Exhibit 4(e)

                          INVESTMENT ADVISORY AGREEMENT

      AGREEMENT  made as of  November 1, 2000,  by and  between  MERCURY  TARGET
SELECT EQUITY FUND,  INC. (the "Fund") and FUND ASSET  MANAGEMENT,  L.P.,  doing
business  as  MERCURY  ADVISORS  (hereinafter  referred  to as  the  "Investment
Adviser"), a Delaware limited partnership.

                              W I T N E S S E T H:

      WHEREAS,  the  Fund is  engaged  in  business  as an  open-end  management
investment  company  registered  under the  Investment  Company Act of 1940,  as
amended (hereinafter referred to as the "Investment Company Act");

      WHEREAS,  the Directors of the Fund (the "Directors") have determined that
the Fund will  operate as a feeder  fund that seeks to  achieve  its  investment
objectives  by  investing  all of its assets in shares of a master fund or other
pooled  investment  vehicle with the same investment  objectives and policies as
the Fund, and the Directors intend such arrangement to continue indefinitely;

      WHEREAS,  the  Directors  may,  at some  future  time,  direct the Fund to
withdraw  all of its  assets  from the shares of a master  fund or other  pooled
investment  vehicle and invest  directly in portfolio  securities  in accordance
with its investment objectives and policies;

      WHEREAS,  the  Investment  Adviser is  engaged  principally  in  rendering
management and investment  advisory  services and is registered as an investment
adviser under the Investment Advisers Act of 1940;

      WHEREAS,  the Fund  desires  to retain the  Investment  Adviser to provide
management and investment advisory services to the Fund in the manner and on the
terms hereinafter set forth; and

      WHEREAS,  the  Investment  Adviser is willing  to provide  management  and
investment  advisory services to the Fund on the terms and conditions  hereafter
set forth.

      NOW,  THEREFORE,  in  consideration  of the  premises  and  the  covenants
hereinafter  contained,  the Fund and the  Investment  Adviser  hereby  agree as
follows:

                                    ARTICLE I
                        DUTIES OF THE INVESTMENT ADVISER

      The Fund  hereby  employs the  Investment  Adviser to act as a manager and
investment  adviser of the Fund and to furnish,  or arrange for other persons or
entities (including,  without limitation,  affiliates of the Investment Adviser)
to furnish, the management and investment advisory services

<PAGE>

described  below,  subject to the policies of, review by and overall  control of
the Directors,  for the period and on the terms and conditions set forth in this
Agreement.  The Investment  Adviser  hereby  accepts such  employment and agrees
during such period, at its own expense,  to render, or arrange for the rendering
of,  such  services  and to  assume  the  obligations  herein  set forth for the
compensation  provided for herein.  The  Investment  Adviser and its  affiliates
shall for all purposes herein be deemed to be independent contractors and shall,
unless otherwise expressly provided or authorized,  have no authority to act for
or represent the Fund in any way or otherwise be deemed agents of the Fund.

            (a) Management  Services.  The Investment  Adviser shall perform (or
      arrange for the performance of) the management and administrative services
      necessary  for the  operation of the Fund, to the extent such services are
      not  otherwise  provided  for pursuant to an  Administration  Agreement to
      which the Fund is a party.  The Investment  Adviser shall provide the Fund
      with office space, facilities,  equipment and necessary personnel and such
      other  services  as the  Investment  Adviser,  subject  to  review  by the
      Directors,  shall from time to time determine to be necessary or useful to
      perform its obligations under this Agreement. The Investment Adviser shall
      also, on behalf of the Fund, conduct relations (or arrange for the conduct
      of  such  relations)  with  custodians,   depositories,  transfer  agents,
      dividend   disbursing   agents,   other   shareholder   servicing  agents,
      accountants,  attorneys,  underwriters,  brokers  and  dealers,  corporate
      fiduciaries,  insurers,  banks and such  other  persons  in any such other
      capacity deemed to be necessary or desirable. The Investment Adviser shall
      generally monitor (or arrange for the monitoring of) the Fund's compliance
      with investment policies and restrictions as set forth in the Registration
      Statement of the Fund filed with the  Securities  and Exchange  Commission
      under  the  Investment  Company  Act,  as  amended  from time to time (the
      "Registration  Statement").  The Investment Adviser shall make reports (or
      arrange  for  the  making  of  such  reports)  to  the  Directors  of  its
      performance   of   obligations    hereunder   and   furnish   advice   and
      recommendations  with  respect to such other  aspects of the  business and
      affairs of the Fund as it shall determine to be desirable.

            (b)  Investment  Advisory  Services.  The  Investment  Adviser shall
      provide (or arrange for the  provision  of) the Fund with such  investment
      research,  advice  and  supervision  as the  latter  may from time to time
      consider  necessary for the proper  supervision of the assets of the Fund,
      shall  furnish  (or  arrange  for  the  furnishing  of)   continuously  an
      investment  program for the Fund and shall  determine  (or arrange for the
      determination  of) from time to time which  securities shall be purchased,
      sold or exchanged and what portion of the assets of the Fund shall be held
      in the various  securities  and other  financial  instruments in which the
      Fund invests or cash,  subject always to the  restrictions of the Articles
      of  Incorporation  and By-Laws of the Fund,  as amended from time to time,
      the provisions of the Investment  Company Act and the statements  relating
      to the Fund's investment  objectives,  investment  policies and investment
      restrictions as the same are set forth in the Fund's current  Registration
      Statement. The Investment Adviser shall make decisions (or arrange for the
      making of such  decisions)  for the Fund as to the manner in which  voting
      rights,  rights to  consent  to  corporate  action  and any  other  rights
      pertaining to the Fund's portfolio securities


                                        2
<PAGE>

      shall be exercised.  Should the Directors at any time,  however,  make any
      definite  determination as to investment  policy and notify the Investment
      Adviser thereof in writing,  the Investment Adviser shall be bound by such
      determination  for the period,  if any,  specified in such notice or until
      similarly  notified  that  such   determination  has  been  revoked.   The
      Investment  Adviser  shall  take,  on behalf of the Fund,  all actions (or
      arrange for the taking of all such  actions)  which it deems  necessary to
      implement the investment  policies  determined as provided  above,  and in
      particular  to place all  orders  for the  purchase  or sale of  portfolio
      securities for the Fund's account with brokers or dealers  selected by it,
      and to that end, the Investment  Adviser is authorized as the agent of the
      Fund to give instructions to the custodian of the Fund as to deliveries of
      securities and payments of cash for the account of the Fund. In connection
      with the  selection  of such  brokers or dealers  and the  placing of such
      orders  with  respect  to assets of the Fund,  the  Investment  Adviser is
      directed  at all times to seek to obtain  execution  and price  within the
      policy  guidelines  determined  by the Directors and set forth in the then
      current  Registration  Statement.  Subject  to  this  requirement  and the
      provisions of the Investment  Company Act, the Securities  Exchange Act of
      1934, as amended,  and other applicable  provisions of law, the Investment
      Adviser  may  select  brokers  or  dealers  with  which  it or the Fund is
      affiliated.

            (c) Sub-Advisers.  In carrying out its  responsibilities  hereunder,
      the Investment Adviser may employ, retain or otherwise avail itself of the
      services  of other  persons or  entities  (including  without  limitation,
      affiliates of the  Investment  Adviser),  on such terms as the  Investment
      Adviser  shall  determine  to  be  necessary,  desirable  or  appropriate.
      However,  if the Investment  Adviser  chooses to retain or avail itself of
      the services of another  person or entity to manage assets of the Fund, or
      any portion  thereof as  determined by the  Investment  Adviser such other
      person or entity must be (i) retained at the Investment Adviser's own cost
      and expense and (ii) retained subject to the requirements of Section 15 of
      the Investment Company Act. Retention of one or more sub-advisers,  or the
      employment or retention of other persons or entities to perform  services,
      shall  in no  way  reduce  the  responsibilities  or  obligations  of  the
      Investment  Adviser under this Agreement and the Investment  Adviser shall
      be responsible for all acts and omissions of such  sub-advisers,  or other
      persons or entities,  in connection with the performance of the Investment
      Adviser's duties hereunder.

            (d) Notice Upon Change in Partners of the  Investment  Adviser.  The
      Investment  Adviser is a limited  partnership  and its limited  partner is
      Merrill Lynch & Co., Inc. and its general  partner is Princeton  Services,
      Inc.  The  Investment  Adviser  will  notify the Fund of any change in the
      membership of the partnership within a reasonable time after such change.

            (e) The  Investment  Adviser  shall  have no  obligation  to perform
      pursuant to this Article I unless and until the Directors  direct the Fund
      to withdraw all of its assets from shares of a master fund or other pooled
      investment  vehicle and direct the Investment  Adviser to directly  manage
      the  Fund's  assets  in the  manner  and on the  terms  set  forth in this
      Agreement.


                                        3
<PAGE>

                                   ARTICLE II
                       ALLOCATION OF CHARGES AND EXPENSES

            (a) The Investment Adviser.  The Investment Adviser shall assume and
      shall pay, or cause its  affiliate to pay, for  maintaining  the staff and
      personnel  necessary to perform its obligations under this Agreement,  and
      shall,  at its own  expense,  provide  the office  space,  facilities  and
      necessary  personnel  which it is  obligated  to provide  under  Article I
      hereof.  The Investment  Adviser shall pay, or cause its affiliate to pay,
      compensation  of all  Officers  and  all  Directors  of the  Fund  who are
      affiliated persons of the Investment Adviser or any sub-adviser,  or of an
      affiliate of the Investment Adviser or any sub-adviser.

            (b) The Fund.  The Fund  shall  assume  and shall pay or cause to be
      paid all other  expenses of the Fund (except for the expenses  paid by FAM
      Distributors,  Inc. (the "Distributor")),  including,  without limitation:
      taxes,  expenses  for  legal  and  auditing  services,  costs of  printing
      proxies,  shareholder  reports,  copies  of  the  Registration  Statement,
      charges of the custodian,  any sub-custodian and transfer agent,  expenses
      of portfolio  transactions,  expenses of redemption of shares,  Securities
      and Exchange  Commission  fees,  expenses of registering  the shares under
      Federal, state and foreign laws, fees and actual out-of-pocket expenses of
      Directors who are not affiliated  persons of the Investment Adviser or any
      sub-adviser,  or  of  an  affiliate  of  the  Investment  Adviser  or  any
      sub-adviser, accounting and pricing costs (including the daily calculation
      of the net asset value), insurance,  interest, brokerage costs, litigation
      and other  extraordinary  or  non-recurring  expenses,  and other expenses
      properly  payable by the Fund. It is also  understood  that the Fund shall
      reimburse the Investment Adviser or an affiliate of the Investment Adviser
      for  its  costs  in  providing   accounting  services  to  the  Fund.  The
      Distributor  will pay  certain of the  expenses  of the Fund  incurred  in
      connection with the continuous  offering of shares of beneficial  interest
      of the Fund.

            (c) No payment or  reimbursement  of charges and  expenses  shall be
      accrued  or  payable  under  this  Article  II by  either  the Fund or the
      Investment  Adviser  unless and until the  Directors  direct that the Fund
      withdraw  all of its assets from  shares of a master fund or other  pooled
      investment  vehicle and direct the Investment  Adviser to directly  manage
      the  Fund's  assets  in the  manner  and on the  terms  set  forth in this
      Agreement.

                                   ARTICLE III
                     COMPENSATION OF THE INVESTMENT ADVISER

      (a) Management and Investment Advisory Fee. For the services rendered, the
facilities  furnished and expenses assumed by the Investment  Adviser,  the Fund
shall pay to the  Investment  Adviser  at the end of each  calendar  month a fee
based upon the average  daily value of the net assets of the Fund, as determined
and computed in accordance  with the  description  of the  determination  of net
asset  value  contained  in the  Registration  Statement,  at the annual rate of
1.0625%  of the  average  daily net  assets of the Fund,  commencing  on the day
following effectiveness hereof. If this


                                        4
<PAGE>

Agreement  becomes  effective  subsequent  to the  first day of a month or shall
terminate  before  the last day of a month,  compensation  for that  part of the
month this Agreement is in effect shall be prorated in a manner  consistent with
the  calculation  of the  fee as set  forth  above.  Payment  of the  Investment
Adviser's  compensation  for the  preceding  month  shall be made as promptly as
possible after completion of the  computations  contemplated  above.  During any
period when the  determination of net asset value is suspended by the Directors,
the net  asset  value  of a share  as of the  last  business  day  prior to such
suspension  shall for this  purpose  be deemed to be the net asset  value at the
close of each succeeding business day until it is again determined.

      (b) The Fund shall have no obligation to perform  pursuant to this Article
III unless and until the  Directors  direct  that the Fund  withdraw  all of its
assets  from  shares of a master  fund or other  pooled  investment  vehicle and
direct the Investment Adviser to directly manage the Fund's assets in the manner
and on the  terms  set  forth  in  this  Agreement.  Upon  such  direction,  the
obligation of the Fund to compensate  the  Investment  Adviser in the manner set
forth in this Article III shall accrue upon an effective  date to be  determined
by the Directors.

                                   ARTICLE IV
                LIMITATION OF LIABILITY OF THE INVESTMENT ADVISER

      The  Investment  Adviser  shall not be liable for any error of judgment or
mistake of law or for any loss arising out of any  investment  or for any act or
omission in the  management  of the Fund,  except for willful  misfeasance,  bad
faith or gross  negligence  in the  performance  of its duties,  or by reason of
reckless  disregard of its  obligations  and duties  hereunder.  As used in this
Article IV, the term  "Investment  Adviser"  shall include any affiliates of the
Investment  Adviser  performing  services for the Fund  contemplated  hereby and
partners,  directors,  officers and employees of the Investment Adviser and such
affiliates.

                                    ARTICLE V
                      ACTIVITIES OF THE INVESTMENT ADVISER

      The services of the Investment Adviser to the Fund are not to be deemed to
be exclusive,  and the Investment Adviser and each affiliate and subadviser,  if
any, is free to render  services to others.  It is  understood  that  Directors,
officers, employees and shareholders of the Fund are or may become interested in
the Investment Adviser and its affiliates,  as directors,  officers,  employees,
partners and  shareholders  or otherwise,  and that the  Investment  Adviser and
directors,  officers,  employees,  partners and  shareholders  of the Investment
Adviser and its affiliates are or may become similarly interested in the Fund as
shareholders or otherwise.


                                        5
<PAGE>

                                   ARTICLE VI
                   DURATION AND TERMINATION OF THIS AGREEMENT

      This Agreement shall become  effective as of the date first above written,
and shall remain in force for two years thereafter, and thereafter continue from
year to year, but only so long as such  continuance is specifically  approved at
least  annually  by (i)  the  Directors,  or by the  vote of a  majority  of the
outstanding  voting  securities  of the  Fund,  and  (ii) a  majority  of  those
Directors  who are not parties to this  Agreement or  interested  persons of any
such party cast in person at a meeting  called for the purpose of voting on such
approval.

      This  Agreement may be terminated at any time,  without the payment of any
penalty, by the Directors or by the vote of a majority of the outstanding voting
securities of the Fund,  or by the  Investment  Adviser,  on sixty days' written
notice to the other party. This Agreement shall  automatically  terminate in the
event of its assignment.

                                   ARTICLE VII
                          AMENDMENTS OF THIS AGREEMENT

      This  Agreement  may be amended by the parties  only if such  amendment is
specifically  approved  by (i) the  vote of a  majority  of  outstanding  voting
securities  of the Fund,  and (ii) a  majority  of those  Directors  who are not
parties to this Agreement or interested persons of any such party cast in person
at a meeting called for the purpose of voting on such approval.

                                  ARTICLE VIII
                          DEFINITIONS OF CERTAIN TERMS

      The  terms  "vote  of  majority  of the  outstanding  voting  securities,"
"assignment,"  "affiliated  person" and  "interested  person," when used in this
Agreement,  shall  have the  respective  meanings  specified  in the  Investment
Company Act and the Rules and Regulations thereunder,  subject, however, to such
exemptions as may be granted by the  Securities  and Exchange  Commission  under
said Act.

                                   ARTICLE IX
                                  GOVERNING LAW

      This Agreement  shall be construed in accordance with laws of the State of
New York and the  applicable  provisions of the  Investment  Company Act. To the
extent  that  the  applicable  laws  of the  State  of New  York,  or any of the
provisions  herein,  conflict with the  applicable  provisions of the Investment
Company Act, the latter shall control.


                                        6
<PAGE>

      IN WITNESS  WHEREOF,  the parties  hereto have executed and delivered this
Agreement as of the date first above written.  This Agreement may be executed by
the parties  hereto on any number of  counterparts,  all of which together shall
constitute one and the same instrument.



                              MERCURY TARGET SELECT EQUITY FUND, INC.

                              By:  Terry K. Glenn
                                 ------------------------------------
                              Title: Executive Vice President


                              FUND ASSET MANAGEMENT, L.P., doing business
                              as MERCURY ADVISORS


                              By:  PRINCETON SERVICES, INC.,
                                   GENERAL PARTNER

                              By:  Terry K. Glenn
                                 ------------------------------------
                              Title:  Executive Vice President


                                        7