<PAGE>

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PROSPECTUS

Smith Barney Global Biotechnology Fund
Smith Barney Global Media & Telecommunications Fund
Smith Barney Global Technology Fund

Class A, B, L and Y Shares

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

February 28, 2001


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  INVESTMENT PRODUCTS: NOT  FDIC  INSURED . NO  BANK  GUARANTEE . MAY  LOSE
                                     VALUE
---------------------------------------------------------

Each fund is a separate series of Smith Barney Sector Series Inc., a Maryland
corporation.

The Securities and Exchange Commission has not approved or disapproved these
securities or determined whether this prospectus is accurate or complete. Any
statement to the contrary is a crime.

<PAGE>




  Contents



                                                       Smith Barney Mutual Funds

                                                                               1

<TABLE>
<CAPTION>
         <C>                                                       <C>
         Investments, risks and performance.......................  2

            Smith Barney Global Biotechnology Fund................  2

            Smith Barney Global Media & Telecommunications Fund...  6

            Smith Barney Global Technology Fund................... 11

         More on the funds' investments........................... 15

         Management............................................... 16

         Choosing a class of shares to buy........................ 18

         Comparing the funds' classes............................. 19

         Sales charges............................................ 20

         More about deferred sales charges........................ 23

         Buying shares............................................ 24

         Exchanging shares........................................ 25

         Redeeming shares......................................... 26

         Other things to know about share transactions............ 28

         Dividends, distributions and taxes....................... 29

         Share price.............................................. 31

         Financial Highlights..................................... 32

            Smith Barney Global Biotechnology Fund................ 32

            Smith Barney Global Media & Telecommunications Fund... 35

            Smith Barney Global Technology Fund................... 38
</TABLE>

Each fund is a separate series of Smith Barney Sector Series Inc., a Maryland
corporation.
<PAGE>

  Investments, risks and performance

Smith Barney Global Biotechnology Fund

Investment objective

Smith Barney Global Biotechnology Fund (the "Global Biotechnology Fund") seeks
long-term capital appreciation.

Principal investment strategies

Key investments The Global Biotechnology Fund normally invests at least 80% of
its assets in securities of companies principally engaged in, but not limited
to, the research, development, application, manufacture and distribution of
various biotechnological and biomedical products, services, processes and
related technologies.

The Global Biotechnology Fund may invest without limitation in securities of
foreign issuers and will invest in securities of issuers located in at least
three countries, including the U.S. The fund invests primarily in companies
with medium and large market capitalizations. To a lesser extent, the fund also
may invest in equity securities of companies with small market capitalizations.
Medium and large market capitalization companies are those companies with
market capitalizations exceeding $5 billion.

Selection process The Global Biotechnology Fund normally invests at least 80%
of its assets in companies doing business in the biotechnology sector. The
remainder of the fund's assets are not required to be invested in that sector.
To determine whether a company is principally doing business in the sector, it
must meet at least one of the following tests:

[_] At least 50% of its gross income or its net sales must come from activities
    in the sector;
[_] At least 50% of its assets must be devoted to producing revenues from the
    sector; or
[_] Based on other available information, the manager determines that the
    company's primary business is within the sector.

In buying and selling securities, the Global Biotechnology Fund relies on
fundamental analysis of each issuer and its potential for success in light of
its current financial condition and its industry position. Factors considered
include, among other things, long-term growth potential, earnings estimates and
quality of management. The fund may lend its securities to earn income for the
fund.


Smith Barney Sector Series Inc.

2

<PAGE>



The Global Biotechnology Fund may, but is not required to, use various
techniques, such as buying and selling futures and options contracts, to
increase or decrease its exposure to changing security prices or other factors
that affect security values. The fund may engage in foreign currency
transactions solely to manage its exposure to foreign securities. If the fund's
strategies do not work as intended, the fund may not achieve its objective.

Principal risks of investing in the Fund

Investors could lose money on their investments in the Global Biotechnology
Fund, or the fund may not perform as well as other investments, because:

[_] Stock markets are volatile and can decline significantly. The fund may
    invest a substantial portion of its assets in foreign securities. Foreign
    markets can be more volatile and can perform differently than the U.S.
    market because of increased risks of adverse issuer, political, regulatory,
    market or economic developments. Currency fluctuations may adversely impact
    the fund's investments.
[_] The biotechnology industry can be adversely affected by patent
    considerations, intense competition, rapid technological change and
    obsolescence, and government regulation. Biotechnology companies can have
    persistent losses during a new product's transition from development to
    production, and revenue patterns can be erratic.
[_] The value of an individual security or particular type of security can be
    more volatile than the market as a whole and can perform differently than
    the market as a whole. Smaller capitalized companies may involve greater
    risks, such as limited product lines, markets and financial or managerial
    resources.
[_] The Global Biotechnology Fund is "non-diversified," which means it may
    invest a larger percentage of its assets in one issuer than a diversified
    fund. To the extent the fund concentrates its assets in fewer issuers, the
    fund will be more susceptible to negative events affecting those issuers.
    The fund's investments are spread across the sector on which it focuses.
    However, because those investments are limited to a comparatively narrow
    segment of the economy, the fund's investments are not as diversified as
    most mutual funds, and far less diversified than the broad securities
    markets. This means that the fund tends to be more volatile than other
    mutual funds, and the values of its portfolio investments tend to increase
    and decrease more rapidly. As a result, the value of your investment in the
    fund may rise or fall rapidly.
[_] The judgment of the fund's manager about the attractiveness, growth
    prospects, value or potential appreciation of a particular stock may prove
    to be incorrect.

                                                                               3


                                                       Smith Barney Mutual Funds
<PAGE>

Who may want to invest The Global Biotechnology Fund may be an appropriate
investment if you:

[_] Are seeking to participate in the long-term growth potential of the
    biotechnology sector
[_] Are seeking capital appreciation and can tolerate short-term volatility
[_] Are looking for an investment with potentially greater return but higher
    risk
[_] Are comfortable with the risks of the stock market and the special risks of
    foreign securities, including emerging market securities
[_] Currently have exposure to the stock market and can tolerate concentrated
    investment in a single market sector

Performance

The Global Biotechnology Fund is new and does not yet have the performance
information which other Smith Barney funds show in bar and table form in this
part of the prospectus.

Fee table

This table sets forth the fees and expenses you will pay if you invest in
Global Biotechnology Fund shares.

                               Shareholder fees

<TABLE>
<CAPTION>
    (fees paid directly from your
    investment)                             Class A Class B Class L Class Y

    <S>                                     <C>     <C>     <C>     <C>
    Maximum sales charge (load)
    imposed on purchases
    (as a % of offering price)                5.00%    None   1.00%    None

    Maximum deferred sales charge (load)
    (as a % of the lower of net asset value
    at purchase or redemption-)               None*   5.00%   1.00%    None

</TABLE>

                        Annual fund operating expenses

<TABLE>
<CAPTION>
   (expenses deducted from fund assets)    Class A Class B Class L Class Y**

   <S>                                     <C>     <C>     <C>     <C>
   Management fee                            0.95%   0.95%   0.95%     0.95%

   Distribution and service (12b-1) fees     0.25%   1.00%   1.00% None

   Other expenses                            1.88%   1.89%   1.89%     1.88%
                                           ------- ------- ------- ---------
   Total annual fund operating expenses***   3.08%   3.84%   3.84%     2.83%

</TABLE>


Smith Barney Sector Series Inc.

4

<PAGE>



* You may buy Class A shares in amounts of $1,000,000 or more at net asset
value (without an initial sales charge) but if you redeem those shares within
12 months of their purchase, you will pay a deferred sales charge of 1.00%.

** For Class Y shares, "Other expenses" have been estimated based on expenses
incurred by Class A shares because no Class Y shares were outstanding during
the most recent fiscal period.

*** Currently, the manager has agreed to voluntarily waive a portion of the
management fees and reimburse a portion of the "Other expenses"
to limit total annual
fund operating expenses as indicated in the table below:

<TABLE>
<CAPTION>
                                               Class A Class B Class L

          <S>                                  <C>     <C>     <C>
          Management Fee                         0.19%   0.19%   0.19%

          Other Expenses                         1.06%  1.06%    1.06%

          Total annual fund operating expenses   1.50%   2.25%   2.25%

The manager may change or eliminate the management fee waiver and/or voluntary
expense limitation at any time

</TABLE>

Example

This example helps you compare the costs of investing in the Global
Biotechnology Fund with the costs of investing in other mutual funds. Your
actual costs may be higher or lower. The example assumes:

[_] You invest $10,000 in the fund for the period shown
[_] Your investment has a 5% return each year
[_] You reinvest all distributions and dividends without a sales charge
[_] The fund's operating expenses remain the same

                      Number of years you own your shares

<TABLE>
<CAPTION>
                                       1 year 3 years 5 years 10 years

          <S>                          <C>    <C>     <C>     <C>
          Class A                        $795  $1,403  $2,035   $3,723

          Class B                        $886  $1,472  $2,076   $3,907

          Class B (without redemption)   $386  $1,172  $1,976   $3,907

          Class L                        $582  $1,260  $2,057   $4,130

          Class L (without redemption)   $482  $1,260  $2,057   $4,130

          Class Y                        $286  $  877  $1,494   $3,157

</TABLE>


                                                                               5


                                                       Smith Barney Mutual Funds
<PAGE>

  Investments, risks and performance

Smith Barney Global Media & Telecommunications Fund

Investment objective

Smith Barney Global Media & Telecommunications Fund (the "Global Media &
Telecommunications Fund") seeks long-term capital appreciation.

Principal investment strategies

Key investments The Global Media & Telecommunications Fund normally invests at
least 80% of its assets in securities of companies principally engaged in, but
not limited to, the development, production, sale and distribution of goods or
services used in the broadcast and media industries; companies engaged in
design, development, manufacture, distribution, or sale of communications
services and equipment; and companies that are involved in supplying equipment
or services to such companies, as well as companies that offer telephone
service, wireless communications, satellite communications, television and
movie programming, broadcasting and Internet access.

The Global Media & Telecommunications Fund may invest without limitation in
securities of foreign issuers and will invest in securities of issuers located
in at least three countries, including the U.S. The fund invests primarily in
companies with medium and large market capitalizations. To a lesser extent, the
fund also may invest in equity securities of companies with small market
capitalizations. Medium and large market capitalization companies are those
companies with market capitalizations exceeding $5 billion.

Selection process The Global Media & Telecommunications Fund normally invests
at least 80% of its assets in companies doing business in the media and
telecommunications sector. The remainder of the fund's assets are not required
to be invested in that sector. To determine whether a company is principally
doing business in the sector, it must meet at least one of the following tests:

[_] At least 50% of its gross income or its net sales must come from activities
    in the sector;
[_] At least 50% of its assets must be devoted to producing revenues from the
    sector; or
[_] Based on other available information, the manager determines that the
    company's primary business is within the sector.


Smith Barney Sector Series Inc.

6

<PAGE>



In buying and selling securities, the Global Media & Telecommunications Fund
relies on fundamental analysis of each issuer and its potential for success in
light of its current financial condition and its industry position. Factors
considered, among other things, include long-term growth potential, earnings
estimates and quality of management. The fund may lend its securities to earn
income for the fund.

The Global Media & Telecommunication Fund may, but is not required to, use
various techniques, such as buying and selling futures and options contracts,
to increase or decrease the fund's exposure to changing security prices or
other factors that affect security values. The fund may engage in foreign
currency transactions solely to manage its exposure to foreign securities. If
the fund's strategies do not work as intended, the fund may not achieve its
objective.

Principal risks of investing in the Fund

Investors could lose money on their investments in the Global Media &
Telecommunications Fund, or the fund may not perform as well as other
investments, because:

[_] Stock markets are volatile and can decline significantly. The fund may
    invest a substantial portion of its assets in foreign securities. Foreign
    markets can be more volatile and can perform differently than the U.S.
    market because of increased risks of adverse issuer, political, regulatory,
    market or economic developments. Currency fluctuations may adversely impact
    the fund's investments.
[_] Media companies can be adversely affected by the governmental deregulation
    of cable and broadcasting, competitive pressures and government regulation.
    Telecommunications companies are subject to government regulation of rates
    of return and services that may be offered and can be adversely affected by
    intense competition.
[_] The value of an individual security or particular type of security can be
    more volatile than the market as a whole and can perform differently than
    the market as a whole. Smaller capitalized companies may involve greater
    risks, such as limited product lines, markets and financial or managerial
    resources.
[_] The Global Media & Telecommunication Fund is "non-diversified," which means
    it may invest a larger percentage of its assets in one issuer than a
    diversified fund. To the extent the fund concentrates its assets in fewer
    issuers, the fund will be more susceptible to events affecting those
    issuers. The fund's investments are spread across the sector on which it
    focuses. However, because those investments are limited to a compara-
    tively narrow segment of the economy, the fund's investments are not as
    diversified as most mutual funds, and far less diversified than the broad

                                                                               7


                                                       Smith Barney Mutual Funds
<PAGE>

    securities markets. This means that the fund tends to be more volatile than
    other mutual funds, and the values of its portfolio investments tend to
    increase or decrease more rapidly. As a result, the value of your
    investment in the fund may rise or fall rapidly.
[_] The judgment of the fund's manager about the attractiveness, growth
    prospects, value or potential appreciation of a particular stock may prove
    to be incorrect.

Who may want to invest The Global Media & Telecommunications Fund may be an
appropriate investment if you:

[_] Are seeking to participate in the long-term growth potential of the media
    and telecommunications sector
[_] Are seeking capital appreciation and can tolerate significant short-term
    volatility
[_] Are looking for an investment with potentially greater return but higher
    risk
[_] Are comfortable with the risks of the stock market and the special risks of
    foreign securities, including emerging market securities
[_] Currently have exposure to the stock market and can tolerate concentrated
    investment in a single market sector

Performance

The Global Media & Telecommunications Fund is new and does not yet have the
performance information which other Smith Barney funds show in bar and table
form in this part of the prospectus.


Smith Barney Sector Series Inc.

8

<PAGE>



Fee table

This table sets forth the fees and expenses you will pay if you invest in
Global Media & Telecommunications Fund shares.

                               Shareholder fees

<TABLE>
<CAPTION>
   (fees paid directly from your investment) Class A Class B Class L Class Y

   <S>                                       <C>     <C>     <C>     <C>
   Maximum sales charge (load)
   imposed on purchases
   (as a % of offering price)                 5.00%     None   1.00%    None

   Maximum deferred sales charge (load)
   (as a % of the lower of net asset value
   at purchase or redemption)                  None*   5.00%   1.00%    None

</TABLE>

                        Annual fund operating expenses

<TABLE>
<CAPTION>
(expenses deducted from fund assets)  Class A Class B Class L Class Y**

<S>                                   <C>     <C>     <C>     <C>
Management fee                          0.80%   0.80%   0.80%     0.80%

Distribution and service (12b-1) fees   0.25%   1.00%   1.00% None

Other expenses                          6.03%   6.05%   6.05%     6.03%

                                      ------- ------- ------- ---------
Total annual fund operating
expenses***                           7.08%   7.85%   7.85%   6.83%

</TABLE>

* You may buy Class A shares in amounts of $1,000,000 or more at net asset
value (without an initial sales charge) but if you redeem those shares within
12 months of their purchase, you will pay a deferred sales charge of 1.00%.

** For Class Y shares, "Other expenses" have been estimated based on expenses
incurred by Class A shares because no Class Y shares were outstanding during
the most recent fiscal period.

*** Currently, the manager has agreed to voluntarily waive the management fees
and reimburse a portion of "Other expenses" to limit total annual fund
operating expenses as indicated in the table below:

<TABLE>
<CAPTION>
                                               Class A Class B Class L

          <S>                                  <C>     <C>     <C>
          Management fee                         0.00%   0.00%   0.00%

          Other expenses                         1.25%   1.25%   1.25%

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

          Total annual fund operating expenses   1.50%   2.25%   2.25%

The manager may change or eliminate the management fee waiver and/or voluntary
expense limitation at any time

</TABLE>

                                                                               9


                                                       Smith Barney Mutual Funds
<PAGE>

Example

This example helps you compare the costs of investing in the Global Media &
Telecommunications Fund with the costs of investing in other mutual funds. Your
actual costs may be higher or lower. The example assumes:

[_] You invest $10,000 in the fund for the period shown
[_] Your investment has a 5% return each year
[_] You reinvest all distributions and dividends without a sales charge
[_] The fund's operating expenses remain the same

                      Number of years you own your shares

<TABLE>
<CAPTION>
                             1 year 3 years 5 years 10 years

<S>                          <C>    <C>     <C>     <C>
Class A                      $1,166  $2,456 $3,692  $6,566

Class B                      $1,274  $2,556 $3,755  $6,707

Class B (without redemption) $  774  $2,256 $3,655  $6,707

Class L                      $  966  $2,333 $3,718  $6,849

Class L (without redemption) $  866  $2,333 $3,718  $6,849

Class Y                      $  677  $1,993 $3,262  $6,237

</TABLE>


Smith Barney Sector Series Inc.

10

<PAGE>

  Investments, risks and performance

Smith Barney Global Technology Fund

Investment objective

Smith Barney Global Technology Fund (the "Global Technology Fund") seeks
long-term capital appreciation.

Principal investment strategies

Key investments The Global Technology Fund normally invests at least 80% of its
assets in securities of companies principally engaged in, but not limited to,
offering, using or developing products, processes or services that will provide
or will benefit significantly from technological advances and improvements.
These companies may include companies that develop, produce or distribute
products or services in the computer, semi-conductor, software, electronics,
media, communications, health care, and biotechnology industries.

The Global Technology Fund may invest without limitation in securities of
foreign issuers and will invest in securities of issuers located in at least
three countries, including the U.S. The fund invests primarily in companies
with medium and large market capitalizations. To a lesser extent, the fund also
may invest in equity securities of companies with small market capitalizations.
Medium and large market capitalization companies are those companies with
market capitalizations exceeding $5 billion.

Selection process The Global Technology Fund normally invests at least 80% of
its assets in companies doing business in the technology sector. The remainder
of the fund's assets are not required to be invested in that sector. To
determine whether a company is principally doing business in the sector, it
must meet at least one of the following tests:

[_] At least 50% of its gross income or its net sales must come from activities
    in the sector;
[_] At least 50% of its assets must be devoted to producing revenues from the
    sector; or
[_] Based on other available information, the manager determines that the
    company's primary business is within the sector.

In buying and selling securities, the Global Technology Fund relies on
fundamental analysis of each issuer and its potential for success in light of
its current financial condition and its industry position. Factors considered,
among other things, include long-term growth potential, earnings estimates and
quality of management. The fund may lend its securities to earn income for the
fund.


                                                       Smith Barney Mutual Funds

                                                                              11

<PAGE>

The Global Technology Fund may, but is not required to, use various techniques,
such as buying and selling futures and options contracts, to increase or
decrease the fund's exposure to changing security prices or other factors that
affect security values. The fund may engage in foreign currency transactions
solely to manage its exposure to foreign securities. If the fund's strategies
do not work as intended, the fund may not achieve its objective.

Principal risks of investing in the Fund

Investors could lose money on their investments in the Global Technology Fund,
or the fund may not perform as well as other investments, because:

[_] Stock markets are volatile and can decline significantly. The fund may
    invest a substantial portion of its assets in foreign securities. Foreign
    markets can be more volatile and can perform differently than the U.S.
    market because of increased risks of adverse issuer, political, regulatory,
    market or economic developments. Currency fluctuations may adversely impact
    the fund's investments.
[_] Technology companies can be adversely affected by obsolescence of existing
    technology, short product cycles, falling prices and profits, and
    competition from new market entrants. The technology sector may be subject
    to greater governmental regulation than many other areas, and changes in
    governmental policies and the need for regulatory approvals may have a
    material adverse effect on the sector. The performance of the technology
    sector may differ in direction and degree from that of the overall stock
    market.
[_] The value of an individual security or particular type of security can be
    more volatile than the market as a whole and can perform differently than
    the market as a whole. Smaller capitalized companies may involve greater
    risks such as limited product lines, markets and financial or managerial
    resources.
[_] The Global Technology Fund is "non-diversified," which means it may invest
    a larger percentage of its assets in one issuer than a diversified fund. To
    the extent the fund concentrates its assets in fewer issuers, the fund will
    be more susceptible to negative events affecting those issuers. The fund's
    investments are spread across the sector on which it focuses. However,
    because those investments are limited to a comparatively narrow segment of
    the economy, the fund's investments are not as diversified as most mutual
    funds, and far less diversified than the broad securities markets. This
    means that the fund tends to be more volatile than other mutual funds, and
    the values of its portfolio investments tend to increase or decrease more
    rapidly. As a result, the value of your investment in the fund may rise or
    fall rapidly.


Smith Barney Sector Series Inc.

12

<PAGE>

[_] The judgment of the fund's manager about the attractiveness, growth
    prospects, value or potential appreciation of a particular stock may prove
    to be incorrect.

Who may want to invest The Global Technology Fund may be an appropriate
investment if you:

[_] Are seeking to participate in the long-term growth potential of the
    technology sector
[_] Are seeking capital appreciation and can tolerate significant short-term
    volatility
[_] Are looking for an investment with potentially greater return but higher
    risk
[_] Are comfortable with the risks of the stock market and the special risks of
    foreign securities, including emerging market securities
[_] Currently have exposure to the stock market and can tolerate concentrated
    investment in a single market sector.

Performance

The Global Technology Fund is new and does not yet have the performance
information which other Smith Barney funds show in bar and table form in this
part of the prospectus.


                                                       Smith Barney Mutual Funds

                                                                              13

<PAGE>

Fee table

This table sets forth the fees and expenses you will pay if you invest in
Global Technology Fund shares.

                               Shareholder fees

<TABLE>
<CAPTION>
(fees paid directly from your investment) Class A Class B Class L Class Y

<S>                                       <C>     <C>     <C>     <C>
Maximum sales charge (load)
imposed on purchases
(as a % of offering price)                 5.00%     None   1.00%    None

Maximum deferred sales charge (load)
(as a % of the lower of net asset value
at purchase or redemption)                  None*   5.00%   1.00%    None

</TABLE>

                        Annual fund operating expenses

<TABLE>
<CAPTION>
    (expenses deducted from fund assets)  Class A Class B Class L Class Y**
    <S>                                   <C>     <C>     <C>     <C>
    Management fee                          0.95%   0.95%   0.95%     0.95%

    Distribution and service (12b-1) fees   0.25%   1.00%   1.00%      None

    Other expenses                          9.16%   0.50%   0.50%     9.16%

                                          ------- ------- ------- ---------
    Total annual fund operating
    expenses***                            10.36%  11.08%  11.08%    10.11%

</TABLE>
* You may buy Class A shares in amounts of $1,000,000 or more at net asset
value (without an initial sales charge) but if you redeem those shares within
12 months of their purchase, you will pay a deferred sales charge of 1.00%.

** For Class Y shares, "Other expenses" have been estimated based on expenses
incurred by Class A shares because no Class Y shares were outstanding during
the most recent fiscal period.

*** Currently, the manager has agreed to voluntarily waive a portion of the
management fees and reimburse a portion of "Other expenses" to limit total
annual fund operating expenses as indicated in the table below:


<TABLE>
<CAPTION>
                                               Class A Class B Class L

          <S>                                  <C>     <C>     <C>
          Management fee                         0.00%   0.00%   0.00%

          Other expenses                         1.25%   1.25%   1.25%

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

          Total annual fund operating expenses   1.50%   2.25%   2.25%

</TABLE>
The manager may change or eliminate the management fee waiver and/or voluntary
expense limitation at any time

Smith Barney Sector Series Inc.

14

<PAGE>

Example

This example helps you compare the costs of investing in the Global Technology
Fund with the costs of investing in other mutual funds. Your actual costs may
be higher or lower. The example assumes:

[_] You invest $10,000 in the fund for the period shown
[_] Your investment has a 5% return each year
[_] You reinvest all distributions and dividends without a sales charge
[_] The fund's operating expenses remain the same

                      Number of years you own your shares

<TABLE>
<CAPTION>
                                       1 year 3 years 5 years 10 years

          <S>                          <C>    <C>     <C>     <C>
          Class A                      $1,458  $3,222 $4,803  $8,069

          Class B                      $1,574  $3,331 $ 4,857  $ 8,160

          Class B (without redemption) $1,074  $3,031 $4,757  $8,160

          Class L                      $1,264  $3,101 $ 4,809  $ 8,251

          Class L (without redemption) $1,164  $3,101 $4,809  $8,251

          Class Y                      $  985  $2,807 $ 4,447  $ 7,869

</TABLE>

  More on the funds' investments

Foreign investments Each fund's investments in securities of foreign issuers
involves greater risk than investments in securities of U.S. issuers. Many
foreign countries the funds may invest in have markets that are less liquid and
more volatile than markets in the U.S. In some foreign countries, less
information is available about foreign issuers and markets because of less
rigorous accounting and regulatory standards than in the U.S. Currency
fluctuations could erase investment gains or add to investment losses. The
risks of investing in foreign securities are greater for securities of emerging
market issuers because political or economic instability, lack of market
liquidity, and negative government actions such as currency controls or seizure
of private businesses or property are more likely.

Derivatives and hedging techniques Each fund may, but need not, use derivate
contracts, such as futures and options on securities, securities indices or
currencies; options on these futures; forward currency contracts; and interest
rate or currency swaps for any of the following purposes:

[_] To hedge against the economic impact of adverse changes in the market value
    of its securities, because of changes in stock market prices, currency
    exchange rates or interest rates
[_] To settle transactions in securities quoted in foreign currencies
[_] As a substitute for buying or selling securities
[_] As a cash flow management technique



                                                       Smith Barney Mutual Funds

                                                                              15

<PAGE>

A derivative contract will obligate or entitle a fund to deliver or receive an
asset or cash payment based on the change in value of one or more securities,
currencies or indices. Even a small investment in derivative contracts can have
a big impact on a fund's stock market, currency and interest rate exposure.
Therefore, using derivatives can disproportionately increase losses and reduce
opportunities for gains when stock prices, currency rates or interest rates are
changing. A fund may not fully benefit from or may lose money on derivatives if
changes in their value do not correspond accurately to changes in the value of
the fund's holdings. The other parties to certain derivative contracts present
the same types of credit risk as issuers of fixed income securities.
Derivatives can also make a fund less liquid and harder to value, especially in
declining markets.

Defensive investing Each fund may depart from its principal investment
strategies in response to adverse market, economic or political conditions by
taking temporary defensive positions in all types of money market and
short-term debt securities. If a fund takes a temporary defensive position, it
may be unable to achieve its investment goal.

Master/feeder option Each fund may in the future seek to achieve its investment
objective by investing all of its net assets in another investment company
having the same investment objective and substantially the same investment
policies and restrictions as those applicable to the fund.

  Management

Manager Each fund's investment manager is SSB Citi Fund Management LLC, an
affiliate of Salomon Smith Barney Inc. ("Salomon Smith Barney") The manager's
address is 7 World Trade Center, New York, New York 10048. The manager oversees
the selection of a fund's investments and its general operations. The manager
and Salomon Smith Barney are subsidiaries of Citigroup Inc. Citigroup
businesses offer a broad range of financial services--asset management, banking
and consumer finance, credit and charge cards, insurance, investments,
investment banking and trading--and use diverse channels to make them available
to consumer and corporate customers around the world.

Pursuant to a written agreement, State Street Bank and Trust Company provides
certain fund accounting services and calculates the daily net asset value for
each of the funds. The principal business address of State Street is 225
Franklin Street, Boston, Massachusetts 02110.

Subadviser Citibank, N.A., an affiliate of the manager through its Citibank
Global Asset Management division, located at 100 First Stamford Place,


Smith Barney Sector Series Inc.

16

<PAGE>

Stamford, Connecticut 06902, serves as subadviser to each fund. The manager,
and not the funds, pays the subadviser for its services out of its management
fee. The subadviser, utilizing a portfolio management team approach, manages a
fund's investment portfolio, subject to the supervision of the manager. The
subadviser provides investment management and advisory services to other mutual
funds and, with its affiliates, currently manages over $351 billion in assets
worldwide.

Management fees For services provided to the funds, each fund pays the manager
the annual investment management fee described below (equal to the following
percentage of a fund's average daily net assets):

<TABLE>
<CAPTION>
<S>                                     <C>
Global Biotechnology Fund:              0.95%
Global Media & Telecommunications Fund: 0.80%
Global Technology Fund:                 0.95%
</TABLE>

Sub-Advisory fees For services provided to the funds, the manager pays the
subadviser the annual subadvisory fee described below (equal to the following
percentage of a fund's average daily net assets):

<TABLE>
<CAPTION>
<S>                                     <C>
Global Biotechnology Fund:              0.65%
Global Media & Telecommunications Fund: 0.50%
Global Technology Fund:                 0.65%
</TABLE>

Distribution plans Each fund has adopted a Rule 12b-1 distribution plan for its
Class A, B and L shares. Under each plan, each fund pays distribution and/or
service fees. These fees are an ongoing expense and, over time, may cost you
more than other types of sales charges.

In addition, a distributor may make payments for distribution and/or
shareholder servicing activities out of its past profits and other available
sources. A distributor may also make payments to dealers for marketing,
promotional or related expenses. The amount of these payments is determined by
the distributor and may be substantial. SSB Citi or an affiliate may make
similar payments under similar arrangements.

Transfer agent and shareholder servicing agent Citi Fiduciary Trust Company
serves as each fund's transfer agent and shareholder servicing agent (the
"transfer agent"). The transfer agent has entered into sub-transfer agency and
services agreements with PFPC Global Fund Services to serve as each fund's
sub-transfer agent (the "sub-transfer agent"). The sub-transfer agent will
perform certain functions, including shareholder record keeping and accounting
services.


                                                       Smith Barney Mutual Funds

                                                                              17

<PAGE>

  Choosing a class of shares to buy

You can choose among four classes of shares: Classes A, B, L and Y. Each class
has different sales charges and expenses, allowing you to choose the class that
best meets your needs. Which class is more beneficial to an investor depends on
the amount and intended length of the investment. (Please note that all classes
of shares are not available through all Service Agents as defined below. You
should contact your Service Agent for further information.)

[_] If you plan to invest regularly or in large amounts, buying Class A shares
    may help you reduce sales charges and ongoing expenses.
[_] For Class B shares, all of your purchase amount and, for Class L shares,
    more of your purchase amount (compared to Class A shares) will be
    immediately invested. This may help offset the higher expenses of Class B
    and Class L shares, but only if the fund performs well.
[_] Class L shares have a shorter deferred sales charge period than Class B
    shares. However, because Class B shares convert to Class A shares, and
    Class L shares do not, Class B shares may be more attractive to long-term
    investors.

You may buy shares from:
[_] A broker/dealer, financial intermediary financial institution or a
    distributor's financial consultants (each called a "Service Agent")
[_] The fund, but only if you are investing through certain qualified plans or
    Service Agents.

Investment minimums Minimum initial and additional investment amounts vary
depending on the class of shares you buy and the nature of your investment
account.

<TABLE>
<CAPTION>
                                           Initial                 Additional

                                       Classes A, B, L   Class Y   All Classes

 <S>                                   <C>             <C>         <C>
 General                                        $1,000 $15 million         $50

 IRAs, Self Employed Retirement
 Plans, Uniform Gift to Minor
 Accounts                                       $  250 $15 million         $50

 Qualified Retirement Plans*                    $   25 $15 million         $25

 Simple IRAs                                    $    1     n/a             $ 1

 Monthly Systematic Investment Plans            $   25     n/a             $25

 Quarterly Systematic Investment Plans          $   50     n/a             $50

</TABLE>

* Qualified Retirement Plans are retirement plans qualified under Section
403(b)(7) or Section 401(a) of the Internal Revenue Code, including 401(k)
plans


Smith Barney Sector Series Inc.

18

<PAGE>

  Comparing the funds' classes

Your Service Agent can help you decide which class meets your goals. The
Service Agent may receive different compensation depending upon which class you
choose.

<TABLE>
<CAPTION>
                   Class A           Class B           Class L           Class Y

<S>            <C>              <C>               <C>               <C>

Key features   .Initial sales   .No initial sales .The initial      .No initial or
                charge           charge            sales charge is   deferred sales
               .You may         .Deferred sales    lower than        charge
                qualify for      charge de-        Class A          .Must invest at
                reduction or     clines over      .Deferred sales    least $15
                waiver of ini-   time              charge for        million
                tial sales      .Converts to       only 1 year      .Lower annual
                charge           Class A after 8  .Does not con-     expenses than
               .Lower            years             vert to Class A   the other
                annual ex-      .Higher annual    .Higher annual     classes
                penses than      expenses than     expenses than
                Class B and      Class A           Class A
                Class L

-------------------------------------------------------------------------------------
Initial sale   Up to 5.00%;     None              1.00%             None
charge         reduced for
               large purchases
               and waived for
               certain
               investors; no
               charge for
               purchases of
               $1,000,000 or
               more

-------------------------------------------------------------------------------------
Deferred sales 1.00% on         Up to 5.00%       1.00% if you      None
charge         purchases of     charged when      redeem within 1
               $1,000,000 or    you redeem        year of purchase
               more if you      shares. The
               redeem within    charge is
               1 year of        reduced over
               purchase         time and there is
                                no deferred sales
                                charge after 6
                                years

-------------------------------------------------------------------------------------
Annual         0.25% of         1.00% of average  1.00% of average  None
distribution   average daily    daily net assets  daily net assets
and service    net assets
fees

-------------------------------------------------------------------------------------
Exchange       Class A shares   Class B shares of Class L shares of Class Y shares of
privilege*     of most Smith    most Smith        most Smith        most Smith
               Barney funds     Barney funds      Barney funds      Barney funds

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

* Ask your Service Agent for the Smith Barney funds available for exchange.


                                                       Smith Barney Mutual Funds

                                                                              19

<PAGE>

  Sales charges

Class A shares

You buy Class A shares at the offering price, which is the net asset value plus
a sales charge. You pay a lower sales charge as the size of your investment
increases to certain levels called breakpoints. You do not pay a sales charge
on the fund's distributions or dividends you reinvest in additional Class A
shares.

The table below shows the rate of sales charge you pay, depending on the amount
you purchase. The table below also shows the amount of broker/dealer
compensation that is paid out of the sales charge. This compensation includes
commissions and other fees which Service Agents that sell shares of the fund
receive. The distributor keep up to approximately 10% of the sales charge
imposed on Class A shares. Service Agents also will receive the service fee
payable on Class A shares at an annual rate equal to 0.25% of the average daily
net assets represented by the Class A shares sold by them.

<TABLE>
<CAPTION>

                                      Sales Charge as a % of
                                                             Broker/Dealer
                                      Offering   Net amount    commission
    Amount of purchase                price (%) invested (%)   as a % of
                                                             offering price
    <S>                               <C>       <C>          <C>
    Less than $25,000                      5.00         5.26          4.50

    $25,000 but less than $50,000          4.25         4.44          3.83

    $50,000 but less than $100,000         3.75         3.90          3.38

    $100,000 but less than $250,000        3.25         3.36          2.93

    $250,000 but less than $500,000        2.75         2.83          2.48

    $500,000 but less than $1,000,000      2.00         2.04          1.80

    $1,000,000 or more                      -0-          -0-    up to 1.00*

</TABLE>

* A distributor pays up to 1.00% to a Service Agent.

Investments of $1,000,000 or more You do not pay an initial sales charge when
you buy $1,000,000 or more of Class A shares. However, if you redeem these
Class A shares within one year of purchase, you will pay a deferred sales
charge of 1%.

Qualifying for a reduced Class A sales charge There are several ways you can
combine multiple purchases of Class A shares of Smith Barney funds to take
advantage of the breakpoints in the sales charge schedule.


Smith Barney Sector Series Inc.

20

<PAGE>

Accumulation privilege - lets you combine the current value of Class A shares
owned

[_] by you, or
[_] by members of your immediate family,

  and for which a sales charge was paid, with the amount of your next purchase
  of Class A shares for purposes of calculating the initial sales charge.
  Certain trustees and fiduciaries may be entitled to combine accounts in
  determining their sales charge.

Letter of intent - lets you purchase Class A shares of a fund and other Smith
Barney funds over a 13-month period and pay the same sales charge, if any, as
if all shares had been purchased at once. You may include purchases on which
you paid a sales charge made within 90 days before you sign the letter.

Waivers for certain Class A investors Class A initial sales charges are waived
for certain types of investors, including:

[_]    Employees of NASD members
[_]    Investors participating in a fee-based program sponsored by certain
       broker/dealers affiliated with Citigroup
[_]    Investors who redeemed Class A shares of a Smith Barney fund in the past
       60 days, if the investor's Service Agent is notified

If you want to learn about additional waivers of Class A initial sales charges,
contact your Service Agent or consult the Statement of Additional Information
("SAI").

Class B shares

You buy Class B shares at net asset value without paying an initial sales
charge. However, if you redeem your Class B shares within six years of
purchase, you will pay a deferred sales charge. The deferred sales charge
decreases as the number of years since your purchase increases.

<TABLE>
<CAPTION>
           Year after purchase   1st 2nd 3rd 4th 5th 6th through 8th

           <S>                   <C> <C> <C> <C> <C> <C>
           Deferred sales charge 5%  4%  3%  2%  1%  0%

</TABLE>

Service Agents selling Class B shares receive a commission of up to 4.50% of
the purchase price of the Class B shares they sell. Service Agents also receive
a service fee at an annual rate equal to 0.25% of the average daily net assets
represented by the Class B shares they are servicing.


                                                       Smith Barney Mutual Funds

                                                                              21

<PAGE>

Class B conversion After 8 years, Class B shares automatically convert into
Class A shares. This helps you because Class A shares have lower annual
expenses. Your Class B shares will convert to Class A shares as follows:

<TABLE>
<CAPTION>
    Shares issued:             Shares issued:           Shares issued:
    At initial                 On reinvestment of       Upon exchange from
    purchase                   dividends and            another Smith Barney
                               distributions            fund

    <S>                        <C>                      <C>
    Eight years after the date In same proportion as    On the date the
    of purchase                the number of Class B    shares originally
                               shares converting is to  acquired would have
                               total Class B shares you converted into Class
                               own (excluding shares    A shares
                               issued as a dividend)
</TABLE>

Class L shares

You buy Class L shares at the offering price, which is the net asset value plus
a sales charge of 1% (1.01% of the net amount invested). In addition, if you
redeem your Class L shares within one year of purchase, you will pay a deferred
sales charge of 1%. If you held Class C shares of any other Smith Barney mutual
funds on June 12, 1998, you will not pay an initial sales charge on Class L
shares you buy before June 22, 2001.

Service Agents selling Class L shares receive a commission of up to 2.00% of
the purchase price of the Class L shares they sell. Starting in the thirteenth
month, Service Agents also receive an annual fee of up to 1.00% of the average
daily net assets represented by the Class L shares held by their clients.

Class Y shares

You buy Class Y shares at net asset value with no initial sales charge and no
deferred sales charge when you redeem. You must meet the $15,000,000 initial
investment requirement. You can use a letter of intent to meet this requirement
by buying Class Y shares of the fund over a 13-month period. To qualify, you
must initially invest $5,000,000.


Smith Barney Sector Series Inc.

22

<PAGE>

  More about deferred sales charges

The deferred sales charge is based on the net asset value at the time of
purchase or redemption, whichever is less. Therefore, you do not pay a sales
charge on amounts representing appreciation or depreciation.

In addition, you do not pay a deferred sales charge on:

[_] Shares exchanged for shares of another Smith Barney fund
[_] Shares representing reinvested distributions and dividends
[_] Shares no longer subject to the deferred sales charge

Each time you place a request to redeem shares, the fund will first redeem any
shares in your account that are not subject to a deferred sales charge and then
the shares in your account that have been held the longest.

If you redeemed shares of a Smith Barney fund in the past 60 days and paid a
deferred sales charge, you may buy shares of the fund at the current net asset
value and be credited with the amount of the deferred sales charge, if you
notify your Service Agent.

The fund's distributor receive deferred sales charges as partial compensation
for their expenses in selling shares, including the payment of compensation to
your Service Agent.

Deferred sales charge waivers

The deferred sales charge for each share class will generally be waived:

[_] On payments made through certain systematic withdrawal plans
[_] On certain distributions from a retirement plan
[_] For involuntary redemptions of small account balances
[_] For 12 months following the death or disability of a shareholder

If you want to learn more about additional waivers of deferred sales charges,
contact your Service Agent or consult the SAI.


                                                       Smith Barney Mutual Funds

                                                                              23

<PAGE>

  Buying shares

<TABLE>
<CAPTION>
<S>               <C>
Through a Service You should contact your Service Agent to open a
            Agent brokerage account and make arrangements to buy
                  shares. If you do not provide the following information,
                  your order will be rejected:

                  [_]Class of shares being bought
                  [_]Dollar amount or number of shares being bought

                  Your Service Agent may charge an annual account
                  maintenance fee.

--------------------------------------------------------------------------------
 Through the fund Qualified retirement plans and certain other investors
                  who are clients of certain Service Agents are eligible to
                  buy shares directly from the fund.

                  [_]Write the fund at the following address:
                      Smith Barney Sector Series Inc.
                      (Specify fund and class of shares)
                      c/o PFPC Global Fund Services
                      P.O. Box 9699
                      Providence, RI 02940-9699

                  [_]Enclose a check to pay for the shares. For initial
                     purchases, complete and send an account applica-
                     tion.
                  [_]For more information, call the transfer agent at
                     1-800-451-2010.

--------------------------------------------------------------------------------
        Through a You may authorize your Service Agent or a sub-transfer
       systematic agent to transfer funds automatically from (i) a regular
  investment plan bank account (ii) cash held in a brokerage account
                  opened with a Service Agent or (iii) certain money
                  market funds, in order to buy shares on a regular basis.

                  [_]Amounts transferred should be at least $25 monthly
                     or $50 quarterly
                  [_]If you do not have sufficient funds in your account
                     on a transfer date, your Service Agent or the appli-
                     cable sub-transfer agent may charge you a fee

                  For more information, contact your Service Agent or the trans-
                  fer agent or consult the SAI.

</TABLE>


Smith Barney Sector Series Inc.

24

<PAGE>

<TABLE>
<CAPTION>
<S>                  <C>
  Exchanging shares

 Smith Barney offers You should contact your Service Agent to exchange
a distinctive family into other Smith Barney funds. Be sure to read the
of funds tailored to prospectus of the Smith Barney fund you are
       help meet the exchanging into. An exchange is a taxable transaction.
    varying needs of
      both large and [_]You may exchange shares only for shares of the same
     small investors    class of another Smith Barney fund. Not all Smith
                        Barney funds offer all classes.
                     [_]Not all Smith Barney funds may be offered in your
                        state of residence. Contact your Service Agent or the
                        transfer agent.
                     [_]You must meet the minimum investment amount for
                        each fund (except for systematic investment plan
                        exchanges).
                     [_]If you hold share certificates, the sub-transfer agent
                        must receive the certificates endorsed for transfer or
                        with signed stock powers (documents transferring
                        ownership of certificates) before the exchange is ef-
                        fective.
                     [_]A fund may suspend or terminate your exchange
                        privilege if you engage in an excessive pattern of
                        exchanges.

Waiver of additional Your shares will not be subject to an initial sales charge
       sales charges at the time of the exchange.

                     Your deferred sales charge (if any) will continue to be
                     measured from the date of your original purchase. If
                     the fund you exchange into has a higher deferred sales
                     charge, you will be subject to that charge. If you
                     exchange at any time into a fund with a lower charge,
                     the sales charge will not be reduced.

        By telephone If you do not have a brokerage account with a Service
                     Agent, you may be eligible to exchange shares through the
                     fund. You must complete an authorization form to
                     authorize telephone transfers. If eligible, you may make
                     telephone exchanges on any day the New York Stock
                     Exchange is open. Call the transfer agent at 1-800-451-2010
                     between 9:00 a.m. and 4:00 p.m. (Eastern time).


</TABLE>


                                                       Smith Barney Mutual Funds

                                                                              25

<PAGE>

<TABLE>
<CAPTION>
<S>       <C>
          You can make telephone exchanges only between
          accounts that have identical registrations.

---------------------------------------------------------------------
  By mail If you do not have a brokerage account, contact your
          Service Agent or write to the sub-transfer agent at the
          address below.

  Redeeming shares

Generally Contact your Service Agent to redeem shares of a fund.

          If you hold share certificates, the sub-transfer agent
          must receive the certificates endorsed for transfer or
          with signed stock powers (documents transferring
          ownership of certificates) before the redemption is
          effective.

          If the shares are held by a fiduciary or corporation,
          other documents may be required.

          Your redemption proceeds will be sent within three
          business days after your request is received in good
          order. However, if you recently purchased your shares
          by check, your redemption proceeds will not be sent to
          you until your original check clears, which may take up
          to 15 days.

          If you have a brokerage account with a Service Agent,
          your redemption proceeds will be placed in your
          account and not reinvested without your specific
          instruction. In other cases, unless you direct
          otherwise, your redemption proceeds will be paid by
          check mailed to your address of record.

---------------------------------------------------------------------
  By mail For accounts held directly at a fund, send written
          requests to the fund at the following address:

              Smith Barney Sector Series Inc.
              (Specify fund and class of shares)
              c/o PFPC Global Fund Services
              P.O. Box 9699
              Providence, RI 02940-9699

</TABLE>


Smith Barney Sector Series Inc.

26

<PAGE>

<TABLE>
<CAPTION>
<S>              <C>
                 Your written request must provide the following:

                 .The name of fund and account number
                 .The class of shares and the dollar amount or num-
                  ber of shares to be redeemed
                 .Signatures of each owner exactly as the account is
                  registered

--------------------------------------------------------------------------------
    By telephone If you do not have a brokerage account with a Service
                 Agent, you may be eligible to redeem shares (except
                 those held in retirement plans) in amounts up to
                 $50,000 per day through the fund. You must complete
                 an authorization form to authorize telephone
                 redemptions. If eligible, you may request redemptions by
                 telephone on any day the New York Stock Exchange is
                 open. Call the transfer agent at 1-800-451-2010 between
                 9:00 a.m. and 4:00 p.m. (Eastern time).

                 Your redemption proceeds can be sent by check to your
                 address of record or by wire or electronic transfer
                 (ACH) to a bank account designated on your
                 authorization form. You must submit a new
                 authorization form to change the bank account
                 designated to receive wire or electronic transfers and you
                 may be asked to provide certain other documents. A sub-
                 transfer agent may charge a fee on an electronic transfer
                 (ACH).

--------------------------------------------------------------------------------
  Automatic cash You can arrange for the automatic redemption of a
withdrawal plans portion of your shares on a monthly or quarterly basis.
                 To qualify you must own shares of the fund with a value
                 of at least $10,000 ($5,000 for retirement plan
                 accounts) and each automatic redemption must be at
                 least $50. If your shares are subject to a deferred sales
                 charge, the sales charge will be waived if your automatic
                 payments do not exceed 1% per month of the value of
                 your shares subject to a deferred charge.

                 The following conditions apply:

                 .Your shares must not be represented by certificates
                 .All dividends and distributions must be reinvested

                 For more information, contact your Service Agent or consult the
                 SAI.
</TABLE>



                                                       Smith Barney Mutual Funds

                                                                              27

<PAGE>

  Other things to know about share transactions

When you buy, exchange or redeem shares, your request must be in good order.
This means you have provided the following information without which your
request will not be processed:

[_] Name of the fund
[_] Account number
[_] Class of shares being bought, exchanged or redeemed
[_] Dollar amount or number of shares being bought, exchanged or redeemed
[_] Signature of each owner exactly as the account is registered

The fund will employ reasonable procedures to confirm that any telephone
exchange or redemption request is genuine, including, recording calls, asking
the caller to provide certain personal identification information, sending you
a written confirmation or requiring other confirmation procedures from time to
time. If these procedures are employed, neither the fund nor the transfer agent
will bear any liability for such transactions.

Signature guarantees To be in good order, your redemption request must include
a signature guarantee if you:

[_] Are redeeming over $50,000
[_] Are sending signed share certificates or stock powers to the sub-transfer
    agent
[_] Instruct the sub-transfer agent to mail the check to an address different
    from the one on your account
[_] Changed your account registration
[_] Want the check paid to someone other than the account owner(s)
[_] Are transferring the redemption proceeds to an account with a different
    registration

You can obtain a signature guarantee from most banks, dealers, brokers, credit
unions and federal savings and loan institutions, but not from a notary public.

Each fund has the right to:

[_] Suspend the offering of shares
[_] Waive or change minimum and additional investment amounts
[_] Reject any purchase or exchange order
[_] Change, revoke or suspend the exchange privilege
[_] Suspend telephone transactions
[_] Suspend or postpone redemptions of shares on any day when trading on the
    New York Stock Exchange is restricted, or as otherwise permitted by the
    Securities and Exchange Commission
[_] Pay redemption proceeds by giving you securities. You may pay transaction
    costs to dispose of the securities



Smith Barney Sector Series Inc.

28

<PAGE>

Small account balances If your account falls below $500 ($250 for IRA accounts)
because of a redemption of fund shares, each fund may ask you to bring your
account up to the applicable minimum investment amount. If you choose not to do
so within 60 days, each fund may close your account and send you the redemption
proceeds.

Excessive exchange transactions The manager may determine that a pattern of
frequent exchanges is detrimental to a fund's performance and other
shareholders. Each fund may limit additional purchases and/or exchanges by a
shareholder.

Share certificates The funds do not issue share certificates unless a written
request signed by all registered owners is made to the sub-transfer agent. If
you hold share certificates it will take longer to exchange or redeem shares.

  Dividends, distributions and taxes

Dividends Each fund generally pays dividends and makes capital gain
distributions, if any, once a year, typically in December. Each fund may pay
additional distributions and dividends at other times if necessary for the fund
to avoid a federal tax. Each fund expects distributions to be primarily from
capital gains. Capital gain distributions and dividends are reinvested in
additional fund shares of the same class you hold. Alternatively, you can
instruct your Service Agent or the transfer agent or the sub-transfer agent to
have your distributions and/or dividends paid in cash. You can change your
choice at any time to be effective as of the next distribution or dividend,
except that any change given to your service agent, the transfer agent or the
sub-transfer agent less than five days before the payment date will not be
effective until the next distribution or dividend is paid.

Taxes In general, redeeming shares, exchanging shares and receiving
distributions (whether in cash or additional shares) are all taxable events.

<TABLE>
<CAPTION>
       Transaction                          Federal tax status

      <S>                                   <C>

      Redemption or exchange of shares      Usually capital gain or loss;
                                            long-term only if shares
                                            owned more than one year

      Long-term capital gain distributions  Long-term capital gain


      Short-term capital gain distributions Ordinary income


      Dividends                             Ordinary income

</TABLE>



                                                       Smith Barney Mutual Funds

                                                                              29

<PAGE>

Long-term capital gain distributions are taxable to you as long-term capital
gain regardless of how long you have owned your shares. You may want to avoid
buying shares when a fund is about to declare a long-term capital gain
distribution or a dividend, because it will be taxable to you even though it
may actually be a return of a portion of your investment.

After the end of each year, each fund will provide you with information about
the distributions and dividends you received and any redemptions of shares
during the previous year. If you do not provide the fund with your correct
taxpayer identification number and any required certifications, you may be
subject to back-up withholding of 31% of your distributions, dividends, and
redemption proceeds. Because each shareholder's circumstances are different and
special tax rules may apply, you should consult your tax adviser about your
investment in the fund.


Smith Barney Sector Series Inc.

30

<PAGE>

  Share price

You may buy, exchange or redeem shares at their net asset value, plus any
applicable sales charge, next determined after receipt of your request in good
order. Each fund's net asset value is the value of its assets minus its
liabilities. Net asset value is calculated separately for each class of shares.
Each fund calculates its net asset value every day the New York Stock Exchange
is open. This calculation is done when regular trading closes on the Exchange
(normally 4:00 p.m., Eastern time). The Exchange is closed on certain holidays
listed in the SAI.

Each fund generally values its fund securities based on market prices or
quotations. Each value is determined in accordance with procedures approved by
the fund's board. A fund that uses fair value to price securities may value
those securities higher or lower than another fund using market quotations to
price those same securities.

Each fund's currency conversions are done when the London stock exchange
closes. When reliable market prices or quotations are not readily available, or
when the value of a security has been materially affected by events occurring
after a foreign exchange closes, a fund may price those securities at fair
value. Fair value is determined in accordance with procedures approved by the
fund's board. Each fund that uses fair value to price securities may value
those securities higher or lower than another fund using market quotations to
price the same securities.

International markets may be open on days when U.S. markets are closed and the
value of foreign securities owned by a fund could change on days when you
cannot buy or redeem shares.

In order to buy, redeem or exchange shares at that day's price, you must place
your order with your Service Agent or the fund's sub-transfer agent before the
New York Stock Exchange closes. If the Exchange closes early, you must place
your order prior to the actual closing time. Otherwise, you will receive the
next business day's price.

Service Agents must transmit all orders to buy, exchange or redeem shares to
the fund's sub-transfer agent before the sub-transfer agent's close of
business.


                                                       Smith Barney Mutual Funds

                                                                              31

<PAGE>

  Financial Highlights

The financial highlights tables are intended to help you understand the
performance of each class for the past 5 years (or since inception if less than
5 years). Certain information reflects financial results for a single share.
Total return represents the rate that a shareholder would have earned (or lost)
on a fund share assuming reinvestment of all dividends and distributions. The
information in the following tables was audited by KPMG LLP, independent
auditors, whose report, along with the fund's financial statements, is included
in the annual report (available upon request).

No information is presented for Class Y shares of each fund since no Class Y
shares were outstanding for the period shown.

Global Biotechnology Fund

  For a Class A share of capital stock outstanding from August 31, 2000
  (inception date) through October 31, 2000:

<TABLE>
<CAPTION>
                                    2000/(1)/

---------------------------------------------
<S>                                <C>
Net asset value, beginning of period $11.40

---------------------------------------------
Loss from operations:
 Net investment loss/(2)/           (0.04)
 Net realized and unrealized loss   (1.48)

---------------------------------------------
Total loss from operations          (1.52)

---------------------------------------------
Less distributions from:
 Net investment income                 --
 Net realized gains                    --

---------------------------------------------
Total distributions                    --

---------------------------------------------
Net asset value, end of period      $9.88

---------------------------------------------
Total return                       (13.33)%**

---------------------------------------------
Net assets, end of period (000's)  $8,486

---------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                       1.52%*
 Net investment loss                (0.78)%*

---------------------------------------------
Portfolio turnover rate                 1%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waiver
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                          Net Investment       Expense Ratio
                            Loss Per Share    Without Waiver and Expense
Fund								Reimburserment
                                2000               2000

--------------------------------------------------------------
<S>                       <C>                   <C>
Global Biotechnology Fund               $(0.04)      3.08%
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


Smith Barney Sector Series Inc.

32

<PAGE>

  For a Class B share of capital stock outstanding from August 31, 2000
  (inception date) through October 31, 2000:
<TABLE>
<CAPTION>
<S>                                      <C>

                                          2000/(1)/
Net asset value, beginning of period      $11.40

---------------------------------------------------
Income (loss) from operations:
 Net investment loss/(2)/                  (0.05)
 Net realized and unrealized loss          (1.49)

---------------------------------------------------
Total loss from operations                 (1.54)

---------------------------------------------------
Less distributions from:
 Net investment income                        --
 Net realized gains                           --

---------------------------------------------------
Total distributions                           --

---------------------------------------------------
Net asset value, end of period             $9.86

---------------------------------------------------
Total return                              (13.57)%**

---------------------------------------------------
Net assets, end of period (000's)        $11,705

---------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                              2.28%*
 Net investment loss                       (1.51)%*

---------------------------------------------------
Portfolio turnover rate                        1%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waiver
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                          Net Investment        Expense Ratio
                            Loss Per Share     Without Waiver and Expense
Fund								Reimbursement
                                2000               2000

--------------------------------------------------------------
<S>                       <C>                   <C>
Global Biotechnology Fund         $(0.05)          3.84%
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


                                                       Smith Barney Mutual Funds

                                                                              33

<PAGE>

  For a Class L share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:

<TABLE>
<CAPTION>
                                          2000/(1)/

---------------------------------------------------
<S>                                     <C>
Net asset value, beginning of period       $11.40

---------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                   (0.06)
 Net realized and unrealized loss           (1.48)

---------------------------------------------------
Total loss from operations                  (1.54)

---------------------------------------------------
Less distributions from:
 Net investment income                         --
 Net realized gains                            --

---------------------------------------------------
Total distributions                            --

---------------------------------------------------
Net asset value, end of period              $9.86

---------------------------------------------------
Total return                             (13.51)%**

---------------------------------------------------
Net assets, end of period (000's)         $15,763

---------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                              2.28%*
 Net investment loss                      (1.51)%*

---------------------------------------------------
Portfolio turnover rate                         1%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waiver
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                          Net Investment   Expense Ratio
                            Loss Per Share    Without Waiver and Expense
Fund								Reimbursement
                                2000             2000

--------------------------------------------------------------
<S>                       <C>                   <C>
Global Biotechnology Fund          $(0.06)          3.84%
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


Smith Barney Sector Series Inc.

34

<PAGE>

Global Media & Telecommunications Fund

  For a Class A share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:

<TABLE>
<CAPTION>
                                          2000/(1)/

----------------------------------------------------
<S>                                      <C>
Net asset value, beginning of period        $11.40

----------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                    (0.09)
 Net realized and unrealized loss      )     (0.83)

----------------------------------------------------
Total loss from operations                   (0.92)

----------------------------------------------------
Less distributions from:
 Net investment income                          --
 Net realized gains                             --

----------------------------------------------------
Total distributions                             --

----------------------------------------------------
Net asset value, end of period              $10.48

----------------------------------------------------
Total return                               (8.07)%**

----------------------------------------------------
Net assets, end of period (000)'s           $1,237

----------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                              1.52%*
 Net investment loss                      (0.35)%*

----------------------------------------------------
Portfolio turnover rate                          3%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waiver
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                                         Net Investment     Expense Ratio
                                           Loss Per Share    Without Waiver
										and Expense 											Reimbursement
Fund                                          2000               2000

  ---------------------------------------------------------------------------
  <S>                                    <C>                   <C>
  Global Media & Telecommunications Fund               $(0.09)          7.08%
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


                                                       Smith Barney Mutual Funds

                                                                              35

<PAGE>

  For a Class B share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:
<TABLE>
<CAPTION>

                                          2000/(1)/

---------------------------------------------------
<S>                                      <C>
Net asset value, beginning of period       $11.40

---------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                   (0.10)
 Net realized and unrealized loss           (0.83)

---------------------------------------------------
Total loss from operations                  (0.93)

---------------------------------------------------
Less distributions from:
 Net investment income                         --
 Net realized gains                            --

---------------------------------------------------
Total distributions                            --

---------------------------------------------------
Net asset value, end of period             $10.47

---------------------------------------------------
Total return                              (8.16)%**

---------------------------------------------------
Net assets, end of period (000's)          $5,212

---------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                              2.29%*
 Net investment loss                      (0.36)%*

---------------------------------------------------
Portfolio turnover rate                         3%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waivers
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                                Net Investment       Expense Ratio
                                 Loss Per Share    Without Waiver and Expense
  									Reimbursement
Fund                                   2000               2000

  ---------------------------------------------------------------------------
  <S>                                    <C>                   <C>
  Global Media & Telecommunications Fund  $(0.10)          7.85%*
</TABLE>
 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


Smith Barney Sector Series Inc.

36

<PAGE>

  For a Class L share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:
<TABLE>
<CAPTION>
<S>                                      <C>

                                         2000/(1)/

---------------------------------------------------
Net asset value, beginning of period       $11.40

---------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                   (0.10)
 Net realized and unrealized loss           (0.83)

---------------------------------------------------
Total loss from operations                  (0.93)

---------------------------------------------------
Less distributions from:
 Net investment income                         --
 Net realized gains                            --
---------------------------------------------------
Total distributions                            --

---------------------------------------------------
Net asset value, end of period             $10.47

---------------------------------------------------
Total return                                (8.16)%**

---------------------------------------------------
Net assets, end of period (000's)          $2,312

---------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                              2.28%*
 Net investment loss                      (0.40)%*

---------------------------------------------------
Portfolio turnover rate                         3%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waivers
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                                   Net Investment     Expense Ratio
                                    Loss Per Share    Without Waiver and
									                                           Expense Reimbursement
Fund                                           2000               2000

---------------------------------------------------------------------------
<S>                                    <C>                   <C>
Global Media & Telecommunications Fund               $(0.10)          7.85%*
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


                                                       Smith Barney Mutual Funds

                                                                              37

<PAGE>

Global Technology Fund

  For a Class A share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:

<TABLE>
<CAPTION>
                                           2000/(1)/

----------------------------------------------------
<S>                                      <C>
Net asset value, beginning of period       $ 11.40

----------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                    (0.11)
 Net realized and unrealized gain (loss)     (2.51)

----------------------------------------------------
Total loss from operations                   (2.62)

----------------------------------------------------
Less distributions from:
 Net investment income                          --
 Net realized gains                             --

----------------------------------------------------
Total distributions                             --

----------------------------------------------------
Net asset value, end of period             $  8.78

----------------------------------------------------
Total return                              (22.98)%**

----------------------------------------------------
Net assets, end of period (000's)          $ 1,206

----------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                               1.56%*
 Net investment income                       0.39%*

----------------------------------------------------
Portfolio turnover rate                          5%

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waivers
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                       Net Investment        Expense Ratio
                         Loss Per Share      Without Waiver and Expense
								                                        Reimbursement
Fund                           2000               2000

-----------------------------------------------------------
<S>                    <C>                   <C>
Global Technology Fund               $(0.11)         10.36%*
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


Smith Barney Sector Series Inc.

38

<PAGE>

  For a Class B share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:
<TABLE>
<CAPTION>
<S>                                      <C>

                                          2000/(1)/

----------------------------------------------------
Net asset value, beginning of period       $ 11.40

----------------------------------------------------
Loss from operations:
 Net investment loss/(2)/                    (0.16)
 Net realized and unrealized gain (loss)     (2.47)

----------------------------------------------------
Total loss from operations                   (2.63)

----------------------------------------------------
Less distributions from:
 Net investment income                          --
 Net realized gains                             --

----------------------------------------------------
Total distributions                             --

----------------------------------------------------
Net asset value, end of period             $  8.77

----------------------------------------------------
Total return                              (23.07)%**

----------------------------------------------------
Net assets, end of period (000's)          $ 1,503

----------------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                               2.29%*
 Net investment loss                       (1.15)%*

----------------------------------------------------
Portfolio turnover rate                         5 %

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waivers
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                       Net Investment       Expense Ratio
                         Loss Per Share     Without Waiver and Expense
								                                     Reimbursement
Fund                           2000               2000

-----------------------------------------------------------
<S>                    <C>                   <C>
Global Technology Fund               $(0.16)          11.08%
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


                                                       Smith Barney Mutual Funds

                                                                              39

<PAGE>

  For a Class L share of capital stock outstanding from August 31, 2000
  (inception date) through October 31:
<TABLE>
<CAPTION>
<S>                                <C>

                                    2000/(1)/

----------------------------------------------
Net asset value, beginning of period $ 11.40

----------------------------------------------
Loss from operations:
 Net investment loss/(2)/              (0.16)
 Net realized and unrealized loss      (2.47)

----------------------------------------------
Total loss from operations             (2.63)

----------------------------------------------
Less distributions from:
 Net investment income                    --
 Net realized gains                       --

----------------------------------------------
Total distributions                       --

----------------------------------------------
Net asset value, end of period       $  8.77

----------------------------------------------
Total return                        (23.07)%**

----------------------------------------------
Net assets, end of period (000's)    $ 2,383

----------------------------------------------
Ratios to average net assets:
 Expenses/(2)/                         2.28%*
 Net investment loss                 (1.23)%*

----------------------------------------------
Portfolio turnover rate                   5 %

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

/(1)/ Per share amounts calculated using the monthly average shares method.
/(2)/ Expense ratios and the per share net investment loss before fee waivers
    and expense reimbursement were as follows:

<TABLE>
<CAPTION>
                       Net Investment        Expense Ratio
                          Per Share          Without Waiver and Expense
								                                         Reimbursement
Fund                           2000               2000

-----------------------------------------------------------
<S>                    <C>                   <C>
Global Technology Fund               $(0.16)          11.08%*
</TABLE>

 *  Annualized.
**  Total return is not annualized, as it may not be representative of the
    total return for the year.


Smith Barney Sector Series Inc.

40

<PAGE>


                   (This page is intentionally left blank.)
<PAGE>


[LOGO]  Smith Barney

        Mutual Funds

        Your Serious Money. Professionally Managed./sm/

Smith Barney

Global Biotechnology Fund

Global Media & Telecommunications Fund

Global Technology Fund

Each an investment portfolio of Smith Barney Sector Series Inc.

Shareholder reports Annual and semiannual reports to shareholders provide
additional information about a fund's investments. These reports discuss the
market conditions and investment strategies that significantly affected the
fund's performance.

Each fund sends only one report to a household if more than one account has the
same address. Contact your Service Agent or the transfer agent if you do not
want this policy to apply to you.

Statement of additional information
The statement of additional information provides more detailed information
about a fund and is incorporated by reference into (is a legally part of) this
prospectus.

You can make inquiries about a fund or obtain shareholder reports or the
statement of additional information (without charge) by contacting your Service
Agent, by calling the fund's sub-transfer Agent, or by writing to the fund at
Smith Barney Mutual Funds, 7 World Trade Center, 39th Floor, New York, New York
10048.

Information about each fund (including the SAI) can be reviewed and copied at
the Securities and Exchange Commission's (the "Commission") Public Reference
Room in Washington D.C. In addition, information on the operation of the Public
Reference Room may be obtained by calling the Commission at 1-202-942-8090.
Reports and other information about each fund are available on the EDGAR
Database on the Commission's Internet site at http://www.sec.gov. Copies of
this information may be obtained for a duplicating fee by electronic request at
the following E-mail address: publicinfo@sec.gov, or by writing the
Commission's Public Reference Section, Washington, D.C. 20549-0102.

If someone makes a statement about a fund that is not in this prospectus, you
should not rely upon that information. Neither the funds nor the distributor is
offering to sell shares of a fund to any person to whom the fund may not
lawfully sell its shares.

Your Serious Money. Professionally Managed is a service mark of Salomon Smith
Barney Inc.

(Investment Company Act
file no. 811-04757)
FD 01978     2/01






February 28, 2001

STATEMENT OF ADDITIONAL INFORMATION

SMITH BARNEY SECTOR SERIES INC.
Smith Barney Financial Services Fund
Smith Barney Health Sciences Fund
Smith Barney Technology Fund

7 World Trade Center
New York, New York 10048
(800) 451-2010

This Statement of Additional Information ("SAI") is meant to
be read in conjunction with the combined prospectus of Smith
Barney Financial Services Fund ("Financial Services Fund"),
Smith Barney Health Sciences Fund ("Health Sciences Fund")
and Smith Barney Technology Fund ("Technology Fund") (each,
a "Fund") dated February 28, 2001, as amended or
supplemented from time to time (the "prospectus"), and is
incorporated by reference in its entirety into the
prospectus. Each Fund is a series of the Smith Barney Sector
Series Inc. (the "Company") which also offers three other
series: Smith Barney Global Biotechnology Fund, Smith Barney
Global Media & Telecommunications Fund and Smith Barney
Global Technology Fund. The prospectus and copies of other
information on the Funds may be obtained free of charge by
contacting a Salomon Smith Barney Financial Consultant, PFS
Investments Registered Representative, a broker/dealer,
financial intermediary, financial institution (each called a
"Service Agent") or by writing or calling the Company at the
address or telephone number above.

TABLE OF CONTENTS
Investment Objective and Management Policies	2
Risk Factors	8
Investment Restrictions	18
Directors and Executive Officers of the Company	20
Investment Management and Other Services	22
Portfolio Transactions	26
Portfolio Turnover	28
Purchase of Shares	28
Redemption of Shares	36
Valuation of Shares	39
Exchange Privilege	39
Performance Information	40
Dividends, Distributions and Taxes	42
Other Information About the Company	48
Financial Statements	49
Other Information	49
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES

The prospectus discusses each Fund's investment objective
and policies. This section contains supplemental information
concerning the types of securities and other instruments in
which each Fund may invest, the investment policies and
portfolio strategies each Fund may utilize and certain risks
associated with these investments, policies and strategies.
SSB Citi Fund Management LLC ("SSB Citi" or the "Manager")
serves as Investment Manager to each Fund. Citibank, N.A.,
through its Citibank Global Asset Management division
("CGAM" or the "Sub-Adviser"), an affiliate of the Manager,
serves as the sub-adviser to each Fund.

Financial Services Fund

Financial Services Fund seeks long-term capital appreciation
by investing primarily in common stocks. The Fund invests at
least 80% of its assets in securities of companies
principally engaged in providing financial services to
consumers and industry. These companies may include, for
example, commercial banks, savings and loan associations,
brokerage companies, insurance companies, real estate-
related companies, leasing companies, and consumer and
industrial finance companies.

Health Sciences Fund

Health Sciences Fund seeks long-term capital appreciation by
investing primarily in common stocks. The Fund invests at
least 80% of its assets in securities of companies
principally engaged in the design, manufacture, or sale of
products or services used for or in connection with health
care or medicine. These companies may include, for example,
pharmaceutical companies; companies involved in
biotechnology, medical diagnostic, biochemical or other
health care research and development; companies involved in
the operation of health care facilities; and other companies
involved in the design, manufacture, or sale of health care-
related products or services such as medical, dental and
optical products, hardware, insurance or services.

Technology Fund

Technology Fund seeks long-term capital appreciation by
investing its assets primarily in common stocks. The Fund
normally invests at least 80% of its assets in securities of
companies principally engaged in offering, using or
developing products, processes or services that will provide
or will benefit significantly from technological advances
and improvements. These companies may include, for example,
companies that develop, produce or distribute products or
services in the computer, semi-conductor, software,
electronics, media, communications, health care, and
biotechnology sectors.

Each Fund

Each fund may invest its assets in securities of foreign
issuers in addition to securities of domestic issuers.
Because each Fund is considered non-diversified, the Fund
may invest a significant percentage of its assets in a
single issuer.

In buying and selling securities for each fund, the
Subadviser relies on fundamental analysis of each issuer and
its potential for success in light of its current financial
condition and its industry position. Factors considered
include long-term growth potential, earnings estimates and
quality of management.

The Subadviser may lend each Fund's securities to broker-
dealers or other institutions to earn income for the Fund.
The Subadviser may, but is not required to, use various
techniques, such as buying and selling futures and options
contracts, to increase or decrease a Fund's exposure to
changing security prices or other factors that affect
security values. If the Subadviser's strategies do not work
as intended, a Fund may not achieve its objective.

Under normal market conditions, the majority of a Fund's
portfolio will consist of common stock, but it also may
contain money market instruments for cash management
purposes. Each Fund reserves the right, as a defensive
measure, to hold money market securities, including
repurchase agreements or cash, in such proportions as, in
the opinion of management, prevailing market or economic
conditions warrant. If a Fund takes a temporary defensive
position, it may be unable to achieve its investment goal.

Equity Securities.  Each Fund will normally invest at least
80% of its assets in equity securities, including primarily
common stocks and, to a lesser extent, securities
convertible into common stock and rights to subscribe for
common stock. Common stocks 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.

When-Issued Securities and Delayed-Delivery Transactions.
Each Fund may purchase securities on a "when-issued" basis,
for delayed delivery (i.e., payment or delivery occur beyond
the normal settlement date at a stated price and yield) or
on a forward commitment basis.  A Fund does not intend to
engage in these transactions for speculative purposes, but
only in furtherance of its investment goal.  These
transactions occur when securities are purchased or sold by
a Fund with payment and delivery taking place in the future
to secure what is considered an advantageous yield and price
to a Fund at the time of entering into the transaction.  The
payment obligation and the interest rate that will be
received on when-issued securities are fixed at the time the
buyer enters into the commitment. Because of fluctuations in
the value of securities purchased or sold on a when-issued,
delayed-delivery basis or forward commitment basis, the
prices obtained on such securities may be higher or lower
than the prices available in the market on the dates when
the investments are actually delivered to the buyers.

When the Fund agrees to purchase when-issued or delayed-
delivery securities, the Fund will set aside cash or liquid
securities equal to the amount of the commitment in a
segregated account on the Fund's books.  Normally, the
custodian will set aside portfolio securities to satisfy a
purchase commitment, and in such a case the Fund may be
required subsequently to place additional assets in the
segregated account in order to ensure that the value of the
account remains equal to the amount of the Fund's
commitment. The assets contained in the segregated account
will be marked-to-market daily.  It may be expected that the
Fund's net assets will fluctuate to a greater degree when it
sets aside portfolio securities to cover such purchase
commitments than when it sets aside cash.  When the Fund
engages in when-issued or delayed-delivery transactions, it
relies on the other party to consummate the trade.  Failure
of the seller to do so may result in the Fund's incurring a
loss or missing an opportunity to obtain a price considered
to be advantageous.

Foreign Securities.  Each Fund may invest in securities of
foreign issuers. Such investments involve certain risks not
ordinarily associated with investments in securities of
domestic issuers.  Such risks include currency exchange
control regulations and costs, the possibility of
expropriation, seizure, or nationalization of foreign
deposits, less liquidity and volume and more volatility in
foreign securities markets and the impact of political,
social, economic or diplomatic developments or the adoption
of other foreign government restrictions that might
adversely affect the payment of principal and interest on or
market value of securities.  If it should become necessary,
the Fund might encounter greater difficulties in invoking
legal processes abroad than would be the case in the United
States.  In addition, there may be less publicly available
information about a non-U.S. company, and non-U.S. companies
are not generally subject to uniform accounting and
financial reporting standards, practices and requirements
comparable to those applicable to U.S. companies.
Furthermore, some of these securities may be subject to
foreign brokerage and withholding taxes.

Each Fund may also invest in securities of foreign issuers
in the form of American Depository Receipts ("ADRs"),
European Depository Receipts ("EDRs") or similar securities
representing interests in the common stock of foreign
issuers.  ADRs are receipts, typically issued by a U.S. bank
or trust company, which evidence ownership of underlying
securities issued by a foreign corporation.  EDRs are
receipts issued in Europe which evidence a similar ownership
arrangement.  Generally, ADRs, in registered form, are
designed for use in the U.S. securities markets and EDRs are
designed for use in European securities markets.  The
underlying securities are not always denominated in the same
currency as the ADRs or EDRs. Although investment in the
form of ADRs or EDRs facilitates trading in foreign
securities, it does not mitigate the risks associated with
investing in foreign securities.  However, by investing in
ADRs or EDRs rather than directly in foreign issuers' stock,
a Fund can avoid currency risks during the settlement period
for either purchases or sales.  In general, there is a
large, liquid market in the United States for many ADRs and
EDRs.  The information available for ADRs and EDRs is
subject to the accounting, auditing and financial reporting
standards of the domestic market or exchange on which they
are traded, which standards are more uniform and more
exacting than those to which many foreign issuers may be
subject.

Investments in foreign securities incur higher costs than
investments in U.S. securities, including higher costs in
making securities transactions as well as foreign government
taxes which may reduce the investment return of the Fund.
In addition, foreign investments may include additional
risks associated with currency exchange rates, less complete
financial information about individual companies, less
market liquidity and political instability.

Currency Risks.  The U.S. dollar value of securities
denominated in a foreign currency will vary with changes in
currency exchange rates, which can be volatile.
Accordingly, changes in the value of the currency in which a
Fund's investments are denominated relative to the U.S.
dollar will affect the Fund's net asset value.  Exchange
rates are generally affected by the forces of supply and
demand in the international currency markets, the relative
merits of investing in different countries and the
intervention or failure to intervene of U.S. or foreign
governments and central banks.  However, currency exchange
rates may fluctuate based on factors intrinsic to a
country's economy.  Some emerging market countries also may
have managed currencies, which are not free floating against
the U.S. dollar.  In addition, emerging markets are subject
to the risk of restrictions upon the free conversion of
their currencies into other currencies.  Any devaluations
relative to the U.S. dollar in the currencies in which a
fund's securities are quoted would reduce the Fund's net
asset value per share.

Securities of Developing/Emerging Markets Countries.   A
developing or emerging markets country generally is
considered to be a country that is in the initial stages of
its industrialization cycle. Investing in the equity markets
of developing countries involves exposure to economic
structures that are generally less diverse and mature, and
to political systems that can be expected to have less
stability, than those of developed countries. Historical
experience indicates that the markets of developing
countries have been more volatile than the markets of the
more mature economies of developed countries; however, such
markets often have provided higher rates of return to
investors.

One or more of the risks discussed above could affect
adversely the economy of a developing market or a Fund's
investments in such a market.  The claims of many property
owners against those of governments may remain unsettled.
There can be no assurance that any investments that a Fund
might make in such emerging markets would be expropriated,
nationalized or otherwise confiscated at some time in the
future.  In such an event, the Fund could lose its entire
investment in the market involved.  Moreover, changes in the
leadership or policies of such markets could halt the
expansion or reverse the liberalization of foreign
investment policies now occurring in certain of these
markets and adversely affect existing investment
opportunities.

Economic and Monetary Union (EMU) EMU began on January 1,
1999 when 11 European countries adopted a single currency-
the Euro.  EMU may create new economic opportunities for
investors, such as lower interest rates, easier cross-border
mergers, acquisitions and similar restructurings, more
efficient distribution and product packaging and greater
competition.  Budgetary decisions remain in the hands of
each participating country, but are subject to each
country's comitment to avoid "excessive deficits" and other
more specific a budgetary criteria.  A European Central Bank
is responsible for setting the official interest rate within
the Euro zone.  EMU and the introduction of the Euro,
however, present unique risks and uncertainties for
investors in EMU-participating countries, including:  (i)
monetary and economic union on this scale has never before
been attempted; (ii) there is uncertainty whether
participating countries will remain committed to EMU in the
face of changing economic conditions; (iii) instability
within EMU may increase the volatility of European markets
and may adversely affect the prices of securities of
European issuers in the funds' portfolios; (iv) there is
uncertainty concerning the fluctuation of the Euro relative
to non-Euro currencies during the transition period from
January 1, 1999 and beyond; and (v) there is no assurance
that interest rate, tax and labor regimes of EMU-
participating countries will converge onver time.  These and
other factors may cause market disruption and could
adversely affect European securities and currencies held by
the funds.

Money Market Instruments. Each Fund may invest for temporary
defensive purposes in short-term corporate and government
bonds and notes and money market instruments.  Money market
instruments include: obligations issued or guaranteed by the
United States government, its agencies or instrumentalities
("U.S. government securities"); certificates of deposit,
time deposits and bankers' acceptances issued by domestic
banks (including their branches located outside the United
States and subsidiaries located in Canada), domestic
branches of foreign banks, savings and loan associations and
similar institutions; high grade commercial paper; and
repurchase agreements with respect to the foregoing types of
instruments. Certificates of deposit ("CDs") are short-term,
negotiable obligations of commercial banks. Time deposits
("TDs") are non-negotiable deposits maintained in banking
institutions for specified periods of time at stated
interest rates.  Bankers' acceptances are time drafts drawn
on commercial banks by borrowers, usually in connection with
international transactions.

Repurchase Agreements.  Each Fund may agree to purchase
securities from a bank or recognized securities dealer and
simultaneously commit to resell the securities to the bank
or dealer at an agreed-upon date and price reflecting a
market rate of interest unrelated to the coupon rate or
maturity of the purchased securities ("repurchase
agreements"). The Fund would maintain custody of the
underlying securities prior to their repurchase; thus, the
obligation of the bank or dealer to pay the repurchase price
on the date agreed to would be, in effect, secured by such
securities.  If the value of such securities were less than
the repurchase price, plus interest, the other party to the
agreement would be required to provide additional collateral
so that at all times the collateral is at least 102% of the
repurchase price plus accrued interest.  Default by or
bankruptcy of a seller would expose the Fund to possible
loss because of adverse market action, expenses and/or
delays in connection with the disposition of the underlying
obligations.  The financial institutions with which the Fund
may enter into repurchase agreements will be banks and non-
bank dealers of U.S. Government securities on the Federal
Reserve Bank of New York's list of reporting dealers, if
such banks and non-bank dealers are deemed creditworthy by
the Fund's Manager or the Subadviser. The Manager or the
Subadviser will continue to monitor creditworthiness of the
seller under a repurchase agreement, and will require the
seller to maintain during the term of the agreement the
value of the securities subject to the agreement to equal at
least 102% of the repurchase price (including accrued
interest).  In addition, the Manager or the Subadviser will
require that the value of this collateral, after transaction
costs (including loss of interest) reasonably expected to be
incurred on a default, be equal to 102% or greater than the
repurchase price (including accrued premium) provided in the
repurchase agreement or the daily amortization of the
difference between the purchase price and the repurchase
price specified in the repurchase agreement. The Manager or
the Subadviser will mark-to-market daily the value of the
securities.  Repurchase agreements are considered to be
loans by the Fund under the Investment Company Act of 1940,
as amended (the "1940 Act").
Reverse Repurchase Agreements.  Each Fund may enter into
reverse repurchase agreements which involve the sale of Fund
securities with an agreement to repurchase the securities at
an agreed-upon price, date and interest payment and have the
characteristics of borrowing.  Since the proceeds of
borrowings under reverse repurchase agreements are invested,
this would introduce the speculative factor known as
"leverage."  The securities purchased with the funds
obtained from the agreement and securities collateralizing
the agreement will have maturity dates no later than the
repayment date.  Generally the effect of such a transaction
is that the Fund can recover all or most of the cash
invested in the portfolio securities involved during the
term of the reverse repurchase agreement, while in many
cases it will be able to keep some of the interest income
associated with those securities.  Such transactions are
only advantageous if the Fund has an opportunity to earn a
greater rate of interest on the cash derived from the
transaction than the interest cost of obtaining that cash.
Opportunities to realize earnings from the use of the
proceeds equal to or greater than the interest required to
be paid may not always be available, and the Fund intends to
use the reverse repurchase technique only when the
Subadviser believes it will be advantageous to the Fund.
The use of reverse repurchase agreements may exaggerate any
interim increase or decrease in the value of the Fund's
assets.  The Fund's custodian bank will maintain a separate
account for the Fund with securities having a value equal to
or greater than such commitments.
Lending of Portfolio Securities.  Consistent with applicable
regulatory requirements, each Fund may lend portfolio
securities to brokers, dealers and other financial
organizations that meet capital and other credit
requirements or other criteria established by the Board.
The Fund will not lend portfolio securities to affiliates of
the Manager unless they have applied for and received
specific authority to do so from the Securities and Exchange
Commission ("SEC").  Loans of portfolio securities will be
collateralized by cash, letters of credit or U.S. Government
Securities, which are maintained at all times in an amount
equal to at least 102% of the current market value of the
loaned securities.  Any gain or loss in the market price of
the securities loaned that might occur during the term of
the loan would be for the account of the Fund.  From time to
time, the Fund may return a part of the interest earned from
the investment of collateral received for securities loaned
to the borrower and/or a third party that is unaffiliated
with the Fund and that is acting as a "finder."
By lending its securities, the Fund can increase its income
by continuing to receive interest and any dividends on the
loaned securities as well as by either investing the
collateral received for securities loaned in short-term
instruments or obtaining yield in the form of interest paid
by the borrower when U.S. Government Securities are used as
collateral.  Although the generation of income is not the
primary investment goal of the Fund, income received could
be used to pay the Fund's expenses and would increase an
investor's total return. The Fund will adhere to the
following conditions whenever its portfolio securities are
loaned: (i) the Fund must receive at least 102% cash
collateral or equivalent securities of the type discussed in
the preceding paragraph from the borrower; (ii) the borrower
must increase such collateral whenever the market value of
the securities rises above the level of such collateral;
(iii) the Fund must be able to terminate the loan at any
time; (iv) the Fund must receive reasonable interest on the
loan, as well as any dividends, interest or other
distributions on the loaned securities and any increase in
market value; (v) the Fund may pay only reasonable custodian
fees in connection with the loan; and (vi) voting rights on
the loaned securities may pass to the borrower, provided,
however, that if a material event adversely affecting the
investment occurs, the Board must terminate the loan and
regain the right to vote the securities.  Loan agreements
involve certain risks in the event of default or insolvency
of the other party including possible delays or restrictions
upon a Fund's ability to recover the loaned securities or
dispose of the collateral for the loan.
Borrowing.  Each Fund also may borrow for temporary or
emergency purposes, but not for leveraging purposes, in an
amount up to 331/3% of its total assets, and may pledge its
assets in connection with such borrowings. If a Fund borrows
money, its share price may be subject to greater fluctuation
until the borrowing is paid off. If a Fund makes additional
investments while borrowings are outstanding, this may be
considered a form of leverage.

Illiquid Securities.  Each Fund may invest up to an
aggregate amount of 15% of its net assets in illiquid
securities, which term includes securities subject to
contractual or other restrictions on resale and other
instruments that lack readily available markets.

RISK FACTORS

Financial Services Fund

This sector generally is subject to extensive governmental
regulation, which may change frequently.  In addition, the
profitability of businesses in financial services depends
heavily upon the availability and cost of money, and may
fluctuate significantly in response to changes in interest
rates, as well as changes in general economic conditions.
From time to time, severe competition may also affect the
profitability of financial services companies.

Most financial services companies are subject to extensive
governmental regulation which limits their activities and
may (as with insurance rate regulation) affect the ability
to earn a profit from a given line of business. Certain
financial services businesses are subject to intense
competitive pressures, including market share and price
competition. The removal of regulatory barriers to
participation in certain segments of the financial services
sector may also increase competitive pressures on different
types of firms. The availability and cost of funds to
financial services firms is crucial to their profitability.
Consequently, volatile interest rates and general economic
conditions can adversely affect their financial performance.

Financial services companies in foreign countries are
subject to similar regulatory and interest rate concerns.
In particular, government regulation in certain foreign
countries may include controls on interest rates, credit
availability, prices and currency movements. In some cases,
foreign governments have taken steps to nationalize the
operations of banks and other financial services companies.

The Subadviser believes that the deregulation of many
segments of the financial services sector provides new
opportunities for issuers in this sector. As new segments of
the financial services sector are opened to certain larger
financial services firms formerly prohibited from doing
business in these segments (such as national and money
center banks); certain established companies in these market
segments (such as regional banks or securities firms) may
become attractive acquisition candidates for the larger firm
seeking entrance into the segment. Typically, acquisitions
accelerate the capital appreciation of the shares of the
company to be acquired.

The Subadviser will seek to invest in those financial
services companies that it believes are well positioned to
take advantage of the ongoing changes in the financial
services sector. A financial services company may be well
positioned for a number of reasons. It may be an attractive
acquisition for another company wishing to strengthen its
presence in a line of business or a geographic region or to
expand into new lines of business or geographic regions, or
it may be planning a merger to strengthen its position in a
line of business or a geographic area.  The financial
services company may be engaged in a line or lines of
business experiencing or likely to experience strong
economic growth; it may be linked to a geographic region
experiencing or likely to experience strong economic growth
and may be actively seeking to participate in such growth;
or it may be expanding into financial services or geographic
regions previously unavailable to it (because of an easing
of regulatory constraints) in order to take advantage of new
market opportunities.

Health Sciences Fund

Many faster-growing health care companies have limited
operating histories and their potential profitability may be
dependent on regulatory approval of their products, which
increases the volatility of these companies' security
prices. Many of these activities are funded or subsidized by
governments; withdrawal or curtailment of this support could
lower the profitability and market prices of such companies.
Changes in government regulation could also have an adverse
impact.  Continuing technological advances may mean rapid
obsolescence of products and services.

Technology Fund

Many technological products and services are subject to
rapid obsolescence, which may lower the market value of the
securities of the companies in this sector.  Also, the
portfolio consists of faster-growing, more volatile
technology companies that the Subadviser believes to be
emerging leaders in their fields.  The market prices of
these companies tend to rise and fall more rapidly than
those of larger, more established companies.

Technology and Health Science Areas.  The Subadviser
believes that because of rapid advances in technology and
science, an investment in companies with business operations
in these areas will offer substantial opportunities for
long-term capital appreciation. Of course, prices of common
stocks of even the best managed, most profitable
corporations are subject to market risk, which means their
stock prices can decline. In addition, swings in investor
psychology or significant trading by large institutional
investors can result in price fluctuations. Industries
likely to be represented in the portfolio include computers,
networking and internetworking software, computer aided
design, telecommunications, media and information services,
medical devices and biotechnology. The Fund may also invest
in the stocks of companies that should benefit from the
commercialization of technological advances, although they
may not be directly involved in research and development.
The technology and science areas have exhibited and continue
to exhibit rapid growth, both through increasing demand for
existing products and services and the broadening of the
technology market. In general, the stocks of large
capitalized companies that are well established in the
technology market can be expected to grow with the market
and will frequently be found in the Fund's portfolio. The
expansion of technology and its related industries, however,
also provides a favorable environment for investment in
small to medium capitalized companies. The Fund's investment
policy is not limited to any minimum capitalization
requirement and the Fund may hold securities without regard
to the capitalization of the issuer. The Subadviser's
overall stock selection for the Fund is not based on the
capitalization or size of the company but rather on an
assessment of the company's fundamental prospects.

Companies in the rapidly changing fields of technology and
science face special risks. For example, their products or
services may not prove commercially successful or may become
obsolete quickly. The value of the Fund's shares may be
susceptible to factors affecting the technology and science
areas and to greater risk and market fluctuation than an
investment in a fund that invests in a broader range of
portfolio securities not concentrated in any particular
industry. As such, the Fund is not an appropriate investment
for individuals who are not long-term investors and who, as
their primary objective, require safety of principal or
stable income from their investments. The technology and
science areas may be subject to greater governmental
regulation than many other areas and changes in governmental
policies and the need for regulatory approvals may have a
material adverse effect on these areas. Additionally,
companies in these areas may be subject to risks of
developing technologies, competitive pressures and other
factors and are dependent upon consumer and business
acceptance as new technologies evolve.

Risks Associated with Particular Investments

Market Risk.  Equity stock prices vary and may fall, thus
reducing the value of a Fund's investment.  Certain stocks
selected for any Fund's portfolio may decline in value more
than the overall stock market.

Foreign Securities.  Investments in foreign and emerging
markets carry special risks, including currency, political,
regulatory and diplomatic risks. Each Fund has the ability
to invest more than 25% of their respective assets in the
securities of non-U.S. issuers.

Currency Risk.  A change in the exchange rate between U.S.
dollars and a foreign currency may reduce the value of a
Fund's investment in a security valued in the foreign
currency, or based on that currency value.

Political Risk.  Political actions, events or instability
may result in unfavorable changes in the value of a
security.

Regulatory Risk.  Government regulations may affect the
value of a security. In foreign countries, securities
markets that are less regulated than those in the U.S. may
permit trading practices that are not allowed in the U.S.

Diplomatic Risk.  A change in diplomatic relations between
the U.S. and a foreign country could affect the value or
liquidity of investments.

Liquidity Risk.  A Fund's portfolio is liquid if the Fund is
able to sell the securities it owns at a fair price within a
reasonable time. Liquidity is generally related to the
market trading volume for a particular security.
Investments in smaller companies or in foreign companies or
companies in emerging markets are subject to a variety of
risks, including potential lack of liquidity.

Smaller Capitalized Companies.  The Subadviser believes that
smaller capitalized companies generally have greater
earnings and sales growth potential than larger capitalized
companies. The level of risk will be increased to the extent
each Fund has significant exposure to smaller capitalized or
unseasoned companies (those with less than a three-year
operating history). Investments in smaller capitalized
companies may involve greater risks, such as limited product
lines, markets and financial or managerial resources. In
addition, less frequently traded securities may be subject
to more abrupt price movements than securities of larger
capitalized companies.

Risks of Using Derivative Instruments. In general terms, a
derivative instrument is one whose value depends on (or is
derived from) the value of an underlying asset, interest
rate or index. Options, futures and options on futures are
examples of derivative instruments. Derivative instruments
involve risks different from the direct investment in
underlying securities. These risks include imperfect
correlation between the value of the instruments and the
underlying assets; risks of default by the other party to
certain transactions; risks that the transactions may result
in losses that partially or completely offset gains in
portfolio positions; and risks that the transactions may not
be liquid.

Counterparty Risk.  This is a risk associated primarily with
repurchase agreements and some derivatives transactions.  It
is the risk that the other party in such a transaction will
not fulfill its contractual obligation to complete a
transaction with a Fund.

Lack of Timely Information Risk. Timely information about a
security or its issuer may be unavailable, incomplete or
inaccurate.  This risk is more common to smaller company
securities issued by foreign companies and companies in
emerging markets than it is to the securities of U.S.-based
companies.

Non-Diversified Classification.  Each Fund is classified as
a non-diversified fund under the 1940 Act which means the
Fund is not limited by the Act in the proportion of its
assets it may invest in the obligations of a single issuer.
As a result, the Funds may be subject to greater volatility
with respect to their portfolio securities than funds that
are more broadly diversified. Each Fund intends to conduct
its operations, however, so as to qualify as a "regulated
investment company" for purposes of the Internal Revenue
Code of 1986, as amended (the "Code"), which will relieve
the Fund of any liability for Federal income tax to the
extent its earnings are distributed to shareholders.  To
qualify as a regulated investment company, the Fund will,
among other things, limit its investments so that, at the
close of each quarter of the taxable year (a) not more than
25% of the market value of the Fund's total assets will be
invested in the securities of a single issuer and (b) with
respect to 50% of the market value of its total assets, not
more than 5% of the market value of its total assets will be
invested in the securities of a single issuer and the Fund
will not own more than 10% of the outstanding voting
securities of a single issuer.

Master/feeder fund structure.  The Board of Directors has
the discretion to retain the current distribution
arrangement for the Funds while investing their assets in a
master fund in a master/feeder fund structure.  A
master/feeder fund structure is one in which a fund (a
"feeder fund"), instead of investing directly in a portfolio
of securities, invests most or all of its investment assets
in a separate registered investment company (the "master
fund") with substantially the same investment objective and
policies as the feeder fund.  Such a structure permits the
pooling of assets of two or more feeder funds, preserving
separate identities or distribution channels at the feeder
fund level.  Based on the premise that certain of the
expenses of operating an investment portfolio are relatively
fixed, a larger investment portfolio may eventually achieve
a lower ratio of operating expenses to average net assets.
An existing investment company is able to convert to a
feeder fund by selling all of its investments, which
involves brokerage and other transaction costs and
realization of a taxable gain or loss, or by contributing
its assets to the master fund and avoiding transaction costs
and, if proper procedures are followed, the realization of
taxable gain or loss.

Options, Futures and Currency Strategies.  Each Fund may,
but is not required to, use forward currency contracts and
certain options and futures strategies to seek to increase
total return or hedge its portfolio, i.e., reduce the
overall level of investment risk normally associated with
the Fund.  There can be no assurance that such efforts will
succeed.

In order to assure that the Fund will not be deemed to be a
"commodity pool" for purposes of the Commodity Exchange Act,
regulations of the Commodity Futures Trading Commission
("CFTC") require that the Fund enter into transactions in
futures contracts and options on futures only (i) for bona
fide hedging purposes (as defined in CFTC regulations), or
(ii) for non-hedging purposes, provided the aggregate
initial margin and premiums on such non-hedging positions do
not exceed 5% of the liquidation value of the Fund's assets.
To attempt to hedge against adverse movements in exchange
rates between currencies, the Fund may enter into forward
currency contracts for the purchase or sale of a specified
currency at a specified future date.  Such contracts may
involve the purchase or sale of a foreign currency against
the U.S. dollar or may involve two foreign currencies.  The
Fund may enter into forward currency contracts either with
respect to specific transactions or with respect to its
portfolio positions.  For example, when the Subadviser
anticipates making a purchase or sale of a security, it may
enter into a forward currency contract in order to set the
rate (either relative to the U.S. dollar or another
currency) at which the currency exchange transaction related
to the purchase or sale will be made ("transaction
hedging").  Further, when the Subadviser believes a
particular currency may decline compared to the U.S. dollar
or another currency, the Fund may enter into a forward
contract to sell the currency the Subadviser expects to
decline in an amount approximating the value of some or all
of the Fund's securities denominated in that currency, or
when the Subadviser believes one currency may decline
against a currency in which some or all of the portfolio
securities held by the Fund are denominated, it may enter
into a forward contract to buy the currency expected to
decline for a fixed amount ("position hedging").  In this
situation, the Fund may, in the alternative, enter into a
forward contract to sell a different currency for a fixed
amount of the currency expected to decline where the
Subadviser believes the value of the currency to be sold
pursuant to the forward contract will fall whenever there is
a decline in the value of the currency in which portfolio
securities of the Fund are denominated ("cross hedging").
The Fund places (i) cash, (ii) U.S. Government securities or
(iii) equity securities or debt securities (of any grade) in
certain currencies provided such assets are liquid,
unencumbered and marked to market daily, or other high-
quality debt securities denominated in certain currencies in
a separate account of the Fund having a value equal to the
aggregate amount of the Fund's commitments under forward
contracts entered into with respect to position hedges and
cross-hedges.  If the value of the securities placed in a
separate account declines, additional cash or securities are
placed in the account on a daily basis so that the value of
the amount will equal the amount of the Fund's commitments
with respect to such contracts.

For hedging purposes, the Fund may write covered call
options and purchase put and call options on currencies to
hedge against movements in exchange rates and on debt
securities to hedge against the risk of fluctuations in the
prices of securities held by the Fund or which the
Subadviser intends to include in its portfolio.  The Fund
also may use interest rates futures contracts and options
thereon to hedge against changes in the general level in
interest rates.

The Fund may write call options on securities and currencies
only if they are covered, and such options must remain
covered so long as the Fund is obligated as a writer.  A
call option written by the Fund is "covered" if the Fund
owns the securities or currency underlying the option or has
an absolute and immediate right to acquire that security or
currency without additional cash consideration (or for
additional cash consideration held in a segregated account
on the Fund's books) upon conversion or exchange of other
securities or currencies held in its portfolio.  A call
option is also covered if the Fund holds on a share-for-
share basis a call on the same security or holds a call on
the same currency as the call written where the exercise
price of the call held is equal to less than the exercise
price of the call written or greater than the exercise price
of the call written if the difference is maintained by the
Fund in cash, Treasury bills or other high-grade, short-term
obligations in a segregated account on the Fund's books.

The Fund may purchase put and call options in anticipation
of declines in the value of portfolio securities or
increases in the value of securities to be acquired.  If the
expected changes occur, the Fund may be able to offset the
resulting adverse effect on its portfolio, in whole or in
part, through the options purchased. The risk assumed by the
Fund in connection with such transactions is limited to the
amount of the premium and related transaction costs
associated with the option, although the Fund may lose such
amounts if the prices of securities underlying the options
do not move in the direction or to the extent anticipated.

Although the portfolio may not use forward currency
contracts, options and futures, the use of any of these
strategies would involve certain investment risks and
transaction costs. These risks include: dependence on the
Subadviser's ability to predict movements in the prices of
individual  securities, fluctuations in the general fixed-
income markets and movements in interest rates and currency
markets, imperfect correlation between movements in the
price of currency, options, futures contracts or options
thereon and movements in the price of the currency or
security hedged or used for cover; the fact that skills and
techniques needed to trade options, futures contracts and
options thereon or to use forward currency contracts are
different from those needed to select the securities in
which the Fund invests; and lack of assurance that a liquid
market will exist for any particular option, futures
contract or option thereon at any particular time.

Over-the-counter options in which the Fund may invest differ
from exchange traded options in that they are two-party
contracts, with price and other terms negotiated between
buyer and seller, and generally do not have as much market
liquidity as exchange-traded options.  The Fund may be
required to treat as illiquid over-the-counter options
purchased and securities being used to cover certain written
over-the-counter options.

Options on Securities.  As discussed more generally above,
each Fund may engage in writing covered call options. Each
Fund may also purchase put options and enter into closing
transactions. The principal reason for writing covered call
options on securities is to attempt to realize, through the
receipt of premiums, a greater return than would be realized
on the securities alone. In return for a premium, the writer
of a covered call option forgoes the right to any
appreciation in the value of the underlying security above
the strike price for the life of the option (or until a
closing purchase transaction can be effected). Nevertheless,
the call writer retains the risk of a decline in the price
of the underlying security. Similarly, the principal reason
for writing covered put options is to realize income in the
form of premiums. The writer of a covered put option accepts
the risk of a decline in the price of the underlying
security. The size of the premiums the Fund may receive may
be adversely affected as new or existing institutions,
including other investment companies, engage in or increase
their option-writing activities.

Options written by the Fund will normally have expiration
dates between one and six months from the date written. The
exercise price of the options may be below, equal to, or
above the current market values of the underlying securities
when the options are written. In the case of call options,
these exercise prices are referred to as "in-the-money,"
"at-the-money" and "out-of-the-money," respectively.

The Fund may write (a) in-the-money call options when the
Subadviser expects the price of the underlying security to
remain flat or decline moderately during the option period,
(b) at-the-money call options when the Subadviser expects
the price of the underlying security to remain flat or
advance moderately during the option period and (c) out-of-
the-money call options when the Subadviser expects that the
price of the security may increase but not above a price
equal to the sum of the exercise price plus the premiums
received from writing the call option. In any of the
preceding situations, if the market price of the underlying
security declines and the security is sold at this lower
price, the amount of any realized loss will be offset wholly
or in part by the premium received. Out-of-the-money, at-
the-money and in-the-money put options (the reverse of call
options as to the relation of exercise price to market
price) may be utilized in the same market environments as
such call options are used in equivalent transactions.

So long as the obligation of the Fund as the writer of an
option continues, the Fund may be assigned an exercise
notice by the broker-dealer through which the option was
sold, requiring it to deliver, in the case of a call, or
take delivery of, in the case of a put, the underlying
security against payment of the exercise price. This
obligation terminates when the option expires or the Fund
effects a closing purchase transaction. The Fund can no
longer effect a closing purchase transaction with respect to
an option once it has been assigned an exercise notice. To
secure its obligation to deliver the underlying security
when it writes a call option, or to pay for the underlying
security when it writes a put option, the Fund will be
required to deposit in escrow the underlying security or
other assets in accordance with the rules of the Options
Clearing Corporation ("Clearing Corporation") or similar
clearing corporation and the securities exchange on which
the option is written.

An option position may be closed out only where there exists
a secondary market for an option of the same series on a
recognized securities exchange or in the over-the-counter
market.  The Fund expects to write options only on national
securities exchanges or in the over-the-counter market.  The
Fund may purchase put options issued by the Clearing
Corporation or in the over-the-counter market.

The Fund may realize a profit or loss upon entering into a
closing transaction. In cases in which the Fund has written
an option, it will realize a profit if the cost of the
closing purchase transaction is less than the premium
received upon writing the original option and will incur a
loss if the cost of the closing purchase transaction exceeds
the premium received upon writing the original option.
Similarly, when the Fund has purchased an option and engages
in a closing sale transaction, whether it recognizes a
profit or loss will depend upon whether the amount received
in the closing sale transaction is more or less than the
premium the Fund initially paid for the original option plus
the related transaction costs.

Although the Fund generally will purchase or write only
those options for which the Manager and/or the Subadviser
believes there is an active secondary market so as to
facilitate closing transactions, there is no assurance that
sufficient trading interest to create a liquid secondary
market on a securities exchange will exist for any
particular option or at any particular time, and for some
options no such secondary market may exist. A liquid
secondary market in an option may cease to exist for a
variety of reasons. In the past, for example, higher than
anticipated trading activity or order flow, or other
unforeseen events, have at times rendered certain of the
facilities of the Clearing Corporation and national
securities exchanges inadequate and resulted in the
institution of special procedures, such as trading
rotations, restrictions on certain types of orders or
trading halts or suspensions in one or more options. There
can be no assurance that similar events, or events that may
otherwise interfere with the timely execution of customers'
orders, will not recur. In such event, it might not be
possible to effect closing transactions in particular
options. If, as a covered call option writer, the Fund is
unable to effect a closing purchase transaction in a
secondary market, it will not be able to sell the underlying
security until the option expires or it delivers the
underlying security upon exercise.

Securities exchanges generally have established limitations
governing the maximum number of calls and puts of each class
which may be held or written, or exercised within certain
periods, by an investor or group of investors acting in
concert (regardless of whether the options are written on
the same or different securities exchanges or are held,
written or exercised in one or more accounts or through one
or more brokers).  It is possible that the Fund and other
clients of the Manager or the Subadviser and certain of
their affiliates may be considered to be such a group.  A
securities exchange may order the liquidation of positions
found to be in violation of these limits, and it may impose
certain other sanctions.

In the case of options written by the Fund that are deemed
covered by virtue of the Fund's holding convertible or
exchangeable preferred stock or debt securities, the time
required to convert or exchange and obtain physical delivery
of the underlying common stocks with respect to which the
Fund has written options may exceed the time within which
the Fund must make delivery in accordance with an exercise
notice. In these instances, the Fund may purchase or
temporarily borrow the underlying securities for purposes of
physical delivery. By so doing, the Fund will not bear any
market risk because the Fund will have the absolute right to
receive from the issuer of the underlying security an equal
number of shares to replace the borrowed stock, but the Fund
may incur additional transaction costs or interest expenses
in connection with any such purchase or borrowing.

Although the Subadviser will attempt to take appropriate
measures to minimize the risks relating to the Fund's
writing of call options and purchasing of put and call
options, there can be no assurance that the Fund will
succeed in its option-writing program.

Stock Index Options.  As described generally above, each
Fund may purchase put and call options and write call
options on domestic stock indexes listed on domestic
exchanges in order to realize its investment objective of
long-term capital appreciation or for the purpose of hedging
its portfolio. A stock index fluctuates with changes in the
market values of the stocks included in the index. Some
stock index options are based on a broad market index such
as the New York Stock Exchange Composite Index or the
Canadian Market Portfolio Index, or a narrower market index
such as the Standard & Poor's 100. Indexes also are based on
an industry or market segment such as the American Stock
Exchange Oil and Gas Index or the Computer and Business
Equipment Index.

Options on stock indexes are generally similar to options on
stock except that the delivery requirements are different.
Instead of giving the right to take or make delivery of
stock at a specified price, an option on a stock index gives
the holder 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 exercise, multiplied by
(b) a fixed "index multiplier." Receipt of this cash amount
will depend upon the closing level of the stock index upon
which the option is based being greater than, in the case of
a call, or less than, in the case of a put, the exercise
price of the option. The amount of cash received will be
equal to such difference between the closing price of the
index and the exercise price of the option expressed in
dollars or a foreign currency, as the case may be, times a
specified multiple. The writer of the option is obligated,
in return for the premium received, to make delivery of this
amount. The writer may offset its position in stock index
options prior to expiration by entering into a closing
transaction on an exchange or it may let the option expire
unexercised.

The effectiveness of purchasing or writing stock index
options as a hedging technique will depend upon the extent
to which price movements in the portion of the securities
portfolio of the Fund correlate with price movements of the
stock index selected. Because the value of an index option
depends upon movements in the level of the index rather than
the price of a particular stock, whether the Fund will
realize a gain or loss from the purchase or writing of
options on an index depends upon movements in the level of
stock prices in the stock market generally or, in the case
of certain indexes, in an industry or market segment, rather
than movements in the price of a particular stock.
Accordingly, successful use by the Fund of options on stock
indexes will be subject to the Manager's and/or the
Subadviser's ability to predict correctly movements in the
direction of the stock market generally or of a particular
industry. This requires different skills and techniques than
predicting changes in the price of individual stocks.

Futures Contracts and Options on Futures Contracts.  As
described generally above, each Fund may invest in stock
index futures contracts and options on futures contracts
traded on a domestic exchange or board of trade.  Futures
contracts provide for the future sale by one party and
purchase by another party of a specified amount of a
specific security at a specified future time and at a
specified price.  The primary purpose of entering into a
futures contract by the Fund is to protect the Fund from
fluctuations in the value of securities without actually
buying or selling the securities.  The Fund may enter into
futures contracts and options on futures to seek higher
investment returns when a futures contract is priced more
attractively than stocks comprising a benchmark index, to
facilitate trading or to reduce transaction costs.  The Fund
will enter into futures contracts and options only on
futures contracts that are traded on a domestic exchange and
board of trade.  Assets committed to futures contracts will
be segregated on the Fund's books to the extent required by
law.

The purpose of entering into a futures contract by the Fund
is to protect the Fund from fluctuations in the value of
securities without actually buying or selling the
securities. For example, in the case of stock index futures
contracts, if the Fund anticipates an increase in the price
of stocks it intends to purchase at a later time, the Fund
could enter into contracts to purchase the stock index
(known as taking a "long" position) as a temporary
substitute for the purchase of stocks. If an increase in the
market occurs that influences the stock index as
anticipated, the value of the futures contracts increases
and thereby serves as a hedge against the Fund's not
participating in a market advance. The Fund then may close
out the futures contracts by entering into offsetting
futures contracts to sell the stock index (known as taking a
"short" position) as it purchases individual stocks. The
Fund can accomplish similar results by buying securities
with long maturities and selling securities with short
maturities. But by using futures contracts as an investment
tool to reduce risk, given the greater liquidity in the
futures market, it may be possible to accomplish the same
result more easily and more quickly.

No consideration will be paid or received by the Fund upon
the purchase or sale of a futures contract. Initially, the
Fund will be required to deposit with the broker an amount
of cash or cash equivalents equal to approximately 1% to 10%
of the contract amount (this amount is subject to change by
the exchange or board of trade on which the contract is
traded and brokers or members of such board of trade may
charge a higher amount). This amount is known as "initial
margin" and is in the nature of a performance bond or good
faith deposit on the contract which is returned to the Fund,
upon termination of the futures contract, assuming all
contractual obligations have been satisfied. Subsequent
payments, known as "variation margin," to and from the
broker, will be made daily as the price of the index or
securities underlying the futures contract fluctuates,
making the long and short positions in the futures contract
more or less valuable, a process known as "marking-to-
market." In addition, when the Fund enters into a long
position in a futures contract or an option on a futures
contract, it must deposit into a segregated account with the
Fund's custodian an amount of cash or cash equivalents equal
to the total market value of the underlying futures
contract, less amounts held in the Fund's commodity
brokerage account at its broker. At any time prior to the
expiration of a futures contract, the Fund may elect to
close the position by taking an opposite position, which
will operate to terminate the Fund's existing position in
the contract.

There are several risks in connection with the use of
futures contracts as a hedging device. Successful use of
futures contracts by the Fund is subject to the ability of
the Subadviser to predict correctly movements in the stock
market or in the direction of interest rates. These
predictions involve skills and techniques that may be
different from those involved in the management of
investments in securities. In addition, there can be no
assurance that there will be a perfect correlation between
movements in the price of the securities underlying the
futures contract and movements in the price of the
securities that are the subject of the hedge. A decision of
whether, when and how to hedge involves the exercise of
skill and judgment, and even a well-conceived hedge may be
unsuccessful to some degree because of market behavior or
unexpected trends in market behavior or interest rates.

Positions in futures contracts may be closed out only on the
exchange on which they were entered into (or through a
linked exchange) and no secondary market exists for those
contracts. In addition, although a Fund intends to enter
into futures contracts only if there is an active market for
the contracts, there is no assurance that an active market
will exist for the contracts at any particular time. Most
futures exchanges and boards of trade limit the amount of
fluctuation permitted in futures contract prices during a
single trading day. Once the daily limit has been reached in
a particular contract, no trades may be made that day at a
price beyond that limit. It is possible that futures
contract prices could move to the daily limit for several
consecutive trading days with little or no trading, thereby
preventing prompt liquidation of futures positions and
subjecting some futures traders to substantial losses. In
such event, and in the event of adverse price movements, the
Fund would be required to make daily cash payments of
variation margin; in such circumstances, an increase in the
value of the portion of the portfolio being hedged, if any,
may partially or completely offset losses on the futures
contract. As described above, however, no assurance can be
given that the price of the securities being hedged will
correlate with the price movements in a futures contract and
thus provide an offset to losses on the futures contract.
INVESTMENT RESTRICTIONS

The investment restrictions numbered 1 through 7 below and
each Fund's investment objective have been adopted by the
Company as fundamental policies of each Fund.  Under the
1940 Act, a fundamental policy may not be changed with
respect to a Fund without the vote of a majority of the
outstanding voting securities of the Fund.  Majority is
defined in the 1940 Act as the lesser of (a) 67% or more of
the shares present at a Fund meeting, if the holders of more
than 50% of the outstanding shares of the Fund are present
or represented by proxy, or (b) more than 50% of outstanding
shares.

Under the investment restrictions adopted by the Company
with respect to each Fund, each Fund will not:
1.	Purchase or sell the securities of any issuer, if, as
a result of such purchase or sale, less than 25% of the
assets of the Fund would be invested in the securities of
issuers principally engaged in the business activities
having the specific characteristics denoted by the Fund.

2.	Borrow money, except that (a) the Fund may borrow from
banks for temporary or emergency (not leveraging) purposes,
including the meeting of redemption requests which might
otherwise require the untimely disposition of securities,
and (b) the Fund may, to the extent consistent with its
investment policies, enter into reverse repurchase
agreements, forward roll transactions and similar investment
strategies and techniques.  To the extent that it engages in
transactions described in (a) and (b), the Fund will be
limited so that no more than 331/3% of the value of its
total assets (including the amount borrowed), valued at the
lesser of cost or market, less liabilities (not including
the amount borrowed) valued at the time the borrowing is
made, is derived from such transactions.

3.	Issue "senior securities" as defined in the 1940 Act
and the rules, regulations and orders thereunder, except as
permitted under the 1940 Act and the rules, regulations and
orders thereunder.

4.	Make loans.  This restriction does not apply to: (a)
the purchase of debt obligations in which the Fund may
invest consistent with its investment objectives and
policies; (b) repurchase agreements; and (c) loans of its
portfolio securities, to the fullest extent permitted under
the 1940 Act.

5.	Purchase or sell real estate, real estate mortgages,
commodities or commodity contracts, but this restriction
shall not prevent the Fund from (a) investing in securities
of issuers engaged in the real estate business or the
business of investing in real estate (including interests in
limited partnerships owning or otherwise engaging in the
real estate business or the business of investing in real
estate) and securities which are secured by real estate or
interests therein;  (b) holding or selling real estate
received in connection with securities it holds or held;
(c)  trading in futures contracts and options on futures
contracts (including options on currencies to the extent
consistent with the Fund's investment objective and
policies);  or (d) investing in real estate investment trust
securities.

6.	Engage in the business of underwriting securities
issued by other persons, except to the extent that the Fund
may technically be deemed to be an underwriter under the
Securities Act of 1933, as amended, in disposing of
portfolio securities.

7.	Purchase or otherwise acquire any illiquid security
except as permitted under the 1940 Act for open-end
investment companies, which currently permits up to 15% of
the Fund's net assets to be invested in illiquid securities.

If any percentage restriction described above is complied
with at the time of an investment, a later increase or
decrease in percentage resulting from a change in values or
assets will not constitute a violation of such restriction.

DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

The Directors and executive officers of the Company,
together with information as to their principal business
occupations during the past five years, are shown below.
Each Director who is an "interested person" of each Fund, as
defined in the 1940 Act, is indicated by an asterisk.

HERBERT BARG (Age 77).  Director
Private Investor.  Director or trustee of 16 investment
companies associated with Citigroup Inc. ("Citigroup").  His
address is 273 Montgomery Avenue, Bala Cynwyd, Pennsylvania,
19004.

*ALFRED J. BIANCHETTI (Age 78). Director
 Retired; formerly Senior Consultant to Dean Witter Reynolds
Inc.  Director or trustee of 11 investment companies
associated with Citigroup.  His address is 19 Circle End
Drive, Ramsey, New Jersey 07466.

MARTIN BRODY (Age 79). Director
Consultant, HMK Associates.  Retired Vice Chairman of the
Board of Restaurant Associates Corp.  Director or trustee of
20 investment companies associated with Citigroup.  His
address is c/o HMK Associates, 30 Columbia Turnpike, Florham
Park, New Jersey 07932.

DWIGHT B. CRANE (Age 63). Director
Professor, Harvard Business School.  Director or trustee of
23 investment companies associated with Citigroup.  His
address is c/o Harvard Business School, Soldiers Field Road,
Boston, Massachusetts 02163.

BURT N. DORSETT (Age 70). Director
Managing Partner of the investment counseling firm Dorsett
McCabe Management, Inc.  Director of Research Corporation
Technologies, Inc., a nonprofit patent clearing and
licensing firm.  Director or trustee of 11 investment
companies associated with Citigroup.  His address is 201
East 62nd Street, New York, New York 10021.


ELLIOT S. JAFFE (Age 74). Director
Chairman of the Board and President of The Dress Barn, Inc.
Director or trustee of 11 investment companies associated
with Citigroup.  His address is 30 Dunnigan Drive, Suffern,
New York 10021.

STEPHEN E. KAUFMAN (Age 69). Director
Attorney.  Director or trustee of 13 investment companies
associated with Citigroup.  His address is 277 Park Avenue,
New York, New York 10172.

JOSEPH J. McCANN (Age 70). Director
Financial Consultant.  Retired Financial Executive, Ryan
Homes, Inc.  Director or trustee of 11 investment companies
associated with Citigroup.  His address is 200 Oak Park
Place, Pittsburgh, Pennsylvania 15243.

*HEATH B. McLENDON (Age 67).  Chairman of the Board,
President and Chief Excutive Officer.  Managing Director of
Salomon Smith Barney Inc. ("Salomon Smith Barney"),
President of SSB Citi and Travelers Investment Adviser, Inc.
("TIA"); Chairman or Co-Chairman of the Board of 77
investment companies associated with Citigroup.  His address
is 7 World Trade Center, New York, New York 10048.

CORNELIUS C. ROSE, JR. (Age 68). Director
President, Cornelius C. Rose Associates, Inc., financial
consultants, and Chairman and Director of Performance
Learning Systems, an educational consultant.  Director or
trustee of 11 investment companies associated with
Citigroup.  His address is Meadowbrook Village, Building 4,
Apt. 6, West Lebanon, New Hampshire 03784.

LEWIS E. DAIDONE (Age 43). Director
Senior Vice President and Treasurer.  Managing Director of
Salomon Smith Barney, Chief Financial Officer of the Smith
Barney Mutual funds; Director and Senior Vice President of
SSB Citi and TIA; Senior Vice President and Treasurer of 83
investment companies associated with Citigroup.  His address
is 125 Broad Street, New York, New York 10004.

IRVING DAVID (Age 40). Controller
Director of Salomon Smith Barney. Controller or Assistant
Treasurer of 43 investment companies associated with
Citigroup; Formerly Assistant Treasurer of First Investment
Management Company; His address is 125 Broad Street, New
York, New York 10004.

[PAUL BROOK (Age 47). Controller
Director of Salomon Smith Barney; from 1997-1998 Managing
Director of AMT Capital Services Inc.; prior to 1997 Partner
with Ernst & Young LLP; Controller or Assistant Treasurer of
43 investment companies associated with Citigroup.]

CHRISTINA T. SYDOR (Age 50).  Secretary
Managing Director of Salomon Smith Barney. General Counsel
and Secretary of SSB Citi and TIA; Secretary of 61
investment companies associated with Citigroup.

As of February 21, 2001, the Company's Directors and
officers of each Fund, as a group, owned less than 1% of the
outstanding shares of common stock of the Company.  As of
February 21, 2001 to the knowledge of the funds and the
board of trustees, no single shareholder or group (as the
term is used in Section 13(d) of the Securities Act of 1934)
beneficially owned or owner of record more than 5% of the
outstanding shares of the fund with the exception of the
following:

FUND
CLASS
SHARES HELD
PERCENT
NAME
ADDRESS
Financial
Services Fund

A
107,910.9
24
9.46*
PFS Shareholder
Services
Attn: Jay Barnhill
3100 Breckinridge
Blvd.
Duluth, GA 30199
Financial
Services Fund

B
112,802.8
92
5.02*
PFS Shareholder
Services
Attn: Jay Barnhill
3100 Breckinridge
Blvd.
Duluth, GA 30199
Health
Sciences Fund

A
129,291.1
25
9.75*
PFS Shareholder
Services
Attn: Jay Barnhill
3100 Breckinridge
Blvd.
Duluth, GA 30199
Health
Sciences Fund

B
150,352.6
52
6.30*
PFS Shareholder
Services
Attn: Jay Barnhill
3100 Breckinridge
Blvd.
Duluth, GA 30199
Technology
Fund

A
401,316.3
15
6.90*
PFS Shareholder
Services
Attn: Jay Barnhill
3100 Breckinridge
Blvd.
Duluth, GA 30199
* The Company believes that this entity is not the
beneficial owners of shares held of record by them.

No officer, Director or employee of Salomon Smith Barney or
any of its affiliates receives any compensation from the
Company for serving as an officer or director of the
Company.  The Company pays each Director who is not an
officer, director or employee of Salomon Smith Barney or any
of its affiliates a fee of $6000 per annum plus $250 per in-
person meeting and $100 per telephonic meeting. All
Directors are reimbursed for travel and out-of-pocket
expenses incurred to attend such meetings. During the fiscal
period ended October 31, 2000, such expenses totaled $9,737.

The following table shows the compensation paid by the
Company and other Smith Barney Mutual Funds to each Director
during the Company's last fiscal year.  None of the officers
of the Company received any compensation from the Company
for such period.  The Company does not pay retirement
benefits to its Directors and officers. Officers and
interested Directors of the Company are compensated by
Salomon Smith Barney.






Name of Person


Aggregate
Compensat
ion
From
Company+
Total
Pension or
Retirement
Benefits
Accrued
As part of
Company
Expenses

Compensation
from Company
and Fund
Complex
Paid to
Directors

Number of
Funds for
Which
Director
Serves
Within
Fund Complex

Herbert Barg**
Alfred
Bianchetti* **
Martin Brody**
Dwight B.
Crane**
Burt N.
Dorsett**
Elliot S.
Jaffe**
Stephen E.
Kaufman**
Joseph J.
McCann**
Heath B.
McLendon*
Cornelius C.
Rose, Jr.**

$3,158.00
$3,058.00
$2,970.00
$3,058.00
$3,158.00
$2,983.00
$3,158.00
$3,158.00
     $
0.00
$3,158.00

$0
 0
 0
 0
 0
 0
 0
 0
 0
 0

$116,075.00
        $
58,900.00
$132,950.00
$153,175.00
        $
59,500.00
        $
58,700.00
        $
114,000.00
        $
59,500.00
        $
0.00
        $
59,500.00

16
11
20
23
11
11
13
11
77
11
*	Designates an "interested" Director.
**	Designates member of Audit Committee.

Upon attainment of age 80, Company Directors are required to
change to emeritus status.  Directors Emeritus are entitled
to serve in emeritus status for a maximum of 10 years,
during which time they are paid 50% of the annual retainer
fee and meeting fees otherwise applicable to Company
Directors, together with reasonable out-of-pocket expenses
for each meeting attended.  Directors Emeritus may attend
meetings but have no voting rights.  During the Company's
last fiscal year, aggregate compensation paid to Directors
Emeritus was $1,500.

INVESTMENT MANAGEMENT AND OTHER SERVICES

Investment Manager and Subadviser

SSB Citi serves as investment manager to the Funds pursuant
to a written agreement with the fund (an "Management
Agreement").  SSB Citi is a wholly owned subsidiary of
Salomon Smith Barney Holdings Inc. ("Holdings").  Holdings
is a wholly owned subsidiary of Citigroup, which is located
at 1 Citicorp Center, 153 East 53rd Street, New York, New
York 10028.  SSB Citi was incorporated on March 12, 1968
under the laws of Delaware and converted to a Delaware
limited liability company in September 1999.  The Management
Agreement was approved by the Board of Directors, including
a majority of the Directors who are not "interested persons"
of the Company or the Manager ("Independent Directors"). SSB
Citi (through its predecessor entities) has been in the
investment counseling business since 1968 and renders
investment advice to a wide variety of individual,
institutional and investment company clients that had
aggregate assets under management as of February 12, 2000 in
excess of $144 billion.

CGAM provides discretionary and non-discretionary portfolio
management services to a wide variety of individual and
institutional accounts, including, but not limited to, banks
or thrift institutions, retirement plans, pension and
profit-entities, registered investment companies and
unregistered domestic and offshore funds. The Sub-Advisory
Agreement was approved by the Board of Directors, including
a majority of the Directors who are not "interested persons"
of the Company or the Manager. CGAM is located at 100 First
Stamford Place, Stamford, Connecticut.

The Manager and the Subadviser pay the salaries of all
officers and employees who are employed by both it and the
Company, and maintain office facilities for the Company.  In
addition to those services, the Manager furnishes the
Company with statistical and research data, clerical help
and accounting, data processing, bookkeeping, internal
auditing and legal services and certain other services
required by the Company, prepares reports to the fund's
shareholders and prepares tax returns, reports to and
filings with the Securities and Exchange Commission (the
"SEC") and state Blue Sky authorities.  The Manager and
Subadviser bear all expenses in connection with the
performance of their services.
The Company bears expenses incurred in its operations,
including: taxes, interest, brokerage fees and commissions,
if any; fees of Directors who are not officers, directors,
shareholders or employees of Salomon Smith Barney or one of
its affiliates, SEC fees and state Blue Sky qualification
fees; charges of custodians; transfer and dividend
disbursing agent fees; certain insurance premiums; outside
auditing and legal expenses; costs of maintaining corporate
existence; costs of investor services (including allocated
telephone and personnel expenses); costs of preparing and
printing of prospectuses for regulatory purposes and for
distribution to existing shareholders; costs of
shareholders' reports and shareholder meetings; and meetings
of the officers or Board of Directors of the Company.

As compensation for investment management services, the
respective Fund pays the Manager the annual investment
management fee described below (based on a percentage of the
fund's average daily net assets):

Financial Services Fund:	0.80%
Health Sciences Fund:		0.80%
Technology Fund:		0.95%

For the period ended October 31, 2000*, the Funds paid
investment advisory fees to SSB Citi as follows:
Financial Services Fund
$   260,242
Health Sciences Fund
     261,782
Technology Fund
  1,106,818
*	The Manager of the Financial Services Fund, Health
Sciences Fund and Technology Fund waived $170,543,
$136,709 and $96,394 of its management fee,
respectively.  The administrative fees have been
included in the total for management fees.

The Manager has agreed to waive a portion of the fees
otherwise payable to it by certain of the Company's Funds so
that Class A, Class B and Class L share's expenses do not
exceed 1.50%, 2.25% and 2.25%, respectively, of each Fund's
average daily net assets.  The Manager may change or
eliminate this management fee waiver and/or voluntary
expense limitation at any time.

As compensation for investment sub-advisory services, the
Manager pays the sub-adviser the fee described below (based
on a percentage of the Fund's average daily net assets):

Financial Services Fund:	0.50%
Health Sciences Fund:		0.50%
Technology Fund:		0.65%

For the period ended October 31, 2000, the Manager paid
investment subadvisory fees to the Subadviser as follows:
Financial Services Fund
$     80,699
Health Sciences Fund
     125,073
Technology Fund
  1,010,424

Custodian and Sub-administration

State Street Bank and Trust Company ("State Street"), whose
principal business address is 225 Franklin Street, Boston,
Massachusetts, 02110, serves as the custodian of each Fund's
assets pursuant to a custodian agreement (the "Custody
Contract") with the Company. State Street is also the
custodian with respect to the custody of foreign securities
held by the Funds. Under the Custody Contract, State Street
(i) holds and transfers portfolio securities on account of
each Fund, (ii) accepts receipts and makes disbursements of
money on behalf of each Fund, (iii) collects and receives
all income and other payments and distributions on account
of each Fund's securities and (iv) makes periodic reports to
the Board of Directors concerning the Funds' operations.
State Street also serves as sub-administrator for each Fund,
pursuant to a written agreement (the "Agreement") with the
Manager and each Fund.

Under the Agreement, State Street has agreed to oversee the
computation of each Fund's net asset value, net income and
realized capital gains, if any; furnish statistical and
research data, clerical services, and stationery and office
supplies; prepare and file various reports with the
appropriate regulatory agencies; and prepare various
materials required by the SEC.

Transfer Agent and Sub-Transfer Agent

Citi Fiduciary Trust Company (the "transfer agent") located
at 125 Broad Street, New York, New York 10004, serves as
each Fund's transfer agent. Under the transfer agency
agreement, the transfer agent maintains the shareholder
account records for the Fund, handles certain communications
between shareholders and the Fund and distributes dividends
and distributions payable by the Fund. For these services,
the transfer agent receives a monthly fee computed on the
basis of the number of shareholder accounts it maintains for
the Fund during the month and is reimbursed for out-of-
pocket expenses.

PFPC Global Fund Services ("PFPC") located at P.O. Box 9699,
Providence, Rhode Island 02940, serves as a sub-transfer
agent of each Fund. Under the sub-transfer agency agreement,
the PFPC maintains the shareholder account records for the
Fund, handles certain communications between shareholders
and the Fund and distributes dividends and distributions
payable by the Fund. For these services, PFPC receives a
monthly fee from the transfer agent computed on the basis of
the number of shareholder accounts it maintains for the Fund
during the month and is reimbursed for out-of-pocket
expenses.

Each Fund has also engaged the services of PFS Shareholder
Services ("PFS Shareholder Services") as a sub-transfer
agent for PFS Accounts.  PFS Shareholder Services is located
at 3100 Breckinridge Blvd, Bldg 200, Duluth, Georgia 30099-
0062.

Auditors

KPMG LLP, independent auditors, 757 Third Avenue, New York,
New York 10017, have been selected to serve as auditors of
the Company and to render opinions on each Fund's financial
statements for the fiscal year ended October 31, 2001.

Counsel

Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New
York 10019, serves as counsel to the Company and each Fund.
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York,
New York, 10038 serves as counsel to the directors who are
not "interested persons" of the Company.

Distributors

Effective June 5, 2000, the Company on behalf of each Fund
has entered into an agreement with Salomon Smith Barney
located at 388 Greenwich Street, New York, New York 10013 and
PFS Distributors, Inc. ("PFS Distributors"), located at 3120
Breckinridge Blvd., Duluth, Georgia 30099 to distribute each
Fund's shares on a best efforts basis pursuant to
distribution agreements. Prior to June 5, 2000, CFBDS, Inc.
served as the Company's distributor.

When payment is made by the investor before the settlement
date, unless otherwise noted by the investor, the funds will
be held as a free credit balance in the investor's brokerage
account and Salomon Smith Barney may benefit from the
temporary use of the funds.  The Company's Board of
Directors has been advised of the benefits to Salomon Smith
Barney resulting from these settlement procedures and will
take such benefits into consideration when reviewing the
Investment Management Agreement for continuance.

For the fiscal year ended October 31, 2000, Salomon Smith
Barney and/or PFS Distributors incurred distribution expenses
for advertising, printing and mailing prospectuses, support
services and overhead expenses, to Salomon Smith Barney
Financial Consultants or PFS Investments Registered
Representatives and for accruals for interest on the excess
of Salomon Smith Barney and/or PFS expenses incurred in the
distribution of the fund's shares over the sum of the
distribution fees and Deferred Sales Charge received by
Salomon Smith Barney and/or PFSDI are expressed in the
following table:



Fund Name

Financial
Consultant
Compensatio
n


Branch
Expenses


Advertisin
g
Expenses


Printin
g
Expense
s


Interes
t
Expense
s


Other
Expenses
Financial
Services
Fund
$1,529,065
$
435,385
$   68,669
$3,278
$10,315
N/A
Health
Sciences
Fund
  1,545,848

408,811

64,482
  2,600

11,746
N/A
Technology
Fund
  4,643,118

1,271,48
3
   210,176
  8,566

(6,532)
N/A
Initial Sales Charges
For the 2000 fiscal period, the aggregate dollar amount of
commissions on Class A and Class L shares received by
Salomon Smith Barney were as follows:
	Class A Shares
	For the period ended October 31, 2000:
Financial Services Fund
$   219,000
Health Sciences Fund
     255,000
Technology Fund
  1,020,000



	Class B Shares
	For the period ended October 31, 2000:
Financial Services Fund
$   68,000
Health Sciences Fund
     78,000
Technology Fund
     95,000

Class L Shares
	For the period ended October 31, 2000:
Financial Services Fund
$   262,000
Health Sciences Fund
     224,000
Technology Fund
     800,000

Deferred Sales Charge (paid to Salomon Smith Barney)

	Class A Shares
	For the period ended October 31, 2000:
Financial Services Fund
$
1,000
Health Sciences Fund

2,000
Technology Fund

0

	Class B Shares
	For the period ended October 31, 2000:
Financial Services Fund
$     16,000
Health Sciences Fund

19,000
Technology Fund

97,000

	Class L Shares
	For the period ended October 31, 2000:
Financial Services Fund
$     13,000
Health Sciences Fund

8,000
Technology Fund

27,000


Distribution Arrangements

To compensate Salomon Smith Barney for the services it
provides and for the expense it bears under the Distribution
Agreement, each Fund has adopted a services and distribution
plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act.
Under the Plan, the Fund pays Salomon Smith Barney a service
fee, accrued daily and paid monthly, calculated at the
annual rate of 0.25% of the value of the Fund's average
daily net assets attributable to the Class A, Class B and
Class L shares. In addition, the Fund pays Salomon Smith
Barney a distribution fee with respect to the Class B and
Class L shares primarily intended to compensate Salomon
Smith Barney for its initial expense of paying Financial
Consultants a commission upon sales of those shares. The
Class B and Class L distribution fee is calculated at the
annual rate of 0.75% of the value of the Fund's average
daily net assets attributable to the shares of the
respective Class.

Under its terms, the Plan continues from year to year,
provided such continuance is approved annually by vote of
the Board of Directors, including a majority of the
directors who are not interested persons of the Fund and who
have no direct or indirect financial interest in the
operation of the Plan or in the Distribution Agreement (the
"independent directors").  The Plan may not be amended to
increase the amount of the service and distribution fees
without shareholder approval, and all amendments of the Plan
also must be approved by the directors including all of the
independent directors in the manner described above.  The
Plan may be terminated with respect to a Class at any time,
without penalty, by vote of a majority of the independent
directors or, with respect to the Fund, by vote of a
majority of the outstanding voting securities of the Fund
(as defined in the 1940 Act).  Pursuant to the Plan, Salomon
Smith Barney will provide the Board of Directors with
periodic reports of amounts expended under the Plan and the
purpose for which such expenditures were made.

The only classes of shares being offered for sale through
PFS Distributors are Class A shares and Class B shares.
Pursuant to the Plan (described above), PFS Distributors is
paid an annual service fee with respect to Class A and Class
B shares of the fund sold through PFS Distributors at the
annual rate of 0.25% of the average daily net assets of the
respective class.  PFS Distributors is also paid an annual
distribution fee with respect to Class B shares at the
annual rate of 0.75% of the average daily net assets
attributable to that Class.  Class B shares that
automatically convert to Class A shares eight years after
the date of original purchase will no longer be subject to a
distribution fee. The fees are paid to PFS Distributors,
which in turn, pays PFS Investments Inc. ("PFS Investments")
to pay its PFS Investments Registered Representatives for
servicing shareholder accounts and, in the case of Class B
shares, to cover expenses primarily intended to result in
the sale of those shares.  These expenses include:
advertising expenses; the cost of printing and mailing
prospectuses to potential investors; payments to and
expenses of PFS Investments Registered Representatives and
other persons who provide support services in connection
with the distribution of shares; interest and/or carrying
charges; and indirect and overhead costs of PFS Investments
associated with the sale of fund shares, including lease,
utility, communications and sales promotion expenses.

The payments to PFS Investments Registered Representatives
for selling shares of a class include a commission or fee
paid by the investor or PFS at the time of sale and, with
respect to Class A and Class B shares, a continuing fee for
servicing shareholder accounts for as long as a shareholder
remains a holder of that class.  PFS Investments Registered
Representatives may receive different levels of compensation
for selling different classes of shares.

PFS Investments may be deemed to be an underwriter for
purposes of the Securities Act of 1933. From time to time,
PFS or its affiliates may also pay for certain non-cash
sales incentives provided to PFS Investments Registered
Representatives.  Such incentives do not have any effect on
the net amount invested.  In addition to the reallowances
from the applicable public offering price described above,
PFS may from time to time, pay or allow additional
reallowances or promotional incentives, in the form of cash
or other compensation to PFS Investments Registered
Representatives who sell shares of the fund.

Service Fees and Distribution Fees

Class A Shares
For the period ended October 31, 2000:
Financial Services Fund
$     16,244
Health Sciences Fund

19,436
Technology Fund

67,882

Class B Shares
For the period ended October 31, 2000:
Financial Services Fund
$   126,651
Health Sciences Fund
     130,323
Technology Fund

464,979

Class L Shares
For the period ended October 31, 2000:
Financial Services Fund
$   133,676
Health Sciences Fund
     119,162
Technology Fund
     428,565

Code of Ethics

Pursuant to Rule 17j-1 of the 1940 Act, the Company on
behalf of each Fund, the Manager, the sub-adviser and
principal underwriter have adopted a code of ethics that
permits personnel to invest in securities for their own
accounts, including securities that may be purchased or held
by the fund.  All personnel must place the interests of
clients first and avoid activities, interests and
relationships that might interfere with the duty to make
decisions in the best interests of the clients.  All
personal securities transactions by employees must adhere to
the requirements of the code and must be conducted in such a
manner as to avoid any actual or potential conflict of
interest, the appearance of such a conflict, or the abuse of
an employee's position of trust and responsibility. A copy
of the Company's Code of Ethics is on file with the SEC.

PORTFOLIO TRANSACTIONS

The Subadviser arranges for the purchase and sale of each
Fund's securities and selects brokers and dealers (including
Salomon Smith Barney) which in its best judgment provide
prompt and reliable execution at favorable prices and
reasonable commission rates.  The Subadviser may select
brokers and dealers that provide it with research services
and may cause the Fund to pay such brokers and dealers
commissions which exceed those other brokers and dealers may
have charged, if it views the commissions as reasonable in
relation to the value of the brokerage and/or research
services.  In selecting a broker, including Salomon Smith
Barney, for a transaction, the primary consideration is
prompt and effective execution of orders at the most
favorable prices. Subject to that primary consideration,
dealers may be selected for research statistical or other
services to enable the Subadviser or its affiliates to
supplement its own research and analysis.

Decisions to buy and sell securities for a Fund are made by
the Subadviser, subject to the overall supervision and
review of the Company's Board of Directors. Portfolio
securities transactions for a Fund are effected by or under
the supervision of the Manager.

Transactions on stock exchanges involve the payment of
negotiated brokerage commissions. There is generally no
stated commission in the case of securities traded in the
over-the-counter market, but the price of those securities
includes an undisclosed commission or mark-up. Over-the-
counter purchases and sales are transacted directly with
principal market makers except in those cases in which
better prices and executions may be obtained elsewhere. The
cost of securities purchased from underwriters includes an
underwriting commission or concession, and the prices at
which securities are purchased from and sold to dealers
include a dealer's mark-up or mark-down.

In executing portfolio transactions and selecting brokers or
dealers, it is the Fund's policy to seek the best overall
terms available. The Subadviser, in seeking the most
favorable price and execution, considers all factors it
deems relevant, including, for example, the price, the size
of the transaction, the reputation, experience and financial
stability of the broker-dealer involved and the quality of
service rendered by the broker-dealer in other transactions.
The Subadviser receives research, statistical and quotation
services from several broker-dealers with which it places
the Fund's portfolio transactions. It is possible that
certain of the services received primarily will benefit one
or more other accounts for which the Subadviser exercises
investment discretion. Conversely, the Fund may be the
primary beneficiary of services received as a result of
portfolio transactions effected for other accounts. The sub-
adviser's fee under the management agreement is not reduced
by reason of its receiving such brokerage and research
services. The Company's Board of Directors, in its
discretion, may authorize the Manager to cause the Fund to
pay a broker that provides brokerage and research services
to the Manager a commission in excess of that which another
qualified broker would have charged for effecting the same
transaction. Salomon Smith Barney will not participate in
commissions from brokerage given by the Fund to other
brokers or dealers and will not receive any reciprocal
brokerage business resulting therefrom.

In accordance with Section 17(e) of the 1940 Act and Rule
17e-1 thereunder, the Company's Board of Directors has
determined that any portfolio transaction for the Fund may
be executed through Salomon Smith Barney or an affiliate of
Salomon Smith Barney if, in the Manager's judgment, the use
of Salomon Smith Barney or an affiliate is likely to result
in price and execution at least as favorable as those of
other qualified brokers and if, in the transaction, Salomon
Smith Barney or the affiliate charges the Fund a commission
rate consistent with those charged by Salomon Smith Barney
or an affiliate to comparable unaffiliated customers in
similar transactions. In addition, under SEC rules, Salomon
Smith Barney may directly execute such transactions for the
Fund on the floor of any national securities exchange,
provided: (a) the Board of Directors has expressly
authorized Salomon Smith Barney to effect such transactions;
and (b) Salomon Smith Barney annually advises the Fund of
the aggregate compensation it earned on such transactions.

Even though investment decisions for a Fund are made
independently from those of the other accounts managed by
the Subadviser, investments of the kind made by the Fund
also may be made by those other accounts. When the Fund and
one or more accounts managed by the Subadviser are prepared
to invest in, or desire to dispose of, the same security,
available investments or opportunities for sales will be
allocated in a manner believed by the Subadviser to be
equitable. In some cases, this procedure may adversely
affect the price paid or received by a Fund or the size of
the position obtained for or disposed of by a Fund.

A Fund will not purchase securities during the existence of
any underwriting or selling group relating to the
securities, of which the Manager or any affiliates is a
member, except to the extent permitted by the SEC.  Under
certain circumstances, the Fund may be at a disadvantage
because of this limitation in comparison with other Funds
that have similar investment objectives but that are not
subject to a similar limitation.









Portfolio







Total
Brokerage
Commissions





Commissions
paid to
Salomon
Smith
Barney and
Affiliates



% of Total
Brokerage
Commissions
paid to
Salomon
Smith
Barney and
Affiliates

% of Total
Dollar
Amount of
Transaction
s Involving
Commissions
Paid to
Salomon
Smith
Barney and
Affiliates

Financial Services
Fund
$115,898
$ 0
0%
0%
Health Sciences Fund
89,249
$ 0
0%
0%
Technology Fund
156,606
$ 0
0%
0%

PORTFOLIO TURNOVER

Each Fund's portfolio turnover rate (the lesser of purchases
or sales of portfolio securities during the year, excluding
purchases or sales of short-term securities, divided by the
monthly average value of portfolio securities) is generally
not expected to exceed 100%. The rate of turnover will not
be a limiting factor, however, when a Fund deems it
desirable to sell or purchase securities.
The Subadviser may cause the Fund to sell or purchase
securities to ensure compliance with the Fund's investment
policies.

For the fiscal period ended October 31, 2000, the portfolio
turnover rates were as follows:

Financial Services Fund
26%
Health Sciences Fund
26%
Technology Fund
24%
PURCHASE OF SHARES

General.  Each Fund offers four Classes of shares: Classes
A, B, L, and Y.  Class A and Class L shares are sold to
investors with an initial sales charge.  Class B shares are
sold without an initial sales charge but are subject to a
deferred sales charge payable upon certain redemptions.
Class L shares are also subject to a deferred sales charge
payable upon certain redemptions.  Class Y shares are sold
without an initial sales charge or a deferred sales charge
and are available only to investors investing a minimum of
$15,000,000. See the prospectus for a discussion of factors
to consider in selecting which Class of shares to purchase

Investors in Class A, Class B, and Class L  shares may open
an account by making an initial investment in the Fund of at
least $1,000 for each account, or $250 for an IRA or a Self-
Employed Retirement Plan. Investors in Class Y shares may
open an account by making an initial investment of
$15,000,000.  Subsequent investments of at least $50 may be
made for all classes. For participants in retirement plans
qualified under Section 403(b)(7) or Section 401(a) of the
Internal Revenue Code of 1986, as amended (the "Code"), the
minimum initial and subsequent investment requirement for
Class A, Class B, and Class L shares and the subsequent
investment requirement for all Classes in the Fund is $25.
For shareholders purchasing shares of the Fund through the
Systematic Investment Plan on a monthly basis, the minimum
initial investment requirement for Class A, Class B, and
Class L shares and the subsequent investment requirement for
all Classes is $25.  For shareholders purchasing shares of
the Fund through the Systematic Investment Plan on a
quarterly basis, the minimum initial investment requirement
for Class A, Class B, and  Class L shares and the subsequent
investment requirement for all Classes is $50.  There are no
minimum investment requirements in Class A shares for
employees of Citigroup and its subsidiaries, including
Salomon Smith Barney, unit holders who invest distributions
from a Unit Investment Trust ("UIT") sponsored by Salomon
Smith Barney, directors or trustees of any of the Smith
Barney Mutual Funds, and their spouses and children. The
Funds reserve the right to waive or change minimums, to
decline any order to purchase their shares and to suspend
the offering of shares from time to time. Shares purchased
will be held in the shareholder's account by the applicable
a sub-transfer agent.  Share certificates are issued only
upon a shareholder's written request to the applicable sub-
transfer agent.
Salomon Smith Barney Accounts.  Purchases of shares of each
Fund must be made through a brokerage account maintained
with a Service Agent. In addition, certain investors,
including qualified retirement plans and certain other
institutional investors, may purchase shares directly from a
Fund through the transfer agent. When purchasing shares of a
Fund, investors must specify whether the purchase is for
Class A, Class B, Class L, or Class Y shares. Salomon Smith
Barney and other broker/dealers may charge their customers
an annual account maintenance fee in connection with a
brokerage account through which an investor purchases or
holds shares. Accounts held directly at PFPC are not subject
to a maintenance fee.

PFS Investments Accounts. Each Fund offers two Classes of
shares to investors purchasing through PFS Investments:
Class A shares and Class B shares. Initial purchases of
shares of each Fund must be made through a PFS Investments
Registered Representative by completing the appropriate
application found in the Prospectus. The completed
application should be forwarded to PFS Shareholder Services,
P.O. Box 105033, Atlanta, Georgia 30348. Checks drawn on
foreign banks must be payable in U.S. dollars and have the
routing number of the U.S. bank encoded on the check.
Subsequent investments may be sent directly to PFS
Shareholder Services.  In processing applications and
investments, the PFS Shareholder Services acts as agent for
the investor and for PFS Investments and also as agent for
the Distributor, in accordance with the terms of the
Prospectus.  If Citi Fiduciary Trust Company  (the "Transfer
Agent") ceases to act as such, a successor company named by
the Fund will act in the same capacity so long as the
account remains open.

Shares purchased will be held in the shareholder's account
by PFS Shareholder Services. Share certificates are issued
only upon a shareholder's written request to PFS Shareholder
Services. A shareholder who has insufficient funds to
complete any purchase, will be charged a fee of $30 per
returned purchase by PFS Shareholder Services.

Investors in Class A and Class B shares may open an account
by making an initial investment of at least $1,000 for each
account in each Class (except for Systematic Investment Plan
accounts), or $250 for an IRA or a Self-Employed Retirement
Plan in a Fund. Subsequent investments of at least $50 may
be made for each Class. For participants in retirement plans
qualified under Section 403(b)(7) or Section 401(a) of the
Code, the minimum initial investment requirement for Class A
and Class B shares and the subsequent investment requirement
for each Class in the Fund is $25. There are no minimum
investment requirements in Class A shares for employees of
Citigroup and its subsidiaries, including Salomon Smith
Barney, Directors or Trustees of any of the Smith Barney
Mutual Funds, and their spouses and children. The Fund
reserves the right to waive or change minimums, to decline
any order to purchase its shares and to suspend the offering
of shares from time to time.  Purchase orders received by
the transfer agent or PFS Shareholder Services prior to the
close of regular trading on the NYSE, on any day a Fund
calculates its net asset value, are priced according to the
net asset value determined on that day.

Upon completion of certain automated systems, initial
purchases of Fund shares may be made by wire.  The minimum
investment that can be made by wire is $10,000. Before
sending the wire, the PFS Investments Registered
Representative must contact PFS Shareholder Services at
(800) 665-8677 to obtain proper wire instructions.  Once an
account is open, a shareholder may make additional
investments by wire.  The shareholder should contact PFS
Shareholder Services at (800) 544-5445 to obtain proper wire
instructions.

Upon completion of certain automated systems, shareholders
who establish telephone transaction authority on their
account and supply bank account information will be able to
make additions to their accounts at any time.  Shareholders
should contact PFS Shareholder Services at (800) 544-5445
between 8:00 a.m. and 8:00 p.m. eastern time any day that
the NYSE is open.  If a shareholder does not wish to allow
telephone subsequent investments by any person in his
account, he should decline the telephone transaction option
on the account application.  The minimum telephone
subsequent investment is $250 up to a maximum of $10,000.
By requesting a subsequent purchase by telephone, you
authorize PFS Shareholder Services to transfer funds from
the bank account provided for the amount of the purchase.  A
shareholder that has insufficient funds to complete the
transfer will be charged a fee of up to $30 by PFS
Shareholder Services.  A shareholder who places a stop
payment on a transfer or the transfer is returned because
the account has been closed, will also be charged a fee of
up to $30 by PFS Shareholder Services.  Subsequent
investments by telephone may not be available if the
shareholder cannot reach PFS Shareholder Services whether
because all telephone lines are busy or for any other
reason; in such case, a shareholder would have to use a
Fund's regular subsequent investment procedure described
above.

PFS may pay its Registered Representatives an amount equal
to 0.40% of the amount invested if the purchase represents
redemption proceeds from an investment company distributed
by an entity other than PFS Investments. In order to obtain
such discounts, the purchaser must provide sufficient
information at the time of purchase to permit verification
that the purchase would qualify for the elimination of the
sales charge.

In addition, Class A shares of a Fund may be purchased at
net asset value by the PFS Primerica Corporation Savings and
Retirement Plan (the ''Primerica Plan'') for its
participants, subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended
(''ERISA''). Class A shares so purchased are purchased for
investment purposes and may not be resold except by
redemption or repurchase by or on behalf of the Primerica
Plan. Class A shares are also offered at net asset value to
accounts opened for shareholders by PFS Investments
Registered Representatives where the amounts invested
represent the redemption proceeds from investment companies
distributed by an entity other than PFS, if such redemption
has occurred no more than 60 days prior to the purchase of
shares of a Fund, and the shareholder paid an initial sales
charge and was not subject to a deferred sales charge on the
redeemed account. Class A shares are offered at net asset
value to such persons because of anticipated economies in
sales efforts and sales related expenses. A Fund may
terminate, or amend the terms of, offering shares of the
Fund at net asset value to such persons at any time. PFS may
pay PFS Investments Registered Representatives through whom
purchases are made at net asset value an amount equal to
0.40% of the amount invested if the purchase represents
redemption proceeds from an investment company distributed
by an entity other than PFS. Contact PFS Shareholder
Services at (800) 544-5445 for further information and
appropriate forms.

An Account Transcript is available at a shareholder's
request, which identifies every financial transaction in an
account since it opened.  To defray administrative expenses
involved with providing multiple years worth of information,
there is a $15 charge for each Account Transcript requested.
Additional copies of tax forms are available at the
shareholder's request.  A $10 fee for each tax form will be
assessed.

Additional information regarding PFS Shareholder Services
may be obtained by contacting the Client Services Department
at (800) 544-5445.

Additional General Information

Systematic Investment Plan.  Shareholders may make additions
to their accounts at any time by purchasing shares through a
service known as the Systematic Investment Plan.  Under the
Systematic Investment Plan, shareholders can invest at least
$25 on a monthly basis or at least $50 on a quarterly basis(
not available to PFS accounts)  to charge the regular bank
account or other financial institution indicated by the
shareholder, to provide systematic additions to the
shareholder's fund account.  A shareholder who has
insufficient funds to complete the transfer will be charged
a fee of up to $25 by Salomon Smith Barney or PFS
Investments. The Systematic Investment Plan also authorizes
Salomon Smith Barney to apply cash held in the shareholder's
Salomon Smith Barney brokerage account or redeem the
shareholder's shares of a Smith Barney money market fund to
make additions to the account. Additional information is
available from the fund or a Service Agent.

Sales Charge Alternatives

The following classes of shares are available for purchase.
See the Prospectus for a discussion of factors to consider
in selecting which Class of shares to purchase.

Class A Shares.  Class A shares of each Fund are sold to
investors at the public offering price, which is the net
asset value plus an initial sales charge as follows:

Sales Charge




Amount of
Investment

% of Offering
Price

% of Amount
Invested
Dealers'
Reallowance as %
of Offering Price
Less than $25,000
5.00%
5.26%
4.50%
$  25,000 -
49,999
4.25
4.44
3.83
    50,000 -
99,999
3.75
3.90
3.38
    100,000 -
249,999
3.25
3.36
2.93
    250,000 -
499,999
2.75
2.83
2.48
    500,000 -
999,000
2.00
2.04
1.80
  1,000,000 or
more
0
0
Up to 1.00*
*	A distributor pays up to 1.00% to a Service Agent.

Purchases of Class A shares of $1,000,000 or more will be
made at net asset value without any initial sales charge,
but will be subject to a deferred sales charge of 1.00% on
redemptions made within 12 months of purchase.  The deferred
sales charge on Class A shares is payable to Salomon Smith
Barney, which compensates Salomon Smith Barney Financial
Consultants and other dealers whose clients make purchases
of $1,000,000 or more.  The deferred sales charge is waived
in the same circumstances in which the deferred sales charge
applicable to Class B and Class L shares is waived.  See
"Deferred Sales Charge Alternatives" and "Waivers of
Deferred Sales Charge."

Members of the selling group may receive up to 90% of the
sales charge and may be deemed to be underwriters of the
fund as defined in the 1933 Act.  The reduced sales charges
shown above apply to the aggregate of purchases of Class A
shares of a Fund made at one time by "any person," which
includes an individual and his or her immediate family, or a
trustee or other fiduciary of a single trust estate or
single fiduciary account.

Class B Shares.  Class B shares are sold without an initial
sales charge but are subject to a deferred sales charge
payable upon certain redemptions.  See "Deferred Sales
Charge Provisions" below.

Class L Shares.  Class L shares are sold with an initial
sales charge of 1.00% (which is equal to 1.01% of the amount
invested) and are subject to a deferred sales charge payable
upon certain redemptions.  See "Deferred Sales Charge
Provisions" below.  Until June 22, 2001 purchases of Class L
shares by investors who were holders of Class C shares of
other Smith Barney Mutual Funds on June 12, 1998 will not be
subject to the 1% initial sales charge.

Class Y Shares.  Class Y shares are sold without an initial
sales charge or deferred sales charge and are available only
to investors investing a minimum of $15,000,000 (except for
purchases of Class Y shares (i) of the International All Cap
Growth Portfolio, for which the minimum initial investment
is $5,000,000 and (ii) by Smith Barney Allocation Series
Inc., for which there is no minimum purchase amount).

Sales Charge Waivers and Reductions

Initial Sales Charge Waivers.  Purchases of Class A shares
may be made at net asset value without a sales charge in the
following circumstances: (a) sales to (i) Board Members and
employees of Citigroup and its subsidiaries and any
Citigroup affiliated funds including the Smith Barney Mutual
Funds (including retired Board Members and employees); the
immediate families of such persons (including the surviving
spouse of a deceased Board Member or employee); and to a
pension, profit-sharing or other benefit plan for such
persons and (ii) employees of members of the National
Association of Securities Dealers, Inc., provided such sales
are made upon the assurance of the purchaser that the
purchase is made for investment purposes and that the
securities will not be resold except through redemption or
repurchase; (b) offers of Class A shares to any other
investment company to effect the combination of such company
with the Fund by merger, acquisition of assets or otherwise;
(c) purchases of Class A shares by any client of a newly
employed Salomon Smith Barney Financial Consultant (for a
period up to 90 days from the commencement of the Financial
Consultant's employment with Salomon Smith Barney), on the
condition the purchase of Class A shares is made with the
proceeds of the redemption of shares of a mutual fund which
(i) was sponsored by the Financial Consultant's prior
employer, (ii) was sold to the client by the Financial
Consultant and (iii) was subject to a sales charge; (d)
purchases by shareholders who have redeemed Class A shares
in the Fund (or Class A shares of another Smith Barney
Mutual Fund that is offered with a sales charge) and who
wish to reinvest their redemption proceeds in the Fund,
provided the reinvestment is made within 60 calendar days of
the redemption; (e) purchases by accounts managed by
registered investment advisory subsidiaries of Citigroup;
(f) direct rollovers by plan participants of distributions
from a 401(k) plan offered to employees of Citigroup or its
subsidiaries (Note: subsequent investments will be subject
to the applicable sales charge); (g) purchases by a separate
account used to fund certain unregistered variable annuity
contracts; (h) investments of distributions from a UIT
sponsored by Salomon Smith Barney; (i) purchases by
investors participating in a Salomon Smith Barney fee-based
arrangement;  and (j)  purchases of Class A shares by
Section 403(b) or Section 401(a) or (k) accounts associated
with Copeland Retirement Programs. In order to obtain such
discounts, the purchaser must provide sufficient information
at the time of purchase to permit verification that the
purchase would qualify for the elimination of the sales
charge.

Right of Accumulation.  Class A shares of the Fund may be
purchased by "any person" (as defined above) at a reduced
sales charge or at net asset value determined by aggregating
the dollar amount of the new purchase and the total net
asset value of all Class A shares of the Fund and of other
Smith Barney Mutual Funds that are offered with a sales
charge as currently listed under "Exchange Privilege" then
held by such person and applying the sales charge applicable
to such aggregate.  In order to obtain such discount, the
purchaser must provide sufficient information at the time of
purchase to permit verification that the purchase qualifies
for the reduced sales charge.  The right of accumulation is
subject to modification or discontinuance at any time with
respect to all shares purchased thereafter.

Letter of Intent - Class A Shares.  A Letter of Intent for
an amount of $50,000 or more (For PFS Investments Accounts -
$25,000 or more) provides an opportunity for an investor to
obtain a reduced sales charge by aggregating investments
over a 13 month period, provided the investor refers to such
Letter when placing orders.  For purposes of a Letter of
Intent, the ''Amount of Investment'' as referred to in the
preceding sales charge table includes (i) all Class A shares
of the Fund and other Smith Barney Mutual Funds offered with
a sales charge acquired during the term of the letter plus
(ii) the value of all Class A shares previously purchased
and still owned.  Each investment made during the period
receives the reduced sales charge applicable to the total
amount of the investment goal.  If the goal is not achieved
within the period, the investor must pay the difference
between the sales charges applicable to the purchases made
and the charges previously paid, or an appropriate number of
escrowed shares will be redeemed.  The term of the Letter
will commence upon the date the Letter is signed, or at the
option of the investor, up to 90 days before such date.
Please contact your Service Agent or the sub-transfer agent
to obtain a Letter of Intent application.

Letter of Intent - Class Y Shares.  A Letter of Intent may
also be used as a way for investors to meet the minimum
investment requirement for Class Y shares (except purchases
of Class Y shares by Smith Barney Allocation Series Inc.,
for which there is no minimum purchase amount).  Such
investors must make an initial minimum purchase of
$5,000,000 in Class Y shares of the Fund and agree to
purchase a total of $15,000,000 of Class Y shares of the
Fund within 13 months from the date of the Letter. If a
total investment of $15,000,000 is not made within the 13-
month period, all Class Y shares purchased to date will be
transferred to Class A shares, where they will be subject to
all fees (including a service fee of 0.25%) and expenses
applicable to the Fund's Class A shares, which may include a
deferred sales charge of 1.00%. Please contact a your
Service Agent or the sub-transfer agent for further
information.

Deferred Sales Charge Provisions

"Deferred sales charge shares" are: (a) Class B shares; (b)
Class L shares; and (c) Class A shares that were purchased
without an initial sales charge but are subject to a
deferred sales charge.  A deferred sales charge may be
imposed on certain redemptions of these shares.

Any applicable deferred sales charge will be assessed on an
amount equal to the lesser of the original cost of the
shares being redeemed or their net asset value at the time
of redemption. Deferred sales charge shares that are
redeemed will not be subject to a deferred sales charge to
the extent that the value of such shares represents: (a)
capital appreciation of Fund assets; (b) reinvestment of
dividends or capital gain distributions; (c) with respect to
Class B shares, shares redeemed more than five years after
their purchase; or (d) with respect to Class L shares and
Class A shares that are deferred sales charge shares, shares
redeemed more than 12 months after their purchase.

Class L shares and Class A shares that are deferred sales
charge shares are subject to a 1.00% deferred sales charge
if redeemed within 12 months of purchase. In circumstances
in which the deferred sales charge is imposed on Class B
shares, the amount of the charge will depend on the number
of years since the shareholder made the purchase payment
from which the amount is being redeemed.  Solely for
purposes of determining the number of years since a purchase
payment, all purchase payments made during a month will be
aggregated and deemed to have been made on the last day of
the preceding Salomon Smith Barney statement month. The
following table sets forth the rates of the charge for
redemptions of Class B shares by shareholders.


Year Since Purchase Payment Was
Made

Deferred Sales Charge

First

5.00%

Second

4.00

Third

3.00

Fourth

2.00

Fifth

1.00

Sixth and thereafter

0.00

Class B shares will convert automatically to Class A shares
eight years after the date on which they were purchased and
thereafter will no longer be subject to any distribution
fees. There will also be converted at that time such
proportion of Class B Dividend Shares owned by the
shareholder as the total number of his or her Class B shares
converting at the time bears to the total number of
outstanding Class B shares (other than Class B Dividend
Shares) owned by the shareholder.

In determining the applicabilty of any deferred sales
charge, it will be assumed that a redemption is made first
of shares representing capital appreciation, next of shares
representing the reinvestment of dividends and capital gain
distributions and finally of other shares held by the
shareholder for the longest period of time. The length of
time that deferred sales charge shares acquired through an
exchange have been held will be calculated from the date
that the shares exchanged were initially acquired in one of
the other Smith Barney Mutual Funds, and fund shares being
redeemed will be considered to represent, as applicable,
capital appreciation or dividend and capital gain
distribution reinvestments in such other funds.  For Federal
income tax purposes, the amount of the deferred sales charge
will reduce the gain or increase the loss, as the case may
be, on the amount realized on redemption.  The amount of any
deferred sales charge will be paid to Salomon Smith Barney.
To provide an example, assume an investor purchased 100
Class B shares of the Fund at $10 per share for a cost of
$1,000.  Subsequently, the investor acquired 5 additional
shares of the Fund through dividend reinvestment.  During
the fifteenth month after the purchase, the investor decided
to redeem $500 of his or her investment.  Assuming at the
time of the redemption the net asset value had appreciated
to $12 per share, the value of the investor's shares would
be $1,260 (105 shares at $12 per share). The deferred sales
charge would not be applied to the amount which represents
appreciation ($200) and the value of the reinvested dividend
shares ($60).  Therefore, $240 of the $500 redemption
proceeds ($500 minus $260) would be charged at a rate of
4.00% (the applicable rate for Class B shares) for a total
deferred sales charge of $9.60.

Waivers of Deferred Sales Charge

The deferred sales charge will be waived on: (a) exchanges
(see "Exchange Privilege"); (b) redemptions of shares within
12 months following the death or disability of the
shareholder; (c) redemptions of shares made in connection
with qualified distributions from retirement plans or IRAs
upon the attainment of age 591/2; (d) involuntary redemptions;
and (e) redemptions of shares to effect a combination of the
Fund with any investment company by merger, acquisition of
assets or otherwise. In addition, a shareholder who has
redeemed shares from other Smith Barney Mutual Funds may,
under certain circumstances, reinvest all or part of the
redemption proceeds within 60 days and receive pro rata
credit for any deferred sales charge imposed on the prior
redemption.

Deferred sales charge waivers will be granted subject to
confirmation (by Salomon Smith Barney in the case of
shareholders who are also Salomon Smith Barney clients or by
the sub-transfer agent in the case of all other
shareholders) of the shareholder's status or holdings, as
the case may be.

Salomon Smith Barney Retirement Programs

You may be eligible to participate in a retirement program
sponsored by Salomon Smith Barney or one of its affiliates.
The Fund offers Class A and Class L shares at net asset
value to participating plans under the programs. You can
meet minimum investment and exchange amounts, if any, by
combining the plan's investments in any of the Smith Barney
mutual funds.

There are no sales charges when you buy or sell shares and
the class of shares you may purchase depends on the amount
of your initial investment and/or the date your account is
opened.  Once a class of shares is chosen, all additional
purchases must be of the same class.

For plans opened on or after March 1, 2000 that are not
plans for which Paychex Inc. or an affiliate provides
administrative services (a "Paychex plan"), Class A shares
may be purchased regardless of the amount invested.

For plans opened prior to March 1, 2000 and for Paychex
plans, the class of shares you may purchase depends on the
amount of your initial investment:

Class A Shares.  Class A shares may be purchased by plans
investing at least $1 million.

Class L Shares.  Class L shares may be purchased by plans
investing less than $1 million.  Class L shares are eligible
to exchange into Class A shares not later than 8 years after
the plan joined the program.  They are eligible for exchange
in the following circumstances:

If the plan was opened on or after June 21, 1996 and a total
of $1 million is invested in Smith Barney Funds Class L
shares (other than money market funds), all Class L shares
are eligible for exchange after the plan is in the program
for 5 years.

If the plan was opened before June 21, 1996 and a total of
$500,000 is invested in Smith Barney Funds Class L shares
(other than money market funds) on December 31 in any year,
all Class L shares are eligible for exchange on or about
March 31 of the following year.

For more information, call your Salomon Smith Barney
Financial Consultant or the transfer agent.

Retirement Programs Opened On or After June 21, 1996.  If,
at the end of the fifth year after the date the
participating plan enrolled in the Smith Barney 401(k)
Program or the ExecChoiceTM Program, a participating plan's
total Class L holdings in all non-money market Smith Barney
mutual funds equal at least $1,000,000, the participating
plan will be offered the opportunity to exchange all of its
Class L shares shares for Class A shares of the Fund. (For
participating plans that were originally established through
a Salomon Smith Barney retail brokerage account, the five-
year period will be calculated from the date the retail
brokerage account was opened.) Such participating plans will
be notified of the pending exchange in writing within 30
days after the fifth anniversary of the enrollment date and,
unless the exchange offer has been rejected in writing, the
exchange will occur on or about the 90th day after the fifth
anniversary date. If the participating plan does not qualify
for the five-year exchange to Class A shares, a review of
the participating plan's holdings will be performed each
quarter until either the participating plan qualifies or the
end of the eighth year.

Retirement Programs Opened Prior to June 21, 1996.  In any
year after the date a participating plan enrolled in the
Smith Barney 401(k) Program, if a participating plan's total
Class L holdings in all non-money market Smith Barney mutual
funds equal at least $500,000 as of the calendar year-end,
the participating plan will be offered the opportunity to
exchange all of its Class L shares for Class A shares of the
Fund. Such Plans will be notified in writing within 30 days
after the last business day of the calendar year and, unless
the exchange offer has been rejected in writing, the
exchange will occur on or about the last business day of the
following March.

Any participating plan in the Smith Barney 401(k) or the
ExecChoiceTM Program, whether opened before or after June
21, 1996, that has not previously qualified for an exchange
into Class A shares will be offered the opportunity to
exchange all of its Class L shares for Class A shares of the
Fund, regardless of asset size, at the end of the eighth
year after the date the participating plan enrolled in the
Smith Barney 401(k) Program or ExecChoiceTM Program.  Such
plans will be notified of the pending exchange in writing
approximately 60 days before the eighth anniversary of the
enrollment date and, unless the exchange has been rejected
in writing, the exchange will occur on or about the eighth
anniversary date. Once an exchange has occurred, a
participating plan will not be eligible to acquire
additional Class L shares, but instead may acquire Class A
shares of the same Fund. Any Class L shares not converted
will continue to be subject to the distribution fee.

Participating plans wishing to acquire shares of the Fund
through the Smith Barney 401(k) Program or the Smith Barney
ExecChoiceTM Program must purchase such shares directly from
the transfer agent. For further information regarding these
Programs, investors should contact a Service Agent.

Retirement Programs Investing in Class B Shares:  Class B
shares of a Fund are not available for purchase by
participating plans opened on or after June 21, 1996, but
may continue to be purchased by any participating plan in
the Smith Barney 401 (k) Program opened prior to such date
and originally investing in such Class.  Class B shares
acquired are subject to a deferred sales charge of 3.00% of
redemption proceeds if the participating plan terminates
within eight years of the date the participating plan first
enrolled in the Smith Barney 401 (k) Program.

At the end of the eighth year after the date the
participating plan enrolled in the Smith Barney 401 (k)
Program, the participating plan will be offered the
opportunity to exchange all of its Class B shares for Class
A shares of the same Fund.  Such participating plan will be
notified of the pending exchange in writing approximately 60
days before the eighth anniversary of the enrollment date
and, unless the exchange has been rejected in writing, the
exchange will occur on or about the eighth anniversary date.
Once the exchange has occurred, a participating plan will
not be eligible to acquire additional Class B shares, but
instead may acquire Class A shares of the same Fund.  If the
participating elects not to exchange all of its Class B
shares at that time, each Class B share held by the
participating plan will have the same conversion feature as
Class B shares held by other investors.  See "Purchase of
Shares-deferred sales charge Alternatives."

No deferred sales charge is imposed on redemptions of Class
B shares to the extent that the net asset value of the
shares redeemed does not exceed the current net asset value
of the shares purchased through reinvestment of dividends or
capital gain distributions, plus the current net asset value
of Class B shares purchased more than eight years prior to
the redemption, plus increases in the net asset value of the
shareholder's Class B shares above the purchase payments
made during the preceding eight years.  Whether or not the
deferred sales charge applies to the redemption by a
participating plan depends on the number of years since the
participating plan first became enrolled in the Smith Barney
401(k) Program, unlike the applicability of the deferred
sales charge to redemptions by other shareholders, which
depends on the number of years since those shareholders made
the purchase payment from which the amount is being
redeemed.

The deferred sales charge will be waived on redemptions of
Class B shares in connection with lump-sum or other
distributions made by a participating plan as a result of
(a) the retirement of an employee in the participating plan;
(b) the termination of employment of an employee in the
participating plan; (c) the death or disability or an
employee in the participating plan; (d) the attainment of
age 59 1/2 by an employee in the participating plan; (e)
hardship of an employee in the participating plan to the
extent permitted under Section 401(k) of the Code; or (f)
redemptions of shares in connection with a loan made by the
participating plan to an employee.

Determination of Public Offering Price

Each Fund offers its shares to current shareholders of the
Fund on a continuous basis. The public offering price for a
Class A, Class B and Class Y share of a Fund is equal to the
net asset value per share at the time of purchase, plus for
Class A shares an initial sales charge based on the
aggregate amount of the investment.  The public offering
price for Class A share purchases, including applicable
rights of accumulation, equaling or exceeding $500,000 is
equal to the net asset value per share at the time of
purchase and no sales charge is imposed at the time of
purchase.  The public offering price for a Class L share
includes a 1.00% initial sales charge.  A deferred sales
charge is imposed on certain redemptions of Class B shares,
and on Class L shares and Class A shares (purchased in
amounts exceeding $500,000) redeemed within one year of
purchase.

REDEMPTION OF SHARES

The right of redemption of shares of each Fund may be
suspended or the date of payment postponed (a) for any
periods during which the New York Stock Exchange, Inc. (the
"NYSE") is closed (other than for customary weekend and
holiday closings), (b) when trading in the markets the Fund
normally utilizes is restricted, or an emergency exists, as
determined by the SEC, so that disposal of the Fund's
investments or determination of its net asset value is not
reasonably practicable or (c) for any other periods as the
SEC by order may permit for the protection of the Fund's
shareholders.

If the shares to be redeemed were issued in certificate
form, the certificates must be endorsed for transfer (or be
accompanied by an endorsed stock power) and must be
submitted to the sub-transfer agent together with the
redemption request. Any signature appearing on a share
certificate, stock power or written redemption request in
excess of $10,000 must be guaranteed by an eligible
guarantor institution such as a domestic bank, savings and
loan institution, domestic credit union, member bank of the
Federal Reserve System or member firm of a national
securities exchange.  Written redemption requests of $10,000
or less do not require a signature guarantee unless more
than one such redemption request is made in any 10-day
period or the redemption proceeds are to be sent to an
address other than the address of record.  Unless otherwise
directed, redemption proceeds will be mailed to an
investor's address of record.  A sub-transfer agent may
require additional supporting documents for redemptions made
by corporations, executors, administrators, trustees or
guardians.  A redemption request will not be deemed properly
received until a sub-transfer agent receives all required
documents in proper form.

If a shareholder holds shares in more than one Class, any
request for redemption must specify the Class being
redeemed.  In the event of a failure to specify which Class,
or if the investor owns fewer shares of the Class than
specified, the redemption request will be delayed until the
transfer agent receives further instructions from Salomon
Smith Barney, or if the shareholder's account is not with
Salomon Smith Barney, from the shareholder directly.  The
redemption proceeds will be remitted on or before the third
business day following receipt of proper tender, except on
any days on which the NYSE is closed or as permitted under
the 1940 Act, in extraordinary circumstances.  Generally, if
the redemption proceeds are remitted to a Salomon Smith
Barney brokerage account, these funds will not be invested
for the shareholder's benefit without specific instruction
and Salomon Smith Barney will benefit from the use of
temporarily uninvested funds.  Redemption proceeds for
shares purchased by check, other than a certified or
official bank check, will be remitted upon clearance of the
check, which may take up to fifteen days.

Distributions in Kind

If the Board of Directors of a Fund determines that it would
be detrimental to the best interests of the remaining
shareholders to make a redemption payment wholly in cash,
the Fund may pay, in accordance with SEC rules, any portion
of a redemption in excess of the lesser of $250,000 or 1.00%
of the Fund's net assets by a distribution in kind of
portfolio securities in lieu of cash. Securities issued as a
distribution in kind may incur brokerage commissions when
shareholders subsequently sell those securities.

Salomon Smith Barney Accounts.

Shares held by Salomon Smith Barney as custodian must be
redeemed by submitting a written request to a Financial
Consultant. Shares other than those held by Salomon Smith
Barney as custodian may be redeemed through an investor's
Service Agent or by submitting a written request for
redemption to:

Smith Barney Sector Series Inc.
(Name of Fund)
Class A, B, L, or Y (please specify)
c/o PFPC Global Fund Services
P.O. Box 9699
Providence, RI   02940 - 9699

A written redemption request must (a) state the name of the
Fund, the class and number or dollar amount of shares to be
redeemed, (b) identify the shareholder's account number and
(c) be signed by each registered owner exactly as the shares
are registered. If the shares to be redeemed were issued in
certificate form, the certificates must be endorsed for
transfer (or be accompanied by an endorsed stock power) and
must be submitted to PFPC together with the redemption
request. Any signature appearing on a share certificate,
stock power or written redemption request in excess of
$50,000 must be guaranteed by an eligible guarantor
institution, such as a domestic bank, savings and loan
institution, domestic credit union, member bank of the
Federal Reserve System or member firm of a national
securities exchange. Written redemption requests of $50,000
or less do not require a signature guarantee unless more
than one such redemption request is made in any 10-day
period.  Redemption proceeds will be mailed to an investor's
address of record. The Transfer Agent may require additional
supporting documents for redemptions made by corporations,
executors, administrators, trustees or guardians. A
redemption request will not be deemed properly received
until the Transfer Agent receives all required documents in
proper form.

Telephone Redemption and Exchange Program.  Shareholders who
do not have a brokerage account may be eligible to redeem
and exchange shares by telephone. To determine if a
shareholder is entitled to participate in this program, he
or she should contact the transfer agent at 1-800-451-2010.
Once eligibility is confirmed, the shareholder must complete
and return a Telephone/Wire Authorization Form, along with a
signature guarantee, that will be provided by the transfer
agent upon request.  (Alternatively, an investor may
authorize telephone redemptions on the new account
application with the applicant's signature guarantee when
making his/her initial investment in the Fund.)

Redemptions.   Redemption requests of up to $50,000 of any
class or classes of shares of the fund may be made by
eligible shareholders by calling the transfer agent at 1-
800-451-2010. Such requests may be made between 9:00 a.m.
and 4:00 p.m. (New York City time) on any day the New York
Stock Exchange ("NYSE") is open. Redemptions of shares (i)
by retirement plans or (ii) for which certificates have been
issued are not permitted under this program.

A shareholder will have the option of having the redemption
proceeds mailed to his/her address of record or wired to a
bank account predesignated by the shareholder.  Generally,
redemption proceeds will be mailed or wired, as the case may
be, on the next business day following the redemption
request.  In order to use the wire procedures, the bank
receiving the proceeds must be a member of the Federal
Reserve System or have a correspondent relationship with a
member bank. Each Fund reserves the right to charge
shareholders a nominal fee for each wire redemption. Such
charges, if any, will be assessed against the shareholder's
account from which shares were redeemed.  In order to change
the bank account designated to receive redemption proceeds,
a shareholder must complete a new Telephone/Wire
Authorization Form and, for the protection of the
shareholder's assets, will be required to provide a
signature guarantee and certain other documentation.
Exchanges.  Eligible shareholders may make exchanges by
telephone if the account registration of the shares of a
Fund being acquired is identical to the registration of the
shares of the Fund exchanged.  Such exchange requests may be
made by calling the transfer agent at 1-800-451-2010 between
9:00 a.m. and 4:00 p.m. (New York City time) on any day on
which the NYSE is open.

Additional Information regarding Telephone Redemption and
Exchange Program.   Neither the Funds nor any of their
agents will be liable for following instructions
communicated by telephone that are reasonably believed to be
genuine.  Each Fund and its agents will employ procedures
designed to verify the identity of the caller and legitimacy
of instructions (for example, a shareholder's name and
account number will be required and phone calls may be
recorded). The Funds reserve the right to suspend, modify or
discontinue the telephone redemption and exchange program or
to impose a charge for this service at any time following at
least seven (7) days' prior notice to shareholders.

PFS Investments Accounts

Shareholders may redeem for cash some or all of their shares
of each Fund at any time by sending a written request in
proper form directly to PFS Shareholder Services, at P.O.
Box 105033, Atlanta, Georgia 30348-5033. If you should have
any questions concerning how to redeem your account after
reviewing the information below, please contact PFS
Shareholder Services at (800) 544-5445, Spanish-speaking
representatives (800) 544-7278 or TDD Line for the Hearing
Impaired (800) 824-1721.
The request for redemption must be signed by all persons in
whose names the shares are registered. Signatures must
conform exactly to the account registration. If the proceeds
of the redemption exceed $50,000, or if the proceeds are not
paid to the record owner(s) at the record address, if the
shareholder(s) has had an address change within 45 days or
less of the shareholder's redemption request, or if the
shareholder(s) is a corporation, sole proprietor,
partnership, trust or fiduciary, signature(s) must be
guaranteed by one of the following: a bank or trust company;
a broker-dealer; a credit union; a national securities
exchange, registered securities association or clearing
agency; a savings and loan association; or a federal savings
bank.

Generally, a properly completed Redemption Form with any
required signature guarantee is all that is required for a
redemption. In some cases, however, other documents may be
necessary. For example, in the case of shareholders holding
certificates, the certificates for the shares being redeemed
must accompany the redemption request. Additional
documentary evidence of authority is also required by PFS
Shareholder Services in the event redemption is requested by
a corporation, partnership, trust, fiduciary, executor or
administrator. Additionally, if a shareholder requests a
redemption from a Retirement Plan account (IRA or SEP), such
request must state whether or not federal income tax is to
be withheld from the proceeds of the redemption check.
Redemption from a 403(b)(7) account requires completion of a
special form.  Please call PFS Shareholder Services at (800)
544-5445 between 8:00 a.m. and 8:00 p.m. eastern standard
time to obtain the proper forms.

A shareholder may utilize PFS Shareholder Services Telephone
Redemption service to redeem his or her account as long as
they have authorized the telephone redemption option.  If a
shareholder does not wish to allow telephone redemptions by
any person in his account, he should decline the telephone
transaction option on the account application.  The
telephone redemption option can be used only if: (a) the
redemption proceeds are to be mailed to the address of
record and there has been no change of address of record
within the preceding 45 days; (b) the shares to be redeemed
are not in certificate form; (c); the person requesting the
redemption can provide proper identification information;
and (d) the proceeds of the redemption do not exceed
$50,000.  403(b)(7) accounts and accounts not registered in
the name of individual(s) are not eligible for the telephone
redemption option.  Telephone redemption requests can be
made by contacting PFS Shareholder Services at (800) 544-
5445 between 9:00 a.m. and 6:00 p.m. eastern time any day
that the NYSE is open.  Telephone redemption may not be
available if the shareholder cannot reach PFS Shareholder
Services whether because all telephone lines are busy or for
any other reason; in such case, a shareholder would have to
use the Fund's regular redemption procedure described above.

A shareholder may utilize PFS Shareholder Services FAX to
redeem the shareholder's account as long as a signature
guarantee or other documentary evidence is not required.
Redemption requests should be properly signed by all owners
of the account and faxed to PFS Shareholder Services at
(800) 554-2374. Facsimile redemptions may not be available
if the shareholder cannot reach PFS Shareholder Services by
FAX, whether because all telephone lines are busy or for any
other reason; in such case, a shareholder would have to use
the fund's regular redemption procedure described above.
Facsimile redemptions received by PFS Shareholder Services
prior to 4:00 p.m. Eastern time on a regular business day
will be processed at the net asset value per share
determined that day.

Redemption proceeds can be sent by check to the address of
record, by wire transfer to a bank account designated on the
application or to a bank account designated on the
application via the Automated Clearinghouse (ACH).  A
shareholder will be charged a $25 service fee for wire
transfers and a nominal service fee for transfers made
directly to the shareholder's bank by the ACH. PFS
Shareholder Services will process and mail a shareholder's
redemption check usually within two to three business days
after receiving the redemption request in good order.  The
shareholder may request the proceeds to be mailed by two-day
air express for an $8 fee that will be deducted from the
shareholder's account or by one-day air express for a $15
fee that will be deducted from the shareholder's account.

Automatic Cash Withdrawal Plan

An automatic cash withdrawal plan (the "Withdrawal Plan") is
available to shareholders who own shares with a value of at
least $10,000 ($5,000 for retirement plan accounts) and who
wish to receive specific amounts of cash monthly or
quarterly. Withdrawals of at least $50 may be made under the
Withdrawal Plan by redeeming as many shares of the fund as
may be necessary to cover the stipulated withdrawal payment.
Any applicable deferred sales charge will not be waived on
amounts withdrawn by shareholders that exceed 1.00% per
month of the value of a shareholder's shares at the time the
Withdrawal Plan commences. (With respect to Withdrawal Plans
in effect prior to November 7, 1994, any applicable deferred
sales charge will be waived on amounts withdrawn that do not
exceed 2.00% per month of the value of a shareholder's
shares that are subject to a deferred sales charge).  To the
extent withdrawals exceed dividends, distributions and
appreciation of a shareholder's investment in the fund,
there will be a reduction in the value of the shareholder's
investment and continued withdrawal payments will reduce the
shareholder's investment and ultimately may exhaust it.
Withdrawal payments should not be considered as income from
investment in the fund. Furthermore, as it generally would
not be advantageous to a shareholder to make additional
investments in the fund at the same time he or she is
participating in the Withdrawal Plan, purchases by such
shareholders in amounts of less than $5,000 ordinarily will
not be permitted.

Shareholders who wish to participate in the Withdrawal Plan
and who hold their shares in certificate form must deposit
their share certificates with the applicable sub-transfer
agent as agent for Withdrawal Plan members. All dividends
and distributions on shares in the Withdrawal Plan are
reinvested automatically at net asset value in additional
shares of a Fund. A shareholder who purchases shares
directly through a sub-transfer agent may continue to do so
and applications for participation in the Withdrawal Plan
must be received by the applicable sub-transfer agent  no
later than the eighth day of the month to be eligible for
participation beginning with that month's withdrawal. For
additional information, shareholders should contact a
Service Agent.


VALUATION OF SHARES

The net asset value per share of the Fund's Classes is
calculated on each day, Monday through Friday, except days
on which the NYSE is closed. The NYSE currently is scheduled
to be closed on New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving and Christmas, and on the
preceding Friday or subsequent Monday when one of these
holidays falls on a Saturday or Sunday, respectively.
Because of the differences in distribution fees and
Class-specific expenses, the per share net asset value of
each Class may differ. The following is a description of the
procedures used by the Fund in valuing its assets.

Securities listed on a national securities exchange will be
valued on the basis of the last sale on the date on which
the valuation is made or, in the absence of sales, at the
mean between the closing bid and asked prices.
Over-the-counter securities will be valued at the mean
between the closing bid and asked prices on each day, or, if
market quotations for those securities are not readily
available, at fair value, as determined in good faith by the
Company's Board of Directors. Short-term obligations with
maturities of 60 days or less are valued at amortized cost,
which constitutes fair value as determined by the Company's
Board of Directors. Amortized cost involves valuing an
instrument at its original cost to the Fund and thereafter
assuming a constant amortization to maturity of any discount
or premium, regardless of the effect of fluctuating interest
rates on the market value of the instrument. All other
securities and other assets of the Fund will be valued at
fair value as determined in good faith by the Company's
Board of Directors.

EXCHANGE PRIVILEGE

Except as noted below and in the Prospectus, shareholders of
any of the Smith Barney Mutual Funds may exchange all or
part of their shares for shares of the same class of other
Smith Barney Mutual Funds, to the extent such shares are
offered for sale in the shareholder's state of residence, on
the basis of relative net asset value per share at the time
of exchange as follows:

A. Class A and Class Y shares of the Fund may be
exchanged without a sales charge for the respective
shares of any of the Smith Barney Mutual Funds.

B. Class B shares of any Fund may be exchanged without
a sales charge. Class B shares of the Fund exchanged
for Class B shares of another Smith Barney Mutual Fund
will be subject to the higher applicable deferred
sales charge of the two funds and, for purposes of
calculating deferred sales charge rates and conversion
periods, will be deemed to have been held since the
date the shares being exchanged were deemed to be
purchased.

C. Class L shares of any Fund may be exchanged without
a sales charge. For purposes of deferred sales charge
applicability, Class L shares of the Fund exchanged
for Class L shares of another Smith Barney Mutual Fund
will be deemed to have been owned since the date the
shares being exchanged were deemed to be purchased.

The exchange privilege enables shareholders to acquire
shares of the same Class in a Fund with different investment
objectives when they believe that a shift between funds is
an appropriate investment decision. This privilege is
available to shareholders residing in any state in which
fund shares being acquired may legally be sold. Prior to any
exchange, the shareholder should obtain and review a copy of
the current prospectus of each fund into which an exchange
is being considered. Prospectuses may be obtained from a
Salomon Smith Barney Financial Consultant.

Upon receipt of proper instructions and all necessary
supporting documents, shares submitted for exchange are
redeemed at the then-current net asset value and the
proceeds are immediately invested, at a price as described
above, in shares of the Fund being acquired. Salomon Smith
Barney reserves the right to reject any exchange request.
The exchange privilege may be modified or terminated at any
time after written notice to shareholders.

Additional Information Regarding the Exchange Privilege.
Each Fund is not designed to provide investors with a means
of speculation on short-term market movements.  A pattern of
frequent exchanges by investors can be disruptive to
efficient portfolio management and, consequently, can be
detrimental to the Fund and its shareholders.  Accordingly,
if a Fund's management in its sole discretion determines
that an investor is engaged in excessive trading, the Fund,
with or without prior notice, may temporarily or permanently
terminate the availability to that investor of Fund
exchanges, or reject in whole or part any purchase or
exchange request with respect to such investor's account.
Such investors also may be barred from purchases and
exchanges involving other funds in the Smith Barney Mutual
Fund family. Accounts under common ownership or control will
be considered as one account for purposes of determining a
pattern of excessive trading. Each Fund may notify an
investor of rejection of a purchase or exchange order after
the day the order is placed.  If an exchange request is
rejected, a Fund will take no other action with respect to
the shares until it receives further instructions from the
investor.  The Fund's policy on excessive trading applies to
investors who invest in a Fund directly or through Service
Agents, but does not apply to any systematic investment
plans described in the prospectus.

During times of drastic economic or market conditions, each
Fund may suspend the Exchange Privilege temporarily without
notice and treat exchange requests based on their separate
components - redemption orders with a simultaneous request
to purchase the other fund's shares.  In such a case, the
redemption request would be processed at a Fund's next
determined net asset value but the purchase order would be
effective only at the net asset value next determined after
the fund being purchased formally accepts the order, which
may result in the purchase being delayed.

PERFORMANCE INFORMATION

From time to time, the Company may advertise the Fund's
total return and average annual total return in
advertisements and/or other types of sales literature.
These figures are computed separately for Class A, Class B,
Class L and Class Y shares of the Fund.  These figures are
based on historical earnings and are not intended to
indicate future performance.  Total return is computed for a
specified period of time assuming deduction of the maximum
sales charge, if any, from the initial amount invested and
reinvestment of all income dividends and capital gain
distributions on the reinvestment dates at prices calculated
as stated in the prospectus, then dividing the value of the
investment at the end of the period so calculated by the
initial amount invested and subtracting 100%.  The standard
average annual total return, as prescribed by the SEC is
derived from this total return, which provides the ending
redeemable value.  Such standard total return information
may also be accompanied with nonstandard total return
information for differing periods computed in the same
manner but without annualizing the total return or taking
sales charges into account. The Company may also include
comparative performance information in advertising or
marketing the Fund's shares. Such performance information
may include data from Lipper Analytical Services, Inc. and
other financial publications.

From time to time, the Company may quote a Fund's yield or
total return in advertisements or in reports and other
communications to shareholders. The Company may include
comparative performance information in advertising or
marketing a Fund's shares. Such performance information may
be included in the following industry and financial
publications- Barron's, Business Week, CDA Investment
Technologies, Inc., Changing Times, Forbes, Fortune,
Institutional Investor, Investor's Business Daily, Money,
Morningstar Mutual Fund Values, The New York Times, USA
Today and The Wall Street Journal.  To the extent any
advertisement or sales literature of a Fund describes the
expenses or performance of any Class it will also disclose
such information for the other Classes.

Average Annual Total Return

"Average annual total return" figures are computed according
to a formula prescribed by the SEC. The formula can be
expressed as follows:

	P (1 + T)n = ERV

	Where:	P	=	a hypothetical initial payment
of $ 1,000.
			T	=	average annual total return.
			n	=	number of years.
			ERV	=	Ending Redeemable Value of a
hypothetical $1,000
					investment made at the
beginning of a 1-, 5- or 10-year
					period at the end of the 1-,
5- or 10-year period (or
					fractional portion thereof),
assuming reinvestment of all
					dividends and distributions.

The ERV assumes complete redemption of the hypothetical
investment at the end of the measuring period.  A Fund's net
investment income changes in response to fluctuations in
interest rates and the expenses of a Fund.


Financial Services Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
32.42%
Class B2
N/A
N/A
N/A
33.68%
Class L3
N/A
N/A
N/A
36.30%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.


Health Sciences Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
20.75%
Class B2
N/A
N/A
N/A
21.49%
Class L3
N/A
N/A
N/A
24.23%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.




Technology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(23.83)%
Class B2
N/A
N/A
N/A
(24.25)%
Class L3
N/A
N/A
N/A
(21.85)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.


Aggregate Total Return

A Fund's "aggregate total return," as described below,
represents the cumulative change in the value of an
investment in a Fund for the specified period and is
computed by the following formula:

ERV - P
P

	Where: 	P 	=	a hypothetical initial payment
of $10,000.

				ERV	=	Ending Redeemable Value of a
hypothetical $10,000
investment made at the
beginning of the 1-, 5- or 10-
year period at the end of the
1-, 5- or 10-year period (or
fractional portion thereof),
assuming reinvestment of all
dividends and distributions.

The ERV assumes complete redemption of the hypothetical
investment at the end of the measuring period.

Performance will vary from time to time depending on market
conditions, the composition of the Fund's portfolio and
operating expenses. Consequently, any given performance
quotation should not be considered representative of the
Fund's performance for any specified period in the future.
Because performance will vary, it may not provide a basis
for comparing an investment in the Fund with certain bank
deposits or other investments that pay a fixed yield for a
stated period of time.

Financial Services Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
32.42%
Class B2
N/A
N/A
N/A
33.68%
Class L3
N/A
N/A
N/A
36.30%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.

Health Sciences Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
20.75%
Class B2
N/A
N/A
N/A
21.49%
Class L3
N/A
N/A
N/A
24.23%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.



Technology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(23.83)%
Class B2
N/A
N/A
N/A
(24.25)%
Class L3
N/A
N/A
N/A
(21.85)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was February 28, 2000.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Dividends and Distributions

Each Fund's policy is to distribute its net investment
income and net realized capital gains, if any, annually.
The Fund may also pay additional dividends shortly before
December 31 from certain amounts of undistributed ordinary
and capital gains realized, in order to avoid a Federal
excise tax liability.

If a shareholder does not otherwise instruct, dividends and
capital gains distributions will be reinvested automatically
in additional shares of the same Class at net asset value,
subject to no sales charge or deferred sales charge.  A
shareholder may change the option at any time by notifying
his Salomon Smith Barney Financial Consultant or Dealer
Representative.  Shareholders whose account is held directly
at the sub-transfer agent should notify them in writing,
requesting a change to this reinvest option.

The per share dividends on Class B and Class L shares of a
Fund may be lower than the per share dividends on Class A
and Class Y shares principally as a result of the
distribution fee applicable with respect to Class B and
Class L shares. The per share dividends on Class A shares
may be lower than the per share dividends on Class Y shares
principally as a result of the service fee applicable to
Class A shares. Distributions of capital gains, if any, will
be in the same amount for Class A, Class B, Class L and
Class Y shares.

Taxes

The following is a summary of the material United States
federal income tax considerations regarding the purchase,
ownership and disposition of shares of the Funds.  Each Fund
will be treated as a separate corporation for United States
federal income tax purposes, including qualification as a
regulated investment company; and the following discussion
applies separately to each Fund. Each prospective
shareholder is urged to consult his own tax adviser with
respect to the specific federal, state, local and foreign
tax consequences of investing in a Fund.  The summary is
based on the laws in effect on the date of this SAI, which
are subject to change.

The Funds and Their Investments

Each Fund intends to qualify to be treated as a regulated
investment company each taxable year under the Code.  To so
qualify, the Fund must, among other things: (a) derive at
least 90% of its gross income in each taxable year from
dividends, interest, payments with respect to securities
loans and gains from the sale or other disposition of stock
or securities or foreign currencies, or other income
(including, but not limited to, gains from options, futures
or forward contracts) derived with respect to its business
of investing in such stock, securities or currencies; and
(b) diversify its holdings so that, at the end of each
quarter of the Fund's taxable year, (i) at least 50% of the
market value of the Fund's assets is represented by cash,
securities of other regulated investment companies, United
States government securities and other securities, with such
other securities limited, in respect of any one issuer, to
an amount not greater than 5% of the Fund's assets and not
greater than 10% of the outstanding voting securities of
such issuer and (ii) not more than 25% of the value of its
assets is invested in the securities (other than United
States government securities or securities of other
regulated investment companies) of any one issuer or any two
or more issuers that the Fund controls and which are
determined to be engaged in the same or similar trades or
businesses or related trades or businesses.

As a regulated investment company, a Fund will not be
subject to United States federal income tax on its net
investment income (i.e., income other than its net realized
long-term and short-term capital gains) and its net realized
long-term and short-term capital gains, if any, that it
distributes to its shareholders, provided an amount equal to
at least 90% of the sum of its investment company taxable
income (i.e., 90% of its taxable income minus the excess, if
any, of its net realized long-term capital gains over its
net realized short-term capital losses (including any
capital loss carryovers), plus or minus certain other
adjustments as specified in the Code) and its net tax-exempt
income for the taxable year is distributed in compliance
with the Code's timing and other requirements but will be
subject to tax at regular corporate rates on any taxable
income or gains it does not distribute.  Furthermore, a Fund
will be subject to a United States corporate income tax with
respect to such distributed amounts in any year it fails to
qualify as a regulated investment company or fails to meet
this distribution requirement. The Code imposes a 4%
nondeductible excise tax on a Fund to the extent it does not
distribute by the end of any calendar year at least 98% of
its net investment income for that year and 98% of the net
amount of its capital gains (both long-term and short-term)
for the one-year period ending, as a general rule, on
October 31 of that year.  For this purpose, however, any
income or gain retained by the Fund that is subject to
corporate income tax will be considered to have been
distributed by year-end.  In addition, the minimum amounts
that must be distributed in any year to avoid the excise tax
will be increased or decreased to reflect any
underdistribution or overdistribution, as the case may be,
from the previous year.  Each Fund anticipates that it will
pay such dividends and will make such distributions as are
necessary in order to avoid the application of this tax.

On October 31, 2000, with regard to the Technology Fund, the
unused capital loss carryforwards were approximately
$10,602,000. For federal income tax purposes, this amount is
available to be applied against future capital gains of the
Fund, if it has carryforwards, that are realized prior to
the expiration of the applicable carryforward.  The
carryforwards expire on October 31, 2008.

If, in any taxable year, a Fund fails to qualify as a
regulated investment company under the Code or fails to meet
the distribution requirement, it would be taxed in the same
manner as an ordinary corporation and distributions to its
shareholders would not be deductible by the Fund in
computing its taxable income.  In addition, in the event of
a failure to qualify, the Fund's distributions, to the
extent derived from the Fund's current or accumulated
earnings and profits would constitute dividends (eligible
for the corporate dividends-received deduction) which are
taxable to shareholders as ordinary income, even though
those distributions might otherwise (at least in part) have
been treated in the shareholders' hands as long-term capital
gains.  If a Fund fails to qualify as a regulated investment
company in any year, it must pay out its earnings and
profits accumulated in that year in order to qualify again
as a regulated investment company.  In addition, if a Fund
failed to qualify as a regulated investment company for a
period greater than one taxable year, the Fund may be
required to recognize any net built-in gains with respect to
certain of it's assets (the excess of the aggregate gains,
including items of income, over aggregate losses that would
have been realized if it had been liquidated) in order to
qualify as a regulated investment company in a subsequent
year.

A Fund's transactions in foreign currencies, forward
contracts, options and futures contracts (including options
and futures contracts on foreign currencies) will be subject
to special provisions of the Code (including provisions
relating to "hedging transactions" and "straddles") that,
among other things, may affect the character of gains and
losses realized by the Fund (i.e., may affect whether gains
or losses are ordinary or capital), accelerate recognition
of income to the Fund and defer Fund losses.  These rules
could therefore affect the character, amount and timing of
distributions to shareholders.  These provisions also (a)
will require the Fund to mark-to-market certain types of the
positions in its portfolio (i.e., treat them as if they were
closed out) and (b) may cause the Fund to recognize income
without receiving cash with which to pay dividends or make
distributions in amounts necessary to satisfy the
distribution requirements for avoiding income and excise
taxes.  Each Fund will monitor its transactions, will make
the appropriate tax elections and will make the appropriate
entries in its books and records when it acquires any
foreign currency, forward contract, option, futures contract
or hedged investment in order to mitigate the effect of
these rules and prevent disqualification of the Fund as a
regulated investment company.

A Fund's investment in Section 1256 contracts, such as
regulated futures contracts, most forward currency contracts
traded in the interbank market and options on most stock
indices, are subject to special tax rules.  All section 1256
contracts held by a Fund at the end of its taxable year are
required to be marked to their market value, and any
unrealized gain or loss on those positions will be included
in the Fund's income as if each position had been sold for
its fair market value at the end of the taxable year.  The
resulting gain or loss will be combined with any gain or
loss realized by the Fund from positions in section 1256
contracts closed during the taxable year.  Provided such
positions were held as capital assets and were not part of a
"hedging transaction" nor part of a "straddle," 60% of the
resulting net gain or loss will be treated as long-term
capital gain or loss, and 40% of such net gain or loss will
be treated as short-term capital gain or loss, regardless of
the period of time the positions were actually held by the
Fund.

Foreign Investments.  Dividends or other income (including,
in some cases, capital gains) received by the Fund from
investments in foreign securities may be subject to
withholding and other taxes imposed by foreign countries.
Tax conventions between certain countries and the United
States may reduce or eliminate such taxes in some cases.  A
Fund will not be eligible to elect to treat any foreign
taxes paid by it as paid by its shareholders, who therefore
will not be entitled to credits for such taxes on their own
tax returns.  Foreign taxes paid by a Fund will reduce the
return from the Fund's investments.

Passive Foreign Investment Companies.  If a Fund purchases
shares in certain foreign investment entities, called
"passive foreign investment companies" (a "PFIC"), it may be
subject to United States federal income tax on a portion of
any "excess distribution" or gain from the disposition of
such shares even if such income is distributed as a taxable
dividend by the Fund to its shareholders.  Additional
charges in the nature of interest may be imposed on the Fund
in respect of deferred taxes arising from such distributions
or gains.  If a Fund were to invest in a PFIC and elected to
treat the PFIC as a "qualified electing fund" under the
Code, in lieu of the foregoing requirements, the Fund might
be required to include in income each year a portion of the
ordinary earnings and net capital gains of the qualified
electing fund, even if not distributed to the Fund, and such
amounts would be subject to the 90% and excise tax
distribution requirements described above.  In order to make
this election, the Fund would be required to obtain certain
annual information from the PFICs in which it invests, which
may be difficult or not possible to obtain.

Alternatively, a Fund may elect a mark-to-market regime that
would result in the Fund being treated as if it had sold and
repurchased all of the PFIC stock at the end of each year.
In this case, the Fund would report gains as ordinary income
and would deduct losses as ordinary losses to the extent of
previously recognized gains. The election, once made, would
be effective for all subsequent taxable years of the Fund,
unless revoked with the consent of the IRS.  By making the
election, the Fund could potentially ameliorate the adverse
tax consequences with respect to its ownership of shares in
a PFIC, but in any particular year may be required to
recognize income in excess of the distributions it receives
from PFICs and its proceeds from dispositions of PFIC stock.
The Fund may have to distribute this "phantom" income and
gain to satisfy its distribution requirement and to avoid
imposition of the 4% excise tax.

Each Fund will make the appropriate tax elections, if
possible, and take any additional steps that are necessary
to mitigate the effect of these rules.

Taxation of United States Shareholders

Dividends and Distributions.  Any dividend declared by a
Fund in October, November or December of any calendar year
and payable to shareholders of record on a specified date in
such a month shall be deemed to have been received by each
shareholder on December 31 of such calendar year and to have
been paid by the Fund not later than such December 31,
provided such dividend is actually paid by the Fund during
January of the following calendar year.  Each Fund intends
to distribute annually to its shareholders substantially all
of its investment company taxable income, and any net
realized long-term capital gains in excess of net realized
short-term capital losses (including any capital loss
carryovers).

Dividends of net investment income and distributions of net
realized short-term capital gains are taxable to a United
States shareholder as ordinary income, whether paid in cash
or in shares.  Distributions of net-long-term capital gains,
if any, that a Fund designates as capital gains dividends
are taxable as long-term capital gains, whether paid in cash
or in shares and regardless of how long a shareholder has
held shares of the Fund.  Dividends and distributions paid
by a Fund attributable to dividends on stock of U.S.
corporations received by the Fund, with respect to which the
Fund meets certain holding period requirements, will be
eligible for the deduction for dividends received by
corporations. Distributions in excess of a Fund's current
and accumulated earnings and profits will, as to each
shareholder, be treated as a tax-free return of capital to
the extent of a shareholder's basis in his shares of the
Fund, and as a capital gain thereafter (if the shareholder
holds his shares of the Fund as capital assets).
Shareholders receiving dividends or distributions in the
form of additional shares should be treated for United
States federal income tax purposes as receiving a
distribution in the amount equal to the amount of money that
the shareholders receiving cash dividends or distributions
will receive, and should have a cost basis in the shares
received equal to such amount.

Investors considering buying shares just prior to a dividend
or capital gain distribution should be aware that, although
the price of shares just purchased at that time may reflect
the amount of the forthcoming distribution, such dividend or
distribution may nevertheless be taxable to them. If a Fund
is the holder of record of any stock on the record date for
any dividends payable with respect to such stock, such
dividends are included in the Fund's gross income not as of
the date received but as of the later of (a) the date such
stock became ex-dividend with respect to such dividends
(i.e., the date on which a buyer of the stock would not be
entitled to receive the declared, but unpaid, dividends) or
(b) the date the Fund acquired such stock.  Accordingly, in
order to satisfy its income distribution requirements, the
Fund may be required to pay dividends based on anticipated
earnings, and shareholders may receive dividends in an
earlier year than would otherwise be the case.

Sales of Shares.  Upon the sale or exchange of his shares, a
shareholder will realize a taxable gain or loss equal to the
difference between the amount realized and his basis in his
shares.  Such gain or loss will be treated as capital gain
or loss, if the shares are capital assets in the
shareholder's hands, and will be long-term capital gain or
loss if the shares are held for more than one year and
short-term capital gain or loss if the shares are held for
one year or less.  Any loss realized on a sale or exchange
will be disallowed to the extent the shares disposed of are
replaced, including replacement through the reinvesting of
dividends and capital gains distributions in the Fund,
within a 61-day period beginning 30 days before and ending
30 days after the disposition of the shares.  In such a
case, the basis of the shares acquired will be increased to
reflect the disallowed loss.  Any loss realized by a
shareholder on the sale of a Fund share held by the
shareholder for six months or less will be treated for
United States federal income tax purposes as a long-term
capital loss to the extent of any distributions or deemed
distributions of long-term capital gains received by the
shareholder with respect to such share. If a shareholder
incurs a sales charge in acquiring shares of a Fund,
disposes of those shares within 90 days and then acquires
shares in a mutual fund for which the otherwise applicable
sales charge is reduced by reason of a reinvestment right
(e.g., an exchange privilege), the original sales charge
will not be taken into account in computing gain/loss on the
original shares to the extent the subsequent sales charge is
reduced.  Instead, the disregarded portion of the original
sales charge will be added to the tax basis in the newly
acquired shares.  Furthermore, the same rule also applies to
a disposition of the newly acquired shares made within 90
days of the second acquisition.  This provision prevents a
shareholder from immediately deducting the sales charge by
shifting his or her investment in a family of mutual funds.

Backup Withholding.  A Fund may be required to withhold, for
United States federal income tax purposes, 31% of the
dividends, distributions and redemption proceeds payable to
shareholders who fail to provide the Fund with their correct
taxpayer identification number or to make required
certifications, or who have been notified by the IRS that
they are subject to backup withholding.  Certain
shareholders are exempt from backup withholding.  Backup
withholding is not an additional tax and any amount withheld
may be credited against a shareholder's United States
federal income tax liabilities.

Notices.  Shareholders will be notified annually by each
Fund as to the United States federal income tax status of
the dividends, distributions and deemed distributions
attributable to undistributed capital gains (discussed above
in "Taxes - Taxation of United States Shareholders -
Dividends and Distributions") made by the Fund to its
shareholders.  Furthermore, shareholders will also receive,
if appropriate, various written notices after the close of
the Fund's taxable year regarding the United States federal
income tax status of certain dividends, distributions and
deemed distributions that were paid (or that are treated as
having been paid) by the Fund to its shareholders during the
preceding taxable year.

Other Taxation

Distributions also may be subject to additional state, local
and foreign taxes depending on each shareholder's particular
situation.

The foregoing is only a summary of certain material tax
consequences affecting the Funds and their shareholders.
Shareholders are advised to consult their own tax advisers
with respect to the particular tax consequences to them of
an investment in the Funds.

OTHER INFORMATION ABOUT THE COMPANY

The Company was incorporated under the laws of the State of
Maryland on July 16, 1986 under the name Shearson Lehman
Precious Metals and Minerals Fund Inc.  As the name of its
sponsor has changed, the Company's name has been changed on
December 19, 1995 to Smith Barney Natural Resources Fund
Inc. (the "Natural Resources Fund"). On November 29, 1999,
the Board of Directors voted to amend the Charter of the
Company to change its name to Smith Barney Sector Series
Inc. Each of the Financial Services Fund, Health Sciences
Fund, Technology Fund, Global Biotechnology Fund, Global
Media & Telecommunications Fund, and Global Technology is
classified as a series of the Company.  On December 15,
2000, the Natural Resources Fund merged into the Smith
Barney Fundamental Value Fund Inc.

The Company offers shares of four separate series with a par
value of $.001 per share.  Each Fund offers shares currently
classified into four Classes - A, B, L and Y.  Each Class of
the Fund represents an identical interest in the Fund's
investment portfolio.  As a result, the Classes have the
same rights, privileges and preferences, except with respect
to:  (a) the designation of each Class; (b) the effect of
the respective sales charges; if any, for each class;
(c) the distribution and/or service fees borne by each Class
pursuant to the Plan; (d) the expenses allocable exclusively
to each Class; (e) voting rights on matters exclusively
affecting a single Class; (f) the exchange privilege of each
Class; and (g) the conversion feature of the Class B shares.
The Company's Board of Directors does not anticipate that
there will be any conflicts among the interests of the
holders of the different Classes.  The directors, on an
ongoing basis, will consider whether any such conflict
exists and, if so, take appropriate action.

As permitted by Maryland law, there will normally be no
meetings of shareholders for the purpose of electing
directors unless and until such time as less than a majority
of the directors holding office have been elected by
shareholders.  At that time, the directors then in office
will call a shareholder's meeting for the election of
directors.  The directors must call a meeting of
shareholders for the purpose of voting upon the question of
removal of any director when requested in writing to do so
by the record holders of not less than 10% of the
outstanding shares of the Fund.  At such a meeting, a
director may be removed after the holders of record of not
less than a majority of the outstanding shares of the Fund
have declared that the director be removed either by
declaration in writing or by votes cast in person or by
proxy.  Except as set forth above, the directors shall
continue to hold office and may appoint successor directors.

As used in the Prospectus and this Statement of Additional
Information, a "vote of a majority of the outstanding voting
securities" means the affirmative vote of the lesser of (a)
more than 50% of the outstanding shares of the Company (or
the affected series or Class) or (b) 67% or more of such
shares present at a meeting if more than 50% of the
outstanding shares of the Company (or the affected series or
Class) are represented at the meeting in person or by proxy.
A series or Class shall be deemed to be affected by a matter
unless it is clear that the interests of each series or
Class in the matter are identical or that the matter does
not affect any interest of the series or Class.  The
approval of a management agreement or any change in a
fundamental investment policy would be effectively acted
upon with respect to the Fund only if approved by a "vote of
a majority of the outstanding voting securities" of the
Fund; however, the ratification of independent accountants,
the election of directors, and the approval of a
distribution agreement submitted to shareholders are not
subject to the separate voting requirements and may be
effectively acted upon by a vote of the holders of a
majority of all Company shares voting without regard to
series or Class.


Annual and Semi-annual Reports.  The Fund sends its
shareholders a semi-annual report and an audited annual
report, which include listings of investment securities held
by the Fund at the end of the period covered.  In an effort
to reduce the Fund's printing and mailing costs, the Fund
consolidates the mailing of its semi-annual and annual
reports by household. This consolidation means that a
household having multiple accounts with the identical
address of record will receive a single copy of each report.
In addition, the Fund also consolidates the mailing of its
Prospectus so that a shareholder having multiple accounts
(that is, individual, IRA and/or Self-Employed Retirement
Plan accounts) will receive a single Prospectus annually.
Shareholders who do not want this consolidation to apply to
their accounts should contact their Salomon Smith Barney
Financial Consultant or the transfer agent.

FINANCIAL STATEMENTS

The Funds' Annual Reports for the fiscal year ended October
31, 2000 are incorporated herein by reference in their
entirety.  The annual reports were filed on January 4, 2001,
Accession Number 930413-01-0019.

OTHER  INFORMATION
Styles of Fund Management: In an industry where the average
portfolio manager has seven years of experience (source:
ICI, 1998), the portfolio managers of Smith Barney mutual
funds average 21 years in the industry and 15 years with the
firm.
Smith Barney mutual funds offers more than 60 mutual funds.
We understand that many investors prefer an active role in
allocating the mix of funds in their portfolio, while others
want the asset allocation decisions to be made by
experienced managers.
That's why we offer five "styles" of fund management that
can be tailored to suit each investor's unique financial
goals.

	Classic Series  - our portfolio manager driven funds
Our Classic Series lets investors participate in
mutual funds whose investment decisions are determined
by experienced portfolio managers, based on each
fund's investment objectives and guidelines.  Classic
Series funds invest across asset classes and sectors,
utilizing a range of strategies in order to achieve
their objectives.

	Index Series - funds that track the market
Our Index funds are designed to provide investment
results that track, as closely as possible, the
performance of a stock or bond market index.  This
strategy distinguishes an index fund from an "actively
managed" mutual fund.  Instead of trying to outperform
a market or segment, a portfolio manager looks to an
index to determine which securities the fund should
own.






	Premier Selections Series - our best ideas,
concentrated funds
We offer a series of Premier Selections funds managed
by several of our most experienced and proven
managers.  This series of funds is built on a unique
strategy of combining complementary investment
management styles to create broader, multiclass and
multicap products that are distinguished by a highly
concentrated focus.

Research Series - driven by exhaustive fundamental
securities analysis
Built on a foundation of substantial buy-side research
under the direction of our Citibank Global Asset
Management (CGAM) colleagues, our Research funds focus
on well-defined industries, sectors and trends.

Style Pure Series - our solution to funds that stray
Our Style Pure Series funds are the building blocks of
asset allocation.  The funds stay fully invested
within their asset class and investment style,
enabling you to make asset allocation decisions in
conjunction with your financial professional.


































SMITH BARNEY
SECTOR SERIES INC.



Financial Services Fund

Health Sciences Fund

Technology Fund

















February 28, 2001



SMITH BARNEY SECTOR SERIES INC.
7 World Trade Center
New York, NY 10048

SALOMON SMITH BARNEY
February 28, 2001

STATEMENT OF ADDITIONAL INFORMATION

SMITH BARNEY SECTOR SERIES INC.

Smith Barney Global Biotechnology Fund
Smith Barney Global Media & Telecommunications Fund
Smith Barney Global Technology Fund

7 World Trade Center,
New York, New York 10048
(800) 451-2010

This Statement of Additional Information ("SAI") is meant to
be read in conjunction with the combined prospectus of Smith
Barney Global Biotechnology Fund ("Global Biotechnology
Fund"), Smith Barney Global Media & Telecommunications Fund
("Global Media & Telecommunications Fund") and Smith Barney
Global Technology Fund ("Global Technology Fund") (each, a
"Fund") dated February 28, 2001, as amended or supplemented
from time to time (the "prospectus"), and is incorporated by
reference in its entirety into the prospectus.  Each Fund is
a series of the Smith Barney Sector Series Inc. (the
"Company") which also offers three other series: Smith
Barney Financial Services Fund, Smith Barney Health Sciences
Fund and Smith Barney Technology Fund. The prospectus and
copies of other information on the Funds may be obtained
free of charge by contacting a Salomon Smith Barney
Financial Consultant, a broker/dealer, financial
intermediary, financial institution (each called a "Service
Agent") or by writing or calling the Company at the address
or telephone number above.

TABLE OF CONTENTS
Investment Objective and Management Policies	2
Risk Factors	8
Investment Restrictions	19
Directors and Executive Officers of the Company	20
Investment Management and Other Services	23
Portfolio Transactions	29
Portfolio Turnover	30
Purchase of Shares	31
Redemption of Shares	39
Valuation of Shares	40
Exchange Privilege	41
Performance Information	42
Dividends, Distributions and Taxes	47
Other Information About the Company	52
Financial Statements	54
Other Information	54

INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES

The prospectus discusses each Fund's investment objective
and policies. This section contains supplemental information
concerning the types of securities and other instruments in
which each Fund may invest, the investment policies and
portfolio strategies each Fund may utilize and certain risks
associated with these investments, policies and strategies.
SSB Citi Fund Management LLC ("SSB Citi" or the "Manager")
serves as Investment Manager to each Fund. Citibank, N.A.,
an affiliate of the Manager, through its Citibank Global
Asset Management division ("CGAM" or the "Subadviser"),
serves as the sub-adviser to each Fund.

Global Biotechnology Fund

Global Biotechnology Fund seeks long-term capital
appreciation by investing primarily in common stocks. The
Fund invests at least 80% of its assets in securities of
companies principally engaged in the research, development,
and manufacture of various biotechnological and biomedical
products, services, technology and processes.  The Fund will
also invest in securities of companies that distribute
biotechnological and biomedical products and companies that
benefit significantly from scientific and technological
advances in biotechnology. These companies may include, but
are not limited to, the following: companies involved with
such areas as genomics, genetic engineering, and gene
therapy; health care; pharmaceuticals; agricultural and
veterinary; chemicals; medical/surgical; and industrial.
They may also include companies that manufacture
biotechnological and biomedical products, including devices
and instruments; companies that provide biotechnological
processes or services; companies that provide scientific and
technological advances in biotechnology; and companies
involved with new or experimental technologies related to
any of the above.

Global Media & Telecommunications Fund

Global Media & Telecommunications Fund seeks long-term
capital appreciation by investing primarily in common
stocks. The Fund invests at least 80% of its assets in
securities of companies principally engaged in the
following: the development, production, sale, syndication,
distribution and transmission of goods or services used in
the broadcast and media industries; the development,
manufacture, or sale of communications services or
communications equipment. The media and telecommunications
sector includes, without limitation, advertising companies;
companies that own, operate, broadcast or provide access to
the following: free or pay television; radio; cable
stations; theaters; film studios; television, movie and
Internet programming; publishers, sellers or printers of
newspapers, magazines, books, or video products; printing,
cable television and video equipment providers; the
broadcast and media industries; companies involved in the
development, syndication, and transmission of television,
movie programming, advertising, Internet, wireless and
cellular communications; companies that offer local and
long-distance telephone service or equipment, wireless
communications, satellite communications; or companies
principally engaged in the development, manufacture, or sale
of communications services or communications equipment. The
companies may include companies that provide the following:
Internet, wireless, cellular, paging, and local and wide
area product networks, service or equipment; microwave and
cable television equipment; and technologies such as fiber
optics, semiconductors, and data transmission; and companies
that distribute data-base information; and other companies
involved in the ownership, operation, or development of
media and telecommunications products or services.

Global Technology Fund

Global Technology Fund seeks long-term capital appreciation
by investing its assets primarily in common stocks. The Fund
normally invests at least 80% of its assets in securities of
companies principally engaged in offering, using or
developing products, processes or services that will provide
or will benefit significantly from technological advances
and improvements. These companies may include, but are not
limited to, companies that develop, produce or distribute
products or services in the computer, semi-conductor,
software, electronics, media, communications, Internet,
health care, and biotechnology sectors. Industries likely to
be included in the Fund are communications-telephone, data,
and wireless; Internet infrastructure; e-commerce and data
services; semi-conductors-components and equipment;
computer-hardware and software; and media and entertainment.

Each Fund

Each Fund may invest its assets in securities of domestic
and/or foreign issuers. Each Fund may invest without
limitation in securities of foreign issuers and will invest
in securities of issuers located in at least three
countries, including the United States. Because each Fund is
considered non-diversified, the Fund may invest a
significant percentage of its assets in a single issuer.

In buying and selling securities for each Fund, the
Subadviser relies on fundamental analysis of each issuer and
its potential for success in light of its current financial
condition and its industry position. Factors considered
include long-term growth potential, earnings estimates and
quality of management.

The Subadviser may lend each Fund's securities to broker-
dealers or other institutions to earn income for the Fund.
The Subadviser may, but is not required to, use various
techniques, such as buying and selling futures and options
contracts, to increase or decrease a Fund's exposure to
changing security prices or other factors that affect
security values. If the Subadviser's strategies do not work
as intended, a Fund may not achieve its objective.

Under normal market conditions, the majority of a Fund's
portfolio will consist of equity securities, but it also may
contain money market instruments for cash management
purposes.  Each Fund reserves the right, as a defensive
measure, to hold money market securities, including
repurchase agreements or cash, in such proportions as, in
the opinion of management, prevailing market or economic
conditions warrant. If a Fund takes a temporary defensive
position, it may be unable to achieve its investment goal.

Equity Securities.  Each Fund will normally invest at least
80% of its assets in equity securities, including primarily
common stocks and, to a lesser extent, securities
convertible into common stock and rights to subscribe for
common stock. Common stocks 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.

When-Issued Securities, Delayed-Delivery Transactions and
Forward Commitments.  Each Fund may purchase securities on a
"when-issued" basis, for delayed delivery (i.e., payment or
delivery occur beyond the normal settlement date at a stated
price and yield) or on a forward commitment basis.  A Fund
does not intend to engage in these transactions for
speculative purposes, but only in furtherance of its
investment goal.  These transactions occur when securities
are purchased or sold by a Fund with payment and delivery
taking place in the future to secure what is considered an
advantageous yield and price to a Fund at the time of
entering into the transaction.  The payment obligation and
the interest rate that will be received on when-issued
securities are fixed at the time the buyer enters into the
commitment.  Because of fluctuations in the value of
securities purchased or sold on a when-issued,
delayed-delivery basis or forward commitment basis, the
prices obtained on such securities may be higher or lower
than the prices available in the market on the dates when
the investments are actually delivered to the buyers.
When the Fund agrees to purchase when-issued or delayed-
delivery securities or securities on a forward commitment
basis, the Fund will set aside cash or liquid securities
equal to the amount of the commitment in a segregated
account on the Fund's books.  Normally, the custodian will
set aside portfolio securities to satisfy a purchase
commitment, and in such a case the Fund may be required
subsequently to place additional assets in the segregated
account in order to ensure that the value of the account
remains equal to the amount of the Fund's commitment. The
assets contained in the segregated account will be marked-
to-market daily.  It may be expected that the Fund's net
assets will fluctuate to a greater degree when it sets aside
portfolio securities to cover such purchase commitments than
when it sets aside cash.  When the Fund engages in
when-issued, delayed-delivery or forward commitment
transactions, it relies on the other party to consummate the
trade.  Failure of the seller to do so may result in the
Fund's incurring a loss or missing an opportunity to obtain
a price considered to be advantageous.

Foreign Securities. Foreign securities involve certain risks
not ordinarily associated with investments in securities of
domestic issuers. Such risks include currency exchange
control regulations and costs, the possibility of
expropriation, seizure, or nationalization of foreign
deposits, less liquidity and volume and more volatility in
foreign securities markets and the impact of political,
social, economic or diplomatic developments or the adoption
of other foreign government restrictions that might
adversely affect the payment of principal and interest on,
or market value, of securities.  If it should become
necessary, the Fund might encounter greater difficulties in
invoking legal processes abroad than would be the case in
the United States.  In addition, there may be less publicly
available information about a non-U.S. company, and non-U.S.
companies are not generally subject to uniform accounting
and financial reporting standards, practices and
requirements comparable to those applicable to U.S.
companies.  Furthermore, some of these securities may be
subject to foreign brokerage and withholding taxes.

Each Fund may also invest in securities of foreign issuers
in the form of American Depository Receipts ("ADRs"),
European Depository Receipts ("EDRs") or similar securities
representing interests in the common stock of foreign
issuers.  ADRs are receipts, typically issued by a U.S. bank
or trust company, which evidence ownership of underlying
securities issued by a foreign corporation. EDRs are
receipts issued in Europe which evidence a similar ownership
arrangement. Generally, ADRs, in registered form, are
designed for use in the U.S. securities markets and EDRs are
designed for use in European securities markets. The
underlying securities are not always denominated in the same
currency as the ADRs or EDRs. Although investment in the
form of ADRs or EDRs facilitates trading in foreign
securities, it does not mitigate the risks associated with
investing in foreign securities.  However, by investing in
ADRs or EDRs rather than directly in foreign issuers' stock,
a Fund can avoid currency risks during the settlement period
for either purchases or sales.  In general, there is a
large, liquid market in the United States for many ADRs and
EDRs.  The information available for ADRs and EDRs is
subject to the accounting, auditing and financial reporting
standards of the domestic market or exchange on which they
are traded, which standards are more uniform and more
exacting than those to which many foreign issuers may be
subject.

Investments in foreign securities incur higher costs than
investments in U.S. securities, including higher costs in
making securities transactions as well as foreign government
taxes, which may reduce the investment return of the Fund.
In addition, foreign investments may include additional
risks associated with currency exchange rates, less complete
financial information about individual companies, less
market liquidity and political instability.

Currency Risks.  The U.S. dollar value of securities
denominated in a foreign currency will vary with changes in
currency exchange rates, which can be volatile.
Accordingly, changes in the value of the currency in which a
Fund's investments are denominated relative to the U.S.
dollar will affect the Fund's net asset value.  Exchange
rates are generally affected by the forces of supply and
demand in the international currency markets, the relative
merits of investing in different countries and the
intervention or failure to intervene of U.S. or foreign
governments and central banks.  However, currency exchange
rates may fluctuate based on factors intrinsic to a
country's economy.  Some emerging market countries also may
have managed currencies, which are not free floating against
the U.S. dollar.  In addition, emerging markets are subject
to the risk of restrictions upon the free conversion of
their currencies into other currencies.  Any devaluations
relative to the U.S. dollar in the currencies in which a
Fund's securities are quoted would reduce the Fund's net
asset value per share.

Securities of Developing/Emerging Markets Countries.   A
developing or emerging markets country generally is
considered to be a country that is in the initial stages of
its industrialization cycle. Investing in the equity markets
of developing countries involves exposure to economic
structures that are generally less diverse and mature, and
to political systems that can be expected to have less
stability, than those of developed countries. Historical
experience indicates that the markets of developing
countries have been more volatile than the markets of the
more mature economies of developed countries; however, such
markets often have provided higher rates of return to
investors.

One or more of the risks discussed above could affect
adversely the economy of a developing market or a Fund's
investments in such a market.  The claims of many property
owners against those of governments may remain unsettled.
There can be no assurance that any investments that a Fund
might make in such emerging markets would be expropriated,
nationalized or otherwise confiscated at some time in the
future. In such an event, the Fund could lose its entire
investment in the market involved.  Moreover, changes in the
leadership or policies of such markets could halt the
expansion or reverse the liberalization of foreign
investment policies now occurring in certain of these
markets and adversely affect existing investment
opportunities.

Economic and Monetary Union (EMU) EMU began on January 1,
1999 when 11 European countries adopted a single currency-
the Euro.  EMU may create new economic opportunities for
investors, such as lower interest rates, easier cross-border
mergers, acquisitions and similar restructurings, more
efficient distribution and product packaging and greater
competition.  Budgetary decisions remain in the hands of
each participating country, but are subject to each
country's comitment to avoid "excessive deficits" and other
more specific a budgetary criteria.  A European Central Bank
is responsible for setting the official interest rate within
the Euro zone.  EMU and the introduction of the Euro,
however, present unique risks and uncertainties for
investors in EMU-participating countries, including:  (i)
monetary and economic union on this scale has never before
been attempted; (ii) there is uncertainty whether
participating countries will remain committed to EMU in the
face of changing economic conditions; (iii) instability
within EMU may increase the volatility of European markets
and may adversely affect the prices of securities of
European issuers in the funds' portfolios; (iv) there is
uncertainty concerning the fluctuation of the Euro relative
to non-Euro currencies during the transition period from
January 1, 1999 and beyond; and (v) there is no assurance
that interest rate, tax and labor regimes of EMU-
participating countries will converge onver time.  These and
other factors may cause market disruption and could
adversely affect European securities and currencies held by
the funds.

Money Market Instruments. Each Fund may invest for temporary
defensive purposes in short-term corporate and government
bonds and notes and money market instruments.  Money market
instruments include: obligations issued or guaranteed by the
United States government, its agencies or instrumentalities
("U.S. government securities"); certificates of deposit,
time deposits and bankers' acceptances issued by domestic
banks (including their branches located outside the United
States and subsidiaries located in Canada), domestic
branches of foreign banks, savings and loan associations and
similar institutions; high grade commercial paper; and
repurchase agreements with respect to the foregoing types of
instruments. Certificates of deposit ("CDs") are short-term,
negotiable obligations of commercial banks. Time deposits
("TDs") are non-negotiable deposits maintained in banking
institutions for specified periods of time at stated
interest rates.  Bankers' acceptances are time drafts drawn
on commercial banks by borrowers, usually in connection with
international transactions.

Repurchase Agreements.  Each Fund may agree to purchase
securities from a bank or recognized securities dealer and
simultaneously commit to resell the securities to the bank
or dealer at an agreed-upon date and price reflecting a
market rate of interest unrelated to the coupon rate or
maturity of the purchased securities ("repurchase
agreements"). The Fund would maintain custody of the
underlying securities prior to their repurchase; thus, the
obligation of the bank or dealer to pay the repurchase price
on the date agreed to would be, in effect, secured by such
securities.  If the value of such securities were less than
the repurchase price, plus interest, the other party to the
agreement would be required to provide additional collateral
so that at all times the collateral is at least 102% of the
repurchase price plus accrued interest.  Default by or
bankruptcy of a seller would expose the Fund to possible
loss because of adverse market action, expenses and/or
delays in connection with the disposition of the underlying
obligations.  The financial institutions with which the Fund
may enter into repurchase agreements will be banks and non-
bank dealers of U.S. government securities on the Federal
Reserve Bank of New York's list of reporting dealers, if
such banks and non-bank dealers are deemed creditworthy by
the Fund's Manager or the Subadviser. The Manager or the
Subadviser will continue to monitor creditworthiness of the
seller under a repurchase agreement, and will require the
seller to maintain during the term of the agreement the
value of the securities subject to the agreement to equal at
least 102% of the repurchase price (including accrued
interest).  In addition, the Manager or the Subadviser will
require that the value of this collateral, after transaction
costs (including loss of interest) reasonably expected to be
incurred on a default, be equal to 102% or greater than the
repurchase price (including accrued premium) provided in the
repurchase agreement or the daily amortization of the
difference between the purchase price and the repurchase
price specified in the repurchase agreement. The Manager or
the Subadviser will mark-to-market daily the value of the
securities.  Repurchase agreements are considered to be
loans by the Fund under the Investment Company Act of 1940,
as amended (the "1940 Act").
Reverse Repurchase Agreements.  Each Fund may enter into
reverse repurchase agreements which involve the sale of Fund
securities with an agreement to repurchase the securities at
an agreed-upon price, date and interest payment and have the
characteristics of borrowing.  Since the proceeds of
borrowings under reverse repurchase agreements are invested,
this would introduce the speculative factor known as
"leverage."  The securities purchased with the funds
obtained from the agreement and securities collateralizing
the agreement will have maturity dates no later than the
repayment date.  Generally the effect of such a transaction
is that the Fund can recover all or most of the cash
invested in the portfolio securities involved during the
term of the reverse repurchase agreement, while in many
cases it will be able to keep some of the interest income
associated with those securities.  Such transactions are
only advantageous if the Fund has an opportunity to earn a
greater rate of interest on the cash derived from the
transaction than the interest cost of obtaining that cash.
Opportunities to realize earnings from the use of the
proceeds equal to or greater than the interest required to
be paid may not always be available, and the Fund intends to
use the reverse repurchase technique only when the
Subadviser believes it will be advantageous to the Fund.
The use of reverse repurchase agreements may exaggerate any
interim increase or decrease in the value of the Fund's
assets.  The Fund's custodian bank will maintain a separate
account for the Fund with securities having a value equal to
or greater than such commitments.
Lending of Portfolio Securities.  Consistent with applicable
regulatory requirements, each Fund may lend portfolio
securities to brokers, dealers and other financial
organizations that meet capital and other credit
requirements or other criteria established by the Board.
The Fund will not lend portfolio securities to affiliates of
the Manager unless they have applied for and received
specific authority to do so from the Securities and Exchange
Commission ("SEC").  Loans of portfolio securities will be
collateralized by cash, letters of credit or liquid
securities, which are maintained at all times in an amount
equal to at least 102% of the current market value of the
loaned securities.  Any gain or loss in the market price of
the securities loaned that might occur during the term of
the loan would be for the account of the Fund.  From time to
time, the Fund may return a part of the interest earned from
the investment of collateral received for securities loaned
to the borrower and/or a third party that is unaffiliated
with the Fund and that is acting as a "finder."
By lending its securities, a Fund can increase its income by
continuing to receive interest and any dividends on the
loaned securities as well as by either investing the
collateral received for securities loaned in short-term
instruments or obtaining yield in the form of interest paid
by the borrower when U.S. government securities are used as
collateral.  Although the generation of income is not the
primary investment goal of the Fund, income received could
be used to pay the Fund's expenses and would increase an
investor's total return. The Fund will adhere to the
following conditions whenever its portfolio securities are
loaned: (i) the Fund must receive at least 102% cash
collateral or equivalent securities of the type discussed in
the preceding paragraph from the borrower; (ii) the borrower
must increase such collateral whenever the market value of
the securities rises above the level of such collateral;
(iii) the Fund must be able to terminate the loan at any
time; (iv) the Fund must receive reasonable interest on the
loan, as well as any dividends, interest or other
distributions on the loaned securities and any increase in
market value; (v) the Fund may pay only reasonable custodian
fees in connection with the loan; and (vi) voting rights on
the loaned securities may pass to the borrower, provided,
however, that if a material event adversely affecting the
investment occurs, the Board must terminate the loan and
regain the right to vote the securities.  Loan agreements
involve certain risks in the event of default or insolvency
of the other party including possible delays or restrictions
upon a Fund's ability to recover the loaned securities or
dispose of the collateral for the loan.
Borrowing.  Each Fund also may borrow for temporary or
emergency purposes, but not for leveraging purposes, in an
amount up to 331/3% of its total assets, and may pledge its
assets in connection with such borrowings. If a Fund borrows
money, its share price may be subject to greater fluctuation
until the borrowing is paid off.  If a Fund makes additional
investments while borrowings are outstanding, this may be
considered a form of leverage.

Illiquid Securities.  Each Fund may invest up to an
aggregate amount of 15% of its net assets in illiquid
securities, which term includes securities subject to
contractual or other restrictions on resale and other
instruments that lack readily available markets.

RISK FACTORS

Companies in the each sector face special risks. For
example, their products or services may not prove
commercially successful or may become obsolete quickly. The
value of a Fund's shares may be susceptible to factors
affecting the technology and science areas and to greater
risk and market fluctuation than an investment in a fund
that invests in a broader range of portfolio securities not
concentrated in any particular industry. As such, a Fund is
not an appropriate investment for individuals who are not
long-term investors and who, as their primary objective,
require safety of principal or stable income from their
investments. Each sector may be subject to greater
governmental regulation than many other areas and changes in
governmental policies and the need for regulatory approvals
may have a material adverse effect on these areas.
Additionally, companies in each sector may be subject to
risks of developing technologies, competitive pressures and
other factors and are dependent upon consumer and business
acceptance as new technologies evolve.

The types of companies in which a Fund invests present
risks. The market may value companies according to size, or
market capitalization, rather than on financial performance.
The companies in each sector may be developing or changing.
They may be subject to greater business risks and more
sensitive to changes in economic conditions than larger,
more established companies.  Company earnings in these
sectors may fluctuate more than those of other companies
because of short product cycles and competitive pricing.
Investors' enthusiasm for these stocks can also change
dramatically, causing stock prices to rise and fall sharply.

Global Biotechnology Fund

Patent considerations, intense competition, rapid
technological change and obsolescence, and government
regulation can and adversely affect the biotechnology
sector. Biotechnology companies can have persistent losses
during a new product's transition from development to
production, and revenue patterns can be erratic.
Biotechnology companies may have persistent losses during a
new product's transition from development to production, and
revenue patterns may be erratic. The sector will be affected
by government regulatory requirements, regulatory approval
for new drugs and medical products, patent considerations,
product liability, and similar matters. In addition, this
industry is characterized by competition and rapid
technological developments which may make a company's
products or services obsolete in a short period of time.  As
these factors impact the biotechnology industry, the value
of your shares may fluctuate significantly over relatively
short periods of time.

Global Media & Telecommunications Fund

Companies in the media and telecommunications sector are
subject to the risks of rapid obsolescence, lack of investor
or consumer acceptance, lack of standardization or
compatibility with existing technologies, an unfavorable
regulatory environment, intense competition, and a
dependency on patent and copyright protection.  The media
sector can be significantly (and adversely) affected by the
government deregulation of cable and broadcasting,
competitive pressures, and government regulation, including
regulation of the concentration of investment in AM, FM, or
TV stations. The telecommunications industry, particularly
telephone operating companies, is subject to government
regulations of rates of return and services that may be
offered. Many telecommunications companies fiercely compete
for market share.

The telecommunications industry is subject to governmental
regulation and greater price volatility than the overall
market and the products and services of telecommunications
companies may be subject to rapid obsolescence resulting
from changing consumer tastes, intense competition and
strong market reactions to technological developments
throughout the industry.  Certain companies in the United
States, for example, are subject to government regulations
affecting permitted rates of return and the kinds of
services that may be offered.  Such companies are becoming
subject to increasing levels of competition.  As a result,
stocks of these companies may be subject to greater price
volatility.

Companies in the communications, entertainment, media and
publishing industries are subject to governmental
regulation and a greater price  volatility than the overall
market and the  products  and  services  of such  companies
may be  subject  to  rapid obsolescence  resulting from
changing consumer tastes,  intense  competition and strong
market reactions to technological developments throughout
the industry.

Certain of the companies in which the Fund invests may
allocate greater than usual financial resources to research
and product development. The securities of such companies
may experience above-average price movements associated with
the perceived prospects of success of the research and
development programs.  In addition, companies in which the
Fund invests may be adversely affected by lack of commercial
acceptance of a new product or process or by technological
change and obsolescence.

Global Technology Fund

Many technological products and services are subject to
rapid obsolescence, which may lower the market value of the
securities of the companies in this sector.  Also, the
portfolio may include faster-growing, more volatile
technology companies that the Subadviser believes to be
emerging leaders in their fields. In addition, technology
stocks historically have experienced unusually wide price
swings. The market prices of these companies tend to rise
and fall more rapidly than those of larger, more established
companies The potential for wide variation in performance
reflects the special risks common to companies in the
rapidly changing field of technology. For example, products
or services that at first appear promising may not prove
commercially successful or may become obsolete quickly.
Earnings disappointments and intense competition for market
share can result in sharp price declines.

Sector Risks. The Subadviser believes that because of rapid
advances in each sector, an investment in companies with
business operations in these areas may offer substantial
opportunities for long-term capital appreciation. Of course,
prices of common stocks of even the best managed, most
profitable corporations are subject to market risk, which
means their stock prices can decline. In addition, swings in
investor psychology or significant trading by investors can
result in price fluctuations. Industries likely to be owned
by the Funds include computers, networking and
internetworking software, computer aided design,
telecommunications, media and information services, medical
devices and biotechnology. A Fund may also invest in the
stocks of companies that may benefit from the
commercialization of technological advances, although they
may not be directly involved in research and development.
The sectors have exhibited and may continue to exhibit rapid
growth, both through increasing demand for existing products
and services and the broadening of the sector. In general,
the stocks of large capitalized companies that are well
established in the sector can be expected to grow with the
market and will frequently be found in a Fund's portfolio.
The expansion of each sector and its related industries,
however, also provides a favorable environment for
investment in small to medium capitalized companies. A
Fund's investment policy is not limited to any minimum
capitalization requirement and a Fund may hold securities
without regard to the capitalization of the issuer. The
Subadviser's overall stock selection for a Fund is not based
on the capitalization or size of the company but rather on
an assessment of the company's fundamental prospects.

Risks Associated with Particular Investments

Market Risk.  Equity stock prices vary and may fall, thus
reducing the value of a Fund's investment.  Certain stocks
selected for any Fund's portfolio may decline in value more
than the overall stock market.

Foreign Securities.  Investments in foreign and emerging
markets carry special risks, including currency, political,
regulatory and diplomatic risks. Each Fund may invest
without limitation in securities of foreign issuers and will
invest in securities of issuers located in at least three
countries, including the U.S.

Many countries impose various types of ownership
restrictions on investments both in mass media companies,
such as broadcasters and cable operators, as well as in
common carrier companies, such as the providers of local and
cellular telephone service.  Government actions around the
world, specifically in the area of pre-marketing clearance
of products and prices, can be arbitrary and unpredictable.
Changes in world currency values are also unpredictable and
can have a significant short-term impact on revenues,
profits and share valuations.

Currency Risk.  A change in the exchange rate between U.S.
dollars and a foreign currency may reduce the value of a
Fund's investment in a security valued in the foreign
currency, or based on that currency value.

Political and Diplomatic Risk.  Political actions, events or
instability may result in unfavorable changes in the value
of a security.  In addition, a change in diplomatic
relations between the U.S. and a foreign country could
affect the value or liquidity of investments.

Regulatory Risk.  Government regulations may affect the
value of a security. In foreign countries, securities
markets that are less regulated than those in the U.S. may
permit trading practices that are not allowed in the U.S.

Liquidity Risk.  A Fund's portfolio is liquid if the Fund is
able to sell the securities it owns at a fair price within a
reasonable time. Liquidity is generally related to the
market trading volume for a particular security.
Investments in smaller companies or in foreign companies or
companies in emerging markets are subject to a variety of
risks, including potential lack of liquidity.

Smaller Capitalized Companies.  The Subadviser believes that
smaller capitalized companies generally have greater
earnings and sales growth potential than larger capitalized
companies. The level of risk will be increased to the extent
each Fund has significant exposure to smaller capitalized or
unseasoned companies (those with less than a three-year
operating history). Investments in smaller capitalized
companies may involve greater risks, such as limited product
lines, markets and financial or managerial resources. In
addition, less frequently traded securities may be subject
to more abrupt price movements than securities of larger
capitalized companies.

Derivatives Risk.  A Fund's use of options, futures and
options on futures ("derivatives") involves additional risks
and transaction costs, such as, (i) adverse changes in the
value of these instruments, (ii) imperfect corrrelation
between the price of derivatives and movements in the price
of the underlying securities, index or futures contracts,
(iii) the fact that use of derivatives requires different
skills than those needed to select portfolio securities, and
(iv) the possible absence of a liquid secondary market for a
particular derivative at any moment in time.

Counterparty Risk.  This is a risk associated primarily with
repurchase agreements and some derivatives transactions.  It
is the risk that the other party in such a transaction will
not fulfill its contractual obligation to complete a
transaction with a Fund.

Lack of Timely Information Risk. Timely information about a
security or its issuer may be unavailable, incomplete or
inaccurate.  This risk is more common to smaller company
securities issued by foreign companies and companies in
emerging markets than it is to the securities of U.S.-based
companies.

Non-Diversified Classification.  Each Fund is classified as
a non-diversified fund under the 1940 Act which means the
Fund is not limited by the Act in the proportion of its
assets it may invest in the obligations of a single issuer.
As a result, the Funds may be subject to greater volatility
with respect to their portfolio securities than funds that
are more broadly diversified. Each Fund intends to conduct
its operations, however, so as to qualify as a "regulated
investment company" for purposes of the Internal Revenue
Code of 1986, as amended (the "Code"), which will relieve
the Fund of any liability for Federal income tax to the
extent its earnings are distributed to shareholders.  To
qualify as a regulated investment company, the Fund will,
among other things, limit its investments so that, at the
close of each quarter of the taxable year (a) not more than
25% of the market value of the Fund's total assets will be
invested in the securities of a single issuer and (b) with
respect to 50% of the market value of its total assets, not
more than 5% of the market value of its total assets will be
invested in the securities of a single issuer and the Fund
will not own more than 10% of the outstanding voting
securities of a single issuer.

Master/feeder fund structure.  The Board of Directors has
the discretion to retain the current distribution
arrangement for the Funds while investing their assets in a
master fund in a master/feeder fund structure.  A
master/feeder fund structure is one in which a fund (a
"feeder fund"), instead of investing directly in a portfolio
of securities, invests most or all of its investment assets
in a separate registered investment company (the "master
fund") with substantially the same investment objective and
policies as the feeder fund.  Such a structure permits the
pooling of assets of two or more feeder funds, preserving
separate identities or distribution channels at the feeder
fund level.  Based on the premise that certain of the
expenses of operating an investment portfolio are relatively
fixed, a larger investment portfolio may eventually achieve
a lower ratio of operating expenses to average net assets.
An existing investment company is able to convert to a
feeder fund by selling all of its investments, which
involves brokerage and other transaction costs and
realization of a taxable gain or loss, or by contributing
its assets to the master fund and avoiding transaction costs
and, if proper procedures are followed, the realization of
taxable gain or loss.

Options, Futures and Currency Strategies.  Each Fund may,
but is not required to, use forward currency contracts and
certain options and futures strategies for any of the
following purposes: to seek to increase total return or
hedge its portfolio, i.e., reduce the overall level of
investment risk normally associated with a Fund; to settle
transactions in securities quoted in foreign currencies; as
a substitute for buying or selling securities; or as a cash
flow management technique.  There can be no assurance that
such efforts will succeed.

In order to assure that a Fund will not be deemed to be a
"commodity pool" for purposes of the Commodity Exchange Act,
regulations of the Commodity Futures Trading Commission
("CFTC") require that a Fund enter into transactions in
futures contracts and options on futures only (i) for bona
fide hedging purposes (as defined in CFTC regulations), or
(ii) for non-hedging purposes, provided the aggregate
initial margin and premiums on such non-hedging positions do
not exceed 5% of the liquidation value of a Fund's assets.
To attempt to hedge against adverse movements in exchange
rates between currencies, a Fund may enter into forward
currency contracts for the purchase or sale of a specified
currency at a specified future date. Such contracts may
involve the purchase or sale of a foreign currency against
the U.S. dollar or may involve two foreign currencies.  A
Fund may enter into forward currency contracts either with
respect to specific transactions or with respect to its
portfolio positions.  For example, when the Subadviser
anticipates making a purchase or sale of a security, it may
enter into a forward currency contract in order to set the
rate (either relative to the U.S. dollar or another
currency) at which the currency exchange transaction related
to the purchase or sale will be made ("transaction
hedging").  Further, when the Subadviser believes a
particular currency may decline compared to the U.S. dollar
or another currency, a Fund may enter into a forward
contract to sell the currency the Subadviser expects to
decline in an amount approximating the value of some or all
of a Fund's securities denominated in that currency, or when
the Subadviser believes one currency may decline against a
currency in which some or all of the portfolio securities
held by a Fund are denominated, it may enter into a forward
contract to buy the currency expected to decline for a fixed
amount ("position hedging").  In this situation, a Fund may,
in the alternative, enter into a forward contract to sell a
different currency for a fixed amount of the currency
expected to decline where the Subadviser believes the value
of the currency to be sold pursuant to the forward contract
will fall whenever there is a decline in the value of the
currency in which portfolio securities of a Fund are
denominated ("cross hedging"). A Fund places (i) cash, (ii)
U.S. government securities or (iii) equity securities or
debt securities (of any grade) in certain currencies
provided such assets are liquid, unencumbered and marked to
market daily, or other high-quality debt securities
denominated in certain currencies in a separate account of
the Fund having a value equal to the aggregate amount of the
Fund's commitments under forward contracts entered into with
respect to position hedges and cross-hedges. If the value of
the securities placed in a separate account declines,
additional cash or securities are placed in the account on a
daily basis so that the value of the account will equal the
amount of the Fund's commitments with respect to such
contracts.

For hedging purposes, a Fund may write covered call options
and purchase put and call options on currencies to hedge
against movements in exchange rates and on debt securities
to hedge against the risk of fluctuations in the prices of
securities held by the Fund or which the Subadviser intends
to include in its portfolio. A Fund also may use interest
rates futures contracts and options thereon to hedge against
changes in the general level in interest rates.

A Fund may write call options on securities and currencies
only if they are covered, and such options must remain
covered so long as the Fund is obligated as a writer.  A
call option written by a Fund is "covered" if the Fund owns
the securities or currency underlying the option or has an
absolute and immediate right to acquire that security or
currency without additional cash consideration (or for
additional cash consideration held in a segregated account
on the Fund's books) upon conversion or exchange of other
securities or currencies held in its portfolio. A call
option is also covered if the Fund holds on a share-for-
share basis a call on the same security or holds a call on
the same currency as the call written where the exercise
price of the call held is equal to less than the exercise
price of the call written or greater than the exercise price
of the call written if the difference is maintained by the
Fund in cash, Treasury bills or other high-grade, short-term
obligations in a segregated account on the Fund's books.

A Fund may purchase put and call options in anticipation of
declines in the value of portfolio securities or increases
in the value of securities to be acquired.  If the expected
changes occur, the Fund may be able to offset the resulting
adverse effect on its portfolio, in whole or in part,
through the options purchased. The risk assumed by a Fund in
connection with such transactions is limited to the amount
of the premium and related transaction costs associated with
the option, although the Fund may lose such amounts if the
prices of securities underlying the options do not move in
the direction or to the extent anticipated.

Although a Fund may not use forward currency contracts,
options and futures, the use of any of these strategies
would involve certain investment risks and transaction
costs. These risks include: dependence on the Subadviser's
ability to predict movements in the prices of individual
securities, fluctuations in the general fixed-income markets
and movements in interest rates and currency markets,
imperfect correlation between movements in the price of
currency, options, futures contracts or options thereon and
movements in the price of the currency or security hedged or
used for cover; the fact that skills and techniques needed
to trade options, futures contracts and options thereon or
to use forward currency contracts are different from those
needed to select the securities in which a Fund invests; and
lack of assurance that a liquid market will exist for any
particular option, futures contract or option thereon at any
particular time.

Over-the-counter options in which a Fund may invest differ
from exchange traded options in that they are two-party
contracts, with price and other terms negotiated between
buyer and seller, and generally do not have as much market
liquidity as exchange-traded options.  A Fund may be
required to treat as illiquid over-the-counter options
purchased and securities being used to cover certain written
over-the-counter options.

Options on Securities.  As discussed more generally above,
each Fund may engage in writing covered call options. Each
Fund may also purchase put options and enter into closing
transactions. The principal reason for writing covered call
options on securities is to attempt to realize, through the
receipt of premiums, a greater return than would be realized
on the securities alone. In return for a premium, the writer
of a covered call option forgoes the right to any
appreciation in the value of the underlying security above
the strike price for the life of the option (or until a
closing purchase transaction can be effected). Nevertheless,
the call writer retains the risk of a decline in the price
of the underlying security. Similarly, the principal reason
for writing covered put options is to realize income in the
form of premiums. The writer of a covered put option accepts
the risk of a decline in the price of the underlying
security. The size of the premiums the Fund may receive may
be adversely affected as new or existing institutions,
including other investment companies, engage in or increase
their option-writing activities.

Options written by the Fund will normally have expiration
dates between one and six months from the date written. The
exercise price of the options may be below, equal to, or
above the current market values of the underlying securities
when the options are written. In the case of call options,
these exercise prices are referred to as "in-the-money,"
"at-the-money" and "out-of-the-money," respectively.

A Fund may write (a) in-the-money call options when the
Subadviser expects the price of the underlying security to
remain flat or decline moderately during the option period,
(b) at-the-money call options when the Subadviser expects
the price of the underlying security to remain flat or
advance moderately during the option period and (c) out-of-
the-money call options when the Subadviser expects that the
price of the security may increase but not above a price
equal to the sum of the exercise price plus the premiums
received from writing the call option. In any of the
preceding situations, if the market price of the underlying
security declines and the security is sold at this lower
price, the amount of any realized loss will be offset wholly
or in part by the premium received. Out-of-the-money, at-
the-money and in-the-money put options (the reverse of call
options as to the relation of exercise price to market
price) may be utilized in the same market environments as
such call options are used in equivalent transactions.

So long as the obligation of a Fund as the writer of an
option continues, the Fund may be assigned an exercise
notice by the broker-dealer through which the option was
sold, requiring it to deliver, in the case of a call, or
take delivery of, in the case of a put, the underlying
security against payment of the exercise price. This
obligation terminates when the option expires or the Fund
effects a closing purchase transaction. The Fund can no
longer effect a closing purchase transaction with respect to
an option once it has been assigned an exercise notice. To
secure its obligation to deliver the underlying security
when it writes a call option, or to pay for the underlying
security when it writes a put option, the Fund will be
required to deposit in escrow the underlying security or
other assets in accordance with the rules of the Options
Clearing Corporation ("Clearing Corporation") or similar
clearing corporation and the securities exchange on which
the option is written.

An option position may be closed out only where there exists
a secondary market for an option of the same series on a
recognized securities exchange or in the over-the-counter
market. A Fund expects to write options only on national
securities exchanges or in the over-the-counter market.  A
Fund may purchase put options issued by the Clearing
Corporation or in the over-the-counter market.

A Fund may realize a profit or loss upon entering into a
closing transaction. In cases in which the Fund has written
an option, it will realize a profit if the cost of the
closing purchase transaction is less than the premium
received upon writing the original option and will incur a
loss if the cost of the closing purchase transaction exceeds
the premium received upon writing the original option.
Similarly, when the Fund has purchased an option and engages
in a closing sale transaction, whether it recognizes a
profit or loss will depend upon whether the amount received
in the closing sale transaction is more or less than the
premium the Fund initially paid for the original option plus
the related transaction costs.

Although a Fund generally will purchase or write only those
options for which the Manager and/or the Subadviser believes
there is an active secondary market so as to facilitate
closing transactions, there is no assurance that sufficient
trading interest to create a liquid secondary market on a
securities exchange will exist for any particular option or
at any particular time, and for some options no such
secondary market may exist. A liquid secondary market in an
option may cease to exist for a variety of reasons. In the
past, for example, higher than anticipated trading activity
or order flow, or other unforeseen events, have at times
rendered certain of the facilities of the Clearing
Corporation and national securities exchanges inadequate and
resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders
or trading halts or suspensions in one or more options.
There can be no assurance that similar events, or events
that may otherwise interfere with the timely execution of
customers' orders, will not recur. In such event, it might
not be possible to effect closing transactions in particular
options. If, as a covered call option writer, a Fund is
unable to effect a closing purchase transaction in a
secondary market, it will not be able to sell the underlying
security until the option expires or it delivers the
underlying security upon exercise.

Securities exchanges generally have established limitations
governing the maximum number of calls and puts of each class
which may be held or written, or exercised within certain
periods, by an investor or group of investors acting in
concert (regardless of whether the options are written on
the same or different securities exchanges or are held,
written or exercised in one or more accounts or through one
or more brokers).  It is possible that the Funds and other
clients of the Manager and/or the Subadviser and certain of
their affiliates may be considered to be such a group.  A
securities exchange may order the liquidation of positions
found to be in violation of these limits, and it may impose
certain other sanctions.

In the case of options written by a Fund that are deemed
covered by virtue of the Fund's holding convertible or
exchangeable preferred stock or debt securities, the time
required to convert or exchange and obtain physical delivery
of the underlying common stocks with respect to which the
Fund has written options may exceed the time within which
the Fund must make delivery in accordance with an exercise
notice. In these instances, the Fund may purchase or
temporarily borrow the underlying securities for purposes of
physical delivery. By so doing, the Fund will not bear any
market risk because the Fund will have the absolute right to
receive from the issuer of the underlying security an equal
number of shares to replace the borrowed stock, but the Fund
may incur additional transaction costs or interest expenses
in connection with any such purchase or borrowing.

Although the Subadviser will attempt to take appropriate
measures to minimize the risks relating to a Fund's writing
of call options and purchasing of put and call options,
there can be no assurance that the Fund will succeed in its
option-writing program.

Stock Index Options.  As described generally above, each
Fund may purchase put and call options and write call
options on domestic stock indexes listed on domestic
exchanges in order to realize its investment objective of
long-term capital appreciation or for the purpose of hedging
its portfolio. A stock index fluctuates with changes in the
market values of the stocks included in the index. Some
stock index options are based on a broad market index such
as the New York Stock Exchange Composite Index or the
Canadian Market Portfolio Index, or a narrower market index
such as the Standard & Poor's 100. Indexes also are based on
an industry or market segment such as the American Stock
Exchange Oil and Gas Index or the Computer and Business
Equipment Index.

Options on stock indexes are generally similar to options on
stock except that the delivery requirements are different.
Instead of giving the right to take or make delivery of
stock at a specified price, an option on a stock index gives
the holder 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 exercise, multiplied by
(b) a fixed "index multiplier." Receipt of this cash amount
will depend upon the closing level of the stock index upon
which the option is based being greater than, in the case of
a call, or less than, in the case of a put, the exercise
price of the option. The amount of cash received will be
equal to such difference between the closing price of the
index and the exercise price of the option expressed in
dollars or a foreign currency, as the case may be, times a
specified multiple. The writer of the option is obligated,
in return for the premium received, to make delivery of this
amount. The writer may offset its position in stock index
options prior to expiration by entering into a closing
transaction on an exchange or it may let the option expire
unexercised.

The effectiveness of purchasing or writing stock index
options as a hedging technique will depend upon the extent
to which price movements in the portion of the securities
portfolio of the Fund correlate with price movements of the
stock index selected. Because the value of an index option
depends upon movements in the level of the index rather than
the price of a particular stock, whether the Fund will
realize a gain or loss from the purchase or writing of
options on an index depends upon movements in the level of
stock prices in the stock market generally or, in the case
of certain indexes, in an industry or market segment, rather
than movements in the price of a particular stock.
Accordingly, successful use by a Fund of options on stock
indexes will be subject to the Su's ability to predict
correctly movements in the direction of the stock market
generally or of a particular industry. This requires
different skills and techniques than predicting changes in
the price of individual stocks.

Futures Contracts and Options on Futures Contracts.  As
described generally above, each Fund may invest in stock
index futures contracts and options on futures contracts
traded on a domestic exchange or board of trade.  Futures
contracts provide for the future sale by one party and
purchase by another party of a specified amount of a
specific security at a specified future time and at a
specified price.  A Fund may enter into futures contracts
for any of the following purposes: as a substitute for
buying or selling securities; as a cash flow management
technique; to hedge against adverse changes in the market
value of its securities; and to settle transactions in
securities quoted in foreign currencies. A Fund may enter
into futures contracts and options on futures to seek higher
investment returns when a futures contract is priced more
attractively than stocks comprising a benchmark index, to
facilitate trading or to reduce transaction costs.  The Fund
will enter into futures contracts and options only on
futures contracts that are traded on a domestic exchange and
board of trade.  Assets committed to futures contracts will
be segregated on the Fund's books to the extent required by
law.

The purpose of entering into a futures contract by a Fund is
to protect it from fluctuations in the value of securities
without actually buying or selling the securities. For
example, in the case of stock index futures contracts, if
the Fund anticipates an increase in the price of stocks it
intends to purchase at a later time, the Fund could enter
into contracts to purchase the stock index (known as taking
a "long" position) as a temporary substitute for the
purchase of stocks. If an increase in the market occurs that
influences the stock index as anticipated, the value of the
futures contracts increases and thereby serves as a hedge
against the Fund's not participating in a market advance.
The Fund then may close out the futures contracts by
entering into offsetting futures contracts to sell the stock
index (known as taking a "short" position) as it purchases
individual stocks. The Fund can accomplish similar results
by buying securities with long maturities and selling
securities with short maturities. But by using futures
contracts as an investment tool to reduce risk, given the
greater liquidity in the futures market, it may be possible
to accomplish the same result more easily and more quickly.

No consideration will be paid or received by a Fund upon the
purchase or sale of a futures contract. Initially, the Fund
will be required to deposit with the broker an amount of
cash or cash equivalents equal to approximately 1% to 10% of
the contract amount (this amount is subject to change by the
exchange or board of trade on which the contract is traded
and brokers or members of such board of trade may charge a
higher amount). This amount is known as "initial margin" and
is in the nature of a performance bond or good faith deposit
on the contract which is returned to the Fund upon
termination of the futures contract, assuming all
contractual obligations have been satisfied. Subsequent
payments, known as "variation margin," to and from the
broker, will be made daily as the price of the index or
securities underlying the futures contract fluctuates,
making the long and short positions in the futures contract
more or less valuable, a process known as "marking-to-
market." In addition, when the Fund enters into a long
position in a futures contract or an option on a futures
contract, it must deposit into a segregated account with the
Fund's custodian an amount of cash or cash equivalents equal
to the total market value of the underlying futures
contract, less amounts held in the Fund's commodity
brokerage account at its broker. At any time prior to the
expiration of a futures contract, the Fund may elect to
close the position by taking an opposite position, which
will operate to terminate the Fund's existing position in
the contract.
There are several risks in connection with the use of
futures contracts as a hedging device. Successful use of
futures contracts by a Fund is subject to the ability of the
Subadviser to predict correctly movements in the stock
market or in the direction of interest rates. These
predictions involve skills and techniques that may be
different from those involved in the management of
investments in securities. In addition, there can be no
assurance that there will be a favorable correlation between
movements in the price of the securities underlying the
futures contract and movements in the price of the
securities that are the subject of the hedge. A decision of
whether, when and how to hedge involves the exercise of
skill and judgment, and even a well-conceived hedge may be
unsuccessful to some degree because of market behavior or
unexpected trends in market behavior or interest rates.

Positions in futures contracts may be closed out only on the
exchange on which they were entered into (or through a
linked exchange) and no secondary market exists for those
contracts. In addition, although each Fund intends to enter
into futures contracts only if there is an active market for
the contracts, there is no assurance that an active market
will exist for the contracts at any particular time. Most
futures exchanges and boards of trade limit the amount of
fluctuation permitted in futures contract prices during a
single trading day. Once the daily limit has been reached in
a particular contract, no trades may be made that day at a
price beyond that limit. It is possible that futures
contract prices could move to the daily limit for several
consecutive trading days with little or no trading, thereby
preventing prompt liquidation of futures positions and
subjecting some futures traders to substantial losses. In
such event, and in the event of adverse price movements, a
Fund would be required to make daily cash payments of
variation margin; in such circumstances, an increase in the
value of the portion of the portfolio being hedged, if any,
may partially or completely offset losses on the futures
contract. As described above, however, no assurance can be
given that the price of the securities being hedged will
correlate with the price movements in a futures contract and
thus provide an offset to losses on the futures contract.

INVESTMENT RESTRICTIONS

The investment restrictions numbered 1 through 7 below and
each Fund's investment objective have been adopted by the
Company as fundamental policies of the respective Funds.
Under the 1940 Act, a fundamental policy may not be changed
with respect to a Fund without the vote of a majority of the
outstanding voting securities of the Fund.  Majority is
defined in the 1940 Act as the lesser of (a) 67% or more of
the shares present at a Fund meeting, if the holders of more
than 50% of the outstanding shares of the fund are present
or represented by proxy, or (b) more than 50% of outstanding
shares.

Under the investment restrictions adopted by the Company
with respect to each Fund, each Fund will not:
1.	Purchase or sell the securities of any issuer, if, as
a result of such purchase or sale, less than 25% of the
assets of the Fund would be invested in the securities of
issuers principally engaged in the business activities
having the specific characteristics denoted by the Fund.

2.	Borrow money, except that (a) the Fund may borrow from
banks for temporary or emergency (not leveraging) purposes,
including the meeting of redemption requests which might
otherwise require the untimely disposition of securities,
and (b) the Fund may, to the extent consistent with its
investment policies, enter into reverse repurchase
agreements, forward roll transactions and similar investment
strategies and techniques.  To the extent that it engages in
transactions described in (a) and (b), the Fund will be
limited so that no more than 331/3% of the value of its
total assets (including the amount borrowed), valued at the
lesser of cost or market, less liabilities (not including
the amount borrowed) valued at the time the borrowing is
made, is derived from such transactions.

3.	Issue "senior securities" as defined in the 1940 Act
and the rules, regulations and orders thereunder, except as
permitted under the 1940 Act and the rules, regulations and
orders thereunder.

4.	Make loans.  This restriction does not apply to: (a)
the purchase of debt obligations in which the Fund may
invest consistent with its investment objectives and
policies; (b) repurchase agreements; and (c) loans of its
portfolio securities, to the fullest extent permitted under
the 1940 Act.

5.	Purchase or sell real estate, real estate mortgages,
commodities or commodity contracts, but this restriction
shall not prevent the Fund from (a) investing in securities
of issuers engaged in the real estate business or the
business of investing in real estate (including interests in
limited partnerships owning or otherwise engaging in the
real estate business or the business of investing in real
estate) and securities which are secured by real estate or
interests therein;  (b) holding or selling real estate
received in connection with securities it holds or held;
(c)  trading in futures contracts and options on futures
contracts (including options on currencies to the extent
consistent with the Fund's investment objective and
policies);  or (d) investing in real estate investment trust
securities.

6.	Engage in the business of underwriting securities
issued by other persons, except to the extent that the Fund
may technically be deemed to be an underwriter under the
Securities Act of 1933, as amended, in disposing of
portfolio securities.

7.	Purchase or otherwise acquire any illiquid security
except as permitted under the 1940 Act for open-end
investment companies, which currently permits up to 15% of
the Fund's net assets to be invested in illiquid securities.

If any percentage restriction described above is complied
with at the time of an investment, a later increase or
decrease in percentage resulting from a change in values or
assets will not constitute a violation of such restriction.

DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

The Directors and executive officers of the Company,
together with information as to their principal business
occupations during the past five years, are shown below.
Each Director who is an "interested person" of each Fund, as
defined in the 1940 Act, is indicated by an asterisk.

HERBERT BARG (Age 77).  Director
Private Investor.  Director or trustee of 16 investment
companies associated with Citigroup Inc. ("Citigroup").  His
address is 273 Montgomery Avenue, Bala Cynwyd, Pennsylvania,
19004.

*ALFRED J. BIANCHETTI (Age 78).  Director
Retired; formerly Senior Consultant to Dean Witter Reynolds
Inc.  Director or trustee of 11 investment companies
associated with Citigroup.  His address is 19 Circle End
Drive, Ramsey, New Jersey 07466.

MARTIN BRODY (Age 79). Director
Consultant, HMK Associates.  Retired Vice Chairman of the
Board of Restaurant Associates Corp.  Director or trustee of
20 investment companies associated with Citigroup.  His
address is c/o HMK Associates, 30 Columbia Turnpike, Florham
Park, New Jersey 07932.

DWIGHT B. CRANE (Age 63). Director
Professor, Harvard Business School.  Director or trustee of
23 investment companies associated with Citigroup.  His
address is c/o Harvard Business School, Soldiers Field Road,
Boston, Massachusetts 02163.

BURT N. DORSETT (Age 70). Director
Managing Partner of the investment counseling firm Dorsett
McCabe Management, Inc.  Director of Research Corporation
Technologies, Inc., a nonprofit patent clearing and
licensing firm.  Director or trustee of 11 investment
companies associated with Citigroup.  His address is 201
East 62nd Street, New York, New York 10021.

ELLIOT S. JAFFE (Age 74). Director
Chairman of the Board and President of The Dress Barn, Inc.
Director or trustee of 11 investment companies associated
with Citigroup.  His address is 30 Dunnigan Drive, Suffern,
New York 10021.

STEPHEN E. KAUFMAN (Age 69). Director
Attorney.  Director or trustee of 13 investment companies
associated with Citigroup.  His address is 277 Park Avenue,
New York, New York 10172.

JOSEPH J. McCANN (Age 70). Director
Financial Consultant.  Retired Financial Executive, Ryan
Homes, Inc.  Director or trustee of 11 investment companies
associated with Citigroup.  His address is 200 Oak Park
Place, Pittsburgh, Pennsylvania 15243.

*HEATH B. McLENDON (Age 67). Chairman of the Board,
President and Chief Executive Officer. Managing Director of
Salomon Smith Barney Inc. ("Salomon Smith Barney"),
President of SSB Citi and Travelers Investment Adviser, Inc.
("TIA"); Chairman or Co-Chairman of the Board of 77
investment companies associated with Citigroup.  His address
is 7 World Trade Center, New York, New York 10048.
CORNELIUS C. ROSE, JR. (Age 68). Director
President, Cornelius C. Rose Associates, Inc., financial
consultants, and Chairman and Director of Performance
Learning Systems, an educational consultant. Director or
trustee of 11 investment companies associated with
Citigroup.  His address is Meadowbrook Village, Building 4,
Apt. 6, West Lebanon, New Hampshire 03784.

LEWIS E. DAIDONE (Age 43).  Senior Vice President and
Treasurer
Managing Director of Salomon Smith Barney, Chief Financial
Officer of the Smith Barney Mutual funds; Director and
Senior Vice President of SSB Citi and TIA; Senior Vice
President and Treasurer of 683 investment companies
associated with Citigroup.

IRVING DAVID (Age 40). Controller
Director of Salomon Smith Barney; Formerly Assistant
Treasurer of First Investment Management Company; Controller
or Assistant Treasurer of 43 investment companies associated
with Citigroup.

CHRISTINA T. SYDOR (Age 50).  Secretary
Managing Director of Salomon Smith Barney. General Counsel
and Secretary of SSB Citi and TIA; Secretary of 61
investment companies associated with Citigroup.

As of February 21, 2001, the Company's Directors and
officers of each Fund, as a group, owned less than 1% of the
outstanding shares of common stock of the Company.

As of February 21, 2001 to the knowledge of the funds and
the board of trustees, no single shareholder or group (as
the term is used in Section 13(d) of the Securities Act of
1934) beneficially owned or owner of record more than 5% of
the outstanding shares of the fund with the exception of the
following:

FUND
CLASS
SHARES
HELD
PERCENT
NAME
ADDRESS
Global
Biotechnology
Fund
A
93,283.
582
9.28
Sidney Swartz
Judith Swartz
JTWRCS

33 Bradlee Road
Marblehead, MA 01945
Global
Biotechnology
Fund
A
73,485.
185
7.32
SB Corp Trust Cust
New Mexico State
University

403 B-7 A/C Wiley
Thompson
P.O. Box 3793
Las Cruces, NM
88003-0041
Global Media
&
Telecommunica
tions Fund
A
20,470.
829
11.42
Fisery Securities
Inc
FAO  72175985
ATTN: Mutual Funds
Dept.
One Commerce Square
2905 Market Street
Suite 1200
Philadelphia, PA
19103
Global Media
&
Telecommunica
tions Fund
A
13,869.
749
7.74
Richard Cristiani
and
Isabelle Cristiani
JTWRCS
510 Nassau Avenue
Freeport, NY 111

No officer, Director or employee of Salomon Smith Barney or
any of its affiliates receives any compensation from the
Company for serving as an officer or director of the
Company.  The Company pays each Director who is not an
officer, director or employee of Salomon Smith Barney or any
of its affiliates a fee of $6,000 per annum plus $250 per
in-person meeting and $100 per telephonic meeting. All
Directors are reimbursed for travel and out-of-pocket
expenses incurred to attend such meetings.

The following table shows the compensation paid by the
Company and other Smith Barney Mutual Funds to each Director
during the Company's last fiscal year.  None of the officers
of the Company received any compensation from the Company
for such period.  The Company does not pay retirement
benefits to its Directors and officers. Officers and
interested Directors of the Company are compensated by
Salomon Smith Barney.






Name of Person



Aggregate
Compensat
ion
From
Company+

Total
Pension or
Retirement
Benefits
Accrued
As part of
Company
Expenses

Compensation
from Company
and Fund
Complex
Paid to
Directors

Number of
Funds for
Which
Director
Serves
Within
Fund Complex

Herbert Barg**
Alfred
Bianchetti* **
Martin Brody**
Dwight B.
Crane**
Burt N.
Dorsett**
Elliot S.
Jaffe**
Stephen E.
Kaufman**
Joseph J.
McCann**
Heath B.
McLendon*
Cornelius C.
Rose, Jr.**

$3,250.00
$3,000.00
$2,750.00
$3,250.00
$3,250.00
$2,500.00
$3,250.00
$3,250.00
     $
0.00
$3,000.00

$0
 0
 0
 0
 0
 0
 0
 0
 0
 0

$105,425.00
        $
51,200.00
$132,500.00
$139,975.00
        $
51,200.00
        $
47,550.00
        $
96,400.00
        $
51,200.00
        $
0.00
        $
51,200.00

18
13
22
25
13
13
15
13
71
13

*	Designates an "interested" Director.
**	Designates member of Audit Committee.
Upon attainment of age 80, Company Directors are required to
change to emeritus status.  Directors Emeritus are entitled
to serve in emeritus status for a maximum of 10 years,
during which time they are paid 50% of the annual retainer
fee and meeting fees otherwise applicable to Company
Directors, together with reasonable out-of-pocket expenses
for each meeting attended.  Directors Emeritus may attend
meetings but have no voting rights.  During the Company's
last fiscal year, aggregate compensation paid to Directors
Emeritus was $1,500.
+ Reflects compensation paid to Directors when the Company
was previously known as Smith Barney Natural Resources Fund
Inc.

INVESTMENT MANAGEMENT AND OTHER SERVICES

Investment Manager and SubAdviser

SSB Citi serves as investment manager to the Funds pursuant
to a written agreement with the fund (an "Management
Agreement").  SSB Citi is a wholly owned subsidiary of
Salomon Smith Barney Holdings Inc. ("Holdings").  Holdings
is a wholly owned subsidiary of Citigroup, which is located
at 1 Citicorp Center, 153 East 53rd Street, New York, New
York 10028.  SSB Citi was incorporated on March 12, 1968
under the laws of Delaware and converted to a Delaware
limited liability company in September 1999.  The Management
Agreement was approved by the Board of Directors, including
a majority of the Directors who are not "interested persons"
of the Company or the Manager ("Independent Directors"). SSB
Citi (through its predecessor entities) has been in the
investment counseling business since 1968 and renders
investment advice to a wide variety of individual,
institutional and investment company clients that had
aggregate assets under management as of February 12, 2000 in
excess of $144 billion.

CGAM provides discretionary and non-discretionary portfolio
management services to a wide variety of individual and
institutional accounts, including, but not limited to, banks
or thrift institutions, retirement plans, pension and
profit-entities, registered investment companies and
unregistered domestic and offshore funds. The Sub-Advisory
Agreement was approved by the Board of Directors, including
a majority of the Directors who are not "interested persons"
of the Company or the Manager.  As of February 21, 2001, the
Subadviser had $351 billion in assets under management. The
Subadviser is located at 100 First Stamford Place, Stamford,
Connecticut.

The Manager and the Subadviser pay the salaries of all
officers and employees who are employed by both it and the
Company, and maintain office facilities for the Company.  In
addition to those services, the Manager furnishes the
Company with statistical and research data, clerical help
and accounting, data processing, bookkeeping, internal
auditing and legal services and certain other services
required by the Company, prepares reports to the fund's
shareholders and prepares tax returns, reports to and
filings with the Securities and Exchange Commission (the
"SEC") and state Blue Sky authorities.  The Manager and
Subadviser bear all expenses in connection with the
performance of their services.
The Company bears expenses incurred in its operations,
including: taxes, interest, brokerage fees and commissions,
if any; fees of Directors who are not officers, directors,
shareholders or employees of Salomon Smith Barney or one of
its affiliates, SEC fees and state Blue Sky qualification
fees; charges of custodians; transfer and dividend
disbursing agent fees; certain insurance premiums; outside
auditing and legal expenses; costs of maintaining corporate
existence; costs of investor services (including allocated
telephone and personnel expenses); costs of preparing and
printing of prospectuses for regulatory purposes and for
distribution to existing shareholders; costs of
shareholders' reports and shareholder meetings; and meetings
of the officers or Board of Directors of the Company.

As compensation for investment management services, the
respective Fund pays the Manager the annual investment
management fee described below (calculated at the following
annual rate of the Fund's average daily net assets):

Global Biotechnology Fund:				0.95%
Global Media & Telecommunications:		0.80%
Global Technology Fund:				0.95%

For the periods below, the Funds paid investment advisory
fees to SSB Citi as follows:

For the period ended October 31, 2000*, the Funds paid
investment advisory fees to SSB Citi as follows:
Global Biotechnology Fund
$
53,492
Global Media &
Telecommunications

10,434
Global Technology Fund

8,085

 *Global Biotechnology Fund, Global Media &
Telecommunications Fund and Global Technology Fund
waived $43,313, $10,434 and $8,085 for the fiscal
period ended October 31, 2000, respectively.  The
administrative fees have been included in the total
for management fees.

As compensation for investment sub-advisory services, the
Manager pays the Subadviser the fee described below
(calculated at the following annual rate of the Fund's
average daily net assets):

Global Biotechnology Fund:				0.65%
Global Media & Telecommunications:		0.50%
Global Technology Fund:				0.65%

For the period ended October 31, 2000, the Manager paid
investment subadvisory fees to the Subadviser as follows:

Global Biotechnology Fund
$
10,179
Global Media &
Telecommunications

0
Global Technology Fund

0

Custodian and Sub-administration

State Street Bank and Trust Company ("State Street"), whose
principal business address is 225 Franklin Street, Boston,
Massachusetts, 02110, serves as the custodian of each Fund's
assets pursuant to a custodian agreement (the "Custody
Contract") with the Company. State Street is also the
custodian with respect to the custody of foreign securities
held by the Funds. Under the Custody Contract, State Street
(i) holds and transfers portfolio securities on account of
each Fund, (ii) accepts receipts and makes disbursements of
money on behalf of each Fund, (iii) collects and receives
all income and other payments and distributions on account
of each Fund's securities and (iv) makes periodic reports to
the Board of Directors concerning the Funds' operations.
State Street also serves as sub-administrator for each Fund,
pursuant to a written agreement (the "Agreement") with the
Manager and each Fund.

Under the Agreement, State Street has agreed to oversee the
computation of each Fund's net asset value, net income and
realized capital gains, if any; furnish statistical and
research data, clerical services, and stationery and office
supplies; prepare and file various reports with the
appropriate regulatory agencies; and prepare various
materials required by the SEC.

Transfer Agent and Sub-Transfer Agent

Citi Fiduciary Trust Company ("CFTC" or the "transfer
agent") located at 125 Broad St. New York, New York 10004,
serves as each Fund's transfer agent. Under the transfer
agency agreement, CFTC maintains the shareholder account
records for the Fund, handles certain communications between
shareholders and the Fund and distributes dividends and
distributions payable by the Fund. For these services, CFTC
receives a monthly fee computed on the basis of the number
of shareholder accounts it maintains for the Fund during the
month and is reimbursed for out-of-pocket expenses.

PFPC Global Fund Services (formerly known as First Data
Investor Services Group, Inc.) ("sub-transfer agent")
located at Exchange Place, Boston, Massachusetts 02109, a
subsidiary of PNC Bank, serves as each Fund's sub-transfer
agent. Under the sub-transfer agency agreement, the sub-
transfer agent maintains the shareholder account records for
the Fund, handles certain communications between
shareholders and the Fund and distributes dividends and
distributions payable by the Fund. For these services, the
sub-transfer agent receives a monthly fee from CFTC computed
on the basis of the number of shareholder accounts it
maintains for the Fund during the month and is reimbursed
for out-of-pocket expenses.



Auditors

KPMG LLP, independent auditors, 757 Third Avenue, New York,
New York 10017, have been selected to serve as auditors of
the Company and to render opinions on each Fund's financial
statements for the fiscal year ended October 31, 2001.

Counsel

Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New
York 10019, serves as counsel to the Company and each Fund.
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York,
New York, 10038 serves as counsel to the directors who are
not "interested persons" of the Company.

Distributor

Salomon Smith Barney Inc., located at 388 Greenwich Street,
New York, New York 10013 serves as each Fund's distributor
pursuant to a written agreement with the Company dated June
5, 2000 (the "Distribution Agreement") which was approved by
the Company's Board of Directors, including a majority of
the independent directors, on July 12, 2000.

When payment is made by the investor before the settlement
date, unless otherwise noted by the investor, the funds will
be held as a free credit balance in the investor's brokerage
account and Salomon Smith Barney may benefit from the
temporary use of the funds.  The Company's Board of
Directors has been advised of the benefits to Salomon Smith
Barney resulting from these settlement procedures and will
take such benefits into consideration when reviewing the
Investment Management Agreement for continuance.




Fund Name

Financial
Consultant
Compensati
on


Branch
Expenses


Advertis
ing
Expense
s


Printing
Expenses


Interes
t
Expense
s


Other
Expenses
Global
Biotechnology
$880,611
$228,499
$42,096
$1,735
$
5,049
N/A
Global Media &
Telecommunicatio
ns
  322,410

65,508
  11,667
     460

1,832
N/A
Global
Technology
  142,384

41,200

6,924

250

27,876
N/A


Initial Sales Charges
For the 2000 fiscal period, the aggregate dollar amount of
commissions on Class A and Class L shares received by
Salomon Smith Barney were as follows:
	Class A Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$   259,000
Global Media & Telecommunications
Fund

34,000
Global Technology Fund

48,000

Class L Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$   179,000
Global Media & Telecommunications
Fund

25,000
Global Technology Fund

30,000

Deferred Sales Charge (paid to Salomon Smith Barney)

	Class A Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
0
Global Media & Telecommunications
Fund

0
Global Technology Fund

0

	Class B Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
0
Global Media & Telecommunications
Fund

0
Global Technology Fund

0
	Class L Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
0
Global Media & Telecommunications
Fund

0
Global Technology Fund

0

Distribution Arrangements

To compensate Salomon Smith Barney for the services it
provides and for the expense it bears under the Distribution
Agreement, each Fund has adopted a services and distribution
plan (the "Plan") pursuant to Rule l2b-1 under the 1940 Act.
Under the Plan, the Fund pays Salomon Smith Barney a service
fee, accrued daily and paid monthly, calculated at the
annual rate of 0.25% of the value of the Fund's average
daily net assets attributable to the Class A, Class B and
Class L shares. In addition, the Fund pays Salomon Smith
Barney a distribution fee with respect to the Class B and
Class L shares primarily intended to compensate Salomon
Smith Barney for its initial expense of paying its Financial
Consultants and other Service Agents a commission upon sales
of those shares. The Class B and Class L distribution fee is
calculated at the annual rate of 0.75% of the value of the
Fund's average daily net assets attributable to the shares
of the respective Class.

Under its terms, the Plan continues from year to year,
provided such continuance is approved annually by vote of
the Board of Directors, including a majority of the
Directors who are not interested persons of the Fund and who
have no direct or indirect financial interest in the
operation of the Plan or in the Distribution Agreement (the
"Independent Directors").  The Plan may not be amended to
increase the amount of the service and distribution fees
without shareholder approval, and all amendments of the Plan
also must be approved by the Directors including all of the
Independent Directors in the manner described above.  The
Plan may be terminated with respect to a Class at any time,
without penalty, by vote of a majority of the Independent
Directors or, with respect to the Fund, by vote of a
majority of the outstanding voting securities of the Fund
(as defined in the 1940 Act).  Pursuant to the Plan, Salomon
Smith Barney will provide the Board of Directors with
periodic reports of amounts expended under the Plan and the
purpose for which such expenditures were made.

Service Fees and Distribution Fees

	Class A Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
3,349
Global Media & Telecommunications
Fund

426
Global Technology Fund

617

	Class B Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
18,334
Global Media & Telecommunications
Fund

7,901
Global Technology Fund

2,363

	Class L Shares
	For the period ended October 31, 2000:
Global Biotechnology Fund
$
24,578
Global Media & Telecommunications
Fund

3,437
Global Technology Fund

3,680

Code of Ethics.  Pursuant to Rule 17j-1 of the 1940 Act, the
Funds, their investment advisers and principal underwriter
have adopted a code of ethics that permits personnel to
invest in securities for their own accounts, including
securities that may be purchased or held by the Funds. All
personnel must place the interests of clients first and
avoid activities, interests and relationships that might
interfere with the duty to make decisions in the best
interests of the clients. All personal securities
transactions by employees must adhere to the requirements of
the code and must be conducted in such a manner as to avoid
any actual or potential conflict of interest, the appearance
of such a conflict, or the abuse of an employee's position
of trust and responsibility.  A copy of the Funds' code of
ethics is on file with the SEC.

PORTFOLIO TRANSACTIONS

The Subadviser arranges for the purchase and sale of the
Fund's securities and selects brokers and dealers (including
Salomon Smith Barney) which in its best judgment provide
prompt and reliable execution at favorable prices and
reasonable commission rates. The Subadviser may select
brokers and dealers that provide it with research services
and may cause the Fund to pay such brokers and dealers
commissions which exceed those other brokers and dealers may
have charged, if it views the commissions as reasonable in
relation to the value of the brokerage and/or research
services.  In selecting a broker, including Salomon Smith
Barney, for a transaction, the primary consideration is
prompt and effective execution of orders at the most
favorable prices. Subject to that primary consideration,
dealers may be selected for research statistical or other
services to enable the Manager, the Subadviser or its
affiliates to supplement its own research and analysis.

Decisions to buy and sell securities for a Fund are made by
the Subadviser, subject to the overall supervision and
review of the Company's Board of Directors. Portfolio
securities transactions for a Fund are effected by or under
the supervision of the Subadviser.

Transactions on stock exchanges involve the payment of
negotiated brokerage commissions. There is generally no
stated commission in the case of securities traded in the
over-the-counter market, but the price of those securities
includes an undisclosed commission or mark-up. Over-the-
counter purchases and sales are transacted directly with
principal market makers except in those cases in which
better prices and executions may be obtained elsewhere. The
cost of securities purchased from underwriters includes an
underwriting commission or concession, and the prices at
which securities are purchased from and sold to dealers
include a dealer's mark-up or mark-down.

In executing portfolio transactions and selecting brokers or
dealers, it is each Fund's policy to seek the best overall
terms available. The Subadviser, in seeking the most
favorable price and execution, considers all factors it
deems relevant, including, for example, the price, the size
of the transaction, the reputation, experience and financial
stability of the broker-dealer involved and the quality of
service rendered by the broker-dealer in other transactions.
The Subadviser receives research, statistical and quotation
services from several broker-dealers with which it places
the Fund's portfolio transactions. It is possible that
certain of the services received primarily will benefit one
or more other accounts for which the Subadviser exercises
investment discretion. Conversely, the Fund may be the
primary beneficiary of services received as a result of
portfolio transactions effected for other accounts. The
management and subadvisory fee is not reduced by reason of
its receiving such brokerage and research services. The
Company's Board of Directors, in its discretion, may
authorize the Subadviser to cause the Fund to pay a broker
that provides brokerage and research services to the
Subadviser a commission in excess of that which another
qualified broker would have charged for effecting the same
transaction. Salomon Smith Barney will not participate in
commissions from brokerage given by the Fund to other
brokers or dealers and will not receive any reciprocal
brokerage business resulting therefrom.
In accordance with Section 17(e) of the 1940 Act and Rule
17e-1 thereunder, the Company's Board of Directors has
determined that any portfolio transaction for the Fund may
be executed through Salomon Smith Barney or an affiliate of
Salomon Smith Barney if, in the Subadviser's judgment, the
use of Salomon Smith Barney or an affiliate is likely to
result in price and execution at least as favorable as those
of other qualified brokers and if, in the transaction,
Salomon Smith Barney or the affiliate charges the Fund a
commission rate consistent with those charged by Salomon
Smith Barney or an affiliate to comparable unaffiliated
customers in similar transactions. In addition, under SEC
rules, Salomon Smith Barney may directly execute such
transactions for the Fund on the floor of any national
securities exchange, provided: (a) the Board of Directors
has expressly authorized Salomon Smith Barney to effect such
transactions; and (b) Salomon Smith Barney annually advises
the Fund of the aggregate compensation it earned on such
transactions.

Even though investment decisions for a Fund are made
independently from those of the other accounts managed by
the Subadviser, investments of the kind made by the Fund
also may be made by those other accounts. When the Fund and
one or more accounts managed by the Subadviser are prepared
to invest in, or desire to dispose of, the same security,
available investments or opportunities for sales will be
allocated in a manner believed by the Subadviser to be
equitable. In some cases, this procedure may adversely
affect the price paid or received by a Fund or the size of
the position obtained for or disposed of by a Fund.

A Fund will not purchase securities during the existence of
any underwriting or selling group relating to the
securities, of which the Manager or any affiliate is a
member, except to the extent permitted by the SEC.  Under
certain circumstances, the Fund may be at a disadvantage
because of this limitation in comparison with other Funds
that have similar investment objectives but that are not
subject to a similar limitation.









Portfolio







Total
Brokerage
Commissions





Commissions
paid to
Salomon
Smith
Barney and
Affiliates



% of Total
Brokerage
Commissions
paid to
Salomon
Smith
Barney and
Affiliates

% of Total
Dollar
Amount of
Transaction
s Involving
Commissions
Paid to
Salomon
Smith
Barney and
Affiliates

Global Biotechnology
Fund
$47,019
$ 0
0%
0 %
Global Technology
Fund
$  7,572
$ 0
0%
0 %
Global Media &
Telecommunications
Fund
$10,910
$ 0
0%
0 %


PORTFOLIO TURNOVER

Each Fund's portfolio turnover rate (the lesser of purchases
or sales of portfolio securities during the year, excluding
purchases or sales of short-term securities, divided by the
monthly average value of portfolio securities) is generally
not expected to exceed 100%. The rate of turnover will not
be a limiting factor, however, when a Fund deems it
desirable to sell or purchase securities.
The Subadviser may cause a Fund to sell or purchase
securities to ensure compliance with the Fund's investment
policies.  For the fiscal period ended October 31, 2000, the
portfolio turnover rates were as follows:

Global Biotechnology Fund
1%
Global Media & Telecommunications Fund
3%
Global Technology Fund
5%



PURCHASE OF SHARES

Sales Charge Alternatives

The following classes of shares are available for purchase.
See the prospectus for a discussion of factors to consider
in selecting which Class of shares to purchase.

Class A Shares.  Class A shares of each Fund are sold to
investors at the public offering price, which is the net
asset value plus an initial sales charge as follows:

Sales Charge




Amount of
Investment

% of Offering
Price

% of Amount
Invested
Dealers'
Reallowance as %
of Offering Price
Less than $25,000
5.00%
5.26%
4.50%
$  25,000 -
49,999
4.25
4.44
3.83
    50,000 -
99,999
3.75
3.90
3.38
    100,000 -
249,999
3.25
3.36
2.93
    250,000 -
499,999
2.75
2.83
2.48
    500,000 -
999,000
2.00
2.04
1.80
  1,000,000 or
more
0
0
Up to 1.00*
*	A distributor pays up to 1.00% to a Service Agent.

Purchases of Class A shares of $1,000,000 or more will be
made at net asset value without any initial sales charge,
but will be subject to a deferred sales charge of 1.00% on
redemptions made within 12 months of purchase.  The deferred
sales charge on Class A shares is payable to Salomon Smith
Barney, which compensates Salomon Smith Barney Financial
Consultants and other dealers whose clients make purchases
of $1,000,000 or more.  The deferred sales charge is waived
in the same circumstances in which the deferred sales charge
applicable to Class B and Class L shares is waived.  See
"Deferred Sales Charge Alternatives" and "Waivers of
Deferred Sales Charge."

Members of the selling group may receive up to 90% of the
sales charge and may be deemed to be underwriters of the
Fund as defined in the 1933 Act.  The reduced sales charges
shown above apply to the aggregate of purchases of Class A
shares of the Fund made at one time by "any person," which
includes an individual and his or her immediate family, or a
trustee or other fiduciary of a single trust estate or
single fiduciary account.

Class B Shares.  Class B shares are sold without an initial
sales charge but are subject to a deferred sales charge
payable upon certain redemptions.  See "Deferred Sales
Charge Provisions" below.

Class L Shares.  Class L shares are sold with an initial
sales charge of 1.00% (which is equal to 1.01% of the amount
invested) and are subject to a deferred sales charge payable
upon certain redemptions.  See "Deferred Sales Charge
Provisions" below.  Until June 22, 2001, purchases of Class
L shares by investors who were holders of Class C shares of
other Smith Barney Mutual Funds on June 12, 1998 will not be
subject to the 1.00% initial sales charge.

Class Y Shares.  Class Y shares are sold without an initial
sales charge or deferred sales charge and are available only
to investors investing a minimum of $15,000,000 (except
purchases of Class Y shares by Smith Barney Allocation
Series Inc., for which there is no minimum purchase amount).

General

The Funds' shares are continuously offered to new investors.
See "Purchase of Shares."  Investors may purchase shares
from a Service Agent. In addition, certain investors,
including qualified retirement plans purchasing through
certain Service Agents, may purchase shares directly from
the Fund.  When purchasing shares of the Fund, investors
must specify whether the purchase is for Class A, Class B,
Class L or Class Y shares.  Service Agents may charge their
customers an annual account maintenance fee in connection
with a brokerage account through which an investor purchases
or holds shares.  Accounts held directly at the transfer
agent are not subject to a maintenance fee.

Investors in Class A, Class B and Class L shares may open an
account in the Fund by making an initial investment of at
least $1,000 for each account, or $250 for an IRA or a Self-
Employed Retirement Plan, in the Fund. Investors in Class Y
shares may open an account by making an initial investment
of $15,000,000. Subsequent investments of at least $50 may
be made for all Classes. For participants in retirement
plans qualified under Section 403(b)(7) or Section 401(c) of
the Code, the minimum initial investment required for Class
A, Class B and Class L shares and the subsequent investment
requirement for all Classes in the Fund is $25.  There are
no minimum investment requirements for Class A shares for
employees of Citigroup and its subsidiaries, including
Salomon Smith Barney, unitholders who invest distributions
from a Unit Investment Trust ("UIT") sponsored by Salomon
Smith Barney, and Directors/Trustees of any of the Smith
Barney Mutual Funds, and their spouses and children. The
Fund reserves the right to waive or change minimums, to
decline any order to purchase its shares and to suspend the
offering of shares from time to time. Shares purchased will
be held in the shareholder's account by the sub-transfer
agent. Share certificates are issued only upon a
shareholder's written request to the sub-transfer agent.

Purchase orders received by the Fund prior to the close of
regular trading on The New York Stock Exchange, Inc.
("NYSE"), on any day the Fund calculates its net asset
value, are priced according to the net asset value
determined on that day (the ''trade date'').  Orders
received by a Service Agent prior to the close of regular
trading on the NYSE on any day the Fund calculates its net
asset value, are priced according to the net asset value
determined on that day, provided the order is received by
the Fund or the Fund's sub-transfer agent prior to its close
of business. For shares purchased through Service Agent
payment for shares of the Fund is due on the third business
day after the trade date. In all other cases, payment must
be made with the purchase order.



Sales Charge Waivers and Reductions

Initial Sales Charge Waivers.  Purchases of Class A shares
may be made at net asset value without a sales charge in the
following circumstances: (a) sales to (i) Board Members and
employees of Citigroup and its subsidiaries and any
Citigroup affiliated funds including the Smith Barney Mutual
Funds (including retired Board Members and employees); the
immediate families of such persons (including the surviving
spouse of a deceased Board Member or employee); and to a
pension, profit-sharing or other benefit plan for such
persons and (ii) employees of members of the National
Association of Securities Dealers, Inc., provided such sales
are made upon the assurance of the purchaser that the
purchase is made for investment purposes and that the
securities will not be resold except through redemption or
repurchase; (b) offers of Class A shares to any other
investment company to effect the combination of such company
with the Fund by merger, acquisition of assets or otherwise;
(c) purchases of Class A shares by any client of a newly
employed Salomon Smith Barney Financial Consultant (for a
period up to 90 days from the commencement of the Financial
Consultant's employment with Salomon Smith Barney), on the
condition the purchase of Class A shares is made with the
proceeds of the redemption of shares of a mutual fund which
(i) was sponsored by the Financial Consultant's prior
employer, (ii) was sold to the client by the Financial
Consultant and (iii) was subject to a sales charge; (d)
purchases by shareholders who have redeemed Class A shares
in a Fund (or Class A shares of another Smith Barney Mutual
Fund that is offered with a sales charge) and who wish to
reinvest their redemption proceeds in the Fund, provided the
reinvestment is made within 60 calendar days of the
redemption; (e) purchases by accounts managed by registered
investment advisory subsidiaries of Citigroup; (f) direct
rollovers by plan participants of distributions from a
401(k) plan offered to employees of Citigroup or its
subsidiaries (Note: subsequent investments will be subject
to the applicable sales charge); (g) purchases by a separate
account used to fund certain unregistered variable annuity
contracts; (h) investments of distributions from a UIT
sponsored by Salomon Smith Barney; (i) purchases by
investors participating in a Salomon Smith Barney fee-based
arrangement;  and (j)  purchases of Class A shares by
Section 403(b) or Section 401(a) or (k) accounts associated
with CitiStreet Retirement Programs. In order to obtain such
discounts, the purchaser must provide sufficient information
at the time of purchase to permit verification that the
purchase would qualify for the elimination of the sales
charge.

Right of Accumulation.  Class A shares of the Fund may be
purchased by "any person" (as defined above) at a reduced
sales charge or at net asset value determined by aggregating
the dollar amount of the new purchase and the total net
asset value of all Class A shares of the Fund and of other
Smith Barney Mutual Funds that are offered with a sales
charge as currently listed under "Exchange Privilege" then
held by such person and applying the sales charge applicable
to such aggregate.  In order to obtain such discount, the
purchaser must provide sufficient information at the time of
purchase to permit verification that the purchase qualifies
for the reduced sales charge.  The right of accumulation is
subject to modification or discontinuance at any time with
respect to all shares purchased thereafter.

Letter of Intent - Class A Shares.  A Letter of Intent for
an amount of $50,000 or more provides an opportunity for an
investor to obtain a reduced sales charge by aggregating
investments over a 13 month period, provided the investor
refers to such Letter when placing orders.  For purposes of
a Letter of Intent, the ''Amount of Investment'' as referred
to in the preceding sales charge table includes (i) all
Class A shares of the Fund and other Smith Barney Mutual
Funds offered with a sales charge acquired during the term
of the letter plus (ii) the value of all Class A shares
previously purchased and still owned.  Each investment made
during the period receives the reduced sales charge
applicable to the total amount of the investment goal.  If
the goal is not achieved within the period, the investor
must pay the difference between the sales charges applicable
to the purchases made and the charges previously paid, or an
appropriate number of escrowed shares will be redeemed.  The
term of the Letter will commence upon the date the Letter is
signed, or at the options of the investor, up to 90 days
before such date.  Please contact a Service Agent or the
sub-transfer agent to obtain a Letter of Intent application.

Letter of Intent - Class Y Shares.  A Letter of Intent may
also be used as a way for investors to meet the minimum
investment requirement for Class Y shares (except purchases
of Class Y shares by Smith Barney Allocation Series Inc.,
for which there is no minimum purchase amount).  Such
investors must make an initial minimum purchase of
$5,000,000 in Class Y shares of the Fund and agree to
purchase a total of $15,000,000 of Class Y shares of the
Fund within 13 months from the date of the Letter. If a
total investment of $15,000,000 is not made within the 13-
month period, all Class Y shares purchased to date will be
transferred to Class A shares, where they will be subject to
all fees (including a service fee of 0.25%) and expenses
applicable to the Fund's Class A shares, which may include a
deferred sales charge of 1.00%. Please contact a Service
Agent or the sub-transfer agent for further information.

Deferred Sales Charge Provisions

"Deferred sales charge" shares are: (a) Class B shares; (b)
Class L shares; and (c) Class A shares that were purchased
without an initial sales charge but are subject to a
deferred sales charge.  A deferred sales charge may be
imposed on certain redemptions of these shares.

Any applicable deferred sales charge will be assessed on an
amount equal to the lesser of the original cost of the
shares being redeemed or their net asset value at the time
of redemption. Deferred sales charge shares that are
redeemed will not be subject to a deferred sales charge to
the extent the value of such shares represents: (a) capital
appreciation of Fund assets; (b) reinvestment of dividends
or capital gain distributions; (c) with respect to Class B
shares, shares redeemed more than five years after their
purchase; or (d) with respect to Class L shares and Class A
shares that are deferred sales charge shares, shares
redeemed more than 12 months after their purchase.
Class L shares and Class A shares that are deferred sales
charge shares are subject to a 1.00% deferred sales charge
if redeemed within 12 months of purchase. In circumstances
in which the deferred sales charge is imposed on Class B
shares, the amount of the charge will depend on the number
of years since the shareholder made the purchase payment
from which the amount is being redeemed.  Solely for
purposes of determining the number of years since a purchase
payment, all purchase payments made during a month will be
aggregated and deemed to have been made on the last day of
the preceding Salomon Smith Barney statement month. The
following table sets forth the rates of the charge for
redemptions of Class B share by shareholders.

Year Since Purchase Payment Was
Made

Deferred Sales Charge

First

5.00%

Second

4.00

Third

3.00

Fourth

2.00

Fifth

1.00

Sixth and thereafter

0.00

Class B shares will convert automatically to Class A shares
eight years after the date on which they were purchased and
thereafter will no longer be subject to any distribution
fees. There will also be converted at that time such
proportion of Class B Dividend Shares owned by the
shareholder as the total number of his or her Class B shares
converting at the time bears to the total number of
outstanding Class B shares (other than Class B Dividend
Shares) owned by the shareholder.

In determining the applicabilty of any deferred sales
charge, it will be assumed that a redemption is made first
of shares representing capital appreciation, next of shares
representing the reinvestment of dividends and capital gain
distributions and finally of other shares held by the
shareholder for the longest period of time. The length of
time that deferred sales charge shares acquired through an
exchange have been held will be calculated from the date
that the shares exchanged were initially acquired in one of
the other Smith Barney Mutual Funds, and Fund shares being
redeemed will be considered to represent, as applicable,
capital appreciation or dividend and capital gain
distribution reinvestments in such other funds.  For Federal
income tax purposes, the amount of the deferred sales charge
will reduce the gain or increase the loss, as the case may
be, on the amount realized on redemption.  The amount of any
deferred sales charge will be paid to Salomon Smith Barney.
To provide an example, assume an investor purchased 100
Class B shares of the Fund at $10 per share for a cost of
$1,000.  Subsequently, the investor acquired 5 additional
shares of the Fund through dividend reinvestment.  During
the fifteenth month after the purchase, the investor decided
to redeem $500 of his or her investment.  Assuming at the
time of the redemption the net asset value had appreciated
to $12 per share, the value of the investor's shares would
be $1,260 (105 shares at $12 per share). The deferred sales
charge would not be applied to the amount which represents
appreciation ($200) and the value of the reinvested dividend
shares ($60).  Therefore, $240 of the $500 redemption
proceeds ($500 minus $260) would be charged at a rate of
4.00% (the applicable rate for Class B shares) for a total
deferred sales charge of $9.60.

Waivers of Deferred Sales Charge

The deferred sales charge will be waived on: (a) exchanges
(see "Exchange Privilege"); (b) redemptions of shares within
12 months following the death or disability of the
shareholder; (c) redemptions of shares made in connection
with qualified distributions from retirement plans or IRAs
upon the attainment of age 591/2; (d) involuntary redemptions;
and (e) redemptions of shares to effect a combination of the
Fund with any investment company by merger, acquisition of
assets or otherwise. In addition, a shareholder who has
redeemed shares from other Smith Barney Mutual Funds may,
under certain circumstances, reinvest all or part of the
redemption proceeds within 60 days and receive pro rata
credit for any deferred sales charge imposed on the prior
redemption.

Deferred sales charge waivers will be granted subject to
confirmation (by Salomon Smith Barney in the case of
shareholders who are also Salomon Smith Barney clients or by
the sub-transfer agent in the case of all other
shareholders) of the shareholder's status or holdings, as
the case may be.

Smith Barney Retirement Programs

You may be eligible to participate in a retirement program
sponsored by Salomon Smith Barney or one of its affiliates.
Each Fund offers Class A and Class L shares at net asset
value to participating plans under the programs. You can
meet minimum investment and exchange amounts, if any by
combining the plan's investments in any of the Smith Barney
mutual funds.

There are no sales charges when you buy or sell shares and
the class of shares you may purchase depends on the amount
of your initial investment and/or the date your account is
opened.  Once a class of shares is chosen, all additional
purchases must by of the same class.

For plans opened on or after March 1, 2000 that are not part
of the Paychex offering, Class A shares may be purchased
regardless of the amount invested.

For plans opened prior to March 1, 2000 and for plans that
are part of the Paychex offering, the class of shares you
may purchase depends on the amount of your initial
investment:

Class A Shares.  Class A shares may be purchased by plans
investing at least $1 million.

Class L Shares.  Class L shares may be purchased by plans
investing less than $1 million.  Class L shares are eligible
to exchange into Class A shares not later than 8 years after
the plan joined the program.  They are eligible for exchange
in the following circumstances:

If the plan was opened on or after June 21, 1996 and a total
of $1 million is invested in Smith Barney Funds Class L
shares (other than money market funds), all Class L shares
are eligible for exchange after the plan is in the program
for 5 years.

If the plan was opened before June 21, 1996 and a total of
$500,000 is invested in Smith Barney Funds Class L shares
(other than money market funds) on December 31 in any year,
all Class L shares are eligible for exchange on or about
March 31 of the following year.

For more information, call your Salomon Smith Barney
Financial Consultant or the transfer agent.

Retirement Programs Opened On or After June 21, 1996.  If,
at the end of the fifth year after the date the
participating plan enrolled in the Smith Barney 401(k)
Program or the ExecChoiceTM Program, a participating plan's
total Class L holdings in all non-money market Smith Barney
mutual funds equal at least $1,000,000, the participating
plan will be offered the opportunity to exchange all of its
Class L shares for Class A shares of the Fund. (For
participating plans that were originally established through
a Salomon Smith Barney retail brokerage account, the five-
year period will be calculated from the date the retail
brokerage account was opened.) Such participating plans will
be notified of the pending exchange in writing within 30
days after the fifth anniversary of the enrollment date and,
unless the exchange offer has been rejected in writing, the
exchange will occur on or about the 90th day after the fifth
anniversary date. If the participating plan does not qualify
for the five-year exchange to Class A shares, a review of
the participating plan's holdings will be performed each
quarter until either the participating plan qualifies or the
end of the eighth year.

Retirement Programs Opened Prior to June 21, 1996.  In any
year after the date a participating plan enrolled in the
Smith Barney 401(k) Program, if a participating plan's total
Class L holdings in all non-money market Smith Barney mutual
funds equal at least $500,000 as of the calendar year-end,
the participating plan will be offered the opportunity to
exchange all of its Class L shares for Class A shares of the
Fund. Such Plans will be notified in writing within 30 days
after the last business day of the calendar year and, unless
the exchange offer has been rejected in writing, the
exchange will occur on or about the last business day of the
following March.

Any participating plan in the Smith Barney 401(k) or the
ExecChoiceTM Program, whether opened before or after June
21, 1996, that has not previously qualified for an exchange
into Class A shares will be offered the opportunity to
exchange all of its Class L shares for Class A shares of the
Fund, regardless of asset size, at the end of the eighth
year after the date the participating plan enrolled in the
Smith Barney 401(k) Program or ExecChoiceTM Program.  Such
plans will be notified of the pending exchange in writing
approximately 60 days before the eighth anniversary of the
enrollment date and, unless the exchange has been rejected
in writing, the exchange will occur on or about the eighth
anniversary date. Once an exchange has occurred, a
participating plan will not be eligible to acquire
additional Class L shares, but instead may acquire Class A
shares of the same Fund. Any Class L shares not converted
will continue to be subject to the distribution fee.

Participating plans wishing to acquire shares of a Fund
through the Smith Barney 401(k) Program or the Smith Barney
ExecChoiceTM Program must purchase such shares directly from
the transfer agent. For further information regarding these
Programs, investors should contact a Salomon Smith Barney
Financial Consultant.

Retirement Programs Investing in Class B Shares:  Class B
shares of a Fund are not available for purchase by
participating plans opened on or after June 21, 1996, but
may continue to be purchased by any participating plan in
the Smith Barney 401 (k) Program opened prior to such date
and originally investing in such Class.  Class B shares
acquired are subject to a deferred sales charge of 3.00% of
redemption proceeds if the participating plan terminates
within eight years of the date the participating plan first
enrolled in the Smith Barney 401 (k) Program.
At the end of the eighth year after the date the
participating plan enrolled in the Smith Barney 401 (k)
Program, the participating plan will be offered the
opportunity to exchange all of its Class B shares for Class
A shares of the same Fund.  Such participating plan will be
notified of the pending exchange in writing approximately 60
days before the eighth anniversary of the enrollment date
and, unless the exchange has been rejected in writing, the
exchange will occur on or about the eighth anniversary date.
Once the exchange has occurred, a participating plan will
not be eligible to acquire additional Class B shares, but
instead may acquire Class A shares of the same Fund.  If the
participating elects not to exchange all of its Class B
shares at that time, each Class B share held by the
participating plan will have the same conversion feature as
Class B shares held by other investors.  See "Purchase of
Shares-Deferred Sales Charge Alternatives."

No deferred sales charge is imposed on redemptions of Class
B shares to the extent the net asset value of the shares
redeemed does not exceed the current net asset value of the
shares purchased through reinvestment of dividends or
capital gain distributions, plus the current net asset vlaue
of Class B shares purchased more than eight years prior to
the redemption, plus increases in the net asset value of the
shareholder's Class B shares above the purchase payments
made during the preceding eight years.  Whether or not the
deferred sales charge applies to the redemption by a
participating plan depends on the number of years since the
participating plan first became enrolled in the Smith Barney
401(k) Program, unlike the applicability of the deferred
sales charge to redemptions by other shareholders, which
depends on the number of years since those shareholders made
the purchase payment from which the amount is being
redeemed.

The deferred sales charge will be waived on redemptions of
Class B shares in connection with lump-sum or other
distributions made by a participating plan; as a result of
(a) the retirement of an employee in the participating plan;
(b) the termination of employment of an employee in the
participating plan; (c) the death or disability or an
employee in the participating plan; (d) the attainment of
age 59 1/2 by an employee in the participating plan; (e)
hardship of an employee in the participating plan to the
extent permitted under Section 401(k) of the Code; or (f)
redemptions of shares in connection with a loan made by the
participating plan to an employee.

Determination of Public Offering Price

Each Fund offers its shares to current shareholders of the
Fund on a continuous basis. The public offering price for a
Class A, Class B and Class Y share of the Fund is equal to
the net asset value per share at the time of purchase, plus
for Class A shares an initial sales charge based on the
aggregate amount of the investment.  The public offering
price for Class A share purchases, including applicable
rights of accumulation, equaling or exceeding $500,000 is
equal to the net asset value per share at the time of
purchase and no sales charge is imposed at the time of
purchase.  The public offering price for a Class L share
includes a 1.00% initial sales charge.  A deferred sales
charge is imposed on certain redemptions of Class B shares,
and on Class L shares and Class A shares (purchased in
amounts exceeding $500,000) redeemed within one year of
purchase.

REDEMPTION OF SHARES

The right of redemption of shares of a Fund may be suspended
or the date of payment postponed (a) for any periods during
which the NYSE is closed (other than for customary weekend
and holiday closings), (b) when trading in the markets the
Fund normally utilizes is restricted, or an emergency
exists, as determined by the SEC, so that disposal of the
Fund's investments or determination of its net asset value
is not reasonably practicable or (c) for any other periods
as the SEC by order may permit for the protection of the
Fund's shareholders.

If the shares to be redeemed were issued in certificate
form, the certificates must be endorsed for transfer (or be
accompanied by an endorsed stock power) and must be
submitted to the sub-transfer agent together with the
redemption request. Any signature appearing on a share
certificate, stock power or written redemption request in
excess of $10,000 must be guaranteed by an eligible
guarantor institution such as a domestic bank, savings and
loan institution, domestic credit union, member bank of the
Federal Reserve System or member firm of a national
securities exchange.  Written redemption requests of $10,000
or less do not require a signature guarantee unless more
than one such redemption request is made in any 10-day
period or the redemption proceeds are to be sent to an
address other than the address of record.  Unless otherwise
directed, redemption proceeds will be mailed to an
investor's address of record.  The sub-transfer agent may
require additional supporting documents for redemptions made
by corporations, executors, administrators, trustees or
guardians.  A redemption request will not be deemed properly
received until the sub-transfer agent receives all required
documents in proper form.

If a shareholder holds shares in more than one Class, any
request for redemption must specify the Class being
redeemed.  In the event of a failure to specify which Class,
or if the investor owns fewer shares of the Class than
specified, the redemption request will be delayed until the
transfer agent receives further instructions from Salomon
Smith Barney, or if the shareholder's account is not with
Salomon Smith Barney, from the shareholder directly.  The
redemption proceeds will be remitted on or before the third
business day following receipt of proper tender, except on
any days on which the NYSE is closed or as permitted under
the 1940 Act, in extraordinary circumstances.  Generally, if
the redemption proceeds are remitted to a Salomon Smith
Barney brokerage account, these funds will not be invested
for the shareholder's benefit without specific instruction
and Salomon Smith Barney will benefit from the use of
temporarily uninvested funds.  Redemption proceeds for
shares purchased by check, other than a certified or
official bank check, will be remitted upon clearance of the
check, which may take up to fifteen days.



Distributions in Kind

If the Board of Directors of the Company determines that it
would be detrimental to the best interests of the remaining
shareholders to make a redemption payment wholly in cash, a
Fund may pay, in accordance with SEC rules, any portion of a
redemption in excess of the lesser of $250,000 or 1.00% of
the Fund's net assets by a distribution in kind of portfolio
securities in lieu of cash. Securities issued as a
distribution in kind may incur brokerage commissions when
shareholders subsequently sell those securities.

Additional Information Regarding Telephone Redemption And
Exchange Program

Neither the Fund nor its agents will be liable for following
instructions communicated by telephone that are reasonably
believed to be genuine.  The Fund and its agents will employ
procedures designed to verify the identity of the caller and
legitimacy of instructions (for example, a shareholder's
name and account number will be required and phone calls may
be recorded). The Fund reserves the right to suspend, modify
or discontinue the telephone redemption and exchange program
or to impose a charge for this service at any time following
at least seven (7) days' prior notice to shareholders.

VALUATION OF SHARES

The net asset value per share of the Fund's Classes is
calculated on each day, Monday through Friday, except days
on which the NYSE is closed. The NYSE currently is scheduled
to be closed on New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving and Christmas, and on the
preceding Friday or subsequent Monday when one of these
holidays falls on a Saturday or Sunday, respectively.
Because of the differences in distribution fees and
Class-specific expenses, the per share net asset value of
each Class may differ. The following is a description of the
procedures used by the Fund in valuing its assets.

Securities listed on a national securities exchange will be
valued on the basis of the last sale on the date on which
the valuation is made or, in the absence of sales, at the
mean between the closing bid and asked prices.
Over-the-counter securities will be valued at the mean
between the closing bid and asked prices on each day, or, if
market quotations for those securities are not readily
available, at fair value, as determined in good faith by the
Company's Board of Directors. Short-term obligations with
maturities of 60 days or less are valued at amortized cost,
which constitutes fair value as determined by the Company's
Board of Directors. Amortized cost involves valuing an
instrument at its original cost to the Fund and thereafter
assuming a constant amortization to maturity of any discount
or premium, regardless of the effect of fluctuating interest
rates on the market value of the instrument. All other
securities and other assets of the Fund will be valued at
fair value as determined in good faith by the Company's
Board of Directors.  The value of any security denominated
in a currency other than U.S. dollars will be converted into
U.S. dollars at the prevailing market rate as determined by
the Subadviser.

Foreign securities trading may not take place on all days on
which the NYSE is open. Further, trading takes place in
various foreign markets on days on which the NYSE is not
open. Accordingly, the determination of the net asset value
of a Fund may not take place contemporaneously with the
determination of the prices of investments held by such
Fund. Events affecting the values of investments that occur
between the time their prices are determined and 4:00 P.M.
on each day that the NYSE is open will not be reflected in
the Fund's net asset value unless the Manager, under the
supervision of the Company's Board of Directors, determines
that the particular event would materially affect net asset
value. As a result, a Fund's net asset value may be
significantly affected by such trading on days when a
shareholder has no access to that Fund.

EXCHANGE PRIVILEGE

Except as noted below and in the Prospectus, shareholders of
any of the Smith Barney Mutual Funds may exchange all or
part of their shares for shares of the same class of other
Smith Barney Mutual Funds, to the extent such shares are
offered for sale in the shareholder's state of residence, on
the basis of relative net asset value per share at the time
of exchange as follows:

A. Class A and Class Y shares of the Fund may be
exchanged without a sales charge for the respective
shares of any of the Smith Barney Mutual Funds.

B. Class B shares of any Fund may be exchanged without
a sales charge. Class B shares of the Fund exchanged
for Class B shares of another Smith Barney Mutual Fund
will be subject to the higher applicable deferred
sales charge of the two funds and, for purposes of
calculating deferred sales charge rates and conversion
periods, will be deemed to have been held since the
date the shares being exchanged were deemed to be
purchased.

C. Class L shares of any Fund may be exchanged without
a sales charge. For purposes of deferred sales charge
applicability, Class L shares of the Fund exchanged
for Class L shares of another Smith Barney Mutual Fund
will be deemed to have been owned since the date the
shares being exchanged were deemed to be purchased.

The exchange privilege enables shareholders to acquire
shares of the same Class in a Fund with different investment
objectives when they believe that a shift between funds is
an appropriate investment decision. This privilege is
available to shareholders residing in any state in which
fund shares being acquired may legally be sold. Prior to any
exchange, the shareholder should obtain and review a copy of
the current prospectus of each fund into which an exchange
is being considered. Prospectuses may be obtained from a
Service Agent.

Upon receipt of proper instructions and all necessary
supporting documents, shares submitted for exchange are
redeemed at the then-current net asset value and the
proceeds are immediately invested, at a price as described
above, in shares of the fund being acquired. Salomon Smith
Barney reserves the right to reject any exchange request.
The exchange privilege may be modified or terminated at any
time after written notice to shareholders.


Additional Information Regarding Exchanges. Each Fund is not
designed to provide investors with a means of speculation on
short-term market movements.  A pattern of frequent
exchanges by investors can be disruptive to efficient
portfolio management and, consequently, can be detrimental
to the Fund and its shareholders.  Accordingly, if each
Fund's management in its sole discretion determines that an
investor is engaged in excessive trading, a Fund, with or
without prior notice, may temporarily or permanently
terminate the availability to that investor of Fund
exchanges, or reject in whole or part any purchase or
exchange request with respect to such investor's account.
Such investors also may be barred from purchases and
exchanges involving other funds in the Smith Barney Mutual
Fund family. Accounts under common ownership or control will
be considered as one account for purposes of determining a
pattern of excessive trading. Each Fund may notify an
investor of rejection of a purchase or exchange order after
the day the order is placed.  If an exchange request is
rejected, the Fund will take no other action with respect to
the shares until it receives further instructions from the
investor.  Each Fund's policy on excessive trading applies
to investors who invest in the Fund directly or through
Service Agents, but does not apply to any systematic
investment plans described in the prospectus.

During times of drastic economic or market conditions, each
Fund may suspend the Exchange Privilege temporarily without
notice and treat exchange requests based on their separate
components - redemption orders with a simultaneous request
to purchase the other fund's shares.  In such a case, the
redemption request would be processed at a Fund's next
determined net asset value but the purchase order would be
effective only at the net asset value next determined after
the fund being purchased formally accepts the order, which
may result in the purchase being delayed.

PERFORMANCE INFORMATION

From time to time, the Company may advertise a Fund's total
return and average annual total return in advertisements
and/or other types of sales literature.  These figures are
computed separately for Class A, Class B, Class L and
Class Y shares of the Fund.  These figures are based on
historical earnings and are not intended to indicate future
performance.  Total return is computed for a specified
period of time assuming deduction of the maximum sales
charge, if any, from the initial amount invested and
reinvestment of all income dividends and capital gain
distributions on the reinvestment dates at prices calculated
as stated in the prospectus, then dividing the value of the
investment at the end of the period so calculated by the
initial amount invested and subtracting 100%.  The standard
average annual total return, as prescribed by the SEC is
derived from this total return, which provides the ending
redeemable value.  Such standard total return information
may also be accompanied with nonstandard total return
information for differing periods computed in the same
manner but without annualizing the total return or taking
sales charges into account. The Company may also include
comparative performance information in advertising or
marketing the Fund's shares. Such performance information
may include data from Lipper Analytical Services, Inc. and
other financial publications.

From time to time, the Company may quote a Fund's yield or
total return in advertisements or in reports and other
communications to shareholders. The Company may include
comparative performance information in advertising or
marketing a Fund's shares. Such performance information may
include the following industry and financial publications:
Barron's, Business Week, CDA Investment Technologies, Inc.,
Changing Times, Forbes, Fortune, Institutional Investor,
Investors Business Daily, Money, Morningstar Mutual Fund
Values, The New York Times, USA Today and The Wall Street
Journal. To the extent any advertisement or sales literature
of a Fund describes the expenses or performance of any Class
it will also disclose such information for the other
Classes.

Average Annual Total Return

"Average annual total return" figures are computed according
to a formula prescribed by the SEC. The formula can be
expressed as follows:

	P (1 + T)n = ERV

	Where:	P	=	a hypothetical initial payment
of $ 1,000.
			T	=	average annual total return.
			n	=	number of years.
			ERV	=	Ending Redeemable Value of a
hypothetical $1,000
					investment made at the
beginning of a 1-, 5- or 10-year
					period at the end of the 1-,
5- or 10-year period (or
					fractional portion thereof),
assuming reinvestment of all
					dividends and distributions.

The ERV assumes complete redemption of the hypothetical
investment at the end of the measuring period.  A Fund's net
investment income changes in response to fluctuations in
interest rates and the expenses of a Fund.

Global Biotechnology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(17.67)%
Class B2
N/A
N/A
N/A
(17.83)%
Class L3
N/A
N/A
N/A
(15.23)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.

Global Media & Telecommunications Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(12.67)%
Class B2
N/A
N/A
N/A
(12.75)%
Class L3
N/A
N/A
N/A
(9.99)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.


Global Technology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(26.83)%
Class B2
N/A
N/A
N/A
(26.92)%
Class L3
N/A
N/A
N/A
(24.60)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.

Aggregate Total Return

A Fund's "aggregate total return," as described below,
represents the cumulative change in the value of an
investment in a Fund for the specified period and is
computed by the following formula:
ERV - P
P
	Where: 	P 	=	a hypothetical initial payment
of $10,000.

				ERV	=	Ending Redeemable Value of a
hypothetical $10,000
investment made at the
beginning of the 1-, 5- or 10-
year period at the end of the
1-, 5- or 10-year period (or
fractional portion thereof),
assuming reinvestment of all
dividends and distributions.

The ERV assumes complete redemption of the hypothetical
investment at the end of the measuring period.

Performance will vary from time to time depending on market
conditions, the composition of the Fund's portfolio and
operating expenses. Consequently, any given performance
quotation should not be considered representative of the
Fund's performance for any specified period in the future.
Because performance will vary, it may not provide a basis
for comparing an investment in the Fund with certain bank
deposits or other investments that pay a fixed yield for a
stated period of time.

Global Biotechnology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(17.67)%
Class B2
N/A
N/A
N/A
(17.83)%
Class L3
N/A
N/A
N/A
(15.23)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.

Global Media & Telecommunications Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(12.67)%
Class B2
N/A
N/A
N/A
(12.75)%
Class L3
N/A
N/A
N/A
(9.99)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.



Global Technology Fund
Average Annual Total Return



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n#
Class A1
N/A
N/A
N/A
(26.83)%
Class B2
N/A
N/A
N/A
(26.92)%
Class L3
N/A
N/A
N/A
(24.60)%
Class Y4
N/A
N/A
N/A
N/A
_______________________
	1	The average annual total return figure assumes that
the maximum 5.00% sales charge has been deducted from
the investment at the time of purchase.
	2	The average annual total return figure assumes that
the maximum applicable deferred sales charge has been
deducted from the investment at the time of
redemption.
	3	The average annual total return figure assumes that
the maximum applicable initial and deferred sales
charges have been deducted from the investment at the
time of redemption.
	4	Class Y shares do not incur sales charges nor deferred
sales charges. There is no performance information for
Class Y shares because none were outstanding at the
end of the fiscal year.
	#	Commencement of operations was August 31, 2000.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Dividends and Distributions

Each Fund's policy is to distribute its net investment
income and net realized capital gains, if any, annually.
Each Fund may also pay additional dividends shortly before
December 31 from certain amounts of undistributed ordinary
income and realized capital gains in order to avoid a
federal excise tax liability.

If a shareholder does not otherwise instruct, dividends and
capital gains distributions will be reinvested automatically
in additional shares of the same Class at net asset value,
subject to no sales charge or deferred sales charge.  A
shareholder may change the option at any time by notifying
his Service Agent.  Shareholders whose accounts are held
directly by the sub-transfer agent should notify them in
writing, requesting a change to this reinvest option.

The per share dividends on Class B and Class L shares of a
Fund will be lower than the per share dividends on Class A
and Class Y shares principally as a result of the
distribution fee applicable with respect to Class B and
Class L shares. The per share dividends on Class A shares
will be lower than the per share dividends on Class Y shares
principally as a result of the service fee applicable to
Class A shares. Distributions of capital gains, if any, will
be in the same amount for Class A, Class B, Class L and
Class Y shares.

Taxes

The following is a summary of the material United States
federal income tax considerations regarding the purchase,
ownership and disposition of shares of the Funds.  Each Fund
will be treated as a separate corporation for federal income
tax purposes, including qualification as a regulated
investment company; and the following discussion applies
separately to each Fund. Each prospective shareholder is
urged to consult his own tax adviser with respect to the
specific federal, state, local and foreign tax consequences
of investing in a Fund.  The summary is based on the laws in
effect on the date of this SAI, which are subject to change.

The Funds and Their Investments

Each Fund intends to continue to qualify to be treated as a
regulated investment company each taxable year under the
Code. To so qualify, a Fund must, among other things: (a)
derive at least 90% of its gross income in each taxable year
from dividends, interest, payments with respect to
securities loans and gains from the sale or other
disposition of stock or securities or foreign currencies, or
other income (including, but not limited to, gains from
options, futures or forward contracts) derived with respect
to its business of investing in such stock, securities or
currencies; and (b) diversify its holdings so that, at the
end of each quarter of the Fund's taxable year, (i) at least
50% of the market value of the Fund's assets is represented
by cash, securities of other regulated investment companies,
United States government securities and other securities,
with such other securities limited, in respect of any one
issuer, to an amount not greater than 5% of the Fund's
assets and not greater than 10% of the outstanding voting
securities of such issuer and (ii) not more than 25% of the
value of its assets is invested in the securities (other
than United States government securities or securities of
other regulated investment companies) of any one issuer or
any two or more issuers that a Fund controls and which are
determined to be engaged in the same or similar trades or
businesses or related trades or businesses.

As a regulated investment company, a Fund will not be
subject to United States federal income tax on its
investment company taxable income (i.e., income other than
any excess of its net realized long-term capital gains over
its net realized short-term capital losses ("net realized
capital gains") or on its net realized capital gains, if
any, that it distributes to its shareholders, provided that
an amount equal to at least 90% of the sum of its investment
company taxable income, plus or minus certain other
adjustments as specified in the Code, and its net tax-exempt
income for the taxable year is distributed in compliance
with the Code's timing and other requirements but will be
subject to tax at regular corporate rates on any taxable
income or gains it does not distribute.  Furthermore, a Fund
will be subject to a United States corporate income tax with
respect to such distributed amounts in any year it fails to
qualify as a regulated investment company or fails to meet
this distribution requirement. The Code imposes a 4%
nondeductible excise tax on a Fund to the extent it does not
distribute by the end of any calendar year at least 98% of
its net investment income for that year and 98% of the net
amount of its capital gains (both long-term and short-term)
for the one-year period ending, as a general rule, on
October 31 of that year.  For this purpose, however, any
income or gain retained by a Fund that is subject to
corporate income tax will be considered to have been
distributed by year-end.  In addition, the minimum amounts
that must be distributed in any year to avoid the excise tax
will be increased or decreased to reflect any
underdistribution or overdistribution, as the case may be,
from the previous year.  Each Fund anticipates that it will
pay such dividends and will make such distributions as are
necessary in order to avoid the application of this tax.

On October 31, 2000, with regard to the Global Biotechnology
Fund and Global Media & Telecommunications Fund, the unused
capital loss carryforwards were approximately $21,902 and
54,076, respectively. For federal income tax purposes, this
amount is available to be applied against future capital
gains of the Fund, if it has carryforwards, that are
realized prior to the expiration of the applicable
carryforward.  Each Fund's carryforwards expire on October
31, 2008.

If, in any taxable year, a Fund fails to qualify as a
regulated investment company under the Code or fails to meet
the distribution requirement, it would be taxed in the same
manner as an ordinary corporation and distributions to its
shareholders would not be deductible by the Fund in
computing its taxable income.  In addition, in the event of
a failure to qualify, the Fund's distributions, to the
extent derived from the Fund's current or accumulated
earnings and profits, would constitute dividends (eligible
for the corporate dividends-received deduction) which are
taxable to shareholders as ordinary income, even though
those distributions might otherwise (at least in part) have
been treated in the shareholder's hands as long-term capital
gains.  If a Fund fails to qualify as a regulated investment
company in any year, it must pay out its earnings and
profits accumulated in that year in order to qualify again
as a regulated investment company. In addition, if a Fund
failed to qualify as a regulated investment company for a
period greater than one taxable year, the Fund may be
required to recognize any net built-in gains (the excess of
the aggregate gains, including items of income, over
aggregate losses that would have been realized if it had
been liquidated) with respect to certain of its assets in
order to qualify as a regulated investment company in a
subsequent year.

A Fund's transactions in foreign currencies, forward
contracts, options and futures contracts (including options
and futures contracts on foreign currencies) will be subject
to special provisions of the Code (including provisions
relating to "hedging transactions" and "straddles") that,
among other things, may affect the character of gains and
losses realized by the Fund (i.e., may affect whether gains
or losses are ordinary or capital), accelerate recognition
of income to the Fund and defer Fund losses. These rules
could therefore affect the character, amount and timing of
distributions to shareholders. These provisions also (a)
will require a Fund to mark-to-market certain types of the
positions in its portfolio (i.e., treat them as if they were
closed out) and (b) may cause a Fund to recognize income
without receiving cash with which to pay dividends or make
distributions in amounts necessary to satisfy the
distribution requirements for avoiding income and excise
taxes. Each Fund will monitor its transactions, will make
the appropriate tax elections and will make the appropriate
entries in its books and records when it acquires any
foreign currency, forward contract, option, futures contract
or hedged investment in order to mitigate the effect of
these rules and prevent disqualification of the Fund as a
regulated investment company.

Each Fund's investment in Section 1256 contracts, such as
regulated futures contracts, most forward currency contracts
traded in the interbank market and options on most stock
indices, are subject to special tax rules.  All section 1256
contracts held by a Fund at the end of its taxable year are
required to be marked to their market value, and any
unrealized gain or loss on those positions will be included
in the Fund's income as if each position had been sold for
its fair market value at the end of the taxable year.  The
resulting gain or loss will be combined with any gain or
loss realized by the Fund from positions in section 1256
contracts closed during the taxable year.  Provided such
positions were held as capital assets and were not part of a
"hedging transaction" nor part of a "straddle," 60% of the
resulting net gain or loss will be treated as long-term
capital gain or loss, and 40% of such net gain or loss will
be treated as short-term capital gain or loss, regardless of
the period of time the positions were actually held by the
Fund.

Index Swaps. As a result of entering into index swaps, a
Fund may make or receive periodic net payments. It may also
make or receive a payment when a swap is terminated prior to
maturity through an assignment of the swap or other closing
transaction. Periodic net payments will constitute ordinary
income or deductions, while termination of a swap will
result in capital gain or loss (which will be a long-term
capital gain or loss if the Fund has been a party to the
swap for more than one year).

Foreign Investments.  Dividends or other income (including,
in some cases, capital gains) received by a Fund from
investments in foreign securities may be subject to
withholding and other taxes imposed by foreign countries.
Tax conventions between certain countries and the United
States may reduce or eliminate such taxes in some cases. A
Fund will not be eligible to elect to treat any foreign
taxes paid by it as paid by its shareholders, who therefore
will not be entitled to credits for such taxes on their own
tax returns.  Foreign taxes paid by a Fund will reduce the
return from the Fund's investments.

Passive Foreign Investment Companies.  If a Fund purchases
shares in certain foreign investment entities, called
"passive foreign investment companies" (a "PFIC"), it may be
subject to United States federal income tax on a portion of
any "excess distribution" or gain from the disposition of
such shares even if such income is distributed as a taxable
dividend by the Fund to its shareholders.  Additional
charges in the nature of interest may be imposed on the Fund
in respect of deferred taxes arising from such distributions
or gains.  If a Fund were to invest in a PFIC and elected to
treat the PFIC as a "qualified electing fund" under the
Code, in lieu of the foregoing requirements, the Fund might
be required to include in income each year a portion of the
ordinary earnings and net capital gains of the qualified
electing fund, even if not distributed to the Fund, and such
amounts would be subject to the 90% and excise tax
distribution requirements described above.  In order to make
this election, a Fund would be required to obtain certain
annual information from the PFICs in which it invests, which
may be difficult or not possible to obtain.

Alternatively, a Fund may make a mark-to-market election
that would result in the Fund being treated as if it had
sold and repurchased all of the PFIC stock at the end of
each year.  In this case, the Fund would report gains as
ordinary income and would deduct losses as ordinary losses
to the extent of previously recognized gains.  The election,
once made, would be effective for all subsequent taxable
years of the Fund, unless revoked with the consent of the
Internal Revenue Service (the "IRS").  By making the
election, a Fund could potentially ameliorate the adverse
tax consequences with respect to its ownership of shares in
a PFIC, but in any particular year may be required to
recognize income in excess of the distributions it receives
from PFICs and its proceeds from dispositions of PFIC stock.
A Fund may have to distribute this "phantom" income and gain
to satisfy its distribution requirement and to avoid
imposition of the 4% excise tax.  Each Fund will make the
appropriate tax elections, if possible, and take any
additional steps that are necessary to mitigate the effect
of these rules.

Taxation of United States Shareholders

Dividends and Distributions.  Any dividend declared by a
Fund in October, November or December of any calendar year
and payable to shareholders of record on a specified date in
such a month shall be deemed to have been received by each
shareholder on December 31 of such calendar year and to have
been paid by the Fund not later than such December 31,
provided such dividend is actually paid by the Fund during
January of the following calendar year. Each Fund intends to
distribute annually to its shareholders substantially all of
its investment company taxable income and any net realized
capital gains. However, if a Fund retains for investment an
amount equal to all or a portion of its net realized capital
gains, it will be subject to a corporate tax (currently at a
rate of 35%) on the amount retained. In that event, the Fund
will designate such retained amounts as undistributed
capital gains in a notice to its shareholders who (a) will
be required to include in income for United Stares federal
income tax purposes, as long-term capital gains, their
proportionate shares of the undistributed amount, (b) will
be entitled to credit their proportionate shares of the 35%
tax paid by the Fund on the undistributed amount against
their United States federal income tax liabilities, if any,
and to claim refunds to the extent their credits exceed
their liabilities, if any, and (c) will be entitled to
increase their tax basis, for United States federal income
tax purposes, in their shares by an amount equal to 65% of
the amount of undistributed capital gains included in the
shareholder's income.  Organizations or persons not subject
to federal income tax on such capital gains will be entitled
to a refund of their pro rata share of such taxes paid by
the Fund upon filing appropriate returns or claims for
refund with the IRS.

Dividends of net investment income and distributions of net
realized short-term capital gains are taxable to a United
States shareholder as ordinary income, whether paid in cash
or in shares.  Distributions of net-long-term capital gains,
if any, that a Fund designates as capital gains dividends
are taxable as long-term capital gains, whether paid in cash
or in shares and regardless of how long a shareholder has
held shares of the Fund.  Dividends and distributions paid
by a Fund attributable to dividends on stock of U.S.
corporations received by the Fund, with respect to which the
Fund meets certain holding period requirements, will be
eligible for the deduction for dividends received by
corporations. Distributions in excess of a Fund's current
and accumulated earnings and profits will, as to each
shareholder, be treated as a tax-free return of capital to
the extent of a shareholder's basis in his shares of the
Fund, and as a capital gain thereafter (if the shareholder
holds his shares of the Fund as capital assets).

Shareholders receiving dividends or distributions in the
form of additional shares should be treated for United
States federal income tax purposes as receiving a
distribution in an amount equal to the amount of money that
the shareholders receiving cash dividends or distributions
will receive, and should have a cost basis in the shares
received equal to such amount.

Investors considering buying shares just prior to a dividend
or capital gain distribution should be aware that, although
the price of shares just purchased at that time may reflect
the amount of the forthcoming distribution, such dividend or
distribution may nevertheless be taxable to them. If a Fund
is the holder of record of any stock on the record date for
any dividends payable with respect to such stock, such
dividends are included in the Fund's gross income not as of
the date received but as of the later of (a) the date such
stock became ex-dividend with respect to such dividends
(i.e., the date on which a buyer of the stock would not be
entitled to receive the declared, but unpaid, dividends) or
(b) the date the Fund acquired such stock.  Accordingly, in
order to satisfy its income distribution requirements, a
Fund may be required to pay dividends based on anticipated
earnings, and shareholders may receive dividends in an
earlier year than would otherwise be the case.

Sales of Shares.  Upon the sale or exchange of his shares, a
shareholder will realize a taxable gain or loss equal to the
difference between the amount realized and his basis in such
shares.  Such gain or loss will be treated as capital gain
or loss, if the shares are capital assets in the
shareholder's hands, and will be long-term capital gain or
loss if the shares are held for more than one year and
short-term capital gain or loss if the shares are held for
one year or less.  Any loss realized on a sale or exchange
will be disallowed to the extent the shares disposed of are
replaced, including replacement through the reinvesting of
dividends and capital gains distributions in a Fund, within
a 61-day period beginning 30 days before and ending 30 days
after the disposition of the shares.  In such a case, the
basis of the shares acquired will be increased to reflect
the disallowed loss.  Any loss realized by a shareholder on
the sale of a Fund share held by the shareholder for six
months or less will be treated for United States federal
income tax purposes as a long-term capital loss to the
extent of any distributions or deemed distributions of long-
term capital gains received by the shareholder with respect
to such share. If a shareholder incurs a sales charge in
acquiring shares of a Fund, disposes of those shares within
90 days and then acquires shares in a mutual fund for which
the otherwise applicable sales charge is reduced by reason
of a reinvestment right (e.g., an exchange privilege), the
original sales charge will not be taken into account in
computing gain or loss on the original shares to the extent
the subsequent sales charge is reduced.  Instead, the
disregarded portion of the original sales charge will be
added to the tax basis in the newly acquired shares.
Furthermore, the same rule also applies to a disposition of
the newly acquired shares made within 90 days of the second
acquisition.  This provision prevents a shareholder from
immediately deducting the sales charge by shifting his or
her investment in a family of mutual funds.

Backup Withholding.  A Fund may be required to withhold, for
United States federal income tax purposes, 31% of the
dividends, distributions and redemption proceeds payable to
shareholders who fail to provide the Fund with their correct
taxpayer identification number or to make required
certifications, or who have been notified by the IRS that
they are subject to backup withholding. Certain shareholders
are exempt from backup withholding. Backup withholding is
not an additional tax and any amount withheld may be
credited against a shareholder's United States federal
income tax liabilities.

Notices.  Shareholders will be notified annually by each
Fund as to the United States federal income tax status of
the dividends, distributions and deemed distributions
attributable to undistributed capital gains (discussed above
in "Taxes- Taxation of United States Shareholders -
Dividends and Distributions") made by the Fund to its
shareholders.  Furthermore, shareholders will also receive,
if appropriate, various written notices after the close of a
Fund's taxable year regarding the United States federal
income tax status of certain dividends, distributions and
deemed distributions that were paid (or that are treated as
having been paid) by the Fund to its shareholders during the
preceding taxable year.

Other Taxation

Distributions also may be subject to additional state, local
and foreign taxes depending on each shareholder's particular
situation.

The foregoing is only a summary of certain material tax
consequences affecting each Fund and its shareholders.
Shareholders are advised to consult their own tax advisers
with respect to the particular tax consequences to them of
an investment in the Funds.

OTHER INFORMATION ABOUT THE COMPANY

The Company was incorporated under the laws of the State of
Maryland on July 16, 1986 under the name Shearson Lehman
Precious Metals and Minerals Fund Inc.  As the name of its
sponsor has changed, the Company's name has been changed on
December 19, 1995 to Smith Barney Natural Resources Fund
Inc. (the "Natural Resources Fund").  On November 29, 1999,
the Board of Directors voted to amend the Charter of the
Company to change its name to Smith Barney Sector Series
Inc. Each of the Financial Services Fund, Health Sciences
Fund, Technology Fund, Global Biotechnology Fund, Global
Media & Telecommunications Fund, and Global Technology is
classified as a series of the Company.  On December 15,
2000, the Natural Resources Fund merged into the Smith
Barney Fundamental Value Fund Inc.

The Company offers shares of seven separate series with a
par value of $.001 per share. Each Fund offers shares
currently classified into four Classes - A, B, L and Y. Each
Class of the Fund represents an identical interest in the
Fund's investment portfolio. As a result, the Classes have
the same rights, privileges and preferences, except with
respect to: (a) the designation of each Class; (b) the
effect of the respective sales charges; if any, for each
Class; (c) the distribution and/or service fees borne by
each Class pursuant to the Plan; (d) the expenses allocable
exclusively to each Class; (e) voting rights on matters
exclusively affecting a single Class; (f) the exchange
privilege of each Class; and (g) the conversion feature of
the Class B shares.  The Company's Board of Directors does
not anticipate that there will be any conflicts among the
interests of the holders of the different Classes.  The
Directors, on an ongoing basis, will consider whether any
such conflict exists and, if so, take appropriate action.

As permitted by Maryland law, there will normally be no
meetings of shareholders for the purpose of electing
Directors unless and until such time as less than a majority
of the Directors holding office have been elected by
shareholders.  At that time, the Directors then in office
will call a shareholder's meeting for the election of
Directors.  The Directors must call a meeting of
shareholders for the purpose of voting upon the question of
removal of any Director when requested in writing to do so
by the record holders of not less than 10% of the
outstanding shares of the Fund.  At such a meeting, a
Director may be removed after the holders of record of not
less than a majority of the outstanding shares of the Fund
have declared that the Director be removed either by
declaration in writing or by votes cast in person or by
proxy.  Except as set forth above, the Directors shall
continue to hold office and may appoint successor directors.

As used in the Prospectus and this Statement of Additional
Information, a "vote of a majority of the outstanding voting
securities" means the affirmative vote of the lesser of (a)
more than 50% of the outstanding shares of the Company (or
the affected series or Class) or (b) 67% or more of such
shares present at a meeting if more than 50% of the
outstanding shares of the Company (or the affected series or
Class) are represented at the meeting in person or by proxy.
A series or Class shall be deemed to be affected by a matter
unless it is clear that the interests of each series or
Class in the matter are identical or that the matter does
not affect any interest of the series or Class.  The
approval of a management agreement or any change in a
fundamental investment policy would be effectively acted
upon with respect to the Fund only if approved by a "vote of
a majority of the outstanding voting securities" of the
Fund; however, the ratification of independent accountants,
the election of Directors, and the approval of a
distribution agreement submitted to shareholders are not
subject to the separate voting requirements and may be
effectively acted upon by a vote of the holders of a
majority of all Company shares voting without regard to
series or Class.

Annual and Semi-annual Reports.  Shareholders are sent a
semi-annual report and an audited annual report with respect
to each Fund, which include listings of investment
securities held by the Fund at the end of the period
covered.  In an effort to reduce the Company's expenses, the
Company consolidates the mailing of its semi-annual and
annual reports by household. This consolidation means that a
household having multiple accounts with the identical
address of record will receive a single copy of each report.
In addition, the Company also consolidates the mailing of
its Prospectus so that a shareholder having multiple
accounts (that is, individual, IRA and/or Self-Employed
Retirement Plan accounts) will receive a single Prospectus
annually. Shareholders who do not want this consolidation to
apply to their accounts should contact their Salomon Smith
Barney Financial Consultant or the transfer agent.

FINANCIAL STATEMENTS

The Funds' Annual Reports for the fiscal year ended October
31, 2000 are incorporated herein by reference in their
entirety.  The annual reports were filed on January 4, 2001,
Accession Number 930413-01-0019.

OTHER  INFORMATION

Styles of Fund Management: In an industry where the average
portfolio manager has seven years of experience (source:
ICI, 1998), the portfolio managers of Smith Barney mutual
funds average 21 years in the industry and 15 years with the
firm.

Smith Barney mutual funds offers more than 60 mutual funds.
We understand that many investors prefer an active role in
allocating the mix of funds in their portfolio, while others
want the asset allocation decisions to be made by
experienced managers.
That's why we offer five "styles" of fund management that
can be tailored to suit each investor's unique financial
goals.

	Classic Series  - our portfolio manager driven funds
Our Classic Series lets investors participate in
mutual funds whose investment decisions are determined
by experienced portfolio managers, based on each
fund's investment objectives and guidelines.  Classic
Series funds invest across asset classes and sectors,
utilizing a range of strategies in order to achieve
their objectives.

	Index Series - funds that track the market
Our Index funds are designed to provide investment
results that track, as closely as possible, the
performance of a stock or bond market index.  This
strategy distinguishes an index fund from an "actively
managed" mutual fund.  Instead of trying to outperform
a market or segment, a portfolio manager looks to an
index to determine which securities the fund should
own.

	Premier Selections Series - our best ideas,
concentrated funds
We offer a series of Premier Selections funds managed
by several of our most experienced and proven
managers.  This series of funds is built on a unique
strategy of combining complementary investment
management styles to create broader, multiclass and
multicap products that are distinguished by a highly
concentrated focus.

Research Series - driven by exhaustive fundamental
securities analysis
Built on a foundation of substantial buy-side research
under the direction of our Citibank Global Asset
Management (CGAM) colleagues, our Research funds focus
on well-defined industries, sectors and trends.

Style Pure Series - our solution to funds that stray
Our Style Pure Series funds are the building blocks of
asset allocation.  The funds stay fully invested
within their asset class and investment style,
enabling you to make asset allocation decisions in
conjunction with your financial professional.

































SMITH BARNEY
SECTOR SERIES INC.



Global Biotechnology Fund

Global Media &
Telecommunications Fund

Global Technology Fund
















February 28, 2001



SMITH BARNEY SECTOR SERIES INC.
7 World Trade Center
New York, NY 10048

SALOMON SMITH BARNEY
A Member of
Citigroup [Symbol]