BT GLOBAL INVESTORS, 497, 1996-02-21

BT GLOBAL INVESTORS
497, 1996-02-21

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BT ADVISOR FUNDS

GLOBAL HIGH YIELD SECURITIES FUND
CAPITAL APPRECIATION FUND
SMALL CAP FUND
INTERNATIONAL EQUITY FUND
PACIFIC BASIN EQUITY FUND
LATIN AMERICAN EQUITY FUND

PROSPECTUS: JANUARY 16, 1996
BT Advisor Funds (the "Trust") is an open-end, management investment company
(mutual fund) which currently consists of ten funds. Shares of the six funds
listed above (each, a "Fund") are offered by this prospectus.

UNLIKE OTHER OPEN-END MANAGEMENT INVESTMENT COMPANIES (MUTUAL FUNDS), EACH FUND
SEEKS TO ACHIEVE ITS INVESTMENT OBJECTIVE BY INVESTING ALL OF ITS INVESTABLE
ASSETS ("ASSETS") IN THE CORRESPONDING PORTFOLIO WHICH IS A SEPARATE FUND WITH
AN IDENTICAL INVESTMENT OBJECTIVE. SEE "SPECIAL INFORMATION CONCERNING
MASTER-FEEDER FUND STRUCTURE" ON PAGE 13.

Bankers Trust Company ("Bankers Trust") is the investment adviser (the
"Adviser") of each Portfolio.

Please read this Prospectus before investing, and keep it on file for future
reference. It contains important information, including how each Fund invests
and the services available to shareholders.

To learn more about each Fund and its investments, investors can obtain a copy
of the Fund's Statement of Additional Information (the "SAI"), dated January 16,
1996, which contains each Portfolio's most recent financial report and portfolio
listing. The SAI has been filed with the Securities and Exchange Commission (the
"SEC") and is incorporated herein by reference. For a free copy of this
document, call (800) 730-1313 or contact the Trust at 6 St. James Avenue,
Boston, MA 02116, or an Investment Professional.

MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY, BANKERS
TRUST OR ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.

The Global High Yield Securities Portfolio and Latin American Equity Portfolio
may invest in lower-quality debt securities, sometimes called "junk bonds." The
Global High Yield Securities Portfolio may invest in these types of securities
without limit. Investors should consider that these securities carry greater
risks, such as the risk of default, than other debt securities. Refer to "Risk
Factors and Certain Securities and Investment Practices -- Risks of Investing in
High Yield Securities (Junk Bonds)" on page 13 for further information.

The Latin American Equity Portfolio and Global High Yield Securities Portfolio
may borrow money for investment in securities. Such leverage will exaggerate any
increase or decrease the value of shares in the Funds. Borrowing also involves
costs to the Portfolio. See "Risk Factors and Certain Securities and Investment
Practices -- Leverage" on page 11 herein. Each of these Funds may be considered
a speculative investment and is designed for aggressive investors.

LIKE SHARES OF ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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TABLE OF CONTENTS
- ------------------------------------------------------------------------------
PAGE
..............................................................................

THE FUNDS ................................................................. 3
WHO MAY WANT TO INVEST
INVESTMENT PRINCIPALS AND RISKS
Each Fund's overall approach to investing.
EXPENSE SUMMARY
Each Fund's sales charges and annual operating expenses.

THE FUNDS IN DETAIL ....................................................... 6
INVESTMENT OBJECTIVES AND POLICIES
RISK FACTORS AND CERTAIN SECURITIES AND INVESTMENT PRACTICES
SPECIAL INFORMATION CONCERNING MASTER-FEEDER FUND STRUCTURE
SECURITIES AND INVESTMENT PRACTICES
PERFORMANCE
How each Fund has done over time.
MANAGEMENT OF THE TRUST AND THE PORTFOLIOS

ACCOUNT INFORMATION ....................................................... 22
TYPES OF ACCOUNTS
Different ways to set up your account, including tax-sheltered retirement
plans.
HOW TO BUY SHARES
Opening an account and making additional investments.
HOW TO SELL SHARES
Taking money out and closing your account.
INVESTOR SERVICES
To help you manage your account.

SHAREHOLDER AND ACCOUNT POLICIES .......................................... 27
DIVIDENDS, CAPITAL GAINS AND TAXES
VALUATION DETAILS
Share price calculations and the timing of purchases and redemptions.
EXCHANGE LIMITATIONS
SALES CHARGE REDUCTIONS AND WAIVERS
ADDITIONAL INFORMATION ABOUT THE TRUST AND PORTFOLIOS

APPENDIX .................................................................. 34
- ------------------------------------------------------------------------------
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THE FUNDS
The Trust seeks to achieve the investment objective of each Fund by investing
all the Assets of the Fund in the corresponding Portfolio.

GLOBAL HIGH YIELD SECURITIES FUND'S investment objective is high current income
from investment in a non-diversified portfolio of high yield, non-investment
grade debt securities issued in many of the world's securities markets. Capital
appreciation will be considered when consistent with the primary investment
objective of high current income. See "Risk Factors and Certain Securities and
Investment Practices."

CAPITAL APPRECIATION FUND'S investment objective is long-term capital growth;
the production of any current income is secondary to this objective. The
Portfolio invests primarily in growth-oriented common stocks of medium sized
domestic corporations and, to a lesser extent, foreign corporations. See "Risk
Factors and Certain Securities and Investment Practices."

SMALL CAP FUND'S investment objective is long-term capital growth; the
production of any current income is secondary to this objective. The Portfolio
seeks to provide long-term capital growth by investing primarily in equity
securities of smaller sized growth companies. See "Risk Factors and Certain
Securities and Investment Practices."

INTERNATIONAL EQUITY FUND'S investment objective is long-term capital
appreciation from investment in foreign equity securities (or other securities
with equity characteristics); the production of any current income is incidental
to this objective. The Portfolio invests primarily in established companies
based in developed countries outside the United States, but the Portfolio may
also invest in emerging market securities. See "Risk Factors and Certain
Securities and Investment Practices."

PACIFIC BASIN EQUITY FUND'S investment objective is long-term capital
appreciation from investment primarily in the equity securities (or other
securities with equity characteristics) of companies domiciled in, or doing
business in the Pacific Basin region, other than Japan; the production of any
current income is incidental to this objective. See "Risk Factors and Certain
Securities and Investment Practices."

LATIN AMERICAN EQUITY FUND'S investment objective is long-term capital
appreciation from investment primarily in the equity securities (or other
securities with equity characteristics) of companies domiciled in, or doing
business in, Latin America; the production of any current income is incidental
to this objective. See "Risk Factors and Certain Securities and Investment
Practices."

WHO MAY WANT TO INVEST
Shares of each Fund are offered through this Prospectus to investors who engage
an Investment Professional.

The Capital Appreciation Fund, Small Cap Fund, International Equity Fund,
Pacific Basin Equity Fund, and Latin American Equity Fund are designed for
investors who are willing to accept short-term domestic and/or foreign stock
market fluctuations in pursuit of potentially high long-term returns. These
Funds invest for growth and do not pursue income.

In addition, the International Equity Fund, Global High Yield Securities Fund,
Latin American Equity Fund and Pacific Basin Equity Fund may also be appropriate
for investors who want to pursue their investment goals in markets outside of
the United States. By including international investments in your portfolio, you
can achieve an extra level of diversification and also participate in
opportunities around the world.

Each Fund is not in itself a balanced investment plan. Investors should consider
their investment objective and tolerance for risk when making an investment
decision. When investors sell their Fund Shares, they may be worth more or less
than what they originally paid for them.

INVESTMENT PRINCIPLES AND RISKS
The value of each Portfolio's investments varies based on many factors. The
value of bonds fluctuates based on changes in domestic or foreign interest
rates, the credit quality of the issuer, market conditions, and other economic
and political news. In general, bond prices rise when interest rates fall, and
vice versa. This effect is usually more pronounced for longer-term securities.
Lower-quality securities offer higher yields, but also carry more risk.

Stock values fluctuate, sometimes dramatically, in response to the activities of
individual companies and general market and economic conditions. Over time,
however, stocks have shown greater long-term growth potential than other types
of securities.

Because many foreign investments are denominated in foreign currencies, changes
in the value of these currencies can significantly affect a Fund's share price.
General economic factors in the various world markets can also impact the value
of an investor's investment, especially for securities in emerging markets. Many
investments in emerging markets can be considered speculative, and therefore may
offer higher income (for debt funds) and total return potential, but
significantly greater risk.

The Global High Yield Securities Portfolio is classified as a "non-diversified"
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), and may invest a greater portion of its assets in a single issuer
than a diversified fund. As a result, this Portfolio may be more susceptible to
any single economic, political or regulatory occurrence than a diversified fund.
See "Risk Factors and Certain Securities and Investment Practices --
Non-Diversified Fund" for more information.

Bankers Trust may use various investment techniques to hedge a Portfolio's
risks, but there is no guarantee that these strategies will work as intended.
When an investor sells their Fund shares ("Shares"), they may be worth more or
less than what they originally paid for them. See "Risk Factors and Certain
Securities and Investment Practices" for more information.

EXPENSE SUMMARY
ANNUAL OPERATING EXPENSES are paid out of the assets of each Portfolio and Fund.
Each Portfolio pays an investment advisory fee and an administrative services
fee to Bankers Trust. Each Fund incurs expenses such as maintaining shareholder
records and furnishing shareholder statements. Each Fund must provide financial
reports.

The following table provides: (i) a summary of expenses relating to purchases
and sales of the Shares of each Fund and the annual operating expenses of the
Fund and expenses of the corresponding Portfolio, in the aggregate, as a
percentage of average daily net assets of each Fund; and (ii) an example
illustrating the dollar cost of such expenses on a $1,000 investment in each
Fund. THE TRUSTEES OF THE TRUST BELIEVE THAT THE AGGREGATE PER SHARE EXPENSES
OF EACH FUND AND THE CORRESPONDING PORTFOLIO WILL BE LESS THAN OR
APPROXIMATELY EQUAL TO THE EXPENSES WHICH THE FUND WOULD INCUR IF THE TRUST
RETAINED THE SERVICES OF AN INVESTMENT ADVISER AND THE ASSETS OF EACH FUND
WERE INVESTED DIRECTLY IN THE TYPE OF SECURITIES BEING HELD BY THE
CORRESPONDING PORTFOLIO.
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SHAREHOLDER TRANSACTION EXPENSES (WITH THE EXCEPTION OF GLOBAL HIGH YIELD
SECURITIES FUND)
Maximum Sales Charge on Purchases
(as a percentage of offering price) 4.75%
..............................................................................
Maximum Sales Charge on Reinvested Distributions None
..............................................................................
Redemption Fee None
..............................................................................
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GLOBAL HIGH YIELD SECURITIES FUND:
Maximum Sales Charge on Purchases
(as a percentage of offering price) 3.75%
..............................................................................
Maximum Sales Charge on Reinvested Distributions None
..............................................................................
Redemption Fee None
..............................................................................
Shareholder transaction expenses are charges paid when investors buy, sell,
exchange, or hold Shares of a Fund. Lower front-end sales charges may be
available with purchases of $50,000 or more and/or in conjunction with various
programs. See "Valuation Details," on page 29 for an explanation of how and
when these charges apply.
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ANNUAL OPERATING EXPENSES

GLOBAL HIGH YIELD SECURITIES FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.41%
12b-1 fees 0.35
Other expenses (after reimbursements or waivers) 0.74
..............................................................................
Total operating expenses (after reimbursements or waivers) 1.50%
..............................................................................

CAPITAL APPRECIATION FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.52%
12b-1 fees 0.50
Other expenses (after reimbursements or waivers) 0.48
..............................................................................
Total operating expenses (after reimbursements or waivers) 1.50%
..............................................................................

SMALL CAP FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.37%
12b-1 fees 0.50
Other expenses (after reimbursements or waivers) 0.63
..............................................................................
Total operating expenses (after reimbursements or waivers) 1.50%
..............................................................................

INTERNATIONAL EQUITY FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.56%
12b-1 fees 0.50
Other expenses (after reimbursements or waivers) 0.64
..............................................................................
Total operating expenses (after reimbursements or waivers) 1.70%
..............................................................................

PACIFIC BASIN EQUITY FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.74%
12b-1 fees 0.50
Other expenses (after reimbursements or waivers) 0.61
..............................................................................
Total operating expenses (after reimbursements or waivers) 1.85%
..............................................................................

LATIN AMERICAN EQUITY FUND
..............................................................................
Investment advisory fee (after reimbursement or waiver) 0.41%
12b-1 fees 0.50
Other expenses (after reimbursements or waivers) 1.34
..............................................................................
Total operating expenses (after reimbursements or waivers) 2.25%
..............................................................................

EXPENSE TABLE EXAMPLE:
An investor would pay the following expenses, including the maximum front-end
sales charge on a $1,000 investment, assuming (1) 5% annual return and (2)
redemption at the end of each time period:

EXAMPLES 1 YEAR 3 YEARS
..............................................................................
Global High Yield Securities Fund $53 $ 83
Capital Appreciation Fund $62 $ 93
Small Cap Fund $62 $ 93
International Equity Fund $64 $ 99
Pacific Basin Equity Fund $65 $103
Latin American Equity Fund $69 $114
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The expense table and the example above show the costs and expenses that an
investor will bear directly or indirectly as a shareholder of a Fund. Bankers
Trust has voluntarily agreed to waive a portion of its investment advisory fee
with respect to each Portfolio. Without such waiver, each Portfolio's investment
advisory fee would be equal to the following: Global High Yield Securities
Portfolio -- 0.80% Capital Appreciation Portfolio -- 0.65%; Small Cap Portfolio
- -- 0.65%; International Equity Portfolio -- 0.65%; Pacific Basin Equity
Portfolio -- 0.75%; and Latin American Equity Portfolio -- 1.00%. The expense
table and the example reflect a voluntary undertaking by Bankers Trust or
Signature Broker-Dealer Services, Inc. ("SBDS"), as the distributor (the
"Distributor") of the Shares of each Fund, to waive or reimburse expenses such
that the total operating expenses of each Fund and the corresponding Portfolio
(as a percentage of the Fund's average daily net assets) will not exceed the
following: Global High Yield Securities Fund -- 1.50%; Capital Appreciation Fund
- -- 1.50%; Small Cap Fund -- 1.50%; International Equity Fund -- 1.70%; Pacific
Basin Equity Fund -- 1.85%; and Latin American Equity Fund -- 2.25%. In the
absence of this undertaking, assuming total assets of $25 million in each Fund,
it is estimated that "Total Operating Expenses" would be as follows: Global High
Yield Securities Fund -- 2.82%; Capital Appreciation Fund -- 2.41%; Small Cap
Fund -- 2.41% International Equity Fund -- 2.67%; Pacific Basin Equity Fund --
2.78%; and Latin American Equity Fund -- 3.18%. THE EXAMPLE SHOULD NOT BE
CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY
BE GREATER OR LESS THAN THOSE SHOWN. Moreover, while each example assumes a 5%
annual return, actual performance will vary and may result in a return greater
or less than 5%.

12b-1 fees for each Fund include a shareholder service fee and a distribution
fee. Shareholder service fees are paid by a Fund to SBDS to enable SBDS to
compensate Investment Professionals for providing personal shareholder service
and/or maintenance of shareholder accounts. Distribution fees are paid by a Fund
to SBDS to compensate Investment Professionals for services and expenses in
connection with the distribution of the applicable Fund's shares. Long-term
shareholders may pay more than the economic equivalent of the maximum sales
charges permitted by the National Association of Securities Dealers, Inc.
("NASD"), due to 12b-1 fees.

For more information about each Fund's and each Portfolio's expenses see
"Management of the Trust and the Portfolios" and "Valuation Details."

THE FUNDS IN DETAIL

INVESTMENT OBJECTIVES AND POLICIES
The Trust seeks to achieve the investment objective of each Fund by investing
all of its Assets in the corresponding Portfolio, which has the same investment
objective as the Fund. Since the investment characteristics of each Fund will
correspond directly to those of the corresponding Portfolio, the following is a
discussion of the various investments of and techniques employed by each
Portfolio. Additional information about the investment policies of each
Portfolio appears in "Risk Factors and Certain Securities and Investment
Practices" in this Prospectus and in the Funds' SAI. There can be no assurance
that the investment objective of either a Fund or the corresponding Portfolio
will be achieved.

The GLOBAL HIGH YIELD SECURITIES PORTFOLIO'S investment objective is high
current income from investment in a non-diversified portfolio of high yield
non-investment grade debt securities issued in many of the world's securities
markets. Capital appreciation will be considered when consistent with the
primary investment objective of high current income. The Portfolio intends to
invest in Brady bonds and other sovereign debt and in high risk, lower quality
debt securities commonly referred to as "junk bonds" and regarded as
predominantly speculative with respect to the issuer's capacity to pay interest
and repay principal in accordance with the terms of the obligation as well as in
the debt securities of issuers located in emerging markets, Brady bonds and
other sovereign debt.

Under normal circumstances, at least 65% of the Portfolio's assets will be
invested in high yield, non-investment grade debt securities of both
governmental and corporate issuers in both the major industrialized markets and
the so-called "emerging markets." See "Risk Factors and Certain Securities and
Investment Practices -- Risks of Investing in Foreign Securities" and "-- Risk
of Investing in Emerging Markets."

Although Bankers Trust considers both industrialized and emerging countries
eligible for investment pursuant to the Portfolio's objective, the Portfolio
will not be invested in all such markets at all times. Furthermore, investing in
some emerging markets may be neither feasible nor desirable from time to time,
due to the lack of adequate custodial arrangements for the Portfolio's assets,
exchange controls and overly burdensome repatriation rules, the lack of
organized and liquid securities markets, and unacceptable political risks. Under
normal circumstances, the Portfolio will invest in at least three emerging
markets countries. See "Risk Factors and Certain Securities and Investment
Practices -- Risks of Investing in Foreign Securities" and " -- Risk of
Investing in Emerging Markets."

The Portfolio generally invests in securities which are rated BBB or lower by
Standard & Poor's Corporation ("S&P") or Baa or lower by Moody's Investors
Service, Inc. ("Moody's") or, if unrated, of comparable quality in the opinion
of Bankers Trust. Securities which are rated BBB by S&P or Baa by Moody's
possess some speculative characteristics. A description of the rating categories
is attached to this Prospectus. THERE IS NO LOWER LIMIT WITH RESPECT TO THE
RATING CATEGORIES FOR SECURITIES IN WHICH THE PORTFOLIO MAY INVEST. See "Risk
Factors and Certain Securities and Investment Practices -- Risks of Investing In
High Yield Securities (Junk Bonds)."

The Portfolio is not required to dispose of debt securities whose credit quality
declines at some point after the security is purchased; however, no more than
25% of the Portfolio's assets will be invested at any time in securities rated
less than CCC by S&P or Caa by Moody's or, if unrated, of comparable quality in
the opinion of Bankers Trust. S&P's lowest rating for bonds is CI, which is
reserved for income bonds on which no interest is being paid and D, which is
reserved for debt in default and in respect of which payment of interest or
repayment of principal is in arrears. Moody's lowest rating is C, which is
applied to bonds which have extremely poor prospects for ever attaining any real
investment standing. The Portfolio may, from time to time, purchase defaulted
debt securities if, in the opinion of Bankers Trust, the issuer may resume
interest payments in the near future. The Portfolio will not invest more than
10% of its total assets (at the time of purchase) in defaulted debt securities,
which may be illiquid. Other than as set forth above, there is no restriction on
the percentage of the Portfolio's assets which may be invested in bonds of a
particular rating.

The Portfolio invests in debt obligations allocated among diverse markets and
denominated in various currencies, including multi-currency units such as
European Currency Units ("ECUs"). The Portfolio may purchase securities that are
issued by the government or a company or financial institution of one country
but denominated in the currency (or multi-currency unit) of another country.

The Portfolio is classified as a "non-diversified" fund under the 1940 Act,
which means the Portfolio is not limited by the 1940 Act in the proportion of
its assets that may be invested in a single issuer. The Portfolio may,
therefore, invest in the securities of individual issuers to a greater degree
than a diversified fund and may be more susceptible to any single economic,
political or regulatory occurrence affecting those issuers. However, in order to
enable the Fund (and other registered investment companies which may in the
future invest all their assets in the Portfolio) to qualify as a regulated
investment company (a "RIC") the Portfolio must comply with the diversification
requirement of Subchapter M of the Internal Revenue Code of 1986, as amended
(the "Code"), for U.S. federal income tax purposes. See "Risk Factors and
certain Securities and Investment Practices -- Non-Diversified Fund" herein.

Other Investments and Investment Techniques. The Portfolio may also utilize the
following investments and investment techniques and practices: short-term
investments, floating rate bonds, zero coupon bonds, sovereign and supranational
debt obligations, Brady bonds, loan participations and assignments, convertible
bonds, preferred stock, foreign currency exchange transactions, options on
foreign currencies, options on foreign bond indices, futures contracts on
foreign bond indices, options on futures contracts, Rule 144A securities,
when-issued or delayed delivery securities, securities lending, repurchase
agreements and reverse repurchase agreements. See "Risk Factors and Certain
Securities and Investment Practices" in this Prospectus and in the SAI for
further information.

The Portfolio may borrow money for investment purposes. See "Risk Factors and
Certain Securities and Investment Practices -- Leverage."

The CAPITAL APPRECIATION PORTFOLIO'S investment objective is long-term capital
growth; the production of any current income is secondary to this objective. The
Portfolio invests primarily in growth-oriented common stocks of medium-sized
domestic corporations and, to a lesser extent, foreign corporations.

Bankers Trust employs a flexible investment program in pursuit of the
Portfolio's investment objective. The Portfolio is not restricted to investments
in specific market sectors. The Portfolio may invest in any market sectors and
in companies of any size and may take advantage of any investment opportunity
with attractive long-term prospects. The Adviser takes advantage of its market
access and the research available to it to select investments in promising
growth companies that are involved in new technologies, new products, foreign
markets and special developments, such as research discoveries, acquisitions,
recapitalizations, liquidations or management changes, and companies whose stock
may be undervalued by the market. These situations are only illustrative of the
types of investment the Portfolio may make. The Portfolio is free to invest in
any common stock which in the Adviser's judgment provides above average
potential for long-term growth of capital and income.

The Portfolio will generally invest a majority of its assets in equity
securities of medium-sized companies (companies with a market capitalization of
between $500 million and $2 billion), but may invest in securities of companies
having various levels of market capitalization, including smaller companies
whose securities may be more volatile and less liquid than securities issued by
larger companies with higher levels of net worth. Investments will be in
companies in various industries. Industry and company fundamentals along with
key investment themes and various quantitative screens will be used in the
investment process. Criteria for selection of individual securities include the
issuer's competitive environment and position, prospects for growth, managerial
strength, earnings momentum and quality, underlying asset value, relative market
value and overall marketability. The Portfolio will follow a disciplined selling
process to lessen market risks.

The Portfolio may also invest up to 25% of its assets in similar securities of
foreign issuers. For further information on foreign investments see "Risk
Factors and Certain Securities and Investment Practices -- Risks of Investing in
Foreign Securities."

Other Investments and Investment Techniques. The Portfolio may also utilize the
following investments and investment techniques and practices: short-term
investments, options on stocks, options on stock indices, futures contracts on
stock indices, options on futures contracts, foreign currency exchange
transactions, options on foreign currencies, Rule 144A securities, when-issued
and delayed delivery securities, securities lending, and repurchase agreements.
See "Risk Factors and Certain Securities and Investment Practices" in this
Prospectus and in the SAI for further information.

The SMALL CAP PORTFOLIO'S investment objective is long-term capital growth; the
production of any current income is secondary to this objective.

The Portfolio seeks to provide long term capital growth by investing primarily
in equity securities of smaller U.S. companies. The Portfolio's policy is to
invest in equity securities of smaller companies that Bankers Trust believes are
in an early stage or transitional point in their development and have
demonstrated or have the potential for above average capital growth. The Adviser
will select companies which have the potential to gain market share in their
industry, achieve and maintain high consistent profitability or produce
increases in earnings. The Adviser also seeks companies with strong company
management and superior fundamental strength.

The Adviser employs a flexible investment program in pursuit of the Portfolio's
investment objective. The Portfolio is free to invest in any common stock which
in the Adviser's judgement provides above average potential for long-term growth
of capital and income.

Under normal market conditions, the Portfolio will invest at least 65% of its
assets in smaller companies (with market capitalizations less than $750 million
at time of purchase) that offer strong potential for capital growth. Small
capitalization companies have the potential to show earnings growth over time
that is well above the growth rate of the overall economy. The Portfolio may
also invest in larger, more established companies that the Adviser believes may
offer the potential for strong capital growth due to their relative market
position, anticipated earnings growth, changes in management or other similar
opportunities. The Portfolio will follow a disciplined selling process to lessen
market risks.

For temporary defensive purposes, when in the opinion of the Adviser that market
conditions so warrant, the Portfolio may invest all or a portion of its Assets
in common stocks of larger, more established companies or in fixed-income
securities or short-term money market securities. To the extent the Portfolio is
engaged in temporary defensive investments, the Portfolio will not be pursuing
its investment objective.

Other Investments and Techniques. The Portfolio may also utilize the following
investments and investment techniques and practices: short-term investments,
options on stocks, options on stock indices, futures contracts on stock indices,
options on future contracts, foreign currency exchange transactions, options on
foreign currencies, Rule 144A securities, when-issued and delayed delivery
securities, securities lending and repurchase agreements. See "Risk Factors and
Certain Securities and Investment Practices" in this Prospectus and in the SAI
for further information.

The INTERNATIONAL EQUITY PORTFOLIO'S investment objective is long-term capital
appreciation from investment in foreign equity securities (or other securities
with equity characteristics); the production of any current income is incidental
to this objective. The Portfolio invests primarily in established companies
based in developed countries outside the United States, but the Portfolio also
invests in securities of issuers in emerging markets. See "Risk Factors and
Certain Securities and Investment Practices -- Risks of Investing in Foreign
Securities" and "-- Risk of Investing in Emerging Markets." Under normal
circumstances, the Portfolio will invest at least 65% of the value of its total
assets in the equity securities of issuers based in at least three countries
other than the United States. The Portfolio's investments will generally be
diversified among several geographic regions and countries.

In countries and regions with well-developed capital markets where more
information is available, Bankers Trust will seek to select individual
investments for the Portfolio. Criteria for selection of individual securities
include the issuer's competitive position, prospects for growth, managerial
strength, earnings quality, underlying asset value, relative market value and
overall marketability. The Portfolio may invest in securities of companies
having various levels of net worth, including smaller companies whose securities
may be more volatile than securities offered by larger companies with higher
levels of net worth.

In other countries and regions where capital markets are underdeveloped or not
easily accessed and information is difficult to obtain, the Portfolio may choose
to invest only at the market level. Here, to the extent available and consistent
with applicable regulations, the Portfolio may seek to achieve country exposure
through use of options or futures based on an established local index or through
investment in other registered investment companies rather than investing
directly in individual securities. Investment in other investment companies is
limited in amount by the 1940 Act, will involve the indirect payment of a
portion of the expenses, including advisory fees, of such other investment
companies and may result in a duplication of fees and expenses.

The Portfolio invests in securities listed on foreign or domestic securities
exchanges and securities traded in foreign or domestic over-the-counter markets
and may invest in restricted or unlisted securities.

Other Investments and Investment Techniques. The Portfolio may also utilize the
following investments and investment techniques and practices: short-term
investments, foreign currency exchange transactions, options on foreign
currencies, American Depositary Receipts ("ADRs"), Global Depositary Receipts
("GDRs") and European Depositary Receipts ("EDRs"), options on stocks, options
on foreign stock indices, futures contracts on foreign stock indices, options on
futures contracts, Rule 144A securities, when-issued and delayed delivery
securities, securities lending and repurchase agreements. See "Risk Factors and
Certain Securities and Investment Practices" in this Prospectus and in the SAI
for further information.

The PACIFIC BASIN EQUITY PORTFOLIO'S investment objective is long-term capital
appreciation from investment primarily in the equity securities (or other
securities with equity characteristics) of companies domiciled in, or doing
business in the Pacific Basin region, other than Japan; the production of any
current income is incidental to this objective. Investment in such securities
involves certain considerations which are not normally involved in investment in
securities of U.S. issuers, and an investment in the Fund may be considered
speculative.

For purposes of this Prospectus, "issuers domiciled in, or doing business in,
the Pacific Basin region (other than Japan)" shall include securities of
issuers: (1) which are organized under the laws of Pacific Basin countries (see
below); (2) for which the principal securities trading market is in a Pacific
Basin country; or (3) which derive a significant proportion (at least 50
percent) of their revenues or profits from goods produced or sold, investments
made, or services performed in the countries of the Pacific Basin or which have
at least 50 percent of their assets situated in the countries of the Pacific
Basin. It is expected under normal conditions that at least 65% of the
Portfolio's assets will be invested in the equity securities of issuers located
in at least three countries in the Pacific Basin.

For the purpose of this Prospectus, the "Pacific Basin" includes, but is not
limited to, the following countries: Hong Kong, India, Indonesia, Malaysia, New
Zealand, Pakistan, the Philippines, the People's Republic of China ("China"),
Singapore, Sri Lanka, South Korea, Thailand, Taiwan and Vietnam. See "Risk
Factors and Certain Securities and Investment Practices -- Risks of Investing in
Foreign Securities" in this Prospectus and "Risk Factors and Certain Securities
and Investment Practices -- Risks of Investing in China and China Region" in the
SAI.

The Portfolio will be managed using a disciplined, value-oriented investment
philosophy that stresses the inherent value of, and the medium term outlook for,
the companies under examination. Experience has proven that often the real basis
of a business is quite different from that perceived by the market: a
misconception that usually results in its shares trading below its true business
or replacement value. The exploitation of this "perception/reality" gap is a
hallmark of the investment style that has been adopted for the Portfolio, and a
potential source of value for its investors.

"Value" investing means trying to find companies which are mispriced by the
market for reasons of neglect, fashion or misconception. These opportunities
arise out of legislative changes, industrial restructuring and technology
advancements, for example. As a result, Bankers Trust and the sub-investment
adviser attach great importance to analyzing trends and accessing possible
breaks with traditional price patterns. At the company level, the emphasis is
placed on assessing the inherent "business" value of the firm. While this often
varies from the stock market's valuation, the Adviser and the sub- investment
adviser believe a company's stock price tends to gravitate to their "business"
value over time.

The Portfolio's investments will generally be diversified among several
geographic regions and countries in the Pacific Basin. Criteria for determining
the appropriate distribution of investment among various countries and regions
include the prospects for relative growth among foreign countries, expected
levels of inflation, government policies influencing business conditions, the
outlook for currency relationships and the range of alternative opportunities
available to international investors.

The Portfolio will not invest more than 20% of the value of its total assets in
issuers domiciled in China.

In countries and regions where capital markets are underdeveloped or not easily
accessed and information is difficult to obtain, the Portfolio may choose to
invest only at the market level. Here, to the extent available and consistent
with applicable regulations, the Portfolio may seek to achieve country exposure
through the use of options on futures based on an established local index or
through investment in other registered investment companies. Investment in other
investment companies is limited in amount by the 1940 Act, will involve the
indirect payment of a portion of the expenses, including advisory fees, of such
other investment companies and may result in a duplication of fees and expenses.

Other Investments and Investment Techniques. The Portfolio may also utilize the
following investments and investment techniques and practices: short-term
investments, foreign currency exchange transactions, options on foreign
currencies, ADRs, GDRs and EDRs, options on stocks, options on foreign stock
indices, futures contracts on foreign stock indices, options on futures
contracts, 144A securities, when-issued and delayed delivery securities,
securities lending and repurchase agreements. See "Risk Factors and Certain
Securities and Investment Practices" in this Prospectus and in the SAI for
further information.

The LATIN AMERICAN EQUITY PORTFOLIO'S investment objective is long-term capital
appreciation from investment primarily in the equity securities (or other
securities with equity characteristics) of companies domiciled in, or doing
business in, Latin America; the production of any current income is incidental
to this objective. Investment in such securities involves certain considerations
which are not normally involved in investment in securities of U.S. issuers, and
an investment in the Fund may be considered speculative. See "Risk Factors and
Certain Securities and Investment Practices -- Risks of Investing in Foreign
Securities" and "-- Risk of Investing in Emerging Markets" herein and "Foreign
Securities: Special Consideration Concerning Latin America" in the SAI. It is
expected under normal conditions that at least 65% of the Portfolio's total
assets will be invested in the equity securities of Latin American issuers.

The Fund may borrow money for investment purposes. See "Risk Factors and
Certain Securities and Investment Practices -- Leverage."

For purposes of this Prospectus, "Latin America" is defined as Mexico, and all
countries in Central America and South America, including Argentina, Brazil,
Chile, Colombia, Peru and Venezuela.

As used in this Prospectus, "securities of Latin American issuers" is defined
as: (i) securities of companies the principal securities trading market for
which is in Latin America; (ii) securities, traded in any market, of companies
that derive 50% or more of their total revenue from either goods or services
produced in Latin America or sales made in Latin America; (iii) securities of
companies organized under the laws of, and with a principal office in, Latin
America; or (iv) securities issued or guaranteed by the government of a country
in Latin America, its agencies or instrumentalities, political subdivisions or
the central bank of such a country. Determinations as to eligibility will be
made by Bankers Trust, under the supervision of the Board of Trustees of BT
Investment Portfolios, based on publicly available information and inquiries
made to the issuers.

Bankers Trust intends to consider investment only in those countries in Latin
America in which it believes investing is feasible and does not involve undue
political risks. As of the date of this Prospectus, this list included
Argentina, Brazil, Chile, Colombia, Mexico, Peru and Venezuela. Under normal
circumstances, the Portfolio's investments will be diversified among at least
three Latin American countries.

The Portfolio may invest in securities of companies having various levels of net
worth, including small companies whose securities may be more volatile than
securities offered by larger companies with higher levels of net worth.

In other countries and regions where capital markets are underdeveloped or not
easily accessed and information is difficult to obtain, the Portfolio may choose
to invest only at the market level. Here, to the extent available and consistent
with applicable regulations, the Portfolio may seek to achieve country exposure
through the use of options or futures based on an established local index or
through investment in other registered investment companies. Investment in other
investment companies is limited in amount by the 1940 Act, will involve the
indirect payment of a portion of the expenses, including advisory fees, of such
other investment companies and may result in a duplication of fees and expenses.

Fixed Income Investments. For purposes of seeking capital appreciation, the
Portfolio may invest up to 35% of its total assets in debt securities of Latin
American issuers which are rated at least C by S&P or Moody's or, if unrated, of
comparable quality in the opinion of Bankers Trust. As an operating policy,
which may be changed by the Board of Trustees of BT Investment Portfolios, the
Portfolio will not invest more than 10% of its total assets in debt securities
rated BBB or lower by S&P or Baa or lower by Moody's. Securities which are rated
BBB by S&P or Baa by Moody's possess speculative characteristics. Bonds rated C
by S&P are of the lowest quality and may be used when the issuer has filed a
bankruptcy petition, but debt payments are still being paid. Moody's lowest
rating is C, which is applied to bonds which have extremely poor prospects of
ever attaining any real investment standing. See "Risk Factors and Certain
Securities and Investment Practices -- Risks of Investing in High Yield
Securities (Junk Bonds)." Certain debt securities can provide the potential for
capital appreciation based on various factors such as changes in interest rates,
economic and market conditions, improvement in an issuer's ability to repay
principal and pay interest and ratings upgrades. Additionally, convertible bonds
offer the potential for capital appreciation through the conversion feature,
which enables the holder of the bond to benefit from increases in the market
price of the securities into which they are convertible.

Other Investments and Investment Techniques. The Portfolio may also utilize the
following investments and investment techniques and practices: Brady bonds,
foreign currency exchange transactions, options on foreign currencies, ADRs,
GDRs and EDRs, options on stocks, options on foreign stock indices, futures
contracts on foreign stock indices, options on futures contracts, when-issued
and delayed delivery securities, Rule 144A securities, short-term investments,
repurchase agreements, reverse repurchase agreements and securities lending. See
"Risk Factors and Certain Securities and Investment Practices" in this
Prospectus and in the SAI for further information.

RISK FACTORS AND CERTAIN SECURITIES AND INVESTMENT PRACTICES

The following pages contain more detailed information about types of instruments
in which a Portfolio may invest and strategies Bankers Trust may employ in
pursuit of a Portfolio's investment objective. A summary of risks and
restrictions associated with these instrument types and investment practices is
included as well.

Bankers Trust may not buy all of these instruments or use all of these
techniques to the full extent permitted unless it believes that doing so will
help a Portfolio achieve its goal. Holdings and recent investment strategies are
described in the financial reports of a Fund and the corresponding Portfolio,
which are sent to Fund shareholders twice a year. For a free SAI or financial
report, call an Investment Professional.

RISKS OF INVESTING IN FOREIGN SECURITIES
Investors should realize that investing in securities of foreign issuers
involves considerations not typically associated with investing in securities of
companies organized and operated in the United States. Investors should realize
that the value of a Portfolio's foreign investments may be adversely affected by
changes in political or social conditions, diplomatic relations, confiscatory
taxation, expropriation, nationalization, limitation on the removal of funds or
assets, or imposition of (or change in) exchange control or tax regulations in
foreign countries. In addition, changes in government administrations or
economic or monetary policies in the United States or abroad could result in
appreciation or depreciation of portfolio securities and could favorably or
unfavorably affect the Portfolio's operations. Furthermore, the economies of
individual foreign nations may differ from the U.S. economy, whether favorably
or unfavorably, in areas such as growth of gross national product, rate of
inflation, capital reinvestment, resource self-sufficiency and balance of
payments position; it may also be more difficult to obtain and enforce a
judgment against a foreign issuer. In general, less information is publicly
available with respect to foreign issuers than is available with respect to U.S.
companies. Most foreign companies are also not subject to the uniform accounting
and financial reporting requirements applicable to issuers in the United States.
Any foreign investments made by the Portfolio must be made in compliance with
U.S. and foreign currency restrictions and tax laws restricting the amounts and
types of foreign investments.

Because foreign securities generally are denominated and pay dividends or
interest in foreign currencies, the value of the net assets of a Portfolio as
measured in U.S. dollars will be affected favorably or unfavorably by changes in
exchange rates. In order to protect against uncertainty in the level of future
foreign currency exchange rates, each Portfolio is also authorized to enter into
certain foreign currency exchange transactions. Furthermore, a Portfolio's
foreign investments may be less liquid and their prices may be more volatile
than comparable investments in securities of U.S. companies. The settlement
periods for foreign securities, which are often longer than those for securities
of U.S. issuers, may affect portfolio liquidity. Finally, there may be less
government supervision and regulation of securities exchanges, brokers and
issuers in foreign countries than in the United States.

RISK OF INVESTING IN EMERGING MARKETS
The world's industrialized markets generally include but are not limited to the
following: Australia, Austria, Belgium, Canada, Denmark, Finland, France,
Germany, Hong Kong, Ireland, Italy, Japan, Luxembourg, the Netherlands, New
Zealand, Norway, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and
the United States; the world's emerging markets generally include but are not
limited to the following: Argentina, Bolivia, Brazil, Bulgaria, Chile, China,
Colombia, Costa Rica, the Czech Republic, Ecuador, Egypt, Greece, Hungary,
India, Indonesia, Israel, the Ivory Coast, Jordan, Malaysia, Mexico, Morocco,
Nicaragua, Nigeria, Pakistan, Peru, the Philippines, Poland, Portugal, Romania,
Russia, Slovakia, Slovenia, South Africa, South Korea, Sri Lanka, Taiwan,
Thailand, Turkey, Uruguay, Venezuela, Vietnam and Zimbabwe.

Investment in securities of issuers based in underdeveloped countries entails
all of the risks of investing in securities of foreign issuers outlined in this
section to a heightened degree. These heightened risks include: (i) greater
risks of expropriation, confiscatory taxation, nationalization, and less social,
political and economic stability; (ii) the smaller size of the market for such
securities and a low or nonexistent volume of trading, resulting in lack of
liquidity and in price volatility; (iii) certain national policies which may
restrict the Portfolio's investment opportunities including restrictions on
investing in issuers or industries deemed sensitive to relevant national
interests; and (iv) in the case of Eastern Europe and in China and other Asian
countries, the absence of developed capital markets and legal structures
governing private or foreign investment and private property and the possibility
that recent favorable economic and political developments could be slowed or
reversed by unanticipated events.

So long as the Communist Party continues to exercise a significant or, in some
countries, dominant role in Eastern European countries or in China and other
Asian countries, investments in such countries will involve risks of
nationalization, expropriation and confiscatory taxation. The Communist
governments of a number of Eastern European countries expropriated large amounts
of private property in the past, in many cases without adequate compensation,
and there may be no assurance that such expropriation will not occur in the
future. In the event of such expropriation, a Portfolio could lose a substantial
portion of any investments it has made in the affected countries. Further, no
accounting standards exist in Eastern European countries. Finally, even though
certain Eastern European currencies may be convertible into U.S. dollars, the
conversion rates may be artificial to the actual market values and may be
adverse to Fund shareholders.

In addition to brokerage commissions, custodial services and other costs
relating to investment in emerging markets are generally more expensive than in
the United States. Such markets have been unable to keep pace with the volume of
securities transactions, making it difficult to conduct such transactions. The
inability of the Portfolio to make intended security purchases due to settlement
problems could cause the Portfolio to miss attractive investment opportunities.
Inability to dispose of a security due to settlement problems could result
either in losses to the Portfolio due to subsequent declines in the value of the
security or, if the Portfolio has entered into a contract to sell the security,
could result in possible liability to the purchaser.

RISKS OF INVESTING IN HIGH YIELD SECURITIES (JUNK BONDS)
Lower-rated securities, including securities rated from BB to D by S&P or Ba to
C by Moody's or, if unrated, of comparable quality in the opinion of Bankers
Trust, will usually offer higher yields than higher-rated securities. However,
there is more risk associated with these investments. This is because of the
reduced creditworthiness and increased risk of default that these securities
carry. Lower-rated securities generally tend to reflect short-term corporate and
market developments to a greater extent than higher-rated securities which react
primarily to fluctuations in the general level of interest rates. Lower rated
securities also involve greater sensitivity to significant increases in interest
rates. Short-term corporate and market developments affecting the prices and
liquidity of lower-rated securities could include adverse news impacting major
issues or underwriters or dealers in lower-rated or unrated securities. In
addition, since there are fewer investors in lower-rated securities, it may be
harder to sell securities at an optimum time.

An economic downturn may adversely affect the value of some lower-rated bonds.
Such a downturn may especially affect highly leveraged companies or companies in
cyclically sensitive industries, where deterioration in a company's cash flow
may impair its ability to meet its obligation to pay principal and interest to
bondholders in a timely fashion. From time to time, as a result of changing
conditions, issuers of lower-rated bonds may seek or may be required to
restructure the terms and conditions of the securities they have issued. As a
result of these restructurings, holders of lower-rated securities may receive
less principal and interest than originally expected at the time such bonds were
purchased. In the event of a restructuring, the Portfolio may bear additional
legal or administrative expenses in order to maximize recovery from an issuer.
The secondary trading market for lower-rated bonds is generally less liquid than
the secondary trading market for higher-rated bonds.

The risk of loss due to default by the issuer is significantly greater for the
holders of high yield securities because such securities are generally unsecured
and are often subordinated to other obligations of the issuer. During an
economic downturn or a sustained period of rising interest rates, highly
leveraged issuers of high yield securities may experience financial stress and
may not have sufficient revenues to meet their interest payment obligations. An
issuer's ability to service its debt obligations may also be adversely affected
by specific corporate developments, its inability to meet specific projected
business forecasts, or the unavailability of additional financing.

Factors adversely affecting the market value of high yield and other Portfolio
securities will adversely affect the corresponding Fund's net asset value. In
addition, a Portfolio may incur additional expenses to the extent it is required
to seek recovery upon a default in the payment of principal or interest on its
portfolio holdings.

RISKS OF INVESTING IN MEDIUM- AND SMALL-CAPITALIZATION STOCKS
The Small Cap Portfolio and Capital Appreciation Portfolio invest primarily in
smaller-sized and medium-sized, respectively, growth-oriented common stocks of
domestic corporations and, to a limited extent, foreign corporations.
Historically, medium- and small-capitalization stocks have been more volatile in
price that the larger-capitalization stocks included in the S&P 500. Among the
reasons for the greater price volatility of these securities are the less
certain growth prospects of smaller firms, the lower degree of liquidity in the
markets for such stocks, and the greater sensitivity of medium- and small- size
companies to changing economic conditions. In addition to exhibiting greater
volatility, medium- and small-size company stocks may fluctuate independently of
larger company stocks. Medium- and small-size company stocks may decline in
price as large company stocks rise, or rise in prices as large company stocks
decline.

NON-DIVERSIFIED FUND
The Global High Yield Securities Portfolio and Fund are each classified as a
"non-diversified" investment company so that with respect to 50% of the
Portfolio's assets, it will be able to invest more than 5% of its assets in
obligations of one or more issuers, while being limited with respect to the
other half of its assets to investments not exceeding 5% of the Portfolio's
total assets. (A "diversified" investment company would be required under the
1940 Act, to maintain at least 75% of its assets in cash (including foreign
currency), cash items, U.S. Government securities, and other securities limited
per issuer to not more than 5% of the investment company's total assets.) In
order to enable the Fund to qualify as a regulated investment company under the
Internal Revenue Code of 1986, as amended (the "Code"), the Portfolio, among
other things, may not invest more than 25% of its assets in obligations of any
one issuer (other than U.S. Government securities). As a "non-diversified"
investment company, the Portfolio may invest a greater proportion of its assets
in the securities of a smaller number of issuers and therefore may be subject to
greater market and credit risk than a more broadly diversified fund.

The Portfolio will not have more than 25% of the current value of its total
assets invested in any single industry, provided that this restriction shall not
apply to debt securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities.

SPECIAL INFORMATION CONCERNING MASTER-FEEDER FUND STRUCTURE
Unlike other open-end management investment companies (mutual funds) which
directly acquire and manage their own portfolio securities, each Fund seeks to
achieve its investment objective by investing all of its Assets in the
corresponding Portfolio, a separate registered investment company with the same
investment objectives as the Fund. Therefore, an investor's interest in the
Portfolio's securities is indirect. In addition to selling a beneficial interest
to the corresponding Fund, each Portfolio may sell beneficial interests to other
mutual funds or institutional investors. Such investors will invest in a
Portfolio on the same terms and conditions and will pay a proportionate share of
the Portfolio's expenses. However, the other investors investing in a Portfolio
are not required to sell their shares at the same public offering price as the
Fund due to variations in sales commissions and other operating expenses.
Therefore, investors in a Fund should be aware that these differences may result
in differences in returns experienced by investors in the different funds that
invest in the Portfolio. Such differences in returns are also present in other
mutual fund structures. Information concerning other holders of interests in the
Portfolio is available from Bankers Trust, as the Administrator, at (800)
730-1313.

The master-feeder structure has been developed relatively recently, so
shareholders should carefully consider this investment approach.

Smaller funds investing in a Portfolio may be materially affected by the actions
of larger funds investing in the Portfolio. For example, if a large fund
withdraws from a Portfolio, the remaining funds may experience higher pro rata
operating expenses, thereby producing lower returns (however, this possibility
exists as well for traditionally structured funds which have large institutional
investors). Additionally, a Portfolio may become less diverse, resulting in
increased portfolio risk. Also, funds with a greater pro rata ownership in a
Portfolio could have effective voting control of the operations of the
Portfolio. Except as permitted by the SEC, whenever the Trust is requested to
vote on matters pertaining to a Portfolio, the Trust will hold a meeting of
shareholders of the Fund and will cast all of its votes in the same proportion
as the votes of the Fund's shareholders. Fund shareholders who do not vote will
not affect the Trust's votes at the Portfolio meeting. The percentage of the
Trust's votes representing Fund shareholders not voting will be voted by the
Trustees or officers of the Trust in the same proportion as the Fund
shareholders who do, in fact, vote. Certain changes in the Portfolio's
investment objectives, policies or restrictions may require the Fund to withdraw
its interest in the Portfolio. Any such withdrawal could result in a
distribution "in kind" of portfolio securities (as opposed to a cash
distribution from the Portfolio). If securities are distributed, the Fund could
incur brokerage, tax or other charges in converting the securities to cash. In
addition, the distribution in kind may result in a less diversified portfolio of
investments or adversely affect the liquidity of the Fund. Notwithstanding the
above, there are other means for meeting redemption requests, such as borrowing.

A Fund may withdraw its investment from the Portfolio at any time, if the Board
of Trustees of the Trust determines that it is in the best interests of the
shareholders of the Fund to do so. Upon any such withdrawal, the Board of
Trustees of the Trust would consider what action might be taken, including the
investment of all the Assets of the Fund in another pooled investment entity
having the same investment objectives as the Fund or the retaining of an
investment adviser to manage the Fund's Assets in accordance with the investment
policies described herein with respect to the corresponding Portfolio.

Each Fund's investment objective is not a fundamental policy and may be changed
upon notice to but without the approval of the Fund's shareholders. If there is
a change in a Fund's investment objective, the Fund's shareholders should
consider whether the Fund remains an appropriate investment in light of their
then-current needs. The investment objective of each Portfolio is also not a
fundamental policy. Shareholders of the Funds will receive 30 days prior written
notice with respect to any change in the investment objective of a Fund or the
corresponding Portfolio. See "Risk Factors and Certain Securities and Investment
Practices" in the SAI for a description of the fundamental policies of each
Portfolio that cannot be changed without approval by "the vote of a majority of
the outstanding voting securities" (as defined in the 1940 Act) of the
Portfolio.

For descriptions of the investment objective, policies and restrictions of each
Portfolio, see "The Funds in Detail" herein and "Risk Factors and Certain
Securities and Investment Practices" in this Prospectus and in the SAI. For
descriptions of the management of the Trust and the Portfolios, see "Management
of the Trust and the Portfolios" herein and in the SAI. For descriptions of the
expenses of the Portfolio, see "The Funds -- Expense Summary" herein and
"Management of the Trust and the Portfolios" herein and in the SAI.

SECURITIES AND INVESTMENT PRACTICES
EQUITY SECURITIES. As used herein, "equity securities" are defined as common
stock, preferred stock, trust or limited partnership interests, rights and
warrants to subscribe to or purchase such securities, sponsored or unsponsored
ADRs, EDRs and GDRs, and convertible securities, consisting of debt securities
or preferred stock that may be converted into common stock or that carry the
right to purchase common stock. Common stocks, the most familiar type, represent
an equity (ownership) interest in a corporation. Although equity securities have
a history of long-term growth in value, their prices fluctuate based on changes
in a company's financial condition and on overall market and economic
conditions. Smaller companies are especially sensitive to these factors.

DEBT SECURITIES. Bonds and other debt instruments are used by issuers to borrow
money from investors. The issuer pays the investor a fixed or variable rate of
interest, and must repay the amount borrowed at maturity. Some debt securities,
such as zero coupon bonds, do not pay current interest, but are purchased at a
discount from their face values. Debt securities, loans, and other direct debt
have varying degrees of quality and varying levels of sensitivity to changes in
interest rates. Longer-term bonds are generally more sensitive to interest rate
changes than short-term bonds.

Lower-quality foreign government securities are often considered to be
speculative and involve greater risk of default or price changes, or they may
already be in default. These risks are in addition to the general risks
associated with foreign securities.

CONVERTIBLE SECURITIES. A convertible security is a bond or preferred stock
which may be converted at a stated price within a specific period of time into a
specified number of shares of common stock of the same or different issuer.
Convertible securities are senior to common stock in a corporation's capital
structure, but usually are subordinated to non-convertible debt securities.
While providing a fixed income stream -- generally higher in yield than in the
income derived from a common stock but lower than that afforded by a
non-convertible debt security -- a convertible security also affords an investor
the opportunity, through its conversion feature, to participate in the capital
appreciation of common stock into which it is convertible.

In general, the market value of a convertible security is the higher of its
investment value (its value as a fixed income security) or its conversion value
(the value of the underlying shares of common stock if the security is
converted). As a fixed income security, the market value of a convertible
security generally increases when interest rates decline and generally decreases
when interest rates rise; however, the price of a convertible security generally
increases as the market value of the underlying stock increases, and generally
decreases as the market value of the underlying stock declines. Investments in
convertible securities generally entail less risk than investments in the common
stock of the same issuer.

PREFERRED STOCK. Preferred stock has a preference in liquidation (and, generally
dividends) over common stock but is subordinated in liquidation to debt. As a
general rule the market value of preferred stocks with fixed dividend rates and
no conversion rights varies inversely with interest rates and perceived credit
risk, with the price determined by the dividend rate. Some preferred stocks are
convertible into other securities, for example common stock, at a fixed price
and ratio or upon the occurrence of certain events. The market price of
convertible preferred stocks generally reflects an element of conversion value.
Because many preferred stocks lack a fixed maturity date, these securities
generally fluctuate substantially in value when interest rates change; such
fluctuations often exceed those of long-term bonds of the same issuer. Some
preferred stocks pay an adjustable dividend that may be based on an index,
formula, auction procedure or other dividend rate reset mechanism. In the
absence of credit deterioration, adjustable rate preferred stocks tend to have
more stable market values than fixed rate preferred stocks.

All preferred stocks are also subject to the same types of credit risks of the
issuer as corporate bonds. In addition, because preferred stock is junior to
debt securities and other obligations of an issuer, deterioration in the credit
rating of the issuer will cause greater changes in the value of a preferred
stock than in a more senior debt security with similar yield characteristics.
Preferred stocks may be rated by S&P and Moody's although there is no minimum
rating which a preferred stock must have (and a preferred stock may not be
rated) to be an eligible investment for a Portfolio. Bankers Trust expects,
however, that generally the preferred stocks in which a Portfolio invests will
be rated at least CCC by S&P or Caa by Moody's or, if unrated, of comparable
quality in the opinion of Bankers Trust. Preferred stocks rated CCC by S&P are
regarded as predominantly speculative with respect to the issuer's capacity to
pay preferred stock obligations and represent the highest degree of speculation
among securities rated between BB and CCC; preferred stocks rated Caa by Moody's
are likely to be in arrears on dividend payments. Moody's rating with respect to
preferred stocks does not purport to indicate the future status of payments of
dividends.

WARRANTS are instruments which entitle the holder to buy underlying equity
securities at a specific price for a specific period of time. A warrant tends to
be more volatile than its underlying securities and ceases to have value if it
is not exercised prior to its expiration date. In addition, changes in the value
of a warrant do not necessarily correspond to changes in the value of its
underlying securities.

U.S. GOVERNMENT SECURITIES are high-quality debt securities issued or guaranteed
by the U.S. Treasury or by an agency or instrumentality of the U.S. government.
Not all U.S. government securities are backed by the full faith and credit of
the United States. For example, securities issued by the Federal Farm Credit
Bank or by the Federal National Mortgage Association are supported by the
instrumentality's right to borrow money from the U.S. Treasury under certain
circumstances. However, securities issued by other agencies or instrumentalities
are supported only by the credit of the entity that issued them.

ADRS, GDRS AND EDRS are certificates evidencing ownership of shares of a
foreign-based issuer held in trust by a bank or similar financial institution.
Designed for use in U.S. and European securities markets, respectively, ADRs,
GDRs and EDRs are alternatives to the purchase of the underlying securities in
their national markets and currencies. ADRs, GDRs and EDRs are subject to the
same risks as the foreign securities to which they relate. See "Risk Factors and
Certain Securities and Investment Practices -- Risks of Investing in Foreign
Securities."

ZERO COUPON SECURITIES are the separate income or principal components of a debt
instrument. These involve risks that are similar to those of other debt
securities, although they may be more volatile, and certain zero coupon
securities move in the same direction as interest rates.

FLOATING RATE BONDS may have interest rates that move in tandem with a
benchmark, helping to stabilize their prices.

SOVEREIGN AND SUPRANATIONAL DEBT OBLIGATIONS. Debt instruments issued or
guaranteed by foreign governments, agencies, and supranational organizations
("sovereign debt obligations"), especially sovereign debt obligations of
developing countries, may involve a high degree of risk, and may be in default
or present the risk of default. The issuer of the obligation or the governmental
authorities that control the repayment of the debt may be unable or unwilling to
repay principal and interest when due, and may require renegotiation or
rescheduling of debt payments. In addition, prospects for repayment of principal
and interest may depend on political as well as economic factors.

BRADY BONDS. "Brady bonds" are bonds issued as a result of a restructuring of a
country's debt obligations to commercial banks under the "Brady plan." Brady
bonds have been issued by the governments of Argentina, Costa Rica, Mexico,
Nigeria, Uruguay and Venezuela, Brazil and the Philippines, as well as other
emerging market countries. Most Brady bonds are currently rated below BBB by S&P
or Baa by Moody's. While Bankers Trust is not aware of the occurrence of any
payment defaults on Brady bonds, investors should recognize that these debt
securities have been issued only recently and, accordingly, do not have a long
payment history. Brady bonds may be collateralized or uncollateralized, are
issued in various currencies (primarily the U.S. dollar) and are actively traded
in the secondary market for Latin American debt.

RULE 144A SECURITIES are securities in the United States that are not registered
for sale under Federal securities laws but which can be resold to institutions
under the SEC's Rule 144A. Provided that a dealer or institutional trading
market in such securities exists, these restricted securities are treated as
exempt from the 15% limit on illiquid securities. Under the supervision of the
Board of Trustees of the Portfolio, Bankers Trust determines the liquidity of
restricted securities and, through reports from Bankers Trust, the Board will
monitor trading activity in restricted securities. Because Rule 144A is
relatively new, it is not possible to predict how these markets will develop. If
institutional trading in restricted securities were to decline, the liquidity of
the Portfolio could be adversely affected. No more than 10% of the Portfolio's
assets may be invested in securities restricted as to transfer or re-sale,
including Rule 144A securities.

WHEN ISSUED AND DELAYED DELIVERY SECURITIES. Each Portfolio may purchase
securities on a when-issued or delayed delivery basis. Delivery of and payment
for these securities may take place as long as a month or more after the date of
the purchase commitment. The value of these securities is subject to market
fluctuation during this period and no income accrues to the Portfolio until
settlement takes place. The Portfolio maintains with the Custodian a segregated
account containing high grade liquid securities in an amount at least equal to
these commitments.

REPURCHASE AGREEMENTS. In a repurchase agreement, a Portfolio buys a security at
one price and simultaneously agrees to sell it back at a higher price. Delays or
losses could result if the other party to the agreement defaults or becomes
insolvent.

REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a Portfolio
temporarily transfers possession of a portfolio instrument to another party in
return for cash. This could increase the risk of fluctuation in the fund's yield
or in the market value of its assets. A reverse repurchase agreement is a form
of borrowing and will be counted towards each Portfolio's borrowing
restrictions. See "Risk Factors and Certain Securities and Investment Practices
- -- Leverage" and in the SAI.

INVESTMENT COMPANIES. With respect to certain countries in which capital markets
are either less developed or not easily accessed, investments by the Portfolio
may be made through investment in other registered investment companies that in
turn are authorized to invest in the securities of such countries. Investment in
other investment companies is limited in amount by the 1940 Act, will involve
the indirect payment of a portion of the expenses, including advisory fees, of
such other investment companies and may result in a duplication of fees and
expenses.

SHORT-TERM INVESTMENTS. Each Portfolio intends to stay invested in the
securities described above to the extent practical in light of its objective and
long-term investment perspective. However, a Portfolio's assets may be invested
in high quality short-term investments with remaining maturities of 397 days or
less to meet anticipated redemptions and expenses for day-to-day operating
purposes and when, in Bankers Trust's opinion, it is advisable to adopt a
temporary defensive position because of unusual and adverse conditions affecting
the respective markets.

SECURITIES LENDING. Each Portfolio is permitted to lend up to 30% of the total
value of its securities. These loans must be secured continuously by cash or
equivalent collateral or by a letter of credit at least equal to the market
value of the securities loaned plus accrued income. By lending its securities,
the Portfolio can increase its income by continuing to receive income on the
loaned securities as well as by the opportunity to receive interest on the
collateral. Any gain or loss in the market price of the borrowed securities
which occurs during the term of the loan inures to the Portfolio and its
investors. In lending securities to brokers, dealers and other financial
organizations, a Portfolio is subject to risks, which like those associated with
other extensions of credit, include delays in recovery and possible loss of
rights in the collateral should the borrower fail financially.

LEVERAGE. The Global High Yield Securities Portfolio and Latin American Equity
Portfolio may each borrow up to one-third of the value of its total assets, from
banks or through the use of reverse repurchase agreements, to increase its
holdings of portfolio securities. Under the 1940 Act, each Portfolio is required
to maintain continuous asset coverage of 300% with respect to such borrowings
and to sell (within three days) sufficient portfolio holdings to restore such
coverage if it should decline to less than 300% due to market fluctuations or
otherwise, even if such liquidations of a Portfolio's holdings may be
disadvantageous from an investment standpoint.

Leveraging by means of borrowing may exaggerate the effect of any increase or
decrease in the value of each Portfolio's securities and the corresponding
Fund's net asset value and money borrowed by a Portfolio will be subject to
interest and other costs (which may include commitment fees and/or the cost of
maintaining minimum average balances) which may or may not exceed the income
received from the securities purchased with borrowed funds.

LOAN PARTICIPATIONS AND ASSIGNMENTS. The Global High Yield Securities Portfolio
may invest in fixed and floating rate loans ("loans") arranged through private
negotiations between a borrower and one or more institutions ("lenders"). The
majority of the Portfolio's investments in loans in emerging markets is expected
to be in the form of participations in loans ("participations") and assignments
of portions of loans from third parties ("assignments"). The Portfolio may also
invest in loans, participations or assignments of loans to borrowers located in
the industrialized world. Participations typically will result in the
Portfolio's having a contractual relationship only with the lender, not the
borrower. The Portfolio will have the right to receive payments of principal,
interest and any fees to which it is entitled only from the lender selling the
participation and only upon receipt by the lender of the payments from the
borrower. In connection with purchasing participations, the Portfolio generally
will have no right to enforce compliance by the borrower with the terms of the
loan agreement relating to the loan ("loan agreement"), nor any rights of
set-off against the borrower, and the Portfolio may not directly benefit from
any collateral supporting the loan in which it has purchased the participation.
As a result, the Portfolio will assume the credit risk of both the borrower and
the lender that is selling the participation. In the event of the insolvency of
the lender selling the participation, the Portfolio may be treated as a general
creditor of the lender and may not benefit from any set-off between the lender
and the borrower. The Portfolio will acquire participations only if the lender
interpositioned between the Portfolio and the borrower is determined by Bankers
Trust to be creditworthy. When the Portfolio purchases assignments from lenders,
the Portfolio will acquire direct rights against the borrower on the loan;
however, since assignments are arranged through private negotiations between the
potential assignees and assignors, the rights and obligations acquired by the
Portfolio as the purchaser of an assignment may differ from, and be more limited
than, those held by the assigning lender.

The Portfolio may have difficulty disposing of assignments and participations.
The liquidity of such securities is limited and the Portfolio anticipates that
such securities could only be sold to a limited number of institutional
investors. The lack of a liquid secondary market could have an adverse impact on
the value of such securities and on the Portfolio's ability to dispose of
particular assignments or participations when necessary to meet the Portfolio's
liquidity needs or in response to a specific economic event, such as a
deterioration in the creditworthiness of the borrower. The lack of a liquid
secondary market for assignments and participations also may make it more
difficult in valuing the Portfolio and, therefore, calculating the net asset
value per share of the Fund. All assignments and participations shall be
considered to be illiquid securities by the Portfolio. The investment by the
Portfolio in illiquid securities, including assignments and participations, is
limited to a total of 15% of net assets.

DERIVATIVES
Each Portfolio may invest in various instruments that are commonly known as
derivatives. Generally, a derivative is a financial arrangement, the value of
which is based on, or "derived" from, a traditional security, asset, or market
index. Some "derivatives" such as mortgage-related and other asset-backed
securities are in many respects like any other investment, although they may be
more volatile or less liquid than more traditional debt securities. There are,
in fact, many different types of derivatives and many different ways to use
them. There are a range of risks associated with those uses. Futures and options
are commonly used for traditional hedging purposes to attempt to protect a fund
from exposure to changing interest rates, securities prices, or currency
exchange rates and as a low cost method of gaining exposure to a particular
securities market without investing directly in those securities. However, some
derivatives are used for leverage, which tends to magnify the effects of an
instrument's price changes as market conditions change. Leverage involves the
use of a small amount of money to control a large amount of financial assets,
and can in some circumstances, lead to significant losses. Bankers Trust will
use derivatives only in circumstances where they offer the most efficient means
of improving the risk/reward profile of a Portfolio. The use of derivatives for
non-hedging purposes may be considered speculative.

Foreign Currency Exchange Transactions. Each Portfolio may enter into foreign
currency exchange transactions to convert to and from different foreign
currencies and to convert foreign currencies to and from the U.S. dollar. A
Portfolio either enters into these transactions on a spot (i.e., cash) basis at
the spot rate prevailing in the foreign currency exchange market or uses forward
contracts to purchase or sell foreign currencies.

A forward foreign currency exchange contract is an obligation by a Portfolio to
purchase or to sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract. Forward foreign currency exchange
contracts establish an exchange rate at a future date. These contracts are
transferable in the interbank market conducted directly between currency traders
(usually large commercial banks) and their customers. A forward foreign currency
exchange contract generally has no deposit requirement and is traded at a net
price without commission. Neither spot transactions nor forward foreign currency
exchange contracts eliminate fluctuations in the prices of a Portfolio's
securities or in foreign exchange rates, or prevent loss if the prices of these
securities should decline.

A Portfolio may enter into foreign currency hedging transactions in an attempt
to protect against changes in foreign currency exchange rates between the trade
and settlement dates of specific securities transactions or changes in foreign
currency exchange rates that would adversely affect a portfolio position or an
anticipated investment position. Although these transactions tend to minimize
the risk of loss due to a decline in the value of the hedged currency, at the
same time they tend to limit any potential gain that might be realized should
the value of the hedged currency increase. The precise matching of the forward
contract amounts and the value of the securities involved will not generally be
possible because the future value of such securities in foreign currencies will
change as a consequence of market movements in the value of such securities
between the date the forward contract is entered into and the date it matures.
The projection of currency market movements is extremely difficult, and the
successful execution of a hedging strategy is highly uncertain.

Options on Foreign Currencies. Each Portfolio may write covered put and call
options and purchase put and call options on foreign currencies for the purpose
of protecting against declines in the U.S. dollar value of portfolio securities
and against increases in the U.S. dollar cost of securities to be acquired. Each
Portfolio may use options on currency to cross-hedge, which involves writing or
purchasing options on one currency to hedge against changes in exchange rates
for a different, but related currency. As with other types of options, however,
the writing of an option on foreign currency will constitute only a partial
hedge up to the amount of the premium received, and the Portfolio could be
required to purchase or sell foreign currencies at disadvantageous exchange
rates, thereby incurring losses. The purchase of an option on foreign currency
may be used to hedge against fluctuations in exchange rates although, in the
event of exchange rate movements adverse to a Portfolio's position, it may
forfeit the entire amount of the premium plus related transaction costs. In
addition, a Portfolio may purchase call options on a currency when the
investment adviser anticipates that the currency will appreciate in value.

There is no assurance that a liquid secondary market on an options exchange will
exist for any particular option, or at any particular time. If a Portfolio is
unable to effect a closing purchase transaction with respect to covered options
it has written, the Portfolio will not be able to sell the underlying currency
or dispose of assets held in a segregated account until it closes out the
options or the options expire or are exercised. Similarly, if the Portfolio is
unable to close out options it has purchased, it would have to exercise the
options in order to realize any profit and will incur transaction costs. The
Portfolio pays brokerage commissions or spreads in connection with its options
transactions.

Options on Stocks. Each Portfolio (except the Global High Yield Securities
Portfolio) may write and purchase options on stocks. A call option gives the
purchaser of the option the right to buy, and obligates the writer to sell, the
underlying stock at the exercise price at any time during the option period.
Similarly, a put option gives the purchaser of the option the right to sell, and
obligates the writer to buy the underlying stock at the exercise price at any
time during the option period. A covered call option with respect to which a
Portfolio owns the underlying stock sold by the Portfolio exposes the Portfolio
during the term of the option to possible loss of opportunity to realize
appreciation in the market price of the underlying stock or to possible
continued holding of a stock which might otherwise have been sold to protect
against depreciation in the market price of the stock. A covered put option sold
by a Portfolio exposes the Portfolio during the term of the option to a decline
in price of the underlying stock.

Options on Securities Indices. Each Portfolio may purchase and write put and
call options on stock or bond indices listed on domestic and foreign stock
exchanges, in lieu of direct investment in the underlying securities or for
hedging purposes. A stock or bond index fluctuates with changes in the market
values of the securities included in the index.

Options on securities indices are generally similar to options on stocks except
that the delivery requirements are different. Instead of giving the right to
take or make delivery of securities at a specified price, an option on a stock
or bond index gives the holders the right to receive a cash "exercise settlement
amount" equal to (a) the amount, if any, by which the fixed exercise price of
the option exceeds (in the case of a put) or is less than (in the case of a
call) the closing value of the underlying index on the date of the exercise,
multiplied by (b) a fixed "index multiplier."

Successful use by a Portfolio of options on security indices will be subject to
Bankers Trust's ability to predict correctly movement in the direction of the
security market generally or of a particular industry. This requires different
skills and techniques than predicting changes in the price of individual
securities.

Futures Contracts on Securities Indices. A Portfolio may enter into contracts
providing for the making and acceptance of a cash settlement based upon changes
in the value of an index of domestic or foreign securities ("Futures
Contracts"). This investment technique may be used as a low-cost method of
gaining exposure to a particular securities market without investing directly in
those securities or to hedge against anticipated future changes in general
market prices which otherwise might either adversely affect the value of
securities held by the Portfolio or adversely affect the prices of securities
which are intended to be purchased at a later date for the Portfolio. A Futures
Contract may also be entered into to close out or offset an existing futures
position.

When used for hedging purposes, each transaction in Futures Contracts involves
the establishment of a position which will move in a direction opposite to that
of the investment being hedged. If these hedging transactions are successful,
the futures position taken for the Portfolio will rise in value by an amount
which approximately offsets the decline in value of the portion of the
Portfolio's investments that is being hedged. Should general market prices move
in an unexpected manner, the full anticipated benefits of Futures Contracts may
not be achieved or a loss may be realized.

The risks of Futures Contracts also include a potential lack of liquidity in the
secondary market and incorrect assessments of market.

Brokerage costs will be incurred and "margin" will be required to be posted and
maintained as a good faith deposit against performance of obligations under
Futures Contracts written for a Portfolio. A Portfolio may not purchase or sell
a Futures Contract if immediately thereafter its margin deposits on its
outstanding Futures Contracts, other than Futures Contracts used for hedging
purposes, would exceed 5% of the market value of the Portfolio's total assets.

Options on Futures Contracts. Each Portfolio may invest in options on futures
contracts for similar purposes.

There can be no assurance that the use of these portfolio strategies will be
successful.

Asset Coverage. To assure that a Portfolio's use of futures and related options,
as well as when-issued and delayed-delivery securities and foreign currency
exchange transactions, are not used to achieve investment leverage, a Portfolio
will cover such transactions, as required under applicable interpretations, of
the SEC, either by owning the underlying securities, entering into an
off-setting transaction, or by establishing a segregated account with the
Portfolio's custodian containing high grade liquid debt securities in an amount
at all times equal to or exceeding the Portfolio's commitment with respect to
these instruments or contracts.

PORTFOLIO TURNOVER
The portfolio turnover rate for each Portfolio for the periods indicated were as
follows: Global High Yield Securities Portfolio -- 169% and 347% for the fiscal
year ended September 30, 1995 and for the period from December 14, 1993
(commencement of operations) to September 30, 1994, respectively; Capital
Appreciation Portfolio -- 125%, 157% and 137% for the period from January 1,
1995 to September 30, 1995, the fiscal year ended December 31, 1994 and the
period from March 9, 1993 (commencement of operations) to December 31, 1993,
respectively; Small Cap Portfolio -- 161% and 154% for the fiscal year ended
September 30, 1995 and for the period from October 21, 1993 (commencement of
operations) to September 30, 1994, respectively; International Equity Portfolio
- -- 21%, 15%, 17% and 7% for the period from January 1, 1995 to September 30,
1995, the fiscal years ended December 31, 1994, 1993 and the period from August
4, 1992 (commencement of operations) to December 31, 1992, respectively; Pacific
Basin Equity Portfolio -- 104% and 40% for the fiscal year ended September 30,
1995 and for the period from November 1, 1993 (commencement of operations) to
September 30, 1994, respectively; and Latin American Equity Portfolio -- 161%
and 124% for the fiscal year ended September 30, 1995 and for the period from
October 25, 1993 (commencement of operations) to September 30, 1994,
respectively. These rates will vary from year to year. High turnover rates
increase transaction costs and may increase investable capital gains. Bankers
Trust considers these effects when evaluating the anticipated benefits of
short-term investing.

PERFORMANCE
Each Portfolio's recent strategies and holdings, and the corresponding Fund's
performance, is detailed twice a year in the Funds' financial reports, which are
sent to all Fund shareholders.

For current Fund performance or a free copy of the Funds' financial report,
please contact an Investment Professional.

Mutual fund performance is commonly measured as total return and/or yield. Each
Fund's performance is affected by the expenses of that Fund. The exclusion of
any applicable sales charge from a performance calculation produces a higher
return.

EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment in a Fund over a given
period, assuming reinvestment of any dividends and capital gains. A cumulative
total return reflects actual performance over a stated period of time. An
average annual total return is a hypothetical rate of return that, if achieved
annually, would have produced the same cumulative total return if performance
had been constant over the entire period. Average annual total return
calculations smooth out variations in performance; they are not the same as
actual year-by-year results. Average annual total returns covering periods of
less than one year assume that performance will remain constant for the rest of
the year.

Average annual and cumulative total returns may or may not include the effect of
paying the maximum applicable sales charge.

Each Fund, which has not commenced investment operations, invests all of its
Assets in the corresponding Portfolio, which is each a separate registered
investment company which commenced operations as indicated below. Consistent
with applicable regulatory guidance, performance for the period from
commencement of operations of each corresponding Portfolio to the commencement
of operations of each Fund will reflect the investment performance of the
corresponding Portfolio. The performance for this prior period reflects the
adjustment for the charges and expenses of each Fund and reflects the
deduction of the maximum front-end sales charge as set forth above under
"Expense Summary".

<TABLE>
- ---------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
TOTAL RETURNS (AS OF SEPTEMBER 30, 1995)
AVERAGE CUMULATIVE
ANNUAL TOTAL TOTAL
RETURN FOR RETURN FOR
1 YEAR LIFE OF FUND LIFE OF FUND
.................................................................................................................................
<S> <C> <C> <C>
Global High Yield Securities Fund 0.37% 1.82%<F1> 3.28%<F1>
Capital Appreciation Fund 36.22% 19.98%<F2> 59.35%<F2>
Small Cap Fund 51.53% 33.55%<F3> 75.37%<F3>
International Equity Fund 8.21% 14.39%<F4> 52.85%<F4>
Pacific Basin Equity Fund -8.53% 4.12%<F5> 8.03%<F5>
Latin American Equity Fund -43.66% -9.82%<F6> -18.09%<F6>
................................................................................................................................
<FN>
<F1> Portfolio commenced operations on December 14, 1993
<F2> Portfolio commenced operations on March 9, 1993.
<F3> Portfolio commenced operations on October 21, 1993.
<F4> Portfolio commenced operations on August 4, 1992.
<F5> Portfolio commenced operations on November 1, 1993.
<F6> Portfolio commenced operations on October 25, 1993.
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>

YIELD refers to the income generated by an investment in a Fund over a given
period of time, expressed as an annual percentage rate. Yields are calculated
according to a standard that is required for all stock and bond funds. Because
this differs from other accounting methods, the quoted yield may not equal the
income actually paid to shareholders. This difference may be significant for a
Fund investing in a Portfolio whose investments are denominated in foreign
currencies.

Performance information may include comparisons of a Fund's investment results
to various unmanaged indices or results of other mutual funds or investment or
savings vehicles. From time to time, Fund rankings may be quoted from various
sources, such as Lipper Analytical Services, Inc., Value Line and Morningstar,
Inc.

Unlike some bank deposits or other investments which pay a fixed yield for a
stated period of time, the total return of a Fund will vary depending upon
interest rates, the current market value of the securities held by the
corresponding Portfolio and changes in the expenses of the Fund or Portfolio. In
addition, during certain periods for which total return may be provided, Bankers
Trust or SBDS may have voluntarily agreed to waive portions of their fees, or
reimburse certain operating expenses of a Fund or Portfolio, on a month-to-month
basis. Such waivers will have the effect of increasing the Fund's net income
(and therefore its yield and total return) during the period such waivers are in
effect.

TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN INDICATION OF
FUTURE PERFORMANCE.

MANAGEMENT OF THE TRUST AND THE PORTFOLIOS
BOARD OF TRUSTEES
The Trust and each Portfolio is governed by a Board of Trustees which is
responsible for protecting the interests of investors. A majority of the
Trustees who are not "interested persons" (as defined in the 1940 Act) of the
Trust or the Portfolio, as the case may be, have adopted written procedures
reasonably appropriate to deal with potential conflicts of interest arising from
the fact that the same individuals are Trustees of the Trust and the Portfolios,
up to and including creating separate boards of trustees. See "Management of the
Trust and the Portfolios" in the SAI for more information with respect to the
Trustees and officers of the Trust and each Portfolio.

INVESTMENT ADVISER
The Trust has not retained the services of an investment adviser since the Trust
seeks to achieve the investment objective of each Fund by investing all the
Assets of the Fund in the corresponding Portfolio. Each Portfolio has retained
the services of Bankers Trust as investment adviser (the "Adviser").

BANKERS TRUST COMPANY AND ITS AFFILIATES
Bankers Trust Company, a New York banking corporation with principal offices at
280 Park Avenue, New York, New York 10017, is a wholly owned subsidiary of
Bankers Trust New York Corporation. Bankers Trust conducts a variety of general
banking and trust activities and is a major wholesale supplier of financial
services to the international and domestic institutional market.

As of September 30, 1995, Bankers Trust New York Corporation was the ninth
largest bank holding company in the United States with total assets of
approximately $104 billion. Bankers Trust is a worldwide merchant bank dedicated
to servicing the needs of corporations, governments, financial institutions and
private clients through a global network of over 120 offices in more than 40
countries. Investment management is a core business of Bankers Trust, built on a
tradition of excellence from its roots as a trust bank founded in 1903. The
scope of Bankers Trust's investment management capability is unique due to its
leadership positions in both active and passive quantitative management and its
presence in major equity and fixed income markets around the world. Bankers
Trust is one of the nation's largest and most experienced investment managers
with approximately $200 billion in assets under management globally.

Bankers Trust has more than 50 years of experience managing retirement assets
for the nation's largest corporations and institutions. In the past, these
clients have been serviced through separate account and commingled fund
structures. Now, the BT Family of Funds brings Bankers Trust's extensive
investment management expertise - once available to only the largest
institutions in the U.S. - to individual investors. Bankers Trust's officers
have had extensive experience in managing investment portfolios having
objectives similar to those of each Portfolio.

Bankers Trust, subject to the supervision and direction of the Board of Trustees
of each Portfolio, manages each Portfolio in accordance with the Portfolio's
investment objective and stated investment policies, makes investment decisions
for the Portfolio, places orders to purchase and sell securities and other
financial instruments on behalf of the Portfolio and employs professional
investment managers and securities analysts who provide research services to the
Portfolio. Bankers Trust may utilize the expertise of any of its world wide
subsidiaries and affiliates to assist it in its role as investment adviser. All
orders for investment transactions on behalf of a Portfolio are placed by
Bankers Trust with broker-dealers and other financial intermediaries that it
selects, including those affiliated with Bankers Trust. A Bankers Trust
affiliate will be used in connection with a purchase or sale of an investment
for the Portfolio only if Bankers Trust believes that the affiliate's charge for
the transaction does not exceed usual and customary levels. The Portfolio will
not invest in obligations for which Bankers Trust or any of its affiliates is
the ultimate obligor or accepting bank. The Portfolio may, however, invest in
the obligations of correspondents and customers of Bankers Trust.

The Investment Advisory Agreement provides for each Portfolio to pay Bankers
Trust a fee, accrued daily and paid monthly, equal on an annual basis to the
following percentages of the average daily net assets of the Portfolio for its
then-current fiscal year: Global High Yield Securities Portfolio, 0.80%; Capital
Appreciation Portfolio, 0.65%; Small Cap Portfolio, 0.65%; International Equity
Portfolio, 0.65%; Pacific Basin Equity Portfolio, 0.75%; and Latin American
Equity Portfolio, 1.00%. With respect to Global High Yield Securities Portfolio,
Pacific Basin Equity Portfolio, and Latin American Equity Portfolio, the
investment advisory fee is higher than that of most funds, but not necessarily
higher than that of a typical international fund, due to the greater complexity,
expense and commitment of resources involved in international investing.

Bankers Trust has been advised by its counsel that, in counsel's opinion,
Bankers Trust currently may perform the services for the Trust and the
Portfolios described in this Prospectus and the SAI without violation of the
Glass-Steagall Act or other applicable banking laws or regulations. State laws
on this issue may differ from the interpretations of relevant Federal law, and
banks and financial institutions may be required to register as dealers pursuant
to state securities law.

SUB-INVESTMENT ADVISER -- PACIFIC BASIN EQUITY PORTFOLIO
Bankers Trust has entered into a sub-investment advisory agreement (the "Sub-
Advisory Agreement") with BT Fund Managers International Limited ("BT Fund
Managers International"), a wholly owned registered investment advisory
subsidiary of Bankers Trust Australia Limited ("BTAL"). BTAL is a wholly owned
subsidiary of Bankers Trust New York Corporation. Under the Sub-Advisory
Agreement, Bankers Trust may receive investment advice and research services
with respect to companies based in the Pacific Basin and may grant BT Fund
Managers International investment management authority as well as the authority
to buy and sell securities if Bankers Trust believes it would be beneficial to
the Pacific Basin Equity Portfolio. Under the Sub-Advisory Agreement, BT Fund
Managers International receives a fee from Bankers Trust for providing
investment advice and research services, accrued daily and paid monthly, at the
annual rate of 0.60% of the average daily assets of the Portfolio.

PORTFOLIO MANAGERS
Mr. Michael Levy has been the primary portfolio manager for the International
Equity Fund since August 1995. He also heads the international active equity
team, which is responsible for the day to day management of the Portfolio. Mr.
Levy has been the head of this team since joining Bankers Trust in March, 1993,
and is a Managing Director and International Equity Strategist of Bankers Trust.
The international active equity team has provided input into the management of
the Portfolio since the Portfolio's commencement of operations. Prior to joining
Bankers Trust, Mr. Levy was an investment banker and an equity analyst with
Oppenheimer & Company. He has twenty-four years of business experience, of which
fourteen years have been in the investment industry.

Maria-Elena Carrion (CFA), Vice President of Bankers Trust, is primarily
responsible for the day-to-day management of the Latin American Equity
Portfolio. Ms. Carrion has been employed by Bankers Trust since April, 1993 and
has managed the Portfolio's assets since the Portfolio commenced operations.
Prior to April, 1993, Ms. Carrion was employed by Latin American Securities
(London) (from June, 1991 to April, 1993). Prior to June, 1991, Ms. Carrion was
employed by US Trust Company (from September, 1986 to June, 1991).

David A. Reiss, Vice President of Bankers Trust and Stephen C. Freidheim,
Managing Director of Bankers Trust are responsible for the day-to-day
management of the Global High Yield Securities Portfolio. Mr. Reiss has been
employed by Bankers Trust since March, 1994 and has managed the Portfolio's
assets since March, 1994. From September, 1989 to March, 1994, Mr. Reiss was a
Portfolio Manager at Kidder Peabody Asset Management. Prior to September,
1989, he was an associate in Mortgage Research at Goldman, Sachs & Co. Mr.
Freidheim has been employed by Bankers Trust since August, 1993 and has
managed the Portfolio's assets since December, 1993. From July, 1990 to July,
1993 he was a Senior Vice President and Director of Research and Trading at
Nomura Securities International. Mr. Freidheim was also on the Board of
Directors of Nomura Corporate Research and Asset Management. Prior to July,
1990, he was Director of Research at Kidder, Peabody High Yield Asset
Management.

Paul Durham, Vice President of BTAL, is responsible for the day-to-day
management of the Pacific Basin Equity Portfolio. Mr. Durham has been employed
by Bankers Trust since January, 1988 and has managed the Portfolio's assets
since November, 1993.

Mary Lisanti, Managing Director of Bankers Trust, is responsible for the
day-to-day management of the Capital Appreciation Portfolio and Small Cap
Portfolio. Ms. Lisanti has been employed by Bankers Trust since February, 1993
and has managed each Portfolio's assets since each Portfolio commenced
operations. Prior to 1993, she was a Vice President and Portfolio Manager with
Lieber & Company/The Evergreen Funds (since 1990).

Bankers Trust investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for personal
investing and restricts certain transactions.

ADMINISTRATOR
Under its Administration and Services Agreement with the Trust, Bankers Trust
calculates the net asset value of each Fund and generally assists the Board of
Trustees of the Trust in all aspects of the administration and operation of the
Funds. The Administration and Services Agreement provides for the Trust to pay
Bankers Trust a fee, accrued daily and paid monthly equal on an annual basis to
the following percentages of the average daily net assets of the Fund for its
then-current fiscal year: Global High Yield Securities Fund, 0.95%; Capital
Appreciation Fund, 0.65%; Small Cap Fund, 0.65%; International Equity Fund,
0.85%; Pacific Basin Equity Fund, 0.75%; and Latin American Equity Fund, 0.95%.

Under an Administration and Services Agreement with each Portfolio, Bankers
Trust calculates the value of the assets of the Portfolio and generally assists
the respective Board of Trustees in all aspects of the administration and
operation of the Portfolios. The Administration and Services Agreement provides
for each Portfolio to pay Bankers Trust a fee, accrued daily and paid monthly,
equal on an annual basis to the following percentages of the Portfolio's average
daily net assets for its then-current fiscal year: Global High Yield Securities
Portfolio, 0.20%; Capital Appreciation Portfolio, 0.10%; Small Cap Portfolio,
0.10%; International Equity Portfolio, 0.15%; Pacific Basin Equity Portfolio,
0.25%; and Latin American Equity Portfolio, 0.20%. Under each Administration and
Services Agreement, Bankers Trust may delegate one or more of its
responsibilities to others, including SBDS, at Bankers Trust's expense.

DISTRIBUTOR
Under its Distribution Agreement with the Trust, SBDS, as Distributor, serves as
the Trust's principal underwriter on a best efforts basis. In addition, SBDS
provides the Trust with office facilities. SBDS is a wholly owned subsidiary of
Signature Financial Group, Inc. ("SFG"). SFG and its affiliates currently
provide administration and distribution services for other registered investment
companies. The principal business address of SFG and SBDS is 6 St. James Avenue,
Boston, Massachusetts 02116.

DISTRIBUTION AND SERVICE PLAN
Pursuant to the terms of the Trust's Distribution and Service Plan pursuant to
Rule 12b-1 under the 1940 Act (the "Plan"), each Fund shall pay SBDS service
fees equal on an annual basis up to 0.25% of each Fund's average daily net
assets as reimbursement for the costs of compensating Investment Professionals
for providing personal shareholder services and maintaining shareholder
accounts. In addition, each Fund shall pay SBDS a distribution fee equal on an
annual basis to 0.25% (0.10% in the case of Global High Yield Securities Fund)
of each Fund's average daily net assets as reimbursement for expenses incurred
in connection with any activities primarily intended to result in the sale of
the Fund's shares, including, but not limited to: printing of prospectuses,
statements of additional information and reports for other than existing
shareholders; payment of asset-based sales charges or commissions to Investment
Professionals; costs of placing advertising in various media; services of
parties in formulating sales literature; and typesetting, printing and
distribution of sales literature. All costs and expenses in connection with
implementing and operating the Plan will be paid by each Fund, subject to the
0.50% (0.35% in the case of Global High Yield Securities Fund) of net assets
limitation. All costs and expenses associated with preparing the Prospectus and
SAI and in connection with printing them for and distributing them to existing
shareholders and regulatory authorities, which costs and expenses would not be
considered distribution expenses for purposes of the Plan, will also be paid by
the Funds. To the extent expenses of SBDS under the Plan in any fiscal year of
the Trust exceed amounts payable under the Plan during that year, those expenses
may be reimbursed in a succeeding fiscal year; however, no carrying charge or
interest will be added to the amount of the expense. Expenses incurred in
connection with distribution activities will be identified to each Fund or the
other series of the Trust involved, although it is anticipated that some
activities may be conducted on a Trust-wide basis, with the result that those
activities will not be identifiable to any particular series. In the latter
case, expenses will be allocated among the series of the Trust on the basis of
their relative net assets.

CUSTODIAN AND TRANSFER AGENT
Bankers Trust acts as custodian of the assets of the Trust and each Portfolio
and serves as the transfer agent (the "Transfer Agent") for the Trust and each
Portfolio under the Administration and Services Agreement with the Trust and
each Portfolio.

ACCOUNT INFORMATION

TYPES OF ACCOUNTS
Read your Investment Professional's program materials in conjunction with this
Prospectus for details of services that may differ from those described in the
Prospectus and for additional fees that may apply. Some of the services and
features of this Prospectus may not be available to you. Certain features of the
Funds, such as minimum initial or subsequent investment amounts, may be modified
in these programs, and administrative charges may be imposed for the services
rendered.

The different ways to set up (register) your account with BT Advisor Funds are
listed below.

The account guidelines that follow may not apply to certain Funds or to certain
retirement accounts. If your employer offers a Fund through a retirement
program, contact your employer for more information. Otherwise, call your
Investment Professional directly.

WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have two or more
owners (tenants). Joint accounts may be joint tenants in common or joint tenants
with rights of survivorship.

RETIREMENT
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES
Retirement plans allow individuals to shelter investment income and capital
gains from current taxes. In addition, contributions to these accounts may be
tax deductible. Retirement accounts require special applications and typically
have lower minimums.

* INDIVIDUAL RETIREMENT ACCOUNTS ("IRAS") allow anyone of legal age under 70 1/2
with earned income to invest up to $2,000 per tax year. Individuals can also
invest in a spouse's IRA if the spouse has earned income of less than $250.

* ROLLOVER IRAS retain special tax advantages for certain distributions from
employer sponsored retirement plans.

* SIMPLIFIED EMPLOYEE PENSION PLANS ("SEP-IRAS") provide small business owners
or those with self-employed income (and their eligible employees) with many of
the same advantages as a Keogh, but with fewer administrative requirements.

* 401(K) PLANS allow employees of corporations of all sizes to contribute a
percentage of their wages on a tax deferred basis. These accounts need to be
established by the trustee of the plan.

* MONEY PURCHASE/PROFIT SHARING PLANS ("KEOGH PLANS") are tax deferred pension
accounts designated for employees of unincorporated businesses or for persons
who are self-employed.

GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and obtain tax
benefits. An individual can give up to $10,000 a year per child without paying
federal gift tax. Depending on state laws, you can set up a custodial account
under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors
Act (UTMA). Contact your Investment Professional.

TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.

BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Contact your Investment Professional.

HOW TO BUY SHARES
Once each business day, two share prices are calculated for shares of each Fund:
the offering price and the NAV. The offering price includes a front-end sales
charge, which you pay when you buy shares of a Fund, unless you qualify for a
reduction or waiver as described on page 34. When you buy shares at the offering
price, the Transfer Agent deducts the applicable sales charge and invests the
rest at NAV.

Shares are purchased at the next offering price or NAV, as applicable,
calculated after your investment is received and accepted. The offering price
and NAV are normally calculated at 4:00 p.m. Eastern time.

If you are placing your order through an Investment Professional, it is the
responsibility of your Investment Professional to transmit your order to buy
Shares to the Transfer Agent before 4:00 p.m. Eastern time.

The Transfer Agent must receive payment within three business days after an
order for Shares is placed; otherwise your purchase order may be canceled and
you could be held liable for resulting fees and/or losses.

Share certificates are not available for Shares of the Funds.

IF YOU ARE NEW TO BT ADVISOR FUNDS, complete and sign an account application and
mail it along with your check. If there is no account application accompanying
this Prospectus, call your Investment Professional.

IF YOU ALREADY HAVE MONEY INVESTED IN A FUND IN THE BT FAMILY OF FUNDS, you can:

* Mail an account application with a check,
* Wire money into your account,
* Open an account by exchanging from another fund in the BT Family of Funds,
or
* Contact your Investment Professional.

If you are investing through a tax-sheltered retirement plan, such as an IRA,
for the first time, you will need a special application. Contact your
Investment Professional for more information and a retirement account
application.
- ------------------------------------------------------------------------------

MINIMUM INVESTMENTS

TO OPEN AN ACCOUNT $2,500
For retirement accounts $ 500
Through automatic investment plans $1,000

TO ADD TO AN ACCOUNT $ 250
For retirement accounts $ 100
Through automatic investment plan $ 100

MINIMUM BALANCE $1,000
For retirement accounts None

For further information on opening an account, please consult your Investment
Professional or refer to the account application.

- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
<S> <C> <C>
PHONE YOUR Contact your Investment Professional. If you are an Contact your Investment Professional or call 1-
INVESTMENT PROFESSIONAL existing Shareholder, you may exchange from another (800)-730-1313. You may exchange from another BT
BT account with the same registration, including Advisor Funds account (or a fund in the BT Family of
name, address, and taxpayer ID number. Funds) with the same registration, including name,
address and taxpayer ID number.
- -----------------------------------------------------------------------------------------------------------------------------------
MAIL Complete and sign the account application. Make your Make your check payable to the complete name of the
check payable to the complete name of the Fund of Fund of your choice. Indicate your Fund account
your choice. Mail to the appropriate address number on your check and mail to the address printed
indicated on the application. on your account statement.

Exchange by mail: Call your Investment Professional
for instructions.
- -----------------------------------------------------------------------------------------------------------------------------------
IN PERSON Take your account application and check to your Take your check to your Investment Professional.
Investment Professional.
- -----------------------------------------------------------------------------------------------------------------------------------
WIRE Not available. Call your Investment Professional or wire to:

ROUTING NO.: 021001033
ATTN: Bankers Trust/IFTC Deposit
DDA NO.: 00-226-296
FBO: (Account name)
(Account number)
CREDIT: Fund Number
Global High Yield Securities Fund - 506
Capital Appreciation Fund - 501
Small Cap Fund - 502
International Equity Fund - 503
Pacific Basin Equity Fund - 504
Latin American Equity Fund - 505

Specify the complete name of the fund of your
choice, and include your account number and your
name.
- -----------------------------------------------------------------------------------------------------------------------------------
AUTOMATIHCALLY Not available. Use the Systematic Investment Program. Sign up for
this service when opening your account on your
application, or call your Investment Professional to
begin the program. The initial minimum investment in
this program is $1,000.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by selling
(redeeming) some or all of your Shares. Your Shares shall be sold at the next
NAV calculated after an order is received by the Transfer Agent. NAV is normally
calculated at 4:00 p.m. Eastern time.

TO SELL SHARES IN A RETIREMENT ACCOUNT, your request must be made in writing,
except for exchanges to other eligible funds in the BT Family of Funds, which
can be requested by phone or in writing. For information on retirement
distributions contact your Investment Professional or call 1-800-677-7596.

IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR NON-RETIREMENT ACCOUNT SHARES, leave
at least $1,000 worth of shares in the account to keep it open.

TO SELL SHARES BY BANK WIRE you will need to sign up for these services in
advance when completing your account application.

CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to protect
you and Bankers Trust from fraud. Your request must be made in writing and
include a signature guarantee if any of the following situations apply:

* You wish to redeem more than $100,000 worth of Shares, * Your account
registration has changed within the last 30 days, * The check is being mailed to
a different address than the one on your account (record address),
* The check is being made payable to someone other than the account owner,
* The redemption proceeds are being transferred to a BT account with a
different registration, or
* You wish to have redemption proceeds wired to a non-predesignated bank
account.

You should be able to obtain a signature guarantee from a bank, broker, dealer,
credit union (if authorized under state law), securities exchange or
association, clearing agency, or savings association. A notary public cannot
provide a signature guarantee.

SELLING SHARES IN WRITING
Write a "letter of instruction" with:

* Your name,
* The Fund's name and Fund's number,
* our Fund account number,
* The dollar amount or number of Shares to be redeemed and
* Any other applicable requirements listed in the following table.

Deliver your letter to your Investment Professional, or mail it to the following
address:

Bankers Trust Company
P.O. Box 419210
Kansas City, MO 64141-6210

overnight mailings:

Bankers Trust Company
210 West 10th Street, 8th Floor
Kansas City, MO 64105-1716

Unless otherwise instructed, the Transfer Agent will send a check to the record
address.

ADDITIONAL INFORMATION ABOUT SELLING SHARES

<TABLE>
<CAPTION>
ACCOUNT TYPE SPECIAL REQUIREMENTS
<S> <C> <C>
PHONE YOUR All account types except retirement Maximum check request: $100,000
INVESTMENT PROFESSIONAL

All account types You may exchange to other BT Advisor Funds
(or other funds in the BT Family of Funds)
if both accounts are registered with the same
name(s), address, and taxpayer ID number.
- ---------------------------------------------------------------------------------------------------------------------------------
MAIL OR IN PERSON Individual, Joint Tenant, Sale Proprietorship, The letter of instruction (with signature
UGMA, UTMA guaranteed, if required) must be signed by all
persons required to sign for transactions,
exactly as their names appear on the account
and sent to your Investment Professional or
the Transfer Agent.

Retirement account The account owner should complete a retirement
distribution form. Contact your Investment
Professional or call 1-800-677-7596.

Trust The trustee must sign the letter indicating
capacity as trustee. If the trustee's name
is not on the account registration, provide a
copy of the trust document certified with the
last 60 days.

Business or Organization At least one person authorized by corporate
resolution to act on the account must sign
the letter.

Executor, Administrator, Conservator/Guardian For instructions contact your Investment
Professional or call 1-800-730-1313.
- ---------------------------------------------------------------------------------------------------------------------------------
WIRE All account types except retirement You must sign up for the wire feature before
using it. To verify that it is in place,
contact your Investment Professional or call 1-
800-730-1313. Minimum wire: $1,000. Your wire
redemption request must be received by the
Transfer Agent before 4:00 p.m. Eastern time
for money to be wired on the next business day.
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

INVESTOR SERVICES
BT Advisor Funds provide a variety of services to help you manage your account.

INFORMATION SERVICES
STATEMENTS AND REPORTS that your Investment Professional or the Transfer Agent
will send to you include the following:

* Confirmation statements (after every transaction that affects your account
balance, including distributions or your account registration)

* Account statements (quarterly)

* Financial reports (every six months)

To reduce expenses, only one copy of most financial reports will be mailed, even
if you have more than one account in the Fund. Call your Investment Professional
if you need additional copies of financial reports.

TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your Shares and buy Shares of other funds in
the BT Family of Funds by telephone or in writing. The shares you exchange will
carry credit for any front-end sales charge you previously paid in connection
with their purchase. If you are exchanging from the Global High Yield Securities
Fund to another Fund, no incremental sales charge will be assessed.

Note that exchanges out of a Fund may be limited to four per calendar year and
that they may have tax consequences for you. For detail on policies and
restrictions governing exchanges including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see page 34.

REGULAR INVESTMENT PLANS
SYSTEMATIC INVESTMENT PROGRAM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO BT ADVISOR FUNDS

<TABLE>
<CAPTION>
MINIMUM MINIMUM FREQUENCY SETTING UP OR CHANGING
INITIAL SUBSEQUENT
<S> <C> <C> <C>
$1,000 $100 Monthly, bimonthly, For a new account, complete the appropriate section on the application.
quarterly or
semi-annually For existing accounts, call your Investment Professional for an
application.

To change the amount or frequency of your investment, contact your
Investment Professional directly or call 1-800-730-1313. Call
at least 10 business days prior to your next scheduled investment date.
</TABLE>

SYSTEMATIC WITHDRAWAL PROGRAM lets you set up periodic redemptions from your
account. Because of the Shares' front-end charge, you may not want to set up a
systematic withdrawal plan during a period when you are buying Shares on a
regular basis.

<TABLE>
<CAPTION>
MINIMUM FREQUENCY SETTING UP OR CHANGING

<S> <C> <C>
$100 Monthly, quarterly, semi-annually, or annually To establish call your Investment Professional
or call 1-800-730-1313 after your account is
open. The accounts from which the withdrawals
be processed must have a minimum balance of
$10,000.
</TABLE>

One easy way to pursue your financial goals is to invest money regularly. BT
Advisor Funds offer convenient services that let you transfer money into your
fund account, or between fund accounts automatically. While regular investment
plans do not guarantee a profit and will not protect you against loss in a
declining market, they can be an excellent way to invest for retirement, a home,
educational expenses, and other long-term financial goals. Certain restrictions
apply for retirement accounts. Call your Investment Professional for more
information.

SYSTEMATIC EXCHANGE PROGRAM
TO MOVE MONEY FROM ONE FUND IN THE BT FAMILY OF FUNDS TO ANOTHER

<TABLE>
<CAPTION>
MINIMUM FREQUENCY SETTING UP OR CHANGING
<S> <C> <C>
$100 Monthly, quarterly, semi-annually or annually To establish, call your Investment Professional
after both accounts are open.
To change the amount or frequency of your
investment, contact your Investment
Professional directly or call 1-800-730-1313.
Call at least two business days prior to your
next scheduled exchange date.

The account from which the exchanges are to be
processed must have a minimum balance of $10,000.
The account into which the exchange is being
processed must have a minimum of $1,000.
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

SHAREHOLDER AND ACCOUNT POLICIES

DIVIDENDS, CAPITAL GAINS, AND TAXES
Each Fund distributes substantially all of its net income and capital gains to
shareholders each year. Each Fund distributes capital gains annually. Normally,
income dividends for the Global High Yield Securities Fund and the Capital
Appreciation Fund are distributed quarterly; income dividends for the Small Cap
Fund, International Equity Fund, Pacific Basin Equity Fund and the Latin
American Equity Fund are distributed annually.

DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you want to
receive distributions. The Trust offers four options:

1. REINVESTMENT OPTION. Your dividend and capital gain distributions will be
automatically reinvested in additional Shares of the Fund. If you do not
indicate a choice on your application you will be assigned this option.

2. INCOME-EARNED OPTION. Your capital gain distributions will be automatically
reinvested in additional Shares of the Fund, but you will be sent a check for
each dividend distribution.

3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.

4. AUTOMATIC DIVIDENDS PROGRAM. Your dividend and capital gain distributions
be automatically invested in Shares of another fund in the BT Family of Funds
as long as minimums for that account are met.

If you select distribution option 2 or 3 and the U.S. Postal Service cannot
deliver your checks, or if your checks remain uncashed for six months, those
checks will be reinvested in your account at the current NAV and your election
may be converted to the Reinvestment Option. You may change distribution option
at anytime by notifying the Transfer Agent in writing.

FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested. When
you are over 59 1/2 years old, you can receive distributions in cash. If
distributions from a retirement account for any taxable year following the year
in which the participant reaches age 70 1/2 are less than the "minimum required
distribution" for that taxable year, an excise tax equal to 50% of the
deficiency may be imposed by the Internal Revenue Service (the "IRS"). The
administrator, trustee or custodian of such a retirement account will be
responsible for reporting distributions from such accounts to the IRS.

Shares purchased through reinvestment of dividend and capital gain distributions
are not subject to a sales charge.

When each of the Funds deducts a distribution from its NAV, the reinvestment
price is the applicable Fund's NAV at the close of business that day.
Distribution checks will be mailed within seven days, or longer for a December
ex-dividend date.

TAXES
As with any investment, you should consider how an investment in the Funds could
affect you. Below are some of the Funds' tax implications. If your account is
not a tax-deferred retirement account beware of these tax implications.

TAXES ON DISTRIBUTIONS. Distributions from the Funds are subject to federal
income tax and may also be subject to state or local taxes. Annual statements as
to the federal tax status of distributions, and distributions that are
attributable to state and local income and personal taxes, if applicable, will
be mailed to shareholders shortly after the end of the year. If living outside
the United States, your distributions from the Funds could also be taxed by the
country in which you reside.

For federal tax purposes, income and short-term capital gain distributions from
each of the Funds are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains.

Mutual fund dividends from U.S. government securities are generally free from
state and local income taxes. However, particular states may limit this benefit,
and some types of securities, such as repurchase agreements and some
agency-backed securities, may not qualify for the benefit. In addition, some
states may impose intangible property taxes. You should consult your own tax
adviser for details and up-to-date information on the tax laws in your state.

Distributions are taxable when they are paid, whether you take them in cash or
reinvest them. However, distributions declared in December and paid in January
are taxable as if they were paid on December 31.

Every January, the Transfer Agent will send the IRS a statement showing the
taxable distributions paid to you in the previous year.

TAXES ON TRANSACTIONS. Your redemptions, including exchanges, are subject to
capital gains tax. A capital gain or loss is the difference between the cost of
your Shares and the price you receive when you sell them.

Whenever you sell Shares of a Fund, the Transfer Agent will send you or your
Investment Professional a confirmation statement showing how many Shares you
sold and at what price. You also receive a consolidated transaction statement at
least quarterly. However, it is up to you or your tax preparer to determine
whether this sale resulted in a capital gain and, if so, the amount of tax to be
paid. BE SURE TO KEEP YOUR REGULAR ACCOUNT STATEMENTS; the information they
contain will be essential in calculating the amount of your capital gains.

"BUYING A DIVIDEND." If you buy Shares just before a Fund deducts a capital gain
distribution or dividend distribution, as applicable, from its NAV, you will pay
the full price for the Shares and then receive a portion of the price back in
the form of a taxable distribution.

CURRENCY CONSIDERATIONS. If a Fund's dividends exceed its taxable income in any
year, which is sometimes the result of currency-related losses, all or a portion
of the Fund's dividends may be treated as a return of capital to shareholders
for tax purposes. To minimize the risk of a return of capital, each of the Funds
may adjust its dividends to take currency fluctuations into account, which may
cause the dividends to vary. Any return of capital will reduce the cost basis of
your Shares, which will result in a higher reported capital gain or a lower
reported capital loss when you sell your Shares. The statement you receive in
January will specify whether any distributions included a return of capital.

Undistributed net gains from currency transactions, if any, will generally be
distributed as a separate dividend in December.

There are tax requirements that all Funds must follow in order to avoid federal
taxation. In its effort to adhere to these requirements, a Fund may have to
limit its investment activity in some types of instruments.

VALUATION DETAILS
THE FUNDS ARE OPEN FOR BUSINESS each day the NYSE is open. Each Fund's NAV and
offering price, as applicable, is calculated as of the close of regular trading
on the NYSE, currently 4:00 p.m. Eastern time.

A FUND'S NAV is the net asset value of a single Share. The NAV of each Fund is
computed by dividing the value of the Fund's Assets (i.e., the value of its
investment in the Portfolio and other assets), less all liabilities, by the
total number of its Shares outstanding. Each Portfolio's securities and other
assets are valued primarily on the basis of market quotations or, if quotations
are not readily available, by Bankers Trust pursuant to procedures adopted by
the Portfolio's Board of Trustees. These procedures require Bankers Trust to
value such a security at the same value as an equivalent security which is
readily marketable and, in making such comparisons, to consider all relevant
factors under applicable guidelines of the SEC.

THE OFFERING PRICE (price to buy one Share) is the applicable Fund's NAV, plus a
sales charge. The Funds have a maximum sales charge of 4.75% of the offering
price (3.75% for the Global High Yield Securities Fund).

SALES CHARGES AND INVESTMENT PROFESSIONAL CONCESSIONS
(FOR EACH FUND EXCEPT THE GLOBAL HIGH YIELD SECURITIES FUND)
- ------------------------------------------------------------------------------

<TABLE>
<CAPTION>
AMOUNT INVESTED INVESTMENT
SALES CHARGE PROFESSIONAL
AS A % OF CONCESSION AS
OFFERING NET AMOUNT % OF OFFERING
PRICE INVESTED PRICE
................................................................................................................................
<S> <C> <C> <C>
Less than $50,000 4.75% 4.99% 4.00%
$50,000 to less than $100,000 4.50 4.71 4.00
$100,000 to less than $250,000 3.50 3.63 3.00
$250,000 to less than $500,000 2.50 2.56 2.00
$500,000 to less than $1 million 2.00 2.04 1.75
$1 million or more None None See below<F1>

GLOBAL HIGH YIELD SECURITIES FUND

<CAPTION>
AMOUNT INVESTED INVESTMENT
SALES CHARGE PROFESSIONAL
AS A % OF CONCESSION AS
OFFERING NET AMOUNT % OF OFFERING
PRICE INVESTED PRICE
................................................................................................................................
<S> <C> <C> <C>
Less than $50,000 3.75% 3.90% 3.00%
$50,000 to less than $100,000 3.50 3.63 3.00
$100,000 to less than $250,000 2.50 2.56 2.00
$250,000 to less than $500,000 1.50 1.52 1.00
$500,000 to less than $1 million 1.00 1.01 0.75
$1 million or more None None See below<F1>

<FN>
<F1>Investment Professionals will be compensated with a fee (based on average assets) of 1.00% for purchase amounts of $1 million
to $3 million of assets, 0.50% on the next $3 million to $20 million of assets and 0.15% for assets over $20 million. Assets
must remain in the Fund(s) for a period of 18 uninterrupted months, or the Investment Professional will be required to
refund this fee to SBDS. If the assets are exchanged into a BT Advisor Fund which does not have a sales charge within the 18
month period, the Investment Professional will be required to refund this fee.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

REINSTATEMENT PRIVILEGE. If an investor sold all or part of their Shares of a
Fund, they may reinvest an amount equal to all or a portion of the redemption
proceeds in the same Fund or another BT Advisor Fund, without paying any sales
charge, at the NAV next determined after receipt of the investment order,
provided that such reinvestment is made within 30 days of redemption. An
investor must reinstate their Shares into an account with the same registration.
This privilege may be exercised only once by a shareholder with respect to a
Fund and certain restrictions may apply.

WHEN AN INVESTOR SIGNS AN ACCOUNT APPLICATION, they will be asked to certify
that their social security or taxpayer identification number is correct and that
they are not subject to 31% backup withholding for failing to report income to
the IRS. If they violate IRS regulations, the IRS can require a Fund to withhold
31% of the investor's taxable distributions and redemptions.

AN INVESTOR MAY INITIATE MANY TRANSACTIONS BY TELEPHONE: An Investment
Professional or the Transfer Agent may only be liable for losses resulting from
unauthorized transactions if they do not follow reasonable procedures designed
to verify the identity of the caller. An Investment Professional or the Transfer
Agent will request personalized security codes or other information, and may
also record calls. An investor should verify the accuracy of the confirmation
statements immediately after receipt. If investors do not want the ability to
redeem and exchange by telephone, they should call their Investment Professional
or the Transfer Agent for instructions. Additional documentation may be required
from corporations, associations and certain fiduciaries.

EACH FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period of
time. Each Fund also reserves the right to reject any specific purchase order,
including certain purchases by exchange. Purchase orders may be refused if, in
Bankers Trust's opinion, they would disrupt management of a Fund.

WHEN INVESTORS PLACE AN ORDER TO BUY SHARES, their Shares will be purchased at
the next NAV or offering price, as applicable, calculated after the order is
received and accepted by the Transfer Agent. Note the following:

* All checks should be made payable to the specific Fund.

* All purchases must be made in U.S. dollars and checks must be drawn on U.S.
banks.

* The Funds do not accept third-party checks, except those payable to an
existing shareholder who is a natural person (not a corporation or
partnership), credit cards or cash.

* When making a purchase with more than one check, each check must have a value
of at least $50.

* Each Fund reserves the right to limit the number of checks processed at one
time.

* If a check does not clear, the purchase will be cancelled and the investor
could be liable for any losses or fees a Fund or the Transfer Agent has
incurred.

* When purchase orders are made by check or periodic automatic investment,
redemptions will not be allowed until the investment being redeemed has been
in the account for 15 business days.

* Direct Purchases: Investors begin to earn dividends as of the first business
day following the day the Fund receives payment.

* Automated Order Purchases: Investors begin to earn dividends as of the
business day your order is received and accepted.

AUTOMATED ORDERS PURCHASE. Shares of the Funds can be purchased or sold through
Investment Professionals utilizing an automated order placement and settlement
system that guarantees payment for orders on a specified date.

TO AVOID THE COLLECTION PERIOD associated with check purchases, consider buying
Shares by bank wire, U.S. Postal money order, U.S. Treasury check, or Federal
Reserve check.

WHEN INVESTORS PLACE AN ORDER TO SELL SHARES, Shares will be sold at the next
NAV calculated after the order is received and accepted. Note the following:

* Normally, redemption proceeds will be mailed on the next business day, but if
making immediate payment could adversely affect a Fund it may take up to seven
days to pay you.

* Shares of the Funds will earn dividends through the date of redemption;
however, Shares redeemed on a Friday or prior to a holiday will continue to
earn dividends until the next business day.

* Each Fund may hold payment on redemptions until it is reasonably satisfied
that investments made by check have been collected which can take up to seven
business days.

* Redemptions may be suspended or payment dates postponed when the NYSE is
closed (other than weekends or holidays), when trading on the NYSE is
restricted, or as permitted by the SEC.

THE TRANSFER AGENT RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts with a value of less than $2,500 (including any amount paid
as a sales charge). The fee, which is payable to the Transfer Agent, is designed
to offset in part the relatively higher costs of servicing smaller accounts.

IF A NON-RETIREMENT ACCOUNT BALANCE FALLS BELOW $1,000, the investor will be
given 30 days' notice to reestablish the minimum balance. If the investor does
not increase their balance, the Transfer Agent reserves the right to close the
account and send the proceeds to the investors. Shares will be redeemed at the
NAV on the day the account is closed.

THE TRANSFER AGENT MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its services.

EXCHANGE LIMITATIONS
As a shareholder, you have the privilege of exchanging Shares of a Fund for
Shares of other funds in the BT Family of Funds. However, investors should note
the following:

* The Fund an investor exchanges into must be registered for sale in their
state.

* Investors may only exchange between accounts that are registered in the same
name, address, and taxpayer identification number.

* Before exchanging into a Fund, investors should read its Prospectus.

* Exchanges between the Funds described in this Prospectus and Funds described
in other BT Funds' prospectuses are restricted during the 90 days following
purchase. Exchanges among the Funds described in this Prospectus are permitted
at any time after purchase.

* Exchanges may have tax consequences for you.

* Because excessive trading can hurt Fund performance and shareholders, each
Fund reserves the right to temporarily or permanently terminate the exchange
privilege of any investor who makes more than four exchanges out of the Fund
per calendar year. Accounts under common ownership or control, including
accounts with the same taxpayer identification number, will be counted
together for purposes of the four exchange limit.

* Each Fund reserves the right to refuse exchange purchases by any person or
group if, in Bankers Trust's judgment, the Fund would be unable to invest the
money effectively in accordance with its investment objective and policies, or
would otherwise potentially be adversely affected.

* Exchanges may be restricted or refused if a Fund receives or anticipates
simultaneous orders affecting significant portions of the Fund's assets. In
particular, a pattern of exchanges that coincide with a "market timing"
strategy may be disruptive to a Fund.

* Although the Funds will attempt to give prior notice whenever they are
reasonably able to do so, they may impose these restrictions at any time. The
Funds reserve the right to terminate or modify the exchange privilege in the
future on 60 days' notice to shareholders.

SALES CHARGE REDUCTIONS AND WAIVERS
The front-end sales charge will be reduced for purchases of shares according to
the Sales Charge Schedule shown on page 32 if your purchase qualifies for one of
the following reduction plans.

The following programs are available for front-end sales charge reduction.

QUANTITY DISCOUNTS apply to purchases of Shares of a single Fund or to
combined purchases of Shares of other BT Advisor Funds, including Funds in
this Prospectus and in any other BT Advisor Funds' prospectus. (Minimum
investment is $50,000).

To qualify for a Quantity Discount, investing in a Fund's Shares for several
accounts at the time same time will be considered a single transaction (Combined
Purchase), as long as Shares are purchased through one Investment Professional
and the total is at least $50,000.

RIGHTS OF ACCUMULATION let you determine your front-end sales charge on a Fund's
Shares by adding to your new purchase the value of all of BT Advisor Fund Shares
including Funds in this Prospectus and in any other BT Advisor Funds' prospectus
held by you, your spouse, and your children under age 21.

A LETTER OF INTENT lets you receive the same reduced front-end sales charge on
purchases of Shares made during a 13-month period as if the total amount
invested during the period in BT Advisor Funds in this Prospectus and in any BT
Advisor Funds' prospectus had been invested in a single lump sum (see "Quantity
Discounts" above). You must file your non-binding Letter within 90 days of the
start of your purchases. Your initial investment must be at least 5% of the
amount you plan to invest. Out of the initial investment, 5% of the dollar
amount specified in the Letter will be registered in your name and held in
escrow. You will earn income dividends and capital gain distributions on
escrowed Shares. Neither income dividends nor capital gain distributions
reinvested in additional Shares will apply toward completion of the Letter. The
escrow will be released when your purchase of the total amount has been
completed. You are not obligated to complete the Letter, and in such a case,
sufficient escrowed Shares will be redeemed to pay any applicable front-end
sales charges.

A front-end sales charge will not apply to the following Shares:

1. Purchased by an existing Bankers Trust investment management client;

2. Purchased by a bank trust officer, registered representative, or other
employee (or a member of one of their immediate families) of Investment
Professionals having agreements with SBDS or Bankers Trust;

3. Purchased by a current or former trustee or officer of a BT Fund or a
current or retired officer, director or regular employee of Bankers Trust or its
direct or indirect subsidiaries (a Bankers Trust trustee or employee), the
spouse of a Bankers Trust trustee or employee, a Bankers Trust trustee or
employee acting as custodian for a minor child, or a person acting as trustee of
a trust for the sole benefit of the minor child of a Bankers Trust trustee or
employee;

4. Purchased by a charitable organization (as defined in Section 501(c)(3) of
the Internal Revenue Code) investing $100,000 or more;

5. Purchased for a charitable remainder trust or life income pool established
for the benefit of a charitable organization (as defined in Section 501 (c)
(3) of the Internal Revenue Code);

6. Purchased by a trust institution or bank trust department investing on its
own behalf or on behalf of its clients;

7. Purchased in an account for which an Investment Professional, bank,
broker-dealer or financial advisor charges an asset management fee, provided the
Investment Professional's bank, broker-dealer or financial advisor has an
agreement with SBDS or Bankers Trust;

8. Purchased as part of an employee benefit plan having more than 200 eligible
employees or a minimum of $1 million of plan assets.

9. Purchased for any state, county, or city, or any governmental
instrumentality, department, authority or agency; or

10. Purchased with redemption proceeds from other mutual fund complexes on which
you have previously paid a front-end sales charge.

11. Purchased as part of an IRA, 401(k) or other retirement plan rollover.

12. Purchased as an exchange from any Fund in this Prospectus or in any other
BT Funds' prospectus.

ADDITIONAL INFORMATION ABOUT THE TRUST AND PORTFOLIOS
Each Fund is a mutual fund: an investment that pools shareholders' money and
invests it toward a specified goal. Each Fund (with the exception of the Global
High Yield Securities Fund) is a separate diversified series of BT Advisor
Funds, a Massachusetts business trust. The Global High Yield Securities Fund is
a non-diversified series of BT Advisor Funds. Each of the Small Cap Portfolio,
Pacific Basin Equity Portfolio and Latin American Equity Portfolio is a separate
diversified subtrust of BT Investment Portfolios, a New York master trust fund.
The Global High Yield Securities Portfolio is a non-diversified subtrust of BT
Investment Portfolios. Each of the Capital Appreciation Portfolio and
International Equity Portfolio is a New York trust.

Each of the Trust and BT Investment Portfolios reserves the right to add
additional series in the future. The Trust also reserves the right to issue more
than one class of shares of each Fund.

The Trust or a Portfolio may hold special meetings and mail proxy materials.
These meetings may be called to elect or remove trustees, change fundamental
policies, approve Portfolio's investment advisory agreement, or for other
purposes. Shareholders not attending these meetings are encouraged to vote by
proxy. The Trust's Transfer Agent will mail proxy materials in advance,
including a voting card and information about the proposals to be voted on.

When matters are submitted for shareholder vote, shareholders of each Fund will
have one vote for each full share held and proportionate, fractional votes for
fractional shares held. A separate vote of one of the Funds is required on any
matter affecting only that Fund on which shareholders are entitled to vote.
Shareholders of a Fund are not entitled to vote on Trust matters that do not
affect that Fund and do not require a separate vote of the Fund. All series of
the Trust will vote together on certain matters, such as electing trustees or
approving independent public auditors. There normally will be no meetings of
shareholders for the purpose of electing Trustees unless and until such time as
less than a majority of Trustees holding office have been elected by
shareholders, at which time the Trustees then in office will call a
shareholders' meeting for the election of Trustees. Any Trustee may be removed
from office upon the vote of shareholders holding at least two-thirds of the
Trust's outstanding shares at a meeting called for that purpose. The Trustees
are required to call such a meeting upon the written request of shareholders
holding at least 10% of the Trust's outstanding shares. The Trust will also
assist shareholders in communicating with one another as provided for in the
1940 Act.

Each series of the Trust will vote separately on any matter involving the
corresponding Portfolio. Shareholders of all of the series of the Trust will,
however, vote together to elect Trustees of the Trust and for certain other
matters. Under certain circumstances, the shareholders of one or more series
could control the outcome of these votes. The series of BT Investment Portfolios
will vote together or separately on matters in the same manner, and in the same
circumstances, as do the series of the Trust. As with the Trust, the investors
in one or more series of BT Investment Portfolios could control the outcome of
these votes.

The Trust is an entity of the type commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of such a business trust may,
under certain circumstances, be held personally liable as partners for its
obligations. However, the risk of a shareholder incurring financial loss on
account of shareholder liability is limited to circumstances in which both
inadequate insurance existed and the Trust itself was unable to meet its
obligations.

Each Portfolio was organized as a trust under the laws of the State of New York.
Each Portfolio's Declaration of Trust provides that each Fund and other entities
investing in a Portfolio (e.g., other investment companies, insurance company
separate accounts and common and commingled trust funds) will each be liable for
all obligations of that Portfolio. However, the risk of a Fund incurring
financial loss on account of such liability is limited to circumstances in which
both inadequate insurance existed and a Portfolio itself was unable to meet its
obligations. Accordingly, the Trustees of the Trust believe that neither the
Funds nor their shareholders will be adversely affected by reason of the Funds'
investing in the Portfolios. No series of BT Investment Portfolios has any
preference over any other series.
<PAGE>

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

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

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

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

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

B - Bonds rated B generally lack characteristics of a desirable investment.
Assurance of interest and principal payments or of maintenance of other terms of
the contract over any long period of time may be small.

Caa - Bonds rated Caa are of poor standing. Such issues may be in default or
there may be present elements of danger with respect to principal or interest.

Ca - Bonds rated Ca represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked short-comings.

C - Bonds rated C are the lowest-rated class of bonds and issued so rated can be
regarded as having extremely poor prospects of ever attaining any real
investment standing.

Moody's applies numerical modifiers, 1, 2, and 3, in each generic rating
classification from Aa through B in its corporate bond system. The modifier 1
indicates that the security ranks in the higher end of its generic rating
category; the modifier 2 indicates a mid-range ranking; and the modifier 3
indicates that the issue ranks in the lower end of its generic rating category.

DESCRIPTION OF S&PS CORPORATE BOND RATINGS:
AAA- Debt rated AAA has the highest rating assigned by Standard & Poor's to a
debt obligation. Capacity to pay interest and repay principal is extremely
strong.

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

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

BBB - Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to weakened capacity to pay interest and repay principal for debt
in this category than in higher-rated categories.

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

B - Debt rated B has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial, or economic conditions will likely impair capacity or willingness to
pay interest and repay principal. The B rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied BB- rating.

CCC - Debt rated CCC has a currently identifiable vulnerability to default, and
is dependent upon favorable business, financial, and economic conditions to meet
timely payment of interest and repayment of principal. In the event of adverse
business, financial, or economic conditions, it is not likely to have the
capacity to pay interest and repay principal.

CC - Debt rated CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC debt rating.

C - The rating C is typically applied to debt subordinated to senior debt which
is assigned an actual or implied CCC- debt rating. The C rating may be used to
cover a situation where a bankruptcy petition has been filed but debt service
payments are continued.

CI - The rating CI is reserved for income bonds on which no interest is being
paid.

D - Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. The D rating will also be used upon the
filing of a bankruptcy petition if debt service payments are jeopardized.

Description of S&P commercial paper ratings:
Commercial paper rated A-1 by S&P indicates that the degree of safety regarding
timely payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted A-1+.

Description of Moody's commercial paper ratings:
The rating Prime-1 is the highest commercial paper rating assigned by Moody's.
Issuers rated Prime-1 (or related supporting institutions) are considered to
have a superior capacity for repayment of short-term promissory obligations.

Description of Fitch Investors Service's commercial paper ratings: F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are regarded as
having the strongest degree of assurance for timely payment.

F-1 Very Strong Credit Quality. Issues assigned this rating reflect an assurance
of timely payment only slightly less in degree than the strongest issue.

Description of Duff & Phelps' commercial paper ratings:
Duff 1+ Highest certainty of timely payment. Short term liquidity, including
internal operating factors and/or access to alternative sources of funds, is
outstanding, and safety is just below risk free U.S. Treasury short term
obligations.

Duff 1 Very high certainty of timely payment. Liquidity factors are excellent
and supported by good fundamental protection factors. Risk factors are minor.

Description of IBCA's Long-Term Ratings:
AAA - Obligations for which there is the lowest expectation of investment risk.
Capacity for timely repayment of principal and interest is substantial. Adverse
changes in business, economic or financial conditions are unlikely to increase
investment risk significantly.

AA - Obligations for which there is a very low expectation of investment risk.
Capacity for timely repayment of principal and interest is substantial. Adverse
changes in business economic or financial conditions may increase investment
risk albeit not very significantly.

A - Obligations for which there is a low expectation of investment risk.
Capacity for timely repayment of principal and interest is strong, although
adverse changes in business, economic or financial conditions may lead to
increased investment risk.

BBB - Capacity for timely repayment of principal and interest is adequate,
although adverse changes in business, economic or financial conditions are more
likely to lead to increased investment risk than for obligations in higher
categories.

BB - Obligations for which there is a possibility of investment risk developing.
Capacity for timely repayment of principal and interest exists, but is
susceptible over time to adverse changes in business, economic or financial
conditions.

B - Obligations for which investment risk exists. Timely repayment of principal
and interest is not sufficiently protected against adverse changes in business,
economic or financial conditions.

CCC - Obligations for which there is a current perceived possibility of default.
Timely repayment of principal and interest is dependent on favourable business,
economic or financial conditions.

CC - Obligations which are highly speculative or which have a high risk of
default.

C - Obligations which are currently in default.

Notes: "+" or "-" may be appended to a rating to denote relative status within
major rating categories.

Ratings of BB and below are assigned where it is considered that speculative
characteristics are present.

Description of IBCA's Short-Term Ratings:
A1+ - Obligations supported by the highest capacity for timely repayment.

A1 - Obligations supported by a strong capacity for timely repayment.

A2 - Obligations supported by a satisfactory capacity for timely repayment,
although such capacity may be susceptible to adverse changes in business,
economic or financial conditions.

A3 - Obligations supported by an adequate capacity for timely repayment. Such
capacity is more susceptible to adverse changes in business, economic or
financial conditions than for obligations in higher categories.

B - Obligations for which the capacity for timely repayment is susceptible to
adverse changes in business, economic or financial conditions.

C - Obligations for which there is an inadequate capacity to ensure timely
repayment.

D - Obligations which have a high risk of default or which are currently in
default.

Description of Thomson Bank Watch Short-Term Ratings:
TBW-1 - The highest category; indicates a very high likelihood that principal
and interest will be paid on a timely basis.

TBW-2 - The second-highest category; while the degree of safety regarding timely
repayment of principal and interest is strong, the relative degree of safety is
not as high as for issues rated "TBW-1".

TBW-3 - The lowest investment-grade category; indicates that while the
obligation is more susceptible to adverse developments (both internal and
external) than those with higher ratings, the capacity to service principal and
interest in a timely fashion is considered adequate.

TBW-4 - The lowest rating category; this rating is regarded as non-investment
grade and therefore speculative.

Description of Thomson BankWatch Long-Term Ratings:

AAA - The highest category; indicates that the ability to repay principal and
interest on a timely basis is extremely high.

AA - The second-highest category; indicates a very strong ability to repay
principal and interest on a timely basis, with limited incremental risk compared
to issues rated in the highest category.

A - The third-highest category; indicates the ability to repay principal and
interest is strong. Issues rated "a" could be more vulnerable to adverse
developments (both internal and external) than obligations with higher ratings.

BBB - The lowest investment-grade category; indicates an acceptable capacity to
repay principal and interest. Issues rated "BBB" are, however, more vulnerable
to adverse developments (both internal and external) than obligations with
higher ratings.

Non-Investment Grade
(Issues regarded as having speculative characteristics in the likelihood of
timely repayment of principal and interest.)

BB - While not investment grade, the "BB" rating suggests that the likelihood of
default is considerably less than for lower-rated issues. However, there are
significant uncertainties that could affect the ability to adequately service
debt obligations.

B - Issues rated "B" show a higher degree of uncertainty and therefore greater
likelihood of default than higher-rated issues. Adverse development could well
negatively affect the payment of interest and principal on a timely basis.

CCC - Issues rated "CCC" clearly have a high likelihood of default, with little
capacity to address further adverse changes in financial circumstances.

CC - "CC" is applied to issues that are subordinate to other obligations rated
"CCC" and are afforded less protection in the event of bankruptcy or
reorganization.

D - Default

These long-term debt ratings can also be applied to local currency debt. In such
cases the ratings defined above will be preceded by the designation "local
currency."

RATINGS IN THE LONG-TERM DEBT CATEGORIES MAY INCLUDE A PLUS (+) OR MINUS (-)
DESIGNATION, WHICH INDICATES WHERE WITHIN THE RESPECTIVE CATEGORY THE ISSUE IS
PLACED.
<PAGE>

INVESTMENT ADVISER OF THE PORTFOLIO AND ADMINISTRATOR
BANKERS TRUST COMPANY

DISTRIBUTOR
SIGNATURE BROKER-DEALER SERVICES, INC.

CUSTODIAN AND TRANSFER AGENT
BANKERS TRUST COMPANY

INDEPENDENT ACCOUNTANTS
COOPERS & LYBRAND L.L.P.

COUNSEL
WILLKIE FARR & GALLAGHER

..............................................................................
No person has been authorized to give any information or to make any
representations other than those contained in the Trust's Prospectuses, its
Statements of Additional Information or the Trust's official sales literature
in connection with the offering of the Trust's shares and, if given or made,
such other information or representations must not be relied on as having been
authorized by the Trust. This Prospectus does not constitute an offer in any
state in which, or to any person to whom, such offer may not lawfully be made.
..............................................................................