SecProbe.io

<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>corresp_092804-sp500geared.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
                      [SHEARMAN & STERLING LLP LETTERHEAD]

(212) 848-8519

Writer's Email Address:
jennifer.berman@shearman.com
                               September 28, 2004

John Ganley, Esq.
Division of Investment Management
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

                    S&P 500 GEARED Fund Inc. (the "Company"):
           Registration Statement File Nos. 333-118070 and 811-21611
           ---------------------------------------------------------

Dear Mr. Ganley:

         As requested, attached is a copy of all correspondence the Company
submitted to you on Thursday, September 23, 2004.

                                                      Best regards,

                                                      /s/ Jennifer E. Berman
                                                      ------------------------
                                                      Jennifer E. Berman

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[EMAIL DATED SEPTEMBER 23, 2004, 11:34 PM
FROM: JENNIFER E. BERMAN
TO: GANLEYJ@SEC.GOV
SUBJECT: DISTRIBUTIONS]

Here is the Distribution section that we discussed on our call on 9/23/2004.
         --- Forwarded by Jennifer E Berman/NY/NA/ShS on 09/23/2004 11:34 PM ---

         [EMAIL DATED SEPTEMBER 22, 2004, 9:34 PM
         FROM: JENNIFER.BERMAN@SHEARMAN.COM
         TO: JENNIFER.BERMAN@SHEARMAN.COM
         SUBJECT: DISTRIBUTIONS]

                                      * * *

[THE ATTACHMENT TITLED "Distribution Rider_.doc" READS AS FOLLOWS:]

Rider to be inserted after "US Federal Tax" and before "Automatic Dividend
Reinvestment Plan"

                                  DISTRIBUTIONS

     The Fund intends to distribute, for each annual period, net of Fund
expenses, positive returns, if any, up to the Annual Return Cap, as well as
dividend income, if any, from its investments. The Fund intends to make one such
distribution at the end of each year to the extent there are positive returns
and/or dividend income in excess of Fund expenses. This dividend policy may be
modified by the Board of Directors from time to time. This distribution policy
may, under certain circumstances, have certain adverse consequences to the Fund
and its stockholders because it may result in a return of capital to
stockholders which would reduce the Fund's net asset value and, over time,
potentially increase the Fund's expense ratio.

     The Fund's positive returns, if any, from its investment strategy (after
Fund expenses) that will be distributed in respect of an annual period, together
with any net dividend income, may exceed the Fund's current and accumulated
earnings and profits for that year. This might occur because one-third of the
Fund's positive returns (if any) for each annual period will be attributable to
its ownership of the long S&P 500(R) Index portfolio on which little or no
taxable gain is expected to be recognized prior to termination of the Fund
(except to the extent securities may be sold or otherwise disposed of to fund
repurchase offers, distributions to stockholders and payments on the written
call options, if applicable). As a result, the Fund expects that a portion of
its annual distributions prior to its final liquidation will constitute a
tax-free return of capital. See "U.S. Federal Income Tax Considerations" on page
33 of this Prospectus.

         Section 19(a) of the Investment Company Act of 1940 and Rule 19a-1
thereunder require the Fund under certain circumstances to provide a written
statement accompanying any dividend or distribution that adequately discloses
its source or sources. Thus, if the source of the dividend

                                       2
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or other distribution were the original capital contribution of the stockholder,
and the payment amounted to a return of capital, the Fund would be required to
provide written disclosure to that effect. Nevertheless, persons who annually
receive the payment of a dividend or other distribution from the Fund may be
under the impression that they are receiving net profits when they are not.
Stockholders should read any written disclosure provided pursuant to Section
19(a) and Rule 19a-1 carefully, and should not assume that the source of any
distribution from the Fund is net profit. In addition, in cases where the Fund
would return capital to stockholders, such distribution may impact the Fund's
ability to maintain its asset coverage requirements and to pay the interest on
Fund borrowings, if any should be outstanding.

                                       3
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[EMAIL DATED SEPTEMBER 23, 2004, 1:58 PM
FROM: JENNIFER E. BERMAN
TO: GANLEYJ@SEC.GOV
SUBJECT: RIDERS]

John,

Attached are the rest of the riders requested - please give me a call when you
have looked at them.

Thank you,
Jen Berman

                                      * * *

[THE ATTACHMENT TITLED "lr7x01!.DOC" READS AS FOLLOWS:]

RIDERS

[To be included under "Who Should Invest"]

Historically, the S&P 500(R) Index has not tended to have annual returns that
fall within a relatively narrow band of positive Index performance. As a result,
the Fund is likely to underperform the Index if the annual return of the S&P
500(R) Index over the next five years performs in accordance with the historical
pattern.

[To be included under new Risk Factor "Returns to Individual Stockholders"]

Return to Individual Stockholders. The returns of the Fund for purposes of its
investment objective will be measured as of the end of each annual period in
relation to the value of the Index as of the beginning of that period. Each
annual period will consist of approximately twelve months, but will not be a
calendar year. A stockholder who buys shares of the Fund at a time other than at
or prior to the inception of an annual period and who does not hold those shares
through the date on which the Fund distributes its returns in respect of that
annual period, might not receive the full benefit of the Fund's returns even if
the Fund achieves the Annual Return Cap for that annual period. There can be no
assurance that the Fund's returns for any annual period will achieve the Annual
Return Cap. See "Risk Factors and Special Considerations - Closed End Structure;
Market Discount from Net Asset Value" and "Distributions" on pages _ and _,
respectively, of this Prospectus.

                                       4
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[EMAIL DATED SEPTEMBER 23, 2004, 2:35 PM
FROM: JENNIFER E. BERMAN
TO: GANLEYJ@SEC.GOV
SUBJECT: RIDERS]

Attached you will find the third rider. Thank you for all of your help in this
process.

-Jen Berman

                                      * * *

[THE ATTACHMENT TITLED "lr7x01!.DOC" READS AS FOLLOWS:]

RIDERS

[To be included under "Who Should Invest"]

Historically, the S&P 500(R) Index has not tended to have annual returns that
fall within a relatively narrow band of positive Index performance. As a result,
the Fund is likely to underperform the Index if the annual return of the S&P
500(R) Index over the next five years performs in accordance with the historical
pattern.

[To be included under new Risk Factor "Returns to Individual Stockholders"]

Return to Individual Stockholders. The returns of the Fund for purposes of its
investment objective will be measured as of the end of each annual period in
relation to the value of the Index as of the beginning of that period. Each
annual period will consist of approximately twelve months, but will not be a
calendar year. A stockholder who buys shares of the Fund at a time other than at
or prior to the inception of an annual period and who does not hold those shares
through the date on which the Fund distributes its returns in respect of that
annual period, might not receive the full benefit of the Fund's returns even if
the Fund achieves the Annual Return Cap for that annual period. There can be no
assurance that the Fund's returns for any annual period will achieve the Annual
Return Cap. See "Risk Factors and Special Considerations - Closed End Structure;
Market Discount from Net Asset Value" and "Distributions" on pages _ and _,
respectively, of this Prospectus.

[To be included under "Calculating the Maximum Index Participation and Annual
Return Cap"]

The subadviser to the Fund will, through a competitive bidding process with a
variety of qualified counterparties, attempt to structure the Transactions to
achieve the highest possible Maximum Index Participation and, accordingly, the
highest possible Annual Return Cap. While the Board of Directors generally
oversees the operations of the Fund, the Board of Directors does not participate
in setting the Annual Return Cap.

                                       5

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