THE BEAR STEARNS FUNDS
                               S&P STARS Portfolio
                                 245 Park Avenue
                            New York, New York 10167
                                 1-800-766-4111



Dear Shareholder:

YOUR VOTE IS CRITICAL!

About a week ago, we sent you a notice of a special  meeting of  shareholders of
S&P STARS  Portfolio.  At the  special  meeting,  shareholders  will be asked to
approve a new Investment Advisory Agreement with respect to the Portfolio.

The  Portfolio  now  invests  all its assets in a series of the S&P STARS  Fund,
which  has  the  same  investment   objective  as  the  Portfolio.   Under  this
arrangement,  called  a  "master-feeder"  structure,  there  was no need for the
Portfolio to have its own Investment Advisory Agreement.

In an effort to improve the  long-term  viability  of the  Portfolio  and reduce
administrative costs, your Trustees recently approved certain structural changes
that would  consolidate  the operations of the Portfolio and the S&P STARS Fund.
To accomplish  this,  shareholders are being asked to approve the new Investment
Advisory Agreement with respect to the Portfolio.

It is important to note that nothing else will change:
1.    Shareholders will incur no additional fees or expenses under the new 
      agreement.
2.    Robert Reitzes will continue to head the fund's portfolio management
3.    The Portfolio's investment strategy remains the same.
4.    Portfolio holdings remain the same.

This transaction is described in the enclosed Proxy Statement.

PLEASE  TAKE A MOMENT TO SIGN AND RETURN THE  ENCLOSED  PROXY  CARD.  HELP US TO
AVOID ADDITIONAL EXPENSES TO THE PORTFOLIO!

We appreciate your continued support.