Exhibit (17)(b)
Phoenix Investment Partners
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| Prospectus
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| December 16, 1998
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|-------Aberdeen
Phoenix-Aberdeen Worldwide
Opportunities Fund
Phoenix-Aberdeen Worldwide
Opportunities Fund is a mutual fund
that mainly invests in common stocks
of U.S. and foreign companies with
the investment objective of capital
appreciation.
Neither the Securities and Exchange
Commission nor any state securities
commission has approved or
disapproved of these securities or
determined if this prospectus is
truthful or complete. Any representation
to the contrary is a criminal offense.
This Prospectus contains important
information about the Phoenix-Aberdeen
Worldwide Opportunities Fund that you
should know before investing. Please
read it carefully and retain it for future
reference.
[LOGO] PHOENIX
INVESTMENT PARTNERS, LTD.
> Phoenix-
Aberdeen
Worldwide
Opportunities
Fund
Table of Contents
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Investment Risk and Return Summary ............. page 2
Fund Expenses .................................. page 5
Investment Strategies .......................... page 6
Risks Related to Investment Strategies ......... page 8
Management of the Fund ......................... page 12
Pricing of Fund Shares ......................... page 15
Sales Charges .................................. page 16
Your Account ................................... page 19
How to Buy Shares .............................. page 20
How to Sell Shares ............................. page 20
Things You Should Know When
Selling Shares ................................ page 21
Account Policies ............................... page 23
Investor Services .............................. page 24
Tax Status ..................................... page 25
Financial Highlights ........................... page 26
Additional Information ......................... page 27
Investment Risk and Return Summary
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Investment Objective
Phoenix-Aberdeen Worldwide Opportunities Fund has
an investment objective of capital appreciation.
Distributions of investment income, such as
dividends and interest, are incidental in the
selection of investments. There is no guarantee
that the fund will achieve the objective.
Principal Investment Strategies
[arrow] The fund may invest in a diversified
portfolio of equity and fixed income
securities. The fund will invest at least 65%
of its assets in securities of issuers
located in 3 or more countries, one of which
will be the United States.
[arrow] The fund intends to invest at least 65% of
its total assets in common stocks.
[arrow] The fund may invest in other types of equity
securities including preferred stock, other
securities that can be converted into common
stock or preferred stock, and warrants to
purchase common stock or preferred stock.
[arrow] An adviser and subadviser will manage the
fund. The subadviser will determine how much
of the fund's assets will be invested in
different countries and regions. The
subadviser will also decide which investments
to buy and sell in all countries and regions
other than the United States. The adviser
will decide which investments to buy and sell
in the United States.
[arrow] The subadviser uses a value-oriented approach
in selecting investments. The adviser uses a
growth-oriented approach in selecting
investments.
[arrow] Up to 35% of the fund's assets may be
invested in fixed income securities such as
corporate and government notes and bonds. Up
to 5% of the fund's assets can be invested in
high-yield securities ("junk bonds"). The
rest must be invested in investment grade
securities.
[arrow] The fund may invest in small companies as
well as larger companies.
[arrow] The fund may invest in companies in foreign
countries with developed markets and
countries with "emerging markets."
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Principal Risks
If you invest in this fund, you risk that you may
lose your investment.
The fund will seek to increase the value of your
shares by investing in securities the adviser or
subadviser expect to increase in value. Most of
the fund's investments will be in common stocks
and other equity investments. Conditions affecting
the overall economy, specific industries or
companies in which the fund invests can be worse
than expected. As a result, the value of your
shares may decrease. Increases in interest rates
affecting the global economy, particular
industries or specific companies can cause fixed
income investments that the fund may own to
decline in value. This, too, can cause your share
value to decrease.
Unlike many other mutual funds, this fund may make
significant investments in companies in foreign
countries and in foreign governments, including
some "emerging market" countries (those with
markets that are not fully developed). Political
and economic uncertainty as well as relatively
less public information about investments may
negatively impact the fund's portfolio. Some
investments may be made in currencies other than
U.S. dollars that will fluctuate in value as a
result of changes in the currency exchange rate.
Foreign markets and currencies may not perform as
well as U.S. markets. Emerging market countries
and companies doing business in emerging markets
may not have the same range of opportunities as
countries and their companies in developed
nations. They may also have more obstacles to
financial success.
This fund may also invest in small companies as
well as larger companies. Smaller companies,
regardless of their location, may be affected to a
greater extent than larger companies by changes in
general economic conditions and conditions in
particular industries. Smaller companies may also
be relatively new and not have the same operating
history and "track record" as larger companies.
This could make future performance of smaller
companies more difficult to predict.
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Performance Tables
The bar chart below provides an indication of the
risks of investing in the Phoenix-Aberdeen
Worldwide Opportunities Fund by showing changes in
the fund's Class A Shares performance from year to
year over a 10-year period(1). The table below
shows how the fund's Class A Shares average annual
returns for one, five and ten years compare to
those of a broad-based securities market index.
The fund's past performance is not necessarily an
indication of how the fund will perform in the
future.
Worldwide Opportunities Fund
[Tabular representation of bar chart]
Calendar Year
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1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
Annual Return (%) 11.1 9.1 (22.7) 24.5 3.2 37.8 0.0 15.1 15.0 14.1
(1) The fund's average annual returns in the chart above do not
reflect the deduction of any sales charges. The returns would
have been less than those shown if sales charges were deducted.
During the 10-year period shown in the chart above, the highest
return for a quarter was 16.61% (quarter ending March 31, 1991)
and the lowest return for a quarter was -19.72% (quarter ending
September 30, 1990). Year to date performance (through
September 30, 1998) was 10.07%.
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Average Annual Total Returns
(for the periods ending 12/31/97)(1) One Year Five Years Ten Years Life of the Fund(2)
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Class A Shares 8.66% 14.67% 9.07% 8.92%
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Class B Shares 9.43% N/A N/A 11.09%
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Class C Shares(3) N/A N/A N/A N/A
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MSCI World(4) 15.76% 15.34% 10.56% N/A
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(1) The fund's average annual returns in the table above
reflect the deduction of the maximum sales charge for an
investment in the fund's Class A Shares and a full redemption
in the fund's Class B Shares.
(2) Class A Shares since May 13, 1960 and Class B Shares since
July 15, 1994.
(3) Class C Shares will be offered as of the effective date of
this prospectus.
(4) The Morgan Stanley Capital International World (net) Index
(MSCI World) is an unmanaged index calculated as an
arithmetical average weighted by the market value of
approximately 1,600 companies listed on stock exchanges in 23
countries, including the U.S. and Canada. The index does not
reflect any sales charges or fees but does include the effect
of foreign tax withholding.
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Fund Expenses
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This table illustrates all fees and expenses that
you may pay if you buy and hold shares of the
fund.
Class A Class B Class C
Shares Shares Shares(b)
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Shareholder Fees (fees paid directly from
your investment)
Maximum Sales Charge (load) Imposed on
Purchases (as a percentage of offering price) 4.75% None None
Maximum Deferred Sales Charge (load) (as a None 5%(a) 1% during the
percentage of the lesser of the value redeemed or first year
the amount invested)
Maximum Sales Charge (load) Imposed on
Reinvested Dividends None None None
Redemption Fee None None None
Exchange Fee None None None
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Class A Class B Class C
Shares Shares Shares(b)
-------- -------- ---------
Annual Fund Operating Expenses (expenses
that are deducted from fund assets)
Management Fees 0.75% 0.75% 0.75%
Distribution and Service (12b-1) Fees(c) 0.25% 1.00% 1.00%
Other Expenses 0.42% 0.42% 0.42%
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Total Annual Fund Operating Expenses 1.42% 2.17% 2.17%
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(a) The maximum deferred sales charge is imposed on Class B
Shares redeemed during the first year; thereafter, it
decreases 1% annually to 2% during the fourth and fifth years
and to 0% after the fifth year.
(b) Class C Shares will be offered as of the effective date of
this prospectus.
(c) Distribution and Service Fees represent an asset-based
sales charge that, for a long-term shareholder, may be higher
than the maximum front-end sales charge permitted by the
National Association of Securities Dealers, Inc. ("NASD").
Example
This example is intended to help you compare the
cost of investing in the fund with the cost of
investing in other mutual funds.
The example assumes that you invest $10,000 in the
fund for the time periods indicated and then
redeem all of your shares at the end of those
periods. The example also assumes that your
investment has a 5% return each year and that the
fund's operating expenses remain the same. In the
case of Class B Shares, it is assumed that your
shares are converted to Class A after eight years.
Although your actual costs may be higher or lower,
based on these assumptions your costs would be:
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Class 1 year 3 years 5 years 10 years
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Class A $613 $903 $1,214 $2,096
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Class B $620 $879 $1,164 $2,313
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Class C $320 $679 $1,164 $2,503
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You would pay the following expenses if you did
not redeem your shares:
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Class 1 year 3 years 5 years 10 years
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Class A $613 $903 $1,214 $2,096
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Class B $220 $679 $1,164 $2,313
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Class C $220 $679 $1,164 $2,503
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Investment Strategies
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Investment Objective
The fund's investment objective is capital
appreciation. Income distribution (yield) will not
be a factor. There is no guarantee that the fund
will achieve its investment objective.
Principal Investment Strategies
The fund invests in a diversified portfolio of
securities of domestic and non-U.S. issuers,
including companies, governments, governmental
agencies and international organizations. The fund
may invest in any region of the world. Under
normal circumstances, the fund will invest at
least 65% of its total assets in the securities of
issuers located in at least three different
countries, one of which will be the United States.
The fund employs an adviser, Phoenix Investment
Counsel, Inc., to select securities of U.S.
issuers, and a subadviser, Aberdeen Fund Managers,
Inc., to select securities of all other issuers.
Each month the subadviser's investment strategy
committee determines how much (what percentage) of
the fund's assets will be invested in each region
of the world (e.g., continental Europe, United
Kingdom, Asia, etc.). The adviser will invest the
amount allocated for investment in the United
States. The subadviser invests all other amounts.
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The fund will invest at least 65% of its assets in
common stocks. The fund may also invest in other
equity securities including preferred stocks,
securities convertible into common stocks,
warrants and rights to purchase common stock. The
adviser uses a top down/bottom up, growth-oriented
stock selection process. The subadviser uses a
bottom up, value-oriented process that selects
companies that exhibit growth in recurring
earnings, clean balance sheets, strong management,
clear and credible business vision and a history
of fair treatment of minority shareholders. The
fund may invest in securities of issuers of any
size, in countries with developed markets and
countries with emerging markets.
The fund may also invest up to 35% of its assets
in non-convertible fixed-income securities of U.S.
and non-U.S. issuers (described below) when the
adviser or subadviser feels that such securities
are appropriate for the achievement of the fund's
investment objective. Market values of
fixed-income securities typically move in the
opposite direction from changes in interest rates.
Therefore, investing in fixed-income securities
can provide an opportunity for capital
appreciation when interest rates are expected to
decline.
The non-convertible fixed-income securities
referred to above may consist of:
o corporate notes, bonds and debentures of U.S.
issuers that are rated high grade (i.e., rated
within the three highest rating categories by
a nationally recognized statistical rating
organization) or, if unrated, are considered
by the fund's adviser to be of comparable
quality;
o corporate notes, bonds, debentures and other
securities (such as Euro-currency instruments)
of non-U.S. issuers that are rated within the
three highest rating categories of rating
services or, if unrated, are deemed by the
fund's subadviser to be of comparable credit
quality;
o Treasury bills, notes and bonds issued by the
United States Government or related agencies;
and
o securities issued by foreign governments and
supranational agencies (such as the World
Bank).
The fund may invest up to 5% of its net assets in
fixed-income securities rated below investment
grade (commonly referred to as "junk bonds").
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Temporary defensive strategy: if the adviser or
subadviser believes that market conditions are not
favorable to the fund's principal strategies, the
fund may invest without limit in U.S. government
securities and in money market instruments. When
this happens, the fund may not achieve its
investment objective.
Risks Related to Investment Strategies
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General
The fund's focus is capital appreciation. The
adviser and subadviser intend to invest fund
assets so that your shares increase in value.
However, the value of the fund's investments that
support your share value can decrease as well as
increase. If between the time you purchase shares
and the time you sell shares the value of the
fund's investments decreases you will lose money.
The value of the fund's investments can decrease
for a number of reasons. For example, changing
economic conditions may cause a decline in the
value of many or even most equity and fixed income
investments. Particular industries can face poor
markets for their products or services so that
companies engaged in those businesses do not do as
well as companies in other industries. Interest
rate changes may improve prospects for certain
types of businesses and they may worsen prospects
for others. To the extent that the fund's
investments are affected by general economic
declines, declines in industries, and interest
rate changes that negatively affect the companies
in which the fund invests, fund share values may
decline. Share values can also decline if the
specific companies selected for fund investment
fail to perform as the adviser or subadviser
expects, regardless of general economic trends,
industry trends, interest rates and other economic
factors.
In addition to these general risks of investing in
the fund, there are several specific risks of
investing in the fund that you should note.
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Foreign Investing
The fund will invest in non-U.S. companies.
Investing in the securities of non-U.S. companies
involves special risks and considerations not
typically associated with investing in U.S.
companies. These include:
[arrow] differences in accounting, auditing and
financial reporting standards,
[arrow] generally higher commission rates on foreign
portfolio transactions,
[arrow] differences and inefficiencies in transaction
settlement systems,
[arrow] the possibility of expropriation or
confiscatory taxation,
[arrow] adverse changes in investment or exchange
control regulations,
[arrow] political instability, and
[arrow] potential restrictions on the flow of
international capital.
Political and economic uncertainty as well as
relatively less public information about
investments may negatively impact the fund's
portfolio.
Foreign securities often trade with less frequency
and volume than domestic securities and therefore
may exhibit greater price volatility.
Additionally, dividends and interest payable on
foreign securities may be subject to foreign taxes
withheld prior to receipt by the fund.
Many of the foreign securities held by the fund
will not be registered with, nor will the issuers
of those securities be subject to the reporting
requirements of, the U.S. Securities and Exchange
Commission. Accordingly, there may be less
publicly available information about the
securities and about the foreign company or
government issuing them than is available about a
domestic company or government entity. Moreover,
individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such
respects as growth of gross national product, rate
of inflation, capital reinvestment, resource
self-sufficiency and balance of payment positions.
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Foreign Currency
Significant portions of the fund's assets may be
invested in securities denominated in foreign
currencies. Changes in foreign exchange rates will
affect the value of those securities denominated
or quoted in currencies other than the U.S.
dollar. The forces of supply and demand in the
foreign exchange markets determine exchange rates
and these forces are in turn affected by a range
of economic, political, financial, governmental
and other factors. Exchange rate fluctuations can
affect the fund's net asset value (share price)
and dividends either positively or negatively
depending upon whether foreign currencies are
appreciating or depreciating in value relative to
the U.S. dollar. Exchange rates fluctuate over
both the short and long terms.
Effective January 1, 1999, eleven European
countries will begin converting from their
sovereign currency to the European Union common
currency called the "Euro." This conversion may
expose the fund to certain risks including the
reliability and timely reporting of pricing
information of the fund's portfolio holdings. In
addition, one or more of the following may
adversely affect specific securities in the fund's
portfolio:
[arrow] known trends or uncertainties related to the
Euro conversion that an issuer reasonably
expects will have a material impact on
revenues, expenses or income from its
operations;
[arrow] competitive implications of increased price
transparency of European Union markets
(including labor markets) resulting from
adoption of a common currency and issuers'
plans for pricing their own products and
services in the Euro;
[arrow] issuers' ability to make required information
technology updates on a timely basis, and
costs associated with the conversion
(including costs of dual currency operations
through January 1, 2002);
[arrow] currency exchange rate risk and derivatives
exposure (including the disappearance of
price sources, such as certain interest rate
indices); and
[arrow] potential tax consequences.
The subadviser does not expect to invest in any
securities that may be adversely affected by the
conversion to the Euro.
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Emerging Market Investing
The fund may invest in companies located in
emerging market countries and regions. Investment
in less-developed countries whose markets are
still emerging generally presents risks in greater
degree than those presented by investment in
foreign issuers based in countries with developed
securities markets and more advanced regulatory
systems. Prior governmental approval of foreign
investments may be required under certain
circumstances in some developing countries, and
the extent of foreign investment in domestic
companies may be subject to limitation in other
developing countries. The charters of individual
companies in developing countries may impose
limitations on foreign ownership to prevent, among
other concerns, violation of foreign investment
limitations.
The economies of developing countries generally
are heavily dependent upon international trade
and, accordingly, have been and may continue to be
adversely affected by trade barriers, exchange
controls, managed adjustments in relative currency
values and other protectionist measures imposed or
negotiated by the countries with which they trade.
These economies also have been (and may continue
to be) adversely affected by economic conditions
in the countries with which they trade.
Small Market Capitalization Investing
The fund may invest in large and small companies
throughout the world. Companies with small
capitalization are often companies with a limited
operating history or companies in industries which
have recently emerged due to cultural, economic,
regulatory or technological developments. Such
developments can have a significant positive or
negative effect on small capitalization companies
and their stock performance. Given the limited
operating history and rapidly changing fundamental
prospects, investment returns from smaller
capitalization companies can be highly volatile.
Smaller companies may find their ability to raise
capital impaired by their size or lack of
operating history. Product lines are often less
diversified and subject to competitive threats.
Smaller capitalization stocks are subject to
varying patterns of trading volume and may, at
times, be difficult to sell.
Mutual Fund Investing
The fund may invest in other mutual funds to take
advantage of investment opportunities in certain
countries where the fund otherwise would not be
able to invest or where the size of a fund
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investment in any particular country would be too
small. The fund may invest up to 10% of its assets
in the shares of other mutual funds, however the
fund will not invest more than 5% of its assets in
any one mutual fund. When the fund purchases
shares of another mutual fund the assets invested
in the other mutual fund incur a layering of
expenses including operating costs, advisory fees,
and administrative fees that you indirectly bear.
Impact of the Year 2000 Issue on Fund Investments
The Year 2000 issue is the result of computer
programs being written using two rather than four
digits to define the applicable year. There is the
possibility that some or all of a company's
computer programs that have date-sensitive
software may recognize a date using "00" as the
year 1900 rather than the year 2000. If a company
whose securities are held by the fund does not
"fix" its Year 2000 issue, it is possible that its
operations and financial results would be hurt.
Also, the cost of modifying computer programs to
become Year 2000 compliant may hurt the financial
performance and market price of companies whose
securities are held by the fund.
Management of the Fund
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The Advisers
Phoenix Investment Counsel, Inc. ("Phoenix") is
the investment adviser to the fund and is located
at 56 Prospect Street, Hartford, CT 06115. Phoenix
also acts as the investment adviser for 14 other
mutual funds, as subadviser to three additional
mutual funds and as adviser to institutional
clients. As of September 30, 1998, Phoenix had
$21.3 billion in assets under management. Phoenix
has acted as an investment adviser for over sixty
years.
Aberdeen Fund Managers Inc. ("Aberdeen") is the
subadviser to the fund and is located at 1
Financial Plaza, Suite 2210, Fort Lauderdale, FL
33394. Aberdeen is a wholly-owned subsidiary of
Aberdeen Asset Management PLC based in Aberdeen,
Scotland. Together with its subsidiaries, Aberdeen
Asset Management PLC provides investment
management services to unit and investment trusts,
segregated pension funds and other institutional
and private portfolios, and through Aberdeen, U.S.
mutual funds. Aberdeen has served as subadviser
for the following mutual funds since their
inception in 1996: Phoenix-Aberdeen New Asia Fund,
Phoenix-
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Aberdeen Global Small Cap Fund and the Aberdeen
New Asia Series of The Phoenix Edge Series Fund.
As of September 30, 1998, Aberdeen Asset
Management PLC had $22.3 billion in assets under
management.
Subject to the direction of the fund's Board of
Trustees, Phoenix is responsible for managing the
fund's investment program and the day-to-day
management of the domestic portion of the fund's
portfolio. Aberdeen, as subadviser, is responsible
for the day-to-day management of the foreign
holdings of the fund. Both Phoenix and Aberdeen
manage the fund's assets to conform with the
investment policies as described in this
prospectus. The fund pays Phoenix a monthly
investment management fee that is accrued daily
against the value of the fund's net assets at the
following rates.
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1st billion $1+ billion through $2 billion $2+ billion
- -------------------------------------------------------------------------------------------
Management Fee 0.75% 0.70% 0.65%
- -------------------------------------------------------------------------------------------
Phoenix pays Aberdeen a fee for that portion of
the fund's net assets that are invested in
non-U.S. securities as follows.
- --------------------------------------------------------------------------------------------
1st billion $1+ billion through $2 billion $2+ billion
- --------------------------------------------------------------------------------------------
Subadvisory Fee 0.375% 0.35% 0.325%
- --------------------------------------------------------------------------------------------
During the fund's last fiscal year, the fund paid
total management fees of $1,278,505. The ratio of
management fees to average net assets for the
fiscal year ended June 30, 1998 was 0.75%. The
total advisory fee of 0.75% of the aggregate net
assets of the fund is greater than that for most
mutual funds; however, the Trustees have
determined that it is comparable to fees charged
by other mutual funds whose investment objectives
are similar to those of the fund. On June 1, 1998,
National Securities & Research Corporation
("National") assigned its investment management
agreement to Phoenix Investment Counsel, Inc.
Phoenix and National are subsidiaries of Phoenix
Investment Partners, Ltd. (formerly Phoenix Duff &
Phelps Corporation). Of the total management fees
paid by the fund during the last fiscal year,
National was paid $1,161,194 and Phoenix was paid
$117,311.
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Portfolio Management
Aberdeen's senior strategy committee determines
and monitors the fund's regional allocations
across the globe on a monthly basis. An Aberdeen
team of investment professionals located in
offices spread around the world selects securities
for the foreign portion of the fund's portfolio.
At the same time, a Phoenix team of investment
professionals manages the U.S. portion of the
fund's portfolio.
Impact of the Year 2000 Issue on Fund Operations
The Trustees have directed management to ensure
that the systems used by service providers
(Phoenix and its affiliates) in support of the
fund's operations be assessed and brought into
Year 2000 compliance. Based upon preliminary
assessments, Phoenix has determined that it will
be required to modify or replace portions of its
software so that its computer systems will
properly utilize dates beyond December 31, 1999.
Phoenix management believes that the majority of
these systems are already Year 2000 compliant.
Phoenix believes that with modifications to
existing software and conversions to new software,
the Year 2000 issue will be mitigated. It is
anticipated that such modifications and
conversions will be completed on a timely basis.
It is not known at this time if there could be a
material impact on the operations of Phoenix or
its affiliates or the fund if such modifications
and conversions are not timely completed.
Phoenix will utilize both internal and external
resources to reprogram, or replace, and test the
software for Year 2000 modifications. Certain
systems are already in the process of being
converted due to previous initiatives and it is
expected that all core systems will be remediated
by December 31, 1998 and tested by June 1999. The
total cost to become Year 2000 compliant is not an
expense of the fund and is not expected to have a
material impact on the operating results of
Phoenix.
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Pricing of Fund Shares
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How is the Share Price determined?
The fund calculates a share price for each class
of its shares. The share price is based on the net
assets of the fund and the number of outstanding
shares. In general, the fund calculates net asset
value by:
[arrow] adding the values of all securities and other
assets of the fund,
[arrow] subtracting liabilities, and
[arrow] dividing by the total number of outstanding
shares of the fund.
Asset Value: The fund's investments are valued at
market value. If market quotations are not
available, the fund determines a "fair value" for
an investment according to rules and procedures
approved by the Trustees. Foreign and domestic
debt securities (other than short-term
investments) are valued on the basis of broker
quotations or valuations provided by a pricing
service approved by the Trustees when such prices
are believed to reflect the fair value of such
securities. Foreign and domestic equity securities
are valued at the last sale price or, if there has
been no sale that day, at the last bid price,
generally. Short-term investments having a
remaining maturity of sixty days or less are
valued at amortized cost, which the Trustees have
determined approximates market value.
Liabilities: Class specific expenses, distribution
fees, service fees and other liabilities are
deducted from the assets of each class. Expenses
and liabilities that are not class specific (such
as management fees) are allocated to each class in
proportion to each class's net assets except where
an alternative allocation can be more fairly made.
Net Asset Value: The liability allocated to a
class plus any other expenses are deducted from
the proportionate interest of such class in the
assets of the fund. The resulting amount for each
class is then divided by the number of shares
outstanding of that class to produce each class's
net asset value per share.
The net asset value per share of each class of the
fund is determined on days when the New York Stock
Exchange (the "NYSE") is open for trading as of
the close of trading (normally
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4:00 PM eastern time). The fund will not calculate
its net asset values per share on days when the
NYSE is closed for trading. Trading of securities
held by the fund in foreign markets may negatively
or positively impact the value of such securities
on days when the fund neither trades securities
nor calculates its net asset values (i.e.,
weekends and certain holidays).
At what price are shares purchased?
All investments received by the fund's authorized
agents prior to the close of regular trading on
the NYSE (normally 4:00 PM eastern time) will be
executed based on that day's net asset value.
Shares credited to your account from the
reinvestment of fund distributions will be in full
and fractional shares that are purchased at the
closing net asset value on the next business day
on which the fund's net asset value is calculated
following the dividend record date.
Sales Charges
- ------------------------------------------
What are the classes and how do they differ?
The fund presently offers three classes of shares
that have different sales and distribution charges
(see "Fund Expenses" previously in this
prospectus). The fund has adopted distribution and
service plans allowed under Rule 12b-1 of the
Investment Company Act of 1940 that authorize the
fund to pay distribution and service fees for the
sale of its shares and for services provided to
shareholders. The distribution and service fees
represent an asset-based sales charge that, for a
long-term shareholder, may be higher than the
maximum front-end sales charge permitted by the
National Association of Securities Dealers, Inc.
("NASD").
What arrangement is best for you?
The different classes permit you to choose the
method of purchasing shares that is most
beneficial to you. In choosing a class, consider
the amount of your investment, the length of time
you expect to hold the shares, whether you decide
to receive distributions in cash or to reinvest
them in additional shares, and any other personal
circumstances. Depending upon these
considerations, the accumulated distribution and
service fees and contingent deferred sales charges
of one class may be more or less than the initial
sales charge and accumulated distribution and
service fees of another class of shares bought at
the same time.
| 16
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Because distribution and service fees are paid out
of the fund's assets on an ongoing basis, over
time these fees will increase the cost of your
investment and may cost you more than paying other
types of sales charges.
Class A Shares. If you purchase Class A Shares,
you will pay a sales charge at the time of
purchase equal to 4.75% of the offering price
(4.99% of the amount invested). The sales charge
may be reduced or waived under certain conditions.
Class A Shares are not subject to any charges by
the fund when redeemed. Class A Shares have lower
distribution and service fees (0.25%) and pay
higher dividends than any other class.
Class B Shares. If you purchase Class B Shares,
you will not pay a sales charge at the time of
purchase. If you sell your Class B Shares within
the first 5 years after they are purchased, you
will pay a sales charge of up to 5% of your
shares' value. See "Deferred Sales Charge
Alternative--Class B and C Shares" below. This
charge declines to 0% over a period of 5 years and
may be waived under certain conditions. Class B
shares have higher distribution and service fees
(1.00%) and pay lower dividends than Class A
Shares. Class B Shares automatically convert to
Class A Shares eight years after purchase.
Purchases of Class B Shares may be inappropriate
for any investor who may qualify for reduced sales
charges of Class A Shares and anyone who is over
85 years of age. The underwriter may decline
purchases in such situations.
Class C Shares. If you purchase Class C Shares,
you will not pay a sales charge at the time of
purchase. If you sell your Class C Shares within
the first year after they are purchased, you will
pay a sales charge of 1%. See "Deferred Sales
Charge Alternative--Class B and C Shares" below.
Class C Shares have the same distribution and
service fees (1.00%) and pay comparable dividends
as Class B Shares. Class C Shares do not convert
to any other class of shares of the fund.
Initial Sales Charge Alternative--Class A Shares
The public offering price of Class A Shares is the
net asset value plus a sales charge that varies
depending on the size of your purchase (see "Class
A Shares--Reduced Sales Charges: Combination
Purchase Privilege" in the Statement of Additional
Information). Shares purchased based on the
automatic reinvestment of income dividends or
capital gains distributions are not subject to any
sales charges. The sales charge is divided between
your investment dealer and the fund's underwriter
(Phoenix Equity Planning Corporation or "PEPCO").
17 |
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Sales Charge you may pay to purchase Class A
Shares
Sales Charge as
a percentage of
------------------------------
Amount of Net
Transaction Offering Amount
at Offering Price Price Invested
------------------------------------------------------------
Under $50,000 4.75% 4.99%
$50,000 but under $100,000 4.50 4.71
$100,000 but under $250,000 3.50 3.63
$250,000 but under $500,000 3.00 3.09
$500,000 but under $1,000,000 2.00 2.04
$1,000,000 or more None None
Deferred Sales Charge Alternative--
Class B and C Shares
Class B and C Shares are purchased without an
initial sales charge; however, shares sold within
a specified time period are subject to a declining
contingent deferred sales charge ("CDSC") at the
rates listed below. The sales charge will be
multiplied by the then current market value or the
initial cost of the shares being redeemed,
whichever is less. No sales charge will be imposed
on increases in net asset value or on shares
purchased through the reinvestment of income
dividends or capital gains distributions. To
minimize the sales charge, shares not subject to
any charge will be redeemed first, followed by
shares held the longest time. To calculate the
amount of shares owned and time period held, all
Class B Shares purchased in any month are
considered purchased on the last day of the
preceding month, and all Class C Shares are
considered purchased on the trade date.
Deferred Sales charge you may pay to sell Class B
Shares
Year 1 2 3 4 5 6+
--------------------------------------------------
CDSC 5% 4% 3% 2% 2% 0%
Deferred Sales charge you may pay to sell Class C
Shares
Year 1 2+
--------------------------------------------------
CDSC 1% 0%
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Your Account
- -----------------------------------------
Opening an Account
Your financial advisor can assist you with your
initial purchase as well as all phases of your
investment program. If you are opening an account
by yourself, please follow the instructions
outlined below.
Step 1.
Your first choice will be the initial amount you
intend to invest.
Minimum initial investments:
[arrow] $25 for individual retirement accounts, or
accounts that use the systematic exchange
privilege, or accounts that use the
Investo-Matic program (see below for more
information on the Investo-Matic program).
[arrow] There is no initial dollar requirement for
defined contribution plans, profit-sharing
plans, or employee benefit plans. There is
also no minimum for reinvesting dividends and
capital gains into another account.
[arrow] $500 for all other accounts.
Minimum additional investments:
[arrow] $25 for any account.
[arrow] There is no minimum for defined contribution
plans, profit-sharing plans, or employee
benefit plans. There is also no minimum for
reinvesting dividends and capital gains into
an existing account.
Step 2.
Your second choice will be what class of shares to
buy. The fund offers three classes of shares for
individual investors. Each has different sales and
distribution charges. Because all future
investments in your account will be made in the
share class you choose when you open your account,
you should make your decision carefully. Your
financial advisor can help you pick the share
class that makes the most sense for your
situation.
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Step 3.
Your next choice will be how you want to receive
any dividends and capital gain distributions. Your
options are:
[arrow] Receive both dividends and capital gain
distributions in additional shares
[arrow] Receive dividends in cash and capital gain
distributions in additional shares
[arrow] Receive both dividends and capital gain
distributions in cash
No interest will be paid on uncashed distribution
checks.
How To Buy Shares
- -------------------------------------------------
- ------------------------------------------------------------------------------------------------
To Open An Account
- ------------------------------------------------------------------------------------------------
Through a financial advisor Contact your advisor. Some advisors may charge a fee.
- ------------------------------------------------------------------------------------------------
Complete a New Account Application and send it with a check
Through the mail payable to the fund. Mail them to: State Street Bank, P.O. Box
8301, Boston, MA 02266-8301.
- ------------------------------------------------------------------------------------------------
By Federal Funds wire Call us at 1-800-243-1574 (press 1, then 0).
- ------------------------------------------------------------------------------------------------
Complete the appropriate section on the application and send it
By Investo-Matic with your initial investment payable to the fund. Mail them to:
State Street Bank, P.O. Box 8301, Boston, MA 02266-8301.
- ------------------------------------------------------------------------------------------------
By telephone exchange Call us at 1-800-243-1574 (press 1, then 0).
- ------------------------------------------------------------------------------------------------
How to Sell Shares
- -----------------------------------------------
You have the right to have the fund buy back
shares at the net asset value next determined
after receipt of a redemption order by the fund's
Transfer Agent or an authorized agent. In the case
of a Class B or C Share redemption, you will be
subject to the applicable deferred sales charge,
if any, for such shares. Subject to certain
restrictions, shares may be redeemed by telephone
or in writing. In
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addition, shares may be sold through securities
dealers, brokers or agents who may charge
customary commissions or fees for their services.
The fund does not charge any redemption fees.
Payment for shares redeemed is made within seven
days; however, redemption proceeds will not be
disbursed until each check used for purchases of
shares has been cleared for payment by your bank,
which may take up to 15 days after receipt of the
check.
- --------------------------------------------------------------------------------------------------
Through a financial advisor Contact your advisor. Some advisors may charge a fee.
- --------------------------------------------------------------------------------------------------
Send a letter of instruction and any share certificates (if you
hold certificate shares) to: State Street Bank, P.O. Box 8301,
Through the mail Boston, MA 02266-8301. Be sure to include the registered
owner's name, fund and account number, number of shares
or dollar value you wish to sell.
- --------------------------------------------------------------------------------------------------
For sales up to $50,000, requests can be made by calling
By telephone 1-800-243-1574.
- --------------------------------------------------------------------------------------------------
By telephone exchange Call us at 1-800-243-1574 (press 1, then 0).
- --------------------------------------------------------------------------------------------------
Things You Should Know When Selling Shares
- -----------------------------------------------------------------------
You may realize a taxable gain or loss (for
federal income tax purposes) if you redeem shares
of the fund. The fund reserves the right to pay
large redemptions "in-kind" (in securities owned
by the fund rather than in cash). Large
redemptions are those over $250,000 or 1% of the
fund's net assets. Additional documentation will
be required for redemptions by organizations,
fiduciaries, or retirement plans, or if redemption
is requested by anyone but the shareholder(s) of
record. Transfers between broker-dealer "street"
accounts are governed by the accepting
broker-dealer. Questions regarding this type of
transfer should be directed to your financial
advisor. Redemption requests will not be honored
until all required documents in proper form have
been received. To avoid delay in redemption or
transfer, shareholders having questions about
specific requirements should contact the fund's
Transfer Agent at (800) 243-1574.
Redemptions by Mail
[arrow] Send a clear letter of instructions if all of
these apply:
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o Your shares are registered individually,
jointly, or as custodian under the Uniform
Gifts to Minors Act or Uniform Transfers to
Minors Act.
o The proceeds do not exceed $50,000.
o The proceeds are payable to the registered
owner at the address on record.
[arrow] Send a clear letter of instructions with a
signature guarantee when any of these apply:
o You are selling more than $50,000 worth of
shares.
o The name or address on the account has changed
within the last 60 days.
o You want the proceeds to go to a different
name or address than on the account.
If you are selling shares held in a corporate or
fiduciary account, please contact the fund's
Transfer Agent at (800) 243-1574.
The signature on your request must be guaranteed
by an eligible guarantor institution as defined by
the fund's Transfer Agent in accordance with its
signature guarantee procedures. Currently, such
procedures generally permit guarantees by banks,
broker dealers, credit unions, national securities
exchanges, registered securities associations,
clearing agencies and savings associations.
Selling Shares by Telephone
The Transfer Agent will use reasonable procedures
to confirm that telephone instructions are
genuine. Address and bank account information are
verified, redemption instructions are taped, and
all redemptions are confirmed in writing.
The individual investor bears the risk from
instructions given by an unauthorized third party
that the Transfer Agent reasonably believed to be
genuine.
The Transfer Agent may modify or terminate the
telephone redemption privilege at any time with 60
days notice to shareholders.
During times of drastic economic or market
changes, telephone redemptions may be difficult to
make or temporarily suspended.
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Account Policies
- ---------------------------------------------
Account Reinstatement Privilege
For 180 days after you sell your Class A, B, or C
Shares, you can purchase Class A Shares of any
fund at net asset value, with no sales charge, by
reinvesting all or part of your proceeds, but not
more. Send your written request to State Street
Bank, P.O. Box 8301, Boston, MA 02266-8301. You
can call us at 1-800-243-1574 for more
information.
Please remember, a redemption and reinvestment are
considered to be a sale and purchase for
tax-reporting purposes. Class B shareholders who
have had the contingent deferred sales charge
waived because they are in the Systematic
Withdrawal Program are not eligible for this
reinstatement privilege.
Redemption of Small Accounts
Due to the high cost of maintaining small
accounts, if your account balance is less than
$200, you may receive a notice requesting you to
bring the balance up to $200 within 60 days. If
you do not, the shares in the account will be sold
at net asset value, and a check will be mailed to
the address of record.
Exchange Privileges
You should read the prospectus carefully before
deciding to make an exchange. You can obtain a
prospectus from your financial advisor or by
calling us at 1-800-243-4361 or accessing our Web
site at www.phoenixinvestments.com.
o You may exchange shares for another fund in
the same class of shares; e.g., Class A for
Class A.
o Exchanges may be made by phone
(1-800-243-1574) or by mail (State Street
Bank, P.O. Box 8301, Boston, MA 02266-8301).
o The amount of the exchange must be equal to
the minimum initial investment required.
o The exchange of shares is treated as a sale
and purchase for federal income tax purposes.
o Because excessive trading can hurt fund
performance and harm other shareholders, the
fund reserves the right to temporarily or
permanently end exchange privileges or reject
an order from
23 |
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anyone who appears to be attempting to time
the market, including investors who request
more than one exchange in any 30-day period.
The fund's underwriter has entered into
agreements with certain market timing firms
permitting them to exchange by telephone.
These privileges are limited, and the fund
distributor has the right to reject or suspend
them.
Retirement Plans
Shares of the fund may be used as investments
under the following qualified prototype retirement
plans: traditional IRA, rollover IRA, SIMPLE IRA,
Roth IRA, 401(k) plans, profit-sharing, money
purchase plans, and 403(b) plans. For more
information, call 1-800-243-4361.
Investor Services
- ----------------------------------------------
Investo-Matic is a systematic investment plan that
allows you to have a specified amount
automatically deducted from your checking or
savings account and then deposited into your
mutual fund account. Just complete the
Investo-Matic Section on the application and
include a voided check.
Systematic Exchange allows you to automatically
move money from one Phoenix Fund to another on a
monthly, quarterly, semi-annual or annual basis.
Shares of one Phoenix Fund will be exchanged for
shares of the same class of another fund at the
interval you select. To sign up, just complete the
Systematic Exchange Section on the application.
Telephone Exchange lets you exchange shares of one
fund for the same class of shares in another fund,
using our customer service telephone service. See
the Telephone Exchange Section on the application.
Systematic Withdrawal Program allows you to
periodically redeem a portion of your account on a
predetermined monthly, quarterly, semiannual, or
annual basis. Sufficient shares will be redeemed
on the 15th of the month at the closing net asset
value so that the payment is made about the 20th
of the month. The program also provides for
redemptions on or about the 10th, 15th, or 25th
with proceeds directed through Automated Clearing
House (ACH) to your bank. The minimum withdrawal
is $25.00, and minimum account balance
requirements continue. Shareholders in the program
must own fund shares worth at least $5,000.
| 24
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Tax Status
- ---------------------------------------
The fund intends to continue to qualify annually
as a regulated investment company (mutual fund)
under Subchapter M of the Internal Revenue Code.
The fund also intends to annually distribute to
shareholders all of its net investment income and
net realized capital gains, after utilization of
any capital loss carryovers. If the fund continues
to qualify, it generally will not be subject to
federal income tax on the income it distributes.
The discussion below is based on the assumption
that the fund will continue to qualify as a
regulated investment company.
The fund will be subject to a nondeductible 4%
excise tax if it fails to meet certain annual
distribution requirements. In order to prevent
imposition of the excise tax, it may be necessary
for the fund to make distributions more frequently
than described in the previous paragraph.
Dividends and Distributions
The fund plans to make distributions from net
investment income semiannually, and to distribute
net realized capital gains, if any, at least
annually. Distributions of short-term capital
gains and net investment income are taxable to
shareholders as ordinary income. Long-term capital
gains, if any, distributed to shareholders and
which are designated by the fund as capital gain
distributions, are taxable to shareholders as
long-term capital gain distributions regardless of
the length of time you have owned your shares.
Unless you elect to receive distributions in cash,
dividends and capital gain distributions are paid
in additional shares. All distributions, cash or
additional shares, are subject to federal income
tax and may be subject to state, local and other
taxes.
Backup Withholding
By law, 31% of fund distributions and any
redemption proceeds must be withheld if you have
not provided complete, correct taxpayer
identification number and certain required
certifications. The fund reserves the right to
refuse to open an account for any person failing
to provide the necessary taxpayer information.
25 |
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Financial Highlights
- -------------------------------------------------
This table is intended to help you understand the
fund's financial performance for the past five
years. Class C Shares are a new class of shares
and as such have no financial performance to
report as of the effective date of this
prospectus. Certain information reflects financial
results for a single fund share. The total returns
in the table represent the rate that an investor
would have earned on an investment in the fund
(assuming reinvestment of all dividends and
distributions). This information has been audited
by PricewaterhouseCoopers LLP, independent
accountants. Their report, together with the
fund's financial statements, are included in the
fund's most recent Annual Report, which is
available upon request.
Class A
----------------------------------------------------------------------------
Year Ended June 30,
----------------------------------------------------------------------------
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Net asset value,
beginning of period $ 10.75 $ 10.29 $ 9.04 $ 10.17 $ 8.00
Income from investment
operations:(5)
Net investment income (loss) 0.02 0.03(1) (0.02)(1) 0.01(1) 0.01
Net realized and unrealized gains 2.97 1.25 1.87 0.56 2.19
--------- ---------- --------- --------- --------
Total from investment operations 2.99 1.28 1.85 0.57 2.20
--------- ---------- --------- --------- --------
Less distributions:
Dividends from net investment
income (0.13) (0.04) -- -- (0.03)
Distributions from net realized gains (1.20) (0.78) (0.60) ( 1.37) --
In excess of net investment income (0.01) -- -- -- --
In excess of net realized gains -- -- -- ( 0.33) --
--------- ---------- --------- --------- --------
Total distributions (1.34) (0.82) (0.60) ( 1.70) (0.03)
--------- ---------- --------- --------- --------
Change in net asset value 1.65 0.46 1.25 ( 1.13) 2.17
--------- ---------- --------- --------- --------
Net asset value, end of period $ 12.40 $ 10.75 $ 10.29 $ 9.04 $ 10.17
========= ========== ========= ========= ========
Total return(2) 31.45% 13.40% 21.39% 6.53% 27.46%
Ratios/supplemental data:
Net assets, end of period (thousands) $ 183,188 $ 153,005 $ 146,052 $ 126,481 $118,707
Ratio to average net assets of:
Operating expenses 1.42% 1.53% 1.60% 1.80% 1.50%
Net investment income (loss) 0.21% 0.34% (0.19)% 0.16% 0.09%
Portfolio turnover 156% 234% 245% 277% 259%
Class B
-----------------------------------------------------------------
From
Inception
Year Ended June 30, 7/15/94
--------------------------------------------- to
1998 1997 1996 6/30/95
---- ---- ---- -----------
Net asset value,
beginning of period $ 10.53 $ 10.14 $ 8.98 $ 10.40
Income from investment
operations:(5)
Net investment income (loss) (0.06) (0.03)(1) (0.08)(1) (0.02)(1)
Net realized and unrealized gains 2.90 1.21 1.84 0.30
--------- --------- --------- -----------
Total from investment operations 2.84 1.18 1.76 0.28
--------- --------- --------- -----------
Less distributions:
Dividends from net investment
income (0.11) (0.01) -- --
Distributions from net realized gains (1.20) (0.78) (0.60) (1.37)
In excess of net investment income (0.02) -- -- --
In excess of net realized gains -- -- -- (0.33)
--------- --------- --------- -----------
Total distributions (1.33) (0.79) (0.60) (1.70)
--------- --------- --------- -----------
Change in net asset value 1.51 0.39 1.16 (1.42)
--------- --------- --------- -----------
Net asset value, end of period $ 12.04 $ 10.53 $ 10.14 $ 8.98
========= ========= ========= ===========
Total return(2) 30.61% 12.46% 20.50% 3.54%(3)
Ratios/supplemental data:
Net assets, end of period (thousands) $ 10,855 $ 8,412 $ 5,709 $ 2,849
Ratio to average net assets of:
Operating expenses 2.17% 2.29% 2.34% 2.61%(4)
Net investment income (loss) (0.54)% (0.35)% (0.86)% (0.33)%(4)
Portfolio turnover 156% 234% 245% 277%
------------------
(1) Computed using average shares outstanding.
(2) Sales charges are not reflected in the total return
calculation.
(3) Not annualized.
(4) Annualized.
(5) Distributions are made in accordance with the prospectus;
however, class level income per share from investment
operations may vary from anticipated results depending on
the timing of share purchases and redemptions.
| 26
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Additional Information
- ---------------------------------------------------
Statement of Additional Information
The fund has filed a Statement of Additional Information about the fund,
dated December 16, 1998 with the Securities and Exchange Commission. The
Statement contains more detailed information about the fund. It is
incorporated into this prospectus by reference and is legally part of the
prospectus. You may obtain a free copy of the Statement:
[arrow] by writing to Phoenix Equity Planning Corporation, 100 Bright Meadow
Blvd., P.O. Box 2200, Enfield, Connecticut 06083-2200 or
[arrow] by calling (800) 243-4361.
You may also obtain information about the fund from the Securities and
Exchange Commission:
[arrow] through its internet site (http://www.sec.gov),
[arrow] by visiting its Public Reference Room in Washington, DC or
[arrow] by writing to its Public Reference Section, Washington, DC 20549-6009
(a fee may be charged).
Information about the operation of the Public Reference Room may be
obtained by calling (800) SEC-0330.
Shareholder Reports
The fund semiannually mails to its shareholders detailed reports
containing information about the fund's investments. The fund's Annual
Report contains a detailed discussion of the market conditions and
investment strategies that significantly affected the fund's performance
from July 1 through June 30. You may request a free copy of the fund's
Annual and Semiannual Reports:
[arrow] by writing to Phoenix Equity Planning Corporation, 100 Bright Meadow
Blvd., P.O. Box 2200, Enfield, Connecticut 06083-2200 or
[arrow} by calling (800) 243-4361.
Customer Service: (800) 243-1574
Marketing: (800) 243-4361
Telephone Orders: (800) 367-5877
Telecommunication Device (TTY): (800) 243-1926
SEC File Nos. 2-16590 & 811-945
[LOGO] Printed on recycled paper using soybean ink
27 |
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Phoenix Equity Planning Corporation Bulk Rate Mail
PO Box 2200 US Postage
Enfield CT 06083-2200 PAID
Springfield, MA
Permit No. 444