An investment in the fund is
not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government
agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible
to lose money by investing in the fund.
The fund's yield will fluctuate as the short-term
securities in its portfolio mature and the proceeds are reinvested in securities with different interest
rates. Additionally, while the fund has maintained a constant share price since inception, and will
continue to try to do so, neither The Dreyfus Corporation nor its affiliates are required to make a capital
infusion, enter into a capital support agreement or take other actions to prevent the fund's share price
from falling below $1.00. The following are the principal risks that could reduce the fund's income
level and/or share price:
·
Interest rate risk.
This risk refers
to the decline in the prices of fixed-income securities that may accompany a rise in the overall level
of interest rates. A sharp and unexpected rise in interest rates could cause a money market fund's share
price to drop below a dollar.
·
Credit risk.
Failure of an issuer to
make timely interest or principal payments, or a decline or perception of a decline in the credit quality
of a security, can cause the security's price to fall, potentially lowering the fund's share price.
Although the fund invests only in high quality debt securities, any of the fund's holdings could have
its credit rating downgraded or could default. The credit quality of the securities held by the fund
can change rapidly in certain market environments, and the default of a single holding could have the
potential to cause significant deterioration of the fund's net asset value.
·
Liquidity risk.
When
there is little or no active trading market for specific types of securities, it can become more difficult
to sell the securities at or near their perceived value. In such a market, the value of such securities
may fall dramatically, potentially lowering the fund's share price, even during periods of declining
interest rates. Also, during such periods, redemptions by a few large investors in the fund may have
a significant adverse effect on the fund's net asset value and remaining fund shareholders.
·
Municipal securities
risk
. The amount of public information available about municipal securities is generally less
than that for corporate equities or bonds. Special factors, such as legislative changes, and state and
local economic and business developments, may adversely affect the yield and/or value of the fund's investments
in municipal securities. Other factors include the general conditions of the municipal securities market,
the size of the particular offering, the maturity of the obligation and the rating of the issue. Changes
in economic, business or political conditions relating to a particular municipal project, municipality,
or state in which the fund invests may have an impact on the fund's share price.
·
Tax risk.
To
be tax-exempt, municipal obligations generally must meet certain regulatory requirements. If any such
municipal obligation fails to meet these regulatory requirements, the interest received by the fund from
its investment in such obligations and distributed to fund shareholders will be taxable.
·
Structured notes risk.
Structured notes, a type of derivative instrument, can be volatile, and the possibility of default by
the financial institution or counterparty may be greater for these instruments than for other types of
money market instruments. Structured notes typically are purchased in privately negotiated transactions
from financial institutions and, thus, an active trading market for such instruments may not exist.
·
State-specific risk.
The fund is subject to the risk that New Jersey's economy, and the revenues underlying its municipal
obligations, may decline. Investing primarily in a single state makes the fund more sensitive to risks
specific to the state and may magnify other risks.
·
Non-diversification risk.
The fund
is non-diversified, which means that a relatively high percentage of the fund's assets may be invested
in a limited number of issuers. Therefore, the fund's performance may be more vulnerable to changes
in the market value of a single issuer or group of issuers and more susceptible to risks associated with
a single economic, political or regulatory occurrence than a diversified fund.
