EMERGING MARKETS PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 1998
(unaudited)
(expressed in U.S. dollars)
Shares Value
- ---------- -----------
COMMON STOCKS & WARRANTS (99.1%)
ARGENTINA (10.5%)
ENERGY
6,860 YPF Sociedad Anonima................................. $ 239,037
-----------
FINANCE
26,055 Banco De Galicia SA.................................. 160,261
11,900 Banco Frances SA..................................... 115,447
-----------
275,708
-----------
SERVICES
7,800 Telecom Argentina Stet - France Telecom SA, ADR...... 280,800
-----------
TOTAL ARGENTINA ..................................... 795,545
-----------
BRAZIL (16.0%)
CONSUMER GOODS
11,500 Compania Cervejaria Brahma, ADR...................... 151,656
-----------
ENERGY
9,000 Centrais Eletricas Brasileiras, ADR* (Electrobas).... 202,181
5,250 Companhia Energetica de Minas Gerais ADR............. 252,400
1,125,000 Pertroleo Brasileiro SA (Petrobras)................. 285,271
-----------
739,852
-----------
SERVICES
2,600 Telecomunicacoes Brasileiras SA, ADR (Telebras)...... 316,713
-----------
TOTAL BRAZIL ........................................ 1,208,221
-----------
GHANA (1.7%)
BANKS
15,000 Standard Chartered Bank Ghana Ltd.*.................. 131,755
-----------
TOTAL GHANA ......................................... 131,755
-----------
GREECE (7.8%)
FOOD & BEVERAGES
8,500 Hellenic Bottling Co. SA............................. 316,327
-----------
TELECOMMUNICATIONS
9,500 Hellenic Telecommunication Organization SA (OTE)..... 271,954
-----------
TOTAL GREECE ........................................ 588,281
-----------
INDIA (7.9%)
CAPITAL EQUIPMENT
10,500 Reliance Industries Ltd., GDR ....................... 96,862
-----------
CONSUMER GOODS
36,000 Ashok Leyland Ltd., GDR............................. 129,600
4,000 Ranbaxy Laboratories Ltd., GDR....................... 100,800
-----------
230,400
-----------
FINANCE
105,450 Industrial Credit & Investment Corp.................. 274,279
-----------
TOTAL INDIA ......................................... 601,541
-----------
INDONESIA (2.4%)
MULTI-INDUSTRY
905,000 PT Astra International Inc........................... 178,172
-----------
TOTAL INDONESIA ..................................... 178,172
-----------
MEXICO (13.2%)
CAPITAL EQUIPMENT
31,500 Fomento Economico Mexicano SA de CV.................. 233,278
-----------
CONSUMER GOODS
57,000 Kimberly-Clark De Mexico, SA de CV .................. 279,959
-----------
MULTI-INDUSTRY
48,800 Cemex SA de CV....................................... 293,491
30,200 Grupo Carso, SA de CV, ADR........................... 190,175
-----------
483,666
-----------
TOTAL MEXICO ........................................ 996,903
-----------
POLAND (6.1%)
BANKS
24,000 Bank Handlowy W Warsza, GDR *........................ 458,400
-----------
TOTAL POLAND ........................................ 458,400
-----------
ROMANIA (3.5%)
FINANCE
51,200 Romania Investment Fund Ltd.......................... 262,400
-----------
TOTAL ROMANIA ....................................... 262,400
-----------
<PAGE>
EMERGING MARKETS PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 1998 (continued)
(unaudited)
(expressed in U.S. dollars)
Shares Value
- ---------- -----------
RUSSIA (11.3%)
ENERGY
4,040 Lukoil Holding, ADR ................................. $ 268,660
6,000 Grazprom ADR......................................... 110,700
13,850 Unified Energy Systems, GDR * ....................... 470,900
-----------
TOTAL RUSSIA ........................................ 850,260
-----------
SOUTH AFRICA (8.6%)
CONSUMER GOODS
6,500 South African Breweries Ltd.......................... 218,124
-----------
FINANCE
7,000 Liberty Life Association
of Africa Ltd....................................... 236,842
-----------
MULTI-INDUSTRY
3,300 Anglo American Corp of South Africa Ltd.............. 195,232
-----------
TOTAL SOUTH AFRICA .................................. 650,198
-----------
TURKEY (10.1%)
CONSUMER GOODS
2,780,000 Arcelik A.S.......................................... 311,422
249,000 Ford Otomotiv Sanayi A.S............................. 179,316
-----------
490,738
-----------
FINANCE
1,830,000 Akbank T.A.S......................................... 155,581
-----------
MATERIALS
2,376,000 Turk Sise Ve Cam Fabfikalari A.S..................... 116,447
-----------
TOTAL TURKEY ........................................ 762,766
-----------
TOTAL INVESTMENTS (identified cost $7,656,967) (a) ..... 99.1% $7,484,442
CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES ......... 0.9 69,822
----- ----------
NET ASSETS ........................................... 100.0% $7,554,264
===== ==========
- ----------
* non-income producing security
(a) The aggregate cost for federal income tax purposes is $7,656,967, the
aggregate gross unrealized appreciation is $693,707, and the aggregate gross
unrealized depreciation is $866,232, resulting in net unrealized
depreciation of $172,525.
See Notes to Financial Statements.
<PAGE>
EMERGING MARKETS PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998
(unaudited)
(expressed in U.S. dollars)
ASSETS:
Investments in securities, at value (identified
cost $7,656,967) (Note 1) ............................... $ 7,484,442
Cash (including $12,626 in foreign currency) .............. 173,977
Dividends and other receivables ........................... 34,763
-----------
Total Assets ......................................... 7,693,182
-----------
LIABILITIES:
Payables for:
Investments purchased ................................... 131,138
Investment advisory fee (Note 2) ........................ 5,540
Expense reimbursement fee (Note 2) ...................... 1,938
Administrative fee (Note 2) ............................. 215
Foreign withholding taxes ............................... 87
-----------
Total Liabilities .................................... 138,918
-----------
NET ASSETS ................................................... $ 7,554,264
===========
Net Assets Consist of:
Paid-in capital ............................................ $ 7,726,666
Net unrealized depreciation ................................ (172,402)
-----------
Net Assets ................................................... $ 7,554,264
===========
See Notes to Financial Statements.
<PAGE>
EMERGING MARKETS PORTFOLIO
STATEMENT OF OPERATIONS
For the six months ended April 30, 1998
(unaudited)
(expressed in U.S. dollars)
INVESTMENT INCOME:
Income:
Dividends (net of foreign withholding tax of $1,250) ..... $ 61,954
-----------
Expenses:
Investment advisory fee (Note 2) ......................... 36,252
Expense reimbursement fee (Note 2) ....................... 12,771
Administrative fee (Note 2) .............................. 1,410
-----------
Total Expenses ....................................... 50,433
-----------
Net Investment Income ................................ 11,521
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) (Notes 1 and 3):
Net realized loss on investments and foreign exchange
transactions ............................................. (1,451,188)
Net change in unrealized depreciation on investments
and foreign currency translations ........................ 1,587,956
-----------
Net Realized and Unrealized Gain ....................... 136,768
-----------
Net Increase in Net Assets Resulting from Operations ........ $ 148,289
===========
See Notes to Financial Statements.
<PAGE>
EMERGING MARKETS PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
For the period from
For the six June 6, 1997
months ended (commencement of
April 30, 1998 operations) to
(unaudited) October 31, 1997
------------ ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment gain (loss) ............................. $ 11,521 $ (1,775)
Net realized loss on investments and foreign exchange
transactions ........................................ (1,451,188) (276,277)
Net change in unrealized appreciation (depreciation) on
investments and foreign currency translations ....... 1,587,956 (1,760,358)
------------ ------------
Net increase (decrease) in net assets resulting from
operations ...................................... 148,289 (2,038,410)
------------ ------------
Capital Transactions:
Proceeds from contributions ............................ 1,641,755 11,739,217
Value of withdrawals ................................... (3,929,928) (6,659)
------------ ------------
Net (decrease) increase in net assets resulting from
capital transactions ............................ (2,288,173) 11,732,558
------------ ------------
Total (decrease) increase in net assets .......... (2,139,884) 9,694,148
NET ASSETS:
Beginning of period .................................... 9,694,148 0
------------ ------------
End of period (including undistributed net investment
income of $11,521 and $0, respectively) ............. $ 7,554,264 $ 9,694,148
============ ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
EMERGING MARKETS PORTFOLIO
FINANCIAL HIGHLIGHTS
Selected per share data and ratios for a share outstanding
throughout the period
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
For the period from
For the six June 6, 1997
months ended (commencement of
April 30, 1998 operations) to
(unaudited) October 31, 1997
------------ ----------------
<S> <C> <C>
Ratio/Supplemental Data:
Net assets, end of period (000's omitted)......................... $7,554 $9,694
Expenses as a percentage of average net assets.................... 1.25%* 1.25%*
Ratio of net investment income (loss) to average net assets....... 0.29%* (0.05)%*
Portfolio turnover rate........................................... 42% 60%
Average commission rate paid per share............................ $0.0188 $0.0036
</TABLE>
- ----------
* Annualized
See Notes to Financial Statements.
<PAGE>
EMERGING MARKETS PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
(unaudited)
(expressed in U.S. dollars)
1. Organization and Significant Accounting Policies. Emerging Markets
Portfolio (the "Portfolio") is registered under the Investment Company Act of
1940, as amended, as an open-end management investment company which was
organized as a trust under the laws of the State of New York on August 15, 1994.
The Portfolio commenced operations on June 6, 1997. The Declaration of Trust
permits the Trustees to create an unlimited number of beneficial interests in
the Portfolio.
The Portfolio's financial statements are prepared in accordance with
accounting principles generally accepted in the United States of America, which
require management to make certain estimates and assumptions at the date of the
financial statements and are based, in part, on the following accounting
policies. Actual results could differ from those estimates.
A. Valuation of Investments. (1) The value of investments listed on
either a domestic or foreign securities exchange is based on the last sale
price on that exchange prior to the time when assets are valued, or in the
absence of recorded sales, at the average of readily available closing bid
and asked prices on such exchange; (2) unlisted securities are valued at
the average of the quoted bid and asked prices in the over-the-counter
market; (3) securities or other assets for which market quotations are not
readily available are valued at fair value in accordance with procedures
established by and under the general supervision and responsibility of the
Portfolio's Trustees. Such procedures include the use of independent
pricing services, which use prices based upon yields or prices of
securities of comparable quality, coupon, maturity and type; indications
as to the value from dealers; and general market conditions; (4) all
assets and liabilities initially expressed in foreign currencies will be
converted into U.S. dollars at the prevailing rates of exchange available
at the time of valuation; and (5) trading in securities on most foreign
exchanges and over-the-counter markets is normally completed before the
close of the New York Stock Exchange and may also take place on days on
which the New York Stock Exchange is closed. If events materially
affecting the value of foreign securities occur between the time when the
exchange on which they are traded closes and the time when the Portfolio's
net assets are calculated, such securities will be valued at fair value in
accordance with procedures established by and under the general
supervision of the Portfolio's Trustees.
B. Foreign Currency Translations. The accounting records of the
Portfolio are maintained in U.S. dollars. Foreign currency amounts are
translated into U.S. dollars at the current rate of exchange of such
currency against the U.S. dollar to determine the value of investments,
assets and liabilities. Purchases and sales of securities, and income and
expenses are translated at the prevailing rate of exchange on the
respective dates of such transactions. Upon the purchase or sale of a
security denominated in foreign currency, the Portfolio may enter into
forward foreign currency exchange contracts for the purchase or sale, for
a fixed amount of U.S. dollars of the amount of foreign currency involved
in the underlying security transaction. The Portfolio does not isolate
that portion of realized gain or loss on investments resulting from
changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of such investments. Such
fluctuations are included with the net realized and unrealized gain or
loss from investments. Reported net realized and unrealized gains and
losses arise from the sales of portfolio securities, sales of foreign
currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between
the amounts of dividends, interest and foreign withholding taxes recorded
on the Portfolio's books and the U.S. dollar equivalent of the amounts
actually received or paid. Net unrealized appreciation or depreciation on
foreign currency translations arise from changes in the value of the
assets and liabilities, excluding investments in securities, at fiscal
year end, arising from changes in the exchange rate.
<PAGE>
EMERGING MARKETS PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (Continued)
(unaudited)
(expressed in U.S. dollars)
C. Forward Foreign Currency Exchange Contracts. The Portfolio may
enter into forward foreign currency exchange contracts ("contracts") in
connection with planned purchases or sales of securities, to hedge the
U.S. dollar value of portfolio securities denominated in a particular
currency, or to increase or shift its exposure to a currency other than
U.S. dollars. The Portfolio has no specific limitation on the percentage
of assets which may be committed to these types of contracts. The
Portfolio could be exposed to risks if the counterparties to the contracts
are unable to meet the terms of their contracts or if the value of the
foreign currency changes unfavorably. The U.S. dollar values of foreign
currency underlying all contractual commitments held by the Portfolio are
determined using forward currency exchange rates supplied by a quotation
service.
D. Accounting for Investments. Security transactions are accounted
for on the trade date. Realized gains and losses on security transactions
are determined on the identified cost method. Dividend income and other
distributions from portfolio securities are recorded on the ex-dividend
date. Dividend income is recorded net of foreign taxes withheld where
recovery of such taxes is not assured. Interest income is accrued daily.
E. Federal Income Taxes. The Portfolio will be treated as a
partnership for federal income tax purposes. As such, each investor in the
Portfolio will be subject to taxation on its share of the Portfolio's
ordinary income and capital gains. It is intended that the Portfolio's
assets will be managed in such a way that an investor in the Portfolio
will be able to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. Accordingly, no provision
for federal income taxes is necessary.
2. Transactions with Affiliates.
Investment Advisory Fee. The Portfolio has an investment advisory
agreement with Brown Brothers Harriman & Co. (the "Adviser") for which it pays
the Adviser a fee calculated daily and paid monthly at an annual rate equivalent
to 0.90% of the Portfolio's average daily net assets. For the six months ended
April 30, 1998, the Portfolio incurred $ 36,252 for advisory services.
Administrative Fee. The Portfolio has an administrative agreement with
Brown Brothers Harriman Trust Company (Cayman) Limited (the "Administrator") for
which it pays the Administrator a fee calculated daily and paid monthly at an
annual rate equivalent to 0.035% of the Portfolio's average daily net assets.
The Administrator has a subadministration agreement with Signature Financial
Group (Cayman) Ltd. for which Signature Financial Group (Cayman) Ltd. receives
such compensation as is from time to time agreed upon. For the six months ended
April 30, 1998, the Portfolio incurred $1,410 for administrative services.
Expense Reimbursement Fee. Brown Brothers Harriman Trust Company (Cayman)
Limited pays certain expenses of the Portfolio and receives a fee from the
Portfolio, computed and paid monthly, such that after such fee the aggregate
expenses will not exceed 1.25% of the Portfolio's average daily net assets. For
the six months ended April 30, 1998, Brown Brothers Harriman Trust Company
(Cayman) Limited incurred $ 13,263 in expenses on behalf of the Portfolio. The
expense reimbursement agreement will terminate when the aggregate amount of fees
received by Brown Brothers Harriman Trust Co. (Cayman) Limited thereunder equals
the aggregate amount of expenses paid by Brown Brother Harriman Trust Company
(Cayman) Limited thereunder.
3. Investment Transactions. For the six months ended April 30, 1998, the
cost of purchases and the proceeds of sales of investment securities other than
short-term investments were $ 3,371,109 and $ 3,132,571, respectively. There
were no purchases or sales of U.S. government obligations during the period.
<PAGE>
The 59 Wall Street Fund, Inc.
Investment Adviser and
Administrator
Brown Brothers Harriman & Co.
59 Wall Street
New York, New York 10005
Distributor
59 Wall Street Distributors, Inc.
21 Milk Street
Boston, Massachusetts 02109
Shareholder Servicing Agent
Brown Brothers Harriman & Co.
59 Wall Street
New York, New York 10005
(800) 625-5759
This report is submitted for the general information of
shareholders and is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective
prospectus. Nothing herein contained is to be considered an
offer of sale or a solicitation of an offer to buy shares of the
Funds. Such offering is made only by prospectus, which includes
details as to offering price and other material information.
