security of the Trust or undertaking made or issued by the Trustees shall recite
that the same is executed or made by them not individually, but as Trustees
under the

<PAGE>

Declaration, and that the obligations of any such instrument are not binding
upon any of the Trustees or Shareholders individually, but bind only the trust
estate, and may contain any further recital which they or he may deem
appropriate, but the omission of such recital shall not operate to bind any of
the Trustees or Shareholders individually. The Trustees shall at all times
maintain insurance for the protection of the Trust Property, Shareholders,
Trustees, officers, employees and agents in such amount as the Trustees shall
deem adequate to cover possible tort liability, and such other insurance as the
Trustees in their sole judgment shall deem advisable.

SECTION 5.6. RELIANCE ON EXPERTS, ETC. Each Trustee and officer or
employee of the Trust shall, in the performance of his duties, be fully and
completely justified and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account or other records
of the Trust, upon an opinion of counsel, or upon reports made to the Trust by
any of its officers or employees or by the Investment Adviser, the Distributor,
Transfer Agent, any Shareholder Servicing Agent, selected dealers, accountants,
appraisers or other experts or consultants selected with reasonable care by the
Trustees, officers or employees of the Trust, regardless of whether such counsel
or expert may also be a Trustee.

ARTICLE VI

SHARES OF BENEFICIAL INTEREST

SECTION 6.1. BENEFICIAL INTEREST. The interest of the beneficiaries
hereunder may be divided into transferable Shares, which may be divided into one
or more series as provided in Section 6.9 hereof. Each such series shall have
such class or classes of Shares as the Trustees may from time to time determine.
The number of Shares authorized hereunder is unlimited. All Shares issued
hereunder including, without limitation, Shares issued in connection with a
dividend in Shares or a split of Shares, shall be fully paid and non-assessable.

SECTION 6.2. RIGHTS OF SHAREHOLDERS. The ownership of the Trust
Property of every description and the right to conduct any business hereinbefore
described are vested exclusively in the Trustees, and the Shareholders shall
have no interest therein other than the beneficial interest conferred by their
Shares, and they shall have no right to call for any partition or division of
any property, profits, rights or interests of the Trust nor can they be called
upon to assume any losses of the Trust or suffer an assessment of any kind by
virtue of their ownership of Shares. The Shares shall be personal property
giving only the rights specifically set forth in the Declaration. The Shares
shall not entitle the holder to preference, pre-emptive, appraisal, conversion
or exchange rights, except as the Trustees may determine with respect to any
series of Shares.

SECTION 6.3. TRUST ONLY. It is the intention of the Trustees to create
only the relationship of Trustee and beneficiary between the Trustees and the
Shareholders. It is not the intention of the Trustees to create a general
partnership, limited partnership, joint stock association, corporation, bailment
or any form of legal relationship other than a trust. Nothing in the Declaration

<PAGE>

shall be construed to make the Shareholders, either by themselves or with the
Trustees, partners or members of a joint stock association.

SECTION 6.4. ISSUANCE OF SHARES. The Trustees, in their discretion may,
from time to time without vote of the Shareholders, issue Shares, in addition to
the then issued and outstanding Shares and Shares held in the treasury, to such
party or parties and for such amount and type of consideration, including cash
or property, and on such terms as the Trustees may deem best, and may in such
manner acquire other assets (including the acquisition of assets subject to, and
in connection, with the assumption of liabilities) and businesses. In connection
with any issuance of Shares, the Trustees may issue fractional Shares. The
Trustees may from time to time divide or combine the Shares of any series into a
greater or lesser number without thereby changing their proportionate beneficial
interests in Trust Property allocated or belonging to such series. Contributions
to the Trust may be accepted for, and Shares shall be redeemed as, whole Shares
and/or fractions of a Share.

SECTION 6.5. REGISTER OF SHARES. A register or registers shall be kept
at the principal office of the Trust or at an office of the Transfer Agent or
any one or more Shareholder Servicing Agents which register or registers, taken
together, shall contain the names and addresses of the Shareholders and the
number of Shares held by them respectively and a record of all transfers
thereof. Such register or registers shall be conclusive as to who are the
holders of the Shares and who shall be entitled to receive dividends or
distributions or otherwise to exercise or enjoy the rights of Shareholders. No
Shareholder shall be entitled to receive payment of any dividend or
distribution, nor to have notice given to him as herein or in the By-Laws
provided, until he has given his address to the Transfer Agent, the Shareholder
Servicing Agent which is the agent of record for such Shareholder, or such other
officer or agent of the Trustees as shall keep the said register for entry
thereon. It is not contemplated that certificates will be issued for the Shares;
however, the Trustees, in their discretion, may authorize the issuance of Share
certificates and promulgate appropriate rules and regulations as to their use.

SECTION 6.6. TRANSFER OF SHARES. Shares shall be transferable on the
records of the Trust only by the record holder thereof or by his agent thereunto
duly authorized in writing, upon delivery to the Trustees, the Transfer Agent or
the Shareholder Servicing Agent which is the agent of record for such
Shareholder, of a duly executed instrument of transfer, together with any
certificate or certificates (if issued) for such Shares and such evidence of the
genuineness of each such execution and authorization and of other matters as may
reasonably be required. Upon such delivery the transfer shall be recorded on the
register of the Trust. Until such record is made, the Shareholder of record
shall be deemed to be the holder of such Shares for all purposes hereunder and
neither the Trustees nor any Transfer Agent, Shareholder Servicing Agent or
registrar nor any officer, employee or agent of the Trust shall be affected by
any notice of the proposed transfer.

Any person becoming entitled to any Shares in consequence of the death,
bankruptcy, or incompetence of any Shareholder, or otherwise by operation of
law, shall be recorded on the register of Shares as the holder of such Shares
upon production of the proper evidence thereof to the Trustees, the Transfer
Agent or

<PAGE>

the Shareholder Servicing Agent which is the agent of record for such
Shareholder; but until such record is made, the Shareholder of record shall be
deemed to be the holder of such Shares for all purposes hereunder and neither
the Trustees nor any Transfer Agent, Shareholder Servicing Agent or registrar
nor any officer or agent of the Trust shall be affected by any notice of such
death, bankruptcy or incompetence, or other operation of law.

SECTION 6.7. NOTICES. Any and all notices to which any Shareholder may
be entitled and any and all communications shall be deemed duly served or given
if mailed, postage prepaid, addressed to any Shareholder of record at his last
known address as recorded on the register of the Trust.

SECTION 6.8. VOTING POWERS. The Shareholders shall have power to vote
only (i) for the removal of Trustees as provided in Section 2.2 hereof, (ii)
with respect to any investment advisory or management contract as provided in
Section 4.1 hereof, (iii) with respect to termination of the Trust as provided
in Section 9.2 hereof, (iv) with respect to any amendment of this Declaration to
the extent and as provided in Section 9.3 hereof, (v) with respect to any
merger, consolidation or sale of assets as provided in Sections 9.4 and 9.6
hereof, (vi) with respect to incorporation of the Trust or any series to the
extent and as provided in Sections 9.5 and 9.6 hereof, (vii) to the same extent
as the stockholders of a Massachusetts business corporation as to whether or not
a court action, proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the Trust or the
Shareholders, and (viii) with respect to such additional matters relating to the
Trust as may be required by the Declaration, the By-Laws or any registration of
the Trust with the Commission (or any successor agency) or any state, or as the
Trustees may consider necessary or desirable. Each whole Share shall be entitled
to one vote as to any matter on which it is entitled to vote and each fractional
Share shall be entitled to a proportionate fractional vote, except that Shares
held in the treasury of the Trust shall not be voted. Shares shall be voted by
individual series on any matter submitted to a vote of the Shareholders of the
Trust except as provided in Section 6.9(g) hereof. There shall be no cumulative
voting in the election of Trustees. Until Shares are issued, the Trustees may
exercise all rights of Shareholders and may take any action required by law, the
Declaration or the By-Laws to be taken by Shareholders. At any meeting of
Shareholders of the Trust or of any series of the Trust, a Shareholder Servicing
Agent may vote any shares as to which such Shareholder Servicing Agent is the
agent of record and which are not otherwise represented in person or by proxy at
the meeting, proportionately in accordance with the votes cast by holders of all
shares otherwise represented at the meeting in person or by proxy as to which
such Shareholder Servicing Agent is the agent of record. Any shares so voted by
a Shareholder Servicing Agent will be deemed represented at the meeting for
quorum purposes. The By-Laws may include further provisions for Shareholder
votes and meetings and related matters.

SECTION 6.9. SERIES DESIGNATION. As set forth in Appendix I hereto, the
Trustees have authorized the division of Shares into series, as designated and
established pursuant to the provisions of Appendix I and this Section 6.9. The
Trustees, in their discretion, may authorize the division of Shares into one or
more additional series, and the different series shall be established and
designated, and the variations in the relative rights, privileges and
preferences

<PAGE>

as between the different series shall be fixed and determined by the Trustees
upon and subject to the following provisions:

(a) All Shares shall be identical except that there may be such
variations as shall be fixed and determined by the Trustees between different
series as to purchase price, right of redemption and the price, terms and manner
of redemption, and special and relative rights as to dividends and on
liquidation.

(b) The number of authorized Shares and the number of Shares of each
series that may be issued shall be unlimited. The Trustees may classify or
reclassify any unissued Shares or any Shares previously issued and reacquired of
any series into one or more series that may be established and designated from
time to time. The Trustees may hold as treasury shares (of the same or some
other series), reissue for such consideration and on such terms as they may
determine, or cancel any Shares of any series reacquired by the Trust at their
discretion from time to time.

(c) All consideration received by the Trust for the issuance or sale of
Shares of a particular series, together with all assets in which such
consideration is invested or reinvested, all income and earnings thereon,
profits therefrom, and proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds or payments derived
from any reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that series for all purposes, subject only to the rights
of creditors of such series, and shall be so recorded upon the books of account
of the Trust. In the event that there are any assets, income, earnings, profits,
proceeds, funds or payments which are not readily identifiable as belonging to
any particular series, the Trustees shall allocate them to and among any one or
more of the series established and designated from time to time in such manner
and on such basis as the Trustees, in their sole discretion, deem fair and
equitable. Each such allocation by the Trustees shall be conclusive and binding
upon the Shareholders of all series for all purposes. No Shareholder of any
particular series shall have any claim on or right to any assets allocated or
belonging to any other series of Shares.

(d) The assets belonging to each particular series shall be charged
with the liabilities of the Trust in respect of that series and all expenses,
costs, charges and reserves attributable to that series, and any general
liabilities, expenses, costs, charges or reserves of the Trust which are not
readily identifiable as belonging to any particular series shall be allocated
and charged by the Trustees to and among any one or more of the series
established and designated from time to time in such manner and on such basis as
the Trustees, in their sole discretion, deem fair and equitable. Each allocation
of liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all series for all purposes. The
Trustees shall have full discretion, to the extent not inconsistent with the
1940 Act, to determine which items shall be treated as income and which items as
capital; and each such determination and allocation shall be conclusive and
binding upon the Shareholders. Under no circumstances shall the assets allocated
or belonging to any particular series be charged with liabilities, expenses,
costs, charges or reserves attributable to any other series. All Persons who
have extended credit which has been allocated to a particular series, or who
have

<PAGE>

a claim or contract which has been allocated to any particular series, shall
look only to the assets of that particular series for payment of such credit,
claim or contract.

(e) The power of the Trustees to invest and reinvest the Trust Property
allocated or belonging to any particular series shall be governed by Section 3.2
hereof unless otherwise provided in the instrument of the Trustees establishing
such series which is hereinafter described.

(f) Each Share of a series shall represent a beneficial interest in the
net assets allocated or belonging to such series only, and such interest shall
not extend to the assets of the Trust generally. Dividends and distributions on
Shares of a particular series may be paid with such frequency as the Trustees
may determine, which may be monthly or otherwise, pursuant to a standing vote or
votes adopted only once or with such frequency as the Trustees may determine, to
the Shareholders of that series only, from such of the income and capital gains,
accrued or realized, from the assets belonging to that series, as the Trustees
may determine, after providing for actual and accrued liabilities belonging to
that series. All dividends and distributions on Shares of a particular series
shall be distributed PRO RATA to the Shareholders of that series in proportion
to the number of Shares of that series held by such Shareholders at the date and
time of record established for the payment of such dividends or distributions.
Shares of any particular series of the Trust may be redeemed solely out of Trust
Property allocated or belonging to that series. Upon liquidation or termination
of a series of the Trust, Shareholders of such series shall be entitled to
receive a PRO RATA share of the net assets of such series only.

(g) Notwithstanding any provision hereof to the contrary, on any matter
submitted to a vote of the Shareholders of the Trust, all Shares then entitled
to vote shall be voted by individual series, except that (i) when required by
the 1940 Act to be voted in the aggregate, Shares shall not be voted by
individual series, and (ii) when the Trustees have determined that the matter
affects only the interests of Shareholders of one or more series, only
Shareholders of such series shall be entitled to vote thereon.

(h) The establishment and designation of any series of Shares shall be
effective upon the execution by a majority of the Trustees of an instrument
setting forth such establishment and designation and the relative rights and
preferences of such series, or as otherwise provided in such instrument. At any
time that there are no Shares outstanding of any particular series previously
established and designated, the Trustees may by an instrument executed by a
majority of their number abolish that series and the establishment and
designation thereof. Each instrument referred to in this paragraph shall have
the status of an amendment to this Declaration.

(i) Notwithstanding anything in this Declaration to the contrary, the
Trustees may, in their discretion, authorize the division of Shares of any
series into Shares of one or more classes or subseries of such series. All
Shares of a class or a subseries shall be identical with each other and with the
Shares of each other class or subseries of the same series except for such
variations between classes or subseries as may be approved by the Board of
Trustees and be

<PAGE>

permitted under the 1940 Act or pursuant to any exemptive order issued by the
Commission.

ARTICLE VII

REDEMPTIONS

SECTION 7.L REDEMPTIONS. In case any Shareholder at any time desires to
dispose of his Shares, he may deposit his certificate or certificates therefor,
duly endorsed in blank or accompanied by an instrument of transfer executed in
blank, or if the Shares are not represented by any certificate, a written
request or other such form of request as the Trustees may from time to time
authorize, at the office of the Transfer Agent, the Shareholder Servicing Agent
which is the agent of record for such Shareholder, or at the office of any bank
or trust company, either in or outside of the Commonwealth of Massachusetts,
which is a member of the Federal Reserve System and which the said Transfer
Agent or the said Shareholder Servicing Agent has designated in writing for that
purpose, together with an irrevocable offer in writing in a form acceptable to
the Trustees to sell the Shares represented thereby to the Trust at the net
asset value per Share thereof, next determined after such deposit as provided in
Section 8.1 hereof. Payment for said Shares shall be made to the Shareholder
within seven days after the date on which the deposit is made, unless (i) the
date of payment is postponed pursuant to Section 7.2 hereof, or (ii) the
receipt, or verification of receipt, of the purchase price for the Shares to be
redeemed is delayed, in either of which events payment may be delayed beyond
seven days.

SECTION 7.2 SUSPENSION OF RIGHT OF REDEMPTION. The Trust may declare a
suspension of the right of redemption or postpone the date of payment of the
redemption proceeds for the whole or any part of any period (i) during which the
New York Stock Exchange is closed other than customary week-end and holiday
closings, (ii) during which trading on the New York Stock Exchange is
restricted, (iii) during which an emergency exists as a result of which disposal
by the Trust of securities owned by it is not reasonably practicable or it is
not reasonably practicable for the Trust fairly to determine the value of its
net assets, or (iv) during which the Commission for the protection of
Shareholders by order permits the suspension of the right of redemption or
postponement of the date of payment of the redemption proceeds; provided that
applicable rules and regulations of the Commission shall govern as to whether
the conditions prescribed in (ii), (iii) or (iv) exist. Such suspension shall
take effect at such time as the Trust shall specify but not later than the close
of business on the business day next following the declaration of suspension,
and thereafter there shall be no right of redemption or payment of the
redemption proceeds until the Trust shall declare the suspension at an end,
except that the suspension shall terminate in any event on the first day on
which said stock exchange shall have reopened or the period specified in (ii) or
(iii) shall have expired (as to which, in the absence of an official ruling by
the Commission, the determination of the Trust shall be conclusive). In the case
of a suspension of the right of redemption, a Shareholder may either withdraw
his request for redemption or receive payment based on the net asset value
existing after the termination of the suspension.

<PAGE>

SECTION 7.3. REDEMPTION OF SHARES; DISCLOSURE OF HOLDING. If the
Trustees shall, at any time and in good faith, be of the opinion that direct or
indirect ownership of Shares has or may become concentrated in any Person to an
extent which would disqualify the Trust, or any series of the Trust, as a
regulated investment company under the Internal Revenue Code of 1986, as amended
(the "Code"), then the Trustees shall have the power by lot or other means
deemed equitable by them (i) to call for redemption by any such Person a number
of Shares of the Trust, or such series of the Trust, sufficient to maintain or
bring the direct or indirect ownership of Shares of the Trust, or such series of
the Trust, into conformity with the requirements for such qualification, and
(ii) to refuse to transfer or issue Shares of the Trust, or such series of the
Trust, to any Person whose acquisition of the Shares of the Trust, or such
series of the Trust, would result in such disqualification. The redemption shall
be effected at the redemption price and in the manner provided in Section 7.1
hereof.

The Shareholders of the Trust shall upon demand disclose to the
Trustees in writing such information with respect to direct and indirect
ownership of Shares of the Trust as the Trustees deem necessary to comply with
the provisions of the Code, or to comply with the requirements of any other
authority. Upon the failure of a Shareholder to disclose such information and to
comply with such demand of the Trustees, the Trust shall have the power to
redeem such Shares at a redemption price determined in accordance with Section
7.1 hereof.

SECTION 7.4 REDEMPTIONS OF ACCOUNTS OF LESS THAN MINIMUM AMOUNT. The
Trustees shall have the power, and any Shareholder Servicing Agent with whom the
Trust has so agreed (or a subcontractor of such Shareholder Servicing Agent)
shall have the power, at any time to redeem Shares of any Shareholder at a
redemption price determined in accordance with Section 7.1 hereof if at such
time the aggregate net asset value of the Shares owned by such Shareholder is
less than a minimum amount as determined from time to time and disclosed in a
prospectus of the Trust or in the Shareholder Servicing Agent's (or sub-
contractor's) agreement with its customer. A Shareholder shall be notified that
the aggregate value of his Shares is less than such minimum amount and allowed
60 days to make an additional investment before redemption is processed.

ARTICLE VIII

DETERMINATION OF NET ASSET VALUE,
NET INCOME AND DISTRIBUTIONS

The Trustees, in their absolute discretion, may prescribe and shall set
forth in the By-Laws or in a duly adopted vote or votes of the Trustees such
bases and times for determining the per Share net asset value of the Shares or
net income, or the declaration and payment of dividends and distributions, as
they may deem necessary or desirable.

<PAGE>

ARTICLE IX

DURATION; TERMINATION OF TRUST;
AMENDMENT; MERGERS, ETC.

SECTION 9.1. DURATION. The Trust shall continue without limitation of
time but subject to the provisions of this Article IX.

SECTION 9.2. TERMINATION OF TRUST. (a) The Trust may be terminated (i)
by a Majority Shareholder Vote of its Shareholders, or (ii) by the Trustees by
written notice to the Shareholders. Any series of the Trust may be terminated
(i) by a Majority Shareholder Vote of the Shareholders of that series, or (ii)
by the Trustees by written notice to the Shareholders of that series. Upon the
termination of the Trust or any series of the Trust:

(i) The Trust or series of the Trust shall carry on no business except
for the purpose of winding up its affairs;

(ii) The Trustees shall proceed to wind up the affairs of the Trust or
series of the Trust and all the powers of the Trustees under this Declaration
shall continue until the affairs of the Trust or series of the Trust shall have
been wound up, including the power to fulfill or discharge the contracts of the
Trust, collect the assets of the Trust or series of the Trust, sell, convey,
assign, exchange, transfer or otherwise dispose of all or any part of the
remaining Trust Property of the Trust or series of the Trust to one or more
Persons at public or private sale for consideration which may consist in whole
or in part of cash, securities or other property of any kind, discharge or pay
the liabilities of the Trust or series of the Trust, and to do all other acts
appropriate to liquidate the business of the Trust or series of the Trust;
provided, that any sale, conveyance, assignment, exchange, transfer or other
disposition of all or substantially all of the Trust Property of the Trust or
series of the Trust shall require Shareholder approval in accordance with
Section 9.4 or 9.6 hereof, respectively; and

(iii) After paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities and refunding
agreements as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property of the Trust or series of the Trust, in
cash or in kind or partly in cash and partly in kind, among the Shareholders of
the Trust or series of the Trust according to their respective rights.

(b) After termination of the Trust or series of the Trust and
distribution to the Shareholders of the Trust or series of the Trust as herein
provided, a majority of the Trustees shall execute and lodge among the records
of the Trust an instrument in writing setting forth the fact of such
termination, and the Trustees shall thereupon be discharged from all further
liabilities and duties hereunder with respect to the Trust or series of the
Trust, and the rights and interests of all Shareholders of the Trust or series
of the Trust shall thereupon cease.

SECTION 9.3. AMENDMENT PROCEDURE. (a) This Declaration may be amended
by a Majority Shareholder Vote of the Shareholders or by any instrument in

<PAGE>

writing, without a meeting, signed by a majority of the Trustees and consented
to by the holders of not less than a majority of the Shares of the Trust. The
Trustees may also amend this Declaration without the vote or consent of
Shareholders to designate series in accordance with Section 6.9 hereof, to
change the name of the Trust, to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or to
conform this Declaration to the requirements of applicable federal laws or
regulations or the requirements of the regulated investment company provisions
of the Internal Revenue Code of 1986, as amended, or to (i) change the state or
other jurisdiction designated herein as the state or other jurisdiction whose
laws shall be the governing law hereof, (ii) effect such changes herein as the
Trustees find to be necessary or appropriate (A) to permit the filing of this
Declaration under the laws of such state or other jurisdiction applicable to
trusts or voluntary associations, (B) to permit the Trust to elect to be treated
as a "regulated investment company" under the applicable provisions of the
Internal Revenue Code of 1986, as amended, or (C) to permit the transfer of
shares (or to permit the transfer of any other beneficial interests or shares in
the Trust, however denominated), and (iii) in conjunction with any amendment
contemplated by the foregoing clause (i) or the foregoing clause (ii) to make
any and all such further changes or modifications to this Declaration as the
Trustees find to be necessary or appropriate, any finding of the Trustees
referred to in the foregoing clause (ii) or clause (iii) to be conclusively
evidenced by the execution of any such amendment by a majority of the Trustees,
but the Trustees shall not be liable for failing so to do.

(b) No amendment which the Trustees have determined would affect the
rights, privileges or interests of holders of a particular series of Shares, but
not the rights, privileges or interests of holders of all series of Shares
generally, and which would otherwise require a Majority Shareholder Vote under
paragraph (a) of this Section 9.3, may be made except with the vote or consent
by a Majority Shareholder Vote of Shareholders of such series.

(d) Notwithstanding any other provision hereof, no amendment may be
made under this Section 9.3 which would change any rights with respect to the
Shares, or any series of Shares, by reducing the amount payable thereon upon
liquidation of the Trust or by diminishing or eliminating any voting rights
pertaining thereto, except with the Majority Shareholder Vote of the Shares or
that series of Shares. Nothing contained in this Declaration shall permit the
amendment of this Declaration to impair the exemption from personal liability of
the Shareholders, Trustees, officers, employees and agents of the Trust or to
permit assessments upon Shareholders.

(e) A certificate signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Shareholders or by the

<PAGE>

Trustees as aforesaid, and executed by a majority of the Trustees, shall be
conclusive evidence of such amendment when lodged among the records of the
Trust.

(f) Notwithstanding any other provision hereof, until such time as a
Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of Shares of the Trust shall have become effective,
this Declaration may be amended in any respect by the affirmative vote of a
majority of the Trustees or by an instrument signed by a majority of the
Trustees.

SECTION 9.4. MERGER, CONSOLIDATION AND SALE OF ASSETS. The Trust may
merge or consolidate with any other corporation, association, trust or other
organization or may sell, lease or exchange all or substantially all of the
Trust Property (or all or substantially all of the Trust Property allocated or
belonging to a particular series of the Trust) including its good will, upon
such terms and conditions and for such consideration when and as authorized at
any meeting of Shareholders called for such purpose by the vote of the holders
of two-thirds of the outstanding Shares of all series of the Trust voting as a
single class, or of the affected series of the Trust, as the case may be, or by
an instrument or instruments in writing without a meeting, consented to by the
vote of the holders of two-thirds of the outstanding Shares of all series of the
Trust voting as a single class, or of the affected series of the Trust, as the
case may be; provided, however, that if such merger, consolidation, sale, lease
or exchange is recommended by the Trustees, the vote or written consent by
Majority Shareholder Vote shall be sufficient authorization; and any such
merger, consolidation, sale, lease or exchange shall be deemed for all purposes
to have been accomplished under and pursuant to the statutes of the Commonwealth
of Massachusetts. Nothing contained herein shall be construed as requiring
approval of Shareholders for any sale of assets in the ordinary course of the
business of the Trust.

SECTION 9.5. INCORPORATION, REORGANIZATION. With the approval of the
holders of a majority of the Shares outstanding and entitled to vote, the
Trustees may cause to be organized or assist in organizing a corporation or
corporations under the laws of any jurisdiction, or any other trust, unit
investment trust, partnership, association or other organization to take over
all of the Trust Property or to carry on any business in which the Trust shall
directly or indirectly have any interest, and to sell, convey and transfer the
Trust Property to any such corporation, trust, partnership, association or
organization in exchange for the shares or securities thereof or otherwise, and
to lend money to, subscribe for the shares or securities of, and enter into any
contracts with any such corporation, trust, partnership, association or
organization in which the Trust holds or is about to acquire shares or any other
interest. Subject to Section 9.4 hereof, the Trustees may also cause a merger or
consolidation between the Trust or any successor thereto and any such
corporation, trust, partnership, association or other organization if and to the
extent permitted by law. Nothing contained in this Section 9.5 shall be
construed as requiring approval of Shareholders for the Trustees to organize or
assist in organizing one or more corporations, trusts, partnerships,
associations or other organizations and selling, conveying or transferring a
portion of the Trust Property to such organization or entities.

<PAGE>

SECTION 9.6. INCORPORATION OR REORGANIZATION OF SERIES. With the
approval of a Majority Shareholder Vote of any series, the Trustees may sell,
lease or exchange all of the Trust Property allocated or belonging to that
series, or cause to be organized or assist in organizing a corporation or
corporations under the laws of any other jurisdiction, or any other trust, unit
investment trust, partnership, association or other organization, to take over
all of the Trust Property allocated or belonging to that series and to sell,
convey and transfer such Trust Property to any such corporation, trust, unit
investment trust, partnership, association, or other organization in exchange
for the shares or securities thereof or otherwise.

ARTICLE X

REPORTS TO SHAREHOLDERS AND SHAREHOLDER COMMUNICATIONS

The Trustees shall at least semi-annually submit to the Shareholders a
written financial report of the transactions of the Trust, including financial
statements which shall at least annually be certified by independent public
accountants.

ARTICLE XI

MISCELLANEOUS

SECTION 11.1. FILING. This Declaration and any amendment hereto shall
be filed in the office of the Secretary of the Commonwealth of Massachusetts and
in such other place or places as may be required under the laws of the
Commonwealth of Massachusetts and may also be filed or recorded in such other
places as the Trustees deem appropriate. Each amendment so filed shall state or
be accompanied by a certificate signed and acknowledged by a Trustee stating
that such action was duly taken in the manner provided herein, and unless such
amendment or such certificate sets forth some later time for the effectiveness
of such amendment, such amendment shall be effective upon its filing. A restated
Declaration, integrating into a single instrument all of the provisions of the
Declaration which are then in effect and operative, may be executed from time to
time by a majority of the Trustees and shall, upon filing with the Secretary of
the Commonwealth of Massachusetts, be conclusive evidence of all amendments
contained therein and may thereafter be referred to in lieu of this original
Declaration and the various amendments thereto.

SECTION 11.2. GOVERNING LAW. This Declaration is executed by the
Trustees and delivered in the Commonwealth of Massachusetts and with reference
to the laws thereof, and the rights of all parties and the validity and
construction of every provision hereof shall be subject to and construed
according to the laws of said Commonwealth.

SECTION 11.3. COUNTERPARTS. This Declaration may be simultaneously
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts, together, shall constitute one and the same
instrument, which shall be sufficiently evidenced by any such original
counterpart.

<PAGE>

SECTION 11.4. RELIANCE BY THIRD PARTIES. Any certificate executed by an
individual who, according to the records of the Trust, is a Trustee hereunder
certifying to: (i) the number or identity of Trustees or Shareholders, (ii) the
due authorization of the execution of any instrument or writing, (iii) the form
of any vote passed at a meeting of Trustees or Shareholders, (iv) the fact that
the number of Trustees or Shareholders present at any meeting or executing any
written instrument satisfies the requirements of this Declaration, (v) the form
of any By-Laws adopted by or the identity of any officers elected by the
Trustees, or (vi) the existence of any fact or facts which in any manner relates
to the affairs of the Trust, shall be conclusive evidence as to the matters so
certified in favor of any Person dealing with the Trustees and their successors.

SECTION 11.5. PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS. (a) The
provisions of this Declaration are severable, and if the Trustees shall
determine, with the advice of counsel, that any such provision is in conflict
with the 1940 Act, the regulated investment company provisions of the Internal
Revenue Code of 1986, as amended, or with other applicable laws and regulations,
the conflicting provision shall be deemed never to have constituted a part of
this Declaration; provided however, that such determination shall not affect any
of the remaining provisions of this Declaration or render invalid or improper
any action taken or omitted prior to such determination.

(b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of the
Declaration in any jurisdiction.

SECTION 11.6. PRINCIPAL OFFICE. The principal office of the Trust is
6 St. James Avenue, 9th Floor, Boston, Massachusetts, 02116.

<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this instrument as of
the 16th day of September, 1994.

/S/Philip W. Coolidge
Philip W. Coolidge
as Trustee
and not individually

6 St. James Avenue
Boston, Massachusetts

/S/James B. Craver
James B. Craver
as Trustee
and not individually

6 St. James Avenue
Boston, Massachusetts

/S/Thomas M. Lenz
Thomas M. Lenz
as Trustee
and not individually

6 St. James Avenue
Boston, Massachusetts

JPM322

<PAGE>

COMMONWEALTH OF MASSACHUSETTS

SUFFOLK, SS.

September 16, 1994

Then personally appeared the above-named Philip W. Coolidge, James B.
Craver and Thomas M. Lenz, who severally acknowledged the foregoing instrument
to be their free act and deed.

Before me,

Notary Public

My commission expires: January 24, 1997

<PAGE>

JPM322 Appendix I

THE JPM ADVISORY FUNDS

Establishment and
Designation of Series of Shares of
Beneficial Interest (par value $0.001 per share)

Pursuant to Section 6.9 of Declaration of Trust, dated as of September
16, 1994 (the "Declaration of Trust"), of The JPM Advisory Funds (the "Trust"),
the Trustees of the Trust hereby establish and designate nine initial series of
Shares (as defined in the Declaration of Trust) (each such series a "Fund" and
collectively the "Funds") to have the following special and relative rights:

1. The Funds shall be designated as follows:

The JPM Advisory Bond Fund
The JPM Advisory International Bond Fund
The JPM Advisory Selected U.S. Equity Fund
The JPM Advisory U.S. Small Company Fund
The JPM Advisory International Equity Fund
The JPM Advisory Emerging Markets Equity Fund
The JPM Advisory Asia Growth Fund
The JPM Advisory European Equity Fund
The JPM Advisory Japan Equity Fund

2. Each Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Trust's then currently effective registration statement
under the Securities Act of 1933 to the extent pertaining to the offering of
Shares of such Fund. Each Share of a Fund shall be redeemable, shall be entitled
to one vote (or fraction thereof in respect of a fractional share) on matters on
which Shares of the Fund shall be entitled to vote, shall represent a PRO RATA
beneficial interest in the assets allocated or belonging to the Fund, and shall
be entitled to receive its PRO RATA share of the net assets of the Fund upon
liquidation of the Fund, all as provided in Section 6.9 of the Declaration of
Trust. The proceeds of sales of Shares of a Fund, together with any income and
gain thereon, less any diminution or expenses thereof, shall irrevocably belong
to that Fund, unless otherwise required by law.

3. Shareholders of each Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Declaration of Trust.

4. The assets and liabilities of the Trust shall be allocated among the
Funds as set forth in Section 6.9 of the Declaration of Trust.

5. Subject to the provisions of Section 6.9 and Article IX of the
Declaration of Trust, the Trustees (including any successor Trustees) shall have
the right at any time and from time to time to reallocate assets and expenses,
to change the designation of any Fund now or hereafter created, or otherwise to
change the special and relative rights of any Fund.

<PAGE>

JPM322
THE JPM ADVISOR FUNDS
(formerly The JPM Advisory Funds)

AMENDMENT NO. 1 TO DECLARATION OF TRUST AND
FIRST AMENDED AND RESTATED ESTABLISHMENT AND DESIGNATION OF SERIES OF
SHARES OF BENEFICIAL INTEREST (PAR VALUE $0.001 PER SHARE)

Dated September 28, 1994

The undersigned, being the Trustees of The JPM Advisory Funds, a
Massachusetts business trust (the "Trust"), acting pursuant to Article IX,
Sections 9.3(a) and 9.3(f) of the Trust's Declaration of Trust dated as of
September 16, 1994 (the "Declaration"), hereby amend and restate the first
sentence of Section 1.1. of the Declaration to read in its entirety "The name of
the trust is "The JPM Advisor Funds"."

Pursuant to Article VI, Section 6.9 of the Declaration, the Trustees of
the Trust hereby amend and restate the Establishment and Designation of Series
appended to the Declaration to change the names of the nine initial series of
Shares (as defined in the Declaration) (each a "Fund" and collectively the
"Funds") of the Trust.

1. The Funds shall be redesignated as follows:

The JPM Advisor U.S. Fixed Income
The JPM Advisor International Fixed Income Fund
The JPM Advisor U.S. Equity Fund
The JPM Advisor U.S. Small Cap Equity Fund
The JPM Advisor International Equity Fund
The JPM Advisor Emerging Markets Equity Fund
The JPM Advisor Asia Growth Fund
The JPM Advisor European Equity Fund
The JPM Advisor Japan Equity Fund

and shall have the following special and relative rights:

2. Each Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Trust's then currently effective registration statement
under the Securities Act of 1933 to the extent pertaining to the offering of
Shares of such Fund. Each Share of a Fund shall be redeemable, shall be entitled
to one vote (or fraction thereof in respect of a fractional share) on matters on
which Shares of the Fund shall be entitled to vote, shall represent a PRO RATA
beneficial interest in the assets allocated or belonging to the Fund, and shall
be entitled to receive its PRO RATA share of the net assets of the Fund upon
liquidation of the Fund, all as provided in Section 6.9 of the Declaration. The
proceeds of sales of Shares of a Fund, together with any income and gain
thereon, less any diminution or expenses thereof, shall irrevocably belong to
that Fund, unless otherwise required by law.

3. Shareholders of each Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been

<PAGE>

effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Declaration.

4. The assets and liabilities of the Trust shall be allocated among the
Funds as set forth in Section 6.9 of the Declaration.

5. Subject to the provisions of Section 6.9 and Article IX of the
Declaration, the Trustees (including any successor Trustees) shall have the
right at any time and from time to time to reallocate assets and expenses, to
change the designation of any Fund or any other series previously, now or
hereafter created, or otherwise to change the special and relative rights of any
Fund or any such other series.

IN WITNESS WHEREOF, the undersigned have executed this instrument as of
the 28th day of September, 1994. This instrument may be executed by the Trustees
on separate counterparts but shall be effective only when signed by a majority
of the Trustees.

/S/Philip W. Coolidge
Philip W. Coolidge

/S/James B. Craver
James B. Craver

/S/Thomas M. Lenz
Thomas M. Lenz

THE JPM ADVISOR FUNDS

AMENDMENT NO. 2 TO DECLARATION OF TRUST

Dated March 6, 1995

The undersigned being a majority of the Trustees of the JPM Advisor
Funds, a Massachusetts business trust (the "Trust"), acting pursuant to Article
IX, Sections 9.3(a) and 9.3(f) of the Trust's Declaration of Trust dated as of
September 16, 1994 and amended September 28, 1994 (the "Declaration"), hereby
amend and restate Section 2.2. of the Declaration in its entirety to read as
follows:

SECTION 2.2. TERM OF OFFICE OF TRUSTEES. Subject to the provisions of
Section 16(a) of the 1940 Act, each Trustee may hold office for two terms of
five-consecutive years during the lifetime of this Trust and until its
termination as hereinafter provided; except that (a) any Trustee may resign his
trust (without need for prior or subsequent accounting) by an instrument in
writing signed by him and delivered to the other Trustees, which shall take
effect upon such delivery or upon such later date as is specified therein; (b)
any Trustee may be removed with cause, at any time by written instrument signed
by at least two-thirds of the remaining Trustees, specifying the date when such
removal shall become effective; (c) any Trustee who has attained the mandatory
retirement age of 70 shall, automatically and without action of such Trustee or
the remaining Trustees, be deemed to have retired, effective on the date of that
Trustee's 70th birthday; (d) any Trustee who has become incapacitated by illness
or injury as determined by a majority of the other Trustees, may be retired by
written instrument signed by a majority of the other Trustees, specifying the
date of his retirement; and (e) a Trustee may be removed at any meeting of
Shareholders by a vote of two thirds of the outstanding Shares of each series.
Any Trustee who has served two-five year terms (whether such terms are
consecutive or nonconsecutive) shall, automatically and without action of such
Trustee or the remaining Trustees, be deemed to have retired, effective on the
last day of the second term. For purposes of the foregoing clause (b), the term
"cause" shall include, but not be limited to, failure to comply with such
written policies as may from time to time be adopted by at least two thirds of
the Trustees with respect to the conduct of Trustees and attendance at meetings.
Upon the resignation, retirement or removal of a Trustee, or his otherwise
ceasing to be a Trustee, he shall execute and deliver such documents as the
remaining Trustees shall require for the purpose of conveying to the Trust or
the remaining Trustees any Trust Property held in the name of the resigning,
retiring or removed Trustee. Upon the incapacity or death of any Trustee, his
legal representative shall execute and deliver on his behalf such documents as
the remaining Trustees shall require as provided in the preceding sentence.

<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this instrument as of
the 6th day of March, 1995. This instrument may be executed by the Trustees on
separate counterparts but shall be effective only when signed by a majority of
the Trustees.

/S/Philip W. Coolidge
Philip W. Coolidge
As Trustee and not individually

/S/James B. Craver
James B. Craver
As Trustee and not individually

/S/Thomas M. Lenz
Thomas M. Lenz
As Trustee and not individually

JPM322

BY-LAWS
OF
THE JPM ADVISOR FUNDS

ARTICLE I

DEFINITIONS

The terms "COMMISSION", "DECLARATION", "DISTRIBUTOR", "INVESTMENT
ADVISER", "MAJORITY SHAREHOLDER VOTE", "1940 ACT", "SHAREHOLDER", "SHARES",
"TRANSFER AGENT", "TRUST", "TRUST PROPERTY" and "TRUSTEES" have the respective
meanings given them in the Declaration of Trust of The JPM Advisor Funds dated
as of September 16, 1994, as amended September 28, 1994 and [December 15, 1994].

ARTICLE II

OFFICES

SECTION 1. PRINCIPAL OFFICE. Until changed by the Trustees, the
principal office of the Trust in the Commonwealth of Massachusetts shall be in
the City of Boston, County of Suffolk.

SECTION 2. OTHER OFFICES. The Trust may have offices in such other
places without as well as within the Commonwealth as the Trustees may from time
to time determine.

ARTICLE III

SHAREHOLDERS

SECTION 1. MEETINGS. A meeting of Shareholders may be called at any
time by a majority of the Trustees and shall be called by any Trustee upon
written request, which shall specify the purpose or purposes for which such
meeting is to be called, of Shareholders holding in the aggregate not less than
10% of the outstanding Shares entitled to vote on the matters specified in such
written request. Any such meeting shall be held within or without the
Commonwealth of Massachusetts on such day and at such time as the Trustees shall
designate. The holders of a majority of outstanding Shares entitled to vote
present in person or by proxy shall constitute a quorum at any meeting of the
Shareholders. In the absence of a quorum, a majority of outstanding Shares
entitled to vote present in person or by proxy may adjourn the meeting from time
to time until a quorum shall be present.

Whenever a matter is required to be voted by Shareholders of the Trust
in the aggregate under Section 6.8 and Section 6.9 and Section 6.9(g) of the
Declaration, the Trust may either hold a meeting of Shareholders of all series,

<PAGE>

as defined in Section 6.9 of the Declaration, to vote on such matter, or hold
separate meetings of shareholders of each of the individual series to vote on
such matter, PROVIDED THAT (i) such separate meetings shall be held within one
year of each other, (ii) a quorum consisting of the holders of the majority of
outstanding Shares of the individual series entitled to vote present in person
or by proxy shall be present at each such separate meeting and (iii) a quorum
consisting of the holders of a majority of all Shares of the Trust entitled to
vote present in person or by proxy shall be present in the aggregate at such
separate meetings, and the votes of Shareholders at all such separate meetings
shall be aggregated in order to determine if sufficient votes have been cast for
such matter to be voted.

SECTION 2. NOTICE OF MEETINGS Notice of all meetings of Shareholders,
stating the time, place and purposes of the meeting, shall be given by the
Trustees by mail to each Shareholder entitled to vote at such meeting at his
address as recorded on the register of the Trust, mailed at least 10 days and
not more than 60 days before the meeting. Only the business stated in the notice
of the meeting shall be considered at such meeting. Any adjourned meeting may be
held as adjourned without further notice. No notice need be given to any
Shareholder who shall have failed to inform the Trust of his current address or
if a written waiver of notice, executed before or after the meeting by the
Shareholder or his attorney thereunto authorized, is filed with the records of
the meeting.

Where separate meetings are held for Shareholders of each of the
individual series to vote on a matter required to be voted on by Shareholders of
the Trust in the aggregate, as provided in Article III, Section 1 above, notice
of each such separate meeting shall be provided in the manner described above in
this Section 2.

SECTION 3. RECORD DATE. For the purpose of determining the Shareholders
who are entitled to notice of and to vote at any meeting, or to participate in
any distribution, or for the purpose of any other action, the Trustees may from
time to time close the transfer books for such period, not exceeding 30 days, as
the Trustees may determine; or without closing the transfer books the Trustees
may fix a date not more than 60 days prior to the date of any meeting of
Shareholders or distribution or other action as a record date for the
determination of the persons to be treated as Shareholders of record for such
purpose.

Where separate meetings are held for Shareholders of each of the
individual series to vote on a matter required to be voted on by Shareholders of
the Trust in the aggregate, as provided in Article III, Section 1 above, the
record date of each such separate meeting shall be determined in the manner
described above in this Section 3.

SECTION 4. PROXIES. At any meeting of Shareholders, any holder of
Shares entitled to vote thereat may vote by proxy, provided that no proxy shall
be voted at any meeting unless it shall have been placed on file with the
Secretary, or with such other officer or agent of the Trust as the Secretary may
direct, for verification prior to the time at which such vote shall be taken.
Pursuant to a vote of a majority of the Trustees, proxies may be solicited in
the name of the

<PAGE>

Trust or one or more Trustees or officers of the Trust. Only Shareholders of
record shall be entitled to vote. Each full Share shall be entitled to one vote
and fractional Shares shall be entitled to a vote of such fraction. When any
Share is held jointly by several persons, any one of them may vote at any
meeting in person or by proxy in respect of such Share, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Share. A proxy purporting to be
executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving invalidity
shall rest on the challenger. If the holder of any such Share is a minor or a
person of unsound mind, and subject to guardianship or to the legal control of
any other person as regards the charge or management of such Share, such Share
may be voted by such guardian or such other person appointed or having such
control, and such vote may be given in person or by proxy.

SECTION 5. INSPECTION OF RECORDS. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
shareholders of a Massachusetts business corporation.

SECTION 6. ACTION WITHOUT MEETING. Any action which may be taken by
Shareholders may be taken without a meeting if a majority of Shareholders
entitled to vote on the matter (or such larger proportion thereof as shall be
required by law, the Declaration or these By-Laws for approval of such matter)
consent to the action in writing and the written consents are filed with the
records of the meetings of Shareholders. Such consent shall be treated for all
purposes as a vote taken at a meeting of Shareholders.

ARTICLE IV

TRUSTEES

SECTION 1. MEETINGS OF THE TRUSTEES. The Trustees may in their
discretion provide for regular or stated meetings of the Trustees. Notice of
regular or stated meetings need not be given. Meetings of the Trustees other
than regular or stated meetings shall be held whenever called by the Chairman or
by any Trustee. Notice of the time and place of each meeting other than regular
or stated meetings shall be given by the Secretary or an Assistant Secretary or
by the officer or Trustee calling the meeting and shall be mailed to each
Trustee at least two days before the meeting, or shall be telegraphed, cabled,
or wirelessed to each Trustee at his business address, or personally delivered
to him at least one day before the meeting. Notice of a meeting need not be
given to any Trustee if a written waiver of notice, executed by him before or
after the meeting, is filed with the records of the meeting, or to any Trustee
who attends the meeting without protesting prior thereto or at its commencement
the lack of notice to him. A notice or waiver of notice need not specify the
purpose of any meeting. The Trustees may meet by means of a telephone conference
circuit or similar communications equipment by means of which all persons
participating in the meeting can hear each other, which telephone conference
meeting shall be deemed to have been held at a place designated by the Trustees
at the meeting. Participation in a telephone conference meeting shall constitute
presence in

<PAGE>

person at such meeting. Any action required or permitted to be taken at any
meeting of the Trustees may be taken by the Trustees without a meeting if all
the Trustees consent to the action in writing and the written consents are filed
with the records of the Trustees' meetings. Such consents shall be treated as a
vote for all purposes.

SECTION 2. QUORUM AND MANNER OF ACTING. A majority of the Trustees
present in person at any regular or special meeting of the Trustees shall
constitute a quorum for the transaction of business at such meeting and (except
as otherwise required by law, the Declaration or these By-Laws) the act of a
majority of the Trustees present at any such meeting, at which a quorum is
present, shall be the act of the Trustees. In the absence of a quorum, a
majority of the Trustees present may adjourn the meeting from time to time until
a quorum shall be present. Notice of an adjourned meeting need not be given.

ARTICLE V

COMMITTEES AND ADVISORY BOARD

SECTION 1. EXECUTIVE AND OTHER COMMITTEES. The Trustees by vote of a
majority of all the Trustees may elect from their own number an Executive
Committee to consist of not less than three Trustees to hold office at the
pleasure of the Trustees. While the Trustees are not in session, the Executive
Committee shall have the power to conduct the current and ordinary business of
the Trust, including the purchase and sale of securities and the designation of
securities to be delivered upon redemption of Shares of the Trust, and such
other powers of the Trustees as the Trustees may, from time to time, delegate to
the Executive Committee except those powers which by law, the Declaration or
these By-Laws the Trustees are prohibited from so delegating. The Trustees may
also elect from their own number other Committees from time to time, the number
composing such Committees, the powers conferred upon the same (subject to the
same limitations as with respect to the Executive Committee) and the term of
membership on such Committees to be determined by the Trustees. The Trustees may
designate a chairman of any such Committee. In the absence of such designation a
Committee may elect its own chairman.

SECTION 2. MEETING, QUORUM AND MANNER OF ACTING. The Trustees may (i)
provide for stated meetings of any Committee, (ii) specify the manner of calling
and notice required for special meetings of any Committee, (iii) specify the
number of members of a Committee required to constitute a quorum and the number
of members of a Committee required to exercise specified powers delegated to
such Committee, (iv) authorize the making of decisions to exercise specified
powers by written assent of the requisite number of members of a Committee
without a meeting, and (v) authorize the members of a Committee to meet by means
of a telephone conference circuit.

Each Committee shall keep regular minutes of its meetings and records
of decisions taken without a meeting and cause them to be recorded in a book
designated for that purpose and kept in the office of the Trust.

<PAGE>

SECTION 3. ADVISORY BOARD. The Trustees may appoint an Advisory Board
to consist in the first instance of not less than three members. Members of such
Advisory Board shall not be Trustees or officers and need not be Shareholders. A
member of such Advisory Board shall hold office for such period as the Trustees
may by vote provide and may resign therefrom by a written instrument signed by
him which shall take effect upon its delivery to the Trustees. The Advisory
Board shall have no legal powers and shall not perform the functions of Trustees
in any manner, such Advisory Board being intended merely to act in an advisory
capacity. Such Advisory Board shall meet at such times and upon such notice as
the Trustees may by vote provide.

SECTION 4. CHAIRMAN. The Trustees may, by a majority vote of all the
Trustees, elect from their own number a Chairman, to hold office until his
successor shall have been duly elected and qualified. The Chairman shall not
hold any other office. The Chairman may be, but need not be, a Shareholder. The
Chairman shall preside at all meetings of the Trustees and shall have such other
duties as from time to time may be assigned to him by the Trustees.

ARTICLE VI

OFFICERS

SECTION 1. GENERAL PROVISIONS. The officers of the Trust shall be a
President, a Treasurer and a Secretary, each of whom shall be elected by the
Trustees. The Trustees may elect or appoint such other officers or agents as the
business of the Trust may require, including one or more Vice Presidents, one or
more Assistant Treasurers, and one or more Assistant Secretaries. The Trustees
may delegate to any officer or committee the power to appoint any subordinate
officers or agents.

SECTION 2. TERM OF OFFICE AND QUALIFICATIONS. Except as otherwise
provided by law, the Declaration or these By-Laws, the President, the Treasurer
and the Secretary shall hold office until his respective successor shall have
been duly elected and qualified, and all other officers shall hold office at the
pleasure of the Trustees. The Secretary and Treasurer may be the same person. A
Vice President and the Treasurer or a Vice President and the Secretary may be
the same person, but the offices of Vice President, Secretary and Treasurer
shall not be held by the same person. The President shall not hold any other
office. Except as above provided, any two offices may be held by the same
person. Any officer may be, but does not need be, a Trustee or Shareholder.

SECTION 3. REMOVAL. The Trustees, at any regular or special meeting of
the Trustees, may remove any officer with or without cause by a vote of a
majority of the Trustees. Any officer or agent appointed by any officer or
committee may be removed with or without cause by such appointing officer or
committee.

SECTION 4. POWERS AND DUTIES OF THE PRESIDENT. The President, unless a
Chairman is so elected by the Trustees, shall be the principal executive officer
of the Trust. Subject to the control of the Trustees and any committee of the
Trustees, the President shall at all times exercise a general supervision and

<PAGE>

direction over the affairs of the Trust. The President shall have the power to
employ attorneys and counsel for the Trust and to employ such subordinate
officers, agents, clerks and employees as he may find necessary to transact the
business of the Trust. The President shall also have the power to grant, issue,
execute or sign such powers of attorney, proxies or other documents as may be
deemed advisable or necessary in the furtherance of the interests of the Trust.
The President shall have such other powers and duties as, from time to time, may
be conferred upon or assigned to him by the Trustees.

SECTION 5. POWERS AND DUTIES OF VICE PRESIDENTS. In the absence or
disability of the President, the Vice President or, if there are more than one
Vice President, any Vice President designated by the Trustees shall perform all
the duties and may exercise any of the powers of the President, subject to the
control of the Trustees. Each Vice President shall perform such other duties as
may be assigned to him from time to time by the Trustees or the President.

SECTION 6. POWERS AND DUTIES OF THE TREASURER. The Treasurer shall be
the principal financial and accounting officer of the Trust. The Treasurer shall
deliver all funds of the Trust which may come into his hands to such custodian
as the Trustees may employ pursuant to Article X hereof. The Treasurer shall
render a statement of condition of the finances of the Trust to the Trustees as
often as they shall require the same and shall in general perform all the duties
incident to the office of Treasurer and such other duties as from time to time
may be assigned to him by the Trustees. The Treasurer shall give a bond for the
faithful discharge of his duties, if required to do so by the Trustees, in such
sum and with such surety or sureties as the Trustees shall require.

SECTION 7. POWERS AND DUTIES OF THE SECRETARY. The Secretary shall keep
the minutes of all meetings of the Shareholders in proper books provided for
that purpose; shall keep the minutes of all meetings of the Trustees; shall have
custody of the seal of the Trust; and shall have charge of the Share transfer
books, lists and records unless the same are in the charge of the Transfer
Agent. The Secretary shall attend to the giving and serving of all notices by
the Trust in accordance with the provisions of these By-Laws and as required by
law; and subject to these By-Laws, shall in general perform all the duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him by the Trustees.

SECTION 8. POWERS AND DUTIES OF ASSISTANT TREASURERS. In the absence or
disability of the Treasurer, any Assistant Treasurer designated by the Trustees
shall perform all the duties, and may exercise any of the powers, of the
Treasurer. Each Assistant Treasurer shall perform such other duties as from time
to time may be assigned to him by the Trustees. Each Assistant Treasurer shall
give a bond for the faithful discharge of his duties, if required to do so by
the Trustees, in such sum and with such surety or sureties as the Trustees shall
require.

SECTION 9. POWERS AND DUTIES OF ASSISTANT SECRETARIES. In the absence
or disability of the Secretary, any Assistant Secretary designated by the
Trustees shall perform all of the duties, and may exercise any of the powers, of
the Secretary. Each Assistant Secretary shall perform such other duties as from
time to time may be assigned to him by the Trustees.

<PAGE>

SECTION 10. COMPENSATION OF OFFICERS AND TRUSTEES AND MEMBERS OF THE
ADVISORY BOARD. Subject to any applicable law or provision of the Declaration,
the compensation of the officers and Trustees and members of the Advisory Board
shall be fixed from time to time by the Trustees or, in the case of officers, by
any committee of officers upon whom such power may be conferred by the Trustees.
No officer shall be prevented from receiving such compensation as such officer
by reason of the fact that he is also a Trustee.

ARTICLE VII

FISCAL YEAR

The fiscal year of the Trust shall be determined by the Trustees,
provided, however, that the Trustees may from time to time change the fiscal
year.

ARTICLE VIII

SEAL

The Trustees shall adopt a seal which shall be in such form and shall
have such inscription thereon as the Trustees may from time to time prescribe.

ARTICLE IX

WAIVERS OF NOTICE

Whenever any notice is required to be given by law, the Declaration or
these By-Laws, a waiver thereof in writing, signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent thereto. A notice shall be deemed to have been telegraphed,
cabled or wirelessed for the purposes of these By-Laws when it has been
delivered to a representative of any telegraph, cable or wireless company with
instruction that it be telegraphed, cabled or wirelessed. Any notice shall be
deemed to be given at the time when the same shall be mailed, telegraphed,
cabled or wirelessed.

ARTICLE X

CUSTODIAN

SECTION 1. APPOINTMENT AND DUTIES. The Trustees shall at all times
employ a bank or trust company having a capital, surplus and undivided profits
of at least $5,000,000 as custodian with authority as its agent, but subject to
such restrictions, limitations and other requirements, if any, as may be
contained in the Declaration, these By-Laws and the 1940 Act:

(i) to hold the securities owned by the Trust and
deliver the same upon written order;

<PAGE>

(ii) to receive and receipt for any monies due to the Trust
and deposit the same in its own banking department or
elsewhere as the Trustees may direct; (iii) to disburse such
funds upon orders or vouchers; (iv) if authorized by the
Trustees, to keep the books and accounts of the Trust and
furnish clerical and accounting services; and (v) if
authorized by the Trustees, to compute the net income of the
Trust and the net asset value of Shares;

all upon such basis of compensation as may be agreed upon between the Trustees
and the custodian.

The Trustees may also authorize the custodian to employ one or more
sub-custodians from time to time to perform such of the acts and services of the
custodian and upon such terms and conditions as may be agreed upon between the
custodian and such sub-custodian and approved by the Trustees. Subject to the
approval of the Trustees, the custodian may enter into arrangements with
securities depositories. All such custodial, sub-custodial and depository
arrangements shall be subject to, and comply with, the provisions of the 1940
Act and the rules and regulations promulgated thereunder.

SECTION 2. CENTRAL CERTIFICATE SYSTEM. Subject to such rules,
regulations and orders as the Commission may adopt, the Trustees may direct the
custodian to deposit all or any part of the securities owned by the Trust in a
system for the central handling of securities established by a national
securities exchange or a national securities association registered with the
Commission under the Securities Exchange Act of 1934, or with such other person
as may be permitted by the Commission, or otherwise in accordance with the 1940
Act, pursuant to which system all securities of any particular class or series
of any issuer deposited within the system are treated as fungible and may be
transferred or pledged by bookkeeping entry without physical delivery of such
securities, provided that all such deposits shall be subject to withdrawal only
upon the order of the Trust or its custodian.

SECTION 3. ACCEPTANCE OF RECEIPTS IN LIEU OF CERTIFICATES. Subject to
such rules, regulations and orders as the Commission may adopt, the Trustees may
direct the custodian to accept written receipts or other written evidences
indicating purchases of securities held in book-entry form in the Federal
Reserve System in accordance with regulations promulgated by the Board of
Governors of the Federal Reserve System and the local Federal Reserve Banks in
lieu of receipt of certificates representing such securities.

SECTION 4. PROVISIONS OF CUSTODIAN CONTRACT. The following provisions
shall apply to the employment of a custodian pursuant to this Article X and to
any contract entered into with the custodian so employed:

(a) The Trustees shall cause to be delivered to the custodian all
securities owned by the Trust or to which it may become entitled, and
shall order the same to be delivered by the custodian only upon
completion of a sale, exchange, transfer, pledge, or other disposition
thereof, and upon receipt

<PAGE>

by the custodian of the consideration therefor or a certificate of
deposit or a receipt of an issuer or of its Transfer Agent, all as the
Trustees may generally or from time to time require or approve, or to
a successor custodian; and the Trustees shall cause all funds owned by
the Trust or to which it may become entitled to be paid to the
custodian, and shall order the same disbursed only for investment
against delivery of the securities acquired, or in payment of
expenses, including management compensation, and liabilities of the
Trust, including distributions to Shareholders, or to a successor
custodian; provided, however, that nothing herein shall prevent
delivery of securities for examination to the broker purchasing the
same in accord with the "street delivery" custom whereby such
securities are delivered to such broker in exchange for a delivery
receipt exchanged on the same day for an uncertified check of such
broker to be presented on the same day for certification.

(b) In case of the resignation, removal or inability to serve of any such
custodian, the Trust shall promptly appoint another bank or trust
company meeting the requirements of this Article X as successor
custodian. The agreement with the custodian shall provide that the
retiring custodian shall, upon receipt of notice of such appointment,
deliver all Trust Property in its possession to and only to such
successor, and that pending appointment of a successor custodian, or a
vote of the Shareholders to function without a custodian, the
custodian shall not deliver any Trust Property to the Trust, but may
deliver all or any part of the Trust Property to a bank or trust
company doing business in Boston, Massachusetts, of its own selection,
having an aggregate capital, surplus and undivided profits (as shown
in its last published report) of at least $5,000,000; provided that
arrangements are made for the Trust Property to be held under terms
similar to those on which they were held by the retiring custodian.

ARTICLE XI

AMENDMENTS

These By-Laws, or any of them, may be altered, amended or repealed, or
new By-Laws may be adopted (a) by the Shareholders by a Majority Shareholder
Vote, or (b) by the Trustees, provided, however, that no By-Law may be amended,
adopted or repealed by the Trustees if such amendment, adoption or repeal
requires, pursuant to law, the Declaration or these By-Laws, a vote of the
Shareholders.

JPM322

Consents of Independent Accountants

We hereby consent to the use in the Statement of Additional Information
constituting part of this Post-Effective Amendment No. 1 to the registration
statement on Form N-1A (the "Registration Statement") of our reports dated March
24, 1995, relating to the statements of assets and liabilities of The JPM
Advisor U.S. Fixed Income Fund, The JPM Advisor International Fixed Income Fund,
The JPM Advisor International Equity Fund, The JPM Advisor Emerging Markets
Equity Fund, The JPM Advisor Asia Growth Fund, The JPM Advisor European Equity
Fund, The JPM Advisor Japan Equity Fund, The Asia Growth Portfolio, The European
Equity Portfolio and The Japan Equity Portfolio at March 24, 1995, and our
report dated November 1, 1994, relating to the statement of assets and
liabilities of The Non-U.S. Fixed Income Portfolio at October 6, 1994, which
appear in such Statement of Additional Information, and to the incorporation by
reference of our reports into the Prospectus which constitute part of this
Registration Statement.

We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of the Registration
Statement of our reports dated September 26, 1995, relating to the financial
statements and financial highlights of The JPM Advisor U.S. Equity Fund and The
JPM Advisor U.S. Small Cap Equity Fund and our reports dated July 26, 1995,
relating to the financial statements and supplementary data of The Selected U.S.
Equity Portfolio and The U.S. Small Company Portfolio appearing in the May 31,
1995 Annual Reports, which are also incorporated by reference into the
Registration Statement.

We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of the Registration
Statement of our reports dated December 27, 1994, relating to the financial
statements and supplementary data of The U.S. Fixed Income Portfolio and The
Non-U.S. Equity Portfolio appearing in the October 31, 1994 Annual Reports,
which are also incorporated by reference into the Registration Statement.

We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of the Registration
Statement of our report dated December 30, 1994, relating to the financial
statements and supplementary data of The Emerging Markets Equity Portfolio
appearing in the October 31, 1994 Annual Report, which is also incorporated by
reference into the Registration Statement.

We also consent to the references to us under the headings "Independent
Accountants" and "Financial Statements" in the Statement of Additional
Information.

/s/ PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
September 26, 1995

<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL DATA EXTRACTED FROM THE SEMIANNUAL
REPORT DATED MAY 31,1995 FOR THE JPM ADVISOR US EQUITY FUND AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH SEMIANNUAL REPORT.
</LEGEND>
<CIK>0000931068
<NAME> THE JPM ADVISOR FUNDs
<SERIES>
<NUMBER>01
<NAME>THE JPM ADVISOR US EQUITY FUND

<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1995
<PERIOD-START> MAR-24-1995
<PERIOD-END> MAY-31-1995
<INVESTMENTS-AT-COST> 100
<INVESTMENTS-AT-VALUE> 108
<RECEIVABLES> 8,895
<ASSETS-OTHER> 65,696
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 74,699
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 74,591
<TOTAL-LIABILITIES> 74,591
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 100
<SHARES-COMMON-STOCK> 10
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 2
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 5
<NET-ASSETS> 108
<DIVIDEND-INCOME> 1
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 1
<REALIZED-GAINS-CURRENT> 2
<APPREC-INCREASE-CURRENT> 5
<NET-CHANGE-FROM-OPS> 8
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 108
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 8,895
<AVERAGE-NET-ASSETS> 100
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .10
<PER-SHARE-GAIN-APPREC> .68
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.78
<EXPENSE-RATIO> 0.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL DATA EXTRACTED FROM THE JPM ADVISOR US
SMALL CAP EQUITY FUND ANNUAL REPORT DATED MAY 31, 1995 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH ANNUAL REPORT.
</LEGEND>
<CIK>0000931068
<NAME> THE JPM ADVISOR FUNDS
<SERIES>
<NUMBER>02
<NAME> THE JPM ADVISOR US SMALL CAP FUND

<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1995
<PERIOD-START> MAR-24-1995
<PERIOD-END> MAY-31-1995
<INVESTMENTS-AT-COST> 100
<INVESTMENTS-AT-VALUE> 106
<RECEIVABLES> 8,830
<ASSETS-OTHER> 64,045
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 72,981
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 72,875
<TOTAL-LIABILITIES> 72,875
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 100
<SHARES-COMMON-STOCK> 10
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 2
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3
<NET-ASSETS> 0
<DIVIDEND-INCOME> 1
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 1
<REALIZED-GAINS-CURRENT> 2
<APPREC-INCREASE-CURRENT> 3
<NET-CHANGE-FROM-OPS> 6
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 106
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 8,830
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .10
<PER-SHARE-GAIN-APPREC> .54
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.64
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>