FUNDMANAGER PORTFOLIOS, 485APOS, 1997-09-30

FUNDMANAGER PORTFOLIOS
485APOS, 1997-09-30

Previous: ACT MANUFACTURING INC, S-8, 1997-09-30

Next: JTS CORP, 10-Q/A, 1997-09-30

1933 Act File No. 33-89754
1940 Act File No. 811-8992

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
----

Pre-Effective Amendment No. .............................

Post-Effective Amendment No. 6 ................................ X
---- ----

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
----

Amendment No. 7 .............................................. X
------ ----

FUNDMANAGER PORTFOLIOS
(formerly, FUNDMANAGER TRUST)
(Exact Name of Registrant as Specified in Charter)

Federated Investors Tower Pennsylvania 15222-3779
(Address of Principal Executive Offices)

(412) 288-1900
(Registrant's Telephone Number)

Victor R. Siclari, Esquire
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)

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

__ immediately upon filing pursuant to paragraph (b)
on ____________ pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a) (i)
X on November 30, 1997 pursuant to paragraph (a) (i)
75 days after filing pursuant to paragraph (a)(ii) on _________________
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.

<PAGE>

Registrant has filed with the Securities and Exchange Commission a declaration
pursuant to Rule 24f-2 under the Investment Company Act of 1940, and:

X _ filed the Notice required by that Rule on November 26, 1996; or intends to
file the Notice required by that Rule on or about ____________; or
during the most recent fiscal year did not sell any securities pursuant to
Rule 24f-2 under the Investment Company Act of 1940, and, pursuant to Rule
24f-2(b)(2), need not file the Notice.

Copies to:

John J. Danello Edward T. O'Dell, P.C
Freedom Capital Management Corporation Goodwin, Procter & Hoar
One Beacon Street One Exchange Place
Boston, Massachusetts 02108 Boston, Massachusetts 02109

<PAGE>

CROSS-REFERENCE SHEET

This Amendment to the Registration Statement of FUNDMANAGER PORTFOLIOS
(formerly, FundManager Trust)),which is comprised of six Portfolios: (1)
Aggressive Growth Portfolio, consisting of two classes of shares (a) Financial
Adviser Class and (b) No-Load Class; (2) Growth Portfolio, consisting of two
classes of shares (a) Financial Adviser Class and (b) No-Load Class; (3) Growth
with Income Portfolio, consisting of two classes of shares (a) Financial Adviser
Class and (b) No-Load Class; (4) Bond Portfolio, consisting of two classes of
shares (a) Financial Adviser Class and (b) No-Load Class; (5) Managed Total
Return Portfolio, consisting of one class of shares (a) Financial Adviser Class,
and (6) International Portfolio, consisting of two classes of shares (a)
Financial Adviser Class and (b) No-Load Class relates to all portfolios except
International Portfolio and is comprised of the following (The remaining
references to other portfolios have been kept for easier cross reference.):

PART A. INFORMATION REQUIRED IN A PROSPECTUS.

Prospectus Heading
(Rule 404(c) Cross Reference)

Item 1. Cover Page..................................(1-6) Cover Page.
Item 2. Synopsis....................................(1-6) Summary of Fund Expenses.
Item 3. Condensed Financial
Information................................(1-5) Financial Highlights; (1-6) Performance Information.
Item 4. General Description of
Registrant.................................(1-6) FundManager
Portfolios; (1-5)
Investment
Objectives; (6)
Investment
Objective; (1-6)
Investments of and
Investment
Techniques
Employed By Mutual
Funds in which the
Portfolio May
Invest; (1-6)
Investment
Policies and
Restrictions;
(1-5) Risks and
Other
Considerations;
(6) Additional
Risks and Other
Considerations;
(1-6)
Capitalization.
Item 5. Management of the Fund (1-6) Management of FundManager Portfolios;
(1-6) The Adviser; (1-6) The Administrator; (1-6)
The Distributors;(1-5) Custodian and Transfer Agent; (6)
Custodian;
(6) Transfer Agent, Dividend Disbursing Agent,
and Shareholder Servicing Agent; (1a-5a,6)
Service Organizations; (1-6) Other Expenses; (1-6)
Portfolio Transactions.
Item 6. Capital Stock and Other
Securities.................................(1-6) Dividends, Distributions and Taxes;
(1-6) Voting; (1-6) Shareholder Inquiries.
Item 7. Purchase of Securities Being
Offered....................................(1-6) The Distributors;(1-6) Determination of
Net Asset Value;(1-6) Purchase of Shares; (1a-5a,
6) Retirement Plans; (1a-5a,6) Individual Retirement Accounts;
(1a-5a,6) Defined Contribution Plan;
(1a-5a,6) Exchange Privilege; (1b-4b,6)
FundManager Advisory Program.
Item 8. Redemption or Repurchase....................(1-6) Redemption of Shares; (1a-5a,6) Redemption
of Shares Purchased Through a Distributor or Authorized
Securities Dealer; (1b-5b) Redemption of Shares
Purchased
Through a Distributor; (1-5) Direct Redemption; (6)
Financial Adviser Class; (1a-5a,6) Redemption By Wire
or Telephone; (1a-5a,6) Systematic Withdrawal Plan; (6)
Limits on Redemptions.

Item 9. Legal Proceedings None.

</TABLE>

<PAGE>

PART B. INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION.

Item 10. Cover Page..................................(1-6) Cover Page.
Item 11. Table of Contents...........................(1-6) Table of Contents.
Item 12. General Information and
History (1-6) Other Information.
Item 13. Investment Objectives and
Policies...................................(1-6) Investment Policies; (1-6) Investment Restrictions.
Item 14. Management of the Fund (1-6) Management; (1-6) Trustees Compensation.
Item 15. Control Persons and Principal
Holders of Securities......................(1-6) Management; (1-6) Other Information.
Item 16. Investment Advisory and Other
Services...................................(1-6) Management; (1-6) Investment Adviser
Item 17. Brokerage Allocation........................(1-6) Portfolio Transactions.
Item 18. Capital Stock and Other
Securities (1-6) Other Information.
Item 19. Purchase, Redemption and
Pricing of Securities Being
Offered....................................(1-6) See Part A
Prospectus - Purchase of Shares; (1-6) See Part A Prospectus - Redemption of
Shares; (1-6) See Part A Prospectus - Determination of Net Asset Value.

Item 20. Tax Status..................................(1-5) See Part A Prospectus - Dividends,
Distributions and Taxes; (6) The Portfolio's Tax Status.
Item 21. Underwriters (1-6) Management; (1-6) Administrator; (1-6) Distributors;
(6) Service Organizations.
Item 22. Calculation of Performance
Data.......................................(1-6) Other Information; (1-6) Performance Information.
Item 23. Financial Statements........................To be filed by amendment.
</TABLE>

FundManager Portfolios--Financial Adviser Class
(formerly, FundManager Trust)
One Beacon Street, Boston, Massachusetts 02108
General Information: (800) 344-9033 (Toll Free)

FundManager Portfolios (the "Trust") is an open-end, management investment
company consisting of five separate diversified series with different investment
objectives (individually and collectively referred to as "Portfolio" or
"Portfolios," as the context requires). Each Portfolio (except for Managed Total
Return Portfolio) offers two classes of shares. The shares offered by this
Prospectus are the Financial Adviser Class (the "Class") of shares ("Shares").
The Portfolios seek to achieve their objectives by investing in shares of other
open-end investment companies commonly called mutual funds. This policy involves
certain expenses in addition to those applicable to direct investment in mutual
funds. See "Risks and Other Considerations--Expenses." The M.D. Hirsch Division
of Freedom Capital Management Corporation ("Freedom Capital Management" or the
"Adviser") continuously manages each Portfolio's investment portfolio.

Aggressive Growth Portfolio seeks capital appreciation without regard to current
income.

Growth Portfolio primarily seeks long-term capital appreciation. Current income
is a secondary consideration.

Growth with Income Portfolio seeks a combination of capital appreciation and
current income.

Bond Portfolio seeks a high level of current income.

Managed Total Return Portfolio seeks high total return (capital appreciation and
current income).

Shares of the Portfolios are offered for sale at net asset value by Edgewood
Services, Inc. ("Edgewood"), Freedom Distributors Corporation ("Freedom
Distributors"), Tucker Anthony Incorporated ("Tucker Anthony") and Sutro & Co.
Incorporated ("Sutro")(collectively, the "Distributors") as an investment
vehicle for individuals, institutions, corporations and fiduciaries. The
Portfolios pay expenses related to the distribution of their shares. See
"Management of the Trust--The Distributors." In addition, the Portfolios may
invest in shares of mutual funds which charge sales loads and/or pay their own
distribution expenses.

Investments in the Portfolios are neither insured nor guaranteed by the U.S.
government. Shares of the Portfolios are not deposits or obligations of, or
guaranteed or endorsed by, any bank, and the shares are not federally insured by
the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any
other government agency. An investment in the Portfolios is subject to
investment risks, including possible loss of the principal amount invested.

This prospectus sets forth concisely the information a prospective investor
should know before investing in the Portfolios. A Statement of Additional
Information (the "SAI") dated _______, and as supplemented from time to time
containing additional and more detailed information about the Portfolios has
been filed with the Securities and Exchange Commission ("SEC") and is hereby
incorporated by reference into this prospectus. You may request a copy of the
SAI, or a paper copy of this prospectus, if you have received your prospectus
electronically, free of charge by writing or calling the Trust at the address
and information number printed above. The SAI, material incorporated by
reference into this document, and other information regarding the Portfolios is
maintained electronically with the SEC at internet web site
(http://www.sec.gov).

This
Prospectus should be read and retained for information about the Portfolios.

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

THE DATE OF THIS PROSPECTUS IS _______.

<PAGE>

TABLE OF CONTENTS [TO BE UPDATED]

Highlights 1
Portfolio Expenses 3
Financial Highlights 4
FundManager Portfolios 10
Investment Objectives 10
Investments of and Investment
Techniques Employed by Mutual
Funds in which the Portfolios
May Invest 14
Derivatives 17
Investment Policies and Restrictions 20
Risks and Other Considerations 21
Expenses 22
Management of FundManager Portfolios 23
The Adviser 23
The Administrator 23
The Distributors 24
Custodian and Transfer Agent 24
Service Organizations 25
Other Expenses 25
Portfolio Transactions 25
Determination of Net Asset Value 26
Purchases of Shares 26
Purchases By Clients of the
Distributors Or Authorized
Securities Dealers 27
Certain Service Organizations and
Other Investors--Purchase by
Check or Wire 27
Automatic Investment Plan 27
Retirement Plans 28
Individual Retirement Accounts ("IRAs") 28
Defined Contribution Plan 28
Exchange Privilege 28
Redemption of Shares 29
Redemption of Shares Purchased
Through a Distributor or
Authorized Securities Dealer 29
Direct Redemption 29
Redemption by Wire or Telephone 29
Systematic Withdrawal Plan 30
Dividends, Distribution and Taxes 30
Other Information 32
Other Classes of Shares 34
Shareholder Inquiries 34
Description of Bond Ratings 34

<PAGE>

HIGHLIGHTS

FUNDMANAGER PORTFOLIOS Page 10
The Trust is a Delaware business trust which consists of five separate series:
Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio,
Bond Portfolio and Managed Total Return Portfolio. Each Portfolio seeks to
achieve its investment objective by investing in mutual funds registered with
the SEC.

INVESTMENT OBJECTIVES
Page 10
Each Portfolio has distinct investment objectives. Aggressive Growth Portfolio
seeks capital appreciation without regard to current income. Growth Portfolio
primarily seeks capital appreciation with current income a secondary
consideration. Growth with Income Portfolio seeks a combination of capital
appreciation and current income. Bond Portfolio seeks a high level of current
income. Managed Total Return Portfolio seeks high total return (capital
appreciation and current income). The mutual funds in which the Portfolios
invest may invest in securities which entail certain risks. These risks are
described in "Investments of and Investment Techniques Employed by Mutual Funds
in Which the Portfolios May Invest."

RISKS AND OTHER CONSIDERATIONS Page 21
Investing in a Portfolio that consists of an underlying portfolio of mutual
funds involves certain additional expenses and certain tax results which would
not be present in a direct investment in mutual funds. See "Expenses" and
"Dividends, Distributions and Taxes." In addition, Federal law imposes certain
limits on the purchases of mutual fund shares by the Portfolios.

MANAGEMENT OF FUNDMANAGER PORTFOLIOS Page 23
The Trust has retained Freedom Capital Management to act as its investment
adviser. For its services, the Adviser receives from each Portfolio a fee at the
annual rate of 0.50% of the Portfolio's average daily net assets up to $500
million and 0.40% of its average daily net assets in excess of $500 million. See
"The Adviser."

The Trust has retained Federated Administrative Services ("FAS") to provide
certain management and administrative services to the Portfolios. For these
services, each Portfolio pays FAS a fee at the annual rate of 0.150% of the
first $250 million of that Portfolio's average daily net assets, 0.125% of the
next $250 million of such assets, 0.100% of the next $250 million of such
assets, and 0.075% of such assets in excess of $750 million. See "The
Administrator."

With respect to the Class, the Trust has adopted a Distribution Plan pursuant to
Rule 12b-1 under the Investment Company Act of 1940 (the "1940 Act"), under
which each Portfolio will reimburse the Distributors (in amounts up to 0.50% of
that Portfolio's average daily net assets attributable to the Class) for
marketing costs and payments to other organizations for services rendered in
distributing the Portfolio's Shares. In addition, Freedom Distributors and
Edgewood may receive additional compensation in connection with the Portfolio's
purchases of mutual funds. See "Portfolio Transactions."

The Trust also contracts with various organizations to provide administrative
services for the Class, such as maintaining shareholder accounts and records.
Each Portfolio pays fees to these organizations in amounts up to an annual rate
of 0.25% of the daily net asset value of that Portfolio's Shares owned by
shareholders with whom the organization has a servicing relationship.

PURCHASE OF SHARES Page 26
Shares of the Portfolios are offered at net asset value by the Distributors as
an investment vehicle for individuals, institutions, corporations and
fiduciaries. The minimum initial investment for each Portfolio is $1,000, and
the minimum subsequent investment is $100, except that the minimum initial
investment for an Individual Retirement Account ("IRA") is $250. The Trust may
issue shares of one or more of the Portfolios in exchange for mutual fund shares
meeting that Portfolio's investment objective as determined by the Adviser.

REDEMPTION OF SHARES Page 29
Shares may be redeemed at their next determined net asset value. See
"Determination of Net Asset Value." Redemptions may be made by letter or wire.
The Trust reserves the right to redeem, upon not less than 30 days' notice, all
shares of a Portfolio in an account (other than an IRA) which has a value below
$500.

DIVIDENDS, DISTRIBUTIONS AND TAXES Page 30
Aggressive Growth Portfolio will distribute net investment income annually;
Growth Portfolio will distribute net investment income semiannually; Growth with
Income Portfolio and Managed Total Return Portfolio will distribute net
investment income quarterly; and Bond Portfolio will distribute its net
investment income monthly. Each Portfolio will distribute any net realized
capital gains at least annually unless otherwise instructed. All dividends and
distributions will be reinvested automatically at net asset value in additional
shares of the Portfolio making the distribution.

<PAGE>

PORTFOLIO EXPENSES

[TO BE FILED BY AMENDMENT]

<PAGE>

FINANCIAL HIGHLIGHTS

The Portfolios' financial data through September 30, 1997, shown below is to
assist investors in evaluating the performance of each Portfolio. Prior to May
8, 1995, the Portfolios were a diversified series of the Republic Funds (the
"Predecessor Funds"), also an open-end, management investment company. The
information for the years ended September 30, 1997, 1996, 1995, 1994, and 1993
in the following tables have been audited by Ernst & Young LLP, the Portfolios'
Independent Auditors. The report of Ernst & Young LLP, dated November __, 1997,
on the Portfolios' financial statements for the year then ended September 30,
1997, and on the following tables for the periods presented, is included in the
Annual Report, which is incorporated by reference. These tables should be read
in conjunction with the Portfolios' financial statements and notes thereto,
which are contained in the Annual Report. Further information about the
Portfolios' performance also is contained in the Portfolios' Annual Report,
dated September 30, 1997, which can be obtained free of charge. The information
in the following tables for the fiscal year ended September 30, 1991 and for
prior fiscal year ends has been examined by other auditors who have expressed an
unqualified opinion.

Freedom Capital Management is the Trust's investment adviser. From September 1,
1993 to February 21, 1995, the M.D. Hirsch Division of Republic Asset Management
Corporation ("Republic Asset Management"), an affiliate of Republic National
Bank of New York ("Republic"), served as investment adviser to the Predecessor
Funds. Prior to September 1, 1993, M.D. Hirsch Investment Management, Inc.
("Hirsch"), also an affiliate of Republic, served as the investment adviser to
the Predecessor Funds. Prior to February 1, 1991, Republic was the investment
adviser to the Predecessor Funds.

<PAGE>

FUNDMANAGER PORTFOLIOS

The Trust was organized as a Delaware business trust on February 7, 1995, and is
an open-end management investment company registered under the 1940 Act
consisting of five separate diversified series--Aggressive Growth Portfolio,
Growth Portfolio, Growth with Income Portfolio, Bond Portfolio and Managed Total
Return Portfolio. Investment in shares of one or more of the Portfolios involves
risks and there can be no assurance that the Portfolios' investment objectives
will be achieved.

INVESTMENT OBJECTIVES

Each Portfolio seeks to achieve its investment objective by investing in a
portfolio of other open-end registered investment companies (the "underlying
funds"). At times, for temporary defensive purposes when warranted by general
economic and financial conditions, a Portfolio may invest in money market mutual
funds or invest directly in (or enter into repurchase agreements (maturing in
seven days or less) with banks and broker-dealers with respect to) short-term
debt securities, including U.S. Treasury bills and other short-term U.S.
government securities, commercial paper, certificates of deposit and bankers'
acceptances. However, except when a Portfolio is in a temporary defensive
investment position or as may be considered necessary to accumulate cash in
order to satisfy minimum purchase requirements of the underlying funds or to
meet anticipated redemptions, a Portfolio normally will maintain its assets
invested in underlying funds. Although all of the Portfolios may invest in
shares of the same underlying fund, the percentage of each Portfolio's assets so
invested may vary and the Adviser will determine that such investments are
consistent with the investment objectives and policies of each particular
Portfolio. A Portfolio may not purchase shares of any closed-end investment
company or of any investment company which is not registered with the SEC. Each
Portfolio's investment objectives and certain of its related policies and
activities are fundamental and may not be changed by the Board of Trustees (the
"Trustees") of the Trust, on behalf of a particular Portfolio, without approval
of the shareholders of that Portfolio.

AGGRESSIVE GROWTH PORTFOLIO
The investment objective of Aggressive Growth Portfolio is capital appreciation
without regard to current income. The underlying funds in which it invests will
consist of funds which seek capital growth or appreciation by investing
primarily in common stock or securities convertible into or exchangeable for
common stock (such as convertible preferred stock, convertible debentures or
warrants). For temporary defensive purposes, these funds also may invest in (or
enter into repurchase agreements with banks and broker-dealers with respect to)
corporate bonds, U.S. government securities, commercial paper, certificates of
deposit or other money market securities.

The Portfolio also may invest in funds which invest primarily in long- or
short-term bonds and other fixed income securities (such as securities issued or
guaranteed or insured by the U.S. government, its agencies or instrumentalities,
commercial paper, preferred stock, convertible preferred stock or convertible
debentures) whenever the Adviser believes that these funds offer a potential for
capital appreciation. These underlying funds may invest in investment grade
bonds or in bonds which are not considered investment grade (commonly referred
to as "junk bonds"). The Portfolio will limit its direct and indirect investment
in junk bonds to less than 5% of its assets. See "Bond Portfolio" and
"Description of Bond Ratings."

The underlying funds in which Aggressive Growth Portfolio invests may incur more
risk than those in which Growth Portfolio and Growth with Income Portfolio
invest. For example, they may trade their portfolios more actively (which
results in higher brokerage commissions and increased realization of taxable
capital gains) and/or invest in companies whose securities are subject to more
erratic market movements. The underlying funds also may invest up to 100% of
their assets in securities of foreign issuers and engage in foreign currency
transactions with respect to these investments; invest up to 15% of their assets
in illiquid securities (excluding Rule 144A securities which are deemed liquid
by the Trustees) ("Illiquid Securities"); invest their assets in warrants; lend
their portfolio securities; sell securities short; borrow money in amounts up to
one-third of their assets for investment purposes (i.e., leverage their
portfolios); write (sell) or purchase call or put options on securities or on
stock indexes; concentrate more than 25% of their assets in one industry; invest
up to 100% of their assets in master demand notes; and enter into futures
contracts and options on futures contracts. The risks associated with these
investments are described in the "Investments of and Investment Techniques
Employed by Mutual Funds in Which the Portfolios May Invest."

As a result, an investment in Aggressive Growth Portfolio can be expected to
involve greater risk than an investment in any of the other Portfolios.

GROWTH PORTFOLIO

The primary investment objective of Growth Portfolio is long-term capital
appreciation. Current income is of secondary importance. The underlying funds in
which it invests will consist of funds which invest primarily in common stock or
securities convertible into or exchangeable for common stock (such as
convertible preferred stock, convertible debentures or warrants) and which seek
long-term capital growth or appreciation with current income typically of
secondary importance. For temporary defensive purposes, these underlying funds
also may invest in (or enter into repurchase agreements with banks and
broker-dealers with respect to) corporate bonds, U.S. government securities,
commercial paper, certificates of deposit or other money market instruments.

The underlying funds in which the Portfolio invests may be authorized to invest
up to 100% of their assets in the securities of foreign issuers and engage in
foreign currency transactions with respect to these investments; invest up to
15% of their assets in Illiquid Securities; invest their assets in warrants;
lend their portfolio securities; sell securities short; borrow money in amounts
up to one-third of their assets for investment purposes; write or purchase call
or put options on securities or stock indexes; concentrate more than 25% of
their assets in one industry; invest up to 100% of their assets in master demand
notes; and enter into futures contracts and options on futures contracts. The
risks associated with these investments are described in "Investments of and
Investment Techniques Employed by Mutual Funds in Which the Portfolios May
Invest."

GROWTH WITH INCOME PORTFOLIO
The investment objective of Growth with Income Portfolio is realization of a
combination of capital appreciation and current income. The underlying funds in
which it invests will consist of funds which seek long-term capital appreciation
and/or funds which seek: (i) income from dividends; (ii) income from interest;
or (iii) growth of income (or any combination of (i)-(iii)). These underlying
funds invest in common stocks, preferred stocks, bonds and other fixed-income
securities (including convertible preferred stock and convertible debentures).
The underlying funds also may, for temporary defensive purposes, invest in (or
enter into repurchase agreements with banks and broker-dealers with respect to)
U.S. government securities, commercial paper, certificates of deposit or other
money market securities.

These underlying funds may invest up to 100% of their assets in the securities
of foreign issuers and engage in foreign currency transactions with respect to
these investments; invest up to 15% of their assets in Illiquid Securities;
invest their assets in warrants; lend their portfolio securities; sell
securities short; borrow money in amounts up to one-third of their assets for
investment purposes; write or purchase call or put options on securities or on
stock indexes; concentrate more than 25% of their assets in any one industry;
invest up to 100% of their assets in master demand notes; invest in long- or
short-term corporate bonds (see "Bond Portfolio") and other fixed income
securities (such as U.S. government securities, commercial paper, preferred
stock, convertible preferred stock and convertible debentures); and enter into
futures contracts and options on futures contracts. The risks associated with
these investments are described below.

BOND PORTFOLIO
The investment objective of Bond Portfolio is a high level of current income.
The underlying funds in which it invests will include funds which seek high
current income by investing in long- or short-term bonds and other fixed income
securities (such as securities issued or guaranteed or insured by the U.S.
government, its agencies or instrumentalities, commercial paper, preferred
stock, convertible preferred stock or convertible debentures). The underlying
funds also may lend their portfolio securities; sell securities short; borrow
money in amounts up to one-third of their assets for investment purposes; write
or purchase call or put options on securities or on stock indexes; invest up to
100% of their assets in master demand notes; and enter into futures contracts
and options on futures contracts.

The Portfolio will invest in underlying funds which limit their corporate bond
investments to investment grade bonds which generally are considered to be bonds
rated within one of the four highest quality grades assigned by a nationally
recognized statistical rating organization ("NRSRO"), such as Standard & Poor's
Ratings Group ("S&P") or Moody's Investor Services, Inc. ("Moody's"), or which
are unrated but are deemed by an underlying fund's investment adviser to be of
comparable quality. These include bonds rated AAA, AA, A and BBB by S&P and
bonds rated Aaa, Aa, A and Baa by Moody's. Bonds rated BBB by S&P or Baa by
Moody's normally indicate a greater degree of investment risk than bonds with
higher ratings.

The Portfolio also will invest (without limitation) in underlying funds which
themselves may invest in corporate bonds which are not considered investment
grade bonds (commonly referred to as "junk bonds") by an NRSRO, such as Moody's
or S&P, or which are unrated, and thus may carry a greater degree of risk than
bonds considered investment grade. These include bonds rated BB, B, CCC and CC
by S&P, and Ba, B, Caa, Ca and C by Moody's. These ratings may indicate that the
bonds are predominantly speculative with respect to the issuer's ability to pay
interest and repay principal and may indicate that the issuer soon may be or
currently is in default. The risks associated with these investments are
described in "Description of Bond Ratings." The Portfolio will limit its direct
and indirect investment in junk bonds to less than 35% of its net assets.

As a general matter, the current value of bonds varies inversely with changes in
prevailing interest rates. If interest rates increase after a bond is purchased,
the value of that security will normally decline. Conversely, should prevailing
interest rates decrease after a bond is purchased, its market price will
normally rise.

MANAGED TOTAL RETURN PORTFOLIO
The investment objective of Managed Total Return Portfolio is to realize high
total return (capital appreciation and current income). The Portfolio seeks to
achieve its objective by investing in a broad range of underlying funds. It will
allocate its assets among one or more of five general types of mutual funds:
aggressive growth funds, growth funds, growth and income funds, fixed income
(bond) funds and money market funds. The Portfolio is unlikely at any particular
moment to have all its assets invested in only one of these general types of
funds. The Adviser will vary the proportion of each type of underlying fund
based on the mix of such funds that may, in the Adviser's view, be most likely
to achieve the Portfolio's investment objective.

In allocating assets among the five general types of underlying funds, the
Adviser will follow a multi-step investment analysis. First, the Adviser will
consider general political and economic trends and current financial and market
conditions in order to determine the current phase of the business and
investment cycle and to assess the risks and opportunities in the financial
markets. The Adviser will seek the most likely combination of fund types which
will provide the best opportunity for maximizing total return consistent with
prudent investment risk. The Adviser will not rely on a model in reaching asset
allocation decisions, but will make its own assessment of the relative
risk-reward levels of various asset types based on its past experience and
analysis of current conditions.

If the Adviser determines that the values of equity securities are likely to
rise, it may emphasize aggressive and conservative growth funds. In periods of
rising interest rates, it may emphasize holdings of money market funds or in
periods of falling interest rates it may emphasize fixed income funds, depending
upon conditions in the equity markets.

Second, after determining the relative proportion of assets to be allocated to
particular types of funds, the Adviser will identify whether certain specific
categories of funds offer greater potential for positive returns. For example,
the Adviser may choose to emphasize international equity funds or funds that
concentrate in a particular industry sector; or the Adviser may select fixed
income funds based on whether they invest primarily in long- or short-term debt
securities.

Finally, the Adviser will select those funds within the general or more specific
categories, as discussed, that offer the greatest potential for positive returns
in the Adviser's judgment.

Within the framework of the foregoing guidelines, the underlying funds in which
the Portfolio will invest will consist of funds which seek capital growth and
appreciation by investing primarily in common stock or securities convertible
into or exchangeable for common stock (such as convertible preferred stock,
convertible debentures or warrants); funds which seek a combination of capital
appreciation and current income (including income from dividends, income from
interest, growth of income or any combination thereof) by investing primarily in
common stocks, preferred stocks, bonds and other fixed income securities
(including convertible preferred stock and convertible debentures); funds which
seek high current income by investing primarily in long- or short-term bonds and
other fixed income securities (such as securities issued, guaranteed or insured
by the U.S. government, its agencies or instrumentalities, commercial paper,
preferred stock, convertible preferred stock or convertible debentures); and
funds which seek as high a level of current income as is consistent with
preservation of capital and liquidity by investing in a broad range of high
quality, short-term money market instruments which have remaining maturities not
exceeding one year (including U.S.
government securities, bank obligations, commercial paper, corporate debt
securities and repurchase agreements).

Some of the underlying funds in which the Portfolio invests may incur more risk
than others. For example, they may trade their portfolios more actively (which
results in higher brokerage commissions and increased realization of taxable
capital gains) and/or invest in companies whose securities are subject to more
erratic market movements. The underlying funds also may invest up to 100% of
their assets in securities of foreign issuers and engage in foreign currency
transactions with respect to these investments; invest up to 15% of their assets
in Illiquid Securities; invest their assets in warrants; lend their portfolio
securities; sell securities short; borrow money in amounts of up to one-third of
their assets for investment purposes (i.e., leverage their portfolios); write
(sell) or purchase call or put options on securities or on stock indexes;
concentrate more than 25% of their assets in one industry; invest up to 100% of
their assets in master demand notes; and enter into futures contracts and
options on futures contracts. The risks associated with these investments are
described below.

The Portfolio may invest in underlying funds which limit their corporate bond
investments to investment grade bonds which generally are considered to be bonds
rated within one of the four highest quality grades assigned by an NRSRO, such
as S&P or Moody's, or underlying funds which invest in corporate bond
investments which are unrated but are deemed by an underlying fund's investment
adviser to be of comparable quality. It may also invest in underlying funds
which invest in corporate bonds which are not considered investment grade bonds
(commonly referred to as "junk bonds") by an NRSRO, such as Moody's or S&P, or
which are unrated, and thus may carry a greater degree of risk than bonds
considered investment grade. These ratings may indicate that the bonds are
predominantly speculative with respect to the issuer's ability to pay interest
and repay principal and may indicate that the issuer soon may be or currently is
in default. The risks associated with these investments are described below. The
Portfolio will limit its direct and indirect investment in junk bonds to less
than 35% of its assets.

At times, for temporary defensive purposes when warranted by general economic
and financial conditions, the Portfolio may invest in a variety of short-term
debt securities, including U.S. Treasury bills and other U.S. government
securities, commercial paper, certificates of deposit, bankers' acceptances and
repurchase agreements with respect to such securities. However, except when the
Portfolio is in a temporary defensive investment position or as may be
considered necessary to accumulate cash in order to satisfy minimum purchase
requirements of the underlying funds or to meet anticipated redemptions, it
normally will maintain its assets invested in underlying funds.

INVESTMENTS OF AND INVESTMENT TECHNIQUES EMPLOYED BY MUTUAL FUNDS
IN WHICH THE PORTFOLIOS MAY INVEST

Illiquid Securities. An underlying fund may invest not more than 15% of its
assets in securities for which there is no readily available market ("Illiquid
Securities") which would include certain restricted securities the disposition
of which would be subject to legal restrictions and repurchase agreements having
more than seven days to maturity. A considerable period of time may elapse
between an underlying fund's decision to dispose of such securities and the time
when the fund is able to dispose of them, during which time the value of the
securities (and therefore the value of the underlying fund's shares held by a
Portfolio) could decline.

Foreign Securities. An underlying fund may invest up to 100% of its assets in
securities of foreign issuers. There may be less publicly available information
about these issuers than is available about companies in the U.S. and foreign
auditing requirements may not be comparable to those in the U.S. In addition,
the value of the fund's foreign securities may be adversely affected by
fluctuations in the exchange rates between foreign currencies and the U.S.
dollar, as well as other political and economic developments, including the
possibility of expropriation, confiscatory taxation, exchange controls or other
foreign governmental restrictions. In addition, income received by an underlying
fund from sources within foreign countries, such as dividends and interest
payable on foreign securities, may be subject to foreign taxes, including taxes
withheld from payments on those securities. Moreover, the underlying funds will
generally calculate their net asset values and complete orders to purchase,
exchange or redeem shares only on a Monday-Friday basis (excluding holidays on
which the New York Stock Exchange ("NYSE") is closed). Foreign securities in
which the underlying funds may invest may be listed primarily on foreign stock
exchanges which may trade on other days (such as Saturday or NYSE holidays). As
a result, the net asset value of an underlying fund's portfolio may be
significantly affected by such trading on days when the Adviser does not have
access to the underlying funds and shareholders of the Trust do not have access
to their respective Portfolios. Under the 1940 Act, an underlying fund may
maintain its foreign securities in custody of non-U.S. banks and securities
depositories.

Industry Concentration. An underlying fund may concentrate its investments
within one industry. Because the scope of investment alternatives within an
industry is limited, the value of the shares of such an underlying fund may be
subject to greater market fluctuation than an investment in a fund which invests
in a broader range of securities.

Master Demand Notes. Although the Portfolios themselves will not do so,
underlying funds (particularly money market mutual funds) may invest up to 100%
of their assets in master demand notes. Master demand notes are unsecured
obligations of U.S. corporations redeemable upon notice that permit investment
by a fund of fluctuating amounts at varying rates of interest pursuant to direct
arrangements between the fund and the issuing corporation. Because they are
direct arrangements between the fund and the issuing corporation, there is no
secondary market for the notes. However, they are redeemable at face value, plus
accrued interest, at any time.

Repurchase Agreements. Underlying funds, particularly money market funds, may
enter into repurchase agreements with banks and broker-dealers under which they
acquire securities subject to an agreement with the seller to repurchase the
securities at an agreed upon time and price. The Portfolios also may enter into
repurchase agreements. These agreements are considered under the 1940 Act to be
loans by the purchaser that are collateralized by the underlying securities. If
the seller should default on its obligation to repurchase the securities, the
underlying fund may experience delay or difficulties in exercising its rights to
dispose of the securities held as collateral and might incur a loss if the value
of the securities should decline. For a more complete discussion of repurchase
agreements, see "Investment Policies" in the SAI.

Loans of Portfolio Securities. An underlying fund may lend its portfolio
securities provided it complies with the following general requirements: (i) the
loan is secured continuously by collateral consisting of U.S. government
securities or cash or cash equivalents maintained on a daily mark-to-market
basis in an amount at least equal to the current market value of the securities
loaned; (ii) the fund may at any time call the loan and obtain the return of the
securities loaned; (iii) the fund will receive any interest or dividends paid on
the loaned securities; and (iv) the aggregate market value of securities loaned
will not at any time exceed one-third of the total assets of the fund. Loans of
securities involve a risk that the borrower may fail to return the securities or
may fail to provide additional collateral.

Short Sales. An underlying fund may sell securities short. In a short sale, the
fund sells stock which it does not own, making delivery with securities
"borrowed" from a broker. The fund is then obligated to replace the security
borrowed by purchasing it at the market price at the time of replacement. This
price may or may not be less than the price at which the security was sold by
the fund. Until the security is replaced, the fund is required to pay to the
lender any dividends or interest which accrue during the period of the loan. In
order to borrow the security, the fund may also have to pay a premium which
would increase the cost of the security sold. The proceeds of the short sale
will be retained by the broker, to the extent necessary to meet margin
requirements, until the short position is closed out.

The fund also must deposit in a segregated account (or earmark) an amount of
cash or U.S. government securities equal to the difference between (a) the
market value of the securities sold short at the time they were sold short and
(b) the value of the collateral deposited with the broker in connection with the
short sale (not including the proceeds from the short sale). While the short
position is open, the fund must maintain daily the segregated account at such a
level that (i) the amount deposited in it plus the amount deposited with the
broker as collateral equals the current market value of the securities sold
short and (ii) the amount deposited in it plus the amount deposited with the
broker as collateral is not less than the market value of the securities at the
time they were sold short. Depending upon market conditions, up to 80% of the
value of a fund's net assets may be deposited as collateral for the obligation
to replace securities borrowed to effect short sales and allocated to a
segregated account in connection with short sales.

The underlying fund will incur a loss as a result of the short sale if the price
of the security increases between the date of the short sale and the date on
which the fund replaces the borrowed security. The fund will realize a gain if
the security declines in price between those dates. The amount of any gain will
be decreased and the amount of any loss increased by the amount of any premium,
dividends or interest the fund may be required to pay in connection with a short
sale.

A short sale is "against the box" if at all times when the short position is
open the fund owns an equal amount of the securities or securities convertible
into, or exchangeable without further consideration for, securities of the same
issue as the securities sold short. Such a transaction serves to defer a gain or
loss for Federal income tax purposes.

Foreign Currency Transactions. In connection with its portfolio transactions in
securities traded in a foreign currency, an underlying fund may enter into
forward contracts to purchase or sell an agreed upon amount of a specific
currency at a future date which may be any fixed number of days from the date of
the contract agreed upon by the parties at a price set at the time of the
contract. Under such an arrangement, concurrently with the entry into a contract
to acquire a foreign security for a specified amount of currency, the fund would
purchase with U.S. dollars the required amount of foreign currency for delivery
at the settlement date of the purchase; the fund would enter into similar
forward currency transactions in connection with the sale of foreign securities.
The effect of such transactions would be to fix a U.S. dollar price for the
security to protect against a possible loss resulting from an adverse change in
the relationship between the U.S. dollar and the subject foreign currency during
the period between the date the security is purchased or sold and the date on
which payment is made or received, the normal range of which is three to 14
days. These contracts are traded in the interbank market conducted directly
between currency traders (usually large commercial banks) and their customers. A
forward contract generally has no deposit requirement and no commissions are
charged at any stage for trades. Although such contracts tend to minimize the
risk of loss due to a decline in the value of the subject currency, they tend to
limit commensurately any potential gain which might result should the value of
such currency increase during the contract period.

Leverage Through Borrowing. An underlying fund may borrow up to one-third of the
value of its net assets on an unsecured basis from banks to increase its
holdings of portfolio securities. Under the 1940 Act, the fund is required to
maintain continuous asset coverage of 300% with respect to such borrowings and
to sell (within three days) sufficient portfolio holdings to restore such
coverage if it should decline to less than 300% due to market fluctuations or
otherwise, even if disadvantageous from an investment standpoint. Leveraging
will exaggerate the effect of any increase or decrease in the value of portfolio
securities on the fund's net asset value, and money borrowed will be subject to
interest costs (which may include commitment fees and/or the cost of maintaining
minimum average balances) which may or may not exceed the interest and option
premiums received from the securities purchased with borrowed funds.

Warrants. An underlying fund may invest in warrants, which are options to
purchase equity securities at specific prices valid for a specific period of
time. The prices do not necessarily move parallel to the prices of the
underlying securities. Warrants have no voting rights, receive no dividends and
have no rights with respect to the assets of the issuer. If a warrant is not
exercised within the specified time period, it will become worthless and the
fund will lose the purchase price and the right to purchase the underlying
security.

High Yield Securities. An underlying fund may invest in high yield, high risk
securities. Investing in these securities (also called "junk bonds") involves
special risks in addition to the risks associated with investments in
higher-rated debt securities. High yield, high risk securities may be regarded
as predominantly speculative with respect to the issuer's continuing ability to
meet principal and interest payments.

High yield, high risk securities may be more susceptible to real or perceived
adverse economic and competitive industry conditions than higher grade
securities. The prices of high yield, high risk securities have been found to be
less sensitive to interest rate changes than more highly rated investments, but
more sensitive to adverse economic downturns or individual corporate
developments. A projection of an economic downturn or of a period of rising
interest rates, for example, could cause a decline in high yield, high risk
security prices because the advent of a recession could lessen the ability of a
highly leveraged company to make principal and interest payments on its debt
securities. If the issuer of high yield, high risk securities defaults, a fund
may incur additional expenses to seek recovery. In the case of high yield, high
risk securities structured as zero coupon or payment-in-kind securities, the
market prices of such securities are affected to a greater extent by interest
rate changes, and therefore tend to be more volatile than securities which pay
interest periodically and in cash.

The secondary markets on which high yield, high risk securities are traded may
be less liquid than the market for higher grade securities. Less liquidity in
the secondary trading markets could adversely affect and cause large
fluctuations in the daily net asset value of a fund's shares. Adverse publicity
and investor perceptions, whether or not based on fundamental analysis, may
decrease the values and liquidity of high yield, high risk securities,
especially in a thinly traded market.

There may be special tax considerations associated with investing in high yield,
high risk securities structured as zero coupon or payment-in-kind securities. A
fund records the interest on these securities as income even though it receives
no cash interest until the security's maturity or payment date. A fund will be
required to distribute all or substantially all such amounts annually and may
have to obtain the cash to do so by selling securities which otherwise would
continue to be held. Shareholders will be taxed on these distributions.

The use of credit ratings as the sole method of evaluating high yield, high risk
securities can involve certain risks. For example, credit ratings evaluate the
safety of principal and interest payments, not the market value risk of high
yield, high risk securities. Also, credit rating agencies may fail to change
credit ratings in a timely fashion to reflect events since the security was last
rated.

DERIVATIVES
An underlying fund may invest in the following instruments that are commonly
known as derivatives. Generally, a derivative is a financial arrangement, the
value of which is based on, or "derived" from, a traditional security, asset, or
market index.

Options Activities. An underlying fund may write (i.e., sell) listed call
options ("calls") if the calls are "covered" throughout the life of the option.
A call is "covered" if the fund owns the optioned securities. When a fund writes
a call, it receives a premium and gives the purchaser the right to buy the
underlying security at any time during the call period (usually not more than
nine months in the case of common stock) at a fixed exercise price regardless of
market price changes during the call period. If the call is exercised, the fund
will forgo any gain from an increase in the market price of the underlying
security over the exercise price.

A fund may purchase a call on securities only to effect a "closing purchase
transaction" which is the purchase of a call covering the same underlying
security and having the same exercise price and expiration date as a call
previously written by the fund on which it wishes to terminate its obligation.
If the fund is unable to effect a closing purchase transaction, it will not be
able to sell the underlying security until the call previously written by the
fund expires (or until the call is exercised and the fund delivers the
underlying security).

An underlying fund also may write and purchase put options ("puts"). When a fund
writes a put, it receives a premium and gives the purchaser of the put the right
to sell the underlying security to the fund at the exercise price at any time
during the option period. When a fund purchases a put, it pays a premium in
return for the right to sell the underlying security at the exercise price at
any time during the option period. An underlying fund also may purchase stock
index puts which differ from puts on individual securities in that they are
settled in cash based on the values of the securities in the underlying index
rather than by delivery of the underlying securities. Purchase of a stock index
put is designed to protect against a decline in the value of the portfolio
generally rather than an individual security in the portfolio. If any put is not
exercised or sold, it will become worthless on its expiration date.

A fund's option positions may be closed out only on an exchange which provides a
secondary market for options of the same series, but there can be no assurance
that a liquid secondary market will exist at a given time for any particular
option. In this regard, trading in options on certain securities (such as U.S.
government securities) is relatively new so that it is impossible to predict to
what extent liquid markets will develop or continue.

The underlying fund's custodian, or a securities depository acting for it,
generally acts as escrow agent as to the securities on which the fund has
written puts or calls, or as to other securities acceptable for such escrow so
that no margin deposit is required of the fund. Until the underlying securities
are released from escrow, they cannot be sold by the fund.

In the event of a shortage of the underlying securities deliverable on exercise
of an option, the Options Clearing Corporation ("OCC") has the authority to
permit other, generally comparable securities to be delivered in fulfillment of
option exercise obligations. If the OCC exercises its discretionary authority to
allow such other securities to be delivered, it may also adjust the exercise
prices of the affected options by setting different prices at which otherwise
ineligible securities may be delivered. As an alternative to permitting such
substitute deliveries, the OCC may impose special exercise settlement
procedures.

Futures Contracts. An underlying fund may enter into futures contracts for the
purchase or sale of debt securities and stock indexes. A futures contract is an
agreement between two parties to buy and sell a security or an index for a set
price on a future date. Futures contracts are traded on designated "contract
markets" which, through their clearing corporations, guarantee performance of
the contracts.

Generally, if market interest rates increase, the value of outstanding debt
securities declines (and vice versa). Entering into a futures contract for the
sale of securities has an effect similar to the actual sale of securities,
although sale of the futures contract might be accomplished more easily and
quickly. For example, if a fund holds long-term U.S. government securities and
it anticipates a rise in long-term interest rates, it could, in lieu of
disposing of its portfolio securities, enter into futures contracts for the sale
of similar long-term securities. If rates increased and the value of the fund's
portfolio securities declined, the value of the fund's futures contracts would
increase, thereby protecting the fund by preventing the net asset value from
declining as much as it otherwise would have. Similarly, entering into futures
contracts for the purchase of securities has an effect similar to the actual
purchase of the underlying securities, but permits the continued holding of
securities other than the underlying securities. For example, if the fund
expects long-term interest rates to decline, it might enter into futures
contracts for the purchase of long-term securities so that it could gain rapid
market exposure that may offset anticipated increases in the cost of securities
it intends to purchase while continuing to hold higher-yield short-term
securities or waiting for the long-term market to stabilize.

A stock index futures contract may be used to hedge an underlying fund's
portfolio with regard to market risk as distinguished from risk relating to a
specific security. A stock index futures contract does not require the physical
delivery of securities, but merely provides for profits and losses resulting
from changes in the market value of the contract to be credited or debited at
the close of each trading day to the respective accounts of the parties to the
contract. On the contract's expiration date, a final cash settlement occurs.
Changes in the market value of a particular stock index futures contract reflect
changes in the specified index of equity securities on which the future is
based.

There are several risks in connection with the use of futures contracts. In the
event of an imperfect correlation between the futures contract and the portfolio
position which is intended to be protected, the desired protection may not be
obtained and the fund may be exposed to risk of loss. Further, unanticipated
changes in interest rates or stock price movements may result in a poorer
overall performance for the fund than if it had not entered into futures
contracts on debt securities or stock indexes.

In addition, the market prices of futures contracts may be affected by certain
factors. First, all participants in the futures market are subject to margin
deposit and maintenance requirements. Rather than meeting additional margin
deposit requirements, investors may close futures contracts through offsetting
transactions which could distort the normal relationship between the securities
and futures markets. Second, from the point of view of speculators, the deposit
requirements in the futures market are less onerous than margin requirements in
the securities market. Therefore, increased participation by speculators in the
futures market may also cause temporary price distortions.

Finally, positions in futures contracts may be closed out only on an exchange or
board of trade which provides a secondary market for such futures. There is no
assurance that a liquid secondary market on an exchange or board of trade will
exist for any particular contract or at any particular time.

Options on Futures Contracts. A fund also may purchase and sell listed put and
call options on futures contracts. An option on a futures contract gives the
purchaser the right, in return for the premium paid, to assume a position in a
futures contract (a long position if the option is a call and a short position
if the option is a put), at a specified exercise price at any time during the
option period. When an option on a futures contract is exercised, delivery of
the futures position is accompanied by cash representing the difference between
the current market price of the futures contract and the exercise price of the
option. The fund may purchase put options on futures contracts in lieu of, and
for the same purpose as, a sale of a futures contract. It also may purchase such
put options in order to hedge a long position in the underlying futures contract
in the same manner as it purchases "protective puts" on securities.

As with options on securities, the holder of an option may terminate his
position by selling an option of the same series. There is no guarantee that
such closing transactions can be effected. The fund is required to deposit
initial margin and maintenance margin with respect to put and call options on
futures contracts written by it pursuant to brokers' requirements similar to
those applicable to futures contracts described above and, in addition, net
option premiums received will be included as initial margin deposits.

In addition to the risks which apply to all options transactions, there are
several special risks relating to options on futures contracts. The ability to
establish and close out positions on such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
this market will develop. Compared to the use of futures contracts, the purchase
of options on futures contracts involves less potential risk to the fund because
the maximum amount at risk is the premium paid for the options (plus transaction
costs). However, there may be circumstances when the use of an option on a
futures contract would result in a loss to the fund when the use of futures
contract would not, such as when there is no movement in the prices of the
underlying securities. Writing an option on a futures contract involves risks
similar to those arising in the sale of futures contracts, as described above.

Hedging. An underlying fund may employ many of the investment techniques
described in this section not only for investment purposes which may be
considered speculative, but also for hedging purposes. For example, an
underlying fund may purchase or sell put and call options on common stocks to
hedge against movements in individual common stock prices, or purchase and sell
stock index futures and related options to hedge against marketwide movements in
common stock prices. Although such hedging techniques generally tend to minimize
the risk of loss that is hedged against, they also may limit commensurately the
potential gain that might have resulted had the hedging transaction not
occurred. Also, the desired protection generally resulting from hedging
transactions may not always be achieved.

INVESTMENT POLICIES AND RESTRICTIONS

The Portfolios have adopted certain fundamental investment policies (i.e.,
policies which may not be changed as to a Portfolio without the vote of a
majority of that Portfolio's outstanding shares, as defined under "Other
Information--Voting") as well as certain investment policies which are not
fundamental and therefore may be changed by the Trustees without shareholder
approval. These policies reflect self-imposed standards or the requirements of
federal law.

The Trust may, in the future, seek to achieve each Portfolio's investment
objective by investing all of the Portfolio's assets in a no-load, diversified,
open-end management investment company having substantially the same investment
objective as the Portfolio. Each Portfolio's investment policies permit such an
investment. Shareholders will receive prior written notice with respect to any
such investment.

Under each Portfolio's fundamental investment policies, no Portfolio may invest
more than 25% of its total assets in the securities of underlying funds which
themselves concentrate (i.e., invest more than 25% of their assets) in any one
industry. Nevertheless, through its investment in underlying funds, a Portfolio
indirectly may invest more than 25% of its assets in one industry. The Portfolio
also may not borrow money, except that a Portfolio may, as a temporary measure
for extraordinary or emergency purposes, borrow from a bank in an amount not in
excess of 5% of the Portfolio's total assets, or pledge or hypothecate its
assets, except that the Portfolio may pledge not more than 5% of its total
assets to secure such borrowings. A Portfolio will not make additional
investments at any time during which it has outstanding borrowings.

Under each Portfolio's policies which are not fundamental, no Portfolio may (i)
purchase or otherwise acquire the securities of any open-end investment company
(except in connection with a merger, consolidation, acquisition of substantially
all of the assets or reorganization of another investment company) if, as a
result, a Portfolio and all of its affiliates including the other Portfolios
would own more than 3% of the total outstanding stock of that company, or (ii)
purchase a security which is not readily marketable if, as a result, more than
15% of that Portfolio's net assets would consist of such securities. For this
purpose, securities which are not readily marketable include repurchase
agreements having more than seven days to maturity (see "Investments of and
Investment Techniques Employed by Mutual Funds in Which the Portfolios May
Invest") and may include shares of an open-end investment company owned by the
Portfolio in an amount exceeding 1% of the issuer's total outstanding
securities. See "Risks and Other Considerations."

Each Portfolio may invest up to 5% of its net assets in repurchase agreements
with banks and broker-dealers. This and other investment policies and
restrictions are discussed in the SAI under the heading "Investment Policies."

The underlying funds in which a Portfolio invests may, but need not, have the
same investment policies as the Portfolio. For example, although Aggressive
Growth Portfolio will not borrow money for investment purposes, it may invest
its assets in an underlying fund which borrows money for investment purposes
(i.e., engages in leveraging). The investments which may be made by underlying
funds in which the Portfolios invest and the risks associated with those
investments are described under "Investment Objectives," "Investment Policies
and Restrictions" and "Investments of and Investment Techniques Employed by
Mutual Funds in Which the Portfolios May Invest."

RISKS AND OTHER CONSIDERATIONS

Any investment in a mutual fund involves risk and, although the Portfolios
invest in a number of underlying funds, this practice does not eliminate
investment risk. Moreover, investing through the Portfolios in an underlying
portfolio of mutual funds involves certain additional expenses and certain tax
results which would not be present in a direct investment in the underlying
funds. See "Expenses" and "Dividends, Distributions and Taxes."

A Portfolio, together with the other Portfolios and any "affiliated persons" (as
defined in the 1940 Act) may purchase only up to 3% of the total outstanding
securities of any underlying fund. For this purpose, shares of underlying funds
held by private discretionary investment advisory accounts managed by the
Adviser will be aggregated with those held by the Portfolios. Accordingly, when
affiliated persons and other accounts managed by the Adviser hold shares of any
of the underlying funds, each Portfolio's ability to invest fully in shares of
those funds is restricted, and the Adviser must then, in some instances, select
alternative investments that would not have been its first preference.

The 1940 Act also provides that an underlying fund whose shares are purchased by
a Portfolio will be obligated to redeem shares held by the Portfolio only in an
amount up to 1% of the underlying fund's outstanding securities during any
period of less than 30 days. Shares held by a Portfolio in excess of 1% of an
underlying fund's outstanding securities, therefore, may be considered not
readily marketable securities which together with other such securities may not
exceed 15% of that Portfolio's net assets. See "Investment Policies and
Restrictions." These limitations are not fundamental investment policies and may
be changed by the Trustees without shareholder approval.

Under certain circumstances, an underlying fund may determine to make payment of
a redemption by a Portfolio wholly or partly by a distribution in kind of
securities from its portfolio, in lieu of cash, in conformity with the rules of
the SEC. In such cases, the Portfolios may hold securities distributed by an
underlying fund until the Adviser determines that it is appropriate to dispose
of such securities.

Investment decisions by the investment advisers of the underlying funds are made
independently of the Trust and its Adviser. Therefore, the investment adviser of
one underlying fund may be purchasing shares of the same issuer whose shares are
being sold by the investment adviser of another such fund. The result of this
would be an indirect expense to a Portfolio without accomplishing any investment
purpose.

Each Portfolio may purchase shares of both load and no-load underlying funds. To
the extent an underlying fund offers multiple classes of shares, the Portfolios
will purchase the share class available to it with the lowest sales charges.
However, the Portfolios will not invest in shares of underlying funds which are
sold with a contingent deferred sales charge.

Under the 1940 Act, a mutual fund must sell its shares at the price (including
sales load, if any) described in its prospectus, and current rules under the
1940 Act do not permit negotiation of sales charges. Therefore, a Portfolio
currently is not able to negotiate the level of the sales charges at which it
will purchase shares of load funds, which may be as great as 8.5% of the public
offering price (or 9.29% of the net amount invested). Nevertheless, when
appropriate, a Portfolio will purchase such shares pursuant to (i) letters of
intent, permitting it to obtain reduced sales charges by aggregating its
intended purchases over time (generally 13 months from the initial purchase
under the letter); (ii) rights of accumulation, permitting it to obtain reduced
sales charges as it purchases additional shares of an underlying fund; and (iii)
the right to obtain reduced sales charges by aggregating its purchases of
several funds within a family of mutual funds. Based upon these privileges, it
is expected that, in the majority of cases, the sales charges paid by a
Portfolio on a load fund purchase will not exceed 1% of the public offering
price (1.01% of the net amount invested). See "Portfolio Transactions."

Under certain circumstances, a sales charge incurred by a Portfolio in acquiring
shares of an underlying fund may not be taken into account in determining the
gain or loss for federal income tax purposes on the disposition of the shares
acquired. If shares are disposed of within 90 days from the date they were
purchased and if shares of a new underlying fund are subsequently acquired
without imposition of a sales charge or imposition of a reduced sales charge
pursuant to a right granted to the Portfolio to acquire shares without payment
of a sales charge or with the payment of a reduced charge, then the sales charge
paid upon the purchase of the initial shares will be treated as paid in
connection with the acquisition of the new underlying fund's shares rather than
the initial shares.

EXPENSES
As an investor in the Portfolios, you should recognize that you may invest
directly in mutual funds and that, by investing in mutual funds indirectly
through the Portfolios, you will bear not only your proportionate share of the
expenses of the Portfolios (including operating costs and investment advisory
and administrative fees) but also, indirectly, similar expenses of the
underlying funds. If you are an investor in the Portfolios through a managed
account program and pay an advisory fee for asset allocation, you should
recognize that the combined expenses of the program and of the Portfolios
(including their indirect expenses) may involve greater fees and expenses than
present in other types of investments without the benefit of professional asset
allocation recommendations. In addition, as a Portfolio shareholder, you will
bear your proportionate share of expenses related to the distribution of the
Portfolio's Shares, see "Management of the Trust--The Distributors," and also
may indirectly bear expenses paid by an underlying fund related to the
distribution of its shares. As a Portfolio shareholder, you also will bear your
proportionate share of any sales charges incurred by the Portfolio related to
the purchase of shares of the underlying funds. Finally, as an investor, you
should recognize that, as a result of the Portfolios' policies of investing in
other mutual funds, you may receive taxable capital gains distributions to a
greater extent than would be the case if you invested directly in the underlying
funds. See "Dividends, Distributions and Taxes."

MANAGEMENT OF FUNDMANAGER PORTFOLIOS

The business and affairs of the Trust are managed under the direction of the
Trustees. Additional information about the Trustees, as well as the Trust's
executive officers, may be found in the SAI under the heading "Management
Trustees and Officers."

THE ADVISER
Freedom Capital Management has its principal office at One Beacon Street,
Boston, Massachusetts. The Adviser advises the Trust through the M.D. Hirsch
Division of Freedom Capital Management. Michael D. Hirsch, Chairman of the M.D.
Hirsch Division of Freedom Capital Management, has provided discretionary
investment advisory services relating to investments in mutual funds to
individual accounts since 1975.

Freedom Capital Management is an indirect, wholly-owned subsidiary of JHFSC
Acquisition Corp. whose stock is held by the following companies in the
approximate percentages: Thomas H. Lee Equity Fund III, L.P. (49%), a
Massachusetts limited partnership; SCP Private Equity Partners, L.P. (13%), a
Delaware limited partnership; John Hancock Subsidiaries, Inc. (4.9%), a
wholly-owned subsidiary of John Hancock Mutual Life Insurance Company; and
certain members of management and employees of John Hancock Freedom Securities
Corporation (the direct parent of the Adviser and a subsidiary of JHFSC
Acquisition Corp.) and its subsidiaries, including the Adviser (32%). Prior to
November 29, 1996, Freedom Capital Management was an indirect, wholly-owned
subsidiary of John Hancock Mutual Life Insurance Company ("John Hancock"). John
Hancock is a major mutual life insurance company based in Boston, Massachusetts.

Pursuant to an Investment Advisory Contract, the Adviser is responsible for the
investment management of each Portfolio's assets, including the responsibility
for making investment decisions and placing orders for the purchase and sale of
the Portfolio's investments directly with the issuers or with brokers or
dealers, selected by it in its discretion, including Freedom Distributors and
Edgewood. See "Portfolio Transactions." The Adviser also furnishes to the
Trustees, which have overall responsibility for the business and affairs of the
Trust, periodic reports on the investment performance of the Trust. For these
services, the Adviser receives from each Portfolio a fee, payable monthly, at
the annual rate of 0.50% of that Portfolio's average daily net assets up to $500
million and 0.40% of its average daily net assets in excess of $500 million.

Michael D. Hirsch is the Portfolio Manager of the Portfolios and is responsible
for the day to day management of the Portfolios. Currently, Mr. Hirsch is
Chairman of the M.D. Hirsch Division of Freedom Capital Management. Prior to
February 21, 1995, Mr. Hirsch was the Vice Chairman and Managing Director of the
M.D. Hirsch Division of Republic Asset Management. Mr. Hirsch served as
President of Hirsch from February, 1991 until June, 1993 and Chief Investment
Officer of Republic from 1981 until February, 1991. Mr. Hirsch pioneered the
concept of investing his clients' assets in a portfolio of mutual funds in 1975.
Mr. Hirsch is now a noted authority on mutual funds and has authored two books,
"Multifund Investing" in 1987 and "The Mutual Fund Wealth Builder" in 1991.

Martin S. Orgel is the Senior Investment Analyst and Assistant Portfolio Manager
for the Portfolios. Mr. Orgel graduated from the University of California at Los
Angeles (U.C.L.A.) in 1994 with a B.A. degree, double-majoring in Business
Economics and Political Science. Upon graduating from school, Mr. Orgel spent a
brief tenure as a trading assistant with Swiss Bank Corporation. Mr. Orgel began
working for Freedom Capital on November 27, 1995.

THE ADMINISTRATOR
FAS, a wholly-owned subsidiary of Federated Investors with its principal
business offices at Federated Investors Tower, Pittsburgh, Pennsylvania
15222-3779, provides administrative personnel and services (including certain
legal and financial reporting services) necessary to operate the Portfolios. FAS
provides these at an annual rate which relates to the average aggregate daily
net assets of the Portfolios as specified below:

Maximum
Administrative Average Aggregate
Fee Daily Net Assets
.150% on the first $250 million
.125% on the next $250 million
.100% on the next $250 million
.075% on assets in excess of $750 million

The administrative fee received during any fiscal year shall be at least $75,000
per Portfolio and $35,000 per each additional class of shares. FAS may choose
voluntarily to waive a portion of its fee or minimums from time to time in its
sole discretion.

THE DISTRIBUTORS
The Trustees of the Trust have approved a Distribution Contract (the
"Distribution Contract") between the Trust and each of Edgewood, Freedom
Distributors, Tucker Anthony and Sutro pursuant to which each will serve as a
Distributor of the Trust and of the Shares of each of the Portfolios.

Pursuant to a Distribution Plan adopted by the Portfolios with respect to the
Class (the "Plan"), each Portfolio will reimburse the Distributors monthly
(subject to a limit of 0.50% per annum of the Portfolio's average daily net
assets attributable to the Class) for costs and expenses incurred by the
Distributors in connection with the distribution of Portfolio Shares and for the
provision of certain shareholder services with respect to Portfolio Shares.
Payments to the Distributors will be for various types of activities, including:
(i) payments to broker-dealers who advise shareholders regarding the purchase,
sale, or retention of Portfolio Shares and who provide shareholders with
personal services and account maintenance services ("service fee"), (ii)
payments to employees of the Distributors, and (iii) printing and advertising
expenses. Such payments by the Distributors to broker-dealers may be in amounts
up to 0.50% per annum of each Portfolio's average daily net assets attributable
to the Class, provided, however, that the service fee will be limited to 0.25%
of each Portfolio's average daily net assets attributable to the Class. The fees
and reimbursements paid by the Portfolios to the Distributors may equal up to
0.50% of each Portfolio's average daily net assets attributable to the Class, of
which up to 0.25% of the Portfolio's average daily net assets may be paid for
shareholder servicing expenses. Salary expense of salesmen who are responsible
for marketing Shares of the Portfolios and related travel expenses may be
allocated to various Portfolios on the basis of average net assets attributable
to the Class.

Any payment by a Distributor or reimbursement of a Distributor by the Portfolio
made pursuant to the Plan is contingent upon the Trustees' approval. Each
Portfolio will not be liable for distribution and shareholder servicing
expenditures in any given year in excess of the maximum amount (0.50% per annum
of each Portfolio's average daily net assets attributable to the Class) payable
under the Plan in that year. The Plan also permits the Distributors to receive
and retain brokerage commissions with respect to portfolio transactions for
underlying funds, including funds which have a policy of considering sales of
their shares in selecting broker-dealers for the execution of their portfolio
transactions.

The Distributors may provide promotional incentives to investment executives who
support the sale of shares of the Portfolios. In some instances, these
incentives may be offered only to certain investment executives which provide
services in connection with the sale or expected sale of significant amounts of
shares.

Edgewood, a registered broker/dealer, is a wholly-owned subsidiary of Federated
Investors with principal business offices at Clearing Operations, P.O. Box 897,
Pittsburgh, Pennsylvania 15230-0897. Freedom Distributors is a registered
broker/dealer with principal business offices at One Beacon Street, Boston,
Massachusetts 02108. Tucker Anthony is a brokerage firm which is a member of the
New York Stock Exchange continuing an investment banking and brokerage business
established in 1892. The principal business address of Tucker Anthony is One
Beacon Street, Boston, Massachusetts 02108. Sutro is brokerage firm and a member
of the New York Stock Exchange. The principal business address of Sutro is 201
California Street, San Francisco, California 94111. Freedom Distributors, Tucker
Anthony, and Sutro are subsidiaries of John Hancock Freedom Securities
Corporation. See description of "The Adviser" above.

CUSTODIAN State Street Bank and Trust Company ("State Street Bank") provides
custodial and portfolio accounting services to the Trust and the Portfolios. The
principal business address of State Street Bank is P.O. Box 8600, Boston,
Massachusetts 02266-8600.

TRANSFER AGENT, DIVIDEND DISBURSING AGENT, AND SHAREHOLDER SERVICING AGENT
Federated Shareholder Services Company ("FSSC") maintains all necessary
shareholder records. All written correspondence, including purchase and
redemption requests, changes of address and other shareholder account changes,
should be sent to: FundManager Portfolios, c/o Federated Shareholder Services
Company, P.O. Box 8609, Boston, Massachusetts, 02266-8609.

SERVICE ORGANIZATIONS
The Trust also contracts with various banks, trust companies, broker-dealers
(other than the Distributors) or other financial organizations (collectively,
"Service Organizations") to provide administrative services for the Class such
as maintaining shareholder accounts and records. Each Portfolio pays fees to
Service Organizations (which vary depending upon the services provided) in
amounts up to an annual rate of 0.25% of the daily net asset value of a
Portfolio's Shares owned by shareholders with whom the Service Organization has
a servicing relationship.

Some Service Organizations may impose additional or different conditions on
their clients such as requiring their clients to invest more than the minimum
initial or subsequent investments specified by the Trust or charging a direct
fee for servicing. If imposed, these fees would be in addition to any amounts
which might be paid to the Service Organization by the Trust. Each Service
Organization has agreed to transmit to its clients a schedule of any such fees.
Shareholders using Service Organizations are urged to consult them regarding any
such fees or conditions.

OTHER EXPENSES
The Trust bears all costs of its operations other than expenses specifically
assumed by the Administrator, Distributors or the Adviser. See "Management" in
the SAI. Expenses directly attributable to a Portfolio or class are charged to
that Portfolio or class; other expenses are allocated proportionately among the
Portfolios or class, as the case may be, in relation to the net assets of each
Portfolio or class.

PORTFOLIO TRANSACTIONS
Pursuant to the Investment Advisory Contract, the Adviser places orders for the
purchase and sale of portfolio investments for a Portfolio's accounts with
brokers or dealers, selected by it in its discretion, including Freedom
Distributors and Edgewood. With respect to purchases of certain money market
instruments, purchase orders are placed directly with the issuer or its agent.
With respect to purchases of shares of underlying funds, the Portfolio may pay a
sales charge. Sales charges of the underlying funds generally consist of two
parts, the "dealer reallowance" (which typically comprises at least 80% of the
amount of the charge and is paid to the broker participating in the sale of the
underlying fund shares) and the underwriter's retention. To the extent
permissible by law, Freedom Distributors and Edgewood will be designated as the
participating brokers entitled to receive the dealer reallowance portion of the
sales charge on purchases of load fund shares by the Portfolios. However,
Freedom Distributors will not retain any dealer reallowance in excess of 1% of
the public offering price on any transaction nor will it be designated as the
broker entitled to receive the dealer reallowance portion of the sales charge
where such reallowance would exceed 1% of the public offering price. With
respect to purchases of underlying fund shares, the Adviser directs
substantially all of the Portfolios' orders to either Freedom Distributors or
Edgewood, which may, in its discretion, direct the order to other broker-dealers
in consideration of sales of that Portfolio's shares, except where the direction
to another broker-dealer would increase the dealer reallowance paid by a fund to
Freedom Distributors above 1% of the public offering price.

Freedom Distributors and Edgewood may also assist in the execution of a
Portfolio's purchase of underlying fund shares and they may receive additional
compensation (such as distribution payments, shareholder servicing fees, and/or
trailer fees) from the underlying funds or their underwriters. In providing
execution assistance, Freedom Distributors and Edgewood receive orders from the
Adviser; place them with the underlying fund's distributor, transfer agent or
other person, as appropriate; confirm the trade, price and number of shares
purchased; and assure prompt payment by the Portfolio and proper completion of
the order. Payment of sales charges or other forms of compensation to Freedom
Distributors or Edgewood is not a factor that the Adviser considers when
selecting an underlying fund for purchase.

Each Portfolio is actively managed and has no restrictions upon portfolio
turnover, although its annual turnover rate is not expected to exceed 100%. A
100% annual portfolio turnover rate would be achieved if each security in each
Portfolio's portfolio (other than securities with less than one year remaining
to maturity) were replaced once during the year. To the extent each Portfolio is
purchasing shares of load funds, a higher turnover rate would result in
correspondingly higher sales loads paid by that Portfolio. Trading also may
result in realization of net short-term capital gains which would not otherwise
be realized, and shareholders are taxed on such gains when distributed from that
Portfolio at ordinary income tax rates. See "Dividends, Distributions and
Taxes." There is no limit on the portfolio turnover rates of the underlying
funds in which the Portfolio may invest.

DETERMINATION OF NET ASSET VALUE
The net asset value per share of each Portfolio is determined as of the close of
trading (normally 4:00 p.m., Eastern time) on the NYSE, Monday through Friday,
except on: (i) days on which there are not sufficient changes in the value of a
Portfolio's portfolio securities that its net asset value might be materially
affected; (ii) days during which no shares are tendered for redemption and no
orders to purchase shares are received; and (iii) the following holidays: New
Year's Day, Martin Luther King Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. Net asset
value per share is calculated by dividing the aggregate value of a Portfolio's
assets allocable to the Class less all liabilities by the number of that Class'
outstanding shares.

The assets of each Portfolio consist primarily of the underlying funds, which
are valued at their respective net asset values under the 1940 Act. The
underlying funds value securities in their portfolios for which market
quotations are readily available at their current market value (generally the
last reported sale price) and all other securities and assets at fair value
pursuant to methods established in good faith by the boards of directors or
trustees of the underlying fund. Money market mutual funds may use the amortized
cost or penny-rounding methods to value their securities. Securities having 60
days or less remaining to maturity generally are valued at their amortized cost
which approximates market value.

Other assets of each Portfolio are valued at their current market value if
market quotations are readily available and, if market quotations are not
available, they are valued at fair value pursuant to methods established in good
faith by the Trustees. Debt instruments having 60 days or less remaining to
maturity are valued at their amortized cost.

PURCHASE OF SHARES

Shares of the Portfolios are offered by the Distributors as an investment
vehicle for individuals, institutions, corporations and fiduciaries. Shares of
the Portfolios may also be offered to participants in certain managed account
programs who receive, for a fee at a maximum annual rate based upon a percentage
of assets invested, certain services, including asset allocation recommendations
with respect to the Portfolios based on an evaluation of their investment
objectives and risk tolerances. Each Portfolio pays expenses related to the
distribution of its shares. See "Management of the Trust--The Distributors."
Each Portfolio may invest in underlying funds which are sold with a sales
charge. Prospectuses, sales material and applications relating to the Portfolios
can be obtained from the Distributors.

The minimum initial investment is $1,000, except that the minimum initial
investment for an IRA is $250. The minimum subsequent investment is $100. There
are no minimum investment requirements for FundManager prototype defined
contribution plans. The minimum initial investment is waived for purchases by
Trustees, officers and employees of the Trust, the Adviser or a Distributor,
including their immediate families and certain accounts. Each Portfolio also
reserves the right to vary the initial and subsequent investment minimums. All
purchase payments are invested in full and fractional shares. The Trust and each
Distributor are authorized to reject any purchase order.

For each shareholder of record, the Trust, as the shareholder's agent,
establishes an open account to which all shares purchased are credited together
with any dividends and capital gains distributions which are paid in additional
shares. See "Dividends, Distributions and Taxes."

PURCHASES BY CLIENTS OF THE DISTRIBUTORS OR AUTHORIZED SECURITIES DEALERS

If you have a brokerage account or Program account with a Distributor or an
authorized securities dealer, you may purchase any Portfolio's Shares through
your investment executive. Your investment executive has the responsibility of
submitting your purchase order to FSSC on such day in order to obtain that day's
applicable purchase price. Purchase orders received by FSSC after the time of
determining that day's purchase price (generally 4:00 p.m., New York time), are
priced according to the net asset value per Share of the Portfolio next
determined on the following business day. Payment for purchase orders must be
made to such Distributor or dealer within three business days of the purchase
order.

The Distributor or your dealer will receive statements and dividends directly
from the Portfolios and will in turn provide you with account statements
reflecting the Portfolios' purchases, redemptions and dividend payments. If you
wish additional information concerning your investment, please call your
investment executive.

CERTAIN SERVICE ORGANIZATIONS AND OTHER INVESTORS--PURCHASE BY CHECK OR WIRE
Purchase by Mail. If you do not have a brokerage account with a Distributor, you
may purchase shares of the Portfolios directly by completing the Purchase
Application included in this Prospectus and mailing it, together with a check
written on a U.S. bank in a minimum amount of $1,000 payable to [Name of
Portfolio], to FSSC, P.O. Box 8609, Boston, Massachusetts 02266-8609. Investors
wishing to purchase Shares through their account at a Service Organization
should contact the organization directly for appropriate instructions.

Subsequent purchases of $100 or more may also be made through FSSC by forwarding
payment, together with the detachable stub from your account statement or a
letter containing your account number.

Purchase by Wire. Service Organizations (on behalf of customers) may transmit
purchase payments by wire directly to the Portfolios' Custodian at the following
address:

State Street Bank and Trust CompanyBoston, MassachusettsABA #011000028Deposit
account #2303-298-0Portfolio Name: _________

Account # _________

For further credit to FundManager Portfolios--Financial Adviser Class (name of
Portfolio, account name, account #).

The wire order must specify the name of the Portfolio in which the investment is
being made, the account name, number, confirmation number, address, social
security or tax identification number (where applicable), amount to be wired,
name of the wiring bank and name and telephone number of the person to be
contacted in connection with the order. Where the initial purchase is by wire,
an account number will be assigned and a Purchase Application must be completed
and mailed to the Trust.

Investors making purchases through a Service Organization should be aware that
it is the responsibility of the Service Organization to transmit orders for
purchases of shares by its customers to the Transfer Agent and to deliver
required funds on a timely basis, in accordance with the procedures stated
above.

AUTOMATIC INVESTMENT PLAN

The Trust offers a plan for regularly investing specified dollar amounts ($25
minimum in monthly, quarterly, semiannual or annual intervals) in Shares of the
Portfolios. If an Automatic Investment Plan is selected, subsequent investments
will be automatic and will continue until such time as the Portfolio and the
investor's bank are notified to discontinue further investments. Due to the
varying procedures to prepare, process and forward the bank withdrawal
information to a Portfolio, there may be a delay between the time of the bank
withdrawal and the time the money reaches the Portfolio. The investment in the
Portfolio will be made at the public offering price per Share determined on the
day that both the check and bank withdrawal data are received in required form
by the Distributor. Further information about the plan may be obtained from FSSC
at the telephone number listed on the back cover of the Prospectus.

RETIREMENT PLANS
The Trust offers Shares of each Portfolio in connection with tax-deferred
retirement plans. Application forms and further information about these plans,
including applicable fees, are available from the Trust or a Distributor upon
request. Before investing in Shares of a Portfolio through one or more such
plans, an investor should consult a tax adviser regarding the Federal income tax
treatment of contributions to retirement plans, such as those listed below.

INDIVIDUAL RETIREMENT ACCOUNTS ("IRAs")
Shares of the Portfolios may be used as a funding medium for an IRA. An Internal
Revenue Service-approved IRA plan is available from each Distributor naming
State Street Bank as custodian. The minimum initial investment for an IRA is
$250; the minimum subsequent investment is $100. IRAs are available to
individuals who receive compensation or earned income and their spouses whether
or not they are active participants in a tax-qualified or government-approved
retirement plan. An IRA contribution by an individual who participates, or whose
spouse participates, in a tax-qualified or government-approved retirement plan
may not be deductible depending upon the individual's income. Individuals also
may establish an IRA to receive a "rollover" contribution of distributions from
another IRA or a qualified plan. Tax advice should be obtained before planning a
rollover.

DEFINED CONTRIBUTION PLAN
Investors who are self-employed may purchase Shares of the Portfolios for
retirement plans for self-employed persons which are known as Defined
Contribution Plans (formerly Keogh or H.R. 10 Plans). The Class offers a
prototype Defined Contribution Plan for Money Purchase or Profit Sharing Plans,
401(k) Plans, Simplified Employee Pension Plans (SEPs) and SAR (SEPs).

Section 401(k) Plan
Shares of the Portfolios may be used as a vehicle for a cash or deferred
arrangement designed to qualify under Section 401(k) of the Internal Revenue
Code of 1986, as amended (the "Code").

Section 403(b) Plan Shares of the Portfolios may be used as vehicle for certain
deferred compensation plans designed to qualify under Section 403(b) of the Code
for use by employees of certain educational, non-profit hospital and charitable
organizations.

Section 457 Plan
Shares of the Portfolios may be used as a vehicle for certain deferred
compensation plans provided for by Section 457 of the Code with respect to
service for state governments, local governments, rural electric cooperatives
and political subdivisions, agencies, instrumentalities and certain affiliates
of such entities which enjoy special treatment.

EXCHANGE PRIVILEGE

By contacting their brokerage account executive, service organization or
transfer agent, Financial Adviser Class Shareholders may exchange some or all of
their Portfolio Shares for Financial Adviser Class Shares of one or more of the
Trust's other portfolios or shares of Automated Cash Management Trust -
Institutional Service Shares, New York Municipal Cash Trust or California
Municipal Cash Trust (the "Fund" or "Funds", as the context requires) at net
asset value. The Funds offer checkwriting at no charge. An exchange may result
in a change in the number of shares held, but not in the value of such shares,
immediately after the exchange. Each exchange involves the redemption of the
Portfolio or Fund shares to be exchanged and the purchase of the Financial
Adviser Class Shares of the other Portfolio or Fund. As a result, any gain or
loss on the redemption of the shares exchanged is reportable on the
shareholder's Federal income tax return. The exchange privilege (or any aspect
of it) may be changed or discontinued upon 60 days' written notice to
shareholders and is available only to shareholders in states where such
exchanges may be legally made. A shareholder considering an exchange should
obtain and read the prospectus of the Portfolios or Fund and consider the
differences in investment objectives and policies before making any exchange.

For further information as to how to purchase or exchange shares, an investor
should contact their Service Organization or Transfer Agent.

REDEMPTION OF SHARES

Upon receipt by the Trust of a redemption request in proper form, shares of a
Portfolio will be redeemed at the next determined net asset value. See
"Determination of Net Asset Value." For the shareholder's convenience, the Trust
has established several different direct redemption procedures.

REDEMPTION OF SHARES PURCHASED THROUGH A DISTRIBUTOR OR AUTHORIZED SECURITIES
DEALER
In order to redeem your shares purchased through a brokerage account, you should
advise your investment executive, by telephone or mail, to execute the
redemption. Redemption requests received by the close of the NYSE (generally
4:00 p.m., New York time), are effective that day. Your investment executive has
the responsibility of submitting your redemption request to FSSC on such day in
order to obtain that day's applicable redemption price. There is no redemption
charge. Redemption proceeds will be held in your brokerage account unless you
give instructions to your investment executive to remit the proceeds to you.

DIRECT REDEMPTION Direct redemptions are not available for shares purchased
through a Distributor's brokerage account. Any such redemption requests received
will be forwarded to your investment executive who will process them as
described above.

Redemptions may be made by letter to the Trust specifying the dollar amount or
number of shares to be redeemed, account number and the applicable Portfolio.
The letter must be signed in exactly the same way the account is registered (if
there is more than one owner of the shares, all must sign) and all signatures
must be guaranteed by an Eligible Guarantor Institution, which includes a
domestic bank, broker, dealer, credit union, national securities exchange,
registered securities association, clearing agency or savings association. The
Portfolios' transfer agent, however, may reject redemption instructions if the
guarantor is neither a member of nor a participant in a signature guarantee
program (currently known as "STAMP," "SEMP," or "NYSE MSP"). Corporations,
partnerships, trusts or other legal entities may be required to submit
additional documentation.

An investor may redeem shares in any amount by written request mailed to the
Trust at the following address:

FundManager Portfolios c/o Federated Shareholder Services CompanyP.O. Box
8609Boston, Massachusetts 02266-8609

If shares to be redeemed are held in certificate form, the certificates must be
enclosed with the letter. Do not sign the certificates and for protection use
registered mail.

Checks for redemption proceeds normally will be mailed within three days, but
will not be mailed until all checks in payment for the purchase of the shares to
be redeemed have been cleared, which may take up to 15 days. Unless other
instructions are given in proper form, a check for the proceeds of a redemption
will be sent to the shareholder's address of record.

REDEMPTION BY WIRE OR TELEPHONE
An investor may redeem Portfolio Shares by wire or by telephone if the investor
has checked the appropriate box on the Purchase Application or has filed a
Telephone Authorization Form with the Portfolios. These redemptions may be paid
by the Portfolios by wire or by check. The Trust reserves the right to refuse
telephone wire redemptions and may limit the amount involved or the number of
telephone redemptions. The telephone redemption procedure may be modified or
ended at any time by the Trust. Instructions for wire redemptions are set forth
in the Purchase Application. The Trust employs reasonable procedures to confirm
that instructions communicated by telephone are genuine. For instance, the
following information must be verified by the shareholder or broker at the time
a request for a telephone redemption is effected: (i) shareholder's account
number; (ii) shareholder's social security number; and (iii) name and account
number of shareholder's designated securities dealer or bank. If the Trust fails
to follow these or other established procedures, it may be liable for any losses
due to unauthorized or fraudulent instructions.

A Service Organization may request a wire redemption, provided a Wire
Authorization Form is on file with the Trust. There is no charge to the Service
Organization for wire redemptions. The proceeds of a wire redemption will be
sent to an account with a Service Organization designated on the appropriate
form. The Trust reserves the right to restrict or terminate wire redemption
privileges. Proceeds of wire redemptions generally will be transferred within
three days after receipt of the request.

The Trust may suspend the right of redemption during any period when (i) trading
on the NYSE is restricted or the NYSE is closed, other than customary weekend
and holiday closings, (ii) the SEC has by order permitted such suspension or
(iii) an emergency, as defined by rules of the SEC, exists making disposal of
portfolio investments or determination of the value of the net assets of the
Portfolios not reasonably practicable.

If the Trustees should determine that it would be detrimental to the best
interests of the remaining shareholders of a Portfolio to make payment wholly or
partly in cash, that Portfolio may pay the redemption price in whole or in part
by a distribution in kind of readily marketable securities (mutual fund shares
or money market instruments) from the portfolio of that Portfolio, in lieu of
cash, in conformity with applicable rules of the SEC. The Trust will, however,
redeem shares solely in cash up to the lesser of $250,000 or 1% of its net
assets during any 90-day period for any one shareholder.

The proceeds of redemption may be more or less than the amount invested and,
therefore, a redemption may result in a gain or loss for Federal income tax
purposes.

Because the Portfolios incur fixed costs in maintaining shareholder accounts,
the Portfolios reserve the right to redeem your account if its total value falls
below $500 at the end of any month, unless the decrease is solely the result of
a reduction in net asset value per share. If a Portfolio elects to redeem your
account, it will notify you of its intention to do so and will provide you with
an opportunity to increase your account by investing a sufficient amount to
bring the account up to $500 or more within 30 days of the notice.

SYSTEMATIC WITHDRAWAL PLAN
Any shareholder who owns shares of a Portfolio with an aggregate value of
$10,000 or more may establish a Systematic Withdrawal Plan under which the
shareholder redeems at net asset value the number of full and fractional shares
which will produce the monthly, quarterly, semi-annual or annual payments
specified (minimum $50 per payment). Depending on the amounts withdrawn,
systematic withdrawals may deplete the investor's principal. Investors
contemplating participation in this Plan should consult their tax advisers. No
additional charge to the shareholder is made for this service.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Each Portfolio intends to continue to qualify as a regulated investment company
under Subchapter M of the Code. In any year in which a Portfolio qualifies as a
regulated investment company and distributes substantially all of its investment
company taxable income (which includes, among other items, the excess of net
short-term capital gains over netlong-term capital losses) and its net capital
gains (the excess of net long-term capital gains over net short-term capital
losses), the Portfolio will not be subject to Federal income tax to the extent
it distributes to shareholders such income and capital gains in the manner
required under the Code. Amounts not distributed on a timely basis in accordance
with a calendar year distribution requirement are subject to a nondeductible 4%
excise tax. To prevent imposition of the excise tax, each Portfolio must
distribute for each calendar year an amount equal to the sum of (i) at least 98%
of its net ordinary income (excluding any capital gains or losses) for the
calendar year, (ii) at least 98% of the excess of its capital gains over capital
losses (adjusted for certain ordinary losses) realized during the one-year
period ending October 31 of such year, and (iii) all ordinary income and capital
gains for previous years that were not distributed during such years. If a
distribution is declared by the Portfolio in December to shareholders of record
as of a specified date in December and paid by the Portfolio during January of
the following calendar year, the distribution will be treated as a dividend paid
during the calendar year. Such distributions will be taxable to shareholders in
the calendar year in which the distributions are declared, rather than the
calendar year in which the distributions are received. The Portfolio intends to
distribute its income in accordance with this requirement to prevent application
of the excise tax.

Each year the Trust will notify shareholders of the tax status of dividends and
distributions.

Income received by a Portfolio from a mutual fund in that Portfolio's portfolio
(including dividends and distributions of short-term capital gains), as well as
interest received on money market instruments and net short-term capital gains
received by the Portfolio on the sale of mutual fund shares, will be distributed
by the Portfolio (after deductions for expenses) and will be taxable to
shareholders as ordinary income. Because the Portfolios are actively managed and
can realize taxable net short-term capital gains by selling shares of an
underlying fund with unrealized portfolio appreciation, investing in the
Portfolio rather than directly in the underlying funds may result in increased
tax liability to the shareholder, since the Portfolio must distribute its gain
in accordance with the rules in the Code.

Distributions of net capital gains (the excess of net long-term capital gains
over net short-term capital losses) received by a Portfolio from mutual funds,
as well as net long-term capital gains realized by a Portfolio from the purchase
and sale (or redemption) of mutual fund shares or other securities held
(generally) by a Portfolio for more than one year, will be distributed by the
Portfolio and will be taxable to shareholders as long-term capital gains (even
if the shareholder has held the Shares for less than one year). However, if you
receive a capital gains distribution and suffer a loss on the sale of your
shares not more than six months after purchase, the loss will be treated as a
long-term capital loss to the extent of the capital gains distribution received.
The long-term capital gains, including distributions of net capital gains are
currently subject to a maximum federal tax rate of 28% which is less than the
maximum rate imposed on other types of taxable income. Furthermore, capital
gains may be advantageous because, unlike ordinary income, they may be offset by
capital losses.

For purposes of determining the character of income received by the Portfolio
when an underlying fund distributes net capital gains to the Portfolio, the
Portfolio will treat the distribution as a long-term capital gain, even if it
has held shares of the mutual fund for less than one year. However, any loss
incurred by the Portfolio on the sale of that underlying fund's shares held for
six months or less will be treated as a long-term capital loss to the extent of
the gain distribution.

The tax treatment of distributions from a Portfolio is the same whether the
distributions are received in additional shares or in cash. Shareholders
receiving distributions in the form of additional shares will have a cost basis
for Federal income tax purposes in each share received equal to the net asset
value of a share of the Portfolio on the reinvestment date.

A Portfolio may invest in underlying funds with capital loss carry-forwards. If
such an underlying fund realizes capital gains, it will be able to offset the
gains to the extent of its loss carry-forwards in determining the amount of
capital gains which must be distributed to its shareholders. To the extent that
gains are offset in this manner, the Portfolio will not realize gains on the
related fund until such time as the underlying fund is sold.

Depending on the residence of the shareholder for tax purposes, distributions
also may be subject to state and local taxes, including withholding taxes.
Shareholders should consult their own tax advisers as to the tax consequences of
ownership of shares of the Portfolios in their particular circumstances.

The Portfolios generally will be required to withhold Federal income tax at a
rate of 31% ("backup withholding") from dividends paid to shareholders if (a)
the payee fails to furnish the Trust with and to certify the payee's correct
taxpayer identification number or social security number, (b) the Internal
Revenue Service (the "IRS") notifies the Trust that the payee has failed to
report properly certain interest and dividend income to the IRS and to respond
to notices to that effect or (c) the payee fails to certify that he or she is
not subject to backup withholding.

Recent tax legislation will affect the above-described capital gains holding
periods and rates for the Portfolios and their shareholders, effective for
transactions on or after July 1, 1997. Consult your tax adviser for further
details.

Aggressive Growth Portfolio will distribute investment company taxable income
annually; Growth Portfolio will distribute investment company taxable income
semi-annually; Growth with Income Portfolio and Managed Total Return Portfolio
will distribute investment company taxable income quarterly; and Bond Portfolio
will distribute investment company taxable income monthly. Each Portfolio will
distribute any net realized capital gains at least annually. All dividends and
distributions will be reinvested automatically at net asset value in additional
shares of the Portfolio making the distribution, unless you have notified the
Portfolio in writing of your election to receive distributions in cash.

OTHER INFORMATION
Capitalization

The Trust (initially named FundManager Trust, and since renamed FundManager
Portfolios) was organized as a Delaware business trust on February 7, 1995 as a
successor, with respect to the Portfolios, to Republic Funds (formerly
FundTrust) a Massachusetts business trust (organized on April 22, 1987).
Republic Funds succeeded two previously existing Massachusetts business trusts,
FundTrust Tax-Free Trust (organized on July 30, 1986) and FundVest (organized on
July 17, 1984 and since renamed Fund Source). The Trust currently consists of
five separately-managed portfolios - Aggressive Growth Portfolio (formerly,
Aggressive Growth Fund), Growth Portfolio (formerly, Growth Fund), Growth with
Income Portfolio (formerly, Growth & Income Fund), Bond Portfolio (formerly,
Bond Fund, and before that, Income Fund), and Managed Total Return Portfolio
(formerly, Managed Total Return Fund) - each offering two classes of shares of
beneficial interest, the Financial Adviser Class and the No-Load Class (except
for Managed Total Return, which only offers Financial Adviser Class). The
Trustees may establish additional portfolios and divide shares in each portfolio
into additional classes in the future. The capitalization of the Trust consists
solely of an unlimited number of shares of beneficial interest with a par value
of $0.001 each. When issued, shares of the Portfolios are fully paid,
non-assessable and freely transferable.

Voting
Shareholders have the right to vote in the election of Trustees and on any and
all matters on which by law or the provisions of the Master Trust Agreement they
may be entitled to vote. When matters are submitted for shareholder vote,
shareholders will have one vote for each full share held and proportionate,
fractional votes for fractional shares held. A separate vote of a Portfolio or
class is required on any matter affecting that Portfolio or class on which
shareholders are entitled to vote. Shareholders of a Portfolio or class are not
entitled to vote on Trust matters that do not affect the Portfolio or class and
do not require a separate vote of the Portfolio or class. The Trust is not
required to hold regular annual meetings of its shareholders and does not intend
to do so. See "Other Information--Voting Rights" in the SAI. As of ___, 1997,
Turtle & Co. FC1202, c/o State Street Bank & Trust Company, P.O. Box 9242,
Boston, MA 02209, was the owner of record of 25.72% of the voting securities of
the Growth Portfolio, and therefore, may, for certain purposes be deemed to
control the Portfolio and be able to affect the outcome of certain matters
presented for a vote of shareholders. As of ___, 1997, Turtle & Co. FC1202, c/o
State Street Bank & Trust Company, P.O. Box 9242, Boston, MA 02209, was the
owner of record of 25.66% of the voting securities of the Growth with Income
Portfolio, and therefore, may, for certain purposes be deemed to control the
Portfolio and be able to affect the outcome of certain matters presented for a
vote of shareholders. As of ___, 1997, Turtle & Co. FC1202, c/o State Street
Bank & Trust Company, P.O. Box 9242, Boston, MA 02209, was the owner of record
of 73.98% of the voting securities of the Bond Portfolio, and therefore, may,
for certain purposes be deemed to control the Portfolio and be able to affect
the outcome of certain matters presented for a vote of shareholders.

The Master Trust Agreement provides that the holders of not less than
three-fourths of the outstanding shares of the Trust may remove a person serving
as Trustee either by declaration in writing or at a meeting called for such
purpose. The Trustees are required to call a meeting for the purpose of
considering the removal of a person serving as Trustee if requested in writing
to do so by the holders of not less than 10% of the outstanding shares of the
Trust.

Shares entitle their holders to one vote per share (with proportionate voting
for fractional shares). As used in this Prospectus, the phrase "vote of a
majority of the outstanding shares" of the Trust, Portfolio or Class means the
vote of the lesser of: (i) 67% of the shares of the Trust, Portfolio or Class
present at a meeting if the holders of more than 50% of the outstanding shares
of the Trust, Portfolio or Class are present in person or by proxy or (ii) more
than 50% of the outstanding shares of the Trust, Portfolio or Class.

In compliance with applicable provisions of the 1940 Act, shares of the
underlying funds owned by the Portfolios will be voted in the same proportion as
the vote of all other holders of those shares.

Performance Information
The Trust may, from time to time, include quotations of the Portfolios' yield
and total return in advertisements or reports to shareholders or prospective
investors. Quotations of yield will be based on the investment income per share
earned during a particular 30-day period (including dividends and interest),
less expenses accrued during the period ("net investment income"), and will be
computed by dividing net investment income by the maximum public offering price
per share on the last day of the period. Quotations of total return will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in the Portfolio over periods of 1, 5 and 10 years (up
to the life of such Portfolio). All total return figures will reflect a
proportional share of Portfolio expenses on an annual basis, and will assume
that all dividends and distributions are reinvested when paid. Quotations of
yield or total return reflect only the performance of a hypothetical investment
in the Portfolio during the particular time period on which the calculations are
based. Yield and total return for a Portfolio will vary based on changes in
market conditions and the level of such Portfolio's expenses, and no reported
performance figure should be considered an indication of performance which may
be expected in the future.

For the period prior to its establishment, the Class has adopted the performance
of the Predecessor Portfolios. The performance for this period will reflect the
deduction of expenses set forth in the Portfolio Expense Table. See " Portfolio
Expenses."

In connection with communicating the Portfolios' yield and total return to
current or prospective shareholders, the Trust also may compare these figures to
the performance of other mutual funds tracked by mutual fund rating services or
to other unmanaged indexes which may assume reinvestment of dividends but
generally do not reflect deductions for administrative and management costs and
expenses.

For a more detailed description of the methods used to calculate each
Portfolio's yield and total return, see the SAI.

OTHER CLASSES OF SHARES
The Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio
and Bond Portfolio also offer another class of shares called No-Load Class
shares. No-Load Class shares are sold at net asset value to participants in the
FundManager Advisory Program (the "Program"). The Program is an investment
advisory service that directly provides to investors asset allocation
recommendations with respect to the Portfolios based on an evaluation of an
investor's investment objectives and risk tolerances. The minimum investment by
participants in the Program is $50,000. The minimum initial investment for other
qualified investors of each Portfolio is $1,000, and the minimum subsequent
investment is $100 except that the minimum initial investment for an Individual
Retirement Account is $250.

Both classes are subject to certain of the same expenses. However, No-Load Class
shares are distributed without 12b-1 fees.

Expense differences between classes may affect the performance of each class.

SHAREHOLDER INQUIRES
All shareholder inquires should be directed to your investment executive or
financial adviser, or call (800) 344-9033 (Toll Free).

DESCRIPTION OF BOND RATINGS
Excerpts from Moody's description of its bond ratings: Aaa--judged to be the
best quality. They carry the smallest degree of investment risk; Aa--judged to
be of high quality by all standards. Together with the Aaa group they comprise
what are generally known as high grade bonds; A--possess many favorable
investment attributes and are to be considered as "upper medium grade
obligations"; Baa--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;
Ba--judged to have speculative elements, their future cannot be considered as
well assured; B--generally lack characteristics of the desirable investment;
Caa--are of poor standing. Such issues may be in default or there may be present
elements of danger with respect to principal or interest; Ca--speculative in a
high degree; often in default; C--lowest rated class of bonds; regarded as
having extremely poor prospects.

Moody's also supplies numerical indicators 1, 2 and 3 to rating categories. The
modifier 1 indicates that the security is in the higher end of its rating
category; the modifier 2 indicates a mid-range ranking; and 3 indicates a
ranking toward the lower end of the category.

Excerpts from S&P's description of its bond ratings: AAA--highest grade
obligations. Capacity to pay interest and repay principal is extremely strong;
AA--also qualify as high grade obligations. A very strong capacity to pay
interest and repay principal and differs from AAA issues only in a small degree;
A--regarded as upper medium grade. They have 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--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 in higher rated categories. This group is the lowest
which qualifies for commercial bank investment. BB, B, CCC, CC--predominantly
speculative with respect to capacity to pay interest and repay principal in
accordance with terms of the obligations; BB indicates the lowest degree of
speculation and CC the highest.

S&P applies indicators "+", no character, and "-" to its rating categories. The
indicators show relative standing within the major rating categories.

FUNDMANAGER PORTFOLIOS
(formerly, FundManager Trust)
One Beacon Street
Boston, Massachusetts 02108
Information: (800) 344-9033 (Toll Free)
STATEMENT OF ADDITIONAL INFORMATION
No-Load Class of Shares
Financial Adviser Class of Shares

FundManager Portfolios (the "Trust") is an open-end management investment
company consisting of five separate series (the "Portfolios"). The Portfolios
seek to achieve their objectives by investing in shares of other open-end
investment companies -- commonly called mutual funds.

Aggressive Growth Portfolio seeks capital appreciation without regard to current
income.

Growth Portfolio primarily seeks long-term capital appreciation; current income
is a secondary consideration.

Growth with Income Portfolio seeks a combination of capital appreciation and
current income.

Bond Portfolio seeks a high level of current income.

Managed Total Return Portfolio seeks high total return (capital appreciation and
current income).

Two classes of shares, the No-Load Class and the Financial Adviser Class (each a
"Class" and collectively the "Classes"), of the Aggressive Growth Portfolio,
Growth Portfolio, Growth with Income Portfolio and Bond Portfolio are offered
for sale. The Managed Total Return Portfolio offers only one Class of shares,
the Financial Adviser Class. The No-Load Class is offered for sale at net asset
value by Tucker Anthony Incorporated ("Tucker Anthony") and Sutro & Co.
Incorporated ("Sutro") to participants in the FundManager Advisory Program, and
the Financial Adviser Class is offered for sale at net asset value by Tucker
Anthony, Sutro, Edgewood Services, Inc. ("Edgewood") and Freedom Distributors
Corporation ("Freedom Distributors") (collectively, the "Distributors") as an
investment vehicle for individuals, institutions, corporations and fiduciaries.
The Financial Adviser Class pays a distribution fee in connection with the
distribution of its shares pursuant to a Distribution Plan. Prior to May 8,
1995, the Portfolios were a diversified series of the Republic Funds (the
"Predecessor Funds"), also an open-end, management investment company.

This Statement of Additional Information is not a prospectus and is only
authorized for distribution when preceded or accompanied by the applicable
Prospectus for the No-Load Class or Financial Adviser Class, each dated _______
(each a "Prospectus"). This Statement of Additional Information contains
additional and more detailed information than that set forth in each Prospectus
and should be read in conjunction with such Prospectus. You may request
additional copies of a Prospectus or a paper copy of this Statement of
Additional Information, if you have received it electronically, without charge
by writing or calling the Trust at the address and information number printed
above.

This Statement of Additional Information is dated ________.

<PAGE>

TABLE OF CONTENTS

<PAGE>

INVESTMENT POLICIES

Although the Portfolios invest primarily in the shares of other mutual funds,
they also are authorized to invest for temporary defensive purposes or as may be
considered necessary to accumulate cash for investments or to meet anticipated
redemptions in a variety of short-term debt securities, including U.S. Treasury
bills and other U.S. government securities, commercial paper, certificates of
deposit, bankers' acceptances and repurchase agreements with respect to such
securities. The following information supplements the discussion of the
investment objectives and policies of the Portfolios found under "Investment
Objectives" in the Prospectus.

U.S. Government Securities
The Portfolios may invest in obligations issued or guaranteed by the United
States government or its agencies or instrumentalities which have remaining
maturities not exceeding one year. The U.S. government securities in which the
Portfolios invest are either issued or guaranteed by the U.S. government, its
agencies or instrumentalities. The U.S. government securities in which the
Portfolios invest include, but are not limited to:

o DIRECT OBLIGATIONS OF THE U.S. TREASURY, SUCH AS U.S. TREASURY BILLS, NOTES
AND BONDS;

o NOTES, BONDS, AND DISCOUNT NOTES ISSUED OR GUARANTEED BY U.S. GOVERNMENT
AGENCIES AND INSTRUMENTALITIES SUPPORTED BY THE FULL FAITH AND CREDIT OF THE
UNITED STATES;

o NOTES, BONDS, AND DISCOUNT NOTES OF U.S. GOVERNMENT AGENCIES OR
INSTRUMENTALITIES WHICH RECEIVE OR HAVE ACCESS TO FEDERAL FUNDING; AND

o NOTES, BONDS, AND DISCOUNT NOTES OF OTHER U.S. GOVERNMENT INSTRUMENTALITIES
SUPPORTED ONLY BY THE CREDIT OF THE INSTRUMENTALITIES.

Bank Obligations The Portfolios may invest in obligations of U.S. banks
(including certificates of deposit and bankers' acceptances) having total assets
at the time of purchase in excess of $1 billion. Such banks shall be members of
the Federal Deposit Insurance Corporation.

A certificate of deposit is an interest-bearing negotiable certificate issued by
a bank against funds deposited in the bank. A bankers' acceptance is a
short-term draft drawn on a commercial bank by a borrower, usually in connection
with an international commercial transaction. Although the borrower is liable
for payment of the draft, the bank unconditionally guarantees to pay the draft
at its face value on the maturity date.

Commercial Paper
Commercial paper represents short-term unsecured promissory notes issued in
bearer form by bank holding companies, corporations and finance companies. The
commercial paper purchased by the Portfolios consists of direct obligations of
domestic issuers which, at the time of investment, are: (i) rated in the highest
commercial paper rating category by a nationally recognized statistical rating
organization ("NRSRO"), such as "P-1" by Moody's Investors Service, Inc.
("Moody's") or "A-1" or better by Standard & Poor's ("Standard & Poor's"); (ii)
issued or guaranteed as to principal and interest by issuers or guarantors
having an existing debt security rating of "Aa" or better by Moody's or "AA" or
better by Standard & Poor's or a similar high grade rating by another NRSRO; or
(iii) securities which, if not rated, are, in the opinion of Freedom Capital
Management Corporation, the Portfolios' investment adviser ("Freedom Capital
Management" or the "Adviser"), of an investment quality comparable to rated
commercial paper in which the Funds may invest.

The rating "P-1" is the highest commercial paper rating assigned by Moody's and
the ratings "A-1" and "A-1+" are the highest commercial paper ratings assigned
by Standard & Poor's. Debts rated "Aa" or better by Moody's or "AA" or better by
Standard & Poor's are generally regarded as high-grade obligations and such
ratings indicate that the ability to pay principal and interest is very strong.

Repurchase Agreements
The Portfolios may invest in securities subject to repurchase agreements with
banks or broker-dealers. A repurchase agreement is a transaction in which the
seller of a security commits itself at the time of the sale to repurchase that
security from the buyer at a mutually agreed upon time and price. The repurchase
price exceeds the sale price, reflecting an agreed upon interest rate effective
for the period the buyer owns the security subject to repurchase. The agreed
upon rate is unrelated to the interest rate on that security. The Adviser will
monitor the value of the underlying security at the time the transaction is
entered into and at all times during the term of the repurchase agreement to
insure that the value of the security always equals or exceeds the repurchase
price. In the event of default by the seller under the repurchase agreement, a
Portfolio may have problems in exercising its rights to the underlying
securities and may incur costs and experience time delays in connection with the
disposition of such securities. Repurchase agreements are considered to be loans
under the Investment Company Act of 1940 (the "1940 Act") collateralized by the
underlying securities.

INVESTMENT RESTRICTIONS

The following investment restrictions are in addition to those described under
"Investment Objectives" and "Investment Policies and Restrictions" in the
Prospectus. The following restrictions may not be changed with respect to a
Portfolio without the approval of the holders of a majority of that Portfolio's
outstanding securities. Except that a Portfolio may invest all of its investable
assets in an open-end investment company with substantially the same investment
policies and restrictions as the Portfolio, a Portfolio will not:

1. PURCHASE OR OTHERWISE ACQUIRE
INTERESTS IN REAL ESTATE, REAL
ESTATE MORTGAGE LOANS OR
INTERESTS IN OIL, GAS OR OTHER
MINERAL LEASES, AS WELL AS
EXPLORATION OR DEVELOPMENT
PROGRAMS, EXCEPT THAT A
PORTFOLIO MAY PURCHASE
SECURITIES ISSUED BY COMPANIES,
INCLUDING REAL ESTATE INVESTMENT
TRUSTS, WHICH INVEST IN REAL
ESTATE OR INTERESTS THEREIN.

2. MAKE LOANS, EXCEPT THAT A PORTFOLIO MAY PURCHASE AND HOLD PUBLICLY
DISTRIBUTED DEBT SECURITIES AND IT MAY ENTER INTO REPURCHASE AGREEMENTS.

3.
INVEST
IN
SECURITIES
OF
ANY
ISSUER
WHICH,
TOGETHER
WITH
ANY
PREDECESSOR,
HAS
BEEN
IN
OPERATION
FOR
LESS
THAN
THREE
YEARS
IF,
AS
A
RESULT,
MORE
THAN
5%
OF
THE
TOTAL
ASSETS
OF
THE
PORTFOLIO
WOULD
THEN
BE
INVESTED
IN
SUCH
SECURITIES.

4.
PURCHASE
THE
SECURITIES
OF
AN
ISSUER
IF,
TO
A
PORTFOLIO'S
KNOWLEDGE,
ONE
OR
MORE
OF
THE
TRUSTEES
OR
OFFICERS
OF
THE
TRUST
INDIVIDUALLY
OWNS
MORE
THAN
ONE
HALF
OF
1%
OF
THE
OUTSTANDING
SECURITIES
OF
SUCH
ISSUER
AND
TOGETHER
BENEFICIALLY
OWN
MORE
THAN
5%
OF
SUCH
SECURITIES.

5. SELL SECURITIES SHORT OR INVEST IN PUTS, CALLS, STRADDLES, SPREADS OR
COMBINATIONS THEREOF.

6. PURCHASE SECURITIES ON MARGIN, EXCEPT SUCH SHORT-TERM CREDITS AS ARE
NECESSARY FOR THE CLEARANCE OF TRANSACTIONS.

7. PURCHASE OR ACQUIRE COMMODITIES OR COMMODITY CONTRACTS.

8. ACT AS AN UNDERWRITER OF SECURITIES.

9. ISSUE SENIOR SECURITIES, EXCEPT INSOFAR AS A
PORTFOLIO MAY BE DEEMED TO HAVE ISSUED A SENIOR SECURITY IN CONNECTION WITH ANY
REPURCHASE AGREEMENT OR ANY PERMITTED BORROWING.

10. PURCHASE WARRANTS, VALUED AT THE LOWER OF COST OR MARKET, IN
EXCESS OF 10% OF THE VALUE OF A PORTFOLIO'S NET ASSETS. INCLUDED
WITHIN THAT AMOUNT, BUT NOT TO EXCEED 2% OF THE VALUE OF THE
PORTFOLIO'S NET ASSETS, MAY BE WARRANTS THAT ARE NOT LISTED ON THE
NEW YORK OR AMERICAN STOCK EXCHANGES OR AN EXCHANGE WITH
COMPARABLE LISTING REQUIREMENTS. WARRANTS ATTACHED TO SECURITIES
ARE NOT SUBJECT TO THIS LIMITATION.

In addition, as non-fundamental policies, a Portfolio will not: (i) invest
in securities for the purpose of exercising control over or management of the
issuer; (ii)invest more than 15% of the Funds' net assets (taken at the greater
of cost or market value) in Illiquid Securities (excluding 144A securities that
have been determined to be "liquid" under procedures established by the
Trustees); (iii) with respect to 75% of the Fund's total assets, purchase
securities of any issuer (other than U.S. government securities, cash, cash
items, and securities of other investment companies) if such purchase at the
time thereof would cause the Fund to hold more than 10% of any class of
securities of such issuer, for which purposes all indebtedness of an issuer
shall be deemed a single class and all preferred stock of an issuer shall be
deemed a single class, except that futures or option contracts shall not be
subject to this restriction. These additional policies may be changed as to a
Portfolio by the Board of Trustees (the "Trustees") without shareholder
approval.

The underlying funds in which a Portfolio invests may, but need not, have the
same investment policies as a Portfolio. Although all of the Portfolios may,
from time to time, invest in shares of the same underlying fund, the percentage
of each Portfolio's Fund's assets so invested may vary, and the Adviser will
determine that such investments are consistent with the investment objectives
and policies of each particular Portfolio.

MANAGEMENT

Trustees and Officers The principal occupations of the Trustees and executive
officers of the Trust for the past five years and their ages are listed below.
The address of each, unless otherwise indicated, is One Beacon Street, Boston,
Massachusetts 02108.

Dexter A. Dodge* (62), Trustee, Chairman and Chief Executive Officer, Chairman
of the Adviser since October 1994. Director of the Adviser since 1983. Vice
President of Freedom Distributors Corporation since 1989. Chairman of the Boards
and Chief Executive Officer of Freedom Mutual Fund and Freedom Group of Tax
Exempt Funds since July 1992.

Ernest T. Kendall (64), Trustee, 230 Beacon Street, Boston, Massachusetts 02116.
President, Commonwealth Research Group, Inc., Boston, Massachusetts, a
consulting firm specializing in microeconomics, regulatory economics and labor
economics, since 1978. Trustee of Freedom Mutual Fund and Freedom Group of Tax
Exempt Funds since September 1993.

John R. Haack (55), Trustee since December 16, 1996, 311 Commonwealth Avenue,
#81, Boston, Massachusetts 02115. Superintendent, Suffolk County House of
Correction, Boston, Massachusetts, 1996 to present. Vice President of
Operations, Reliable Transaction Processing, 1995 to 1996. Major General,
Assistant to the Commander in Chief, U.S. Space Command and Commander in Chief,
North American Aerospace Command, 1993 to 1995. General Manager, Unilect
Industries, , 1993 to 1994. Brigadier General, Commander of 102nd Fighter Wing,
1986 to 1993.

Richard B. Osterberg (53), Trustee, 84 State Street, Boston, Massachusetts
02109. Member of the law firm of Weston, Patrick, Willard & Redding, Boston,
Massachusetts,since 1969. Trustee of Freedom Mutual Fund and Freedom Group of
Tax Exempt Funds since September 1993.

Charles B. Lipson (51), President and Principal Executive Officer, One Beacon
Street, Boston, Massachusetts 02108. President and founding partner of the M.D.
Hirsch Division of Freedom Capital since January 1995. President and Chief
Operating Officer of the M.D. Hirsch Division of Republic Asset Management
Corporation from February 1991 to December 1994. Senior Vice President and Chief
Operating Officer of Home Capital Services, Inc. prior to February 1991.

John J. Danello (41), Executive Vice President. President, Chief Operating
Officer and Secretary of the Adviser since October 1994. Vice President-Managing
Director, Clerk and General Counsel of the Adviser from November 1986 to October
1994. President and Director since February 1989 and Clerk since February 1987
of Freedom Distributors Corporation. President and Secretary of Freedom Mutual
Fund and Freedom Group of Tax Exempt Funds since July 1992.

Michael D. Hirsch (51), Executive Vice President and Portfolio Manager,
Chairman, M.D. Hirsch Division of the Adviser since February 1995. Vice Chairman
and Managing Director, M.D. Hirsch Division of Republic Asset Management
Corporation from June 1993 to February 1994. President M.D. Hirsch Investment
Management, Inc. from February 1991 to June 1993. Chief Investment Officer,
Republic National Bank of New York prior to February 1991.

Victor R. Siclari (35), Secretary, Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779. Vice President and Corporate Counsel, Federated
Administrative Services since 1992; Associate of Morrison & Foerster, a law
firm, from 1990 to 1992.

Judith J. Mackin (36), Treasurer, Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779. Assistant Vice President and Director of the Client
Management and Services Group of Federated Administrative Services.

Edward C. Gonzales (66), Executive Vice President, Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779. Vice Chairman, Treasurer, and Trustee,
Federated Investors; Vice President, Federated Advisers, Federated Management,
Federated Research, Federated Research Corp., Federated Global Research Corp.
and Passport Research, Ltd.; Executive Vice President and Director, Federated
Securities Corp.; Trustee, Federated Shareholder Services Company; Chairman,
Treasurer, and Trustee, Federated Administrative Services.

Ronald M. Petnuch (36), Executive Vice President, Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779. Vice President and Director of the Client
Management and Services Group of Federated Administrative Services.

* Trustee may be deemed to be an "interested person" of the Trust as defined by
the 1940 Act.

Mr. Danello is also an officer of certain other investment companies for which
the Adviser or an affiliate is the investment adviser. Messrs. Gonzales,
Petnuch, Siclari and Ms. Mackin are also directors, trustees and/or officers of
certain other investment companies for which Federated Investors or its
subsidiaries serve as investment adviser, administrator and/or principal
underwriter.

Trustees' Compensation
<TABLE>
<CAPTION>

<S> <C> <C>
Name, Aggregate Compensation Total Compensation Paid
Position with Trust from Trust*# from Trust and Freedom Complex **
Dexter A. Dodge $_ for the Trust and
Trustee $ _ _ other investment companies in the Freedom Complex

Ernest T. Kendall $__$__ for the Trust and
Trustee _ other investment companies in the Freedom Complex

John R. Haack++ $_ for the Trust and
Trustee $ _ _ other investment companies in the Freedom Complex

Richard B. Osterberg $__$__ for the Trust and
Trustee _ other investment companies in the Freedom Complex

</TABLE>

* Information is furnished for the fiscal year ended September 30, 1997.

* Freedom Complex refers to both Freedom Mutual Fund and Freedom Group of Tax
Exempt Funds.

# The aggregate compensation is provided for the Trust which is comprised of 5
Portfolios.

The information is provided for the last fiscal year.

++ Mr. Haack became a Trustee on December 16, 1996.

<PAGE>

Trustees who are not interested persons of the Trust receive an annual retainer
of $3,600 and a fee of $600 for each meeting of the Trustees or committee
thereof attended. The chairperson of each of the Audit and Contracts Committee
receives an additional fee per annum of $600. Mr. Kendall serves as chairperson
of the Audit Committee and Mr. Osterberg serves as chairperson of the Contracts
Committee. Interested persons of the Trust who serve as Trustee receive no fees
from the Trust. All Trustees of the Trust are reimbursed for expenses for
attendance at meetings. The Trust has no bonus, profit sharing, pension or
retirement plans. For the fiscal year ended September 30, 1997, the Trust paid
$___ in Trustee fees and expenses.

The Trustees of the Trust have two committees, an Audit Committee and a
Contracts Committee. The Audit Committee assists the Board in fulfilling its
duties relating to accounting and financial reporting practices and serves as a
direct line of communication between the Board and the independent auditors. The
Audit Committee is responsible for recommending the engagement or retention of
the independent accountants, reviewing with the independent accountants the plan
and the results of the auditing engagement, approving professional services
provided by the independent accountants prior to the performance of such
services, considering the range of audit and non-audit fees, reviewing the
independence of the independent auditors, reviewing the scope and results of
procedures for internal auditing, and reviewing the system of internal
accounting control.

The function of the Contracts Committee is to assist the Board in fulfilling its
duties with respect to the review and approval of contracts between the Trust,
on behalf of the Portfolios, and other entities, including entering into new
contracts and the renewal of existing contracts. The Contracts Committee
considers investment advisory, distribution, transfer agency, administrative
service and custodial contracts and such other contracts as the Board deems
necessary or appropriate for the continuation of operations of the Portfolios or
the Trust. The Contracts Committee will also be responsible for the selection
and nomination of Trustees who are not "interested persons" within the meaning
of the 1940 Act of the Trust.

All of the Trustees who are not "interested persons" within the meaning of the
1940 Act of the Trust currently serve on the Audit and Contracts Committees.

As of ____, 1997, the Trustees and Officers of the Trust, as a group, owned less
than 1% of the outstanding shares of each Portfolio. As of the same date, the
following persons owned of record, or beneficially owned, 5% or more of the
outstanding shares of the Portfolios (percentage is percentage of outstanding
shares of a Portfolio owned by the shareholder):

The Trust's Master Trust Agreement provides that it will indemnify its Trustees
and officers against liabilities and expenses incurred in connection with
litigation in which they may be involved because of their offices with the
Trust, unless, as to liability to the Trust or its shareholders, it is finally
adjudicated that they engaged in wilful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in their offices, or unless with
respect to any other matter it is finally adjudicated that they did not act in
good faith in the reasonable belief that their actions were in the best
interests of the Trust. In the case of settlement, such indemnification will not
be provided unless it has been determined by a court or other body approving the
settlement or other disposition, or by a reasonable determination, based upon a
review of readily available facts, by vote of a majority of disinterested
Trustees or in a written opinion of independent counsel, that such officers or
Trustees have not engaged in wilful misfeasance, bad faith, gross negligence or
reckless disregard of their duties.

Investment Adviser
Pursuant to an Investment Advisory Contract, Freedom Capital Management is
responsible for the investment management of each Portfolio's assets, including
the responsibility for making investment decisions and placing orders for the
purchase and sale of each Portfolio's investments directly with the issuers or
with brokers or dealers selected by it in its discretion, including Freedom
Distributors and Edgewood. See "Portfolio Transactions." The Adviser also
furnishes to the Trustees, which have overall responsibility for the business
and affairs of the Trust, periodic reports on the investment performance of the
Portfolios. The Adviser is a registered investment advisory firm which maintains
a large securities research department, the efforts of which will be made
available to the Portfolios.

Thomas H. Lee Equity Fund III, L.P. is Massachusetts limited partnership. The
general partner of Thomas H. Lee Equity Fund III, L.P. is THL Equity Advisors
III Limited Partnership, a Massachusetts limited partnership. The general
partner of THL Equity Advisors III Limited Partnership is THL Equity Trust III,
a Massachusetts business trust. The sole beneficial owner of THL Equity Trust
III is Thomas H. Lee. The address of Thomas H. Lee Equity Fund III, L.P., THL
Equity Advisors III Limited Partnership and THL Equity Trust III is 75 State
Street, Boston, Massachusetts 02109.

SCP Private Equity Partners, L.P. is a Delaware limited partnership. The general
partner of SCP Private Equity Partners, L.P. is SCP Private Equity Management,
L.P., a Delaware limited partnership. The interests of SCP Private Equity
Management, L.P. are divided equally among its three general partners: Safeguard
Capital Management, Inc. (which is a wholly owned subsidiary of Safeguard
Scientifics, Inc., a publicly held company), Winston J. Churchill and Samuel A.
Plum. The address of SCP Private Equity Partners, L.P., SCP Private Equity
Management, L.P., Safeguard Capital Management, Inc., Winston J. Churchill and
Samuel A. Plum is 435 Devon Park Drive, Wayne, Pennsylvania 19087.

For a more complete description of the Adviser see "Management of FundManager
Portfolios--The Adviser" in your Prospectus.

The investment advisory services of the Adviser to the Portfolios are not
exclusive under the terms of the Investment Advisory Contract. The Adviser is
free to render investment advisory services to others.

For its services as investment adviser, the Adviser receives from each Portfolio
a fee, payable monthly, at the annual rate of 0.50% of each Portfolio's average
daily net assets up to $500 million and 0.40% of its average daily net assets in
excess of $500 million. M.D. Hirsch Investment Management, Inc. ("Hirsch")
served as investment adviser to the Predecessor Funds from the period October 1,
1992 through August 30, 1993, at which time Republic Asset Management
Corporation became investment adviser to the Predecessor Funds.

Republic Asset Management Corporation served as investment adviser to the
Predecessor Funds until February 20, 1995, at which time Freedom Capital
Management became investment adviser to the Predecessor Funds. For the period
from October 1, 1994 through February 20, 1995, Aggressive Growth Portfolio,
Growth Portfolio, Growth with Income Portfolio, Bond Portfolio and Managed Total
Return Portfolio paid advisory fees before reimbursements of $74,692, $66,712,
$99,675, $151,276 and $32,185, respectively to Republic Asset Management
Corporation. For the period from February 21, 1995 through September 30, 1995,
Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio,
Bond Portfolio and Managed Total Return Portfolio paid advisory fees of
$109,055, $89,497, $130,491, $216,909 and $44,931, respectively, to Freedom
Capital Management. For the period from October 1, 1995 through September 30,
1996, Aggressive Growth Portfolio, Growth Portfolio, Growth with Income
Portfolio, Bond Portfolio and Managed Total Return Portfolio paid advisory fees
before reimbursements of $183,337, $132,472, $167,996, $367,138 and $67,171,
respectively, to the Adviser. For the period from October 1, 1996 through
September 30, 1997, Aggressive Growth Portfolio, Growth Portfolio, Growth with
Income Portfolio, Bond Portfolio and Managed Total Return Portfolio paid
advisory fees before reimbursements of $____, $____, $____, $____, and $____,
respectively, to the Adviser. The Investment Advisory Contract will continue in
effect from year to year provided such continuance is approved annually (i) by
the holders of a majority of the outstanding voting securities of a Portfolio or
by the Trustees and (ii) by a majority of the Trustees who are not parties to
such Contract or "interested persons" (as defined in the 1940 Act) of any such
party. The Contract may be terminated with respect to a Portfolio on 60 days'
written notice by either party to the Contract and will terminate automatically
if assigned.

Mr. Osterberg, a Trustee of the Trust, is a member of the law firm of Weston,
Patrick, Willard & Redding, which has retained the Adviser from time to time to
provide investment advisory consulting services for clients of such firm.

Administrator
The Trustees of the Trust have approved an Administrative Services Contract
between the Trust and Federated Administrative Services ("FAS") (effective
November 11, 1996) pursuant to which FAS replaced Signature Broker-Dealer
Services, Inc. ("Signature") as Administrator of the Trust and each Class of
shares of each of the Portfolios. In this capacity, FAS will provide certain
administrative and personnel services to the Portfolios for a fee as described
in the Prospectus.

The administrative and personnel services necessary for the operation of the
Trust provided by the Administrator include among other things: (i) preparation
of shareholder reports and communications; (ii) regulatory compliance, such as
reports to and filings with the Securities and Exchange Commission ("SEC") and
state securities commissions; and (iii) general supervision of the operation of
the Trust, including coordination of the services performed by the Trust's
investment adviser, transfer agent, custodian, independent auditors, legal
counsel and others. In addition, the Administrator furnishes office space and
facilities required for conducting the business of the Trust and pays the
compensation of the Trust's officers, employees and Trustees (if any) affiliated
with the Administrator.

For the period from October 1, 1994 through September 30, 1995, Signature (the
former Administrator) received $91,873, $78,104, $115,086, $172,206 and $38,540,
respectively, from Aggressive Growth Portfolio, Growth Portfolio, Growth with
Income Portfolio, Bond Portfolio and Managed Total Return Portfolio. For the
period from October 1, 1995 through September 30, 1996, Signature received
$91,669, $66,236, $83,998, $171,868 and $33,586, respectively, from Aggressive
Growth Portfolio, Growth Portfolio, Growth with Income Portfolio, Bond Portfolio
and Managed Total Return Portfolio, of which $22,675, $14,995, $19,270, $37,200
and $7,522, respectively, was waived. For the period from October 1, 1996
through November 11, 1996, Signature received $___, $___ of which was waived.
For the period from November 11, 1996 through September 30, 1997, FAS received
$___, $___of which was waived.

Distributors
The Trustees of the Trust have approved a Distribution Contract between the
Trust and the Distributors, pursuant to which such Distributors provide
shareholder servicing services and/or distribute the Financial Adviser Class of
shares of each of the Portfolios. The Trustees of the Trust has also approved a
Distribution Contract between the Trust and each of Tucker Anthony and Sutro
pursuant to which such distributors provide shareholder servicing services and
distribute the No-Load Class of shares of each of the Aggressive Growth
Portfolio, Growth Portfolio, Growth with Income Portfolio and Bond Portfolio.

The Distributors are not obligated to sell any specific amount of shares. Under
a Distribution Plan (the "Plan") adopted by the Financial Adviser Class of the
Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio,
Bond Portfolio and Managed Total Return Portfolio, each such Portfolio may
reimburse the distributors monthly (subject to a limit of 0.50% per annum of the
Portfolio's average daily net assets attributable to the Financial Adviser
Class) for the sum of (a) direct costs and expenses incurred by the Distributors
in connection with advertising and marketing of the Financial Adviser Class of
shares and (b) payment of fees to one or more broker-dealers or other
organizations (other than banks) for services rendered in the distribution of
the Financial Adviser Class of shares and for the provision of personal services
and account maintenance services with respect to Portfolio shareholders,
including payments in amounts based on the average daily value of Portfolio
shares owned by shareholders in respect of which the broker-dealer or
organization has a relationship. The fees and reimbursements paid by a Portfolio
to the Distributors may equal up to 0.50% of the Portfolio's average daily net
assets attributable to the Financial Adviser Class of shares, of which up to
0.25% of a Portfolio's average daily net assets attributable to the Financial
Adviser Class may be paid for shareholder servicing expenses. Any payment by a
Distributor or reimbursement of a Distributor by a Portfolio made pursuant to
the Plan is contingent upon Trustees' approval. A report of the amounts expended
pursuant to the Plan, and the purposes for which such expenditures were
incurred, must be made to the Trustees for their review at least quarterly.

The Plan permits, among other things, payment by the Portfolios of the costs of
preparing, printing and distributing prospectuses and of implementing and
operating the Plan. The Plan also permits the distributors to receive and retain
brokerage commissions with respect to portfolio transactions for mutual funds in
the Portfolios' portfolios, including funds which have a policy of considering
sales of their shares in selecting broker-dealers for the execution of their
portfolio transactions. In addition, Freedom Distributors and Edgewood may
receive dealer reallowances (up to a maximum of 1% of the public offering price
with respect to Freedom Distributors) and/or distribution payments, shareholder
servicing fees or "trailer fees" from the underlying mutual funds purchased by
the Portfolios.

The Plan provides that it may not be amended to increase materially the costs
which a Portfolio may bear pursuant to the Plan without shareholder approval and
that other material amendments of the Plan must be approved by the Board of
Trustees, and by the Trustees who are neither "interested persons" (as defined
in the 1940 Act) of the Trust nor have any direct or indirect financial interest
in the operation of the Plan or in any related agreement, by vote cast in person
at a meeting called for the purpose of considering such amendments. While the
Plan is in effect, the selection and nomination of the Trustees of the Trust has
been committed to the discretion of the Trustees who are not "interested
persons" of the Trust. The Plan has been approved, and is subject to annual
approval, by the Board of Trustees and by the Trustees who are neither
"interested persons" nor have any direct or indirect financial interest in the
operation of the Plan, by vote cast in person at a meeting called for the
purpose of voting on the Plan. The Trustees considered alternative methods to
distribute the Financial Adviser Class of shares of the Portfolios and to reduce
the Financial Adviser Class' per share expense ratios and concluded that there
was a reasonable likelihood that the Plan will benefit the Class and its
shareholders. The Plan is terminable with respect to the Financial Adviser Class
or a Portfolio at any time by a vote of a majority of the Trustees who are not
"interested persons" of the Trust and who have no direct or indirect financial
interest in the operation of the Plan or by vote of the holders of a majority of
the shares of that Portfolio or Class.

During the fiscal year ended September 30, 1997, the Portfolios spent, pursuant
to their 12b-1 plans on behalf of the Financial Adviser Class, the following
amounts on: [TO BE FILED BY AMENDMENT]

Managed
Aggressive Growth with Total
Growth Growth Income Bond Return
Portfolio Portfolio Portfolio Portfolio Portfolio
Advertising, Printing and mailing of

prospectuses to other than current

shareholder

Compensation to broker-dealers

Total

Total as a percentage of average daily

net assets during period

<PAGE>

The Portfolios will not invest in any fund which may be affiliated with the
Distributors or any of their affiliates unless otherwise permitted under the
1940 Act.

Service Organizations
Pursuant to the Plan, the Trust also contracts with banks, trust companies,
broker-dealers (other than the Distributors) or other financial organizations
("Service Organizations") to provide certain administrative services for each
Portfolio's Financial Adviser Class of shares. Services provided by service
organizations may include, among other things, providing necessary personnel and
facilities to establish and maintain certain shareholder accounts and records;
assisting in processing purchase and redemption transactions; arranging for the
wiring of funds; transmitting and receiving funds in connection with client
orders to purchase or redeem shares; verifying and guaranteeing client
signatures in connection with redemption orders, transfers among and changes in
client-designated accounts; providing periodic statements showing a client's
account balances and, to the extent practicable, integrating such information
with other client transactions; furnishing periodic and annual statements and
confirmations of all purchases and redemptions of shares in a client's account;
transmitting proxy statements, annual reports, and updating prospectuses and
other communications from the trust to clients; and such other services as the
trust or a client reasonably may request, to the extent permitted by applicable
statute, rule or regulation. The Distributors and the Adviser will not be
service organizations or receive fees for servicing.

FundManager Advisory Program
Shares of the No-Load Class of shares will be offered to participants in the
FundManager Advisory Program who receive, for an advisory fee at a maximum
annual rate based upon a percentage of assets invested, certain services,
including asset allocation recommendations with respect to the funds based on an
evaluation of their investment objectives and risk tolerances.

<PAGE>

PORTFOLIO TRANSACTIONS

As part of its obligations under the investment advisory contract, the Adviser
places all orders for the purchase and sale of portfolio investments for the
Portfolios' accounts with brokers or dealers selected by it in its discretion,
including Freedom Distributors or Edgewood. In selecting a broker, the Adviser
considers a number of factors including the research and other investment
information provided by the broker.

The following is the sales charges paid on underlying fund investments.

Sales Charges Paid By Portfolios

For Fiscal Year Ended September 30, 1995
Sales Charges
Gross Sales Paid to Percent of
ChargesSignature Total
Aggressive Growth Portfolio 2,000 $1,500 75.00%

Growth Portfolio 150 135 90.00%

Growth with Income Portfolio 0 0 N/A

Bond Portfolio 0 0 N/A

Managed Total Return Portfolio 0 0 N/A

Total sales charges and total dollar amount of transactions on which sales
charges were paid during the fiscal year ended September 30, 1995, were $2,150
and $230,000, respectively, of which Signature received 76.05%. As of September
30, 1995, the Funds' shares have not been divided into classes.

Sales Charges Paid By Portfolios

For Fiscal Year Ended September 30, 1996
Sales Charges
Gross Sales Paid to Percent of
Charges Signature Total
Aggressive Growth Portfolio $0 $0 N/A

Growth Portfolio 0 0 N/A

Growth with Income Portfolio 0 0 N/A

Bond Portfolio 0 0 N/A

Managed Total Return Portfolio 0 0 N/A

Total sales charges and total dollar amount of transactions on which sales
charges were paid during the fiscal year ended September 30, 1996, were $0 and
$0, respectively.

Sales Charges Paid by Portfolios

For Fiscal Year Ended September 30, 1997:

[TO BE FILED BY AMENDMENT]

<PAGE>

OTHER INFORMATION

Capitalization

FundManager Portfolios (formerly named FundManager Trust) is a Delaware business
trust established under a Master Trust Agreement dated February 7, 1995. Prior
to May 8, 1995, the Portfolios were series of the Republic Funds (formerly
FundTrust), a Massachusetts business trust (organized April 22, 1987). Republic
Funds was a successor to two previously-existing Massachusetts business trusts,
FundTrust Tax-Free Trust (organized on July 30, 1986) and FundVest (organized on
July 17, 1984, and since renamed Fund Source). The Trust currently consists of
five separately managed portfolios - Aggressive Growth Portfolio (formerly,
Aggressive Growth Fund), Growth Portfolio (formerly, Growth Fund), Growth with
Income Portfolio (formerly, Growth & Income Fund), Bond Portfolio (formerly,
Bond Fund, and before that, Income Fund), and Managed Total Return Portfolio
(formerly, Managed Total Return Fund) - each offering two classes of shares of
beneficial interest (except Managed Total Return Portfolio, which only offers a
Financial Advisers Class). The capitalization of the Trust consists solely of an
unlimited number of shares of beneficial interest with a par value of $0.001
each. The Trustees may establish additional series (with different investment
objectives and fundamental policies) and additional classes of shares at any
time in the future. Establishment and offering of additional series and classes
will not alter the rights of the Trust's shareholders. When issued, shares are
fully paid, nonassessable, redeemable and freely transferable. Shares do not
have preemptive rights or subscription rights. In liquidation of a Portfolio,
each shareholder is entitled to receive his pro rata share of the net assets of
that Portfolio.

Voting Rights
Under the Master Trust Agreement, the Trust is not required to hold annual
meetings to elect Trustees or for other purposes. It is not anticipated that the
Trust will hold shareholders' meetings unless required by law or the Master
Trust Agreement provides that the holders of not less than two thirds of the
outstanding shares of the Trust may remove persons serving as Trustee either by
declaration in writing or at a meeting called for such purpose. The Trustees are
required to call a meeting for the purpose of considering the removal of persons
serving as Trustee if requested in writing to do so by the holders of not less
than 10% of the outstanding shares of the Trust.

Performance Information
The Trust may, from time to time, include quotations of the Portfolios' yield
and average annual total return in advertisements or reports to shareholders or
prospective investors.

Quotations of yield will be based on a Portfolio's investment income per share
earned during a particular 30-day period, less expenses accrued during the
period ("net investment income") and will be computed by dividing net investment
income by the maximum offering price per share on the last day of the period,
according to the following formula:

YIELD = 2[(A cdB + 1)6-1]

(where a = dividends and interest earned during the period, b = expenses accrued
for the period (net of any reimbursements), c = the average daily number of
shares outstanding during the period that were entitled to receive dividends and
d = the maximum offering price per share on the last day of the period).

For the 30-day period ending September 30, 1997, the yields for the Bond
Portfolio's Financial Adviser Class and No-Load Class were __% and __%,
respectively.

Quotations of a Portfolio's average annual total return will be expressed in
terms of the average annual compounded rate of return of a hypothetical
investment in such Portfolio over periods of 1, 5 and 10 years (up to the life
of the Portfolio), calculated pursuant to the following formula:

P (1 + T)n = ERV

(where P = a hypothetical initial payment of $1,000, T = the average annual
total return, n = the number of years and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period). All total
return figures will reflect the deduction of Portfolio expenses on an annual
basis and will assume that all dividends and distributions are reinvested when
paid.

For the period prior to its establishment, each Class of shares of each
Portfolio will adopt the performance of the Portfolios and their predecessors.
The performance for this period will reflect the deduction of the Class's
charges and expenses.

The total returns for the Financial Adviser Class Portfolios for the periods
ended September 30, 1997 were as follows:

<PAGE>

1 Year 5-Year 10-Year
Total Total Return Total Return
Return(Average Annual)(Average Annual)
Aggressive Growth Portfolio

Growth Portfolio

Growth with Income Portfolio

Bond Portfolio

Managed Total Return Portfolio

*Total return from commencement of operations August 4, 1988.

The total returns for the No-Load Class Portfolios for the period ended
September 30, 1997 were as follows:

1 Year Since Inception**
Total Total Return
Return (Average Annual)
Aggressive Growth Portfolio

Growth Portfolio

Growth with Income Portfolio

Bond Portfolio

** Total return from commencement of operations (October 1, 1995)

Quotations of yield and total return will reflect only the performance of a
hypothetical investment in a Portfolio during the particular time period shown.
Yield and total return for a Portfolio will vary based on changes in market
conditions and the level of such Portfolio's expenses, and no reported
performance figure should be considered an indication of performance which may
be expected in the future.

In connection with communicating its performance to current or prospective
shareholders, the Portfolios also may compare these figures to the performance
of other mutual funds tracked by mutual fund rating services or to unmanaged
indices which may assume reinvestment of dividends but generally do not reflect
deductions for administrative and management costs. Evaluations of the
Portfolios'performance made by independent sources may also be used in
advertisements concerning the Portfolios. Sources for the Portfolios'
performance information could include the following:

Barron's, a Dow Jones and Company, Inc. business and financial weekly that
periodically reviews mutual fund performance data.

Bottom Line, a bi-weekly newsletter which periodically reviews mutual funds and
interviews their portfolio managers.

Business Week, a national business weekly that periodically reports the
performance rankings and ratings of a variety of mutual funds investing abroad.

Changing Times, THE KIPLINGER MAGAZINE, a monthly investment advisory
publication that periodically features the performance of a variety of
securities.

CNBC, a cable financial news television station which periodically reviews
mutual funds and interviews portfolio managers.

Consumer Digest, a monthly business/financial magazine that includes a "money
watch" section featuring financial news.

Forbes, a national business publication that from time to time reports the
performance of specific investment companies in the mutual fund industry.

Fortune, a national business publication that periodically rates the performance
of a variety of mutual funds.

Lipper Analytical Services, Inc.'s Mutual Fund Performance Analysis, a weekly
publication of industry-wide mutual fund averages by type of fund.

Money, a monthly magazine that from time to time features both specific funds
and the mutual fund industry as a whole.

Morningstar, Inc., a publisher of financial information and mutual fund
research.

Mutual Funds Magazine, a magazine for the mutual fund investor which frequently
reviews and ranks mutual funds and interviews their portfolio managers.

New York Times, a nationally distributed newspaper which regularly covers
financial news.

Personal Investing News, a monthly news publication that often reports on
investment opportunities and market conditions.

Personal Investor, a monthly investment advisory publication that includes a
"mutual funds outlook" section reporting on mutual fund performance measures,
yields, indices and portfolio holdings.

Success, a monthly magazine targeted to the world of entrepreneurs and growing
business, often featuring mutual fund performance data.

U.S. News and World Report, a national business weekly that periodically reports
mutual fund performance data.

Value Line, a bi-weekly publication that reports on the largest 15,000 mutual
funds.

Wall Street Journal, a Dow Jones and Company, Inc. newspaper which regularly
covers financial news.

Weisenberger Investment Companies Services, an annual compendium of information
about mutual funds and other investment companies, including comparative data on
funds' backgrounds, management policies, salient features, management results,
income and dividend records, and price ranges.

Worth Magazine, a monthly magazine for the individual investor which frequently
reviews and ranks mutual funds and interviews their portfolio managers.

In addition, the Trust may also provide in its communications to current or
prospective shareholders a listing of those open-end investment companies and
mutual fund complexes or the respective funds included in the Portfolios'
portfolio holdings. These may include, but are not limited to, the following:

Fund Complexes--The AIM Family of Funds; The American Funds Group; Dodge & Cox
Investment Managers; Fidelity Investment; First Pacific Advisors, Inc.; Franklin
Custodian Funds, Inc.; Franklin Templeton Group; Friess Associates, Inc.; The
Gabelli Funds; Guardian Investor Services Corporation; Harbor Capital Advisors,
Inc.; Harris Associates, L.P.; Hotchkis & Wiley Funds; IDS Management; Lord
Abbett Family of Funds; Massachusetts Financial Services Company; Miller
Anderson & Sherrerd, LLP; MJ Whitman, Inc.; Mutual Series Fund, Inc.; Neuberger
& Berman Management Inc.; Pacific Financial Research; Pacific Investment
Management Company; Pioneer Funds Distributor; Putnam Funds; The Royce Funds;
Sanford C. Bernstein & Co., Inc.; Socie'te Ge'ne'rale Asset Management Corp.; T.
Rowe Price Associates, Inc.; The Vanguard Family of Funds; Venture Advisors,
L.P.; Waddell & Reed Asset Management Company; Yacktman Asset Management.

Investors who purchase and redeem Financial Adviser Class shares of the
Portfolios through a customer account maintained at a service organization may
be charged one or more of the following types of fees as agreed upon by the
Service Organization and the investor, with respect to the customer services
provided by the service organization: account fees (a fixed amount per month or
per year); transaction fees (a fixed amount per transaction processed);
compensating balance requirements (a minimum dollar amount a customer must
maintain in order to obtain the services offered); or account maintenance fees
(a periodic charge based upon a percentage of the assets in the account or of
the dividends paid on those assets). Such fees will have the effect of reducing
the yield and effective yield of the Portfolio for those investors. Investors
who maintain accounts with the Trust as transfer agent will not pay these fees.

Independent Auditors
Ernst & Young LLP serves as the independent auditors for the Trust and served as
the independent auditors for the Predecessor Portfolios since October 1, 1991.
Ernst & Young LLP audits the Portfolios' financial statements, prepares the
Portfolios' tax return and assists in filings with the SEC. Ernst & Young LLP's
address is 200 Clarendon Street, Boston, MA 02116. The financial statements for
the Portfolios for each of the five years in the period ended September 30,
1997, were audited by Ernst & Young LLP who have expressed an unqualified
opinion on those financial statements.

Counsel
Goodwin, Procter & Hoar, Exchange Place, Boston, Massachusetts 02109, passes
upon certain legal matters in connection with the shares offered by the Trust
and also acts as counsel to the Trust.

REGISTRATION STATEMENT

The Prospectuses and Statement of Additional Information do not contain all the
information included in the Trust's registration statement filed with the SEC
under the 1933 Act with respect to the securities offered hereby, certain
portions of which have been omitted pursuant to the rules and regulations of the
SEC. The registration statement, including the exhibits filed therewith, may be
examined at the office of the SEC in Washington, D.C.

Statements contained in the Prospectuses and Statement of Additional Information
as to the contents of any contract or other documents referred to are not
necessarily complete, and, in each instance, reference is made to the copy of
such contract or other documents filed as an exhibit to the registration
statement, each such statement being qualified in all respects by such
reference.

FINANCIAL STATEMENTS

The Portfolios' current reports to shareholders as filed with the SEC pursuant
to Section 30(b) of the 1940 Act and Rule 30b2-1 thereunder are hereby
incorporated herein by reference to the Trust's Annual Report dated September
30, 1997 (File Nos. 33-62103 and 811-7347). A copy of each such report will be
provided without charge to each person receiving this Statement of Additional
Information.

G01966-03 (11/97)

FundManager Portfolios--No-Load Class
(formerly, FundManager Trust)
One Beacon Street, Boston, Massachusetts 02108
General Information: (800) 344-9033 (Toll Free)

FundManager Portfolios (the "Trust") is an open-end management investment
company consisting of five separate diversified series with different investment
objectives. This Prospectus describes four diversified series (individually and
collectively referred to as "Portfolio" or "Portfolios," as the context
requires) of the Trust. Each Portfolio offers two classes of shares. The shares
offered by this Prospectus are the No-Load Class (the "Class") of shares
("Shares"). The Portfolios seek to achieve their objectives by investing in
shares of other open-end investment companies commonly called mutual funds. This
policy involves certain expenses in addition to those applicable to direct
investment in mutual funds. See "Risks and Other Considerations--Expenses." The
M.D. Hirsch Division of Freedom Capital Management Corporation ("Freedom Capital
Management" or the "Adviser") continuously manages each Portfolio's investment
portfolio.

Aggressive Growth Portfolio seeks capital appreciation without regard to current
income.

Growth Portfolio primarily seeks long-term capital appreciation. Current income
is a secondary consideration.

Growth with Income Portfolio seeks a combination of capital appreciation and
current income.

Bond Portfolio seeks a high level of current income.

Shares of the Portfolios are only offered for sale at net asset value by Tucker
Anthony Incorporated ("Tucker Anthony") and Sutro & Co. Incorporated
("Sutro")(collectively, the "Distributors") to participants in the FundManager
Advisory Program (the "Program"). In addition to Tucker Anthony and Sutro,
Freedom Distributors Corporation ("Freedom Distributors") and Edgewood Services,
Inc. ("Edgewood") serve as co-distributors for the Portfolios. The Program is an
investment advisory service that directly provides to investors asset allocation
recommendations with respect to the Portfolios based on an evaluation of an
investor's investment objectives and risk tolerances. See "Purchase of Shares."
In addition, the Portfolios may invest in shares of mutual funds which charge
sales loads and/or pay their own distribution expenses.

This
Prospectus should be read and retained for information about the Portfolios.

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

THE DATE OF THIS PROSPECTUS IS _______.

<PAGE>

TABLE OF CONTENTS [TO BE UPDATED]

Highlights 1
Portfolio Expenses 3
Financial Highlights 4
FundManager Portfolios 7
Investment Objectives 7
Investments of and Investment
Techniques Employed by Mutual Funds in
which the Portfolios May Invest 10
Derivatives 13
Investment Policies and Restrictions 15
Risks and Other Considerations 16
Expenses 17
Management of FundManager Portfolios 18
The Adviser 18
The Administrator 19
The Distributors 19
Custodian and Transfer Agent 19
Other Expenses 19
Portfolio Transactions 20
Determination of Net Asset Value 20
Purchase of Shares 21
Purchases by Clients of the Distributors
or Authorized Securities Dealers 21
FundManager Advisory Program 22
Redemption of Shares 22
Redemption of Shares Purchased
Through a Distributor 22
Direct Redemption 22
Dividends, Distributions and Taxes 23
Other Information 25
Other Classes of Shares 26
Shareholder Inquiries 26
Description of Bond Ratings 26

<PAGE>

HIGHLIGHTS

FUNDMANAGER PORTFOLIOS Page 7

Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio and
Bond Portfolio are series of the Trust, a Delaware business trust. Each
Portfolio seeks to achieve its investment objective by investing in mutual funds
registered with the SEC.

INVESTMENT OBJECTIVES Page 7

Each Portfolio has distinct investment objectives. Aggressive Growth Portfolio
seeks capital appreciation without regard to current income. Growth Portfolio
primarily seeks capital appreciation with current income a secondary
consideration. Growth with Income Portfolio seeks a combination of capital
appreciation and current income. Bond Portfolio seeks a high level of current
income. The mutual funds in which the Portfolios invest may invest in securities
which entail certain risks. These risks are described in "Investments of and
Investment Techniques Employed by Mutual Funds in Which the Portfolios May
Invest."

RISKS AND OTHER CONSIDERATIONS Page 16
Investing in a Portfolio that consists of an underlying portfolio of mutual
funds involves certain additional expenses and certain tax results which would
not be present in a direct investment in mutual funds. See "Expenses" and
"Dividends, Distributions and Taxes." In addition, Federal law imposes certain
limits on the purchases of mutual fund shares by the Portfolios.

MANAGEMENT OF FUNDMANAGER PORTFOLIOS Page 18

The Trust has retained Freedom Capital Management to act as its investment
adviser. For its services, the Adviser receives from each Portfolio a fee at the
annual rate of 0.50% of the Portfolio's average daily net assets up to $500
million and 0.40% of its average daily net assets in excess of $500 million. See
"The Adviser."

PURCHASE OF SHARES Page 21
Purchases of shares of the Trust by participants in the Program must be through
a brokerage account maintained with the Distributors. The minimum investment by
participants in the Program is $50,000. The minimum initial investment for other
qualified investors of each Portfolio is $1,000, and the minimum subsequent
investment is $100, except that the minimum initial investment for an Individual
Retirement Account ("IRA") is $250.

REDEMPTION OF SHARES Page 22

Shares may be redeemed at their next determined net asset value. See
"Determination of Net Asset Value." Redemptions may be made by letter or wire.
The Trust reserves the right to redeem, upon not less than 30 days' notice, all
shares of a Portfolio in an account (other than an IRA) which has a value below
$500.

DIVIDENDS, DISTRIBUTIONS AND TAXES Page 23
Aggressive Growth Portfolio will distribute net investment income annually;
Growth Portfolio will distribute net investment income semiannually; Growth with
Income Portfolio will distribute net investment income quarterly; and Bond
Portfolio will distribute its net investment income monthly. Each Portfolio will
distribute any net realized capital gains at least annually. All dividends and
distributions generally will be reinvested automatically at net asset value in
additional shares of the Portfolio making the distribution.

<PAGE>

PORTFOLIO EXPENSES

[TO BE FILED BY AMENDMENT]

<PAGE>

FINANCIAL HIGHLIGHTS

The Portfolios' financial data through September 30, 1997, shown below is to
assist investors in evaluating the performance of each Portfolio. The following
tables have been audited by Ernst & Young LLP, the Portfolios' Independent
Auditors. Their report, dated November __, 1997, on the Portfolios' financial
statements for the year then ended September 30, 1997, and the following tables
for the period presented, is included in the Annual Report, which is
incorporated by reference. These tables should be read in conjunction with the
Portfolios' financial statements and notes thereto, which are contained in the
Annual Report. Further information about the Portfolios' performance also is
contained in the Portfolios' Annual Report, dated September 30, 1997, which can
be obtained free of charge.

FUNDMANAGER PORTFOLIOS
The Trust was organized as a Delaware business trust on February 7, 1995, and is
an open-end management investment company registered under the Investment
Company Act of 1940 ("1940 Act") consisting of five diversified separate series
- -- Aggressive Growth Portfolio, Growth Portfolio, Growth with Income Portfolio,
Bond Portfolio and Managed Total Return Portfolio. This prospectus relates only
to the No-Load Class of Shares of Aggressive Growth Portfolio, Growth Portfolio,
Growth with Income Portfolio and Bond Portfolio. Investment in shares of one or
more of the Portfolios involves risks and there can be no assurance that the
Portfolios' investment objectives will be achieved.

INVESTMENT OBJECTIVES

Each Portfolio seeks to achieve its investment objective by investing in a
portfolio of other open-end registered investment companies (the "underlying
funds"). At times, for temporary defensive purposes when warranted by general
economic and financial conditions, a Portfolio may invest in money market mutual
funds or invest directly in (or enter into repurchase agreements maturing in
seven days or less with banks and broker-dealers with respect to) short-term
debt securities, including U.S. Treasury bills and other short-term U.S.
government securities, commercial paper, certificates of deposit and bankers'
acceptances. However, except when a Portfolio is in a temporary defensive
investment position or as may be considered necessary to accumulate cash in
order to satisfy minimum purchase requirements of the underlying funds or to
meet anticipated redemptions, a Portfolio normally will maintain its assets
invested in underlying funds. Although all of the Portfolios may invest in
shares of the same underlying fund, the percentage of each Portfolio's assets so
invested may vary and the Adviser will determine that such investments are
consistent with the investment objectives and policies of each particular
Portfolio. A Portfolio may not purchase shares of any closed-end investment
company or of any investment company which is not registered with the SEC. Each
Portfolio's investment objectives and certain of its related policies and
activities are fundamental and may not be changed by the Board of Trustees (the
"Trustees") of the Trust, on behalf of a particular Portfolio, without approval
of the shareholders of that Portfolio.

As a result, an investment in Aggressive Growth Portfolio can be expected to
involve greater risk than an investment in any of the other Portfolios.

GROWTH PORTFOLIO

The underlying funds in which the Growth Portfolio invests may be authorized to
invest up to 100% of their assets in the securities of foreign issuers and
engage in foreign currency transactions with respect to these investments;
invest up to 15% of their assets in Illiquid Securities; invest their assets in
warrants; lend their portfolio securities; sell securities short; borrow money
in amounts up to one-third of their assets for investment purposes; write or
purchase call or put options on securities or stock indexes; concentrate more
than 25% of their assets in one industry; invest up to 100% of their assets in
master demand notes; and enter into futures contracts and options on futures
contracts. The risks associated with these investments are described in
"Investments of and Investment Techniques Employed by Mutual Funds in Which the
Portfolios May Invest."

GROWTH WITH INCOME PORTFOLIO
The investment objective of Growth with Income Portfolio is realization of a
combination of capital appreciation and current income. The underlying funds in
which it invests will consist of funds which seek long-term capital appreciation
and/or funds which seek (i) income from dividends, (ii) income from interest, or
(iii) growth of income (or any combination of (i)-(iii)). These underlying funds
invest in common stocks, preferred stocks, bonds and other fixed-income
securities (including convertible preferred stock and convertible debentures).
The underlying funds also may, for temporary defensive purposes, invest in (or
enter into repurchase agreements with banks and broker-dealers with respect to)
U.S. government securities, commercial paper, certificates of deposit or other
money market securities.

These underlying funds may invest up to 100% of their assets in the securities
of foreign issuers and engage in foreign currency transactions with respect to
these investments; invest up to 15% of their assets in Illiquid Securities;
invest their assets in warrants; lend their portfolio securities; sell
securities short; borrow money in amounts up to one-third of their assets for
investment purposes; write or purchase call or put options on securities or on
stock indexes; concentrate more than 25% of their assets in any one industry;
invest up to 100% of their assets in master demand notes; invest in long or
short-term corporate bonds (see "Bond Portfolio ") and other fixed income
securities (such as U.S. government securities, commercial paper, preferred
stock, convertible preferred stock and convertible debentures); and enter into
futures contracts and options on futures contracts. The risks associated with
these investments are described below.

BOND PORTFOLIO
The investment objective of Bond Portfolio is a high level of current income.
The underlying funds in which it invests will include funds which seek high
current income by investing in long or short-term bonds and other fixed income
securities (such as securities issued or guaranteed or insured by the U.S.
government, its agencies or instrumentalities, commercial paper, preferred
stock, convertible preferred stock or convertible debentures). The underlying
funds also may lend their portfolio securities; sell securities short; borrow
money in amounts up to one-third of their assets for investment purposes; write
or purchase call or put options on securities or on stock indexes; invest up to
100% of their assets in master demand notes; and enter into futures contracts
and options on futures contracts.

INVESTMENTS OF AND INVESTMENT TECHNIQUES EMPLOYED BY MUTUAL FUNDS
IN WHICH THE PORTFOLIOS MAY INVEST
Illiquid Securities. An underlying fund may invest not more than 15% of its
assets in securities for which there is no readily available market ("Illiquid
Securities") which would include certain restricted securities the disposition
of which would be subject to legal restrictions and repurchase agreements having
more than seven days to maturity. A considerable period of time may elapse
between an underlying fund's decision to dispose of such securities and the time
when the fund is able to dispose of them, during which time the value of the
securities (and therefore the value of the underlying fund's shares held by a
Portfolio) could decline.

Repurchase Agreements. Underlying funds, particularly money market funds,
may enter into repurchase agreements with banks and broker-dealers under which
they acquire securities subject to an agreement with the seller to repurchase
the securities at an agreed upon time and price. The Portfolios also may enter
into repurchase agreements. These agreements are considered under the 1940 Act
to be loans by the purchaser that are collateralized by the underlying
securities. If the seller should default on its obligation to repurchase the
securities, the underlying fund may experience delay or difficulties in
exercising its rights to realize upon the securities held as collateral and
might incur a loss if the value of the securities should decline. For a more
complete discussion of repurchase agreements, see "Investment Policies" in the
SAI.

Loans of Portfolio Securities. An underlying fund may lend its portfolio
securities provided it complies with the following general requirements: (1) the
loan is secured continuously by collateral consisting of U.S. government
securities or cash or cash equivalents maintained on a daily mark-to-market
basis in an amount at least equal to the current market value of the securities
loaned; (2) the fund may at any time call the loan and obtain the return of the
securities loaned; (3) the fund will receive any interest or dividends paid on
the loaned securities; and (4) the aggregate market value of securities loaned
will not at any time exceed one-third of the total assets of the fund. Loans of
securities involve a risk that the borrower may fail to return the securities or
may fail to provide additional collateral.

The fund also must deposit in a segregated account (or earmark) an amount of
cash or U.S. government securities equal to the difference between (a) the
market value of the securities sold short at the time they were sold short and
(b) the value of the collateral deposited with the broker in connection with the
short sale (not including the proceeds from the short sale). While the short
position is open, the fund must maintain daily the segregated account at such a
level that (1) the amount deposited in it plus the amount deposited with the
broker as collateral equals the current market value of the securities sold
short and (2) the amount deposited in it plus the amount deposited with the
broker as collateral is not less than the market value of the securities at the
time they were sold short. Depending upon market conditions, up to 80% of the
value of a fund's net assets may be deposited as collateral for the obligation
to replace securities borrowed to effect short sales and allocated to a
segregated account in connection with short sales.

DERIVATIVES

An underlying fund may invest in the following instruments that are commonly
known as derivatives. Generally, a derivative is a financial arrangement, the
value of which is based on, or "derived" from, a traditional security, asset, or
market index.

INVESTMENT POLICIES AND RESTRICTIONS

Under each Portfolio's policies which are not fundamental, no Portfolio may (i)
purchase or otherwise acquire the securities of any open-end investment company
(except in connection with a merger, consolidation, acquisition of substantially
all of the assets or reorganization of another investment company) if, as a
result, a Portfolio and all of its affiliates including the other Portfolios
would own more than 3% of the total outstanding stock of that company, or (ii)
purchase a security which is not readily marketable if, as a result, more than
15% of that Portfolio's net assets would consist of such securities. For this
purpose, securities which are not readily marketable include repurchase
agreements having more than seven days to maturity (see "Investments of and
Investment Techniques Employed by Mutual Funds in Which the Portfolios May
Invest") and may include shares of an open-end investment company owned by the
Portfolios in an amount exceeding 1% of the issuer's total outstanding
securities. See "Risks and Other Considerations."

RISKS AND OTHER CONSIDERATIONS

EXPENSES
As an investor in the Portfolios, you should recognize that you may invest
directly in mutual funds and that, by investing in mutual funds indirectly
through the Portfolios, you will bear not only your proportionate share of the
expenses of the Portfolios (including operating costs and investment advisory
and administrative fees) but also, indirectly, similar expenses of the
underlying funds. If you are an investor in the Portfolios through the Program
offered by the Distributors you should recognize that the combined expenses of
the Program and of the Portfolios (including their indirect expenses) may
involve greater fees and expenses than present in other types of investments
without the benefit of professional asset allocation recommendations, and you
may indirectly bear expenses paid by an underlying fund related to the
distribution of its shares. As a Portfolio shareholder, you also will bear your
proportionate share of any sales charges incurred by the Portfolio related to
the purchase of shares of the underlying funds. Finally, as an investor, you
should recognize that, as a result of the Portfolios' policies of investing in
other mutual funds, you may receive taxable capital gains distributions to a
greater extent than would be the case if you invested directly in the underlying
funds. See "Dividends, Distributions and Taxes."

MANAGEMENT OF FUNDMANAGER PORTFOLIOS

Michael D. Hirsch is the Portfolio Manager of the Portfolios and is responsible
for the day to day management of the Portfolios. Currently, Mr. Hirsch is
Chairman of the M.D. Hirsch Division of Freedom Capital Management. Prior to
February 21, 1995, Mr. Hirsch was the Vice Chairman and Managing Director of the
M.D. Hirsch Division of Republic Asset Management. Mr. Hirsch served as
President of M.D. Hirsch Investment Management, Inc. ("Hirsch") from February,
1991 until June, 1993 and Chief Investment Officer of Republic National Bank of
New York ("Republic") from 1981 until February, 1991. Mr. Hirsch pioneered the
concept of investing his clients' assets in a portfolio of mutual funds in 1975.
Mr. Hirsch is now a noted authority on mutual funds and has authored two books,
"Multifund Investing" in 1987 and "The Mutual Fund Wealth Builder" in 1991.

Maximum
Administrative Average Aggregate
Fee Daily Net Assets
.150% on the first $250 million
.125% on the next $250 million
.100% on the next $250 million
.075% on assets in excess of $750 million

THE DISTRIBUTORS
The Trustees of the Trust have approved a Distribution Contract (the
"Distribution Contract") between the Trust and each of Edgewood, Freedom
Distributors, Tucker Anthony and Sutro pursuant to which each will serve as a
distributor of the Trust and of the Shares of each of the Portfolios.

The distributors may provide promotional incentives to investment executives who
support the sale of shares of the Portfolios. In some instances, these
incentives may be offered only to certain investment executives which provide
services in connection with the sale or expected sale of significant amounts of
shares.

OTHER EXPENSES
The Trust bears all costs of its operations other than expenses specifically
assumed by the Administrator, Distributors or the Adviser. See "Management" in
the SAI. Expenses directly attributable to a Portfolio or class are charged to
that Portfolio or class; other expenses are allocated proportionately among the
Portfolios or classes, as the case may be, in relation to the net assets of each
Portfolio or class.

PORTFOLIO TRANSACTIONS
Pursuant to the Investment Advisory Contract, the Adviser places orders for the
purchase and sale of portfolio investments for a Portfolio's accounts with
brokers or dealers, selected by it in its discretion, including Freedom
Distributors and Edgewood. With respect to purchases of certain money market
instruments, purchase orders are placed directly with the issuer or its
agent.With respect to purchases of shares of underlying funds, the Portfolio may
pay a sales charge. Sales charges of the underlying funds generally consist of
two parts, the "dealer reallowance" (which typically comprises at least 80% of
the amount of the charge and is paid to the broker participating in the sale of
the underlying fund shares) and the underwriter's retention. To the extent
permissible by law, Freedom Distributors and Edgewood will be designated as the
participating brokers entitled to receive the dealer reallowance portion of the
sales charge on purchases of load fund shares by the Portfolios. However,
Freedom Distributors will not retain any dealer reallowance in excess of 1% of
the public offering price on any transaction nor will it be designated as the
broker entitled to receive the dealer reallowance portion of the sales charge
where such reallowance would exceed 1% of the public offering price. With
respect to purchases of underlying fund shares, the Adviser directs
substantially all of the Portfolios' orders to either Freedom Distributors or
Edgewood, which may, in its discretion, direct the order to other broker-dealers
in consideration of sales of that Portfolio's shares, except where the direction
to another broker-dealer would increase the dealer reallowance paid by a fund to
Freedom Distributors above 1% of the public offering price.

DETERMINATION OF NET ASSET VALUE

The net asset value per share of each Portfolio is determined as of the close of
trading (normally 4:00 p.m., Eastern time) on the NYSE, Monday through Friday,
except on: (i) days on which there are not sufficient changes in the value of a
Portfolio's portfolio securities that its net asset value might be materially
affected; (ii) days during which no shares are tendered for redemption and no
orders to purchase shares are received; and (iii) the following holidays: New
Year's Day, Martin Luther King Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. Net asset
value per share is calculated by dividing the aggregate value of a Portfolio's
assets allocable to the Class less all liabilities by the number of that Class'
outstanding shares.

PURCHASE OF SHARES

Shares of the Portfolios are offered by the Distributors as an investment
vehicle for individuals, institutions, corporations and fiduciaries in the
Program offered by the Distributors. The participants in the Program receive,
for a fee at a maximum annual rate based upon a percentage of assets invested,
certain services, including asset allocation recommendations with respect to the
Portfolios based on an evaluation of their investment objectives and risk
tolerances. Shares of the Portfolios are offered for sale at net asset value by
the Distributors to participants in the Program. Shares of the Portfolios may
also be offered to employees through tax-deferred retirement plans of the
Distributors and the Adviser. Each Portfolio may invest in underlying funds
which are sold with a sales charge. Prospectuses, sales material and
applications relating to the Portfolios can be obtained from the Distributors.

Purchases of shares of the Trust by participants in the Program must be through
a brokerage account maintained with the Distributors. The minimum investment by
participants in the Program is $50,000. The minimum initial investment for other
qualified investors is $1,000, except that the minimum initial investment for an
IRA is $250. The minimum subsequent investment is $100. The minimum initial
investment is waived for purchases by Trustees, officers and employees of the
Trust, the Adviser or a Distributor, including their immediate families and
certain accounts. Each Portfolio also reserves the right to vary the initial and
subsequent investment minimums. All purchase payments are invested in full and
fractional shares. The Trust and each Distributor are authorized to reject any
purchase order.

PURCHASES BY CLIENTS OF THE DISTRIBUTORS OR AUTHORIZED SECURITIES DEALERS
If you have a Program account with a Distributor, you may purchase any
Portfolio's Shares through your investment executive. Your investment executive
has the responsibility of submitting your purchase order to FSSC on such day in
order to obtain that day's applicable purchase price. Purchase orders received
by FSSC after the time of determining that day's purchase price (generally 4:00
p.m., New York time), are priced according to the net asset value per Share of
the Portfolio next determined on the following business day. Payment for
purchase orders must be made to such Distributor within three business days of
the purchase order.

The Distributors will receive statements and dividends directly from the
Portfolios and will in turn provide you with account statements reflecting the
Portfolios' purchases, redemptions and dividend payments. If you wish additional
information concerning your investment in the Program made through a
Distributor, please call your investment executive.

FUNDMANAGER ADVISORY PROGRAM
The Adviser, through the Program, provides discretionary advisory services in
connection with investments among the Portfolios. Under the Program, investment
executives of the Distributors provide services to an investor by assisting the
investor in identifying his or her financial objectives, preferences and risk
tolerances through evaluation of a confidential questionnaire-Client Information
Guide. Based on its evaluation of the investor's financial goals and
circumstances, the Adviser allocates the investor's assets among Automated Cash
Management Trust, California Municipal Cash Trust, and New York Municipal Cash
Trust money market funds and some or all of the Portfolios. The Adviser will
adjust each investor's Program portfolio among the money fund and the Portfolios
from time to time based on its assessment of the economy, interest rates, the
financial markets and macro-economic events worldwide. The Program is a
continuing investment advisory program. Once a Program is active, the investor
receives, at least quarterly, a report containing an analysis and evaluation of
the investor's portfolio. Investment executives of the Distributors may review
the quarterly report with the investor, monitor identified changes in the
investor's financial characteristics and communicate any changes to the Adviser.

The Distributors are paid a quarterly fee for the services comprising the
Program at the maximum annual rate of 1.35% of assets held in a Program account.
Where the investor is a qualified retirement plan, a different fee schedule may
apply. Investment executives of the Distributors will receive, and the Adviser
may receive, a portion of any fee paid by Program clients. The Adviser also
receives advisory fees from the Portfolios and from each of the money market
funds in the Freedom Group of Money Funds. The Program fees may be subject to
negotiation based on a number of factors including, but not limited to, the size
of the Program account. The operating expenses of the money market fund and the
Portfolios, when combined with the Program fee, may involve greater fees and
expenses than other mutual funds whose shares are purchased without the benefit
of asset allocation recommendations rendered by investment advisers such as the
Adviser.

For participants in the Program, shares of the Portfolios may be purchased
directly through the Distributors only after the completion and processing of
the investor's Client Information Guide and applicable documents. The offering
price is the net asset value per share next determined following receipt of an
order by the Distributors.

REDEMPTION OF SHARES

REDEMPTION OF SHARES PURCHASED THROUGH A DISTRIBUTOR
In order to redeem your shares purchased through a Distributor in the Program,
you should advise your investment executive, by telephone or mail, to execute
the redemption. Redemption requests received by the close of the NYSE (generally
4:00 p.m., New York time), are effective that day. Your investment executive has
the responsibility of submitting your redemption request to FSSC on such day in
order to obtain that day's applicable redemption price. There is no redemption
charge. Redemption proceeds will be held in your brokerage account unless you
give instructions to your investment executive to remit the proceeds to you.

The proceeds of redemption may be more or less than the amount invested and,
therefore, a redemption may result in a gain or loss for Federal income tax
purposes.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Each Portfolio intends to continue to qualify as a regulated investment company
under Subchapter M of the Code. In any year in which a Portfolio qualifies as a
regulated investment company and distributes substantially all of its investment
company taxable income (which includes, among other items, the excess of net
short-term capital gains over net long-term capital losses) and its net capital
gains (the excess of net long-term capital gains over net short-term capital
losses), the Portfolio will not be subject to Federal income tax to the extent
it distributes to shareholders such income and capital gains in the manner
required under the Code. Amounts not distributed on a timely basis in accordance
with a calendar year distribution requirement are subject to a nondeductible 4%
excise tax. To prevent imposition of the excise tax, each Portfolio must
distribute for each calendar year an amount equal to the sum of (1) at least 98%
of its net ordinary income (excluding any capital gains or losses) for the
calendar year, (2) at least 98% of the excess of its capital gains over capital
losses (adjusted for certain ordinary losses) realized during the one-year
period ending October 31 of such year, and (3) all ordinary income and capital
gains for previous years that were not distributed during such years. A
distribution will be treated as paid on December 31 of the calendar year if it
is declared by the Portfolio in October, November or December of that year with
a record date in such a month and paid by the Portfolio during January of the
following calendar year. Such distributions will be taxable to shareholders in
the calendar year in which the distributions are declared, rather than the
calendar year in which the distributions are received. The Portfolio intends to
distribute its income in accordance with this requirement to prevent application
of the excise tax.

Each year the Trust will notify shareholders of the tax status of dividends and
distributions.

Distributions of net capital gains (the excess of net long-term capital gains
over net short-term capital losses) received by a Portfolio from mutual funds,
as well as net long-term capital gains realized by a Portfolio from the purchase
and sale (or redemption) of mutual fund shares or other securities held
(generally) by a Portfolio for more than one year, will be distributed by the
Portfolio and will be taxable to shareholders as long-term capital gains (even
if the shareholder has held the shares for less than one year). However, if you
receive a capital gains distribution and suffer a loss on the sale of your
shares not more than six months after purchase, the loss will be treated as a
long-term capital loss to the extent of the capital gains distribution received.
The long-term capital gains, including distributions of net capital gains are
currently subject to a maximum federal tax rate of 28% which is less than the
maximum rate imposed on other types of taxable income. Furthermore, capital
gains may be advantageous because, unlike ordinary income, they may be offset by
capital losses.

The tax treatment of distributions from a Portfolio is the same whether the
distributions are received in additional shares or in cash. Shareholders
receiving distributions in the form of additional Shares will have a cost basis
for Federal income tax purposes in each share received equal to the net asset
value of a share of the Portfolio on the reinvestment date.

Aggressive Growth Portfolio will distribute investment company taxable income
annually; Growth Portfolio will distribute investment company taxable income
semi-annually; Growth with Income Portfolio and Bond Portfolio will distribute
investment company taxable income monthly. Each Portfolio will distribute any
net realized capital gains at least annually. All dividends and distributions
will be reinvested automatically at net asset value in additional shares of the
Portfolio making the distribution, unless you have notified the Portfolio in
writing of your election to receive distributions in cash.

OTHER INFORMATION
Capitalization

The Trust (initially named FundManager Trust, and since renamed FundManager
Portfolios) was organized as a Delaware business trust on February 7, 1995 as a
successor, with respect to the Portfolios, to Republic Funds (formerly,
FundTrust) a Massachusetts business trust (organized on April 22, 1987).
Republic Funds succeeded two previously existing Massachusetts business trusts,
FundTrust Tax-Free Trust (organized on July 30, 1986) and FundVest (organized on
July 17, 1984 and since renamed Fund Source). The Trust currently consists of
five separately-managed portfolios - Aggressive Growth Portfolio (formerly,
Aggressive Growth Fund), Growth Portfolio (formerly, Growth Fund), Growth with
Income Portfolio (formerly, Growth & Income Fund), Bond Portfolio (formerly,
Bond Fund, and before that, Income Fund), and Managed Total Return Portfolio
(formerly, Managed Total Return Fund) - each offering two classes of shares of
beneficial interest, the Financial Adviser Class and the No-Load Class (except
for Managed Total Return, which only offers Financial Adviser Class). The
Trustees may establish additional portfolios and divide shares in each portfolio
into classes in the future. The capitalization of the Trust consists solely of
an unlimited number of shares of beneficial interest with a par value of $0.001
each. When issued, shares of the Portfolios are fully paid, non-assessable and
freely transferable.

Voting
Shareholders have the right to vote in the election of Trustees and on any and
all matters on which by law or the provisions of the Master Trust Agreement they
may be entitled to vote. When matters are submitted for shareholder vote,
shareholders will have one vote for each full share held and proportionate,
fractional votes for fractional shares held. A separate vote of a Portfolio or
class is required on any matter affecting that Portfolio or class on which
shareholders are entitled to vote. Shareholders of a Portfolio or class are not
entitled to vote on Trust matters that do not affect the Portfolio or class and
do not require a separate vote of the Portfolio or class. The Trust is not
required to hold regular annual meetings of its shareholders and does not intend
to do so. See "Other Information--Voting Rights" in the SAI. As of ____, 1997,
Turtle & Co. FC1202, c/o State Street Bank & Trust Company, P.O. Box 9242,
Boston, MA 02209, was the owner of record of 25.72% of the voting securities of
the Growth Portfolio, and therefore, may, for certain purposes be deemed to
control the Portfolio and be able to affect the outcome of certain matters
presented for a vote of shareholders. As of ____, 1997, Turtle & Co. FC1202, c/o
State Street Bank & Trust Company, P.O. Box 9242, Boston, MA 02209, was the
owner of record of 25.66% of the voting securities of the Growth with Income
Portfolio, and therefore, may, for certain purposes be deemed to control the
Portfolio and be able to affect the outcome of certain matters presented for a
vote of shareholders. As of ____, 1997, Turtle & Co. FC1202, c/o State Street
Bank & Trust Company, P.O. Box 9242, Boston, MA 02209, was the owner of record
of 73.98% of the voting securities of the Bond Portfolio, therefore, may, for
certain purposes be deemed to control the Portfolio and be able to affect the
outcome of certain matters presented for a vote of shareholders.

In compliance with applicable provisions of the 1940 Act, shares of the
underlying funds owned by the Portfolios will be voted in the same proportion as
the vote of all other holders of those shares.

Consistent with applicable regulatory guidance, for the period prior to its
establishment, the Class will adopt the performance of the Portfolios and the
predecessor Portfolios. The performance for this period will reflect the
deduction of expenses set forth in the Portfolio Expense Table. See "Portfolio
Expenses."

For a more detailed description of the methods used to calculate each
Portfolio's yield and total return, see the SAI.

OTHER CLASSES OF SHARES
The Portfolios also offer another class of shares called Financial Adviser Class
shares. Financial Adviser Class shares are sold at net asset value as an
investment vehicle for individuals, institutions, corporations and fiduciaries.
The minimum initial investment for Financial Adviser Class shares of each
Portfolio is $1,000, and the minimum subsequent investment is $100, except that
the minimum initial investment for an Individual Retirement Account ("IRA") is
$250.

Both classes are subject to certain of the same expenses. However, Financial
Adviser Class shares are distributed with 12b-1 fees.

Expense differences between classes may affect the performance of each class.

SHAREHOLDER INQUIRIES
All shareholder inquiries should be directed to your investment executive or
financial adviser or call (800) 344-9033 (Toll Free).

S&P applies indicators "+", no character, and "-" to its rating categories. The
indicators show relative standing within the major rating categories.

PART C OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements: To be filed by amendment.

(b) Exhibits:
<TABLE>
<CAPTION>

(l) (i) Conformed copy of the Master Trust Agreement of the Registrant; (4)
(ii) Conformed copy of the Amendment No. 1 to Master Trust Agreement; (4)
(iii) Conformed copy of the Amendment No. 2 to Master Trust Agreement; (11)
(iv) Conformed copy of the Amendment No. 3 to Master Trust Agreement; (11)
(2) Copy of By-Laws of the Registrant; (4)
(3) Not Applicable
(4) Not Applicable
(5) Conformed copy of the new Master Investment Advisory Contract and Investment Advisory
Contract Supplement for Aggressive Growth
Portfolio, Growth Portfolio, Growth with Income Portfolio, Bond Portfolio,
Managed Total Return Portfolio; (11)
(6) (i) Conformed copy of the Distributors Contract between Edgewood
Services Company and FundManager
Portfolios; (11)
(ii) Conformed copy of the Master Distributors Contract between Tucker
Anthony Incorporated and FundManager Portfolios; (11)
(iii) Conformed copy of the Master Distributors Contract between
Sutro & Co. Incorporated and FundManager Portfolios; (11)
(iv) Conformed copy of the Master Distributors Contract between Freedom
Distributors Corporation and FundManager Portfolios; (11)
(7) Not Applicable
(8) Conformed copy of Custodian Agreement between FundManager Portfolios and Investors
Bank & Trust Company; (11)
(9) (i) Conformed copy of the Administrative Services Agreement between FundManager
Portfolios and Federated Administrative Services;
(11)
(ii) Conformed copy of the Transfer Agency and Service Agreement between
FundManager Portfolios and Investors Bank & Trust Company; (11)
(10) Opinion and Consent of counsel; (2)
</TABLE>

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

+ All exhibits have been filed electronically.

(2) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registrant's Registration Statement as filed with the Commission on May 3,
1995. (File Nos. 33-89754 and 811-8992)

(4) Incorporated by reference to Post-Effective Amendment No.2 to the
Registrant's Registration Statement as filed with the Commission on January
30, 1996. (File Nos. 33-89754 and 811-8992)

(11) Incorporated by reference to Post-Effective Amendment No.4 to the
Registrant's Registration Statement as filed with the Commission on January
23, 1997. (File Nos. 33-89754 and 811-8992)

<PAGE>

(11) Not Applicable
(12) Not Applicable
(13) Not Applicable
(14) Not Applicable
(15) Amended and Restated Master Distribution Plan and Supplements
for the Financial Adviser Class of shares; (3)
(16) Copy of Performance Data Calculations: Aggressive Growth
Portfolio, Growth Portfolio, Growth with Income Portfolio,
Bond Portfolio, Managed Total Return
Portfolio; (2)
(17) Not Applicabble
(18) Multiple Class Expense Allocation Plan; (3)
(19) Conformed copy of Powers of Attorney of Trustees and
Officers of Registrant; (11)

ITEM 25. Persons Controlled by or Under Common Control with Registrant:

Not Applicable

ITEM 26. Number of Holders of Securities.

Title of Class Number of Record Holders
as of September 17, 1997

Aggressive Growth Portfolio
Financial Adviser Class 1,509
No-Load Class 142

Growth Portfolio
Financial Adviser Class 726
No-Load Class 128

Growth with Income Portfolio
Financial Adviser Class 828
No-Load Class 131

Bond Portfolio
Financial Adviser Class 210
No-Load Class 110

Managed Total Return Portfolio
Financial Adviser Class 591

International Portfolio
Financial Adviser Class 0
No-Load Class 0

ITEM 27. Indemnification; (4)

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

+ All exhibits have been filed electronically.

(2) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registrant's Registration Statement as filed with the Commission on May 3,
1995. (File Nos. 33-89754 and 811-8992)

(3) Incorporated by reference to Post-Effective Amendment No.1 to the
Registrant's Registration Statement as filed with the Commission on July
28, 1995. (File Nos. 33-89754 and 811-8992)

(4) Incorporated by reference to Post-Effective Amendment No.2 to the
Registrant's Registration Statement as filed with the Commission on January
30, 1996. (File Nos. 33-89754 and 811-8992)

(11) Incorporated by reference to Post-Effective Amendment No.4 to the
Registrant's Registration Statement as filed with the Commission on January
23, 1997. (File Nos. 33-89754 and 811-8992)

ITEM 28. Business and Other Connections of Investment Adviser:

For a description of the other business of the investment adviser, see
the section entitled "Management of FundManager Portfolios-The Adviser" in Part
A.

The names and principal occupations of each director and executive officer of
Freedom Capital Management Corporation are set forth below:

NAME BUSINESS AND OTHER CONNECTIONS

John H. Goldsmith President and Chief Executive Officer of
Freedom Securities Corporation; Chairman and Chief
Executive Officer of Tucker Anthony Incorporated;
Managing Director of Freedom Capital

Dexter A. Dodge Chairman and Director of Freedom Capital;
Vice President of Freedom Distributors Corporation

Lawrence G. Kirshbaum Chief Financial Officer of Freedom
Securities Corporation; Director of Tucker Anthony
Holding Corp., Sutro Group and John
Hancock Clearing Corporation; Managing Director of
Freedom Capital; Registered Principal of
Tucker Anthony Incorporated; Former Chief
Executive Officer of Kirshbaum & Co. and of
Prescott, Ball & Turben

John J. Danello Chief Operating Officer, Managing Director, Clerk and
General Counsel of Freedom Capital; President and
Director of Freedom Distributors Corporation

Richard V. Howe Managing Director of Freedom Capital

Arthur E. McCarthy Managing Director of Tucker Anthony Incorporated

Michael M. Spencer Senior Vice President and Director of Fixed-Income
Investments of Freedom Capital;
Portfolio Manager at Shawmut Investment Advisers

Terrence J. Gerlich Managing Director of Freedom Capital

Charles B. Lipson President of the M.D. Hirsch Division of the
Adviser since February 1995; President and Chief
Operating Officer of the M.D. Hirsch Division of
Republic Asset Management Corporation from February
1991 to December 1994

Michael D. Hirsch Chairman, M.D. Hirsch Division of the Adviser since
February 1995; Vice President and Executive Vice
Chairman and Managing Director, Portfolio Manager
of M.D. Hirsch Division of Republic Asset Management
Corporation from June 1993 to February 1994

<PAGE>

ITEM 29. Principal Underwriters

(a) Edgewood Services, Inc. the Distributor for shares of the
Registrant, acts as principal underwriter for the following
open-end investment companies, including the Registrant: BT
Advisor Funds, BT Pyramid Mutual Funds, BT Investment Funds, BT
Institutional Funds, Excelsior Institutional Trust (formerly, UST
Master Funds, Inc.), Excelsior Tax-Exempt Funds, Inc. (formerly,
UST Master Tax-Exempt Funds, Inc.), Excelsior Institutional
Trust, FTI Funds, FundManager Portfolios, Marketvest Funds,
Marketvest Funds, Inc. and Old Westbury Funds, Inc.

(b)
<TABLE>
<CAPTION>

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Lawrence Caracciolo Director, President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Arthur L. Cherry Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

J. Christopher Donahue Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Thomas P. Sholes Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Ronald M. Petnuch Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Thomas P. Schmitt Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

S. Elliott Cohan Secretary, Assistant Secretary
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Thomas J. Ward Assistant Secretary, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779

Kenneth W. Pegher, Jr. Treasurer, --
Federated Investors Tower Edgewood Services, Inc.

<PAGE>

(ai) Freedom Distributors Corp., a Distributor for shares of the Registrant,
also acts as principal underwriter for the following open-end investment
companies: Freedom Mutual Fund and Freedom Group of Tax Exempt Funds.

(bi)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant

John J. Danello President and Director Executive Vice
One Beacon Street of Freedom Distributors President of the
Boston, MA 02108 Corp. Registrant.

Michael G. Ferry Treasurer of Freedom --
One Beacon Street Distributors Corp.
Boston, MA 02108

Dexter A. Dodge Director of Freedom Trustee, Chairman
One Beacon Street Distributors Corp. and Chief
Boston, MA 02108 Executive Officer of the Registrant.

Maureen M. Renzi Vice President and Clerk Assistant
One Beacon Street of Freedom Distributors Secretary of the
Boston, MA 02108 Corp. Registrant.

(aii) Tucker Anthony Incorporated, a Distributor for shares of the Registrant,
also acts as principal underwriter for the following open-end investment
companies: Freedom Mutual Fund and Freedom Group of Tax Exempt Funds.

(bii)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant

John H. Goldsmith Chairman, Chief Executive --
One World Financial Center Officer and Director of
New York, NY 10281 Tucker Anthony Incorporated.

Robert H. Yevich President and Director of --
One World Financial Center Tucker Anthony Incorporated.
New York, NY 10281

Thomas A. Pasquale Executive Vice President --
One World Financial Center and Director of Tucker
New York, NY 10281 Anthony Incorporated.

Marc Menchel Executive Vice President, --
One World Financial Center Secretary and Clerk of
New York, NY 10281 Tucker Anthony Incorporated.

Thomas E Gilligan Treasurer and Chief Executive, --
One World Financial Center Officer of Tucker Anthony
New York, NY 10281 Incorporated.

<PAGE>

(aiii) Sutro & Co. Incorporated, a Distributor for shares of the Registrant,
also acts as principal underwriter for the following open-end investment
companies: Freedom Mutual Fund and Freedom Group of Tax Exempt Funds.

(biii)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant

John F. Luikart President and Chief Executive --
201 California Street Officer of Sutro & Co.
San Francisco, CA 94111 Incorporated.

Mary Jane Delaney Executive Vice President --
201 California Street and General Counsel of
San Francisco, CA 94111 Sutro & Co. Incorporated.

John H. Goldsmith Director of Sutro & Co. --
One World Financial Center Incorporated.
New York, NY 10281

Fergus J. Henehan Executive Vice President of --
201 California Street Sutro & Co. Incorporated.
San Francisco, CA 94111

John W. Eisle Executive Vice President of --
201 California Street Sutro & Co. Incorporated.
San Francisco, CA 94111

Thomas R. Weinberger Executive Vice President of --
201 California Street Sutro & Co. Incorporated.
San Francisco, CA 94111

ITEM 30. Location of Accounts and Records:

All accounts and records required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and the Rules 31a-1 through 31a-3 promulgated
thereunder will be maintained at one of the following locations:

Registrant Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779

Freedom Capital Management Corporation One Beacon Street
("Adviser") Boston Massachusetts 02108.

Federated Administrative Services Federated Investors Tower
("Administrator") Pittsburgh, Pennsylvania 15222-3779

Federated Shareholder Services Company P.O. Box 8600
("Transfer Agent and Dividend Boston, Massachusetts 02266-8600
Disbursing Agent and Shareholder
Servicing Agent")

State Street Bank and Trust Company P.O. Box 8600
("Custodian and Portfolio Boston, Massachusetts 02266-8600
Accountant")

<PAGE>

ITEM 31. Management Services:
Not applicable.

ITEM 32. Undertakings

Registrant hereby undertakes to comply with Section 16(c) of the 1940
Act as though such provisions of the 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 or
values of shares held by such requesting shareholders.

Registrant hereby undertakes to furnish to each person to whom a
prospectus is delivered a copy of the Registrant's latest annual report
to shareholders upon request and without charge.

Registrant hereby undertakes to file a post-effective amendment using
financial statements, which need not be certified, within four to six months
from the effective date of Registrant's Post- Effective Amendment No. 5.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, the Registrant, FUNDMANAGER PORTFOLIOS
(formerly, FundManager Trust), has duly caused this Amendment to its
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Pittsburgh and the Commonwealth of Pennsylvania
on the 30th day of September, 1997.

FUNDMANAGER PORTFOLIOS
(formerly, FUNDMANAGER TRUST)

By: /s/ Victor R. Siclari
Victor R. Siclari, Secretary
September 30, 1997

Pursuant to the requirements of the Securities Act of 1933, this
Amendment to its Registration Statement has been signed below by the following
person in the capacity and on the date indicated:

NAME TITLE DATE

By: /s/ Victor R. Siclari Attorney in Fact September 30, 1997
Victor R. Siclari For the Persons
SECRETARY Listed Below

/s/Dexter A. Dodge* Chairman and Trustee
Dexter A. Dodge (Chief Executive Officer)

/S/Charles B. Lipson* President
Charles B. Lipson (Principal Executive Officer)

/S/Judith J. Mackin* Treasurer
Judith J. Mackin (Principal Financial and
Accounting Officer)

/S/Ernst T. Kendall* Trustee
Ernst T. Kendall

/S/Richard B. Osterberg* Trustee
Richard B. Osterberg

/S/John R. Haack* Trustee
John R. Haack

* By Power of Attorney