DLJ WINTHROP Funds
Prospectus
February 28, 2000
Leadership through Experience
DLJ WINTHROP FOCUS FUNDS
DLJ Winthrop Growth Fund
DLJ Winthrop Growth and Income Fund
DLJ Winthrop Small Company Value Fund
DLJ Winthrop Fixed Income Fund
DLJ Winthrop Municipal Trust Fund
DLJ WINTHROP OPPORTUNITY FUNDS
DLJ Winthrop International Equity Fund
DLJ Winthrop Developing Markets Fund
DLJ Winthrop High Income Fund
DLJ Winthrop Municipal Money Fund
DLJ Winthrop U.S. Government Money Fund
This prospectus provides information about two separate series of Funds: the DLJ
Winthrop Focus Funds and the DLJ Winthrop Opportunity Funds. Each series has a
number of individual funds. Each fund has a separate investment objective and
portfolio of investments.
The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the adequacy of this prospectus. Any representation to
the contrary is a criminal offense.
An investment in any of the Funds is not a deposit of any bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
TABLE OF CONTENTS
4 DLJ Winthrop Focus Funds' Risk Return Summary
9 DLJ Winthrop Opportunity Funds' Risk Return Summary
13 Summary of DLJ Winthrop Fund Expenses
14 Annual Fund Operating Expenses
16 Purchase Information
17 DLJ Winthrop Focus Funds' Investment Objectives and Policies
23 DLJ Winthrop Opportunity Funds' Investment Objectives and Policies
29 Additional Information on Investment Policies and Risks
33 Fund Management
35 How to Buy and Sell Shares
38 Other Shareholder Information
42 Additional Shareholder Services
44 Distribution Charges
44 Dividend and Distribution Information
45 Taxes
47 Financial Highlights
52 For More Information
<PAGE>
This part of the prospectus summarizes each Fund's investment objective,
principal investment strategies and principal risks. This section also contains
limited performance data. More information about the DLJ Winthrop Funds is
contained in "DLJ Focus Funds' Investment Objectives and Policies", DLJ Winthrop
Opportunity Funds' Investment Objectives and Policies" and "Additional
Information on Investment Policies and Risks." Please read the entire prospectus
carefully before investing and save it for future reference.
DLJ WINTHROP FOCUS FUNDS' RISK RETURN SUMMARY
THE DLJ WINTHROP GROWTH FUND
The DLJ WINTHROP GROWTH FUND's investment objective is long-term capital
appreciation. The Fund seeks to achieve its objective by investing in companies
that offer long-term capital appreciation. The Fund invests in common stock,
securities convertible into common stock and other equity securities of
well-known and established companies. The Fund takes a long-term view of each
stock it buys, holding each company until its long-term growth potential no
longer meets the Fund's requirements. Generally, the Fund attempts to identify
companies with growth rates that will exceed that of the S&P 500 Index. The Fund
may also make an investment to earn income when its Adviser believes that it
will not compromise the investment objective. To achieve this objective, the
Fund may invest up to 35% of the value of its assets in investment-grade fixed
income securities, including bonds, debentures, notes, asset and mortgage-backed
securities and money market instruments such as commercial paper and bankers'
acceptances and other financial instruments. The Fund may also invest in
non-U.S. securities.
Like any investment, an investment in the DLJ Winthrop Growth Fund is subject to
risk and you could lose money. While investments are selected that the Adviser
believes will experience long-term appreciation, their value could decline. The
Fund is subject to risks that affect equity securities markets in general, such
as general economic conditions and adverse changes (generally increases) in
interest rates. These and other factors could adversely affect your investment.
The following chart and table illustrate the risk by showing variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1, 5 and 10 years compare to those of the S&P 500 Composite Index,
which is a broad measure of market performance. The Fund's past performance is
not necessarily an indication of how it will perform in the future.
1999 28%
1998 28%
1997 28%
1996 20%
1995 24%
1994 -4%
1993 14%
1992 2%
1991 28%
1990 -7%
<PAGE>
During the 10-year period shown in the bar chart for Class A shares, the
highest return for a quarter was 21.16% (quarter ending 12/31/98) and the
lowest return for a quarter was -15.22% (quarter ending 9/30/90).
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown.
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year Past 5 years Past 10 years
================================================================================
Growth Fund Class A 20.57% 24.14% 14.54%
Growth Fund Class B 22.93% N/A N/A
================================================================================
S&P 500* 21.04% 28.55% 18.21%
================================================================================
The Fund commenced offering Class D shares on May 13, 1999. Prior to the date of
this prospectus, the Fund had not yet commenced offering Class C shares.
*The S & P 500(R) is the Standard & Poor's Composite Index of 500 Stocks, a
widely recognized, unmanaged index of common stock prices. The returns for the
S&P 500 do not include any sales charges, fees or other expenses. The returns
for the Fund reflect the maximum applicable sales charges currently in effect.
THE DLJ WINTHROP GROWTH AND INCOME FUND
The DLJ Winthrop Growth and Income Fund's investment objective is long-term
capital appreciation and continuity of income. The Fund seeks to achieve its
objective by investing in dividend paying common stock and by diversifying its
investments among different industries and different companies. Securities are
selected on the basis of their investment merit and their potential for
appreciation in value and/or income, with a focus on stability. The Adviser
identifies companies that it believes are undervalued and waits for the market
to discover that value. A portion of the Fund is invested in debt securities
that are of investment-grade quality, U.S. Government securities and money
market instruments. The Fund may also invest in non-U.S. securities. There is no
fixed percentage of the Fund's assets that must be invested in any particular
type of security.
Like any investment, an investment in the DLJ Winthrop Growth and Income Fund is
subject to risk and you could lose money. While the Fund seeks investments that
will appreciate in value and/or provide income, the Adviser could select
securities that will decline in value and provide no income.
The Fund is also subject to risks that affect equity securities markets in
general, such as general economic conditions and adverse changes (generally
increases) in interest rates. These and other factors could adversely affect
your investment.
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1, 5 and 10 years compare to those of the S&P 500 Composite Index,
which is a broad measure of market performance. The Fund's past performance is
not necessarily an indication of how it will perform in the future.
1999 10%
1998 19%
1997 33%
1996 22%
<PAGE>
1995 30%
1994 -2%
1993 16%
1992 6%
1991 24%
1990 -3%
During the 10-year period shown in the bar chart for Class A shares, the
highest return for a quarter was 16.00% (quarter ending 12/31/98) and the
lowest return for a quarter was -9.97% (quarter ending 9/30/90).
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown.
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year Past 5 years Past 10 years
================================================================================
Growth and Income Fund Class A 4.06% 20.94% 14.01%
Growth and Income Fund Class B 5.64% N/A N/A
================================================================================
S&P 500* 21.04% 28.55% 18.21%
================================================================================
The Fund commenced offering Class D shares on April 30, 1999. Prior to the date
of this prospectus, the Fund had not yet commenced offering Class C shares.
*The S&P 500(R) is the Standard & Poor's Composite Index of 500 Stocks, a widely
recognized, unmanaged index of common stock prices. The returns for the S&P 500
do not include any sales charges, fees or other expenses. The returns for the
Fund reflect the maximum applicable sales charges currently in effect.
THE DLJ WINTHROP SMALL COMPANY VALUE FUND
The DLJ Winthrop Small Company Value Fund's investment objective is a high level
of growth of capital. The Fund seeks to achieve its objective by investing in
common stock and other equity securities of "small cap" companies that appear to
be undervalued. Companies with market capitalizations of $2 billion or less at
the time of purchase are considered to be "small cap" companies.
This Fund's investment objective causes it to be riskier than other funds and
you could lose money. While the Fund seeks investments that provide a high level
of growth of capital, they may decline in value. You should not invest in this
Fund if your principal objective is assured income or capital preservation.
Investments in smaller companies often involve greater risks than investments in
larger, more established companies. Smaller companies may have less management
experience, fewer financial resources, and limited product diversification, all
of which may increase risk.
The frequency and trading volume for securities of smaller companies are
substantially less than for larger companies. This can result in greater and
more abrupt price fluctuations and can cause small cap stocks to be less liquid
than securities of larger companies. The Fund is also subject to risks that
affect equity securities markets in general, such as general economic conditions
and adverse changes (generally increases) in interest rates. These and other
factors could adversely affect your investment.
<PAGE>
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1, 5 and 10 years compare to those of the Russell 2000 Index, which
is a broad measure of market performance. The Fund's past performance is not
necessarily an indication of how it will perform in the future.
1999 1%
1998 -5%
1997 26%
1996 15%
1995 20%
1994 -1%
1993 22%
1992 18%
1991 51%
1990 -13%
During the 10 year period shown in the bar chart for Class A shares, the
highest return for a quarter was 17.81% (quarter ending 3/31/91) and the
lowest return for a quarter was -18.15% (quarter ending 9/30/98).
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown. Prior to the
date of this prospectus, the Fund had not yet commenced offering Class C
shares.
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year Past 5 years Past 10 years
================================================================================
Small Company Value Fund Class A -4.35% 9.65% 11.48%
Small Company Value Fund Class B -3.29% N/A N/A
================================================================================
Russell 2000* 21.26% 16.69% 13.40%
================================================================================
*The Russell 2000 Index is an unmanaged index of common stock prices and is
composed of the 2,000 smallest companies in the Russell 3000 Index. The Russell
3000 Index is composed of 3,000 of the largest U.S. companies by market
capitalization. The returns for the Russell 2000 Index do not include any sales
charges, fees or other expenses. The returns for the Fund reflect the maximum
applicable sales charges currently in effect.
THE DLJ WINTHROP FIXED INCOME FUND
The DLJ Winthrop Fixed Income Fund's investment objective is to provide as high
a level of total return as is consistent with capital preservation by investing
principally in debt securities, including, without limitation, convertible and
non-convertible debt securities of foreign and domestic companies, including
both well-known and established and new and lesser-known companies. The Fund
seeks to achieve its objective by investing primarily in a diversified portfolio
of high-grade intermediate-term corporate bonds and U.S. Government securities,
as well as in commercial paper and obligations issued or guaranteed by national
or state banks. In addition, the Adviser actively manages the maturities of the
securities in the
<PAGE>
portfolio in response to the Adviser's anticipation of the movement of interest
rates and relative yields. The Fund seeks to limit risk by selecting
investment-grade debt securities.
While the Fund seeks investments that will satisfy its investment objective, the
investments could decline in value and you could lose money. Concerns about an
issuer's ability to repay its borrowings or to pay interest will adversely
affect the value of its securities.
The Fund is subject to risks that affect the bond markets in general, such as
general economic conditions and adverse changes (generally increases) in
interest rates. As interest rates rise, absent other factors, bond prices and
the value of your investments will fall. The Fund is also subject to the risk
that, in seeking to enhance total return, the Adviser will incorrectly forecast
changes in interest rates or improperly assess the value of debt securities.
These and other factors could adversely affect your investment.
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1, 5 and 10 years compare to those of the Lehman Brothers
Government/Corporate Intermediate Bond Index, which is a broad measure of market
performance. The Fund's past performance is not necessarily an indication of how
it will perform in the future.
1999 -1%
1998 8%
1997 8%
1996 3%
1995 15%
1994 -4%
1993 10%
1992 7%
1991 14%
1990 9%
During the 10 year period shown in the bar chart for Class A shares, the
highest return for a quarter was 5.09% (quarter ending 12/31/91) and the
lowest return for a quarter was -2.88% (quarter ending 3/31/94).
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown.
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year Past 5 years Past 10 years
================================================================================
Fixed Income Fund Class A -5.38% 5.16% 6.24%
Fixed Income Fund Class B -5.35% N/A N/A
================================================================================
Lehman Index** 0.39% 7.10% 7.26%
================================================================================
The Fund commenced offering Class D shares on April 30, 1999. Prior to the date
of this prospectus, the Fund had not yet commenced offering Class C shares.
**The Lehman Brothers Government/Corporate Intermediate Bond Index is comprised
of securities in the Lehman Brothers Government/Corporate Bond Index that have
maturities of 5-10 years. The Lehman Brothers Government/Corporate Bond Index
includes the Lehman Brothers Government Bond Index and
<PAGE>
the Lehman Brothers Corporate Bond Index and does not include fees or expenses
in its calculation. The returns for the Fund reflect the maximum applicable
sales charges currently in effect.
THE DLJ WINTHROP MUNICIPAL TRUST FUND
The DLJ Winthrop Municipal Trust Fund's investment objective is to provide as
high a level of total return as is consistent with capital preservation by
investing principally in high-grade tax-exempt municipal securities. By
high-grade tax-exempt municipal securities, we mean securities rated Aaa, Aa, A
or MIG-1 by Moody's or AAA, AA, A or SP-1 by S&P. It is important to note that
unlike most other municipal bond funds, the Fund's objective is not to provide
current income that is exempt from federal and/or state income tax. The Fund
seeks to achieve its objective by investing primarily in a diversified portfolio
of high-grade, intermediate-term municipal securities. In addition, the Adviser
actively manages the maturities of the securities in the portfolio in response
to the Adviser's anticipation of the movement of interest rates and relative
yields. Certain investments are selected that the Adviser believes are
undervalued. The Fund attempts to limit risk by selecting investment-grade debt
securities and by maintaining an average maturity of between five and ten years.
While the Fund seeks investments that will satisfy its investment objective,
these investments could decline in value and you could lose money. Concerns
about an issuer's ability to repay its borrowings or to pay interest will
adversely affect the value of its securities. The Fund is also subject to the
risk that, in seeking to enhance total return, the Adviser will incorrectly
forecast changes in interest rates or improperly assess the value of municipal
securities. Like all bond funds, this Fund is subject to risks that affect the
bond markets in general, such as general economic conditions and adverse changes
(generally increases) in interest rates. As interest rates rise, absent other
factors, bond prices and the value of your investment will fall. The Fund is
also subject to risks of investing in municipal securities. These risks include
uncertainties regarding the securities' tax status, political and legislative
changes and the rights of their holders. These and other factors could adversely
affect your investment.
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1 and 5 years and from inception, compare to those of the Lehman
Brothers Seven Year Municipal Bond Index, which is a broad measure of market
performance. The Fund's past performance is not necessarily an indication of how
it will perform in the future.
1999 -1%
1998 5%
1997 8%
1996 4%
1995 12%
1994 -3%
During the 6 year period shown in the bar chart for Class A shares, the
highest return for a quarter was 4.52% (quarter ending 3/31/95) and the
lowest return for a quarter was -4.18% (quarter ending 3/31/94). 1994 was
the first full calendar year of operations.
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown. Prior to the
date of this prospectus, the Fund had not yet commenced offering Class C
shares.
<PAGE>
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year Past 5 years From inception on 7/28/93
================================================================================
Municipal Trust Fund Class A -6.10% 4.32% 3.22%
Municipal Trust Fund Class B -5.89% N/A N/A
================================================================================
LBSYMBI* -0.14% 6.35% 5.12%**
================================================================================
* The Lehman Brothers Seven Year Municipal Bond Index ("LBSYMBI") is comprised
of municipal securities having an average approximate maturity of seven years
and does not include fees or expenses in its calculation. The returns for the
Fund reflect the maximum applicable sales charges currently in effect.
** For comparative purposes the value of the index on 7/31/93 is used for the
beginning value on 7/28/93.
DLJ WINTHROP OPPORTUNITY FUNDS' RISK RETURN SUMMARY
THE DLJ WINTHROP DEVELOPING MARKETS FUND'S
The DLJ Winthrop Developing Markets Fund's investment objective is to provide
long-term growth by investing in common stocks and other equity securities of
companies from developing countries. The Fund seeks to achieve its objective by
investing in companies from the countries included in the Morgan Stanley Capital
Index ("MSCI") Emerging Markets Free Index that are identified by the Adviser as
being best positioned to take advantage of certain economic and political
factors. The Fund seeks to identify countries, and then the industries, where
economic and political factors are likely to produce above average growth. The
Fund uses a fundamental analysis on common stock in countries the Adviser
believes demonstrate a strong potential for expansion, a trend toward
modernizing production and high levels of economic growth. The Fund invests in
securities of issuers in at least three different developing countries. You
should not invest in this Fund if your principal objective is assured income or
capital preservation.
This Fund's investment objective causes it to be riskier than other Funds and
you could lose money. While the Fund seeks investments that provide a high level
of growth of capital, they may decline in value. The Fund invests primarily in
non-U.S. securities (securities of non-U.S. based issuers or issuers that do
business principally outside the United States) from issuers in developing
markets. Investments in non-U.S. securities present additional risks including
greater price volatility and a lack of liquidity. Investments in developing
markets present further risks because they tend to be smaller, less mature and
less stable than developed markets. The Fund is also subject to risks that
affect equity securities markets in general, such as general economic conditions
and adverse changes in interest and foreign exchange rates. These and other
factors could adversely affect your investment.
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1 year and from inception, compare to those of the MSCI Emerging
Markets Free Index, which is a broad measure of market performance. The Fund's
past performance is not necessarily an indication of how it will perform in the
future.
1999 69%
1998 -22%
1997 -6%
1996 4%
During the 4 year period shown in the bar chart for Class A shares, the
highest return for a quarter was 27.74% (quarter ending 12/31/99) and the
lowest return for a quarter -21.96% (quarter ending 6/30/98). 1996 was the
first full calendar year of operations.
The annual returns referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown. Prior to the
date of this prospectus, the Fund had not yet commenced offering Class C
shares.
<PAGE>
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year From Inception on 9/8/95
================================================================================
Developing Markets Fund Class A 59.11% 4.16%
Developing Markets Fund Class B 63.45% 4.78%
================================================================================
MSCI Emerging Markets Free Index* 66.41% 3.09%
================================================================================
* The MSCI Emerging Markets Free Index is an unmanaged index composed of a
sample of companies representative of the market structure of developing
countries worldwide. The index is the property of Morgan Stanley & Co.
Incorporated. The returns for the Index do not include any sales charges, fees
or other expenses. The returns for the Fund reflect the maximum applicable sales
charges.
THE DLJ WINTHROP INTERNATIONAL EQUITY FUND
The DLJ Winthrop International Equity Fund's investment objective is long-term
growth by investing in equity securities from established international markets.
The Fund seeks to achieve this objective by investing in a diversified portfolio
of investments that include companies from the countries of the MSCI Europe,
Australia and Far East Index (the "EAFE Index"), an unmanaged index of over
1,000 foreign stock prices. The Fund seeks to identify countries and industries
with favorable growth prospects. Once the countries have been selected, the
Adviser chooses the stocks and industries in each country. The Adviser employs a
comprehensive top-down approach to invest in industries in each country that
are, in the opinion of the Adviser, likely to do well and in stocks with
reasonable value, reliable earnings and high quality management.
Like any investment, an investment in the Fund is subject to risk and you could
lose money. While the Fund selects investments that the Adviser believes will
appreciate in value, those securities could decline in value and provide no
income. The Fund invests primarily in non-U.S. securities (securities of
non-U.S. based issuers or issuers that do business principally outside the
United States ). Investments in non-U.S. securities present additional risks
including greater price volatility and a lack of liquidity. The Fund is also
subject to risks that affect equity securities markets in general, such as
general economic conditions and adverse changes in interest and foreign exchange
rates. These and other factors could adversely affect your investment.
The following chart and table illustrate risk by showing the variability of the
Fund's returns by showing the rate of return from year to year and how annual
returns for 1 year and from inception compare to those of the MSCI-EAFE(R)
Index, which is a broad measure of market performance. The Fund's past
performance is not necessarily an indication of how it will perform in the
future.
1999 28%
1998 18%
1997 7%
1996 6%
<PAGE>
During the 4 year period shown in the bar chart for Class A shares, the
highest return for a quarter was 19.76% (quarter ending 12/31/99) and the
lowest return for a quarter was -15.46% (quarter ending 9/30/98). 1996 was
the first full calendar year of operations.
The annual returns, referenced in the bar chart are for the calendar years
ended December 31 and do not include sales charges. If sales charges were
included, the annual returns would be lower than those shown.
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year From inception 9/8/95
================================================================================
International Equity Fund Class A 20.57% 12.10%
International Equity Fund Class B 22.97% 12.81%
================================================================================
MSCI -EAFE* 27.30% 14.02%
================================================================================
The Fund commenced offering Class D shares on May 13, 1999. Prior to the date of
this prospectus, the Fund had not yet commenced offering Class C shares.
*The MSCI-EAFE(R) is an unmanaged index composed of a sample of companies
representative of the market structure of European and Pacific Basin Countries.
The index is the property of Morgan Stanley & Co. Incorporated. The returns for
the Index do not include any sales charges, fees or other expenses. The returns
for the Fund reflect the maximum applicable sales charges.
THE DLJ WINTHROP MUNICIPAL MONEY FUND
The DLJ Winthrop Municipal Money Fund's investment objective is maximum current
income, consistent with liquidity and safety of principal. The Fund seeks to
achieve this objective by investing in a diversified portfolio of municipal
securities that is intended to be exempt from Federal income taxes. The Fund
earns income at current money market rates, and its yield generally reflects
short-term interest rates which vary from day to day. Such municipal securities
will have varying lengths of maturities but will generally have remaining
maturities of one year or less. In general, securities with longer maturities
are more vulnerable to price changes, although they may provide higher yields.
Like any money market fund investment, this investment is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
The Fund seeks to preserve the value of your investment at $1.00 per share,
however, it is possible to lose money by investing in the Fund.
Because this Fund began operations in February, 1997, the first full calendar
year of performance was 1998. The Fund's past performance is not necessarily an
indication of how it will perform in the future.
1999 2%
1998 3%
<PAGE>
During the 2 year period shown in the bar chart, the highest return for a
quarter was 0.70% (quarter ending 6/30/98) and the lowest return for a
quarter was .53% (quarter ending 3/31/99).
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year From Inception on 2/24/97
================================================================================
Municipal Money Fund 2.44 % 2.67%
================================================================================
Seven Day Yield as of December 31, 1999 was 3.64%
THE DLJ WINTHROP U.S. GOVERNMENT MONEY FUND
The DLJ Winthrop U.S. Government Money Fund's investment objective is maximum
current income, consistent with liquidity and safety of principal. The Fund
seeks to achieve its objective by investing in a portfolio of U.S. Government
securities, including issues of the U.S. Treasury and other government agencies,
which generally have remaining maturities of one year or less and collateralized
repurchase agreements.
Like any money market fund investment, this investment is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. The Fund seeks to preserve the value of your investment at $1.00 per
share, however, it is possible to lose money by investing in the Fund. The Fund
earns income at current market rates, and its yield generally reflects
short-term interest rates, which vary from day to day.
Because this Fund began operations in February, 1997, the first full calendar
year of performance was 1998. The Fund's past performance is not necessarily an
indication of how it will perform in the future.
1999 4%
1998 5%
During the 2 year period shown in the bar chart, the highest return for a
quarter was 1.19% (quarter ending 9/30/98) and the lowest return for a
quarter was 1.00% (quarter ending 3/31/99).
================================================================================
Average Annual Total Returns
(for the periods ending
December 31, 1999) Past Year From Inception on 2/24/97
================================================================================
U.S. Government Money Fund 4.34% 4.60%
================================================================================
Seven Day Yield as of December 31, 1999 is 4.54%
THE DLJ WINTHROP HIGH INCOME FUND
The DLJ Winthrop High Income Fund's primary investment objective is to provide a
high level of current income and a secondary objective is capital appreciation.
The Fund seeks to achieve its objective by investing in fixed income securities
of U.S. issuers that are rated below investment-grade quality or unrated fixed
income securities deemed to be of comparable quality. Lower grade fixed income
securities are commonly known as "junk bonds".
<PAGE>
This investment objective causes it to be riskier than other Funds and you could
lose money. Investments in lower grade securities are subject to special risks,
including greater price volatility and a greater risk of loss of principal and
non-payment of interest. The market value of longer maturity debt securities,
like those held by the Fund, is more sensitive to interest rate changes than the
market value of shorter maturity debt securities. The Fund is not recommended
for investors whose principal objectives are assured income or capital
preservation. This Fund is designed for investors willing to assume additional
risk in return primarily for the potential for high current income and
secondarily capital appreciation.
Because this Fund began operations in March 1999 it does not have a full
calendar year of performance.
SUMMARY OF DLJ WINTHROP FUND EXPENSES
SHAREHOLDER TRANSACTION EXPENSES
This table describes the fees and expenses that you may pay if you buy and hold
shares of the DLJ Winthrop Funds.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
Fixed Income Funds* Equity Funds** Money
Funds***
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER FEES: Class A Class B Class C Class D Class A Class B Class C Class D
(These fees are paid (1) (2) (1) (2)
directly from your
investment.)
- --------------------------- -------------
Maximum sales charge 4.75% None None None 5.75% None None None None
(load) imposed on
purchases (as a
percentage of offering
price)
- --------------------------- -------------
Maximum sales charge None None None None None None None None None
(load) imposed on
reinvested dividends (as
a percentage of offering
price)
- --------------------------- -------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- --------------------------- -------------
Maximum deferred sales None 4% (3) 1% (4) None None 4% (3) 1% (4) None None
charge (as a percentage
of original purchase
price or redemption
proceeds, as applicable)
- --------------------------- -------------
Redemption Fees None None None None None None None None None
- --------------------------- -------------
Exchange Fee None None None None None None None None None
- --------------------------- ---------- ---------- --------- --------- ---------- ----------- --------- ------- -------------
</TABLE>
* Includes the Fixed Income Fund, Municipal Trust Fund and the High Income
Fund.
** Includes the Growth Fund, the Growth and Income Fund, the Small Company
Value Fund, the Developing Markets Fund, and the International Equity
Fund.
*** Includes the Municipal Money Fund and U.S. Government Money Fund.
(1) The maximum sales charge imposed is reduced for larger purchases.
Purchases of $1,000,000 or more are not subject to an initial sales charge
but may be subject to a 1% CDSC (Contingent Deferred Sales Charge) on
redemptions made within one year of purchase. See "Other Shareholder
Information."
(2) Class B shares of each Fund automatically convert to Class A shares after
eight years. The effect of the automatic conversion feature is reflected
in the Examples on page 15. See "Other Shareholder Information".
(3) 4% during the first year decreasing 1% annually to 0% after the fourth
year.
(4) 1% during the first year.
ANNUAL FUND OPERATING EXPENSES
These examples help you compare the cost of investing in the Funds with the cost
of investing in other mutual funds. They assume that you invest $10,000 in the
applicable Fund for the periods indicated and then sell all of your shares at
the end of those periods. The examples also assume that your investment has a 5%
return each year and that the Fund's operating expenses remain the same. For
those Funds that have Waived Fees below, only the After 1 Year Examples and the
first year in each of the other Examples reflect the Waived Fees. Other
expenses for Class C shares are estimates based on the expense ratio referenced
for the Funds' other classes. Although your actual costs may be higher or lower,
based on these assumptions your costs would be:
<TABLE>
<CAPTION>
Annual Fund Operating Expenses Examples
(expenses that are deducted from Fund assets)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Growth Fund Class A Class B Class C Class D Examples+ Class A Class B* Class B** Class C * Class C** Class D
Management Fee .67% .67% .67% .67% After 1 Year $693 $596 $196 $296 $196 $95
Distribution .30% 1.00 % 1.00% .00% After 3 Years $943 $806 $606 $606 $606 $296
(12b-1) and
Service Fees (a)
Other Expenses .26 % .26 % .26% .26% After 5 Years $1,212 $1,042 $1,042 $1,042 $1,042 $515
Total Annual 1.23% 1.93% 1.93% .93% After 10 Years $1,978 $2,072 $2,072 $2,254 $2,254 $1,143
Fund Operating
Expenses
- ------------------------------------------------------------------------------------------------------------------------------------
Growth and Class A Class B Class C Class D Examples+ Class A Class B* Class B ** Class C * Class C** Class D
Income Fund
Management Fee .58% .58% .58% .58% After 1 Year $682 $584 $184 $284 $184 $83
Distribution .30% 1.00% 1.00% .00% After 3 Years $908 $769 $569 $569 $569 $259
(12b-1) and
Service Fees (a)
Other Expenses 23% .23% .23% .23% After 5 Years $1,151 $980 $980 $980 $980 $450
Total Annual 1.11% 1.81% 1.81% .81% After 10 Years $1,849 $1,943 $1,943 $2,127 $2,127 $1,002
Fund Operating
Expenses
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Small Company Class A Class B Class C Examples+ Class A Class B* Class B** Class C* Class C**
Value Fund
Management Fee .79% .79% .79% After 1 Year $706 $610 $210 $310 $210
Distribution .30% 1.00% 1.00% After 3 Years $984 $849 $649 $649 $649
(12b-1) and
Service Fees (a)
Other Expenses .28% .28% .28% After 5 Years $1,282 $1,114 $1,114 $1,114 $1,114
Total Annual 1.37% 2.07% 2.07% After 10 Years $2,127 $2,221 $2,221 $2,400 $2,400
Fund Operating
Expenses
- ------------------------------------------------------------------------------------------------------------------------------------
Fixed Income Class A Class B Class C Class D Examples+ Class A Class B* Class B** Class C* Class C ** Class D
Fund
Management Fee .63% .63% .63% .63% After 1 Year $572 $573 $173 $273 $173 $72
Distribution .30% 1.00% 1.00% .00% After 3 Years $807 $765 $565 $565 $565 $254
(12b-1) and
Service Fees (a)
Other Expenses .21% .21% .21% .21% After 5 Years $1,060 $982 $982 $982 $982 $452
Total Annual 1.14% 1.84% 1.84% .84% After 10 Years $1,783 $1,964 $1,964 $2,147 $2,147 $1,024
Fund Operating
Expenses
Waived Fees (d) (.14%) (.14%) (.14%) (.14%)
Total Expenses 1.00% 1.70% 1.70% .70%
Less Waived Fees
- ------------------------------------------------------------------------------------------------------------------------------------
Municipal Class A Class B Class C Examples+ Class A Class B* Class B** Class C * Class C **
Trust Fund
Management Fee .63% .63% .63% After 1 Year $572 $573 $173 $273 $173
Distribution .30% 1.00% 1.00% After 3 Years $864 $824 $624 $624 $624
(12b-1) and
Service Fees(a)
Other Expenses .49% .49% .49% After 5 Years $1,176 $1,101 $1,101 $1,101 $1,101
Total Annual 1.42% 2.12% 2.12% After 10 Years $2,062 $2,240 $2,240 $2,419 $2,419
Fund Operating
Expenses
Waived Fees (e) (.42%) (.42%) (.42%)
Total Expenses 1.00% 1.70% 1.70%
Less Waived Fees
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Developing Class A Class B Class C Examples+ Class A Class B* Class B** Class C * Class C **
Markets Fund
Management Fees 1.25% 1.25% 1.25% After 1 Year $781 $693 $293 $393 $293
Distribution .25% 1.00% 1.00% After 3 Years $1,357 $1,250 $1,050 $1,050 $1,050
(12b-1) and
Service Fees (a)
Other Expenses 1.41% 1.41% 1.41% After 5 Years $1,957 $1,828 $1,828 $1,828 $1,828
Total Annual 2.91% 3.66% 3.66% After 10 Years $3,571 $3,701 $3,701 $3,866 $3,866
Fund Operating
Expense (b)
Waived Fees (f) (.76%) (.76%) (.76%)
Total Expenses 2.15% 2.90% 2.90%
Less Waived Fees
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
International Class A Class B Class C Class D Examples+ Class A Class B* Class B** Class C * Class C** Class D
Equity Fund
Management Fees 1.25% 1.25% 1.25% 1.25% After 1 Year $781 $693 $293 $393 $293 $193
Distribution
(12b-1) and After 3
Service Fees (a) .25% 1.00% 1.00% .00% Years $1,217 $1,106 $906 $906 $906 $605
After 5
Other Expenses .69% .69% .69% .69% Years $1,679 $1,544 $1,544 $1,544 $1,544 $1,043
Total Annual
Fund Operating After 10
Expenses (b) 2.19% 2.94% 2.94% 1.94% Years $2,951 $3,082 $3,082 $3,258 $3,258 $2,261
Waived Fees (g) (.04%) (.04%) (.04%) (.04%)
Total Expenses
Less Waived Fees 2.15% 2.90% 2.90% 1.90%
- ------------------------------------------------------------------------------------------------------------------------------------
Municipal Money
Fund Examples++
Management Fees .40% After 1 Year $92
Distribution
(12b-1) and After 3
Service Fees(c) .25% Years $317
Other Expenses .39% After 5
Total Annual Years $560
Fund Operating After 10
Expenses 1.04% Years $1,258
Waived Fees (h) (.14%)
Total Expenses
Less Waived Fees .90%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Government
Money Fund Examples++
Management Fees .40% After 1 Year $92
Distribution
(12b-1) and After 3
Service Fees(c) .25% Years $328
Other Expenses .44% After 5
Total Annual Years $582
Fund Operating After 10
Expenses 1.09% Years $1,312
Waived Fees (i) (.19%)
Total Expenses
Less Waived Fees .90%
- ------------------------------------------------------------------------------------------------------------------------------------
High Income Fund Class A Class B Class C Class D Examples+ Class A Class B* Class B** Class C* Class C** Class D
Management Fees .70% .70% .70% .70% After 1 Year $582 $588 $188 $288 $188 $87
Distribution .25% 1.00% 1.00% .00% After 3
(12b-1) and Years $1,095 $1,076 $876 $876 $876 $575
Service Fees(a) After 5
Years $1,634 $1,589 $1,589 $1,589 $1,589 $1,090
After 10
Years $3,102 $3,306 $3,306 $3,479 $3,479 $2,504
Other Expenses 1.58% 1.58% 1.58% 1.58%
Total Annual
Fund Operating
Expenses 2.53% 3.28% 3.28% 2.28%
Waived Fees (j) (1.43%) (1.43%) (1.43%) (1.43%)
Total Expenses
Less Waived Fees 1.10% 1.85% 1.85% .85%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Assumes reinvestment of all dividends and redemption at end of period.
** Assumes reinvestment of all dividends and no redemption at end of period.
+ Ten year figures assume conversion of Class B shares to Class A shares at
the end of the eighth year following the date of purchase.
++ Shares purchased directly into a Money Fund will not be subject to a CDSC
and therefore expenses paid will remain unaffected by redemption.
(a) The Fund has adopted a Rule 12b-1 plan for the indicated classes of shares
that allows the Fund to pay distribution fees for the sale and
distribution of those classes of shares out of the assets applicable to
those classes. Because these fees are paid out over time, they will
increase the cost of your investment and may cost you more than paying
other types of sales charges. A portion of the 12b-1 fee represents an
asset-based sales charge.
(b) The expense ratios for each class of shares of the Developing Markets Fund
and the International Equity Fund are higher than those paid by most other
investment companies, but DLJ Asset Management Group, Inc. (as Adviser)
and AXA Investment Managers GS Ltd. (as subadviser)
<PAGE>
believe the fees are comparable to those paid by investment companies of
similar investment orientation.
(c) The maximum allowable amount payable for distributing shares is .40 of 1%
of the average daily net assets of each Money Fund. The Board of Trustees
has currently limited the amount payable to .25 of 1% of the average daily
not assets of each Money Fund.
(d) The Adviser has undertaken, in writing, to limit Total Expenses of the
Fixed Income Fund to .70% and 1.00% per year for the Fund's Class D and
Class A shares, respectively and 1.70% for the Fund's Class B and Class C
shares. This arrangement will remain in place at least until October 31,
2000.
(e) The Adviser has undertaken, in writing, to limit Total Expenses of the
Municipal Trust Fund to 1.00% per year for the Fund's Class A shares and
1.70% for the Fund's Class B and Class C shares. This arrangement will
remain in place at least until October 31, 2000.
(f) The Adviser has undertaken, in writing, to limit Total Expenses of the
Developing Markets Fund to 2.15% per year for the Fund's Class A shares
and 2.90% for the Fund's, Class B and Class C shares. This arrangement
will remain in place at least until October 31, 2000.
(g) The Adviser has undertaken, in writing, to limit Total Expenses of the
International Equity Fund to 1.90% and 2.15% per year for the Fund's Class
D and Class A shares respectively and 2.90% for the Fund's Class B and
Class C shares. This arrangement will remain in place at least until
October 31, 2000.
(h) The Adviser has undertaken, in writing, to limit Total Expenses of the
Municipal Money Fund to .90% per year. This arrangement will remain in
place at least until October 31, 2000.
(i) The Adviser has undertaken, in writing, to limit Total Expenses of the
U.S. Government Money Fund to .90% per year. This arrangement will remain
in place at least until October 31, 2000.
(j) The Adviser has undertaken, in writing, to limit Total Expenses, of the
High Income Fund to .85% and 1.10% per year for the Fund's Class D and
Class A shares, respectively, and 1.85% for the Fund's Class B and Class C
shares. This arrangement will remain in place at least until October 31,
2000.
PURCHASE INFORMATION
Shares of the DLJ Winthrop Municipal Money Fund and the DLJ Winthrop U.S.
Government Money Fund (the "Money Funds") or Class A, Class B or Class C shares
of the other Funds may be purchased directly by using the Share Purchase
Application found in this Prospectus, or through Donaldson, Lufkin & Jenrette
Securities Corporation, the Funds' distributor, or by contacting your securities
dealer.
The minimum initial investment in each Fund is $250. The minimum for additional
investments is $25. These minimums are waived for certain types of accounts.
Share certificates will not be issued for full or fractional shares of the
Funds. Further information can be obtained from DLJ Winthrop at the address and
telephone number shown on the back cover of this Prospectus. See "How to Buy and
Sell Shares" and "Other Shareholder Services."
The Funds, except the Money Funds, offer Class A, Class B and Class C shares.
Class A shares may be purchased at the net asset value per share of the Fund
plus an initial sales charge imposed at the time of purchase and may be subject
to a contingent deferred sales charge ("CDSC") in cases where the initial sales
charge was not applied because of the size of the purchase. Class B shares may
be purchased at the net
<PAGE>
asset value per share, but are subject to a CDSC upon redemption. The CDSC
applicable to Class B shares declines from 4% for redemptions made during the
first year of purchase to zero after four years. Class C shares may be purchased
at the net asset value per share, but are subject to a 1% CDSC if redeemed
within the first year of purchase. The Growth Fund, Growth and Income Fund,
Fixed Income Fund, High Income Fund and the International Equity Fund also offer
Class D shares. Class D shares are offered without any initial sales charge or
CDSC to employees of Donaldson, Lufkin & Jenrette Inc. ("DLJ, Inc.") and its
subsidiaries that are eligible to participate in the DLJ 401(k) Retirement
Savings Plan. These employees should contact the DLJ 401(k) Hotline at
1-877-401k-DLJ concerning how to purchase Class D shares. See "How to Buy and
Sell Shares."
Shares of the Money Funds may be purchased at a price equal to the net asset
value per share of each Money Fund, which is expected to be $1.00 per share. See
"Net Asset Value" in the sidebar included on this page.
The DLJ Winthrop Opportunity Funds and the DLJ Winthrop Focus Funds are
different legal entities and are separately offering their securities through
this Prospectus. Based on the advise of counsel, the Funds believe that the
potential liability of each Fund with respect to the disclosure in this
Prospectus extends only to the disclosure relating to that Fund.
[side bar]
Net Asset Value:
Net asset value per share (or "NAV") is determined separately for each class by
taking the total assets of each class of a Fund and subtracting its total
liabilities and then dividing the difference by the total number of shares
outstanding in each class.
The NAV is determined at the close of the New York Stock Exchange each day that
the New York Stock Exchange is open for trading. The price at which a purchase
or redemption is effected is based on the next calculation of NAV after the
order is placed.
For the Money Funds, the NAV is expected to be maintained at a constant $1.00
per share, although this price is not guaranteed.
For purposes of computing NAV, the securities in each Money Fund's portfolio are
valued at amortized cost, which minimizes the effect of changes in a security's
market value and helps maintain a stable $1.00 per share price.
In calculating the NAV of the DLJ Winthrop Funds, except the Money Funds, each
Fund's investments are valued at their current market value determined on the
basis of market quotations or, if such quotations are not readily available,
such other method as the Trustees of the applicable Fund believe in good faith
would accurately reflect their fair value.
[side bar]
The investment objectives and policies of each Fund are set forth below. There
can be, of course, no assurance that any Fund will achieve its investment
objective. The Funds' investment objectives are fundamental policies that cannot
be changed without the approval of the shareholders of the applicable Fund. The
Board of Trustees of a Fund may change non-fundamental policies without
shareholder approval.
DLJ WINTHROP FOCUS FUNDS' INVESTMENT OBJECTIVES AND POLICIES
DLJ WINTHROP GROWTH FUND
<PAGE>
Goal: The investment objective of the DLJ Winthrop Growth Fund is long-term
capital appreciation. Investments are made based on their potential for
long-term capital appreciation. The Growth Fund may make an investment to earn
income when, in the opinion of the Adviser, such an investment will not
compromise the Growth Fund's investment objective.
Strategy: The Growth Fund invests in common stock, securities convertible into
common stock and other equity securities (e.g., preferred stock and interests in
master limited partnerships). It invests primarily in well-known and established
companies (generally, companies in operation for more than three years). The
Fund may occasionally invest in new and unseasoned companies which, in the
opinion of the Adviser, have the potential for long-term capital appreciation.
The Adviser applies extensive research that has been conducted primarily by
research analysts employed by DLJ on the growth prospects of stocks that are
considered for the Fund's portfolio. Target companies normally have market
capitalizations of at least $1 billion at the time of purchase. Generally, the
Adviser attempts to identify companies with growth rates that will exceed that
of the S&P 500 Index. The Growth Fund is "sector neutral." This means that its
investments are allocated to industries in proportion to the sector allocation
of the S&P 500 Index, with the exception of the electric and the gas utilities
sectors. Other factors considered in the selection of securities include the
economic and political outlook, the value of a particular security relative to
another security, trends in the determinants of corporate profits, and
management capability and practices. See "Risks for the Growth Fund and the
Growth and Income Fund" on page 18.
Investments: Under normal circumstances, the Growth Fund invests at least 65% of
its total assets in equity securities of companies that the Adviser believes
have above-average long-term capital appreciation potential. For temporary
defensive purposes, the Growth Fund may invest in investment-grade short-term
fixed-income securities, enter into repurchase agreements and hold cash. A
temporary defensive position could affect the Fund's ability to achieve its
investment objective. In addition, the Fund may invest in equity securities
selected on a basis other than the potential for long-term capital appreciation.
The Fund may invest up to 35% of the value of its assets in investment-grade
fixed-income securities, including bonds, debentures, notes, asset and
mortgage-backed securities and money market instruments such as commercial paper
and bankers'-acceptances and other financial instruments. The Fund may invest in
both listed and unlisted securities and may also:
o invest up to 10% of the value of its total assets in non-U.S. securities;
o invest no more than 10% of its net assets in restricted securities or
other instruments with no ready market;
o invest up to 5% of its total assets in warrants; and
o attempt to minimize the effect of a market decline on the value of its
securities, subject to market conditions, by writing covered call options
on securities or stock indices. See "Additional Information on Investment
Policies and Risks."
[side bar]
Risks for the Growth Fund and the Growth and Income Fund:
Like any investment, an investment in the Growth Fund or Growth and Income Fund
is subject to risk and you could lose money. While the Funds seek investments
that will appreciate in value and/or provide income, the value of the securities
could decline and provide no income.
The Funds are subject to risks that affect equity securities markets in general,
such as general economic conditions and adverse changes in interest rates
(generally increases). If the value of equity markets in general declines, you
can expect the value of your investment in the Funds to decline, possibly to a
greater extent than the decline in equity markets generally.
The Growth Fund may invest in new and unseasoned companies. Stocks of these
companies tend to be more volatile than stocks of larger and more established
companies. In addition, because stocks are selected on the basis of their
appreciation potential, they tend to be more risky than many investments that
provide current income.
<PAGE>
The Growth and Income Fund may invest in debt securities. Debt securities are
subject to risks that the issuer will not repay its borrowings or pay interest.
They are also subject to the risk of declines in value because of increases in
interest rates and decreases in the credit quality of the issuer.
The Growth Fund and the Growth and Income Fund may each invest in unlisted
securities. Investments in unlisted securities may be less liquid and more
volatile than investments in listed securities and could result in losses to the
Funds if they had to be sold quickly.
The Growth Fund and the Growth and Income Fund may each invest in non-U.S.
securities. Non-U.S. securities carry the same risks as securities of U.S.
companies and the added risks of being traded in less liquid markets than U.S.
securities. Non-U.S. securities are also issued by companies that are not
subject to U.S. reporting requirements and involve political systems, economies
and markets that may not be as developed as in the U.S. See "Additional
Information on Investment Policies and Risks".
[end side bar]
DLJ WINTHROP GROWTH AND INCOME FUND
Goal: The investment objective of the DLJ Winthrop Growth and Income Fund is
long-term capital appreciation and continuity of income.
Strategy: The Growth and Income Fund pursues its investment objective by
investing principally in dividend-paying common stock and by diversifying its
investments among different industries and companies. Securities are selected
based on the Adviser's evaluation of their investment merit and their potential
for appreciation in value and/or income. The selection of securities on the
basis of their capital appreciation or income potential does not ensure against
possible loss in value.
Investments: The Growth and Income Fund invests in common stock, preferred stock
and securities convertible into common stock. The Growth and Income Fund may
invest in debt securities that are of investment-grade quality at the time of
purchase (including bonds, debentures, notes and asset and mortgage-backed
securities), U.S. government securities, municipal securities (including general
and special obligation securities and industrial revenue bonds) and money market
instruments. See "Additional Information on Investment Policies and Risks--
Mortgage and Asset-Backed Securities" and "Investment-Grade Debt Securities."
There is no fixed proportion of the Growth and Income Fund's assets that must be
invested in particular types of securities. The percentage of assets invested in
various types of securities may be changed from time to time by the Adviser.
The Growth and Income Fund invests in both listed and unlisted securities. The
Growth and Income Fund may invest in non-U.S. securities and restricted
securities. To minimize the effect of a market decline in the value of its
securities, the Fund may, depending on market conditions, write covered call
options on securities or stock indices. The Fund may invest up to 10% of its
assets in non-U.S. securities and up to 10% of its assets in restricted
securities. For additional information on the use, risks and costs of the above
referenced policies and practices, see "Additional Information on Investment
Policies and Risks."
DLJ WINTHROP SMALL COMPANY VALUE FUND
Goal: The investment objective of the DLJ Winthrop Small Company Value Fund is a
high level of growth of capital. The Small Company Value Fund is not intended
for investors whose principal objective is assured income or preservation of
capital.
Strategy: The Small Company Value Fund invests primarily in common stock and may
also invest in securities convertible into common stock, preferred stock, other
equity securities, bonds or other debt securities as described below. Under
normal market conditions, at least 65% of the Fund's assets are invested in
equity securities of small market capitalization companies. Small cap companies,
for purposes
<PAGE>
of this Fund, are considered to be companies with market capitalizations of $2
billion or less at the time of purchase. If the market capitalization of a small
cap company in which the Fund has invested increases to a level above $2
billion, the investment adviser will continue to hold the securities of that
company until the investment adviser determines that the company no longer has
growth potential.
Investments: The Small Company Value Fund pursues its investment objective by
employing a value-oriented investment approach. This means that the Adviser
seeks securities that appear to be underpriced. The Adviser looks for stocks
issued by companies with proven management, consistent earnings, sound finances
and strong potential for market growth. By investing in such companies, the
Small Company Value Fund tries to enhance its potential for appreciation and
limit the risk of decline in the value of its portfolio. The Small Company Value
Fund focuses on the fundamentals of each small-cap company instead of trying to
anticipate what changes might occur in the stock market, the economy, or the
political environment. This approach differs from that used by many other funds
investing in small-cap company stocks. Those other funds often buy stocks of
companies they believe will have above-average earnings growth, based on
anticipated future developments. In contrast, the Small Company Value Fund's
securities are generally selected with the belief that they are currently
undervalued based on existing conditions and that their earning power or
franchise value does not appear to be reflected in their current stock price. To
further reduce risk, the Small Company Value Fund diversifies its holdings among
many companies and industries. The Adviser also considers whether a company has
an established presence in its industry, a product or market niche and whether
management owns a significant stake in the company.
The Small Company Value Fund may also invest in special situation companies. A
special situation company is a company whose value may increase within a
reasonable period of time solely by reason of a development particularly or
uniquely applicable to that company. The securities of these companies may be
affected by particular developments unrelated to business conditions generally.
These investments may fluctuate without relation to general market trends. In
general, the principal risk associated with investing in special situation
companies is the potential decline in the value of these securities likely to
occur if the anticipated development fails to take place. Examples of special
situation companies are companies that are being reorganized or merged, have
unusual new products, enjoy particular tax advantages, or acquire new
management.
The Small Company Value Fund invests primarily in common stock. It may also
invest in securities convertible into common stock, preferred stock,
investment-grade debt securities (including bonds, debentures, notes, asset and
mortgage-backed securities), U.S. Government Securities, municipal securities
(including general and special obligation securities and industrial revenue
bonds), money market instruments (such as commercial paper and bankers'
acceptances) and other financial instruments.
The Small Company Value Fund may also invest in unlisted securities and
securities traded in the over-the-counter markets. The Small Company Value Fund
may allocate a larger percentage of its assets to unlisted securities than would
a typical large company mutual fund. The Small Company Value Fund may also:
o purchase or sell options on securities and on indices to seek to enhance
return or hedge its portfolio;
o purchase or sell financial futures contracts and options thereon for
hedging and risk management purposes;
o invest up to 20% of total assets in non-U.S.securities;
o invest up to 5% of total assets in rights or warrants; and
o invest not more than 10% of net assets in instruments having no ready
market.
However, the Fund does not invest in restricted securities.
[sidebar]
Risks for the Small Company Value Fund:
The investment objective for the Small Company Value Fund causes it to be
riskier than other funds and you could lose money. While it seeks investments
that will provide a high level of growth of capital, they may decline in value.
You should not invest in the Small Company Value Fund if your principal
objective
<PAGE>
is assured income or capital preservation. While smaller companies generally
have the potential for rapid growth, they often involve greater risks than
investments in larger, more established companies. Small companies may have less
management experience, fewer financial resources, and limited product
diversification.
In addition, in many instances the frequency and trading volume for securities
of smaller companies are substantially less than those of larger companies,
causing such securities to be subject to greater and more abrupt price
fluctuations and to be less liquid than securities of larger companies. When
making large sales of portfolio securities, it may be necessary for the Small
Company Value Fund to sell such securities at discounts from quoted prices or to
execute a series of small sales over an extended period of time. These factors
cause an investment in the Small Company Value Fund to be riskier than an
investment in a typical "large company" mutual fund.
The Small Company Value Fund also is subject to risks that affect equity
securities markets in general, such as general economic conditions and adverse
changes in interest rates. These factors also could adversely affect an
investment in the Fund. If the value of equity markets in general declines, the
value of your investment in the Small Company Value Fund could also decline,
possibly to a greater extent than the decline in equity markets generally.
The Small Company Value Fund may invest in various types of debt securities.
Debt securities are subject to the risk that the issuer will not repay its
borrowings or pay interest. They are also subject to the risk of declines in
value because of increases in interest rates and decreases in the perceived
credit quality of the issuer.
The Fund may also invest in unlisted securities. Investments in unlisted
securities may be less liquid and more volatile than investments in listed
securities and could result in losses if they had to be sold quickly.
The Fund may also invest in non-U.S. securities. Not only do non-U.S. securities
carry the same risks as securities of U.S. companies, they also have the added
risks of generally being traded in less liquid markets than U.S. securities,
involve political systems, economies and markets that may not be as developed as
in the U.S. and may be issued by companies that are not subject to reporting
requirements that are as rigorous as those imposed on U.S. issuers.
The Fund also may invest in options, warrants and financial futures contracts.
Selecting options, warrants and financial futures contracts involves
determinations as to how a particular security, index, interest rate, or
currency will change. If the Adviser is wrong in its prediction, the Fund could
lose money. In addition, such instruments may not be available, or if available,
may be too expensive to utilize. See "Additional Information on Investment
Policies and Risks".
[end sidebar]
DLJ WINTHROP FIXED INCOME FUND
Goal: The investment objective of the DLJ Winthrop Fixed Income Fund is to
provide as high a level of total return as is consistent with capital
preservation by investing principally in debt securities, including, without
limitation, convertible and nonconvertible debt securities of domestic and
foreign companies, including both well-known and established and new and
lesser-known companies. Total return means the sum of net investment income (if
any) and realized and unrealized gains less losses. Capital preservation means
minimizing the risk of capital loss in a period of falling prices (rising
interest rates) for debt securities.
Strategy: The Fund invests in and holds debt securities that the Adviser
believes will maximize total return at a level consistent with capital
preservation. The average maturity of the Fund's portfolio is adjusted based on
the Adviser's assessment of relative yields on debt securities and expectations
of future interest rate patterns.
<PAGE>
A change in the price of a debt security generally is inversely related to
market interest rates. This means that the value of the Fund's investments will
tend to decrease during periods of rising interest rates and to increase during
periods of falling rates. In general, as the average maturity of the portfolio
increases, so does the potential volatility in share price. As a matter of
fundamental policy, the Fund will invest at least 80% of the value of its total
assets in debt securities. In normal circumstances, the Fixed Income Fund
invests at least 65% of the value of its total assets in fixed income
securities. However, the Fund may hold cash and short-term fixed income
securities and may enter into repurchase agreements for temporary defensive
purposes as determined by the Adviser without regard to the above limits. A
temporary defensive position could affect the Fund's ability to achieve its
investment objective.
Investments: The Fixed Income Fund may invest in bonds, including municipal
bonds (taxable and tax-exempt) and other debt securities rated Aaa, Aa, A or
MIG-1 by Moody's Investors Service, Inc. ("Moody's"), or AAA, AA, A or SP-1 by
Standard & Poor's Ratings Group ("S&P"), U.S. Government Securities, obligations
issued or guaranteed by national or state bank holding companies, and commercial
paper rated Prime-1 by Moody's or A-1+ or A-1 by S&P.
The Fixed Income Fund may also invest not more than 25% of its total assets in
lower-rated debt securities that are not rated below BBB or SP-2 by S&P or Baa
or MIG-2 by Moody's to the extent the Adviser views such investments as
consistent with this fund's investment objective. See "Additional Information on
Investment Policies and Risks" for a description of securities rated BBB by S&P
and Baa by Moody's. The Fixed Income Fund may enter into repurchase agreements,
terminable within seven days or less, involving U.S. Treasury securities, with
member banks of the Federal Reserve System or primary dealers in U.S. Government
Securities. The Fixed Income Fund may invest up to 10% of its assets in
restricted securities and in instruments having no ready market value.
[side bar]
Risks for the Fixed Income Fund and Municipal Trust Fund:
While these Funds seek investments that will satisfy their investment
objectives, the Funds' investments could decline in value and you could lose
money. Concerns about an issuer's ability to repay its borrowings or to pay
interest will adversely affect the value of its securities. The Funds' Adviser
seeks to limit this risk generally by selecting higher-quality debt securities.
In addition, the Funds are subject to risks that affect the bond markets in
general, such as general economic conditions and adverse changes (generally
increases) in interest rates.
Each Fund may invest in unlisted securities. Unlisted securities may be less
liquid and more volatile than listed securities and could result in losses if
they had to be sold quickly. The Municipal Trust Fund is also subject to risks
of investing in municipal securities. These risks include uncertainties
regarding the tax status of a particular security, political and legislative
changes and the rights of their holders. These factors could adversely affect
your investment.
[end of side bar]
[side bar]
High Quality Ratings are Aaa, Aa, A or MIG-1 by Moody's , or AAA, AA, A or SP-1
by S&P.
[end of side bar]
DLJ WINTHROP MUNICIPAL TRUST FUND
Goal: The investment objective of the DLJ Winthrop Municipal Trust Fund is to
provide as high a level of total return as is consistent with capital
preservation by investing principally in high-grade tax-exempt municipal
securities. This investment objective, unlike that of most other municipal bond
funds, is not to provide current income exempt from federal and/or state income
tax. Total return means the sum of net investment income and capital gains less
capital losses. The Fund intends to distribute annually its net
<PAGE>
capital gains. Such distributions, if any, will be taxable to a shareholder as
capital gain. See "Dividend and Distribution Information" and "Taxes."
Strategy: The Municipal Trust Fund attempts to maximize total return by actively
managing the maturities of the bonds in its portfolio to reflect the Adviser's
assessment of anticipated interest rate movements and relative yields. The
Municipal Trust Fund currently maintains an average maturity of between 5 and 10
years in order to help reduce the interest rate risk associated with investing
in long-term bonds. However, the Fund may adjust this average maturity as the
Adviser's views on interest rate movements change, shortening maturities in
periods of rising interest rates and lengthening maturities in periods of
falling interest rates. The Fund attempts to supplement total return by
identifying and purchasing undervalued municipal securities.
As with any fixed income investment, the success of these strategies depends
upon the Adviser's ability to accurately forecast changes in interest rates and
to assess the value of municipal securities. You should be aware that there are
no assurances that the Fund's investment strategies will be successful. See
"Risks for the Fixed Income Fund and the Municipal Trust Fund" on page 22.
Investments: The Municipal Trust Fund seeks to achieve its objective by
investing primarily in a diversified portfolio of high-grade, intermediate-term
municipal securities. Municipal securities fall into two principal classes:
bonds and notes, both of which may have fixed, variable or floating rates of
interest. The Fund invests in tax-exempt municipal bonds and notes which are
rated Aaa, Aa, A or MIG-1 by Moody's or AAA, AA, A or SP-1 by S&P. The Fund may
also invest up to 25% of its total assets in lower-rated municipal securities to
the extent the Adviser views such investments as consistent with this Fund's
investment objective. See "Additional Information on Investment Policies and
Risks-- Investment-Grade Debt Securities" for a description of securities rated
BBB by S&P and Baa by Moody's. The Fund may also invest in unrated municipal
securities when the Adviser believes they are of comparable quality to that of
rated securities and are consistent with the Fund's objective and policies.
Because a change in the market value of a debt security generally is inversely
related to market interest rates, the market value of the Municipal Trust Fund's
investments will tend to decrease during periods of rising interest rates and to
increase during periods of falling rates. In general, as the average maturity of
the portfolio increases, so does the potential volatility in share price.
Fluctuations in market value of the Municipal Trust Fund's portfolio resulting
from fluctuations in interest rates will generally be greater at times when the
average maturity of the Municipal Trust Fund's portfolio is longer.
The Municipal Trust Fund may enter into repurchase agreements terminable within
seven days or less. The Fund may also invest in restricted securities, in
instruments having no ready market and municipal bonds that are subject to the
alternative minimum tax. The Municipal Trust Fund reserves the right to hold
cash and short-term fixed income securities and to enter into repurchase
agreements as necessary for temporary defensive or emergency purposes as
determined by the Adviser, without regard for the above limitation. A temporary
defensive position could affect the Fund's ability to achieve its investment
objective. Dividends of the Municipal Trust Fund will consist of income exempt
from federal income tax, income subject to the federal alternative minimum tax
("AMT"), and taxable ordinary income and capital gains. See "Dividend and
Distribution Information" and "Taxes."
DLJ WINTHROP OPPORTUNITY FUNDS'
INVESTMENT OBJECTIVES AND POLICIES
THE INTERNATIONAL FUNDS
DLJ WINTHROP DEVELOPING MARKETS FUND
<PAGE>
Goal: The investment objective of the DLJ Winthrop Developing Markets Fund is
long-term growth of capital by investing primarily in common stocks and other
equity securities in developing countries. Under normal market conditions, the
Fund invests at least 65% of its assets in equity securities of developing
countries.
Strategy: The Fund seeks to identify those countries and industries where
economic and political factors are likely to produce above average growth rates.
The Fund seeks to invest in those companies and in such industries and countries
that are best positioned and managed to take advantage of these economic and
political factors. The assets of the Fund ordinarily will be invested in the
securities of issuers in at least three different developing countries.
Investments: Equity securities include common and preferred stock, warrants,
rights or options that are convertible into common stock, debt securities that
are convertible into common stock, depository receipts for those securities and
other classes of stock that may exist. The Fund may purchase non-U.S. securities
in the form of sponsored or unsponsored depository receipts or other securities
restricted or otherwise representing underlying shares of non-U.S. issuers. The
Fund may purchase a limited amount of illiquid securities. The Fund may enter
into forward foreign currency exchange contracts to attempt to protect the value
of its assets against future changes in the level of currency exchange rates.
The Fund may purchase and sell financial futures contracts and options thereon
which are traded on a commodities exchange or board of trade for certain
hedging, return enhancement and risk management purposes. The Fund may purchase
and sell financial futures contracts and related options, without limitation,
for bona fide hedging purposes. Subject to the foregoing, the value of all
financial futures contracts sold will not exceed the total market value of the
Fund's portfolio.
As used in this Prospectus, a company in a developing country is an entity for
which either the principal securities trading market is in a developing country,
it is organized under the laws in a developing country or it has its principal
office in a developing country. The Fund invests primarily in countries
represented within the MSCI Emerging Markets Free Index. Those countries
currently include Argentina, Brazil, Chile, China, Colombia, Czech Republic,
Egypt, Greece, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia,
Mexico, Pakistan, Peru, Philippines, Poland, Russia, South Africa, Sri Lanka,
Taiwan, Thailand, Turkey and Venezuela. The Fund generally does not invest more
than 25% of its total assets in developing countries not represented within the
MSCI Emerging Markets Free Index.
[side bar]
Developing Markets Fund Risks. Like any investment, an investment in the
Developing Markets Fund is subject to risk and you could lose money. While the
Fund selects investments that the Fund believes will experience long-term
appreciation, their value could decline. The Fund is also subject to risks that
affect equity securities markets in general, such as general economic conditions
and adverse changes (generally increases) in interest rates.
There are certain risks involved in investing in non-U.S. securities, in
addition to the risks inherent in U.S. investments. These risks may include
currency fluctuations, currency revaluations, adverse political and economic
developments, currency exchange blockages, foreign governmental laws or
restrictions, reduced public information concerning issuers, and the lack of
uniform accounting, auditing and financial reporting standards and other
regulatory practices and requirements comparable for domestic companies.
Furthermore, non-U.S. securities may be less liquid and more volatile than
comparable U.S. securities. There is also a possibility of expropriation,
nationalization, confiscatory taxation, and limitations on use or removal of
Funds or assets. Investments in non-U.S. securities may result in higher
expenses due to currency conversions, brokerage commissions which generally are
higher than U.S. commissions and the expense of maintaining securities with
non-U.S. custodians.
In addition to the general risks of investing in non-U.S. securities,
characteristics of developing countries may affect certain investments, such as
national policies that restrict foreign investment and the absence of developed
legal structures governing private property and private and foreign investments.
The typically
<PAGE>
small size of securities markets and the possibility of a low or nonexistent
volume of trading in developing countries may also result in a lack of liquidity
and substantial price volatility.
You should be aware that investing in developing countries generally involves
exposure to economic structures that are generally less diverse and mature, and
to political systems with less stability than those of developed countries.
[end side bar]
For additional information on the use, risks and costs of the above referenced
policies and practices, see "Additional Information on Investment Policies and
Risks."
DLJ WINTHROP INTERNATIONAL EQUITY FUND
Goal: The investment objective of the DLJ Winthrop International Equity Fund is
long-term growth of capital by investing primarily in common stocks and other
equity securities from established non-U.S. markets. During normal market
conditions, the Fund invests most of its assets in securities of issuers from at
least three different countries outside the United States. The Fund may invest
in securities of companies incorporated in the United States but having their
principal activities and interests outside of the United States.
Strategy: In pursuing its investment objective, the International Equity Fund
attempts to diversify its equity investments primarily among countries
represented within the EAFE Index. Those countries currently include Australia,
Austria, Belgium, France, Germany, Hong Kong, Ireland, Italy, Japan, the
Netherlands, New Zealand, Portugal, Singapore, Spain, Switzerland, the United
Kingdom, and the Scandinavian countries. The Fund generally does not intend to
invest more than 10% of its total assets in countries not represented within the
EAFE Index.
This Fund seeks to identify countries and industries with favorable growth
prospects. Then the Fund invests in the companies in such countries and
industries that are reasonably valued. Typically these companies offer reliable
earnings and high quality management.
Investments: Equity securities include common and preferred stock, warrants,
rights or options that are convertible into common stock, debt securities that
are convertible into common stock, depositary receipts for those securities and
other classes of stock that may exist. The Fund may purchase non-U.S. securities
in the form of sponsored or unsponsored depositary receipts or other securities
representing underlying shares of non-U.S. issuers. This Fund may invest a
limited amount of its assets in restricted or otherwise illiquid securities. The
Fund may enter into forward foreign currency exchange contracts to protect the
value of its assets against future changes in the level of currency exchange
rates. The Fund may purchase and sell financial futures contracts and options
thereon which are traded on a commodities exchange or board of trade for certain
hedging, return enhancement and risk management purposes. The Fund may purchase
and sell financial futures contracts and related options, without limitation,
for bona fide hedging purposes. Subject to the foregoing, the value of all
financial futures contracts sold will not exceed the total market value of the
Fund's portfolio.
[ side bar]
ADRs: ADRs are Depositary Receipts typically issued by a U.S. bank or trust
company which evidence ownership of underlying securities issued by a non-U.S.
corporation.
EDRs and GDRs are Depositary Receipts typically issued by non-U.S. banks or
trust companies, although they also may be issued by U.S. banks or trust
companies, and evidence ownership of underlying securities issued by either a
non-U.S. or a U.S. corporation.
[end side bar]
[side bar]
<PAGE>
Cash Equivalents: The International Funds may from time to time take a defensive
position by holding all or a portion of the Fund in other types of securities,
including commercial paper, bankers' acceptances, short-term debt securities
(corporate and government) or government and high quality money market
securities of U.S. and non-U.S. issuers, repurchase agreements, time deposits or
cash (foreign currencies or U.S. dollars). The International Funds may also
temporarily hold cash and invest in high quality foreign or domestic money
market instruments with up to 35% of their assets, pending investment of
proceeds from new sales of International Funds' shares or to meet ordinary daily
cash needs.
[end side bar]
[side bar]
Risks for the International Equity Fund: Like any investment, an investment in
the International Equity Fund is subject to risk and you could lose money. While
the Fund selects investments the Fund believes will experience long-term
appreciation, their value could decline.
The Fund is also subject to risks that affect equity securities markets in
general, such as general economic conditions and adverse changes (generally
increases) in interest rates.
There are certain risks involved in investing in non-U.S. securities, in
addition to the risks inherent in U.S. investments. These risks may include
currency fluctuations, currency revaluations, adverse political and economic
developments, currency exchange blockages, foreign governmental laws or
restrictions, reduced public information concerning issuers, and the lack of
uniform accounting, auditing and financial reporting standards and other
regulatory practices and requirements comparable for domestic companies.
Furthermore, non-U.S. securities may be less liquid and more volatile than
comparable U.S. securities. There is also a possibility of expropriation,
nationalization, confiscatory taxation, and limitations on use or removal of
funds or assets.
Investments in non-U.S. securities may result in higher expenses due to currency
conversions, brokerage commissions which generally are higher than U.S.
commissions and the expense of maintaining securities with non-U.S. custodians.
[end side bar]
For additional information on the use, risks and costs of the above referenced
policies and practices, see "Additional Information on Investment Policies and
Risks."
THE MONEY FUNDS
DLJ WINTHROP MUNICIPAL MONEY FUND
Goal: The DLJ Winthrop Municipal Money Fund seeks maximum current income,
consistent with liquidity and safety of principal, that is exempt from Federal
income taxation to the extent described herein.
Strategy: The Fund pursues its objectives by investing at least 80% of its total
assets in municipal securities. One hundred percent of the securities the Fund
invests in are high quality having remaining maturities of one year or less,
although their maturities may extend to 397 days. The Fund reserves the right to
lower the percentage of investments in municipal securities if economic or
political conditions warrant. To increase the Fund's ability to reach its
investment objectives, the dollar-weighted average maturity of its portfolio
securities is always 90 days or less. In general, securities with longer
maturities are more vulnerable to price changes, although they may provide
higher yields. It is possible that a major change in interest rates or a default
on the Municipal Money Fund's investments could cause its net asset value per
share to deviate from $1.00.
Investments: Normally, substantially all the Municipal Money Fund's income will
be exempt from Federal income taxation. Such income may be subject to state or
local and/or Federal AMT income taxes. The Fund invests in municipal notes and
short-term municipal bonds, which may have fixed, variable or
<PAGE>
floating rates of interest. Municipal securities with variable rates may include
participation interests in industrial development bonds which may be backed by
letters of credit from banking or other financial institutions. The letters of
credit of any single institution in respect of all variable rate obligations
will not cover more than the allowable percentage of the Municipal Money Fund's
total assets in accordance with Rule 2a-7 under the Investment Company Act of
1940, as amended ("1940 Act"). For a more complete discussion of Municipal
Securities, see "Additional Information on Investment Policies and
Risks--Municipal Securities." All of the Fund's municipal securities at the time
of purchase are rated within the two highest quality ratings of Moody's or
S&P's, or judged by the Adviser to be of comparable quality.
The Municipal Money Fund may also invest without limitation in tax-exempt
municipal securities subject to the AMT. (See "Dividend and Distribution
Information" and "Taxes".')
The Municipal Money Fund may invest to a limited extent in stand-by commitments,
delayed-delivery, when-issued securities and other illiquid securities. This
Fund may also invest a small percentage of its net assets in municipal leases,
which are leases or installment purchases used by state and local governments as
a means to acquire property, equipment or facilities without involving debt
issuance limitations. The Fund may from time to time invest in taxable
securities including obligations of the U.S. Government and its agencies, high
quality certificates of deposit and bankers' acceptances, prime commercial
paper, and repurchase agreements.
[sidebar]
Risks for the Municipal Money Fund: Like any money market fund investment, this
investment is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency. This fund seeks to preserve the
value of your investment at $1.00 per share; however, it is possible to lose
money by investing in this Fund. To seek to reduce investment risk, the
Municipal Money Fund may not invest in the securities of any one issuer, (except
the U.S. Government), in excess of the percentage of the Municipal Money Fund's
total assets allowed under Rule 2a-7 of the 1940 Act.
The Municipal Money Fund earns income at current money market rates and its
yield varies from day to day and generally reflects current short-term interest
rates and other market conditions. It is important to note that neither the
Municipal Money Fund nor its yield are insured or guaranteed by the U.S.
Government.
[end sidebar]
For additional information on the use, risks and costs of the above referenced
policies and practices, see "Additional Information on Investment Policies and
Risks."
DLJ WINTHROP U.S. GOVERNMENT MONEY FUND
Goal: The DLJ Winthrop U.S. Government Money Fund seeks maximum current income,
consistent with liquidity and safety of principal.
Strategy: This Fund pursues its objectives by maintaining a portfolio of high
quality money market securities, including the types described in the succeeding
paragraph, which at the time of investment generally have remaining maturities
of one year or less. Some maturities may extend to 397 days. The dollar weighted
average maturity of the U.S. Government Money Fund's portfolio securities will
vary, but will always be 90 days or less. In general, securities with longer
maturities are more vulnerable to price changes, although they may provide
higher yields. It is possible that a major change in interest rates or a default
on the U.S. Government Money Fund's investments could cause its net asset value
per share to deviate from $1.00.
Investments: The Fund invests in U.S. Government Securities, including issues of
the U.S. Treasury, such as bills, certificates of indebtedness, notes and bonds,
and issues of agencies and instrumentalities established under the authority of
an act of Congress, including variable rate obligations such as floating rate
notes. The Fund also invests in repurchase agreements that are collateralized in
full each day by eligible mortgage related securities or the types of securities
listed above. These agreements are entered
<PAGE>
into with "primary dealers" (as designated by the Federal Reserve Bank of New
York) in U.S. Government Securities. This type of investment could create a loss
to the Fund if, in the event of a dealer default, the proceeds from the sale of
the collateral were less than the repurchase price. In addition, if the seller
of repurchase agreements becomes insolvent, the Fund's right to dispose of the
securities might be restricted.
In addition to the investments listed, the Money Funds may take temporary
defensive measures by holding other types of securities which are permitted by
Rule 2a-7 of the 1940 Act.
[side bar]
U.S. Government Money Fund Risks: Like any money market fund investment, this
investment is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
This Fund seeks to preserve the value of your investment at $1.00 per share,
however, it is possible to lose money by investing in this Fund.
The U.S. Government Money Fund earns income at current money market rates and
its yield will vary from day to day and generally reflects current short-term
interest rates and other market conditions.
It is important to note that neither the U.S. Government Money Fund nor its
yield is insured or guaranteed by the U.S. Government.
[end side bar]
[side bar]
To maintain portfolio diversification and reduce investment risk, the Money
Funds do not:
(1) borrow money, except from banks on a temporary basis or via entering into
reverse repurchase agreements to be used exclusively to facilitate the orderly
maturation and sale of portfolio securities during any periods of abnormally
heavy redemption requests (the borrowings are not used to purchase investments);
or
(2) pledge, hypothecate or in any manner transfer, as security for indebtedness,
its assets, except to secure such borrowings.
[end sidebar]
For additional information on the use, risks and costs of the above referenced
policies and practices, see "Additional Information on Investment Policies and
Risks."
DLJ WINTHROP HIGH INCOME FUND
Goal: The DLJ Winthrop High Income Fund seeks a high level of current income and
a secondary objective of capital appreciation. . This Fund is not recommended
for investors whose principal objective is assured income or capital
preservation.
Strategy: This Fund seeks to achieve its investment objectives by investing in
fixed-income securities, including corporate bonds and notes, convertible
securities and preferred stocks, that are rated in the lower rating categories
of the established rating services (Baa or lower by Moody's and BBB or lower by
S & P), or, if unrated, are of comparable quality. Securities rated Baa or lower
by Moody's and BBB or lower by Standard & Poor's are commonly known as "junk
bonds." These bonds are considered by those rating agencies to have speculative
characteristics. These bonds can be expected to provide higher yields. However
these securities may be subject to greater market fluctuations and risk of loss
of income and principal than lower yielding, higher-rated fixed-income
securities. Investment in such high-yield securities entails relatively greater
risk of loss of income or principal.
<PAGE>
Investments: This Fund seeks to achieve its objective by investing primarily in
a diversified portfolio of lower-rated fixed-income securities including
convertible and non-convertible debt securities and preferred stock. The Fund
may also hold assets in cash or cash equivalents. This Fund generally does not
invest in common stocks, rights or other equity securities. From time to time,
the Fund may acquire or hold such securities (if consistent with its objectives)
when they are acquired in unit offerings with fixed-income securities or in
connection with an actual or proposed conversion, exchange or restructuring of
fixed-income securities.
Selection and supervision by the management of the Fund of investments in
lower-rated fixed-income securities involves continuous analysis of individual
issuers, general business conditions and other factors. The furnishing of these
services does not, of course, guarantee successful results. The Adviser's
analysis of issuers includes, among other things, historic and current financial
conditions, current and anticipated cash flow and borrowing requirements, value
of assets in relation to historical cost, strength of management, responsiveness
to business conditions, credit standing, and current and anticipated results of
operations. Analysis of general business conditions and other factors may
include anticipated changes in economic activity and interest rates, the
availability of new investment opportunities, and the economic outlook for
specific industries. While the Adviser considers as one factor in its credit
analysis the ratings assigned by the rating services, the Adviser performs its
own independent credit analysis of issuers and consequently, the High Income
Fund may invest, without limit, in unrated securities. The Fund's ability to
achieve its investment objective may depend on the Adviser's own credit analysis
to a greater extent than the funds that invest in higher-rated securities.
Although the High Income Fund primarily invests in lower-rated securities, it
will generally not invest in securities rated at the time of investment in the
lowest rating categories (Ca or below for Moody's and CC or below for S & P).
Securities which are subsequently downgraded may continue to be held and will be
sold only if, in the judgment of the Adviser, it is advantageous to do so.
[side bar]
High Income Fund Risks:
While the Fund seeks investments that will satisfy our investment objective, our
investments could decline in value and you could lose money. Concerns about an
issuer's ability to repay its borrowings or to pay interest will adversely
affect the value of its securities. The Fund is also subject to risks that
affect the bond markets in general, such as general economic conditions and
adverse changes (generally increases) in interest rates.
The market value of longer maturity debt securities, like those held by the
Fund, is more sensitive to interest rate changes than the market value of
shorter maturity debt securities. In addition, the Fund's investments in lower
grade securities will subject investors to additional risk than normally
experienced in other fixed income securities.
Lower grade securities are regarded as being predominantly speculative as to the
issuer's ability to pay the principal and interest. Issuers of lower grade
securities are more likely to experience financial stress in periods of economic
downturn or rising interest rates. The issuer's ability to service its debt may
be adversely affected by poor management, inability to meet business forecasts
or unavailability of additional financing.
There is a higher default rate with lower grade securities because they may be
unsecured or subordinate to other securities of the issuer. There are fewer
dealers in lower grade securities which may make the market less liquid and
cause larger differences in prices quoted than that of higher-rated fixed income
securities.
In addition, the Fund may incur additional expense when it is required to seek
recovery upon a default or restructuring.
[end side bar]
ADDITIONAL INFORMATION ON INVESTMENT POLICIES AND RISKS
<PAGE>
The following general investment policies and risks supplement those set forth
above for each Fund.
Equity Securities. "Equity securities" include common stock, preferred stock
(including convertible preferred stock), bonds convertible into common or
preferred stock, rights and warrants, equity interests in trusts and depositary
receipts for equity securities.
Convertible Securities. A "convertible security" is a bond or preferred stock
which may be converted at a stated price within a specified period of time into
a certain quantity of the common or preferred stock of the same or a different
issuer. Convertible securities have characteristics of both bonds and equity
securities. Like a bond, a convertible security tends to increase in market
value when interest rates decline and tends to decrease in market value when
interest rates rise. However, the price of a convertible security is also
influenced by the market value of the underlying stock. The price of a
convertible security tends to increase as the market value of the underlying
stock rises, whereas it tends to decrease as the market value of the underlying
stock declines.
Warrants. A "warrant" gives the holder thereof the right to buy equity
securities at a specific price during a specified period of time. Warrants tend
to be more volatile than the underlying security, and if at a warrant's
expiration date the security is trading at a price below the price set in the
warrant, the warrant will expire worthless. Conversely, if at the expiration
date the underlying security is trading at a price higher than the price set in
the warrant, the holder of the warrant can acquire the security at a price below
its market value.
Mortgage and Asset-Backed Securities. Except for the Municipal Trust Fund, the
DLJ Winthrop Funds may invest in mortgage and asset-backed securities.
"Mortgage-backed securities" are securities that directly or indirectly
represent a participation in, or are secured by and payable from mortgage loans
on real property, including pass-through securities such as Ginnie Mae, Fannie
Mae and Freddie Mac Certificates. The yield and credit characteristics of
mortgage-backed securities differ in a number of ways from traditional fixed
income securities. The major differences typically include more frequent
interest and principal payments, usually monthly, and the possibility that
prepayment of principal may be made at any time. Prepayment rates are influenced
by changes in current interest rates and a variety of other factors. In general,
changes in the rate of prepayment on a security will change the yield to
maturity of that security. Under certain interest rate or prepayment rate
scenarios, a Fund may fail to recoup fully its investment in such securities
notwithstanding the credit quality of the issuers of such securities. Based on
historic prepayment patterns, amounts available for reinvestment are likely to
be greater during a period of declining interest rates and, thus, are likely to
be reinvested at lower interest rates, than during a period of rising interest
rates. Mortgage-backed securities may decrease in value as a result of increases
in interest rates and may benefit less than other fixed income securities from
declining interest rates because of the risk of prepayment.
Asset-Backed Securities. "Asset-backed securities" have similar structural
characteristics to mortgage-backed securities, but the underlying assets include
assets such as motor vehicle installment sales or installment loan contracts,
leases of various types of real and personal property and receivables from
revolving credit agreements, rather than mortgage loans or interests in mortgage
loans. Asset-backed securities present certain risks that are not present in
mortgage-backed securities; primarily, these securities do not have the benefit
of the same security interest in the related collateral. There is the
possibility that recoveries of repossessed collateral may not, in some cases, be
available to support payments on these securities. For example, in the event
that the collateral underlying an asset-backed security must be disposed of, it
may be difficult to convert that collateral into a stream of payments to be paid
to the holders of the security.
<PAGE>
Municipal Securities. "Municipal securities" are either bonds or notes.
Municipal bonds, which are longer-term debt obligations meeting long-term
capital needs, are either "general obligation" bonds or "revenue" bonds. Payment
of principal and interest on general obligation bonds is secured by the issuing
municipality's pledge of its full faith and credit and taxing power. Payment on
revenue bonds is met from the revenues obtained from a certain facility, class
of facilities, special excise or other tax, but not from general tax revenues.
Variations on these two classifications exist, such as revenue bonds backed by a
municipality's general taxing power, or general obligation bonds backed by
limited taxing power.
Municipal notes are short-term debt obligations generally maturing in one year
or less meeting short-term capital needs and are also either "general
obligation" or "revenue" debt securities. They include tax anticipation notes,
revenue anticipation notes, bond anticipation notes, construction loan notes and
tax- exempt commercial paper.
Municipal securities may have fixed, variable or floating rates of interest.
Variable and floating rate securities pay interest at rates that are adjusted
periodically, according to a specified formula, in order to minimize fluctuation
in the value of the principal of the securities. A "variable" interest rate
adjusts at predetermined intervals (e.g., daily, weekly, or monthly), while a
"floating" interest rate adjusts whenever a specified benchmark rate (such as
the bank prime lending rate) changes.
The Municipal Money Fund and Municipal Trust Fund may invest in variable rate
obligations. Such adjustments minimize changes in the market value of the
obligation, and in the case of the Municipal Money Fund enhances the ability of
such Fund to maintain a stable $1.00 net asset value. See "'Net Asset Value" on
page 17.
Investment-Grade Debt Securities. All of the DLJ Winthrop Funds may invest in
debt securities of investment-grade quality. "Investment-grade debt securities"
are debt securities rated in one of the four highest rating categories by a
nationally recognized statistical rating organization, such as S&P or Moody's.
Investment-grade debt securities may also include debt securities believed by
the Adviser (on the basis of criteria believed by the Adviser to be comparable
to that applied by such rating agencies) to be of comparable quality to debt
securities so rated by the rating agencies.
Debt securities rated Baa or higher by Moody's or BBB or higher by S&P are
investment-grade securities. Securities rated BBB are regarded by S&P as having
an adequate capacity to pay interest and repay principal; while such securities
normally exhibit adequate protection parameters, adverse economic conditions or
changing circumstances are more likely, in the opinion of S&P, to lead to a
weakened capacity to pay interest and repay principal for debt in this category
than in higher rated categories.
Securities rated Baa by Moody's are considered to be medium-grade obligations.
These securities are neither highly protected nor poorly secured. The rating
organization determines that interest payments and principal security appear to
be adequate for the present but certain protective elements may be lacking or
may be characteristically unreliable over any great length of time. For a more
complete description of Moody's and S&P's ratings, see the Appendix to the
Statement of Additional Information of each of the DLJ Winthrop Funds. The
investment-grade limitations referenced for each Fund are applicable at the time
of initial investment and a Fund may determine to retain securities of issuers
which have had their credit characteristics downgraded.
Repurchase Agreements. The DLJ Winthrop Funds may enter into a repurchase
agreement with member banks of the Federal Reserve System or "primary dealers"
(as designated by the Federal Reserve Bank of New York) in such securities.
Repurchase agreements permit a Fund to keep all of its assets at work while
retaining "overnight" flexibility in pursuit of investments of a longer-term
nature. The Adviser requires continual maintenance of collateral with a Fund's
custodian in an amount equal to, or in excess of, the market value of the
securities that are the subject of a repurchase agreement. In the event a
counterparty defaults on its repurchase obligation, a Fund might suffer a loss
to the extent that the proceeds from the sale of the collateral are less than
the repurchase price. If the counterparty becomes the subject of bankruptcy
proceedings, the Fund might be delayed in selling the collateral.
<PAGE>
Non-U.S. Securities. All of the DLJ Winthrop Funds, except the Money Funds and
the Municipal Trust Fund, may invest in "non-U.S. securities." There are
additional risks involved in investing in non-U.S. securities. These risks
include those resulting from fluctuations in currency exchange rates,
revaluation of currencies, and the possible imposition of currency exchange
blockages. In addition, there are risks associated with future adverse political
and economic developments and a limited availability of public information
concerning issuers. Non-U.S. issuers typically are subject to different
accounting, auditing and financial reporting standards. Securities of many
non-U.S. companies may be less liquid and their prices more volatile than those
of domestic companies. There is the possibility of expropriation,
nationalization, confiscatory taxation and limitations on the use or removal of
Funds or other assets of a non-U.S. issuer, including the withholding of
dividends.
Non-U.S. securities may be subject to taxes imposed by foreign governments that
would reduce the net yield on such securities. Investment in non-U.S. securities
may result in higher expenses due to the cost of converting foreign currency
into U.S. dollars, the payment of fixed brokerage commissions on foreign
exchanges (which generally are higher than commissions on U.S. exchanges) and
the expense of maintaining securities with non-U.S. custodians.
Investments in non-U.S. securities include securities issued by European
issuers. On January 1, 1999, the countries participating in the European
Monetary Union ("EMU") implemented a new currency unit, the Euro, which is
reshaping financial markets, banking systems and monetary policies in Europe and
other parts of the world. Although it is not possible to predict the eventual
impact of the Euro implementation plan on the Funds, the transition to the Euro
may change the economic environment and behavior of investors, particularly in
European markets. Certain European investments may be subject to additional
risks as a result of this conversion. These risks include adverse tax and
accounting consequences, as well as difficulty in processing transactions. The
Funds are aware of such potential problems and are coordinating ways to prevent
or alleviate their adverse impact on the Funds.
Investment Companies. Certain Funds may invest a limited amount of their assets
in shares of other investment companies. Investments in other mutual funds may
involve the payment of substantial premiums above the value of such investment
companies' portfolio securities. In addition, such investments are subject to
limitations under the 1940 Act and market availability. Currently, the
International Funds and the Municipal Money Fund may invest in such investment
companies if, in the judgment of the Adviser or Subadviser, the potential
benefits of such investments justify the payment of any applicable premium or
sales charge. As a shareholder in an investment company, the Municipal Money
Fund or an International Fund would bear its ratable share of that investment
company's expenses, including its advisory and administrative fees. At the same
time shareholders of the Municipal Money Fund or an International Fund would
continue to pay their own management fees and other expenses.
Options. A call option is a contract that gives the holder the right to buy from
the seller the security underlying the call option at a pre-determined price
while a put option is a contract that gives the buyer the right to require the
seller to purchase the security underlying the put option at a pre-determined
price. The Growth Fund and the Growth and Income Fund may write covered call
options on individual securities or stock indices. For these Funds, this
practice will only be used to minimize the effect of a market decline in the
value of securities in their respective portfolios. We cannot guarantee that,
should a Fund seek to enter into such transactions, it could do so at all or on
terms that are acceptable. The Small Company Value Fund may purchase or sell put
and call options on individual securities or stock indices as a means of
achieving additional return or of hedging the value of its portfolio. The
International Funds may purchase and sell put and call options on securities,
currencies and financial indices that are traded on U.S. or non-U.S. securities
exchanges or in the over-the-counter market. Options traded in the
over-the-counter market are considered illiquid investments.
Lower-Grade or Unrated Securities. The High Income Fund will purchase lower or
unrated securities. "Lower-grade securities" are regarded as being predominantly
speculative as to the issuer's ability to make payments of principal and
interest. Investment in these securities involves substantial risk. Lower-grade
securities are commonly referred to as "junk bonds". Issuers of lower-grade
securities may be highly leveraged and may not have traditional methods of
financing. The risks associated with acquiring the
<PAGE>
securities of these issuers generally are greater than is the case with
higher-rated securities. For example, during an economic downturn or a sustained
period of rising interest rates, issuers of lower-grade securities may be more
likely to experience financial stress, especially if such issuers are highly
leveraged. The risk of loss due to default is significantly greater for the
holders of lower-grade securities because such securities may be unsecured and
may be subordinate to other securities of the issuer.
FUND MANAGEMENT
DLJ Asset Management Group, Inc. (formerly known as Wood, Struthers & Winthrop
Management Corp)., a Delaware corporation with principal offices at 277 Park
Avenue, New York, New York 10172 ("DLJAM" or the "Adviser"), serves as the
investment adviser for each of the DLJ Winthrop Funds. AXA Investment Managers
GS Ltd, a UK registered company with principal offices at 60 Gracechurch Street,
London EC3V 0HR, England serves as sub-investment adviser for the International
Funds and is a wholly-owned subsidiary of AXA Investment Managers, an investment
management subsidiary of AXA. Effective October 1, 1999, due to an internal
restructuring within the AXA Investment Managers Group of Companies, AXA
Investment Managers GS Ltd assumed the sub-investment advisory responsibilities
formerly undertaken by AXA Asset Management Partenaires, a French wholly-owned
subsidiary of AXA Investment Managers. Investment personnel and policies remain
unchanged.
DLJAM is a subsidiary of Donaldson, Lufkin & Jenrette Securities Corporation,
which is a member of the New York Stock Exchange and a wholly-owned subsidiary
of DLJ, Inc., a major international supplier of financial services. DLJ, Inc. is
an independently operated, indirect subsidiary of AXA Financial, Inc., a holding
company controlled by AXA, a member of a large French insurance group. AXA is
indirectly controlled by a group of four French mutual insurance companies.
The fees paid for the fiscal year ended October 31, 1999 were as follows:
Fund % of Average Net Assets Fees Paid
- --------------------------------------------------------------------------------
Growth Fund .67% $984,475
- --------------------------------------------------------------------------------
Growth and Income Fund .58% $1,377,123
- --------------------------------------------------------------------------------
Small Company Value Fund .79% $1,826,662
- --------------------------------------------------------------------------------
Fixed Income Fund .625% $641,978
- --------------------------------------------------------------------------------
Municipal Trust Fund .625% $247,109
- --------------------------------------------------------------------------------
High Income Fund .70% $44,319
- --------------------------------------------------------------------------------
International Equity Fund 1.25% $641,576
- --------------------------------------------------------------------------------
Developing Markets Fund 1.25% $215,235
- --------------------------------------------------------------------------------
U.S. Government Money Fund .40% $234,429
- --------------------------------------------------------------------------------
Municipal Money Fund .40% $212,914
- --------------------------------------------------------------------------------
* The following individuals are responsible for management of the DLJ Winthrop's
Funds.
Cathy A. Jameson is the portfolio manager of the Fixed Income Fund, a position
she has held since the Fund was started in 1986. Ms. Jameson is a Vice President
of the DLJ Winthrop Focus Funds. She is also a Managing Director of DLJAM and
has been an employee of DLJAM since 1979.
Roger W. Vogel serves as the primary portfolio manager of the Small Company
Value Fund and as of February, 2000, the Growth and Income Fund. He has acted as
the portfolio co-manager of the Growth Fund, the Growth and Income Fund, and the
Small Company Value Fund since July 1993. Mr. Vogel is a Vice President of the
DLJ Winthrop Focus Funds, and a Managing Director of DLJAM. Prior to becoming
associated with the Funds, Mr. Vogel was a Vice President and portfolio manager
with Chemical Banking Corp.
<PAGE>
Marybeth B. Leithead is the portfolio manager of the Municipal Trust Fund, a
position she has held since the commencement of its operations on July 28, 1993.
Ms. Leithead is also a Vice President of the DLJ Winthrop Focus Funds and a
Senior Vice President of DLJAM. She has been an employee of DLJAM since 1989. A
tax-exempt fixed income specialist, Ms. Leithead is responsible for short-term
and long-term municipal bond investment management for clients of the Advisers.
Prior to joining DLJAM, Ms. Leithead was an employee of Citicorp Securities
Markets Inc.
Hugh M. Neuburger is the primary portfolio manager of the Growth Fund. He has
also served as the co-portfolio manager of the Growth Fund, the Growth and
Income Fund and the Small Company Value Fund since August 1995. Mr. Neuburger is
a Managing Director and Director of Quantitative Analysis of DLJAM and has been
an employee of DLJAM since March 1995. Prior to March 1995, Mr. Neuburger was
the president of Hugh M. Neuburger, Inc., a consulting firm providing domestic
and global tactical asset allocation advice and other consulting services to
large corporate and state pension plans. From 1986 through 1991, Mr. Neuburger
was Managing Director of Matrix Capital Management, an investment management
firm. Prior to 1986, Mr. Neuburger managed asset allocation portfolios for
Prudential Insurance Company of America.
Michael A. Snyder is the portfolio manager of the High Income Fund. Mr. Snyder
was appointed Vice President of the DLJ Winthrop Opportunity Funds and Managing
Director of DLJAM in October 1998. Prior to becoming associated with the DLJ
Winthrop Funds and joining DLJAM, Mr. Snyder spent two years as a managing
director with Bear Stearns Asset Management where he was responsible for the
firm's high-yield bond management effort. Prior to that position, Mr. Snyder
spent ten years at Prudential Investments where he was a senior portfolio
manager in the firm's High Yield Mutual Fund Group.
Robert de Guigne, an employee of the Subadviser, serves as portfolio manager of
the International Funds. Mr. de Guigne assumed the day-to-day investment
responsibilities of the Developing Markets Fund in August 1996 and the
International Equity Fund in June 1997. Mr. de Guigne has been an asset manager
responsible for emerging market equities for a subsidiary of AXA since April
1996. Previously, Mr. de Guigne was a portfolio manager for State Street Bank in
Paris.
HOW TO BUY AND SELL SHARES
Opening an Account:
Decide whether your first payment will be delivered by check or wire. Initial
payment must be at least $250.
By check using U.S. mail:
Complete an application and send it along with a check made payable to the DLJ
Winthrop Funds to:
DLJ Winthrop Funds
PFPC, Inc.
P.O. Box 61503
King of Prussia, PA 19406-3101
By check using U.S. overnight delivery.
Complete an application and send it along with a check made payable to the DLJ
Winthrop Funds to:
<PAGE>
DLJ Winthrop Funds
PFPC, Inc.
211 S. Gulph Road
King of Prussia, PA 19406-3101
By wire:
Call DLJ Winthrop Funds at 1-800-225-8011 (option #2) to obtain an account
number. A representative will instruct you to send a completed, signed
application to the Transfer Agent, PFPC, Inc ("Transfer Agent"). Your account
cannot be opened without a completed, signed application and a Fund account
number.
Contact your bank to arrange a wire transfer to:
Boston Safe Deposit & Trust
ABA #:011001234
Credit: (Insert Name of Your Fund)
ACCT#: 006068
FBO (Shareholder name and account number)
Your wire instructions must also include: the name of the Fund, your account
number and the name(s) of the account holders.
The account will be established once the application and check are received in
good order. If you purchase shares of the Money Funds through a wire transfer,
you will be eligible to receive the daily dividend declared on the date of
purchase, as long as the Transfer Agent is notified of such purchase by 12:00
noon. The funds must be received by the Transfer Agent by 4:00 P.M.
Investors may also open accounts for their DLJ Winthrop Funds through their
securities dealer. In addition, securities dealers may offer an automatic sweep
for the shares of the Money Funds in the operation of cash accounts for their
customers. Shares of the Money Funds purchased through an automatic sweep by
1:00 P.M. are eligible to receive that day's daily dividend. For more
information, contact your securities dealer.
Shareholder accounts established on behalf of the following types of plans will
be exempt from the Fund's minimum and additional investment amounts: 401K Plans,
403B Plans, 457 Plans, SEP Plans, and SIMPLE Plans. An account established for
the Funds' Class D shares will also be exempt from the Funds' minimum and
subsequent purchase requirements. In addition, the Funds reserve the right to
waive their minimum purchase requirements.
Additional investments may be made at any time by sending a check payable to the
Funds along with an investment stub found at the bottom of the Funds'
Shareholder Statement form. If the stub is not available, you may send a check
payable to the "DLJ Winthrop Funds" directly to the Transfer Agent at the
address listed above. Please reference the account number to be credited on the
check, as well as the Fund you have selected to purchase.
Selling Shares of the Money
Funds or Class A, Class B or Class C shares of the Other DLJ Winthrop Funds
Will you be requesting a redemption of your holdings in the DLJ Winthrop Funds
through the Funds' Telephone Redemption Privilege?
Yes.
<PAGE>
Call 1-800-225-8011 to sell your shares. Requests for redemptions of more than
$50,000 must be made in writing and be accompanied by a signature guarantee.
(A "signature guarantee" is a signature guaranteed by an eligible bank, broker,
dealer, credit union, national securities exchange, registered securities
association, clearing agency or savings association.)
Remember, DLJ has a minimum account size of $250.
No.
For shares held at the Fund, write to the Fund at:
DLJ Winthrop Funds
PFPC, Inc.
P.O. Box 61503
(211 S. Gulph Road)*
King of Prussia, PA 19406-3101
Remember, any account that has less than $250, the Fund may redeem.
* For overnight delivery.
For shares purchased through a broker-dealer: call your broker or securities
dealer representative.
Your redemption will be processed at the net asset value per share, next
computed following the receipt of your request in proper form. If you own Class
B or Class C shares or purchased Class A shares without paying an initial sales
charge, any applicable CDSC will be applied to the net asset value and deducted
from your redemption. The value of your shares may be more or less than your
investment depending on the net asset value of your Fund on the day you redeem.
The DLJ Winthrop Funds have a minimum account size of $250. You may be requested
to increase your balance if it falls below $250. The Funds reserve the right to
close such account and send the proceeds to you. A Fund will not redeem
involuntarily any shareholder account with an aggregate balance of less than
$250 based solely on the market movement of such Fund's shares.
For information concerning circumstances in which redemptions may be effected
through the delivery of in-kind portfolio securities, see your Statement of
Additional Information.
Purchasing additional shares
Decide if you are making additional purchases by mail, wire, or automatic
investment. If using mail or wire, please check to make sure funds meet the
$25.00 minimum.
By Mail:
Complete the investment stub found at the bottom of the Funds' shareholder
statement form, or if an investment stub is not available, reference on the
check the account number to be credited and the Fund you have selected to
purchase and mail to:
DLJ Winthrop Funds
PFPC, Inc.
P.O. Box 61503
King of Prussia, PA. 19406-3101
<PAGE>
By Wire:
Please call the Transfer Agent at 800-225-8011 (option #2) to notify them of the
impending wire.
Provide your bank with funds and with the following information:
Boston Safe Deposit & Trust
ABA #:011001234
Credit: (Insert Name of Your Fund)
ACCT#: 006068
FBO Shareholder name and account number
Purchase should reference your name, account number, and name of Fund.
Automatic Investment Program:
The automatic investment program requires purchases of at least $25.00. Fill out
the application, designating the automatic investment option and provide your
bank information. The Fund automatically deducts payment from your account on a
regular basis.
Provide your bank with funds and with the following information:
Boston Safe Deposit & Trust
ABA #:011001234
Credit: (Insert Name of Your Fund)
ACCT#: 006068
FBO Shareholder name and account number
Shares of the Money Funds or Class A, Class B or Class C shares of the other DLJ
Winthrop Funds may be purchased directly by using the Share Purchase Application
found in the prospectus, or through Donaldson, Lufkin & Jenrette Securities
Corporation, or by contacting your securities dealer. Shareholders should read
the prospectus carefully before investing in the Funds.
The minimum initial investment in each Fund is $250. The minimum for additional
investments is $25. There is a maximum purchase limitation in the Funds' Class B
shares of $250,000 and $1,000,000 in the Funds' Class C shares. Each of the
Funds, except the Money Funds, offers Class A, Class B and Class C shares. Class
A shares may be purchased at a price equal to net asset value of the Fund plus
an initial sales charge imposed at the time of purchase. On a purchase of
$1,000,000 or more, there is no initial sales charge, but there could be a CDSC
if the shares are redeemed within one year of purchase. Class B shares may be
purchased for net asset value, but may be subject to a CDSC upon redemption. The
CDSC declines from 4% during the first year of purchase to zero after four
years. Class B shares will convert to Class A shares approximately eight years
from the time of purchase. Class C shares may be purchased for net asset value,
but may be subject to a 1% CDSC if redeemed in the first year. Class D shares
are offered exclusively to employees of DLJ and its subsidiaries that are
eligible to participate in the DLJ 401(k) Retirement Savings Plan. These
employees should contact the DLJ Hotline at 1-877-401k-DLJ to learn how to
purchase Class D shares. Shares of the Money Funds may be purchased at a price
equal to the net asset value per share which is expected to be $1.00.
OTHER SHAREHOLDER INFORMATION
Classes of Shares and Sales Charges
The DLJ Winthrop Funds, except the Money Funds, offer Class A shares, Class B
shares, and Class C shares to the general public. Class D shares are offered
exclusively to employees of DLJ and its subsidiaries who are eligible to
participate in the DLJ 401(k) Retirement Savings Plan. Class D shares are only
offered by the Growth Fund, the Growth and Income Fund, the Fixed Income Fund,
the High Income
<PAGE>
Fund and the International Equity Fund. Shares held in each Fund are normally
entitled to one vote (with proportional voting for fractional shares) for all
purposes.
With respect to the DLJ Winthrop Focus Funds and DLJ Winthrop Opportunity Funds,
each class is identical in all respects except that each class bears different
distribution service fees (except for Class D shares, which are not subject to
any distribution service fees and are offered only to a limited group of
investors). Each class has different exchange privileges and only Class B shares
have a conversion feature. Class A, Class B and Class C have exclusive voting
rights with respect to that class's 12b-1 Plan.
CLASS A Shares
[side bar]
Offering Price:
The offering price for Class A shares (with a sales charge) is NAV plus the
applicable sales charge (unless you are entitled to a waiver).
[end side bar]
The offering price for Class A shares of the Funds is the net asset value plus
the applicable sales charge from the schedule below.
Initial Sales Charge-Class A
Fixed Income Funds (1)
- --------------------------------------------------------------------------------
Amount Purchased As a % of Amount As a % of Offering Commission to
Invested Price Dealer/Agent as a %
of Offering Price
- --------------------------------------------------------------------------------
Less than $50,000 4.99% 4.75% 4.25%
- --------------------------------------------------------------------------------
$50,000 to less than 4.71% 4.50% 4.00%
$100,000
- --------------------------------------------------------------------------------
$100,000 to less than 3.63% 3.50% 3.25%
$250,000
- --------------------------------------------------------------------------------
$250,000 to less than 2.56% 2.50% 2.25%
$500,000
- --------------------------------------------------------------------------------
$500,000 to less than 2.04% 2.00% 1.75%
$1,000,000
- --------------------------------------------------------------------------------
$1,000,000 or more 0 0 1.00%*
- --------------------------------------------------------------------------------
Equity Funds(2):
- --------------------------------------------------------------------------------
Amount Purchased As a % of Amount As a % of Offering Commission to
Invested Price Dealer/Agent as a %
of Offering Price
- --------------------------------------------------------------------------------
Less than $50,000. 6.10% 5.75% 5.00%
- --------------------------------------------------------------------------------
$50,000 to less than 4.99% 4.75% 4.00%
$100,000
- --------------------------------------------------------------------------------
$100,000 to less than 3.90% 3.75% 3.00%
$250,000.
- --------------------------------------------------------------------------------
$250,000 to less than 2.56% 2.50% 2.00%
$500,000.
- --------------------------------------------------------------------------------
$500,000 to less than 2.04% 2.00% 1.75%
$1,000,000
- --------------------------------------------------------------------------------
$1,000,000 or more 0 0 1.00%*
- --------------------------------------------------------------------------------
<PAGE>
(1) The Fixed Income Funds include the Fixed Income Fund, the Municipal Trust
Fund and the High Income Fund.
(2) The Equity Funds include the Growth Fund, Growth and Income Fund, the
Small Company Value Fund, the Developing Markets Fund and the
International Equity Fund.
*On purchases of $1,000,000 or more, there is no initial sales charge although
there could be a Limited CDSC (as described below). The Distributor may pay the
dealer a fee of up to 1% as follows: 1% on purchases up to and including $3
million, .50% on the next $47 million, .25% on purchases over $50 million. In
addition, Class A shares issued upon conversion of Class B shares of the Funds
are not subject to an initial sales charge.
From time to time, the Distributor may re-allow the full amount of the sales
charge to brokers as a commission for sales of such shares.
In addition, investors may be charged a fee by a securities dealer if they
effect transactions through a broker or agent.
The initial sales charge is waived for the following shareholders or
transactions:
(1) investment advisory clients of the Advisers;
(2) officers, Trustees and retired Trustees of the Funds, directors or trustees
of other investment companies managed by the Advisers, officers, directors and
full-time employees of the Advisers and of their wholly-owned subsidiaries or
parent entities ("Related Entities"); or the spouse, siblings, children, parents
or grandparents of any such person or any such person's spouse (collectively,
"relatives"), or any trust or individual retirement account or self-employed
retirement plan for the benefit of any such person or relative; or the estate of
any such person or relative, if such sales are made for investment purposes
(such shares may not be resold except to the Funds);
(3) certain employee benefit plans for employees of the Advisers and Related
Entities;
(4) full-time employees of the Funds' Transfer Agent or an entity that provides
distribution to the Funds, an agent or broker of a dealer that has a sales
agreement with the Distributor, for their own account or an account of a
relative of any such person, or any trust or individual retirement account or
self-employed retirement plan for the benefit of any such person or relative; or
the estate of any such person or relative, if such sales are made for investment
purposes (such shares may not be resold except to the Funds);
(5) shares purchased by registered investment advisers on behalf of fee-based
accounts or by broker-dealers that have sales agreements with the Funds and for
which shares have been purchased on behalf of wrap fee client accounts and for
which such registered investment advisers or broker-dealers perform advisory,
custodial, record keeping or other services;
(6) shareholders who received shares in the DLJ Winthrop Funds as a result of
the merger of Neuwirth Fund, Inc., Pine Street Fund, Inc. or deVegh Mutual Fund,
Inc., and who have maintained their investment in such shares;
(7) shares purchased for 401(k) Plans, 403(b) Plans and 457 Plans; and employee
benefit plans sponsored by an employer; and
(8) Class B shares which are automatically converted to Class A shares.
Reduced sales charges are available to participants in the following programs:
<PAGE>
Letter of Intent. By initially investing at least $250 and submitting a Letter
of Intent to the Funds' Distributor or Transfer Agent, you may purchase shares
of a DLJ Winthrop Fund over a 13-month period at the reduced sales charge, which
applies, to the aggregate amount of the intended purchases stated in the Letter.
The Letter only applies to purchases made up to 90 days before the date of the
Letter.
Right of Accumulation. For investors who already have an account with the Funds,
reduced sales charges based upon the Funds' sales charge schedules are
applicable to subsequent purchases. The sales charge on each additional purchase
is determined by adding the current net asset value of the shares the investor
currently owns to the amount being invested. The Right of Accumulation is
illustrated by the following example: If a previous purchase currently valued in
the amount of $50,000 had been made subject to a sales charge and the shares are
still held, a current purchase of $50,000 will qualify for a reduced sales
charge (i.e., the sales charge on a $100,000 purchase).
The reduced sales charge is applicable only to current purchases. It is the
investor's responsibility to notify the Transfer Agent at the time of subsequent
purchases that the account is eligible for the Right of Accumulation.
Concurrent Purchases. To qualify for a reduced sales charge, you may combine
concurrent purchases of shares purchased in any DLJ Winthrop Fund. For example,
if the investor concurrently invests $25,000 in one Fund and $25,000 in another,
the sales charge would be reduced to reflect a $50,000 purchase. In order to
exercise the Concurrent Purchases privilege, the investor must notify the
Distributor or Transfer Agent prior to his or her purchase.
Combined Purchase Privilege. By combining the investor's holdings of shares in
any DLJ Winthrop Fund, the investor can reduce the initial sales charges on any
additional purchases of Class A shares. The investor may also use these
combinations under a Letter of Intent. This allows the investor to make
purchases over a 13-month period and qualify the entire purchase for a reduction
in initial sales charges on Class A shares. A combined purchase of $1,000,000 or
more may trigger the payment of a dealer's commission and the applicability of a
Limited CDSC. See "Other Shareholder Information - Class A Limited CDSC."
Reinstatement Privilege. The Reinstatement Privilege permits shareholders to
reinvest the proceeds provided by a redemption of a Fund's Class A shares within
120 days from the date of redemption without an initial sales charge. It is the
investor's responsibility to notify the Transfer Agent prior to his or her
purchase in order to exercise the Reinstatement Privilege. In addition, a CDSC
paid to the Distributor will be eligible for reimbursement at the current net
asset value of the applicable Fund if a shareholder reinstates his Fund account
holdings within 120 days from the date of redemption.
CLASS B SHARES
You may choose to purchase Class B shares at the Fund's net asset value although
such shares may be subject to a CDSC when you redeem your investment. The CDSC
does not apply to investments held for more than four years or shares received
pursuant to dividend reinvestment.
Where the CDSC is imposed, the amount of the CDSC will depend on the number of
years that you have held the shares according to the table on this page. The
CDSC will be assessed on an amount equal to the lesser of the then current net
asset value or the original purchase price of the shares identified for
redemption.
[sidebar]
Year after Purchase/ CDSC Percentage
1st 4%
2nd 3%
3rd 2%
4th 1%
After 4th year None
[end sidebar]
<PAGE>
The CDSC on Class B shares will be waived for the following shareholders or
transactions:
(1) shares received pursuant to the exchange privilege which are currently
exempt from a CDSC;
(2) redemptions as a result of shareholder death or disability (as defined in
the Internal Revenue Code of 1986, as amended);
(3) redemptions made pursuant to a DLJ Winthrop Fund's systematic withdrawal
plan pursuant to which up to 1% monthly or 3% quarterly of an account (excluding
dividend reinvestments) may be withdrawn, provided that no more than 12% of the
total market value of an account may be withdrawn over any 12 month period.
Shareholders who elect systematic withdrawals on a semi-annual or annual basis
are not eligible for the waiver; and
(4) liquidations, distributions or loans from the following types of retirement
plan accounts:
o Section 401(k) retirement Plans;
o Section 403(b) Plans; or
o Section 457 Plans;and
(5) A total or partial redemption related to certain distributions from
retirement plans or accounts at age 70 1/2, which are permitted without penalty
pursuant to the Internal Revenue Code.
Redemptions effected by the Funds pursuant to their right to liquidate a
shareholder's account with a current net asset value of less than $250 will not
be subject to the CDSC.
Class A Limited CDSC. A Limited Contingent Deferred Sales Charge ("Limited
CDSC") will be imposed by the Funds upon certain redemptions of Class A shares
(or shares into which such Class A shares are exchanged) made within 12 months
of purchase, if such purchases were made at net asset value and triggered the
payment by the Distributor of the dealer's commission described above (i.e.,
purchases of $1,000,000 or more).
The Limited CDSC will be paid to the Distributor and will be equal to the lesser
of 1% of:
o the net asset value at the time of purchase of the Class A shares being
redeemed; or
o the net asset value of such Class A shares at the time of redemption.
For purposes of this formula, the "net asset value at the time of purchase" will
be the "net asset value at the time of purchase" of such Class A shares even if
those shares are later exchanged, and in the event of an exchange of such Class
A shares, the "net asset value of such shares at the time of redemption" will be
the net asset value of the shares into which the Class A shares have been
exchanged. The Limited CDSC on Class A shares will be waived on redemptions made
pursuant to a DLJ Winthrop Fund's systematic withdrawal plan under the same
circumstances as outlined in item (3) above related to the waiver of the CDSC on
Class B shares.
CLASS C SHARES
You may choose to purchase Class C shares at the Fund's net asset value,
although such shares will be subject to a 1% CDSC if you redeem your shares
within 1 year. If you exchange your shares for Class C shares of another DLJ
Winthrop Fund, the 1% CDSC also will apply to those Class C shares. The 1 year
period for the CDSC begins with the date of your original purchase, not the date
of the exchange for the other Class C shares. The 1% CDSC on Class C shares will
be waived under the circumstances that would result in a waiver of the CDSC on
Class B shares.
<PAGE>
CLASS D SHARES
Class D shares are offered only to employees of DLJ and its subsidiaries who are
eligible to participate in the DLJ 401(k) Retirement Savings Plan for Employees.
Class D shares are not subject to any sales charges or distribution fees. These
employees should contact the DLJ 401(k) Hotline at 1-877-401k -DLJ to learn how
to purchase Class D shares.
ADDITIONAL SHAREHOLDER SERVICES
The following privileges are provided by the Transfer Agent and do not apply to
Class D shares:
Exchange Privilege. You may exchange shares of Class A, Class B or Class C of a
Fund for shares of the same class in any other DLJ Winthrop Fund. Shareholders
whose initial investment was directly into a Money Fund may exchange such shares
for either Class A, Class B or Class C of the other DLJ Winthrop Opportunity
Funds or the DLJ Winthrop Focus Funds. Shares of each Money Fund purchased
pursuant to the DLJ Winthrop Funds' exchange privilege will be eligible for
exchange into the DLJ Winthrop Opportunity Funds or DLJ Winthrop Focus Funds
provided that the exchange is directed into the same class of shares upon which
the initial investment was made. Shareholders whose initial investment was
invested directly into a Money Fund will, upon an exchange request,
automatically be exchanged into Class A shares of the requested Fund (unless
otherwise indicated on the purchase application or by written notice to the
Transfer Agent). You should be aware that for federal income tax purposes an
exchange is treated as a sale and a purchase of shares which may result in
recognition of a gain or loss.
Automatic Monthly Investment Plan. You may elect on the Application to make
additional investments in a Fund automatically by authorizing DLJ Winthrop to
withdraw funds from your bank or other cash account and purchase additional
shares with those funds. You select the date (either the 10th, 15th or 20th of
each month) and amount (subject to a minimum of $25). The plan may be terminated
at any time without penalty by you or the Fund.
Automatic Exchange Plan. You may authorize the DLJ Winthrop Funds in advance to
exchange a set dollar amount of shares in one Fund for shares of the same class
of another Fund or for shares of the Money Funds on a monthly, quarterly,
semi-annual or annual basis under an Automatic Exchange Plan. The minimum
exchange amount under the Automatic Exchange Plan is $50. These exchanges are
subject to the terms of the Exchange Privilege described above.
Dividend Direction Option. A shareholder may elect on the Application to have
his or her dividends paid to another individual or directed for reinvestment
within the same class of another Fund provided that an existing account in such
other Fund is maintained by the shareholder.
Systematic Withdrawal Plan. Any shareholder who owns or purchases shares of a
Fund having a current net asset value of at least $10,000 may establish a
Systematic Withdrawal Plan under which the shareholder or a third party will
receive payment by check in a stated amount of not less than $50 on a monthly,
quarterly, semi-annual or annual basis. A CDSC which may otherwise be imposed on
a redemption will be waived in connection with redemptions made pursuant to DLJ
Winthrop Funds' Systematic Withdrawal Plan up to 1% monthly or 3% quarterly of
an account (excluding dividend reinvestment) not to exceed 12% over any 12 month
rolling period. Systematic withdrawals elected on a semi-annual or annual basis
are not eligible for the waiver.
Checkwriting Privileges. Shareholders of the Money Funds may redeem shares by
writing checks of at least $100 against their account balance. Investments in
the Money Funds will continue to earn dividends until a shareholder's check is
presented to the Money Funds for payment. Checks will be returned by the
Transfer Agent if there are insufficient shares to meet the withdrawal amount.
You should not attempt to close an account by check because the exact balance at
the time the check clears will not be known when the check is written. There is
currently no charge to shareholders for checkwriting, but the Money Funds
reserve the right to impose a charge in the future. The Money Funds
<PAGE>
may modify, suspend or terminate checkwriting privileges at any time upon notice
to shareholders and will terminate checkwriting privileges without notice for
accounts whose assets are exchanged completely out of the Money Funds. In
addition, Boston Safe Deposit & Trust., as agent for the Transfer Agent in
processing redemptions via the checkwriting privilege, reserves the right to
terminate checkwriting privileges at any time without notice to you.
Checkwriting privileges are not available for accounts subject to a CDSC.
Retirement Plans. DLJ Winthrop offers a range of qualified retirement plans
including Traditional, Educational and Roth IRAs, SEPs, SIMPLE plans and other
pension and profit sharing plans. Semper Trust Company serves as custodian under
these prototype retirement plans and charges an annual account maintenance fee
of $15 per participant, regardless of the number of Funds selected. For more
information you should write or telephone the Transfer Agent at 1-800-225-8011.
For a more detailed explanation of the retirement plans offered by the Funds,
see each Fund's Statement of Additional Information.
Additional information concerning shareholder services is available by
contacting the Funds at the address or telephone number listed on the last page
of this Prospectus.
The Funds do not permit market-timing. Do not invest in these Funds if you are a
market-timer. DLJ reserves the right to impose short-term redemption fees to
discourage market-timing in the Funds.
DISTRIBUTION CHARGES
Each Fund has adopted 12b-1 Plans pursuant to the rules of the 1940 Act. These
plans allow each Fund to collect distribution and service fees for the sale and
servicing of the individual classes of each Fund's shares. Since these fees are
paid out of each Fund's assets on an on-going basis, over time these fees will
increase the cost of your investment. These fees may cost you more than paying
other types of sales charges. The following payments were made in the fiscal
year ending October 31, 1999. The Funds do not pay any of the expenses for
distributing Class D shares.
FUND % OF AVERAGE
NET ASSETS' FEES PAID
- --------------------------------------------------------------------------------
Growth Fund Class A 0.30% $362,168
Growth Fund Class B 1.00% $252,991
Growth Fund Class C* 1.00% NA
- --------------------------------------------------------------------------------
Growth and Income Fund Class A 0.30% $522,846
Growth and Income Fund Class B 1.00% $389,799
Growth and Income Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
Small Company Value Fund Class A 0.30% $632,837
Small Company Value Fund Class B 1.00% $213,205
Small Company Value Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
Fixed Income Fund Class A 0.30% $133,853
Fixed Income Fund Class B 1.00% $54,120
Fixed Income Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
Municipal Trust Fund Class A 0.30% $114,538
Municipal Trust Fund Class B 1.00% $13,582
Municipal Trust Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
High Income Fund Class A 0.25% $13,858
High Income Fund Class B 1.00% $5,164
High Income Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
International Equity Fund Class A 0.25% $112,495
International Equity Fund Class B 1.00% $58,838
<PAGE>
International Equity Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
Developing Markets Fund Class A 0.25% $36,671
Developing Markets Fund Class B 1.00% $25,503
Developing Markets Fund Class C* 1.00% N/A
- --------------------------------------------------------------------------------
U.S. Government Money Fund 0.25% $146,518
Municipal Money Fund 0.25% $133,071
- --------------------------------------------------------------------------------
*Prior to the date of this prospectus, the Class C shares of each Fund were not
available for purchase.
[side bar]
Distribution and Service Fees:
Distribution and service fees are used to pay the Distributor to promote the
sale of shares and the servicing of accounts of each Fund.
The expenses incurred by the Distributor under the 12b-1 Plans include the
preparation, printing and distribution of prospectuses, sales brochures and
other promotional materials sent to prospective shareholders. They also include
purchasing radio, television, newspaper and other advertising and compensating
the Distributor's employees or employees of the Distributor's affiliates for
their distribution assistance.
Distribution fees also allow the Distributor to compensate broker/dealers or
other persons or entities for providing distribution assistance, as well as
financial intermediaries for providing administrative and accounting services
for their account holders.
[end side bar]
DIVIDEND AND DISTRIBUTION INFORMATION
Dividends are declared daily and paid monthly to shareholders of the Money
Funds, Fixed Income Fund, Municipal Trust Fund and the High Income Fund from net
investment income. Dividends are paid to shareholders of the Growth and Income
Fund quarterly, if net investment income has been earned, and to shareholders of
the Growth Fund, the Small Company Value Fund and the International Funds once a
year. Capital gains earned in any of the Funds are normally distributed to
shareholders once a year. For purposes of this calculation, net investment
income consists of all accrued income on fund assets less the Fund's expenses
applicable to that dividend period.
For your convenience, dividends and capital gains are automatically reinvested
in your Fund. If you ask us to pay the distributions in cash, the Fund will send
you a check instead of purchasing more shares of your Fund. You will receive a
confirmation that shows the payment amount and a summary of all transactions.
Checks are normally mailed within five business days of the payment date.
TAXES
As with any investment, you should consider how your investment in the Funds
will be taxed. If your account is not a tax-deferred retirement account, you
should be aware of these tax consequences. For federal income tax purposes, a
Fund's income and short-term capital gain distributions are taxed as ordinary
income. Long-term capital gain distributions are taxed as long-term capital
gains. Your distributions may also be subject to state and local income taxes.
The distributions are taxable when they are paid, whether you receive them in
cash or participate in the dividend reinvestment program. Each January, your
Fund will mail you a form indicating the federal tax status of your dividend and
capital gain distributions. For individuals, long-term capital gains are
generally subject to a maximum tax rate of 20%. If you hold shares in a
tax-deferred retirement account, your distributions will be taxed when you
receive a distribution from your tax-deferred account.
<PAGE>
Distributions to shareholders of tax-exempt interest income earned by the
Municipal Trust Fund and the Municipal Money Fund are not subject to federal
income tax if, at the close of each quarter of each Fund's taxable year, at
least 50% of the value of each Fund's total assets consists of tax-exempt
obligations. Both Funds intend to meet this requirement. Because the Municipal
Trust Fund and Municipal Money Fund can invest in taxable municipal bonds and
other taxable securities as well as tax-exempt municipal bonds, the portion of
their dividends exempt from or subject to regular federal income taxes cannot be
predicted. In addition, these distributions may also be subject to state and
local taxes.
If you are subject to the AMT, you should be aware that a portion of the
distributions out of tax-exempt interest earned by the Municipal Trust Fund and
the Municipal Money Fund may be taxable.
When you redeem your shares, the tax treatment of any gains or losses may be
affected by the length of time for which you hold your shares.
As a shareholder, you must provide your Fund with a correct taxpayer
identification number (generally your Social Security number) and certify that
you are not subject to backup withholding. If you fail to do so, the IRS can
require your Fund to withhold 31% of your taxable distributions and redemptions.
Federal law also requires your Fund to withhold 30% or the applicable tax treaty
rate from dividends paid to certain non-resident alien, non-U.S. partnership and
non-U.S. corporation shareholder accounts.
Please see the Statement of Additional Information for your Fund for more
information on the tax consequences of your investment. You should also consult
your own tax adviser for further information.
[side bar]
The Taxpayer Relief Act of 1997:
The Taxpayer Relief Act of 1997 made certain changes to capital gains tax rates.
Under this law, certain taxpayers will pay a lower tax rate when it comes to
capital gains.
The Fund will provide information relating to the portion of any Fund
distribution that is eligible for the reduced capital gains tax rate.
[end side bar]
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand your Fund's
financial performance for the past 5 years (or, if shorter, the period of the
Fund's operations.) Certain information reflects financial results for a single
Fund share. The total returns in the table represent the rate that an investor
would have earned (or lost) on an investment in the indicated Fund (assuming
reinvestment of all dividends and distributions). This information has been
audited by Ernst & Young LLP, the Funds' independent auditors, whose unqualified
reports, along with the Funds' financial statements, are included in the
Statements of Additional Information, which are available upon request.
Additional information about the performance of the Focus Funds and the
Opportunity Funds is contained in each Fund's annual report to shareholders,
which may be obtained without charge. Prior to February 28, 1996, the Focus
Funds offered only a single class of shares. Accordingly, the data presented
below with respect to Class A shares of the Focus Funds for periods prior to
such date have been obtained from the financial statements for the Focus Funds'
sole class of shares outstanding during such prior fiscal years.
<PAGE>
<TABLE>
<CAPTION>
Net Asset Net Net Realized Total from Dividends Distributions
Value Investment and Unrealized Investment from Net from Capital
Beginning Income/(Loss) Gains/(Losses) Operations Investment Gains
of Period on Securities Income
<S> <C> <C> <C> <C> <C> <C>
GROWTH FUND CLASS A
Year Ended
October 31, 1999 $16.52 ($0.030)* $5.040 $5.010 $ -- ($0.260)
Year Ended
October 31, 1998 14.56 (0.003)* 2.882 2.879 (0.017) (0.902)
Year Ended 12.69 0.028 3.065 3.093 (0.048) (1.175)
October 31, 1997
Year Ended 11.35 0.053 2.107 2.160 (0.038) (0.782)
October 31, 1996
Year Ended 10.82 0.037 1.190 1.227 (0.012) (0.685)
October 31, 1995
Class B
Year Ended
October 31, 1999 16.25 (0.165)* 4.925 4.760 -- (0.260)
Year Ended 14.41 (0.115)* 2.857 2.742 -- (0.902)
October 31, 1998
Year Ended 12.63 (0.030) 3.016 2.986 (0.031) (1.175)
October 31, 1997
Year Ended 11.88 (0.013) 0.763 0.750 -- --
October 31, 1996+
CLASS D
Year Ended
October 31, 1999++ 20.29 0.005* 0.975 0.980 -- --
GROWTH AND INCOME FUND CLASS A
Year Ended
October 31, 1999 $22.60 $0.119* $2.872 $2.991 ($0.091) ($2.010)
Year Ended
October 31, 1998 20.09 0.202* 3.509 3.711 (0.170) (1.031)
Year Ended 17.18 0.211 4.588 4.799 (0.214) (1.675)
October 31, 1997
Year Ended 14.57 0.266 2.935 3.201 (0.241) (0.350)
October 31, 1996
Year Ended 13.38 0.254 1.769 2.023 (0.266) (0.567)
October 31, 1995
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
CLASS B
Year Ended
October 31, 1999 22.55 (0.042)* 2.882 2.840 (0.010) (2.010)
Year Ended 20.06 0.045* 3.500 3.545 (0.024) (1.031)
October 31, 1998
Year Ended 17.15 0.079 4.577 4.656 (0.071) (1.675)
October 31, 1997
Year Ended 16.05 0.136 1.109 1.245 (0.145) --
October 31, 1996+
CLASS D
Year Ended
October 31, 1999+++ 23.73 0.098* (0.260) (0.162) (0.068) --
SMALL COMPANY VALUE FUND CLASS A
Year Ended $19.54 $0.058* $1.009 $1.067 ($0.073) ($0.014)
October 31, 1999
Year Ended 23.34 0.066* (2.548) (2.482) (0.063) (1.255)
October 31, 1998
Year Ended 18.41 0.073 5.661 5.734 (0.081) (0.723)
October 31, 1997
Year Ended 16.61 0.084 2.162 2.246 (0.037) (0.409)
October 31, 1996
Year Ended 15.65 0.035 1.621 1.656 -- (0.696)
October 31, 1995
Class B
Year Ended 19.23 (0.143)* 1.057 0.914 -- (0.014)
October 31, 1999
Year Ended 23.12 (0.089)* (2.546) (2.635) -- (1.255)
October 31, 1998
Year Ended 18.34 (0.021) 5.576 5.555 (0.052) (0.723)
October 31, 1997
Year Ended 17.41 (0.023) 0.953 0.930 -- --
October 31, 1996+
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
FIXED INCOME FUND CLASS A
Year Ended $10.46 $0.496 ($0.525) ($0.029) ($0.496) ($0.105)
October 31, 1999
Year Ended 10.16 0.531 0.300 0.831 (0.531) --
October 31, 1998
Year Ended 10.07 0.575 0.090 0.665 (0.575) --
October 31, 1997
Year Ended 10.22 0.577 (0.150) 0.427 (0.577) --
October 31. 1996
Year Ended 9.66 0.588 0.560 1.148 (0.588) --
October 31, 1995
CLASS B
Year Ended 10.46 0.425 (0.525) (0.100) (0.425) (0.105)
October 31, 1999
Year Ended 10.16 0.456 0.300 0.756 (0.456) --
October 31, 1998
Year Ended 10.07 0.504 0.090 0.594 (0.504) --
October 31, 1997
Year Ended 10.22 0.339 (0.150) 0.189 (0.339) --
October 31, 1996+
CLASS D
Year Ended 10.09 0.263 (0.260) 0.003 (0.263) --
October 31, 1999+++
</TABLE>
+ For the period February 28, 1996 (commencement of offering of Class B
shares) to October 31, 1996.
++ For the period May 13,1999 (commencement of offering of Class D shares) to
October 31, 1999.
+++ For the period April 30, 1999 (commencement of offering of Class D shares)
to October 31, 1999.
* Based on average shares outstanding.
** Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of all dividends
and distributions at net asset value during the period, and redemption on
the last day of the period. An initial sales charge or contingent deferred
sales charge is not reflected in the calculation of total return.
<TABLE>
<CAPTION>
Total Net Asset Total Return ** Net Assets End Ratio of Ratio of Net
Distributions Value End of of Period (000 Expenses to Investment Income/ Portfolio
Period omitted) Average Net (Loss) to Average Turnover
Assets (2) Net Assets (2) Rate
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
($0.260) $21.27 30.77% $135,677 1.23% (0.16%) 34.7%
(0.919) 16.52 21.00 97,078 1.29 (0.02) 21.0
(1.223) 14.56 26.48 82,926 1.36 0.21 41.1
(0.820) 12.69 20.32 68,096 1.48 0.47 60.6
(0.697) 11.35 12.21 55,946 1.63 0.35 101.7
(0.260) 20.75 29.73 32,783 1.93 (0.86) 34.7
(0.902) 16.25 20.20 17,438 1.99 (0.72) 21.0
(1.206) 14.41 25.66 10,378 2.06 (0.51) 41.1
-- 12.63 6.40 3,177 2.17(1) (0.34)(1) 60.6
-- 21.27 4.83 4,839 1.17(1) 0.07(1) 34.7
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
($2.101) $23.49 14.37% $174,213 1.11% 0.52% 24.5%
(1.201) 22.60 19.14 163,936 1.13 0.92 32.7
(1.889) 20.09 30.53 145,586 1.22 1.15 19.8
(0.591) 17.18 22.60 113,803 1.36 1.68 44.0
(0.833) 14.57 16.10 87,975 1.58 1.94 31.8
(2.020) 23.37 13.66 41,144 1.81 (0.18) 24.5
(1.055) 22.55 18.29 33,325 1.83 0.22 32.7
(1.746) 20.06 29.59 19,664 1.92 0.39 19.8
(0.145) 17.15 7.67 6,545 1.99(1) 1.06(l) 44.0
(0.068) 23.50 (0.67) 48,152 0.97(1) 0.99(1) 24.5
- ----------------------------------------------------------------------------------------------------------------------
(0.087) $20.52 5.47% $188,192 1.37% 0.33% 29.6%
(1.318) 19.54 (11.20) 237,873 1.29 0.30 41.5
(0.804) 23.34 32.48 283,001 1.35 0.37 21.1
(0.446) 18.41 13.80 227,716 1.47 0.48 35.1
(0.696) 16.61 11.10 202,730 1.64 0.23 25.1
(0.014) 20.13 4.75 19,257 2.07 (0.71) 29.6
(1.255) 19.23 (11.98) 22,284 1.99 (0.40) 41.5
(0.775) 23.12 31.55 18,395 2.05 (0.32) 21.1
-- 18.34 5.28 6,305 2.15(1) (0.34)(1) 35.1
- ----------------------------------------------------------------------------------------------------------------------
($0.601) $9.83 (0.26%) $43,060 1.00% 4.91% 84.3%
(0.531) 10.46 8.46 47,834 1.00 5.24 114.0
(0.575) 10.16 6.84 54,755 1.00 5.74 119.3
(0.577) 10.07 4.34 56,388 1.00 5.72 90.2
(0.588) 10.22 12.23 53,885 1.00 5.90 66.1
(0.530) 9.83 (0.97) 4,471 1.70 4.21 84.3
(0.456) 10.46 7.71 5,849 1.70 4.50 114.0
(0.504) 10.16 6.10 3,375 1.70 4.99 119.3
(0.339) 10.07 2.23 1,629 1.70(1) 5.03(1) 90.2
(0.263) 9.83 0.04 116,424 0.70(1) 6.30(1) 84.3
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Annualized
(2) See footnote (3) on page 51.
<PAGE>
<TABLE>
<CAPTION>
Net Asset Net Net Realized Contrib- Total from Dividends Distrib Tax
Value Investment and Unrealized ution Investment from Net -utions Return
Beginning of Income/ Gains/(Losses) from Operations Investment from Capital of
Period (Loss) on Securities Sub-Advisor Income Gains Capital
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MUNICIPAL TRUST FUND
CLASS A
Year Ended October 31, $10.53 $0.377 ($0.480) $ -- ($0.103) ($0.377) $ -- $ --
1999
Year Ended October 31, 10.29 0.383 0.240 -- 0.623 (0.383) -- --
1988
Year Ended October 31, 10.01 0.445 0.280 -- 0.725 (0.445) -- --
1997
Year Ended October 31, 10.06 0.425 (0.050) -- 0.375 (0.425) -- --
1996
Year Ended October 31, 9.51 0.389 0.550 -- 0.939 (0.389) -- --
1995
CLASS B
Year Ended October 31, 10.53 0.305 (0.480) -- (0.175) (0.305) -- --
1999
Year Ended October 31, 10.29 0.318 0.240 -- 0.558 (0.318) -- --
1998
Year Ended October 31, 10.01 0.370 0.280 -- 0.650 (0..370) -- --
1997
Year Ended October 31, 10.12 0.248 (0.110) -- 0.138 (0.248) -- --
1996+
- ------------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY
FUND CLASS A
Year Ended October 31, $12.20 ($0.060)** $2.560 -- $2.500 $-- ($0.700) --
1999
Year Ended October 31, 11.42 (0.060)** 0.990 -- 0.930 (0.060) (0.090) --
1998
Year Ended October 31, 10.38 (0.070)** 1.110 -- 1.040 -- -- --
1997
Year Ended October 31, 9.58 (0.040)** 0.840 -- 0.800 -- -- --
1996
Year Ended October 31, 10.00 -- (0.420) (0.420) -- -- --
1995*
CLASS B
Year Ended October 31, 11.98 (0.150)** 2.500 -- 2.350 -- (0.700) --
1999
Year Ended October 31, 11.24 (0.150)** 0.980 -- 0.830 -- (0.090) --
1998
Year Ended October 31, 10.29 (0.150)** 1.100 -- 0.950 -- -- --
1997
Year Ended October 31, 9.57 (0.130)** 0.850 -- 0.720 -- -- --
1996
Year Ended October 31, 10.00 (0.020)** (0.410) -- (0.430) -- -- --
1995*
CLASS D
Year Ended October 31, 12.69 (0.140)** 1.470 -- 1.330 -- -- --
1999+++
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
DEVELOPING MARKETS
FUND CLASS A
Year Ended October 31, $7.14 $0.030** $2.580 $0.230 $2.840 ($0.010) -- $(0.020)
1999
Year Ended October 31, 9.52 0.020** (2.400) -- (2.380) -- -- --
1998
Year Ended October 31, 9.96 (0.020)** (0.400) -- (0.420) -- (0.020) --
1997
Year Ended October 31, 9.53 (0.010)** 0.440 -- 0.430 -- -- --
1996
Year Ended October 31, 10.00 -- (0.470) -- (0.470) -- -- --
1995*
CLASS B
Year Ended 6.96 (0.030)** 2.500 $0.230 $2.700 $ -- $ -- --
October 31, 1999
Year Ended October 31, 9.36 (0.040)** (2.360) -- (2.400) -- -- --
1998
Year Ended October 31, 9.86 (0.190)** (0.290) -- (0.480) -- (0.020) --
1997
Year Ended October 31, 9.52 (0.080)** 0.420 -- 0.340 -- -- --
1996
Year Ended October 31, 10.00 (0.010)** (0.470) (0.480) -- --
1995*
- ------------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL MONEY FUND
Year Ended $1.00 $0.023 $ -- $ -- $0.023 ($0.023) $ -- $ --
October 31, 1999
Year Ended October 31, 1.00 0.027 -- -- 0.027 (0.027) -- --
1998
Year Ended October 31, 1.00 0.020 -- -- 0.020 (0.020) -- --
1997***
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT MONEY FUND
Year Ended October 31, $1.00 $0.042 $ -- $ -- $0.042 ($0.042) $ -- $ --
1999
Year Ended October 31, 1.00 0.047 -- -- 0.047 (0.047) -- --
1998
Year Ended October 31, 1.00 0.032 -- -- 0.032 (0.032) -- --
1997***
- ------------------------------------------------------------------------------------------------------------------------------------
HIGH INCOME FUND CLASS A
Year Ended October 31, $10.00 $0.563 ($0.340) -- $0.223 ($0.563) $ -- $ --
1999++
Class B
Year Ended October 31, 10.00 0.504 (0.340) -- 0.164 (0.504) -- --
1999++
Class D
Year Ended October 31, 10.23 0.414 (0.580) -- (0.166) (0.414) -- --
1999++++
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
* Commencement of operations for the International Equity Fund and the
Developing Markets Fund was September 8, 1995.
** Based on average shares outstanding.
*** Commencement of operations for the Municipal Money Fund and the U.S.
Government Money Fund was February 24, 1997.
+ For the period February 28, 1996 (commencement of offering of Class B
shares) to October 31, 1996.
++ Commencement of operations for the High Income Fund was March 8, 1999.
+++ For the period May 17, 1999 (commencement of offering of Class D Shares)
to October 31, 1999.
++++ For the period May 13,1999 (commencement of offering of Class D shares) to
October 31, 1999.
<TABLE>
<CAPTION>
Total Net Asset Total Return(2) Net Assets End Ratio of Ratio of Net
Distributions Value End of of Period (000 Expenses to Investment Income Portfolio
Period omitted) Average Net (Loss) to Average Turnover
Assets (3) Net Assets (3) Rate
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
($0.377) $10.05 (1.02%) $29,912 1.00% 3.65% 76.5%
(0.383) 10.53 6.28 44,306 1.00 3.78 51.5
(0.445) 10.29 7.37 35,878 0.70 4.38 84.3
(0.425) 10.01 3.83 38,794 0.80 4.26 79.3
(0.389) 10.06 10.06 39,059 1.00 3.97 49.3
(0.305) 10.05 (1.71) 1,044 1.70 2.94 76.5
(0.318) 10.53 5.54 1,430 1.70 3.04 51.5
(0.370) 10.29 6.62 546 1.40 3.66 84.3
(0.248) 10.01 1.42 489 1.23(1) 3.81(1) 79.3
($0.700) $14.00 21.76% $48,181 2.15% (0.44)% 82.0%
(0.150) 12.20 8.20 44,286 2.15 (0.49) 69.7
-- 11.42 10.02 44,316 2.15 (0.59) 73.9
-- 10.38 8.35 42,170 2.15 (0.39) 94.1
-- 9.58 (4.20) 28,819 2.15(1) (0.02)(1) --
(0.700) 13.63 20.86 5,527 2.90 (1.18) 82.0
(0.090) 11.98 7.43 6,133 2.90 (1.24) 69.7
-- 11.24 9.23 6,821 2.90 (1.32) 73.9
-- 10.29 7.52 4,955 2.90 (1.25) 94.1
-- 9.57 (4.30) 1,803 2.90(1) (1.77)(1) --
-- 14.02 10.48% 1,586 1.90(1) (1.19)(1) 82.0
</TABLE>
<PAGE>
<TABLE>
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
($0.030) $9.95 39.82% $16,023 2.15% 0.32% 36.9%
-- 7.14 (25.00) 16,355 2.15 0.22 43.6
(0.020) 9.52 (4.18) 29,402 2.15 (0.17) 52.8
-- 9.96 4.51 36,918 2.15 (0.14) 26.8
-- 9.53 (4.70) 14,622 2.15(1) 0.32(1) --
-- 9.66 38.79 2.685 2.90 (0.36) 36.9
-- 6.96 (25.64) 2,509 2.90 (0.50) 43.6
(0.020) 9.36 (4.83) 4,941 2.90 (1.74) 52.8
-- 9.86 3.57 3,641 2.90 (0.83) 26.8
-- 9.52 (4.80) 1,004 2.90(1) (1.00)(1) --
- ----------------------------------------------------------------------------------------------------------------------
($0.023) $1.00 2.37% $44,347 0.90% 2.33% N/A
(0.027) 1.00 2.72 57,778 0.90 2.68 N/A
(0.020) 1.00 2.90(1) 38,681 0.90(1) 2.87(1) N/A
- ----------------------------------------------------------------------------------------------------------------------
($0.042) $1.00 4.26% $59,877 0.90% 4.19% N/A
(0.047) 1.00 4.79 56,697 0.90 4.68 N/A
(0.032) 1.00 4.68(l) 35,174 0.90(1) 4.65(1) N/A
- ----------------------------------------------------------------------------------------------------------------------
($0.563) $9.66 2.19% $10,488 1.10%(1) 8.61%(1) 188.4%
(0.504) 9.66 1.60 1,447 1.85(1) 7.83(1) 188.4
(0.414) 9.65 (1.63) 926 0.85(1) 9.36(1) 188.4
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Annualized
(2) Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of all dividends
and distributions at net asset value during the period, and redemption on
the last day of the period. An initial sales charge or contingent deferred
sales charge is not reflected in the calculation of total return. Total
return calculated for a period of less than one year is not annualized
except for the Money Funds. Total return for the year ended October 31,
1999 excluding the effect of the contribution from the subadvisor for
realized and unrealized securities losses was 36.59% and 35.49% for the
Developing Markets Fund Class A and B Shares, respectively.
(3) Net of voluntary assumption by the investment adviser of expenses,
expressed as a percentage of average net assets, as follows: Fixed Income
Fund Class A shares, .14%, .30%, .30%, .34%, and .51%, for the years
ended 10/31/99, 98, 97, 96, and 95 respectively; Fixed Income Fund Class B
shares, .14%, .30%, and .30% for the years ended 10/31/99, 98 and 97, and
.34% (annualized) for the period 2/28/96 through 10/31/96; Fixed Income
Fund Class D shares, .14% for the period 4/30/99 through 10/31/99;
Municipal Trust Fund Class A shares, .42%, .41%, .74%, .64%, and .58%,
(annualized) for the years ended 10/31/99, 98, 97, 96, and 95,
respectively; Municipal Trust Fund Class B shares, .42 %, .41 % and .74%
for the years ended 10/31/99, 98 and 97, and .64% (annualized) for the
period 2/28/96 through 10/31/96; Developing Markets Fund Class A and Class
B shares, .76%, .61%, .34%, .54% and .60% (annualized) for the years ended
10/31/99, 98, 97, 96 and 95, respectively; International Equity Fund Class
A and Class B shares, .04%,.10%, .18%, .27% and .60% (annualized) for the
years ended 10/31/99, 98, 97, 96 and 95, respectively; International
Equity Fund Class D shares, .04% (annualized) for the period 5/17/99
through 10/31/99; Municipal Money Fund, .14%, .15% and .40% (annualized)
for the years ended 10/31/99, 98 and 97, respectively; and U.S. Government
Money Fund, .19%, .25% and .45% (annualized) for the years ended 10/31/99,
98, and 97, respectively; and High Income Fund Class A, Class B and Class
D shares 1.43% (annualized) for the period 3/8/99 through 10/31/99.
BACK COVER
<PAGE>
FOR MORE INFORMATION
General Information and Other Available Information
The Funds send out a semi-annual report and an annual report to all
shareholders. These reports include a list of your Fund's investments and
financial statements. The annual report contains a statement from the Fund's
Adviser discussing market conditions and investment strategies that
significantly affected the Fund's performance during its last fiscal year.
The Funds have Statements of Additional Information that contain additional
information on all aspects of the Funds and are incorporated by reference into
this Prospectus. The Statements of Additional Information have been filed with
the Securities and Exchange Commission and are available for review at the SEC's
Public Reference Room in Washington, DC (1-202-942-8090) or on the SEC's web
site at http://www.sec.gov. You can also obtain copies of Fund documents filed
with the SEC by electronic request at the following e-mail address:
[email protected], or by writing:
Securities and Exchange Commission
Public Reference Section
Washington, DC 20549-0102
Payment of a duplicating fee may be required.
Shareholders may obtain any of these documents free of charge and may request
other information about the Funds by calling 800-225-8011.
DLJ Winthrop Funds
PFPC, Inc.
P.O. Box 61503
King of Prussia, PA. 19406-0903
DLJ WINTHROP FUNDS
SEC file numbers: Focus Funds 811-04604
Opportunity Funds 811-9054
