<PAGE>
PIONEER INDEPENDENCE FUND
[GRAPHIC OF STATUE OF LIBERTY]
-------------------
Semiannual Report
June 30, 2000
-------------------
<PAGE>
--------------------------------------------------------------------------------
Table of Contents
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
Letter from the Chairman 1
Portfolio and Performance Update 2
Portfolio Management Discussion 3
Schedule of Investments 5
Financial Statements 7
Notes to Financial Statements 11
</TABLE>
<PAGE>
--------------------------------------------------------------------------------
LETTER FROM THE CHAIRMAN 6/30/00
--------------------------------------------------------------------------------
Dear Shareowner,
For over a year, the Federal Reserve has been trying to suppress inflationary
pressures and restrain economic growth in the U.S. by raising short-term
interest rates. Because they represent increased costs, higher interest rates
cut into corporate profits.
With the possibility of a slowing economy and an uncertain profit outlook
overhanging the stock market, investors shifted from sector to sector in the
first half of 2000 looking for attractive opportunities. Heightened stock
market volatility was the result. Bonds also lost luster, because existing,
lower-paying issues could not compete with the higher rates that now prevail.
By summer, we began to see evidence that the Fed's tactics were having some
impact, as key statistics hinted at a contraction of the economy's growth rate.
Volatile markets should not sidetrack your plans for dealing with your
essential financial goals. Whatever your long-range needs may be -- money for a
child's education, funding a comfortable retirement, or some other cherished
objective -- those needs remain in place no matter what the market may do this
week or next month. For that reason, it makes sense to focus your investment
strategy beyond interim ups and downs.
Mid-year is a good time to talk to your financial representative to review what
has been happening and to make sure your strategy is intact. Part of that
discussion should be devoted to your portfolio's diversification. Do you have a
blend of stocks and bonds that you are comfortable with and that can help you
meet your goals? Or is it time to make adjustments? Be sure to include your
IRAs and other retirement vehicles when you evaluate your overall portfolio.
I hope you will take time to read the following discussion with Theresa
Hamacher, the leader of Pioneer Independence Fund's investment team. It's an
excellent way to understand the Fund's performance during the past six months
and to learn what the manager's expectations are for the months ahead. If you
have questions or would like more information about your fund, visit our web
site at www.pioneerfunds.com.
Respectfully,
/s/ John F. Cogan, Jr.
----------------------
John F. Cogan, Jr.
Chairman and President
1
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
PORTFOLIO AND PERFORMANCE UPDATE 6/30/00
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[Pie Charts]
Portfolio Diversification
(As a percentage of total investment portfolio)
<TABLE>
<S> <C>
International Common Stocks 6%
Depositary Receipts for International Stocks 15%
U.S. Common Stocks 79%
</TABLE>
Sector Diversification
(As a percentage of equity holdings)
<TABLE>
<S> <C>
Other 4%
Communication Services 5%
Energy 6%
Basic Materials 7%
Consumer Cyclicals 8%
Healthcare 8%
Capital Goods 9%
Financial 13%
Consumer Staples 13%
Technology 27%
</TABLE>
[End Pie Charts]
--------------------------------------------------------------------------------
Five Largest Holdings
(As a percentage of equity holdings)
<TABLE>
<S> <C>
1. Intel Corp. 3.11%
2. Ace Ltd. 1.81
3. Microsoft Corp. 1.79
4. Wal-Mart Stores, Inc. 1.77
5. Comcast Corp. 1.71
</TABLE>
Holdings will vary for other periods.
--------------------------------------------------------------------------------
Prices and Distributions
<TABLE>
<CAPTION>
6/30/00 12/31/99
<S> <C> <C>
Net Asset Value per Share $13.38 $11.36
</TABLE>
<TABLE>
<CAPTION>
Distributions per Share Income Short-Term Long-Term
(12/31/99 - 6/30/00) Dividends Capital Gains Capital Gains
<S> <C> <C> <C>
- - -
</TABLE>
--------------------------------------------------------------------------------
Performance of a $10,000 Investment+
The following chart shows the value of an investment made in Pioneer
Independence Fund, compared to the growth of the Russell 1000 Index.
[Plot Points for Line Chart]
<TABLE>
<CAPTION>
Pioneer Russell
Independence 1000
Fund* Index
<S> <C> <C>
"3/98" 10000 10000
9900 10251
8126 9193
"12/98" 9693 11204
10015 11667
11112 12498
"9/99" 10327 11673
11910 13548
13431 14140
"6/00" 14028 13654
</TABLE>
[End Line Chart]
+ Index comparison begins 3/31/98. The Russell 1000 Index is an unmanaged
measure of the 1,000 largest companies in the Russell 3000 Index,
representing approximately 92% of the total market capitalization of the
Russell 3000. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any fees or expenses.
You cannot invest directly in the Index.
Average Annual Total Returns
(As of June 30, 2000)
--------------------------------------------------------------------------------
Net Asset Value*
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period
<S> <C>
Life-of-Fund 16.08%
(3/16/98)
1 Year 26.24%
</TABLE>
Returns assume reinvestment of distributions at net asset value.
* Reflects Fund performance only, at net asset value. Does not reflect
Creation and Sales Charges applicable to purchases of Fund shares through
Pioneer Independence Plans, which vary as discussed in the Plans'
prospectus. For the first 12 investments, these charges amount to 50% of
the total amount invested. Total return would be reduced if these charges
were taken into account.
Past performance does not guarantee future results. Return and share prices
fluctuate so that your investment, when redeemed, may be worth more or less than
its original cost.
2
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 6/30/00
--------------------------------------------------------------------------------
Theresa Hamacher is Pioneer's Chief Investment Officer and the leader of Pioneer
Independence Fund's management team. The investment team selects stocks for the
Fund from among the issues that Pioneer's other portfolio managers have chosen
for their own funds.
Q: The first half of the year saw dramatic shifts in market focus. Please
describe them.
A: The major market indices recorded only minor changes between December and
June, but the first half of 2000 was anything but calm. There were wide
shifts in sentiment and many inflated dot-com stocks got punctured. Add the
stress of higher interest rates and it's no surprise that markets were more
volatile than they had been for some time.
Early in the year there was a wide divergence between the high valuations
that investors placed on companies operating in the "new economy" --
technology and Internet stocks -- and the modest valuations seen elsewhere.
The divergence shrank with the March-April decline in the
technology-centered NASDAQ Composite Index, as investors migrated toward
traditional "old economy" industries where they found more attractive
values. The popularity of value investing lasted through May, and by June
growth was back in favor. But there was no return to the dot-com excesses
that had characterized the markets for so long.
Q: Given all these changes, how did the Fund perform?
A: Performance was very strong despite the background of investor indecision.
Pioneer Independence Fund's total return for the six months ended June 30,
2000 was 17.78%, at net asset value. By way of comparison, the Russell 1000
Index, the Fund's benchmark, gained 0.78% for the period. The Russell 1000
Index measures the performance of the 1000 largest stocks in the Russell
3000 Index. It is a broader measure of performance than the Standard &
Poor's 500 Stock Index[TM], which registered a decline of 0.45% for the
same period.
Q: How did you manage the Fund's technology holdings during this volatile
period?
A: The Fund was underweighted in technology issues when the downturn came in
the spring, which aided performance. Our selections also held up well as
investors sold dot-com issues in favor of proven technology companies. We
expanded holdings in the sector during the second quarter of the year, to
take advantage of lower prices. Power- One, which makes power supplies for
computer networks, was an exceptionally strong performer as demand grew for
its products among companies involved in the expansion of the Internet.
Growth in wireless communication and the expansion of the Internet are also
driving persistent high demand for semiconductors. Intel, the industry
leader, is the Fund's largest holding.
The Fund also participated in successful initial public offerings in the
technology sector. IPO investments do, however, entail risk, and there can
be no assurance that these investments will continue to contribute to the
Fund's performance.
3
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 6/30/00 (continued)
--------------------------------------------------------------------------------
Q: What other sectors performed well?
A: Although we slightly reduced Fund exposure to the sector, healthcare stocks
added to fund performance. This sector could serve as a haven if high
interest rates ultimately trigger an economic slowdown.
Investor sentiment toward the for-profit hospital industry has improved
with the fading of legislative concerns. Columbia/HCA Healthcare moved up
following resolution of pending legal issues. Among the Fund's strong
performers in biotechnology was Elan Pharmaceuticals which develops
delivery systems for pharmaceutical products, especially in the areas of
neurology and acute care.
The Fund's overweight position (compared to its benchmark) in the energy
sector was a strong positive. Energy holdings did well as prices for oil
and natural gas rose sharply. R&B Falcon, an oil drilling company,
performed particularly well; the company's earnings are tightly linked to
trends in oil prices. The Fund also benefited from being underweighted in
the financial sector, which suffers disproportionately when interest rates
are rising. The exception was insurance stocks. Fund holding Ace, responded
well to higher premium rates.
Q: Where are you finding opportunities now?
A: Many mid-sized and small companies currently represent good values compared
to our assessment of their potential. These areas of the market were
neglected while investors focused on large-capitalization issues and have
begun to perform better of late. Celestial Seasonings, a maker of herbal
teas, was a big contributor to performance when it was purchased by Hain
Food Group. This position has since been replaced by Horizon Organic
Holding, a producer of organic dairy products.
Growth in Europe appears more predictable than here at home, aided by the
weak Euro. We have increased the overseas component of the Fund to 21% at
June 30, compared to 13% at the end of last year. Bermuda's Ace, a
diversified insurer, and Aventis, a French producer of prescription drugs
and agricultural chemicals, are among the Fund's 10 largest holdings.
Q: Which areas have been disappointing?
A: In general, our sector decisions held back performance, offsetting the
benefit of strong stock selection. In addition, both consumer staples
companies and retailers performed poorly, hurt by the threat of a slowing
growth rate in the U.S. Among individual holdings, Gillette continued to
struggle in spite of renewed economic growth in emerging markets where the
company derives a large part of its revenues.
Q: Please describe where you think the U.S. economy is heading.
A: After six hikes in short-term interest rates, the Federal Reserve Board has
managed to cool the economy. Job creation has slowed, and there has been
little overall increase in wages. Housing starts and car sales, both
important economic indicators, are also slowing. So the question now is
whether the Fed will be satisfied with the slowing that has occurred, or
find it necessary to tighten further in August.
Overall, markets should be very selective for the rest of the year. And as
investors cast a wider net than in the recent past, diversification may
once more be rewarded.
4
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/00 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - 100.0%
Basic Materials - 6.6%
Aluminum - 1.2%
8,600 Alcoa, Inc. $ 249,400
----------
Chemicals - 1.5%
9,200 Rohm & Haas Co. $ 317,400
----------
Chemicals (Diversified) - 1.7%
5,000 Aventis (A.D.R.) $ 362,812
----------
Metals Mining - 1.2%
4,100 Rio Tinto Plc (A.D.R.)* $ 267,525
----------
Paper & Forest Products - 1.0%
5,100 Bowater, Inc. $ 225,037
----------
Total Basic Materials $1,422,174
----------
Capital Goods - 8.9%
Electrical Equipment - 4.1%
4,200 Emerson Electric Co. $ 253,575
3,000 Power-One, Inc.* 341,812
7,600 SCI Systems, Inc.* 297,825
----------
$ 893,212
----------
Machinery (Diversified) - 1.3%
7,300 Deere & Co. $ 270,100
----------
Manufacturing (Diversified) - 2.2%
4,400 Illinois Tool Works, Inc. $ 250,800
4,300 Sealed Air Corp.* 225,213
----------
$ 476,013
----------
Office Equipment & Supplies - 1.3%
5,600 Canon Inc. (A.D.R.) $ 282,100
----------
Total Capital Goods $1,921,425
----------
Communication Services - 5.1%
Telephone - 5.1%
7,000 Bell Atlantic Corp. $ 355,688
5,200 Kononklijke KPN NV (A.D.R.) 233,675
3,800 Nippon Telegraph & Telephone (A.D.R.) 259,825
5,600 SBC Communications, Inc. 242,200
----------
Total Communication Services $1,091,388
----------
Consumer Cyclicals - 7.8%
Automobiles - 0.7%
2,557 General Motors Corp. $ 148,466
----------
Publishing (Newspapers) - 1.1%
4,150 Gannett Co., Inc. $ 248,222
----------
Retail (Discounters) - 1.4%
15,050 Dollar General Corp. $ 293,475
----------
Retail (General Merchandise) - 1.8%
6,600 Wal-Mart Stores, Inc. $ 380,325
----------
Retail (Specialty-Apparel) - 0.9%
13,900 Wilsons The Leather Experts* $ 204,156
----------
<CAPTION>
Shares Value
<S> <C> <C>
Services (Advertising/Marketing) - 0.9%
2,200 Omnicom Group $ 195,937
----------
Services (Commercial & Consumer) - 1.0%
12,000 Vivendi (A.D.R.) $ 212,250
----------
Total Consumer Cyclicals $1,682,831
----------
Consumer Staples - 13.0%
Broadcasting
(Television/Radio/Cable) - 3.9%
9,100 Comcast Corp.* $ 368,550
7,000 Infinity Broadcasting Corp.* 255,062
3,000 MediaOne Group, Inc.* 198,956
----------
$ 822,568
----------
Entertainment - 1.4%
4,500 Viacom, Inc. (Class B) (Non-voting)* $ 306,844
----------
Foods - 1.9%
26,000 Horizon Organic Holding Corp.* $ 276,250
2,800 Hershey Foods Corp. 135,800
----------
$ 412,050
----------
Personal Care - 1.3%
7,800 The Gillette Co. $ 272,513
----------
Restaurants - 2.2%
9,500 CEC Entertainment Inc.* $ 243,438
7,200 McDonald's Corp. 237,150
----------
$ 480,588
----------
Retail (Drug Stores) - 1.3%
8,700 Walgreen Co. $ 280,031
----------
Services (Employment) - 1.0%
19,500 Servicemaster Co. $ 221,812
----------
Total Consumer Staples $2,796,406
----------
Energy - 6.0%
Oil (Domestic Integrated) - 2.4%
11,500 Conoco, Inc. $ 253,000
5,200 Shell Transport & Trading Co. (A.D.R.) 259,675
----------
$ 512,675
----------
Oil (International Integrated) - 1.0%
4,200 Texaco, Inc. $ 223,650
----------
Oil & Gas (Drilling & Equipment) - 2.6%
12,000 R&B Falcon Corp.* $ 282,750
5,600 Halliburton Co. 264,250
----------
$ 547,000
----------
Total Energy $1,283,325
----------
Financial - 12.6%
Banks (Major Regional) - 2.2%
5,700 The Bank of New York Co., Inc. $ 265,050
5,600 Wells Fargo Co. 217,000
----------
$ 482,050
----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 5
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/00 (unaudited) (continued)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Financial (Diversified) - 2.2%
16,500 Indymac Mortgage Holdings, Inc. $ 223,781
14,500 Trizec Hahn Corp. 259,188
-----------
$ 482,969
-----------
Insurance (Multi-Line) - 2.3%
2,200 American International Group, Inc. $ 258,500
3,000 Axa (A.D.R.) 238,688
-----------
$ 497,188
-----------
Insurance (Property/Casualty) - 4.8%
13,900 Ace Ltd. $ 389,200
3,000 Allmerica Financial Corp. 157,125
140 Berkshire Hathaway, Inc. (Class B)* 246,400
4,000 Exel Ltd. 216,500
-----------
$ 1,009,225
-----------
Savings & Loan Companies - 1.1%
10,500 Charter One Financial, Inc. $ 241,499
-----------
Total Financial $ 2,712,931
-----------
Healthcare - 7.9%
Biotechnology - 2.6%
4,100 Amgen, Inc.* $ 288,024
5,160 Pharmacia Corp. 266,708
-----------
$ 554,732
-----------
Healthcare (Diversified) - 5.3%
4,900 American Home Products Corp. $ 287,875
9,300 Columbia/HCA Healthcare Corp. 282,488
6,000 Elan Pharmaceuticals Plc (A.D.R.)* 290,625
3,300 United Healthcare Corp. 282,975
-----------
$ 1,143,963
-----------
Total Healthcare $ 1,698,695
-----------
Technology - 27.0%
Communications Equipment - 2.1%
2,500 Alcatel (A.D.R.) $ 166,250
6,000 Motorola Inc. 174,375
6,000 Telefonaktiebolaget LM Ericsson
(A.D.R.) 120,000
-----------
$ 460,625
-----------
Computers (Hardware) - 2.5%
10,000 Compaq Computer Corp. $ 255,625
2,600 IBM Corp. 284,863
-----------
$ 540,488
-----------
Computers (Networking) - 2.2%
12,000 Cabletron Systems, Inc.* $ 303,000
17,000 Quantum Corp.* 164,688
-----------
$ 467,688
-----------
Computers (Software & Services) - 7.6%
2,200 Adobe Systems, Inc. $ 286,000
2,700 Dassault Systemes SA (A.D.R.) 253,800
<CAPTION>
Shares Value
<S> <C> <C>
Computers (Software & Services) - (continued)
4,000 Lernout & Hauspie Speech Products NV* $ 176,250
4,800 Microsoft Corp.* 384,000
6,500 SAP AG (A.D.R.) 305,094
6,000 Wind River Systems* 227,250
-----------
$ 1,632,394
-----------
Electronics (Defense) - 1.3%
3,197 General Motors Corp. (Class H) $ 280,537
-----------
Electronics (Semiconductors) - 8.7%
5,000 Intel Corp. $ 668,438
4,600 Linear Technology Corp. 294,113
3,500 Sandisk Corp.* 214,156
2,500 Teradyne, Inc.* 183,750
4,000 Texas Instruments, Inc. 274,750
3,100 Veeco Instruments, Inc.* 227,075
-----------
$ 1,862,282
-----------
Photography/Imaging - 1.2%
4,400 Eastman Kodak Co. $ 261,798
-----------
Services (Data Processing) - 1.4%
7,050 Paychex Inc. $ 296,100
-----------
Total Technology $ 5,801,912
-----------
Transportation - 2.4%
Airlines - 1.1%
12,900 Southwest Airlines Co. $ 244,294
-----------
Railroads - 1.3%
9,200 Canadian National Railway Co. $ 268,525
-----------
Total Transportation $ 512,819
-----------
Utilities - 2.7%
Electric Companies - 1.3%
6,400 Dominion Resources, Inc. $ 274,400
-----------
Natural Gas - 1.4%
5,950 El Paso Energy Corp. $ 303,078
-----------
Total Utilities $ 577,478
-----------
TOTAL INVESTMENT IN SECURITIES - 100.0%
(Cost $18,854,822) (a) $21,501,384
-----------
*Non-income producing security.
(a) At June 30, 2000, the net unrealized gain on investments based
on cost for federal income tax purposes of $18,858,716 was
as follows:
Aggregate gross unrealized gain for all
investments in which there is an excess
of value over tax cost $ 3,168,042
Aggregate gross unrealized loss for all
investments in which there is an excess
of tax cost over value (525,374)
-----------
Net unrealized gain $ 2,642,668
-----------
</TABLE>
Purchases and sales of securities (excluding temporary cash investments)
for the six months ended June 30, 2000 aggregated $17,177,335 and $10,193,418,
respectively.
6 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
BALANCE SHEET 6/30/00 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (cost $18,854,822) $21,501,384
Cash 143,034
Receivables -
Investments in securities sold 74,698
Fund shares sold 31,243
Dividends and interest 15,745
Organizational costs - net 27,030
Other 297
-----------
Total assets $21,793,431
-----------
LIABILITIES:
Payables -
Investment securities purchased $ 5,400
Fund shares repurchased 4,399
Due to affiliates 50,140
Accrued expenses 64,352
-----------
Total liabilities $ 124,291
-----------
NET ASSETS:
Paid-in capital $17,485,327
Accumulated net investment loss (15,973)
Accumulated undistributed net realized gain on investments 1,553,224
Net unrealized gain on investments 2,646,562
-----------
Total net assets $21,669,140
-----------
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Based on $21,669,140/1,619,064 shares $ 13.38
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 7
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (unaudited)
--------------------------------------------------------------------------------
For the Six Months Ended 6/30/00
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $3,499) $ 92,723
Interest 12,157
--------
Total investment income $ 104,880
----------
EXPENSES:
Management fees $ 62,112
Transfer agent fees 188,251
Distribution fees 7,160
Administrative fees 15,429
Custodian fees 10,101
Registration fees 6,047
Professional fees 11,858
Printing 3,888
Fees and expenses of nonaffiliated trustees 11,557
Organization costs 5,049
Miscellaneous 4,451
--------
Total expenses $ 325,903
Less management fees waived and expenses reimbursed
by Pioneer Investment Management, Inc. (196,819)
Less fees paid indirectly (4,836)
----------
Net expenses $ 124,248
----------
Net investment loss $ (19,368)
----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments $1,229,265
Change in net unrealized gain on investments 1,563,652
----------
Net gain on investments $2,792,917
----------
Net increase in net assets resulting from operations $2,773,549
----------
</TABLE>
8 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
For the Six Months Ended 6/30/00 and the Year Ended 12/31/99
<TABLE>
<CAPTION>
Six Months
Ended Year
6/30/00 Ended
(unaudited) 12/31/99
<S> <C> <C>
FROM OPERATIONS:
Net investment loss $ (19,368) $ (1,479)
Net realized gain on investments 1,229,265 788,350
Change in net unrealized gain on investments 1,563,652 850,390
---------- ----------
Net increase in net assets resulting from operations $2,773,549 $1,637,261
---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ($0.00 and $0.01 per share, respectively) $ - $ (11,270)
Net realized gain ($0.00 and $0.44 per share, respectively) - (415,418)
---------- ----------
Total distributions to shareholders $ - $ (426,688)
---------- ----------
<CAPTION>
'00 Shares
(unaudited) '99 Shares
<S> <C> <C> <C> <C>
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares 601,719 787,365 $ 7,383,912 $ 8,236,803
Reinvestment of distributions - 37,959 - 414,702
Cost of shares repurchased (40,655) (113,751) (506,638) (1,178,967)
------- -------- ----------- ------------
Net increase in net assets resulting from fund share transactions 561,064 711,573 $ 6,877,274 $ 7,472,538
------- -------- ----------- ------------
Net increase in net assets $ 9,650,823 $ 8,683,111
NET ASSETS:
Beginning of period 12,018,317 3,335,206
End of period (including accumulated net investment income (loss) of ($15,973) ----------- ------------
and $3,395, respectively) $21,669,140 $ 12,018,317
----------- ------------
</TABLE>
The accompanying notes are an integral part of these financial statements. 9
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 6/30/00
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year 3/16/98
6/30/00 Ended to
(unaudited) 12/31/99 12/31/98(a)
<S> <C> <C> <C>
Net asset value, beginning of period $ 11.36 $ 9.63 $10.00
------- ------- ------
Net increase (decrease) from investment operations:
Net investment loss $ (0.01) $ (0.01) $(0.01)
Net realized and unrealized gain (loss) on investments 2.03 2.19 (0.27)
------- ------- ------
Net increase (decrease) from investment operations $ 2.02 $ 2.18 $(0.28)
Distributions to shareholders:
Net investment income -- (0.01) (0.09)
Net realized gain -- (0.44) --
------- ------- ------
Net increase (decrease) in net asset value $ 2.02 $ 1.73 $(0.37)
------- ------- ------
Net asset value, end of period $ 13.38 $ 11.36 $ 9.63
------- ------- ------
Total return* 17.78% 22.88% (2.78)%
Ratio of net expenses to average net assets+ 1.55%** 1.58% 1.68%**
Ratio of net investment loss to average net assets+ (0.29)** (0.11)% (0.30)**
Portfolio turnover rate 126%** 106% 118%**
Net assets, end of period (in thousands) $21,669 $12,018 $3,335
Ratios assuming no waiver of management fees and assumption of expenses by PIM
and no reduction for fees paid indirectly:
Net expenses 3.92%** 6.18% 17.26%**
Net investment loss (2.66)** (4.71)% (15.88)**
Ratios assuming waiver of management fees and assumption of expenses by PIM
and reduction for fees paid indirectly:
Net expenses 1.50%** 1.50% 1.50%**
Net investment loss (0.24)** (0.03)% (0.12)**
</TABLE>
(a) The per share data presented above is based upon the average shares
outstanding for the period presented.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at net asset value at the end of each period.
** Annualized.
+ Ratios assuming no reduction for fees paid indirectly.
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Independence Fund
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/00 (unaudited)
--------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Independence Fund (the Fund) is a Delaware business trust registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Fund is available to the general public only through
Pioneer Independence Plans, a systematic investment plan sponsored by Pioneer
Funds Distributor, Inc. (PFD). The investment objective of the Fund is to seek
capital appreciation.
The Fund's financial statements have been prepared in conformity with generally
accepted accounting principles that require the management of the Fund to,
among other things, make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts
of revenues and expenses during the reporting periods. Actual results could
differ from those estimates. The following is a summary of significant
accounting policies consistently followed by the Fund, which are in conformity
with those generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. The net asset value is
computed once daily, on each day that the New York Stock Exchange is open,
as of the close of regular trading on the Exchange. In computing the net
asset value, securities are valued at the last sale price on the principal
exchange where they are traded. Securities that have not traded on the date
of valuation, or securities for which sale prices are not generally
reported, are valued at the mean between the last bid and asked prices.
Securities for which market quotations are not readily available are valued
at their fair values as determined by, or under the direction of, the Board
of Trustees. Dividend income is recorded on the ex-dividend date and
interest income, including interest on income bearing cash accounts, is
recorded on the accrual basis. Temporary cash investments are valued at
amortized cost.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
It is the Fund's practice to first select for sale those securities that
have the highest cost and also qualify for long-term capital gain or loss
treatment for tax purposes.
B. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareholders. Therefore, no federal income tax provision is required.
The characterization of distributions to shareholders for financial
reporting purposes is determined in accordance with federal income tax
rules. Therefore, the source of the Fund's distributions may be shown in
the accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
C. Fund Shares
The Fund records sales and repurchases of its shares as of trade date.
Dividends and distributions to shareholders are recorded as of the
ex-dividend date.
D. Repurchase Agreements
With respect to repurchase agreements entered into by the Fund, the value
of the underlying securities (collateral), including accrued interest
received from counterparties, is required to be at least equal to or in
excess of the value of the repurchase agreement at the time of purchase.
The collateral for all repurchase agreements is held in safekeeping in the
customer-only account of the Fund's custodian, or subcustodians. The Fund's
investment adviser, Pioneer Investment Management, Inc. (PIM), is
responsible for determining that the value of the collateral remains at
least equal to the repurchase price.
E. Deferred Organization Costs
The costs incurred by the Fund in connection with its organization have
been deferred and are being amortized on a straight-line basis over a
period of up to five years. If PFD redeems any of its initial investment
prior to the end of the amortization period, the redemption proceeds will
be decreased by the pro rata share of the unamortized expenses as of the
date of redemption. The pro rata share is derived by dividing the number of
original shares redeemed by the total number of original shares outstanding
at the time of redemption.
2. Management Agreement
PIM manages the Fund's portfolio and is a wholly owned subsidiary of The
Pioneer Group, Inc. (PGI). Management fees are calculated daily at the annual
rate of 0.75% of the Fund's average daily net assets.
PIM has agreed not to impose all or a portion of its management fee and to
assume other operating expenses of the Fund to the extent necessary to limit
the Fund's expenses to 1.50% of average daily net assets. PIM's agreement is
temporary and voluntary and may be revised or terminated at any time.
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Pioneer Independence Fund
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NOTES TO FINANCIAL STATEMENTS 6/30/00 (unaudited) (continued)
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In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Fund.
3. Transfer Agent
Pioneering Services Corporation (PSC), a wholly owned subsidiary of PGI,
provides substantially all transfer agent and shareholder services to the Fund
at negotiated rates. Included in due to affiliates is $47,283 in transfer agent
fees payable to PSC at June 30, 2000.
4. Distribution Plan
The Fund adopted a Plan of Distribution in accordance with Rule 12b-1 of the
Investment Company Act of 1940. Pursuant to the Distribution Plan, the Fund
pays PFD a service fee of up to 0.25% of the Fund's average daily net assets
attributable to shares that have been outstanding for more than twelve months
in reimbursement of its actual expenditures to finance activities primarily
intended to result in the sale of fund shares. Included in due to affiliates is
$2,857 in distribution fees payable to PFD at June 30, 2000.
5. Expense Offsets
The Fund has entered into certain expense offset arrangements resulting in a
reduction in the Fund's total expenses. For the six months ended June 30, 2000,
the Fund's expenses were reduced by $4,836 under such arrangements.
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[PIONEER LOGO] PIONEER INDEPENDENCE FUND
Officers
John F. Cogan, Jr., Chairman and President
David D. Tripple, Executive Vice President
Eric W. Reckard, Treasurer
Joseph P. Barri, Secretary
Trustees
John F. Cogan, Jr.
Mary K. Bush
Richard H. Egdahl, M.D.
Margaret B.W. Graham
Marguerite A. Piret
David D. Tripple
Stephen K. West
John Winthrop
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Distributor
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr LLP
Pioneer Independence Fund is available to the general public only through
Pioneer Independence Plans, a systematic investment plan sponsored by Pioneer
Funds Distributor, Inc.
This report must be preceded or accompanied by a prospectus for Pioneer
Independence Fund, which includes more information about charges and expenses.
Please read the prospectus carefully before you invest or send money.
8741-00-0800
(Copyright) Pioneer Funds Distributor, Inc.
